12-09-2019 Council Packet - Laserfiche WebLink

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General Fund Budget General Fund Expenditures The 2020 expenditure budget is $9,143,200 which is an increase of $ 565,920 (6.6%) over the 2019 budget. The preliminary budget that is being presented for approval tonight includes expenditures totaling $9,143,200; an increase in expenditures of $565,920 (6.6%). The significant increases are the following. Wages and Benefits (Personal Services) are increasing $296,160 (5.4%). Insurance expenditures are another category that is increasing significantly (30.5%). This $37,500 increase is due to two factors: one is a change in our loss ratio due to land use lawsuits, and the other is a continuation of a trend of increasing costs related to police departments. There were two changes in accounting practices that increased the General Fund budget, but did not increase overall spending. The first was to move $80,000 in street maintenance from the Pavement Management Fund to the General Fund. The Associated tax revenue was also moved to the General Fund. The other change was to the accounting for the Toward Zero Deaths Grant. This increase of $119,500 is completely offset by an increase in amount of grant revenue recorded. After accounting for these increases, the remaining General Fund increases total $32,760 or 0.3%. General Fund Revenues For revenues the General Fund budget also totals $9,143,200 and is increasing by $565,920. The largest increase in revenues is the property tax line at $299,000. Other significant increases include $125,000 in the State Grant line item which was also discussed in the expenditure section. Administrative Fees charged to the utility Funds are increasing by $38,000 and are based on a percentage of the Finance and Administration budgets. Coop Police Services are increasing by $57,170 and are the amounts charged to the City of Spring Park, Minnetonka Beach and Mound for providing them police services. All other revenue changes total $46,750 and represent 0.5% of the revenue budget. Special Revenue Funds The special revenue funds that budgets are adopted for are the Park Fund, The Drug Forfeiture Fund, and the TIF Fund. Special revenue funds by definition have a primary source of revenue that is dedicated for a specific purpose. In the Park Fund the primary revenue source is park dedication fees collected from developers. By state law, these funds must be used for parkland acquisition and development. The Drug Forfeiture Fund receives its primary funding from the Police Department's drug and alcohol enforcement activities. The funds must be used for drug and alcohol related activities. The TIF Fund is used to account for revenues related to the Orono Woods Senior Housing Development. Debt Service Levies The 2020 levy for debt service is $711,000. This levy is used to pay the debt service on the City's outstanding bonds. Enterprise Funds The Water, Sewer, Stormwater, and Recycling Funds are designed to account for the business type activities of the City. These funds do not receive any property tax revenue. The goal for the Enterprise funds is to be fully funded by rates without depending on special assessments for infrastructure improvements. While there is no formal adoption of the expenditure budgets, the information is included in the budget book. On the revenue side of the budget, the utility rates are approved annually as part of the fee schedule. City of Orono - 2020 Budget Page 4