06-26-2000 Council Packet - Laserfiche WebLink

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i. ffr Ip Long Lake/Orono Consolidation Committee Joint City Council Meeting Monday, June 5,2000 Page 3 public facilities and gives the merged community the potential for enhanced facilities; i.e., city hail, public works, and water and sewer facilities. A merger would also reduce the amount of land necessary for public facilities and allow for enhanced planning of public facilities related to systems that do not necessarily follow city boundaries such as transportation, sanitary sewer, and stormwater. Consolidation of the two cities would also improve the two cities' ability to plan for integrated parks and trails. Fifield stated the Consolidation Committee has found that if the two cities do decide to merge, the combined city w ould strengthen the capabilities of City Staff through a consolidation of the two sets of staff, and would eliminate the substantial time and effort spent by both cities negotiating and administering fire and police contracts with each other. As it relates to the area of finance, the Consolidation Committee found a merger would result in lower spending for government services than for two separate cities both short-term and long-term: a reduction of the Cit>' portion of property ta.xes for Long Lake residents by nearly 50 percent; both short-term and long-term stabilization of property ta.\es for Orono residents; the receipt of up to $577,000 in cooperation grants to enable city facilities and equipment to be upgraded; and better control of ta.\es through the linking of land use decisions with service impacts. Fifield stated without a merger, the two cities in all likelihood would continue to experience increases in their property taxes. Fifield reiterated the residents of Long Lake will experience a significant drop in their city portion of property taxes with a merger, with a slight decrease being experienced by the residents of Orono. A merger would provide better stability of the city property tax rate, Fifield stated Figure 10 on Page 28 of the report gives a summary of the financial projections for the merged city and the financial projections for the two cities w ithout a merger. Fifield stated Figure 6 on Page 24 of the report illustrates the impact on the estimated property taxes payable in the yea. 2001 with a merger and without a merger. Fifield noted the city property tax rate will decrease in both cities with a merger. Fifield stated both cities are in very good financial condition at this time based on historical and current information, which provides a very strong foundation for implementing a merger. Fifield noted both cities at this time have good general fund reserves. The Consolidation Committee is anticipating approximately $132,000 in reduced expenditures over current budgets with a merger. Fifield pointed out the financial projections are not an iron-clad plan for the future but provides a good tool for determining the Hnancial impact on both cities with a merger and without a merger. Fifield noted he used the same assumptions for both a merger and without a merger in his financial projections. i