City Budget Includes Sales Tax Changes

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The 2018 budget approved by Minot’s city council last night includes a hefty increase in funding from property taxes – jumping almost five million dollars.
But it also makes changes to how the city’s two-cent sales tax will be spent.

Jim Olson has been looking into the figures.

Minot’s sales tax is currently divvied up like this – with half of one cent to pay local costs of the massive flood protection project that will see construction begin in the spring.
But the city’s 2018 budget calls for pumping more money into the flood control fund.

That’s done by taking the funds currently devoted to community facilities and most of the money earmarked for economic development.
In total, the city will be devoting nearly one full cent of the two-cent sales tax to paying for flood control.
And that’s going to be a big bill – estimated at 350-million dollars in local cost for protecting the Mouse River basin from future flooding.

The sales tax distribution plan came up at Thursday night’s final budget hearing in relation to the decision to cut in half the pay increase proposed for city workers.  Alderman Steve Podrygula proposed taking the half-million dollars needed for the full raise from already-dedicated facilities funds – money raised through the sales tax and promised to MSU, a children’s museum, and the zoo. That idea didn’t fly legally, prompting this responsde from Podrygula…

(Steven Podrygula, Minot Alderman) “I can’t see spending a million dollars on a cat house when we can’t spend half-a-million dollars on our employees, I’m sorry. That’s not something I’m willing to do so I’m going to oppose the budget.” (clapping)

In the end, aldermen agreed they need to study the way sales tax funds are dedicated, and how the city can make the pay and benefits packages for city workers more competitive with other public workers in the state.

(Steven Podrygula, Minot Alderman) “I think we need to start very quickly at equalizing the health insurance coverage. We may not be able to do it all in one year but I think we have to make them comparable, otherwise we’re not competitive.”

And there’s another change looming in the sales tax future – the NAWS project is nearly clear of legal blockades and the sales tax is the exclusive source of local funding for NAWS so another adjustment to the sales tax distribution could be coming soon.

In Minot, Jim Olson, KX News.

The city expects to raise about nine million dollars in revenue per penny of sales tax next year.

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