Financial Management PlanCITY OF HOPKINS
Date: January 9, 2014
To: Mayor & City Council
From: Christine Harkess, Finance Director
Subject: Financial Management Plan
FINANCE DEPARTMENT
Stacie Kvilvang, Financial Advisor with Ehlers will be here Tuesday to discuss updates to the
Financial Management Plan.
We are at the point where we need to start making some decisions on how we would like to
proceed so that a final plan can be drafted for council approval. Once that is done we will
implement the plan for the 2015 budget, annually update the plan and use this as a roadmap for
future budgeting.
The attached power point details the changes that have been incorporated since the original plan
was presented to you. The largest change is that $6.3 million in street projects have been added
to the plan. These projects with one exception were not in the 2014-2018 CIP that was adopted
last summer and will need specific council approval before we move forward with them.
Detailed below are the projects that have been added to the Financial Management Plan:
2014 West Park Road/21 s` Ave
$ 750,000 (in CIP for 2014)
Hobby Acres & Trail
$ 886,000
Zion Lutheran Parking
$ 249,000
13th Ave Drainage
$ 121,000
2015 Mainstreet 5a' to 13`s
$3,080,000
Mainstreet 13'h to Shady Oak Rd
$1,251,000
TOTAL
$6,337,000
All projects have several funding components. The amount that would affect the tax levy if all
projects were done is $3,878,650.
Assumptions In Plan
1. Revenues (market value) increases starting in 2014 by 1%
ann�
— Have accounted for new development/redevelopment
2. Expenses increase at 3% annually
3. All current CIP, parks, equipment, streets, EDA, HCA and ice
arenareended as requested by department heads (including
staffing needs)
— Added total of $6.3Million in street projects in 2014 and 2015
4. HCA is no longer funded by EDA fund ($61,000/year) and tax levy
is added to repay HCA negative fund balance
— Positive fund balance in 2021 (pushed out 1 year)
5. Fund balances
— Capital equipment is $750,000 or one year of costs
— Capital improvements is $300,000
— General Fund is 42% + of expenditures per policy
6. Average value home is $225,000 which equates to $210,450
taxable value 0 EHLERS
01/10/2014
1
General Fund Budget At Last Work Session
TOTAL REVENUE 10,580,329 10,906.129 11,314,213 11.712,139 12.080,203 12,418,710 12.—,911 13,168310 13,580,059 13,963.561 10,379,168
TOTAL EXPENSES 10.90,329 10,996,129 11,314,213 11,)1;135 12,060,203 12,418,710 IZ787,811 13.168,310 13,69,09 13,883,681 14,3]9,188
REVENUE OVER (UNDER) EXPENSES - - - -
Eneln0Fon5Bal9noa 6,181,14] 6,194,193 6,190,193 5,194,143 6,194,141 6,I91,143 6,1%,1p 6,184.143 6,194,193 6,194,143 6,194,143
FUM Balance ae a %ol Annual Exparow 49% 47% 46% 44X /3% 42% 11% 39% 38% 31% 38%
TAXRATEONTm C- c- 82.414% 52.412% 88.320% 12.395% 74.308% 18.981% 80.149% 81.420% 83.341% 65745% 9.835%
TAXRATE%CHANGE 8.31% 000% 9AT% 50896 2.13% 282% 482% 10096 2.38% 407% -3.9%
City Taxe9999r MVNC or Exclotlon $1,29 $1,298 $1,938 51,91 31,602 21.888 51,181 $1,811 51,91 51,981 51,932
%fax lncraaw on araOa Boma (229) 8.37% 0.00% 10.16% 7.21% 393% 4.Oi% 6.04% 2.83% 3.54°/ 5.28% -2.
M9ual Tax lncnwx 376 9 111— $104 361 $80 $101 360 564 $99 -348
1. 2015 tax increase was estimated to be 140
2. Average tax increase over next 9 years is 70
3. Council requested staff work to revise to reduce this impact
EHLERS
What we did to reduce the impact
1. Lowered annual debt levy for various bonds
2. Adjusted annual levy for PIR fund
✓ Lower in early years and higher in later years
✓ Still meets all funding needs
3. Adjusted annual levy for Arts Fund
✓ Lower in early years and higher in later years
✓ Still meets all funding needs
4. Adjusted annual levy for Capital Fund
✓ Lower in early years and higher in later years
✓ Still meets all funding needs
14 111:. I.- —, I
46; EHLERS
01/10/2014
N
General Fund Budget - Today
TOTAL REVENUE
10,580.329 10.946.129 11.274213 11,712.139 12,060.203 12,498,710 12.937.971 13.393,310 13,785059 14188,561 14.804.188
TOTAL EXPENSES
10.580,329 10,948,129
11,274213
11,712,138 12,080,203
12,488,710 12,937,071 13,393,310
13,785,0% 14188,561
14804,168
REVENUE OVER (UNDER) EXPENSES
- -
-
- -
- - -
-
Entling Funtl Balance
5,184143 5,184143
5,194143
5,194143 5,194143
5,2]4,143 5,424143 5,849,143
5,874143 6,099,143
6,324143
I Bnl-- a% of Annual Expanses
49% 47%
46%
44% 43%
42% 42% 43%
43% M%
44%
TAX RAM06IT"(3APACITY
62.414% 62412%
66.420%
70.347% 74.158%
77.900% 81.584% 85.0 63%
X 496% 91874%
N(X17%
TAX RATE%CHANGE
6.37% 0.00%
8.42%
561% 542%
5.0% 4.70% 4.29%
4041 3.82%
-3.03%
CITY T-111,
azaa11,288(22%)
(22%)
6.37% 0.00%
7.68%
7.16% 865%
6.28% 5.92% 555%
5.24% 5.02%
1. 2015 tax increase reduced by $40 to 100
2. Average tax increase over next 9 years is 100
{
0i EHLERS
City of Hopkins
Projected City Impacts
$225,000 Single Family Residence -Inflated at 1% Annually
$2,500
$1.000
$1.500
'.. $1.000 _.... __...
$500
so
2013 2014 2015 12016 2017 2016 2019 7020 2021 2022 2023
C IV laves$1,298 51.298 $1 198: $1,498 51.59751.6981 $1,798 S1,898 $1,99e $2,098$2.058
r
Average City Tax increase of $100 City Tax Reduction of 40
01/10/2014
3
2015 Levy Increase
Use
General Fund
Dollar Increase
$535,076
Tax Increase
$50
Arts Fund
$85,000
$13
Capital Fund
$53,000
$8
PIR Fund
$126,600
$19
Pavillion
$65,000
$10
TOTAL
$864,676
$100
Tax Impact on Average Value Home
Annual Monthly Daily
$100 $8.33 $0.28
EHLERS
2015 Tax Impact of Levy Increase On Property
Tax Increase
Property MarketValue
100,000
$47.34
125,000
$59.17
Residential 150,000
$71.01
Homestead 175,000
$82.84
Average taxable 200,000
$94.68
value in City 210,450
$99.63
250,000
$118.35
300,000
$142.02
400,000
$189.36
500,000
$437.89
Commercial/ 750,000
$674.58
Industrial 1,000,000
$911.28
1,500,000
$1,384.67
2,000,000
$1,858.06
EHLERS
01/10/2014
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01/10/2014
4
Next Steps
1. Input and additional revisions as requested
2. Presentation at Council meeting on finalized plan
3. Utilize the FMP as part of the 2015 budgeting process
4. Update annually as assumptions change
1. Market values
2. Projects
3. Expenses
4. Other revenues
0
EHLERS
01/10/2014
5