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City sales tax raises $7.7M for variety of projects

WILLMAR -- Willmar's local option sales tax has so far raised $7.7 million for four local projects since the tax went into effect five years ago, according to information given to the City Council's Finance Committee.

The half-cent tax was approved by voters on Nov. 2, 2004. As of June 30, 2010, the tax had raised $7,758,351, said City Finance Director Steve Okins.

Okins clarified for committee members the language in the referendum and in state statute. He said there seems to be some confusion about the dollar amount that the law allows the city to raise. Some had thought the law allowed the tax to raise up to $8 million and then be retired.

However, Okins said that that is not what the law states.

The law lets the city issue up to $8 million in general obligation debt to pay for the four projects.

In order to retire $8 million in debt, more than $8 million must be raised, he said. Rather than issues bonds, however, the city has been paying cash for the projects.

The length of the tax is seven years and will expire in 2012.

The tax is intended to pay for four projects: redevelopment of the old airport into an industrial park; construction of bike paths; construction of the connection of the Civic Center and Blue Line Center; and purchase of 65 acres of former Willmar Regional Treatment Center land located west of U.S. Highway 71.

So far, the city has spent $5,368,765 on industrial park/airport redevelopment; $220,847 on bike paths; and $1,071,840 on the Civic Center/Blue Line Center connection.

No money has yet been spent on the 65-acre parcel.

In other business, the committee began discussing the 2011 mayor's proposed budget. Mayor Les Heitke presented the $25.6 million budget to the Finance Committee on Aug. 23.

The committee will discuss the budget during the next couple of months, leading up to approval of the budget later this year.

Okins explained to the committee the state formulas that are used to calculate the local levy limit base.

In other discussion Monday, committee chairman Denis Anderson said he will allow time at the beginning of each committee meeting for citizens to comment about the 2011 mayor's proposed budget.

The time slot would be similar to the open forum held during City Council meetings.

David Little
David Little covers the Willmar City Council, Willmar Municipal Utilities and other city news.
(320) 235-1150