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V.1. Resolution Approving the 2025 Tax Levy, 2025 HRA Levy and Adopting the 2025 General and Special Revenue Fund Budgets; Bishop CITY OF HOPKINS City Council Report 2024-146 To: Honorable Mayor and Council Members Mike Mornson, City Manager From: Nick Bishop, Finance Director Date: December 2, 2024 Subject: Hold 2025 Truth in Taxation Hearing and Approve 2025 Tax Levies and Budgets _____________________________________________________________________ RECOMMENDED ACTION MOTION TO Adopt Resolution 2024-069 Approving the 2025 Tax Levy, 2025 HRA Levy and Adopting the 2025 General and Special Revenue Fund Budgets. OVERVIEW The tax levy being recommended is $20,648,105, a $969,166 or 4.92% increase from 2024. City taxes on a median value home ($378,800) will be $2,254, a $63 or 2.88% increase from 2024. The tax levy being proposed has been reduced by $135,450 since the preliminary levy was adopted on September 3rd. $105,450 of the reductions were based on staff review and refinement of submitted budgets and have no service impacts. The remaining $30,000 reduces Climate Solution Fund grants expenditures from $150,000 to $120,000. The final levy can be adopted any time after the close of the public hearing but must be adopted and submitted to Hennepin County by December 28th. SUPPORTING INFORMATION • Tax Levy and Budget Overview • HRA/EDA Levy Overview • Truth in Taxation Statements Summary • 2025 Tax Levy Summary • 2025 General Fund and Special Revenue Fund Budgets • Truth in Taxation FAQ’s – Hennepin County Assessor’s Office • Resolution 2024-069 Finance Department Tax Levy and Budget Overview The Final 2025 levy would be set at $20,648,105, a $969,166 or 4.92% increase from 2024. City taxes on a median value home ($378,800) will be $2,254, a $63 or 2.88% increase from 2024. The two largest areas supported by the levy are public safety and capital projects & debt. This is a breakdown of City property taxes: Median Value Home ($378,800) Percentage Public Safety 861$ 38.2% General Government 344$ 15.3% Public Works 276$ 12.2% Parks and Recreation 159$ 7.1% Pavilion 49$ 2.2% Arts Center 41$ 1.8% Activity Center 41$ 1.8% Capital projects & debt 483$ 21.4% Total 2,254$ 100.0% Public Safety is comprised of police, fire and inspection departments. In total they make up 38.2% of the levy. The Police Department’s Mission is to serve the community with Honesty, Integrity and Respect. They accomplish this through community engagement, relationship building and providing education and youth initiatives. They also responded to 25,706 calls for service in 2023. They work diligently to prevent and deter crime. The Fire Department makes a positive difference everyday by providing quality fire response, prevention services, emergency medical, hazardous materials handling and emergency preparedness. In 2023, they responded to 2,262 calls. Their average response time is 4.6 minutes. Inspections – this is the smallest department within public safety and accounts for 0.8% of the tax levy. The Inspections Department budget is primarily funded through charges for service. The 2025 budget includes revenues of $971,275 and expenditures of $1,265,343. Capital projects and debt is the next largest portion of the levy making up 21.4%. It supports street reconstruction, capital projects at municipal buildings and equipment purchases. The City is completing a street reconstruction plan paid for through bond issuance, special assessments and user charges for water, sewer and storm-sewer. All streets in Hopkins are planned to be reconstructed by 2030. Continuing this program ensures the future preservation of our streets and helps maintain the quality-of-life Hopkins residents have come to expect. In order to fully realize the benefits of Southwest Light Rail the city invested in 8th Avenue and created the Artery. The Artery is a bike, pedestrian and vehicle connection and community space between a future light rail transit station and the City’s historic downtown. The $5.7 million project leveraged $2.6 million of grants from Metropolitan Council, Hennepin County and Three Rivers Park District. The City has also invested in the Blake Road Corridor. The City is adding several pedestrian friendly amenities including: multi-use trails, landscaped boulevards and upgraded street lighting. The Road will also be