City Adopts 2024 Proposed Budget & Levy
On September 19, the City Council approved the City of Owatonna’s 2024 Proposed Budget and Levy with a 9.05 percent increase over last year.
The City strives to align tax capacity with population and business growth. In recent years, Owatonna taxpayers have benefitted from increased tax capacity due to new construction and community growth. The rate at which the City has taxed properties over the past five years has been offset consistently by Owatonna’s increased tax capacity. The City’s actual tax rate in 2023 and the one proposed for 2024 is lower than it has been in the past five years because tax capacity is growing. For instance, Owatonna’s 2023 tax capacity increased by 17 percent; however, the City levy only increased nine percent. For 2024, tax capacity is projected to increase by seven percent which helps offset the impact of the City’s proposed 9.05 percent proposed levy increase.
Two main components of the City’s budget are personnel and the Capital Improvement Program (CIP). The 2024 budget will include an annual increase in wages and steps equivalent to roughly 4.5 percent of the overall levy (roughly $700,000). The City must also plan to fund State-mandated Workplace Sick and Safe requirements. New positions are being added to the 2024 budget to help address workloads and right-size the workforce to meet the community’s needs as it grows. Three percent of the proposed 2024 levy increase is allocated to increase annual funding for the CIP. An increase of $890,000 in state funding through Local Government Aid will also be used to address an extensive backlog of urgent deferred maintenance on City-owned buildings.
The Finance Director must certify the proposed levy along with a budget summary to the Steele County Auditor prior to September 30. Steele County uses this information to send preliminary tax statements to all property owners annually in November. During the next few months, City staff will continue to adjust the proposed budget as additional information becomes available. Adjustments can be made to lower the levy; however, it cannot be increased from the amount certified to the County.
In addition to approving the 2024 proposed budget on September 19, the City Council set the date for the City’s annual Truth in Taxation Hearing for December 5 at 6 p.m. which will include a summary of the 2024 budget and provide an opportunity for the public to provide input on the proposed budget. The City’s interactive budget document is available online at Owatonna.gov. For additional information, please contact a City Council Member or Finance Director Rhonda Moen at rhonda.moen@owatonna.gov. The City Council is expected to take action to adopt next year’s final budget and levy December 19.