Agenda Packets - 2024/05/06 - Laserfiche WebLink

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Item 03 Page 2 of 3 The Mounds View Vision A Thriving Desirable Community Street Improvement Fund • The current property tax levy is $150,000. Based on potential projects, this amount should be increased. • We continue to have sufficient projects to utilize our MSA street construction aid each year. It is projected that the projects in the plan will exceed the funding available and we will be drawing into future years to cover our costs. The City may want to explore an MSA advance. • Staff is proposing to direct a portion of the LGA funds the city receives to this capital fund. LGA has been unalloted in the past and staff would recommend trying to reduce reliance on these funds for general operations and instead, direct them more toward capital projects. • There is a definite need to stay on top of street improvement projects to ensure streets reach their useful lives and don’t require costly premature full reconstructions. Utility Funds • For all three utility funds, we are assuming a 4.5% increase in user charges and a 3.0% inflationary increase in costs each of the 10 years. • Water Fund – requires a much larger user charge increase than the 4.5% being assumed. • Sewer Fund – no I&I grant funds have been included in the plan as the amounts are unpredictable. • Surface Water Fund – the plan is assuming a 50% grant fund match for each of the future major dredging projects. Without grant funds, the City will need to postpone projects or increase user charges. Vehicle & Equipment Replacement Fund • Based on information received from the various departments, this fund is able to cover the costs of the vehicles and equipment anticipated to be replaced over the next 10 years. • The breakdown of transfers into this fund ($470,000) to cover the costs is as follows: General Fund $280,000 Water Fund $ 90,000 Sewer Fund $ 60,000 Surface Water Fund $ 40,000 Conclusion Staff is seeking direction from the City Council regarding the following items: 2025 projects As we review the 2025 projects, does the Council have any questions, comments or concerns about including them during budget preparation? 2025 property tax levy/transfers in The levies/transfers currently being proposed for 2025 are: Vehicle/Equipment Replacement ($280,000); Special Projects ($75,000); and Street Improvement ($150,000). Levy/transfer increases are needed for the Special Projects and Street Improvement funds. What increases, if any, should staff assume? 2025 Local Government Aid (LGA) There was a significant increase in local government aid funding for 2024. 90% of this funding is being included in the General Fund. LGA has been unalloted in the past and staff would recommend trying to reduce reliance on these funds for general operations and instead, direct them more toward capital projects. The previously unbudgeted 10% is being included in the Street Improvement Fund with the hope that this amount can increase with future budgets. Does the Council have a preference on where the funds should go?