WILLMAR
— The
Willmar City Council
on Monday in a split 7-1 vote approved the final 2024 levy and budget for the city of Willmar. Casting the lone no vote was Councilor Tom Butterfield.
Three people spoke and one letter was read during the Truth-in-Taxation hearing, urging the council to not increase the levy at all this year.
The approved 2024 levy is approximately $10.185 million, an increase of $996,318, or 10.84%, over the 2023 levy. However, it is a decrease of approximately $389,000 from the
preliminary 2024 levy that the council approved in September.
Finance Director Tom Odens explained that the decrease was made possible by each department making little cuts in its budget.
The approved 2024 budget for the city of Willmar is approximately $67.7 million, an increase of $12.1 million, or 21.76%, over the 2023 budget. The city of Willmar has increased its tax capacity by approximately $1.44 million since 2023 due to new construction and market value increases, according to Odens.
“The city is continuing to invest in the street improvement program, we’re putting aside money for a future city hall and are continuing our capital improvement program, as well as balancing our budget,” Odens said.
He reminded the council and the public that the city since 2017 has been deficit spending by approximately $1.235 million dollars annually.
Contributed / Tom Odens
He also explained that the deficit spending has caused the city to deplete its reserves, which were at approximately 44% as of the 2022 audit. According to city policy, the reserves should not fall below 40%.
“It has been council’s direction to reduce our reserve. We are just at the point now where we don’t really want to go any lower,” he said.
There is $750,000 being taken from the Community Investment Fund to help fund the 2024 capital improvement plan, according to Odens. The Community Investment Fund in the past has been used to service the debt for street improvements.
Contributed / Julie Asmus
Councilor Julie Asmus noted the main reason the city was dipping into its reserves and deficit spending was for street improvements, because that is what the public wanted. Now that the reserves are depleted, the street improvement costs have become part of the levy.
“That’s where the money is going,” Asmus said, noting that it is also the reason for the water rate increases the council recently approved.
“We had fallen way behind in our street improvements over the years and now we are in the unfortunate — this council — the unfortunate position to play catch up. That’s where the increases are coming from.”
Contributed / City of Willmar
She explained that the council approved a reduced street improvement project for 2024 and there were city residents that were upset that their street was cut from the 2024 project. It also means that the 10-year street improvement plan is now a 15- or 20-year plan.
The budget also includes salary increases, which are needed to bring the city into compliance for pay equity after a wage compensation study was completed, which the state of Minnesota requires every two years, according to Human Resources Director LuAnn Sietsema. There is a fine imposed if the city is not in compliance with pay equity.
“This has been a difficult year as far as the budget,” said Councilor Audrey Nelsen, noting the council spent a lot of time at numerous meetings attempting to cut it as much as possible.
She explained that there were some city departments that in the past have been underbudgeted by close to a million dollars, and the city’s auditors reminded the council that could not continue.
“I think the reality is that we are playing catch-up this year to pay for some things and correct some things that have been done in the past,” Nelsen said. “I don’t think we’re quite done yet, either.”
Any further reductions in the 2024 levy would just lead to a larger increase next year, she added.
“I will be voting yes for this, reluctantly, but I think this is a necessity for our community as it continues to grow, that we are brave enough to do what we need to do,” Nelsen said.
