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Prepared By: RJO Reviewed By: DJR Approved By: DJR <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />1. Purpose. The purpose of this agenda item is adopt the 2021 Preliminary Tax Levy. <br /> <br />2. Background. By State Law the City is required to adopt a preliminary property tax levy by <br />September 30th. Once adopted, the preliminary levy may be reduced, but it cannot be increased. The <br />property tax levy has five 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. This levy has been increasing annually as the City moves <br />towards fully funding its Pavement Management Plan. A previous levy for parks is being increased and <br />reinstated. A levy to fund building needs is being instituted. The final levy component is for the debt <br />service of the City’s outstanding bonds. The Debt Service Levy is decreasing by $131,520. The <br />breakdown of the tax Levy is as follows. <br /> <br />General Fund - Operating $4,921,140 <br />Pavement Management $750,000 <br />Building Fund $185,000 <br />Parks $50,000 <br />Debt Service $579,480 <br />Total $6,485,620 <br /> <br />Two resolutions are being presented for the council’s consideration. The first is based on what the <br />information presented to the council at the August 24th work session. When compared to the 2020 tax <br />levy, this levy is increasing by $478,170 or 8.0%. Adoption of this levy would keep the City’s tax rate <br />flat. <br /> <br />The second resolution includes an additional $125,000 of levy in the General Fund. This is resolution <br />was prepared at the Council’s direction in August and increases the levy by $603,000 or 10.0%. If this <br />resolution is chosen, the Council could either pass it as written, or amend it to direct the tax to a specific <br />fund. If it is passed as is, the funds can be transferred to the designated fund as part of the City’s annual <br />operating transfers. <br /> <br />3. Staff Recommendation. Staff Recommends approval of the 2021 Preliminary Tax Levy. <br /> <br />COUNCIL ACTION REQUESTED <br /> <br />A motion to adopt one of the attached resolutions adopting the 2021 Preliminary Tax Levy. <br /> <br />Exhibits <br />A. Resolutions <br />B. Tax Rate Calculation <br />C. Tax Rate Impact <br />Item No.: 10 Date: September 28, 2020 <br />Item Description: Adopt 2021 Preliminary Tax Levy <br />Presenter: Ron Olson, <br />Finance Director <br />Agenda <br />Section: <br />Finance Director <br />Report