Minutes - Council - 12/04/2006 - Truth in Taxation

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Mr. Harmon inquired if in the future the City was going to try and match closer to what the expenditures would be rather than have a 9 to 10 % difference. Mayor Gamec replied that it was difficult to say at this point. Robert Bowden, stated that he is seeing a 63% increase on his property valuation for his commercial property. Mayor Gamec recommended that he bring in his property tax statement to the Board of Review meeting in April or contact the County Assessor. Finance Officer Lund noted that ifthere is a 63% increase, something is wrong. Gary Gruber, Diamonds, noted that he has talked to another business owner in the City that had an 83% increase and went into the County. After the County reviewed the valuation it was reduced down to 26%. He claimed that the County had acknowledged that there had been some errors with property valuations on an area of businesses in the City. Finance Officer Lund reviewed the 2007 proposed budget was presented in a handout at the meeting. The proposed budget for 2007 is $10,624,794. Frank Fredrick, Ramsey, questioned if there were significant errors made in the valuation of properties, what impact would that have on the budget. Ms. Lund replied that if that is truly the case they are going to have to take that into consideration. She noted that if the City general fund budget falls short they would have to pull money from other funds. Councilmember Elvig stated that the fact there may be errors in the valuation of some of the business properties is a concern. If the County made an adjustment of a valuation from an 83% increase down to a 26% increase, would that be accounted for? Finance Officer Lund replied no. Mr. Fredrick noted that he personally knows of five businesses that had to have their valuations changed because they came in at 63 % increase. Finance Officer Lund stated that they need to find out who those businesses are and if they are in a TIF district. If the properties are in a TIF district it would not impact the City's revenue stream as it relates to the general fund. But if they are not located in a TIF district it could have an impact on the budget depending how many businesses they are talking about. Councilmember Elvig stated that this is a big concern to him. He didn't know how they could propose a budget without understanding what is going on with the error in property valuations. Mr. Fredrick noted that it was his understanding that the properties being referred to are not in the TIF district but located along Highway 10. City Council Truth in Taxation/December 4, 2006 Page 8 of9