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6.0. SR 11-10-2003MEMORANDUM TO: FROM: DATE: SUBJECT: Mayor and Council Pat Klaers, City Admini November I 0, 2003 2004 Municipal Budget Item 6. The last discussions with the City Council on the 2004 budget were held on August 25, and September 8, 2003. During those meetings discussion also took place on the status of the 2003 budget. 2003 BUDGET On June 9, 2003 the City Council amended the 2003 budget. These amendments were necessary due to a $644,138 reduction in Local Government Aid (LGA). In June, budget amendments in the amount of $447,000 were made and the vast majority ($439,500) of these adjustments were made in expenditures. This left the city with a budget gap in 2003 of $197,150. Options reviewed for closing this 2003 budget gap included making additional cuts in expenditures, using city reserves, and waiting to see if revenues would substantially exceed projections. Since the June meeting it has become clear that the growth related revenues (building permits, plumbing/heating permits, and plan check fees) will far exceeded the budgeted amount. These three line items were projected in the amount of $761,850 for 2003 and by the end of September the revenues received had exceeded this amount by almost $282,000. Accordingly, it no longer looks like additional cuts need to be made in the 2003 budget nor do we have to use reserves to balance the 2003 budget. Not needing to use reserves to balance the 2003 budget will provide us with an additional resource in trying to balance the 2004 budget. It should also be noted that if growth continues in 2004 at the rate that we are seeing in 2003, then an additional building inspector may need to be hired. This additional building inspector is not in the 2004 budget but revenues from the growth activities would be sufficient to cover this unbudgeted personnel expenditure. Budget StaffReport November I0, 2003 Page 2 of 6 2004 LE.vY On September 8, 2003 the City Council approved the 2004 proposed maximum levy. The State Legislature imposed levy limits upon municipalities in 2004 but also allowed cities to recapture 60 percent of the 2004 LGA cuts. The city LGA cut in 2004 is $644,138. (Over two years, in 2003 and 2004, the state reduced the city LGA by almost $1.3 million from what the city expected to receive.) In the General Fund the tax revenue is up $539,450. This is almost the exact amount as the 60 percent of the LGA reduction plus the $150,000 street levy. Previously, the street levy was not in the General Fund but was within the limited levy. Now because of the city CIP and a recent change in the state law, our street levy for the pavement rehabilitation program can be outside the levy limit. This street levy amount is $100,000 for 2004. The shifting of this street levy frees up additional monies for General Fund activities. Sherburne County has estimated that the city will realize a 12 percent increase in its Net Tax Capacity for 2004. Based on this information and the proposed maximum levy, the city tax rate should go down about 2 percent from 44.614 in 2003 to 43.731 in 2004. The 2004 proposed General Fund revenues are $7,619,550. This is $68,350 less than the originally adopted 2003 budget. When including the LGA cut in revenues in 2003, then the 2004 revenue projection is an increase of 8 percent or $568,250. Almost all of this increase in the General Fund budget is in the tax revenue line item. 2004 EXPE..NDITUI:~E.$ The 2004 General Fund expenditures are proposed in the amount of $7,764,950. This is a $516,100 or 7.1 percent increase over the amended 2003 budget. (This is $77,050 more than the original 2003 budget.) The gap between the requested expenditures and the proposed revenues is $145,400. This budget gap is expected to increase before adjustments are made to balance the 2004 budget. The most significant decision before the City Council that would increase the budget gap is the possible hiring of a Park and Recreation Director sometime in 2004. This cost is estimated to be $44,900 for a mid-year hiring including some furniture and miscellaneous expenses. The other budget adjustments are for insurance ($8,000), animal control ($4,000), seniors part time employee ($1,200), and a reallocation of time spent by the Environmental Assistant ($22,000). P/ease note that these figures are estimates and the fina/ figures m~ va{7 slightS. These changes, puts the 2004 budget at $7,845,050 and the budget gap at $225,500. The 2004 expenditures include a three percent cost of living increase for employees, normal step increases, and four positions that were not in the amended 2003 budget. Two of these positions are new and two of these positions are filling current vacancies. The 2004 budget also includes additional operating expenses for the new Public Safety facility and the expanded City Hall facility. Personnel and these operating expenses are two of the bigger increases in the 2004 budget. S: ~Council~Pat~Budgct~ 1103balancing.doc Budget Staff Report November 10, 2003 Page 3 of 6 Expenditure Notes There is nothing very unusual in the 2004 expenditures as proposed. The department heads did an excellent job in keeping expenses down and submitting a "bare bones" type of budget as they knew that revenues were very limited based on the LGA cuts we are experiencing. Please see the attached capital outlay page for information on the planned equipment and vehicle purchases and how they are proposed to be financed. Additional comments on 2004 expenditures include the following: · Retains the volunteer appreciation program · Retains the city newsletter (six editions per year) · Retains the goose trapping program · Restores some national conferences for employees · Includes $3,000 for HPC projects (requested $5,000) and $1,500 for HPC travel and conferences (requested $3,000) · Adds the RequestPartners program · Includes $10,000 for the arts (this is an increase from past years) · Includes increased planning and recreation fees to help cover actual expenses (as approved in mid-year in 2003) · Reduces the contractual services for snowplowing · Eliminates the summer park ranger program · Eliminates the ice rink attendant program · Reduces the overlay/sealcoatmg program (as compared to the original 2003 budget) · Eliminates the employee recognition droner · Limits the part time summer help for park maintenance · For the second year in a row, does not include a tree planting program (however the Utilities have a program) · No funds provided for the fish stocking program · No funds for the Chamber dues (the EDA is a member) One additional item to note is that there are adequate funds in the budget under contractual services for the cleaning of City Hall and the Public Safety facility (mainly the police station). These services are being evaluated and it may very well be the recommendation that these contracts end in the near future and we proceed with the hiring of part time employees for cleaning. These employees would be under the supervision of the building maintenance employee, Gary Lore. 2004 BUDGET GAP There are not too many small budget amendments to consider in looking at closing the projected 2004 budget gap. Most of the adjustments to consider are larger in scale. One of the most important issues for the Council to consider is how to use the additional Host Fee money and whether or not all of this money should be designated for capital projects or whether or not some of these monies should be used in the short term to balance the annual operating budgets. The projection is that approximately $290,000 will be available from the Host Fee in 2004. S: ~Council~Pat~Budgct~ 1103balancing.doc 3 dget S t ,ff Reort Options to close the projected 2004 budget gap include: November 10, 2003 Page 4 of 6 · Use some of the Host Fee revenues · Use some of the general fund unreserved fund balance that