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The Albert Lea City Council on Monday unanimously approved a 4.77% increase in the overall tax levy for 2024, down slightly from the preliminary increase it passed in September.

The total $7.69 million tax levy represents a $350,500 increase from the levy in 2023.

City Finance Director Kristi Brutlag said there is an about $1.768 million increase in the general fund budget of $19.88 million. Of the increase, almost $792,000 came from personnel costs, including changes due to open enrollment and implementation of union contracts. There is also an increase of almost $582,000 in supplies, services and other charges and about $395,000 in transfers.

Third Ward Councilor Jason Howland, who motioned to approve the levy, said there was a period for almost 10 years when the council had a 0% increase in the operating levy.

“The honeymoon’s over,” Howland said. “The reality is that at some point it has to go up, and the price of goods and services continues to rise.”

He commended city staff who he said had done a good job for a long time to keep the levy at zero or much lower than other communities. He also commended getting the levy down from the original proposed 5.5% increase.

Brutlag said the average preliminary levy increase in Minnesota in 2024 was an 8.4% increase. Looking at 53 communities with a population between 10,000 and 30,000, the average preliminary levy was an increase of 10.11% for 2024. She noted Albert Lea’s preliminary levy was the sixth lowest levy increase in the state and the fourth lowest per capita.

“If you want to continue with the services that the city offers you, somehow they’re going to have to be paid for …” said 2nd Ward Councilor Larry Baker. “I think most people when they look at what the city offers, what the city gives for their taxes, I think if they were really honest with themselves, I think they would come to the conclusion that they get a pretty good deal.”

First Ward Councilor Rachel Christensen, who also served on the budget committee, commended both the council and staff for the hard work done on the budget and said they will always have to look primarily at how to do things most efficiently and effectively.

“I think a lot of times we have to walk a fine line here sitting on the council because we want this to be the best city in southern Minnesota — nah all of Minnesota, heck,” said Albert Lea Mayor Rich Murray. “To do that it takes funds. It takes funds to keep that arena open and to keep our police department out there and keep the fire department out there. All of those things take funds. But on the other hand, this council represents the taxpayers of the city of Albert lea and we take that very seriously also.”

He said council and staff have looked closely at the budget, and he said he thinks they ended with a reasonable number, despite inflation.

Brutlag said the city’s 2024 budget comes 35% from local government aid and 29% from property taxes. Charges for services cover 14%; 12% comes from transfers from utility funds to cover overhead and 10% comes from franchise fees from gas, electricity and cable television.

Of the budget, 41% goes to support public safety, including police and fire protection, as well as inspections; 21% supports culture and recreation, including parks, the arena, the library, pool and the theater; 16% covers public works, including street maintenance and snow removal; 15% covers city council, administration, elections, communications and economic development; and 7% covers transfer funds for equipment replacement, such as police cars and street equipment.

The overall levy was made up of a general fund levy of about $5.726 million and a debt levy of about $1.965 million.

Brutlag said for a $100,000 home that saw no increase in valuation, city taxes would increase about $17 a year, while the same home that saw an increase in valuation to $101,510 would see an increase in taxes of almost $25 a year.

HRA levy

The council also approved a $250,000 levy for the Albert Lea Housing and Redevelopment Authority, which is up $100,000 from the 2023 levy.

The levy is expected to cover needed security updates at Shady Oaks.

The HRA by statute can levy as much as $252,640, based on a percentage of market value.

Water and sewer fees

The council approved several changes to the city’s fee schedule for 2024, including a 7% sewer rate increase and a 5% water increase.

The increase would bring the bill for a user of 6,000 gallons a month from $73.47 a month to $77.84 — an increase of $4.36 per month.

Brutlag showed a graph for comparison of the bills with other towns. For a user of 6,000 gallons of water in Austin, the cost is $90.49 monthly, including a storm water fee. In Marshall, it’s $115.28, in New Ulm it’s $82.38, in Rochester it’s $81.93, and in Willmar, it is $108.78.

She said the rates are looked at every year.

Other notable changes on the fee schedule include an increase in prime time ice at the arena from $180 an hour to $185 an hour. There’s also an increase in public works fees for things such as mowing, snow removal and street maintenance.

There’s an increase in police protection fees, as well as an update of some solid waste disposal fees.

Airport, Senior Center budgets

The council also approved budgets for the airport and Senior Center.

Brutlag said the Senior Center continues to see a loss in its cash balance at the end of the year. The city put in about $60,000 this year, and it is managed by the Albert Lea Family YMCA, with the YMCA seeing any revenues that come in.

Capital Improvement Plan

The council approved the city’s Capital Improvement Plan for 2024 to 2028, which included about $195 million in projects. Of that total, about $45 million in projects is slated for 2024.

Though the plan is in place, all 2024 projects over $100,000 still require separate approval by council resolution.  Projects that come in at $100,000 or less can be approved by the city manager. The council also has to approve individual projects if costs come in 20% higher than the original estimate in the plan, despite cost.

The 2024 projects include a portion of the wastewater treatment plant system upgrade, the reconstruction of the street at the Blazing Star Landing, a solar project at the wastewater treatment plant, the inclusive park, cleanup at the Blazing Star Landing, a solar project at the arena, a card security project, and a lighting update at City Hall.

The council is also considering a potential of almost $10.9 million in projects at the arena, pool, theater and bathrooms for the splash pad. It is slated to vote on the scope of those projects at its first meeting in January.