01-11-2016 Council Packet - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, December 14, 2015 6:30 o'clock p.m. *3. CITY COUNCIL WORK SESSION MEETING OF NOVEMBER 23, 2015 Levang moved, Printup seconded, to approve the minutes of the Orono City Council Work Session of November 23, 2015, as submitted. VOTE: Ayes 5, Nays 0. PUBLIC HEARING — 6:30 P.M. 4. ADOPT 2016 BUDGET — RESOLUTION NOS. 6575, 6564, 6565, 6566 Olson noted this meeting is to discuss and adopt the City's 2016 budget and tax levy and not to discuss an individual property owner's valuation or property taxes. The total tax levy required to fund the 2016 budget is $4,954,480. This is an increase of $182,480 or 3.8 percent over the 2015 levy. The entire increase in the levy is designated for funding the City's Pavement Management Plan and will help to address the City's aging road infrastructure. Olson stated even with the increase, Orono's tax rate will decrease slightly in 2016 and that Orono continues to have one of the lowest tax rates in both Hennepin County and the state of Minnesota. Olson stated the Council sets the levy, which is what will be done tonight, and then the levy amount is divided by the total tax capacity of everyone in the City. In Orono, the tax levy is proposed to be $4.954 million. The City's total tax capacity is $28,350,885. As a result of the City's increased tax capacity, the tax capacity rate will decrease from 17.39 percent in 2015 to 17.33 percent in 2016. Using this tax rate and assuming no change in a property's value, the City's share of the property tax bill would result in a decrease of $1.44 on a home previously valued at $250,000; a decrease in tax of $3.05 on a $500,000 home; a $1 million home would see a decrease of $6.86; and a $2 million home would have a decrease of $14.49. The 2016 expenditure budget is $7,708,570, which is an increase of $128,700 over the 2015 budget. The biggest department in the City is the police department, which will have an increase of $105,175. The increase is the result of a 2.75 percent wage that was negotiated with the police unions. Other notable increases are $15,730 for the 2016 election, a $20,000 increase in assessing charges to Hennepin County, and $25,820 in special services. The expenditures in special services are charged back to the party that requests the service. The increase in this department is offset by an increase in revenues. In addition, a number of departmental budgets are decreasing. The budget for mayor and council is being reduced by $8,460 as a result of a reduction in the Lake Minnetonka Conservation District levy. Engineering is being reduced $5,000 to bring it in line with historical costs. Street maintenance is being reduced by $60,610 with these expenditures moved to the Pavement Management Fund. Olson stated the primary revenue source for the General Fund is the property tax levy. The 2016 General Fund tax levy is $4,016,500, which is the same amount as the 2015 General Fund levy. Total General Fund revenues are budgeted to increase by $128,700 in 2016. Olson state the City Council should hold the public hearing and then make a motion adopting the resolutions that are before them this evening. Mayor McMillan opened the public hearing at 7:10 p.m Page 5 of 44