City holding the line on property tax levy

by Emmitt B. Feldner of The Review staff

PLYMOUTH – The city’s property tax levy for 2016 is a rerun – for the sixth straight year.

City Administrator/Plymouth Utilities Manager Brian Yerges presented the proposed 2016 city budget to the City Council Tuesday with a $4,008,042 levy – the same as the 2015 levy and every levy going back to 2011.

A public hearing on the proposed $7,238,438 budget will be held during the council’s meeting Tuesday, Nov. 10, after which the council will vote on the document.

The equalized property tax rate to support the budget would decrease by 24 cents, from $6.87 per $1,000 of assessed valuation to $6.63, Yerges said. It marks the second straight year the tax rate has declined.

He said the drop is thanks to an increase in total property values in the city for the second straight year after five straight years of decline.

“What that indicates is that we’ve had some development and new growth (in the city) and that property values are starting to come back,” Yerges commented.

Property tax bills for 2016 will continue to include a $24 garbage collection fee and an increase in the recycling fee from $9.50 to $19. Yerges noted that the increase in the recycling fee – designed to cover lost revenues from the state for recycling costs – was approved by the council when it adopted the fee in 2014.

Overall, state shared revenue and aids remain flat, Yerges said, at roughly $1.18 million.

The city’s debt service will remain at roughly $500,000 in the proposed budget, Yerges told the council.

“If you go back eight or 10 years, our annual debt service was about $1 million,” he pointed out.

The debt service is expected to remain between $500,000 and $600,000 annually for the next six years, Yerges continued.

“We wouldn’t be looking at adding any debt for another five or six years,” he said.

Looking at Plymouth Utilities, Yerges said there would be no increase in electric or water rates, but that the city will be looking for approval to increase sewer rates.

He blamed that in large part on the announced closing of the Dairy Farmers of America Borden plant in the city at the end of the year.

“(That) closing is going to have a significant impact on Plymouth Utilities revenues,” Yerges informed the council. The facility accounted for 13.3 percent of sewer utility revenues, he said.

The plant closing will also negatively impact electric and water revenue for the utilities, but those decreases can be more easily absorbed, he said.

Yerges pointed out that the last sewer rate adjustment was seven years ago.

The proposed budget includes a set aside of $250,000 for future upgrades at Stayer Park in downtown Plymouth and funding for a human resources specialist position starting next summer.

“It’s nice to see that for six years running the tax levy remains the same,” Alderman David Williams commented. “We need to congratulate Administrator Yerges for his efforts on that behalf.”

USDA loan manual approved

The council approved the adoption of a manual to administer the revolving loan fund which will be created from a USDA Rural Development grant to the city.

The $300,000 grant/loan, announced earlier this month, will be used by the city to help rehabilitate the building at 133 E. Mill St. into a cheese-themed retail and heritage center and apartments.

The city is required to provide a $100,000 match to the USDA grant, meaning that when the money is repaid to the city it will create an economic development revolving loan fund of $400,000 for the city.

“This allows a broader range of projects than our existing RLF (revolving loan fund),” Yerges said of the guidelines for the USDA program. “Loans could be granted to non-profit agencies or to other government projects.

The rules also do not include a specific job creation or retention requirement like the city’s current RLF, which was created two decades ago with several Community Development Block Grants.

Repayment on the initial $400,000 for 133 E. Mill St. are deferred for two years, according to Yerges, then will be repaid over the next eight years.

The city can begin making loans from the new RLF as funds are repaid. Yerges added that the city can apply for other USDA grants in the future that could eventually enhance the RLF as well.

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