New state requirements forced the council to revise and chop away its original 2014 budget, which called for a 5.87 percent levy increase.
The city approved its budget draft version No. 2 with a 1.92 percent levy increase.
The biggest portion of savings comes from reducing funds for one police patrol staff, saving approximately $97,000.
The police department makes up 45.45 percent of personnel cost and 37 percent of the total expenditures in the 2014 budget.
Since 2006, the city has eliminated 12 staff positions.
Council members may have approved it, but they weren’t happy about it.
“I won’t take anyone saying the city of Farmington cut a police officer and it was a decision they made,” Council member Christy Jo Fogarty said. “The state of Minnesota made this decision — the governor’s office, the Legislature — they should be ashamed of themselves of trying to take over local government’s budgeting. We have plenty of residents who know what we’re doing up here. They make their decision on whether or not we’re doing a good job, and that’s where it should stay.”
The council expressed frustration with the state-imposed levy limit during meetings in early summer citing that Farmington has not increased its tax levy for the past two years.
“It’s nothing surprising we’ve been looking at this for months now,” Council Member Terry Donnelly said. “Not everyone is happy about it, but it’s the reality. It’s the best we can do. We’re meeting the needs within our means.”
The council approved the measure 4-0. Council Member Jason Bartholomay was absent.
The average home’s property tax will increase $9.97 for the year in payable 2015, but it will vary greatly depending on housing values.
Taxes on residential properties in the middle range are expected to decrease by more than $100, while others in the lower bracket will go up a small amount and the upper range could see an increase of $45 to $95 for the year.
“It’s going to be what I call a transition year,” City Administrator Dave McKnight said. “If you look at the range of how our proposed tax levy increase impacts these properties, it’s pretty broad.”
Levy limits were put in place for cities and counties for 2014 by the 2013 Legislature, but Local Government Aid returned for the first time in 10 years.
Farmington will receive $245,329 in LGA funds, and the city decided to use them for one-time purchases. About $181,000 is going toward fire department purchases such as a fire chief vehicle, a fire brush truck skid unit, and floor repairs in Station No. 1.
The remaining funds will go toward building fund expenses, police cars, investigation equipment and exercise equipment.
The city will also no longer have to pay state sales tax, saving a conservative amount of $30,000.
The levy already cut ice arena and operational increases. The city ended up bonding for its capital improvement plans, including the Akin Road project. The main reason for the levy increase is the new debt to fund the capital improvement plan.
McKnight also said that increased building permit activity, an improved housing market and a repayment of back taxes has improved Farmington’s outlook for the future.
The actual budget will not be approved until the end of December. The public input meeting date for the final 2014 budget and tax levy is at 7 p.m. Dec. 2 at Farmington City Hall.