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7. 1990 Levy & Budget 114600:, 1 C1TYOF --� CHANHASSEN 1 , 1 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 ' ~' (612) 937-1900 ' MEMORANDUM TO: Mayor and City Council ' FROM: Don Ashworth, City Manager DATE: July 24 , 1989 SUBJ: 1990 Levy and Budget, Adoption A True Story Having Elements Similar to our Levy Dilemma ' Believing myself to be a good citizen, I applied for a drivers license shortly after moving to Minnesota in 1970 . I had never taken a drivers test, but I had been driving for nearly 15 years. ' In arriving at the driving exam area, I was convinced that the state had obtained the property via the vacation of a previous airport. I was instructed to drive up the four block runway #1 , 1 turn left onto air strip #3 , and return on taxi route #2. As I could see no other cars in the entire complex (nor airplanes) , I assumed that I would be able to follow the instructions relatively ' easy. Upon returning, I was notified that I had failed the test, i .e: - During the first block I had hit an imaginary car traveling towards me in that I was driving across the imaginary center line; and ' - In making my left hand turn, I collided with an imaginary car to my left in that I was driving in the imaginary second thru-lane and turned into the other imaginary thru- lane without checking my mirror; and - On the return trip I had hit an imaginary parked car by driving in the imaginary parking areas; etc. ' The above story is germane in that the state is requiring cities to adopt an imaginary levy and imaginary budget and they will not ' tell us what the rules are until after we have passed or failed the test. ■ Mayor and City Council ' July 24, 1989 Page 2 1 Consider the following factors: - An Imaginary Budget and Levy Must be Certified Prior to ' August 1st: This requirement comes out of the 1988 legislation. The fallacies with the new law were discover- ed after its passage, but the legislature knew that it had an opportunity in the 1989 legislative session to correct such prior to it becoming effective in August of 1989 . Unfortunately, the Governor vetoed the corrected version as included in the Omnibus Tax Bill. Some experts say that the August 1st date need not be complied with as the Revenue Department, Attorney General, and Legislators agree that doing such will not achieve original intent , of the Legislature. However, the law is on the books. A citizen could sue during 1990 (the collection date for taxes certified in 1989) and potentially negate the entire levy. In trying to determine what amount should be set for imaginary certification to the county and the imaginary revenue/expenditure amount of the 1990 budget (also required in the law) , the Council should consider the following: o Budget Process : The new law setting the August 1st date , does not modify the existing statute regarding time tables of municipal budgets . Specifically, the manager is to start the budgetary process during the summer ( legislation not specific in this area) and must submit that to the City Council on or before September 1st. The City Council must consider the proposed budget and deter- mine the amount of such/property tax levies prior to October 10th. City staff is proceeding to insure compliance with these statutes. An earlier than required submittal date is being worked on with the objective of having worksessions in August; and o Levy Limits: We have absolutely no knowledge as to what our levy limits will be. If the 1988 law stays on the books , we will be restricted to a 3% increase on the pre- vious years base plus an adjustment for i of our growth in homes or population. Neither of these factors