City of Orono, Minnesota Annual Budget

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1 , Minnesota 2019 Annual

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3 2019 Annual Table of Contents Section 1: Introduction & Summary Introduction/ Summary... 1 Fund and Department Descriptions... 7 Resolutions Tax Levies Effect of the on Residential Homes General Fund Revenues General Fund Expenditures Summary of all Funds Outstanding Debt Debt Projection Section 3: Operating s General Fund Department Summaries General Fund Line Items Enterprise Fund Summaries Enterprise Fund Line Items Section 2: Changes in Fund Balance/Retained Earnings Summary General Fund Special Revenue Funds Debt Service Funds Capital Project Funds Enterprise Funds... 61

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5 Process The budget process began at the beginning of June. At a work session held on June 25th the Council was provided background information on the budget and an overview of the budget challenges for Over the summer, a draft budget was prepared and reviewed by the Council at work sessions in July and August. In September the preliminary budget and tax levy was publically presented at the meeting of August 27th and adopted at the September 24th council meeting. Prior to the adoption of the 2019 budget and tax levy, the City is required to hold a public hearing to allow public input on the budget and tax levy. By law, this hearing must occur between November 24th and December 28th. When the preliminary tax levy and budget was approved in September, the public hearing was set for December 10, 2018 at 6:30. The final budget and tax levy was adopted at the conclusion of the public hearing. In addition to the work on the actual budget, staff has been working on updating the Capital Improvement Plan (CIP). The CIP identifies the long-term infrastructure needs and is a valuable tool in the budgeting process. The CIP was also approved as part of the December 10 th meeting. In conjunction with the budget process, staff has also reviewed the fee schedule. Review of a majority of the fee schedule has been completed. The 2019 fee schedule, as amended, was adopted on December 10th with an amendment to be made in January 2019 for the 2019 water rates. Tax Levy The total tax levy required to fund the 2019 budget is $5,635,450. This is an increase of $195,499 or 3.59% over the 2018 levy. A portion of the increase to the levy, $161,450, is designated for funding the City s Pavement Management Plan to address the City s aging road infrastructure. The remaining increase of $34,049 is an increase to the General Fund operating levy. Even with the increase in the levy, the City s tax rate decreased from % to %. Orono continues to have one of the lowest tax rates in both Hennepin County (ranking 42 of 45 cities), and the State of Minnesota. The tax levy is used to fund the general operations of the City (General Fund), pay the debt service on the City s outstanding bonds, and to fund the Pavement Management Fund. The breakdown of the 2019 levy is $711,000 for debt service, $544,450 for roads, and the remaining $4,380,000 is used in the General Fund. Tax Capacity Rate and the Impact of the Tax Levy on Property Owners The County Assessor provides an annual calculation of the City s tax capacity based on the annual property valuation. As of October 31, 2018, the City s taxable market value is $3,004,167,366 with a tax capacity of $34,109,993. When compared to last year, taxable market value has increased by 4.32% and the tax capacity by 4.68%. As a result of the City s increased tax capacity, the tax capacity rate will decrease from % in 2018 to % in Using this tax rate and assuming no change in a property s value, the City s share of the property tax bill would be: a decrease Page 1

6 of $4.16 (-1.07% on a home previously valued at $250,000; a decrease in tax of $8.85 (-1.07%) on a $500,000 home; a $1,000,000 home will see a decrease of $19.91 (-1.07%); and a $2,000,000 home has a decrease of $42.04 (-1.07%). The actual tax impact on any particular property depends on how the property s taxable value changed in relation to the rest of the City. Tables illustrating a 5% increase in value and a 5% decrease in value are included in this budget document. General Fund General Fund Expenditures The 2019 expenditure budget is $8,577,280 which is an increase of $383,879 (4.68%) over the 2018 budget. This increase is the result of a $95,000 increase in Personal Services, a $217,619 increase in Professional Services, and a $100,000 increase in Contingency. The increase in Personal Services is due to step increases and a COLA increase of 2.5% for union and non-union employees. The increase would have been larger but the wages for the IT Technician have been moved to the IT Internal Service Fund. The increase for Professional Services is due to some actual increases for Legal ($17,000), Engineering ($5,000) and Passthrough charges ($30,000). The majority of the Professional Services increase is due to a shift in coding as a result of the creation of the IT Fund. IT related expenditures that were previously coded to wages (IT Tech), Other Expenses, and supplies and maintenance are now coded to a new line item (IT Services) in the Professional Services category. The increase to Contingencies is due to reestablishing the line item that had been removed from the 2018 budget. General Fund Revenues For revenues the General Fund budget also totals $8,577,280 and is increasing by $383,880. The largest increase in revenues is the Administrative Charges for Service line $165,170. This revenue is from charges to other funds, mainly Water, Sewer, and Storm Sewer, for costs incurred by the General Fund in support of the other funds. Other increases are Property Taxes ($34,950), Building Permits ($29,000), Police State Aid ($20,000), Police Service Contracts ($62,000), and Interest on Investments ($41,000). There are other smaller increases for a total revenue increase of $383,880. Special Revenue Funds The special revenue funds that budgets are adopted for are the Park Fund, The Drug Forfeiture Fund, and the TIF Fund. Special revenue funds by definition have a primary source of revenue that is dedicated for a specific purpose. In the Park Fund the primary revenue source is park dedication fees collected from developers. By state law, these funds must be used for parkland acquisition and development. The Drug Forfeiture Fund receives its primary funding from the Police Department s drug and alcohol enforcement activities. The funds must be used for drug and alcohol related activities. The TIF Fund is used to account for revenues related to the Orono Woods Senior Housing Development. Debt Service Levies The 2019 levy for debt service is $711,000. This levy is used to pay the debt service on the City s three outstanding bond issues. The Series 2010 GO Improvement/Refunding Bonds, the Series Page 2

