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MINUTES <br />City Council <br />February 24, 1982 <br />City's Nti11 Mr. Voto reported that the City's mili rate has been dropping the past <br />Rate few years> However, what is happening is that the State has not been <br />(Cont.) increasing its aid to local governments. Homestead Credit also pl.ays <br />a part. Voto commented that the property taxes on homestead properey <br />ha~ generally been coming do~m, but the cost ot services has not gone <br />down. <br />What it amounts to is that the State has deficit financing. Cities <br />have been prohibited from increasing tax levies to make up £or <br />shortages on local aids and Homastead Credits. <br />Mr. Voto submitted to the Council a report on the vatious property <br />tax mill rates of six communities includin~ Little Canada. That report <br />shows the general and special revenue and bonded debt percentage split <br />of Little Canada to be far di£ferenC from the other five communities. <br />D1r. Voto explained that the general and special revenue funds are the <br />operating funds of the City and the bonded debt funds are self-sufficient, <br />Voto explained that the reason for the difference in the percentage spl.it <br />from other cities is that the City made a policy decision on sqme of its <br />improvements to Einance a significant portion of the cost of these <br />improvements by general property taxes rather than entirely by special <br />assessments. 'This is the primary reason for the Czty's exisCi~g mi11 <br />rate. Voto stated that the City also had the intent that when connection <br />charges came in, it would cancel bonds; However, many assessments were <br />paid early, and the City Lost interest. <br />Mrs. Scalze asked what other cities do. Mr. Voto replied that oeher <br />cities have more of an assessment raCio than a tax Levy ratio. <br />Nir. Voto also in£ormed the Council that with the Caty's increased mill <br />rate it receives increased Local government aid. Mr. Voto reported that <br />the City's local aid figure increased by 260% since 1977. <br />Mr. Hanson commented that in the next few years the City should be able <br />to wipe out some of the levies on bond issues. <br />Mr. Voto also reported that the City got its cash reserves up so that <br />it could get investment income up. Mr. Voto reported that the City has <br />come a long way in terms of solving past problems. Voto stated that <br />the City is probahly in a position cahexe it will not increase levies <br />for pre-7,970 bond issues and may be able to eliminate supplemental <br />bond issues. Voto stated that he will have an up-dated special study <br />that will give the City a lot of this information shortly. <br />Mrs. Scalze asked Mr. Voto if he anticipated that the City willlevy <br />less each year. Voto replied that that is a possiUility. In terms <br />of the City's mill rate, it has decreased over the last five years. <br />Voto stated that the City may get to a point where 3t could maintain <br />the overall miil rate, but change the percentage split. <br />Mr. Voto commented that the City's mills would be less without fiscal <br />disparaties. <br />Page -15- <br />