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Item No. 3. <br />Meeting Date: June 3, 2019 <br />Type of Business: Work Session <br />City Administrator Review: ______ <br /> <br />City of Mounds View Staff Report <br />To: Honorable Mayor and City Council <br />From: Mark Beer, Finance Director <br />Item Title/Subject: 2020 Draft General Fund Budget <br /> <br />There is no state levy limit for 2020. The charter will limit any levy increase to between 3.5 and <br />4.0 percent based on estimated inflation. The Department of Labor Statistics will release inflation <br />data around August 18th. City departments have been refining their budgets and more <br />adjustments will occur as more accurate information becomes available. The state has concluded <br />the current legislative sessions with Local Government Aid (LGA) proposed to increase from <br />$739,446 to $815,876. 90% of LGA was included in the 2020 budget. <br /> <br />Ramsey County will hold their annual tax meeting at the end of August, they will release <br />preliminary valuation information at that time and staff will be able to more accurately calculate <br />the preliminary tax rate and the effect on properties. The City will be negotiating with all three <br />bargaining groups for the next contract beginning in 2020. Health insurance premiums will be <br />provided in October so will be an estimate at this time. The City contribution for 2019 is up to <br />$1,125 per employee per month. <br /> <br />General fund Assigned fund balance (levy reduction) will be approximately $5,167,671 at <br />December 31, 2019. The Council has been using a measured draw down of the levy reduction <br />fund balance by $250,000 per year. The Strategic Plan proposes that to drop to $246,000 for <br />2020. The preliminary imbalance is $495,374, after considering the planned draw down of <br />$246,000 from the levy reduction fund balance there is an imbalance of $249,374. There are <br />several options that can be used to close this imbalance. (Increase revenues, reduce <br />expenditures, use fund balance, or a combination of all three) A 1% levy increase would generate <br />an additional $54,277. <br /> <br />The City needs to certify a preliminary levy and General Fund budget to the County by September <br />30th. This can be done anytime over the next few months. Once set the levy can go down but <br />not up. The City will hold a truth in taxation meeting on Monday, December 2nd, 2019 at 5:30pm <br />with a continuation meeting on Monday, December 9th, 2019 at 6:30 pm if needed. Final levy and <br />budget approval may occur at the December 9th meeting. <br /> <br />Conclusion <br />Staff is looking for any additional direction from the Council on how they would like to proceed. <br /> <br />Respectfully Submitted, <br /> <br /> <br /> <br />Mark Beer