7 2014 GO Improvement/Refunding Bonds, and the Series 2016 GO Refunding Bonds. Enterprise Funds The Water, Sewer, Stormwater, and Recycling Funds are designed to account for the business type activities of the City. These funds do not receive any property tax revenue. The goal for the Enterprise funds is to be fully funded by rates without depending on special assessments for infrastructure improvements. While there is no formal adoption of the expenditure budgets, the information is included in the budget book. On the revenue side of the budget, the utility rates are approved annually as part of the fee schedule. The utility rate increases being recommended are Water 11%; Sewer 4%, Stormwater 10%, and Recycling by 11%. With the exception of the water rate increase, the utility rates have been approved on December 10 th, 2018 as part of the 2019 Fee Schedule. For water, the overall rate increase is 11%, however, staff is still working on developing a new rate structure to more accurately charge customers based on the water system that they are connected to (North, South, Wayzata, or Long Lake). Water The water fund has historically been operating at a loss. Because depreciation is a non-cash expenditure, the fund has had a positive operating cash flow since In previous years, the operating loss has been covered by the revenue received from antenna leases on the water towers. The revenue from the antenna leases has been moved out of the Water budget and this revenue decrease will be recovered through water rates. As presented, the operating budget for 2019 will have an operating loss of $181,120. The expenditure budget is increasing by $217,732 (34.29%). $86,660 of the increase is due to an increase in Administrative Charge. The operating transfer of $55,000 is to the debt service fund supporting the Casco Point Bonds ($55,000). The non-operating interest expense is for the interest on the water portion of the 2014 bonds capital expenditures as identified in the draft CIP include painting the north and south water plant, well #3 screening, a water main replacement at CSAH 15/19, water valve replacements and water meter replacements. The 2019 capital expenditures total $474,855. Sewer In recent years, the sewer fund has mostly operated at a loss. Nonoperating revenues however, have consistently offset the operating losses. This has resulted in a positive operating cash flow for the fund. The single largest expense for the sewer fund is the Met Council disposal charges. The past three years have seen increases in the amount of $37,410 (9.5%), $41,277 (9.6%) and $123,425 (28.6) respectively. This is a 40% increase over the period. As has been discussed with the Council during previous budget processes, heavy rains and high water tables increase the flow through the MCES lift stations and increase our disposal charges. The total operating expenditure budget is increasing by $213,675 (15.2%) The major increases are the previously mentioned MCES charges ($123,425), repairs and maintenance for sewer lines ($57,280) and the Administrative Charge ($70,660). The operating Page 3

8 transfer is to cover the sewer improvements that were part of the Casco Point project and will continue through Upcoming capital expenditures can be covered by the fund s current cash balances. Projects identified in the CIP for 2019 include: Annual sewer rehabilitation ($281,377), Sewer televising ($48,690), additional generators ($150,000), lift station updates ($116,000); lift station monitoring improvements ($26,000), sewer main replacements ($198,000), and a generator rehabilitation ($10,000), for a total of $820,068. Stormwater The Stormwater Fund is for the most part project based. Operating expenditures are mainly limited to engineering associated with NPDES, SWPPP and other state and federal requirements. Public Works time and materials spent on culvert cleaning/replacement are also charged to this fund. The purpose of this fund is to collect money for the larger Stormwater projects that will be required in the future. Potential CIP projects in 2019 include: Watershed Delineation and Pond Assessments ($10,000), Forest Arms Lane ($69,324), East Long Lake S ($63,515), Tonkaview Lane ($87,531), Chevy Chase Drive ($146,330), East long Lake Road N ($82,000), Storm Sewer Improvements ($200,000), TMDL Updates ($50,000), and OCB pipe upsizing (88,500). The capital expenditures total $798,200. Recycling The recycling funds major expenditure line is for contracted recycling charges. The current contract with Waste Management is increasing 2.5% increase. The Recycled Materials offset that the City was receiving in has not been being paid in The offset is based on the market for recycled materials which weakened it The full time wages that are charged to the fund represent 10% of the City Clerks wages. Cable The Cable funds projected revenues are based on current subscriber information and rates. The line item for Internet/Other communications covers the costs associated with streaming and online access of council meetings. It has been increased to pay for the increased cost of our fiber internet connection. Revenue for the fund is in the from franchise fees that are set by the City s franchise agreement with Mediacom. Capital Expenditures in 2019 will include upgrades to the presentation equipment in the Council Chambers. Construction Funds The City does not adopt formal budgets for construction funds. Possible projects for these funds can be found in the CIP. The CIP is a planning tool only; approval of the CIP not approve or authorize any purchases. The projects identified in it will require individual approval from the Council before they can be started. Capital Improvement Plan In 2012 the City formally adopted a Capital Improvement Plan (CIP). In order to keep the CIP useful, it is updated on a yearly basis. The CIP is a planning document only and approval of the CIP does not constitute approval of any expenditures. There are two main focusses of the CIP. First is the CIP items that have been identified as needs by staff. The Second is available funding for the CIP. Many funding sources are not adequate to Page 4

9 fund the CIP items so funding will need to be secured prior to moving forward with the projects. The funding for the Street CIP includes an additional $300,000 in tax levy starting in In that year, the levy needed for debt service will decrease by $300,000 and by transferring the levy to the CIP, there will be adequate funding for roads. This increased levy for the CIP will require Council approval at that time Page 5

