The URL can be used to link to this page

4.0. SR 09-07-1999 rll --'\) ( ); !YI{ River ITEM #4. MEMORANDUM TO: Mayor & City Council FROM: Pat Klaers, City Administrator DATE: September 1, 1999 SUBJECT: 2000 Budget The third City Council worksession on the 2000 budget is scheduled for Tuesday, September 7, 1999, immediately following the Utilities Commission discussion, which begins at 5:00 p.m. in the training room. At the last budget worksession on 8/30/99, direction was received to make some adjustments in the proposed budget. The proposal on 8/30/99 showed revenues in the amount of $5,701,100 and expenditures in the amount of $5,940,400 and a budget gap of $239,300. At the 8/30/99 meeting, the following changes were made: . . Revenues . Revenues . Revenues . Expenditures . Expenditures . Expenditures . Expenditures . Expenditures +$ 7,500...Safe/Sober grant - $ 8,000...No CSO grant +$10,000...Interest income - $13,000...Government Buildings (proposed new maintenance position to be half time status) - $12,000...Street Maintenance (proposed Maintenance I position to be 6 lh months with the other 5lh months assigned to the ice arena) - $28,000...Police (no CSO position being authorized) - $ 6,500...Recreation-Adm. (Community Recreation administration fees decrease) - $ 9,000...Park-Fields (error in calculating other rent expense) The above changes result in a positive impact on the budget gap of $78,000. These changes make the proposed revenues $5,710,600 and the proposed expenditures $5,871,900 with the resulting budget gap being $161,300. (As discussed on 8/30, this budget gap excludes the ice arena budget gap of $64,500.) . 13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 . TDD & Phone: (612) 441-7420. Fax: (612) 441-7425 . . . At the 8/30/99 worksession, the Mayor requested information regarding revenues which are generated by various departments. In response to this request, Finance Director Lori Johnson has taken the 9/7 general fund revenues and put them together in a different order. Please see the attached material from Lori. On 8/30/99, the Mayor also requested some information regarding the year end statement for revenues exceeding expenditures. This information is impossible to accurately put together at this time. Better information will be available in December, prior to the setting of the tax levy, however, the December figure will still be an estimate. Historically the city has added to its year end fund balance because revenues exceeded expenditures. It is expected that there will be more revenues received in 1999 than expenditures in the general fund, and at the end of the year the City Council will be requested to make some decisions regarding these funds. The decisions include approving some end of year expenditure requests, transferring funds to cover some capital expenditures, adding monies into designated reserves, or adding money into the fund balance. I support the auditor's recommendation and past City Council action to improve the fund balance in order to help ensure we retain the recently improved bond rating status. I do not support use of a significant amount of the fund balance (or use of excess revenue over expenditures from the current year) in order to balance the budget. The reason is that this money is a non-reoccurring revenue source and becomes very difficult to replace in future years in addition to this practice hurting the fund balance status. At the 8/30/99 worksession, Councilmember Dietz requested additional information regarding adding tax revenues to the general fund budget in order to balance the 2000 proposal. The request was to add $150,000 of additional tax revenue. This additional tax revenue would eliminate a budget gap. This is in addition to the general fund tax monies identified in the 8/30 proposal which already is $167,650 more than the 1999 budget. This 8/30 (and 9/7) tax amount of $3,161,600 reflects no change in the tax rate of 29.324 assuming that the net tax capacity (NTC) grows by 5 percent. We have recently heard from the County Assessor that this 5 percent growth figure is accurate (excluding increases