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Memo - 2006 Budget Discussion-Gen Fund & Tax Levy CITY OF HOPKINS I FINANCE DEPARTMENT I MEMORANDUM Date: To: Subject: November 2, 2005 Mayor & City Council \\ ~x:.: Christine Harkess, Finance Director 2006 Budget Discussion - General Fund & Tax Levy From: At this work session we will review changes made to the 2006 General Fund budget and the impact on the tax levy. The General Fund levy was reduced by I % or $72,000 by reducing expenditures and the Debt Levy was reduced by $80,000, using excess project funds to write down the debt levy over the next four years. Total reduction to the levy is $152,000, which REDUCES the levy from a 6.10% increase to a 3.98% increase, a reduction of over 2%. Also impacting the levy is the fact that Hopkins is now a net contributor to the fiscal disparities program. The amount of the fiscal disparities distribution is a direct offset to our tax levy and that amount has gone down the past two years to the point that we contribute more than is distributed making us a net contributor to the program. This impacts our tax capacity rate. Despite being a net contributor to the fiscal disparities program our tax capacity rate will again be less than it was the prior year. What this means is that if all property values remained the same as in the prior year, taxpayers would see a TAX DECREASE despite the increase in the levy. As previously disclosed the city assessor stated that property values in Hopkins on the average increased 15% or more, therefore a median valued residential property will see a tax increase in 2006 of about $127. The General Fund tax levy reduction was accomplished by implementing the following adjustments to the 2006 General Fund budget. Eliminated HA V A election equipment from Elections Dept $15,000 Hennepin County has now agreed to fund all 9 machines Adjusted employee benefit line items to more accurately reflect costs of those benefits (shown net of anticipated health insurance increase) $35,000 Eliminated capital items from Activity Center department and moved the items to the ERP $13,000 Individual departmental line items reduced to more accurately reflect actual level of expenditures (net of anticipated increases) $ 9,000 The General Fund budget is balanced with a $175,000 contingency to support as yet unnegotiated salary increases, benefits and insurance premiums in addition to unexpected expenditures. The revised 2006 General Fund budget is a 0.4% decrease over the 2005 budget. CITY OF HOPKINS ANALYSIS OF TAX LEvY Purpose 2003 2004 2005 General Operations General Fund $6,167,437 $6,654,321 $7,261,263 Other Levies: PERA Levy $11,815 $11,815 $11,815 Capital Levy $0 $0 $25,000 HRA levy $106,000 $0 $10,000 Total General Levy * $6,285,252 $6,666,136 $7,308,078 Special Levies: GO Bonds $190,000 $210,000 $190,000 Improvement Bonds $143,000 $150,000 $147,000 HRA Revenue Bonds $550,000 $678,000 $475,000 Subtotal - Special levies $883,000 $1,038,000 $812,000 TOTAL LEVIES $7,168,252 $7,704,136 $8,120,078 (1) (2) Increase over prior year $577,112 $535,884 $415,942 .centage Incr (Deer) - Total 8.76% 7.48% 5.40% Tax Capacity