EDITORIAL: Taxes Cities face tight budget challenges

Sep. 21—Happy Days are gone again when it comes to municipal budgets in the Mankato area.

Plans to defer and delay spending and investing in things like infrastructure have come back to bite city councils and county commissioners. Inflation in construction and building costs have soared. And consumers face higher prices too.

So as municipalities need more, taxpayers want to pay less.

The city of Mankato's preliminary budget had a proposed increase of about 14% at one point. The preliminary levy was taken down recently to nearly 9.75% after the City Council had a sticker shock experience.

North Mankato councilors set a maximum levy Monday at a 10.4% increase. Also discussed were increases of 7.7% and 13.2%. The 10.4% increase would allow the city to hire two new police officers as requested by the police chief. A 7.7% option will pay for only one new officer.

Mankato faces myriad difficult choices as well. A 9.75% increase would cause taxes on a $150,000 house to increase 34%, or about $137.

Both councils vowed to look closely at the budgets and consider lower levies if possible. Preliminary levies can be decreased but not increased when the final vote comes in December.

The councils should consider in their budget deliberations sound principles of municipal finance.

They should decide what budget items are needed and what items are just "wants," things that would be nice to have but aren't critical.

Some budget cuts or restraints can end up costing more in the future if the spending is truly needed. We've seen that with maintenance that was delayed on the Mayo Clinic System Event Center. It now needs costly repairs, and the expense has crowded out other possibly necessary spending.

Inflation should be considered when budgeting. We were able to ignore inflation for years as it hovered around 1 to 2% annually. Obviously, the 8% inflation of the last year has crimped municipal budgets, sometimes dangerously so.

Municipalities should borrow money when interest rates are low. Again, with rising rates, many have missed that train, which left the station last year or the year before.

Less spending is not always the wisest financial move if the cost of not spending will rise exponentially down the road.

So in these tight budget times, governments should backburner the wants — no matter how many special interest groups want them — prioritize the critical needs that if not addressed will cause costs to soar in the future, and try to keep taxes reasonable and payable.

We urge citizens to participate in helping their governments set the final levies in the coming weeks.