FFM Bulletin 8/18/08

Washington County raising property taxes again

Washington County residents will be paying a lot more for the privilege of living in their own homes if county commissioners vote for a 2009 proposed budget. The proposed budget calls for a significant spending hike, partially supported by a 4.9 percent increase in the property tax levy. According to one county official, the 2009 budget reflects a "half-million dollar increase in fuel costs, Legislature-imposed levy limits, state aid to counties that isn't keeping pace with inflation, and ongoing pressure from unfunded state mandates."

And perhaps the county should accept some responsibility for its own financial situation. Since 2004, Washington County's levy has increased from $63.0 million to over $85 million in proposed taxes in 2009, a 35-percent hike. And the county's total spending jumped from $150 million in 2006 to projected spending of more than $190 million this year. The county's population growth, by comparison, has been much slower. At just over 230,000 residents, the county has grown by less than 10 percent over the last five years.

It appears that all of those state mandates have failed to rein in the appetite for even bigger government in Washington County.

Duluth zoo suffers $600,000 loss... in a single year

It's been a tough summer for the City of Duluth. In April, the city announced a projected $4.4 million operating deficit for 2008, a figure that has subsequently been revised upward to approximately $6.5 million. Meanwhile, the Office of the State Auditor released a report in July on the city's overtime staffing, finding that the Duluth paid $3.4 million in overtime in 2007, a 62-percent increase over seven years. Finally, on August 11, Duluth's mayor announced 217 city layoffs, including up to 47 full-time employees.

Now, in an effort to cut their losses on a high profile albatross, the city is looking to unload the Lake Superior Zoo, at least on the operations side. The zoo's popularity has waned in recent years, dropping from an attendance of 128,000 in 2001 to about 100,000 visitors in 2007. And in 2006, it lost its national accreditation from the Association of Zoos and Aquariums after failing to meet maintenance and repair standards. Financially, the zoo has been a complete disaster for the city, posting a $617,368 operating loss last year alone.

So finally, the city has decided to quit while it's behind, way behind.

While stopping short of abandoning the zoo altogether, the city is planning to enter a public-private partnership to limit their financial risk. If the current plans go through, Duluth will retain ownership of the zoo but turn over operations to a private, nonprofit zoological society by the end of this year. Regardless of who operates the zoo, financial problems are likely to persist. Duluth has already sought millions in state bonding money for maintenance and repairs and has signaled that future requests are likely.

Duluth's mayor has admitted that "the city can no longer afford to run a zoo." But credit Duluth's Chief Administrative Officer Lisa Potswald with the biggest understatement, acknowledging "it's not a mission-critical function for a city to run a zoo."

Minnesota By The Numbers books available

Freedom Foundation of Minnesota has a limited number of copies available of the 2008 edition of Minnesota By The Numbers. Minnesota By The Numbers is a quick guide to how Minnesota stacks up against the other 49 states on a variety of metrics relating to taxes, economic performance, public education, and health care.

If you are interested in a free copy of Minnesota By The Numbers, please e-mail Jonathan Blake.

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