8. Discussion on the 2017 Operating and Capital budgets and 2017 property tax levySCA►NDIA.
Staff Report
Date of Meeting: September 7, 2016
To: City Council
From: Neil Soltis, Administrator
Re: 2017 Tax levy and Operating and Capital budgets
Background: Based on the input from the August City Council work session, the preliminary
2017 budget has been recast. Items added to the budget included the following:
• Update of the Comprehensive Plan ($56,000 — 80% of estimated cost),
• Upgrades to the City website ($3,000),
• Purchase of data technology equipment including a firewall appliance, a gigabit Ethernet
switch, and a new server ($11,700)
• Adding of layers to the City's GIS system and upgrading the GIS for access from mobile
devices, ($3,000)
• Purchase of a used roller for road patching ($8,000)
• Levying funds for the EDA to utilize for matching grant or loan programs ($5,000)
Additionally, based on the savings from the 2016 road project and projected revenues and costs
for future road projects, the levy for the local road improvement fund was reduced by $56,000
so those funds could be used for the update of the Comprehensive Plan.
Incorporating these changes and the other budget assumptions that were discussed at the
August Work Session, the City's 2017 tax levy would be $2,227,507. This is a decrease of
$30,365 from the 2016 levy. The decrease is largely attributable to the reduction in the funds
needed for payments on the City's outstanding debt obligations from debt being retired in
2016.
Issue: Are any additional elements that need to be factored in or adjusted in advance of the
Council approving a resolution on the minimum levy rate for 2017.
Proposal Details: The preliminary levy for taxes payable in 2017 must be certified to
Washington County and the date of the public hearing must be set no later than September
30th. The recommended property tax levy would be preliminary, to be used for the property
tax notices that will be sent in November. The Council may make additional changes to the
budget prior to its adoption in December, but the tax levy may not be increased.
Fiscal Impact:
Fund 2015 budget 2016 Budget 2017 Proposed
General Fund
$
1,564,818
$
1,498,148
$
1,551,768
Debt Service Fund
$
272,691
$
148,582
$
116,739
Capital Improvement Fund
$
30,000
$
30,000
$
30,000
Local Road Improvement
$
345,000
$
581,142
$
524,000
Economic Development
Authority
$
2,500
$
-
$
5,000
Total Levy $ 2,215,009 $ 2,257,872 $ 2,227,507
The total levy would decrease by 1.3%. The increase in the levy for the General Fund is
attributable to the additional funds that need to be provided for the work on updating the
City's comprehensive plan. See the attached summaries of the preliminary revenue and
expenditure budgets for 2017 and projections of the 12/31/2017 funds balances.
Options:
1. Recommend preparing the levy resolution based on the previous discussion
2. Hold a special meeting to discuss additional changes to the budget and levy amount
Recommendation: Option 1
2014 2015 2016 2017
Tax Levy for Local road Improvement Fund $ 127,704 $ 345,000 $ 581,142 $ 524,000
TAX LEVY
$2,500,000
$2,000,000
$1,500,000
$1,000,000
i
$500,000
$
2013 Actual
2014 Actual
2015 Actual
2016 Projected
2015 budget
2016 Budget
2017 Proposed
■ Economic Development Authority
$-
$1,000
$5,000
$-
$5,000
$-
$5,000
■ Local Road Improvement
$-
$-
$345,000
$581,142
$345,000
$581,142
$524,000
s Capital Improvement Fund
$91,296
$222,104
$30,000
$30,000
$30,000
$30,000
$30,000
■ Debt Service Fund
$343,003
$327,506
$272,691
$148,582
$272,691
$148,582
$116,739
■ General Fund
$1,736,775
$1,620,464
$1,569,818
$1,435,863
$1,564,818
$1,498,148
$1,551,768
2014 2015 2016 2017
Tax Levy for Local road Improvement Fund $ 127,704 $ 345,000 $ 581,142 $ 524,000
GENERAL FUND SUMMARY
$2,500,(
$2,000,000
$1,500,000
$1,000,000
$500,000
$ 2013 Actual 2014 Actual 2015 Actual 2016 Projected 2015 Budget 2016 budget 2017 Proposed
Fund balance - 12/31 $1,594,415 $1,715,890 $1,746,587 $1,481,279 $1,523,793 $1,393,396 $1,087,798
■ Revenue $2,170,437 $2,070,197 $1,944,186 $1,769,630 $1,795,244 $1,748,439 $1,944,186
■ Expenditures $1,905,575 $1,948,722 $1,913,489 $2,034,938 $1,987,341 $2,101,630 $2,337,668
2015 2016 2017
