1. 2022 Budget, Tax Levy and Capital Improvement Plan Review
City of Otsego│13400 90th Street NE, Otsego, MN 55330│Tel. (763) 441‐4414 Fax (763) 441‐9163
TO: Mayor and City Council
FROM: Adam Flaherty, City Administrator & Finance Director
DATE: August 30, 2021
SUBJECT: Budget Meeting #6
On Monday, Council and staff will resume review of the draft 2022 General Fund budget. This
meeting is the third and final the special meetings scheduled for budget and tax levy review.
Please note that staff is seeking Council input during these budget review meetings in order to
effectively and efficiently move the budgeting process forward.
I have developed an outline of discussion topics below.
Property Tax Levy
Attached with the packet for this meeting, is an updated summary. Staff will review and explain
any changes that have occurred since the last budget meeting. Staff would be seeking Council
consensus at each meeting regarding the direction of the preliminary property tax levy amount.
Budget Review
Council and staff will be reviewing General Fund department budgets as outlined in the attached
review schedule.
Council Roundtable
This is an opportunity for the Council to express their current view on the budgets as presented
thus far and to discuss any recommended changes to the preliminary budgets and tax levies.
Next Steps
The Council will need to adopt the preliminary property tax levy, which is the maximum amount
the City can levy for taxes payable 2022. This action will take place at a regular Council meeting,
either on the 13th or the 27th of September, depending upon Council direction.
It should be noted that the preliminary property tax levy is the amount used for truth‐in‐taxation
notices that are sent to the taxpayers by Wright County.
City of Otsego│13400 90th Street NE, Otsego, MN 55330│Tel. (763) 441‐4414 Fax (763) 441‐9163
The final budget and property tax levy will not be adopted by the City Council until December.
Changes to the budget can still be made between now and then, but increases to expenditures
become difficult because the primary revenue source to pay for those increases is property taxes.
The property tax levy can be decreased between now and then, but the levy cannot be increased.
Staff is seeking direction from the City Council on how they would like to proceed.
Materials Attached for Discussion
1) Property Tax Levy Summary
2) Department Expenditure Review Schedule
City of Otsego
Property Tax Levy Calculations
Payable 2022
Revised: August 25, 2021
$% $%
2020 2021 2022 Change Change 2022 Change Change Comment
General Revenues 4,518,000 4,671,000 4,980,000 309,000 6.62% 4,980,000 309,000 6.62%
Tax Abatements 56,491 45,874 40,422 (5,452) ‐11.88% 40,422 (5,452) ‐11.88%
Debt Service
Series 2010B 460,000 460,000 ‐ (460,000) ‐ (460,000)
Series 2018A 91,758 94,551 97,187 2,636 97,187 2,636
Series 2020A 195,000 195,000 450,000 255,000 450,000 255,000
**NEW** ‐ ‐ ‐ ‐ ‐ ‐
Sub‐total 746,758 749,551 547,187 (202,364) ‐27.00% 547,187 (202,364) ‐27.00%
Capital Reserves
Pavement Management 950,000 1,050,000 1,100,000 50,000 1,100,000 50,000
Trails Management 33,000 40,000 43,000 3,000 43,000 3,000
Parks Equipment 60,000 62,000 64,000 2,000 64,000 2,000
Capital Equipment Revolving 280,000 300,000 320,000 20,000 320,000 20,000
Fire Reserve 180,000 190,000 200,000 10,000 200,000 10,000
Storm Water 32,000 34,000 36,000 2,000 36,000 2,000
Capital Improvements 318,000 661,000 ‐ (661,000) ‐ (661,000)
City Buildings & Property 20,000 25,000 30,000 5,000 30,000 5,000
Sub‐total 1,873,000 2,362,000 1,793,000 (569,000) ‐24.09% 1,793,000 (569,000) ‐24.09%
Tax Rate Management (Flexibility) 966,186 966,186
Grand Total 7,194,249 7,828,425 8,326,795 498,370 6.37% 8,326,795 498,370 6.37%
Growth (%) 7.22% 8.82%
Tax Capacity 20,742,285 22,876,221 24,331,856 24,331,856 1% of Local Board of Appeal Estimate
Growth (%) 10.95% 10.29% 6.36% 6.36%
Net Tax Capacity 20,497,278 22,591,258 24,028,761 24,028,761 98.75% of Tax Capacity (Based on 2021)
Growth (%) 10.15% 10.22% 6.36% 6.36%
Tax Rate 35.099 34.653 34.653 34.653
Population 17,323 18,130 18,130 18,130 Source = MN State Demographer
Tax Levy Per Capita 415 432 459 459
Taxing 2020 2021 2022 2022
Authority Final Tax Rate Final Tax Rate Estimate Change Estimate Change
City of Otsego 35.099 34.653 34.653 0.00% 34.653 0.00%
Wright County 44.421 43.719 43.719 0.00% 43.719 0.00%
School District 34.371 31.717 31.717 0.00% 31.717 0.00%
School District ‐ RMV 29.961 30.598 30.598 0.00% 30.598 0.00%
Description 2020 2021 2022 Change 2022 Change
Median Appraised Value 247,859 258,455 290,081 12.24% 290,081 12.24%
Less: MV Exclusion (14,933) (13,979) (11,133) (11,133)
Taxable Market Value 232,926 244,476 278,948 14.10% 278,948 14.10%
Tax Capacity 2,329 2,445 2,789 2,789
2020 2021 2022 2022
Taxing Estimated Estimated Estimated Estimated
Authority Tax Tax Tax Change Tax Change
City of Otsego 818 847 967 14.17% 967 14.17%
Wright County 1,035 1,069 1,220 14.13% 1,220 14.13%
School District 801 775 885 14.19% 885 14.19%
School District ‐ RMV 743 791 888 12.26% 888 12.26%
Total 3,397 3,482 3,960 13.73% 3,960 13.73%
Annual Increase 478 478
Meeting #5 (8‐23‐2021) Meeting #6 (8‐30‐2021)
Levy Description
The City rate is calculated by the Finance
Director. County and School District tax rates
were obtained from Wright County, and
represent the tax rate from their respective
preliminary levies and are NOT FINAL.
Source = Wright County Assessor
These are best estimates calculated by the
Finance Director based upon information
available at the time of presentation. These
should only be considered as estimates, and
should NOT be considered final.
X:\Budget\2022\Property Taxes\Tax Levy Calculations 8‐30
Department Page Completed Department Page Completed Department Page CompletedRevenues 2YesCity Administrator 7YesAdministration 9City Council 5YesAssessing 12YesElections 11Legal 17YesFinance 13YesPrairie Center 20Emergency Management 30YesInformation Technology 15YesCity Hall & Public Works Building 22Animal Control 31YesHuman Resources 18YesOld Township Site 24Streets 32YesPolice Services 25YesEngineering 36Street Lights 37YesPublic Safety Commission 26YesPark Maintenance 40Fleet Management 38YesFire Protection 27YesRecreation 42Economic Development 48YesBuilding Safety 28YesHeritage Preservation Commission 44Parks and Recreation Commission 45Planning Commission 46Planning 47Interfund Transfers 50August 9 August 23 August 30X:\Budget\2022\2022 Budget Calendar