ELY – City council members approved the 2016 budget this week, which again calls for a zero-percent levy increase over last year. A Truth in Taxation hearing was held Tuesday night.

The total city tax levy will be $1,620,800.

Taxable market value in the city grew by almost $7 million over last year, said Clerk-Treasurer Harold Langowski. “We did see a sizable market value increase, probably larger than I’ve seen in the last few years,” he said.

The Fiscal Disparities contribution to the city of Ely decreased by $1,460 from last year for a minimal impact.

With the proposed zero-percent levy increase, along with an increase in net tax capacity and the Fiscal Disparities contribution, the citywide tax rate decreases by 4.7 percent.

“What we’ve seen over the last year, is that we have had a substantial amount of property sales,” Langowski said. “Residential (properties) sold for higher than market or assessed value and commercial (properties) sold for less than assessed value.”

General Fund spending decreases by more than seven percent next year, from $433,500 to $402,300. The General Fund includes, police, fire, street maintenance, building safety, administration, parks and recreation, legal and building operation costs.

The Library Fund shows a slight increase, from $248,700 t $252,400. Economic Development also decreases from $58,700 to $55,100. The Cemetery Fund jumps 59.5 percent, from $8,400 to $13,400. “In some summers, we do get a lot of rain and the grass grows, and that increase is in the labor to mow the grass,” Langowski said.

The levy impact for the airport remains unchanged at $13,000.

Debt service increases more than 76 percent, from $204,000 to $359,600. “This can be attributed to the additional debt for the City Hall and Library projects,” he said. “The retirement of those two bonded debts in 2017 will see those debts come off (the budget) so we will see a net change of much less than the $155,600 increase,” he said.

The Capital Projects budget line shows a 26 percent decrease, from $504,500 to $375,000.

The Ely Economic Development Authority passed a special levy last summer which will collect $31,000.

Overall, total property taxes will decrease by $31,200 due to an increase in Local Government Aid revenues of $12,700 and the overall decrease in General Fund expenditures, Langowski said. “LGA wasn’t a very large increase, but it is a lot better than the decreases we’ve seen in the past,” he said.

Taconite aid revenue shows a projected increase of $10,000 from last year, from $285,000 to $295,000, despite a downturn in mining operations up and down the Iron Range. “The taconite aid payment is usually calculated in August and it does fluctuate from year to year,” Langowski said. “As far as calculating a reduction for next year, I don’t think (the mining downturn) will affect us that quickly. In 2017, and later, we could see an impact.”

“Compared to the state, we’re looking pretty good,” said Mayor Chuck Novak. He offered to amend the budget by moving the city’s cost to help fund the event coordinator position, which was an unfunded expenditure last year, to the EEDA’s budget. “That will equate to about a one-percent reduction in the levy, and that will take a bit of the burden off taxpayers,” he said.

Council members agreed, and unanimously approved an amended tax levy to show the reduction.