Tax increase needed for future projects, maintenance
By Chad Koenen
For the second consecutive year the City of Henning is proposing a large increase to its tax levy.
After increasing the tax levy by 12.3 percent in 2022, the City of Henning is proposing a 20 percent preliminary tax levy increase for next year. If approved later this year, the 20 percent tax levy increase would be just the third time since 2009 that the city has approved a larger than 4.2 percent tax levy increase.
After years of stagnate to no tax levy increases, Henning Public Utilities Supervisor Ted Strand said the city needs to start replenishing its reserves as several expansive projects have taken place in the past year and will continue next year with the Highway 108 project. Over the past year alone the city has completed a project on Inman St., replaced the lift station and continued to make utility upgrades in advance of next year’s expansive utility project through the heart of Henning.
In addition to the utility projects, he said the city has discussed some enhancements at Amundson Park and the festival grounds for things like playgrounds, ball field repairs and community enhancements to help bring people to town.
Both Strand and city clerk/treasurer Jenna Kovarik said the projects being discussed by the city council are simply for repairs or basic projects in the community, nothing exorbitant or elaborate that would burden taxpayers for future generations.
“It’s just a lot of things around town that we are trying to fix and improve,” said Kovarik.
All of the projects cost the city money and Strand said the city’s costs continue to go up due to rising inflation just like individual residents in the region.
While the small tax levy increases, and in many cases tax levy decreases have kept taxes low in the city, it has also resulted in the city needing to rely on its utility funds and reserves to complete some of the projects in the city, or simply trying to patch a project instead of properly repairing it at a higher cost.
If the tax levy is approved as currently proposed, Strand said the city will receive approximately $44,000 in additional revenue next year. By comparison, the City of Ottertail is proposing a 30 percent preliminary tax levy increase in 2023 and Kovarik said many other communities in the area are also proposing large tax levy increases next year to keep up with rising costs and inflation.
“It’s not just us either, a lot of other towns around us are proposing increases as well. We are not alone,” she said.
Proceeds from the tax levy benefit the city and allow it to provide services like fire, police, city staff and maintain the public utilities.
Kovarik said the average property owner in Henning would see an increase of $3-4 a month in their property taxes if the proposed levy is adopted later this year.
Even though the city council is weighing its second straight large tax levy increase, it follows several years of low-to-no increases in property taxes. For example the Henning City Council approved a decrease in the tax levy of 2.3 percent in 2019, before raising the levy just 2.8 percent in 2020 and 1.65 percent in 2021. Since 2009 the city has approved a tax levy that was either less-than a one percent increase or decreased the overall tax levy seven times, the last coming in 2019.
During its regularly scheduled meeting last week, the Henning City Council said it will hold off on adopting its preliminary tax levy to gather more input from the community about the proposed increases. The city council said community input is encouraged to let them know what the community’s feelings are toward the potential tax levy increase.