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11 Fund and Department Descriptions City s can be confusing due to the number of funds and departments involved. The following descriptions of the General Fund departments and the other funds maintained by the City is designed to give the user of this document a basic understanding of the purpose of each department and fund. General Fund This is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. The General Fund budget is made up of the following departmental budgets: Mayor and Council The City Council oversees the policies and procedures that govern the City in promoting the health, safety, and general welfare of the citizens of Orono. This budget includes the wages and employment taxes of the Council; memberships in the League of Minnesota Cities, Metro Cities, and the Suburban Rate Authority. Administration The Administration Department includes the City Administrator who is responsible for meeting statutory and legal obligations, implementing policy established by the City Council and ensuring the successful management of all city operations. The City Clerk and the rest of the administrative staff perform various functions such as: customer service, permits and licensing, elections, record management, and general administrative duties. Elections The Elections Department administers all federal, state, county, and municipal elections held in the city. Elections are held in even numbered years. Assessing The Assessing Department performs assessing services in accordance with the requirements of the State of Minnesota. The City maintains a contract with Hennepin County for assessing services. Finance The Finance Department oversees the City s financial operations, risk management, and employee benefits. It is responsible for preparing the budget and Comprehensive Annual Financial Report in accordance with generally accepted accounting principles. Legal The Legal Department includes professional representation and opinion on city services and operations, prosecution services, and jail charges. The City maintains renewable contracts with both a civil law firm and a prosecutor for legal services. Central Services The Central Services provides for those operating expenses that encompass all General Fund city departments with the exception of the Police Department. Expenditures include supplies, utilities, municipal insurance coverage, janitorial, and building maintenance. Human Services The Human Services Department contracts with area organizations to provide for valuable services for the community. Current contracts are with The Gillespie Center for senior services and Orono Community Education for summer recreation programs Page 7

12 Police The Police Department provides for the public safety within Orono and surrounding communities. The City has renewable contracts with the Cities of Spring Park, Minnetonka Beach, and Mound. Due to the contractual agreements the department operates as a cost center and is the only General Fund department that has expenditures for costs that are normally covered by Central Services. This budget is also the only one within the General Fund that includes capital expenditures. Fire the expenditures of the Fire Department are comprised of renewable contracts with the Cities of Long Lake and Wayzata for fire suppression services. Planning and Zoning The Planning and Zoning Department oversees the development and redevelopment within the City, including building inspections, in accordance with established policies and guidelines. The policies and guidelines have been created to maintain the health, safety, and welfare of the public, as well as maintaining the aesthetics of the community. Engineering The Engineering Department provides professional representation and opinion on city services and operations. This function is provided by a local engineering firm that is retained on a contract basis. Street Maintenance The Street Department provides for the maintenance of all city streets to ensure a safe and drivable condition. Standard maintenance includes, patching, snow plowing, and striping. Parks and Recreation The Parks and Recreation Department provides for the maintenance of the City s parks. Golf Course The Golf Course provides golfing opportunities for both residents and visitors to the City. During the winter months the course is open to sledding. Special Services The Special Services Department is used to account for expenditures that benefit a single property or organization. An example of this type of expenditure is the legal and engineering fees incurred as the result of a request for a variance, a subdivision application, or other major development. Other expenditures that are included in this department are requests for additional police security or traffic control related to an event. The costs recorded in this department are offset by revenues received for the services provided. Special Projects and Contingencies The Special Projects and Contingencies Department budget include the annual operating transfer to the Improvement & Equipment Outlay Fund for the purchase of capital equipment for General Fund Departments other than for the Police Department. The department also includes an amount for any unforeseen circumstances that produce additional expenses or revenue shortfalls Page 8

13 Special Revenue Funds Special Revenue Funds provide for funding of expenditures that are primarily funded by a revenue source that is not part of the general tax levy and has a restricted use. Park Fund The Park Fund s major revenue source are Park Dedication Fees collected as part of a subdivision or major development process. By state law fees received must be placed in a special fund and can be used for specific purposes. Park dedication fees must be used only for the acquisition and development or improvement of parks, recreational facilities, playgrounds, trails, wetlands, or open space based on the approved park systems plan. Senior Housing TIF Fund The Senior Housing TIF Fund was created to provide housing opportunities for seniors within the City. Its major revenue source is the additional property taxes collected on the captured value of the property. 90% of the funds collected are forwarded to the developer to help pay for the bonds associated with the project. Drug and Felony Forfeiture Fund The Drug and Felony Forfeiture Fund s major sources of revenue are the sale of DWI forfeited vehicles and revenue received from drug enforcement activities. The funds are restricted for law enforcement activities related to alcohol and drug enforcement Page 9

14 Debt Service Funds Debt Service Funds are used to pay for debt service on the City s outstanding bonds. Funding for debt service funds can include: property taxes; special assessments, debt support from other funds; or a combination of the three General Obligation Bonds The 2010 bonds were issued for multiple purposes: to refund the 2003 HRA Public Facility Bonds (Navarre Fire); to fund the reconstruction of Old Crystal Bay Road; and to fund the reclamation of Orono Orchard Road. The refunding portion of the bond issue save the City an estimated $47,125. Funding is a combination of property taxes and Municipal State Aid money from the State of Minnesota 2014 General Obligation Bonds The 2014 bonds were issued for multiple purposes: to refund the 2005 HRA Public Project Revenue Bonds (Big Island); to fund water infrastructure improvements including a new well; and to fund the construction of the Public Safety Garage. Funding is a combination of property taxes; water revenues; and a transfer from the General Fund related to revenues from the Mound police service contract General Obligation Refunding Bonds The 2016 bonds were issued to refund the 2008 General Obligation Street Reconstruction Bonds. The refunding of the 2008 bonds resulted in interest savings of $220, Page 10

