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9.a 2024 Budget Presentation2024 Preliminary Budget AUGUST 2, 2023 Discussion Items Proposed 2024 Proposed Capital Improvement Plan. Brief Introduction to the proposed 2024 General Fund Budget Review of CIP and budget impacts Council is encouraged to ask questions, offer comments, and suggest changes at anytime KM1 Slide 2 KM1 Test Kyle Morell, 7/5/2023 Capital Investment Committee Recommendations Establish consistent annual levy-supported cash contributions to call Capital Improvement Funds Utilize excess unassigned 2022 fund balance to complete park projects in 2024 Consider bonding for a significant road project in 2024 Issue equipment certificates for public works and fire department vehicle purchases 2024 Capital Improvement Fund - 401 Beginning Fund Balance $603,601 Revenue Levy $300,000 Interest $3,000 Total $303,000 Expenses Broadband $250,000 Bliss Stormwater $160,000 Warming House Door Locks $17,548 City Office/Equip Room Update $30,000 Total $457,548 Revenue Over/(Under)Expenses ($154,548) Ending Fund Balance $449,053 $300,000 tax levy to support recommended projects Four projects totaling $ 457,548 Fund Balance will be used to make up the shortage Ending Fund Balance of $449,053 2024 Capital Improvement Fund - 404 2023 - Transfer of Unassigned Fund Balance ($200,000) will provide a one- time revenue increase for 2024 projects $60,000 tax levy to support recommended projects Two projects totaling $ 300,000 Ending Fund Balance of $42,372 Beginning Fund Balance $277,306 Revenue Levy $60,000 Interest $66 Misc. Revenue $5,000 Total $65,066 Expenses Hockey Rink Boards $175,000 Tennis Court Improvements $125,000 Total $300,000 Revenue Over/(Under)Expenses ($234,934) Ending Fund Balance $42,372 2024 Capital Improvement Fund - 406 $125,000 tax levy to support recommended projects Five purchases totaling $ 951,356 Equipment Certificate issued for $640,000 New debt levy of approximately $75,000, starting in 2025 until 2035 Ending Fund Balance of $19,717 Beginning Fund Balance $205,028 Revenue Levy $125,000 Interest $1,045 Total $126,045 Expenses 2003 Tanker 2 Replacement $425,000 2017 Plow Truck Replacement $325,000 New Holland Skid Steer $90,000 F-550 Replacement $84,356 Assorted Equipment Attachments $27,000 Total $951,356 Revenue Over/(Under)Expenses ($825,311) Other Bond Proceeds $640,000 Ending Fund Balance $19,717 2024 Capital Improvement Fund – 408 $400,000 tax levy to support recommended projects One street reconstruction project totaling $ 3,575,000 New GO bond issued for $4,000,000 New debt levy of approximately $385,000, starting in 2025 until 2040 Ending Fund Balance of $1,148,471 Beginning Fund Balance $305,866 Revenue Levy $400,000 Interest $10,705 Intergovernmental $6,900 Total $417,605 Expenses Street Reconstruction Project $3,575,000 Total $3,575,000 Revenue Over/(Under)Expenses ($3, 157,395) Other Bond Proceeds $4,000,000 Ending Fund Balance $1,148,471 2024 Preliminary Budget - Revenues Presented budget document includes a column for the previous 3-year average. This is new for the 2024 budget. The General Fund levy is projected to be $1,884,577, a $18,659 increase over 2023, or a 1% increase. Licenses and Permits is projecting an $18,000 increase over 2023, primarily due to an increase in Building Permit fees to be more in line with the historical average Total General Fund Revenue is $2,367,578. This is a 1.53% increase over 2023. 2024 Preliminary Budget - Expenses City Treasurer has indicated she will retire at the end of 2024. The Administrative wages include a replacement, funded for 32 hours a week, with family benefits. Currently, the overlap is budgeted for 3 months. All non-union wages have been increased according to the wage scale The following percentage increases are assumptions. Actual numbers will not be available until later in the year. Union wages were increased by 10% in anticipation of negotiations and due to discussions with the local Union Representative All Health and Dental Insurance line items have been increased by 10% Property and Workers Comp Insurance line items have been increased by 5%. 2024 Preliminary Budget - Expenses Bolton & Menk services have been increased by 5% Policing services have been increased by 8.9% per 2024 Agreement Legal services have been increased to $60,000 to reflect the amount spent through first half of 2023 Public Works include $200,000 for contractual road maintenance and repair. This is in addition to the CIP projects Total expenses are $2,283,408. This is a 4.16% decrease over 2023 (2023 includes a $200,000 transfer of Unassigned Fund Balance to Parks Fund). General Fund Budget Summary 2023 2024 Difference Total General Fund Revenue $2,331,815 $2,367,578 $35,763 Total General Fund Expenses $2,382,518*$2,283,405 ($99,100) Revenues Over / (Under) Expenses ($50,703) $84,173 $134,873 * Includes $200,000 transfer of Unassigned Fund Balance to Park Fund Tax Levy Summary 2023 2024 Difference General Fund Levy $1,865,918 $1,884,577 $18,659 Debt Service Levy $406,536 $345,634 ($60,902) CIP Funds Levy $531,103 $890,300 $359,197 EDA Levy $5,300 $5,300 $0 Total Levy $2,803,557 $3,120,511 $316,954 Less Fiscal Disparities ($123,279)($129,454)*($6,175) Total Net Levy $2,680,278 $2,991,056 $310,778 *3-year Average from 2020 - 2022 Tax Rate Summary 2023 2024 Difference Estimated Tax Capacity $10,528,159 $11,114,983 $586,824 Net Levy $2,680,278 $2,991,056 $310,778 Tax Rate 25.458% 26.910% 1.452% Areas to Review Reducing overlap with the new Treasurer would save $5,700 per month. Signing the Organized Collection Agreement with Waste Management would save $9,200 Reducing Capital Project spending would reduce the levy allocated to those funds. Bonding in 2024 has a dramatic effect on the projected 2025 levy. Looking Forward Staff will continue to update projected numbers with actual numbers when they come in. Multiple budget documents can be prepared to show various scenarios if Council wishes to evaluate multiple levy and spending options. Review the Summary Budget document to evaluate the 2024 bonding effect on future budgets and levies. Next budget discussion is scheduled for the Council Work Session on September 6, 2023. Unless Council wishes to call a Special Meeting beforehand.