are known. If a special session is held, the Legislature has stated that it would be the 3% limit, but on the amount actually certified rather than the amount allowed to be certified; o State Aids : Under current law, we would look to a zero percent increase in state aids . If a special session occurs ( readoption of aids included in the vetoed bill) , a 2% increase would exist; and ° Final Adoption In October/Maybe November/Maybe December/ Etc: No one knows when a final decision will have to be Mayor and City Council July 24, 1989 Page 3 made in establishing the true 1989 levy amount/budget. Assuming we stay with the most conservative approach and look to October 10th, that final adoption process cannot have a dollar levy amount which exceeds the amount adopted in the imaginary certification. That provision appears likely to survive whether the new session occurs or not, whether the 1988 law is enforced or not, etc. The short and long of all of the above is that the City Council must establish an imaginary certification and imaginary budget prior to August 1st. As we go through the normal budgetary pro- cess, the Council can change and reduce the imaginary cer- tification, but cannot increase it. Accordingly, this office would recommend that the Council adopt a resolution which is very explicit in stating that the certification/budget being adopted are not based on any facts or knowledge, they are not based on any logical review process , that they very definitely will be reduced prior to final certification in October, and that the Council is passing said resolution only to insure that legal recourse does not occur against the City/it' s citizens . In addi- tion, the Council may wish to include in that resolution a nota- tion that the amounts being set were produced solely by the manager based upon his best guesstimate as to overall limitations which may occur. That, again, the Council is adopting these amounts with full knowledge that such are proposed to be reduced as a part of the final adoption process . Hopefully the rationale used in establishing the recommended imaginary certification and budget is fairly well documented on the attached sheet. Approval of a resolution as described above incorporating the amounts shown on the attached sheet is recom- mended. Note: I am convinced that the 1990 budgetary process will not produce a tax increase and will, in fact, produce decreases. Last year we were the 3rd or 4th highest taxed community. For 1989 we have moved to 54th out of 95 . The 16th rank notation is deceiving in that it only shows that Chanhassen has the 16th highest average-priced home. So what? We probably have the 8th highest average income. The 20th average rental rates, etc. I do not see where the 16th ranking is germane to comparisons of property taxes . t-O&'rj .4)t) (:) ) • July 24, 1989 Proposed 1989/1990 Levy and 1990 Budget [Worksheet entries only with actual levies anticipated to be less when presented and considered by the City Council in October.] 1988 Levy Limit $1,843,464 1988 Actual Levy $1,842,900 (Collectible in 1989) Lesser of Limit/Actual Valuation = 14% Lessor/ 1,842,900 x Growth Adjustment Population = 12% 2 x 5% Households = 10% 1,935,045 Adjusted Limit x C.O.L. Adjustment x 3% Maximum Levy Limit 1,993,100 (Recommended 1989 Levy for collection in 1990) + Existing Bonded Debt Levy 604,855 (May only be used to pay principal and interest on authorized/appropriated bonded debt and therefore do not impact general certificate calculations above - see attached listing). + 1988 Voted Bonds - 1st Levy 1990 115,000 + 1989 Voted Bonds - 1st Levy 1990 91,000 (1.2M sold for Fire Station [Nov. , 1988] and reimburse .8M for Lake