upgraded to handle future traffic and development demands. The $16 million project will receive reimbursements from Hennepin County ($8 Million) and utilize Municipal State Aid of ($3 million). The City’s share of the Artery project and Blake Road reconstruction were funded with debt. They also took advantage of limited outside funding sources in order to make needed improvements. Delaying the projects would likely result in higher costs and a larger City-share of the overall cost. The Pavilion levy being proposed is $448,500 or 2.2% of the levy. In 2018, the Pavilion was upgraded and expanded. The City needed to complete a project to replace a 27- year-old refrigeration system that was unreliable, developing leaks and being phased out by the EPA. The City was able to increase the scope of the project to include remodeled locker rooms, shower rooms, expanded lobby, remodeled offices, remodeled concession stand and expanded restroom facilities after receiving contributions from Hopkins School District ($1.0 Million) and Hopkins Youth Hockey Association ($1.0 Million). The project still required bond proceeds of $3.1 million to complete. The debt service for the bonds will be paid with a Pavilion levy through 2033. The Arts Center levy being proposed is $380,000 or 1.8% of the total levy. The Arts Center is a premiere cultural and artistic destination drawing over 250,000 visitors annually. The City believes that it is an excellent economic development tool that helped make Mainstreet vibrant and authentic. With this levy, the Arts Center will continue to be an asset to the Community. The Activity Center is a separate facility that is included in the general fund budget. The general fund levy amount being used for the Activity Center is $378,899 or 1.8% of the levy. The Activity Center’s mission is to provide pathways to “Experience the Upside of Aging”. It is a gathering place for mature adults. It is also used as a rental facility and community space. HRA/EDA Levy Overview The HRA/EDA Levy is the main revenue source for the City’s Economic Development Fund and plays an important role in the City’s continued efforts for redevelopment. There are levy limits based on 0.01850% of the City’s estimated market value. The market value used for the 2025 Levy is $2,847,535,300, resulting in a maximum tax levy of $526,794 which would be an increase of $39,141 or 8.03% from 2024. The proposed levy is $511,646 a $23,993 or 4.92% increase from 2024. Tax Year Maximum Allowable Levy HRA/EDA Levy $ Increase % Increase 2020 367,951 367,951 17,797 5.08% 2021 407,727 378,070 10,119 2.75% 2022 434,750 391,302 13,232 3.50% 2023 451,531 451,531 60,229 15.39% 2024 497,414 487,653 36,122 8.00% 2025-Proposed 526,794 511,646 23,993 4.92% Economic Development Fund The Fund coordinates the economic development processes not directly funded by specific project budgets and also supports Artstreet, the Arts Center, the Façade Improvement program, and marketing efforts. The main revenue sources of the fund are the HRA/EDA tax levy and excess tax increment financing. The 2025 budget includes the additions for 1/3 of the planner position focusing on micromobility, bike and pedestrian planning one mural project and increased marketing. The planner position and mural project were previously funded through federal grants. Truth in Taxation Summary Based on preliminary levies, the total taxes on a median value home in Hopkins will increase by $157 or 2.98%. Hennepin County adopted a preliminary levy increase of 5.5% and Hopkins Public Schools adopted a preliminary levy decrease of 2.7%. . Actual 2024 Preliminary 2025 % Increase Median Value Home 369,300 378,800 2.57% Hennepin County 1,266.90 1,351.55 6.68% City of Hopkins 2,191.22 2,270.29 3.61% School District 270 1,493.21 1,460.52 -2.19% Metropolitan Council 67.69 74.00 9.32% Other Special Taxing Districts 269.23 289.26 7.44% 5,288.25 5,445.62 2.98% TOTAL TAX COMPARISON Hennepin County provides Cities with summarized data from Truth in Taxation statements. The following chart shows the percentage of each property type that will see a decrease or increase in total taxes based on preliminary levies. The changes are caused by preliminary tax levies, changes to estimated market value and changes to the homestead market value exclusion program. Residential properties include single family houses, condominiums, townhomes