12-21-11 Council Minutes - Laserfiche WebLink

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MINUTES CITY COUNCIL DECEMBER 21, 2011 2012 BUDGET ADOPTION The Mayor opened the Public Hearing to consider adoption of the 2012 Budget and levy certification. The Finance Director began her 2012 Budget presentation with a short video explaining the impact of State changes in eliminating the Market Value Homestead Credit (MVHC) replacing it with the Homestead Market Value Exclusion (HMVE). The Finance Director reported that the purpose of tonight's public hearing is to present information relative to the City's impact on property owners' 2012 property tax bill and receive input from residents. She noted that property tax bills are determined by the State Legislature, the County Assessor, and the various taxing jurisdictions. The taxing jurisdictions in Little Canada include the City; School District (either 623 or 624); Ramsey County; and the special taxing jurisdictions of the Metropolitan Council, Metropolitan Mosquito Control, Regional Rail Authority, and Ramsey /Washington Metro Watershed District. The Finance Director reported that for 2012, the City's Budget objectives were to reflect its financial goals and policies. These included to reduce and /or eliminate reliance on Local Government Aid (LGA), maintain existing services and programs, and maintain stability in the tax rate. Additionally, the City wanted to fund infrastructure replacement as well as general capital improvements. Additional budget objectives were to meet debt obligations, maintain the City's AA Bond rating, protect parks, lakes and open space, and position the City to address future challenges and opportunities. The Director then reviewed the proposed 2012 tax levy and estimated tax rate, noting that the 2011 adopted levy was $2,660,453 and the proposed 2012 levy is $2,660,453 for a 0% gross levy increase. Factoring in a slight increase in Fiscal Disparities distribution, the net levy is at - 0.26 %. However, due to declining market values and the elimination of the MVHC, the City's tax rate is increasing from 26.532 to 28.023. The Director then reviewed 2012 General Fund revenue highlights noting that revenues are projected to be down 3.1 %, the budgeted tax collection rate is 97.5 %, and property tax revenues are projected to be up 4.91 %. She again pointed out that MVHC is eliminated for 2012. The City is projected to received the same amount of dollars in LGA as was received in 2011, $195,843. There is also projected to be an anticipated surplus of $72,057 which will provide a cushion for possible deeper cuts to LGA. This reflects 37% of the LGA dollars scheduled to be received in 2012. The Director noted that 73% of General Fund revenues come from property taxes, 11% from Intergovernmental sources, 7% from Licenses and Permits, 5% from Fines /Charges for Services, and 4% from miscellaneous sources. 3