Rate 56.099% 56.664% 48.944% Percentage IncrtDecr in Tax Capacity Rate 4.167% 1.007% -13.624% (1) (2) Notes * Included in Operating levy on Tax Statements (1) First portion of new facility bonds levied (2) Second portion of new facility bonds and no lGA 2006 Net Levy Proposed $7,261,263 $11,815 $25,000 $20,000 $7,318,078 $180,000 $147,000 $970,000 $1,297,000 $8,615,078 2006 Net Levy Revised $7,189,263 $11,815 $25,000 $20,000 $7,246,078 $180,000 $147,000 $890,000 $1,217,000 $8,463,078 $495,000 $343,000 6.10%11 3.98%1 49.387% 48.414% est 0.905% -1.083% 11/3/05 REVISED CITY OF HOPKINS ESTIMATED PROPERTY TAX IMPACTS FOR CITY LEVY'S RESIDENTIAL HOMESTEAD PROPERTY Iner/(Decr) over Previous Year if Tax Rate is same with Market Value Incr Incr/(Decr) over Previous Year at Iner Market Value (2004 to 20052 Incr/(Deer) over Previous Year at 2005 Market Value ASSUMES A 15% INCREASE IN MARKET VALUE FROM 2004 TO 2005 48.414 City Taxes Pyble 2006 at 2005 MktValue 48.944 City Taxes Pyble 2005 at 2005 Mkt Value 2005 Mkt Value usedfor 2006 Taxes Tax Rate 2004 Mkt Value used for 2005 Taxes 105 $ 96 $ (9) $ 796 $ 805 $ $164,406 142,962 $ 139 $ 127 $ (12) $ 1,053 $ 1,064 $ $217,44 89,079 $ 208 314 $ $ 190 288 $ $ (17) (26) $ $ 1,575 2,379 $ $ 1,592 2,405 $ $ $325,278 $491,45 282,850 427,349 $ $ Incr/(Decr) over Previous Year if Tax Rate is same with Market Value Incr Incr/(Decr) over Previous Year at Iner Market Value (2004 to 2005) 2005 Value Incr/(Decr) over Previous Year at Market ASSUMES A 10% INCREASE IN MARKET VALUE FROM 2004 TO 2005 48.414 City Taxes Pyble 2006 at 2005 MktValue 48.944 City Taxes Pyble 2005 at 2005 MktValue 2005 Mkt Value usedfor 2006 Taxes Tax Rate 2004 Mkt Value used for 2005 Taxes 70 $ 62 $ (8) $ 761 $ 770 $ $157,258 42,962 $ 93 $ 82 $ (II) $ ,007 $ ,018 $ $207,987 189,079 $ 138 209 $ $ 122 184 $ $ (16) (25) $ $ 1,506 2,276 $ $ 1,523 2,301 $ $ $311,135 $470,084 282.850 427,349 $ $ ~3/2005 CITY OF HOPKINS GENERAL FUND BUDGET Budget % IncrJ(Decr) Over 2005 Budaet Revised 2006 Budaet Comments -1.35% 6.69% 1.82% -12.58% -12.36% 0.00% 0.00% -0.26% $ 6,337.098 $ 1.310,890 $ 639,400 $ 191,750 $ 19,150 $ 110,000 $ 290.000 $ 8,898.288 2006 Budget $ 6,458,078 $ 1,261,910 $ 639,400 $ 191,750 $ 19,150 $ 110,000 $ 290,000 $ 8,970,288 2005 Budaet $ 6,423.919 $ 1,228,669 $ 627,975 $ 219.350 $ 21,851 $ 110,000 $ 290.000 $ 8,921,764 2005 Est Actual $ 6,478,099 $ 1.212,624 $ 551.316 $ 175,700 $ 13,700 $ 95,000 $ 290,000 $ 8,816,439 2004 Actual $ 6,372,727 $ 743,812 $ 687,655 $ 277,206 $ 56,283 $ 48.919 $ 242,431 $ 8,429,033 2003 Actual $ 5,932,258 $1,094,005 $ 773.530 $ 333,140 $ 9,728 $ 114,953 $ $8,257,614 2002 Actual $5,799,310 $1.521,976 $ 583,666 $ 260.162 $ 116.211 $ 50,859 $ $ 8,332,184 REVENUES Property Taxes Intergovernmental Revenue Licenses. Permits & Fees Charges for Service Miscellaneous Revenue Interest Earnings Franchise Fees Total Revenues 0.01% 0.00% 0.01% 96,277 1,050 97,327 $ $ $" 96,277 1,050 97,327 $ ! $ 96,263 1,050 97,313 $ $ $ 86,508 1,000 87,508 $ ! $ 84,413 802 85,215 $ ! $ 80,159 648 80.807 $ ! $ 78,218 4,746 82,964 $ ! $ EXPENDITURES City Council Council Administration Health & Welfare line item never