VII.1. Review 2024 General Fund Budget and Tax Levy; Bishop
CITY OF HOPKINS
Memorandum
To: Honorable Mayor and Council Members
Mike Mornson, City Manager
From: Nick Bishop, Finance Director
Date: August 15, 2023
Subject: Review 2024 General Fund Budget and Tax Levy
_____________________________________________________________________
PURPOSE
To provide input and guidance for the 2024 General Fund Budget and Tax levy.
INFORMATION
The City Council reviewed a draft of the 2024 General Fund Budget and Tax Levy on
July 18th. The total levy presented was $20,930,315 or a 11.53% increase from 2023.
Council directed staff to review the levy and put together proposals with a 9%, 7% and
5% increases.
9% Increase
• Use $360,000 of surplus to reduce the General Fund Levy
• Use Public Safety Funding for Fire Command Position in 2024 , a $118,000 levy
reduction in 2024
• Reduce the Capital Improvement levy by $48,000
o Delay Activity Cener countertops and door replacement
o Cancel Activity Center Raspberry Room Sound System
• Reduce the Pavilion levy by $138,000
o Delay roof, window blinds, floor scrubber and scissor lift purchases
7% Increase
• Everything above
• Use $400,000 ($40,000 additional) of surplus to reduce the General Fund Levy
• Reduce Equipment Replacement levy by $122,300 and rely on reserves to fund
purchases
• Eliminate the Permanent Improvement Levy of $210,000
o Delay street lighting upgrades, Mainstreet installation and wooden fencing
on Excelsior Blvd.
Finance Department
5% Increase
• Everything above
• Eliminate newly requested forestry position
• Reduce Arts Center Levy by $30,000
o Fund has made significant progress on fund balance deficit with ARPA
• Eliminate the Capital Improvement Levy
o Delay Activity Center tuckpointing, brick repair, flashing and roof
replacement
• Use $50,000 of franchise fees to pay Burnes Park debt
Public Safety Funding
During 2023 Legislative Session, $210 million of on -time public safety aid was
authorized for Cities. The aid can be spent on fire, police, emergency medical or other
public safety needs. Hopkins will receive a one-time payment of $828,185.
Staff has reviewed public safety needs and offers the following recommendations. The
total cost of all recommendations is approximately $915,000 or $85,000 more than will
be received. A decision on the police requests and fire equipment does not need to be
made at this time. The Fire Staffing request is being proposed as a reduction to the tax
levy is included with all levy scenarios being proposed in this memo.
• Police Staffing: The Police Department recommends adding two additional police
officer positions for 2024 & 2025. There are currently 31 sworn police positions
included in the 2024 budget (30 in the general fund and one from ARPA). This
would increase the number of sworn positions to 33. The cost to add two
positions for two years is approximately $473,000.
• Police Canine Program: The Police Department recommends reinstituting a
canine program in the department. A canine program would increase our public
safety capabilities and give numerous other benefits to the dep artment and
community. The program has estimated start up costs of approximately $80,000
to $100,000.
• Police Records Management System: The current records management system
was purchased in 2012 and is nearing the end of its useful life. The repla cement
was scheduled in 2023 at an estimated cost of $200,000. Due to the costs
increases happening for all information technology and the difficulty finding a
partner agency, the cost estimate for implementing a system has been increased
to $500,000. In the 2024-2028 Equipment Replacement Plan presented on
8/8/2023 the increased cost is being paid for with fund balance reserves.
• Fire Staffing: The Fire Department recommends funding a Fire Captain with the
Public Safety Funding. This position is included in the adopted 2023 budget and
the draft 2024 budget. The position is being kept open while the Fire Staffing
study is being completed. Use of Public Safety Funding fo r this position would
reduce the tax levy and is included in all above proposals.
• Fire Equipment: The Fire Department recommends purchasing needed
equipment and technology that have been delayed due to budget constraints.
Purchases requested are additional fire hose, mobile data computers and
implementing a new records management system. The total cost is estimated at
$65,000.
FUTURE ACTION
A budget engagement session will be held on August 14 from 6-7 PM at City Hall.
Details will be posted on the City’s website: https://www.hopkinsmn.com/466/City-
Budget-Process.
A preliminary levy must be adopted by September 30th of each year. The preliminary
levy will be the maximum allowable amount for 2024 and can only be reduced.
A final levy must be adopted by December 31st of each year at or below the preliminary
levy amount. A Truth and Taxation hearing is planned for Monday, December 4th. The
final levy is planned to be approved at the December 5th City Council Meeting.