Overall levy is a 4.03% increase over last year
The Wayzata City Council has approved the city’s preliminary 2020 budget and tax levy.
Steve McDonald, the city’s contracted finance director, presented the proposed levy and budget at the Sept. 3 city council meeting. Under state law, cities are required to set a preliminary tax levy and submit it to the county by Sept. 30.
The preliminary 2020 total city tax levy was approved at $5.03 million, which is a 4.03%, or $195,000, increase over 2019.
The overall amount consists of a $4.55 million general fund levy for general operations, along with $223,000 for city infrastructure. The overall levy also includes further repayment of bond debts from the Ferndale Road reconstruction project ($36,000) and the purchase of the Big Woods Preserve ($219,000).
Historically, the city’s levy increase was around 4% in 2011 and 2012, more than 7% in 2013, just under 2% in 2014 and 2015, just under 3% in 2016, 2.24% in 2017, 1.55% in 2018 and 3.18% in 2019.
Wayzata’s current $28.72 million tax capacity is comprised of $18.54 million from residential properties, $7.92 million from commercial properties, $2.21 million from apartments and $40,000 from industrial properties. The figures represent an overall increase of 7.34%, or $1.96 million, for the city’s tax capacity over the previous year. For comparison, Hennepin County’s tax capacity increase is 6.71%.
Wayzata’s tax rate, which is used to calculate the amount of tax to be paid by all city taxpayers, has been on a downward trend during the past several years. The tax capacity rate was 23.35% in 2017, 21.75% in 2018, 21.67% in 2019 and is estimated at 21.01% for 2020.
The tax rate is determined by dividing the tax levy by the city’s total tax capacity.
The City of Wayzata is one of three major taxing authorities for residents, along with the Wayzata School District and Hennepin County. Approximately 20% of taxpayers’ bills are controlled by city government, with the school district, county and state making up the rest of the tax bill.
The city’s proposed budget for 2020 is $6.86 million, a 4% increase, or $264,000, over 2019. Of the $6.86 million, taxpayers will contribute $4.55 million (under the preliminary levy) in property taxes toward the general fund operations. That’s a 3.95% increase, or $173,000, over what taxpayers paid last year toward the city’s general fund. Around 66% of the city’s annual general fund revenue comes from taxes. Charges for services and licenses and permits are also large revenue sources at a combined total of $1.44 million.
Changes in the city’s revenue include a $20,000 increase for project inspections and increases for other building related activities.
On the expenditure side, wages and benefits increased $212,000, general liability and workers’ compensation insurance increased $55,000 and consultant services increased $86,000.
The preliminary levy sets the mark for the highest possible amount. The final budget and tax levy will be presented to the city council in December. Once approved, the final levy will be certified to the Hennepin County auditor and the Minnesota Department of Revenue.
A Truth in Taxation hearing will be part of the Wayzata City Council meeting Tuesday, Dec. 3.
To view the entire preliminary budget for 2020, visit Wayzata.org/AgendaCenter and open the agenda packet for the Sept. 3 city council meeting.
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