Minot Finance Director David Lakefield addresses the Minot City Council regarding employee benefit costs at a meeting Monday on the city’s 2024 budget.
A handful of residents argued for lower property taxes at the Minot City Council’s budget hearing Monday, but some increase remains in the 2024 budget approved by the council on first reading.
The council made some changes to the nearly $200 million preliminary budget, although most of the impact wasn’t on property taxes. The council added $1 million in downtown railroad quiet zone construction into the budget using reserve funds. It injected $30,880 from sales tax collections into economic development by restoring previous reductions to Minot Area Chamber EDC and Souris Basin Planning Council. It voted to allow $94,9968 from leftover Tourism Recovery funds to remain with Visit Minot rather than be returned to the city’s general fund.
The council revisited its plan to switch to a paid-time-off (PTO) benefit for employees as opposed to maintaining separate leave for items such as vacation and sick leave. The council narrowly voted, 4-3, to allow current employees to choose whether to remain on the current leave benefit or switch to PTO, while new employees would receive PTO.
The city still would need to offer a short-term disability plan to all employees at a cost of about $230,000, City Manager Harold Stewart said. Although disability coverage is necessary only with PTO, the ability to acquire the insurance hinges on full employee participation, he said.
Resident Scott Samuelson advised the council to eliminate the property-tax relief being granted for some that ultimately raises property taxes for others. He cited the Renaissance Zone and Tax Increment Financing as programs that shift the tax burden.
“When you do this, you take revenue away from our police and fire so that these funds need to be made up through homeowners’ property taxes,” he said. “You could cut the facade (improvement) program, a $448,00 giveaway, benefitting for-profit businesses and property owners. Second, in this budget, $350,000 for a wayfinders signage program. Between these tax relief proposals and budget cuts, the savings would amount to several million dollars.”
Samuelson also cited large spending increases in areas such as water treatment supplies, books and subscriptions and HVAC maintenance and repair.
“It’s time to get spending under control and end the giveaways,” he said. “This budget can be reduced without cutting employees, and you can do so much better, and you should.”
Resident Larry Bellew called the budget’s 10 new employees excessive, questioning the need for an assistant city manager. The city is working with a recruiting firm that has received 27 applications for the position, of which nine have been advanced for review.
Bellew also questioned where the city’s Hub City money from the state went since he is unable to account for it in the budget.
“This tells me you could lower your budget by almost four mills and still maintain the same spending level,” he said.
The preliminary budget included a property tax increase of $2.84 for every $100,000 in home valuation – or about $9 a year on a $300,000 home. The property-tax request totaled $28.7 million, up about $1.5 million, with most of that increase coming from new construction and increased market values rather than the mill rate.
The budget also creates a $2 a month residential utility fee and $4 a month commercial utility fee for flood control maintenance. It would help pay for four maintenance employees for the flood protection project.
Of the 10 new positions, three impact property taxes. One is a school resource officer for Minot North, with 75% of that cost paid by the school district. An administrative clerk in the police department would go from part-time to full-time, and a transportation fleet manager would be hired.
The budget makes wage adjustments that spend an additional $2.5 million.
Accounting firm owner Mike Blessum said businesses can’t compete for workforce against the city’s benefit plans and its “giant pot of taxpayer dollars” for wages.
“I’m concerned that I’m competing against my own government for staff,” he said.
The council narrowly rejected a suggestion from council member Carrie Evans to adjust the city’s share of a family health insurance plan from 82% to 85%. The $135,601 cost would be covered by reducing preliminary budget spending by $145,789, due to insurance rates not rising as fast as expected when the budget was drafted.
“We have to listen to the people who stood up with their concerns about increasing property taxes,” council member Lisa Olson said. “This is an opportunity. While it may be pennies for each homeowner, if we can have a savings, I think that is how we should be thinking.”
Rising chemical costs impact water budget
Minot’s cost of water treatment chemicals has been running considerably higher than anticipated in 2023. The Minot City Council on Monday approved a budget amendment for an additional $600,000 to cover costs for the rest of the year.
Utilities Director Jason Sorenson said the city is close to spending the $1.35 million budgeted for chemicals at the Minot Water Treatment Plant, and the $600,000 will ensure enough supplies to finish the year.
The budget amendment also included another $10,000 to cover the unbudgeted cost of public notification to water users of a water treatment rule violation. In December of 2022, the City of Minot received a violation for failure to collect a triggered source water sample due to a positive bacteriological sample that occurred in November. A source water sample was then immediately collected, and the result, as well as follow-up samples, showed no bacteria.
However, because of the violation, a letter was delivered to residents at a cost recorded in 2023.