used reduced travel costs -1.84% -0.97% -0.66% 1.06% -3.06% 2.13% -1.42% 81.647 20,854 33,889 43.010 13,360 8,760 86,145 $ $ $ $ $ $ $ 83.899 21.129 36.070 43.666 13,528 8,850 191,447 $ $ $ $ $ $ $ 83,175 21,059 34,115 42,557 13,782 8,577 188,823 $ $ $ $ $ $ $ 52,414 13.219 32,757 37,477 24,378 7,078 140,496 $ $ $ $ $ $ $ 23,867 10,011 30.494 40,812 15,686 3,897 76,320 $ $ $ $ $ $ $ 84,048 13,491 41,344 36,509 26,172 4,039 65,788 $ $ $ $ $ $ $ 04,396 14,881 38,003 39,542 25,442 4.382 82.299 $ $ $ $ $ $ $ Administrative Services Administration Legislation Agenda Personnel Capital Improvements Health Assessment & Wellness Information Services Training recorded in this dept beginning in 2005 all IT is now budgeted at $2,500 3% -1.56% -4.61% 5.48% -1 387,665 13,168 19,701 21,983 $ $ $ $ 398,589 13,386 20.076 22,362 $ $ $ $ 392.088 13,377 20,653 20,841 $ $ $ $ 307.819 1.364 8,736 9,878 $ $ $ $ 201,087 17,329 18.306 22,443 $ $ $ $ 271,391 15,478 28,381 11,081 $ $ $ $ 308,945 16,374 27,960 7,741 $ $ $ $ Finance Benefit Administration Budget Cash Management Contractual services and Equipment charges reduced Contractual services - banking fees were not accurately budgeted in past years. All department costs are allocated back funds service to deb 00.00% $ 433 $ 400 $ (535) $ (555) (525) $ $ (839) 51,443 $ $ Managemen Deb Publication fees needed to be increased due to state requirements and increased costs. 2.95% -2.52% 1.09% -73.80% 204.00% -0.16% 60,037 32,533 10,601 (136) (1,304 56,583 $ 34.374 $ 10,790 $ (3) $ (2) $ 63,714 $ 62,298 $ 33.373 $ 10,487 $ (519) $ (100) $ 156,828 $ 58,316 s $ $ $ $ $" 57.635 33,540 9.387 (15) (5,723 144,267 $ $ $ $ ! $ 57,539 32.329 9,175 674 $ $ $ $ $ $" 49,240 38,388 5,751 485 (1.338 46.941 $ 46,866 $ 4.593 $ (867) $ 142 $ 53,413 $ $ $ $ $ $" General Accounting Payroll Risk Management TIF Administration Utility Billing costs should be allocated back to TIF funds costs should be allocated back to Utility funds AI AI Prosecuting reduced due to history of actual consistently being below budget. 5 of -7.24% 26,600 $ 126,600 $ 36,480 $ 2,274 $ 3,673 53,567 8.280 $ 119,871 $ 112,749 $ Legal '3/2005 Budget % Incr/(Decr) Over Revised 2006 Budget 73,293 Comments Budget up $49,467 . Personnel up $15,923 - new employee for a full year; Contractual seNices (custodial) up $4,000; gas up $4,000; electricity up $3,000; equipment charges increased by $2,284; capital items include a man lift at $6,200, roof repairs at $9,000 and installation of dual gas valves on two boilers per new code at a cost of $1,850. 2005, Budget 39.95% $ 2006 Budget 67,125 $ 2005 Budget 23.526 $ 2005 Est Actual $ 108,630 2004 Actual 65,085 $ 2003 Actual 77,620 $ 2002 Actual 71,832 $ Municipal Building Activity Center Community Use PT salaries increased by $4,694 for custodial help; capital outlay items include $8,000 for security system. Heating costs increased $7,500; share of liability insurance is more accurately budgeted; capital items include insta dual gas values per new code at a cost of $1,150 9.50% -3.25% 27.98% 06.274 131.929 55,418 $ $ $ 07,173 38,570 55,023 $ $ $ 97.055 136.361 43,303 $ $ $ 85,337 125,221 41,760 $ $ $ 74,924 147,136 47,453 $ $ $ 83,824 135,839 58.978 $ $ $ 78,310 21,199 60.903 $ $ $ Senior Activities Maintenance salaries for 2006 budget per JG are different basis than used in 2005 - adjusted to reflect actual costs 6.11% .0.05% 293.621 45.733 $ $ 300.766 41,415 $ $ 276.719 45.754 $ $ 252,318 43,727 $ $ 269,513 50,863 $ $ 278,641 48,732 $ $ 260,412 56,704 $ $ Receptionist salaries line item more accurately budgeted. 