is in excess of 40 percent · Use some liquor store reserves · Increase the growth related revenue projections · Reconsider a gas franchise fee · Reduce expenditures by way of not adding additional employees If $80,100 of additional expenses are added to the proposed 2004 budget, then the total proposed expenditures are $7,845,050. Forty percent of this amount (for a Fund Balance) is $3,138,020. At the end of 2002 the city had a Fund Balance of $3,190,589. Additionally, at this time it looks like revenues will exceed expenditures in 2003 by over $100,000. The 2003 growth related revenues are far exceeding the budgeted amount. It seems reasonable to increase our 2004 projections to the 2002 amount that was actually received. The high level of growth related revenues appears to be due to the increase in townhome development and the arrival of some large scale developers/builders in the community. It is likely that the 2003 level will continue into 2004, but whether or not it continues after that is less certain. Even if we set the 2004 growth related revenues at the 2002 amount, it is anticipated that revenues will exceed this level if activity continues at the same pace as what we are currently experiencing. RECOMMENDATION I recommend that the City Council make a few miscellaneous expenditure adjustments and add the Park and Recreation Director position to the budget for 2004. This means that we need to address a $225,500 budget gap. To close this 2004 budget gap, I recommend that the city use a combination of the Fund Balance (minimum of $100,000), increase the growth related revenues to the 2002 actual amounts received (an $88,850 increase), and use liquor store monies as necessary (up to $50,000) to eliminate the 2004 budget gap. I also recommend that when the CIP is reviewed that the City Council consider designating the Host Fee for a major capital project. As noted above, there are monies available in the Fund Balance to help with the 2004 budget and still maintain the 40 percent level. The Council could increase the amount used to balance the 2004 budget and decrease the amount of liquor store monies that are needed. The Liquor Store Fund is being used in 2003 for part of the gun range and may be used in 2004 for part of the ice arena barn floor. Whether or not the city wants to decrease the Liquor Store fund balance any more is a Council discussion item. Use of the cash flow reserves (and to a lesser degree, the liquor store reserves) should be viewed as "one time" type of revenue option. These funds will need to be replaced with tax revenues. CAPITAL IMPROVEMENT PROGRAM In addition to the discussion on the 2003 and 2004 operating budgets that took place on August 25 and September 8, 2003, the City Council also reviewed a few capital improvement S:~Council~Pat\Budget\ 1103balancing.doc Budget Staff Report November 10, 2003 Page 5 of 6 program (CIP) items. The main CIP discussion items were the timing and funding for the replacement of the barn floor, the timing of the fire truck purchase (Engine #2 replacement), and the funding for the city portion of the Pavement Rehabilitation Program (PRP). /ce Arena Floor The Council has had periodic updates over the past month regarding the status of the barn floor. It appears that the floor will make it another year but that ice will not be available until later than normal. The delay is costing the city revenues and we are incurring additional expenses in trying to correct the problems to get ice established in the barn. In this regard, the General Fund contribution to the Ice Arena at the end of 2003 will be substantially higher than originally anticipated. This will slightly reduce the flexibility the city has svith its Fund Balance at the end of the year. In terms of financing the $400,000 to $425,000 floor replacement project in 2004 the city has a couple of options. One option is to use some NSP funds and some Liquor Store funds to pay for the project. The other option is to use the Government Building Reserve money; but this money is not available until 2005. (The Government Building Reserve obtains its money through the Landfill Surcharge, which has now become part of the Host Fee.) This arena floor financing decision should be made either when the bids are approved on November 10, 2003 or when the updated five year CIP is reviewed. The recommended approach is to use NSP and Liquor Store funds. (In 2005 the Council, at their discretion, can always move the Government Building Reserve money to other funds.) Fire Truck The City Council has expressed a desire to finance the $375,000 fire truck engine over two years. Accordingly, the fire department is moving forward assuming that the truck will be purchased and paid for in later 2004 and early 2005. In the next few months staff will get a recommendation to the City Council on how this truck should be funded. The two main approaches available are Equipment Reserves and Equipment Certificates that are repaid with tax monies. Additionally, the Fire Chief is obtaining information on truck funding options from various manufacturers. Regardless of the funding approach, a significant amount of money will be required by the end of 2004 and this source will likely be Equipment Reserves. This truck funding issue should be finalized when the CIP is reviesved. Pavement Rehabilitation Program (PRP) The first phase of the PRP took place in 2003 and in very "round numbers" the city is using its street reserves (Landfill Surcharge money that is now part of the Host Fee) for about one- third of the project, tax revenues for about one-third of the project, and assessing out about one-third of the project. The original concept was about one million dollars worth of improvements every other year but the final outcome may be larger projects on an every other year or every third year timetable. The city has accumulated about $276,000 in tax monies for this program and has $100,000 in the 2004 tax levy. The city is in good shape initially with this program but we still need to work out the details in terms of what we can afford and what makes sense from a bonding and construction point of viesv. S: ~Council~Pat~BudgctN 1103balancing.doc Budget Staff Report November 10, 2003 Page 6 of 6 OTHER BUDGET ACTIVITIES In addition to balancing the 2004 General Fund budget the City Council will also need to review some additional financial issues. On November 24, 2003, the Enterprise Funds will be presented to the City Council. The Liquor Store Fund and the Garbage Fund are very straightforward but the sewer budget will need some discussion as there are some major capital improvements on the horizon. Also, m December, the Council will be asked to consider the 2004 pay resolution. The county has approved a three percent increase and we are looking at a three percent increase for the police union. The 2004 budget includes funding for a three percent increase for city employees. The Truth-M-Taxation public hearing will be held on December 8, 2003 and at that time the tax levy, general fund budget, and supplemental budgets will all be reviewed and discussed. Finally, within the next few months the update of the five year Capital Improvement Program will be presented to the City Council. ATTACHMENTS · 2004 Proposed General Fund Revenues · Tax Levy Information · 2004 General Fund Expenditures Summary Page · 2004 General Fund Expenditures Summary Analysis (5 pages) · Personal Services Page · Capital Outlay Page · 4 Newspaper Articles · City Newsletter-Budget Article S: \Council\Pat\Budget\ 1103balancing.doc City of Elk River General Fund Revenue PROPOSED ADOPTED ACTUALREVENUE RECEIVED BUDGET BUDGET A~ualto 2004 2003 July, 2003 2002 2001 2000 1999 1998 Taxes Ad Valorem 5,128,250 4,588,800 2,232,691 3,937,875 3,911,464 3,289,348 3,058,053 2,632,140 Gravel 54,000 54,000 24,623 54,377 54,737 53,633 56,858 51,269 TotaI Taxes 