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Memorandum <br /> <br /> <br />Date: November 12, 2020 <br /> <br />To: Honorable Mayor and City Council Members <br /> <br />Through: Mark R. Statz, City Administrator/City Engineer <br /> <br />From: Bruce DeJong, Finance Director <br /> <br />Item: 2020-2029 Long-Range Financial Management Plan <br /> <br />City staff have created this comprehensive view of the City of Ce <br />operations to all the City Council to better revi <br />Plan includes all funds of the City. Using this information, we make estimates of <br />available cash, tax levies, and property tax rates. <br /> <br />We have gone through most individual fund budgets in detail with the City Council <br />through the course of the year. We have incorporated prior year spending adjustments <br />and made additional estimates of budget adjustments based on expected changes. <br />101-General Fund <br />The General Fund includes the preliminary budget numbers for 2021. We have not yet <br />made an estimate of the actual results of 2020. Our estimate is based on a 3% <br />inflationary increase in revenues and expenditures except where we have outside <br />influences that may change those estimates. We have chosen to not change any state or <br />county aid projections, since we have no control over those amounts. Our license and fees <br />revenues are primarily based on building permits. We have a large number of home <br />permits currently, but are expecting that level of construction to wane as platted lots are <br />built on. We have chosen to taper that down from $196,2000 in 2021 to $100,000 in <br />2025. That amount of base remodeling permit revenue is then raised 3% annually <br />through 2029. The property tax levy floats to an amount sufficient leave a balanced <br />budget. <br /> <br />With the new property value that is coming online from Ruffridge-Johnson, Midwest <br />Best Water, and other new home construction, this will undoubtedly result in an <br />increased tax base. We have added $22,000 of tax capacity value for 2021 through 2022 <br />to recognize the new value, which should reduce tax changes on an average home. The <br />challenge comes when we reduce our revenue estimates without any offsetting increases <br />other than property tax levy. That results in some higher tax increases starting in 2022 <br /> <br />