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<br /> <br /> STAFF REPORT <br /> <br /> <br />TO: Mayor Fischer and Members of City Council <br /> <br />FROM: Sam Magureanu, Finance Director <br />REVIEWED BY: Chris Heineman, City Administrator <br /> <br />DATE: December 4, 2024, City Council Workshop <br /> <br />RE: 2025 Final Proposed Levy <br /> <br />REQUESTED ACTION <br />This is a discussion item only, and no action is required. The Council is asked to provide additional <br />feedback on the final proposed levy as presented below. <br /> <br />BACKGROUND <br />At the September 11th City Council meeting, the City Council adopted a preliminary tax levy increase <br />of 9.51%. The final levy may not be increased from the preliminary levy, but the final levy may be <br />reduced from the preliminary levy. The preliminary tax levy increase of 9.51% was used by Ramsey <br />County to prepare the notices of estimated property taxes mailed to property owners in November. <br />Those notices listed a public Truth in Taxation (TNT) hearing on the 2024 budget to be held at <br />tonight’s council meeting. <br /> <br />This presentation is intended to focus primarily on the community impact of the budget and options to <br />reduce the levy rather than presenting the details of the budget. Detailed presentations of the preliminary <br />budget were discussed at the August 18th, August 28th, and September 11th City Council workshops. <br /> <br />City staff is currently proposing a final 2025 levy increase of 7.84%. This would represent a decrease <br />of 1.67% from the adopted preliminary levy of 9.51%. A summary of the key contributing factors for <br />this decrease is listed below. <br /> <br />Contributing Factors <br /> City Council directed staff to lower the “property tax safe margin” from 2.5% additional levy to <br />1% in anticipation of a 99% collection rate. Per the City’s Financial Policy, the total sum <br />appropriated for the General Fund shall be less than the total revenue by a safe margin. It is the <br />policy of the City that this safe margin will allow for property tax collections of 97.5% in any <br />given year”, however at its discretion, City Council can adjust the safe margin. This decision <br />was made based on historical collection rates for the last ten years. The average collection rate <br />for the past ten years is 99.01%. <br />