Rental fees highlighted as Rochester council approves $509.4 million city budget

Randy Petersen, Post-Bulletin, Rochester, Minn.
·3 min read

Dec. 7—It wasn't property taxes that led Michelle Hill to become the only resident to ask the Rochester City Council to consider changes to the city's 2022 budget Monday night.

"We're talking about a plethora of other fees to be concerned about," the owner of Matik Management and president of Rochester Multi-Housing Association said.

The city's $509.4 million budget includes fee increases for missing inspection appointments and for re-inspection of properties that fail the first check, but Hill said the greatest concern is the planned implementation of a late-compliance fee, which could range from $100 to $500 for landlords who failed to make changes in a timely manner after an inspection.

She said frequent inspection delays could cause fees to be imposed at no fault of the landlord, which would penalize a struggling industry.

"The past two years have been an extremely difficult burden for many landlords. This industry has been affected like no other due to COVID restrictions," she said, noting restrictions related to the former eviction moratorium could linger into next year.

Taryn Edens, the city's manager of housing and neighborhood services, said imposing the fee, along with new potential charges for people who rent property without a rental certificate, is expected to be delayed until September.

She also said department changes have reduced inspection delays and any future fee would be waived if it's determined city staff caused the late compliance, related to a city inspection.

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What happened: The Rochester City Council passed a $509.4 million 2022 city budget after holding its annual budget and tax levy hearing.

Why does this matter: The annual spending plan comes with an $86.8 million property tax levy, which is a 6.5% increase to the $81.5 million levies approved for 2020 and 2021.

What's next: The approved 2022 budget will be used as the baseline for the creation of the city's 2023 budget.

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While Hill didn't address property taxes, council members raised issues with the 6.5 percent levy increase, which will add $5.3 million to the overall property taxes the city collects this year.

"I definitely have been a vocal opponent to this high increase for months now," said council member Molly Dennis, who was joined by council member Shaun Palmer in opposing the budget.

Earlier in the budget process, Dennis said it was the staff's duty to provide options for potential cuts, but Monday she said the council holds the responsibility to find cuts and asked her fellow council members to delay the decision at least a week.

"There are a lot of areas where we could have cut wasteful spending," she said, pointing to past consultant fees and property sales. She did not suggest specific cuts.

Council member Nick Campion criticized the opposition to the budget after months of discussion.

"I think it's a fairly significant abdication of responsibility to vote against the budget and not show up with a single, meaningful change that could be executed by the council," he said. "It's without precedent in my time on the council."

Council President Brooke Carlson said a tax reduction would likely require trimming park, library or public safety budgets.

"We are investing in those top services that make us a really high-valued community that people need to live safe lives," she said, citing support for the budget that passed 5-2.

Rochester City Administrator Alison Zelms said the budget continues more $3 million in spending reductions implemented and leverages Federal Rescue Plan funding available to mitigate the ongoing economic challenges related to COVID-19.

"The steps taken over the past four years to improve the budget process have increased understanding, transparency, and now provide the platform for more intentional planning through the first-ever creation of a two-year budget document," she added in a statement following the council decision.