Minutes - Council - 12/05/2005 - Truth in Taxation

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Mayor Gamec stated the Assessor is most likely a few months behind the market; they don't look at the time table or how many times the property sales price has been reduced. Mr. Hartman concurred with the Mayor. Councilmember Cook reminded Mr. Hartman that if he wanted to contest his tax valuation, he should have attended the Local Board of Review last April. Councilmember Cook stated that if citizens want to contest 2007 values, they should attend the Local Board of Review in April, 2006. Mr. Hartman stated he was present at this meeting to ask for clarification about whether taxation was determined mostly by the Assessor or the City financing. He stated that his neighbors don't think they could sell their homes for the Assessor's valuation. Mayor Gamec stated the way houses are selling; the market may not reveal what is actually happening in the sales market depending on how they are financed. Ms. Lund clarified that besides a 15% Limited Market Value, citizens could see an increase in valuation based on improvements that were made to their homes. Ms. Lund explained the proposed general fund budget. She noted that from the proposed 2006 budget, the City has cut $317,000 from the budget. She explained that for 2006, the City has proposed a budget of $10,162,600 in comparison to 2005 when the budget was $8,806,000. This represents a 15.4% increase. She stated the City is required to create a balanced budget, which means revenues must equal the expenditures. She explained that the $10,162,600 represents the balanced budget. Ms. Lund explained that property tax is the largest revenue line item in the budget. The next largest item is the building permits because the City is growing. She explained that revenue consists of taxes, licenses, permits, intergovernmental revenue, charges for services, fines and forfeitures, investment earnings, and other. City Administrator Norman referred to the term "intergovernmental revenue," noting that item was previously called "Local Government Aid." He stated that other cities still receive Local Government Aid (LGA), but Ramsey doesn't receive any. Ms. Lund stated that largest portion of revenue is from taxes at 55%. Property taxes represent an increased $748,000, which is a 14% increase. This does not include the EDA levy in the general fund budget for this portion. She stated what is included in the overall budget is the $174,000 that was cut, which was part of the Market Value Homestead Credit. She explained that the City has lost Local Government Aid in the amount of $304,000. She explained that the City of Ramsey did not receive any of the Local Government Aid promised by Governor Pawlenty this year. She stated the City is still working with the same $304,000 Local Government Aid cut. Ms. Lund noted the next largest revenue item is license and permits. She stated the City has included in the 2006 budget, 981 building permits. That was the reason license and permit section is the second largest on the chart she presented. Ms. Lund stated that intergovernmental revenue is where Local Government Aid was previously listed. She noted that the revenue line item that has increased by City Council Truth in Taxation/December 5, 2005 Page 4 of 13