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8 <br /> <br /> <br />Breaking down the increase in the total levy, it can be summarized as follows; <br /> <br /> <br />• General Fund plus Vehicle/Equipment & Street Maintenance set- <br />asides account for about $591K, or 51%, of the increase. We’re <br />counting these together for the time being because those two set- <br />asides already existed in the 2024 GF levy as transfers. <br /> <br />• Debt Service accounts for $328K, or 29%, of the increase. <br /> <br />• New Capital levies account for $244K, or 21%, of the increase. <br /> <br />Update after Budget Workshop – The above pie chart changed substantially due to the shift of the franchise <br />fee revenue away from the General Fund. <br /> <br />In order to distribute the levy across the city, the County utilizes calculations of market value, homestead <br />exclusions, and class rates to calculate the tax capacity of each property. The sum of all tax capacity is <br />compared to the levy requested (less fiscal disparities) to determine the local tax rate. The Levy History <br />charts in the Appendices provide more insight on trends in this area. <br /> <br />Note: when we discuss or illustrate values and capacity below, it is shown in the “Tax Year”, as opposed <br />to the “Assessment Year”, which is the year prior. Those assessments are based on property and sales <br />evaluations from the year prior to the assessment year, so values and capacity for the tax year lag roughly <br />1.5 - 2 years behind the actual market or construction activity. <br /> <br />The total tax capacity for Lake Elmo increased by $1.3 million, or 3.7%, to $ 37,752,743. In comparison, <br />the past three years have averaged over 18% increases, and the 10-year average is 11.5%. <br /> <br /> <br />The slowed increase is due largely to the slowdown of housing prices. The increase to existing market <br />value (market value less new improvements) is now under $50 million, whereas the 10-year average is <br />closer to $120 million. In addition, new improvements have slowed to a rate closer to the average of 2019 <br />– 2022, at just over $100 million. <br /> <br />The chart below shows Estimated Market Value changes in the past 10 years. The green bar is the market <br />value from each prior year, the blue bar shows the market value increase to that prior year existing value, <br />Portion of Levy Increase <br /> - <br /> 5,000,000 <br /> 10,000,000 <br /> 15,000,000 <br /> 20,000,000 <br /> 25,000,000 <br /> 30,000,000 <br /> 35,000,000 <br /> 40,000,000 <br />2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 <br />Tax Capacity