E. Preliminary 2012 Budget Discussion0
CITY OF
CHANAASSEN
7700 Market Boulevard
PO Box 147
Chanhassen, MN 55317
Administration
Phone: 952.227.1100
Fax: 952.227.1110
Building Inspections
Phone: 952.227.1180
Fax: 952.227.1190
Engineering
Phone: 952.227.1160
Fax: 952.227.1170
Finance
Phone: 952.227.1140
Fax: 952.227.1110
Park & Recreation
Phone: 952.227.1120
MEMORANDUM
TO: Mayor and City Council
FROM: Greg Sticha, Finance Director 6�
DATE: June 27, 2011 DK<5-01 -
SUBJ: Preliminary 2012 Budget Discussion
BACKGROUND
L.
It is that time of year again when we begin preliminary discussion of the 2012
budget. At this work session, the council will receive information on some of the
factors that will influence the 2012 budget. Staff would like council feedback on
any items of concern and direction for department heads as they prepare their
budgets. It should be noted that staff will be reviewing operational efficiencies
and effectiveness, and identifying key drivers affecting cost and service
performance levels, with the goal of achieving the right balance for each
department. For example, the recent law enforcement review led to a reduction in
overhead.
Fax: 952.227.1110
We have included a calendar for the rest of the year reflecting meeting dates and
significant deadlines for completion of the 2012 budget. If any of the dates
Recreation Center
appear to conflict with other known city deadlines or budget requirements, please
2310 Coulter Boulevard
let me know as soon as possible. Staff has moved the detailed discussion and
Phone: 952.227.1400
department PowerPoint presentations forward to August rather than October, as in
Fax: 952.227.1404
previous years.
Planning &
Natural Resources Market Value & New Construction Value
Phone: 952.227.1130
Fax: 952.227.1110 Carver County has informed us that new construction growth for 2011 was
1.16 %. This new construction value has a direct impact on the budgeting process
Public Works and will result in an approximate $119,000 increase in new tax growth available
7901 Park Place
Phone: 952.227.1300 for 2012. The total market value for the cit y decreased (-
2.75% ) for 2011, which
Fax: 952.227.1310 is used for 2012 property taxes.
Senior Center It is extremely important to note that a decrease in total market value does not
Phone: 952.227.1125 mean property taxes will increase, assuming no change in the amount levied from
Fax: 952.227.1110 the previous year. In the simplest terms, the tax rate is a product of the total
Web Site taxable market value and the total tax levy dollars requested. Attached is an
www.ci.chanhassen.mn.us illustration that staff will review with council to help understand the decreased
value and the impact it will have on the city's tax rate and property tax bills.
Chanhassen is a Community for Life - Providing for Today and Planning for Tomorrow
Preliminary 2012 Budget Discussion
June 27, 2011
Page 2 of 2
Cost of Living
The Consumer Price Index (CPI) for 2011 has increased slightly (around .5% or
less) on a monthly comparison from the previous year.
RECOMMENDATION
Staff requests feedback from the city council regarding the level of the initial tax
levy and how many alternative budget scenarios the city council would like to see.
Staff would also like feedback on the budget calendar. This feedback will give
clear direction to department directors as they prepare their 2012 budget requests.
ATTACHMENTS
1. 2012 Budget Calendar
2. 2011 Assessment Worksheet Summary from Carver County
3. Property Value vs. Tax Illustration
F: \GregS\Budget\2012 Budget \6 -27 prelim bud discussion.docx
2012 Bud Let Calendar
Date
Task
Forum
April 25, 2011
Review I" quarter 2011 revenue activity
Work Session
June 27, 2011
Review Capital Improvement Fund Balances
Work Session
Discuss 2012 Budget expectations with City Council &
Work Session
review budget efficiency ideas /suggestions
July 1, 2011
Distribute 2011 General Ledger Detail,
2012 Operating Budget Preparation Worksheets,
2012 -2016 CIP worksheets
July 11, 2011
Review employee benefits with City Council
Work Session
July 11, 2011
2012 Payroll and Revenue Projections Distributed
July 22, 2011
Completed Operating Budget Forms Returned to Finance
July 25, 2011
Review 2 °d quarter revenue activity to date and review
Work Session
Snow plowing and trail plowing policy
August 1, 2011
Powerpoint for detailed budget discussion distributed
August 8, 2011
Preliminary Budget and Levy Discussion
Work Session
August 10, 2011
Department heads return their departments powerpoint
information
August 22, 2011
Work Session dedicated to detailed department review of
Work Session
Budgets (powerpoint presentation, cancel regular session)
September 12, 2011
Final review of preliminary 2011 Budget before
Work Session
Preliminary budget set at City Council Meeting
September 12, 2011
Approval/Certification of Maximum Proposed
City Council Meeting
Preliminary Levy to Carver County Auditor
September 30, 2010
All 2011 -2015 CIP Requests Returned to Finance
October 24, 2011
Review 3` quarter revenue activity, 2012 -2016 CIP, and
Work Session
rate study with Ehlers and Associates.
November 14, 2011
Continue Rate Study, Budget or CIP discussion
Work Session
November 28, 2011
Continue Rate Study, Budget or CIP discussion if needed
Work Session
December 5, 2011
Truth in Taxation Hearing
City Council Meeting
December 12, 2011
Adopt Final Levy & 2012 Budget and 2012 -2016 CIP
City Council Meeting
City of Chanhassen 2011 Assessment Summary
Chanhassen Value Distribution 2011
❑ Apartment 13 Other
1% 2/0
■ Commercial/
Industrial
12%
■ Residential
84%
■ Residential
■ Commercial /In
dustrial
❑ Apartment
❑ Other
Apartment
Other
Total
2011 EMV
$2,693,676,100
$416,858,200
$45,314,000
$46,202,200
$3,202,050,500
2010 EMV
$2,765,285,800
$435,747,600
$45,590,900
$45,976,600
$3,292,600,900
Total Value Change
($71,609,700)
($18,889,400)
($276,900)
$225,600
($90,550,400)
New Construction
$37,190,300
$0
$0
$0
$37,190,300
Market Change
($108,800,000)
($18,889,400)
($276,900)
$225,600
($127,740,700)
• New Construction
1.38%
0.00%
0.00%
0.00%
1.16%
• Market Change
-3.93%
-4.33%
-0.61%
0.49%
- 3.88%
2011 Total % Increase
-2.59%
-4.33%
-0.61%
0.49%
-2.75%
Chanhassen Value Distribution 2011
❑ Apartment 13 Other
1% 2/0
■ Commercial/
Industrial
12%
■ Residential
84%
■ Residential
■ Commercial /In
dustrial
❑ Apartment
❑ Other
Example of Effect on Tax Rate
With Market Value Decrease
YEAR 1
F 4
$10, 0, 00
Total Levy
$2,000,000 Taxable Market Value
X 25.00 Tax Rate
$10,000,000
Average Value Home: $350,000
City Property Tax Bill $1,500
$10,000,000
Total Levy
$1,800,000 Taxable Market Value
X 25.25 Tax Rate
$10,000,000
Average Value Home: $315,000
City Property Tax Bill $1,500