5.1. SR 09-08-2008 - Laserfiche WebLink

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Each $100,000 levied increases the tax rate by .384. If the Council wanted to increase the levy by $100,000 to help eliminate the budget shortfall, the tax rate would increase to 42.878. That option is included in the list of possible budget adjustments to be considered by the Council. As I stated earlier, if the levy is approved based on a three percent NTC increase, there is a $519,850 budget shortfall. The budget requests from department heads were for the most part very conservative with many departments requesting less than a five percent increase even though a three percent cost of living adjustment, five percent cafeteria benefit increase, and substantial fuel and supply cost increases were included. Given the conservative budget proposal, it was more difficult than in the past to identify budget adjustments that do not affect services. That said, we have identified a list of possible budget adjustments that is attached. Some of the adjustments are administrative corrections to match the budget request to actual costs or actual needs. There are also several positions that are currently vacant that may not be filled immediately that have been included as proposed cuts. No new staff or increased hours are included in the proposed budget. Most of the suggested cuts are coming from departments that requested increases in services or that had increases in excess of five percent. The goal in determining possible cuts was based on retaining existing services; the objective is to continue to provide services at existing levels without any visible change to the public. As a result, the most obvious areas to cut are increases in programs and new programs. In addition, at the staff level we have explored every opportunity to increase our efficiency and reevaluate how we do our jobs in an effort to reduce costs, increase efficiency, and provide excellent service to our residents. I have reviewed the proposed adjustments with the affected department heads and in many cases they and their staffs have offered suggestions on possible reductions. Reducing an already fiscally sound budget is difficult as you can tell by the list of possible adjustments. In addition, if the Council chooses to include the TIF error in the tax rate of 42.494, an additional $87,210 in cuts are necessary. Finance Director Tim Simon and I will be prepared to review this information in detail at the work session. Obviously, many of the proposed budget adjustments will generate Council discussion and will require difficult decisions to be made by the Council. Attachments • 2009 General Fund Budget — List of Possible Adjustments • Resolution Authorizing the Proposed Property Tax Levy for Collection in 2009 • General Fund budget summary • Letter from County Auditor Diane Arnold on TIF adjustment • Minnesota Statute regarding correction of errors for TIF districts • 2008 year to date General Fund revenue and expenditure summary Action Follow M Motion by Second by Vote S:ACouncil\LoriA2008\Budget Discussion 09 08 08.doc