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<br />e <br /> <br />e <br /> <br />e <br /> <br />~ <br />~~HILLS <br /> <br />MEMORANDUM <br /> <br />DATE: <br /> <br />July 11,2001 <br /> <br />TO: <br /> <br />Joe Lynch, City Administrator . <br /> <br />Tmo"" Po,', C;ly A"om'~@ <br />2001 Legislative Changes Affecting 2002 Budget <br /> <br />FROM: <br /> <br />SUBJECT: <br /> <br />I called Gene Ranieri, AMNI Executive Director, yesterday to inquire about 2001 legislative <br />session impacts to the City of Arden Hills, The three primary topics we discussed were HACA, <br />LGA and tax increments. <br /> <br />HACA <br /> <br />The City of Arden Hills was certified by the Minnesota Department of Revenue to receive <br />$99,994 of Homestead and Agricultural Aid (HACA) in 2001. This aid has been eliminated and <br />the City will receive $0 in 2002. Even though the Implicit Price Deflator (IPD) will guide the <br />limits on levy growth, the legislature allows cities to levy back any net loss of aid from the <br />elimination of HAC A. <br /> <br />LGA <br /> <br />The City of Arden Hills was certified by the Minnesota Department of Revenue to receive <br />$10,242 in Local Goverment Aid (LGA) in 2001. Preliminary estimates are that this aid amount <br />will be frozen for 2002 (i.e., no increase or decrease). <br /> <br />Tax Increment <br /> <br />The class rate compression for commercial/industrial property (i.e., from 3.40% in Pay 2001 to <br />2.0% in Pay 2002) coupled with higher levels of state funding for the K-12 education will reduce <br />the City's 2002 tax increment by an estimated 38%. <br /> <br />Based upon July, 2001 tax settlement information, Round Lake Business (TIF District #2) 2001 <br />annual tax increment is estimated at $502,274, A 38% reduction would reduce 2002 increment <br />dollars to $341,546. The 2002 G.O. bond debt service is $256,315. <br />