2006 budget is in line with 2005 est actual personnel costs more accurately budgeted -1.06% 1.95% 2.74% 64,876 25.552 64,922 $ $ $ 65.331 29,129 65,149 $ $ $ 65.571 26.059 57,585 $ $ $ 63,318 27,136 63,233 $ $ $ 85,639 30,418 46,764 $ $ $ 88,609 33.951 81,068 $ $ $ 96,108 34,616 83,655 $ $ $ Assessing Assessing Information Homestead Information Property Valuation -282.26% -0.16% 0.650(0 -4.33% 4,119 51,231 301,666 25,589 ! $ $ $ 3,914 55,695 314.896 25,937 ! $ $ $ 2.260 151,475 299,713 26,747 ! $ $ $ 5,993 147,694 280,718 19,013 ! $ $ $ 19,476 82.297 285,81 19,539 ! $ $ $ 21.995 225,623 219.344 21,341 ! $ $ $ 17.981 232,360 159,282 32,466 $ $" $ $ Special Assessmsnts Inspections Building Code Inspections Fire Inspections 2006 Materials, services, supplies budget more accurately reflects actual of past several years. -0.31% 1.08% 0.31% 3.72% 0.52% 87,882 46,659 22,177 46,402 530,375 $ $ $ $ $" 88,991 47,225 22,240 46,966 546,255 $ $ $ $ $" 88,152 46,159 22,108 44.737 527,616 $ $ $ ! $ 77,518 40,889 23,080 39,354 480,572 $ $ $ ! $ 79,737 42,050 18.383 39,432 484.952 $ $ $ ! $ 73.840 41,475 18,535 42,001 416.536 $ $ $ ! $ 65,423 43,339 25,347 63,458 389,315 Heating & Plumbing Inspections $ Housing Inspections $ RestauranUHotellnspections $ Misc Community Inspections ...! $ Budget increased $1,164 Budget increased $1,041 PT salaries and related benefits increased $7,100 due to lack of volunteers; office supplies up $1,000; professional services increased by $1,000 for offsite storage; contractual services up $2,900 for license fees; 8.79% 7.00% -3.06% 97.73% 14,399 15.913 7,988 24,544 $ $ $ $ 14,769 16,094 9,777 24.725 $ $ $ $ 3,235 4,872 8,240 2,413 $ $ $ $ 0,014 3,364 8.928 3.017 $ $ $ $ ,662 2,700 0,809 9,885 $ $ $ $ 8.023 3,315 9.809 8.937 $ $ $ $ 4,915 2,058 2,613 7,240 $ $ $ $ Administration City Clerk Charter & Council Licensing Purchasing Records Management Election year - postage and maintenance line items up by a total of $2,500; election judges increased budget by $10,300. 5 201 28.88% 57.21% 62,844 35,376 $ $ 65,365 50,510 $ $ 48,760 22.502 $ $ 45.323 9.666 $ $ 45,056 35,339 $ $ 50.084 20.341 $ $ 46,826 31.315 $ $ Elections '3/2005 Budget % Incr/(Decr) Over 2005 Budget Revised 2006 Bud[et 2006 Budget 2005 Bud[et 2005 Est Actual 2004 Actual 2003 Actual 2002 Actual Personnel costs increased $8,800; office supplies up $2,000; advertising and publications up $3,200 Personnel costs increased $144,297 - change in staffing allocation and PERA costs; other contractual services up $5,600; Capital includes 2 tasers and equipment at $1,800 Vehicle purchased in 2005 at a budget of $20,000 Change in salary allocation Change in salary allocation; $10,100 for forensic computers and software and a 800 Mhz Varda