2025 Vol 19, Issue 5 October Gem Lake News

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Gem Lake News Page 2 of 8 Continued from page 1 The following changes were made from the 2025 adopted budget as a basis for the 2026 proposed preliminary property tax levy: • Based on the 2015 Refunding Bond schedule the debt levy for the 2026 is set for $77,763. In addition, in 2018, the City issued bonds for the improvements on Scheuneman Road and the 2026 debt levy for this issue is $8,015. These two debt levies make up the city’s 2026 debt levy of $85,778. • The City Council contingency was increased to $15,000, up from $9,000. • The Clerk/General Government budget includes $55,000 for wages and $9,900 for health insurance coverage. • The Planning and Zoning budget increased $15,000, based on past expenditures. • The police budget increased 4.16% to $153,537, based on the City of White Bear Lake budget provided to us, and includes $139,470 for police services and $14,067 for debts payments on the new public facilities building. • The cost of fire services increased 1.22% to $53,474. It includes $35,196 for fire services, $9,087 for fire marshal services, and $9,191 for depreciation on the new public facilities building. Overall, the City of White Bear Lake is expecting Gem Lake to pay $23,258 for the next 20 years for their new facility. • The Road Maintenance budget includes $20,000 for road maintenance and $8,000 for trimming boulevard trees. • The salt/sand and plowing budget increased $1,500 to $25,000, based on past expenditures. • The Heritage Hall budget includes $20,000 for building improvements and $10,000 for other equipment and or improvements. • The park maintenance budget remains $10,000 for maintaining the trail and open space area in the southwestern area of the city. • The 2026 budget includes $20,000 for future improvements. • Other revenue and other expenditures line items have been adjusted based on past history. These changes resulted in the city proposed preliminary tax levy of $768,005 for 2026. This compares to 2025 preliminary levy of $733,757 and the 2025 final levy of $718,736. Using a 2026 property tax levy of $768,005, and the City’s 2026 estimated tax capacity ($1,884,274) and median valued home ($460,750) for Gem Lake, that median valued home would pay city property taxes of $1,806.40 in 2026, compared to $1,725.55 in 2025 (based on the 2025 preliminary tax levy), an increase of $80.85, or $126.03 if based on the final tax levy from 2025. The preliminary budget and property tax levy was approved at the September 16 Gem Lake City Council meeting. A copy of the preliminary budget for 2026 is available at Heritage Hall. Audit Results Presented When it comes to audit results, boring is good. Gem Lake’s recent audit results for 2024 were presented at the September 16, City Council City Council meeting and the outcome fit the bill. Boring The accounting firm of LB Carlson issued a clean opinion on the City’s financial statements. This means the firm felt financial statements were fairly presented and were in accordance with Generally Accepted Accounting Principles (GAAP). There were no instances of noncompliance with Minnesota laws and regulations. Overall, LB Carlson gave an “unmodified opinion” of the city’s basic financial statements, which is good. Two deficiencies were cited in internal control over financial reporting. One is due to inadequate segregation of duties, which is very typical in smaller cities. The other deficiency cited had to do with software conversion and error correction. Neither deficiency was considered major. In general, the accounting firm felt the City of Gem Lake had a solid general fund balance and stable net positions in all enterprise fund balances. A complete copy of the 2024 Audit is available at Heritage Hall.