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10.2 SR 11-07-2022 Request for Action To Item Number Mayor and City Council 10.2 Agenda Section Meeting Date Prepared by Work Session November 7, 2022 Lori Ziemer, Finance Director Item Description Reviewed by 2023 Budget Cal Portner, City Administrator Reviewed by Action Requested Continue 2023 budget discussion Background/Discussion On September 6, the Council approved a maximum levy of $15,202,106, with a preliminary General Fund Budget of $20,552,150. Since then, additional adjustments of $107,150 have been made to bring the proposed levy to $15,094,956 with an estimated tax rate of 39.618%, compared to 43.967% in 2022. The levy adjustments consist of General Fund revenue increases of $45,000 and expenditure reductions of $62,150. Expenditure adjustments resulting from decreases in supplies and fuel costs reduce the General Fund budget to $20,490,000, or an 8.3% increase over 2022. The General Fund budget consists of the same level of services as 2022 and the budget increase is mainly impacted by inflationary increases and costs associated with the newly added park amenities and city facilities. Financial Impact N/A Mission/Policy/Goal The city’s mission is to grow responsibly and be good stewards for every dollar. Attachments  General Fund Budget  Proposed Tax Levy  Tax Impact The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity. Updated: August 2020 CITYOFELKRIVER 2023PROPOSEDBUDGET GENERALFUND 20192020202120222023%ofIncrease/% LACTUALACTUALBUDGETPROPOSEDBudget(Decrease)Change ACTUA GeneralFundRevenues: Propertytaxes$11,171,84811,934,049$12,297,572$13,109,300$13,893,00067.8%$783,7006.0% Othertaxes158,232193,275233,745180,000225,0001.1%45,00025.0% Licenses&Permits822,899665,5191,015,529865,7001,004,3004.9%138,60016.0% IntergovernmentalRevenues607,320607,367581,927623,000634,0003.1%11,0001.8% ChargesforServices923,063779,9641,035,9531,018,0001,127,2005.5%109,20010.7% Fines134,49389,359127,266120,000130,0000.6%10,0008.3% OtherRevenues495,889278,453297,915260,000275,0001.3%15,0005.8% TransfersIn1,922,6572,613,9432,281,9602,737,6503,201,50015.6%463,85016.9% TotalGeneralFundRevenues16,236,40117,161,92917,871,86718,913,65020,490,000100.0%$1,576,3508.3% GeneralFundExpenditures GeneralGovernment: Mayor&Council142,390141,884161,522189,250203,7501.0%14,5007.7% Communications274,801282,556334,651412,750451,5502.2%38,8009.4% AdministrativeServices540,930566,052597,464618,500677,5003.3%59,0009.5% HumanResources281,080300,387344,469376,600402,5002.0%25,9006.9% Elections6,30073,5616,30048,7006,6000.0%(42,100)86.4% Finance632,392597,788620,548686,150717,9503.5%31,8004.6% InformationTechnology419,605501,899454,648542,550614,4503.0%71,90013.3% Legal315,866232,017244,402255,000275,0001.3%20,0007.8% CommunityDev/Planning495,545554,689578,245601,600486,2502.4%(115,350)19.2% FacilitiesMaintenance711,842755,149812,257931,2501,029,5505.0%98,30010.6% EnergyCity29,57322,30723,92238,70048,0000.2%9,30024.0% TotalGeneralGovernment3,850,3244,028,2894,178,4284,701,0504,913,10024.0%212,0504.5% PublicSafety: Police5,647,8225,734,6956,338,2126,788,6007,418,35036.2%629,7509.3% Fire1,289,6961,243,6091,514,7521,611,2001,842,7009.0%231,50014.4% BuildingSafety514,626498,824489,072548,650583,6002.8%34,9506.4% CodeEnforcement91,45880,36086,31694,200117,5000.6%23,30024.7% Environmental32,47754,75957,57862,50099,6500.5%37,15059.4% TotalPublicSafety7,576,0797,612,2478,485,9309,105,15010,061,80049.1%956,65010.5% PublicWorks: