Maple Grove reviews $35.3 million budget for 2014




The Maple Grove City Council met in a special meeting Nov. 18 to review highlights of the city’s proposed 2014 budget.

The city’s Truth in Taxation hearing on the budget is set for Dec. 2 at City Hall. The City Council is expected to adopt the budget Dec. 16.

The city’s $35,270,300 general fund budget for 2014  represents a 2.19 percent increase over 2013, according to Finance Director Jim Knutson. The 2014 property tax levy amounts to a 2.26 percent increase, he said.

“The proposed 2014 budget will provide sufficient resources to continue the same level of service for a growing city,” Knutson said.

The city portion of property tax for the average value home in 2014 will be $940, compared to $939 in 2013, he said.

Prior to the Osseo Dist. 279 vote approving school referenda, 75 percent of Maple Grove’s residential properties were on target to see a decrease in their overall property taxes, Knutson said. With the passage of the referenda, most homeowners instead will see increases in their overall taxes, according to Knutson.

The city portion for the property tax bill on an average home will increase by approximately 72 cents, Knutson said. The city has an estimated 22,195 homes with an average value of about $239,000.

Knutson said Maple Grove’s rapid growth means that while city officials are planning for services to 64,744 current residents, the city’s population is expected to exceed 80,000 sometime in the future. By April 2014, the population is estimated to reach 65,552 residents, a 1.3 percent increase over 2013 and 30 percent higher than the 2000 census.

“It reflects the tremendous residential construction that has occurred in Maple Grove in the last 13 years,” Knutson said.

Development in Maple Grove continues at a consistent pace,” Knutson said. “There has been significant growth in the city and an accompanying need/demand for service over the last 15 years.”

City officials have implemented some cost-saving strategies, including the elimination of the finance clerk and street superintendent, reduction of assessing technician and rental housing assistant positions from full-time to three-quarter time, delayed rehiring upon retirements and resignations, as well as participating in group purchasing programs and taking advantage of the current interest rate environment by refinancing debt.

The proposed 2014 general fund budget includes the addition of three new position: a light equipment operator in the Street Department, a commercial appraiser for the Assessing Department, and a maintenance worker in the Water/Sewer Department, Knutson said.

Stimulus funds the city received in 2011 for energy saving programs have helped with utility bill savings in 2013 and 2014, he said.

The bulk of the city’s general fund revenue comes from property taxes. In 2014, the tax levy will provide an estimated 83 percent of the revenue.

Revenue from building permits is the second-largest revenue source for the general fund, Knutson said. He expects the total value of building permits in 2013 will exceed $195 million, Knutson said.

“I expect that development will slow in 2013, as there has been a fairly significant decline since the two highest years ever in 1999 and 2000,” he said.  In 1999, the city took in $221.2 million from building permits, and in 2000, the total was $258.1 million, Knutson said.

Maple Grove will levy $1.2 million for the Road Reconstruction Fund in 2014, Knutson said.

The majority of general fund expenses (66.6 percent) are for personal services, Knutson said. Another 27 percent is allocated for supplies, utilities and repairs, with the remaining 6.4 percent going to capital outlay.

Public safety receives 38 percent of the budget, followed by general government, 22 percent; public works, 16.4 percent; parks and recreation and community center, 15 percent; debt service, 5 percent; and road reconstruction, 3 percent.

More than one-third of each Maple Grove homeowner’s taxes (32.8 percent) go to Osseo Dist. 279 schools. Another 32.6 percent of each homeowner’s taxes goes to Hennepin County. The city claims 27.5 percent, and other school districts receive 7.1 percent.