Agenda - Council - 08/23/2022 - Laserfiche WebLink

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Acting Mayor Riley asked if they needed to discuss any of the information, as it was previously indicated that these options were what the Council wanted to do. He said that these options helped them get ahead in working on the roads by taking out bonds, and 15 years was the middle ground, as 10 years was too short and would cost too much money. He asked if the Council was wanting to move forward with that. Councilmember Specht stated that he definitely likes option three, and wasn't aware of anyone who was in favor of option one. He wanted to move forward with option three as soon as possible. Acting Mayor Riley said that he thinks the huge advantage to option three over option one is that they have more money upfront with option three. With option one they do not have the ability to get ahead and front load the work. He thinks option three is the best and requested they move forward with option three. Finance Director Lund said that she plugged in numbers to the whole budget with options one or three. The numbers were based off the tax capacity rate, which she used to figure out the tax of that. She explained there is not a huge difference between options one and three. Option one is a 41.5% rate versus option three being a 41.13% rate, which is a lower rate but gives the money up front for the roads. She also gave a comparison of what the last three years look like for overall levy and tax rates. She said the major factor in why the tax rates stay so low is because they have a 26% value increase. She then discussed the effects on the taxpayers, both residential and commercial. In regard to commercial, she added that this is their City portion only. She said that the tax effect of the increase for residents, City portion only for the tax bill, based on the median value home is a $272 increase by issuing the 15 year debt and the full budget request. She said there is also a percentage increase to residents, which was listed on the handout. She said that each Councilmember is on the handout. She explained it is a running total or comparison for each year, so as Councilmembers come up the list gets bigger, noting these are all actual numbers of valuations. Councilmember Woestehoff asked Finance Director Lund to explain the difference between a few of the columns on their handouts. Finance Director Lund explained the blue column is the difference between the two yellow columns. She said that looking under "2022 City Portion Taxes A" and then looking at "2022 City Portion Taxes B," the two yellow columns, the blue column is the difference between these two. Acting Mayor Riley asked if they were looking at a 25% to almost 30% increase. Finance Director Lund said yes, the lowest increase was 19% for the highest priced home because it did not increase as greatly in value. Overall, she said to look at the median value homes, which would be about a 24% increase. Councilmember Woestehoff added that the median property value increase is approximately 27%, so it is around 22-23% for every residential home, on average. He said what he was trying to ask is whether the average property value went up 23-24% and the tax increase is basically 23-24%, all things being equal, if the property value stayed the same there would be no tax increase. City Council Work Session / August 8, 2022 Page 2 of 19