Winona votes prelim. levy increase: 13.4%

Earlier this month, the Winona City Council voted 5-2 to approve a preliminary increase of 13.4% for the 2027 property tax levy, the largest increase in years. While inflation and rising employee benefits accounted for much of the baseline increase, the council favored adding $620,000 to the levy for two new positions, library funding, and fire department vehicles. Council members agreed it is a heavy lift but most said it’s needed. Dissenting City Council members said 13.4% was beyond the pale and worried how such an increase would impact taxpayers. While the City Council won’t be able to increase the levy any more, it can still decrease it before the final budget and levy is adopted in December.

Last month, the Winona City Manager presented his recommended 2027 city budget, which included a $1.4 million, or 9.1% increase to the property tax levy. Inflation and increasing employee salaries and benefits made up a large portion of the increase. The city plans to take out a $2.5 million loan next year to pay for a new fire engine and to replace two HVAC units, their controls, and the boiler system at city hall. Annual debt payments for equipment loans will also contribute to the levy increase by adding $432,000. The levy includes numerous other additional costs, such as $70,000 for annual subscription-based IT and budgeting software, $71,250 to replace tornado sirens, $15,000 to help fund a mental health navigator position, $60,000 for a dehumidification system at Bud King Ice Arena, and $58,000 for ADA bathroom improvements at the East Recreation Center. Another $24,000 previously budgeted for the police department’s Flock cameras will also be moved to the Friendship Center’s senior advocacy program. The 2027 budget also includes $1.5 million in debt payments for improvements at the wastewater treatment plant to meet state mandates for limiting phosphorus pollution.

City Manager Chad Ubl noted that multiple new positions were considered for the budget but ultimately scrapped to lower the levy increase. Two of these positions, an IT professional and a firefighter, council members wanted to add into the budget for $94,000 and $85,000, respectively. Council members also favored adding $20,000 into the levy for library staffing as well as $420,000 for a fire department pickup truck with a trailer and a sprinter van instead of spending $1.4 million on a hazmat truck. These additions brought the levy increase to 13.4%. A 13.4% increase to the total levy does not necessarily equate to a 13.4% increase to an individual’s tax bill. Other factors, such as changing property values and the city’s overall tax base, also play a role.

At the City Council’s meeting on September 8, council member Steve Young said much of the levy increase is due to the state shifting costs down to cities. He said that local government aid, which once accounted for more than half of the city’s budget, is plateauing in the face of inflation, leaving the city to pick up the slack and raise taxes. He supported including the IT professional and additional library funds, bringing the levy increase to 9.9%, but said 13.4% is too much. Addressing the elephant in the room, Young said he feels taxpayers won’t support the increase when the city hasn’t yet sorted out how much a new police-fire station will exactly cost and how the city will pay for it. “If you have a family that's anticipating a large purchase, maybe a vehicle … you've got to figure out: Do I have enough cash for this? Do I have to borrow for it? What's the payment? That question of a large purchase needs to get solved before other expenses are budgeted in,” Young said.

City Council member Sam Zierden Shortridge agreed that the city is getting less support from state and federal sources, and reframed Young’s analogy, stating, “If groceries are getting more and more expensive, you maybe put off the new car; you maybe get less of a new car; you may look at a different option. I see this tax increase as groceries getting more expensive.” Still, Zierden Shortridge said, residents have needs that they expect the city to meet. “As a municipality, we still have needs and costs are increasing, and I know that pinch hurts. I feel it too,” she said.

City Council member George Borzyskowski said he supported the 13.4% levy increase for the added firefighter. He noted it will allow all fire department shifts to be staffed by seven personnel, which will improve firefighters' response to emergencies. For all the millions in sales tax revenue Winona generates for the state, Borzyskowski wished the city would receive more back.

City Council member Jerome Christenson added that the original 9.1% proposal was for a barebones budget that only adequately covered operating costs. He said in light of cyber attacks on the county and resulting $128,000 ransom payment, “We cannot afford not to have the best possible security in our IT department.” Christenson added that the increase to the levy is a small price to pay to ensure the well being of the Winona community.

At a 9.1% levy increase, Ubl said the owner of a median-valued home of $201,000 could pay $905 in property taxes. Ubl said the $620,000 addition to the levy, bringing the increase to 13.4%, could add $36, or $3 per month, on top of that bill.

Like Young, City Council member Jeff Hyma said he supported adding library funding and an IT professional to the levy but felt pushing the levy increase higher to 13.4% while the city faces a huge unknown cost for police and fire facilities is not prudent. Not that an extra firefighter and fire vehicles aren’t good ideas, Hyma said, but they are beyond the pale. “For, unfortunately, a small but significant portion of Winona, this is painful. And when you add that to what the county is going to add and what the school district is going to add … it's going to be significant for some, and it is going to be a strain for some. So we can talk up here because it isn't going to affect us that much personally, but there are people that it will.”

Mayor Scott Sherman said he never forgets the impact of council decisions and noted he has a neighbor living on a fixed income. While 13.4% is scary and gives him pause, Sherman said, “Our residents expect a certain level of service, and it is our responsibility to give it to them, even if we take the flack for going over into a double-digit [levy increase].” He added that he supports the additional positions and library funding, as well as the fire vehicles, stating, “In my life I have recognized the unfortunate pattern of sometimes you need to spend money to save money.” Sherman added that the extra funding in the levy for the fire vehicles will create an ongoing funding source to address other capital projects and deferred needs.

Christenson said city needs and expenses don’t go away by kicking them down the road, they only get more expensive. He added that he doesn't worry about what percent the levy increase is but whether needed services are being funded. “It is better to reap the benefits of moving ahead on filling these positions and purchasing this equipment, and enjoying these efficiencies, protecting our infrastructure than hoping we can do it sometime down the road when you're already worrying about taxes going up,” Christenson said.

The City Council has spent seven hours reviewing the 2027 budget and there is no fat to cut, City Council member Jason Dicus said. “I think we need to do the responsible thing and start taking care of some of the basic maintenance of the city, and if we don't we're going to be reactionary and we're going to do a disservice to the residents,” Dicus said.

The City Council voted 5-2 to adopt the preliminary 2027 budget, including the 13.4% levy increase. Zierden Shortridge, Dicus, Sherman, Christenson, and City Council member George Borzyskowski voted yes, and Young and Hyma voted no.

Winona votes prelim. levy increase: 13.4%

Comments