from decertified TIF districts). Please see the attached material from Finance Director Lori Johnson regarding this requested information. It appears that the impact on the tax rate is small for adding the additional tax revenue. . . . As previously noted in this memo, the changes requested by the City Council at the 8/30/99 meeting result in a new budget gap of $161,300. Additional changes for the City Council to consider include the following: . The attached list regarding small, miscellaneous departmental cuts amounting to $24,750. . Consider eliminating the city contribution to either the Historical Society ($3,000) and/or the Rivers of Hope ($3,000). In effort to balance the budget, the City Council should not forget the concern over the level of its City Council contingency fund. It is suggested that this departmental budget be increased in order to provide some City Council flexibility in making decisions on unforeseen requests. Another revenue source the City Council has not discussed in great detail, but should be considered, is a franchise fee from the gas company to operate in Elk River. This may not be required in 2000 to balance the budget, but it could be a significant help in funding the city capital equipment program. Hopefully this would reduce the city's dependence on equipment certificates in the long run. The City Council should review the attached memo and material regarding the ice arena budget in order to better understand the financial issues facing this operation. Action needed by the City Council on 9/13 includes: . Approval of the EDA tax levy resolution . Approval of HRA tax levy resolution . A motion approving the debt levy changes as presented by the Finance Director . Approval of a resolution authorizing the proposed maximum property tax level for 2000 . Setting the truth in taxation public hearing dates for December and its continuation date Finally, the City Council should set its October public hearing date to consider the tax levy increase resolution as required by the new state law. . . . Almost every year as the City Council gets close to balancing the budget, it directs me to go into departmental budgets and "fine tune" some of the requested expenditures. Typically this results in $20-25,000 in reductions. The following is the list of program reductions: City Council $ 250...office supplies $ 200.. . conference/schools Cable TV $ 200...office supplies Administration $ 200...office supplies $ 100...professional services $ 200.. .conference/schools Finance $ 100...professional services $ 100...conference/schools Economic Development $ 0 Elections $ 100...operating supplies $ 100...conference/schools $ 100...publishing Legal $ 0 Energy City $ 100...conference/schools $ 100...publishing Planning $ 200... professional services $ 100...conference/schools Planning Commission $ 0 Government Buildings $ 200...operating supplies $ 100...equipment repair/maintenance services Contingency $ 0 Building/Zoning $ 300...office supplies $ 300.. .conference/schools Police-Adm. $ 200.. . conference/schools $ 500...equipment repair/maintenance services . Police- Patrol $2000...operating supplies $1000.. .conference/schools $5000...equipm't repair/maintenance services Police- Investigations $ 100...office supplies $ 300.. . conference/schools Police-Liaison $ 400.. .conference/schools Police-Support Services $ 200...operating supplies $ 400.. . conference/schools Police-Building Maint. $ 0 Police Reserves $ 0 Fire-Adm. $1000...supplies $1000.. .conference/schools $ 200...equipm't repair/maintenance services . Fire- Inspections $ 0 Emergency Preparedness $ 0 Street Maintenance $1000...supplies $ 300.. .conference/schools $1000...contractual services Snow Removal $ 400...supplies $ 400...contractual services Equipment Services $ 200...operating supplies $ 200...equipment parts Street Lighting $ 0 Engineering $ 0 Shade Tree $ 300...operating supplies Park Maintenance $ 500...operating supplies . $ 500...other rentals . Parks-Fields $ 300...supplies Parks- Ice Rinks $ 200...other rental Recreation-Adm. $ 0 Adult Recreation $ 0 Youth Recreation $ 