HomeMy WebLinkAbout11 05 2018 2019 Budget and Tax Levy Report
4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL WORKSHOP AGENDA REPORT
MEET-
ING
DATE:
NOVEMBER 05, 2018
AGENDA
ITEM:
GOAL
AREA
AND OB-
JEC-
TIVE:
# 2
High-Value City Services
1. Establish financial stability for all funds.
2. Design a comprehensive funding strategy for capital needs.
3. Ensure sufficient resources and staffing to meet service demands
PRE-
PARED
BY:
CATHY ERICKSON, FINANCE DIRECTOR
JASON ETTER, ACCOUNTING MANAGER
FRANK BOYLES, CITY MANAGER
TOPIC: 2019 BUDGET/TAX LEVY DISCUSSION
DISCUS-
SION:
Introduction
The purpose of this workshop is to discuss the proposed 2019 budget with the Council which will
be the subject of the December 3 truth in taxation hearing. Staff is looking for Council direction
regarding any proposed budget changes prior to the December 3 truth in taxation hearing.
History
Earlier in 2018, the City Council approved the annual budget schedule/calendar. Pursuant to that
calendar, on August 20, 2018, the Council held a workshop to discuss the preliminary 2019
budget and tax levy. A preliminary 2019 budget and property tax levy were prepared and pre-
sented at the September 17, 2018 council meeting and adopted. The budget schedule calls for
the City Council to review the proposed 2019 budget this evening. A public hearing and the final
budget adoption are scheduled for December 3, 2018.
The Council adopted preliminary 2019 budgets in the amount of $32,081,930 and a preliminary
2019 tax levy of $12,880,755.
Current Circumstances
At the September 17 Council Meeting, the Council approved the 2019 preliminary budget and tax
levy, but indicated additional work needed to be done. Staff is looking for Council direction re-
garding any proposed budget changes prior to the December 3 truth in taxation hearing.
Staff has attached the following documents from the September 17, 2018 Council Meeting
2
1) September 17, 2018 Council Agenda Report – 2019 Preliminary Budget and Tax Levy;
2) September 17, 2018 Council Resolution – 2019 Preliminary Budget and Tax Levy;
3) Exhibit “A” – Budget Overview
4) Exhibit “B” – Revenue and Expenditure Summaries
Estimated Tax Levy:
As a reminder, The Council provided direction to include funding for mandatory cost increases,
personnel additions, additional funding for trail and equipment replacement, additional funding for
street overlay, and one-time technology expenditures. The proposed preliminary tax levy adopted
by the Council on September 17 was $12,880,775. This action set the maximum tax levy for
2019. This levy amount can be reduced but cannot be increased for 2019.
The total proposed preliminary tax levy change of 6.65% is shown in the chart below. As
city manager it is my belief that this is the levy amount required to deliver services to our
community in the year 2019. Therefore I recommend that the city council adopt the budget
as proposed with no changes. If the council, as a body, believes that reductions are essen-
tial, then please advise the staff of the amount and allow us to make the reductions as we
deem most appropriate. A levy increase, as recommended by the staff, will result in a tax
increase of about 3.4% ($37) or less for over 50% of the homes in Prior Lake for the city
portion of the property tax.
3
Use of General Fund Reserves:
As a reminder, the Council supported use of General Fund reserves of $261,800 to fund several
one-time expenditures for salt/ice management and fuel, severance funding, proposed replace-
ment of the city’s phone system and website redesign.
The use of reserves is also detailed in the attached Sept 17 agenda report.
The tax levy provides services to our community while properly retiring debt and continuing our
infrastructure improvement efforts.
CIP:
The City Council and Staff have been proponents of long-term strategic planning and funding for
the maintenance and replacement of assets including infrastructure, facilities, vehicles, equip-
ment, etc. The City Council and Staff have incrementally increased the funding in each of these
funds to try to get it to a level that is consistent with the long-term needs. As a reminder, the
2019 budget includes the following large purchases that have been identified in the long-range
CIP plans. Information regarding 1) any vehicle adds and 2) replacement purchases greater than
$100,000 are detailed below.
Vehicles/Equipment:
Water Tanker: The budget includes $325,000 for the replacement of the water tanker. The re-
placement year for the water tanker has been shifted from 2024 to 2019. In previous years, the
replacement has been pushed off as staff tried to smooth the annual equipment expenditures
within the confines of the annual tax levy. The stainless-steel tank baffles have been repaired
multiple times. A refurbish vs replacement is too costly. Credit River and Spring Lake Townships
do not have water hydrants. The water tanker is used to get water to the townships when needed.
Equipment and building improvement purchases are reimbursed by the townships as part of the
Fire Agreement contracts and include the financing costs associated with these purchases.
9-Ton Tandem Axle: The budget includes $225,000 for the replacement of Unit 465 which was
originally purchased in 2003. The Equipment Replacement Plan includes an estimated life expec-
tancy of 12 years for this vehicle. The current truck is 15 years old due to the replacement being
deferred for the past 3 years. This particular truck is the last remaining International truck within
the City’s fleet. All new purchases are Freight Liners. The existing truck is in very poor condition
and is very difficult to service due to the scarcity of parts.
Tractor: The budget includes $124,000 for the replacement of Unit 505. This is a John Deere
tractor. This piece of equipment serves multiple purposes including turf management such as
mowing and aerating during the summer as well as snow removal for cul-de-sacs during the win-
ter. The current tractor was purchased in 2009. The Equipment Replacement Plan includes an
estimated life expectancy of 10 years for this vehicle, so it is due for replacement in 2019. When
this tractor was originally purchased it was intended to be used for turf maintenance only. It was
later retrofitted to facilitate snow removal in cul-de-sacs. The additional wear and tear on the trac-
tor from snow removal is evident and it needs to be replaced. The new tractor that is purchased
will be designed and come from the factory ready for both turf management and snow removal.
Facilities:
4
There are no planned/budget facilities expenditures greater than $100,000.
ENTERPRISE FUNDS
Included on Exhibit B are budget summaries of the three enterprise funds that the City operates.
Enterprise funds are used to account for “business-type activities” which include those primarily
funded through user charges. Like most cities, these funds are Water, Sewer, and Water Quality.
Water Rates, City Portion of Sewer Rate, and Storm Water Charge increases are based on Staff
recommendations made in conjunction with the approval of the Capital Improvement Program
(2019-2023). These rates are charged each billing cycle and intended to reimburse the City for op-
erating costs for each utility and a portion of the capital costs. At the CIP workshop on July 16,
and at the CIP Public Hearing on August 6, staff presented rate increases necessary to fund oper-
ations as well as capital projects identified in the Capital Improvements Plan. For example, in the
approved Transportation Plan, there are $3.7 million of water projects, $2.6 million of sewer pro-
jects, and $1.5 million of water quality projects planned over the next five years. These projects
are currently proposed to be funded out of fund balance. To do this, annual rate increases, and/or
the issuance of debt is necessary. Council has indicated their support for pay as you go in the
utility funds, so staff is not recommending any utility fund debt issuance for 2019.
The following items were discussed with the Council this summer as part of the Capital Improve-
ment Program (CIP) workshops, and the CIP public hearing. The 2019 budget has been updated
to reflect the following items that were approved in August as part of the adoption of the 2019-
2023 Capital Improvement Program.
Minimal street reconstruction with utilities in 2019:
As a reminder, due to the significant road projects in 2018 and 2019, Director Wedel recom-
mended one smaller scale street rehab in 2019 with no utility related work. The only 2019 utility
work will be on the CR 21/TH13/Main Ave/Arcadia road project for an estimated total of $100,000
and $250,000 for the water and street utilities respectively. This will give us an opportunity to
build cash reserves to fund some of the future year projects in the 2019-2023 CIP.
Summer Sewer Lock/Cost Break:
We bill sewer based on water consumption, however, we provide a summer sewer lock. (City ordi-
nance 704.404 Sanitary Sewer Rate Cap) Residents pay 1.5 times the average of the Feb and
April consumption for the June, August, October and December billing cycle. The billing cycles
cover the following time periods highlighted in blue:
The summer sewer lock is intended to consider pool filling, lawn and garden sprinkling, etc. that
do not flow into the sanitary sewer system. The summer sewer lock was established years ago.
This is reducing our annual billed sewer consumption.
Month Billing Cycle
Feb Nov 21 - Jan 20
Apr Jan 21 - March 20
June March 21 - May 20
Aug May 21- July 20
Oct July 21-Sept 20
Dec Sept 21- Nov 20
5
The Council indicated that they would support modifying or phasing out the summer sewer lock.
as a means of increasing the City’s billed sewer flow. (See July 16 CIP workshop report attached
for summer sewer lock specifics.) Staff is proposing eliminating the summer sewer lock for the
June and December billing cycles. This would generate about $100k in revenue annually. Resi-
dents would still receive the summer sewer lock on their August and October utility bills which
cover the period from May 21-September 20. This change has been reflected in the adopted
2019-2023 Capital Improvement Program Sewer Plan and the 2019 Sewer Fund budget. It will be
included in the updates to the 2019 Official Fee Schedule and Ordinance public hearing in De-
cember.
Met Council Portion of Sewer Rate (MCES)
The Metropolitan Council adopted a Regional Wastewater Charge for 2019 of $227.4 million.
MCES continues to use an allocation method to calculate each municipality’s charges. The
method uses 2017 calendar year flow to allocate the $227.4 million of total metropolitan charges
to customer communities. Based on the final MCES information, the 2019 cost increase for the
City of Prior Lake is 7.25%.
The MCES sets the rates based on the actual flow from 2017 (two years prior historical). The cost
increase is comprised of two components as follows:
1) A volume increase of 2.8% based on the change in metered flow from 2016 to 2017.
2) A rate increase of 4.4%. The MCES total regional wastewater charge is up 3.5%. The total
regional flow is down -.083%, but the cost is still spread over the same users. The City of
Prior Lake’s proportionate share results in a 4.4% rate increase.
Prior Lake’s portion of the 2019 Metropolitan Wastewater Charge is $1,544,728. It is the City’s intent
that the charges incurred from the MCES be considered a pass-through cost and that the residents
pay the actual cost of receiving the service. For 2019 the recommended rate is $2.81, an increase
of $0.14. Staff has reflected the MCES rate increase in the 2019 Sewer Fund budget.
Staff’s recommendation for each fund follows:
Fee Description 2018 Amount Proposed 2019
Amount
Utility Billing:
Water Rate – First 25,000
gallons
$4.67/1,000 gallons $4.81/1,000 gallons
Water Rate – Over 25,000
gallons
$6.44/1,000 gallons $6.63/1,000 gallons
Storm Water Charge $14.34 (residential)
$43.02/acre
$15.06 (residential)
$45.18/acre
Met Council Sewer Rate
(MCES)
$2.70/1,000 gallons $2.81/1,000 gallons
Sewer Rate – City $2.94/1,000 gallons $3.39/1,000 gallons
This results in a proposed annual utility cost increase of about $38 for an average user with water
consumption of 8,000 gallons/billing cycle. (This is a proposed total utility cost increase of 5.9%.)
Conclusion
Bottom line, the following general points can be made about the 2019 proposed budget and tax
levy:
6
➢ Proposed total tax levy increase is $803,150 or 6.65%
➢ Based on the proposed levy increase, the majority of property owners will see an increase
of 3.4% or less for the city portion of property tax.
➢ Proposed 2019 total budget is $32,081,930.
• -4.33% decrease from the 2018 originally adopted budget;
➢ Proposed 2019 General Fund budget is $12,767,768.
• 6.78% increase from 2018 original adopted budget;
➢ Total planned add to reserves is $380,112;
➢ General Fund planned use of reserves totals $261,800.
To prepare the final 2019 budgets and property tax levies, Staff is seeking direction from the
Council on:
1. Is there additional information you need?
2. Are there changes you would like made to the 2019 budgets prior to the December 3 pub-
lic hearing?
The Public Budget Meeting and adoption of the final 2019 budgets and property tax levies is
scheduled for Monday, December 3 at 7:00 pm. Also, scheduled for December 3 is the public
hearing to discuss the amendment of the Official Fee Schedule ordinance.
FINAN-
CIAL
IMPACT:
The impact on the tax levies and reserve balances were previously mentioned in this report.
Fee Schedule Revisions
Staff is proposing several changes to the fees listed in the Fee Schedule. The most significant
changes are as follows:
Street Overlay/Resurfacing Assessment is increasing by 6.4% to $1,276/Residential Equivalent
Density Unit (RED). This 6.4% increase is based on the Minneapolis Construction Cost Index av-
erage change from January-October 2017 to January-October 2018.
Other fee revisions (as outlined in the 2019-2023 CIP) are included for trunk and connection
charges. These fees are commonly adjusted on an annual basis, and a study is typically done as
part of the comprehensive plan update. Director Wedel is finalizing his review of the water/sewer
infrastructure costs as part of the comprehensive plan update, so these are preliminary fee
changes and may be adjusted when presented to the Council as part of the comprehensive plan
update.
• A 10% increase is proposed for sewer and stormwater trunk and connection fees to make
up for increased inflationary costs which have not been reflected in our development fees.
• A 4% increase is proposed for the water trunk and connection fees. Rates were last deter-
mined in 2005 as part of the comprehensive plan capital update. At the time, the plan con-
templated that the city would build its own water treatment facility, add a water tower, and
add wells. With the SMSC joint water treatment facility and water purchase agreement, we
anticipate our water infrastructure costs, adjusted for inflation, will be lower than antici-
pated in 2005.
• We are removing the street oversizing trunk fee from the fee schedule, per the recent court
ruling regarding the Woodbury case. We are currently reviewing options for collecting the
revenue necessary to meet our street buildout needs contemplated in our comprehensive
plan update.
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As noted above, modest rate increases are also proposed for the Water, Sewer and Storm Water.
ATACH-
MENTS:
1. September 17 Council Agenda Report – 2019 Preliminary Budget and Tax Levy;
2. September 17 Council Resolution – 2019 Preliminary Budget and Tax Levy;
3. Exhibit “A” – Budget Overview
4. Exhibit “B” – Revenue and Expenditure Summaries
5. July 16 CIP Workshop Report
4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL AGENDA REPORT
MEETING DATE:
AGENDA #
PREPARED BY:
PRESENTED BY:
AGENDA ITEM:
GOAL AREA AND
OBJECTIVE:
SEPTEMBER 17, 2019
9A
FRANK BOYLES, CITY MANAGER
CATHY ERICKSON, FINANCE DIRECTOR
JASON ETTER, ACCOUNTING MANAGER
CATHY ERICKSON
CONSIDER APPROVAL OF A RESOLUTION APPROVING PRELIMINARY
2019 CITY BUDGETS AND CERTIFYING PRELIMINARY 2019 CITY OF
PRIOR LAKE PROPERTY TAX LEVY TO SCOTT COUNTY DEPARTMENT
OF TAXATION
High-Value City Services
1.Establish financial stability for all funds.
