The 2011 City of Humboldt budget was approved at the regular council meeting held on June 13.
"This year has been a very complicated budget year," said Mayor Malcolm Eaton during the meeting.
The approved budget totalled $16,269,731, not including the subdivision development investments. That's an increase of $1,833,358 over the 2010 budget.
The budget was developed after a major assessment of the city finances and taxation structure, said Eaton.
Some of the major issues being addressed in the budget are upgrades in the infrastructure, improvements to recreational and cultural facilities and planning for growth in the community.
"We have $6 million of aging water mains that will need to be replaced," said city manager James Moller at the meeting.
"We need to be more pro-active... We are not able to pave residential streets without dealing with water mains."
One of the ways the city intends to fund this large budget is through an increase in taxes.
Moller proposed increasing the mill rate by a significant amount to help off set some of the city's expenses and putting surplus into reserves.
When the tax increase was presented to city council, it raised some questions.
Councillor Phil Smith asked Moller if the increase could be implemented over the next two years instead of as a large increase this year.
"We should delay a large tax increase," said Smith.
Moller explained he thinks the city should be more pro-active and look at funding projects they will be doing in the future.
"It comes from not having appropriate tax increases over the last five years," said Moller. "If we have a surplus, it needs to go into reserves."
The rest of the council members were not excited about the large tax increase but expressed that they understood it was necessary.
"We know there's a gorilla coming to eat our lunch, but we don't know how big and how much he'll eat but we need to be prepared," said Councillor Marilyn Scott.
Smith explained he was "all for having reserves, but (would) rather have a plan first," instead of increasing taxes without a plan in place for the reserves.
Eaton agreed with Smith that planning was important, but did not agree that they didn't have a plan.
"I don't totally agree we don't have a plan," said Eaton.
He explained they have plans for many different projects.
"Which to do first is the piece of the plan missing," said Eaton.
"Unless we provide resources there won't be a plan," said Eaton, explaining why he thinks raising taxes and putting the surplus into reserves is important.
In the end, the budget was approved unanimously by council.
The City of Humboldt issued a news release on June 13, explaining how the tax increase would be implemented and how it would affect property owners, but had to retract it and the numbers presented to the Journal due to a calculation error.
They expected to have new number available later this week or next week.
"Staff and council have worked hard to keep the City's spending to a minimum and although this increase is not insignificant, this is a realistic budget that reflects council's priority to deliver a budget that represents good value for residents and businesses," said Moller in the news release.
"Our desire is to always achieve a fiscally responsible budget that allows for infrastructure improvements, enhances service levels and provides transfers to reserves in order to replace our aging infrastructure."