700...operating supplies $ 400.. . contractual services Recreation-Youth $1000... personal services Initiatives $2000...contractual services Senior Citizens $ 0 Total $24,750 . . City of Elk River General Fund Revenue History . PROPOSED ACTUAL REVENUE RECEIVED BUDGET BUDGET YTD 7/31 2000 1999 ~ 1998 1997 1996 1995 1994 Taxes Ad Valorem 3,161,600 2,993,950 1,318,216 2,632,140 2,471,703 2,165,086 1,801 ,547 1,526,784 Gravel 45,000 41,000 3,922 51,269 45,766 45,187 39,413 38,949 Total Taxes 3,206,600 3,034,950 1,322,138 2,683,409 2,517,469 2,210,273 1,840,960 1,565,733 License & Pennits Liquor 35,000 35,000 34,200 37,324 34,805 25,873 24,490 24,590 Amusement 2,250 2,250 105 3,430 2,400 2,330 2,660 1,855 Cigarette 2,500 2,500 (100) 2,595 725 600 550 525 Apartment 11 ,850 11,850 9,000 15,696 11 ,904 Gas Fitters 1,800 1,800 1,344 2,736 2,448 2,712 1,848 1,872 Mining 10,800 10,800 12,547 12,160 11,762 12,330 10,081 8,602 Garbage Hauler 750 750 570 1,140 1,755 210 780 570 Other Business 7,000 7,000 7,150 7,165 8,044 11 ,295 4,055 4,910 BUilding Permit 339,200 223,500 236,117 376,909 342,248 315,407 190,054 163,075 Plumbing/Heating Permit 63,250 52,000 41,497 70,302 63,885 55,393 45,876 31,977 Permit Surcharge 800 800 1,855 1,035 866 1,729 255 867 Electric Permit 143 365 Animal License 1,900 1,900 1,829 1,828 2,182 2,119 797 1,095 Parking Permit 324 324 1,283 660 348 337 Other Non Business 1,000 1,000 3,290 7,817 8,014 8,344 5,652 3,744 Total Licenses & Permits 478,100 351,150 349,871 540,826 492,321 439,002 287,446 244,019 Intergovernmental Revenue COPS Grant 71,450 80,150 48,670 124,340 105,159 41,412 13,952 other Federal Grants .GA 277,000 198,150 99,094 241,573 227,640 223,004 247,123 242,240 ACA 495,850 495,850 247,931 508,880 500,385 493,416 496,617 528,851 PA 17,750 8,880 18,581 14,980 PERA Aid 11 ,500 11 ,500 9,187 18,373 5,757 Police Aid 114,900 108,900 119,141 98,276 114,416 91,700 81,791 Police Training Reimb. 7,500 7,500 6,646 6,360 5,481 5,843 5,583 State Aid Street Maint. 28,000 28,000 29,716 29,341 27,391 26,611 30,372 27,270 State Crive Prevention Grant 23,000 10,294 34,253 3,670 Other State Grants 7,500 17 ,000 1,000 8,469 1,000 Other Local Grants 8,909 6,421 7,600 15,190 Totallntgvtl. Revenue 1,013,700 987,800 454,772 1,118,506 996,039 911 ,940 901 ,797 885,735 Charges for Services Admin. Project Fees 50,000 50,000 37,740 16,962 60,885 68,500 48,832 Planning & Zoning Fees 17,500 17,500 14,590 19,310 25,650 19,610 14,500 21 ,540 Plan Check Fees 201 ,650 127,750 140,122 223,632 201 ,254 125,009 112,765 100,101 Special Assmt. Search 5,000 5,000 1,740 8,775 4,935 6,255 5,805 6,285 Sale of Maps/Copies 1,500 2,500 1,292 2,670 8,041 7,025 2,774 1,530 Reimb. For Police Services 7,000 7,000 9,649 14,671 11,698 12,144 14,295 25,248 School Liaison 43,000 70,000 65,000 60,000 69,076 75,678 49,736 48,277 Aminal Impound 2,300 2,300 1,920 2,967 3,102 1,623 1,951 1,670 Vehicle Impound 467 565 580 360 Fire Contracts 70,000 70,000 78,166 63,848 89,514 86,680 52,888 60,332 Fire Calls 6,000 6,000 6,263 8,650 7,795 13,712 5,250 6,825 Street Services 3,000 3,000 1,789 16,167 10,101 3,597 4,314 2,292 Recreation Fees 69,250 69,250 500 54,859 58,628 47,262 48,950 40,806 Softball League Fees 6,912 9,148 9,204 Sewer Inspection Fee 1,000 1,000 540 2,940 2,640 1,740 1,680 2,070 Contractor License Check 5,200 5,200 755 Total Charges for Service 482,400 436,500 322,793 516,794 509,976 468,132 392,916 375,012 . Finance Dept 912199:Revsum Page 1 City of Elk River General Fund Revenue History . PROPOSED ACTUAL REVENUE RECEIVED BUDGET BUDGET YTD 7/31 2QQQ ~ 1999 1998 1997 1996 1995 1994 Fines Court 110,700 90,000 56,414 110,713 84,221 80,028 73,058 76,370 Parking 5,000 5,000 4,360 5,040 Total Fines 115,700 95,000 60,n4 115,753 84,221 80,028 73,058 76,370 other Revenue Interest Income 80,000 60,000 39,256 119,115 92,931 69,517 63,516 46,221 Vending Machines (Emp.) 640 1,9n Solid Waste Surcharge 9,000 9,000 19,014 9,000 11,200 10,000 10,000 16,518 Refunds & Reimb. 