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Housing board recommends levy increase

September 7, 2018
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Matt Flynn

Julie Gilkinson said seeing the addition of luxury apartments in Rochester upsets her.

“We need multi-residence options for families working with low-wage jobs trying to keep their heads above water,” she told Olmsted County’s Housing and Redevelopment Authority board Tuesday.

The retired public health nurse said working with a family of six to find an affordable rental home helped highlight the growing concern for her. She said larger apartments aren’t available and support is hard to find.

“It needs to be addressed now,” she said. “It’s only going to get worse and more expensive for you.”

Following comments from Gilkinson and others, the HRA board approved a potential $750,000 increase to its levy, which would provide a total of $2.5 million in 2019.

The increase would mean an extra $9.75 on the tax bill of a $250,000 home, if all other tax impacts don’t change.

Matt Flynn, who sits on the HRA board with his fellow county commissioners and community representative Angela Davey, raised concerns about the effects of a tax increase, noting affordable-housing advocates point to the burden of paying more than 30 percent of an individual income for housing.

“Do you feel the same way if you spend over 30 percent of your income for taxes?” he asked Steve Borchardt, the housing initiative director for Rochester Area Foundation.

Borchardt acknowledged it would be a burden, but suggested the board consider housing a priority when tackling the difficult budget challenge.

Trent Fluegel, who has worked for various housing agencies in Rochester, said he considers the tax increase as a way to invest in the community.

“When I pay 30 percent of my income for housing, I’m providing a good for my family,” he said. “If I pay more than 30 percent of my income on taxes, I’m providing a good to the community. It’s a selfless expenditure — it’s not just for my family — so I am willing to pay more in taxes than I am for my own home.”

While Board Chairwoman Sheila Kiscaden noted business owners and farmers typically pay higher percentages than homeowners, County Commissioner Stephanie Podulke said she supported a greater levy increase based on the estimated impact to homeowners.

“It’s the cost of two frappuccinos a year or the cost of two burritos at the food trucks,” she said of the estimated tax increase for taking the levy to the maximum amount allowed: $3.2 million.

If adopted, the $1.5 million increase could have added an estimated $20 a year to the property tax on a $250,000 home, if other factors remain unchanged.

The maximum increase failed to get the five votes needed to advance, with four board members on each side.

A counter proposal by Flynn — a $330,000 increase citing July HRA budget estimates — also fell short, failing to earn support from other board members.

In the end, middle ground was found, landing at half the maximum increase and more than twice what Flynn proposed. In a 6-2 voted, Podulke and Flynn opposed the move.

The proposed levy increase will be reviewed by the Olmsted County commissioners in two weeks, at which point they will decide whether to set it as the preliminary levy, meaning it could be reduced in the future, but not increased. The levy will be finalized in December

Commissioner Jim Bier said Tuesday’s discussion was a healthy way to balance needs and priorities in the community.

“We’re all trying to reach the same goal here,” he said.

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