and duplexes. Apartments will see the largest decreases. Residential Apartment Commercial/ Industrial Decrease/No Change 20.83% 8.93% 5.84% Increase .1% - 4.9%37.18% 62.50% 60.31% Increase 5.0% - 9.9%30.18% 12.50% 29.18% Increase 10.0% - 14.9%7.96% 7.14% 3.11% Increase 15.0% and Over 3.85% 8.93% 1.56% *based on total taxes CITY OF HOPKINS Most Cities in Hennepin County are experiencing similar trends. This chart shows the changes in total taxes for residential properties in Hopkins and Hennepin County. City of Hopkins Suburban Hennepin C ounty Hennepin County Decrease/No Change 20.83% 22.77% 19.01% Increase .1% - 4.9%37.18% 39.68% 35.38% Increase 5.0% - 9.9%30.18% 29.14% 31.30% Increase 10.0% - 14.9%7.96% 6.30% 10.45% Increase 15.0% and Over 3.85% 2.11% 3.86% *based on total taxes RESIDENTIAL SINGLE FAMILY PROPERTIES City of Hopkins Tax Levy For the Year Ending December 31, 2025 RECOMMENDED December 2, 2024 Actual RECOMMENDED % Increase Purpose FY2024 FY 2025 (Decrease) General Operations General Fund 14,426,326 15,321,075 6.20% Capital Levy - 445,000 100.00% Arts Center 345,000 380,000 10.14% Pavilion Fund 440,000 448,500 1.93% Equipment Replacement 360,000 180,000 -50.00% Permanent Improvement - 50,000 100.00% Parking - 75,000 100.00% Total General Operations 15,571,326 16,899,575 8.53% Debt Levy 4,107,613 3,748,530 -8.74% Total Levy 19,678,939 20,648,105 4.92% Actual Recommended FY2024 4.92% Increase City Taxes 2,191$ 2,254$ Dollar Increase 3$ 63$ Percentage Increase 0.14%2.88% Tax Calculation for a Median Value Home City of Hopkins General Fund Revenue Budget For the Year Ending December 31, 2025 RECOMMENDED December 2, 2024 Department 2024 Budget 2025 Budget % Increase (Decrease) Property Taxes 14,511,326 15,406,075 6.17% Intergovernmental Revenue Local Government Aid 1,081,012 1,084,775 Intergovernmental Revenue - Other 797,000 810,000 Total Intergovernmental Revenue 1,878,012 1,894,775 0.89% Licenses, Permits & Fines Court Fines & Penalties 176,000 176,000 Building Permits & Inspections 563,000 693,500 Inspection Fines & Citations 3,000 3,000 City Clerk - Business Licenses 8,900 12,400 PD - Liquor, Animal Licenses & Penalties 101,800 110,150 Fire - Licenses & Permits 4,000 4,000 Public Works - Licenses & Permits 19,615 19,615 Planning & Zoning - Licenses & Permits 2,000 4,000 Total Licenses, Permits & Fines 878,315 1,022,665 16.43% Charges for Service Finance Department 8,500 8,600 Inspections 175,450 274,775 Police 35,000 35,000 Fire 10,500 10,500 Public Works 3,150 3,000 Activity Center 118,500 154,500 Planning & Zoning - 16,000 Total Charges for Service 351,100 502,375 43.09% Miscellaneous Revenue Franchise Fees 346,200 620,600 Miscellaneous 25,250 45,000 Finance Department 3,000 3,000 Police 500 500 Fire 3,500 3,500 Public Works 10,600 8,000 Activity Center 14,000 14,000 Total Miscellaneous 403,050 694,600 72.34% Total Revenues 18,021,803 19,520,490 8.32% City of Hopkins General Fund Expenditure Budget For the Year Ending December 31, 2025 RECOMMENDED December 2, 2024 Department 2024 Budget 2025 Budget % Increase (Decrease) City Council 133,033 156,598 17.71% Administrative Services 536,656 661,290 23.22% Communications - 240,000 100.00% Information Technology 644,926 718,226 11.37% Diversity, Equity & Inclusion 133,530 107,000 -19.87% Finance 732,254 616,129 -15.86% Legal 250,000 265,000 6.00% Municipal Building 404,690 407,462 0.68% City Clerk 339,242 327,542 -3.45% Inspections 1,208,270 1,265,343 4.72% Police 7,185,841 7,519,164 4.64% Fire 1,709,014 1,982,178 15.98% Public Works 3,858,812 4,289,317 11.16% Recreation 276,441 276,735 0.11% Activity Center 554,334 609,694 9.99% Planning & Zoning 196,248 247,455 26.09% Community Development 129,312 125,357 -3.06% Tuition Reimbursement 19,200 19,200 0.00% Contingency 50,000 25,000 -50.00% Transfer to Depot/ACE Program 60,000 61,800 3.00% Total Expenditures 18,421,803 19,920,490 8.14% City of Hopkins Special Revnue Funds Budget For the Year Ending December 31, 2025 RECOMMENDED December 2, 2024 Revenues Fund No.2024 Budget 2025 Budget % Increase (Decrease) 203 State Chemical Assessment 65,000 65,000 0.00% 204 Economic Development 557,706 591,646 6.09% 212 MN Public Safety 439,095 453,901 3.37% 214 Parking 125,000 164,000 31.20% 216 Hopkins Race & Equity Iniative 6,000 6,000 0.00% 217 Communications (Cable TV)230,000 30,961 (86.54%) 219 Depot Coffee House 