2.Design a comprehensive funding strategy for capital needs.
3.Ensure sufficient resources and staffing to meet service demands.
DISCUSSION: Introduction
State statutes require that each taxing authority adopt a preliminary budget
and certify a preliminary tax levy for payable 2019 to the County on or before
September 30, 2018. The preliminary tax levy establishes the maximum that
the City can levy against properties in 2019.
The City’s tax levy is used (together with the preliminary levies of other taxing
entities) to assemble the parcel-specific truth in taxation notices for mailed
distribution in November prior to the public budget meetings in December.
At the meeting at which the City Council adopts a preliminary budget and
preliminary tax levy (September 17), the Council must announce the date,
time and place of the council meeting at which the 2019 budget and levy will
be discussed, and which allows for citizen input.
That meeting is scheduled for Monday, December 3 at 7 p.m. in the Prior
Lake City Council Chambers. This information must also be included in the
meeting minutes.
History
This year, the development of the 2019 budget began in April when Staff
presented to the Council a summary of the 2017 financial results, the long-
range plan and a debt overview. Two CIP workshops presentations were
also completed in the summer. Staff presented the 2019 projects that are
part of the 2019-2023 CIP. The impact of these updated plans on the debt
balance, tax levy, fund balance reserves and utility rates were a part of the
Council and Staff discussion.
Page 2
A third CIP workshop was added on September 4 that primarily addressed
Council direction on funding the city’s equipment replacement needs. The
overall tax levy proposed includes the CIP impacts on the levy which has
been part of the CIP discussions.
Current Circumstances
Budget Overview
A budget overview has been attached to this agenda report. It reflects
proposed amounts for the 2019 budget for the following funds:
General Fund
Debt Service Funds
Cable Fund
Capital Park Fund
Revolving Equipment Fund
Revolving Park Equipment Fund
Permanent Improvement Revolving Fund
Facilities Management Fund
Economic Development Authority
Water Fund
Sewer Fund
Water Quality Fund
The second page shows tax levy and budgetary comparisons from the 2018
adopted budget to the proposed 2019 figures.
Estimated Tax Levy
The Council provided direction to include funding for mandatory cost
increases, personnel additions, additional funding for trail and equipment
replacement, additional funding for street overlay, and one-time technology
expenditures. The proposed increase in the equipment levy presented at the
August 20 workshop was $25,000. At the September 4 CIP workshop,
Council provided staff with direction to add an additional $25,000 to the
equipment levy but reduce General Fund net expenditures by an equal
amount. To accomplish this, adjustments were made in the following areas
to reduce the General Fund Tax Levy by $25,000:
1. 2019 tax abatement budget was reduced by $14,000. The budget
was based on preliminary development plans with Versatile Vehicles
and PL Revival. Staff updated the budget based on the applicable
executed business subsidy agreements so both projects will receive
the assistance which they contemplated.
2. 2019 fire contract budget for revenue from Credit River and Spring
Lake Township was updated by $6,000 (approximately half to each)
to reflect the financing costs associated with the purchase of fire
equipment and building improvements as earlier directed by the city
council. Equipment and building improvement purchases are
reimbursed by the townships as part of the Fire Agreement Contracts.
Representatives of both townships have been advised that there was
likely to be an adjustment.
3. 2019 Building Inspection professional services budget of $50,000 was
reduced by $5,000. The reduced budget of $45,000 is for
Page 3
outsourcing building inspections based on anticipated 2019
development.
Use of General Fund Reserves:
The Council supported use of General Fund reserves of $261,800 to fund
several one-time expenditures for salt/ice management and fuel, severance
funding, proposed replacement of the city’s phone system and website
redesign.
The use of reserves is also indicated on the chart, and expenditure detail
shown below.
The total proposed preliminary tax levy change of 6.65% is shown in
the chart below. For over 50% of the homes in Prior Lake, this will
result in a tax increase of about 3.4% or less.
General Fund, Debt Service Funds, Cable Fund and funds that support
the Capital Improvement Plan (Capital Park, Revolving Equipment,
Revolving Park Equipment, Facilities Management Fund, Permanent
Improvement Fund/Street Overlay):
The 2019 budget and long-range Capital Improvement Plan (CIP) include
funding to accomplish the following things:
4.35%
1.61%
0.46%
0.23%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
1
9/17 Proposed Preliminary Budget & Tax Levy Change
Mandatory
CIP -All Tax Levy Components
Personnel Net Adds
Expenditures -Technlogy Plan Costs
CIP:
50k Trail Replacement
50k Equipment Replacement
Expenditures-Technology:
0k Phone System -(Use of Reserves $75k)
0k Website redesign -(Use of Reserves
45k)
23k IT Managed Services Contract
5k IT Network Support
Total: 6.65% $803,150
Personnel:
80k FTE Add #1 -start January 1
60k FTE Add #2 -start July 1
85k) Remove City Engineer
0k Severance Funding (Use of reserves $100k)
Mandatory:
318k Wage and Benefits per Contracts
49k Police Overtime
24k Parks, Comm Dev, Engr Overtime
20k Statutory PERA Contrib. Police/Fire
22k Workers Comp Insurance
37.4k Salt/Ice Management -(Use of Reserves $22.6k)
20.8k Fuel -(Use of Reserves $19.2k)
29.7k Current expenditure (cost inflation/transfers)
127k Debt Service
10k EDA Levy
132.7k) Offsetting Revenue
525, 150
195,000
55,000
28,000
Page 4
Mandatory Items:
Wage/COLA and Benefits per Contracts ($318k)
Department over-time pay adjustments to reflect workload and prior
years historical/actuals ($73k)
Statutory PERA Contribution for Police/Fire for a rate change from
16.20% to 16.95% ($20k)
Workers Compensation premium adjustment based on updated
experience modifier and proposed rate changes from the League of
MN Cities ($22k)
A typical winter season includes 16 snow events. The 2017-2018 season
had 24 snow events. The Council supported using general fund reserves
to replenish salt/ice management materials and fuel due to the additional
eight snow events that occurred.
Salt/Ice Management replenishment due to significant 2017-2018
snow events ($60k). Tax levy of $37.4k/Use of reserves of $22.6k
Fuel increase in unleaded and diesel prices and usage ($40k) Tax
levy of $20.8k/Use of reserves of $19.2k
Other current expenditure increases for cost inflation, etc. ($29.7k)
comprised of Utilities-$16k, Police Lexipol - $12k, Small equipment
for Central Garage and Bldg. Dept- $14k, debt transfer for FS#2 MV -
7k, and offsetting reduction in tax abatement budget ($14k)
Debt service ($127k) for Council approved 2018 projects and bond
issue
Offsetting revenue ($132.7k) primarily from development related fees
CIP tax levy components:
Trail replacement funding ($50k): The Revolving Park Plan proposes
an increase in the tax levy for trails of $100,000 annually until 2024
when the levy is proposed at $425,000. Each year the trail
replacement funding has been cut to zero. Based on Council
feedback, we have reduced the 2019 trail replacement funding to 50k
to begin to “catch up” on the deferred trail replacement.
Equipment replacement funding ($50k): The Equipment
Replacement Plan proposes an annual tax levy increase of $50k in
2019 to get to our annual funding of $600k. As mentioned above, the
proposed increase in the equipment levy presented at the August 20
workshop was $25,000. At the September 4 CIP workshop, Council
provided staff with direction to add $25,000 to the equipment levy but
reduce General Fund net expenditures by an equal amount.
Street Overlay funding ($95k): The plan reflects four miles of street
overlay annually. We anticipate that the City will bond for the special
assessment portion of the cost and fund the remainder with
prepayments of special assessments collected from prior year(s)
improvements and an annual tax levy. The fund will be reviewed
annually, to monitor cash flow and determine the tax levy needed.
The 2019 project currently includes Pike Lake Trail from CSAH 42 to
Carriage Hills Parkway and streets in the Wilds neighborhood. A
feasibility report will be completed this fall.
Personnel: Based on Council feedback staff has adjusted the personnel
plan as follows:
Added a full-time police officer starting January 1, 2019 ($75k)
Page 5
Added a full-time city clerk starting 7/1/2019 ($60k)
Remove the budget for the City Engineer position. The responsibility
for Public Works and City Engineer (previously two positions) is now
staffed by one person. ($85k)
Severance funding ($0 2019 budget impact; $100k use of reserves)
City staff recommends the addition of 2 full-time positions as part of the FY19
budget: one police officer and one city clerk. Staff conducted an analysis of
similar sized cities in the metro area and discovered that the city of Prior
Lake is far below average in the number of FTEs. Of metro area cities
population 20,000-30,000) the average number of FTEs is 113; Prior Lake
has 19 less at 94 FTEs. Staffing levels in the city have not kept pace with
growth for years. Of all the metro area cities (population 20,000-30,000),
Prior Lake is the third most populous but has the second fewest FTEs and
has 34.5 FTEs less than average of the two most populous cities.
Staff recommends a full-time city clerk whose duties include:
City Council Support. Primary staff support for City Council
meetings, including preparing the agenda, verifying legal notices
have been posted or published and recording meeting minutes,
scheduling meetings, handling questions, correspondence and
mail.
Records Manager. Oversees the preservation and protection of
the public record and is a city’s Data Practices Responsible
Authority (required by State law).
Elections Official. Administers the procedures for all federal,
state, and local elections a responsibility which will expand
dramatically in 2019 with the addition of primaries.
Licensing. Issues licenses and some permits for cities, several of
which require significant background checks, coordination with
other state agencies, and verification of information.
Currently, the city manager is the official city clerk, but the actual duties are
scattered among departments, which is inefficient and pulls staff off their core
job functions. Prior Lake is the only city in the metro area without a full-time
city clerk.
Staff also recommends adding a police officer. Although Prior Lake has had
the highest crime rate index in Scott County for two years straight, Prior Lake
has the fewest sworn officers (27). Savage has 34 sworn officers, and
Shakopee has 50. Call volume has increased from 17,312 calls for service in
2016 to 18,323 in 2017. That is over 1,000 more calls in one year, and
overtime hours are increasing significantly. The city is on pace in 2018 to
have so much overtime that it equates to 3.5 FTEs worth of work. Due to this
high demand and low staffing every police officer is being forced to add an
additional 10-hour shift per week per officer or 52-shifts per year.
Technology Expenditures: Based on Council feedback, staff has included
the following items in the 2019 budget request:
12-year-old Phone System replacement ($5k 2019 budget impact;
75k use of reserves)
IT managed services contract: The city currently has only one IT full-
time staff person. The managed services contract would provide
cyber security and virtual helpdesk services. ($23k)
Page 6
IT network support for projects that require additional technical
resources. ($5k)
Website redesign to support ability for access and interaction with
mobile devices. ($45k use of reserves)
EDA:
The Prior Lake Economic Development Authority (EDA) proposed a tax levy
of $150,000 at their September meeting. This is a $10,000 levy increase as
compared to the prior year tax levy. The EDA plans to use the funds to start
building their reserve for future economic development initiatives that align
with their Council approved business plan. This philosophy is similar to that
adopted by the city council with respect to the equipment replacement fund.
Enterprise Funds
Included on Exhibit B are budget summaries of the three enterprise funds
that the City operates. At the workshop on July 16, Staff presented rate
increases necessary to fund operations as well as capital projects identified
in the Capital Improvements Plan. For example, in the approved
Transportation Plan, there are $3.7 million of water projects, $2.6 million of
sewer projects, and $1.5 million of water quality projects planned over the
next five years. Staff worked to balance full reconstruction projects, which
include water and sewer utility replacement, with reclamation projects that
only include street work. The goal is to reduce the annual impact on the
water & sewer funds for the full reconstruction projects. These projects are
currently proposed to be funded out of fund balance. To do this, annual rate
increases, and/or the issuance of debt is necessary. For 2019 the Council
has provided feedback to support a rate increase, vs debt issuance in the
Enterprise Funds.
FINANCIAL
IMPACT:
The following chart shows the detailed change in the property tax levy for
2019 based on the preliminary budgets presented to the Council tonight.
One of the key metrics the City Council targets during the budget process is
to “Maintain a level of property taxes on a per household basis which takes
into account the cost of inflation and community growth.”
Page 7
Our base property tax levy consideration is as follows:
Growth (New
Construction)
1.7%
CPI-U (MSP) 2.0%
Debt Service* 1.1%
Base Property Tax Levy
Considerations
4.8%
The debt service % change is already determined as the Council has approved the
2018 bond issue.
The following chart illustrates the total property tax levy on a per household
basis.
As reflected in the chart, the preliminary 2019 total tax levy/household is
slightly higher than the level which reflects the combined annual cost of
inflation and growth. Our request of 6.65% for the property tax levy change
above the 4.8% base property tax consideration is primarily for catch up on
CIP funding for trail replacement, equipment replacement and street overlay
1.41%), technology expenditures/mandatory PERA contribution for
Police/Fire (.36%), and additional funding for the EDA (.08%).
Another key metric the City Council targets is to “Maintain a level of General
Fund operational expenditures on a per household basis which considers the
cost of inflation and community growth.”
As reflected in the chart below, the preliminary 2019 operating expenditures
per household continues to be less than the level which reflects the cost of
inflation and growth.
The following chart illustrates General Fund operating expenditures on a per
household basis from 2009 to the preliminary 2019 budget:
Page 8
ISSUES:
Tax Levy Impacts
There is a preliminary estimated market value increase of 5% and a
preliminary taxable market value increase of about 6%. 1.8% of taxable
market value increase is from new construction.
Residential Impact of the City tax levy
The table below shows the estimated annual increase in the City portion of
property tax for an Average ($338,100), $600,000 and $900,000 valued
home. About 21% of city homeowners had a market value increase of .01-
5.00%. For those home owners, they would see a 3.4% increase in the city
portion of their taxes. 53% of homeowners would see a 3.4% or lower
increase in the city portion of their taxes. Owners of $600,000 and $900,000
valued homes would see 3.6% AND 3.4% respectively.