15 Capital Project Funds Capital project funds are used to account for the financing of street projects, equipment replacement, public safety equipment, and facility rehabilitation or renovation. Revenue sources are provided mainly through transfers, special assessments, and bond sales. Municipal State Aid (MSA) Fund The MSA Fund provides for the improvement of designated state aid streets which are funded by State of Minnesota funds. Permanent Improvement Revolving (PIR) Fund The PIR Fund is designed to provide temporary financing of projects until permanent financing is available. Improvement & Equipment Outlay Fund The Improvement & Equipment Outlay Fund provides for the purchase of equipment and the construction or renovation of City facilities. Community Investment Fund The Community Investment Fund provides funding for projects of citywide importance that have no other funding source Page 11

16 Enterprise Funds Enterprise Funds are used to account for the business type activities of the City. These include the following funds: Water, Sewer, Stormwater, and Recycling. Water The Water Fund is used to account for the City s utility. The system consists of two water towers, three wells, 18 miles of water mains, and serves 986 customers. Sewer The Sewer Fund is used to account for the City s sewer utility. The system consists of 47 miles of sewer lines and 46 pumping stations, and serves 2,194 customers. The largest expense for the fund is a charge from the Metropolitan Council Environmental Services to pay for their collector lines and the treatment of the wastewater. Cable TV The Cable TV Fund was created to account for revenues collected as part of the franchise agreement between the City and Mediacom. Stormwater The Stormwater Fund is used to account for the City s stormwater utility. The system consists of culverts, collection ponds, and drainage ways. The utility was created in order to provide funding needed to comply with State and Federal mandates regarding stormwater. All properties within the city are charged a stormwater fee. Recycling the city contracts with Waste Management to provide for curbside recycling service. Funding is provided through a combination of a grant from Hennepin County and user fees. In addition the city coordinates a spring cleanup day to assist residents who have materials unsuitable for recycling or regular waste service Page 12

17 Internal Service Funds Internal Service Funds are used to track revenue and expense shifts between departments. These include the following funds: Insurance, Fleet Management, Compensated Absences, and Information Technology. Insurance - The Insurance Fund was created to account for total insurance revenue and expenses between all departments. Fleet Management The Fleet Management Fund is used to account for total expenses related to city vehicles. Each fund pays into this fund to cover their appropriate portions of expenses. Compensated Absences The Compensated Absences Fund is used to account the liability owed to employees for compensated absences such as Sick, Vacation, Overtime and Comp-Time. Information Technology (IT) - The IT Fund is used to account for total expenses related to software and technology. Each fund pays into this fund to cover their appropriate portions of expenses Page 13

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19 O CITY OF ORONO RESOLUTION OF THE CITY COUNCIL kesho' No A RESOLUTION TO ADOPT THE FINAL 2019 GENERAL FUND BUDGET BE IT RESOLVED, by the City Council of the, County of Hennepin, Minnesota that the fina12019 General Fund budget is determined to be as follows: ESTIMATED REVENUES Taxes- General 4, 390, 000 Licenses and Permits 496, 750 Intergovernmental 270,220 Charges for Services 3, 037, 900 Fines and Forfeits 80, 100 Interest Income 96,410 Recreation Fees 176, 000 Miscellaneous 29, 900 TOTAL APPROPRIATED EXPENDITURES General Government 1, 370,000 Public Safety 5, 433, 180 Street Maintenance 513, 180 Parks and Recreation 431, 170 Engineering - Unallocated 20,000 Reimbursable Expenditures 125, 750 Special Projects and Contingency 100, 000 Capital Outlay 184, 000 Transfers to Other Funds 400, 000 TOTAL Adopted by the City Council of the, Minnesota at a regular meeting held December 10, ATTEST: Anna Carlson, City Clerk Dennis Walsh, Mayor Page 15

20 0 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL kfsxo`' No A RESOLUTION ADOPTING THE FINAL 2019 PROPERTY TAX LEVY BE IT RESOLVED, by the City Council of the, County of Hennepin, Minnesota, that the following sums be levied for the current year, collectible in 2019 upon the t able property in the, for the following purposes: General Fund - Operating 4, 380,000 Pavement Management Levy 544,450 G.O Improvement Bond , 725 G.O. Improvement Bond , 300 G. O. Improvement Bond , 975 TOTAL ALL LEVIES The City Clerk is hereby instructed to transmit a certified copy of this resolution to the County Auditor of Hennepin County, Minnesota. Adopted by the City Council of the, Minnesota at a regular meeting held December 10, ATTEST: 1 nna Carlson, City Clerk Dennis Walsh, Mayor Page 16

21 0 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL t kes H R No A RESOLUTION TO ADOPT THE 2019 SPECIAL REVENUE FUND BUDGETS BE IT RESOLVED, by the City Council of the, County of Hennepin, Minnesota that the 2019 Special Revenue Fund budgets are determined to be as follows: Drug/Felony Estimated Revenues Park Forfeiture TIF T es General 77, 000 Interest Income 5, 000 1, 000 User Fees/ Loan Payment 25, 000 Park Dedication Fees 5, 500 Intergovernmental Transfers from other Funds Use of Fund Balance 329, 000 Total Revenues Appropriated Expenditures General Government 60,000 Public Safety 20, 000 Streets Parks & Recreation 339, 500 Transfers to Other Funds to Fund Balance 6, , 000 Total Expenditures Adopted by the City Council of the, Minnesota at a regular meeting held December 10, ATTEST: Anna Carlson, City Clerk Dennis Walsh, Mayor Page 17