StreetMaintenance1,323,2791,411,9361,472,0801,429,5001,567,0007.6%137,5009.6% SnowRemoval334,574284,921336,707338,000360,0001.8%22,0006.5% EquipmentServices232,155221,272253,000362,800386,3001.9%23,5006.5% Engineering330,734336,587396,165493,450458,2002.2%(35,250)7.1% TotalPublicWorks2,220,7422,254,7162,457,9522,623,7502,771,50013.5%147,7505.6% Culture&Recreation: ParkMaintenance1,152,1051,185,5291,310,8521,548,7001,676,3008.2%127,6008.2% Recreation787,334661,903648,970801,050917,4004.5%116,35014.5% Sr.CitizenPrograms203,479153,302119,465133,950149,9000.7%15,95011.9% TotalCulture&Recreation2,142,9182,000,7342,079,2872,483,7002,743,60013.4%259,90010.5% TransfersOut 237,813887,986171,591 0.0%0.00% TotalGeneralFundExpenditures$16,027,876$16,783,972$17,373,188$18,913,650$20,490,000100.0%$1,576,3508.3% ^ CITYOFELKRIVER 2023PRELIMINARYBUDGET GENERALFUNDEXPENDITURESBYACCOUNT 20192020202120222023INCREASE/% EXPENDITURES:ACTUALACTUALACTUALBUDGETPROPOSED(DECREASE)CHANGE PersonalServices FullTimeSalaries$8,258,390$8,369,176$9,130,334$9,887,400$10,667,700$780,3007.9% Overtime241,940204,970276,223240,500263,50023,0009.6% PartTimeSalaries729,576773,721657,853786,750658,500(128,250)16.3% PERA981,7661,016,4941,123,0731,211,9501,295,95084,0006.9% FICA347,126346,884366,023411,500434,05022,5505.5% OtherRetirementContributions230,424237,496248,909245,000255,00010,0004.1% Medicare130,963131,705142,267158,000168,05010,0506.4% Insurance1,083,8431,097,4401,197,9401,326,8001,504,150177,35013.4% WorkersCompensation228,410215,240267,271327,550415,45087,90026.8% TotalPersonalServices12,232,43812,393,12613,409,89314,595,45015,662,3501,066,900 7.3% Supplies OfficeSupplies41,25641,08239,40539,95028,950(11,000)27.5% Fuels/Lubes180,234176,958154,724216,450314,35097,90045.2% UniformAllowance68,75374,643109,57266,65069,0502,4003.6% OperatingSupplies608,558654,970667,777716,400762,45046,0506.4% EquipmentParts152,808115,208145,394142,500205,30062,80044.1% StreetSigns19,18932,54649,61543,00046,0003,0007.0% 201,150 16.4% TotalSupplies1,070,7981,095,4071,166,4871,224,9501,426,100 Services&Charges AuditFees15,62517,70020,60523,50022,000(1,500)6.4% EngineeringFees1,47285,0005,000(80,000)94.1% LegalFees315,866232,017244,402255,000275,00020,0007.8% ProfessionalServices115,106136,27199,592120,850137,50016,65013.8% Telephone78,61573,35372,55879,75079,9001500.2% Postage12,0639,68410,05315,35014,600(750)4.9% Travel,Conferences/Schools118,91777,549113,688192,200191,500(700)0.4% CarAllowance4,8006,4009,6009,6009,6000.0% Advertising/Marketing17,59113,92712,4166,4009,0002,60040.6% Publishing13,00413,5118,82621,25022,6501,4006.6% Property/liabilityInsurance158,535163,537183,379207,900218,85010,9505.3% Utilities360,765404,871407,785436,500481,60045,10010.3% BuildingMaintenance137,984127,116155,182118,300176,65058,35049.3% Equipment/SoftwareMaint.439,792455,194522,253651,450715,50064,0509.8% ContractualServices183,948184,069214,024280,700348,15067,45024.0% BuildingRent1,6701,1126576,5006,5000.0% EquipmentRental36,18228,98835,33735,00030,500(4,500)12.9% Dues&Subscriptions53,04651,94050,65256,80055,450(1,350)2.4% Taxes&Licenses220967348950550(400)42.1% CreditCardFees16,10516,97119,65420,25021,7501,5007.4% Miscellaneous74,99344,27633,01666,00050,200(15,800)23.9% FleetReplacementCharge332,000348,000372,000404,000436,50032,5008.0% ITEquipmentCharge92,60092,600 TotalServices&Charges2,486,8272,407,4532,587,4993,093,2503,401,550308,300 