09-14-1992 Council Packet - Laserfiche WebLink

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i •n TO: FROM: DATE Ron Moorse, City Administrator Tom Kuehn, Finance Director September 10# 1992 SUBJECT: 1993 Budget and Proposed Tax Levy Attachment: A. Proposed Resolution - Tax Levy Collectible in 1993 ISSUES ^ ^ x.1. •1, Establish a maximum proposed 1993 Tax levy for the truth in taxation budget hearing(s), 2. Establish a preliminary budget for the truth in taxation hearing(s). DISCUSSION The Council has previously established the truth in taxation public hearing for Tuesday, December 1st at 7:00 p.m., and Wednesday, December 9th at 7:00 p.m. as the reconvened hearing if necessary. As required by state law the City must adopt, by September 15th, a proposed property tax levy maximum for collection in 1993 which will be published for the truth in taxation hearing. The levy can be reduced during the public hearing but cannot be increased. We are also required to establish a preliminary budget before September 15th and to adopt a final budget during the public hearings. The budget amount may increase or decrease from the original proposed and may remain flexible throughout the year. The proposed General Fund budget is adopted by motion, but the proposed tax levy must be adopted by resolution. The 1 993 budget reflects an effort to hold the line on overall expenditures while absorbing increased costs due to the imposition of the 6.5% sales tax and the first year operating costs for the new city facilities. The total general fund budget amount is $3,163,715. This is a $1 38,825 or 5.0% increase over the 19*^2 budget. The operating levy to fund the general fund budget is $1,725,915. This is an increase of $81,084 or 4.9%. Due to increases in levies for past year tax abatements and for the HRA city facility bonds, the total 1 993 tax levy has increased $109,454 or 5.6%. Durinq the budget worksession the Council discussed increasing the tax levy to provide for a reserve against a reduction in state Homestead Aid (HACA). The city receives $291,000 of HACA aid which enables the city to reduce the tax levy. Due to the State's budget problems there is a strong possibility that this aid will be reduced during 1993. The following is an indication of the tax levy impact of various reserve levels: