2. Resolution 4511 - Annual Tax Leviesof Kalispell
Post Office Box 1997 • Kalispell, Montana 59903-1997 • Telephone (406) 758-7700 • FAX (406) 758-7758
REPORT TO: Mayor Boharski and City Council Members
FROM: Amy Robertson, Finance Director
Chris Kukulski, City Manager
SUBJECT: Mill levy - FY2000 Budget
MEETING DATE: October 4, 1999
BACKGROUND: The resolution is adopted annually to provide a levy to fund the City's
Budgets for the General Fund, Comprehensive Insurance Fund, Health Insurance Fund,
Retirement Fund and G. O. Bond. In addition the City -County Health levy is listed on the
resolution. The mill levy is set at the allowed amount per the calculations on forms provided by
the Department of Revenue. The levy calculation adjusts the mill value for changes resulting
from SB 184 and HB260.The new City levy is 114.25 mills. The County Health Department levy
is 4.40 (provided by the County).
Attached is the completed worksheet which shows the effects of the SB 184 tax legislation.
The work sheet begins with the prior year certified mill levy which anticipated $2,358,643 in
revenue for the City's milled funds in FY99.
This worksheet takes into account the HB260 effect which is related to the motor vehicle tax.
HB 260 lowers the 2% tax to 1.4% effective January Is'. This results in a revenue loss of
$33,794 for the fiscal year ('/2 year impact). The calculations also factor in the HB20 and SB417
personal property reimbursements which we have been receiving and which are being phased out
at 10% a year. Those losses of revenue are offset with SB 184 reimbursements ($48,970) to arrive
at the Adjusted Property Tax Revenue Assessed- (6) on the worksheet. This would be the
number which is the amount of tax revenue our new mill levy can assess to remain at the same
level as last year. The calculations continue using the new taxable value ($21,339 provided by
DOR) which has to be adjusted for Newly Taxable Property to bring it back to the same level as
last year. The newly taxable property includes construction and annexations. The result is that a
mill levy of 114.25 is required to provide the previous year adjusted property tax revenue(6).
See worksheet.
The 114.25 mill levy will provide additional revenue to the extent of Newly Taxable Property.
The Council has the option of lowering the levy. However, the levy which you adopt becomes
your new revenue cap. The additional money generated by annexations and new construction
will be paid by those property owners. Revenue from newly taxable property may be in
increment districts. The State was unable to supply the breakdown to the districts. Any
additional revenue from newly taxable property will be split on the mill levy. It would be my
recommendation that the City maintain the levy at 114.25 which would leave the General Fund
with a 16% reserve. Individual tax bills may be up or down depending upon their taxable
valuation.
I would like to note that the Prior Year Mill levy which was to generate $2,358,643 (111.16 mills
times $21,218) actually only provided $2,254,275. That is the amount the County billed out on
behalf of the City. This happens because the mill value changes as people go through the appeal
process. So you see that we may or may not benefit from newly taxable property. I do think
because we received our values so late in the year that there will not be a substantial change this
year. Levy information is due to the County on Thursday.
I also want you to be aware of the further impacts of tax legislation which will go into effect next
year. Personal property, business and commercial, rates will decline from 6% to 3%. Any
business whose personal property market value after depreciation is $5,000 or less will be
completely dropped from the tax roll. This is good news for commercial tax payers but not
necessarily good news for the City if those costs are passed along to the homeowners. Of more
concern is the change in rates for utilities. Tax rates for electric, phone, gas, and
telecommunications (class 9 property) will drop from 12% to 6%. The class nine property in the
City is currently valued at a market value of $37 million which will provide approximately
$511,000 in tax revenue this year (market value x 12% x .11425 mills). We could see a drop of
$250,00 next year. The County assessor has indicated that there is no additional provision for
reimbursements to local government. We will see the impacts of HB260 on motor vehicle
revenue for a full year. The HB20 and SB417 reimbursements will decline 10% per year until
they are gone. The SB 184 reimbursements are for this fiscal year and 2001 only.
Do consider the long range needs of the City with growth to both the north and south when
considering the levy. As our service area expands so do our costs. Please call me anytime
Monday if you need further information.
RECOMMENDATION: Adoption of Resolution 4511 setting the mill levy at 114.25 for the
City and 4.40 for the City -County Health Department..
FISCAL EFFECTS: Levy will generate $2,437,980 in tax revenue for the City and $93,887
Revenue to fund the Health Department.
ALTERNATIVES: As suggested by Council.
Amy H. Robertson
Finance Director
C " A ,
r
Chris A. Kukulski
City Manager
RESOLUTION NO. 4511
A RESOLUTION MAKING THE ANNUAL TAX LEVIES FOR THE CITY OF
KALISPELL, MONTANA, FOR THE FISCAL YEAR 1999-2000.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AS
FOLLOWS:
SECTION I. That there is hereby levied upon each and
every dollar of the taxable valuation of the City of
Kalispell, Montana, for the fiscal year 1999-2000, the
following levies:
GENERAL FUND 69.54 MILLS
COMPREHENSIVE INSURANCE 10.28 if
RETIREMENT 14.39 If
HEALTH INSURANCE 18.50 it
GENERAL OBLIGATION BOND 1.54 If
SUBTOTAL 114.25 MILLS
CITY/COUNTY DEPARTMENT OF HEALTH 4.40 "
TOTAL 118.65 MILLS
PASSED AND APPROVED BY THE CITY COUNCIL AND MAYOR OF THE CITY OF
KALISPELL THIS 4TH DAY OF OCTOBER, 1999.
