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Regular City Council Meeting Monday,June 13,2011 Page 25 Further discussion included clarifying that the levy would remain at the current level at $300,000, but spent on capital needs, not operational needs; $750,000 from reserves to endow the equipment replacement fund, coming from the one- time tax increment financing (TIF) repayment of approximately $1.2 million last year as a result of closing out the Center Pointe TIF District, with $236,000 used in 2011 for capital equipment and the rest in reserves; clarifying that the 3.4% levy increase would be the base to remain level for capital needs; with the sub- committee seeking input from the public and the remainder of the City Council on these recommendations to-date. Councilmember McGehee requested that the policy of setting aside a specific amount during each budget cycle (annually) as a method of continuing to ade- quately fund the CIP Budget be written and approved by the Council. This would enable and encourage future Councils to continue this policy so that Roseville can avoid this situation of underfunding in subsequent years." Mayor Roe clarified that this report is the first draft of such a policy. Councilmember Johnson concurred, noting that there would be additional recom- mendations to follow. Councilmember McGehee opined that this was only a miniscule part of the prob- lem; and while talking about taxes, the City needed to give serious consideration to looking at the City's tax capacity as it developed to alleviate the tax burden on residents. Councilmember McGehee referenced personal conversations she'd had with City Manager Malinen and Community Development Director Trudgeon; and their interest in developing tools, such as the possible creation of an Econom- ic Development Commission, to provide reports on economic costs/benefits of particular developments or programs. Mayor Roe clarified that this preliminary report is for information purposes only, and no formal action was requested at this time,but that subsequent actions would follow as part of the budget process; and may include a policy resolution for adoption after further consideration. City Manager Malinen encouraged that any questions or concerns about this ap- proach be provided to the subcommittee; however, he acknowledged that there appeared to be a general consensus in support. Mayor Roe noted that, in reviewing the budget calendar and process, there would be several opportunities for public comment once the City Council received the City Manager-recommended budget for 2012/2013 on July 11, 2011; including their input on capital needs funding. b. Continue Discussions on a Preliminary 2012 Tax Levy