6.1. SR 12-05-2011 - Laserfiche WebLink

Home Browse Search

~~ REQUEST FOR ACTION R~.ver TO ITEM NUMBER Ma or and Ci Council 6.1. AGENDA SECTION MEETING DATE PREPARED BY Administration December 5, 2011 Tim Simon, Finance Director ITEM DESCRIPTION REVIEWED By 2012 Budget and Tax Levy Presentation; Public Comment; Cal Portner, Ci Administrator Consider Resolution Adopting Final Tax Levy for Taxes Payable REVIEWED BY in 2012; and Consider Adoption of 2012 Budget ACTION REQUESTED • Adopt the resolution authorizing the property tax levy for collection in 2012 • Adopt the 2012 General, Special Revenue, and Enterprise fund budgets BACKGROUND/DISCUSSION In May, city departments began working on the 2012 department goals and the requested budget. Starting in June, staff met with Council to discuss in detail those 2012 goals and the expenditure detail. Based on Council review and discussion with staff, the budgets were adjusted and amended. In September, the Council approved the proposed tax levy that was used to calculate the city tax for the proposed property tax notice that was mailed to each property owner on November 21. As the Council is aware, the final levy may be less than, but may not be more than, the levy approved in September. In October and November, budget adjustments were discussed to reduce the levy from the proposed levy adopted in September. At the November 21 Council meeting, the Council discussed adjustments resulting in a proposed $12,678,050 General Fund budget. Tax Lew The maximum tax levy proposed for 2012 was $11,112,391. On November 21, the Council considered options to reduce the levy to $10,275,815 which is $836,5761ess than the 2011 tax levy. The preliminary estimated Net Tax Capacity (NTC) decreased by 11.07 percent to 21,612,212 for taxes payable in 2012. Last year the NTC decreased 2.91 percent. The main reason for the large decrease relates to 1) market value decreases and 2) market value exclusion. The final NTC will change slightly as the county makes final corrections and adjustments before calculating taxes in early 2012. The tax rate based on the maximum tax levy is 51.4 percent. Based on the revised levy that the Council will consider, the rate will be approximately 47.5 percent. There are three main entities: the county, school district, and city, that each receives part of the property taxes paid by property owners. The city receives approximately 33 percent of the total property tax the property owner will pay. The balance, approximately 67 percent, goes to Sherburne County, Independent School District 728, Regional Rail Authority, Economic Development Authority, and Housing Redevelopment Authority. Additionally, the State of Minnesota also receives part of the property taxes on commercial and industrial property, the city's share percentage decreases below 30 percent for those properties that pay state tax. rl~wEaE~ ~r N:\Public Bodies\City Council\Finance\Tim\2011\2012budget12052011.docx ~~„°