Wm E. Boharski, Mayor
ATTEST:
Theresa White
City Clerk
v
Compliance, Valuation & Resolution Montana Department ofREVENUE PO. Box 920
Flathead County, Region 1 Kalispell, Montana 59901-0920
1999 Taxable Valuation Information
(in compliance with 15-10-420,MCA)
Flathead County
Taxing Jurisdiction Kalispell City
1. Total Taxable Value (current year — 1999) $21,338,655
(from line 4, 1999 Certified Mill Levy Form)
2. Total Taxable Value of Newly Taxable Property $757,493
Includes:
a. Newly taxable Property Prior to Accounting for Eliminated
Property as Identified in TPR Spreadsheet, plus
b. Total Taxable Value of Eliminated Property from line 5a.
1999 Certified Mill levy Form
Don Hoffman, Randy Wilke, Dolores Cooney - Administrative Team
Telephone (406) 758-5921A Fax (406) 758-5671 A Internet Address http://www.state.mt.us/revenue/rev.htm
SB 184 PROCEDURE FOR CALCULATING LEVY
PROPERTY TAXES ASSESSED IN PRIOR YEAR:
Ad Valorem Tax Revenue assessed (previous year)
(calculated by DOR 111.16 mills x 21,218 mill value)
Add: Light Vehicle Tax Revenue (actual fy99)
Less: Light Vehicle Tax anticipated -current year
Add: Personal Property Tax reimbursement rec. -prior year
(HB20 & S13417)
Less: Personal PropertyTax reimbursement anticipated -current year
(HB20 & S13417)
Less: SB 184 Reimbursement
Adjusted Property Tax Revenue Assessed
CURRENT YEAR TAX LEVY COMPUTATION:
Taxable Value Per Mill
Less: Newly taxable property - current year
Adjusted Taxable Value per mill
Authorized mill levy under SB 184 (includes floating mills)
Adjusted Taxable Value per mill
Add: Newly taxable property per mill - current year
Taxable Value per mill (including newly taxable property)
Authorized Mill levy under SB 184 (includes floating mills)
Current Property Tax Limitation
RECAP:
Previous Year Adjusted Property Tax Revenue assessed (6)
Amount attributable to newly taxable property
Current Property Tax Revenue
DOR = Dept. of Revenue
Assumption
and Comments
Certified levy $ 2,358,643 (1)
actual fy99
$
225,282
(3)
85 % of fy99
$
(191,488) $
33,794 (3)
actual fy99
$
78,268
(4)
DOR
$
(70,241) $
8,027 (4)
DOR $ (48,970) $ (48,970) (5)
$ 2,351,493 (6)
DOR $
21,339
(7)
DOR $ (757) $
(757)
(8)
$
20,582
(10)
114.25
(11)
$
20,582
(10)
DOR $ 757 $
757
(8)
21,339 (7)
(6)/(10) 114.25 (11)
J 1)*(7) $ 2,437,980 (12)
$ 2,351,493 (6)
(11)*(8) $86,487 (13)
$ 2,437,980 (12)
sbl84calc 9/27/99
EXPLANATIONS:
(1) Ad valorem tax revenue is.determined by multiplying the previous year levy by the previous
taxable value.
Property taxes assessed for net and gross proceeds Is determined by multiplying the previous year
mill levy times the previous year taxable value for net and gross proceeds. This deduction
is requited under subsection 5 of Section 1 of SB 184.
(3) The amount for prior year amounts received can be obtained from the prior year general
ledger revenue account for light vehicle taxes (314110). The amount for current year anticipated
revenue represents the amount of revenue estimated for the current year.
(4) The amount for prior year amounts received can be obtained from the prior year general
ledger revenue account for personal property tax reimbursements (335210). The amount for
current year anticipated revenue represents the amount of revenue estimated for the current year.
(5) Both amounts for the SB 184 reimbursements and the reimbursement under HB 658 will be provided
by the Department of Revenue.
(6) This amount is the net of (1) through (5)
(7) This amount is taken from the certified mill levy information supplied by the Department of Revenue.
(8) Newly taxable property is taken from the certified mill levy information supplied by the Department
of Revenue.
This amount can be determined from the Department of Revenue (county only).
(10) This amount is the net amount of taxable value less newly taxable property as defined in
SB 184 and net/gross proceeds taxable value.
(11) The floating mill is determined by dividing the adjusted taxable value per mill (10) into the adjusted
property tax revenue assessed (6).
(12) Determined by multiplying the mill levy (11) by the current year taxable value inclusive of newly taxable
property(7).
(13) Determined by multiplying the newly taxable property (8) plus net/gross proceeds (9) by the calculated mill (11).
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