The Roseville City Council Monday night voted to increase the city portion of its property tax by up to 4 percent in 2012, with Council member Tammy Pust casting the lone vote against the levy ceiling.
“The purpose for this is not to exceed 4 percent,” said Councilman Jeff Johnson, who characterized the not-to-exceed levy increase cap as a “cushion of sorts” as consideration of Roseville’s 2012 budget kicked into high gear.
Four percent is more than the 3.4 percent tax-supported budget portion recommended earlier by William Malinen, Roseville city manager. But city officials also have recommended a separate 8.4 percent increase in non-tax supported spending, a $1.7 million boost from 2011 levels.
Christopher Miller, Roseville finance director, said most of the non-tax supported increase is expected from substantial increases in sanitary sewer, storm sewer and water costs from the city of St. Paul.
The expected wave of sewer and water utility costs are expected to boost rates paid by Roseville residential and business customers between 60 percent and 65 percent, said Miller. The proposed increases, which hinge on council approval in mid-December, could increase Roseville’s total annual city budget to more than $41 million.
Pust explained her vote against the proposed levy after the Council’s 4-1 vote. “I understand this (4 percent) is a frame. But since 2004, taxes in the City of Roseville have increased by a total of 31 percent,” she said, referring to the tax-supported portion of the budget.
Talk about setting budget caps followed Council debate on whether Roseville should issue bonds to pay for $27 million in capital improvement projects ‑ $19 million to improve the city’s park system and $8 million to build a new fire department to replace Roseville’s system of three fire stations.
Roseville Fire Department officials made their case for selling $8 million in bonds to pay for a new station on city campus occupied by Roseville City Hall and the police department.
Pust and Council member Tammy McGehee supported a voter referendum to allow city residents decide whether to sell the bonds. However, that measure was defeated 3-2, with Mayor Dan Roe and Councilmen Johnson and Robert Willmus supporting the bond sale.
“I respect the opinions of Council member Pust and Council member McGehee,” said Johnson. “I’m just taking this fundamentally another way.”
He cited historically low interest rates as one reason for funding the new fire station with city bonds. Even though interest rates are low, debt service for the median-value $215,000 Roseville home will increase $29 a year over 20 years to pay for the new fire station.
Other factors in the Council’s decision to issue bonds are low construction costs because of the still-sluggish economy, which could save the city 10 percent on building the station.
Said Johnson: “Just doing nothing is no longer an option.”
