12-05-16 CC Spec TNT Mtg
CITY OF SHOREWOOD 5755 COUNTRY CLUB ROAD
CITY COUNCIL SPECIAL MEETING COUNCIL CHAMBERS
MONDAY, DECEMBER 5, 2016 7:00 P.M.
AGENDA
Attachments
1. CONVENE CITY COUNCIL SPECIAL MEETING
A. Roll Call
Mayor Zerby ____
Labadie____
Siakel ____
Sundberg____
Woodruff ____
B. Review Agenda
2. TRUTH-IN-TAXATION PUBLIC HEARING Finance Director’s
memo
A. Staff Presentation
B. Public Hearing
C. Council Deliberation/Decision to Reconvene
3. APPROVING THE 2017 GENERAL FUND BUDGET AND PROPERTY Finance Director’s
TAX LEVY COLLECTIBLE IN 2017 memo, Resolution
4. ADJOURN
#2
MEETING TYPE
City of Shorewood Council Meeting Item
Special Meeting
Title / Subject: 2016 Truth-in-Taxation Presentation
Meeting Date: December 5, 2016
Prepared by: Bruce DeJong, Finance Director
Reviewed by: Greg Lerud, City Administrator
Attachments: Truth-in-Taxation PowerPoint Presentation
Policy Consideration: The City Council is required by law to consider public input at this hearing prior
to adopting the property tax levy and budget for 2017.
Background: The property tax system is detailed, complex, and confusing. The process used to
determine each property’s value and taxes starts several years prior to the action that we will take this
evening. A general timeline is as follows:
October, 2014-September, 2015 – Real Estate sales occur for about 3% of properties in town.
October-December, 2015 – Hennepin County assessing staff analyze the sales and extrapolate
that data to determine an estimated Market Value for each property in town base on similar
styles, sizes, finish levels, amenities, and neighborhoods.
January 2, 2016 – A property value is set for each parcel in the community.
March, 2016 – Valuation notices are sent to each parcel with the new estimated property value.
April-June, 2016 – Open Book meeting at City Hall and valuation appeals to the Hennepin
County Board of Equalization. This will finalize the value to be used for Truth-in-Taxation
estimates and 2017 property taxes.
July-September, 2016 – City Council discusses the General Fund budget and property tax levy for
2017.
September 30, 2016 – The preliminary tax levy is certified to Hennepin County.
November, 2016 – A Truth-in-Taxation parcel-specific notice is mailed to each property owner
with the estimated taxes identified for each taxing jurisdiction - County, City, School District,
Metropolitan Council, Watershed District, and other minor taxing districts.
December 5, 2016 – Shorewood City Council holds the Truth-in-Taxation meeting and adopts a
tax levy and budget for 2017.
December 28, 2016 – Final tax levy is certified to Hennepin County and Form TNT is filed with
the Minnesota Department of Revenue.
May 15, 2017 – 2017 first half taxes are due at Hennepin County.
The City Council adopted a preliminary budget and 2% tax levy increase in August. That information
was sent to Hennepin County who used the County Assessor’s property values to determine an
estimated tax rate for each overlapping jurisdiction. This information was combined with preliminary
Mission Statement: The City of Shorewood is committed to providing residents quality public services, a
healthy environment, a variety of attractive amenities, a sustainable tax base, and sound financial
management through effective, efficient, and visionary leadership. Page 1
tax information from other taxing jurisdictions to create a Truth-in-Taxation statement for each
property.
For this meeting, the City Council holds a public hearing to allow taxpayers to discuss the budget in
general, department budgets, and the amount of property taxes levied by the City of Shorewood.
This meeting is not structured for property owners to discuss individual property values, which were
set earlier in the year at the Open Book and Board of Review process held from April through June.
This meeting is also not the forum to discuss the property tax on individual properties. The property
tax is based on changes to the property value. Anything other than a 2% increase is based on changes
to the relative share of an individual property value in comparison with all other properties in the city.
The required elements for the Truth-in-Taxation process are:
1.The proposed property tax levy must be certified to the county auditor by September 30.
2.The public meeting is held at the scheduled time and place indicated on the TNT notice.
3.The proposed budget and property tax levy are discussed at the meeting.
4.The public is invited and allowed to speak and to ask questions concerning the budget and
proposed property taxes at the public meeting.
5.The final property tax levy and the final budget are adopted.
6.The final property tax levy may not exceed the preliminary certified property tax levy.
