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4 <br />The city provides a full range of services and amenities including police and fire protection, building <br />safety inspections, planning and zoning, economic development, environmental services, <br />recreation programming, street and park maintenance, and snow removal. The city also manages <br />municipal water, sanitary sewer, garbage/recycling, and electric services. Elk River also owns and <br />operates two municipal off-sale liquor stores, the city library, community event center and over 40 <br />active and passive parks. <br /> <br />The annual budget serves as the foundation for the city’s financial planning and control. The city <br />administrator must prepare estimates for an annual budget and submit them to the city council for <br />approval. The council is required to adopt a final budget by late December for the subsequent year. <br />The budget is prepared by fund, function (e.g. public works), and department (e.g. streets). <br />Department directors are allowed to make administrative budget amendments (excluding personal <br />service and capital outlay) throughout the year if the total department budget does not change and <br />the amendment is approved by the city administrator and finance manager. Budget amendments <br />to the total budgeted expenditures require city council approval. <br /> <br />Budget-to-actual comparisons are provided in this report for each individual governmental fund for <br />which an appropriated annual budget has been adopted. For the General Fund, this comparison is <br />presented as part of the basic financial statements for the Governmental Funds. For other <br />Governmental Funds with appropriated annual budgets, this comparison is presented in the <br />Governmental Fund subsection of this report. <br /> <br />Local Economy <br />The local economy has remained steady as indicated by building permits with a construction value <br />of $72,199,970 issued in 2024. New construction accounts for $23,192,169 and additions/remodels <br />make up the $49,007,801 balance. In 2024, residential growth was stable as the city issued 98 new <br />housing permits, compared to the 93 permits issued in 2023. Single family homes accounted for all <br />of the new permits. The 2024 average home value increased to $358,100 from $340,300 in 2023. <br /> <br />The recent market trend shows stable property values on existing properties and new <br />construction/remodeling. There remains continued interest in both affordable and market rate <br />multi-family housing projects, as well as protecting property values of the existing housing stock. <br /> <br />Many of Elk River’s employers reported stable employment levels during 2024 and are expected to <br />remain stable. This is largely due to the diverse industry sectors of manufacturing, retail trade, <br />government, and health services that drive the local economy within the region. The <br />commercial/industrial sector has experienced modest growth and the economic outlook in this <br />region looks promising with recent development projects that should continue to spur tax base <br />growth and employment. <br /> <br />Long-term Financial Planning <br />The city has developed a financial management plan that provides a long-range forecast projecting <br />future expenditures, revenues, and development. The council diligently maintains a level tax rate <br />and the plan provides the guidance needed to develop and sustain city services while keeping the <br />property taxes stable. The council reviews and updates the financial management plan annually as <br />part of the annual budget and Capital Improvement Plan (CIP) process. The CIP is a comprehensive <br />five-year planning tool that forecasts the city’s capital needs based on the city’s long-range plans, <br />goals, and policies. <br /> <br />Page 194 of 637