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• Annual increases to the Pavement Management (Fund 421) operating tax levy to <br />complete street preservation projects to maintain a target street condition rating. <br />• Addition of a debt service tax levy for the 2024/2025 Street Reconstruction <br />Project. <br />• Addition of a debt service tax levy for the 2027 Street Reconstruction Project. <br />A pay-as-you-go methodology was applied to the capital needs in the Plan. Tax levies <br />were increased to support future capital needs and to avoid issuance of debt in future <br />years. To provide stabilization in the tax rate and utility rates, however, debt was <br />modeled into the plan: <br />• 2024/2025 Street Reconstruction ($4,575,000 issued in 2025) <br />o 15-year obligation at 4.00% interest to be paid back by a debt service tax <br />levy <br />• Otter Lake Road Extension ($8,692,500 issued in 2025) <br />o 20-year obligation at 3.00% interest to be paid back by Area & Unit Trunk <br />Fund (406), Municipal State Aid (420), and Surface Water Management <br />(422) revenues <br />• Public Works Facility ($13,600,000 issued in 2026) <br />o 20-year obligation at 3.00% interest to be paid back by Antenna Lease <br />Revenues within the Building and Facilities Fund (401), Area & Unit Trunk <br />Fund (406) revenues, and Water & Sewer User Fees <br />• 2027 Street Reconstruction ($4,450,500 issued in 2027) <br />o 15-year obligation at 3.00% interest to be paid back by a debt service tax <br />levy <br />• West Side Relief Sewer ($3,891,600 issued in 2027) <br />o 15-year obligation at 3.00% interest to be paid back by Area & Unit Trunk <br />Fund (406) revenues <br />Construction of a new Public Works Facility has been discussed by the City Council for <br />many years and the Plan includes the project in 2026. Dollars are requested in 2025 <br />from Building and Facilities Fund reserves for initial project development and feasibility <br />studies. The current cost estimate and funding allocation developed by Management do <br />not result in a tax levy impact due to annual revenue sources available for debt service <br />repayment within each funding source. If the City wishes to move forward with this <br />project the cost estimate and funding allocation, along with if the tax levy is impacted, <br />will need to continue to be refined. <br />Assumptions <br />The assumptions developed by Management are conservative and will continue to be <br />evaluated on an annual basis. Residential development is estimated at 160 homes per <br />year while no commercial development is estimated in the Plan. The value and timing of <br />commercial/industrial is difficult to predict and thus any additional tax capacity brought <br />by non-residential properties will further bring down the projected tax rate. <br />4 <br />