7.The final property tax levy must be certified to the county auditor by no later than December 28.
8.Form TNT must be submitted to the Dept. of Revenue after the final tax levy is adopted but no
later than December 28.
Items in bold will be discussed at the Public Hearing on December 5.
Financial or Budget Considerations:
The tax levy and budget presented at this meeting are the same as the levy originally certified to
Hennepin County. This raises the 2017 tax levy 2.0% higher than the 2016 tax levy.
Options: If time does not allow all interested parties to provide input or the City Council would like
more time to discuss the budget and/or tax levy, the vote can be postponed until December 12.
Recommendation / Action Requested: Staff recommends that the City Council hold the public hearing
and accept public input on the proposed budget and tax levy.
Next Steps and Timelines: The final General Fund budget and tax levy will be on the agenda for
approval after the public hearing at this meeting.
Connection to Vision / Mission: This item contributes to sound financial management by providing
effective city services at a reasonable price.
City of Shorewood
December 512016 City Council TNT Meeting
1 . CONVENE CITY COUNCIL TRUTH- IN -TAXATION
MEETING
A. Roll Call
B. Review Agenda
2 . 2017 General Fund Budget and Levy Presentation
C *Ity of Shorewood
2017 Budget
TruthminmTaxation
December 5, 2016
'aka •�iwy„t i
_ s' �' CIT'10F 9HOREw��
•.".. • • 4Y.. 5155 COUNTRY CLUB RD.
Truth - in -taxation requirements
• Present the 2017 General Fund budget
• Discuss the budget and property tax levy
• Invite public comment
• Adopt a balanced budget
■
City Services in General Fund
• Police & Fire Protection
• Street & Park Maintenance
• Recreation Programs
• Building Inspections
• Transfers to Southshore
Center & Capital Funds
• Administration, Finance., Planning & Zoning,
Elections., and other services
■
Budget Assumptions
• Levy increase — 2% increase over 2016 for general fund
operations — primarily personnel costs
• New staffing for full-time Administrator position
• Other staffing levels remain the same from 2016
•
2 . 5 % salary & benefit increase budgeted
• Street & Equipment transfers rise $30,000
• $ 192,785 of reserves used to balance the budget
— up $ 12, 637 from use of reserves budgeted for
2016 .
891
Budgeted Expenditures
& Transfers
2008-2017
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000 Expenditures
$2,000,000
$1,000,000
2008 2010 2012 2014 2016
2017 Expenditures
Culture &
General
Recreation
Government
Public 5 0° 27%
Works
32%
•General Government
•Public Safety
Public Works
•Culture& Recreation
Public Safety
36%
Total Expenditures of $6 , 041 , 312 al
Revenues 2008-2017
$6,000,000
�y
$5,000,000
Misc
$4,000,000 Fines
$3,000,000 Chg for Svc
me rgovt
$2,000,000 Permits
$1,000,000 ■ Tax Levy
$0
2008 2010 2012 2014 2016
no
2017 R
Fines & Charges for Transfers & Reserves
1% Service Misc
Forfeits o
1% 0.7% 4% 3.1%
Intergovern-
mental
1 .6% \
Licenses/
Permits
2.9%
Taxes
86.7%
Total Revenues of $5 , 848 , 527
■
Tax Assessment & Levy Timeline
Oct ,2014-
Sept, 2015 Jan 2, 2016 Apr-Jun, 2016 Sept, 2016 Nov, 2016 2017
Property Market Board of Prelim Cert', TNT Taxes
Sales Value Review ,'ito Henn Co i'i Notice Levied
I�L ik I�L 'Ik lk I
Property taxes are set based on sales that occurred over a year ago.
Current values may be different than taxable values. am
2017 Property Tax Distri ution
Other
City 6.6%
— -------
21.4 _ _ --------
School
District
38.5%
Hennepin
County
33.4%
Based on Minnetonka School District home valued at
$350,000 — the percentage changes as home values vary am
Total Tax $ Change - 2017
Tax Change # of Parcels % of Parcels
Decrease 11387 57.0%
$0-300 514 21. 1%
$301-600 332 13.6%
$601-900 130 5.3%
$901+ 71 3.0%
Full property tax bill — includes county, school
district and other taxing jurisdictions no
Impact of City Portion
of 2PI7 Taxes
2016 2017
2016 Value 2017 Value Tax Tax $ Change* % Change
$250,000 $258,750 $711 $721 $10 1.4%
$375,000 $388, 125 $1, 123 $1, 136 $13 1.2%
$500,000 $517,500 $1,511 $1,537 $26 1.7%
$750,000 $776,250 $2,456 $2,489 $33 1.4%
$1,000,000 $1,035,000 $3,400 $3,441 $41 1.2%
Residential properties experienced an average increase in
value of 3.5%. If your property changed more or less, then
you will see different results. Values shown are based on
sales from almost 2 years earlier.