22 g" kesh R O CITY OF ORONO RESOLUTION OF THE CITY COUNCIL No A RESOLUTION TO ADOPT THE 2019 ENTERPRISE FUND BUDGETS BE IT RESOLVED, by the City Council of the, County of Hennepin, Minnesota that the 2019 Enterprise Fund budgets are determined to be as follows: Estimated Revenues Water Sewer Recycling Stormwater Cable Charges for Service 671, 550 $ 1, 372, 010 $ 110, 290 $ 281, 160 $ 76, 000 Interest Income 10, , , 000 1, 000 Non- Operating 20, , 500 Total Revenues O , Appropriated Expenditures Operating Expenses 852, 670 $ 1, 624, 175 $ 134, 530 $ 356, 810 $ 67, 030 Non-Operating Expenses Interest Expense 22, 040 Debt Service 80, 000 Transfer to Other Funds 55, , 000 Total Expenditures Adopted by the City Council of the, Minnesota at a regular meeting held December 10, ATTEST: Anna Carlson, City Clerk Dennis Walsh, Mayor Page 18

23 Local Levy 2019 Over / Under Amount Percent TAX LEVIES General Fund $4,345,951 $4,380,000 $34, % Pavement Management 383, ,450 $161, % GO Improvement , ,725 $2, % GO Improvement , ,300 -$8, % GO Improvement , ,975 $6,445 NA Total Local Tax Capacity Rate $5,439,951 $5,635,450 $195, % Page 19

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25 Effect of 2019 Tax Levy & on Residential Properties No Change in Value Estimated Estimated Estimated Estimated Value $250,000 $250,000 $500,000 $500,000 $1,000,000 $1,000,000 $2,000,000 $2,000,000 MVE $14,740 $14,740 $0 $0 $0 Tax Value $235,260 $235,260 $500,000 $500,000 $1,000,000 $1,000,000 $2,000,000 $2,000,000 Levy Tax Capacity (Net) * Tax Capacity Rate Net City Tax $ from 2018 % from % 4.49% 4.49% 4.49% 2,353 2,353 5,000 5,000 11,250 11,250 23,750 23, % % % % % % % % $ $ $ $ $1, $1, $3, $3, $4.16 -$8.85 -$ $ % -1.07% -1.07% -1.07% * Tax Capacity (net) = 1% of first $500,000 market value, plus 1.25% of all value over $500,000 ** Assumes no change in value Page 21

26 Effect of 2019 Tax Levy & on Residential Properties 5.0% Decrease in Value Estimated Estimated Estimated Estimated 2019 Value $250,000 $237,500 $500,000 $475,000 $1,000,000 $950,000 $2,000,000 $1,900,000 MVE $14,740 $15,865 $0 $0 $0 Tax Value $235,260 $221,635 $500,000 $475,000 $1,000,000 $950,000 $2,000,000 $1,900,000 Levy Tax Capacity (Net) * Tax Capacity Rate Net City Tax $ from 2018 % from % 4.49% 4.49% 4.49% 2,353 2,271 5,000 4,688 11,250 10,625 23,750 22, % % % % % % % % $ $ $ $ $1, $1, $3, $3, $ $ $ $ % -7.25% -6.57% -6.28% * Tax Capacity (net) = 1% of first $500,000 market value, plus 1.25% of all value over $500,000 ** Assumes a 5.0% decrease in value Page 22

27 Effect of 2019 Tax Levy & on Residential Properties 5.0% in Value Estimated Estimated Estimated Estimated Value $250,000 $262,500 $500,000 $525,000 $1,000,000 $1,050,000 $2,000,000 $2,100,000 MVE $14,740 $13,615 $0 $0 $0 Tax Value $235,260 $248,885 $500,000 $525,000 $1,000,000 $1,050,000 $2,000,000 $2,100,000 Levy Tax Capacity (Net) * Tax Capacity Rate Net City Tax $ from 2018 % from % 4.49% 4.49% 4.49% 2,353 2,489 5,000 5,313 11,250 11,875 23,750 25, % % % % % % % % $ $ $ $ $1, $1, $3, $4, $18.11 $42.33 $82.45 $ % 5.11% 4.43% 4.14% * Tax Capacity (net) = 1% of first $500,000 market value, plus 1.25% of all value over $500,000 ** Assumes a 5.0% in value Page 23

