You wouldn’t buy a car from merely reading the manufacturer’s ads would you? If you live in Minnetrista in either the Mound Westonka or Watertown school district there is a very important vote on Tuesday: $Millions of dollars in school referendums that will impact you and your community for the next decade and beyond. I urge everyone to get information from sources other than the school districts promoting the referendums. These referendums are intentionally held in non-election years counting on low voter turnouts. Here is where you can vote on Tuesday, November 5:
Watch a representative from Ehlers, the city’s contracted financial advising firm, who gets paid to help cities borrow money, defend Minnetrista’s weak debt profile from Standard & Poors in this video from Monday night’s council meeting, rationalizing that because everyone else does it, it really isn’t a big deal. Well, of course a firm specializing in debt issuance would see it that way.
Minnetrista’s debt service is 18.6% of total government fund expenditures and that is high, according to Standard & Poors which isn’t a firm specializing in debt issuance. They specialize in evaluating the credit worthiness of organizations. Perhaps we should heed the assessment from S&P rather than go along with the don’t worry be happy advice from our debt issuance firm.
Because a city can just take the money out of constituents’ pockets it carries an obligation to make sure it manages debt responsibly. Even the Ehlers rep estimated Minnetrista would need to almost cut its debt service in half (reduce it to 10%) to change the S&P rating. Minnetrista needs to put the brakes on. Apparently so do a lot of other Minnesota cities.
Monday night’s discussion centered around refinancing some G.O. bonds and the city’s ratings relative to receiving favorable bids. Having a AA++ rating is a good thing and the city’s finances are strong partly because our residents are relatively affluent which translates into what they call a “high tax capacity” (there is plenty more to take) and there are funds stashed away in “special” funds that aren’t being used. But bond ratings are not the point here. Saddling future generations with debt that keeps growing is the point.
The eight page Standard & Poors rating wasn’t in our council packet or available to the public prior to the meeting. I had to request a copy of the rating assessment to review prior to the meeting and asked that it be provided to the council. They had planned to hand it out during the council meeting. If residents would like a copy they can call city hall.
“There are three types of lies – lies, damn lies, and statistics.” – Benjamin Disrael
Local governments want more of your money but they want you to hand it over without a fight so they pull out statistics to convince taxpayers to open their wallets. Here are just a few things to look for to see if you’re being manipulated by the numbers.
Omissions: Leaving out something significant that, if known, would lead the reader to a different conclusion from the data presented:
- When a city, in an attempt to waylay fears of a tax increase, says their tax rate has stayed the same or is lower than it was before but neglects to reveal that your property valuation has increased substantially and, therefore, the amount you pay is going up.
- When the city tells you residents are willing to accept a property tax increase for road maintenance without telling you that 64% of Minnetrista residents indicated they opposed any property tax increase for roads in the community survey (see below).
Using percentages from a small sample size: When a survey uses an insignificant sample size, percentages will always be misleading:
Minnetrista’s community survey asks respondents if they would favor or oppose an increase in property taxes for city street repair/maintenance and 64% said they’d oppose an increase. A very small number (128 people out of 7,000 city residents) indicated they’d favor an increase. That subset of respondents (128 people) was questioned to see how much more they’d be willing to pay. When they indicated various amounts ($5-$30/mo) it was then repeated over and over again that, according to the community survey, the majority of people (which was actually just 118 people: 92% of the 128) are willing to accept an increase in their city property taxes for roads, when, in fact, 64% surveyed said they were opposed. Starting to get the picture of how this works?
Faulty polling: How questions are phrased can influence responses dramatically. A deceptive polling strategy is to precede a question with a narrative designed to prejudice the response or to omit (see above) important data qualifiers. The examples below use a combination of both omission and faulty polling strategies:
- Minnetrista’s community survey precedes a question (#49) about whether or not the city should build a gun range saying “there is an unfinished gun range” and “if finished” it would be used by residents. Communicating something as “unfinished” implies that it has been started (which it has not) but not completed and influences a positive response since people generally are averse to leaving things “unfinished”. The truth of the matter is there is empty space with nothing in it that could be built out as a gun range. This survey question also omitted the fact there would be significant, ongoing annual operational and maintenance costs that will increase residents’ taxes over and above the build out costs. Had that been revealed and the phrasing less biased, the responses would likely have been much different. Even so there was little support to use tax dollars to fund the build out, and one would assume no support for tax dollars to fund the maintenance (if they had been aware of it).
