06-24-2019 Council Packet - Laserfiche WebLink

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(3) access to high technology; available capital and an excellent transportation system including major state highways and federal interstate highways which allows easy mobility in any direction. The transportation network is a very positive factor in making the City an ideal location for commercial/industrial development and redevelopment. The City is located in a region with varied economic base which has resulted in an unemployment rate that has consistently remained near or below national and state averages. While the national unemployment rate stood at 3.9% at the end of 2018, Minnesota’s unemployment rate was 2.9%, the City has a regional unemployment rate of 2.7% according to the Minnesota Department of Economic Security. Unemployment is expected to remain at or below the state average. The City is in a strong financial position. Because of its strong mixed use tax base and conservative fiscal policies, the City continued in 2018 to have a tax capacity rate that is 6th lowest out of 19 municipal taxing jurisdictions in the county. The strength of the City’s financial condition is also reflected in its bond rating of Aa+ from Standard & Poor’s that was achieved in 2014. LONG-TERM FINANCIAL PLANNING The Metropolitan Council requires all cities in the seven-county metropolitan area to have a Comprehensive Plan. The Metropolitan Council and state statutes require cities to update their plans every 10 years. The Little Canada Comprehensive Plan serves as a guide for orderly and economic private and public improvement. The scope of the plan is intended to include almost every factor that influences investments or improvements in the City. 2008 marked the completion of the City’s most recent Comprehensive Plan. A new plan will be approved in 2019. The City has long utilized Capital Improvement Planning (CIP) for facilities, equipment, and infrastructure to enable us to plan and fund needed capital expenditures. Typically, this is a five-year program that is updated and approved annually. It should be noted that staff does program expenditures beyond the five-year period to help ensure significant needs beyond the five-year period are not missed. The excess General Fund balance (balance available after complying with the General Fund Balance Policy) is annually allocated to the General Capital Improvement Fund (GCIF). 20% of Local Government Aid (LGA) received from the state of Minnesota also goes into the GCIF rather than the General Fund due to the potential volatility of this revenue source. The City also levies a substantial amount for the Infrastructure Fund in addition to pledging electric franchise fee revenues to help fund street and storm water system construction. By funding a large portion of depreciation from our Water and Sewer funds, we have also provided a stable source of revenue to address infrastructure needs in these areas. DEVELOPMENT ACTIVITY Residential and commercial/industrial new construction increased during 2018 with 260 permits issued with a total valuation of $16,522,622 as compared to 262 permits with a total value $7,314,990 in 2017. (126% increase in valuation) The increase was primarily due to an addition and renovation to an elementary school. The City expects construction activity for 2019 to be similar to 2018 with no major projects on the horizon and few undeveloped residential lots remaining. The City continues to review strategies regarding community development looking at how to best utilize sites in the City that would be candidates for new development and redevelopment projects.