06-22-2020 Council Packet - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, June 8, 2020 6:00 o’clock p.m. _____________________________________________________________________________________ Page 5 of 21 for Service is $150,000 less. Looking at the bottom line, on May 31, 2019, the City was at 22.5% of budget; this year, on May 31 the City is at 18.28% of budget. He noted COVID-19 and the economy feeling the effects of a shutdown as the reasons for the decrease. He stated the property tax settlements are not shown on the information. The City will receive its first portion of property tax in about two weeks; it will be 70% of the collections through May 15 and will give the City a glimpse into how property tax collections are going. He referenced the year 2008, when the housing market bubble burst and collections went down; the City dropped to about 97% of budget instead of around 99% of budget. If that happens this time, $150,000 would not be collected this year. Walsh noted the City always gets their money, although sometimes it comes later. He pointed out that even though it looks like Licenses & Permits is $50,000 less and Charges for Service is $150,000 less, in 2019 the City was way over budget in terms of revenue. Even though the first quarter was very slow and the second quarter does not quite make up for it, this year the City is at 45% and 41%. For perspective, the City may be down from last year, but the City was way over budget in terms of revenue. Olson stated five months is 42% of the year, so even on the Charges for Service, it is targeted to be on budget. He remembers when the budget was being set, the revenue budget for Permits and Charges for Services was increased a little. Johnson had asked how far the City could go, and he had said the City was in good shape raising the number this much. However, he never anticipated COVID-19 or the unrest the last couple of weeks, all of which causes people to worry which leads them to potentially not spend money. Walsh stated the City needed more developers to come in and build houses. Johnson said he thought there were quite a bit of renovations going on which is less in permitting dollars. They are a placeholder for what people think they can do. He stated there will be a rebound. Walsh said the City is in good shape. The City has been calm in how they have approached the budget and is still above percentage in terms of the year and have not yet hit the great months: July, August, September, and October. Crosby said he thought the momentum would start to pick up in the third quarter. Olson noted the graph being shown is another way to look at building permits. He indicated the brownish- orange color is 2020 and is lagging behind. Johnson asked if those numbers were in dollars. Olson stated the graph reflected dollars. Johnson asked if Olson had the unit numbers. Rief said that information was in a report he had submitted earlier. Johnson stated that is the renovation permit. Olson said that is what happened in 2008; there was maybe a decrease in new construction but lots of remodels. He said it is hard to predict absolutely what will happen. The City has a pretty robust base, and