203,832 285,611 40.12% 231 TIF 2.11 Super Valu 2,820,000 2,820,000 0.00% 233 TIF 1.4 - Marketplace & Main 226,000 245,000 8.41% 234 TIF 1.5 - The Moline 2,515,000 1,770,000 (29.62%) 250 Arts Center 1,172,650 1,232,470 5.10% 260 Sustainability 385,000 345,000 (10.39%) Expenditures Fund No.2024 Budget 2025 Budget % Increase (Decrease) 203 State Chemical Assessment 65,000 65,000 0.00% 204 Economic Development 520,278 555,646 6.80% 212 MN Public Safety 439,095 453,901 3.37% 214 Parking 159,894 161,185 0.81% 216 Hopkins Race & Equity Iniative 6,000 6,000 0.00% 217 Communications (Cable TV)281,487 30,961 (89.00%) 219 Depot 183,832 270,611 47.21% 231 TIF 2.11 Super Valu 2,875,266 2,900,000 0.86% 233 TIF 1.4 - Marketplace & Main 214,948 44,768 (79.17%) 234 TIF 1.5 - The Moline 2,530,195 1,729,914 (31.63%) 250 Arts Center 1,144,097 1,219,259 6.57% 260 Sustainability 385,000 345,000 (10.39%) Fund Fund Hennepin County Assessor’s Office 300 South Sixth Street, Minneapolis, MN 55487 hennepin.us Truth in Taxation FAQ’s Tax Questions Why did my taxes go up? There are several items that affect your property taxes. Items that typically have a large impact include: • Changes to the tax levy (amount of money a government wants to collect from property taxes) made by the city, county, school district or special taxing districts. • Changes to the market value of your property. • Changes in the market values for the area or a shift in values for a certain type of property. • Legislative changes to the property classification rates, state aid formulas and other tax laws. • Legislative unfunded mandates (usually seen as an increase in local government tax levy). • New taxes approved by referendum. Why did my taxes go up more than my neighbors? Properties within the same neighborhood may show different value changes based on physical characteristics. There are numerous factors to be considered in each property, which will cause value to change differently. Some of the factors that can affect value are location, condition, size, updates or remodeling, quality of construction, number and type of amenities such as baths and fireplaces, basement finish, garages, decks, porches, and many others. Property information may have been corrected, resulting in an increase or decrease in value different from your neighbor. My neighbor doesn’t keep his house up and I do—And I get penalized for it in the form of higher taxes. Why? It’s not fair! Property taxes are calculated using the market value. Market values are based on what your home could sell for on the open market. A home that is well maintained should sell for more than a home that is not. Who do I talk to about why my taxes increased or how to lower my taxes? There are three entities that have a role in determining your property tax. • The State Legislature establishes property classes and class rates, determines levels of state aid to local units of government, sets the state general tax rate, and mandates unfunded programs to local government. • Local units of government determine their tax levy amount. • The county assessor assigns each property a market value and property classification as provided by state statute. The property tax is the result of actions taken by all three entities. The times and dates for the appropriate budget meetings impacting your property are on the TNT notice. The purpose of these meetings is for the taxing authorities to gain feedback and guidance to help finalize their budgets. Are there any programs out there, where can I get some property tax relief? https://www.revenue.state.mn.us/property-tax-refund Minnesota has two types of property tax refunds for homeowners: the regular property tax refund and the special property tax refund. You may be eligible for one or both, depending on your income and the size of your property tax bill. • The regular property tax refund is based on your household income and the amount of property tax you pay on your principal residence. • The special property tax refund requires your net property tax to have increased by more than 12% and at least $100. The special property tax refund is not based on income. • Senior Citizens Property Tax Deferral Program: This program allows people 65 or older to defer a portion of their homestead property taxes and is also administered by the State of Minnesota. Is it likely that the amount on my proposed