EDA:
The EDA has requested an additional $10,000 tax levy for 2019 to fund
future economic development initiatives that align with their Council approved
business plan. This is a .08% increase in the tax levy above the 6.57% levy
change discussed with the Council at the 9/4 workshop.
RESIDENTIAL IMPACTS
Net Net Net Net Net Net
of Inc/Dec Difference Inc/Dec Difference Inc/Dec Difference
Inc/Dec Total 18 vs 19 % Change 18 vs 19 % Change 18 vs 19 % Change
15.01+%1,513 17%192.97$ 17.6%391.02$ 18.9%587.73$ 17.8%
10.01-15.00%1,121 12%161.78$ 14.8%327.69$ 15.9%492.74$ 14.9%
5.01-10.00%1,594 18%99.40$ 9.1%201.04$ 9.7%302.76$ 9.2%
0.01-5.00%1,897 21%37.02$ 3.4%74.39$ 3.6%112.79$ 3.4%
No Change 21 0%5.83$ 0.5%11.06$ 0.5%17.80$ 0.5%
0.01-5.00%1,469 16%(25.36)$ -2.3%(52.26)$ -2.5%(77.19)$ -2.3%
5.01 - 10.00%808 9%(87.74)$ -8.0%(178.91)$ -8.7%(267.16)$ -8.1%
10.00 - 15.00%363 4%(150.11)$ -13.7%(305.56)$ - 14.8%(457.14)$ -13.8%
15.01% +195 2%(181.30)$ -16.6%(368.89)$ - 17.9%(552.12)$ -16.7%
8,981 100%
EMV Value Range
of
affected
Properties
AVG MV- $338, 100 $ 600, 000 HOME $900,000 HOME
Page 9
At the prior year budget workshop (August 2017), the Council indicated they
would consider providing additional annual funding to the EDA if the General
Fund reserve amount was above an established percentage (say 47%). The
funding would not be automatic but would be reviewed by the Council based
on the EDA submission of a development spending plan for council approval
and direction in the expenditure of those resources. In May of 2018, the City
Council approved a funding transfer of $300,000 from the General Fund to
the EDA.
Revolving Equipment Fund:
Funding for the Equipment Replacement Plan (ERP) has not followed the
CIP financing plan recommendations. The planned levy increases have
been reduced to meet Council directed levy targets in past years. The ERP
fund balance is not sufficient to absorb the cost of the 2019 water tanker
replacement and the recent mandate for replacement of Police radios with
encrypted radios. The long-range financial plan has been updated to
address these equipment needs as follows:
Utilize bond proceeds for the water tanker in 2019 ($325,000)
Utilize Police forfeiture funds in 2019 to cover a portion of the radio
cost. This would allow us to maintain the 2019 levy request at
600,000. The city has a Police Forfeiture Fund with a small fund
balance. There is Criminal and DWI designated cash within the
Forfeiture Fund. The use of funds is required to follow State Statute.
The ERP plan reflects funding a quarter of the radio cost from the
Police Forfeiture fund (criminal portion). This would be a qualifying
purchase. The remaining radio cost would be funded from the ERP
starting in 2020. The full cost of $220,000 has been incorporated into
the long-term ERP as the forfeiture fund is not an annual funding
source that can be relied on for purchases.
Revolving Park Equipment Fund:
To minimize the levy increase, staff has reduced the revolving park
equipment fund levy by $50,000. For the past several years, the budget for
trail maintenance has been cut from a proposed annual amount of $100,000
to zero funding. The following four trails are in need of repair; 1) Wilds
Parkway, 2) Five Hawks, 3) Fairway Heights and 4) Lakefront Park. Seeing
the trail funding need, the Council has directed staff to incorporate $50,000 in
trail replacement funding in the budget. However, the reduction in funding will
result in a delay in completing necessary sidewalk/trail repairs and may result
in temporary closure of trails.
General Fund:
Health plan premium rates for 2019 are still pending. The final proposed
2019 budget will reflect the updated premium information.
ALTERNATIVES: 1. Approve resolution adopting preliminary budgets and setting maximum
levies as set forth in the resolution.
2. Approve the resolution modified to adjust certain expenditures and the
programs they support.
3. Take no action and establish last year’s levy as this year’s maximum.
ATTACHMENTS: 1) September 17, 2018 Council Resolution – 2019 Preliminary Budget
and Tax Levy;
2) Exhibit “A” – Budget Overview
3) Exhibit “B” – Revenue and Expenditure Summaries
4646 Dakota Street SE
Prior Lake, MN 55372
RESOLUTION 18-___
A RESOLUTION ADOPTING PROPOSED 2019 CITY BUDGETS AND CERTIFYING
PRELIMINARY 2019 CITY OF PRIOR LAKE PROPERTY TAX LEVY
TO SCOTT COUNTY DEPARTMENT OF TAXATION
Motion By: Second By:
WHEREAS, State statute requires that the Prior Lake City Council certify a proposed property tax
levy to the Scott County Department of Taxation; and
WHEREAS, Preliminary budget amounts for the City of Prior Lake for calendar year 2019 are
estimated as follows; and
General Fund $ 13,633,295
Debt Service Funds 5,480,327
Cable Fund 17,805
Capital Park Fund 470,000
Revolving Equipment Fund 1,223,951
Revolving Park Equipment Fund 289,292
Permanent Improvement Revolving Fund 886,933
Facilities Management Fund 89,963
EDA 150,227
Water Fund 5,248,333
Sewer Fund 3,590,176
Water Quality Fund 1,001,628
Total $ 32,081,930
WHEREAS, The proposed property tax levy for the City of Prior Lake for payable year 2019 is as
follows; and
General Purposes $ 8,249,275
Revolving Equipment Fund 600,000
Revolving Park Equipment Fund 289,292
Permanent Improvement Revolving Fund 95,000
EDA 150,000
Debt Service 3,497,188
Total $ 12,880,755
WHEREAS, The proposed property tax levy by tax base for the City of Prior Lake for payable year
2019 is as follows; and
Tax Capacity Based Levy $ 12,646,337
Market Value Based Referenda Levy 234,418
Total $ 12,880,755
WHEREAS, The proposed City of Prior Lake property tax levy for the year payable 2019 represents
a $803,217 or 6.65% increase in total tax levy (including the Economic Development
Authority levy); and
The City Council will consider the 2019 General Fund, Debt Service Funds, Cable
Fund, Capital Park Fund, Revolving Equipment Fund, Revolving Park Equipment Fund,
Permanent Improvement Revolving Fund, Facilities Management Fund, EDA Special
Revenue Fund and Enterprise Fund Budgets and the Final 2019 Property Tax Levy
during its regularly scheduled council meeting at 7:00 p.m. on Monday December 3,
2018 at 4646 Dakota Street SE, Prior Lake with a continuation (if necessary) at 7:00
p.m. on December 17, 2018.
NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE,
MINNESOTA as follows:
1.The recitals set forth above are incorporated herein.
2.That the proposed tax levy be distributed upon the taxable property in said City for the following purposes
in payable 2019:
Note: Single starred funds shall be spread over the entire consolidated City of Prior Lake.
Note: Double starred funds represent market value-based referendum taxes and shall be spread over the
entire consolidated City of Prior Lake.
Note: All other bond issues have sufficient fund balances to cover debt requirements.
Purpose Amount Amount
General City Purposes 8,249,275
Revolving Equipment Fund 600,000
Revolving Park Equipment Fund (Park Equipment & Trail Replacement)289,292
Permanent Improvement Revolving Fund (Street Overlay)95,000
EDA 150,000
Debt Service:
F556-G.O. Imp Bonds ’09 (Brooksville Hills II)126,000
F557-G.O. Imp Bonds 2010 (CR12)114,000
F558-G.O. Imp Bonds 2011A (Boudin I/Arcadia ROW)132,000
F559-G.O. Imp Bonds 2011B (Boudins II/Arcadia)176,000
F317-G.O. CIP Refunding Bonds 2012A 642,858
F560-G.O. Imp Bonds 2013A (Welcome, CR12, Sunset)184,000
F561-G.O. Imp Bonds 2014A (Maplewood, Crest, Carriage)198,000
F562-Guaranteed Energy Savings Program 237,614
F564-G.O. Imp Bonds 2015B (150th/13)275,557
F565, 566, 567-G.O. Imp Bonds 2016A (Manitou)77,604
F566-G.O. Imp Bonds 2016A (150th/13)42,735
F567-G.O. Imp Bonds 2016A (Equipment)69,300
F568-G.O. Imp Bonds 2017A (Cates, Balsam, Franklin, Sycamore)318,644
F569-G.O. Imp Bonds 2017A (Mill and Overlay)2,099
F570-G.O. Imp Bonds 2018A (Equip, CIP, Imp, Street Recon)660,239
F571-G.O. Imp Bonds 2018A (Mill and Overlay)6,120
F318-Fire Station #2 Referendum Bonds ‘06 234,418
Total Debt Service 3,497,188
Total $ 12,880,755
WHEREAS,
PASSED AND ADOPTED THIS 17th DAY OF SEPTEMBER 2018.
VOTE Briggs McGuire Thompson Braid Burkart
Aye
Nay
Absent
Abstain
Frank Boyles, City Manager
City of Prior Lake Council Meeting 9.17.2018
2019 Proposed Budget
Budgeted Funds
Debt Capital Revolving Revolving Park Permanent Facilities Total Total
General Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
Revenues / Sources
Property Taxes
Levy - Tax Capacity 8,249,275$ 3,262,770$ -$ -$ 600,000$ 289,292$ 95,000$ -$ 150,000$ 12,646,337$ -$ -$ -$ -$ 12,646,337$
Levy - Market Value 234,418 - - - - - - 234,418 - - - - 234,418
Special Assessments - 646,901 - - - 230,089 - - 876,990 - - - - 876,990
Licenses & Permits 613,118 - - - - - - 613,118 - - - - 613,118
Fines & Forfeits - - - - - - - - - - - - -
Intergovernmental 1,782,075 - - - - - - 1,782,075 - - - - 1,782,075
Charges for Services 1,692,170 - 37,133 450,000 - - 7,820 2,187,123 4,173,152 3,821,958 978,674 8,973,784 11,160,907
Other Revenues 344,139 33,703 - 48,000 19,775 7,310 4,231 4,763 3,300 465,221 37,250 18,800 11,690 67,740 532,961
Bond Proceeds - - - - 325,000 490,000 - - 815,000 - .- 815,000
Lease Proceeds - - - - - - - - - -
Transfers From Other Funds - -
General Fund - 234,769 - - - - - 234,769 - - - - 234,769
Debt Service Funds 135,000 135,000 - 135,000
Water Fund 196,220 545,275 - - 70,000 84,000 - 895,495 - - - - 895,495
Sewer Fund 196,220 - - - 70,000 10,927 - 277,147 - - - - 277,147
Water Quality Fund 63,860 - - - 20,000 - - 83,860 - - - - 83,860
Trunk Reserve Fund - 1,900,000 1,900,000 1,900,000
TIF Fund - 29,432 - - - - - 29,432 - - - - 29,432
PIR Fund 186,933 186,933 186,933
Facilities Management Fund - - - - - - - - - - - - -
Capital Park Fund - -
Police Forfeiture Fund 57,600 57,600 57,600
Total Revenues / Sources 13,371,495$ 5,074,783$ 37,133$ 498,000$ 1,162,375$ 296,602$ 819,320$ 99,690$ 161,120$ 21,520,518$ 6,110,402$ 3,840,758$ 990,364$ 10,941,524$ 32,462,042$
Expenditures / Uses
Employee Services 9,399,120$ -$ -$ -$ -$ -$ -$ 122,027$ 9,521,147$ 727,627$ 725,805$ 287,415$ 1,740,847$ 11,261,994$
Current Expenditures 3,769,206 - 2,805 - - - 700,000 - 28,200 4,500,211 1,299,185 1,922,192 245,353 3,466,730 7,966,941
Capital Outlay 130,200 - 15,000 470,000 1,223,951 289,292 - 2,128,443 142,826 81,832 224,658 2,353,101
Capital Improvements - - - - - - 89,963 - 89,963 2,000,000 400,000 385,000 2,785,000 2,874,963
Subtotal 13,298,526$ -$ 17,805$ 470,000$ 1,223,951$ 289,292$ 700,000$ 89,963$ 150,227$ 16,239,764$ 4,169,638$ 3,129,829$ 917,768$ 8,217,235$ 24,456,999$
Transfers To Other Funds
General Fund -$ -$ -$ -$ -$ -$ -$ -$ 196,220$ 196,220$ 63,860$ 456,300$ 456,300$
Treatment Plant (Debt)- - - - - - - - 545,275 - - 545,275 545,275
Equipment Fund - - - - - - - - 70,000 70,000 20,000 160,000 160,000
Park Equipment Fund - - - - - - - - - - - - -
Debt Service Funds 234,769 135,000 - - - 186,933 - - 556,702 - - - - 556,702
PIR Fund - - -
Facilities Management Fund - - - - - - - - 84,000 10,927 - 94,927 94,927
EDA Fund - - - - - - - - - - - - -
Severance Compensation Fund 100,000 100,000 100,000
Contingency - - - - - - - - - - - - -
Debt Service 5,345,327 - - - - - 5,345,327 183,200 183,200 - 366,400 5,711,727
Subtotal 334,769$ 5,480,327$ -$ -$ -$ -$ 186,933$ -$ -$ 6,002,029$ 1,078,695$ 460,347$ 83,860$ 1,622,902$ 7,624,931$
Total Expenditures / Uses 13,633,295$ 5,480,327$ 17,805$ 470,000$ 1,223,951$ 289,292$ 886,933$ 89,963$ 150,227$ 22,241,793$ 5,248,333$ 3,590,176$ 1,001,628$ 9,840,137$ 32,081,930$
Change in Fund Balance (261,800)$ (405,544)$ 19,328$ 28,000$ (61,576)$ 7,310$ (67,613)$ 9,727$ 10,893$ (721,275)$ 862,069$ 250,582$ (11,264)$ 1,101,387$ 380,112$
1 of 2
2019 Property Tax Levy Comparison Council Meeting 9.17.2018
Change 18 - 19
Property Taxes 2018 2019 Amount Percent
Levy - Tax Capacity
General Fund - Operating 7,779,182$ 8,249,275$ 470,093$ 6.04%
