Finance Committee Agenda and Packet 2017 10 16

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City Council Finance Committee Meeting Minutes 09/18/17 Page 8 of 13 Levy is 5.184, the 2004 Library Bond Debt Service Levy will be 0.90 (to totally defease the bonds in 2018), and the Recreation Center Bonds Debt Service Levy was estimated at 2.75. Director Watson stated that the cap for the mil for the Recreation Center Bonds is 3.35. Director Watson reviewed with the Committee Members the second table provided which reflects the property tax amount due to the City on a residential property with an actual value of $500K, plus an 18% increase. For 2017, the property tax amount is $267. For 2018, Director Watson stated an increase of $109 to $376, and for 2019 a decrease of $39 to $337. Finance Committee Chairperson Stolzmann asked if the Residential Assessment Rate of 7.2% was fixed. Director Watson stated the rate is fixed for two years. Member Stolzmann asked what the increase in cost is to run the government and suggested the proportion of property tax increase reflect the increase in costs of City operations. Director Watson stated an operations cost increase of 6-8% not including CIP. Member Stolzmann stated that the City has had big increases for two years and has not turned -back any amounts to the residents. Member Maloney stated there needs to be consideration by the City of what would happen when property values stabilize or decline, or other economic hardship occurs. Director Watson stated that the General Mil Levy can be decreased, but once done, may not be increased back up again without a vote. Mayor Muckle stated that people want more services and that having more revenue diversity is a good thing. Mayor Muckle stated he does not want a special tax requested from the voters or imposed each time an added service is proposed. Council Member Lipton stated that the City cannot infinitely provide more services with constrained growth. Member Lipton stated that the City needs to balance CIP needs and better align the General Fund instead of trying to get a windfall. Interim City Manager Heather Balser asked if the Finance Committee had preliminary recommendations for staff. Finance Committee Chairperson Stolzmann stated that she understands all sides, but because there is not consensus on this issue, the matter needs to go to the full City Council without recommendation from the Finance Committee. Ms. Stolzmann requested staff provide analysis on tying the mil levy increase to the increase in operation costs as a percentage, in addition to the information provided in Director Watson's communication. The reports and corresponding narrative can be located in the packet of the September 18, 2017 Finance Committee Meeting. OPEN SPACE & PARKS FUND RESERVE POLICY 9