10.0% CapitalOutlay37,718 TransfersOut237,813887,986171,591 TotalGeneralFundExpenditures$16,027,876$16,783,972$17,373,188$18,913,650$20,490,000$1,576,3508.3% CITYOFELKRIVER 2023BUDGET GENERALFUNDREVENUES 20192020202120222023INCREASE/% REVENUES:ACTUALACTUALACTUALBUDGETPROPOSEDDECREASECHANGE Taxes PropertyTaxes11,171,84811,934,04912,297,57213,109,30013,893,000783,7006.0% GravelTax158,232193,275233,745180,000225,00045,00025.0% TotalTaxes11,330,08012,127,32412,531,31713,289,30014,118,000828,7006.2% Licenses&Permits LiquorLicense76,4408,13073,59576,00082,0006,0007.9% CigaretteLicense3,0003,0504,6563,0004,0001,00033.3% THCLicense4,0004,0000.0% RentalLicense67,27950,99462,60365,00065,0000.0% MiningLicense24,83625,76125,84926,00026,0000.0% GarbageHaulerLicense1,8052,3552,4602,0002,50050025.0% 0.0% OtherBusinessLicense/Permit18,35516,48515,95516,00016,000 NPDESPermit19,42521,72824,67522,00024,0002,0009.1% BuildingPermit457,246407,688588,999500,000600,000100,00020.0% Plumbing/HeatingPermit136,723106,095191,019140,000160,00020,00014.3% PermitSurcharge55068075370080010014.3% AnimalLicense8009658000.0% OtherNonBusinessLic/Permit16,44021,58824,16515,00020,0005,00033.3% TotalLicenses&Permits822,899665,5191,015,529865,7001,004,300138,60016.0% IntergovernmentalRevenue MVCredit6,1366,1765,7566,0006,0000.0% FireStateAid200,423207,497218,909215,000225,00010,0004.7% PoliceStateAid294,632310,309276,543315,000320,0005,0001.6% PoliceTrainingReimb31,81429,16838,00232,00035,0003,0009.4% StateCrimePreventionGrant59,83142,64742,71755,00048,000(7,000)12.7% OtherGrants50011,570 607,367581,927623,000634,00011,0001.8% TotalIntergovernmentRevenue607,320 ChargesforServices Planning&ZoningFees25,46219,99233,72525,00025,0000.0% PlanCheckFee223,094182,459281,502250,000250,0000.0% SpecialAssessmentSearch7806301,2505005000.0% Copies1,7711,3831,4911,5001,5000.0% OtherGeneralGovtServices73152500(500)100.0% LockoutFees6,0004,4653,7805,5003,500(2,000)36.4% PoliceServices28,51418,27667,17718,00030,00012,00066.7% SchoolLiaison141,808149,368155,077162,000175,00013,0008.0% AnimalImpoundFee2,5001,0003001,000500(500)50.0% FireContracts269,829280,008289,662335,000400,00065,00019.4% FireServices6,4008,6872,4756,0003,000(3,000)50.0% StreetServices26,50816,54927,42625,00030,0005,00020.0% EngineeringServicesReimb34,42522,22316,50520,00020,0000.0% RecreationFees59,08913,48132,50560,00060,0000.0% SrCenterActivities43,7489,17236,26435,00037,0002,0005.7% Farmer'sMarket10,26710,67221,83915,00020,0005,00033.3% ElkRiverFest7,94750020,62219,00020,0001,0005.3% ParkUseFee22,74522,38725,23825,00035,00010,00040.0% SewerInspectionFee9,72017,52017,84013,00015,0002,00015.4% 1,1401,2751,0001,20020020.0% ContractorLicenseCheck1,125 TotalChargesforServices923,063779,9641,035,9531,018,0001,127,200109,20010.7% 20192020202120222023INCREASE/% REVENUES:ACTUALACTUALACTUALBUDGETPROPOSEDDECREASECHANGE Fines CourtFines133,23388,109125,266120,000130,00010,0008.3% ParkingFines1,260150 OrdinanceViolations1,1002,000 TotalFines134,49389,359127,266120,000130,00010,0008.3% OtherRevenue InterestIncome221,966117,415119,745100,000120,00020,00020.0% Refunds&Reimbursements224,635147,378145,251130,000125,000(5,000)3.8% ContributionsConcertSponsorships25,00019,00020,00020,0000.0% MiscellaneousRevenue24,28813,66013,91910,00010,0000.0% TotalOtherRevenue495,889278,453297,915260,000275,00015,0005.8% TransfersIn Transfers112490,425460 TransferCapitalOutlayReserv50,00078,50028,50057.0% TransferDevelopment10,60010,60010,60010,650(10,650)100.0% TransferMPF140,000(140,000)100.0% TransferARPA300,000300,000 