Debt Service Funds 3,142,620 3,262,770 120,150 3.82%
Revolving Equipment Fund 550,000 600,000 50,000 9.09%
Revolving Park Equipment Fund 238,184 289,292 51,108 21.46%
Permanent Improvement Revolving Fund - 95,000 95,000 n/a
Facilities Management Fund - - - n/a
11,709,986$ 12,496,337$ 786,351$ 6.72%
Levy - Market Value - General Fund 227,552 234,418 6,866 3.02%
Levy - Economic Dev Authority 140,000 150,000 10,000 7.14%
Total Levy 12,077,538$ 12,880,755$ 803,217$ 6.65%
2019 Budget Expenditure Comparisons (2018 Original Budgets)
Capital Revolving Revolving Park Permanent Facilities Total Total
General Debt Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
2019 Total Expenditures / Uses 13,633,295$ 5,480,327$ 17,805$ 470,000$ 1,223,951$ 289,292$ 886,933$ 89,963$ 150,227$ 22,241,793$ 5,248,333$ 3,590,176$ 1,001,628$ 9,840,137$ 32,081,930$
2018 Total Expenditures / Uses 12,767,768$ 4,896,000$ 80,000$ 3,700$ 1,394,027$ 238,184$ 725,374$ 873,704$ 153,597$ 21,132,354$ 6,659,524$ 4,742,967$ 998,669$ 12,401,160$ 33,533,514$
Change 2018 to 2019 ($)865,527$ 584,327$ (62,195)$ 466,300$ (170,076)$ 51,108$ 161,559$ (783,741)$ (3,370)$ 1,109,439$ (1,411,191)$ (1,152,791)$ 2,959$ (2,561,023)$ (1,451,584)$
Change 2018 to 2019 (%)6.78%11.93%-77.74%n/a -12.20%21.46%n/a -89.70%-2.19%5.25%-21.19%- 24.31%0.30%-20.65%-4.33%
2019 Budget Expenditure Comparisons (2018 Amended Budgets)
Capital Revolving Revolving Park Permanent Facilities Total Total
General Debt Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
2019 Total Expenditures / Uses 13,633,295$ 5,480,327$ 17,805$ 470,000$ 1,223,951$ 289,292$ 886,933$ 89,963$ 150,227$ 22,241,793$ 5,248,333$ 3,590,176$ 1,001,628$ 9,840,137$ 32,081,930$
2018 Total Expenditures / Uses 13,267,322$ 4,896,000$ 80,000$ 3,700$ 1,394,027$ 304,184$ 725,374$ 953,665$ 153,597$ 21,777,869$ 6,660,797$ 4,772,242$ 1,295,120$ 12,728,159$ 34,506,028$
Change 2018 to 2019 ($)365,973$ 584,327$ (62,195)$ 466,300$ ( 170,076)$ (14,892)$ 161,559$ (863,702)$ (3,370)$ 463,924$ (1,412,464)$ (1,182,066)$ (293,492)$ (2,888,022)$ (2,424,098)$
Change 2018 to 2019 (%)2.76%11.93%-77.74%12602.70%-12.20%-4.90%22.27%-90.57%-2.19%2.13%-21.21%- 24.77%-22.66%-22.69%-7.03%
2 of 2
4646 Dakota Street SE
Prior Lake, MN 55372
RESOLUTION 18-153
A RESOLUTION ADOPTING PROPOSED 2019 CITY BUDGETS AND CERTIFYING
PRELIMINARY 2019 CITY OF PRIOR LAKE PROPERTY TAX LEVY
TO SCOTT COUNTY DEPARTMENT OF TAXATION
Motion By: Thompson Second By: Braid
WHEREAS, State statute requires that the Prior Lake City Council certify a proposed property tax
levy to the Scott County Department of Taxation; and
WHEREAS, Preliminary budget amounts for the City of Prior Lake for calendar year 2019 are
estimated as follows; and
General Fund $ 13,633,295
Debt Service Funds 5,480,327
Cable Fund 17,805
Capital Park Fund 470,000
Revolving Equipment Fund 1,223,951
Revolving Park Equipment Fund 289,292
Permanent Improvement Revolving Fund 886,933
Facilities Management Fund 89,963
EDA 150,227
Water Fund 5,248,333
Sewer Fund 3,590,176
Water Quality Fund 1,001,628
Total $ 32,081,930
WHEREAS, The proposed property tax levy for the City of Prior Lake for payable year 2019 is as
follows; and
General Purposes $ 8,249,275
Revolving Equipment Fund 600,000
Revolving Park Equipment Fund 289,292
Permanent Improvement Revolving Fund 95,000
EDA 150,000
Debt Service 3,497,188
Total $ 12,880,755
WHEREAS, The proposed property tax levy by tax base for the City of Prior Lake for payable year
2019 is as follows; and
Tax Capacity Based Levy $ 12,646,337
Market Value Based Referenda Levy 234,418
Total $ 12,880,755
WHEREAS,
WHEREAS,
The proposed City of Prior Lake property tax levy for the year payable 2019 represents
a $803,217 or 6.65% increase in total tax levy (including the Economic Development
Authority levy); and
The City Council will consider the 2019 General Fund, Debt Service Funds, Cable
Fund, Capital Park Fund, Revolving Equipment Fund, Revolving Park Equipment Fund,
Permanent Improvement Revolving Fund, Facilities Management Fund, EDA Special
Revenue Fund and Enterprise Fund Budgets and the Final 2019 Property Tax Levy
during its regularly scheduled council meeting at 7:00 p.m. on Monday December 3,
2018 at 4646 Dakota Street SE, Prior Lake with a continuation (if necessary) at 7:00
p.m. on December 17, 2018.
NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE,
MINNESOTA as follows:
1. The recitals set forth above are incorporated herein.
2. That the proposed tax levy be distributed upon the taxable property in said City for the following purposes
in payable 2019:
Note: Single starred funds shall be spread over the entire consolidated City of Prior Lake.
Note: Double starred funds represent market value-based referendum taxes and shall be spread over the
entire consolidated City of Prior Lake.
Note: All other bond issues have sufficient fund balances to cover debt requirements.
Purpose Amount Amount
General City Purposes 8,249,275
Revolving Equipment Fund 600,000
Revolving Park Equipment Fund (Park Equipment & Trail Replacement) 289,292
Permanent Improvement Revolving Fund (Street Overlay) 95,000
EDA 150,000
Debt Service:
F556-G.O. Imp Bonds ’09 (Brooksville Hills II) 126,000
F557-G.O. Imp Bonds 2010 (CR12) 114,000
F558-G.O. Imp Bonds 2011A (Boudin I/Arcadia ROW) 132,000
F559-G.O. Imp Bonds 2011B (Boudins II/Arcadia) 176,000
F317-G.O. CIP Refunding Bonds 2012A 642,858
F560-G.O. Imp Bonds 2013A (Welcome, CR12, Sunset) 184,000
F561-G.O. Imp Bonds 2014A (Maplewood, Crest, Carriage) 198,000
F562-Guaranteed Energy Savings Program 237,614
F564-G.O. Imp Bonds 2015B (150th/13) 275,557
F565, 566, 567-G.O. Imp Bonds 2016A (Manitou) 77,604
F566-G.O. Imp Bonds 2016A (150th/13) 42,735
F567-G.O. Imp Bonds 2016A (Equipment) 69,300
F568-G.O. Imp Bonds 2017A (Cates, Balsam, Franklin, Sycamore) 318,644
F569-G.O. Imp Bonds 2017A (Mill and Overlay) 2,099
F570-G.O. Imp Bonds 2018A (Equip, CIP, Imp, Street Recon) 660,239
F571-G.O. Imp Bonds 2018A (Mill and Overlay) 6,120
F318-Fire Station #2 Referendum Bonds ‘06 234,418
Total Debt Service 3,497,188
Total $ 12,880,755
PASSED AND ADOPTED THIS 17th DAY OF SEPTEMBER 2018.
VOTE Briggs McGuire Thompson Braid Burkart
Aye
Nay
Absent
Abstain
Frank Boyles, City Manager
City of Prior Lake Council Meeting 9.17.2018
2019 Proposed Budget
Budgeted Funds
Debt Capital Revolving Revolving Park Permanent Facilities Total Total
General Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
Revenues / Sources
Property Taxes
Levy - Tax Capacity 8,249,275$ 3,262,770$ -$ -$ 600,000$ 289,292$ 95,000$ -$ 150,000$ 12,646,337$ -$ -$ -$ -$ 12,646,337$
Levy - Market Value 234,418 - - - - - - 234,418 - - - - 234,418
Special Assessments - 646,901 - - - 230,089 - - 876,990 - - - - 876,990
Licenses & Permits 613,118 - - - - - - 613,118 - - - - 613,118
Fines & Forfeits - - - - - - - - - - - - -
Intergovernmental 1,782,075 - - - - - - 1,782,075 - - - - 1,782,075
Charges for Services 1,692,170 - 37,133 450,000 - - 7,820 2,187,123 4,173,152 3,821,958 978,674 8,973,784 11,160,907
Other Revenues 344,139 33,703 - 48,000 19,775 7,310 4,231 4,763 3,300 465,221 37,250 18,800 11,690 67,740 532,961
Bond Proceeds - - - - 325,000 490,000 - - 815,000 - .- 815,000
Lease Proceeds - - - - - - - - - -
Transfers From Other Funds - -
General Fund - 234,769 - - - - - 234,769 - - - - 234,769
Debt Service Funds 135,000 135,000 - 135,000
Water Fund 196,220 545,275 - - 70,000 84,000 - 895,495 - - - - 895,495
Sewer Fund 196,220 - - - 70,000 10,927 - 277,147 - - - - 277,147
Water Quality Fund 63,860 - - - 20,000 - - 83,860 - - - - 83,860
Trunk Reserve Fund - 1,900,000 1,900,000 1,900,000
TIF Fund - 29,432 - - - - - 29,432 - - - - 29,432
PIR Fund 186,933 186,933 186,933
Facilities Management Fund - - - - - - - - - - - - -
Capital Park Fund - -
Police Forfeiture Fund 57,600 57,600 57,600
Total Revenues / Sources 13,371,495$ 5,074,783$ 37,133$ 498,000$ 1,162,375$ 296,602$ 819,320$ 99,690$ 161,120$ 21,520,518$ 6,110,402$ 3,840,758$ 990,364$ 10,941,524$ 32,462,042$
Expenditures / Uses
Employee Services 9,399,120$ -$ -$ -$ -$ -$ -$ 122,027$ 9,521,147$ 727,627$ 725,805$ 287,415$ 1,740,847$ 11,261,994$
Current Expenditures 3,769,206 - 2,805 - - - 700,000 - 28,200 4,500,211 1,299,185 1,922,192 245,353 3,466,730 7,966,941
Capital Outlay 130,200 - 15,000 470,000 1,223,951 289,292 - 2,128,443 142,826 81,832 224,658 2,353,101
Capital Improvements - - - - - - 89,963 - 89,963 2,000,000 400,000 385,000 2,785,000 2,874,963
Subtotal 13,298,526$ -$ 17,805$ 470,000$ 1,223,951$ 289,292$ 700,000$ 89,963$ 150,227$ 16,239,764$ 4,169,638$ 3,129,829$ 917,768$ 8,217,235$ 24,456,999$
Transfers To Other Funds
General Fund -$ -$ -$ -$ -$ -$ -$ -$ 196,220$ 196,220$ 63,860$ 456,300$ 456,300$
Treatment Plant (Debt)- - - - - - - - 545,275 - - 545,275 545,275
Equipment Fund - - - - - - - - 70,000 70,000 20,000 160,000 160,000
Park Equipment Fund - - - - - - - - - - - - -
Debt Service Funds 234,769 135,000 - - - 186,933 - - 556,702 - - - - 556,702
PIR Fund - - -
Facilities Management Fund - - - - - - - - 84,000 10,927 - 94,927 94,927
EDA Fund - - - - - - - - - - - - -
Severance Compensation Fund 100,000 100,000 100,000
Contingency - - - - - - - - - - - - -
Debt Service 5,345,327 - - - - - 5,345,327 183,200 183,200 - 366,400 5,711,727
Subtotal 334,769$ 5,480,327$ -$ -$ -$ -$ 186,933$ -$ -$ 6,002,029$ 1,078,695$ 460,347$ 83,860$ 1,622,902$ 7,624,931$
Total Expenditures / Uses 13,633,295$ 5,480,327$ 17,805$ 470,000$ 1,223,951$ 289,292$ 886,933$ 89,963$ 150,227$ 22,241,793$ 5,248,333$ 3,590,176$ 1,001,628$ 9,840,137$ 32,081,930$
Change in Fund Balance (261,800)$ (405,544)$ 19,328$ 28,000$ (61,576)$ 7,310$ (67,613)$ 9,727$ 10,893$ (721,275)$ 862,069$ 250,582$ (11,264)$ 1,101,387$ 380,112$
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2019 Property Tax Levy Comparison Council Meeting 9.17.2018
Change 18 - 19
Property Taxes 2018 2019 Amount Percent
Levy - Tax Capacity
General Fund - Operating 7,779,182$ 8,249,275$ 470,093$ 6.04%
Debt Service Funds 3,142,620 3,262,770 120,150 3.82%
Revolving Equipment Fund 550,000 600,000 50,000 9.09%
Revolving Park Equipment Fund 238,184 289,292 51,108 21.46%
Permanent Improvement Revolving Fund - 95,000 95,000 n/a
Facilities Management Fund - - - n/a
11,709,986$ 12,496,337$ 786,351$ 6.72%
Levy - Market Value - General Fund 227,552 234,418 6,866 3.02%
Levy - Economic Dev Authority 140,000 150,000 10,000 7.14%
Total Levy 12,077,538$ 12,880,755$ 803,217$ 6.65%
2019 Budget Expenditure Comparisons (2018 Original Budgets)
Capital Revolving Revolving Park Permanent Facilities Total Total
General Debt Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
2019 Total Expenditures / Uses 13,633,295$ 5,480,327$ 17,805$ 470,000$ 1,223,951$ 289,292$ 886,933$ 89,963$ 150,227$ 22,241,793$ 5,248,333$ 3,590,176$ 1,001,628$ 9,840,137$ 32,081,930$
2018 Total Expenditures / Uses 12,767,768$ 4,896,000$ 80,000$ 3,700$ 1,394,027$ 238,184$ 725,374$ 873,704$ 153,597$ 21,132,354$ 6,659,524$ 4,742,967$ 998,669$ 12,401,160$ 33,533,514$
Change 2018 to 2019 ($)865,527$ 584,327$ (62,195)$ 466,300$ (170,076)$ 51,108$ 161,559$ (783,741)$ (3,370)$ 1,109,439$ (1,411,191)$ (1,152,791)$ 2,959$ (2,561,023)$ (1,451,584)$
Change 2018 to 2019 (%)6.78%11.93%-77.74%n/a -12.20%21.46%n/a -89.70%-2.19%5.25%-21.19%-24.31%0.30%-20.65%-4.33%
2019 Budget Expenditure Comparisons (2018 Amended Budgets)
Capital Revolving Revolving Park Permanent Facilities Total Total
General Debt Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
2019 Total Expenditures / Uses 13,633,295$ 5,480,327$ 17,805$ 470,000$ 1,223,951$ 289,292$ 886,933$ 89,963$ 150,227$ 22,241,793$ 5,248,333$ 3,590,176$ 1,001,628$ 9,840,137$ 32,081,930$
2018 Total Expenditures / Uses 13,267,322$ 4,896,000$ 80,000$ 3,700$ 1,394,027$ 304,184$ 725,374$ 953,665$ 153,597$ 21,777,869$ 6,660,797$ 4,772,242$ 1,295,120$ 12,728,159$ 34,506,028$
