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CASE #11: <br />DISCUSS THE 1988 LEVY LIMIT <br />By: Noel Graczyk, Finance Officer <br />Background: <br />For the budget years 1987, 1988, and 1989, the State of Minnesota has in place <br />laws that limit the City to an overall levy limit. The laws, however, also <br />allow the City to levy special levies, at the City's discretion, outside the <br />overall limit. <br />The 1987 Legislature, however, imposed a new levy law for budget year 1987 that <br />limits increases in the levy limit to an inflation adjustment of only three <br />percent instead of five. The new law also eliminates all but six special <br />levies. The only levies available to the City of Ramsey would be for various <br />debt service payments. This law was put in place for budget year 1988 only. <br />The old laws will be used once again for budget year 1989, but the three <br />percent inflation adjustment will remain in place. However, the 1988 <br />Legislature has not yet met, and they may once again change the laws. <br />Enclosed for your information is a summary of the levy limit history. Also <br />enclosed is a memo to City Administrator Hartley which discusses several <br />factors relating to the levy limit. <br />It should be noted that for 1988 the City could submit to the State by August <br />21, 1987 a request to allow additional levies over and above the overall limit <br />and special limit. However, the State will be restrictive as to the additional <br />levies they will allow, and it is unlikely that the City of Ramsey could argue <br />favorably for any of the acceptable adjustments. <br />Recommendation: <br />Council action will be to discuss. <br />Review Checklist: <br />Administrator <br />Attorney <br />Engineer <br />Community Development Director <br />Chief of Police <br />Finance Officer <br />Public Works Superintendent <br />Other <br />32 <br />