Litchfield City Council approved the city’s 2023 budget and levy last week, but only after some pointed questions and concerns from one of its members.
Councilor Darlene Kotelnicki, who represents Ward 2, said she was “not happy at all” with a budget process she said allowed little time for council member input on specific areas of expense, especially as spending continues to grow.
Kotenicki specifically called out what she felt was an unacceptable rise in contracted services, among other issues.
“I’m not disputing the value of these people,” she said. “But we cannot continue on this path. We can hire somebody for a fraction of what we’re paying for some of this.”
Kotelnicki was the lone dissenting vote as the Council approved a series of four resolutions dealing with the 2023 tax levy and budget.
The resolutions approved the city’s total levy of $3,397,248 for 2023, with budgeted operating funds totalling $29,824,459.
The City Council voted unanimously in September to approve a preliminary levy and budget that called for a 5.2% increase in the levy. That increase was reflected in the resolutions approved Monday.
In a memo that was part of the 2023 budget packet, City Administrator Dave Cziok wrote the budget was “consistent with previous budgets. Those familiar with the operation of the City of Litchfield should see no changes to the services provided. Inflation, rising materials and fuel cost, along with labor rate increase are all contributing to increases in expenditures across all funds.”
Increases in various budget funds largely “approximate” the 7.7% average inflation rate witnessed in 2022, Cziok said. Additionally, the administration expects to see the cost of purchased electric power rise as suppliers pass their costs on to consumers, and a significant increase in chemical costs will affect some city budgets as well.
While rising costs are rarely good news, the city’s growing tax capacity actually lowered the tax rate slightly — from 60.83% to 59.33%. That means that the owner of a home valued at $165,000 would see a $22 decrease in taxes from 2022, assuming the home value did not change — an unlikely scenario since most residential property values have increased.
Comparatively, Litchfield ranks about in the middle of a group of similar-sized Minnesota cities with strong industrial and agriculture bases, in terms of taxes, according to an analysis included in the budget book. Litchfield’s utility rates in 2023 also will rank near the bottom of a 12-city list of similar-sized cities in the state.
Kotelnicki indicated that she thought the City Council could — must — do better as a caretaker of public funds, however. She expressed concern that the council reviewed the current budget and learned that funds in some accounts had yet to be spent while others were over budget, only as members were preparing to approve the next year’s budget.
“That’s not good civic integrity, and we’re not being fair to our citizens,” Kotelnicki said, pushing for a change in approach so the City Council would receive a mid-year budget update. “I don’t think that’s unrealistic. So that’s just how I feel I’m not angry. I’m just disappointed, I guess.”
Mayor Keith Johnson pushed back, saying that he trusted the administrative staff. Litchfield’s tax rate and utility rates being better than other comparable cities indicates good management, he said.
“I have full faith in our administration to make sure that this budget is well thought over,” Johnson said. “And they’re the ones that deal with this money, constantly, and I respect that.”
Cziok said he took no offense to Kotelnicki’s questioning.
“I made the statement in the past that I think the most conservative people in this room sit over here at this (staff) table,” Cziok said, later adding that, “We didn’t get any feedback from the council in September that you were worried that we needed to move that (levy) significantly come to this time of year, and the budget’s reflective of that conversation and action the council’s taken since September.”
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