Brooklyn Park City Council kicks off the upcoming budget and levy process

The city council heard projections for the 2018-19 city budgets at a Sept. 5 work session. The preliminary 2018 general fund budget city staff members have proposed is $51.1 million, and the proposed 2019 general fund budget is $53.2 million.
The amended 2017 budget is $48.9 million. Original budget forecasts for 2018 were projected at $48.9 million.
Preliminary general fund revenues are projected to be up in 2018 and 2019, with projected revenue for 2018 at $51.1 million, a 4.6 percent increase from the previous year, and projected revenue for 2019 at $53.2 million, another 4.1 percent increase.
To pay for the budget increase, the city would need $40.8 million in property taxes in 2018, and $42.6 million in 2019.
Total levy projections, which include all city levies, would see a 6.32 percent increase over 2017 levy rates, if approved by the council.
Fiscal disparities funding, which is part of a system for partial sharing of commercial-industrial property tax base among all taxing jurisdictions in a geographic area, is projected to decrease by approximately $144,000 in 2018. Total fiscal disparities revenue is projected at approximately $8 million.
In 2017, the city received approximately $8.1 million in fiscal disparities funding.
Mayor Jeff Lunde said the city has expected to see larger reductions in fiscal disparities funding and has budgeted as such.
Local government aid from the state is not included in the general fund budget. The city primarily uses local government aid to reduce its Heritage Fund Levy, according to City Manager Jay Stroebel.
The city received $1.2 million in local government aid in 2017. For 2018, $1.4 million in local government aid is projected.
In large part, city staff members have planned for the budget increase to cover an assumed 2.5 percent cost of living adjustment to staff salaries, Stroebel said. However, since approximately two thirds of employees are represented by a union, the precise rate of compensation for these employees will be determined in upcoming negotiations, he said.
Approximately 75 percent of the city’s budget is related to personnel costs, Stroebel said.
Next, the council will need to set a preliminary levy. The preliminary levy sets the maximum rate at which the city could set its final levy. Once the preliminary levy is set, city staff will work with the council to determine a final levy rate that the majority of council members are amenable to.
Traditionally, city staff members recommend that the council adopt a preliminary levy that is at the highest rate allowed by law, arguing that this gives the city more leeway to set a final levy rate that reflects the city’s needs and planned service level.
The median-valued home in Brooklyn Park is on the rise, according to Finance Director LaTonia Green. Median values for homes paid in 2017 was approximately $190,500. Median values for 2017, paid 2018 are $214,800.
Development in the city has also raised the taxable value of the city.
Councilmember Bob Mata spoke in opposition of raising the budget and levy rates, and said he would not support setting the preliminary levy at the highest legal level.
“How can I go back and tell all these people that are on fixed incomes, social security, whatever, they’re living on fixed incomes that have got no raises for a number of years, to expect them to pay constantly 2 percent, 2.5 percent increases and … cost for food, cost for heating and lighting, everything else going up … but they don’t get any increase, so where do I tell them to get their money so they can pay for all the increases that we have to pay for?” he said.
“I’m just really hopeful that this council doesn’t try to nickel and dime each department, but rather stay up here at this higher level and not get in the weeds this year, because it’s not really our purview to do that,” Councilmember Lisa Jacobson said. She said she hopes the council does not attempt to reduce city services as the city grows in an effort to cut taxes.
Councilmember Rich Gates said he is comfortable setting the preliminary levy at its maximum rate, with the knowledge that city staff will propose a lower rate for the final levy.