By Sarah Light, staff writer

Like many other area citizens, Albert Lea residents soon will see an increase in their property taxes.

Specifically, with a city tax levy increase of $466,550 to be adopted Monday, a $100,000 homeowner can expect to see an annual increase in personal property taxes of $19.27 &8212; at least as far as city taxes go.

&8220;The city has really tried to do their best, but with so many years of reduced LGA (local government aid), we didn&8217;t have any other step but to increase the tax levy,&8221; City Finance Director Rhonda Moen said.

When the Albert Lea City Council voted to approve the proposed 2008 budget in September, the increase was estimated at $10.12 in city taxes. However, when numbers about tax capacity from Freeborn County came back lower, that estimate changed.

The actual levy that the council voted on remains the same, however.

Under the proposed 2008 budget, the city&8217;s levy will be set at $4,475,700 &8212; a cost which includes expenses to operate the general fund, permanent improvement revolving bonds debt service, and capital improvement bonds debt service.

The general fund budget will be set at $14,348,970, a number which is actually down about $50,000 from last year.

Because of this decrease in the general fund budget, city departments were put in the position to decrease spending, even as health insurance and wage costs have increased.

With all of these changes, Albert Lea&8217;s local government aid was also reduced by $289,000. This means the city is now getting only 37 percent of its general fund revenue from this source. This is the lowest this has been in at least six years.

The rest of the general fund revenue comes from other intergovernmental revenue, property taxes, licenses and permits, fines and forfeits and other miscellaneous income.

&8220;It&8217;s unfortunate the city has been so dependent on LGA,&8221; Moen said. &8220;But in a small way it&8217;s nice to see the levy go up because it makes us responsible for a larger part of our budget.&8221;

It&8217;s very difficult, however, to take an increase back to the taxpayers, she said.

To try to balance this out, the city has also planned to reduce the gross receipts tax &8212; on natural gas and electricity sales, as well as cable franchise services &8212; for 2008, which will result in a cost saving measure to the Albert Lea users of these services.

Under the proposals to be voted on Monday, the gross receipts tax will be reduced from a 5 percent tax rate to a 4.5 percent tax rate for 2008. This would affect services through Alliant Interstate Power, Freeborn-Mower Cooperative Services and Charter Communications.

Moen said for homeowners with utility bills averaging out to $150 a month, they would save about $10 a year.

&8220;They will have some savings in that way,&8221; she said.

Moen added that she hopes people recognize the value of all the services they are getting for their city tax dollars &8212; including access to the library and fire and police protection.

&8220;I don&8217;t know if people think about the value of what they&8217;re getting,&8221; she said.

For the full Powerpoint presentation given at the truth-in-taxation hearing earlier this week, contact Moen. All departmental budgets and funds identified in the budget have a detailed description and justification on file.