Jill Schramm/MDN City of MInot Council Member Mike Blessum speaks to the city’s proposed budget as Mayor Tom Ross and City Clerk Mikayla McWilliams listen at left.

The amount of money the City of Minot carries in reserve came under scrutiny during the Minot City Council’s discussion of a 2025 budget Tuesday.

The council approved a preliminary budget of $227.7 million budget, which includes a property tax levy for $28.52 million, or an estimated 115.07 mills.

The dollar levy is the same as 2024, although the mill levy is down 4.85 mills due to increased valuation in the city. The tax per $100,000 of home value is estimated to decline by $21.87 – from $539.69 in 2024 to $517.82 in 2025. About 71% of property taxes collected go into the general fund to support services such as police, fire, traffic control and streets.

The amount of reserve cash in the general fund was a concern of council member Mike Blessum.

“It feels a little bit like our practice is to over-budget in terms of expense to drive reserve revenue to have it available for later,” he said. “Do we have to be putting away that level of dollars? Because I just want everybody to understand, when we don’t spend the money that we collected from the public, we have overtaxed them. We don’t give it back. It’s gone. It’s gone from their pocketbooks.

Blessum questioned the city’s practice of maintaining several months of operating revenue in reserve.

City Manager Harold Stewart explained the need for having reserves for unexpected events. He also explained having the reserves does enable the city to pay cash for projects that otherwise would require bonding and incur interest expenses. However, the city’s policies for reserves are excessive, in his opinion, he added. It amounts to seven months of reserve revenue rather than the three to six he would advise, he said.

Blessum responded that the city’s level of reserves makes decision making too easy. If a project comes along, the city draws from reserves to pay for it rather than considers the best use of its funds, he said.

“Over time, I think we may need the council to take a look at what our reserve policies are and to give direction to city staff in what that reserve should look like, because I’m not comfortable with the direction that we’ve gone now. We’re taking reserves from the people and what they should be putting in reserve in their checking accounts and their savings accounts,” he said.

City Finance Director David Lakefield said underspending the budget has driven the general fund reserves in the past. In the past year, the city spent the bulk of its budget but built fund balance because of unanticipated revenue, primarily in interest income, he said.

“We’re forecasting here interest revenues that are 14, 15, 16 months down the road, so there’s not a great deal of certainty,” he said.

Lakefield also noted the city has budgeted for staff positions, particularly in the police department, that the city was unable to fill, resulting in taxes collected to fund those positions going into reserves. Those reserves can be used to fund police officers when they can be hired, which Blessum said is a good plan.

“I can’t imagine a more perfect way to spend it. So if that allowed us to drop back down, that would make perfect sense to me,” he said.

Stewart also mentioned city staff are looking at using money in reserves to catch up on road maintenance. If the council would provide $10 million a year from reserves, the $16 million cost estimated to keep roads maintained could drop.

“We can invest some cash in reserves now to increase the quality of our streets but then also decrease the annual cost of maintaining those on a regular basis,” he said.

Blessum said he could support that use of reserves, calling road maintenance a core function of government.

“So, I’m glad to hear that. I think that’s great,” he said.