TransferWWTP150,000155,000160,000165,000170,0005,0003.0% TransferLiquor500,000500,000500,000750,0001,000,000250,00033.3% 50,00052,00054,00056,5002,5004.6% TransferGarbage48,000 TransferUtilities1,129,4451,312,2181,355,0001,355,0001,380,00025,0001.8% TransferStormwater15,00015,500121,000135,000135,0000.0% TransferEDA38,00039,50041,00043,00045,0002,0004.7% TransferHRA31,50040,70041,90035,00036,5001,5004.3% TotalTransfersIn1,922,6572,613,9432,281,9602,737,6503,201,500463,85016.9% 18,913,65020,490,0001,576,3508.3% TotalGeneralFundRevenues16,236,40117,161,92917,871,867 GeneralFund ExpendituresbyCategory Services&Charges $3,401,550 17% Supplies $1,426,100 7% PersonalServices $15,662,350 76% GeneralFund RevenuesbySource Fines $130,000 TransfersIn ChargesforServices 1% OtherRevenues $3,201,500 $1,127,200 $275,000 16% 5% IntergovtlRevenue 1% $634,000 3% Licenses/Permits $1,004,300 5% OtherTaxes $225,000 1% PropertyTaxes $13,893,000 68% 2023PROPOSEDTAXLEVY LeviedLeviedLeviedPreliminaryProposed TaxLevyPay2020Pay2021Pay2022Pay2023 Pay2023 GeneralFund$11,938,300$12,315,000$13,109,300$14,000,150$13,893,000 Library69,00071,50075,95075,00075,000 GeneralPropertyTaxLevy12,007,300$12,386,50013,185,250$14,075,150$13,968,000 SpecialLevies: DebtService g619,920618,870602,650 2010APSBuildin 2020APSBuildingExpansion606,346606,346 2021AFireStation3/Equip.389,135389,135 EconomicDevelopmentTaxAbatement138,55098,45097,800131,475131,475 LakeOronoDredging100,000 TotalLevy$12,865,770$13,103,820$13,885,700$15,202,106$15,094,956 GeneralFundChangefromPreviousYear$750,900$376,700$794,300$890,850$783,700 PercentageChangefromPreviousYear6.7%3.2%6.4%6.8%6.0% TotalDollarChangefromPreviousYear$927,005$238,050$781,880$1,316,406$1,209,256 %Change7.8%1.9%6.0%9.5%8.7% NTCValue$27,823,086$29,409,713$31,581,676$38,101,440$38,101,440 TaxRate46.241%44.556%43.967%39.899%39.618% %IncreaseinNTC7.0%5.7%7.4%20.6%20.6% CITY OF ELK RIVER ESTIMATED TAX IMPACT Residential (Homestead): With Valuation Change Impact Estimated City Tax Estimated Market ValueTax Capacity Rate Property ValueExclusionTax Capacity Value Value 43.967%39.618%DollarPercent 20222023Change202220232022202320222023changechange $227,800$281,50023.6%$16,738 $11,905 $2,111$2,696$928$1,068$14015.1% $10,321 $5,236 $299,100$355,60018.9%$2,888$3,504$1,270$1,388$1189.3% $334,500$397,90019.0%$7,135 $1,429 $3,274$3,965$1,439$1,571$1329.2% $416,300$490,70017.9%$0 $0 $4,163$4,907$1,830$1,944$1146.2% $4,462 $0 $364,200$440,50021.0%$3,597$4,405$1,582$1,745$16310.3% $300,800$345,50014.9%$10,168 $6,145 $2,906$3,394$1,278$1,344$665.2% ** $263,000$340,00029.3%$13,570 $6,640 $2,494$3,334$1,097$1,321$22420.4% $250,000$250,0000.0%$2,353$2,353$1,034$932($102)-9.9% $14,740 $14,740 ** Median Value Home As property value increases, the market value exclusion is phased out at $413,800 & over. Per county assessor, residential market values increased overall approx. 19%. Commercial/Industrial: Estimated City Tax EstimatedTax Capacity Rate Property ValueValue43.967%39.618%DollarPercentTax Capacity Value 20222023Change2022202320222023changechange $4,645,100$5,266,30013.4%$92,152$104,576$40,516$41,431$9152.3% $4,034,200$4,699,40016.5%$79,934$93,238$35,145$36,939$1,7945.1% $1,676,700$1,905,60013.7%$32,784$37,362$14,414$14,802$3882.7% $2,786,100$3,158,30013.4%$54,972$62,416$24,170$24,728$5582.3% $2,000,000$2,000,0000.0%$39,250$39,250$17,257$15,550($1,707)-9.9%