property tax notice will be different than the amount on my tax statement? The amount on the proposed tax notice is an estimate. The actual amount will likely differ due to: • New school referendums could cause the estimate to be higher or lower than the estimated tax amount depending on if the referendum passes or not. • Change in homestead classifications. • Jurisdictions lowering their levy. The statement currently contains the maximum levy the taxing authorities can pass, this is usually very close to the actual tax amount, but it could change based on input received at the meeting. • Special assessments and other non-tax charges that may be billed on the tax statement. Value Questions How can you raise my value this much? There is no limit on the amount your property value can increase in any given year. Values are based on the market and what the property would sell for as of January 2 nd of each year. I haven’t done anything to my house in 10 years, but my value and taxes keep going up. Why? The estimated market value is what the assessor estimates your property would likely sell for on the open market. The estimated market value on your property indicates the value as of January 2, 202 4, for taxes payable in 2025. Property values can increase or decrease depending on the market even if no improvements have been made to the property. I just bought my property and want to know why you have my value more than my purchased price. I want to appeal the value, what is my option? Is it too late to appeal my value? The sale itself may not be a good, arm’s length transaction. The sale could have been a purchase of a foreclosure or a transaction between related parties. Refer to the sales verification document to guide you in more specific questions about the sale. Every spring, value notices are mailed out to property owners. Some cities have local board meetings and others have open book meetings. If your city has a local board meeting, you have from the time you receive your notice to the date of the meeting to appeal your value. If your city has an open book meeting , you have from the time you receive your notice until mid-May to appeal your value. Once this window has passed the only option is to appeal to tax court. • Depending on the type of appeal, you may take your case to either the Small Claims Division or the Regular Division of Tax Court. You have until April 30 of the year in which the taxes are payable to file an appeal with the Small Claims Division or the Regular Division of Tax Court for your valuation and classification. • For more information, contact the Minnesota Tax Court: • Phone: 651-539-3260 or for MN Relay call 1-800-627-3529 • On the web: https://mn.gov/tax-court/forms/ Why do I have an improvement on my property when I didn’t do anything? This is the assessor’s estimate of the value of new or previously unassessed improvements made to your property. This amount is included in the estimated market value of your property. How do you assess my property and what is it based on? How do I know it’s fair? Assessors value properties using a mass appraisal process to review sales of similar properties in the area over a set time period. This “estimated market value” represents what your property would sell for in an “arms -length” sale on the open market. To estimate a property’s 2024 market value, the assessor reviews property sales from October 1, 2022, to September 30, 2023. They adjust the prices for market trends to estimate the market value of your property on the next assessment date, January 2, 2024. Property owners can also look at the Hennepin County website and see what neighboring properties are valued at and what nearby properties have sold for. The building right next door to mine is valued lower but it is the same, why? There are multiple reasons why two similar buildings may be valued differently. First, the building may be the same, but the use is different which could constitute a different value. Or the outside of the structures are similar, but the inside of one of them may have gone through a major remodel and the interior quality of construction may be superior. Also, the site the structures sit on could be different in size or even location such as on a lake versus the non-lakeshore one across the street. Why is my value increasing when the market is declining? To estimate a