3.a) 2010 Levy Limit Estimate � ��
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SC IA
Memo � �
To: Mayor and City Council
From: Anne Hurlburt, City Administrator
Date: July 8,2009
Re: 2010 Budget—Levy Limit Estimate
Minnesota cities must certify a preliminary,maximum 2010 property tax levy by September 15,2009.
The final levy amount certified in December can be less but cannot excced this amount.
The levy will be constrained by the state levy limit. Staffhas prepared a preliminary estimate of the
20101evy limit and how much tax revenue will be available for the city's operations next year.
Final data is not available for certain parts of the levy. For example,we do not yet know the cost of
police services for next year, a portion of which is a special levy. Certain assumptions were made.
Growth in new households and property values aze expected to be zero. The special levy for increased
PERA contributions would remain the same as in 2009,assuming there are no pay increases for
employees. The estimate assumes that the city would claim special levies for the 2008 and 2009 LGA
and MVHC unallotments. It also assumes that the city would levy the minimum debt service levy and
that reserves in the debt service funds would be utilized.
The total maximum ta�c levy for 20l 0 is estimated to be less than the 20091evy by about$23,600,or
-1.27%. After deducting the debt levy,and the projected unallottment of 100%of MVHC aid in
2010,the amount of the levy available for city operations in 2010 is estimated to be$1,514,122,about
$13,000 higher(+0.00881%) than the operating levy budgeted in 2009.
Attachments:
1. Estimate of 2010 Levy Limit
2. Debt Service Schedules
City of Scandia
Estimate of 2010 Levy Limit-July 14, 2009
2010 2009
1. Adjusted levy limit base for pay 2009 $1,293,722
2. Inflation Adjustment (.86%) 1.0086 3.90%
3. Percent change in number of households over last year 0
4. Percent change in total market value of all 0
property types as a result of new construction 0
5. 2010 certified LGA 0
2010 Levy Limit $1,304,848 $1,293,722
*Special Levies 2010 2009
Bonded Indebtedness $247,000 $380,000
PERA Employer Contribution Rate Increases* $4,451 $4,451
Wages & Benefits of Police & Fire Personnel** $182,720 $182,720
To recover LGA unalloted in December 2008 $36,602
To recover MVHC reimbursement unalloted in July 2009 $61,647
Total Special Levies $532,420 $567,171
Total Levies $1,837,268 $1,860,893 -1.270%
Calculation for General Fund Operating Revenue
Total Levy $1,837,268
less debt levy -$247,000
less 2010 MVHC unallotment -$76,146
Total Available for General Fund Operating Revenue $1,514,122 $1,500,892 0.00881
*No increase if no wage increase.
*` Police Wages& Benefits will be slightly higher for 2010.
Waiting for estimated deputy's contract from Sheriff's office.
DMS09 �
CITY OF SCANDIA,MINNESOTA
Sammary of Outatand(ng Bond Issues
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Statutory Total Special Tax Interest Cash
Mo. Year Principal Coupon Interest Payment 5%Cov'g Required __ Rates Assessments (.evies Earnmgs Balance
37R,908
- 20U9 4(,0,000 - 80,098 540,098 27,005 5G7,102 0 81,896 380,000 3J00 276,802
- 2010 225,000 - 64,335 289,335 14,467 303,802 0 31,640 247,000 2,2.19 199,007
- 2011 230.000 - 56,123 286,123 14,3U6 300,429 0 30,2R7 247,000 1,I90 177,85G
• 2012 235,000 - 47,525 282,525 14,126 296,65] 0 28,934 237,000 1,779 148,917
- 2013 235,000 - 38,494 273,494 13,675 287,168 0 27,5g� 237,OU0 1,489 127,819
- 2014 235,000 - 29,313 264,313 ]3,216 277,528 0 26,228 227,000 1,278 1O4,79R
- 2015 235,000 - 19,808 254,808 12,740 2G7,548 0 24,g75 219,000 969 R2,094
- 2016 125,000 - 10,188 135,188 G,759 141,947 0 23,522 110,000 9 -7,532
- 2017 125,000 - S,L25 13U,125 G,506 136,63t 0 22,169 10G,0O0 0 -t5,99n
- 20I8 0 - 0 0 0 0 0 0 0 0 p
2,105,000 351,006 2,456,006 122,800 2,578,807 0 297,133 2,O10,0U0 12,834
�>> (�) (3) (4) (S) (b) ��) �g) (9) (]Ol
(1) Indicates the total Principal payment due annually for all three bond issues.
(2) Indicates the total Interest payment due annuaily for all three bond issues.
(3) Principal and Interest payments due annually for all three bond issues.
(4) Indicates the Statutory 5%debt service coverage requirement for General Ob{igation debt(as per Minnesota Statutes§475).
(5) Combines the Payment and the 5%Coverage columns for total annual payment requirement.
(6) Indicates the annual anlicipated water rates and sewer rates as a revenue source.
(7) Indicates the annual anlicipated special assessments as a revenue source.
(R) Indica�es the annual anticipated tax levies as a revenue source.
(9) Indicates the annual anticipated level of interest eamings(at 1.0%)on the debt service Fund Balance as a revenue source.
(10) Indicates the yearend almual debt service Fund Balance following payment of Principal and lnterest from expected revenue sources.
Northland Securitles,Inc. Dated: 6/12/2009 Page: l
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DMS09
1,200M G.O.Improvement Bonds of 2004(Fund#304)
Callable?
