2011-09-06_PR_Packet - Laserfiche WebLink

Home

million is being eliminated to balance the state's deficit, and the tax relief provided to homeowners under the new market value exclusion is in part due to shifts in property taxes that will occur. In Roseville, following the MVHC unallottment actions by the Governor & Legislature in 2008 & 2009, we reduced our annual city budget by over $474,000 in the spring of 2009. These budget cuts were spread across all tax supported operations. For FY 2010, a"MVHC Replacement Levy" of approximately $450,000 was included to offset the lack of MVHC reimbursement by the state (this was increased to $475,000 in FY 2011). Financially however, the "MVHC Replacement Levy" merely reinstated the previous years' reduced equipment replacement levy of$425,000 that had been eliminated during the final FY 2009 budget approval process. In effect, these combined actions resulted in a shift of$425,000 from operating budgets to fund the equipment replacement program. As you know, this is still inadequate to properly fund our asset replacement needs. As a result of this new legislation and change in MVHC program, the City will have an amount of levy that I'll refer to as "MVHC Replacement Levy" available for the upcoming biennial budget because the state will no longer have it taken from our levy amount.. To date, the 2012-2013 preliminary budget has been developed to focus on finally funding the Capital Investment Plan (CIP) to an adequate level with a $500,000 increase in the levy (3.4%) and a $387,000 reduction in expenses. With approximately $475,000 in "MVHC Replacement Levy" available,there is the opportunity that this budget approach can be modified. There are a few basic approaches that the City Council could consider: 1. Use the "MVHC Replacement Levy" to reduce the budget reductions and/or new levy amount. 2. Dedicate the "MVHC Replacement Levy" to future debt service payments (Fire, Parks & Rec.) 3. Keep the "MVHC Replacement Levy" amount and current budget plan intact, and replenish the General Fund reserves In reviewing the preliminary budget and proposed program/service reductions and CIP needs, I would recommend the following: 1. Use V2 of the "MVHC Replacement Levy" ($237,500) to mitigate the program/service reductions 2. Direct the other V2 of the "MVHC Replacement Levy"to the CIP, thereby reducing the "new" levy needed to $263,500. With these changes, we can restore the proposed FTE reductions and other programs like: the Parks & Rec. special events, Police Community Relations, Streets & bldg. maintenance. Some The resulting tax increase would be about 1.8%.