09-08-2014 Council Minutes - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, September 8, 2014 7:00 o’clock p.m. _____________________________________________________________________________________ Page 4 of 25 (4. DRAFT PAVEMENT MANAGEMENT PLAN, Continued) Martini noted the difference in cost between a seal coating and a mill and overlay is fairly significant, so it is definitely important to perform routine maintenance on the pavement to help extend the life of the roads. McMillan noted the City has invested a significant amount of money in some recent road projects and that regular seal coating and crack sealing would help to maintain those. Loftus asked if the Council would like Staff to pursue any specific public process before the City Council takes final action on the plan. McMillan indicated she would prefer putting the plan on the website. The City Council took no formal action on this item. 5. 2015 PRELIMINARY BUDGET INFORMATION McMillan noted the MN Legislature has given cities an extra two weeks to approve their budgets and that the City’s 2015 preliminary budget will be approved at the next City Council meeting. Olson stated at the next Council meeting the preliminary budget will be adopted, with the final budget being adopted at the December Council meeting. The preliminary budget is a culmination of a three and a half month process. Olson stated as it relates to the tax levy, that is currently set at $4,722,000, with a large portion being the general fund operating budget, which is approximately 85 percent of the tax levy. That dollar amount represents a 1.5 percent increase in the overall tax levy and is the first tax increase in four years. Olson indicated the City’s debt service is the other 15 percent of tax levy. In 2014 and 2015, the City’s debt service was $755,500. From 2016 to 2022, the debt levy will be $755,500 and will not be changing. The only thing affecting taxes in the near future would be changes in the operating levy that go to the General Fund. Olson indicated the graph on the overhead shows the City’s tax capacity, tax rate, and tax levy. In the mid 2000’s, the City’s tax capacity was higher and decreased as a result of the housing market. Olson stated the City’s tax capacity rate started increasing as property values came down. Since approximately 2008 to 2009, the levy has been relatively flat. Olson noted the City’s tax rate and tax capacity fluctuate more than the tax levy and that a person needs to look at all three factors to see what is happening with taxes. Olson noted from 2010 to 2014, the state average increase for property taxes was eight percent, which would be a pretty significant increase. Olson noted the City has attempted to be good stewards of the taxpayer dollars and has kept their tax levy rate fairly flat. Orono went up three percent over that same period of time as compared to the eight percent average. Olson noted Spring Park pays the City of Orono for police service and was decreased by $136,000 due to the police now patrolling by zones rather than 24-hour coverage.