12-12-2022 Council Packet - Laserfiche WebLink

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AGENDA ITEM (-6.98%); and a $2,000,000 home will decrease $267.17 (-6.69%). The actual tax impact on any particular property will depend on how the property’s taxable value changed in relation to the rest of the City. Tables illustrating a 5% increase in value and a 5% decrease in value are included in this budget document. 5. General Fund Budget. a. General Fund Expenditures. The 2023 expenditure budget is $10,993,270 which is an increase of $1,011,392 (10.2%) over the 2022 budget. The largest increase is in Personal Services (Wages and Benefits) in the amount of $734,143. This includes $175,000 for the newly hired Fire Chief. Professional services is increasing by $100,000 (6.6%) as the result of an increase of $88,000 in the fire budget and $40,000 in assessing. Other expenses, which includes utilities and any budget lines not included in other categories, is increasing by $100,580 (20.5%). This is the result of increases in gas/electric costs, brush site disposal, and other inflationary cost increases. b. General Fund Revenues. For revenues, the General Fund budget also totals $10,993,270 and is increasing by $1,017,674 (10.2%). The General Fund property tax levy is increasing by $650,904 (13.0%) and covers two-thirds of the increase. The remaining third of the revenue increase is from non- tax sources. The bulk of the non-tax revenue increase is for contracted police services which are increasing by $208,100. By working cooperatively with our neighboring cities, we are able to provide expanded public safety services to residents of all the cities. 6. 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. This fund also includes tax levy dollars. By state law, park dedication fees 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. 7. Debt Service Funds. Debt Service Funds are used to service the debt on the City’s outstanding bonds. The 2022 levy for debt service is $1,002,000. 8. 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. On the revenue side of the budget, the utility rates are approved annually as part of the fee schedule. The utility rate increases being recommended are Water 2%; Sewer 2%, Stormwater 2%, and Recycling by 4%. a. Water. The water fund has historically been operating at a loss. Because depreciation is a non - cash expenditure, the fund has had a positive operating cash flow since 2009. In previous years, the operating loss has been covered by the revenue received from antenna leases on the water towers. The revenue from the antenna leases has been moved out of the Water budget since 2018 and this revenue decrease has been recovered through water rates. As presented, the operating budget for 2023 will have an operating income of $53,200. Net non- operating revenues and expenses increase the income to $63,200. The expense budget is increasing by $58,880 (5.2%). $27,560 is due to Personnel Services. The non-operating interest expense is for the interest