2016 Levy & Budget Adoption Meeting VICTORIA CITY COUNCIL DECEMBER 14, 2015

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1 2016 Levy & Budget Adoption Meeting VICTORIA CITY COUNCIL DECEMBER 14, 2015

2 Overview Review Proposed 2016 Levy, Budgets, and CIP Public Input Council Discussion Adopt 2016 Levy, Budgets, and CIP

3 2016 Final Levy Proposed Final Levy for $4,367,000 Unchanged from Preliminary Final Levy adopted in September $266,200 or 6.5% from 2015 Levy of $4,100,800 Three components to Levy General Fund - $3,181,000 Rec Center Fund - $150,000 Debt Service - $1,036,000 (includes EDA HRA Levy)

4 Levy History 2016 Levy is slightly higher than the 2009 Levy of $4,362,480 $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $ Gen Fund VRC Debt

5 Impact on Property Taxes Tax rate from 33.3% in 2015 to 32.9% in 2016 Market Change in Existing Homes 4.6% from 2015 to 2016 Median valued home 5.8% from $350,100 to $370,500 Taxes on median valued home from $1,148 to $1,207 City portion only about 25% of total property taxes County, school, and other taxing entities remaining 75%

6 Median Valued Home & Tax History Median valued home roughly equal to 2009 high point 2016 City taxes of $1,207 lower than 2009 high point of $1,381 Median Valued Home $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 City Tax $ MV Home Taxes $-

7 Impact on Other Home Values Assume 4.6% increase in value from Home Value 2016 Home Value 2015 City Taxes 2016 City Taxes Change in City Taxes $227,420 $237,836 $702 $731 $29 $470,532 $492,083 $1,568 $1,620 $52 $682,260 $713,508 $2,730 $2,883 $153 $909,680 $951,343 $4,056 $4,261 $205

8 General Fund Budget Revenues $4,219,597 Expenditures $3,673,247 Transfers $527,454 Contribution to Fund Balance $18, Ending Fund Balance $1,129,068 = to 30% of 2017 expenditures Meets 30% policy

9 General Fund Revenues Proposed 2016 Revenues - $4,219,597 Revenues $330,785 over 2015 Largely due to $325,000 levy increase Revenues by Type Taxes & Franchise Fees $3,268,253 77% Licenses & Permits $373,528 9% Intergovt Rev $115,801 3% Other $45,395 1% Charges for Services $416,620 10%

10 General Fund Expenditures Proposed 2016 Expenditures - $3,673,247 Expenditures $270,648 over 2015 Primary Factors for Financial Mgmt Software $55,000 Comp Plan Update $37,500 AUAR South of Marsh Lake Rd $45,000 Fire Dept FT Chief 8/1/16 $45,000 Other Fire Dept Wages - No. of firefighters $38,400 Total $220,900

11 General Fund Expenditures Total in all other Expenditures - $49,748 Wages & Benefits 3.4% - $50,246 (except Fire Dept) 2% Wages employees above mid-point of salary range Up to 3% Wages employees below mid-point of salary range Health Insurance 6.5%

12 General Fund Expenditures by Function Public Safety $898,330 24% Public Works $962,430 26% Gen Govt $1,386,967 38% Parks & Rec $425,520 12%

13 General Fund Expenditures by Object Supplies, Repairs, Maint $597,769 16% Contractual Services $1,069,850 29% Utilities $171,039 5% Wages & Benefits $1,617,417 44% Misc $153,172 4% Capital Outlay $64,000 2%

14 General Fund Budgeted Transfers Fund Transferred to 2015 Budget 2016 Budget Change in Budget Fire Capital Equip $64,135 $64,135 $0 PW Capital $110,000 $120,000 $10,000 Water Fund Loan $150,000 $58,319 $-91,681 Long-Term Street Maint $157,000 $275,000 $118,000 Concerts in the Park $0 $10,000 $10,000 Total $481,135 $527,454 $46,319

15 Potential Budget Cuts Council asked for list of potential budget cuts Comp Plan Update (delay) $37,500 AUAR South of Marsh Lake Rd $45,000 Fire Dept FT Chief 8/1/16 $45,000 Other Fire Dept Wages - No. of firefighters $38,400 Reduce transfer to Long-Term Street Main Fund $100,000 Each $50,000 in expenditures: Tax rate 39 basis points (32.92% to 32.53%) Taxes on median valued home $14

16 Recreation Center Budget Revenues $1,082,774 Expenditures $638,627 Transfer for Debt Service $440,000 Contribution to Fund Balance $4, Ending Fund Balance $912,496 Portion set aside for facilities maintenance

