Unknowns remain with OPH budget

OPH rockOfficial says changes likely by December

OAK PARK HEIGHTS — The proposed 2014 budget and preliminary levy approved by the Oak Park Heights City Council Tuesday is likely not the final budget and levy the comes to the council in December for approval.

The council approved a proposed ‘14 budget of more than $5.177 million budget and a more than $4.674 million preliminary general fund levy for certification by the Washington County Auditor’s office.

City Finance Director Betty Caruso said Oak Park Heights’ preliminary general fund levy is at the state’s legal limit.

“We will be levying at that (state) limit,” she said.

Including the $139,000 general obligation capital improvement bond levy, the city’s total ‘14 levy is nearly $4.785 million, Caruso said.

But several unknown factors would probably lead to changes to the ‘14 budget and preliminary levy before the council votes on final numbers at its Dec. 10 meeting. That vote would occur after the city’s “Truth in Taxation” hearing on the levy and budget at that early December session.

Caruso said unknowns hanging over the ‘14 budget include contract talks with the city’s three employee unions and new service agreement with the Bayport Fire Department.

Other factors affecting the city’s ‘14 budget is a decrease in the city’s tax capacity and the city’s contribution to the state’s fiscal disparity fund, Caruso said. The drop in tax capacity means the Oak Park Heights property owners will pay more in city taxes next year, she added.

“Bringing that down will raise people’s taxes,” she said.

How much city taxes increase is not known yet, Caruso said.

“It’s still uncertain. They will pay more because of the decrease in our capacity to spread,” she said.

Caruso said Oak Park Heights will again be a contributor to the state fiscal disparity fund.

“We are one of the major contributors to fiscal disparity,” she noted.

Caruso said increases in the city’s ‘14 budget include:

  •  $11,000 for debt service;
  • $19,000 for contract snow plowing;
  •  $20,532 for health insurance;
  •  $16,900 in capital costs and other contract and supply expenditure increases and decreases;
  • $80,843 in public safety due to budgeting for the retirement of an Oak Park Heights Police Department officer and other public safety costs, and
  • An estimated $34,000 increase in the city’s contract with the BFD.

“The fire contract, we’re still working on that,” Caruso said. “We haven’t worked out the final fire contract with the Bayport Fire Department.”

Although Caruso said adjustments would likely be made to the ‘14 budget this fall, the preliminary general fund levy amount cannot increase.

“These amounts can change the budget, however they cannot increase the tax levy any greater than what is proposed and adopted at (tonight’s) meeting,” she said in a memo to the council.

Caruso said city staff would continue looking for savings prior to council adoption of the 2014 budget and levy.

“As a staff and council, we will continue to look at expenditures for any areas where we can save,” she said.

Contact Erik Sandin at erik.sandin@ecm-inc.com

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