ADVERTISEMENT

ADVERTISEMENT

Mitchell City Council dives into 'trimmed' 2023 budget, as nonprofit subsidy requests looking at reductions

According to City Administrator Stephanie Ellwein, several of the nonprofits that asked for subsidies saw significant growth in their cash fund balances in recent years.

Mitchell City Hall 5.jpg
The front entrance of City Hall, located at 612 N. Main St.
Republic file photo
We are part of The Trust Project.

MITCHELL — The Mitchell City Council received its first look at the 2023 budget on Monday, which City Administrator Stephanie Ellwein said included “needs, not wants.”

As prices continue to rise for seemingly every sector of the economy, it’s led to drastic increases in city project costs. With that in mind, councilman Jeff Smith said every city department is “going to be feeling a little pain” and operating within a “very tight” budget for 2023.

“The council should feel assured your department heads came in asking for the bare minimums they need. There is very little wants in this budget. It’s mostly how to maintain what we have and what we’re here to as core government services,” Ellwein said.

Each year, local and area nonprofit organizations submit subsidy requests to the city in hopes of receiving funds the upcoming year. A total of $682,250 in subsidy requests were submitted to the city this year, marking an increase of $121,960 from last year’s amount.

Just as city departments shaved their budgets and saw some projects get shelved, the committee is planning to trim about $136,000 of the combined subsidy amount requested.

ADVERTISEMENT

Ellwein provided further information about why the committee decided to reduce some nonprofit organization’s subsidy requests and not others. According to Ellwein, several of the nonprofits that asked for subsidies saw significant growth in their cash fund balances in recent years.

Among some of the nonprofits that are proposed to be reduced are Dakota Counseling, Mitchell Area Development Corporation, CASA, the Prehistoric Indian Village and the Convention and Visitors Bureau (CVB) that’s led by the Mitchell Chamber of Commerce.

For Dakota Counseling, the committee pointed to the Mitchell-based counseling group’s cash balance that grew by almost $2 million from 2019 to 2020 as a reason they are proposing to trim the $26,250 down to $13,000. CASA’s fund balance also grew $171,000 in 2021, according to Ellwein, which also led the committee to recommend denying the organization’s $4,000 subsidy request.

“The CVB’s application was $250,000, and the committee recommended dropping that down to $200,000 to help offset the costs of that new city administrative coordinator position,” Ellwein said of the reasons behind the committee’s recommendation to trim the MADC and CVB’s subsidy requests.

The council will provide the nonprofits to speak at its meeting on Sept. 26. Monday’s meeting was a budgeting work session only, which is why the council did not hear from nonprofits.

After eliminating some proposed city projects that officials were seeking to begin in 2023, Ellwein used it as an example to show how local and area nonprofit organization subsidy requests impact the city’s annual budget.

“Should the taxpayers money go into somebody else’s cash reserves or go into a project we had to cut. It’s not a fun statement, but it’s a reality,” Ellwein said. “Each year, we’re cutting $1.5 to $2 million in capital projects out of the budget. You can’t keep pushing those items down the road. At some point, you have to do those projects.”

Considering the rising costs of materials that are used for vital city projects such as infrastructure improvements for roads and sewer, to name a few, Ellwein recommended the council keep a good cushion of contingency funds in the coffers. Contingency funds are set aside each year for unforeseen projects and emergency repairs.

ADVERTISEMENT

“If you look at the way our project bids have come in this year, I think it’s necessary to have access to a good amount of contingencies,” Ellwein said.

Sam Fosness joined the Mitchell Republic in May 2018. He was raised in Mitchell, S.D., and graduated from Mitchell High School. He continued his education at the University of South Dakota in Vermillion, where he graduated in 2020 with a bachelor’s degree in journalism and a minor in English. During his time in college, Fosness worked as a news and sports reporter for The Volante newspaper.
What To Read Next
Members Only
Although Mitchell's rates would be increase, the proposed equitable rate structure could lessen the increased costs for residential customers' water and sewer bills.
Members Only
Recent court orders in the lawsuit continue to point the case toward a 2023 court date between the two parties.
Members Only
Now with 20 sports at MHS, Mitchell's facilities have never been busier but the question remains on how to best to get it done.
“We see that when things happen in the coastal areas, a few years later, they start trending toward the Midwest,” said Rep. Ben Krohmer, serving his first term in the House.