ARCHER—Completion of several commercial development projects in Archer increased the city’s property tax valuation by 54 percent, giving a projected $11,971 boost to the city’s fiscal year 2021-22 budget.
The projected budget increase will come without a change to the city’s maximum tax rate for levying property taxes.
Following a public hearing on Feb. 9, the Archer City Council approved a maximum tax rate of $8.10 per $1,000 of assessed property value for the fiscal year 2021-22 budget. The rate is the same as was approved for the fiscal year 2020-21 budget.
The taxable valuation of properties in Archer jumped from $2,700,598 in the 2020-21 fiscal year to $4,174,368 in the coming year, an increase of $1,473,760.
The biggest contributors to this overall increase of total property values in Archer are a new grain bin completed in 2019 by the Archer Co-op Grain Co. and two warehouses finished in 2019 for DK Plastics, an Archer-based manufacturer.
The parcel of land where the co-op’s 575,000 grain bin is located, just within city limits, was assessed at $1,395,160 in 2020, according to records from the O’Brien County Assessor’s Office. This is up from the assessed value of $23,670 in 2019.
DK Plastics’ new 100-foot-by-80-foot steel-exterior warehouse and the 50-foot-by-40-foot addition to an existing warehouse increased the assessed value of a formerly empty lot to $243,570.
Due to the timing of property value assessments and when tax levies are set, this is the first budget where the increase in assessed value has an impact on overall property tax values for the city. The 54 percent increase in property tax valuation is a big jump from the previous year, when Archer city clerk Sandy Fritz said the percentage increase was only about 4 percent.
“It’s nothing to do that we’re taxing any more, it’s just that your tax value has gone up,” Fritz said.
The tax value increase raises the overall taxes levied on regular properties from $21,404 to a projected $33,375 for fiscal year 2021-2022.
However, Archer’s proposed budget for fiscal year 2021-22 is $94,350, down from a budget of $139,006 for fiscal year 2020-21.
Part of the reason for the decrease is because the city’s budget for public safety is dropping from over $59,000 spent in the current fiscal year to project only $8,500 worth of expenses in the same category for the coming fiscal year.
The large expenditures are because the city recently purchased a new snowplow truck and invested in an upgrade of the city’s fire truck tank. With those purchases completed, the city anticipates much less need for funds.
A public hearing for the proposed budget for fiscal year 2021-22 will be held at the council’s next regular meeting at 7 p.m. Tuesday, March 9, at the Archer United Methodist Church.
At the Feb. 9 meeting, the council also discussed means for helping Carroll Township repay the city for its share of costs incurred to upgrade the city’s fire truck tank in March 2020.
Archer shared the cost of the $67,998 tank with Summit, Carroll, Baker and Dale townships. The five entities split the $17,500 down payment, with Archer paying $4,970.
The city has since paid for the tanker in full and the townships have paid back their share of the cost of the tanker to Archer with the exception of Carroll Township.
Carroll Township made a $5,300 down payment, but still owes $18,000 it does not have.
Fritz said she was told by township board members that “they did not file a budget for last year so they never collected any money.”
Fritz added that Carroll Township will be able to make the annual $1,900 payment to Archer for fire protection. She passed on a request from the township board asking to delay making its payment for the tanker until 2023.
Mayor Nathan Mueller expressed doubt about waiving payments for two years.
“If you took a loan out on your house and you said, ‘You know, bank, I don’t want to pay you even though I put the down payment down,’ they would foreclose on you,” Mueller said. “Now that’s not something we want to do, but maybe that’s something we need to suggest to them.”
Council member Bill Engeltjes suggested Carroll Township get a two-year loan from a local bank to pay back the city of Archer, or that Archer charge interest on the unpaid balance of $18,000.
Mueller agreed to reach out to the township board to discuss plans for collecting payment.