Change 2018 to 2019 ($)365,973$ 584,327$ (62,195)$ 466,300$ (170,076)$ (14,892)$ 161,559$ (863,702)$ (3,370)$ 463,924$ (1,412,464)$ (1,182,066)$ (293,492)$ (2,888,022)$ (2,424,098)$
Change 2018 to 2019 (%)2.76%11.93%-77.74%12602.70%-12.20%-4.90%22.27%-90.57%-2.19%2.13%-21.21%-24.77%-22.66%-22.69%-7.03%
2 of 2
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEFund 101 - GENERAL FUNDTaxes8,271,183 8,158,560 8,006,734 8,006,734 8,483,693476,9595.96Charges for Services1,714,605 1,944,063 1,702,315 1,702,315 1,692,170(10,145) (0.60)Intergovernmental1,581,752 1,657,988 1,675,986 1,675,986 1,782,075106,0896.33Miscellaneous Revenues260,124 348,006 312,945 312,945 344,13931,1949.97Sale of assets10,129 3,640 Transfers in362,640 430,000 443,000 443,000 456,30013,3003.00Licenses and Permits751,824 820,433 607,798 607,798 613,1185,3200.88Fines and Forfeitures4,743 2,250 TOTAL FUND 10112,957,000 13,364,940 12,748,778 12,748,778 13,371,495622,7174.88DEBT SERVICE FUNDSTaxes2,350,538 2,637,725 3,142,620 3,142,620 3,262,770 120,150 3.82 Miscellaneous Revenues942,356 1,294,524 616,846 616,846 680,604 63,758 10.34 Debt Issued1,656,085 Transfers in1,946,309 1,731,545 870,365 870,365 1,131,409 261,044 29.99 TOTAL DEBT SERVICE FUNDS6,895,288 5,663,794 4,629,831 4,629,831 5,074,783 444,952 9.61 Fund 210 - CABLE FRANCHISE FUNDCharges for Services51,050 36,815 32,000 32,000 37,133 5,133 16.04 Miscellaneous Revenues133 TOTAL FUND 21051,050 36,948 32,000 32,000 37,133 5,133 16.04 BUDGET REPORT City of Prior Lake2019 BudgetRevenuesFrom Amended Budget
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEBUDGET REPORT City of Prior Lake2019 BudgetRevenuesFrom Amended BudgetFund 225 - CAPITAL PARK FUNDCharges for Services814,100 627,808 429,000 429,000 474,000 45,000 10.49 Miscellaneous Revenues14,654 13,020 17,000 17,000 24,000 7,000 41.18 TOTAL FUND 225828,754 640,828 446,000 446,000 498,000 52,000 11.66 Fund 240 - EDA SPECIAL REVENUE FUNDTaxes139,358140,000140,000140,000150,00010,0007.14Charges for Services8,2938,5007,8207,8207,820Miscellaneous Revenues1,5232,5002,7002,7003,30060022.22Transfers in300,000(300,000) (100.00)TOTAL FUND 240149,174151,000150,520450,520161,120(289,400) (64.24)Fund 410 - REVOLVING EQUIPMENT FUNDTaxes326,039 375,905 550,000 550,000 600,000 50,000 9.09 Intergovernmental30,000 30,000 (30,000) (100.00) Miscellaneous Revenues12,037 4,387 6,000 6,000 7,775 1,775 29.58 Transfers in141,000 341,000 155,000 155,000 217,600 62,600 40.39 Debt Issued410,000 665,000 665,000 325,000 (340,000) (51.13) Other12,000 12,000 12,000 TOTAL FUND 410889,076 721,292 1,418,000 1,418,000 1,162,375 (255,625) (18.03) Fund 430 - REVOLVING PARK EQUIP FUNDTaxes214,042 238,184 238,184 289,292 51,108 21.46 Miscellaneous Revenues5,981 3,035 4,700 4,700 7,310 2,610 55.53 Transfers in85,330 TOTAL FUND 4305,981 302,407 242,884 242,884 296,602 53,718 22.12
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEBUDGET REPORT City of Prior Lake2019 BudgetRevenuesFrom Amended BudgetFund 440 - FACILITIES MANAGEMENT FUNDMiscellaneous Revenues10,024 5,146 5,400 5,400 4,763 (637) (11.80) Transfers in55,000 56,650 58,350 58,350 94,927 36,577 62.69 Debt Issued370,000 620,000 620,000 (620,000) (100.00) TOTAL FUND 44065,024 431,796 683,750 683,750 99,690 (584,060) (85.42) Fund 450 - PERMANENT IMPROVEMENT REVOLVING FUNDTaxes95,000 95,000 100.00 Miscellaneous Revenues158,364 84,852 84,852 234,320 149,468 176.15 Transfers in120,000 148,000 (148,000) (100.00) Debt Issued600,000 600,000 490,000 (110,000) (18.33) TOTAL FUND 450278,364 684,852 832,852 819,320 (13,532) (1.62) Fund 601 - WATER FUNDCharges for Services6,227,472 6,530,003 4,075,174 4,075,174 4,173,152 97,978 2.40 Intergovernmental13,333 3,270 Miscellaneous Revenues45,319 34,301 35,900 35,900 37,250 1,350 3.76 Transfers in24,871 250,000 1,500,000 1,500,000 1,900,000 400,000 26.67 Debt Issued1,180,000 1,180,000 (1,180,000) (100.00) TOTAL FUND 6016,310,995 6,817,574 6,791,074 6,791,074 6,110,402 (680,672) (10.02)
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEBUDGET REPORT City of Prior Lake2019 BudgetRevenuesFrom Amended BudgetFund 602 - STORM WATER UTILITYCharges for Services982,389 1,269,141 916,326 916,326 978,674 62,348 6.80 Intergovernmental5,407 130,000 (130,000) (100.00) Miscellaneous Revenues11,464 8,012 12,000 12,000 11,690 (310) (2.58) Transfers in42,093 TOTAL FUND 602993,853 1,324,653 928,326 1,058,326 990,364 (67,962) (6.42) Fund 604 - SEWER FUNDCharges for Services4,486,789 6,843,668 3,453,940 3,453,940 3,821,958 368,018 10.66 Intergovernmental57,280 Miscellaneous Revenues25,839 12,518 18,500 18,500 18,800 300 1.62 Transfers in92,312 Debt Issued1,400,000 1,400,000 (1,400,000) (100.00) TOTAL FUND 6044,662,220 6,856,186 4,872,440 4,872,440 3,840,758 (1,031,682) (21.17) GRAND TOTAL ALL FUNDS33,808,415 36,589,782 33,628,455 34,206,455 32,462,042 (1,744,413) (5.10) 20192019PROPOSEDPROPOSEDAMT CHANGE% CHANGE(1,166,413) (3.47) From Original Budget
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDEPARTMENTDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEFund 101 - GENERAL FUND41110.00MAYOR & COUNCIL57,181 68,444 58,196 58,196 71,866 13,670 23.49 41130.00ORDINANCE7,329 7,533 7,500 7,500 7,500 41320.00ADMINISTRATION416,490 436,766 428,305 436,970 446,273 9,303 2.13 41330.00BOARDS & COMMISSIONS10,370 11,227 10,689 10,689 11,765 1,076 10.07 41400.00CITY CLERK FUNCTIONS60,346 60,346 41410.00ELECTIONS16,982 23,984 23,984 (23,984) (100.00) 41520.00FINANCE428,727 413,278 464,052 464,052 480,315 16,263 3.50 41530.00ACCOUNTING249 41540.00INTERNAL AUDITING31,733 31,240 30,700 30,700 31,300 600 1.95 41550.00ASSESSING169,608 187,378 194,700 194,700 202,600 7,900 4.06 41610.00LEGAL147,402 217,039 212,000 212,000 200,000 (12,000) (5.66) 41820.00HUMAN RESOURCES152,007 193,253 184,443 184,443 189,241 4,798 2.60 41830.00COMMUNICATIONS106,367 114,789 124,717 124,717 173,708 48,991 39.28 41910.00COMMUNITY DEVELOPMENT323,725 336,899 326,475 326,475 348,736 22,261 6.82 41920.00INFORMATION TECHNOLOGY306,788 348,954 317,145 345,036 386,212 41,176 11.93 41940.00FACILITIES - CITY HALL436,181 480,085 461,287 461,287 472,516 11,229 2.43 42100.00POLICE3,520,535 3,742,452 4,172,825 4,172,825 4,611,812 438,987 10.52 42200.00FIRE895,149 845,670 929,460 944,460 932,488 (11,972) (1.27) 42400.00BUILDING INSPECTION583,831 608,072 593,926 593,926 616,406 22,480 3.78 42500.00EMERGENCY MANAGEMENT9,639 11,246 10,830 10,830 11,935 1,105 10.20 42700.00ANIMAL CONTROL26,000 26,400 26,448 26,448 26,448 43050.00ENGINEERING340,643 379,994 466,739 463,063 373,498 (89,565) (19.34) 43100.00STREET1,173,603 1,002,598 1,175,385 1,175,385 1,226,378 50,993 4.34 43400.00CENTRAL GARAGE361,288 416,326 421,679 421,679 459,215 37,536 8.90 45100.00RECREATION384,722 390,706 427,696 427,696 409,965 (17,731) (4.15) 45200.00PARKS1,310,572 1,237,423 1,407,937 1,411,611 1,481,048 69,437 4.92 45500.00LIBRARIES41,291 59,420 63,098 63,098 66,955 3,857 6.11 46100.00NATURAL RESOURCES149 49999.00CONTINGENT RESERVE5,616 80000.00Transfers to other Funds1,159,226 1,636,121 227,552 675,552 334,769 (340,783) (50.45) FUND TOTAL 10112,417,787 13,208,929 12,767,768 13,267,322 13,633,295 365,973 2.76 BUDGET REPORT City of Prior Lake2019 BudgetExpendituresFrom Amended Budget
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDEPARTMENTDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEBUDGET REPORT City of Prior Lake2019 BudgetExpendituresFrom Amended BudgetDEBT SERVICE FUNDS47000.00DEBT SERVICE5,047,35211,978,7184,896,0004,896,0005,345,327449,3279.1880000.00Transfers to other Funds433,529 135,000 135,000 TOTAL DEBT SERVICE FUNDS5,047,352 12,412,247 4,896,000 4,896,000 5,480,327 584,327 11.93 Fund 210 - CABLE FRANCHISE FUND41340.00PUBLIC CABLE ACCESS5,248 57,521 80,000 80,000 17,805 (62,195) (77.74) FUND TOTAL 2105,248 57,521 80,000 80,000 17,805 (62,195) (77.74) Fund 225 - CAPITAL PARK FUND45040.00PIKE LAKE PARK3,712 3,700 3,700 (3,700) (100.00) 45144.00THE ENCLAVE @ CLEARY LKPK29,678 45146.00Eagle Creek/Brooksville Hills95,847 47,511 45147.00MARKLEY LAKE TRAIL366,192 45200.00PARKS30,507 9,529 470,000 470,000 100.00 80000.00Transfers to other Funds21,052 FUND TOTAL 225496,258 107,770 3,700 3,700 470,000 466,300 12,602.70 Fund 240 - EDA SPECIAL REVENUE FUND46500.00ECONOMIC DEVELOPMENT97,162151,325145,777145,777145,8771000.0746503.00TECH VILLAGE INCUBATOR1,3359,5007,8207,8204,350(3,470) (44.37)FUND TOTAL 24098,497160,825153,597153,597150,227(3,370) (2.19)Fund 410 - REVOLVING EQUIPMENT FUND42100.00POLICE92,186 101,657 238,040 238,040 207,824 (30,216) (12.69) 42200.00FIRE441 678,770 678,770 323,575 (355,195) (52.33) 42400.00BUILDING INSPECTION59,410 59,410 43100.00STREET459,879 211,729 422,882 422,882 43400.00CENTRAL GARAGE20,044 19,999 20,000 20,000 20,000 45200.00PARKS438,643 183,807 237,003 237,003 123,741 (113,262) (47.79) 49400.00WATER10,094 10,094 66,519 56,425 559.00 49420.00WATER QUALITY210,120 210,120 (210,120) (100.00) 49450.00SEWER373,178 80000.00Transfers to other Funds148,021 FUND TOTAL 4101,159,214 890,370 1,394,027 1,394,027 1,223,951 (170,076) (12.20)
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDEPARTMENTDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEBUDGET REPORT City of Prior Lake2019 BudgetExpendituresFrom Amended BudgetFund 430 - REVOLVING PARK EQUIP FUND45200.00PARKS156,114 238,184 304,184 289,292 (14,892) (4.90) FUND TOTAL 430156,114 238,184 304,184 289,292 (14,892) (4.90) Fund 440 - FACILITIES MANAGEMENT FUND41940.00FACILITIES - CITY HALL10,690 41960.00GESP257,313 42100.00POLICE21,475 8,000 8,000 (8,000) (100.00) 42200.00FIRE9,505 843,204 843,204 67,998 (775,206) (91.94) 43100.00STREET(2,441) 45500.00LIBRARIES79,961 21,965 (57,996) (72.53) 49400.00WATER1,140 478,870 22,500 22,500 (22,500) (100.00) 80000.00Transfers to other Funds45,614 83,829 FUND TOTAL 440304,067 601,928 873,704 953,665 89,963 (863,702) (90.57) Fund 450 - PERMANENT IMPROVEMENT REVOLVING FUND43100.00STREET650,000 650,000 700,000 50,000 7.69 80000.00Transfers to other Funds75,374 75,374 186,933 111,559 148.01 FUND TOTAL 450725,374 725,374 886,933 161,559 22.27
2016201720182018201920192019ACTIVITYACTIVITYORIGINALAMENDEDPROPOSEDPROPOSEDPROPOSEDDEPARTMENTDESCRIPTIONBUDGETBUDGETBUDGETAMT CHANGE% CHANGEBUDGET REPORT City of Prior Lake2019 BudgetExpendituresFrom Amended BudgetFund 601 - WATER FUND41520.00FINANCE85,361 79,523 82,682 82,682 91,751 9,069 10.97 49400.00WATER2,408,180 2,541,927 5,731,297 5,732,570 4,261,087 (1,471,483) (25.67) 80000.00Transfers to other Funds1,742,896 2,151,421 845,545 845,545 895,498 49,950 5.91 FUND TOTAL 6014,236,437 4,772,871 6,659,524 6,660,797 5,248,333 (1,412,464) (21.21) Fund 602 - STORM WATER UTILITY49420.00WATER QUALITY598,972 633,562 921,669 1,218,120 917,768 (300,352) (24.66) 80000.00Transfers to other Funds167,768 455,215 77,000 77,000 83,860 6,860 8.91 FUND TOTAL 602766,740 1,088,777 998,669 1,295,120 1,001,628 (293,492) (22.66) Fund 604 - SEWER FUND41520.00FINANCE85,373 78,129 82,682 82,682 91,751 9,069 10.97 49450.00SEWER2,549,934 2,693,017 4,389,176 4,418,451 3,221,278 (1,197,173) (27.09) 80000.00Transfers to other Funds631,004 1,232,910 271,109 271,109 277,147 6,038 2.23 FUND TOTAL 6043,266,311 4,004,056 4,742,967 4,772,242 3,590,176 (1,182,066) (24.77) GRAND TOTAL - ALL FUNDS27,797,911 37,461,408 33,533,514 34,506,028 32,081,930 (2,424,098) (7.03) 20192019PROPOSEDPROPOSEDAMT CHANGE% CHANGE(1,451,584) (4.33) From Original Budget
1
4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL WORKSHOP REPORT
MEETING DATE: JULY 16, 2018
PREPARED BY: CATHY ERICKSON, FINANCE DIRECTOR
JASON WEDEL, PUBLIC WORKS DIRECTOR/CITY ENGINEER
PRESENTED
BY:
CATHY AND JASON
TOPIC: 2019-2023 CAPITAL IMPROVEMENT PROGRAM
DISCUSSION: Introduction
The purpose of this workshop is to complete a City Council review and receive input
regarding the proposed 2019-2023 Capital Improvement Program (CIP)
This year, the CIP Council Workshops are divided into two parts.