5,182,250 4,642,800 2,257,314 3,992,252 3,966,201 3,342,981 3,114,711 2,883,409 License & Permits Liquor 52,000 53,450 49,853 40,915 44,858 43,354 35,386 37,324 Amusement 1,400 1,400 1,530 1,485 1,215 1,395 3,430 Cigare~e 3,000 3,000 156 3,175 2,600 2,342 2,125 2,595 Apa~ment 15,000 13,500 15,840 15,840 12,672 11,956 11,016 15,696 Gas Fi~ers 3,000 3,000 2,205 4,725 5,005 2,601 2,640 2,736 Mining 13,500 13,500 14,014 13,596 8,830 18,172 12,547 12,160 Garbage Hauler 850 850 855 540 861 990 1,905 1,140 Other Business 16,000 15,000 13,355 25,251 10,550 9,262 8,335 7,165 Building Permit 444,800 419,550 437,286 494,235 631,031 543,562 363,351 376,909 Plumbing/Heating Permit 99,100 90,000 95,1'36 110,087 245,232 101,524 62,278 70,302 Permit Surcharge 1,400 1,200 5,558 1,688 1,573 1,237 913 1,035 Electric Permit 143 250 233 208 263 365 AnimalLicense 1,500 1,500 1,457 1,630 1,506 2,250 2,021 1,828 Parking Permit 148 248 204 384 600 324 Other Non Business 4,000 6,000 5,450 2,143 22,614 10,833 6,532 7,817 TotalLicenses & Permits 555,550 821,950 641,456 715,853 989,052 749,890 511,307 540,826 Intergovernmental Revenue COPS Grant 347 19,011 24,784 70,818 84,740 124,340 LGA 293,150 937,150 146,562 937,155 324,150 276,977 198,188 241,573 HACA 522,899 500,644 498,244 508,880 Homestead Credit 297,127 LPA - 17,760 18,581 Low Income Housing Aid 8,777 9,893 13,274 'ERA Aid 11,500 11,500 9,187 11,514 11,514 11,514 11,514 18,373 ~lice Aid 140,000 132,000 139,972 131,106 135,997 137,871 119,141 Police Training Reimb. 10,500 10,500 11,030 10,483 10,886 7,901 6,646 State Aid Street Maint. 35,000 33,350 35,970 35,025 33,360 30,300 29,716 29,341 State Crime Prevention Grant 10,500 9,750 '1,303 11,113 10,173 14,930 34,857 34,253 Other State Grants 10,000 4,150 1,500 3,379 14,308 8,469 Other Local Grants 500 3,000 19,300 - 12,524 8,909 Total Intgvtl. Revenue 500,650 1,134,250 212,646 1,478,990 1,102,543 1,055,445 1,047,623 1,118,506 Charges for Services Admin. Project Fees 25,000 50,000 6,488 37,740 Planning & Zoning Fees 20,000 20,000 18,506 19,705 21,111 21,320 18,765 19,310 Plan Check Fees 255,650 252,300 254,240 284,069 376,383 328,112 213,400 223,632 Special Assmt. Search 2,000 1,800 2,475 2,4~0 2,010 1,635 3,075 8,775 Sale of Maps/Copies 2,500 4,500 1,477 3,453 5,312 7,160 2,336 2,670 Reimb. For Gert Govt Sen/ 15 2,041 3,870 2,750 Lockout Fees 16,000 20,000 7,875 1,400 Reimb. For Police Services 4,000 4,000 2,027 4,637 7,891 10,979 17,049 14,671 School Liaison 21,500 21,500 43,000 43,000 43,000 65,000 60,000 Mobile Connection Fees 3,000 3,000 2,400 Animal Impound 2,500 2,500 1,530 2,800 2,990 2,285 2,755 2,967 Vehicle Impound - 183 30 30 400 547 565 Fire Contracts 80,000 79,000 131,159 81,591 78,523 84,705 78,166 63,848 Fire Calls 5,000 7,000 1,350 11,200 4,650 15,360 8,438 8,650 Street Services 25,000 30,000 13,071 24,085 15,587 17,686 18,333 16,167 Recreation Fees 110,000 97,500 85,559 101,617 65,845 55,180 54,031 54,859 Concessions 30,000 52,000 13,551 36,869 Park Fees/Bldg Rent 15,900 21,100 .11,545 13, 718 3,081 Softball League Fees Sewer Inspection Fee 10,000 7,000 9,481 10,713 11,190 3,787 1,500 2,940 Contractor License Check 2,400 2,000 1,945 2,385 2,100 1,845 1,315 TotatChargesforSen/ice 605,450 647,200 558,989 648,113 693,373 596,204 491,198 516,794 Cou~ 165,000 150,000 84,379 130,025 83,416 109,826 111,584 110,713 Parking 5,000 6,000 3,355 4,815 5,805 9,595 6,030 5,040 Total Fines 170,000 156,000 87,734 134,840 89,221 119,421 117,614 115,753 Finance Dept. ~/22J2003:REVSUM Page 1 City of Elk River General Fund Revenue PROPOSED ADOPTED BUDGET BUDGET Actual to 2004 2003. July, 2003 2002 2001 2000 1999 1998 Other Revenue Interest Income 75,000 90,000 39,867 76,714 106,262 161,759 53,578 119,115 Vending Machines (Emp.) 74 37 58 982 1,977 Solid Waste Surcharge 9,000 9,000 9,000 9,000 9,000 9,000 9,000 Refunds & Reimb. 1,500 61 19 2,009 692 3,316 11,086 Contributions 3,700 3,700 4,700 2,700 5,650 3,700 3,700 3,700 Miscellaneous 3,000 3,000 1,852 12,305 4,499 4,573 5,608 2,213 Total Other Revenue 81,700 107,200 55,554 100,775 127,420 179,782 76,184 147,091 ACTUAL REVENUE RECEIVED Transfers In Landfill 30,000 30,000 28,000 19,750 19,750 19,750 Capital Outlay Reserve 18,000 25,000 10,000 20,000 42,778 43,050 Street Reserve 45,000 45,000 NS P/R DF Reserve 39,500 39,500 39,500 39,500 39,500 19,750 19,750 19,750 Development Fund 3,050 3,900 16,522 Drug Forfeiture 6,224 VVWTS 15,000 15,000 15,000 10,000 10,000 10,000 8,000 8,000 Liquor 145,000 145,000 145,000 120,000 110,000 110,000 110,000 123,450 ERMU 105,000 105,000 70,000 100,000 90,000 90,000 90,000 78,000 EDA 22,950 5,000 3,000 3,000 2,000 2,000 2,000 HRA 3,500 1,500 1,500 1,500 1,000 1,000 1,000 Other 20,000 - Total Transfers In 423,950 386,000 269,500 347,000 273,274 276,400 309,800 295,000 TOTAL GENERAL FUND 7,619,550 7,695,400 4,083,193 7,417,823 7,241,084 8,320,123 5,668,437 5,417,379 ~VENUE SUMMARY , otal Taxes 5,182,250 4,642,800 2,257,314 3,992,252 3,966,201 3,342,981 3,114,711 2,683,409 Percent Change 11.62% 16.30% 0.66% 18.64% 7.33% 16.07% 6.59% Percent of Total 68.01% 60.33% 53.82% 54.77% 52.89% 54.95% 49.53% Total Licenses & Permits 655,550 621,950 641,456 715,853 989,052 749,890 511,307 540,826 Percent Change 5.40% -13.12% -27.62% 31.89% 46.66% -5.46% 9.85% Percent of Total 8.60% 8.08% 9.65% 13.66% 11.87% 9.02% 9.98% Total Intgvtl. Revenue 500,650 1,134,250 212,646 1,478,990 1,102,543 1,055,445 1,047,623 1,118,506 Percent Change -55.86% -23.31% 34.14% 4.46% 0.75% -6.34% 12.30% Percent of Total 6.57% 14.74% 19.94% 15.23% 16.70% 18.48% 20.85% Total Charges for Service 605,450 647,200 558,989 648,113 693,373 596,204 491,198 516,794 Percent Change -6.45% -0.14% -6.53% 16.30% 21.38% -4.95% 1.34% Percent of Total 7.95% 8.41% 8.74% 9.58% 9.43% 8.67% 9.54% Total Fines 170,000 156,000 87,734 134,840 89,221 119,421 117,614 115,753 Percent Change 8.97% 15.69% 51.13% -25.29% 1.54% 1.61 % 37.44% Percent of Total 2.23% 2.03% 1.82% 1.23% 1.89% 2.07% 2.14% Total Other Revenue 81,700 107,200 55,554 100,775 127,420 179,782 76,184 147,091 Percent Change -23.79% 6.38% -20.91% -29.13% 135.98% -48.21% 21.23% Percent of Total 1.07% 1.39% 1.36% 1.76% 2.84% 1.34% 2.72% Total Transfers In 423,950 386,000 269,500 347,000 273,274 276,400 309,800 295,000 Percent Change 9.83% 11.24% 26.98% -1.13% -10.78% 5.02% 9.19% Percent of Total 5.56% 5.02% 4.68% 3.77% 4.37% 5.47% 5.45% TOTAL GENERAL FUND 7,619,550 7,695,400 4,083,193 7,417,823 7,241,084 6,320,123 5,668,437 5,417,379 Percent Change -0.99% 3.74% 2.44% 14.57% 11.50% 4.63% 8.53% Finance Dept. 8/22/2003:REVSUM Page 2 RESOLUTION 03 - _54 A RESOLUTION FOR THE CITY OF ELK RIVER A RESOLUTION AUTHORIZING THE PROPOSED PROPERTY TAX LEVY FOR COLLECTION IN 2004 WHEREAS, the Elk River City Council has reviewed the City's anticipated expenditures for all funds in 2004; and, WHEREAS, the Elk River City Council has considered projected revenues for all funds in 2004; and, WHEREAS, revenues from sources other than property taxes are not sufficient to meet anticipated expenditures of all funds; and, WHEREAS, debt levies have been adjusted or cancelled based on revenue collections and projections. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk River that the following amounts are the maximum to be levied as property taxes payable in 2004: General Fund Street Replacement Library Surface Water Management City Special Assessments 1994 Storm Sewer Bonds 2003 Improvement Bonds 2004 Certificate of Indebtedness 2003 Certificate of Indebtedness 2000 Certificate of Indebtedness PERA Employer Rate Increase .Public Safety Lease Revenue Bonds Economic Development Tax Abatement TOTAL Levy $5,117,598 69,000 175,000 25,164 116,230 100,000 140,000 129,203 38,826 11,675 638,263 3,844 $8,564,803 Passed and adopted by the City Council of the City of Elk River this day of September, 2003. ATTEST. h September 4, 2003 Sherburn~ A UDITOR/TREASURER RAMONA DOEBLER To: City Administrators, Clerks and Finance Officers And School District Administrators and Finance Officers From: Ramona Re: Preliminary 2003 Tax Values (for Proposed 2004 Tax Notices) Following is the early Pay 2004 Net Tax Capacity and Market Value information for your City, Township or School District. Countywide, there is an 11.37% increase in Net Tax Capacity and a 12.83% increase in total county Taxable Market Value. Please remember that these values may drop slightly by next spring when final values are certified, due to abatements, property tax forfeitures, late homesteads and clerical corrections. RE&PP Less 10% 200 KV Township/City/School District ~', ,~7~L..