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MEMORANDUM DATE: December 6, 2006 TO: Mike Mornson, City Manager FROM: Roger Larson, Finance Director ITEM: CERTIFICATION — 2007 OPERATING BUDGET/TAX LEVY State mandated truth -in -taxation laws require cities to provide Hennepin.and Ramsey Counties with a certified 2007 Operating Budget and Tax Levy. This years General Fund budget total $4,521,700 compared to $4,242,000 for 2006, which represents a $279,700 increase. A review of the issues contributing to the increase is as follows: 1) Adjustment for increased motor fuel costs. 2) Employer health insurance contribution increased. 3) Cost of living adjustment for City Staff. a. 3.5% increase negotiated with the 3 unions. 4) Addition of part-time Community Service Officer. a. Hire date 07/01/07. 5) Additional police overtime (designated for St. Anthony). 6) Maintenance cost of the City parks. 7) Utility costs for City buildings. The General Operating Levy for 2007 totals $2,660,800 compared to $2,488,357 in 2006. This represents a $172,443 dollar increase from last years levy. The City portion of property taxes for a property with a taxable valuation of $258,000 is $1,125.87 (an increase of $102.53 from 2006). A breakdown of the City portion of the 2007 property taxes paid includes: 2007.Taxes Increase General Operating Budget $ 736.40 $ 58.70 Road Improvements $ 245.17 $ 40.49 Public Facilities $ 109.01 $ 2.04 Certificate/Fire Truck $' 25.32 $ 1.34 Tax Abatement (Central Park) $ 7.89 ($ .08) PERA Rate Increase $ 2.08 $ .04 Total City Taxes $1,125.87 $102.53 Recommendation: To comply with State Law and Truth -in -Taxation requirements, Council approves resolution #06-093 setting the 2007 Operating Budget and Property Tax Levy as presented. 36