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The 2016 budget the council did include an additional levy increase of 3.8% ($183,000) <br />specifically for road funding. Taxes for all purposes (roads or General Fund) can be increased <br />by $399,000 without increasing the tax rate. <br />Wages <br />The wage discussion has two parts. The first is union wages. Staff is looking for guidance on an <br />amount to include in the 2017 budget for anticipated wage increases due to union negotiations. <br />The amount could be included in the contingency line item. <br />The other wage discussion involves the possibility of a cost of living increase for non-union <br />employees. From April 2015 to April 2016 the CPI has increased 1.1%. For 2016, inflation is <br />projected to increase 1.5%. <br />Health Insurance <br />The contribution that the City makes toward health insurance represents a significant General <br />Fund expenditure. In 2016 the contribution is $1,255 per month for families, and $915 per <br />month for individuals and waivers. We have not received the final quotes for 2017 insurance <br />costs, however we have been told that there will be a slight decrease in costs. Council can <br />discuss whether or not to increase the 2017 insurance contribution. <br />Council Goals <br />A list of Council goal is included as attachment C. The Council may want to discuss how to <br />fund these goals within the 2017 budget. Highlights include: Roads, Navarre <br />study/improvements, Comp Plan, and legal costs for code updates. <br />Over the next seven months there will be many budget discussions, some involving short term <br />operating goals like the 2017 budget. Others discussions will focus on longer term funding <br />needs like roads and the CIP. Sometimes the process can seem tedious and time consuming, <br />other times is can be frustrating and emotional. During the process is may help to remember that <br />the adoption of the annual budget is one of the primary responsibilities of the Council. As <br />described in the final paragraph of attachment E, "Accurate and complete budgeting is crucial to <br />a city. It provides sound legal, financial and ethical basis for city operations." <br />2017 Budget —Page 3 <br />