5,550 3,528 11,086 9,300 1,732 6,018 3,209 Contributions 3,700 3,700 3,700 3,700 3,700 3,700 3,700 3,700 Miscellaneous 1,883 2,213 4,204 10,992 1,480 388 Total other Revenue 92,700 78,250 68,021 147,091 121,335 95,941 84,714 70,036 Transfers In Landfill 19,750 19,750 19,750 19,750 19,750 20,950 20,950 Capital Outlay Reserve 20,000 37,150 43,050 21,719 15,500 70,950 72,000 Street Reserve 45,000 45,000 25,000 25,000 NSP/RDF Reserve 19,750 19,750 19,750 19,750 19,750 19,750 19,750 Development Fund 3,900 22,150 WWTS 10,000 8,000 8,000 6,000 6,000 6,000 6,000 Liquor 110,000 110,000 123,450 123,450 133,450 153,450 113,450 ERMU 90,000 90,000 60,000 78,000 78,000 72,000 72,000 72,000 EDA 2,000 2,000 2,000 1,000 1,000 1,000 1,000 HRA 1,000 1,000 1,000 500 500 500 500 Other 917 867 I Transfers In 321,400 354,800 60,000 295,000 270,169 267,950 370,517 331,517 OTAL GENERAL FUND 5,710,600 5,338,450 2,638,369 5,417,379 4,991 ,530 4,473,266 3,951,408 3,548,422 USE OF FUND BALANCE 25,000 TOTAL BUDGET 5,710,600 5,363,450 . Finance Dept 912199:Revsum Page 2 SEPTEMBER 7,1999 REVISED 2000 BUDGET . 2000 PROPOSED Personal Other Svcs. . Capital Services Supplies & Charges Outlay Total General Government City Council 34,600 3,750 50,000 88,350 Cable TV 16,700 3,600 3,900 24,200 Administration 254,600 8,000 39,250 10,650 312,500 Finance 239,600 4,000 52,050 3,500 299,150 Economic Development 46,350 46,350 Elections 18,000 8,000 4,000 30,000 Legal 72,600 72,600 Energy City 18,500 2,000 20,500 Planning 203,000 3,100 24,700 230,800 Planning Commission 1,500 5,900 7,400 Govemment Buildings 38,650 7,500 42,900 89,050 Council Contingency 106,650 106,650 Total General Government 871,500 37,950 403,950 14,150 1,327,550 Public Safety Building/Zoning 403,150 12,900 24,500 7,600 448,150 Police .ministratiOn 222,550 12,450 105,400 10,600 351,000 trol 1,048,400 72,750 38,350 1,159,500 Investigations 188,700 8,100 4,400 2,050 203,250 DARE 150,300 1,050 3,100 154,450 Support Services 258,100 8,550 9,700 276,350 Building Maintenance 2,000 14,150 16,150 Total Police 1,868,050 104,900 175,100 12,650 2, 160,700 Police Reserves 10,850 8,900 4,900 4,500 29,150 Fire Fire Fighting/Administration 184,900 30,550 53,950 269,400 Fire Inspections 57,250 1,350 1,850 60,450 Total Fire 242, 150 31,900 55,800 329,850 Emergency Preparedness 7,800 2,050 6,000 15,850 Total Public Safety 2,532,000 160,650 266,300 24,750 2,983,700 Public Works Streets 351,050 79,500 149,350 579,900 Snow Removal 119,550 28,000 14,000 161,550 Equipment Repair 95,850 57,500 3,500 156,850 Street Lighting Engineering 42,000 42,000 Total Public Works 566,450 165,000 208,850 940,300 . 9/3/99 SEPTEMBER 7, 1999 REVISED 2000 BUDGET . 2000 PROPOSED Personal Other Svcs. Capital Services Supplies & Charges. Outlay Total Culture and Recreation Shade Tree 1,250 5,000 2,000 8,250 Parks Grounds/Facility Maintenance 91,000 32,000 36,450 10,650 170,100 Athletic Fields 32,150 7,600 6,000 45,750 Ice Rinks 11,300 500 4,000 15,800 Total Parks 134,450 40,100 46,450 10,650 231,650 Recreation Administration 10,800 71,500 82,300 Adult Recreation 2,700 10,000 12,700 Youth Recreation 40,450 13,000 29,500 82,950 Youth Initiatives 29,100 1,000 22,550 52,650 Total Recreation 83,050 14,000 133,550 230,600 Sr. Citizen Programs 54,300 1,000 6,950 62,250 Total Recreation 273,050 60,100 188,950 10,650 532,750 Transfers Out Capital Outlay Reserve 21,000 21,000 City Hall Debt Service 66,000 66,600 Total Transfers Out 87,000 87,600 aL GENERAL FUND 4,243,000 423,700 1,068,050 136,550 5,871,900 . 9/3/99 2000 CAPITAL OUTLAY . Funding Source General Equipment Equipment Department . Department Item Fund Certificate Reserve Total Mayor & Council 0 Administration CODY Machine 10,650 10,650 Finance Check Sianer 3,500 3,500 Elections 0 Planning 0 Building & Envior. CODY Machine 2,600 Truck 20,000 Remodel Office 5,000 27,600 Govt. Building City Hall Buildina Debt 66,600 66,600 Police Sauad Cars (5) & Setup/Striping 136,200 CODV Machine 8,400 Cameras 4,250 148,850 Police Reserve Portable Radios 4,500 4,500 Fire *Pumper Davment 13,000 43,000 SCBAs 20,000 76,000 Emergency Prep. Siren 13,000 13,000 Streets Mower 8,000 Tractor 26,600 Planer 2,650 *DumD Truck 136,200 173,450 Parks 0 Recreation Ice Arena Reserve (Transfer to Reserve) 8,000 8,000 Ice Arena Equipment 3,500 3,500 $137,150 $215,800 $182,700 $535,650 *ERMU Reserve . 