=~ ~ 2003 Net Tax Capacity Values 2004 Preliminary NTC Values f3: ~q 3: ~?3,3- /,.% c¢,..:o, og, o Less Captured TIF Tax Rate NTC Taxable Market Value: MV Referendum ///3///7~ co o /, 763-241-2861 13880 Highway 10 Elk River, MN 55330-4601 1-800-438-0576 ~ Fax: 763-241-2869 PRELIMINARY LEVY SAMPLE FOR TAXES PAYABLE 2004 General Fund* Street Replacement Library* Surface Water Mgmt. City Special Assessments 1994 Storm Sewer 8onds 2003 Improvement Bonds (~¢c~'.f 2004 Certificate of Indebtedness 2003 Certificate of Indebtedness 2000 Certificate of Indebtedness PERA Employer Rate Increase Public Safety Lease Rev. Bonds Economic Development Tax Abatement * LevY subject to change based on approved budget. Net $ 5,117,598 69,000 175,000 25,164 116,230 100,000 140,000 129,203 38,826 11,675 638,263 3,844 $ 6,564,803 Limited Levy $ 5,361,598 Levy Limit 5,361,598 NTC Levy Tax Rate Payable 2003 13,404,503 5,980,161 44.613% 5%NTC Increase 7% NTC Increase 8% NTC Increase 9% NTC Increase Proposed Levy 14,074,728 6,564,803 46.642% 2003 Tax Rate 14,074,728 6,279,158 44.613% Proposed Levy 14,342,818 6,564,803 45.771% 2003 Tax Rate 14,342,818 6,398,761 44.613% Proposed Levy 14,476,863 6,564,803 45.347% 2003 Tax Rate 14,476,863 6,458,563 44.613% Proposed Levy 14,610,908 6,564,803 44.931% 2003 Tax Rate 14,610,908 6,518,365 44.613% 285,645 166,042 106,240 46,438 EDA HRA 5% increase in MV 7% increase in MV 9% Increase in MV County Estimated MV 5% increase in MV 7% increase in MV 9% Increase in MV County Estimated MV Market Value 1,155,029,800 1,212,781,290 1,235,881,886 1,258,982,482 1,156,029,800 1,212,781,290 1,235,881,886 1,258,982,482 Levv % 0.01813% 0.01813% 0.01813% 0.01813% 0.01813% 0.0131% 0.01310% 0.01310% 0.01310% 0.01310% TotalLevv 209,406.90 219,877.25 224,065.39 228,253.52 151,308.90 158,874.36 161,900.53 164,926.71 9~4~2003 TAXLEVY RESOLUTION 02.- A RESOLUTION FOR THE CITY OF ELK RIVER A RESOLUTION AUTHORIZING THE PROPERTY TAX LEVY FOR COLLECTION IN 2003 WHEREAS, the Elk River City Council has reviewed the City's anticipated expenditures for ail funds in 2003; and, WHEREAS, the EIk River City Council has considered projected revenues for ail funds in 2003; and, WHEREAS, revenues from sources other than proper~y taxes are not sufficient to meet anticipated expenditures of ail funds. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk River that the following amounts are to be levied as property taxes payable in 2003: General Fund Street Replacement Library Surface Water Management City Special Assessments 1 994 Storm Sewer Bonds 2003 Certificate of Indebtedness 2000 Certificate of Indebtedness 1999 Cer[ificate of Indebtedness PERA Employer Rate Increase Public Safety Lease Revenue Bonds Economic Development Tax Abatement TOTAL Levy $4,580,083 150,000 69,000 25,298 115,233 140,000 41,088 35,032 9,713 834,000 5,714 $5,980,161 Passed and adopted by the City Council of the City of Elk River this 9th day of December, 2002. A'F'FEST: Stephanie Klinzing, Mayor Sandra A. Peine, City Clerk APPROPRIATIONS SUMMARY 2001 2002 2003 2004 ACTUAL ACTUAL AMENDED PROPOSED $ 153,458 $ 162,513 $ 170,200 $ 163,850 53,916 64,184 59,850 64,900 322,966 328,441 346,700 379,900 10,680 44,091 - 36,200 325,016 403,576 344,050 370,000 97,500 160,750 54,695 197,096 206,200 206,450 241,991 327,435 284,250 300,200 146,130 136,472 109,850 139,300 140,882 27,527 75,000 75,000 2,441,444 2,508,214 2,527,350 2,706,200 361,092 376,485 397,800 411,900 19,183 25,729 23,450 23,150 515,174 546,460 523,300 531,250 776,801 764,757 717,100 756,850 113,055 95,090 152,050 165,800 205,239 254,462 265,450 266,350 177,816 134,709 75,000 75,000 289,342 288,978 276,300 321,900 236,303 372,086 386,750 416,600 88,297 81,950 80,200 84,850 19,183 21,134 - 11,386 8,870 16,850 16,950 197,570 119,154 113,200 91,600 MAYOR & COUNCIL CABLE TV ADMINISTRATION ELECTIONS FINANCE INFORMATION TECHNOLOGY LEGAL PLANNING GOVERNMENT BUILDINGS CONTINGENCY POLICE FIRE EMERGENCY PREPAREDNESS BUILDING & ENVIRONMENTAL STREETS SNOW REMOVAL EQUIPMENT SERVICES ENGINEERING PARKS RECREATION SR. CITIZEN PROGRAMS ECONOMIC DEVELOPMENT ENERGY CITY TRANSFERS TOTAL $ 6,881,619 $ 7,289,413 $ 7,248,400 $ 7,764,950 8/21/2003 General Government City Council Dollar Change Percent Change Cable TV Dollar Change Percent Change Administration DOllar Change Percent Change Finance Dollar Change Percent Change InformatiOn Techno Ogy DOllar Change percent Change Elections Dollar Change Percent Change Legal Dollar Change Percent Change Energy City Dollar Change Percent Change Planning Do#ar Change P~rcent Change Govt BldgslCi~ Hall Do#ar Change Percent Change Council Contingency Do#ar Change Percent Change Total General Government General Fund Expt re Summary Data Proposed 2004 and Adopted 2003 2004 Proposed 2003 Amended Personal Other Svcs. C.G. Personal Other Svcs. Capital Services Supplies & Charges Transfers Total Services Supplies & Charges Outlay Total 34,300 3,200 126,350 (6,350) 0.00% 0.00% -4.79% 60,350 2,400 2,150 7, 550 (1,700) (800) 14.30% -41.46% -27. 12% 317,600 9,400 52,900 241950 (350) & ~00 8.53% -3.59% 19.41% 303,600 6,600 59,800 8, 700 350 16, 900 2. 95% 5.60% 39.39% 124,750 30,000 6,000 50,150 12,000 1,100 67. 23% 66.67% 22.45% 28,000 3,500 4,700 28, 000 3, 500 4, 700 #DI V/Of #DI V/O! #DI V/O! 145,000 2,850 58,600 600 (1,650) 1,300 2.27% 12,250 4,700 1,100 (1,000) 987% -17.54% 273,000 6,200 21,000 10,100 (300) 6~ 150 3.84% ~4.62% 41.41% 33,300 14,750 91,250 8, 600 4, 000 16, 850 3482% 37.21% 22.65% 75,000 0,00% 1,332,150 5 78,900 $ #DIV/O! 502,450 $ $ 163,850 (6, -3. 73% 64,900 5,050 8.44% 379,900 33,200 9.58% 370,000 25,950 7.54% 160,750 63,250 64.87% 36,200 36,200 #DIV/O! 206,450 250 0.12% 16,950 100 059% 300 200 15,95o 5.61% 139,300 29,450 26.81% 76,000 0.00% 34~300 3~200 132,700 ~ 170,200 52,800 4,100 2,950 292,650 9,750 44,300 294,900 6,250 42,900 74,600 18,000 4,900 59,850 346,700 344,050 97,500 i44,400 4,500 57,300 ~ 2061200 5,700 6,500 14,850 10,750 74,400 11,150 262i900 24,700 75,000 t,913,500 $ 1,192,400 $ 63,050 $ 455,000 $ 16,850 284,250 109,850 75,000 1,710,450 Percent of General Government Percenl of Total General Fund Percent of Expend. Calegory Percent increase Amount o! Increase (Decrease) 69.62% 4.12% 26.26% 17.16% 1.02% 6.47% 22.90% 12.94% 40.31% 11.72% 25.14% 10.43% 139.750 $ 15.850 $ 47.450 0.00% 0.00% 0.00% 0.00% 100.00%] 24.64%] 24.64%] 11.87%I 203,050 [ 69.71% 3.69% 26.60% 0.00% 16.45% 0.87% 628% 0.00% 2203% 10.77% 39.97% 0.00% 100.00%I 23 60%[ 23.60%] Finance 8/22/2003:EXPSUMM Public Safety Building & Environmental Dollar Change Percent Change Police Administration Patrol Invesligalions Suppod Services Police Reserves Building Maintenance Total Police Dollar Change Percent Change Fire Fire Fighting/Administration Fire Inspections Total Fire Dollar Change Percent Change Emergency Management Dollar Change Percent Change Total Public Safety General Fund Exp[ are Summary Data Proposed 2004 and Adopted 2003 2004 Proposed 2003 Amended Personal Other Svcs. C.G. Personal Other Svcs. Capital Services Supplies & Charges Transfers Total Services Supplies & Charges Outlay Total 488,060 10,150 2.12% 252,800 1,322,250 427,100 272,150 6,100 41,350 2,321,750 144,350 6.63% 213,600 83~250 296,850 13, 800 4.88% 9,100 1,050 13.04% 3,115,750 18,100 25,100 . 