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Letter of Transmittal The Honorable Mayor and City Council Submitted, herewith, is the adopted 1987 Annual Budget. Introduction The intent of this letter is to provide a broad overview of the 1987 budqet, noting significant changes from the 1986 budget. The letter addresses four major areas: Assessed valuation, Levy and Millrate, Revenue, and Expenditures. The estimated assessed valuation for 1987, as of June 24, 1986, is $336,760,530. This is a decrease of $2,034,714 from the 1985 valuation of $338,795,244. The decrease is due to two major changes. A. The method of calculating the assessed valuation of residential property has been changed, resulting in a 2% decrease in the assessed valuation of a$100,000 home. This change has caused a$2,083,216 decrease in residential assessed valuation. B. There is a trend, among owners of commercial and industrial property, to apply for re-valuation of their properties. Many have been successful in obtaininq reductions in assessed valuations. The reductions have offset a portion of the increases due to new development. Levv and Mi11 Rate � The total 1987 budget is $14,004,671. This is an increase of $761,524 or 5.750 over 1986. Tax levy requirements to finance � this budget are $4,788,813, for an increase of �201,677, or 4.390. Based on the estimated assessed valuation and levy requirement, the mill rate of 1987 will be 14.22 mills, � compared to 13.58 mills in 1986, and 13.140 mills in 1985. It is expected that this tax levy amount will be within the levy limitation for 1987 based on our understanding of the levy limit calculation process. �� The 1987 budget will have a minimal impact on the taxes of Roseville homeowners. Taxes on the average valued home ($81,718) will increase 4.80 or $11.00. Taxes on a$100,000 home will increase 2.6% or $8.00. The lower increase on the higher valued home is due to a change in the method of calculating assessed value, which benefits higher valued homes. I