9/3/99 PROPERTY TAX IMPACT OF SAMPLE PAY 2000 LEVIES . Sample 1 - Homestead Residential Property with Market Value of $120,000 City . $ Change % Change Tax Rate City Tax from 1999 from 1999 Taxes Payable 2000 8/30 proposal Add $150,000 - 9/2 NTC Taxes Payable 1999 Taxes Payable 1998 NTC 1,486 1,486 1,486 1,515 1,583 29.324% 30.193% 29.324% 26.255% 435.75 448.67 444.26 415.62 (8.50) 4.41 -1.91% 0.99% Sample 2 - Homestead Residential Property with Market Value of $160,000 City $ Change % Change Tax Rate City Tax from 1999 from 1999 Taxes Payable 2000 8/30 proposal Add $150,000 - 9/2 NTC Taxes Payable 1999 Taxes Payable 1998 NTC 2,146 2,146 2,146 2,195 2,323 29.324% 30.193% 29.324% 26.255% 629.29 647.94 643.66 609.90 (14.37) 4.28 -2.23% 0.66% Sample 3 - Homestead Residential Property with Market Value of $200,000 City $ Change % Change Tax Rate City Tax from 1999 from 1999 . Taxes Payable 2000 8/30 proposal Add $150,000 - 9/2 NTC Taxes Payable 1999 Taxes Payable 1998 NTC 2,806 2,806 2,806 2,875 3,063 29.324% 30.193% 29.324% 26.255% 822.83 847.22 843.07 804.19 (20.23) 4.15 -2.40% 0.49% Sample 4 - Commercialllndustrial Property with Market Value of $150,000 City $ Change % Change Tax Rate City Tax from 1999 from 1999 Taxes Payable 2000 8/30 proposal Add $150,000 - 9/2 NTC Taxes Payable 1999 Taxes Payable 1998 . 9/2199 Taxlevy NTC 3,600 3,600 3,600 3,675 4,050 29.324% 30.193% 29.324% 26.255% 1,055.66 1,086.95 1,077.66 1,063.33 (21.99) 9.29 -2.04% 0.86% .. . . . PROPERTY TAX IMPACT OF SAMPLE PAY 2000 LEVIES Sample 5 - CommerciallIndustrial Property with Market Value of $300,000 City $ Change % Change Tax Rate Citv Tax from 1999 from 1999 Taxes Payable 2000 8/30 proposal Add $150,000 . 9/2 NTC Taxes Payable 1999 Taxes Payable 1998 NTC 8,700 8,700 8,700 8,925 10,050 29.324% 30.193% 29.324% 26.255% 2,551.19 2,626.79 2,617.17 2,638.63 (65.98) 9.62 .2.52% 0.37% Sample 6 - CommerciallIndustrial Property with Market Value of $1,000,000 City $ Change % Change Tax Rate Citv Tax from 1999 from 1999 Taxes Payable 2000 8/30 proposal Add $150,000 . 9/2 NTC Taxes Payable 1999 Taxes Payable 1998 NTC 32,500 32,500 32,500 33,425 38,050 29.324% 30.193% 29.324% 26.255% 9,530.30 9,812.73 9,801.55 9,990.03 (271.25) 11.18 -2.77% 0.11% Taxes Payable 2000 Tax Rate Notes: 8/30 Proposal assumes 5% growth in NTC and Tax Rate of 29.324%. The next proposal provides an increase of $150,000 added to the 8/30 proposed tax levy. Net Tax Capacity (NTC) Growth Notes: The NTC used to calculate the above tax rates was the estimate provided by the County Assessor on September 2, 1999. Estimated pay 2000 NTC is 13,233,442. This includes the addition of TIF NTC totaling approximately 120,000. Tax Levy Notes: Taxes Payable 1999 Taxes Payable 2000 . July 26 Proposal Taxes Payable 2000 . Aug. 30 Proposal Taxes Payable 2000. Aug. 30 Proposal + $150,000 Net Levy General Fund Levy $3,629,214 $2,993,938 $3,977,911 $3,293,950 $3,845,583 $3,161,622 $3,995,583 $3,311,622 Please Note: These samples include City of Elk River tax only. Due to the Homestead Education Credit, the total tax due for many residential homestead properties has decreased in the past two years. The maximum education credit and percentage increased again for taxes payable 2000. The Legislature created this new credit to offset the shift in tax burden from higher value houses and commercial/industrial property to primarily lower to moderate value houses. Because the county, school district, and homestead educational credit rates are not yet available, it is not possible to estimate the total tax due on a given parcel 9/2199 Taxlevy City of Elk River Revenue Sources by Activity . PROPOSED RELATED. BUDGET BUDGET REVENUE DEPARTMENTlS) 2000 1999 Liquor Administration 35,000 35,000 Amusement Administration 2,250 2,250 Cigarette Administration 2,500 2,500 Sale of Maps/Copies Administration 1,500 2,500 41,250 42,250 Special Assmt. Search Finance 5,000 5,000 Interest Income Finance 80,000 60,000 85,000 65,000 Admin. Project Fees Admin/Finance 50,000 50,000 50,000 50,000 Planning & Zoning Fees Planning 17,500 17,500 17,500 17,500 Apartment Building & Zoning 11,850 11,850 Gas Fitters Building & Zoning 1,800 1,800 Building Permit Building & Zoning 339,200 223,500 Plumbing/Heating Permit Building & Zoning 63,250 52,000 Permit Surcharge Building & Zoning 800 800 Sewer Inspection Fee Building & Zoning 1,000 1,000 Plan Check Fees Building & Zoning 201,650 127,750 . Contractor License Check Building & Zoning 5,200 5,200 624,750 423,900 Animal License Police 1,900 1,900 COPS Grant Police 71,450 80,150 Police Aid Police 114,900 108,900 Police Training Reimb. Police 7,500 7,500 State Crime Prevention Grant Police 23,000 Reimb. For Police Services Police 7,000 7,000 School Liaison Police 43,000 70,000 Aminal Impound Police 2,300 2,300 Court Fines Police 110,700 90,000 Parking Fines Police 5,000 5,000 363,750 395,750 Fire Contracts Fire 70,000 70,000 Fire Calls Fire 6,000 6,000 76,000 76,000 State Aid Street Maint. Streets 28,000 28,000 Street Services Streets 3,000 3,000 31,000 31,000 Recreation Fees Recreation 69,250 69,250 69,250 69,250 Ad Valorem Tax General 3,161,600 2,993,950 Gravel Tax General 45,000 41,000 Mining Permit General 10,800 10,800 Garbage Hauler License General 750 750 . Other Business Licenses General 7,000 7,000 Other Non Bus. Licenses General 1,000 1,000 Finance Dept. 913199: Revsum Page 1 . Finance Dept. 9/3/99: Revsum Notes: The department(s) identified with the above revenue sources is (are) the department(s) most directly related to the revenue source. Other departments are often indirectly related to the revenue generated. For example, building and planning department revenues are related since building activity is dependent upon plats approved by the planning department. Page 2 rei ---'\) ( )j ~l}{ MEMORANDUM TO: Mayor & City Council River DATE: Pat Klaers, City A~ator September 2, 1999 FROM: SUBJECT: 2000 Ice Arena Budget Attached for your review are the ice arena budget worksheets which include the 1998 results, the 1999 budget, the current status, and the 2000 proposal. The 1998 budget needs to be adjusted slightly in order to get a true picture of expenditures and revenues due to the capital expenditure for the dehumidification, and due to the City Council action to transfer in funds in order to payoff the outstanding debt in the ice arena fund. When looking at the adjusted 1998 results, it is apparent that the 1999 budget is not accurate. Accordingly, the 2000 proposal closely mirrors the 1998 final figures. . The ice arena budget is projected to have a shortfall between available revenues and planned expenditures in the amount of $64,500. We hope the shortage will be less due to revenues exceeding the projection and expenditures coming in lower than expected. This 2000 estimate is better than the actual 1998 shortage (without capital outlays or transfers) of $78,182. We are going in the right direction, but it is going slowly. Operating revenues exceed operating expenditures, but not by enough to cover the annual bond payments. A revenue problem is that there is only so much ice time to be rented out and, in order to substantially change the ice rental revenue figures, we need to develop summer hockey leagues. An issue with the ice arena budget relates to the expectations that were set forth with the Marquette Study. The Marquette Study indicated that in 1997, ice rental revenues would be $364,715. The most realistic projection that we have is that ice rental revenues in the year 2000 will only be at $324,650. This is a substantial difference between reality and expectations. The other false expectations had to do with personal services. The Marquette Study indicated that in 1997 personal services would be in the $84,400 range. Adding a 3 percent inflation factor to this amount means that personal services would be about $96,600 in the year 2000. The 2000 budget proposal shows personal services at $135,300. Again, this is a substantial difference between expectations and reality. The difference between these two expectations is essentially the shortage we are experiencing in our budget for 2000. . Our youth athletic programs receive assistance from the city for the development of facilities and for operating expenses. Annually there are funds in the budget to help with the maintenance of youth baseball, girls youth softball, and youth soccer fields, the softball complex, and ski trails. However, there has been a concern about the city assisting with indoor skating activities. At this time the city must address a $64,500 budget shortage for 2000. 