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Home My WebLink About7A, Preliminary Levy & T-N-T Hearing Dates .. _HILLS Request for Council Action Prepared By: Sue Iverson ~ Council Meeting Date: September 8, 2008 Preliminary Levy and T -N-T Hearing Dates Budgeted Amount: N/A Actual Amount: N/A Funding Source: Recommendation: A motion to adopt Resolution 2008-044, a Resolution setting the preliminary levy for taxes payable in 2009 in the amount of $3,003,434. A motion to adopt Resolution 2008-045, a Resolution adopting Truth-in-Taxation public hearing dates for proposed taxes payable in 2009. The dates established are Decernber 1 , 2008 and December 8, 2008. Supporting Documents: 1. Memorandum from Sue Iverson to City Council, September 3, 2008 2. Tax Impact Worksheet 3. Resolution 2008-044 4. Resolution 2008-045 .. _HIllS MEMORANDUM DATE: September 3,2008 TO: Honorable Mayor and City Council FROM: Sue Iverson, Finance Director ~ SUBJECT: Establishing 2008 Truth-In-Taxation Hearing Dates Adoption of the Preliminary 2008 Operating Levy Payable in 2009 Background: By September 15, 2008, the City is required to adopt and certify to Ramsey County a preliminary levy and Truth-Tn-Taxation hearing dates. Discussion: Operatine Levv Based on Council direction at the August 18,2008 Work Session, staff has prepared a preliminary levy of $3,003,434. (This is an increase of $112 over the number given the Council at the work session as the Department of Revenue has now given further clarification on the public safety levy.) The proposed 2009 budget reflects the 3.9% state mandated levy limit plus allowable special levies. The City of Arden Hills received an initial overall levy limit from the Department of Revenue of $2,920,373 to which we are allowed to add special levies of $83,061 ($15,464 for PERA increases and $67,597 for public safety personnel wages and benefits increases over 2008.) This gives the City of Arden Hills an overall levy limit of $3,003,434. The overall increase in the proposed levy is a 7.4% increase over the 2008 levy; however, the City's portion of the levy is $2,747,913 after Fiscal Disparities which equates to a 7.2% increase over the 2008 City portion of the levy of $2,563,635. This results in a 6.5% increase in the Tax Rate from 2008. The impact on an average medium home valued at $280,950 is an increase of $4.89 or 0.9%. The average decrease in market value for residential property in Arden Hills was 4.9%. Determination of the preliminary levy amount is based on 2009 budget information assembled to-date. Truth-in- Taxation Hearine Dates: The Truth-in-Taxation hearing dates are established as follows: Monday, December 1,2008 - 6:30 p.m. - Initial hearing date Monday, December 8, 2008 - 6:30 p.m. - Continuation hearing date (ifneeded) Memo City Council 2008 Truth-in- Taxation Hearing Dates and 2009 Preliminary Tax Levy 2 It is anticipated the Council will adopt the final 2008 levy payable in 2009, and the 2009 budget, on December 8, 2008. Recommended Action: 1. Adopt Resolution 2008-44, a Resolution setting the preliminary levy for taxes payable in 2009 in the amount of $3,003,434. 2. Adopt Resolution 2008-45, a Resolution adopting Truth-in-Taxation public hearing dates for proposed taxes payable in 2009. The dates established are December 1, 2008 and December 8, 2008. Proposed Pay 2009 Property Tax Impact Worksheet Taxing District: STEP 1 - Calculate the Taxing District's Tax Rate: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. STEP 2 - Calculate the Impact of the Taxing District's Rate on Residential Homestead Taxes: 13. Assumes a -4.90/0 increase in market value from 2008 to 2009, which is the countywide median increase. (F) - (H) 14. 15. 1,577 $308,86 $230.4 7 $260.46 16. 2,954 $578,54 $106,54 $556.17 17. 3,680 $720,73 $41,20 $712.08 18. 5,321 $1,042.12 $0,00 $1,042,12 19. 8,608 $1,685,88 $0.00 $1,685,88 20. 21. 22. 23. 24. 