property’s 2024 market value, the assessor reviews property sales from October 1, 2022, to September 30, 2023. They adjust the prices for market trends to estimate the market value of your property on the next assessment date, January 2, 2024. Sales that have occurred between October 1, 2023, and September 30, 2024, will be analyzed and reviewed for the 2025 assessment for taxes payable in 2026. The Notice of Valuation and Classification will be sent out in the spring of 2025 and any changes to the market will be reflected on that notice. Homestead Questions Why is my property non-homestead / Why is my property changing from homestead to non - homestead? If there has been a change in the ownership or occupancy of your property, this could be why the status changed. Even something as simple as a name change can affect your homestead status. Please note, anytime there is a change in ownership and occupancy, a new application is required. You can apply for homestead at: www.hennepin.us/homestead I just purchased my home, and it isn’t showing homestead on my notice or the public website? why? Our systems can take up a couple of weeks to update, but just to confirm, have you reapplied for homestead at this new web address? Anytime there is a change in ownership and occupancy, a new application is required. If needed, you can apply for homestead at: www.hennepin.us/homestead Why is my Homestead exclusion going down? Why do I no longer have a homestead credit on my taxes? For a homestead residence valued at $95,000 or less, the exclusion is 40 percent of market value, yielding a maximum exclusion of $38,000, at $95,000 of market value. For a homestead valued between $95,000 and $517,200, the exclusion is $38,000 minus 9 percent of the value over $95,000. The exclusion is therefore phased out for properties valued at $517,200 or more. Typically, the homestead exclusion will save you no more than a few hundred dollars on your annual property taxes. The homestead credit that was applied to your taxes was replaced by this homestead market value exclusion and is now applied prior to taxes being calculated. Classification Questions Why is my classification Residential Lakeshore when I don’t live on a lake? The classification of a property is based on the use of the property. It is possible for a property that has deeded access to a lake to be classified as residential lakeshore because the property has the ability to use the lake/dock. The tax rate for a residential classification and a residential lakeshore classification is the same at 1% up to $500,000 and 1.25% over any value over $500,000. My neighbors have an AG property classification, why don’t I when I have 2 acres of field? What can I do to get AG class? If I can get AG class how much will my taxes go down? Per MN Statute 273.13 subd. 23, In order for a property with a house on it to get the agricultural classification, the property must have at least 10 acres in production on the property. The statute also defines what qualifies as ag production. https://www.revisor.mn.gov/statutes/cite/273.13 The tax rate for agricultural classification will be determined by if it is homestead or not. If it is homestead, the rate is 0.5% and non-homestead is 1%. Why is my property classified as seasonal? What does that mean? The seasonal class is for properties that are not the primary residence of the owner and is not rented to anyone else. This property is typically a ‘cabin’. This class cannot change back to residential unless the original owner files for homestead or it sells. This cannot be homesteaded by a relative of the original owner. Miscellaneous Questions Why did my mortgage payment go up? It would be our recommendation that the property owner call their mortgage company to find out the specifics, but it could be that their escrow amount has changed. This change could be because of the taxes or their insurance. No specific questions, homeowner just wants to vent about taxes and value. Be polite and let them talk. Answer questions as needed and do your best to address their concerns. The value of my property increased 10% even though interest rates are higher than they have been in years. Inflation is high, prices are high – when is this going to stop and start to go down again? Assessors value properties using a mass appraisal process to review sales of similar properties in the