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City Council Regular Meeting —12/04/06 DRAFT Minutes - Page 3 respectfully requested that the City of Roseville consider the cumulative impact of other taxing jurisdictions, and consider decreasing the proposed five percent (5%) levy increase for 2007. b. Al Sands, 2612 Aldine Mr. Sands provided a Bench Handout entitled, "City of Roseville, 2007 Proposed Budget Review," based on his interpretation of the City Manager proposed budget letter dated July 10, 2006 and subsequent memo dated October 23, 2006. Mr. Sands addressed residential versus comme�cia� valuations; questioned the need for an additional $111,000 reserve funds; and encouraged Councilmembers to "clean up" the loose ends in the budget recommendations prior to the December 18, 2006 fmal levy adoption; and spoke in support of a four percent (4%) levy increase. Mr. Sands recognized that the City's annual levy was unusually low due to the interest earnings available fro�n the City's reserve funds; and complimented past Council's for their action in building these reserves, specifically noting the Pavement Management Plan (PMP) reserve fund. Mr. Sands encouraged senior citizen taxpayers to review their tax statements when received in March to determine if they were eligible for a rebate; and suggested City staff assistance to taxpayers if requested. c. Interim City Manager and Finance Director Chris Miller At the request of Mayor Klausing, Mr. Miller addressed the rationale for continuing to add to reserve funds. Mr. Miller reviewed, from the slide presentation, factors attributable to the levy increase, including General Inflation — all service inputs; eliminating the use of reserves; additional funds for vehicle replacements; additional funds for parlc improvements; and other funding. Mr. Miller advised that the proposed funding was to replenish funds previously removed from reserves to correct a structural imbalance between expenses and revenues. Mr. Miller advised that continuing drawdown of these reserves on an annual basis was not sustainable, and further eroded funding mechanisms.