* Changes estimated based on 2% levy increase. am
Tax Relief Programs for Homeowners
• Homestead Credit Refund
— Available if taxes exceed 2% of income for
households with income up to $65,409 and 2 .5%
for those over $65,409 and below $105,500.
• Special Property Tax Refund
— Available if taxes increase more than 12% and the
increase is over $100.
• Renter's Refund
— Household income must be $57, 169 or less. no
Taxpayer input ited s invi
at this time .
City of Shorewood
December 512016 City Council TNT Meeting
3 . APPROVING THE 2017 GENERAL FUND BUDGET
AND PROPERTY TAX LEVY COLLECTIBLE IN 2017
City of Shorewood
December 512016 City Council TNT Meeting
4. ADJOURN
#3
MEETING TYPE
Special Meeting
City of Shorewood Council Meeting Item
..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
Title/Subject: Adoption of the 2017 General Fund Budget and Property Tax Levy Collectible in 2016
Meeting Date: December 5, 2016
Prepared by: Bruce DeJong, Finance Director
CC: Greg Lerud, City Administrator
Attachment: Resolution
2017 General Fund Summary Budget
Policy Consideration:
Adoption of this resolution will allow staff to certify the budget and property tax levy to Hennepin
County as required by state law.
Background:
By statute, the City Council must annually approve a budget and property tax levy within five business
days of December 20. The 2017 General Fund Budget has been presented based on the preliminary
budget adopted in August, and modified by adding$35,000 for forestry management and $85,000 for
Comprehensive Plan updates as recommended by City Council at the November 28 work session. The
budget discussed at the Truth-in-Taxation public hearing should be adopted with any modifications
desired by the City Council.
The 2017 budget contains the highest budgeted use of reserves from the past five years at$192,785.
The 2017 budget contains one-time expenditures of$85,000, so the ongoing use of fund balance would
be about$107,785 which is well below the 2016 budgeted use of reserves of$180,148.
The city has been in a position to have reserves above policy targets. That has allowed the city to do
one-time projects for the benefit of the city by using those reserve amounts above the 60% reserve
target. It is important for the council to remember that as the available fund balance gets close to the
policy target of 60%of estimated revenues,those reserves will no longer be available to be used to do
one-time projects or balance the budget, which raises the specter of increasing the levy higher than
inflation might suggest. Staff will continue to conservatively budget and be cautious about using
reserves.
Financial or Budget Considerations:
The adoption of this resolution records the City Council's spending priorities for 2017 and the amount of
property taxes to be raised.
Options:
The City Council may choose to:
1. Adopt the budget and levy as presented at the 2.0%tax levy increase level.
2. Make additional changes to the budget and/or tax levy and adopt the amended budget and levy.
Mission Statement: The City of Shorewood is committed to providing residents quality public services, a
healthy environment, a variety of attractive amenities, a sustainable tax base, and sound financial
management through effective, efficient, and visionary leadership. Page 1
Recommendation/Action Requested:
Staff recommends that the City Council adopt the resolution as submitted.
Next Steps and Timelines:
The final tax levy will be applied by Hennepin County to create property tax statements that will be
mailed in April, 2017,for collection on May 15 and October 15, 2017.
Connection to Vision/Mission:
This process contributes to sound financial management by providing financial resources to pay for
desired city services.
CITY OF SHOREWOOD
RESOLUTION NO. 16-
A RESOLUTION ADOPTING THE 2017 GENERAL FUND OPERATING BUDGET
AND APPROVING THE PROPERTY TAX LEVY COLLECTIBLE IN 2017
WHEREAS, the 2017 Budget and property tax levies collectible in 2017 for the
City of Shorewood have been prepared and reviewed by the City Council; and,
WHEREAS, the budget has been modified by the City Council to meet service delivery
goals; and,
WHEREAS, the City Council held a Truth-in-Taxation public hearing on December 5,
2016, to receive public comment regarding the adoption of such budgets and property tax levies;
NOW, THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SHOREWOOD AS FOLLOWS:
1. That a budget of$6,041,312 is adopted to pay for 2017 General Fund operations.
2. That the sum of$5,180,996 is levied for 2016, collectible in 2017, upon taxable
property in the City of Shorewood.