Transfer to Local road Improvement Fund per Fund Balance Policy $ 335,932 $ 347,724 $ 523,200
GENERAL FUND REVENUE SUMMARY
$2,500,000
$2,000,000 ■
$1,500,000
$1,000,000
$500,000 -
$ 2013 Actual 2014 Actual 2015 Actual 2016 Projected 2015 budget 2016 Budget 2017 Proposed
■ Other Financing Sources $7,042 $- $- $- $- $- $-
■ Other Income and Transfers in $30,075 $40,369 $46,603 $18,600 $19,458 $14,000 $16,500
■ Fines & Forfeitures $11,534 $13,468 $12,711 $12,000 $12,000 $12,000 $12,000
■ Charges for Service $229,801 $230,767 $67,281 $62,567 $62,204 $69,048 $68,100
• Intergovernmental Services $43,083 $53,530 $83,337 $52,900 $34,732 $42,146 $53,900
■ Licenses and permits $100,007 $90,704 $138,741 $165,900 $80,230 $91,295 $90,400
■ Other Taxes $14,414 $17,249 $38,864 $21,800 $21,802 $21,802 $21,800
0Property Taxes $1,724,724 $1,633,710 $1,583,779 $1,435,863 $1,564,818 $1,498,148 $1,551,768
The increase in Contractural Services expenditures relates to the Comprehensive Plan
GENERAL FUND EXPENDITURE SUMMARY BY OBJECT
$2,500,000
$2,000,000
$1,500,000
$1,000,000
-
$500,000
-
$
IL
2013 Actual
2014 Actual
2015 Actual
2016 Projected
2015 budget
2016 Budget
2017 Proposed
■ Transfers
$99,900
$300,000
$356,522
$347,724
$220,000
$347,724
$523,200
■ Personal Service
$529,128
$559,416
$568,674
$607,300
$611,927
$619,021
$628,888
Capital Outlay
$84,212
$4,716
$18,525
$12,800
$6,700
$13,000
$15,700
■ Contractual Services
$1,014,750
$905,138
$895,284
$921,464
$954,683
$936,630
$983,980
■ Materials & Supplies
$179,044
$179,526
$101,869
$145,650
$194,031
$185,255
$185,900
The increase in Contractural Services expenditures relates to the Comprehensive Plan
GENERAL FUND EXPENDITURE SUMMARY BY DEPARTMENT
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$--E 0 0 9 0 0
2013 Actual 2014 Actual 2015 Actual 2016 Projected 2015 budget 2016 Budget 2017 Proposed
■ Public works $847,491 $1,055,613 $1,029,107 $1,126,124 $1,039,155 $1,197,153 $1,367,191
■ Community Center $36,808 $42,439 $37,759 $37,300 $39,480 $40,261 $38,100
■ Parks & Recreation $59,385 $59,802 $56,589 $55,000 $62,244 $60,879 $62,500
■ Fire $276,840 $258,138 $224,038 $222,846 $271,515 $232,959 $234,200
■ Police $116,384 $121,113 $115,642 $116,200 $120,989 $116,197 $120,500
Planning & Building $204,125 $71,066 $105,206 $117,400 $71,700 $96,206 $153,000
■ Elections $470 $5,827 $1,172 $6,150 $470 $6,150 $1,300
■ City Council $17,801 $18,406 $19,578 $26,500 $20,121 $26,976 $19,462
■Administration & Finance $347,730 $316,393 $351,783 $327,418 $361,667 $324,849 $341,415
The increase in Planning expenditures relates to the Comprehensive Plan
Public Works Expenditures includes the transfer to the Local Road Improvement Fund
DEBT SERVICE
FUND SUMMARY
$900,000
$800,000
$700,000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$
2013 Actual
2014 Actual
2015 Actual
2016 Projected
2015 Budget
2016 budget
2017 Proposed
Fund Balance
$285,595
$319,120
$113,260
$111,701
$361,224
$120,424
$36,251
Revenue
$120,889
$837,493
$293,585
$185,539
$304,944
$193,902
$130,971
Expenditures
$89,309
$803,968
$531,093
$187,098
$296,628
$186,738
$206,481
LOCAL ROAD IMPROVEMENT FUND
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$ 2013 Actual 2014 Actual 2015 Actual 2016 Projected 2015 Budget 2016 budget 2017 Proposed
Fund Balance $- $328,137 $402,956 $319,822 $323,637 $102,322 $1,444,522
Revenue $- $328,137 $703,246 $956,866 $545,500 $949,366 $1,124,700
Expenditures $- $- $628,427 $1,040,000 $550,000 $1,250,000 $-
The current Capital Improvement Plan calls for the reconstruction of Old Marine Trail in 2018 at a cost of $800,000. This work can be extended to
Oxboro is funds additional funds are available.
OTHER CAPITAL FUNDS
$900,000
$800,000
$700,000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
2013 Actual 2014 Actual 2015 Actual 2016 Projected 2015 Budget 2016 budget 2017 Proposed
$(100,000)
YEAR END FUND BALANCE
2015 1 2016 1 2017
Capital Improvement Fund - $30,000 levied annually, most funding through issuance of
debt
! $
356,058 $
384,688 $ 282,988
Park Capital Fund - Park dedication fees used to repay loan from Capital Improvement
fund, other projects 100% funded by donations
i
I
; $
I
(19,812); $
I
(19,362); $ (9,892
Equipment Replacement Fund
I
; $
I
470,608 ; $
I
385,258 ; $ 276,552