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29 2019 Revenue Summary Revenue Source Y-T-D Aug 31, Percentage Current Ad Valorem Taxes 4,172,237-4,345,050 4,380,000 34, % Delinquent Ad Valorem Taxes (15,814) - 10,000 10, % Fiscal Disparities 32, Personal Property Tax 16, Forfieted Tax Sale Apportionmt Rent Credit Penalties and Interest-Taxes 1, Property Taxes 4,207,227-4,355,050 4,390,000 34, % Beer & Liquor Licenses 7, ,000 7, % Cigarette Licenses 1, % Garbage Haulers Licenses 1,110 1,095 1,100 1, % Other Business License/Permit 7,352 9,300 5,400 6,500 1, % Dog Licenses 1, N/A Total Licenses 18,442 11,175 13,900 15,000 1, % Building Permits 486, , , ,000 29, % Zoning Permit 1, ,750 1, % Mechanical/Septic/Other 76,833 77,929 55,000 55, % Plumbing Permit 29,979 28,702 25,000 25, % Total Permits 594, , , ,750 29, % Federal Grant-other N/A Market Value Credit N/A Police State Aid 223, , ,000 20, % Police Training Reimbursement 12,749 27,753 23,000 23, % PERA State Aid 7,219 3,610 7,220 7, % State Grant-other 16,915 12,671 10,000 20,000 10, % Total Intergovernmental 260,747 44, , ,220 30, % Administrative Charges for Svc 69,000 34,500 80, , , % General Taxable Sales/Service ,000 1, % Assessments searches % Plan Check/Site Exam Fees 302, , , , % Cond Use-Variance-Dev Fees 45,345 19,005 10,000 17,000 7, % Engineering & Legal Fees 91,341 56,249 40,000 40, % Bldg Permits-mail in fees % On-site Septic Program fees 44,738 45,000 44,500 44, % Coop Agreement-public works 385 1,241 3,000 3, % InterDepartmental Services-PW N/A Off Leash Annual Pass 16,545 13,638 10,000 12,000 2, % Total Gen Govt Service Charges 571, , , , , % Coop Agreement-inspection 18,749 3,990 20,000 20, % Coop Agreement-police 2,297,108 2,119,980 2,308,830 2,370,830 62, % Police Special Services 98,068 93,653 80,000 90,000 10, % False Alarm Fees ,000 2, % Police Reports % Police Reserve Receipts % Total Public Safety Service Charges 2,415,004 2,218,561 2,411,980 2,483,980 72, % Other Fines N/A Court Fines 67,149 44,427 80,000 80, % Drug Task Force N/A Dog Impound Fees % Total Fines and Forfeits 67,209 44,567 80,100 80, % Interest on investments 44,907-54,000 95,910 41, % Interest-NOW account % Total Investment Revenue 45, ,500 96,410 41, % Green Fees 124,953 96, , , % Rental-Golf carts & Club 49,972 39,798 49,000 49, % Beer Sales 9,704 8,494 8,000 8, % Pop Sales N/A Concessions-taxable 6,072 4,137 6,000 6, % Golf Ball Sales (11) N/A Pro Shop-taxable 2,681 1,775 3,000 3, % Pro Shop-nontaxable N/A Other Golf Course Receipts 1, N/A Cash Over/Short - (4) N/A Total Golf Course Receipts 195, , , , % Utility Penalties 1,750 1,980 1,500 2, % Page 25

30 2019 Revenue Summary Revenue Source Y-T-D Aug 31, Percentage Miscellaneous Revenue 28, ,000 3, % Rent Income 4,950 4,050 5,400 5, % Contributions & donations - 2, N/A Refunds & Reimbursements 3,958 19, % Sale of Equipment 38,738 21,597 15,000 15, % Filing fees-elections/plats 3,000 1,056 4,000 4, % Total Miscellaneous Revenue 81,335 50,897 29,400 29, % Total Revenue 8,457,054 3,408,117 8,193,400 8,577, , % Page 26

31 2019 General Fund Revenue Taxes 51% Recreation Fees 2% General Govt Service Charges 6% Public Safety Charges 29% Permits 6% Fines and Foreits 1% Other Revenue 2% Intergovernmental Revenue 3% Page 27

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33 2019 General Fund Major Expenditure Categories Y-T-D Oct 31, Mgr Recommd Dollar % Personal Services 5,044,050 4,216,054 5,374,087 5,469,740 95, % Supplies & Maintenance 553, , , ,110 (12,020) -1.89% Insurances 99,220 74,279 98, ,810 24, % Professional Services 1,156, ,222 1,069,381 1,287, , % Other Expenses 394, , , ,720 (45,913) % Capital Outlay 203, , , ,000 (16,000) -8.00% Transfers to Other Funds 927, , ,000 20, % Contingencies 57, , ,000 N/A Purchases for Resale 11,220 8,909 13,900 13, % Total 8,447,977 6,125,071 8,193,401 8,577, , % Page 29

34 2019 General Fund Major Expenditure Categories Supplies & Maintenance 7% Insurances 2% Other Expenses 4% Personal Services 64% Capital Outlay 2% Transfers to Other Funds 5% Professional Services 15% Contingencies 1% Page 30

35 2019 General Fund Departmental s 2018 Y-T-D Oct 31, Mgr Recommd Dollar % Mayor & Council 85,150 85,898 85,165 71,162 34,030 (51,135) % Administration 297, , , , , , % Elections 3,160 2,393 25,552 8,776 7,160 (18,392) % Assessing 180, , , , ,000 3, % Finance 323, , , , ,050 (58,876) % Law/Legal Services 104, , ,000 91, ,000 17, % Central Services 265, , , , ,890 36, % Human Services 12,400 11,099 12,400 12,125 12, % Police 4,236,760 4,041,833 4,369,035 3,278,060 4,519, , % Fire Protection Services 397, , , , ,100 12, % Building & Zoning 762, , , , ,910 (43,819) -5.92% Engineering 20,000 54,476 15,000 13,342 20,000 5, % Street Maintenance 499, , , , ,180 (12,713) -2.42% Parks 116, , , , ,440 45, % Golf Course 172, , , , ,730 39, % Special Services 95, ,345 95, , ,750 30, % Special Projects-Contingencies 40,990 57, , ,000 N/A Transfers to Other Funds 375, , , ,000 20, % Total General Fund Expenditures 7,988,364 8,445,340 8,193,401 6,125,071 8,577, , % Page 31

36 PROFESSIONAL SERVICES 4% 2019 General Fund POLICE 53% GOLF COURSE 3% CENTRAL SERVICES 3% CITY COUNCIL 0% TRANSFERS TO OTHER FUNDS 5% SPECIAL SERVICES 1% OTHER 1% PARKS 3% STREET MAINTENANCE 6% FINANCE 3% ADMINISTRATION 5% BUILDING & ZONING 8% FIRE 5% Page 32

