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Item No.: <br />Date: September 24, 2018 <br />Item Description: Adoption of 2019 Preliminary Tax Levy <br />Presenter: Ron Olson Agenda Finance Director <br />Finance Director Section: Report <br />1. Purpose. The purpose of this agenda item is adopt the 2019 Preliminary Tax Levy. <br />2. Background. By State Law the City is required to adopt a preliminary property tax levy by <br />September 30th. The City is also required to specify the date of the Truth in Taxation (TNT) meeting is <br />held. <br />The property tax levy has three components. The first is the operating levy which is adopted to fund the <br />General Fund Operating Budget. The second part is the Pavement Management Levy that is needed to <br />fund the City's pavement maintenance plan. The final levy component is for the debt service of the <br />City's outstanding bonds. The breakdown of the tax Levy is as follows. <br />General Fund - Operating $4,380,000 <br />Pavement Management $544,450 <br />Debt Service $711,000 <br />$5,635,450 <br />When compared to the 2018 tax levy, the 2019 levy is increasing by $195,499 or 3.6%. With the levy for <br />the General Fund only increasing 0.8% and the Debt Service Levy staying level, the majority of the <br />increase in in the Pavement Management Fund. This increase reflects the City's desire to have a fully <br />funded road program. Exhibit A illustrates the relatively flat General Fund levy with the increases in the <br />overall levy in recent years being the result of catching up on road funding. The Debt Service Levy will <br />remain at $711,000 until the 2023 levy year. That year the levy for debt will decrease by $294,470 to a <br />total of $416,530. Even with the increase in this year's levy, the City's Tax capacity Rate will remain at <br />16.55% which is the third lowest in Hennepin County. <br />3. Staff Recommendation. Staff Recommends approval of the 2019 Preliminary Tax Levy and to set <br />the 2018 TNT meeting for regularly scheduled meeting on December 10, 2018 at 6:30pm. <br />COUNCIL ACTION REQUESTED <br />A motion to adopt the attached resolution adopting the 2019 Preliminary Tax Levy and set the TNT <br />meeting for December 10" at 6:30. <br />Exhibits <br />Exhibit A. Levy Graph <br />Exhibit B. Debt Schedule <br />Exhibit C. Resolution <br />Prepared By: *I <br />Reviewed By: -Sbja <br />Approved By: 5b)X <br />