11-28-01 Council Minutes - Laserfiche WebLink

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MINUTES CITY COUNCIL NOVEMBER 28, 2001. necessary. Duray reported that based on their review, the Committee considered two scenarios. Option A modified the allocation to provide greater funding of tax stabilization, the elimination of further tax reduction, and decreased funding of capital funds. Option B provided greater funding for tax stabilization, no further tax reduction, and an allowance fora 3% growth in property taxes. Duray reported that based on the positive movement the City has achieved in tax ranking, the Committee concluded that tax stabilization should be fully provided for from the debt levy funds, and the City should forego further tax reductions. The Committee also determined that the resulting decrease in funding to the General Capital Improvement and Infrastructure Funds brought these fund balances to a dangerously low level. Therefore, the Committee felt it prudent to allow fora 3% growth in property taxes in order to maintain sufficient balances in these funds. With the continued growth of tax base, a 3% increase in the property tax levy does not necessarily equate to a 3% increase in the City tax rate. As a result, it is the Committee's recommendation for adoption of Option B described above. In conclusion Duray commented that the City has been accountable for the expenditure of its tax dollars. This practice will need to continue. However, the City Council should not ignore essential needs. To do so will place a greater burden on future taxpayers. Therefore, the Debt Levy Reduction Committee believes it has provided a recommendation that strikes an appropriate balance between taxpayer accountability and good fiscal planning. Duray thanked the Committee members for their time and effort Fahey also thanked the Committee members for their efforts and hard work, and the fact that these citizens took time from their busy schedules to undertake this study and make a recommendations to the Council. Scalze pointed out that while the City's expenses are increasing, revenues are not increasing at an offsetting rate. Duray reported that the Committee took at look at needs through the year 2006 and felt that emphasis needed to be placed on tax stabilization rather than tax reduction. The Committee felt it was more prudent to stabilize tax rates over the long term, than try to achieve tax reduction in the short term, with larger increases later on. Duray reported that the Committee looked at several different projections and came up with a projected 3% increase in General Fwtd expenses that will still provide enough dollars through 2006 and 2007 to fund the Capital Improvement Fund and the Infrastructure Replacement Funds at adequate levels. Duray also pointed out that the 3% figure is also contingent on the City's tax base as well as the Council's redevelopment efforts that should result in an increased tax base for the City.