June 18 Workshop -Part 1: City Council review of the proposed 2019-2023 Capital
Improvement Program (CIP) for the following draft plans:
1) Transportation Plan
2) Equipment Replacement Plan
3) Park Plan
4) Facilities Management Plan
5) Street Overlay Plan
July 16 Workshop - Part 2: The remaining CIP draft plans, noted below, will be
reviewed at the July 16 Council workshop
1) Technology Plan
2) Water Operating Plan
3) Sanitary Sewer Operating Plan
4) Water Quality Operating Plan
History
Description of the Capital Improvement Plan (CIP)
Prior Lake’s five-year Capital Improvement Program is a planning tool used to support
the City’s 2040 Vision and Strategic Plan. Each year, forecasts for projects that will
be needed, estimated costs and possible funding sources are programmed into the
CIP for the next five years. The CIP is typically updated, evaluated and approved
each year by the City Council as projects are completed and priorities change. The
2
purpose of the CIP is to assure that funds are available when projects are required to
meet community needs.
Current Circumstances
1. Technology Plan
The Technology Plan assists the City with planning for current and long-range
information technology needs, including hardware, software and other IT-related
items. See the “Technology Plan – 2019-2023 Proposed Expenditures” attachment for
more specific details of proposed significant annual expenditures.
The Technology Plan itself summarizes operating and capital expenditures in
accordance with our policy. This document is also attached. The expenditures
summarized in the Technology Plan are part of the General Fund tax levy. While this
plan is reflective of the needs of our various departments the actual request could
change as part of the budget review process. This plan is discussed as part of the
CIP because have an annual investment in technology and we need to plan for our
current and long-range IT needs.
2, 3 and 4. Water, Sewer and Storm Water Plans
Utility Capital Projects
As a reminder, the Water, Sewer, and Storm Water Plans include projects associated
with the Transportation Plan. This means that fund balances are directly impacted by
the transportation plan projects where there is utility reconstruction completed below
the street. (Funds will be transferred to the Construction fund for the utility cost portion
of street projects.) A copy of the transportation plan is attached for reference.
Minimal street reconstruction with utilities in 2019:
Due to the significant road projects in 2018 and 2019, Director Wedel is
recommending one smaller scale street rehab in 2019 with no utility related work.
The only 2019 utility work will be on the CR 21/TH13/Main Ave/Arcadia road project
for an estimated total of $100,000 and $250,000 for the water and street utilities
respectively. This will give us an opportunity to build cash reserves to fund some of
the future year projects in the 2019-2023 CIP.
Utility reconstruction on private streets in 2021
The transportation plan includes utility reconstruction on the Pershing/Dunkirk area
streets in 2021. At this time the utilities under the Inguadona area private streets will
also be reconstructed. The street portion of the cost for the Inguadona area private
streets is $591,570. This cost is shared equally between the Water and Sewer Funds
at $295,785 each and is included as a use of funds in the plans.
Council has directed staff to explore the establishment of a Utility Special District for
properties served by private streets. The Utility Special District funds will be collected
from the private street properties to help offset the cost to replace the private streets
after replacement of the public utilities below the street. This process will start with
discussions with HOAs/neighborhoods with private streets to provide education on the
use of the funds and respond to resident questions/ concerns. Staff anticipates that
this item will be brought to the Council for approval in 2019. Revenue estimate per
3
year for the special billing district for private streets is $200,000. The revenue is
shared equally between the Water and Sewer Funds at $100,000 each and has been
included as a source of funds in the plans starting in 2020. Staff has also included
use of funds for future private street replacement in the water and sewer plans.
Utility Rate Study
The city plans to issue an RFP for a utility rate study to be completed in 2019. The
use of funds for the rate study will be reflected in the plans, and the cost will be split
evenly between the water, sewer and water quality plans. The last utility rate study
was done in 2004. As part of the utility rate study/plan updates, staff plans to revisit
our tiered rate structure to address appropriate charges and number of tiers for high
consumption. Currently our summer water usage is up to 3 times our winter usage
which can be attributed directly to irrigation. The existing tiered rates have had
minimal impact on irrigation usage.
Moreover, some decades ago the city implemented a program which encouraged
water users to fill their pools early in the year so that water quantity would not be
included in the water usage average which determines the bi-monthly sewer usage
calculation. This appropriateness of this policy is to come under scrutiny as well (See
Sewer Plan discussion below).
Considering the significant investment the City is putting into infrastructure to support
these uses, it would be beneficial to adjust the tiered rates to collect additional
revenue from the users who are largely responsible for these capital improvement
costs.
Utility Billing System Upgrade
The Water and Sewer Plans include a use of funds of $70,000 for an upgraded utility
billing system. Incode, our utility billing vendor is requiring an upgrade from our
current version. Staff is considering changing to our current financial system vendor,
BS&A, so all financial modules are integrated within the same financial software
system, and due to the limitations of the Incode product. Staff is proposing to do a
RFP in 2019 with a 2020 implementation date.
Water Plan:
Water Purchase and Facility Expansion Agreement with the SMSC
In November 2017, the City Council approved the Water Purchase and Facility
Expansion Agreement between the City and the SMSC. The agreement sets the
water purchase price and funds a portion of the new water treatment facility costs for
construction of filter cells used for water storage.
The water plan has been updated to reflect the water purchase rate/1000 gallons
established in the agreement.
The water plan has also been updated in 2018 and 2019 to reflect expenditures of
1.5M and $600,000 respectively to construct the filter cells the city will use at the
new SMSC south plant (funding from the Water Storage Fund) and expenditures in
2019 of $1.3M to extend the raw watermain from Well 6 to the new water treatment
plant (funding from the Trunk Oversizing Fund).
4
Utility Capital Projects:
The 2019-2023 Water Plan includes $3,711,250 in use of funds that will be
transferred to the Construction fund for the utility cost portion of street projects. This
includes about $296,000 for the Inguadona area private street replacement. The
contributions from the Water Utility Fund for transportation/ street projects varies by
year, based on the projects. The five-year (2019-2023) contribution average is about
742,000.
AMRS Project:
The budget for the annual cost of meter replacements has been reduced by $70,000,
as the city will replace approximately 6,000 meters as part of the Meter/Automated
Meter Reading System replacement project approved by the Council in June.
2019 Water Rates:
For 2019, staff recommends a minimal rate increase of 3% for the Water Plan to
cover estimated increases in operating and maintenance costs. For 2020 forward,
the rate structure will be based on the updated plans from our consultants.
Sewer Plan:
2018 Sanitary Sewer Rates:
Utility Capital Projects:
The 2019-2023 Sanitary Sewer Plan includes $2,593,905 in use of funds that will be
transferred to the Construction fund for the sanitary sewer utility cost portion of street
projects. This includes about $296,000 for the Inguadona area private street
replacement. The contributions from the Sewer Utility Fund for transportation/ street
projects varies by year, based on the projects. The five-year (2019-2023) contribution
average is about $519,000.
Concrete Sewer Lining Replacement:
We anticipate that there will be a use of funds for future concrete sewer lining
replacement. Over the ten-year period beginning in 2022, we have included costs of
1.9M.
Staff has been evaluating the impact of billed sewer flows on revenues and the
increase in capital project expenditures on the sewer fund reserves.
Summer Sewer Lock/Cost Break:
We bill sewer based on water consumption, however, we provide a summer sewer
lock. Residents pay the average of the Feb and April consumption for the June,
August, October and December billing cycle. The billing cycles cover the following
time periods highlighted in blue:
Month Billing Cycle
Feb Nov 21 - Jan 20
Apr Jan 21 - March 20
June March 21 - May 20
Aug May 21- July 20
Oct July 21-Sept 20
Dec Sept 21- Nov 20
5
The summer sewer lock is intended to give consideration to pool filling, lawn and
garden sprinkling, etc. that do not flow into the sanitary sewer system. The summer
sewer lock was established years ago. This is reducing our annual billed sewer
consumption.
Our 2017 billed sewer consumption was about 529.3M gallons. Our MCES actual
flow was 612.2M gallons. The unbilled consumption is the due to the summer sewer
consumption lock and inflow & infiltration(I&I). I&I is the storm water and ground
water that comes from other sources than water consumption, such as wet weather
and enters the sanitary sewer through leaking sanitary sewer pipes and manholes. If
the city billed sewer based on actual water consumption, without the summer sewer
lock, we could generate the revenue needed to cover the actual MCES flow. The
additional revenue that could be generated for this unbilled flow was about $460,000
based on 2017 rates (MCES of $220,000 and City Sewer of $240,000).
Billing for sewer based on actual water consumption could have the added benefit of
encouraging water conservation.
Many cities provide a summer sewer lock to some level, but ours is more generous
than some. However, staff would like the Council to consider phasing this out. If this
is something that the Council is receptive to, staff will provide additional analysis and
phase out options.
Sewer Fund Balance:
Based on the current plans it is likely that the fund balance will drop below the
recommended amount in 2019.
Staff has identified several options the Council can consider to maintain an
appropriate fund balance in the Sewer Fund:
1. Increase the City portion of the sewer rate.
2. Consider modifying or phasing out the summer sewer lock.
3. Issue debt to fund at least a portion of the 2020/2021 $2.2M capital needs.
4. Consider postponing one or more projects to a future year.
5. Consider a combination of the above.
If no change is made to the current billing structure, Staff recommends an increase in
the City portion of the rate of $.60 and $.50 in 2019 and 2020 respectively. The
current city portion of the sewer rate is $2.94/1,000 gallons. If the average household
uses 8,000 gallons of water per month the proposed $0.60 increase would equate to
an additional $4.80 per month.
Staff would prefer to finance the sewer fund portion of the transportation projects on a
paygo basis instead of issuing debt. In 2018, we knew we had planned bonding for
the one-time AMRS replacement project, so a one-time financing of the utility portion
of a transportation project in conjunction with the bonding was a reasonable
approach. Staff would prefer not to issue debt annual to finance sewer fund capital
projects.
6
The only sewer cost in 2019 is related to the CR21 project and that cannot be
delayed. The biggest portion of the proposed sewer cost in 2020 is for Fish Point
Road. That street is in very poor condition and would be difficult to delay. In 2021 we
are proposing to complete projects in the Pershing/Green Heights neighborhood,
including the private streets such as Inguadona. This will require significant funding
from the sewer fund. In 2022 we are proposing mostly full depth reclamation projects
to help ease the strain on the sewer fund. Based on this transportation plan there are
not a lot of opportunities to reduce the burden on the sewer fund in the near term.
For 2021 forward, the rate structure will be based on the updated utility rate study,
and Council consideration of the options outlined above
MCES impact on the Sewer Fund:
The Metropolitan Council Environmental Services (MCES) annual operating budget
plans for the resources necessary to support its two core functions: wastewater
collection and treatment and water resource planning. Based on the MCES budget
workshop information presented in May, the proposed 2019 cost increase is 7.25%.
The MCES sets the rates based on the actual flow from 2017 (two years prior
historical). The cost increase is comprised of two components as follows:
1) A volume increase of 2.8% based on the change in metered flow from 2016 to
2017.
2) A rate increase of 4.4%. The MCES total regional wastewater charge is up
3.5%. The total regional flow is down -.083%, but the cost is still spread over
the same users. The City of Prior Lake’s proportionate share results in a 4.4%
rate increase. The Sewer plan currently reflects a 7.5% increase in the
MCES cost, which will be adjusted if there is a change in the final information
that is received from the MCES in early August.