Ann, Park in southern Chanhassen in 1989) Total Proposed 1990 Levy $2,803,955 Enclosures: Pages 26 and 27 of 1988 Audit Report Debt Analysis Report - October, 1988 (Bonds of 1988 and 1989) 1990 Budget 1989 Aggregate Revenue Budget 4,605,620 Anticipated Budget Increase 8% 1990 Proposed Aggregate Revenue Budget 4,974,069 1990 Proposed Aggregate Expenditure Budget 4,974,069 Revenues over Expenditures -0- CITY OF CHANHASSEN,MINNESOTA � ., Page 26 of 28 • NOTES TO FINANCIAL STATEMENTS December 31, 1988 Note 14 DEFERRED AD VALOREM TAX LEVIES - GENERAL BONDED DEBT (Continued) Scheduled and actual debt service tax levies for the general obligation debt are scheduled to be as follows: Levy/Collection Scheduled Actual Percent Levied 1979/80 $54,115 $41,800 77.24% 1980/81 185,983 171,220 92.06% 1981/82 228,000 164,050 71.95% 1982/83 269,000 209,000 77.70% 1983/84 227,500 159,400 70.07% 1984/85 217,400 237,400 109.20% 1985/86 232,600 232,600 100.00% 1986/87 234,400 286,530 122.24% 1987/88 260,198 327,800 125.98% 1988/89 432,305 401,900 92.97% 1989/90 376,855 1990/91 318,500 1991/92 294,700 _ 1992/93 303,400 1993/94 303,600 1994/95 335,300 1995/96 337,700 1996/97 338,700 1997/98 364,400 1998/99 360,800 1999/00 387,000 2000/01 163,000 2001/02 180,000 2002/03 169,000 Note 15 DEFERRED AD VALOREM TAX LEVIES - SPECIAL ASSESSMENT BOND ISSUES Certain special assessment bond issues sold by the City are partially financed by ad valorem tax levies in addition to special assessments levied against the benefiting properties. When a bond issue to be financed partially or wholly by ad valorem tax levies is sold,specific annual amounts of such tax levies are stated in the bond resolution and the County Auditor is notified and instructed to levy these taxes over the appropriate years. These future tax levies are subject to cancellation when and if the City has provided alternative sources of financing. Alternatively, the City Council is required to levy any additional taxes found necessary for the full payment of principal and interest. These future scheduled tax levies are not shown as assets of the special assessment funds in accordance with generally accepted accounting principles. Revenue from these tax levies is recognized annually as explained under"Property Tax Revenue Recognition". Scheduled and actual debt service tax levies for general obligation special assessment bonds are as follows: CITY OF CHANHASSEN,MINNESOTA Page 27 of 28'164/' • NOTES TO FINANCIAL STATEMENTS December 31, 1988 • D , = , . • u - ' F BIND ISSUES (Continued) Levy/Collection Scheduled Actual Percent Levied 1979/80 $19,900 $23,700 119.10% 1980/81 19,600 25,500 130.10 1981/82 10,600 0 1982/83 45,100 0 1983/84 49,900 195,000 390.78 1984/85 54,900 180,000 327.87 1985/86 65,000 215,000 330.77 1986/87 85,000 190,000 223.53 1987/88 228,000 225,000 98.68 1988/89 228,000 113,000 49.56 1989/90 228,000 1990/91 233,000 1991/92 250,000 1992/93 255,000 1993/94 260,000 1994/95 260,000 1995/96 245,000 1996/97 265,000 1997/98 280,000 1998/99 295,000 1999/00 310,000 2000/01 525,000 2001/02 570,000 2002/03 55,000 l 1 1 DEBT ANALSIS - SUMMARY REPORT Last Update: 15-Sep-88 INCLUDES ALL SPECIAL ASSESSMENT,GENERAL OBLIGATION, EQUIPMENT CERTIFICATE 11:00 PM AND TAX INCREMENT BONDS (ALL DEBT) Date Appr'd: ACTUAL (----<---:----)----)----) PROJECTED J1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003, TOTAL PROPERTY TAX LEVIES 11t1titttttitttt11t1111$ SPECIAL ASSESSMENT FUNDS Bonds of 1972/1973 150,000 150,000 150,000 150,000 Revised 72/73 (75,000) 175,000) (150,000) Ref. Bands of 1978 i Bonds of 1983 Ref. Bonds of 1983 60,000 $80,000 $80,000 $80,000 $80,000 $85,000 $85,000 $85,000 $90,000 $85,000 Revised 83 ($80,0001 ($80,0001 ($80,0001 ($80,000) ($85,000) ($85,000) ($85,000) ($90,000) ($85,000) Bonds of 1984 $35,000 Bonds of (906 Total Levy 148,000 148,000 148,000 148,000 148,000 165,000 (70,000 170,000 175,000 245,000 265,000 280,000 295,000 310,000 525,000 570,000 55,000 3,965,0 SAC Collections (33,000) (33,000) (35,000) (35,000) 135,000) (35,000) (35,000) (35,000) (35,000) (35,000) (35,000) (35,000) (35,0001 (35,000) (35,000) (35,000) (35,000) (591,0 Bonds of 1987 Bonds of (988 Bonds of 1989 SUB-TOTAL 210,000 190,000 225,000 113,000 113,000 (13,000 130,000 (35,000 (35,000 140,000 210,000 230,000 245,000 260,000 275,000 490,000 535,000 20,000 3,769,0 GENERAL OBLIGATION DEBT MWCC 11,300 11,300 11,300 Munc. Bldg Bonds 146,100 148,900 151,300 153,400 155,100 156,500 162,700 173,400 177,600 186,300 (93,700 199,700 204,400 207,800 215,000 33,9, 1988 Fire/Equip Bonds 130,000 115,000* 110,000 135,000 (35,000 130,000 150,000 150,000 140,000 160,000 155,000 (75,000 165,000 (80,000 170,000 2,631,4 1989 Park Bonds 91,0003( 80,500 77,000 94,500 94,500 91,000 105,000 105,000 98,000 112,000 108,500 122,500 115,500 126,000 Sub-Total Gen. Obiig 157,400 160,200 162,600 283,400 361,100 347,000 374,700 402,900 402,100 427,300 448,700 444,700 462,400 474,800 498,500 287,500 EQUIPMENT CERTIFICATES Existing Equip. Cert. 86,500 137,630 176,500 223,500 212,000 54,000 0 Equip. Revol Cert. 0 0 0 50,000 55,000 240,000 250,000 260,000 270,000 280,000 290,000 300,000 310,000 320,000 330,000 340,000 350,000 890,1 TAX INCREMENT BONDS 0 0 0 0 0 0 0 0 0 0 TOTAL TAX LEVIES 453,900 487,830 564,100 619,900 736,100 569,000 744,700 787,900 797,100 837,300 938,700 964,700 1,007,400 1,044,800 1,093,500 1,107,500 1,170,500 666,000 7,324,9 t REQUIRED DEBT LEVY 8.17 7.83 8.09 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 OPERATIONAL LEVY 20.20 18.53 18.58 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 14.00 TOTAL PROJECTED LEVY 28.37 26.36 26.67 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 i i 1 a. 2A F St.Paul Pioneer Press Dispatch Saturday,July 8,19891 ( p 1989 TWIN CITIES AREA PROPERTY TAXES pi (� er - ' $80,000 house Average-priced house CI'� n 1989 Rank Average 1989 Rank J 3" est. 1(high) house est. 1(high) •• P 4 Community tax to 95 price tax to 95 r Afton $654 84 $131,149 $1,744 15 =f ,� Andover Anoka 715 820 70 93,256 980 29 77,606 737 47 1 83 41.v' *' Apple Valley 766 52 106,831 1,413 21 _, � Arden Hills 752 57 124,459 1,790 13 Bayport 739 62 92,139 793 71 DM 1 r Belle Plaine 927 8 69,499 630 91 lJ �,. Blaine 856 19 78,710 782 73 1 Bloomington 817 31 104,212 1,350 23 Brooklyn Center. . . .742 61 76,727 674 89 Brooklyn Park 933 5 85,554 1,007 44 FL Burnsville 752 58 102,465 1,292 26 You - Champlin 833 83,884 848 62 Chanhassen 765 53 118,684' 1,608 16 Hot Chaska 616 90,433 775 74 Bra 1 Circle Pines 845 23 83,033 907 56 11101•Columbia Heights . . .803 38 76,763 680 88 Columbus Twp. . .. .704 75 89,709 894 59 Vog Coon Rapids 831 26 81,978 842 63 Corcoran 749 59 101,319 1,199 33 Cottage Grove 737 64 88,287 774 75 Crystal 809 35 77,135 696 86 Bloom Dayton 780 46 87,410 902 57 Deephaven 848 21 179,950 3,453 3 Eagan 676 80 98,881 1,127 35 East Bethel 781 45 77,157 611 93 Eden Prairie 847 22' 120,559 1,820 _ 12 Edina 624 87 144,340 1,992 1.. 8 Excelsior 960 2 91,609 1,229 = 30 • Falcon Heights 749 60 112,521 1,436 's-'20 Farmington 874 16 73,252 769 ' -'"76 Forest Lake 714 71 80,199 718 -:...84 Forest Lake Twp. . . .576 93 100,663 945 l. 53 Fridley 850 20 85,398 972 -149 Golden Valley 709 74 111,316 1,351 ..,.,,22 Grant Twp 635 86 143,885 1,978 f';'10 Ham Lake. .-... . ..688 77 84,398 744 x;1;;•80 Hastings 761 55 79,423 755 .;;;�,;79 • Hopkins 731 66 88,819 915 - 55• Hugo 614 91 105,045 998 C .45 Independence 799 _ 41 113,127 1,511 .''