531,250 (350) (1.850) 7, 950 - 1,90% -6.86% 1.52% 16,650 110,400 379,850 104,300 41,500 1,468,050 10,650 9,650 447,400 12,300 14,550 299,000 11,200 9,000 26,300 4,000 40,250 85,600 159,100 228,350 2,706,200 4,000 3~500 17&850 2.58% 15.65% 7.08% 33,050 74,850 3,450 3,700 36,500 78 550 (2,20~ 2,500 -5.68% 3.29% 3,450 10,600 (1,35~ -28.13% 321,500 90~400 411,900 3.54 % 23,150 (300) -1.28% 477,900 18,460 26,950 196,550 12,200 105,850 1,295,400 108,650 42,150 405,750 11,600 6,700 273,600 15,150 9,100 6,100 6,500 5,450 1,000 25,600 2,177,400 155,100 194,850 205,400 35,400 72 250 77fi50 3,300 3~80Q 283,050 38,700 76i050 8,050 4,800 10,600 523,300 314,600 1,446,200 424,050 297,850 18,050 26,600 2,527,350 313,050 84,750 397,800 23,450 O. O0 % 217,150 339,600 3,672,500 2,946,400 217,050 308,450 3,471,900 I 5.91% 9.25% 0.00°/0 100.00°/01 84.86% 6.25% 8.88% 0.00°/0 100.00°/0[ 2.80% 4.37°/0 0.00% 47.30°/o] 40.65% 2.99% 4.26% 0.00°/0 47.90%]1 35-61°/0 27.25% 0.00% 47.30°/01 54.45% 37.09% 27.10% 0.00% 47.90O/ol 0.05% 10.10% 5.78%J I 100 $ 31,150 $ $ 200,600 I I Percent of Public Safety Percent of Tolal General Fund Percent of Expend. Category Percent Increase Amount of Increase (Decrease) 84.84% 40.13% 53.56% 5.75% 169,350 8/22/2003:EXPSUMM General Fund ExpL ire Summary Data Proposed 2004 and Adopted 2003 2004 Proposed 2003 Amended Personal Other Svcs. C.O. Personal Other Svcs. Capital Services Supplies & Charges Transfers Total Services Supplies & Charges Outlay Total Public Works Streets 511~750 90,000 155i100 - 756i850 Dollar Change 21,750 9, 700 8,300 39, 750 Percent Change 4.44% 12.08% 5.65% 5.54% Snow Removal 132,800 30,000 3,000 165,800 Do/lar Change 11,250 2, 500 13, 750 Percent Change g. 26% g. 09% O. 00% 9.04% Equipment Services 165,350 95,500 5,500 . 266~350 Dollar Change 4, 300 (3, 400) 900 Percent Change 2. 67% -3.44% O. 00% O. 34% Engineering 75,000 75,000 Dollar Change Percent Change 0.00% Total Public Works 490~000 80,300 146i800 717,100 121,550 27,500 3,000 152,050 161,050 98,900 8,500 265,450 75,000 75,000 Percent of Public Works Percent of Total General Fund Percent of Expend. Category Percent Increase Amount of Increase (Decrease)+A1 $ O. O0 % 809,900 215,500 238,600 t,264,000 772,600 206,700 230,300 1,209,600 64.07% 17.05% 18.88% 0.00% 100.00% t 0.43% 2.78% 3.07% 0.00% 16.28% 13 92% 35.34% 19.14% 0.00% 16.28% 4.83% 4.26% 3.60% 0.00% 4.50% 37,300 $ 8,800 $ 8,300 $ $ 54,400 63.87% 17.09% 19.04% 0.00% 100.00% 10.66% 2.85% 3.18% 0.00% 16.69% 14.28% 35.32% 20.23% 0.00% 16.69% 8/22/2003:EXPSUMM General Fund Expe ,-e Summary Data Proposed 2004 and Adopted 2003 2004 Proposed 2003 Amended Personal Other Svcs. C.C. Personal Other Svcs. Capital Services Supplies & Charges Transfers Total Services Supplies & Charges Outlay Total Culture and Recreation Park Maintenance Dollar Change Percent Change Recreation Administration Programming Concessions Total Recreation Dollar Change Percent Change Sr. Citizen Programs Dollar Change Percent Change Total Recreation 235,800 43,000 43,100 321,900 33, 600 5, 000 7, 000 45, 600 1662% 13.16% 19.39% 16.50% 167,550 7,500 58,850 233;900 59,500 22~000 55,600 137,100 20,500 22~500 2~600 45,600 247,550 52,000 117~050 416,600 21,300 (5, 450) 14, 000 29, 850 9.41% -9,49% 13.59% 7. 72% 76,000 3,250 5,600 84,850 4,300 250 100 4,650 6. 00% 8.33% 1.82% 5. 80% 202,200 38,000 36,100 276,300 164,250 9,000 58,650 23i 900 45 350 24,950 42 850 113,150 16,650 23,500 1,550 ~ 41,700 226,250 57,450 103,050 386,750 71,700 3,000 5,500 80,200 559,350 98,250 165,750 823,350 500,150 98,450 144,650 743,250 Percent of Recrea{ion Percenl of Tolal General Fund Percent of Expend. Category Percenl Increase Amounl of Increase (Decrease) I 67.94°/. 11.93% 20.13% 0.00% 100.00"/ol 67.29"/0 13.25% 19.46% o.oo% lOO.OO%1 7.20°/. 1.27"/0 2.13% 0.00°/0 lO.6O%I' 6.90% 1.36"/. 2.00% 0.00o/. ~0.25%,' 9.62°/. 16.11% 13.30% 0.00% 10.60%I 9.24% 16.82% 12.71% 0.00% 10.25%I 11.84% -0.20% 14.59% 0.00% 10.7S%I I I Finance 8/22/2003:EXPSUMM General Fund Exp, ,ute Summary Data Proposed 2004 and Adopted 2003 2004 Proposed 2003 Amended Personal Other Svcs. C.O. Personal Other Svcs. Capital Services Supplies & Charges Transfers Total Services Supplies & Charges Outlay Total Transfers Out Capital Outlay Reserve Ice Arena Operating Gov't Buildings Reserve City Hall Debt Service Total Transfers Out Percenl of Transfers Out Percent of Total General Fund Percent of Expend. Category Percenl Increase Amount of Increase (Decrease) TOTALGENERALFUND 25,000 25,000 66,600 66,600 18,000 18,000 28,600 28,600 66,600 66,600 91,600 91,600 113,200 113,200 0.00% 0.00% 0.00% 100.00% 100.00% 0.00% 0.00% 0.00% 1.56% 1.56% QQ0% 0.00% 0.00% 100.00% 1.56% 0.00% 0.00% 0.00% -1.65% -1.65% $ $ $ $ (1,900) $ (1,900 0.00% 0.00% 0.00% 100.00% 100.00% 0.00% 0.00% 0.00% 1.18% 1.18% 0.00% 0.00% 0.00% 100.00% 1.18% 0.00% 0.00% 0.00% -19.08% -19.08% $ $ $ $ (21,600) $ (21,600) 5,817,150 609,800 1,246,400 91,600 I 7,764,950 5,4tl,550 585,250 1,138,400 113,200 7,248,400 Percent of Total General Fund Percent Increase Amount of Increase (Decrease) 74.92% 7.85% 16.05% 1.18% 100.00% 7.50% 4.19% 9.49% -19.08% 7.13% $ 405,600 $ 24,550 $ 108,000 $ (21,600) $ 516,550 74.66% 8.07% 15.71% 1.56% 100.00% Finance 812212003 :E XP SUMM NEW POSITIONS REQUESTED 2004 Departrhent IT Split Street Police Position PC'Technician Bldg. & Grounds Maintenance Maintenance I Police Officer Requested Full time Full time Full time Full time Included in Cost of Proposed Request Bud.qet $ 48,648 $ 48,648 33,506 33,506 42,817 42,817 47,974 47,974 SUBTOTAL NEW POSITIONS $ 172,945 $ 172,945 8/21/2003 2004 CAPITAL OUTLAY Funding Source General Equipment Equipment 0epartment Department Item Fund Certificate Reser,ze Total Mayor & Council Cable TV Administration Finance Elections Planning Gov't. Buildings Police Police Vehicles (marked) - 3 including setup 87,000 Police Vehicles (unmarked) - 1 including setup 25,000 Motorcycle 16.000 128,000 Police Reserve - Fire Grass Rig 2 45,000 45,000 Emergency Mgmt. Siren 14,300 14,300 Building & Environ. Inspector Truck 24,000 24,000 Streets Single Axel Dump with plow equipment 135,000 Backhoe 25,000 Fork Lift 10,000 170,000 Tool Cat with A~achments 50,000 50,000 Snow Removal Equipment Services Plasma Cutter, Welder, Diagnostic Tool 8,500 8,500I Park Maintenance Recreation Subtotal $ $ 33t,000 $ 108,800 $ 439,800 8/21/2003 CAP!TALO:04 CaD Outlay MONDAY, NOVEMBER 3, 2003 ANOKA .Critics fear new fee on natural gas just a start City Council could vote on plan tonight BY NANCY NGO Pioneer Press The city of Anoka plans to o~set part of a loss in state f~mding by charging residents md business owners a natural ghs. franchise fee. The move concerns some ~ople, who wonder whether the fee will be followed by 0thor new charges. !.-The City Council could approve a franchise fee resolu- tion at a meeting tonight. Council members see the fee asa key means for holding the bhdget steady in the next few years in the face of a decline in .s~t.e funding. And they hope that-~hanges made to the plan '.w~ tisfy opponents. ~.-',"rhere's been some opposi- tioh:.:The biggest complaints v~qr~'really from business and r~si'dential users saying this is a'fie~v tax, and it's not going to g~-,away and that basing it on u~.a~e, is not fair," said Mayor. Bjorn Skogquist. After citizen complaints, the proposal was changed to ifistlmte a four-year term on ~Phtural gas fee rather than '~u~..