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$0Transfer45% PIF TransferBudgeted TransfersOperating Income Park Improvement Funding$1,200,000$1,000,000$800,000$600,000$400,000$200,000$0$350,000$300,000$250,000$200,000$150,000$100,000$50,000
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<br />201220132014201520162017201820192020
<br />Operating Income$916,354$1,049,821$1,048,469$1,029,210$945,652$921,015$969,455$1,066,993$1,023,296
<br />Budgeted Transfers$360,157$422,000$391,013$399,050$438,950$482,850$492,000$500,000$500,000
<br />45% PIF Transfer$250,289$282,519$290,668$265,617$228,016$197,174$214,855$255,147$235,483
<br /> Property/liability rates are expected to remain flat, but premiums are affected by other factors such as
<br />property values, changes in expenditures, experience rating, and other exposure measures.
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<br />Changes in Net Tax Capacity
<br />Early spring estimates from the county indicate residential market values increasing approximately 7% and
<br />commercial/industrial values increasing about 1%, which should result in a NTC increase of roughly 6% or
<br />about $1.7 million additional tax capacity.
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<br />The attached graphical illustrations show the trends in the general fund budget, tax levy, tax capacity, and tax
<br />rate over the past ten years. Also attached for consideration this year is a schedule of the debt service levies
<br />needed to fund the principal and interest payments on the city’s general obligation debt, which does not include
<br />the YMCA, Sales Tax Revenue, or Sewer Revenue bonds.
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<br />Park Improvement Funding (PIF)
<br />The PIF transfer from the Liquor Fund is calculated and made after the prior year’s audit is complete. The
<br />funding policy was briefly discussed during a budget meeting last year for potential revision.
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<br />The PIF policy was adopted in 2008 and revised in 2012. The current policy states: The city may utilize up to 45% of
<br />operating income less budgeted transfers from its municipal liquor stores to fund a Park Improvement Fund. The amount will be
<br />calculated after the prior year’s audit is complete and will be subsequently transferred via resolution from the City Council.
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<br />When the policy was updated, the expected transfer amount was $250,000. In recent years, the transfer varied
<br />and was significantly less than expected due to the calculation method outlined in the policy. The calculation is
<br />no longer conducive to the PIF transfer and has been affected by required GASB audit adjustments to operating
<br />income and fluctuations in budgeted transfers. This makes it difficult to properly plan park improvement
<br />projects when the funding amount is unknown.
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<br />Based on the initial PIF funding expectations to provide stability and allow for the accumulation of resources, it
<br />is proposed to revise the current Park Improvement Fund policy as follows:
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