37 Combined Summary of Revenues & Other Financing Sources For 2019 Transfers Special Licenses & Inter- Charges for Recreation Fines & Interest Misc. From Revenues and Property Tax Assessments Permits Governmental Services Charges Forfeits Income Revenue Other Funds Transfers In Total General Fund 4,390, , ,220 3,037, ,000 80,100 96,410 29,900-8,577,280 Special Revenue Funds Park ,000 5,500-10,500 Drug & Felony Forfieture ,000 25,000-26,000 Senior Housing - TIF 77, ,000 Capital Projects Funds PIR Fund , ,000 IEO Fund ,000 5, , ,000 MSA Fund , ,000 PMP Fund 544, ,450 Community Investment , ,000 Police Infrastructure Debt Service Funds 2010 Improvement Bonds 132, , , Improvement Bonds 165, , , , , Refunding Bonds 412, , , ,975 TOTAL GOVT FUNDS 5,722, ,750 1,013,358 3,037, ,000 80, ,410 65, ,000 11,278,368 Enterprise Funds Water Operating , , ,550 Sewer Operating ,372, ,000 20,000-1,427,010 Recycling Operating , , ,790 Storm Water Operating , , ,160 Cable Operating , , ,000 TOTAL ALL FUNDS 5,722, ,750 1,013,358 5,548, ,000 80, , , ,000 13,899, Page 33

38 Combined Summary of Expenditures & Other Financing Uses For 2019 Total Expend General Public Public Enterprise Capital Park & Debt Other Transfers To and Government Safety Works Operations Outlay Recreation Service Recycling Expend Other Funds Transfers Out General Fund 1,370,000 5,433, , , , , ,000 8,577,280 Special Revenue Funds Park , ,500 Drug & Felony Forfieture , ,000 Senior Housing - TIF ,000-60,000 Capital Projects Funds PIR Fund , ,305 IEO Fund , ,224 MSA Fund , ,000 PMP Fund ,056, ,056,295 Community Investment Fund Police Infrastucture Fund Debt Service Funds 2010 Improvement Bonds ,319-6, , Improvement Bonds ,325-6, , Refunding Bonds ,750-5, ,200 TOTAL GOVT FUNDS 1,370,000 5,433, ,180-2,578, ,170 1,160, , ,000 12,210,048 Enterprise Funds Water Operating , ,855-80, ,000 1,484,565 Sewer Operating ,624, , ,000 2,538,243 Recycling Operating , ,530 Storm Water Operating 356, , ,065,185 Cable Operating , ,030 TOTAL ALL FUNDS 1,370,000 5,433, ,180 3,057,255 4,565, ,170 1,240, , ,000 17,499, Page 34

39 Report of Outstanding Indebtedness As of December 31, 2018 Fund 321 Fund 322 Fund Total Imp/Ref Imp/Ref Ref All Issues Bond Type: Bonds Outstanding 1/1/18 2,045,000 3,980,000 2,680,000 8,705,000 Bonds Issued Bonds Paid or Refunded -200, , , ,000 Bonds Outstanding 12/31/18 1,845,000 3,650,000 2,470,000 7,965,000 Anticipated Isuances Payments Due , , , ,000 Projected Outstanding ,640,000 3,350,000 2,005,000 6,995, Page 35

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41 Debt Issue 2010 MSA, PMP, Refunding Tax Levy MSA Funds 2014 Garage, Water, Refunding Tax Levy Transfers - Contract Revenue Water Fund - Portion 2016 GO Refunding Bonds Tax levy Transfer - Water Transfer - Sewer Current Debt Service Sources , , , , , , , , , , , , , ,688 26, , , , , , , ,413 26, , , , , , , , , , , , ,000 60, , , , , ,430 98, ,550 99, ,920 99, , , , , , , , , , , , , , , , ,675 55,000 55,000 55,000 55, , , , , , , , , , , , , , , , , , , ,500 Total Levy Required Total Transfers & Water Fund Total MSA Total 711, , , , , , , , , , , , , , ,430 98, ,550 99, ,920 99, , , , , , , , ,688 26, ,219,518 1,219,543 1,177,843 1,118, , , , , , , , Page 37

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43 Summary of Fund Balances* *Balance of Enterprise Funds reflects actual cash balance, not total Fund balance Estimated Estimated General Fund $4,308,487 $3,808,488 $3,808,487 Special Revenue Funds Park Fund $761,536 $797,067 $468,067 Drug & Felony Forfeiture $295,639 $328,304 $334,304 Senior Housing TIF Fund $76,413 $74,856 $91,856 Affordable Housing Fund $132,379 $132,379 $132,379 Lurton Park Fund -$6,956 -$32,374 -$32,374 Employee Development $21,640 $21,640 $21,640 Golf Course Fund $266 $266 $266 Special Revenue Funds $1,280,918 $1,322,138 $1,016,138 Debt Service 2005 HRA Public Projects $44,419 $0 $ Street Reconstruction $87,666 $0 $ Improvement $0 $0 $ MSA/PMP/Refunding $684,333 $536,530 $400, GO/Water/Abatment $977,678 $707,444 $724, GO Imp Refunding $310,248 $425,295 $489,070 Debt Service $2,104,345 $1,669,269 $1,613,963 Capital Projects MSA Fund -$1,050,959 $0 $0 Improvement Eqpt Outlay $1,177,742 $839,714 $266,490 PIR Fund $1,284,028 $1,244,883 $1,229,579 Pavement Mgmt $377,417 $462,233 -$49,612 Community Investment $658,854 $544,258 $549,258 Police Capital Project Fund $24,883 $24,883 $0 Capital Projects $2,471,966 $3,115,971 $1,995,715 Enterprise Funds * Water Operating $899,121 $774,118 $215,890 Sewer Operating $2,778,844 $2,585,816 $1,839,932 Storm Water Operating $1,640,264 $1,763,437 $1,047,912 Recycling Operating $50,540 $66,850 $72,110 Cable Television $152,812 $179,381 $189,351 Enterprise Funds GRAND TOTAL $5,521,581 $5,369,602 $3,365,195 $15,687,296 $15,285,469 $11,799, Page 39

