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REQUEST FOR COiTNCIL ACTION Date: 10/23/00 Item No.: F- 5 me �pprovaL ManagerReviewed Agenda Section � � �� Reports and Recommendations Description: Resolution Regarding City Tax Rate for 2001 Background Under Minnesota State Statutes Section 275.078, the County Auditor must provide to each City the tax capacity values for the pay 2001 budget year. On the basis of those numbers, the City is required to compute the projected tax capacity rate for 2001 and compare it to the current tax capacity rate for 2000. If the rate is projected to be higher in 2001, the City Council must pass a resolution authorizing the higher rate in preparation for the truth-in-taxation (TNT) hearings . On the basis of the proposed city budget, the tax rate is calculated to be higher in 2001 than 2000. This calculation does not take into consideration the increased `properry values proj ected for 2001. The resolution is required, even if the actual rate is less, upon final Council approval in December. Policy Implications While this resolution is a statutory requirement, the City's budgetary policy is to provide for a reasonable levy increase to maintain city services in line with other Council policies of providing for the common good of the community. This resolution is within the Council's operating budget policies as well as is reflective of their Goals and Obj ectives. Financial Implications Approval of this resolution will continue the budgetary process put in place by the Council and permit the discussion and budget finalization to take place after the TNT hearing in December. Staff Recommendations Staff is recommending that the City Council approve the attached resolution, with the understanding that the Council has the flexibility of adjusting the tax rate prior to final approval in December. Council Action Motion to approve the attached resolution authorizing a proposed Tax Rate Increase for 2000 Levy payable in 2001.