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City of Roseville — 2012 Budget Financial Plan — Executive Summary Enclosed is the 2012 -2021 Financial Plan as prepared in accordance with the goals and strategies identified in the Imagine Roseville 2025 initiative and in consideration of the policies, goals and objectives identified by the City Council. Like the Capital Improvement Plan (CIP), the Financial Plan should not be construed as a request for funding; rather it is designed to serve as a planning tool that can be used to make informed financial decisions. The Financial Plan is segregated into two portions; operations and capital investments. While both portions are crucial for maintaining services, the potential for alternative funding sources and the flexibility in making operational adjustments can vary significantly for each. Therefore they are looked at separately for financial planning purposes. In addition, the Financial Plan makes the distinction between general - purpose operations that are used to provide police, fire, streets, and parks & recreation, and are typically funded by property taxes; and enterprise or business -type operations that are used to provide for water, sewer, storm, and golf course operations which are typically funded by user fees. Each of these separate categories is discussed in greater detail below. If current operational trends continue and if the City makes all planned capital replacements over the next 10 years, it will create a sizeable impact on Roseville property owners. In adopting the 2012 Budget, the City Council recognized this impact and instituted significant increases in the water and sewer rates and re- purposed existing property tax levies. This resulted in substantial improvement in the City's asset replacement funding mechanisms However, in order to maintain programs and services at existing levels and to replace infrastructure at the optimal time, property tax levies will need to increase by 2-3% per year for the next 10 years. Water and Sewer rates will need to increase by 30% per year in 2013, followed by more moderate increases thereafter. Under this scenario, a typical single - family home will see their combined City property tax and utility bill increase from $1,134 in 2011 to $2,109 in 2020. These impacts can be lessened if the City chooses to eliminate programs, reduce service levels, or delay capital replacements. With these projections, Roseville would no longer be among the lowest taxed cities in the Twin Cities Metropolitan Area. It is estimated that Roseville will go from having the 7th lowest taxes out of 60 comparative cities, to having the 25th to 30th lowest. This would place Roseville near the median taxation level. For comparison purposes, the cities currently near the median include: Bloomington, St. Louis Park, Burnsville, New Brighton, and Mounds View. The impacts noted above can also be portrayed as a percentage of household income. Based on the projections above, it is estimated that each household will pay approximately 2.0% of their income to the City for property taxes and their utility bill in 2021. By comparison, Roseville households paid 1.5% of their income in 2002 and an estimated 1.3% in 2010. More detailed information is presented below. 82