44 Changes in Fund Balance General Fund Estimated Estimated Revenues $ 8,467,198 $ 8,193,400 $ 8,577,280 7,987,860 8,193,400 8,577,280 Revenues Over (Under) ed Revenues 479, Expenditures $ 7,560,072 $ 7,828,400 $ 8,027,280 7,988,364 7,828,400 8,027,280 Expenditures Over (Under) ed Expenditures (428,292) 0 - Other Financing Sources (Uses) Transfers Out: To Equipment Outlay Fund (270,000) (255,000) (300,000) Transfers Out: To Pavement Management (531,642) - - Transfers Out: To MSA Transfers Out: To 2014 Debt Service (125,000) (125,000) (100,000) Transfers Out: To 2016 Debt Service - - (165,000) In: From Capital Lease Proceeds Sale of Land and Equipment 38,738 15,000 15,000 Excess (Deficiency) of Revenue Over Expenditures 19, Fund Balance - Beginning of Year 4,388,096 4,425,148 4,425,148 Fund Balance - End of Year $ 4,425,148 $ 4,425,148 $ 4,425,148 Fund Balance Components Nonspendable - Prepaids 9,809 20,000 20,000 Nonspendable - Inventory 2,410 5,000 5,000 Unassigned 4,412,929 4,400,148 4,400,148 Total Fund Balance $ 4,425,148 $ 4,425,149 $ 4,425, Page 40

45 Changes in Fund Balance Special Revenue Funds Park Fund Estimated Estimated Revenues $ 15,758 $ - $ Revenues Over (Under) ed Revenues 15, Expenditures $ 44,380 $ - $ Expenditures Over (Under) ed Expenditures 44, Transfers In (Out) From Community Investment Fund Excess (Deficiency) of Revenue Over Expenditures (28,622) - - Fund Balance - Beginning of Year 790, , ,057 Fund Balance - End of Year 762, , ,057 Fund Balance Components Restricted for Land Acquisition and Park Development 762, , ,057 Total Fund Balance 762, , , Page 41

46 Changes in Fund Balance Special Revenue Funds Drug and Felony Forfieture Fund Estimated Estimated Revenues $ 33,901 $ - $ Revenues Over (Under) ed Revenues 33, Expenditures $ 7,437 $ - $ Expenditures Over (Under) ed Expenditures 7, Transfers In (Out) Excess (Deficiency) of Revenue Over Expenditures 26, Fund Balance - Beginning of Year 269, , ,826 Fund Balance - End of Year 295, , ,826 Fund Balance Components Restricted for Crime Prevention 295, , ,826 Total Fund Balance 295, , , Page 42

47 Changes in Fund Balance Special Revenue Funds Senior Housing TIF Estimated Estimated Revenues $ 73,272 $ - $ Revenues Over (Under) ed Revenues 73, Expenditures $ 42,293 $ - $ Expenditures Over (Under) ed Expenditures 42, Transfers In (Out) Excess (Deficiency) of Revenue Over Expenditures 30, Fund Balance - Beginning of Year 45,458 76,437 76,437 Fund Balance - End of Year 76,437 76,437 76,437 Fund Balance Components Restricted for Senior Housing 76,437 76,437 76,437 Total Fund Balance 76,437 76,437 76, Page 43

48 Changes in Fund Balance Special Revenue Funds Affordable Housing Fund Estimated Estimated Revenues $ 1,243 $ - $ Revenues Over (Under) ed Revenues 1, Expenditures $ - $ - $ Expenditures Over (Under) ed Expenditures Transfers In (Out) Excess (Deficiency) of Revenue Over Expenditures 1, Fund Balance - Beginning of Year 131, , ,467 Fund Balance - End of Year 132, , ,467 Fund Balance Components Restricted for Affordable Housing 132, , ,467 Total Fund Balance 132, , , Page 44

49 Changes in Fund Balance Special Revenue Funds Lurton Park Fund Estimated Estimated Revenues $ 319 $ - $ Revenues Over (Under) ed Revenues Expenditures $ 50,951 $ 28,414 $ Expenditures Over (Under) ed Expenditures 50,951 28,414 - Transfers In (Out) Transfer Out - Big Island Fund Excess (Deficiency) of Revenue Over Expenditures (50,632) (28,414) - Fund Balance - Beginning of Year 43,702 (6,930) (35,344) Fund Balance - End of Year (6,930) (35,344) (35,344) Fund Balance Components Restricted for Park Dev/Maintanence (6,930) (35,344) (35,344) Total Fund Balance (6,930) (35,344) (35,344) Page 45

50 Changes in Fund Balance Special Revenue Funds Employee Development Estimated Estimated Revenues $ 203 $ - $ Revenues Over (Under) ed Revenues Expenditures $ - $ - $ Expenditures Over (Under) ed Expenditures Transfers In (Out) Transfer In: General Fund Excess (Deficiency) of Revenue Over Expenditures Fund Balance - Beginning of Year 21,451 21,654 21,654 Fund Balance - End of Year 21,654 21,654 21,654 Fund Balance Components Assigned for Employee Development 21,654 21,654 21,654 Total Fund Balance 21,654 21,654 21, Page 46

51 Changes in Fund Balance Special Revenue Funds Golf Course Fund Estimated Estimated Revenues $ 9 $ - $ Revenues Over (Under) ed Revenues Expenditures $ 2,131 $ - $ Expenditures Over (Under) ed Expenditures 2, Transfers In (Out) Transfer In: General Fund Excess (Deficiency) of Revenue Over Expenditures (2,122) - - Fund Balance - Beginning of Year 2, Fund Balance - End of Year Fund Balance Components Assigned for Golf Course Improvements Total Fund Balance Page 47