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MINUTES OF THE ORONO TRUTH-IN-TAXATION MEETING Monday, December 12, 2011 6:00 o’clock p.m. _____________________________________________________________________________________ Page 2 of 4 increase of $60. With a zero percent change in value, a $500,000 would increase $62 and a million dollar home would increase by $139. Olson stated the 2012 budget reflects an effort to maintain City services during an extended period of flat to decreasing revenues. The economy and the housing market have limited the City’s primary revenue source, which is the property tax levy. Other revenue sources have continued a four-year trend of remaining flat or decreasing. Throughout this period, City Staff has worked diligently to control expenditures. The overall General Fund budget and property tax levy has not increased from the 2011 budget. The proposed 2012 General Fund expenditures are $5,785,630. This is the same amount as the 2011 budget. This is the smallest General Fund budget since 2007, and is $380,130 less than the peak budget year of 2009. The 2010 budget was the first year that the golf course was included in the General Fund. If the golf course expenditures are excluded for comparison purposes, the 2012 General Fund budget is $546,460 less than the 2009 budget. The majority of the budget decreases are the result of reductions in staffing levels. The 2011 budget reflected the following unfilled positions: building inspector, planner, public works maintenance worker, a part-time clerk, and four police officers. In 2012, the position of Public Works Director/City Engineer is being added to the budget. By adding this position, the City will be able to increase efficiency and provide better customer service to our citizens. The savings in contracted services that will result from the addition of this position will allow the addition to be made without increasing the overall budget. Although the overall General Fund budget is decreasing, certain line items are increasing. The budget includes a 1 percent increase in employee wages effective July 1. For the fiscal year, this is an effective increase of 0.5 percent. The City’s contribution for insurance is being increased by $75 per month for employees who are on a family health plan. The contribution is frozen at the 2011 level for employees who are on single coverage or waive insurance. 2012 is the first year that all employees will not receive the same insurance contribution. The proposed General Revenues are $5,785,630, which is the same amount as 2011. The property tax levy, representing 68.0 percent of total fund revenues, has not been increased from 2011 and remains at $3,932,260. While most revenues are being budgeted at the same level as 2011, two revenues have increased significantly. The revenue for building permits has been increased by $14,600. The other significant revenue increase is the line for engineering and legal fees, which has been increased by $20,000. Both of the revenue increases are based on the actual 2010 revenues and an estimate of 2011. Other, less significant revenue sources have also increased and are identified in the revenue section of the budget. Olson stated in addition to the General Fund budget, the City also adopts budgets for certain special revenue funds. The Park Fund revenues are budgeted and include $5,000 in tax levy. The 2012 Park Fund budget includes $23,500 for new equipment at the Crystal Bay Park. The City has applied for a grant in the amount of $11,750 to help fund this improvement. The Drug/Felony Forfeiture Fund budget includes revenues and expenditures related forfeiture activity of the Police Department. The funds are restricted for use related to drug/DWI enforcement activities. The TIF Fund budget accounts for funds associated with the Orono Senior Housing TIF District. Item #02 - CC Agenda - 01/09/2012 Approval of Truth-in-Taxation Meeting Minutes 12/12/2011 [Page 2 of 4]