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_Iv1o.:Year� __�Priricipal�•:• �•:Goupon:: ..:•Jriterest��::�:��:�.�: I'apment�::•:•::••:•:5%�oi�g:�.'...•.. Reyuired>:? Year�:..R:ates�.:.::•. .:Assessments . I_e'vies Earfiings 8alailce .
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1 G5,302
R 2009 240,OOU 3.30% 7,920 247,920 12,396 2b0�316 2009 0 48,902 100,000 �164 54,R53
240,000 7,920 247,9Z0 12,396 260,316 0 48,902 100,000 lG4
The Improvement Bonds of 2004 were issued f'or a total Principal amoont of$1,200,000. Final bond payment is scheduled for December of 2009. Bond prceeecls financed tlie 2004
street improvements. The bonds are payable from special assessments,annuai tax levies and are additionally secured by unlimited aA valorem taxes. The early call feature be�;omes
Recommendation: No action on the part fo the City is required with respect to this bond issue.
6RSM G.O.Building Crossover Retunding Bonds of 2005(Fund#310)
CAllable 12-1-13�l00
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Mo..Yea'r.•.;�.:Pr•incipa�, _ :Coup�n�.•..•�.intenes4• :x<•:•.<•Aa.y�ttet[t..�.••..•.•.5./n.Covg•.•:.. .:•Req«ired ::: Year :�.. ..Rafes..... :.Assessin�ts..:.....Lev�es .. Earni►Tgs.:. 6aGan�e .
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l2 2009 85,000 3.35% 26,140 111,140 5,557 116,697 2009 0 0 106,000 1,676 ISR,546
12 2010 90,000 3.50% 23,293 113,293 5,665 118,957 2010 0 0 IOG,OUo 1,5R5 ]47,Un
12 2011 95,000 3.65% 2Q143 115,143 5,757 120,900 2011 0 0 106,000 1,472 133,746
12 2012 100,000 3.80% 16,675 116,G75 5,834 122,509 2012 0 0 10G,000 1,:f37 118,575
12 2013 100,000 3.95% 12,875 112,875 5,644 118,519 2013 0 0 ]OG,000 1,186 107,242
12 2014 1�5,U00 4.10% 8,925 113,925 5,696 119,621 2014 0 0 106,000 1,072 94,G93
12 2015 I10,000 4,20% 4,620 114,620 5,731 120,351 2015 0 0 10G,000 8G8 ft1,210
685,000 112,670 797,670 39,884 837,554 0 0 742,000 9,:L97
The Building Crossover Refimding Bonds of 2005 were issuecl for a total Principal amount of�685,000. Final bond payment is scheduled for Decernber of 2015. Bond t�roceeds refiinded
the 2009 through 2015 maturities of U�e G.O.Building Bonds of 2000(which financal the Fire HalUPublic Works building). The bonds are payable solely from annual tax levies and are
additionally secured by unlimited ad valorem taxes. The early call feature becomes effective December 1,2013.
Recommendafion: Based upoii the currant cash balance,the final tax levy could be reduced to$25,000,still producing a positive cash flow upon final�naturity of this issue. ,
Northland 5ecurities,Inc. Dated: 6/12/2009 Page: 2
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DMS09 •
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1,430M C.O.Improvement Bonds of 2007,Series A(Fund#307)
Callable]2-1-15 @ 100
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[evies . :: ��rnings_ F3�Pance .
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I 2 2009 135,OU0 3.70% 46,038 ]81,038 9,052 190,089 2009 0 32,993 174,600 4G0 63,403
12 2010 135,000 3.75% 41,043 176,043 8,802 1$4,845 2010 0 31,640 141,000 h34 S l,R33
12 2011 135,000 3.80°/n 35,980 170,980 8,549 179�529 2011 0 30,287 I41,000 Sl8 44,110
12 2012 135,000 3.88°/a 30,850 1G5,850 8,293 174,143 2012 0 28,934 131,000 441 30,343
l2 2013 135,000 3.88% 25,619 160,619 8,031 1G8,650 2d13 0 27,581 131,000 303 20,577
12 2014 130,000 4.00% 2U,388 150,388 7,519 157,907 2014 0 26,228 121,000 206 10,105
12 2015 ]25,000 4.00% 15,188 140,188 7,009 147,197 2015 0 24,875 113,000 101 884
12 2016 ]25,000 4,05% 10,188 135,188 6,759 141,947 2016 0 23,522 11U,OU0 9 -7,532
12 2017 125,000 4.1 U% 5,125 130,125 G,506 136,631 2017 0 22,169 106,000 0 _I 5,994
1,180,000 23Q,416 1,4(0,416 70,521 1,480,937 0 248,231 1,168,000 2,673
The Improvement Bonds of 2UU7,Series A were issueci for a total Principal amount of$1,430,000. Final bond payment is scheduleci for December of 2017. Bond proceeds financed
the 2007 road improvement project. The bonds are payable from special assessments,annual tax levies and are additionally secured by tmli�nited ad valorem taxes. The early call
feature becomes effective December 1,2015.
Recommendatfon: A trTnsfer of approximately�54,UU0 from the Improvement Bonds of 2004(to be paid off on 8-1-09)will eliminate the deficit position in 2016 and 2017.
Northland Securittes,lnc. Dated: 6/12/2009 Page: 3
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