BIWABIK — On Tuesday night, the city of Biwabik will hold a public hearing to take comments regarding proposed assessments for the Biwabik City-Wide reconstruction. The special meeting is set for 6 p.m. at the Biwabik Park Pavilion.
Before the meeting, on Monday, Biwabik Mayor Jim Weikum explained the situation over email.
The following is the Q&A between Weikum and the Mesabi Daily News.
What would you like to comment in advance of the meeting?
I first joined the Biwabik City Council in January 2004 and became Mayor four years later. Hardly a meeting went by for several years where we didn't have a citizen complaining about the condition of our streets. Every winter thousands of dollars were sere spent repair water line breaks and freezes. Each year, the city council would authorize repairs on small parts of the infrastructure as that was all we could afford by combining various funding sources and trying to avoid assessing property owners. Residents still complained and said that the smaller scale projects were not enough. Finally, some leaders on the council began to envision a large scale project that would replace nearly all of the aging infrastructure in the city. We knew that there would be grants and loans for water and sewer, but that almost no external funding sources would help pay for street repairs. A plan was developed and public hearing were conducted and the project moved forward. If one reads and watches the news from around our region and the rest of Minnesota, Biwabik's challenges were not unique. Many other communities are facing the same issues with aging infrastructure and the same challenge as to how too pay for the repairs that can no longer be put off. I am proud of how our city has moved forward and how it now looks. A year from now, our Main Street will look as remarkable as the rest of the city when MnDOT completes their State Highway 135 project. A lot of citizens volunteered their time and talents to plan this project and make it a reality, and also constantly turning over every stone in the search for additional funding to reduce the burden on Biwabik's property owners. Each of them has my gratitude.
Could you explain what the meeting is about?
When a municipality plans to impose special assessments on property owners, a hearing is required to allow people to learn WHY assessments are to be imposed, direct questions to the city council and staff, and to express any concerns. The City of Biwabik has held a couple of previous hearings in the past few years where we outlined the nature of our our infrastructure project and talked about our best estimate of the likely assessment amounts (not an easy thing to do 3-5 years in advance).
The assessments land owners received were for the city-wide reconstruction project. Would these assessment be in addition to any finalized city tax levy?
The assessments are separate from the city's levy, although they would appear on a separate line the property tax statements received by property owners.
What is your goal for the public hearing?
One goal is to comply with the legal requirement for a hearing. More importantly, we want to give citizens another opportunity to receive information about Biwabik's infrastructure project and be able to ask questions.
What outcomes do you foresee from the public hearing?
The city really has only three options for paying for repairs like we've accomplished for our community. The first is to secure outside revenue in the form of grants or loans. Our task force and staff worked diligently for several years to find every dollar that we could and our low-interest loan from the USDA was a major boost for the project. We will continue to look for outside dollars until the assessments are finalized and I will have an update on that process tomorrow evening. The second option is special assessments, which is the path being discussed tomorrow evening. The third option is to add the repayment costs to our general levy. Broadly speaking, assessments are paid by property owners whose properties were directly impacted by the improvements and repairs, whereas putting the costs against the general levy impacts all of the city's taxpayers. I expect those different methodologies to be a discussion topic tomorrow evening.
Will the assessments be adjusted at any point?
I'm not an expert in the area of special assessments and the legal requirements that surround them, but it is my understanding that once the assessments are finalized, changing them gets very, very difficult and requires some very special circumstances and a very precise process.
According to a notice of hearing on assessments received from a homeowner, unpaid assessments will accrue interest, starting Jan 1, of 3.75%. Who receives this interest? Does it go to the city?
It is inevitable that some assessments will not be paid, for a variety of circumstances including tax forfeiture. The absence of payments from every property owner does not relieve the city of our repayment requirements. Any interest payments would go to the city and be added to the same special designated account for bond repayments and once received would be used for bond repayment. The city would not "profit" from such interest.