Executive Budget Summary

Transcription

1 2016 Executive Budget Summary Department of Finance City of Madison October 6, 2015

2 Assessed Values [see p. 8 of 2016 Executive Operating Budget] Property values have grown 3.79% on the strength of a 3.94% increase in residential and 5.75% increase in commercial property values (commercial property includes apartments). From 1991 to 2016, values have grown an average of 5.4% annually. From 2012 to 2016, values have grown an average of 0.8% annually. This year, assessed values have exceeded the prior peak level set in Assessed value of property in tax increment districts (TIDs) increased nearly 30%. This is due both to value growth in existing TIDs and creation of new TIDs. The average home value is up 3.5%, reflecting stronger housing sales. Changes in Assessed Values from 2014 Residential: up 3.94% Commercial: up 5.75% Agricultural: down 8.81% Manufacturing: up 2.27% Personal Property: up 1.23% TIF Increment Value (deduction): up 29.95% Net Taxable Property: up 3.79% Average Value Home: up 3.46% 2

3 General Fund Spending and Levy Increase [see p. 8 of 2016 Budget] Levy = Expenditures less Revenues (i.e., State aid) Expenditures up 2.1% (+$5.8 million) [see pp. 7-9] General fund expenditures up 1.9% due primarily to compensation, debt service and operating costs. Library fund expenditures up 4.0% due primarily to compensation and operating costs. Total debt service (general fund and library fund) is up $2.9 million (7.2%). Revenues up 0.9% (+$683,500) [see pp ] State aid (excluding transit aid) down 1.2%. With transit aid, state aid is decreasing 0.8%. Ambulance fee revenues up 8.4% compared to the 2015 adopted budget, due to expansion of fire and emergency medical services to surrounding communities, improved collections, and an increase in the resident fee to the same level as the non-resident fee ($1,000). This change increases revenues by $275,000 and will improve processing of the fee, which is primarily paid by insurance companies. Room tax revenues to general fund up 9.8% compared with adopted 2015 budget due to continued strong growth in overall revenues. In addition, the entire Overture Center subsidy will be paid from the Room Tax Fund, with a net benefit of $1.3 million to the General Fund. The Overture Center subsidy will remain unchanged at $1.75 million. Building permits are down 9.2% from 2015 adopted budget estimates due to a slower rate of growth in construction compared with earlier in the decade. Revenues from fines and forfeitures are down 5%, led by 13% to 15% decreases in moving violations and uniform citations compared with 2015 adopted budget estimates. Parking violation estimates include a $150,000 increase in revenues associated with raising the towing fee from $50 to $65, the first increase since Change from 2015 $ % Expenditures $5.8 million 2.1% Revenues $0.7 million 0.9% Fund Balance Applied $-1.4 million % Levy $6.5 million 3.2% 3

4 Mill Rate and Taxes on Average Value Home [see p. 8 of 2016 Budget] 1. Mill Rate Mill Rate = Levy divided by Assessed Value Estimated mill rate under executive budget = $9.45 per $1,000 of value. Mill rate is down 0.5% from 2015 due to levy increase of 3.2% and an increase in assessed value of 3.8%. 2. Taxes on Average Value Home Average Value Home = Residential value divided by number of residential parcels Taxes on Average Value Home = Mill Rate multiplied by Average Value Home 2015 average value home = $245,894 (up $8,216 / 3.5%). Taxes on average value home = $2,323 (up $66 / 2.9%). 4

5 Levy Limit Calculation Allowable Increase = the greater of 0% or the Change in Net New Construction Key Adjustments / Exclusions Fee increases for garbage collection, fire protection, snow plowing, street sweeping, or stormwater management result in a commensurate reduction in levy limit if those services provided from property taxes in % of incremental value from closed TIDs. Up to 1.5% of prior year unused allowable levy limit (0.5% or less requires majority vote of governing body; 0.5% to 1.5% requires three-fourths majority vote). Change in debt service on general obligation debt. Amount of refunded or rescinded taxes. Calculation of Allowable Levy for City 5

6 Trends in Taxes and Spending [see Madison Measures] Historical Levy Increases Historical General Fund Expenditure Increases 7.00% 6.00% 5.00% 4.00% City of Madison Percent Budgeted Expenditure Increases Above/Below the Historical 15-Year Average of 3.62% 3.00% % 1.00% 0.00% 6

7 Historical Increases in Taxes on the Average Home City of Madison Percent TOAH Increases Above/Below the Historical 15-Year Average of 3.42% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% -1.00% % 7

8 Budget Summaries 8

9 Balancing the Budget 9

10 Balancing the Budget (continued) 10

11 General Fund Balance Maintaining an unassigned fund balance of 15% of subsequent year General Fund expenditures is a key financial policy goal and a major element of the City s Aaa bond rating. The graph below shows the history of the fund balance since 1995 and the expected level in 2016 and The 2016 executive operating budget is the first year since 2011 that no premium stabilization funding has been applied. The premium stabilization fund is the result of excess balances that had built up over many years in the City s life and disability insurance programs that are managed by the City s third-party insurance administrator. An excess balance of $7.5 million was returned to the City in Beginning with the 2012 budget, this balance has been spent down at a rate of $2 million annually. The 2015 budget included $1.366 million; this amount needed to be addressed through other sources in the 2016 executive operating budget. 11

12 Supplemental Budget Requests 12

13 Supplemental Budget Requests (continued) 13

14 Supplemental Budget Requests (continued) 14

15 Tax Rate Computation 15

16 Comparative Changes in Levy, Mill Rate and Taxes on Average Value Home 16

17 Summary of General and Library Funds Expenditures, Revenues and Property Tax Levy 17

18 Summary of General Fund Revenues 18

19 Budget and Allocation Adjustments Change Notes Building Inspection 1.00 Additional Inspector Civil Rights Equity Coordinator to Mayor's Office Engineering Movement of positions to Sewer, Stormwater and Landfill Sewer Movement from Engineering Stormwater Movement from Engineering Fire Person Recruit Class, 3 currently doublefilled positions IT Allocation Adjustment Landfill 3.00 Movement from Engineering Library 0.05 Allocation Adjustment Mayor 1.00 Equity Coordinator Metro 1.60 Position reclassifications, 2015 changes Monona Terrace Custodial Worker Parking Utility Reduce 1 Parking Cashier Police Recruits, 4 COPs Positions, 1 Accountant; 20 Crossing Guards to hourly budget Treasurer 1.00 Creation of shared position between Treasurer & Assessor Gross Position Change Crossing Guards Positions funded as hourlies Police and Fire Recruits Permanent positions created Adjusted Change New Positions Engineering 1.00 Engineering Development Manager Finance 1.00 Risk Management Assistant Finance 1.00 Financial Training Coordinator Information Technology 1.00 IT Security Speciailist Information Technology 2.00 IT Asset Management Staff Library 1.00 Library Bilingual Coordinator Library 1.00 Bubbler Program Assistant Library 0.40 Library Accountant to Full Time Library 0.10 Library Web Manager to Full Time PCED 1.00 PCED Financial Operations Manager Planning 1.00 Neighborhood Planner Sewer 4.00 Sewer Hourlies to Permanent CDA Housing 2.00 CDA Housing Operations Total Change