Fairmont weighing half-cent tax hike
FAIRMONT — The possibility of a second half-cent local option sales tax earmarked for street improvements inched ahead at the Fairmont City Council meeting Monday.
The city currently has a half-cent tax approved by voters in November 2016 that generates about $600,000 per year. The council has dedicated the funds to a community center.
Mark Sievert, interim city administrator, told the council that the tax must be approved by the Legislature, which looks for regional significance in a proposal, and that safe streets for all motorists could qualify. He asked for the council’s approval so all required paperwork can be in the hands of the relevant tax chairs by the Jan. 31 deadline.
Erik Ordahl, an attorney with Flaherty & Hood, the city’s interim civil council, outlined the time table for the sales tax. If the council passed a resolution requesting the tax, the Legislature would have to pass a special law approving it. The proposal would then go on the ballot in the next general election, which is in November. If it gets support from the majority of the city’s voters, the tax still would have to get final approval from the council before it could go into effect.
“So the taxpayer will be the one who eventually approves or disapproves of this,” said Councilman Wayne Hasek.
“This is just step one,” Mayor Debbie Foster noted.
Councilman Tom Hawkins said he was “generally not in favor”of the additional sales tax, preferring instead to use franchise fees and infrastructure charges to provide street improvement funds.
“We added the half-percent sales tax for the community center so now we’re on par with about every other community that has that, except for Mankato which is 1 percent,” he said. “I think it would be more of a burden on our businesses to have an extra half-percent tax over anywhere else.”
He planned to vote against the resolution “unless somebody can convince me that this is not going to harm our local businesses” and suggested the possibility of reconsidering the tax next year.
Sievert pointed out that the law requires the proposal to go before the voters in a general election, so delaying it a year would actually push it back to the 2022 election.
“But the taxpayers will get a chance to vote for it,” Hasek said. “I think we need better streets. If it was just going to raise the tax on people, I’d be against it, but since the people get to vote for it, I will be for it.”
Randy Lubenow downplayed the impact the added tax would have on businesses.
“I’ve never went to Mankato or Rochester and said, ‘I can’t buy that because you have more sales tax here,'” he said. “I think we’re losing more business by having poor roads.”
Ruth Cyphers said she has many customers outside of Fairmont and questioned whether it would impact their decision to do business with her.
On a motion by Bruce Peters and a second by Hawkins, the motion passed unanimously.
In a related matter, the council postponed a decision to hire a lobbyist to advocate for the local option sales tax at the Legislature.
Turning to another matter, the council unanimously selected municipal advisers Baker Tilly of St. Paul to spearhead the search for a new city administrator. The company has merged with Springsted, the firm that the city used to hire its current police chief, finance director and city engineer/public works director so the city has a successful history with them.
Baker Tilly’s proposed timeline shows the process of hiring a new administrator should be completed by the end of April. The firm will charge an all-inclusive fee of $24,500 for the project.
In other business, the council:
o Appointed Judd Schultz of Minnesota Valley Action Council as a qualified third party, as required by law, to work with relocating the residents of Trees Trailer Park during the closing of the park.
o Approved recording and broadcasting council work sessions in addition to regular and special council meetings. Gemini Studios will provide the service at a cost of $80 per hour per person with two people needed for the job. Wayne Hasek was the sole vote against the proposal.
o Approved the slate of officers for the Fairmont Fire Department: Brandon Scott, chief; Bryan Kastning, assistant chief; Colby Whitmore, captain; Tim Miller, first lieutenant; Rob Iverson, second lieutenant; and Matt Streit, secretary.
o Set a public hearing on a 5 percent increase in soft water rates for 5:30 p.m. Feb. 10.
o Set a public hearing on a 5 percent increase in wastewater rates for 5:30 p.m. Feb. 10.
o Set a public hearing on rezoning 924 Lake Ave. from heavy industry to general business for 5:30 p.m. Feb. 10.
o Set a work session for Feb. 3 with Pamela Whitmore of the League of Minnesota Cities who will work with the council on collaboration, mediation and open meeting laws.