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4. Staff Report-Budget UpdatesSCANDIA Staff Repovt Date of Meeting: November 10, 2015 To: City Council From: Kristina Handt, Administrator Re: 2016 Budget Changes from 9/2 Meeting Background: The Council set the preliminary maximum levy at $2,257,817 at the Sept 15t' meeting. This was an increase of 1.82% or $40,362 compared to the 2015 levy. Updates: The salary of the new administrator has been updated and health insurance costs have been reduced. This reduced the overall Administration Department budget by $4,792. In order to keep the levy the same as adopted in September, I added the same amount to the Local Road Improvement Fund. Also, since the Council approved the prepayment of the 2007 Road Bond in September and we have received the final invoice, I have updated the transfers to the LRIF to include the remaining fund balance of $32,724. With these changes to the LRIF, the proposed revenue has increased by $37, 516 to $949,366 for 2016. No other changes have been made to the budget. Council member Hegland was going to research the audio equipment for the Council Chambers but we have not yet received an update so it remains in the budget for $8,000. Fiscal Impact: With the proposed 1.82% increase, the City's tax rate will increase 6% from 34.619% to 36.712%. This assumes the 4.3% decrease in market value on residential homestead taxes as provided by Washington County. A home valued at $287,200 for 2016 would see an increase in local taxes of $8.92. A home valued at $400,000 for 2016 would see an increase in local taxes of $17. A home valued at $100,000 for 2016 would see a decrease of $1.94 in local taxes. All of these examples assume the property saw a reduction in value from 2015 to 2016 of 4.3% Next Steps: Provide direction to staff on any further changes that should be made to the budget before the public hearing on December 2°d.