08-05-1999 Council Work Session Packet

Home Browse Search

Tax Levy, Tax Capacity Rate, and Impact of Tax Levy on Property Owners The total tax levy required to fund the proposed 2000 budget is $2,363,560. This is an increase of $71,680 or 3.13% over the 1999 levy. The breakout of the use of tax levy revenues by fund is shown in Attachment A-1. The estimated tax capacity for taxes payable in the year 2000 is $15 750,937. This is an increase of $1,035,89^ or 7.04% over the 1999 tax capacity. Based on the City's tax capacity and the proposed tax levy, the tax capacity rate would be 14.637. This is a 3.55% reduction from the 1999 tax capacity rate. Impact of Budget and Tax Lev\^ on Property Owners After two years of substantial reductions in property class tax rates, that shifted the property tax burden from commercial/industrial properties and higher-valued residential properties to lower valued residential properties, the 1999 legislature made only minor property class tax rate changes. The impact of the City's 2000 budget and tax levy is fairly similar across property types. Attachments A-4 and A-5 show the calculation of the impact of the City's tax levy on homes valued at $100,000, $200,000, and $400,000, and on a commercial property valued at $500,000. For a home valued at $100,000, assuming no change in property value, the City's share of the property tax bill would decrease by $9.19 or 5.1 %. For a home valued at $400,000, the City's share of the property tax bill would decrease by $59.09 or 6.1%. Levy Limit The 1999 legislature failed to remove levy limits on cities for year 2000 budget. The levy limit is tied to the implicit price deflator and household growth. The City's levy limit for 2000 is $2,363,566. The proposed levy is at the levy limit. General Fund Revenue Highlights A table showing the proposed 2000 General Fund revenues has been provided as Attachment A-8. The major revenue changes are as follows: 1. 2. Licenses and permits revenue has increased from $240,000 to $264,000 - an increase of $24,000 or 10% over 1999. The increase is due to the 10% increase in permit fees adopted by the Council in June of 1999 as part of its adoption of the iqxlated Uniform Building Code. Revenue from the federal COPS grant program has increase i from $20,000 to $30,000 due to a new COPS grant for the years 2000 - 2002. In addition, $25,000 of COPS grant funding carried over from 1998 is proposed to be used as an additional