FAIRMONT–The Fairmont City Council meeting garnered a crowd on Monday night as the council held a public hearing amending an ordinance establishing a rural and urban service district. Owners of 32 “rural” properties within city limits were notified as their properties could be reclassified as urban and thus taxed at the full rate, rather than at 20 percent, for services.

The council considered the following criteria for placement of parcels in the urban district: Platted parcels adjacent to sewer, water and a public right-of-way, 20 acres or less; Parcels adjacent to a paved road, sewer and water, 20 acres or less; Parcels of any size with a residence/household present; Parcels with sewer and water adjacent, served by a paved road with curb, gutter and driveway curb cut on at least one side, 20 acres or less; Properties currently designated as rural that are completely surrounded by urban district

properties and Properties adjacent to a public right-of-way with sewer and water service, 25 acres or less

and surrounded on three sides by urban-designated properties.

About six residents that were affected by the change spoke to the council during the public comment portion.

“I receive no benefits from the city. I can’t understand why it should be changed from agriculture, what it is, I would be just as well off being in Fairmont Township as to be annexed,” one resident said.

Another person said they bought a property and built a house and shed but have no city electric, water, sewer or gas.

“I don’t understand how I pay city tax the same as someone that lives in town that’s provided these services when I don’t have that provided to me,” they said.

For the next year the resident said their taxes would go up $2,000 with the change.

One resident asked if they will start getting the various services like water and electric to their property if they’re paying taxes for them.

Interim City Administrator Jeff O’Neill said that the reasoning behind how the criteria was set up is because for properties that have a residential use, the habitants are getting access to police department and park services, etc.

“When a home and resident is established there’s a sense that this is an urban use for that home and that home should then contribute to costs paying for services,” O’Neill said. “It’s true in some cases that there’s no electric and no county road service… so in those instances council has the opportunity if you want to make exceptions for those situations.”

He said another reason is because there’s the opportunity for property owners to separate larger parcels from one to two, with the smaller one with the home qualifying as urban and the larger not qualifying.

“There is an opportunity for the property owner to react to the situation to manage their property tax payments accordingly,” O’Neill said.

Council Member James Kotewa asked whether any residents could go back and appeal the decision and O’Neill said there is the option to do that.

Council Member Randy Luebow brought up the fact that the council has been talking about this change on and off for about five years. He admitted that he didn’t understand some of the changes.

“I am a little confused on why we would consider a house that is inside of city limits as urban if they don’t receive any of the basic services that we offer. The sewer, the water, the electric,” Lubenow said.

O’Neill said that in a lot of cases it’s a residence occupied by a family and that they might not get direct services like sewer and water, but that there are other services beyond that that qualifies them as being urban.

“I believe that was the thinking at the time,” O’Neill said.

Council Member Britney Kawecki agreed that there are other amenities that people can take advantage of, which is why they would be considered as urban.

“I think that city staff did the best that they could to try to figure this out. We’re always willing to take another look next year,” Kawecki said.

It was said that the list of properties and their classification needs to be submitted to the county by Aug. 1.

Kawecki made a motion to pass the change. When it did not receive a second, the council considered changing any of the criteria.

Council Member Jay Maynard brought up the idea of being more specific about the criteria for parcels of any size with a residence/household present.

“The size of the house has to be taken into consideration, too,” Maynard said.

Lubenow asked about snow removal on some of the roads in affected areas, specifically on Lake Aires Road. He asked if the Fairmont Police Department or the Martin County Sheriff’s Office would respond to an emergency. Kotewa said that Fairmont police would respond.

“I thought when we were first talking about this, our objective was people who were using the utilities that live out in the country. Those are the people we were looking at,” Lubenow said.

O’Neill said that the council could have a second reading at its next meeting on July 28 so if council could give direction, staff could tweak the ordinance amendment and bring it back at that meeting for possible adoption.

Kawecki asked how hard it would be to find out what properties didn’t have water, sewer or gas and city engineer, Tyler Cowing, said he could figure it out within the week.

However, O’Neill pointed out that there are some small parcels that are getting urban services.

“If it’s your intent to try to better fine-tune these parcels that are on large tracts without services, we would try to make sure that we don’t inadvertently exclude those that are really more urban in character because they’re on smaller lots but perhaps closer to the city and those kinds of things,” O’Neill said.

Lubenow said he would prefer that if property owners live on a county road and don’t receive any utilities from the city, just police services, that they would stay rural and pay at 20 percent regardless of the size of their property.

Maynard made a motion to give direction to staff and update the next reading with criteria based on discussion which Kawecki seconded. The motion passed.

Following that, there was a public hearing on another amendment to an ordinance dealing with rental housing standards.

Community Development Director, Pat Oman, explained that the council adopted the current rental housing ordinance in 2022 but that earlier this year it discussed amending the ordinance and adding some escalatory language.

“There are no fees and penalties and no consequences to actions that aren’t followed in the ordinance. I think there was a history of there wanting to be but they weren’t included,” he said.

Oman said that VRBOs and other short term rentals would also be excluded.

No one spoke up during the public comment portion and after some more explanation by Oman, Lubenow said, “We’ve been here before. We’ve walked down this path of changing the ordinance. How do we as council know there’s a commitment from city staff to follow through with it?”

Oman said that the the system is labor intensive and that staff has been filing a lot of paperwork and keeping track of all properties considered rental housing. He also pointed out that the city is in the process of setting up a new permitting and data collection software that will assist.

“Leveraging that technology is going to make it more efficient and I can assure you that we’re working very hard to make sure that people are in compliance,” Oman said.

Lubenow made a motion to approve the first reading of the ordinance. The motion passed.