11-19-07 Budget-CIP Document - Laserfiche WebLink

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t- ~~HILLS MEMORANDUM DATE: TO: FROM: November 10, 2007 Mayor and City Council l. ) Michelle Wolfe, City Administrator d~.. V Sue Iverson, Finance Director/Treasure~ 2008 Proposed Budget SUBJECT: INTRODUCTION Weare pleased to provide you a draft copy of the Proposed 2008 Annual Budget. This budget was prepared per previous direction of the Council as follows: . 4.99% General Levy Increase . 3% Annual Salary Increases . 50% Share of Cost Increases for Deductible Health Plan . Previous discussions regarding proposed 2008 CIP projects/purchases This draft is provided to you in preparation for the November 19 Work Session, which will be devoted to discussion of the 2008 budget, CIP, and compensation plan. In your agenda packet, we will provide a final copy of the proposed budget including color graphs. DISCUSSION The proposed 2008 budget is based on a general tax levy increase of 4.99%. Key items to note within this budget are listed below: L The proposed budget includes a contingency amount of $63,409. Staff recommends maintaining some level of contingency for implementation of salary adjustments resulting from the compensation study currently nearing completion and unanticipated expenses that arise during the year. As a contingency budget, City Council approval would be required prior to use of the funds. The City Council could also choose to allocate a portion of the contingency funds to one or more of the capital funds (Capital Improvement/PIR Fund, Parks Fund, or the proposed new Equipment, Building and Replacement Fund.) Another option for the City Council is to reduce the contingency amount overall, which provides an opportunity to reduce the final general levy amount. If Council chooses either of the above options, staff strongly recommends leaving a minimum of $25,000 in contingency for salary adjustments and unanticipated expenses. 3