7.1. SR 12-07-2015 - Laserfiche WebLink

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City of Elk az — River Request for Action To Item Number Mayor and City Council 7.1 Agenda Section Meeting Date Prepared by General Business December 7, 2015 Tim Simon, Finance Director Item Description Reviewed by 2016 Budget and Tax Levy Cal Portner, City Administrator Reviewed by Action Requested Adopt, by motion, the resolution authorizing the property tax levy for collection in 2016. Adopt, by motion, the 2016 General, Special Revenue, and Enterprise Fund budgets. Background/Discussion In May, city departments began working on the 2016 department goals and the requested budget. Starting in June -September, staff met with Council to discuss in detail those 2016 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 (maximum) tax levy that was used to calculate the city tax capacity rate for the proposed property tax notice that was mailed to each property owner in November. As the Council is aware, the final levy may be less than, but may not be more than, the levy approved on September 21. The following is a summary of the 2015 tax levy resolution for taxes payable in 2016 and the budget: ■ The proposed (maximum) tax levy is $10,305,783 which is an increase of 2.88% over last year. The Council has directed staff to draft a final tax leve resolution of $10.171.733 which is an increase of 1.54% over last year. ■ The 2016 General Fund budgeted operating expenditures are $13,664,350 and include: funds for a cost of living adjustment, pension/health insurance changes, and inflationary adjustments. ■ The 2016 budget is adjusted at the request of Elk River Municipal Utilities (ERMU) to record actual electrical expense for non -revenue city buildings with an offsetting revenue transfer and no tax levy impact. Tax Levv On November 2, the Council reviewed budget options and discussed decreasing the final levy for taxes payable 2016 to $10,171,733 which is a 1.54% increase from the taxes payable 2015 adopted levy. The preliminary estimated Net Tax Capacity (NTC) increased by 4.14 percent to $22,313,958 for taxes payable in 2016. Last year, the NTC increased 4.96 percent. The main reason for the change relates to market value increases and new growth. The final NTC will change slightly as the county makes final corrections and adjustments before calculating taxes in early 2016. The tax capacity rate based on the maximum tax levy is 46.60% which is a decrease from 47.19% last year. With the revised levy, if approved, the tax capacity rate will be adjusted downward to approximately 46.00%. P a w E R E U 6 Y NaA f RE]