A. Budget for 1992 Ii
CITYOF
CHANHASSEN
690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
1 (612) 937-1900 • FAX (612) 937-5739
MEMORANDUM
TO: Mayor and City Council
1 FROM: Don Ashworth, City Manager
DATE: October 28, 1991
SUBJ: Informational Budget Hearing, 7:00 p.m. Monday Evening
1 State law is very specific in requiring the state's "Truth in
Taxation" form to be published no more than 10 days prior to the
city's hearing date and not less than 5 days before such date.
' This process is bad from two aspects - 1) the form itself is flawed
in that it does not take into account new values which will come in
place in 1992 , and thereby incorrectly shows a sizeable tax
increase; and 2) it gives the citizenry a very limited amount of
1 time to either question the budget or become knowledgeable of it.
One of the letters received this past year clearly stated this
point. The writer felt that by his attending the December 11
1 meeting, and watching the Council act to increase a budget with
little or no interaction between the Council, was totally
inappropriate. What the writer was unaware of was the fact that
1 the Council had met continuously for the previous two months before
getting to that final hearing date.
To avoid a similar problem this year, staff is proposing to hold a
1 series of budget update meetings in advance of regular Council
meetings. The purpose of the meeting would be to inform citizens
of the requirements of state law, why that has created problems for
1 our city in previous years, and to provide information on the
current status of the budget, i.e. we would note that the Council
has met with department heads and has received the initial requests
1 from those departments. We would also invite persons present to
examine copies of those documents. In this week's edition of the
Villager is a copy of the notification form for the series of
budget meetings (attached) . As can be noted, the final meeting is
1 the official public hearing date at the end of November.
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The Council is welcome to sit in their Council seats or in the
1 audience. The advantage of making it an administrative
presentation recognizes that staff can then state that we are in
the preliminary stages of the budget and that the City Council has
1 not seen revenue figures and has not taken any position in regards
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Mayor and City Council
October 28, 1991
Page 2
to potential property tax levels for 1992 . Again, the process is
solely one to ensure that citizens are given adequate time to
11 review the budget documents and to make their comments known before
we get into stringent time frames set out under state law.
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City of Chanhassen
Budget Process for 1992 Budget I
1992 Property Tax City of Chanhassen
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Distribution Maximum 1992 Property
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1991 1992 Change
u t t ><< : Tax Levy $3,102,100 $3,385,770 9.1%
Cony I
and State Aids 969984 1,017933 49%
School District
Net Levy 2,132,116 2367,837 11.1%
Tax Base Growth 7.1% 1
22¢of each tax dollar goes to the city. Net Property Tax Increase 4.0% *
For 1992,the maximum increase is *Note: This estimate is solely for the City of I
estimated at 4.0%. Chanhassen and does not reflect changes
created by the county or school districts.
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This notice was published for these purposes
✓ To invite public participation in the City's 1992 budget process. Budget discussions are I
scheduled for 7:00 PM on October 28 and November 4 at City Hall, 690 Coulter Drive.
The final hearing is scheduled for 7:30 PM November 18, 1991.
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✓ To notify City of Chanhassen property owners that:
The property tax form which will be sent to each property owner by the county will only
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show the third line shown above, i.e. a proposed city property tax increase of 11.1%.
This figure is incorrect in that new growth (new property taxes) has increased 7% over
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the level existing in 1991. Accordingly, the maximum increase is only 4%.
The net increase of no more than 4% is the City's maximum levy. The City is starting
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the budget process and the goal for 1992 is to have no City created property tax increase.
