cp08-06-1998 cAGENDA
• SPECIAL MEETING - HUTCHINSON CITY COUNCIL
THURSDAY, AUGUST 6, 1998
(a) PRESENTATION AND RECOMMENDATION BY COMPASS GROUP
►I . w
(a) RESOLUTION SETTING DATE OF SPECIAL ELECTION FOR TUESDAY,
SEPTEMBER 15, 1998, AND ESTABLISHING WORDING FOR BALLOT
QUESTION.
Action — Motion to reject — Motion to approve
I • P. Elul ►Y
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ARNOLD, ANDERSON & DOVE
PROFESSIONAL LIMITED LIABILITY PARTNERSHIP
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DAVID B. ARNOLD'
STEVEN A. ANDERSON
O. BARRY ANDERSON'
LAURA K. FRETLAND
PAUL D. DOVE"
JANE VAN VALKENBURG
RICHARD O. McOEE
CATHRYN D. REHER
WALTER P. MICHELS. 111
JAMES UTLEY
IAL10 ADMITTED IN TEXAS AND NEW TOIIK
Mr. Ken Merrill
Hutchinson City Center
111 Hassan Street SE
Hutchinson, MN 55350
Re: Sales Tax Issues
Our File No. 3188 -98367
Dear Ken:
RESIDENT ATTORNEY
G. BARRY ANDERSON
August 6, 1998
OF COUNSEL
ARTHUR L. DOTEN
5891 CEDAR LAKE ROAD
MINNEAPOLIS. MINNESOTA 66416
(612) 546 -9000
FAX (012) 545 -1793
501 SOUTH FOURTH STREET
PRINCETON. MINNESOTA 55371
(0 1 21 369 -22 1 4
FAX 161 2) 359-5500
• I am enclosing herewith the form of the proposed ballot question for discussion at this afternoon's
meeting at 3:00. I do want to bring to your attention the provisions of Minn. Stat. §275.60 and
§275.61, a copy of which are enclosed with this correspondence. Under the provisions of Minn. Stat.
§275.61, it is my conclusion that we need to include the language at the bottom of the ballot dealing
with what happens if the property taxes are used to pay for these improvements even though that is
unlikely to occur. I do think that we can include the qualifying language "rather than from sales tax
revenues as planned" to indicate the fact that this is unlikely to occur.
You will note that NImn. Stat. §275.60 requires some mandatory bold face language when general
obligation bonds are involved. The language required reads "by voting yes on this ballot question you
are voting for a property tax increase." It is my opinion that such language is misleading, inaccurate
and simply wrong and violates the legislative requirement that ballot questions must be clear and
concise because in fact a yes vote does not mandate a property tax increase. I note with interest that
the City of Rochester reached a similar conclusion and did require the inclusion of the language
presently shown on the proposed ballot question before you now and did not require the language
dealing with property tax increases. This matter is not without doubt and, I suppose, a challenge is
always possible.
The numbers with respect to the disclosure language at the bottom of the ballot will need to be filled
in by Ehlers and they should probably be sent a facsimile transmission immediately to request that
information as soon as possible.
• I look forward to seeing you at 3:00 pm this afternoon.
ATTORNEYS AT LAW
101 PARK PLACE
HUTCHINSON, MINNESOTA 85350 -2563
(320) 587-7 57 5
FAX (3aO) 5674096
'CERTIFIED AS A CIVIL TRIAL SPECIALIST BY THE MINNESOTA STATE BAR ASSOCIATION
"CERTIFIED AS A REAL PROPERTY LAW SPECIALIST BY THE MINNESOTA STATE BAR ASSOCIATION
• Mr. Ken Merrill
August 6, 1998
page 2
Best regards.
Very truly yours,
ARNOLD, ANDERSON & DOVE, PUP
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Barry�Ann rson
GBArm
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CC Jerry Gilligan
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•
PROPOSED BALLOT QUESTION
Shall the City of Hutchinson make the following needed improvements:
A. Constructing and improving a multi -use civic and community center;
B. Constructing and improving a senior citizens facility;
C. Constructing a sheet of ice for youth recreational purposes;
And finance the cost thereof by imposing a sales and use tax of one -half of one percent and an excise
tax of $20.00 per retail sale of motor vehicles on all taxable transactions within the City of
Hutchinson and issue general obligation bonds in an aggregate amount not to exceed $5 million plus
the cost of issuing the bonds to pay for these improvements? Sales tax revenues are pledged to pay
the bonds but the bonds are general obligations and will be guaranteed by the City's property taxes.
❑ Yes
• ❑ No
If the bonds were paid entirely from property tax levies rather than from sales tax revenues as
planned, the amount of such increase levy as a percent of market value would be % and the
total amount of such taxes in the first year of any such levy would be
•
275.60 TAXES; LEVY, EXTENSION 22
Subd. 4, MS 1988 [Repealed. 1989 c 277 art 2 s 77: 1 Sp19S9 c 1 art 5 s 511
Subd. 5. MS 1990 [Repealed. ISp1989 c 1 art 5 s 511
Subd. 6. MS 1990 [Repealed. ISp1989 c 1 art 5 s 511
275.59 [Repealed. ISp1981 c 1 art 5 s 131
275.60 LEVY OR BOND REFERENDUM: BALLOT NOTICE.
Notwithstanding any general or special law or any chatter provisions. but subject to see.
Lion I24A.03. subdivision 2. any question submitted to the voters by any local governmental x
subdivision at a general or special election after June 8. 1995. authorizing a property tax lev
or tax ate increase, including the issuance of debt obligations payable in %k hole or in part .
from property taxes, must include on the ballot the folloxving notice in boldface I%pe.
BY VOTING "YES" ON THIS BALLOT QUESTION. YOU ARE VOTING
FOR A PROPERTY TAX INCREASE."
For purposes of this section and section 275.61. "local govemmental subdivision" in-
cludes counties. home rule and statutory cities. «owns. school districts, and all special taxing - ;
districts. This statement is in addition to any general or special law's or any charter provisiexa 1
:hat 20N ern the contents of a ballot question.
This section does not apply to a school district bond election if the debt ser pay
the d
merits are to be made emireh from transfers of revenue from the capital fund to the debbt set-
Nice fund.
History: 1991 c 291 arr 1 s 23; ISp1995 c 3 i t I s 53
275.61 VOTER APPROVED LEVY; MARKET VALUE.
• For local govemmental subdivisions other than school districts, any levy, including tk:
issuance of debt obligations payable in whole or in part from property taxes, required tobei
approved and approved by the voters at a googol or special election for taxes payable in 1993;
and thereafter, shall be levied against the referendum market value of all taxable prup A y
governmental the govemental subdivision, as defined in section 124A.02, subdisision 3b. n7
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levy amount subject to the requirements of this section shall be certified separately to the
count' auditor under section 275.07.
The ballot shall state the maximum amount of the increased levy as a percentage of rrx-i
ket value and the amount that will be raised by the new referendum tax rate in the first year
is to be levied.
History: 1991 c 291 an I s 29: 1992 c 511 art 2 s 22: 1996 c 471 arr 3 s 21
NOTE- This.a,,.. v added b lays 1991. chapier _'91. article I. se von '_9. i> enalive for mf A p blicly -d r
far lixea pxy
1993 and efter. except that am cm ar caunly that cotdocted a referendum ix pr to I.tay I. 1992. and had pu
thrw
its property ou ners using levy amoums thaL if adopted rellea nct tax lap-0- ie exempt fmm this pro on ,i,h mrtuds W r
referendum. If the city ar count, intrnds m lot' the = on net tax capucm under this salmon. it mull octtifY to the mmrm �
re venue the infrnn a ion oecessm)' for de comndssiona to determine y
ine that the uirements of this exception here been tnd.
991. chatter 291 . article 1. section bs, as amended b) taws 1992. chupler s I I. article'_. s ctiw 59.
275.62 TAX LEVIES; REPORT TO THE COINLNIISSIONER OF REVENUE. 3
Subdivision 1. Report on taxes levied. The commissioner of revenue shall establA
procedures for the annual reporting of local government levies. Each local govemmental
shall submit a report to the commissioner by December 30 of the year in which the tax Is k�
ied. The report shall include. but is not limited to, information on the amount of the tax lat'ipl
by the governmental unit for the following purposes
(1) debt, which includes taxes levied for the purposes defined in Minnesota Sta
1991 Supplement, section 215.50, subdivision 5, clauses (b), (c), (d), and (e);
(2) social services and related programs, which include taxes levied for the p
defined in Minnesota Statutes 1991 Supplement section 275.50. subdivision 5. clauses
U). and (v);
(3) libraries. which include taxes levied for the purposes defined in Minnesota S.,�
1991 Supplement, section 275.50. subdivision 5, clause (n); and
(4) other levies, which include the taxes levied for all purposes not included in clam
(1). (2) or (3).
, 229
Subd. 2. Local gos'ernmeuts ret
r governmental unit' means a county.
greater y t
c ity 2 .50 0 , 0 un that es p a t
to
statury
the levy year.
Po ulation es timate. F
Subd. P at
m. g 275 1 u
or by an
1� made under section 4A.02. whic
r. mate for the calendar year precer
Subd. 4. Penalty for late report
ce: aid pay aired in subdivision I by January
' ments to the local governnle
led
k vned (l) for a county. the aid o amount
2) for other local 90v eminent
..011 to 477A.014 shall be red
History: 1992 c 511 arf 5 s 11
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Council Member
introduced the following resolution
and moved its adoption:
RESOLUTION NO.