Storm Water Plan:
The Storm Water Plan includes pond maintenance and retrofit projects.
Utility Capital Projects:
The 2019-2023 Storm water plan includes $1,545,565 in use of funds that will be
transferred to the Construction fund for the storm water utility cost portion of street
projects. Staff is seeing an increase in annual stormwater infrastructure costs due to
increased regulation and requirements. A recent example is the cost for the Rolling
Oaks stormwater infrastructure which included land acquisition costs for the
construction of a filtration basin as well as SAFL Baffle inserts for all of the catch
basins. The SAFL Baffle is a stormwater pretreatment system that removes sediment
and chemicals. The SAFL Baffles alone were $36,540.
2019 Storm Water Rates:
For 2019, staff recommends a rate increase of 5% for the Storm Water Plan due to
the increase in stormwater project costs that we are experiencing. The cost for the
Huron area streets stormwater work is estimated at $348,000. With this project, the
city earns credit toward future stormwater project costs. As this credit is earned, staff
will adjust the stormwater plan costs accordingly, which may result in a reduction in
future use of funds. For 2020 forward, the rate structure will be based on the updated
rate study.
7
ISSUES:
Conclusion
Once the City Council has completed the review of the CIP plans, and provided
direction on project priorities by plan, staff will make any revisions before the public
presentation.
Council direction is specifically needed on the following items:
Proposed rate increases for the utility plans. The water and storm water
recommended rate increases are minimal, but the city sewer rate increase is
proposed at $.60 and $.50 for 2019 and 2020 respectively. If the sewer rate
lock is phased out, the proposed rate increases could be reduced.
Any projects Council is hesitant about proceeding with that are programmed in
the CIP.
Any technology plan proposed upgrades or purchases for 2019.
Whether the CIP tax levy impact proposed for 2019 is acceptable.
A public presentation for the CIP is scheduled at the Council meeting on Monday,
August 6
FINANCIAL
IMPACT:
In reviewing the 2019-2023 Capital Improvement Program, the City Council should
consider the annual tax impact of the scheduled projects.
CIP Bonding:
The 2019-2023 CIP includes projects that are funded by bond proceeds. Bonds are
issued for the project costs that the City is funding through tax levies as well as the
costs that are specially assessed to property owners.
The 2019-2023 CIP anticipates the following bonding needs:
Transportation Plan projects for 2019-2023 of $14,403,000.
Bonding for the following major facility repairs, equipment replacements and
water/sewer plan capital projects by year:
Year Major Facility
Repairs
Equipment
Replacements
2019 - 325,000
2020 - -
2021 600,000 725,000
2022 - -
2023 - -
The equipment replacements are a Fire water tanker and pumper in 2019 and 2021
respectively.
The major facility expenditures are for City Hall and Police Station HVAC/carpet/ wall
coverings, and the Maintenance Center front parking lot and crane.
Summary of Projected Debt Balances
8
The chart below reflects the cumulative effect of proposed new debt issued and the
retirement of existing debt. The green line is the resulting total debt balance at the
end of the year.
Bond Repayment through Debt Service Tax Levy:
The impact of the 2019-2023 CIP and other anticipated bond payment adjustments on
the debt service property tax levy are reflected in the following tables.
Projected five-year annual change in debt levy:
The table below indicates that we are adding more CIP debt annually than the
existing debt that is falling off. In 2018 we bonded for the following projects, which
resulted in an estimated annual net debt levy average of $541,000.
Fire Pumper Replacement
Fire Station #2 SCBA and Parking Lot Replacement
2018 Street Improvement Projects
o Franklin Area
o Huron Area
2018 Street Reconstruction Projects
o Duluth Ave/TH 13
o County Wide Flashing Yellow Signal Conversion
9
Projected change in total CIP Tax Levy:
The funds/plans that have a CIP tax levy are shown below. The table below shows
the projected change in the CIP tax levy by component. For 2019, the estimated
increase in the tax levy for all CIP components for 2019 is 3.1%
Option to use Revolving Park Equipment Fund Reserves:
Upon further review of the Revolving Park Equipment Fund, staff is projecting
adequate fund balance to cover one mile ($100,000 cost) of trail replacement in 2019.
Based on this, Council could consider funding one mile of trail replacement in 2019
with Revolving Park Equipment Fund reserve. This will allow us to begin the annual
process of trail replacement without impacting the tax levy in 2019. The Revolving
Park Plan proposes an increase in the tax levy for trails, etc. of $100,000 annually
until 2024 when the levy is proposed at $425,000. By using fund reserves, we are not
building the trail replacement program as planned, and will not be able to sustain our
trail replacement.
The table below summarized the annual projected total CIP tax levy by component.
2019 2020 2021 2022 2023
Debt:
Existing CIP (425,209) ( 162,795) 12,313 (24,001) (223,176)
New CIP 545,639 242,296 319,059 359,849 396,308
Market Referendum 6,866 7,000 11,720 1,150 10,770
Change in Debt Levy 127,296 86,501 343,092 336,998 183,903
2019-2023 CIP Projected Change in Debt Levy
Tax Levies:2019 2020 2021 2022 2023
Equipment Revolving Fund 50,000 - - - -
Revolving Park Equip Fund 101,108 93,984 94,373 105,183 271,081
Facilities Management Fund - 30,000 50,000 - 25,000
PIR Fund 95,000 80,000 - 10,000 -
Debt Service 127,296 86,501 343,092 336,998 183,903
Total CIP Tax Levies 373,404 290,485 487,465 452,181 479,984
0.031
2019-2023 CIP Projected Change in CIP Tax Levy
2019 - Estimated % Increase in Tax Levy for
CIP components only
Tax Levies:2019 2020 2021 2022 2023
Equipment Revolving Fund 600,000 600,000 600,000 600,000 600,000
Revolving Park Equip Fund 339, 292 433,276 527, 649 632,832 903, 913
Facilities Management Fund - 30,000 80,000 80,000 105, 000
PIR Fund 95,000 175,000 175,000 185,000 185,000
Debt Service 3,497,468 3,583,968 3,927,061 4,264,059 4,447,962
Total CIP Tax Levies 4,531, 760 4,822, 244 5,309, 710 5,761,891 6,241,875
2019-2023 CIP Projected CIP Tax Levy
10
The projected debt service shown above is based on the 2018A bond issue financing
plan. Staff will update the debt service based on the July 16 finalized 2018A bond
issue results. The updated information will be presented at the CIP Public Hearing.
This project debt service levy estimate for years 2019-2023 is based on ten-year level
annual debt service payments.
Bond Repayment Debt Service supported by Water and Sewer Fund Revenues:
Revenues of the Water and Sewer Funds support the annual debt service for the
Water Treatment Plant debt refunding bond issues, the AMRS replacement, and the
Huron area street improvements. Utility Fund projected annual debt service is shown
below:
Based on Council direction, updated financial information related to the impact of the
proposed CIP on debt levels, fund balance reserves and average utility customer will
be distributed as part of the public presentation on the CIP at the Monday, August 6
Council meeting.
Approval of the CIP does not obligate the City to complete the proposed projects or
purchases. The 2019 projects/proposed purchases will be incorporated into the 2019
budget requests for budgeted funds. Further Council approvals may be necessary to
comply with state statutes and the city’s purchasing policy.
RECOMMENDED
ACTION:
The Council should provide comments on the elements of the plan in order that the
CIP process can proceed as planned.
Attached are the following documents for Council review and discussion at the
workshop:
2019-2023 CIP Plan select pages:
1) Technology Plan – 2019-2023 Proposed Expenditures
2) Technology Plan
3) Water Operating Plan
4) Sanitary Sewer Operating Plan
5) Water Quality Operating Plan
http://splash/teams/am/October 4 2010/07 16 2018/2019-2038 Technology Plan Budget Justification.docx
Plan Technology Plan – 2019-2023 Proposed Expenditures
General Fund
Computer Replacement
includes work station, lap tops,
tough books, iPads, etc.)
2019: $ 26,520
2020: $20,285
2021: $19,670
2022: $25,917
City computers are on a six-year replacement schedule and laptops/tough
books on a five-year replacement schedule.
Website Redesign 2019: $45,000
2020: $8,000 (annual license fee)
2021: $8,000
2022: $8,000
Redesign of city website. An external audit of city’s network security
indicated that the platform on which the city’s website resides is a
security risk for hackers because the programming is outdated and no
longer supported. New website would include email sign up on specific
topics and capability to send alerts. Updated website would allow for live
stream of Council meetings, which current system cannot support.
Phone System Replacement 2019: $70,000 Current city phone system is over 12+ years old and failing. The new
phone system combines 7 buildings’ phone systems into one.
Managed Services Contract
virtual Helpdesk)
2019: $23,000 This contract would provide virtual Helpdesk support. Rather than hire
additional FTEs at this time to support our IT Department, this contract
would provide Helpdesk support as well as regular monitoring of our
network to prevent ransomware, hackers and other security threats.
recurring annual cost moving forward)
Copiers 2021: $18,731 (large map)
2022: $8,500 (Public Works)
2023: $10,000 (Police)
Copier replacements.
Servers 2020 - $8,758
2021 - $8,845
Replacement/upgrade of physical servers that run all city virtual servers.
Epson Projector 2020 - $5,667 Replacement of Parkview Conference Room projector.
http://splash/teams/am/October 4 2010/07 16 2018/2019-2038 Technology Plan Budget Justification.docx
NIMBLE SANS Controller 2019 - $16,000 Upgrade the interface to the City’s network on the storage controller unit
for virtual servers.
Citizens Online Portal 2019 - $15,914
Split between general/water/sewer funds)
Online service request module for public works complaints.
Water Fund
BS&A Utility Billing System 2019 - $17,552
2020 - $17,552
Switch from Incode to BS&A for water meter reading replacement
project.
Sewer Fund
BS&A Utility Billing System 2019 - $17,552
2020 - $17,552
Switch from Incode to BS&A for water meter reading replacement
project.
Cable Fund
Tightrope Channel 2022 - $7,727 Replacement of playback system on cable channel. Part of three-year
Council Chamber audio/visual enhancement project.
Audio System for Chambers 2019 - $15,000 Part of three-year Council Chamber audio/visual enhancement project.