17 Recreation Center Revenues Proposed 2016 Revenues - $1,082,774 Revenues $30,559 over 2015 Largely due to $18,900 in ISD Reimbursement Revenues by Type ISD Lease 42% ISD Reimbursement 28% Charges for Services 15% Property Taxes 14% Other 1%

18 Recreation Center Expenditures & Transfers Proposed 2016 Expenditures - $638,627 Expenditures $52,769 over 2015 Largely due to $23,000 for financial mgmt software Proposed 2016 Transfer for Debt Service - $440,000

19 Recreation Center Expenditures & Transfers Other $69,646 6% Wages & Benefits $183,774 17% Supplies, Repairs & Maint $87,425 8% Transfer for Debt Service $440,000 41% Contractual Services $65,398 6% Utilities $232,384 22%

20 Water Fund Budget Operating Revenues $1,270,467 Non-Operating Revenues $572,879 Expenses $2,227,469 Difference between Revenue & Expenses $-384, Ending Available Cash $422,818

21 Water Fund Revenues Operating Revenues - $1,270,467 $31,032 from 2015 due to new home growth Non-Operating Revenues - $572,879 $122,538 from 2015 Lower loan repayment loan will still be repaid by 2019 Less interest income No change in water rates for 2016

22 Water Fund Expenses Cash Expenses - $2,227,469 $2,217,504 from 2015 Water Storage Reservoir in 2015 Capital Outlay Well #5 - Total cost is $1,500,000 Location/Design 2016 $500,000 Construction 2017 $1,000,000 Reimburse Developers for water main oversizing - $202,132 Financial Mgmt Software - $18,000

23 Sewer Fund Budget Operating Revenues $863,203 Non-Operating Revenues $159,438 Expenses $1,415,790 Difference between Revenue & Expenses $-393, Ending Available Cash $42,608

24 Sewer Fund Revenues Operating Revenues - $863,203 $41,607 from % rate increase New home growth Non-Operating Revenues - $159,438 $1,500 from 2015 Less interest income

25 Sewer Fund Expenses Cash Expenses - $1,415,790 $102,016 from 2015 $83,091 in Met Council wastewater fees Have appealed basis for charge Will know by summer if successful refund likely, but not guaranteed Capital Outlay Reimburse Developers for sewer main oversizing - $161,052 Televising Equipment $50,000 may share or rent Grinder for Lift Station deactivation - $35,000 Portable Generator - $30,000 Financial Mgmt Software - $18,000

26 Storm Water Fund Budget Operating Revenues $152,512 Non-Operating Revenues $4,151 Expenses $251,271 Difference between Revenue & Expenses $-94, Ending Available Cash $320,506

27 Storm Water Fund Revenues Operating Revenues - $152,512 $676 from 2015 New home growth Non-Operating Revenues - $4,151 $121 from 2015 Interest income

28 Storm Water Fund Expenses Cash Expenses - $251,271 $43,835 from 2015 Allocation of Wages/Benefits in PW hours for maintenance Utility Billing brought back in-house Televising Equipment $50,000 may share or rent Financial Mgmt Software - $12,000 Gas-powered Auger - $5,000

29 Capital Improvement Plan Capital Improvements CIP Adoption does not mean automatic approval Projects costing $10,000 or more go to Council Projects for 2016 included in line item budgets Projects for adopted conceptually Adequate Funding for all but one project, fire station buildout

30 Capital Improvement Plan for PW Capital Equipment Fund Total

31 Capital Improvement Plan for Fire Dept Capital Equipment Fund Total

32 Capital Improvement Plan for Park Funds Total

33 Capital Improvement Plan for Streets

34 Long-Term Financial Plan Incorporates information from a variety of sources to develop a plan for 2016 to 2025: Council Plans and Goals Maintain or Lower Tax Rate Maintain or Improve Service Levels City Policies 30% GF Unassigned Balance Tax-supported debt < 1.5% of Market Value Debt service portion of levy < 30% of total levy Budget & Levy Details of current budget/levy included Levies for GF, RC, and Debt Service projected Forecasts for: Number of New Homes 90/year Market Value Growth of Existing Properties 2.5% yr Additional Staff/Equipment Needed Inflation 3.0%/year Capital Improvement Plan CIP items from GF & RC Budgets Street & Utility Reconstruction Debt Issuance Current debt service payments Future debt service payments 34

35 Long-Term Projections City Tax Rate 45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Tax Rate Tax on MV Home $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $- Taxes on MV Home

36 Next Steps Hold Public Hearing on Proposed Budgets & Levy Council Discussion Adopt Levy, Budgets, & CIP