.'4 18 i Inver Grove Heights. .640 : 85 90,846 894. .:.M58 ' Jordan 867 18 67,634 617 . 92 Lake Elmo 587 92 130,484 1,443 _t`•19 Lakeville 666 82 95,855 1,030 -,.�:.i 42 Lino Lakes 911 9 88,389 1,096 .<.:<.:38 Linwood Twp 733 65 72,781 596 ,yip;.94 ( Little Canada 889 14 91,017 1,101- „ 37 Mahtomedi...... ..713 72 103,050 1,247'-'-•; 29 Maple Grove 893 13 93,904 1.199 ,;w.!. 34 Maplewood 904 11 88,636 988 ', 46 Medina 811 34 139,545 2,250-?;*'";>_: 7 Mendota Heights. . . .515 95 152,495 1,848 11 a Minneapolis 831 27 77,449 741 - 81 Minnetonka 910 10 122,089 1,988 9 Minnetrista 719 68 147,027 2,289 , ' 6 Mound 789 43 85,610 883 :1 61 Mounds View 727 67 88,594 886 = 60 3E New Brighton 739 63 105,916 1,280 `_ 27 New Hope 793 42 90,618 1,023 43 New Scandia Twp.. . .620 88 100,248 953 52 1 Newport 819 30 75,084 766 77 North Oaks 677 79 233,622 4,463 1 ! North St.Paul 772 50 82,871 737 82 Oak Grove Twp 803 39 84,026 821 69 • Oak Park Heights . . . 775 48 77,149 651 90 Oakdale 766 51 84,568 830 66 Orono 657 83 191,046 3,255 4 C Osseo 933 6 76,719 757 78 Plymouth 784 44 121,060 1,775 14 Prior Lake 938 4 107,945 1,602 17 Ramsey 806 37 82,762 832 65 Richfield 779 47 82,737 837 64 Robbinsdal• 877 15 78,008 "794 70 Rosemount 764 54 85,214 '279 28 Roseville 812 33 100,723 St.Anthony 932 7 94,635 1,213 31 St.Louis Park 837 24, 86,474 956 51 J St.Paul 968 1 75,412 824 68 St.Paul Park 687 78 74,216 574 95 Savage 956 3 93,327 1,201 32 Shakopee 900 12 87753 1,108 36 Shoreview 719 69 109,214 1,321 24 Shorewood 873 17 154,299 2,831 5 South St.Paul 815 32 71,774 682 87 Spring Lake Park . . . 827 28 78,015 783 72 i Spring Lake Twp. . . .698 76 92,672 1,038 41 • Stillwater 757 56 91,810 969 50 Vadnais Heights. . . . 806 36 96,986 1,087 39 'i Waconia 802 40 82,191 825 67 mu j Wayzata 615 90 218,926 3,627 2 West St.Paul 558 94 89,226 713 85 White Bear Lake.. . .775 49 91,672 941 754 White Bear Twp.... .672 81 102,681 1.048 At 40 1111111111111,111 _..._ Woodbury 713 73 108.395 1,302 i. , ..... , r• - ► ?a ....e:. CITY OF CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 rA (612) 937-1900 NOTE TO: Don Chmiel FROM: Don Ashworth DATE: July 24, 1989 SUBJ: Weeds in the Downtown I received your note regarding cleaning up weeds in the downtown area. We are continuing the struggle with the sub-contractor (Noble Nursery) regarding dead trees, credits , etc. Most of the island areas were not properly planted, i .e. little or no black plastic was used, mulching improperly installed (non-existent) , etc. I have received assurances from BRW that they will get the contractor to remove all dead trees/bushes within the downtown area as well as to redo the plastic/mulching. A key meeting is set for this Wednesday. I will try to keep you posted as to the outcome of such and the agreed upon dates of starting work. )\_C4 (q;C) E CITY OF 4 - if . CHANHASSEN -,, .. , 40f '1 It � _ vim, 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937-1900 NOTE TO: Don Chmiel FROM: Don Ashworth DATE: July 24, 1989 SUBJ: Weeds in the Downtown I received your note regarding cleaning up weeds in the downtown area. We are continuing the struggle with the sub-contractor (Noble Nursery) regarding dead trees, credits, etc. Most of the island areas were not properly planted, i .e. little or no black plastic was used, mulching improperly installed (non-existent) , etc. I have received assurances from BRW that they will get the contractor to remove all dead trees/bushes within the downtown area as well as to redo the plastic/mulching. A key meeting is set for this Wednesday. I will try to keep you posted as to the outcome of such and the agreed upon dates