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ARDEN HILLS CITY COUNCIL - November 10,1006 1. In the Public Safety Capital budget, stalTis reconul1cnding a need assessment [or Fire Station #1 in 2007. The Lake Johanna Fire Board has also recommended that we conduct an asscssment As Council has previously been infollllcd, the Fire Department is planning for potential rcconstruction of Fire Station #1 (currcntly contemplated in thc Fire Capital Plan for 2011,) Staff rccommcnds adding a S5000 budget amount in the Public Safety Capital fund for this purpose. 3, The proposed budget still incorporates funding for Celebrating Ardcn Hills. 4, Thc EDC has presented a Strategic Plan that recommcnds a number of items for 2007 implemcntation, The only item that bas bccn incorporated into the budgct at this time is $5,000 in the EDA fund for Business Retention Program activities. GENERAL FUND AND TAX LEVY DISCUSSION The CUlTcnt proposcd budget is based on a 60/l) increasc in the tax levy from S2,523,737 to $1,675,161, A perccnt in the incrcase of the tax levy is S15,237, The City has hired Ehlers and Associates to prepare a Financial Plan for the City, to assist the City with assessing its current financial status and with making decisions regarding the 2007 budget and tax levy. City starr s primary concclll is that operating costs can be covered with a 4(% increasc in the tax levy, but our fund balances in the capital funds area are decreasing (due to significant capital improvcment projects) and the City needs to ensure the viability of those funds for future projects. Our primary sources of revenue [or those funds arc assessments and property taxes, At this time the projected budget includes $159,3 16 in transfers to the PIR/Capital Fund ($39,829) and the Public Safcty Capital Fund ($119,487). It is at the discretion of the City Council to elect to lower the transfer amounts in the following areas: . Establishing a Council Contingency for unanticipated purchases or projects during 2007 or dccreased rcvcnues (unspent contingcncy at the end of the year would add to the Gcneral Fund Balance) . Initial funding for a Capital Equipment Rcplacement Fund . Covcring the cost of a City survey ($10,500) . Contribution to Gencral Fund Balancc . Funding for possiblc implementation of all or portions of the EDC Strategic Plan Implementing any of the above options rcduccs the amount of thc transfer to the two capital funds. There are scveral options if the Council is intercsted in lowering the tax levy: . Dccrcase the transfer to the PIR/Capital Fund . Decrcasc the transfer to the Public Safety Capital Fund . Recommend cuts in thc proposed budget or capital plan :\