12-9-2024 CC Agenda Packet - updated 12-9-2024

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increased by 2.3%. For 2025, it is anticipated that the tax rate can remain the same as 2024 at 16.35%; one of the lowest rates in both Hennepin County, and the State of Minnesota. Using this tax rate and assuming no change in a property’s value, the City’s share of the property tax bill would remain the same compared to 2024. 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. The table supplement suggest a median City increase in market value of 2.6%. For an average home in Orono, worth 1,056,900 in 2024, with the average increase in market value, can expect an increase of $56.28 (2.88%) in their City portion of their property tax bill. GENERAL FUND General Fund Revenues. The 2025 General Fund Revenue Budget totals $11,935,000, an increase of $398,370 (3.45%). Property taxes makes up approximately 58% of the budget, with an increase of $344,400 (5.2%). 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%. 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, fine and forfeit, interest, and miscellaneous charges. Detailed revenue information is included with this document. General Fund Expenditures. The 2025 expenditure budget is $11,935,000 which is an increase of $398,370 (3.45%) over the 2024 budget. By category, the largest increase is in Personal Services (Wages and Benefits) in the amount of $602,650 (7.99%). Offsetting the large increase is Professional Services, which is decreasing by $193,510 (-9.72%). 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. By Department, the significant changes are: Administration is increasing by $73,550 (14.7%) offset by a decrease in Election of $61,050 (- 62.17%). Expenditure is moved around due to 2025 being a non-election year to account for more staff time to scan documents in regards to data retention. Communications is increasing by $110,100 (282.31%) due to the addition of a communication personnel. Assessing is decreasing by $270,000 (100%) as Hennepin County will no longer be charging cities with population under 30,000 for assessing service, but will include the cost in their portion of property taxes. Central Services is increasing by $90,850 (21.16%) offset by Parks decreasing by $88,700 (-20.54%) due to reallocation of staff time with the Parks and Facilities Superintendent position restructured to provide oversight to facilities. Police is increasing by $341,690 (5.97%) due to personnel cost and the additional allocation to IT service cost due to added IT personnel. Fire overall is increasing by $160,550 (11.17%). Orono Fire Department’s first full year of operational service to the Navarre service area offsets from Long Lake Fire service and transitional cost of the North service area. Orono Fire Department’s model of fire service is a mixture of on-call and duty shift model, therefore the significant difference in personnel expenses from the previous model serviced by Long Lake Fire Department. Additional information on general fund departments can be found in the information included with this document. Page 2 of 113 150