RESOLUTION PROVIDING FOR AN ELECTION ON THE DESIRABILITY OF
CONSTRUCTING CERTAIN MUNICIPAL IMPROVEMENTS AND IMPOSING A ONE
HALF OF ONE PERCENT (1/2 %) SALES AND USE TAX AND AN EXCISE TAX OF
TWENTY AND NO /100 DOLLARS ($20.00) PER RETAIL SALE OF MOTOR VEHICLE
FOR THE PURPOSE OF FINANCING SAID CONSTRUCTION
BE IT RESOLVED, by the City Council of the City of Hutchinson, Minnesota, as follows:
1. A special election is hereby called and shall be held on September 15, 1998, between the
hours of 7:00 o'clock a.m. and 8:00 o'clock p.m. at which election the question of issuing bonds and
imposing a sales and use tax and an excise tax shall be submitted to the voters.
2. Notice of the submission of said question at said election shall be given by publication of
the notice of election in the official newspaper once a week for at least two weeks prior to the
election, with the first publication to be not less than fourteen (14) days before the date of election.
• The City Administrator shall also post a copy of said notice in his office at least fourteen (14) days
prior to the election date. Said notice shall be in substantially the following form:
Cl
NOTICE OF SPECIAL ELECTION
SEPTEMBER 15, 1998
CITY OF HUTCHINSON, MINNESOTA
NOTICE IS HEREBY GIVEN that a special election will be held in and for the City of
Hutchinson, Minnesota, on Tuesday the 15' day of September, 1998, between the hours of 7:00
o'clock a.m. and 8:00 o'clock p.m., at which the following question will be submitted:
Shall the City of Hutchinson make the following needed improvements:
A. Constructing and improving a multi -use civic and community center;
B. Constructing and improving a senior citizens facility,
C. Constructing a sheet of ice for youth recreational purposes;
And finance the cost thereof by imposing a sales and use tax of one -half of one percent and an excise
tax of $20.00 per retail sale of motor vehicles on all taxable transactions within the City of
Hutchinson and issue general obligation bonds in an aggregate amount not to exceed $5 million plus
the cost of issuing the bonds to pay for these improvements? Sales tax revenues are pledged to pay
the bonds but the bonds are general obligations and will be guaranteed by the City's property taxes.
Yes
No
If the bonds were paid entirely from property tax levies rather than from sales tax revenues as
planned, the amount of such increase levy as a percent of market value would be % and the
total amount of such taxes in the first year of any such levy would be
The polling places for said election shall be as follows:
Precinct No.
No. 1 -3
Polli❑ Pg lace
Recreation Building
All registered and qualified voters of the City are entitled to vote at said election within the
respective precincts in which they reside. DATED this 6' day of August, 1998.
BY ORDER OF THE CITY COUNCIL
Ken Merrill
Finance Director
3. Pursuant to Minnesota Statutes, Section 205.16, subdivision 3, the City Administrator shall
also post a copy of the sample bond ballot in his office at least four (4) days before said election and
at each polling place on the date of election. The sample bond ballot shall be in substantially the
following form:
OFFICIAL BALLOT
BOND ELECTION
CITY OF HUTCHINSON, MINNESOTA
SEPTEMBER 15, 1998
Shall the City of Hutchinson make the following needed improvements:
D. Constructing and improving a multi -use civic and community center;
E. Constructing and improving a senior citizens facility;
F. Constructing a sheet of ice for youth recreational purposes;
And finance the cost thereof by imposing a sales and use tax of one -half of one percent and an excise
tax of $20.00 per retail sale of motor vehicles on all taxable transactions within the City of
Is Hutchinson and issue general obligation bonds in an aggregate amount not to exceed $5 million plus
the cost of issuing the bonds to pay for these improvements? Sales tax revenues are pledged to pay
the bonds but the bonds are general obligations and will be guaranteed by the City's property taxes.
Yes
No
If the bonds were paid entirely from property tax levies rather than from sales tax revenues as
planned, the amount of such increase levy as a percent of market value would be % and the
total amount of such taxes in the first year of any such levy would be
INSTRUCTION TO VOTERS: If you approve of the above question, mark a cross (X) in the "YES"
square opposite said question. If you disapprove, mark the cross (X) in the "NO" square opposite
said question.
4. The City Administrator is authorized and directed to cause to be printed ballot strips, if
appropriate, and official bond ballots for the use of the voters at said election.
5. The furnishing by the City Administrator to the McLeod County Auditor of the notice set
forth in paragraph 3 hereof at least 30 days prior to the election, as required by Minnesota Statutes,
Section 205.16, Subdivision 4, is hereby ratified and affirmed.
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6. The polling places for each precinct for the election shall be as set forth in the notice of
election and the election officials for each polling place shall be designated by a separate resolution
of this Council.
7. The City Council shall declare the results of the vote upon said issue when it meets as a
canvassing board following said election.
Mayor
Attest:
City Administrator
The motion for the adoption of the foregoing resolution was duly seconded by Council
Member and upon vote being taken thereon, the following voted in favor
thereof:
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted.
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