alarm. Change in salary allocation 2005 - purchased PT cruiser Personnel costs increased by $17,600 due to insurance and PERA, all maintenance for radios is now budgeted here (formerly also in patrol); Change in salary allocation; personnel costs up by $14,138 Police admin costs Comments Police Police Administration 5.90% 47,134 $ 152,327 $ 26.950 $ 93,958 $ 58,880 $ 39,809 $ 36,731 $ 4.88% ~9.41% -20.81% 7.80% $ 2,223,523 57,724 40,248 382.624 $ $ $ $ 2,272.171 58,358 40,633 399,309 $ $ $ $ 2.120,057 63,723 50,822 354,945 $ $ $ $ 2,118.604 55.654 40,137 369.154 $ $ $ $ 2,072,792 38,142 37.661 373,949 $ $ $ $1,872,075 48.200 38,035 403,496 $ $ $ $1,973,253 66,031 32,741 314,007 $ $ $ Patrol HEAT Team ReselVes Investigations .09% ~34.55% .8.15% 8.09% 94.837 15,750 77.906 421.967 $ $ $ $ 96,426 15.824 79.605 428.507 $ $ $ $ 93.810 24.063 84.822 390.382 $ $ $ $ 93,652 24,886 75.288 389.099 $ $ $ $ 91.207 24.939 75.942 402.763 $ $ $ $ 52.641 21.150 62.952 373.637 $ $ $ $ 41.298 16.363 65.601 05.842 $ $ $ $ Metro Drug Task Force Pawn Shop Police ~ Outreach Dispatch 6.30% 64.62% 5.86% $ 218.502 $ 114.648 $ 3.794.863 $ 225.152 $ 114.648 $ 3.882.960 $ 205.548 $ 69.644 $ 3.584.766 $ 201.899 $ 108.996 $ 3.571.327 $ 211.040 $ 181.984 $ 3.569.299 $ 216.919 $ 206.426 $3.335.340 $ 148.285 $ 388,472 $3,188.624 Reception-Records Systems Management state aid grants increased which increases expense and it's pass through funding state aid grants increased which increases expense and it's pass through funding; uniforms increased by $2,000; conference fees increased by $1 ,800 for new firefighter training PT salaries increased by $8,900 ~ more accurately reflects actual; state aid increased which is pass through funds; supplies increased by $5,380 for more promotional items for public classes at schools Fire Emergency Medical Service 0.29% 43,789 $ 43.794 $ 39,704 $ 36.524 $ 39,136 $ 36.610 $ $ 39.082 $ Fire Supresslon 3.89% 6.26% 485.576 26.682 $ $ 487.158 25.881 $ $ 467.396 08.969 $ $ 463,426 07.071 $ $ 468.287 97.717 $ $ 464.734 02,798 $ $ 440.985 07.762 $ Fire Prevention 5 301 6.49% 3.52% 656.047 5.290 $ $ 656.833 5.290 $ $ 616.069 5,110 $ $ 607.021 6,960 $ $ 605.140 8,189 $ $ 604.142 7.189 $ $ 587.829 2.774 $ $ Emergency Preparedness '3/2005 Budget % Incr/(Decr) Over 2005 Budget Revised 2006 Budget elim PT salaries; increase contract services for custodia; $8,000; general supplies line item more accurately reflects actual; security maintenance agreements $2,100; heating fuel $3,000; electricity $3,000; increased maintenance due to larger building Health insurance budgeted to reflect actual; added other contractual services at $1 ,500 for annual tech support of maint software and vehicle scanner updates; added line item for cell phone $600; property insurance increased by $1,700 Health insurance budget reduced to reflect actual; travel increased $1,700 General supplies for Arcview license $1,200; added $7,000 for revised topographical maps through Hennepin Co; equipment charges increased Change in allocation of personnel & down one employee; equipment & vehicle parts up $4,800; many line items reduced, equipment charges are up ~ more