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Page 1 of 3 <br /> <br />AGENDA ITEM – 1D <br /> <br />MEMORANDUM <br /> DATE: August 17, 2020 <br />TO: Honorable Mayor and City Councilmembers <br />Dave Perrault, City Administrator <br />FROM: Gayle Bauman, Finance Director <br />SUBJECT: Preliminary General Fund Budget <br />Budgeted Amount: Actual Amount: Funding Source: <br />N/A N/A N/A <br /> <br />Council Should Consider <br />Staff is requesting City Council to review and provide feedback to the attached preliminary General <br />Fund budget for the 2021 fiscal year. <br /> <br />Background <br />Annually, City staff prepares and submits a preliminary budget to the City Council for review and <br />feedback. Attached to this memo is the City’s preliminary General Fund budget for the 2021 fiscal <br />year. Each department provided their respective forecasts for this budget. <br /> <br />The proposed 2021 budget is $5,193,530, an increase of $175,220 or 3.5%. For the purpose of this <br />discussion, there is a 3% ($124,060) tax levy increase reflected in the budget, $74,060 for the <br />General Fund and $50,000 for the Public Safety Capital Fund. As presented, the General Fund <br />Budget is underfunded by $81,210, which is less than the budget shortfall projected in the 2020 <br />budget of $121,590. This practice is not sustainable in the long term. A tax levy increase of 5.0% <br />would be needed to balance the budget in 2021. <br /> <br />Projected 2021 property information is not yet available from Ramsey County. Because of this, <br />staff is unable to calculate tax rates or levy impacts. <br /> <br />The 2021 preliminary budget is currently being prepared assuming a 3.0% wage adjustment for all <br />staff; the IUOE Local 49 Union Contract was approved back in December 2019 at 3% for 2021. <br />There is also a 3% increase assumed for health, a 0.0% increase for dental and a 0.0% increase for <br />life insurance premiums. No new positions are included in the budget but there were changes to <br />some of the wage allocations. <br /> <br />2021 budget information was received from Ramsey County and Lake Johanna Fire Department <br />for public safety. The police contract is expected to rise by 3.7%, or $50,080 for 2021. Information <br />provided by Ramsey County on this increase is as follows: <br />