Anoka will have at least a 2.5 percent property tax levy decrease for next year.
The Anoka City Council adopted its preliminary budget and levy Sept. 3 after several months of fine tuning with city staff and the council.
This is the fifth consecutive year of either a levy freeze or decrease, said Finance Director Lori Yager.
“We have been very responsible during that whole five-year period,” Yager said. “That’s when the public was hardest economically, too. So it was very good timing on the council’s part to hold taxes down during that time.”
The preliminary levy is set at $5,712,265, a decrease of more than $143,840 over last year.
“The primary reason for the decrease is we have had an increase in state aid,” Yager said. “I think this is the first time I’ve said that in five years.”
Anoka will receive an additional $646,000 in Local Government Aid in 2014.
Starting in 2014 local governments will also no longer have to pay state sales tax, which will have an estimated savings of $120,000 for the city, according to Yager.
“This will result in a decrease in tax liabilities for all city properties in 2014,” Yager said.
The average home in Anoka is valued at $149,925. The assessed value went down an average of 1 percent over last year.
While real estate values are rebounding, the city assessed values lag behind, Yager said.
Next year that will change.
“We’re projecting values will go up about 10 to 15 percent for the 2015 budget,” she said.
That average homeowner will pay $642 a year in city taxes, a decrease of $50, or 7 percent.
“This is the same amount they would have paid in property taxes in 2006,” Yager said.
Anoka’s general fund budget sits at $11.04 million for 2014, a 3.1 percent increase over last year.
Changes in the coming year’s budget include a shift in the Green Haven Clubhouse out of the golf enterprise fund and into the community programming budget, said Yager.
There will be a $231,680 increase in salaries and benefits for city staff in 2014. This includes an overall 3 percent wage increase and will allow for the addition of a maintenance position in the public works department.
The council has decided to use $915,000 of fund balance for park capital projects, technology improvements and also some capital improvements within the general fund.
Capital projects planned for 2014 include the completion of the Green Haven Clubhouse entrance, the addition of a left-turn lane from Highway 47 to Bunker Lake Boulevard, a new roof for the senior center, a regular street renewal project, the addition of signals at Bunker Lake Boulevard and the construction of Castle Field Boulevard.
Yager said the electric utility will also be investing about $6 million in the construction of a substation and expenses connected to the upgrade of a Great River Energy transmission line.
No electricity rate changes are anticipated for Anoka’s customers in 2014. Yager is also not planning for water or storm sewer rate increases.
She will propose a sewer rate increase in November of 8.3 percent for 2014.
“That is about $1.50 a month on the average utility bill for sewer expense,” Yager said.
Yager said she is not sure if the city will need a recycling rate increase because of an unanticipated $10,000 contribution form Anoka County.
“We may be able to hold it off until 2015,” Yager said.
From the garage fund, the city will purchase two new police squad cars, a mechanical street sweeper, a new senior transportation bus and a three-quarter ton pickup truck.
“We have really held off on purchasing equipment for a number of years and now we’re really stating to see a necessity of having to do some of these equipment replacements,” Yager said.
Councilmember Mark Freeburg said a misconception exists among Anoka residents that eventually taxes are going to spike to pay for a long list of public improvements the city has undertaken over the past few years.
“If you look around at all the stuff going on in this town, the perception is, ‘oh my gosh, when’s the bill coming due?’ Well it’s all paid for and we work hard to keep it that way,” Freeburg said.
Mayor Phil Rice agreed that it has been exceptional that the city has been able to undertake a large number of projects, all while reducing city taxes.
“I know that some of that is hedging our bets on what will happen in the future but I’m confident as the years progress our tax burdens will continue to decrease as we see more properties added to the tax roles,” he said.
“I think the council has done a nice job, not only in being able to do a lot of big things and keep the taxes low but also prepare for the future.”
Mandy Moran Froemming is at [email protected]