13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · TDD & Phone: (612) 441-7420 · Fax: (612) 441-7425 BUDGET WORKSHEET Date: 08/20/99 (/ Time: 3:19pm ity of En River Jqql.) Page: 3 -------------------------------------------------------------------------------------------------------------------------------------------------------- Prior ----------------- Current Year ---------------------- Year Original Amended Actual Theu Estimated ~~:~.....=~~~~::.--:---r'-----------------~~:~~=------------~~~:~:---------~~~~:-----:~~----------------:~:~-~~:~~~:~~------~~~~~~~~----~~~~:~~------- Fund~.IIbNA V Revenues HGS CHARGES FOR SERVICES 461 Recreation Fees 31,227 0 29,812 55,000 55,000 464 Ice Rental 268,936 465 Admissions 28,058 466 Dry Floor Events 12,915 467 Concessions 21,000 468 Skate Sharpening 6,341 482 Sign Rental 12,205 CHARGES FOR SERVICES 380,682 REV OTHER REVENUE 621 Interest Income 622 Vending Machines 30,035 625 Refunds , Reimbursements C~:~~,~~ 626 Contributions .629 Miscellaneous Revenue 8,055 910 Sale of Fixed Assets .R REVENUE RIN . ERS IN 921 Operating Transfer 58,440 ---.."._~~' ~~. TRANSFERS IN 233,229 6~al Re~ Expendi tures Dept: 540.540 ICE ARENA S PERSONAL SERVICES : 101 Regular Pay 337,600 28,500 10,000 21,500 5,000 9,000 411,600 24,000 2,000 26,000 337,600 28,500 10,000 21,500 5,000 9,000 411,600 24,000 2,000 26,000 127,842 300,000 269,500 30,000 11,500 21,500 6,500 11,000 405,000 24,500 2,200 26,700 ---~=~.~------------ -------------- -------------- -------------- -------------- ---~. ------------- ~L151/) 437,600 437,600 233,295 462,200 ~ ~ tf/B,117 loB, ~~t~:~ ::::::=~111 ::=::::~~~ ::::::-:~;~ ::-== ::~~~ ::::::::~~1l~ i::::~~~ /~ 4,021 5,500 5,500 2,373 3,800 3,800 '102 Overtime Pay 103 Part-time Pay ,104 PERA : 105 FICA 6,695 :107 Medicare 1,566 :108 Insurance 5,614 : 109 Woders Comp 1,177 : 110 Re-employment Compensation 6,650 1,550 7,400 1,650 83 6,650 1,550 7,400 1,650 21,871 30,000 7,000 1,650 6,400 1,100 PERSONAL SERVICES -------~;;~;~~ -7--~;;~~~~ -------~;;~~~~ --------;;~;~~ -------------- -------~;;~;~~ -------~;~~~~~ -;:;r------- jUPP SUPPLIES 1212.U Is , Lubs ;217 rm Allowance 660 199 1219 Operating Supplies 16,797 1223 Bldg Maint Supplies 3,922 3,550 350 10,400 4,550 3,550 350 10,400 4,550 11,683 11,500 10,750 21,500 2,997 6,500 1,638 11,000 206,593 435,500 926 14,892 24,500 884 2,200 10,000 26,702 26,700 4,057 7,000 949 1,650 3,045 6,400 695 1,100 331 647 1,200 350 6,168 11,000 1,144 6,200 1,200 350 11,11.00 5,950 Ci ty of Elk River BUDGET WORKSHEET Date: 08/20/99 Time: 3:19pm Page: 4 -------------------------------------------------------------------------------------------------------------------------------------------------------------- Prior ----------------- Current Year ---------------------- Year Original Amended Actual Thru Estimated ~;:.~:~~~:~~~------------------------~:~~~:_-----------~~~:~~---------~~~:~~----_:~::_--------------_:~~~:_~~:~~~~~~------~~:~~~~~~~----~~~:~~~------- Expendi tures Dept: 540.540 ICE ARENA SUPP SUPPLIES 4255 Soft Drinks/Mise 16,470 13,000 13,000 6,409 13,250 13,250 4259 Other Merchandise For Resale 1,012 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- 750 650 650 294 750 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- SUPPLIES -------------- --7---------- -------------- -------------- -------------- -------------- -------------- -------------- 39,060 V 32,500 32,500 14,662 32,750 32,500 V' OSC OTHER SERVICES , CHARGES 4319 Other Professional Services 11,669 5,100 5,100 525 5,200 5,200 4321 Telephone 2,189 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- 2,350 4322 Postage 635 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- 1,650 4331 