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k" REQUEST FOR COUNCIL ACTION Date: 08/22/11 Item No.: 10 . a Department Approval City Manager Approval Item Description: Continue Discussion on the 2012-2013 Recommended Budget 11 BACKGROUND 2 Since the beginning of the year, the City Council has held 17 separate public discussions on the Budget and 3 Capital Improvement Plan. To ensure that future budget discussions remain productive, it is suggested that 4, the Council revisit some key budget decisions made in the past few years to gain added context for the 5 decisions that lie ahead. It is also suggested that the Council review some key milestones in this year's 6 budget process. "7 8 Budget and Tax Levy History 9 The following is a brief summary of the key budget decisions made in the past few years: 110 11 2,009 12 The 2,009 tax levy increased by $242',500, or 1.9% over t he previous year. The increase was 13 dedicated to new debt service on the ke Arena, which meant there was no new money foie 14, day-to-day operations. 15 116 However, this same year there were significant operating cost increases including new 1 7 contractual obligations, higher motor fuel' and energy costs, as well as added wage and 11 111",',':1'1111 healthcare costs. To offset these added costs, the Council eliminatedfundingfor the City's 119 general vehicle replacement program and appropriatedfundsfrom General Fund reserves. 20 In addition., due to the unexpected mid-year loss in MVHC reimbursement aid, the City made 21 over $400, 000 in operating budget reductions including the elimination of a number of 22 staffing positions. 2. 3 24, 2'010 25 The 2'010 tax levy increased by $1,143,544, or 8'. 7% over the previous year. The increase 26 was earmarkedfor thefollowing: 27 28 $100, 000 fear the remaining Ise Arena debt 29 $450, 000for MVHC replacement. funds 30 $400, 000 to restore vehicle replacemen Ifunding which had been eliminated in 200.9. 31 32 Page I of 4