Preliminary levy increased by 15 percent
By Chad Koenen
With a number of projects on the horizon, as well as a need to address some aging equipment, the Henning City Council moved forward with a double digit increase to its preliminary tax levy.
During a special meeting on Monday, Sept. 26, the Henning City Council approved a 15 percent increase in its preliminary tax levy. The levy can be decreased, but not increased, when it is finalized at the end of the year. The large increase follows several years of stagnant or flat increases to Henning’s tax levy.
The city council had several options at its disposal on September 26, including one that raised the levy just 4.6 percent. However, Henning Mayor Darren Wiese said that increase just took care of the basic spending for the city next year and didn’t address a rising number of repairs that are all needed in the near future.
Henning Utility Supervisor Ted Strand said the repairs will not happen overnight, but a large increase in the levy next year will go a long ways to make future repairs. Strand said the Airport and Industrial Park roads are in need to be repairs, the city’s insurance could increase by as much as 50 percent, the city’s wage rate study is still being developed and the city will need a new computer at the water plant. The water plant computer project alone could cost $50,000.
“We want to fix things, but we have to have the money to fix them,” he said. “We realize we can’t do it all in one shot.”
Henning Police and Fire Chief Mike Helle said the costs for just about everything has substantially went up over the last year and echoed Strands remarks about the need for a larger tax levy next year.
Strand went on to say the city’s repairs have been building for quite some time and the levy itself could be decreased when it is finalized later this year should some of the costs for unknown things like insurance and the rate study come in lower than expected.
“Realize we didn’t get into this situation where we are over night. This has happened over a number of years,” he said.
Henning City Councilman Jim Haberer said the city will need to address some of the issues in the near future that have been put off for a number of years.
“All of that is just called kicking the can down the road,” he said.
Councilman Wes Johnson agreed with Haberer and said eventually necessary repairs must be addressed.
“Sooner or later there is not enough can to kick and you have to get something done,” he said. “So I think you are working in the right direction.”
While the preliminary tax levy was approved unanimously, when discussion turned to potential rate increases for things like the city-owned natural gas company, Wiese said the city council needed to keep in mind that local taxpayers could face a large bill next year given the rising rate of inflation, potential school building levy, as well as the city’s increase in its preliminary tax levy.
The council learned that the rate it pays for natural gas was locked in at $7, compared to approximately $5.40 last year and approximately $1.29 just three years ago.
The city did not set its new utility rate for natural gas at the meeting and will address the issue at a later date.
Wiese said should the 15 percent increase in the preliminary tax levy be approved when it is finalized at the end of the year, the result would be an approximately $5 increase per household per month. The potential increase would generate another approximately $30,000 in the city’s levy next year.
In addition to the preliminary tax levy, the Henning City Council reviewed its 2021 year-end audit.
Dean Birkhead, of Carlson SV, gave the city high praise for its work over the past year, despite a delay in completing the audit due to a transition in city staff.
Birkhead said the city’s general fund increased by just over $86,000 last year and all of the city’s enterprise funds showed a profit last year. Those enterprise funds include Willow Creek, natural gas, water, sewer and electric funds.
While the water and sewer funds showed a profit last year, Birkhead said the funds were assisted by a grant “and I think that is what pushed those numbers up for the current year, but overall all of the enterprise funds look like they functioned quite well for 2021.”