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1 <br /> <br /> AGENDA ITEM -1B <br /> <br /> <br /> <br /> <br />MEMORANDUM <br /> <br /> <br />DATE: September 18, 2017 <br /> <br />TO: Honorable Mayor and City Council <br /> William S. Joynes, Sr., City Administrator <br /> <br />FROM: Dave Perrault, Interim Director of Finance & Administrative Services <br /> <br />SUBJECT: 2018 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 August of this year, the median home <br />value in Arden Hills will increase from $308,200 for 2017 taxes, to $333,800 for 2018 taxes <br />which is an 8.3% increase (last year we saw a 2.0% increase) in value compared to the county <br />average increase of 6.3%. According to Ramsey County, values of residential properties are <br />increasing moderately, while values for commercial, industrial, and apartments are increasing at <br />a more rapid pace. Also of note, estimated market values are now above the peak from 2008. <br /> <br />In order to evaluate the true impact to the residential property owner, we take into account the <br />increase in fiscal disparities (increase of 10.1%) and the change in the taxable value (increase of <br />10.9%). <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 10.6% before any levy changes are made. (Last year we saw <br />a decrease of 2.6% in this same comparison). <br /> <br />Assuming no City levy change, the home owner that has a median valued home (value going <br />from $308,200 to $333,800) will see their City-share of taxes decreasing annually by $18.47 or