City tries to keep taxes down as costs rise

Published 3:23pm Friday, March 4, 2011
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A recent report from the Minnesota State Auditor’s Office related that the state’s cities are in worse financial shape now than they were in 2000. Though Fergus Falls has fallen on some of those hard times, the city has tried very hard to keep its property taxes constant in the past decade.

As Minnesota has cut local government aid (LGA) and other state funding to cities, the auditor’s report explained, cities’ spending and revenues have dropped while their property taxes increased. In 2009, the report stated, 37 percent of statewide city revenue was made up of property taxes, up from 23 percent in 2000.

Fergus Falls Finance Director Bill Sonmor said that while property taxes make up a bigger piece of the city’s revenue pie than they did in 2000, the reason for that is simply that the pie has gotten smaller. While the city did raise property taxes early in the decade to cover cuts in LGA, it has only raised property taxes since that time to correspond to regular increases in the cost of city operations.

That means that, instead of raising property taxes, the city cut its budget in 2008, 2009 and 2010 when a total of about $1.5 million in promised state aid was taken away.

“We have not been increasing our levies because of our aid cuts,” Sonmor stated. In fact, since the city only increased its 2011 tax levy by $15,000 and saw its economy boosted last year by several commercial ventures, property taxes are actually set to decrease for most city property owners this year.

Still, Sonmor said, money is tight and it’s getting tighter. In 2000, the city made about $7.6 million in revenue from property taxes, state aid and other sources. Last year, that number was about $9.6 million, but costs in doing business have risen much faster than revenue has.

“Everything costs more today,” Sonmor said. “We have cut throughout the city.” While the city tries to keep those cuts less noticeable, it still puts a strain on doing business.

Sonmor said a particular area where belt tightening has occurred is in city staff. Many retirements have not been filled by new employees in positions ranging from the police department to city hall to public maintenance workers. Those who are left have to shoulder the burdens of the people who have not been replaced.

“Throughout the city, we’re definitely working with a smaller staff,” he commented.

And, while the city has attempted to maintain funding to core services like the police department, fire department and street maintenance, other, smaller things have fallen by the wayside.

“We used to have flower gardens everywhere around the city,” Sonmor recalled. “You don’t see those around anymore.”

The city remains steadfast in its position that LGA cuts should stop, but it also wants to respect the economic needs of residents. And, so far, it’s done that by not punishing property owners for state aid cuts.

“In this economy, we don’t want to be (proposing) a levy increase,” Sonmor said.

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  1. Kathleen Hale March 4, 2011 at 8:36 pm <Link>

    Times are difficult everywhere, including Fergus Falls, and will only get worse as tme goes by. Why is the City building an ice arena in these difficult times and expecting taxpayers to pay for it?

  2. Dave Adams March 5, 2011 at 9:59 am <Link>

    Because the Hockey Association felt it was a proper entitlement for all the citizens of Fergus Falls and the surrounding area to fund their kids hockey arena. And, we will all be paying more with that new city sales tax. Never mind we already are paying more at the pump for a $100 a Saudi barrel of Oil.

    Hockey comes first. The Hockey Association runs the city council, did you not know that?

    Fergus Falls infrastructure dead last.

  3. March 6, 2011 at 1:57 am <Link>

    can’t help but to recall I was the only candidate predicting exactly this during the last 2 city council elections.
    told you so!

  4. March 6, 2011 at 2:44 pm <Link>

    according to http://www.michaelmoore.com/words/mike-friends-blog/america-is-not-broke,
    ontrary to what those in power would like you to believe so that you’ll give up your pension, cut your wages, and settle for the life your great-grandparents had, America is not broke. Not by a long shot. The country is awash in wealth and cash. It’s just that it’s not in your hands. It has been transferred, in the greatest heist in history, from the workers and consumers to the banks and the portfolios of the uber-rich.

    Today just 400 Americans have more wealth than half of all Americans combined.

    Let me say that again. 400 obscenely rich people, most of whom benefited in some way from the multi-trillion dollar taxpayer “bailout” of 2008, now have more loot, stock and property than the assets of 155 million Americans combined. If you can’t bring yourself to call that a financial coup d’état, then you are simply not being honest about what you know in your heart to be true.