area over a set time period. This “estimated market value” represents what your property would sell for in an “arms -length” sale on the open market. To estimate a property’s 2024 market value, the assessor reviews property sales from October 1, 2022, to September 30, 2023. They adjust the prices for market trends to estimate the market value of your property on the next assessment date, January 2, 2024. If outside factors such as interest rates start to affect the sale prices, we will follow those sales once we see the market show the affect. My business is terrible this year, why is my value so high? Any current adverse impacts to business operations are not directly relevant to the valuation of the real property in the same year. Market sales and data from the previous period are considered when setting the current value. Contact Assessor’s Office Office: 612-348-3046 Assessor.AO@hennepin.us Website https://www.hennepin.us/residents/property/property-taxes CITY OF HOPKINS HENNEPIN COUNTY, MINNESOTA RESOLUTION 2024-069 RESOLUTION APPROVING THE 2025 TAX LEVY, 2025 HRA LEVY AND ADOPTING THE 2025 GENERAL AND SPECIALREVENUE FUND BUDGETS THEREFORE BE IT RESOLVED, that the City Council of the City of Hopkins hereby approves the following sums be levied for 2024 upon the taxable property in the City of Hopkins, for the following purposes: General Levy General $16,899,575 Special Levies Debt Levies 2014A GO Street Reconstruction Bonds (3011A) 68,000 2014A GO Improvement Bonds (3011B) 29,000 2015B GO Tax Abatement (3013) 105,000 2015A GO Street Reconstruction Bonds (3014) 240,000 2016A GO Improvement Bonds (3017) 85,000 2016B GO Tax Abatement Bonds (3018) 10,000 2016C GO Bonds (3020B) 125,000 2017A GO Street Reconstruction Bonds (3021) 990,000 2017B GO Tax Abatement Bonds (3022A) 158,020 2018A GO Street Reconstruction Bonds (3024A) 80,000 2018A GO Improvement Bonds (3024B) 295,000 2018A GO Equipment Certificates (3024C) 52,794 2019A GO Street Reconstruction Bonds (3025A) 92,000 2019A GO Improvement Bonds (3025B) 252,889 2019A GO Capital Improvement Bonds (3025D) 40,000 2019B GO Refunding Bonds (3026B) 165,000 2020A GO Improvement Bonds (3027B) 141,000 2020A GO Street Reconstruction Bonds (3027D) 15,934 2020B GO Refunding Bonds (3029) 238,627 2021A GO Improvement Bonds (3030A) 197,113 2021A GO Street Reconstruction Bonds (3030C) 16,925 2022A GO Equipment Certificates (3031A) 123,742 2022A GO Improvement Bonds (3031B) 197,486 2023A GO Temporary Improvement Bonds (3032) 30,000 Subtotal Special Levies $3,748,530 TOTAL LEVY $20,648,105 HRA LEVY Housing & Redevelopment Authority Levy $511,646 This levy is made based on current law and the 2025 General Fund Budget of $19,920,490 That based upon staff analysis of special assessments currently levied for Permanent Improvement Bonds, alternative revenue sources for the Capital Improvement Bonds and Equipment Certificates, and available reserves within all debt service funds listed below, that the debt service levies for 2025 for the following issues be levied at amounts less than provided by the bond covenants. Bond Issue 2014A GO Street Reconstruction Bonds (3011A) 68,000 2014A GO Improvement Bonds (3011B) 29,000 2015B GO Tax Abatement (3013) 105,000 2015A GO Street Reconstruction Bonds (3014) 240,000 2016A GO Improvement Bonds (3017) 85,000 2016B GO Tax Abatement Bonds (3018) 10,000 2016C GO Bonds (3020B) 125,000 2018B GO Tax Abatement (3023) - 2018A GO Street Reconstruction Bonds (3024A) 80,000 2018A GO Improvement Bonds (3024B) 295,000 2018A GO Equipment Certificates (3024C) 52,794 2019A GO Street Reconstruction Bonds (3025A) 92,000 2019A GO Improvement Bonds (3025B) 252,889 2019A GO Capital Improvement Bonds (3025D) 40,000 2020A GO Equipment Certificates (3027A) - BE IT FURTHER RESOLVED, that the following amounts are budgeted for the Special Revenue Funds: State Chemical Assessment $65,000 Economic Development $555,646 MN Public Safety $453,901 Parking $161,185 Race & Equity Initiative $6,000 Communications $30,961 Depot $270,611 TIF 2.11 Super Valu $2,900,000 TIF 1.4 Marketplace and Main $44,768 TIF 1.5 The Moline $1,729,914 Arts Center $1,219,259 Sustainability $345,000 Adopted by the City Council of the City of Hopkins this 2nd day of December, 2024. By:___________________________ Patrick Hanlon, Mayor ATTEST: _______________________________ Amy Domeier, City Clerk Public Meeting