5.6. SR 08-08-2005 - Laserfiche WebLink

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2006 Budget August 8) 2005 2 Budget Goals This past April, during a Capital Improvement Program (elP) meeting, a presentation \vas made by representati.\res of Ehlers and Associates, Inc. This presentation \vas an update of tl1e city Financial IvIanagement Plan. One of the operating expense assumptions that \vas discussed at this meeting and that \vas supported by the Council related to equipment certificates. The goal that \"vas discussed is to mo,re the city a\vay from d1.e use of equipment certificates and gradually have all of the annual capital equipment expenditures be in the city general fund budget. .t\chieving this goal will be a major challenge over the next fe\v years. .i\n informal budget goal that the city has al\vays tried to achieve is to keep the tax rate reasonable \vhile continuing to provide quality services and programs. 2006 Revenues With the exception of tax re,renues in the general fund, all of the odler re,Tenues are projected to be very similar in 2006 as to \vhat \vas in the adopted 2005 budget. The Local Go\'ernment .L~d (LG_A.) alnount is identical and the growth related re\renues actually may ha,Te to go do\vn slighrly. This is quite different than \vhat \ve experienced last year \vhen LG.i\ \vent up $393,650 and the grO\vth related re,renues went up $226,400. Not ha'Ting this type of additional re,Tenue a\Tailable in 2006 \vill make balancing the budget a significant challenge. Tax re,Tenues in the general fund are anticipated to increase substantially in 2006 without a tax rate change. Last year dle city Net Tax Capacity (NTC) increased by 16.1 % and dus increase \vas based mainly on ne\v building activities in 2003. The 2006 increase \vill be based on 2004 acti'Tities and 2004 \vas another high grO\vth year for us. At this time the budget proposal sho\vs a 1 O~/O increase in NTC and all R\railable additional tax monies that are not required for debt payments ha-ve been put into the general fund. This equates to approximately $850,000 \vorth of additional tax re,renue for general fund activities \vithout a tax rate change. If \ve use equipment certificates then this additional tax amount tllat is available for general fund acti,rities will decrease; but then, also, some expenditures \vill be remo\red from the general fund budget. I belie\Te that this 100/0 projection is conservati,Te and that the actual increase \vill be in the 140/0 range. This additional re,Tenue \'vill be 'Tery mucll needed in order to balance the 2006 budget. Last year general fund re\Tenues \vent up ahnost 180/0. In 2006 \ve'll be fortunate to go up 100/0. This 1 O~/O figure nearly matches the city grO\vth rate and inflation combined. 2006 Expenditures In keeping \vith Council direction from last year, there ha,Te been \7ery fe\v changes made in the expenditure requests as submitted by dle department and division heads. At this time the proposed expenditures for 2006 are showing an approximately 200/0 increase. i\hnost all of the requested capital outlay items are in the budget and about t\\ro-thirds of the requested staff additions are included in the budget. Attached for your re\rie\v is d1e personnel additions page. This page identifies the positions that are included in tl1e draft budget and \vhich ones I have excluded. This list reflects ffi}T s: \ Council\Pat\Budget\2006 \ 080805 CC F eebackdoc