6.0. SR 08-12-2002 - Laserfiche WebLink

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Budget IForksession August 12, 2002 7 the tax rate is due to the public safety building bond. Finally, it should be noted that the tax impact to property owners may be greater if their property value has increased. 2003 Budget Gap The budget gap between available revenues and requested expenditures is $362,100. This budget gap exists even with using the maximum levy allowed by law, reducing the general fund equipment expenditures, and reducing the requested personnel services. We will be able to balance the budget but it will be difficult. There is a concern over using one time revenues to pay for ongoing operating expenses. This is not a good budget practice and it should be noted that we may need to use this approach to balance the 2004 budget as it is expected that the financial conditions will get tougher in the immediate future. Options to close the budget can be discussed in detail at a later meeting but includes: less than a three percent wage increase fewer personnel additions less travel and conferences cutting the supplies and the other services/charges budget categories (or else a maximum percentage increase in these budget categories) reduction in the shade tree program reduction in the street maintenance program [] ° increase in fees eliminate/reduce [] eliminate/reduce o eliminate/reduce eliminate/reduce o eliminate/reduce ° eliminate/reduce the park patrol program seasonal help for mowing and general park maintenance the Lake Orono Association funding request the Boys & Girls Club request the Arts Alliance request the Heritage Preservation request A final item to note, which should get some discussion by the Council is the possibility of a gas franchise fee. This has been discussed from time to time over the years as an alternative revenue source. This money would be available for any city purpose but generally is thought of to be used for street services. The gas franchise with Reliant Energy expires in Spring 2003. A reasonable franchise fee based on either revenues or meters could generate approximately $100,000 annually. The concern is that the same people that pay taxes are also paying the franchise fee, with the exception of non-tax paying entities like churches, schools, and the county. If a franchise fee is to take place, now is the time for discussion prior to renewal of the 25-year agreement. Conclusion I'm not sure how much detail we will be able to get into at the August 12 meeting. Limited details are in this memo and more information can be discussed on Monday. Hopefully, final levy limit information will be available. Also, it is hard to make many budget decisions on the tax levy amount until the county information on net tax capacity is available but it is unlikely that this will be available much before mid-September. It may be that we need a budget meeting in later August and another one in September.