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1 <br /> <br /> <br /> <br /> <br /> <br /> <br />MEMORANDUM <br /> <br /> <br />DATE: September 26, 2016 <br /> <br />TO: Honorable Mayor and City Council <br /> <br />FROM: Sue Iverson, Interim City Administrator/Director of Finance & Admin Services <br /> <br />SUBJECT: 2017 Proposed Preliminary General Fund Budget and Tax Levy <br /> <br /> <br />INTRODUCTION <br /> <br />In preparation for adoption of the preliminary tax levy in September, this memo addresses the <br />following information: residential property values, discussion on preliminary levy, salary <br />assumptions being used to prepare the preliminary budget, and a discussion on capital <br />improvement funding. <br /> <br />RESIDENTIAL PROPERTY VALUES <br /> <br />According to information provided by Ramsey County in May of this year, the median home <br />value in Arden Hills will increase from $300,300 for 2016 taxes, to $306,350 for 2017 taxes <br />which is a 2.0% increase (last year we saw a 1.8% increase) in value compared to the county <br />average increase of 4.6%. According to Ramsey County, assessed value had declined for five <br />consecutive assessments, the markets are stabilizing, and we are now experiencing an increase of <br />residential, apartment, and commercial values. Arden Hills’ values were very stable during this <br />time or increased, thus we see a smaller average increase now vs. the county-wide increase. <br /> <br />In order to evaluate the true impact to the residential property owner, you need to take into <br />account the increase in fiscal disparities (increase of 10.1%) and the change in the taxable value <br />(increase of 1.9% after exclusions). <br /> <br />To help illustrate this, the following table shows the impact to the residential property owner due <br />to the increase in fiscal disparity dollars and the changes in the assessed market values. This <br />results in a net Tax Rate decrease of 2.6% before any levy changes are made. (Last year we saw <br />a decrease of 6.5% in this same comparison) <br /> <br />Assuming no City levy change, the home owner that has a median valued home (value going <br />from $300,300 to $306,350) will see their City taxes going down annually by $3.18 or 0.4% as <br />illustrated on the following chart.