Travel, Conferences' Schools 642 4359 Publishing 1,334 4361 Insurance 3,548 4Jt9 Utilities 83, 423 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- (j,000 4401 B1dg Repair /Maint Services 15, 611 1,400 600 1,650 1,300 6,000 74,850 7,700 1,400 1,177 2,350 750 1,500 7,200 90, 606 4404 Equip Repair /Haint Services 8,266 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- 8,400 12,750 600 916 750 4405 Cleaning Services 847 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- 900 800 1,650 246 1,650 -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- 4409 Contractual Services 2,082 441.pment Rental 4433 s' Subscriptions 2,108 244 4440 Miscellaneous 2,650 1,550 400 1,300 600 1,500 2,200 3,450 400 OTHER SERVICES , CHARGES -------------- ---7--------- -------------- -------------- -------------- -------------- -------------- ------::-------- 132,658"/ 116,750 116,750 65,573 130,600 130,600 V' CAP CAPITAL OUTLAY 4560 Equipment CI2~~.4.47-> CAPITAL OUTLAY 120,447 TROU TRANSFERS OUT 4730 Transfer-Debt Service 197,420 TRANSFERS OUT 197,420 I CE ARENA 617,401 ~~ 1,800 1,800 197,850 197,850 478,400 6,000 4,636 7,200 198,050 198,050 496,200 -------------- -------------- -------------- -------------- -------------- -------------- ----------~----------- I 617,401 478,400 478,400 153,041 499,350 ~200 _ c rea/ :/ ~qt, CJio .-' ~------- ---~ ------------__ _u___n______ nn__________ ____n__n__u _____n___n__ ______n_.,=:"';~----------- 54,950 -40,800 -40,800 80,254 -37,150 C -64~ I CE ARENA 74,850 48,099 90,600 7,700 2,409 6,000 12,750 1,978 8,400 800 472 900 2,650 2,629 2,200 1,550 1,788 3,450 400 98 400 1,800 5,100 1,800 5,100 197,850 198,050 197,850 198,050 478,400 153,041 499,350 1119 a)j.,J~.. .o.::..r:r'~ ~oo J.:,.: ! ACt)&' ~~fr ~ . * + t ~ Clv "" ',<- AeA ,_ i,l i Ci<:<>ti 0'" t v' ~ '," ~ t ~ 1/ O~1~h.tJlI~' I-tl~ .. .{O P'l . a . . . . RESOLUTION 99 - A RESOLUTION FOR THE CITY OF ELK RIVER A RESOLUTION AUTHORIZING THE 1999 PROPOSED PROPERTY TAX LEVY FOR COLLECTION IN 2000 WHEREAS, the Elk River City Council has review the City's anticipated expenditures for all funds in 2000; and, WHEREAS, the Elk River City Council has considered projected revenues for all funds in 2000; and, WHEREAS, revenues from sources other than property taxes are not sufficient to meet anticipated expenditures of all funds. 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 2000: General Fund Lake Orono Library Dam Loan Development Fund Surface Water Management City Special Assessments 1989 Fire Equipment 1994 Storm Sewer Bonds 2000 Certificate of Indebtedness 1999 Certificate of Indebtedness 1998 Certificate of Indebtedness 1997 Certificate of Indebtedness 1996 Certificate of Indebtedness TOTAL Gross Levy $ 3,809,355 100,000 66,650 32,572 145,000 57,500 28,926 72,891 116,073 57,500 40,000 23,150 25,283 21,794 $ 4,596,694 HACA Reduction $ 498,244 13,080 8,717 4,260 18,965 7,521 3,783 9,534 15,182 7,521 2,851 3,307 3,028 5,232 $ 601,225 Net Levy $3,311,111 86,920 57,933 28,312 126,035 49,979 25,143 63,357 100,891 49,979 37,149 19,843 22,255 16,562 $3,995,469 Passed and adopted by the City Council of the City of Elk River this 13th day of September, 1999. ATTEST: Sandra A. Peine, City Clerk Stephanie Klinzing, Mayor / . . . Appendix J Sample resolution authorizingoa tax rate increase Resolution Noo_ Resolution Authorizing a Tax Rate Increase for the 1999 Tax Levy, Collectible in 2000 Be it resolved by the council of the City of _' County of . Minnesota, that the county auditor is authorized to fix a property tax rate for taxes payable in the year 2000 that is higher than the tax rate calculated pursuant to Minnesota Statutes ~ 204B.135 for the city for taxes levied in 1998, collectible in 1999. " Adoption of this resolution does not prohibit the city from certifying a fmallevy that will result in no tax rate increase or a tax rate decrease. The city clerk is hereby instructed to transmit a cenified copy of this resolution to the county auditor of County, Minnesota. Adopted by the city council on Mayor Attese City Clerk J ( 116 League of MiMcsota Cities 2'd 53111J NW jO 3n~~3l Wd9S:20 55, L0 d35