3. That the City Administrator 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 CITY OF SHOREWOOD this 5th day of
December, 2016.
ATTEST: Scott Zerby, Mayor
Jean Panchyshyn, City Clerk
• i i ►/ ll ' Iwo
Total General Government
less transfers
Net General Government
POLICE
Materials and Supplies
Support Services and Charges
Capital
Total Police
1,442,087 1,667,546 1,374,359 1,596,387 1,668,737 4.5% 72,350
(192,150) (473,120) (171,513) (174,313) (172,913)
1,249,937 1,194,426 1,202,846 1,422,074 1,495,824
1,018,680 1,051,134 1,082,129 1,106,165 1,180,050 6.7% 73,885
227,764 229,764 225,180 230,000 214,000 -7.0% (16,000)
1,246,444 1,280,898 1,307,309 1,336,165 1,394,050 4.3% 57,885
Requested
Actual
Actual
Actual
Budget
Budget
Percent
Dollar
2013
2014
2015
2016
2017
Change
Change
REVENUES
TAXES
4,764,472
4,864,671
4,949,125
5,079,408
5,180,996
2.0%
101,588
LICENSES & PERMITS
204,575
271,510
275,567
169,180
239,180
41.4%
70,000
INTERGOVERNMENTAL
96,549
122,606
103,795
90,751
90,751
0.0%
-
CHARGES FOR SERVICES
33,194
-
58,786
42,200
42,200
0.0%
FINES & FORFEITURES
59,294
-
65,084
60,000
60,000
0.0%
MISCELLANEOUS REVENUE
205,010
253,773
263,137
210,400
210,400
0.0%
TRANSFERS
317,182
25,000
25,000
25,000
25,000
0.0%
-
TOTAL REVENUES
5,680,276
5,537,560
5,740,494
5,676,939
5,848,527
3.0%
171,588
EXPENDITURES
CITY COUNCIL
Personnel
16,794
16,794
22,176
22,600
22,600
0.0%
-
Materials and Supplies
2,035
1,014
1,751
2,000
2,000
0.0%
Support Services and Charges
90,885
51,414
55,459
133,500
116,500
-12.7%
(17,000)
Transfers
91,700
369,170
70,000
70,000
70,000
0.0%
Total City Council
201,414
438,392
149,386
228,100
211,100
-7.5%
(17,000)
Administration
Personnel
240,032
249,927
247,462
414,154
402,154
-2.9%
(12,000)
Materials and Supplies
15,649
17,852
13,288
20,900
20,900
0.0%
Support Services and Charges
134,401
140,953
143,038
42,550
42,550
0.0%
Total City Administration
390,082
408,732
403,788
477,604
455,604
-2.5%
(12,000)
FINANCE
Personnel
137,469
138,464
142,782
142,273
142,273
0.0%
-
Materials and Supplies
8,547
15,415
19,253
14,600
15,600
6.8%
1,000
Support Services and Charges
14,619
14,191
-
15,900
17,300
8.8%
1,400
Total Finance
160,635
168,070
162,035
172,773
175,173
1.4%
2,400
PROFESSIONAL SERVICES
Support Services and Charges
199,042
207,153
200,096
226,400
236,400
4.4%
10,000
Total Professional Services
199,042
207,153
200,096
226,400
236,400
4.4%
10,000
PLANNING
Personnel
181,143
182,641
183,568
178,797
178,797
0.0%
-
Materials and Supplies
292
303
423
300
450
50.0%
150
Support Services and Charges
7,684
14,459
18,589
12,000
97,000
708.3%
85,000
Total Planning
189,119
197,403
202,580
191,097
276,247
44.6%
85,150
MUNICIPAL BUILDINGS
Materials and Supplies
60,118
56,990
54,591
21,300
21,300
0.0%
-
Support Services and Charges
141,227
86,857
100,370
174,800
180,000
3.0%
5,200
Capital
-
-
-
-
-
-
Transfers
100,450
103,950
101,513
104,313
102,913
-1.3%
(1,400)
Total Municipal Buildings
301,795
247,797
256,474
300,413
304,213
1.3%
3,800
Total General Government
less transfers
Net General Government
POLICE
Materials and Supplies