    And I can see why. For us to admit that we have let a small group of men abscond with and hoard the bulk of the wealth that runs our economy, would mean that we’d have to accept the humiliating acknowledgment that we have indeed surrendered our precious Democracy to the moneyed elite. Wall Street, the banks and the Fortune 500 now run this Republic — and, until this past month, the rest of us have felt completely helpless, unable to find a way to do anything

  5. William Schulz March 8, 2011 at 9:04 pm <Link>

    Hey, Jamie, did MADMAN MICHAEL MOORE tell you that he is one of those so called 400 people? Did he tell you that they and the remainder of the top ONE PERCENT of income producers pay 47% of all the income taxes in the country. And it is fortunate that they do, for more than 47% of the people in this country pay ZERO, ZIP, NADA in income taxes, and about 22% not only pay no taxes, they get so called “working poor” tax refunds (of taxes they don’t even pay in the first place) , all paid for by those mean spirited 400 whom MAD MICHAEL and his fellow America hating lefties hate so much. And even that claim that 400 Americans have more wealth than half of all Americans combined is bogus. How? First, he means the half of all Americans who have no wealth at all, for they choose to game the system and live with their snouts in the public welfare trough, they spend their welfare checks as quickly as they come in, and from the records we have right here in Minnesota, our welfare credit cards are used in Hawaii resorts, Las Vegas casinos, Acapulco cabanas, liquor stores, in Florida for winter sojourns.
    Secondly, the 400 don’t own all that wealth, they own stock in companies (and seldom controlling percentages of stock) which employ roughly half the working people. Mad Michael wants us to believe that because someone owns stock in say, IBM, the stockholder controls the total assets of IBM and “owns” them, rather than perhaps a one hundred billionth of the assets, and he even has argued that if you own stock in a company, you have control over the personal assets of all its employees, their bank accounts, homes,cars, furniture, everything. And that is totally insane. Unfortunately there ares till about 8 to 11 percent of Americans who at any given moment will swallow his gaarbage. He had to have a lot of suckers to build a personal wealth estimated between 600 and 800 million dollars. And he laughs at bis disciples all the way to the bank.

  6. March 8, 2011 at 11:56 pm <Link>

    I hope all you working stiffs who see federal, state and in some cases local taxes taken out of your check every week realize that you don’t pay income taxes. You should understand that Bill Schulz is pushing that same old BS for the wealthy that he does for the oil companies.
    He means to make you feel like you are just a bunch of freeloaders riding on the coat tails of the wealthy because they love you so much.

    Here’s the snake oil in Bills pitch, he’s right you don’t pay income tax. Income tax is what the wealthy pay on a quarterly basis as an estimate of what they project they will owe at the end of the year. Because you don’t do that you don’t pay income taxes. But you do pay “payroll taxes” and you pay them every week not every four months and you pay payroll taxes at a higher rate than the wealthy.

    The apologists for the wealthy love to say things like “ONE PERCENT of income producers pay 47% of all the income taxes in the country” Big deal, I could give a rats butt what percentage of taxes the wealthy pay “AS A GROUP”, what matters to working people is that the wealthy pay their fair share as an individual. And for most of the wealthy it doesn’t matter what their individual tax rate is because they don’t pay it anyway, they have more tax dodges and schemes than you have hairs on your head. Even Warren Buffett admits that his secretary pay her taxes at a higher rate then he does.

    Further tearing down Michael Moore does not lend credibility to Bill Schulz’s arguments, it just proves he hates wealthy liberals as much as I hate wealthy conservatives. The only difference is I’m honest about it.

    Lastly, any percentage figures Bill uses to bolster his arguments are as stinky as the place he pulled them from and as suspect as his reasoning. Look at your next paycheck, are taxes taken out or not. Who are you going to believe Bill Schulz or your lying eyes?

  7. March 9, 2011 at 2:47 pm <Link>

    I concede nothing Bill. I merely said that “The apologists for the wealthy love to say things like “ONE PERCENT of income producers pay 47% of all the income taxes in the country”.
    I stand by my last comment.

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