of starting work. i■,(1) (:),,0,:;;T) CITY OF c ANBAssEs 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937-1900 MEMORANDUM TO: Don Ashworth, City Manager FROM: Scott Harr, Assistant Public Safety Director DATE: June 6 , 1989 SUBJ: Eurasian Water Milfoil I have advised Mr. DeCatur that assuming the required treatment costs would remain under $15,000 for this year (assuming the Council approves the following budget amendment) , I suggested to him that we consider including something in the 1990 budget as well. Budget Amendment - Fund 208 Adm. Trust June, 1989 Prey. Allocations Reallocation Difference Revenue Charges for Services $116, 000 . 00 $126 ,000.00 $10 ,000 .00 Expenditures $220, 000. 00 $230, 000. 00 $10 , 000. 00 0 cc: Jim Chaffee, Public Safety Director •, , CITY C IT ,,-, - ,..,,, . -,. , - X1/4L ....„,‘- • 0 ti.. . ANBAssEN .......„. . ._. 690 COULTER DRIVE •• P.O. BOX 147 •• CHANHASSEN, MINNESOTA 55317 R (612) 937-1900 June 14, 1989 Mr. Steve DeCatur 6645 Horseshoe Curve Chanhassen, MN 55317 Dear Steve: Attached please find my memorandum concerning sign installation, which I have requested to proceed A.S.A.P. Also attached please find a copy of the memo being submitted to Don Ashworth regarding the budget amendment for this matter. I hope things continue to progress at a satisfactory pace. I P. Scott Harr Assistant Public Safety Director SH:ks C: Jim Chaffee, Public Safety Director Enclosure • CITY OF A CZAHHASSEN ,„„, 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937-1900 MEMORANDUM TO: Gary Warren, City Engineer Jerry Schlenk, Street Superintendent FROM: Scott Harr, Assistant Public Safety Director DATE: June 14, 1989 SUBJ: Sign Placement Attached please find a copy of a letter from Steve DeCatur, who is the citizen representative spearheading the water milfoil program. Part of the accommodations that the City has agreed to provide is to install the signs that we now have. (For your information, we have 25 of the orange and green signs, with the statement "Milfoil Kills Lakes" at the top. ) This letter speci- fically sets forth the three Lotus Lake points in which he is requesting signs. Also enclosed is information from Mr. Eldon Berkland regarding the three locations for sign placement around Lake Riley. We also need signs placed at each municipal access point at each lake in the City. In addition to the signs, I ordered two posts for each installa- tion. It is imperative that this installation be accomplished as soon as possible as the infestation of water milfoil is rapidly choking out Lake Minnetonka, and all of our research with the DNR leads us to believe that infestation in Chanhassen lakes is immi- nent. Would you please advise me of the status of these installations? C: Steve DeCatur Jim Chaffee, Public Safety Director Attachments /14, �. . C I T Y 0 F 7' CHANIIASSEN x-u 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937-1900 MEMORANDUM TO: Jim Chaffee, Public Safety Director 6 FROM: Scott Harr, Assistant Public Safety Director DATE: July 21, 1989 SUBJ: Eurasian Water Milfoil This memo is to advise you that we have had a confirmed sample of eurasian milfoil brought in from a resident on Lake Minnewasta . Lake Restoration, Incorporated has inspected the site, finding only northern milfoil (which apparently does not pose a problem) growing; however, the fact that eurasian was found in the lake indicates that there is eurasian water milfoil in Lake Min- newashta. I have asked that Lake Restoration, Incorporated provide me with a quote for inspecting the lake, so that we can have an idea what cost it would be to eradicate the eurasian milfoil . C: Don Ashworth, City Manager Todd Gerhardt, Assistant City Manager