Otsego residents press council on new fire department as council approves $1.43 million payment and a preliminary levy

Dozens of residents urged the City of Otsego City Council to stop or scale back its new fire department and questioned how the city will pay for operations, as the council voted to approve a large contractor payment and set a preliminary property tax levy.

During more than an hour of public comment, homeowners repeatedly blamed the council’s decision to create a city-run fire department for steep tax increases and higher insurance costs. Mark Nystrom, a resident, told the council, “when and how you're gonna pay for the second station,” and said residents are “already up in arms.” Melody Bruin, another resident, said she had “changed my homeowner's insurance to expect a total loss due to these decisions.” Gerard Zachman told the council: “This city council has not been transparent … We are told lie after lie by the former fire chief.”

The public comments preceded council votes on the fire facility and the city’s preliminary levy. The council approved pay application No. 9 for the fire and emergency services facility—$1,431,938.69—on a 3–1 vote (motion by Corey, second by Tina). Council discussion made clear the payment was for work already completed on the facility; Councilmember Ryan (identified in the meeting only as Ryan) opposed the payment and described the city’s wider fiscal problems: “Every dollar of this year's property tax increase comes from 1 decision, starting our own fire department.”

Why it matters: Residents repeatedly tied the new department to proposed increases in the city’s tax levy. City staff presented a preliminary levy figure the council formally adopted later in the meeting; staff said the preliminary levy is the maximum the city can levy this year and that the final levy adopted in December can be lower but not higher. Adam (identified in the meeting as city administrator) explained the levy process and said the preliminary levy will be used to generate truth-in-taxation notices that Wright County sends to property owners.

Most important facts: The council approved the $1,431,938.69 pay application for the fire facility (3–1). Council also approved administrative steps on the property tax levy: a resolution adjusting debt-service levies (resolution 2025-46) passed 3–1, and a separate resolution adopting the preliminary property tax levy (resolution 2025-47) was adopted by voice vote. Adam told the council the median home value used as an example in staff materials rose from $386,000 to $402,000 and that the staff illustration showed a $178 annual increase in city taxes on a $402,000 home under the preliminary levy assumptions.

What residents said: Speakers repeatedly described tax and affordability concerns. Molly Peterson told the council she had read earlier estimates that the fire facility would cost $21 million and that ongoing contracts with Albertville, Elk River and Rogers run about $1.3 million per year. Several residents urged the council to return to contract-based service from neighboring cities rather than operate a city-owned department. Gerard Zachman said the previous fire chief “took us for a ride” and told the council to “shut it down.” Others asked how the city will afford the second station and whether service-response times will actually improve.

Council discussion and staff clarifications: Council members and staff said the city faces new debt-service and operating expenses related to the fire facility. Councilmember Ryan argued the debt and staffing changes flow from the city's decision to establish its own department and that some hires and IT needs are driven by the additional workforce. Adam said the preliminary levy figure represents council direction at this stage and that the council has months of budget work ahead to reduce the levy before final adoption. Council debated using one‑time funds—such as excess gambling fund receipts—to lower the levy now; some council members opposed that approach as short-term and potentially harmful to next year’s budget.

Decisions and next steps: The council approved the construction pay application (pay app No. 9) and adopted a preliminary levy; it also set the statutorily required truth-and-taxation meeting for Tuesday, Dec. 2, at 6 p.m. in council chambers. Staff said the truth-in-taxation notice will be mailed through Wright County and that the council can reduce the levy before December but cannot increase it above the preliminary figure.

Discussion versus formal action: The public comment period was discussion only and produced no binding decision; the council separately took formal votes to approve the pay application and the preliminary levy resolutions. Several speakers proposed alternative actions—postponement of work, returning to contractual service, or using one-time funds—which the council discussed but did not formally adopt as motions.

Context and numbers: During public comment a resident cited a total spent-to-date figure: “$7,713,032.71” was quoted in the meeting as the city’s cumulative fire-related spending to date (speaker identified in the meeting as Councilmember Ryan referenced this figure when summarizing). Staff presented projected levy amounts, and Adam explained how tax capacity and the homestead market-value exclusion affect taxable value. Staff also noted the council has held multiple budget and levy meetings and will continue review before final adoption.

What’s next: The council will hear further budget and levy discussions at scheduled meetings and will finalize the levy at the statutory year-end meeting. The truth-in-taxation meeting, set for Dec. 2 at 6 p.m., will give residents an additional opportunity to comment before the council’s final levy action.