for the 2025 Tax Levy and Budget December 2, 2024 Purpose of this Meeting Discuss and Review the City’s Budget and how it impacts your taxes Discuss the City’s Tax Levy Will NOT address individual property valuations Purpose of this Meeting Agenda Taxation Process 2025 City Budget & Tax Levy 2025 HRA/EDA Tax Levy Taxation Process Valuation notices sent each March for taxes payable the following year This is the time to appeal valuation Set Preliminary Levy on September 3 Proposed Tax Notices mailed November 12 Public Meeting for Final Levy on December 2 Adopt Final Levy by December 28 Property Taxes in 2025 Total market value in Hopkins increased by 4.9% (Gross Growth) Includes New Apartments valued at $75 million Net Growth of 2.0% Value of residential properties increased by 3.5% Value of median value home increased by 2.6% Homestead Market Value Exclusion Expanded in 2025 Maximum exclusion of $38,000 Previously $30,400 Phases out for properties valued at $517,200 or more Previously $413,800 2025 Preliminary Tax Statement Total Tax Changes for Residential Property (without improvements or classification changes) 21% -decrease 37% -increase by 0.1% -4.9% 30% -increase by 5.0% -9.9% 8% -increase by 10.0% -14.9% 4% -increase by 15% or more 2025 Budget & Tax Levy City Council has had 8 separate budget related meetings in 2024 Budget Information Session held August 12th Three attendees Advertised on Hopkins Highlights, Hopkins Connections and on Facebook 2025 Budget & Tax Levy Adopt Preliminary Levy on September 3rd Preliminary Tax Levy of $20,783,555 $1,104,616 or 5.61% increase from 2024 (basis for TNT statements) 2025 Budget & Tax Levy Public Hearing on December 2nd (tonight) Proposing a final tax levy of $20,648,105 Increase of $969,166 or 4.92% from 2024 $135,450 of reductions since September 3rd $105,450 based on staff review w/ no service impacts $30,000 to reduce the amount of Climate Solution Grant Expenditures (from $150,000 to $120,000) 2025 General Fund Budget Revenues of $19,520,490 or 8.32% increase Expenditures of $19,920,490 or 8.14% increase Revenue & Expenditures both include $240,000 to move Communications into the General Fund Use of Fund Balance Decrease Fund Balance by $400,000 City Policy is 42% or Five Months Cashflow, Contingencies or Emergencies Surpluses in 2020-2023 Projected to end 2025 with fund balance of $7.9 million or 42.9% 2025 Budget Additions Previously Authorized –ARPA Youth Social Worker Contract -$88,000 Planner Position -$40,000 Funded equally by General Fund, Economic Development Fund and Sustainability Fund Previously Authorized –2024 Budget Maintenance Worker –Forestry/Parks (May 1st) 2025 Budget Additions City Contribution to Fire Relief -$96,000 Primarily used for retirement benefits Retention/Recruitment for Paid On-Call Firefighters Tax Levy Support for Parking Fund -$75,000 Drop in user fees 2025 Budget Additions Tax Levy Support for Communications - $40,000 Declining cable franchise fees Moved into General Fund in 2025 2025 Tax Levy Actual RECOMMENDED % Increase Purpose FY2024 FY 2025 (Decrease) General Operations General Fund 14,426,326 15,321,075 6.20% Capital Levy - 445,000 100.00% Arts Center 345,000 380,000 10.14% Pavilion Fund 440,000 448,500 1.93% Equipment Replacement 360,000 180,000 -50.00% Permanent Improvement - 50,000 100.00% Parking - 75,000 100.00% Total General Operations 15,571,326 16,899,575 8.53% Debt Levy 4,107,613 3,748,530 -8.74% Total Levy 19,678,939 20,648,105 4.92% City Taxes on Median Value Home based on Recommended 2024 Actual Estimated Market Value as of 1/2/23 = $369,300 City Taxes -$2,191 Increase of $3 or 0.14% 2025 Recommended –4.92% Inc. Estimated Market Value as of 1/2/24 = $378,800 City Taxes -$2,254 Increase of $63 or 2.88% 2025 Tax Levy Median Value Home ($378,800) City Taxes $2,254 Increase of $63 or 2.88% City Service Percentage Public Safety 38.2% General Government 15.3% Public Works 12.2% Parks and Recreation 7.1% Pavilion 2.2% Arts Center 1.8% Activity Center 1.8% Capital Projects and Debt 21.4% Total 100.0% 2025 HRA/EDA Levy Main revenue source for the City’s Economic Development Fund Redevelopment efforts Artstreet Arts Center Façade Improvement program Marketing efforts 2025 HRA/EDA Levy 2025 additions 1/3 of planner position One mural project increased marketing Levy recommended is $511,646, a $23,993 or 4.92% increase from 2024