09-23-2024 CC Agenda Packet - Laserfiche WebLink

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Date: September 23, 2024 Item: 15 Presenter: Maggie Jin, Finance Director Section: Finance Report Title: Adopt 2025 Preliminary General Fund Budget - Resolution 7508 1.Purpose: The purpose of this agenda item is to adopt the 2025 Preliminary General Fund Budget. 2.Background: Work on the 2025 General Fund budget began in May and have since been updated and refined. As part of the budget process, there have been meetings with the budget committee followed by council work sessions in July and September for the General Fund. General Fund Revenues. The 2025 General Fund Revenue Budget totals $11,993,000, an increase of $456,370 (3.96%). Property taxes makes up 58% of the budget, with an increase of $402,400 (6.13%). The remainder of the General Fund revenue is made of non-tax sources with the next largest revenue source coming from public safety charge at 24%. The public safety charge comes from service contracts with neighboring cities for police protection. By working cooperatively with these neighboring cities, the police department is able to provide enhanced service at a lower cost by eliminating overhead and duplication of service. The remaining 18% of revenue is made of: license, permits, intergovernmental revenue, general government service charges, fines and forfeitures, interest, and miscellaneous charges. General Fund Expenditures. The 2025 General Fund Expenditure Budget totals $11,993,000, an increase of $456,370 (3.96%). Personal service budget is $8,164,100, the largest increase to the General Fund expenditure with an increase of $625,100 (8.29%). This includes staff wages and benefits: unions contract includes a 3% cost-of-living adjustment (COLA) and non-union wage increases are included in the preliminary budget numbers, are being reviewed and will be presented at a future council meeting. Additionally, a 10% increase in health insurance premium have been included in the budget, with actual numbers to be received at the end of September or early October. The largest decrease for expenditure comes from Professional Services. Assessing service is no longer to be charged to cities under a population of 30,000 and will be included in Hennepin County's portion of property taxes. Long Lake Fire service cost is also decreased due to no longer serving the Navarre service area, which they had serviced for half of 2024. Additional changes from the 2024 budget includes the following: Administration and Elections – 2025 is not an election year so expenditures have been moved around to accommodate for additional staff hours to scan documents into the City’s document retention software. Communications – This is a newly created department within the General Fund in 2024. This will allow for better tracking of expenditures related to newsletters, social media, and other communication related costs. For 2025 budget, a Communications position is budgeted AGENDA ITEM 89