~mg it indefinitely. That v~a~';a future council would ~ to approve ex-tension of th~'.f~e beyond four years. ~he resolution 'also was changed to charge residents and-business owners a fiat rat~g rather than basing the fee oh]usage. :-.The fee, which would take effect Jan. 1, would bill $2.75 a rao. r~th to all residences that uSe natural gas. Businesses were divided into three cate- gories depending on size, with rates ranging from $8 to $900 a Other area cities with the fees include Coon Rapids, Mounds View, New Brighton, North St. Paul and St. Louis Park. month. The fee will apply to about 4,500 Anoka residents and more than 600 businesses. Next year, the city is looking at a $600,000 loss in local gov- ernment aid from the state. The franchise fee is expected to bring in $366,000 annuagy. The city expects to cover the remaining loss in aid by instituting a hiring freeze on some open positions and com- bining certah3 jobs. Although Anoka resident Ohm O'Dette is pleased by the changes to the original pro- posal, he is concerned it is the beginning of more such charges. "If they're going to start with natural gas, where's it going to end?" he asked. just think it's the wrong direc- tion to go, and the prospects of where they're going to cut it off scares me." Other area cities with natu- ral gas franchise fees include Coon Rapids, Mounds View, New Brighton, North St. Paul and St. Louis Park. Nancy Ngo can be reached at nngo@pioneerpress, com or~ 651- 228-2149. MOUNDS VIEW City seeks leVY' fOr 2 more officers Solution to reduced state funding sought BY ALLEN POWELL II Pioneer Press Many cities are scrambling to find ways to restore money cut by the state this past spring, but Mounds View is the~ only one looking for help from voters. The city is placing a tax ref- erendum on its Nov. 4 ballot that would allow it to increase prop-, erty taxes up to 0.021 percent to pay for two new patrol officers. When state lawmakers cui~ aid to local governments last spring in an effort to balance the state budget, they told cities~ to make up no more than 60 per- cent of the losses in higher property taxes unless they obtained voter permission. Like many cities, Mounds~ View is assessing enough property taxes to raise 60 per~ cent of the $456,000 it lost~ Unlike others, it is asking voteff~ for permission to raise more. Gary Carlson, a lobbyist with the League of Minnesota Citie~ said more cities might try what~ Mounds View is doing as tl~ ramifications of state cut6. become apparent. Aid to citie~ and towns was cut 21 percent b~ the state Legislature in 2003 anc~ will be cut an additional 6 per- cent for 2004. '~ lot of cities are just trying to figure out how to cope with the cuts to state aid, and many cities have not thought about exceeding the levy law," he said. The law restricting the amount of aid losses that cities can recoup through property taxes is supposed to expire in 2005, Carlson said, but it likely will be extended. State Rep. Connie Bernardy, DFL-Fridley, said it makes sense that cities would seek additional levy money, because Gov. Tim Pawlenty's decision not to raise taxes essentially shifted that job to municipalities. "The bottom line is that the governor did not keep 'no new taxes' in the state," she said. Daniel Wolter, director of communications for Pawlenty's office, said it will be up to Mounds View voters to deter; · -L-:~ whether the additional levy is worth it. "It's a local deci; TAX REFERENDUM, 6C :: ST. PAUL PIONEER PRESS referendum (continued) sion," he said in an e-mail. "It is up to the local leaders to make the case to voters on why such an increase is need- ed:" White Bear Lake lost about $493,834 in state aid, about the same as Mounds View, but the city never con- sidered using a tax referen- dum. said finance director Don Rainbow. "We haven't done any- thing like that in the 10 years I've been here," he said. White Bear Lake's fiscal performance policy, which sets thc guidelines for how the city gathers and spends money, frowns on using levies to generate operating funds. Levies should be used for long-term capital improve- ments, Rambow said. Fridley considered seek- ing funds for thc Springbrook Nature Center through a levy this November. That idea was ultimately discarded for 2003, but the levy should be on the ballot in 2004, said Rick Pribyl, the city's finance director. Mounds View officials say they decided to propose the special levy because they per- ceive the need for the officers as drastic and saw no other option. Without the levy, "I think (the idea of hiring more offi- cers) would just die," said Charlie Hansen, the city's finance director. "I don't know how else to come up with that much money." The city did not consider using reserves, Hansen said, because those are aimed at one-time expenses. '7~y time you're hiring an employee you've got payroll this year, payroll next year and the year after that," he said. "If you don't have a continuing source of income, you don't hire an employee." ............. ~n 2~00, Moun~is View tried to hire one new officer through a federal community- oriented policing grant, but its application was denied, Hansen said. In 2002, the city · was ready, to add an additign- al office~ but decided not to because of the looming cut- backs in local government aid. With those cuts now a reality, an additional levy is the only choice, Hansen said. Mounds View Police Chief Mike Sommer said the city has 1.3 officers per 1,000 .resi- dents, well below the national average of 2.5 and slightly below the state average of 1.6. If the levy passes, Mounds View staffing will rise tO 1.5 officers per 1,000 residents. Mounds View has 17 sworn officers right now, nine of whom are patrol officers. On average, there are four hoUrs every day in which only one patrol officer is on duty, Sommer said. That could be a safety haz- ard in a city that had 455.9 serious crimes per 10,000 resi- debts in 2002, Sommer said, a figure higher than the state's index of 356.1 and the national average of about 420. It also means more strain on a department that is receiving more calls for service from residents. "It would have been easy for me to do nothing," he said. "This (the special levy) is not the easy path to take." If Mounds View assesses the maximum 0.021 percent levy, it would produce an esti- mated $143,000 for new patrol officers, Hansen said. A resi- dent with a $141,100 home, the median value in the city, would .pay $29.63 more a year at the maximum levy. But the city probably would not assess the full levy until four years from now when the new officers have gained seniority, Hansen said. In 2004, the city would just levy enough to produce the $104,000 needed to pay the costs of hiring rookie officers. That $104,000 includes . expenses such as wages, health insurance, uniform costs and liab~ty insurance increases, he said. About $70,500 of the total cost will go directly toward wages. ff the Mounds View levy is approved, it would be perma- nent and could only be removed through a City' Council vote, Hansen said. Hansen said it is unlikely the city will seek another vote next year if the referendum is ~ voted down this year. --~ ~ Alldn po~e~i ~an b'ereached at apowell@pioneerpress~com.+ PAGE B4 · STAR TRIBUNE * ME O/ ATE SUNDAY, sEPTEMBER 21 · 2003 BUDGETS from B1 Spending plans, levies varywidely among cities The Minnesota House's nonpartisan research depart- ment, on the other hand, tak- ing into account the many re- strictions being placed on cities, predicted that most cities would levy to the max. A Star Tribune survey of se- lect suburban cities, conduct- ed during the past week, re- vealed that the latter assump- tion, in most cases, is coming tree. · But-as the surveys were re- turned, for every apparent trend -- from eye-popping levy increases to sweeping cuts to quality-of-life setbacks for events such as Lakeville's "Pan- drama of Progress" -- another city would weigh in with a c. omparative shrug. , As Gary Carlson, legislative director for the League of Min- nesota Cities, said a few months ago: "I've got 853 cities in this state. Every one has a Unique set of circumstances." Wide differences In response to a request, a dozen cities outlined their budget plans. Topics included proposed maximum levies, po- tential uses of budget reserves, specifying state-aid reductions and identifying one or two cuts the cities believed would be noticeable tO the public. All of the cities except Rose- ville said they plan to raise all the money they can to recover §tate funding losses -- an amount state law limited to 60 ' percent of the aid reductions. New Brighton, Fridley and Roseville each plan to tap more Spending plans under stress Though no trends are clear in the wake of state-aid losses, some Twin Cities suburbs will struggle with tax increases that are smaller than the growth in spending. 2004 Percentage Proposed proposed change 2004 levy City budget from 2003 increase Jordan $2.1 million +0.8 +~0 New Brighton $9.2 million -5.9 +11.2 Woodbu~ $23 million- -1.8 +3.8, Source: Star Tribune su~ey of c~ies than $1 million in reserves to plug budget holes~ Forest Lake, Jordan, Woodbury and .Eden Prairie would leave reserves untouched. Officials in high-growth ar- eas -- including Lakeville, An- dover and Shakopee -- said that the double hit of budget cuts and levy limits means that even if they manage to prevent layoffs, city services will be spread thinner as their popula- tions grow. There are big differences, however, in their respective levy proposals. Proposed levy increases ranged from a low of 1.4 per- cent in Andover to 14.7 percent in Shakopee. New Brighton, Jordan, Fridley; West St. Paul and Roseville also will consider double-digit percentage in- creases. (City levies make up one part of a homeowner's proper- ty-tax bill, along w:th county, school and special taxes; and property-value increases.) Fate of fireworks? The most glaring cut: Frid- ley's proposed elimination of all four staff positions at the Star Tribune Springbrook Nature Center, ef- feCtively ending interpretive programs. After the proposal was announced earlier this summer, a community outcry led the city to consider alter~ nate funding for next year. In Lakeville, in a 35-page budget statement doubling as a "back-to-basics" governance essay, Lakeville City Adminis- trator Robert Erickson noted how funding may have to be reduced for the city's 3B-year- old summer festival, the Pan- orama of PrOgress or "Pan:O- Prog.' Proposed cuts include police overtime for Pan-O- Prog Beer Brats and Bingo, street department overtime for Cruise Night -- and the luly 4th fireworks. How big a loss could that be? At the Pan-O-Prog Web site ~ http://www.panoprog.org ~ you will see a parade of clas- sic cars, a 2003 calendar filled with events such as a dance, cribbage and bowling tourna- ments, and a beach bash. Also featured prominently: the en-. dangered fireworks display. Such losses exact a long: term cost to a community, said Hastings City Council Member Danna Eliing Schultz: "The way government is set The fireworks display, he UP is that things move slowly ~ said, is the crowning event Of and things don't fall apart im- Rose Fest activities, and helps mediately," she said. But for residents, she added, there is definite "slow burn" potential in the loss of the little stuff and in the new inconveniences. So, maybe municipal fire- works are the common thread in this year's budget debates. Will Roseville skies be dark on July 4th? No way, said Mayor John Kysylyczyn. attract the private donations that make the other events possible. He said he fears that cutting pyrotechnics could en- danger the reSt ofthe festival; Another trend shot down; Anthony Lonetree is at alonetree@s- tartribune, com. Truth in taxation flier starts a war of words about 'truth' By Anthony Lonetree Star Tribune StaffWriter Truth in Taxation notices hit mail- boxes statewide beginning next week, painting worst-case scenarios for what homeowners could pay in prop- erty taxes in 2004. The final bill for city, county and school services must still be approved by each governmental unit in Decem- ber, but the preliminary notices are drawing unusual attention in this year of budget bloodletting. The Minnesota Chapter of the Na- tional Association of Industrial and Office Properties is spending $50,000 on a public education campaign that includes distribution of 200,000 copies of a four-page flier that fingers local government as the main culprit for the sharp property tax increases many communities are projecting for 2004: The flier, drawing information from the Minnesota Taxpayers Associ- ation's publication, "Understanding Your Property Taxes," offers a detailed dissection of the Truth in Taxation no- tices. TAXES continues on A6: -- State legislator wants notices deliv- ered before each fall's election. Page A6 · Star Tribune * Monday, November 3 · 2003 TAXES from A1 House researchers predict 10.9 % increase on average The flier employs a retro look, with orange colors and bold headlines. "The state leg- islature designed the property tax system, but it's your local government officials who de- cide how much you must pay!" shouts one heading. The flashy piece was panned Friday by League of percent statewide. Sbme cities, counties and schools have made preliminary moves to raise taxes by double- digit percentages, but Carlson, of the League of Minnesota Cit- ies, said there had been little in the way of street-level talk about taxes, a situation he said could change with next week's Tax truths By early November, Minnesota property owners should receive Truth in Taxation notices outlining their proposed 2004 taxes and how taxpayers can participate in local government deliberations on taxes and spending. Here's a guide to the information contained in the statements. Minnesota Cities officials. What the flier "casually ig- nores,'' said Gary Carlson, the league's legislative director, is the fact that the Legislature and Gov. Tim Pawlenty cut $170 million in state aid to cit- ies. "It's a disservice," he said. Trouble ahead For about 20 years, counties have been required to calculate delivery of tax notices. Kaye Rakow, state public policy director for the Industri- al and Offices Properties group, hopes so. She acknowl- edged there have been aid cuts but said that the tax changes enacted by the 2001 Legislature made clear through the state's takeover of much of basic-edu- cation funding that local prop- erty taxes were just that local. "You have to go there for the Basic information about pro~rty tax system and the proposed property taxes described below. Your Proposed Property Tax for 2004 potential tax bills for each par- cel within their jurisdiction. The projections are based in part on the proposed "maxi- mum" levies set by cities, counties and school districts, numbers that often are low- ered when the bodies take final action on tax plans in Decem- ber. The tax notices also specify dates for each government en- tity's troth in taxation hearing, but rarely have those events generated much excitement. This year, with the state Legislature slashing budgets and shifting the costs of some programs to local govern- ments, property owners have been put on notice that a healthy chunk of the revenue- raising side of budget-balanc- ing will fall to them. The Minnesota House's nonpartisan research depart- ment estimated this summer that property taxes next year would rise an average of 10.9 Property lOCation ....... and owners responsible for making the tax payment. place to start," she said. ~~"x ~,~ 1,104.114 In past years, the prelimi- nary tax statements were re- quired to include two columns ng o mucho a opo ed I t~ ~crease ~ or decrease -- was due to loc~ government I ~ spending and how much re- ~l~,on of tax ~ s~ted &om cuts ~ state ~d or payments among ~ o~er factors, jur sd ct ons. ~ The req~ement, however, II ~~g~_ .. was removed q~edy ~is ye~ "T~s wo~d have been ~e ~ I~~~ year" for that kind of detail, C~ison s~d. me and place where hear ngs on 2004 proposed k [ ~ffi ~ ~ I .; .... But Ron Abrms, R-M~ne- ~ili ~e-~l~:-' . ~ ~ ~ mom ~mormm~on: prope~ taxes will be held to~a, ch~rm~ of ~e M~e- ,~ wnere to call for more sota