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December 12, 1990
Mr. Dan Chmiel
Mayor
1 7100 Tecumseh Lane
Chanhassen, MN 55317
Dear Mr. Chmiel:
Recently, my family and i moved to Chanhassen and we have become
increasingly concerned over the issue of escalating property taxes. I
was compelled to attend the city council meeting on December 11 to
voice my concerns and verify my anxiety with other members of the
community. To say the least, I was shocked and appalled with the
forum used to review this critical issue and the apparent lack of
sensitivity demonstrated by the city council members. •
I feel that it is highly inappropriate and ineffective to schedule the
public hearing portion of the meeting, where concerned members of
the community can voice their concerns and make the city council
' aware of their points of view on the matter, prior to the full
disclosure of the city planner and reactions of the council members
whos function is to assess and represent the views of the
' community! If the purpose of the public hearing is to sincerely take
into consideration the views and concerns of the community
members, then arrange for this community input at a time when the
issues have been outlined by the city counsel, discussion on the
issues has taken place, and prnposale as to the course of action have
' been made. Then a vote on the issue could be made taking into
• consideration the view points from those members of the community
that took the time to attend and offer their input on the matter.
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Mr. Chmiel
December 12, 1990
Page 2 1
I think it was a rash and capricious decision to ignore the many
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points of consideration for possible budget reductions raised by the
city planner and from the other council members, and take a vote on
the only proposal made up to that point in time! It is ironic to me
that the only proposal made from anyone on the council was for the
full 13% tax increase necessary to balance the budget!!!!!!iii!IIIIIIIIIiii
Unfortunately, I left the city council meeting feeling helpless and 1
very disillusioned with our local government.
Sincerely, 1
James L. Pehringer, M.S.
1010 Lake Susan Hills Drive
Chanhassen, MN 55317
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iTy OF
CHANHASSEN
690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
(612) 937-1900 • FAX(612) 937-5739
October 24, 1991
Mr. James L. Pehringer, M.S.
1010 Lake Susan Hills Drive
Chanhassen, MN 55317
Dear Mr. Pehringer:
' In reviewing the budgetary files from this past year, I found your
letter of December 12, 1990. I did not find a response. If,
somehow, a response was missed, I sincerely apologize. In addition
1 to apologizing, I believe it is important to note that your
concerns did not go unnoticed. Attached please find a copy of my
report to the City Council regarding the 1992 budget. I have used
your letter and concerns as the foundation for why the city cannot
continue following solely the suggested procedures of the State of
Minnesota. We must adopt additional local procedures to ensure
that our citizens do have an opportunity for input and that that
' input process occurs in advance of the formal hearing process
dictated by the State.
You note in your letter that the city is7.proposing a 13% increase--
I such being excessive. During the discussion process, I attempted
to state that the State's process of calculating tax impact is
significantly flawed and that the proposed budget for 1991 was not
anticipated to create a tax increase. It was our estimate that, if
anything, a minor decrease would occur. I was hoping to test your
property to show whether this prediction was correct or incorrect.
Unfortunately, your property only had a partial value for 1990 and
a direct comparison was not possible. A comparison can be done by
using one of your neighbor's homes and comparing their tax for 1990
to yours. The neighboring value used was $188,10, which produced
' a 1990 tax bill of $4,564.27. :For 1991, the taxes on your home,
valued at $187,800, were $4,408.00; Although the decrease was not
substantial, a tax decrease did occur.
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For 1992, the form required to be sent to property owners will show
that the city is proposing an 11. 1% increase. The same 'fallacies
' that existed in 1991 currently exist. The maximum increase that
the city could look to levying would be approximately 4%. As I
attempted to note last year, as well as being repeated this year,
is that the city has never levied to its maximum authority. I
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Mr. Pehringer
October 24, 1991
Page 2
sincerely doubt that the City Council will go to that maximum levy
amount and feel very confident in stating that the budget that will
be submitted to the City Council will not create a tax increase for
the city portion of your property tax bill.
Again, I sincerely apologize if we failed to respond to your letter
from one year ago. I would be interested in hearing from you if
the process adopted for 1992 better matches your original
anticipation of how a budget process should work. I would
additionally be interested in any additional comments you may have. I
Sincerely,
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Don Ashworth '
City Manager
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