equipment OT and PT salaries increased; chemicals up $8,000; two snow blowers budgeted at $2,000 Down one FT person; property insurance increased - more in line with actual; Maetzold garage roof repair $5,000; weed eaters, aerator, tractor mounted rotor tiller $8,000 Supplies ~ tree stock & flowers up $4,000; contractual services up for OED tree removal costs; disposal charges increased $5,000 for tree disposal costs; 3 chain saws $2,000 Comments 39.85% 33,078 $ 2006 Bud[et 32.285 $ 2005 Budget 23.653 $ 2005 Est Actual 3,624 $ 2004 Actual 40.749 2003 Actual 3.063) $ 2002 Actual (282) $ $ Public Works PW Buildings Program 19.59% 41,305 $ 43,347 $ 34.538 $ 28,650 $ 23,123 $ 66 41 $ 38,209 $ PW Equipment Services 14.07% 15,108 $ 9,926 $ 3,245 $ 7,727 $ 25,741 $ ,052 $ 53 11 $ PW Administration 3.71% 132,500 $ 34,42 $ 6,522 $ 95,208 $ 75,287 $ 38,708 $ 163 $ PW Engineering 4% -4. 773,617 $ 781,633 $ 806.996 $ 690,627 $ 705,561 $ 655,090 $ 797,911 $ Street & Alleys 5.27% 130,050 $ 30,840 $ 23,537 $ 9,605 $ 82,61 $ 9"\,896 $ 75.167 $ Snow & Ice Removal -3.66% 7.53% 542.606 208.589 $ $ 551,022 210.008 $ $ 563,234 93,977 $ $ 526,249 206,006 $ $ 475,83 214,965 $ $ 558,381 58,867 $ $ 541.180 35,743 $ $ Parks Tree Service no significant changes no significant changes no significant changes based on joint recreation costs 0.06% 0.11% ~O.19% 2.67% 2.01% 1.61% ,876,853 31,000 13.320 11.165 152,500 207,985 $ $ $ $ ! $ .903,482 31.000 13,320 11,165 152,500 207,985 $ $ $ $ $ $" ,875,702 30.965 13,345 10,875 149,500 204,685 $ $ $ $ $ $" ,677,696 24.860 13,018 10.090 152,986 200,954 $ $ $ $ ! $ ,643,868 20,035 7,165 10,692 50,555 88,447 $ $ $ $ ! $ $1.632.097 22,535 13.641 15,816 150.560 202,552 $ $ $ $ $" $1.710,244 24,588 14,643 16,228 275,108 330,567 $ $ $ $ $" Recreation Playground Ice Rink Park Service Joint Recreation salary allocation only -41.37% 4,520 7.710 $ 4.580 $ not previously in General Fund $ 9,767 $ 44,056 $ 8,200 $ 38.061 $ Skate Park Planning Zoning Activities & Enforcement Office supplies up $3,700 for Arcview software; training up $2,500 for Arcview training 2.05% -1.04% 1.30% 7.40% 58,908 9,288 27,463 95,659 $ $ $ $" 61,695 9,397 27,811 98,903 $ $ $ $" 52,574 9,386 27,111 89.071 $ $ ! $ 44,172 8,185 24,236 76,593 $ $ ! $ 63,008 8,492 23,793 95,293 $ $ ! $ 68,201 9,422 21.522 99,145 $ $ ! $ 72.320 12,101 17,014 01,435 $ $ ! $ Sign & Fence Permits Miscellaneous Planning 5 4 of 0.00% 4.06% $ $ 8,701,865 $ $8,873,394 $. 8,362,474 $ $ 7,900,116 $ $ 7,845,546 $ $7,635,252 72,205 $7,778,574 $ Unallocated Total Expenditures ~3/2005 5 5 of Comments Budget % Revised Incr/(Decr) 2002 2003 2004 2005 2005 2006 2006 Over Actual Actual Actual Est Actual Budget Budget Budget 2005 Budget Other Financing Uses Capital Outlay $ 1,155 $ $ $ 15.000 $ $ $ 0.00% Transfers $ 19.192 $ 15.953 $ 294,648 $ 415.953 $ 417,000 $ 17,000 $ 17.000 -95.92% Total Other Financing Uses $ 20,347 $ 15,953 $ 294,648 $ 430,953 $ 417,000 $ 17.000 $ 17,000 -95.92% Contingency $ 20,148 $ 102,527 $ 18,760 $ 100,150 $ 150,000 $ 79,894 $ 175,000 16.67% Grand Total Expenditures $ 7,819,069 $7,753,732 $ 8,158,954 $ 8,431,219 $ 8,929,474 $ 8,970,288 $ 8,893,865 -0.40%