2020 City budget outlook: No new taxes

City Manager Tom Barry will present the preliminary 2020 budget at the Minot City Council’s Aug. 5 meeting. While we haven’t seen all the details yet, I can share with you the clear direction I gave at the State of the City and the direction council guided city staff in during this process:

There will be no property tax increases in the 2020 city budget.

The City’s portion of the 2019 property tax bill, on a median assessed home of $178,000, was 129.23 mills or $1,035. This made up 36.86 percent of your total consolidated tax bill.

For the 2020 budget, we anticipate property owners will actually see a reduction in mills for the City’s portion of their overall property tax bill. The reduction will be directly related to reducing the mills associated with the Recreation Department being moved to the Minot Park District. Remember, state law prohibits the preliminary budget from going up. It can, however, go down.

A reminder that the City is only one of four taxing entities you’ll find listed on your property tax statement. We don’t know yet what the numbers will look like for Ward County, Minot Park District, or the Minot Public School District. The City has no influence or control over those entities.

This anticipated reduction in the City’s property tax levy was part of the long-term plan we’ve been following for the past two years. While the property tax increases in 2017 and 2018 were difficult for city residents, they were also necessary to put us back on a path of more fiscally responsible and realistic budgeting.

As we’ve discussed several times, the City has made significant improvements in efficiency and reduced operating expenses. In fact, we’ve slashed more than $5 million from our operating budget since 2017. We’ve eliminated more than 20 full-time positions, even while expanding and improving our services to residents thanks to efficiencies like using automated trucks to collect trash.

Just as important, we’ve worked diligently to increase the amount of funding from multiple sources. Sales tax collections this year are trending ahead of our estimates. The new Hub city formula, which was approved as part of House Bill 1066 (also known as the Prairie Dog Bill), means Minot is projected to receive approximately $4 million more per biennium than in previous years. Conservative estimates have Minot receiving $12.56 million for the 2020-21 biennium, compared to $8.036 million in 2017-19. That additional funding can be used in a variety of ways, including paying for road maintenance or other items that are funded through property taxes.

City staff and council members spent considerable time in Bismarck this year at the Legislature, testifying on behalf of the City on the Hub city funding formula and other important issues while working in conjunction with our area legislators. Now, we’re expecting to begin seeing the results of everyone’s efforts. The additional Hub city funds will make a real difference in our future budget models.

In reality, the budgeting process never stops at the City of Minot. As soon as one year’s budget is approved, work essentially begins on the next year, and our five-year projects are constantly updated, and are looking favorable for the future. The Council has set an arduous task before the city manager and the department heads to maintain or reduce property tax levels for the 2020 budget. I’m confident the preliminary budget we will see on Aug. 5 will accurately and realistically reflect the direction set by the members of the City Council.

Sincerely, City Hall

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