Special Meeting of the Mazeppa City Council
Wednesday, November 30, 2022
The regular meeting of the Mazeppa City Council was called to order at 6:03 PM by Mayor Chris Hagfors.
The Pledge of Allegiance was said.
Present: Mayor Chris Hagfors. Council Persons Steve Liffrig, Dustin Wiebusch, and Erica Young.
Others Present: City Engineer Matt Mohs, Project Engineer Jake Pichelmann, John Clemens, John Gruhlke, and City Administrator Clerk Karl Nahrgang.
Absent: Councilperson Mike Hammes.
Motion by Young, second by Liffrig to approve the agenda. All in favor, none opposed. Carried.
Motion by Wiebusch, second by Liffrig to close the special meeting. All in favor, none opposed. Carried.
Special meeting was closed at 6:04 PM.
Motion by Wiebusch, second by Young to open the public hearing. All in favor, none opposed. Carried.
Public Hearing opened at 6:05 PM.
Administrator Clerk Karl Nahrgang used a spreadsheet provided by Mike Bubany at David Drown Associates to demonstrate the increase for monthly cost per household needed to pay for debt to build the wastewater treatment plant (WWTP) replacement, some collection system improvements, and water line improvement in the areas that the collection system will be upgraded.
Slides were shown that show that of 10 comparable cities in our area, Mazeppa was the 3rd lowest for sewer rates and for property tax rates. Mazeppa also carried the lowest debt per capita of any of the cities compared.
The Council wanted 3 plans presented for public comment. The examples used showed how much a customer would pay if it was financed 100% on rates, 100% by taxes, and a plan with 25% by rates and 75% by taxes. Drawbacks and positives for each plan were discussed for a sample home using 5000 gallons per month and valued at $200,000.
The 100% payment from tax levy would be lowest cost per month for this home, however more expensive homes would pay more per month than the sample home. The drawback is that residents with less expensive homes that may use more water may not be paying their fair share.
The 100% from rate increases plan would allocate cost to the user of the service and is the most expensive per month cost for the example home. Of course, the amount from a home that uses less water will be less. The drawback is that there is property value built if the community has updated water and sewer infrastructure. So more expensive homes and businesses that use less water would get a greater benefit than the example home at a lower cost.
The combination plan, in this example 25% from rates and 75% from taxes, would be a lower cost to the example household than the 100% rate increase plan. It would even out the cost over more types of homes. Those in less expensive homes but are greater water users would be covering a cost commensurate with their usage. The initial rate increase, while significant, would not be as difficult to manage as the 100% financed by rate increase. The second benefit is that the tax component would not be levied until 2025 when the project is completed, and the debt repayment begins.
Commenter question: Why there was not more money from the last increase?
City Administrator Clerk Karl Nahrgang explained that the previous increase of $5.00 per month on the sewer base rate that Council passed in 2020 was to assist in paying for the increased engineering cost for the wastewater treatment plan replacement, and extra services needed for analysis of the collection system. That increase was not as significant as would be needed to build funds for the project itself.
Commenter question: Why City water is not being extended to serve all parts of the City and why all older sewer mains are not being replaced?
City Engineer Matt Mohs said that the overall cost of a larger project would create a financial burden for the City that would make paying for future infrastructure projects difficult and move beyond the overall tax tolerance (ability to pay) of the community.
Commenter said that it was unfortunate that more people did not attend because this directly affects the amount the citizens of the community are going to pay for or be taxed to have these services provided.
Motion by Wiebusch, second by Liffrig to close the public hearing. All in favor, none opposed. Carried.
Public Hearing closed at 7:05 PM.
Motion by Wiebusch, second by Young to open the special meeting. All in favor, none opposed. Carried.
Special meeting re-opened at 7:06 PM.
Motion by Wiebusch, second by Liffrig to issue a temporary offsite liquor license to the Mazeppa Municipal Liquor Store to cater an event at the Mazeppa community center on December 2, 2022. All in favor, none opposed. Carried.
Motion by Wiebusch, second by Liffrig to issue a temporary offsite liquor license to the Mazeppa Municipal Liquor Store to cater an event at the Mazeppa community center on December 3, 2022. All in favor, none opposed. Carried.
Motion by Wiebusch, Second by Young to adjourn the meeting. All in favor, none opposed. Carried.
Meeting adjourned at 7:07 PM.