Agenda - Council - 12/20/1983 - Laserfiche WebLink

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I I I I I I I I I I I i I I I The resulting figure is increased for inflation and population growth to arrive at an adjusted local revenue base.l_~3/ This adjusted local revenue base is used as a measure of the revenue need of a city. The next step is to determine the "fiscal capacity" of a city. As in the 1979 formula, fiscal capacity is measured by a city's equalized assessed valuel4/ multiplied by a set tax rate of ten mills. This component of the formula reflects a city's ability to raise revenue through property taxes.15/ The next step is computing a city's local government aid amount. This amount is the difference between the revenue the city needs and the amount ~t is able to raise through property taxes. It is computed by taking the city's adjusted local revenue base minus the product of 10 mills times its equalized assessed value.16/ This is the same calculation that was used in the 1979 formula to get the preliminary state aid factor (PSAF). Although that label has been eliminated from the statute, for convenience it is retained in this discussion-of the 1983 formula. 13/ 15/' 16/ 1983 Act § 8. See Ex. 3, lines 15-23. Ramsey's 1984 adjusted local revenue base was $1,017,002. Ex. 3, line 25. Equalized assessed value is simply a new name, adopted in i~R1, for adjusted assessed value. It is calculated in the same way. See n. 8, supra. Ramsey's equalized assessed value was $60,480.929. Multiplied by ten mills (.01), it equals $604,809. See Ex. 3, lines 26 and 27. 1983 Act § 11. For Ramsey, this calculation was: $1,017,002 - (.01 x $60,480,929) = $412,193. See Ex. 3, line 28. -12-