House T~ Committee, information about your I fore each fall's general election. More citizens need to get in- volved in the tax debate, said Rep. Paul Marquart, DFL-Dil- worth. His initiative to move proposed tax bill. and a host of background play- ers, from Carlson to Lynn Reed, executive director of the Min- nesota Taxpayers Association, said there was a logical reason for the move: Counties always had trouble with the calcula- tions. zenry. Its Troth in Taxation notice will include a link to a Web page answering key property- tax questions, said Chris Samu- Source: Minnesota Taxpayers Association Next year a state legislator plans to renew his push for leg- islation requiting the tax-warn- ing notices to be delivered be- -- Market value of the property for the previous and current tax years. It is too late to challenge these values, which are determined by the county assessor and used to calculate the proposed tax bill. up the tax-notice calendar did not survive House-Senate ne- gotiations this year. For Ramsey County, the fo- cus now is to educate the citi- el, manager of local govern- ment policy and research. The site's not up yet, but the questions have a familiar ring. "Why are notices sent out $ 1,212.60 6t8,00 Proposed tax and previous year tax 'for all local governments, plus a calculation of the percent change for the property's total proposed tax compared to last year. What's missing? Until this year, statements also included two middle columns seeking to show how much of any tax increase or decrease was due to changes in local- government spending and how much was due to changes in the propero/s market value, changes in state aid and other factors. The state Legislature voted this year to no longer require that information. Mark Boswell/Star Tribune after elections?" says one. "What happened to the two columns?" reads another. To read the Industrial and OjJgt. e Properties group flier online, go to http://unvw, naiopmn, org/ Anthony Lonetree is at alonetree@startribune, com. City of Elk River Newsletter Volume 13. No. 6 November 2003 River The C trretzt City CounciI/EDA/HRA Meetings Moved to Senior High School's Little Theatre As of October 20, 2003, the City Council, Economic Development Authority, and Housing and Redevelopment Authority meetings are being held in the Little Theatre at the Elk River Senior High School located at 900 School Street. The public can access the Little Theatre through Gate H in the back of the high school. (All doors to the school will be open but Gate H is the clos- est entrance to the Theatre.) The meetings were moved due to the improved acoustics and seating in the Theatre. The Planning Commission and Park and Recreation Commission meetings are still being held at Lions Park Center located at 1104 Lions Park Drive. All board and commis- sion meetings are open to the public. When City Hall construction is completed next spring all these meet- ings will be moved back to the Council Chambers located in City Hall.. BUDGET DISCUSSIONS CONTINUE Truth in Taxation Hearing Scheduled for December 8 The City Council has set the maximum tax levy for 2004 and is still working on balancing the General Fund budget. Public input will be requested at the city's Truth in Taxation hearing that will be held December 8 at 6:30 p.m. at the Elk River High School Little Theatre. The maximum levy was set at $6,564,803. This includes levying back 60 percent of the city's 2004 Local Government Aid loss of $644,149. The 2004 levy as pro- posed will increase $584,642 or 9.78 percent. However, based on current property value data from Sherburne County, the tax rate is projected to decrease from 44.613 percent in 2003 to 43.731 percent in 2004. This means if your market value stayed the same, the city share of your property tax bill would decrease. Budget continued on page 3. City Responds to Concerns Regarding Downtown Revitalization Project At the August 25, 2003, Housing and Redevelopment Authority (HRA) meeting, city staff provided responses to fif- teen questions and issues raised at the July 18, 2003 HRA meeting. The majori- ty of the questions and issues raised were related to traffic and parking dur- ing and after construction (details can be found in the staff memo to the HRA dated August 25, 2003). The city recognizes th/~t since many of the business- es rely on public parking, adequate and well located parking spaces are key ingredients to the contin- ued vitality of existing and new businesses in our downtown. The city and MetroPlains will resolve the parking issue and any other design and planning issues before entering a final development agree- ment. In addition, market and financial feasibility Downtown continued on page 5 Budget continued from page I Although it varies depending Upon the value and type of police, fire, and building inspections. General govemment property, the city generally gets approximately 25 percent of the property tax you pay. The balance goes to the school district and the county. As you can see from the chart below, the majority of the tax levy is used to support General Fund activities such as public safety, public works, recreation, and general gov- ernment programs. ~L-k.xfAIUI~i PROPOSED TA:( LEX3.' FOR COLI_~CTION IN 2004 ~ The General Fund accounts for most of the city's day to day operating activity. The 2004 General Fund budget has not been finalized and will not be until after the Truth in Taxation heating has been held. The proposed budget is unbalanced with estimated revenues of $7,619,550 and expenditures of $7,764,950. Most of the General Fund revenue comes from property tax. Other revenues include license and permit fees, fines, recreation fees, aids from the State of Minnesota, and charges for services. Revenues for the proposed 2004 General Fund budget break down as follows: !004 PROPOSED B1/DGET: GENERAL FUND KEVENIJES BY SOURCE 8.60% Pml~rty T~ The most significant change in General Fund revenues in 2004 is the decrease in intergovernmental revenues 'revenue received from other governments, mainly the ;tate of Minnesota). In 2002, before the State significantly :ut Local Government Aid, the city received $1,478,990 in intergovernmental revenues. Intergovernmental revenues were almost 20 percent of the 2002 revenues. But, with only $500,650 projected for 2004, intergovernmental rev- enues will be only 6.5 percent of the 2004 revenues. As in past years, most of the General Fund expenditures are for public safety services and programs including services including cable TV, elections, legal, planning, finance, information technology, and general administra- tion account for approximately 25 percent of the fund's expenditures. Public works departments included in the General Fund are general street maintenance, snow removal, and engineering. Culture and recreation is made up of park maintenance, recreation, and senior citizen pro- grams. 2004 PROPOSED BUDGET: GENEtC~L FU1NI) EX.q~ENI)ITURES BY PROGRAI),i PO,lie 47 and Rec~eaOon 10.60% Most of the capital outlay needed to support these activi- ties is not included in the General Fund; therefore, person- al services account for the largest share of expenditures by category in the General Fund. Since most of the programs provided are service related, such as police protection, employees are the most significant and important resource. The General Fund has a total of 87.1 full time equivalent employees excluding seasonal employees, part time fire fighters and police reserves. 2004 PROPOSED BUDGET: GENER.~L F[TND EXPENDITI. qRES BY CATEGORY Finally, the city also approves budgets for the Library, Ice Arena, Economic Development Authority, Housing and Redevelopment Authority, Capital Outlay Reserve, Wastewater Treatment Plant, Liquor Store, Garbage Collection, and several other funds. These budgets will be discussed and approved by the Council before the end of the year.