- This one is my favorite: This survey question precedes another (74) regarding the approval rating of the Mayor and Council with a question that reveals the majority of respondents know “very little” to “nothing at all” about the work of the Mayor and Council but then goes on to ask if they approve or disapprove of the job the Mayor and Council are doing. Remember that next time you hear about the council’s 80% approval rating. Apparently ignorance is bliss.
Community surveys are merely vehicles designed to justify tax increases and reelect incumbents that support them.
That’s how much more someone with a $500K market valuation will pay annually if the revenue referendums proposed by Watertown School District pass in November:
Westonka Schools also have a revenue referendum increasing school spending coming up for a vote November 5 as well. A $500K property would see an annual increase of approximately $121 in that district if it passes.
Both referendums provide for annual inflationary increases for the next ten years.
Watertown School District Voting:
Westonka School District Voting:
More information on both school districts’ referendums:
Watertown School District’s referendums
Westonka School District referendum
Monday was a long night for the city council with a full and challenging agenda. Unfortunately for Minnetrista taxpayers the council chose to adopt (4 to 1) the highest increase (5.87%) presented by staff for the 2020 preliminary tax levy, despite having hundreds of thousands of dollars that have been sitting in unused special funds for years with no foreseeable liabilities against them. We continue to raise taxes and debt while cannibalizing our fund reserves, all the while having access to these public funds which, in my opinion, belong in our general fund reserves to give an accurate view of the city’s balance sheet. If the city needs to buy trees we can budget for them. If the city needs to purchase additional emergency sirens we can budget for them. Setting up “special funds” keeps this money out of the public’s view and, more importantly, out of the general fund and gives a distorted view of the city’s finances, which is used to justify tax increases year after year.
The preliminary levy increase may be lowered before the final levy adoption in December but it cannot increase any higher. December 2, 2019 was the date set last night for public comment on the 2020 final levy adoption. You’ll hear some council members defend their votes citing that the preliminary increase was reduced last year before the final levy was adopted. What you won’t be told is that it was done without cutting a single penny of spending and irresponsibly dipping into our general fund reserves.
The city’s 2040 Comprehensive Plan was on the agenda for final approval Monday night. I had some serious concerns about it noted here having to do with private wells, GreenStep Cities, inaccurate numbers projecting future water demand, and making commitments to revise or adopt future ordinances without the council having access to the wording of these ordinances. Council agreed to bring the plan back to a work session in October for discussion.
We all know Minnesota is a high taxed state. You’ll hear from city officials trying to pass their preliminary tax levy increases that your taxes paid to the city are just a small fraction of what goes to the county and school district. To that I say “So what?” They are ALL going up, ALL the time, EVERY year and those increases never go away. The compounded effect is driving people out of Minnesota to lower taxed states.
Remember this when the city of Minnetrista passes a 5.87% preliminary tax levy increase at the next council meeting on September 3.
The slogan “Keep it Rural” resonates with the people I’ve been talking with, even those living in the more densely populated Minnetrista housing developments. I was in Hunters Crest yesterday and many of those homes border beautiful marshes and prairies that residents cherish and want preserved.
City Council members have the authority to approve Planned Unit Developments (PUDs) in areas outside the MUSA line that are zoned “Rural” as well as “Urban Reserve” that could drastically change the entire landscape of Minnetrista. Make sure you vote for someone who will not support higher density PUDs than current primary zoning allows in these areas. In the 2040 Comp Plan there is something called “Limited Secondary Zoning” that essentially allows higher density in these zones if the council deems it appropriate. It’s important who you vote for.