During the Sept. 9 Champlin City Council meeting, the mayor and council certified the 2020 proposed city property tax levy and adopted the 2020 preliminary operating budget.
Champlin’s finance director, Shelly Peterson, gave an overview of both the tax levy and operating budget, which must be submitted to Hennepin County by Sept. 30.
“The operational levy in front of you is $10.5 million with a debt service levy of $754,000 for a gross levy of $11,318,806,” Peterson said. This proposed levy represents a 9% increase from last year’s adopted levy or a difference of $935,000.
Since this is a proposed levy, the final adopted levy must be equal or less than the proposed amount, Peterson added. A final levy must be approved by the council by Dec. 30.
Then, Peterson explained how the proposed levy would affect a median-valued home. Peterson said, according to Hennepin County, the value of an average home in Champlin is expected to go from $237,000 to $253,000 in 2020. With the value increase, it is expected that the city portion of taxes will jump from $843 to $932, which is an $89 increase from 2019 or $7 increase per month on mortgage payments.
“The proposed levy is the primary funding source to our general fund,” Peterson said. Specifically, the levy provides 74% of the revenue necessary to support day-to-day operations of the city, 51% of the budget is personnel costs, and 26% is dedicated to support capital and infrastructure, Peterson added.
The 2020 preliminary general fund budget total revenues and expenditures are both $14,358,900, which is an 8% change from last year. Peterson said some of the key factors of the increase are: mandated pension increase and employee contract requirements, allocation of fire joint powers agreement, insurance increases for workers compensation and liability, election year expenses, communication improvements, expansion of community engagement and recreational programming, and park and trail referendum feasibility study and needs analysis.
Additionally, over half of the levy increase is a $565,000 increase in the transfer to support infrastructure and rehabilitation. “It’s important to note that we’ve got $56 million in street projects planned over the next five years,” Peterson said. In addition to street repairs next year, this increase in the infrastructure and rehabilitation category includes build reserves for the Champlin Ice Forum refrigerant unit and roof replacement.
In response to the increased transfer to support infrastructure, Mayor Ryan Karasek said, “We’re not unique of any other city in Minnesota that has struggled with difficult winters, tough street issues, and increased transfers into our infrastructure.”
Karasek said the council has recognized street issues as a real problem and is addressing it head on.
Peterson also gave an overview of the 2020 proposed Housing and Redevelopment Authority (HRA) levy, which amounts to $441,885 and is consistent with last year’s levy. The HRA levy’s estimated impact to a median-valued home is about $4 annually or 33 cents, Peterson added.
After Peterson’s presentation, Mayor Karasek said, “We operate a very responsible, fiscally conservative city and a lot of that has to do with the leadership of not only the past, but the leadership of our staff in monitoring all of this, and you do an exceptional job at presenting us the information that we need to make good decisions.”
Ultimately, the mayor and council unanimously approved a resolution certifying the 2020 proposed tax levy, adopted the 2020 preliminary general fund operational budget, and approved a resolution certifying the 2020 proposed HRA levy for economic development activities. Additionally, a public meeting to offer input on the tax levy and budget has been set for Dec. 9, prior to final adoption of each.