Council begins budget process, votes to replace sales tax cap

The Minot City Council received its first look Monday night at a proposed budget of nearly $155.5 million for 2015 that includes 44 new staff positions.

The council took no action on the newly released budget.

The council will be reviewing the budget with department heads on Aug. 28 and voted Monday to set a public hearing for Sept. 8. Budget changes are likely before final adoption, which is scheduled to occur Sept. 15.

Proposed spending is down from the 2014 budget of $188.3 million, but property taxes would go up somewhat in the 2015 budget as presented. Acting city manager Cindy Hemphill also is recommending rate increases for the cemetery, sewer and storm sewer.

Among actions taken by the council Monday was the reinstatement of a cap on city sales tax that had been recommended by council president Mark Jantzer and the council’s finance committee.

The council approved an ordinance that would cap city sales tax at $100 per sale, effective next January. The ordinance couldn’t be implemented until after 90 days and then must start at the beginning of a quarter, making January the earliest start date.

Minot had a cap per customer of $50 per vendor per day until this past July 1. The city eliminated the cap when it extended its first penny of sales tax that goes for permanent flood control, capital improvements, economic development and property tax relief. The council later eliminated the cap on its second penny tax for infrastructure, community facilities and property-tax relief.

“Not having a cap creates significant issues for businesses that sell large ticket items,” Jantzer said. “What’s important here is that the level of taxation not be so onerous it causes businesses to lose business to other communities simply because of the tax burden.”

In other business, the council declined to take the recommendation of its planning commission and voted 5-6 to deny a zone change to Behm Enterprises on property just off the U.S. Highway 2 & 52 bypass, west of Minot. The zone change to commercial was to allow the owners to renovate a farm house to a retail boutique and office. The council denied the request after hearing concerns from neighbor Mark Larson about the impact on his property of an existing truck parking lot and possible future development on Behm property.

Mike Lucy of Minot addressed parking concerns with the council on behalf of neighbors of the First Western Bank & Trust property on South Broadway.

Lucy said the square footage of a bank expansion was not accurate when the city calculated parking required by the bank under city ordinance. The city granted a variance from 113 spaces to 105 spaces, but Lucy said the required parking should be 152 spaces and that the bank has fewer than 100 spaces.

Acting city attorney Kelly Hendershot said staff are reviewing the concern that neighbors filed previously with the city.

“We want an answer and to have it corrected before they get a certificate of occupancy,” Lucy said. He also asked that neighbors be included in any discussion between the city and the bank on the parking matter.

Neighbors have an active lawsuit against the city that alleges the city violated its zoning code in approving variances requested by the bank for the expansion.