08-23-2023 Council Packet - Laserfiche WebLink

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If the City Council decides to increase the preliminary levy by $100,000 in 2024, these funds can be used to decrease the total project cost. This would ultimately reduce the loan amount which will in turn reduce future annual debt levy service payment and interest payments, as well as reducing the burden of implementing a debt levy service payment all at once. An increase of the preliminary levy to 9.90% will have a minimal impact to residents. Base on a 5% increase in property market valuation, the impact to a median home valued at $341,250 in 2024 is approximately 3.47% or total increase of $28.75 over the prior year (2023). In comparison, the preliminary proposed levy increase of 7.06% would have a total impact of approximately 0.45% or $3.74 to a median value home owner. Alternatively, an increase to the preliminary levy in the amount of $100,000 could be designated towards the General Capital Improvement Fund (Fund 400). The City utilizes Fund 400 for park projects, public works equipment, computers, and other building and infrastructure improvements. The fund is typically funded by Local Government Aid (LGA) and periodic transfers from the General Fund. The Fund balance is projected to stay positive through 2032, however it currently has a declining balance and new revenue sources will be needed in the future in order to fund all of the capital expenditures currently identified in the Capital Improvement Fund from 2024-2033. A third alternative for use of the additional $100,000 funds would be to increase the current $160,000 levy for the Capital Improvements Infrastructure Fund (Fund 450) to a $260,000 levy. Fund 450 currently receives $160,000 of the property tax levy as well electric franchise fees and special assessments from street projects. Expenditures from this fund are related to street projects. As noted in the graph below, Fund 450 also has a declining fund balance is currently projected to go negative beginning in 2027. Additional revenue sources will be needed in the near future in order to fund all of the 2024-2033 currently identified capital expenditures within the fund.