HomeMy WebLinkAboutCity Council Minutes 11-29-1995 BOEMINUTES
SPECIAL COUNCIL MEETING
TRUTH IN TAXATION HEARING
NOVEMBER 29, 1995
A special meeting of the Plymouth City Council was called to order by Deputy Mayor
Edson at 7:00 p.m. in the City Center, 3400 Plymouth Blvd., on November 29, 1995.
PRESENT: Deputy Mayor Edson; Councilmembers Lymangood, Wold, and Granath.
ABSENT: Mayor Tierney; Councilmembers Helliwell and Anderson.
STAFF PRESENT: City Manager Johnson, Assistant City Manager Lueckert, Finance
Director Hahn, Public Works Director Moore, Public Safety Director Gerdes, Community
Development Director Hurlburt, Assistant Finance Director Jacobson, Park Director
Blank, and City Clerk Ahrens.
Deputy Mayor Edson announced that the purpose of this special meeting is to conduct the
Truth in Taxation hearing. At the end of this meeting, the council may close the hearing
or continue the hearing on December 6. The purpose of this hearing is to receive public
input on the 1996 proposed budget and tax levy. The council will take no action to adopt
a budget or levy this evening.
Deputy Mayor Edson stated that within the past several weeks, residents have received a
Truth in Taxation statement. The statement indicates the assessed value of property for
1995 and 1996, as well as the proposed taxes payable in 1996. The City of Plymouth
represents about 12 percent of the proposed taxes that appear on the statement. The
remaining 88 percent of the proposed taxes would go to Hennepin County, the affected
school district, and other special taxing jurisdictions. He noted the dates of the Truth In
Taxation hearings for the other jurisdictions.
Deputy Mayor Edson explained that if the assessed value of a residential or business
property increased from 1995 to 1996, it may have resulted in an increase in taxes. The
purpose of the Truth In Taxation hearing is not to contest the assessed value of property,
but to receive public comment on the proposed tax levy and tax rate. Residents will
receive a value notice for their property in March 1996, establishing the 1997 assessed
value.
City Manager Johnson presented the proposed 1996 budget. He described a sample Truth
in Taxation statement and showed the 1996 proposed City taxes as a percentage of the
average tax bill. The City tax capacity rate was 15.84 in 1995, and a reduction to 14.89 is
proposed for 1996. The average valued home in Plymouth ($166,800) increased about
5.1 percent in value in the last year. He said that the overall tax burden on an average
valued home varies by school district from a 3.9 percent increase in Osseo School District.
279 to a 16.20 percent increase in Wayzata School District 284.
Manager Johnson explained that City taxes on an average valued home are proposed to
increase from $388.40 in 1995 to $389.52 in 1996. He stated that Plymouth's tax rate
would be the lowest compared to similar metro communities. Plymouth would have the
Truth In Taxation Hearing
November 29, 1995
Page 2
second lowest tax rate of the 75 cities in Minnesota over 10,000 in population. He
presented a chart showing tax calculations for the average valued home in recent years:
401.57 in 1993, $388.41 in 1994, $388.40 in 1995, and $389.52 (proposed) in 1996. He
noted that the proposed City taxes for 1996 would be less than the amount paid in 1993.
Manager Johnson reviewed market value trends and tax capacity comparisons from 1993
to 1996. He stated that during the last few years, the assessed value of businesses has
generally stagnated, while residential properties have continued to appreciate in value.
From payable 1,995 to payable 1996, total residential property value in the city has
increased by 10.4 percent, compared to 2.9 percent for apartments, and 4.0 percent for
commercial properties. This results in an overall increase in value in the city of 8.7
percent.
City Manager Johnson reviewed the major operating funds and noted that a 3 1/2 percent
increase is proposed in the General Fund budget for 1996. He stated that Plymouth is still
a growing community, and the City significantly contributes to the fiscal disparities pool.
He cited tax abatements, HACA reductions, and building permit revenue reductions as
impacting revenues for 1996. An objective of the City for 1996 is to replenish major
reserve funds. The revenue and expenditure projections for 1995 indicate an estimated
1995 surplus of $385,000. He recommended that the surplus funds be used as follows:
200,000 to offset future tax abatements, $85,000 to pay lease purchase payments on a
dump truck, and $100,000 to replenish the building reserve and computer reserve funds.
Manager Johnson showed a pie chart of proposed City spending and revenues for 1996,
and stated that 74 percent of the General Fund expenditures is for Public Safety, Public
Works, and Park and Recreation activities. Sixty percent of the General Fund budget is
for personnel salaries and benefits, while 30 percent is for contractual services. Property
taxes are the major source of revenue (72 percent) for the General Fund budget. He said
that the City currently has 210 full-time positions, with 5 new positions proposed for
1996.
He summarized that there has been a substantial value appreciation in the average home
over the last few years; however, the City has continued to reduce the City tax rate during
that time. The reduction has more than offset the average home inflation value. Plymouth
receives far less state aid than most other communities, and the City exports 11 percent of
its tax base outside of Plymouth through fiscal disparities. He said that the proposed
budget will continue to increase technology, while allowing for work on a number of
projects such as development of northwest Plymouth, long-range financial planning, and
development of ordinances to protect the environment. In addition, the City has recently
completed a long range analysis of the City's recreational needs, and the City is
considering partnerships with other cities, school districts, and private enterprise.
Deputy Mayor Edson opened the Truth in Taxation hearing at 7:30 p.m.
Frank Knourck asked why businesses in Plymouth do not pay a larger share of the tax
burden and how Plymouth compares to surrounding communities.
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November 29, 1995
Page 3
Manager Johnson explained that businesses contribute about half of the total taxes paid,
with residential properties paying the remaining half. Businesses account for about 1
billion dollars of the total market value in Plymouth, while residences account for about 2
billion dollars. However, businesses pay a higher tax rate than residential properties. He
stated that Plymouth has a greater proportion of taxes paid by businesses than similar
communities.
Bruce Kelly, 620 Lanewood Lane, asked if Plymouth will receive less state aid and transit
aid in 1996. Manager Johnson estimated that Plymouth will receive $78,000 less in state
aid than in 1995. Public Works Director Moore estimated the transit revenues will be
reduced by $10,000.
No one else appeared for the Truth In Taxation hearing. Councilmembers invited
residents to phone staff with questions or comments on the proposed budget and tax levy.
MOTION was made by Councilmember Granath, seconded by Councilmember
Lymangood, to close the Truth In Taxation hearing. Motion carried, four ayes.
Deputy Mayor Edson announced that the City Council will consider adoption of the 1996
budget and tax levy at the December 5 regular council meeting.
The meeting was adjourned at 7:38 p.m.
ra, C, G -
Laurie Ahrens
City Clerk