25. (F) - (H) Increase $237.40 $263.05 $2,59 $119,55 $561,06 $4.89 $57.40 $718,05 $5.97 $0,00 $1,043,00 $0,88 $0,00 $1,694,88 $9,00 26. 27. 28. 29. 30. ..... '.:'::~11111111:::.:.::~::::. -4,9% -4,9% 1,3% 3,0% 3,0% 1.00/0 -4,9% -4.9% 1,3% 12.2% 12,2% 0.90/0 -4.9% -4,9% 1.3% 39,3% 39,3% 0.80,'0 -4,9% -6,0% 0,1% 0,0% 0,0% 0.10/0 -4,9% -5.6% 0.5% 0.0% 0,0% 0.50,'0 7.4% 0,0% 7,4% 9.30.10 7,2% 0.6% 6.5% 0.00.10 0,0% 0,0% 0,00.10 0.0% Instructions for Calculating a Residential Homestead Property Tax: D. Taxable Market Value of Residential Homestead Assumes that the Pay 2009 market value increased over Pay 2007 by 3,2%, The maximum increase allowed under the Limited Market Value law is the greater of: (1) 150J'o increase or (2) 330J'o of the difference from 2007 to 2008, Countywide, the median increase in taxable market value from Pay 2007 to Pay 2008 is 0,5%. E. Calculate the Net Tax Capacity of a Residential Homestead Pay 2008: 1 st 500,000 of Market Value @ 1.000J'o, remainder @ 1,25% Pay 2009: 1 st 500,000 of Market Value @ 1,OOoJ'o, remainder @ 1,25% F. Calculate the taxina district's portion of the Gross Tax Pay 2008: multiply the Pay 2008 net tax capacity (E) by the Pay 2008 tax capacity local tax rate (A7), plus multiply the Pay 2008 market value (0) by the Pay 2008 market value local tax rate (A 12) Pay 2009: multiply the Pay 2009 net tax capacity (E) by the Pay 2009 tax capacity local tax rate (87) , plus multiply the Pay 2009 market value (0) by the Pay 2009 market value local tax rate (812) G. Calculate the total market value homestead credit 0.400J'o of the first 76,000 of market value (0), reduced by 0 ,090J'o on the market value over 76,000 The credit decreases as the market value over 76,000 increases, until a 414,000 home receives 0 credit. H. Calculate the taxina district's estimated share of market value homestead credit The credit is apportioned to all taxing districts based on their share of the total tax rate, Example of 150,000 home: (76,000 x .40% = $304) - (74,000 x ,090J'o = $66,60) = $237.40 Assume the city is 30% of the total tax, then the city receives 300J'o of the Credit $237.40 x 300J'o = $71,22 The actual percentage will vary depending on the combination of county, city/town, school, and special taxing districts, I. Calculate the taxina district's portion of the Net Tax Gross Tax (F) minus the taxing district's share of credit (H) 26..30. Calculate the % increase/decrease from 2008 to 2009 (2009 -2008) / 2008 ~ 4~HItLS CITY OF ARDEN HILLS COUNTY OF RAMSEY STATE OF MINNESOTA RESOLUTION NO. 2008-044 A RESOLUTION SETTING THE PRELIMINARY LEVY FOR TAXES PAYABLE IN 2009 BE IT RESOLVED by the Arden Hills City Council that the following proposed sums of money be levied for levy year 2008 payable in 2009 upon taxable property in said City of Arden Hills for the following purposes: LEVY AMOUNT BEFORE HACA HACA CERTIFIED LEVY AMOUNT General Fund $3,003,434 $-0- $3,003,434 PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF ARDEN HILLS THIS 8th DAY OF SEPTEMBER, 2008. STANLEY D. HARPSTEAD, MAYOR ATTEST: RONALD MOORSE, CITY ADMINISTRATOR CITY OF ARDEN HILLS COUNTY OF RAMSEY STATE OF MINNESOTA RESOLUTION NO. 2008-45 RESOLUTION ADOPTING TRUTH IN TAXATION PUBLIC HEARING DATES FOR PROPOSED TAXES PAYABLE IN 2009 BE IT RESOL VED by the Arden Hills City Council that the following Truth in Taxation Public Hearing dates, time and places for proposed property taxes payable in 2009 be certified to the Ramsey County Auditor and that notice of the Public Hearings be published in accordance with Minnesota Statute. Public Continuation Hearing Hearin2 (If Needed) Adoption Hearin2 Date: December 1, 2008 December 8, 2008 December 8, 2008 Time: 6:30 P.M. 6:30 P.M. 7:00 P.M. Place: Council Chambers Council Chambers Council Chambers 1245 Highway 96 1245 Highway 96 1245 Highway 96 PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF ARDEN HILLS THIS 8th DAY OF SEPTEMBER, 2008. STANLEY D. HARPSTEAD, MAYOR ATTEST: RONALD MOORSE, CITY ADMINISTRATOR