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515 Little Canada Road, Little Canada, MN 55117-1600 <br />(651) 766-4029 / FAX: (651) 766-4048 ADMINISTRATOR <br />www.ci.little-canada.mn.us Joel R. Hanson <br />MAYOR <br />Bill 131esener <br />COUNCIL <br />Rick Montour <br />John Reis <br />Michael McGraw <br />Shelly Boss <br />MEMORANDUM <br />TO: Mayor Blesener and Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />Sharon Provos, Finance Director <br />DATE: September 18, 2014 <br />RE: 2015 Proposed Budget <br />The first draft of the proposed 2015 Budget is being presented for your consideration. With this <br />information, we need to establish our preliminary levy by September 30th• While this budget <br />document includes the General Fund, Special Revenue Funds, Debt Service Funds, TIF/I-IIA Funds, <br />Capital Improvement Funds, the Water Fund, and the Sewer Fund. The primary focus of our review <br />is the funds that require tax levy support. <br />The 2015 levy included in the budget document reflects a 4.16% gross levy increase and a 3.98% net <br />levy increase (see page 1 of the budget document). This budget maintains our current amount of <br />Local Government Aid (LGA) usage in the General Fund ($146,901) even though our LGA allotment <br />is increasing by $33,704 for 2015. By maintaining the same amount of LGA in the GF, we are not <br />attaining our previously established goal of reducing our GF reliance on LGA. (Note: We are <br />certified to receive $378,529 of LGA in 2015 with the balance of $231,628 being received in the <br />General Capital Improvement Fund.) <br />Based on information I have seen from other cities, a 3% levy increase seems to be about the average. <br />If the Council wants to reduce the levy to attain a lower percentage, here are the amounts (expense <br />reductions and/or revenue increases) we would need to attain a lower levy: <br />4.0% - $5,095 <br />3.5% - $18,720 <br />3.0% - $32,350 <br />2.5% - $45,940 <br />.On the revenue side with a 3% gross levy increase, we are using $32,085 more Local Government <br />Aid (LGA) in 2014 versus 2013 if we are to balance the budget based on the assumptions made. <br />(The balance of the LGA distribution is shown in the General Capital hnprovement Fund.) We have <br />C:\Users\kathy.glznzer1AppDma\I.oatl\Microsoft\Windows\Temporary Internet Files \Content.Outlook\KP.111020\2015 Preliminary Budget Memo -9 <br />18 14.docx <br />