Support Services and Charges
Capital
Total Police
1,442,087 1,667,546 1,374,359 1,596,387 1,668,737 4.5% 72,350
(192,150) (473,120) (171,513) (174,313) (172,913)
1,249,937 1,194,426 1,202,846 1,422,074 1,495,824
1,018,680 1,051,134 1,082,129 1,106,165 1,180,050 6.7% 73,885
227,764 229,764 225,180 230,000 214,000 -7.0% (16,000)
1,246,444 1,280,898 1,307,309 1,336,165 1,394,050 4.3% 57,885
GENERAL FUND BUDGET SUMMARY
Requested
Actual
Actual
Actual
Budget
Budget
Percent
Dollar
2013
2014
2015
2016
2017
Change
Change
FIRE
Support Services and Charges
345,728
348,788
360,644
369,714
372,976
0.9%
3,262
Capital
287,655
278,423
276,156
270,620
256,648
-5.2%
(13,972)
Total Fire
633,383
627,211
636,800
640,334
629,624
-1.7%
(10,710)
PROTECTIVE INSPECTIONS
Personnel
123,411
117,530
126,299
126,299
126,299
0.0%
Materials and Supplies
-
157
73
200
200
0.0%
-
Support Services and Charges
6,813
6,176
9,887
8,050
10,550
31.1%
2,500
Total Protective Inspections
130,224
123,863
136,259
134,549
137,049
1.9%
2,500
Total Public Safety
2,010,051
2,031,972
2,080,368
2,111,048
2,160,723
2.4%
49,675
CITY ENGINEER
Personnel
460
-
-
-
-
-
Materials and Supplies
-
612
-
-
-
Support Services and Charges
68,690
72,181
91,100
89,725
89,725
0.0%
Total City Engineer
69,150
72,793
91,100
89,725
89,725
0.0%
PUBLIC WORKS SERVICES
Personnel
434,212
344,742
381,502
516,365
516,365
0.0%
Materials and Supplies
141,763
132,205
103,882
163,000
160,200
-1.7%
(2,800)
Support Services and Charges
105,845
95,277
103,058
131,100
166,100
26.7%
35,000
Capital
-
-
-
-
-
-
Transfers
772,500
800,000
830,000
860,000
890,000
3.5%
30,000
Total Public Works Services
1,454,320
1,372,224
1,418,442
1,670,465
1,732,665
3.7%
62,200
SNOW AND ICE CONTROL
Personnel
56,862
61,363
26,537
61,465
61,465
0.0%
-
Materials and Supplies
44,835
34,444
16,229
44,000
44,000
0.0%
Total Snow and Ice Control
101,697
95,807
42,766
105,465
105,465
0.0%
-
Total Streets & Highways
1,625,167
1,540,824
1,552,308
1,865,656
1,927,856
3.3%
62,200
less transfers
(772,500)
(800,000)
(830,000)
(860,000)
(890,000)
3.5%
(30,000)
Net Streets & Highways
852,667
740,824
722,308
1,005,656
1,037,856
PARKS MAINTENANCE
Personnel
82,222
121,626
150,919
115,022
115,022
0.0%
Materials and Supplies
18,908
15,610
17,907
23,300
23,300
0.0%
Support Services and Charges
38,816
35,537
35,492
40,500
40,500
0.0%
Total Parks Maintenance
139,946
172,773
204,318
178,822
178,822
0.0%
RECREATION
Personnel
51,296
42,666
43,414
41,575
41,575
0.0%
Materials and Supplies
4,818
7,496
5,739
7,700
7,700
0.0%
Support Services and Charges
13,051
6,185
4,640
13,900
13,900
0.0%
Transfers
42,000
42,000
42,000
42,000
42,000
0.0%
Total Recreation
111,165
98,347
95,793
105,175
105,175
0.0%
Total Recreation
251,111
271,120
300,111
283,997
283,997
0.0%
-
less transfers
(42,000)
(42,000)
(42,000)
(42,000)
(42,000)
Net Recreation
209,111
229,120
258,111
241,997
241,997
GENERAL FUND TOTAL EXPENDITURES
5,328 416
5,511,462
5,307146
5,857 087
6,041,312
3.1%
184,225
NET OVER /(UNDER)
351,860
26,098
433,348
(180,148)
(192,785)
7.0%
(12,637)
(Planned Use of Fund Balance)