7B, 2009 Operating Levy Payble in 2010 - Resolution 2009-024 & 2009-025

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w- � DEN HILLS MEMORANDUM DATE: September 9, 2009 TO: Honorable Mayor and City Council FROM: Sue Iverson, Finance Director SUBJECT: Establishing 2009 Truth -In -Taxation Hearing Dates Adoption of the Preliminary 2009 Operating Levy Payable in 2010 Background: By September 15, 2009, the City is required to adopt and certify to Ramsey County a preliminary levy and Truth -In -Taxation hearing dates. Discussion: Operating Levy Based on Council direction at the August 17, 2009 Work Session, staff has prepared a preliminary levy of $3,057,666. (This is a decrease of $32,805 over the number given the Council at the work session as staff had incorporated the changes requested by the Council. We have also received word from our insurance carrier that our increase will be 1 % and the previous percentage used was 8%) The overall levy limit for the City of Arden Hills with the state mandated levy limit plus allowable special levies is $3,151,708. The proposed 2010 levy is $94,042 under that limit. The overall increase in the proposed levy is a 3.7% increase over the 2009 levy; however, the City's portion of the levy is $2,792,928 after Fiscal Disparities which equates to a 3.7% increase over the 2009 City portion of the levy of $2,693,125. This results in a 12% increase in the Tax Rate from 2009, as the City's tax capacity fell by $974,065 or -7.4%. The impact on an average medium home valued at $278,800 is an increase of $24.61 or 4.2% annually. The average decrease in market value for residential property in Arden Hills was 6.6%. Determination of the preliminary levy amount is based on 2010 budget information assembled to -date. (This information is summarized in the attached table). One item to note is the unallotment of MVHC from the State of $61,774 for 2010. This amount is figured into the preliminary 2010 budget. Market Value Homestead Credit is credited to property owners on their property tax statements and then reimbursed to the City from the State. The City has been informed from the Department of Revenue that we will not receive this amount, so the preliminary budget and levy has accounted for this. This amounts to 2.1 % of the levy increase and $14.16 or 2.4% of the tax increase to the average medium homeowner in the City of Arden Hills. Public Safety makes up the remainder of the