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Memo - City Council 2017 Proposed Preliminary Budget and Tax Levy 5 5 General Fund Revenues Property Tax Levy 162,515$ License and Permits 81,800 Antenna Rentals 40,000 Plan Check Fees 38,000 Other Misc Adjustments 19,417 341,732$ The PIR transfer was restored to $200,000 per Council directive as referenced above. As per the forecast prepared in 2015 for the EDA operating fund as a result of the funding from the Round Lake Road TIF district expiring, an additional $30,000 in transfers was added and was approved by the EDA on July 25, 2016. All positions are currently still in the 2017 budget including the Working Foreman in Public Works. Revenues have largely increased due to increased Antenna Rental revenue and Building Permits and Land Use applications. The chart at the right illustrates the increases. Issues to Consider The current budget proposal is a $400,839 increase from the previous year. Public Safety increases are equal to $92,515 of the increase. Salaries and benefits are $92,820 of the increase, but remember all vacant positions and the Working Foreman have been included in this budget. $100,000 has been included for the Comprehensive Plan Update which could be a one-time expenditure. Unless there is a change in personnel and positions, most other increases are going to be on-going operation costs. Last year the Council balanced the budget using $160,325 in reserves, while we may not have used them as a result of vacancies and better than expected revenues with building permit activity and planning cases, this will not be sustainable in the future if we fill the vacant positions and as we are primarily built out the permit and planning revenue will not be a stable reliable source of revenue. The budget presented as directed by the City Council shows using $238,324 in reserves to balance the proposed 2017 budget. If we assume that $100,000 of this amount is a one-time expense for the Comprehensive Plan amendment, then the on-going concern is $138,324. This does include the General Fund portion of the Working Foreman position, if this were eliminated the on-going concern would amount to $101,666. To correct this concern in the current proposed budget would mean a levy increase of 7.6% or $264,181. We would then be using $136,658 in reserves for this budget which would be appropriate for one-time expenditures. Sample Levy Increases Staff has prepared a number of tax levy scenarios for discussion in evaluating setting a levy.