DRAFT 07/16/2018
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Use of Funds:
Hardware
Administration 7,534$ 10,976$ 7,393$ 6,997$ 6,168$ 10,468$ 8,465$ 10,578$ 7,541$ 7,120$
Building Inspection/Engineering 3,570 1,133 - - 6,263 2,984 3,790 1,203 - -
Community/Economic Development 2,150 6,800 1,041 2,102 1,168 1,179 - 7,218 1,105 1,116
Finance 1,122 2,576 - 3,363 1,000 2,573 1,191 2,734 - 3,570
Fire - 8,655 - - - - - - - -
Police 16,934 2,885 8,949 10,993 6,062 14,903 21,007 8,312 5,413 8,880
Public Works 7,161 3,503 7,284 7,462 5,095 6,218 7,905 3,719 5,744 7,921
Cable Television 17,805 18,958 - 7,883 - 37,413 - 2,734 4,584 77,323
Printers/Scanners 3,162 3,946 22,576 24,504 21,316 15,975 1,083 7,929 3,424 6,694
Network Infrastructure 19,117 22,258 30,867 14,322 14,752 68,801 15,650 25,416 25,993 17,101
Miscellaneous 250 6,697 3,642 1,997 - - - - - -
Total Hardware 78,805$ 88,385$ 81,752$ 79,623$ 61,824$ 160,514$ 59,092$ 69,843$ 53,803$ 129,724$
Software
Existing / Maintenance / Upgrades 169,958$ 173,217$ 138,278$ 139,591$ 143,760$ 148,055$ 152,479$ 157,035$ 166,558$ 166,562$
Proposed Software 175,314 9,500 9,500 9,500 - - - - - -
Total Software 345,272$ 182,717$ 147,778$ 149,091$ 143,760$ 148,055$ 152,479$ 157,035$ 166,558$ 166,562$
Total Use of Funds 424,077$ 271,102$ 229,531$ 228,713$ 205,585$ 308,570$ 211,570$ 226,879$ 220,361$ 296,286$
Source of Funds:
General Fund 295,847$ 148,835$ 163,031$ 143,115$ 134,687$ 197,107$ 134,502$ 143,428$ 138,097$ 133,680$
Water Fund 54,804 52,897 33,980 35,914 34,063 36,800 39,873 41,651 38,594 39,488
Sewer Fund 53,682 50,013 32,107 41,379 35,230 36,800 36,733 38,588 38,594 45,289
Water Quality Fund 1,938 400 412 424 1,604 450 463 477 492 506
Cable Franchise Fund 17,805 18,958 - 7,883 - 37,413 - 2,734 4,584 77,323
Total Source of Funds 424,077$ 271,102$ 229,531$ 228,713$ 205,585$ 308,570$ 211,570$ 226,879$ 220,361$ 296,286$
Net Source (Use) of Funds -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Operating Budget 216,864$ 204,346$ 187,252$ 203,327$ 184,268$ 214,054$ 211,570$ 217,582$ 210,972$ 212,270$
Capital Improvement Plan 207,213$ 66,756$ 42,279$ 25,386$ 21,316$ 94,515$ -$ 9,296$ 9,389$ 84,017$
Source of Funds (Operating Budget):
General Fund 149,348$ 124,911$ 120,752$ 123,414$ 113,371$ 131,063$ 134,502$ 134,132$ 128,708$ 126,986$
Water Fund 31,947 35,345 33,980 33,071 34,063 35,728 39,873 41,651 38,594 39,488
Sewer Fund 30,825 32,460 32,107 38,536 35,230 35,728 36,733 38,588 38,594 45,289
Water Quality Fund 1,938 400 412 424 1,604 450 463 477 492 506
Cable Franchise Fund 2,805 11,230 - 7,883 - 11,086 - 2,734 4,584 -
Total Source of Funds: Op. Budget 216,864$ 204,346$ 187,252$ 203,327$ 184,268$ 214,054$ 211,570$ 217,582$ 210,972$ 212,270$
Source of Funds (CIP):
General Fund 146,499$ 23,924$ 42,279$ 19,700$ 21,316$ 66,044$ -$ 9,296$ 9,389$ 6,694$
Water Fund 22,857 17,553 - 2,843 - 1,072 - - - -
Sewer Fund 22,857 17,553 - 2,843 - 1,072 - - - -
Water Quality Fund - - - - - - - - - -
Cable Franchise Fund 15,000 7,727 - - - 26,327 - - - 77,323
Total Source of Funds: CIP 207,213$ 66,756$ 42,279$ 25,386$ 21,316$ 94,515$ -$ 18,686$ 9,389$ 644,185$
CITY OF PRIOR LAKE
2019 - 2028 TECHNOLOGY PLAN
CITY OF PRIOR LAKE Draft 7/16/2018
2019 - 2028 WATER OPERATING PLAN
2019-2028
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Totals
Use of Funds:
Operations & Maintenance 2,028,101$ 2,129,506$ 2,235,981$ 2,347,780$ 2,465,169$ 2,588,428$ 2,717,849$ 2,853,742$ 2,996,429$ 3,146,250$ 25,509,236
Capital Projects 2,132,130 1,323,743 2,473,325$ 650,088$ 805,387$ 2,090,924$ 1,055,477$ 1,059,392$ 1,063,423$ 1,067,576$ 13,721,467
Interfund Transfer 350,220 358,630 372,286$ 381,209$ 395,393$ 404,859$ 414,600$ 424,639$ 434,979$ 445,631$ 3,982,446
Debt Service 698,369 707,173 725,762$ 736,630$ 763,950$ 770,985$ 786,617$ 784,292$ 790,958$ 797,875$ 7,562,611
Total Use of Funds 5,208,820 4,519,052 5,807,355 4,115,707 4,429,899 5,855,196 4,974,544 5,122,065 5,285,789 5,457,332 50,775,760
Source of Funds:
Water Usage Charge 4,071,504 4,237,529 4,409,881 4,588,792 4,774,504 4,967,268 5,025,398 5,083,527 5,286,874 5,497,898 47,943,173
Special Utility Billing District 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 900,000
Other Revenues 115,000 117,300 119,646 122,039 124,480 126,969 129,509 132,099 134,741 137,436 1,259,218
Bond Proceeds - - - - - - - - - - 0
Trunk Fund Contribution 1,900,000 - - - - - - - - - 1,900,000
Total Source of Funds 6,086,504 4,454,829 4,629,527 4,810,831 4,998,984 5,194,238 5,254,906 5,315,626 5,521,615 5,735,333 49,202,391
Change in Fund Balance 877,684$ (64,223)$ (1,177,828)$ 695,123$ 569,085$ (660,959)$ 280,362$ 193,561$ 235,826$ 278,001$ (1,573,368)$
Beginning Fund Balance 3,557,191$ 4,434,874$ 4,370,651$ 3,192,823$ 3,887,946$ 4,457,031$ 3,796,072$ 4,076,434$ 4,269,995$ 4,505,821$ 4,783,822$
Ending Fund Balance 4,434,874$ 4,370,651$ 3,192,823$ 3,887,946$ 4,457,031$ 3,796,072$ 4,076,434$ 4,269,995$ 4,505,821$ 4,783,822$ 3,210,454$
CITY OF PRIOR LAKE Draft 7/16/2018
2019 - 2028 SANITARY SEWER OPERATING PLAN
2019-2028
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Totals
Use of Funds:
Operations & Maintenance 1,065,866$ 1,097,842$ 1,130,777$ 1,164,701$ 1,199,642$ 1,235,631$ 1,272,700$ 1,310,881$ 1,350,207$ 1,390,713$ 12,218,959
MCES Fees 1,591,810 1,692,094 1,798,426 1,911,162 2,030,675 2,157,362 2,291,641 2,433,954 2,584,769 2,744,581 21,236,473
Capital Improvement Projects 487,136 722,660 1,437,794 638,032 1,014,173 1,024,480 1,055,861 1,088,536 1,121,443 1,154,586 9,744,701
Interfund Transfer 277,147 283,365 294,763 301,361 313,149 320,148 327,348 334,769 342,412 350,288 3,144,749
Debt Service 152,383 153,123 155,243 157,180 153,930 155,550 156,905 152,985 153,925 154,575 1,545,798
Total Use of Funds 3,574,343 3,949,083 4,817,003 4,172,435 4,711,569 4,893,171 5,104,454 5,321,125 5,552,756 5,794,743 47,890,680
Source of Funds:
Wastewater Collection Revenue 3,825,279 4,233,878 4,417,394 4,609,349 4,810,171 5,020,309 5,240,236 5,470,450 5,656,072 5,850,691 49,133,831
Special Utility Billing District 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 900,000
Other Revenues 15,300 15,606 15,918 16,236 16,561 16,892 17,230 17,575 17,926 18,285 167,531
Bond Proceeds - - - - - - - - - - -
Total Source of Funds 3,840,579 4,349,484 4,533,312 4,725,586 4,926,733 5,137,202 5,357,466 5,588,025 5,773,999 5,968,976 50,201,361
Change in Fund Balance 266,237$ 400,401$ ( 283,691)$ 553,151$ 215,164$ 244,031$ 253,013$ 266,900$ 221,243$ 174,233$ 2,310,681$
Beginning Fund Balance 1,413,219$ 1,679,456$ 2,079,856$ 1,796,165$ 2,349,316$ 2,564,480$ 2,808,511$ 3,061,524$ 3,328,424$ 3,549,666$
Ending Fund Balance 1,679,456$ 2,079,856$ 1,796,165$ 2,349,316$ 2,564,480$ 2,808,511$ 3,061,524$ 3,328,424$ 3,549,666$ 3,723,900$
CITY OF PRIOR LAKE Draft 7/16/2018
2019- 2028
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Totals
Use of Funds:
Operations & Maintenance 631, 581$ 511,707$ 524, 207$ 537, 072$ 560, 313$ 563,942$ 577,972$ 592,415$ 607,281$ 622,586$ 5,729,078$
Capital Projects 385, 000 499,835 740, 250 319, 760 855, 720 431,152 706,152 706,152 706,152 706,152 6,056,325
Total Use of Funds 1,016, 581 1,011,543 1,264, 457 856, 832 1,416, 033 995,094 1,284,124 1,298,567 1,313,433 1,328,738 11,785,403
Source of Funds:
Interest Earnings (1.5%)11,688$ 6,243$ 5,915$ 6,324$ 4,356$ 8,322$ 6,160$ 9,541$ 9,519$ 9,759$ 77,827$
Charges for Services 978, 675 1,038,056 1,101, 040 1,167, 846 1,238, 705 1,257, 285 1,276,145 1,308,240 1,341,142 1,374,871 12,082,004
Grants - - - - - - - - - - -
Total Source of Funds 990, 363 1,044,299 1,106, 955 1,174, 170 1,243, 060 1,265, 607 1,282,305 1,317,782 1,350,663 1,384,633 12,159,837$
Change in Fund Balance (26,218)$ 32,756$ (157, 502)$ 317, 338$ ( 172, 973)$ 270,514$ (1,820)$ 19,215$ 37,229$ 55,896$ 374,434$
Beginning Fund Balance 499, 406$ 473,188$ 505, 943$ 348, 441$ 665, 779$ 492,806$ 763,319$ 761,499$ 780,713$ 817,941$
Ending Fund Balance 473, 188$ 505,943$ 348, 441$ 665, 779$ 492, 806$ 763,319$ 761,499$ 780,713$ 817,941$ 873,833$
2019 - 2028 WATER QUALITY OPERATING PLAN
Page 1
City of Prior Lake, Minnesota
8,745,000
General Obligation Bonds, Series 2018A
Bond Sale Summary
July 16, 2018
PURPOSE: Proceeds from the Bonds will be used to purchase equipment; to finance a capital
improvement plan project, an improvement project, a permanent improvement revolving
fund project, a water project, a sewer project, a street reconstruction project and to
finance the costs associated with the issuance of the Bonds.
FINANCE PLAN: The Capital Improvement Plan Portion, the Improvement Portion, the Water Portion, the
Sewer Portion and the Street Reconstruction Portion of the Bonds have been structured
over 10 years, with relatively level annual debt service payments. The Equipment
Portion has been structured over nine years, with relatively level annual debt service
payments. The PIR Fund Portion has been structured over five years with relatively level
annual debt service payments.
RESULTS:
The City received seven bids.
Bonds were purchased by Piper Jaffray, Minneapolis, Minnesota.
Bonds were rated AA+ by S&P.
Final
on
07/ 16/2018
Finance
Plan
06/ 18/2018
Par Amount $8,270,000* $8,745,000
Average Interest Rate 4.61% 2.79%
All Inclusive Cost (AIC) 2.56% 3.07%
True Interest Cost (TIC) 2.41% 2.93%
Final par amount was reduced by the reoffering premium and rounding on the Equipment, CIP
and Improvement portions of the Bonds.
Page 2
EXHIBIT A – SOURCES AND USES
Equipment CIP Improvement PIR Fund Water Sewer
Street
Reconstruction
Issue
Summary
Sources Of Funds
Par Amount of Bonds $605,000.00 $560,000.00 $2,655,000.00 $490,000.00 $ 1,320,000.00 $1,320,000.00 $ 1,320,000.00 $8,270,000.00
Reoffering Premium 69,561.85 69,643.00 330,934.70 34,493.30 167,617.50 167,617.50 167,617.50 1,007,485.35
Total Sources $674,561.85 $629,643.00 $2,985,934.70 $524,493.30 $ 1,487,617.50 $1,487,617.50 $ 1,487,617.50 $9,277,485.35
Uses Of Funds
Deposit to Project Construction Fund 665,000.00 620,000.00 2,940,000.00 485,000.00 1,300,000.00 1,300,000.00 1,300,000.00 8,610,000.00
Deposit to Project Construction Fund (Premium)---31,238. 72 165,380.69 165,380.69 165, 380.69 527, 380.79
Costs of Issuance 5,353.52 4,955.36 23,493.71 4,335.94 11,680.49 11,680.49 11,680.49 73,180.00
Total Underwriter's Discount (0.459%)2,775.27 2,568.84 12,179.06 2,247.74 6,055.12 6,055.12 6,055.12 37,936.27
Deposit to Construction Fund (Unused Discount)2,063.05 1,909.60 9,053.55 1,670.90 4,501.20 4,501.20 4,501.20 28,200.70
Rounding Amount (629.99)209.20 1,208.38 ----787.59
Total Uses $674,561.85 $629,643.00 $2,985,934.70 $524,493.30 $ 1,487,617.50 $1,487,617.50 $ 1,487,617.50 $9,277,485.35
EXHIBIT B – PRICING SUMMARY
Maturity Type of Bond Coupon Yield
Maturity
Value Price YTM Call Date Call Price Dollar Price
12/15/2019 Serial Coupon 4.000%1.550% 760,000.00 103.219% ---784,464.40
12/15/2020 Serial Coupon 4.000%1.700% 860,000.00 105.237% ---905,038.20
12/15/2021 Serial Coupon 4.000%1.800% 805,000.00 107.084% ---862,026.20
12/15/2022 Serial Coupon 4.000%1.900% 835,000.00 108.693% ---907,586.55
12/15/2023 Serial Coupon 4.000%2.000% 870,000.00 110.067% ---957,582.90
12/15/2024 Serial Coupon 4.000%2.150% 790,000.00 110.897% ---876,086.30
12/15/2025 Serial Coupon 5.000%2.270% 805,000.00 118.343% ---952,661.15
12/15/2026 Serial Coupon 5.000%2.380% 830,000.00 119.695% ---993,468.50
12/15/2027 Serial Coupon 5.000%2.450% 870,000.00 119.112%c 2.672%12/15/2026 100.000%1,036,274.40
12/15/2028 Serial Coupon 5.000%2.510% 845,000.00 118.615%c 2.902%12/15/2026 100.000%1,002,296.75
Total ---$8,270,000.00 -----$9,277,485.35
Bid Information
Par Amount of Bonds $8,270,000.00
Reoffering Premium or (Discount)1,007,485.35
Gross Production $9,277,485.35
Total Underwriter's Discount (0.459%)$(37,936.27)
Bid (111.724%)9,239,549.08
Total Purchase Price $9,239,549.08
Bond Year Dollars $48,636.67
Average Life 5.881 Years
Average Coupon 4.6100679%
Net Interest Cost (NIC)2.6166149%
True Interest Cost (TIC)2.4108861%
Page 3
EXHIBIT C – DEBT SERVICE SCHEDULE
Date Principal Coupon Interest Total P+I Fiscal Total
08/15/2018 -----
06/15/2019 --303,583.34 303,583.34 -
12/15/2019 760,000.00 4.000%182,150.00 942,150.00 1,245,733.34
06/15/2020 --166,950.00 166,950.00 -
12/15/2020 860,000.00 4.000%166,950.00 1,026,950.00 1,193,900.00
06/15/2021 --149,750.00 149,750.00 -
12/15/2021 805,000.00 4.000%149,750.00 954,750.00 1,104,500.00
06/15/2022 --133,650.00 133,650.00 -
12/15/2022 835,000.00 4.000%133,650.00 968,650.00 1,102,300.00
06/15/2023 --116,950.00 116,950.00 -
12/15/2023 870,000.00 4.000%116,950.00 986,950.00 1,103,900.00
06/15/2024 --99,550.00 99,550.00 -
12/15/2024 790,000.00 4.000%99,550.00 889,550.00 989,100.00
06/15/2025 --83,750.00 83,750.00 -
12/15/2025 805,000.00 5.000%83,750.00 888,750.00 972,500.00
06/15/2026 --63,625.00 63,625.00 -
12/15/2026 830,000.00 5.000%63,625.00 893,625.00 957,250.00
06/15/2027 --42,875.00 42,875.00 -
12/15/2027 870,000.00 5.000%42,875.00 912,875.00 955,750.00
06/15/2028 --21,125.00 21,125.00 -
12/15/2028 845,000.00 5.000%21,125.00 866,125.00 887,250.00
Total $8,270,000.00 -$2,242,183.34 $ 10,512,183.34 -
Date And Term Structure
Dated 8/15/2018
Delivery Date 8/15/2018
First available call date 12/15/2026
Call Price 100.000%
Yield Statistics
Bond Year Dollars $48,636.67
Average Life 5.881 Years
Average Coupon 4.6100679%
Net Interest Cost (NIC)2.6166149%
True Interest Cost (TIC)2.4108861%
All Inclusive Cost (AIC)2.5634188%