Farmington council rejects tax levy on a 3-2 vote

Talk about it

In the end, as Farmington mayor Todd Larson says, “It is what it is.”

But what it is remains to be seen after a surprising vote during Monday’s Farmington City Council meeting put the 2013 budget and tax levy on hold, and forced city administrator David McKnight to find another $152,000 in cuts before Dec. 17.

Council members rejected the 2013 proposed tax levy of $8,718,968 on a 3-2 vote. Instead, council member Jason Bartholomay made a motion to set the tax levy at the same amount as 2012. He, Julie May, and Terry Donnelly voted in favor of the motion, rejecting McKnight’s proposed levy.

“I personally, as a council member, feel there is more we could do. With the unknowns in 2013, with the all the fiscal cliff talk going on, the continued reduction in home values … the shift to the commercial sector. We can’t be hypocrites here and say we care and then have tax increases which we know, we all admit, yet hit that sector much, much harder, and then all sit up here and say we want to increase commercial development,” May said.

The $8.7 million levy presented Monday came after nine months of budget planning. It represented a 1.79 percent increase over the 2012 tax levy of $8,565,982, yet most residential property tax payers would have seen a decrease in the amount they were to pay if the presented levy were approved. Commercial and industrial properties would have seen an increase in taxes under that scenario.

The commercial and industrial properties will still receive an increase in taxes next year, council member Christy Jo Fogarty pointed out.

“I just want to make sure people understand, and the decision has been made, but this doesn’t prevent businesses from seeing an increase in their taxes. Businesses are still going to see an increase in their taxes, despite what this city council does here tonight,” Fogarty said.

Council could not vote on the 2013 budget because the budget, as presented Monday, is in line with the $8.7 million proposed tax levy. State law requires cities to approve a balanced tax levy and budget.

Instead, council members directed McKnight to find another $152,000 in budget cuts. That may, Fogarty pointed out, include elimination of employee positions in the final weeks of the year.

The vote stunned Larson, who apologized to McKnight and city staff afterward.

“I’m sorry that we went through nine months worth of work to come to the last minute decision like this, but it is what it is,” Larson said.

“We spent nine months working on the budget document and I thought it was a good, sound, solid document and I’m very disappointed how tonight went,” he continued before the end of the meeting. “By doing what we did tonight, I don’t want to say ‘wasted’ nine months, but we took a budget that I thought was sound and I thought everyone else thought was sound whether you agreed with it or not, and we poked some more holes in it.”

On Tuesday, Bartholomay admitted he was surprised by the council vote, even though he made the initial motion to hold the levy at last year’s rate. Bartholomay said he has been consistent in his message that the city shouldn’t raise taxes right now. May, too, has conveyed that message during budget workshops this year.

“I didn’t think anybody was going to second my motion. I was shocked. The vote surprised me, especially with Terry. I didn’t know where he stood,” Bartholomay said.

Donnelly said he went to Monday’s meeting fully expecting to approve the proposed budget and levy, but changed his mind once Bartholomay’s motion was on the table.

“I just think a zero increase is the message to send,” he said Tuesday. “The opportunity just popped up, and I decided I’m going to support it though the timing was unfortunate.”

Donnelly was happy with this year’s budget process, and supported McKnight’s plans through the past few months, but he never really warmed to the idea of increasing taxes for commercial and industrial properties. He knows those property owners will still see an increase, but at least it will be a little less, he said.

“This just shows we have listened. We always say we care about business and this is just a way for us to show it. At least we’re trying. That’s part of what went through my mind,” he said.

Bartholomay is reluctant to make suggestions on just where the cuts should be made in the 2013 budget.

A budget work session has been scheduled for next Monday, Dec. 10. Council is required by law to approve a balanced budget and tax levy by the end of December. McKnight indicated he will give council an update on his progress by the end of the week. The revised budget and tax levy will be presented at the Dec. 17 regular city council meeting.

Tags: local government, news, farmington