More on the Levy
I wanted to return to the details of the final levy decision from Monday night's long meeting.
Using the staff-recommended 3.0% increase as a starting point, the council discussed further cuts and cost savings to achieve a lower levy. The motion passed 3-2, but as its details were discussed, it did seem to me that input of the entire council influenced the motion, even if it did not win everyone's approval in the end.
These additional cuts were passed:
If we take these changes and use them to adjust the figures on page 28 of the draft budget, we get the following:
Under the state's levy limits, we could have increased our operating levy by 3.9% (plus an allowance for new construction). Instead, we reduced it.
What we can't reduce are the city's debt service obligations -- we have to make payments on those bonds for past street projects and the like. Even including those bond payments, the final levy increase of 2.12% is well below the rate of inflation, whether you measure that by the Consumer Price Index or the Implicit Price Deflator for State and Local Government Consumption.
Using the staff-recommended 3.0% increase as a starting point, the council discussed further cuts and cost savings to achieve a lower levy. The motion passed 3-2, but as its details were discussed, it did seem to me that input of the entire council influenced the motion, even if it did not win everyone's approval in the end.
These additional cuts were passed:
- $18,000 from Public Works. The expected result of this cut will be somewhat slower plowing of city-owned sidewalks and trails, as there will be less money available for overtime.
- $5,000 from Information Technology. This amounts to putting off for a year the replacement of five computers owned by the city.
- $9,500 from Citizen Services. This will reduce some service at city hall -- possibly at the information desk, possibly at the service window where people get passports, licenses, etc.
- $7,400 from the Fire Department. We will spend less on uniforms and will replace 10 sets of turn out gear rather than 12.
- $43,000 from Police. We will not buy a hybrid SUV ($26,000 savings). We also can account for $17,000 in savings from a recent change of provider for youth diversion services (the budget was written before we had finalized that deal and locked in the savings).
- $50,000 from the fuel budget city-wide. Mr. Ahl indicated that he would get to work on a contract to lock in fuel prices for the first six months of the year. The budget had assumed more expensive gasoline and diesel prices -- again, this was a prudent expectation earlier this year when oil was through the roof.
- $5,000 from the travel and training budget for the City Manager, Council and Mayor. This cuts in half the funding we have to attend things like the League of Minnesota Cities annual meeting or regional meetings, or the National League of Cities conferences that the mayor has attended in the past two years. It seemed fair, as we were cutting other departments, to give up something of the council's as well.
If we take these changes and use them to adjust the figures on page 28 of the draft budget, we get the following:
| 2008 Levy | 2009 Levy | $Change | %Change | |
| Operations: | ||||
| General Fund | $11,644,525 | $11,546,895 | ($97,630) | -0.84% |
| Community Center Operations Fund | 230,000 | 300,000 | 70,000 | 30.4% |
| Recreation Programs Fund | 250,000 | 250,000 | 0 | 0.0% |
| Debt Service: | ||||
| Debt Service Fund | 3,421,925 | 3,779,340 | 357,415 | 10.2% |
| Totals - All Funds | $15,546,450 | $15,876,235 | $329,785 | 2.12% |
Under the state's levy limits, we could have increased our operating levy by 3.9% (plus an allowance for new construction). Instead, we reduced it.
What we can't reduce are the city's debt service obligations -- we have to make payments on those bonds for past street projects and the like. Even including those bond payments, the final levy increase of 2.12% is well below the rate of inflation, whether you measure that by the Consumer Price Index or the Implicit Price Deflator for State and Local Government Consumption.
Labels: finance
Post a Comment