Besieged with high property taxes and increasing city costs from its annual motorcycle rally, the town of Sturgis, SD hired its first city manager yesterday.

The move is seen as attempt to leverage the revenues earned from the Sturgis Motorcycle Rally to pay for increasing costs created by the rally.

In recent years, the motorcycle rally has swelled with participants into the millions to become the largest rally in the world, not only generating more revenue for local businesses, but also creating more expense in the form of trash hauling, additional law enforcement, and liability insurance.

In addition, it also created more bureaucracy within the city. Five years ago, the city created a special agency called the "rally department". And as the rally grew larger, members of the city council and the mayor had voted themselves pay raises claiming the work they had to do had become so great that it was practically a full time job.

For a long time, residents of Sturgis, SD had been living with the promise that as the rally grew larger, it would generate more city revenues, thus eliminating property taxes.

However, the property taxes never got eliminated. They got bigger.

Bill Cissel, editor of the Meade County Times, said in a commentary that half of the property taxes goes to just paying for the salaries of city department heads...

As I pointed out in an earlier column, it costs Sturgis taxpayers more than $1 million a year just for the salaries and benefits of the department heads. That, of course, doesn't count the wages of the rest of the employees.

To put it in perspective, it takes just about half of our property taxes each year to pay for the city's department heads.

An article published in another newspaper quotes a local business owner claiming his property taxes in Sturgis are about 10 times higher in other area towns...

"Our assessed valuation, we're valued at probably 10 times what we would be worth in any nearby town, and that's because of the rally," Davis said. "The city needs to benefit from the rally; the people need to benefit."

Some were of the opinion that as the rally grew more profitable, city leaders earned more money for themselves, instead of passing the savings on to the residents.

Complicating the ever-increasing property taxes is that property values have increased in Sturgis as the rally has grown in popularity.

Frustrations grew to a climax when residents voted on April 10, 2007, to switch their city's government to a "city manager" form, thus relieving the mayor and city council from having to be intimately involved in the rally management.

The idea is two-fold, it would reduce the salaries of the city department heads, and hire a city manager with a talent for squeezing more public benefit from the rally.

Yesterday, the city hired its first city manager, David Boone, currently the director of economic development in Mexico, MO, and has 19 years of experience in city government. He'll begin serving on December 1, 2007.

Meanwhile, the city's Rally Department is already looking at ways to increase attendance even further, with an emphasis on getting more younger people to attend.

Labels: Sturgis Motorcycle Rally