5. 2006-2007 Fiscal Budget - Mill Levy CalculationsPost Office Box. 1997 - Kalispell, Montana -1 7 - Telephone 7 - '00Fax -758-7758
REPORT TO: Honorable Mayor and City Council
FROM-0 Any Robertson, Finance Director
SUBJECT. 2006-2007 Mill .Levy
MEETING DATE: August 14, 2006
BACKGROUND: The proposed budget was presented to Council and a public hearing was
held. Council action was delayed from august � Council meeting until August 1" since the
City did not receive the assessor's "'Certified Taxablevaluation Information"" until August .
The assessor made a change in the Westside TIF district to Northwest Energy taxable value(not
a reduction in value, only the inclusion of the value in the district),. The total tameable value is
reduced by the incremental value when calculating the mill value, therefore, if the incremental
value drops then the city taxable increases. While this 1s good news for the mill levy, it drops the
revenue in the TIF to an uncomfortable level for future projects.
The Adjusted Property tax revenue is also higher than anticipated. However, the levy calculation
formula is used to determine the number of mills that can be levied. The State provides for- an
inflation factor amount of 1..% increase to last year's assessed revenue. Those numbers
provide us with an adjusted property tax revenue which is the amount that. the City can raise
excluding new construction and annexations, $3,997,420. The new taxable value per mill from
the certified levy is $31,855 which includes new construction and annexations. This has required
the City to reduce the value back to the number of mills allowed to generate the adjusted
property tax revenue, That mill value without the new construction is $29,694. By dividing
$31997,420 by the $29,,694 the City cap this year is 134.62 mills, This mill multiplied by the
new mill value results in the City benefiting from the newly taxable property in the amount. of
$290,915 for a total tax revenue o $4,288,335.
This will not change the calculations for the permissive levies since they are voted levies for the
pool, and the fire station. The other levy is the Mate authorized levy for health insurance
increases. These do not fall under the State cap.
Bottom line: the tax revenue is up and mills are down from the proposed 139 to 1 . 2
RECOMMENDATION: None. This is provided for Council's information.
Respectfully submitted,
Amy Robertson, Finance Director es H. Patrick, City Manager