Agenda - Economic Development Authority - 09/13/2012

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Economic Development Authority (EDA) Meeting Date: 09/13/2012 By: Kurt Ulrich, Administrative Services Title: 2013 EDA Budget 4. 6. Background: This item was reviewed briefly at the EDA Special meeting of September 6, in conjuction with the discussion of the levy recommendation. The recommendation of the EDA was to request the Council continue the levy at the 2012 level, and to continue the discussion of the budget at September 13 EDA meeting. The EDA levy is included within the City's general levy. The Council will be considering the City's preliminary levy on Tuesday, September 11. The purpose of this case is to develop an EDA budget based upon the Council's established preliminary EDA levy. Observations: The primary source of revenue for the EDA budget is the EDA levy. Included in this case is a copy of the draft 2013 EDA budget, that was reviewed on September 6. The levy amount requested by the EDA would add $65,387 to the budget, if approved by the City Council. The EDA should determine which programs and /or line items of the budget should receive additional allocations. Overall, the EDA draft budget as previously proposed was to decrease from 2012 to 2013 ($172,853 to $106,466). The reason for the decrease is the changed allocation of personnel costs. The decrease in proposed budget was attributed to the decrease in personnel costs related to the position of the deputy city administrator not being refilled and the funding of a new economic develoopment/HRA position being 20% funded from the EDA versus 60% in 2012 The levy is based on the City's total taxable market value of the preceding year. For payable 2012, the City would be allowed a maximum levy of $321,996. A significant portion of the levy can be used for personnel services and other operational costs, housing and /or redevelopment costs. The EDA levy can be used to buy property, professional services, marketing activities, and the like. In summary, are three major items to consider when reviewing the EDA budget (1) operating expenses (2) personnel. (1) Operating Expenses include everything but City personnel. From 2012 to 2013 the budget remains nearly the same (slight increase). (2) Personnel includes City human resources (referenced as "Wages & Salaries" in the EDA budget). From 2012 to 2013 Wages & Salaries decreased from $103,742 to $35,086 ($ 68,656 difference). (3) Undesignated Levy Allocation - The levy amount requested by the EDA would add $65,387 to the budget, if approved by the City Council on September 11. The EDA should determine which programs and /or line items of the budget should receive additional allocations. Note, the proposed reduction in the budgeted EDA "Wages and Salaries" line item does not reflect a reduction in the core functions of the EDA, it reflects a change in allocation of those functions (i.e. increased role from consultant and administrative staff).