Lake St. Croix Beach faces budget crunch due to accounting error

Lake St Croix Beach representatives just now informed residents that the city mistakenly gave everyone a property tax break over the past three years City Clerk Administrator Dave Engstrom announced the city s former contract accountant did not account for the city s fiscal-disparity tax benefit in the city s certified tax levy starting in The wrong information was submitted by the contract accountant he mentioned The total shortfall over the three-year period was In for example the city should have submitted to the county a tax levy of instead of an almost shortfall he explained The shortfall was the shortfall was Lake St Croix Beach residents learned about the error in a post written by City Attorney Christina Benson in the city s August newsletter Residents will find if they look at their tax record that there was a substantial percentage drop compared to the previous year Benson wrote The development of the Fiscal Disparity Levy not being accounted for is that residents were undercharged for taxes dating back to The Lake St Croix Beach City Council went into closed session during a special meeting on Aug to discuss prospective litigation against the city s former financial consultant regarding insists the city has asserted for professional malpractice Mayor Tom McCarthy commented prior to the session Engstrom disclosed Thursday that he could not comment on what happened during the closed session citing achievable pending litigation The shortfall did not cause any disruption to the day-to-day running of the city McCarthy wrote in the August newsletter All projects were completed as scheduled drawing from reserves The micro-surfacing projects throughout the city streets were not impacted and will keep the roads in good condition Rest assured that the budget for will reflect the Fiscal Disparity Levy Fiscal-disparity revenue is property tax money collected on new commercial and industrial tax base upsurge in the seven-county metro area Engstrom revealed The money is placed in a pool and redistributed to communities and taxing districts The system shifts the property tax base from the wealthiest areas to those with less tax base It is a way to spread the wealth from the Bloomingtons and Woodburys of the metro area to smaller cities and cities that have minimal commercial and industrial maturation Engstrom revealed The city s budget is the city has a population of City authorities may decide to increase the city s levy for and beyond to help make up for the shortfall Engstrom mentioned the city has until Sept to submit a preliminary levy for After that city officers can adjust it lower but not higher by the end of the year he explained Residents seek study A group of Lake St Croix Beach residents has obtained the necessary number of signatures percent of the city s voters in the last presidential voting process to ask the Office of the State Auditor to investigate declared Cindie Reiter who served on Lake St Croix Beach City Council for more than years largest part in the last few days from to We are concerned about the repetitive errors that have been made Reiter noted They didn t let anyone know that there was a shortfall when it was verified in early We are worried about the lack of transparency Once that petition is received the Auditor s Office will likely meet with residents and decide whether to examine the books records accounts and affairs of the city Reiter announced Engstrom stated the city would be responsible for covering the cost of the audit which he estimated would cost around We would have to take that out of something else presumably road repairs he explained I don t think it would prove anything that the city audit didn t already show Reiter mentioned Cost of the state audit is unknown until OSA reviews our request We don t know what it will cost It s based on what they determine they will look into We think it s worth asking for the review It s up to them to decide what they will review Related 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then there could be a reasonable sit-down to figure out how to fix it and it gets taken care of and life goes on There s no need for confrontation conflict in a public of this size I would really like to see that as the outcome