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   <br />  <br />  STAFF REPORT  <br /> <br /> <br /> <br />TO: Mayor Keis and Members of City Council <br /> <br />FROM: Sam Magureanu, Finance Director <br />REVIEWED BY: Chris Heineman, City Administrator <br />DATE: August 24, 2022 City Council Workshop <br /> <br />RE: Discussion on 2023 General Fund Operating Budget and Levy <br /> <br />BACKGROUND: <br />The purpose of this budget workshop discussion is to review the preliminary General Fund Operating Budget and <br />preliminary Property Tax Levy for 2023. At the regular City Council meeting on August 10, 2022 staff presented <br />a preliminary budget based on the three of the primary areas of the General Fund Budget. These include Personnel <br />Services, contracted Police Services through the Ramsey County Sheriff’s Department, and contracted Fire <br />Services through the Little Canada Fire Department. This memo includes a more detailed look at the proposed <br />General Fund Operating Budget and Levy for 2023. <br /> <br />The budget document is a planning and management tool for implementing the community's vision as identified <br />in the Comprehensive Plan and the City Council's Strategic Plan in order to ensure the ongoing provision of <br />consistent and cost-effective public services. While the primary purpose of this workshop will be to focus on the <br />General Fund as the city’s chief operating budget, we will also be highlighting some of the larger capital projects <br />that are currently included in the 2023-2032 Capital Improvement Plan (CIP). <br />  <br />OPERATING LEVY AND TAX RATE <br />Since personnel services (salaries & benefits) represent one of the primary expenditures in the proposed budget, <br />staff is providing three different Cost of Living Adjustments (COLA’s) and calculated three different <br />options/scenarios for the operating levy and tax rate: <br />1. 2.50% COLA – This rate was used as the lowest rate starting point <br />2. 3.38% COLA – This rate was calculated by using the averages rate from Cities Survey. The Survey <br />included 16 cities with rates varying COLA’s ranging between 2.75% and 5%. <br />3. 4.70% COLA – Calculated by using the approach that has been used in the last several years: <br />a. 75% weight of COLA’s (Average of 3.38%) in survey of Cities <br />b. 25% weighting of Consumer Price Index (CPI) increase (8.7%) from May 2021 to May 2022 <br />Note: The 2023 COLA is in addition to step increases of 3.25% based on the approved wage scale <br /> <br /> <br />