Saturday, October 31, 2009

The hard numbers

The new levy rate numbers are in, based on the dollars. As I reported before, we reduced our budget $933,000 for 2010. In fairness we increased the HRA levy an additional $100,000 for a net overall decrease of $833,000.
The decrease reduces taxes 9.8%. Our tax rate in 2009 was 39.264%, our 2010 tax rate is 37.686%.
I have become a little discouraged at the lack of reporting of this good news for Ramsey.
Some cities claim to have kept taxes the same, even fewer have reduced. Have they really kept them the same?
Many cities rely on franchise and other fees to make their bloated budgets. Our city has no franchise fees.
It is true we do have some fees such as, street lights, storm water and others, but we did not increase any of those in an effort to hide increased taxes.
Bottom line, we now have less taxes in Ramsey.


  1. What was the total reserves balance at the start of the year? What is it now, going into the new budget. That is with the understanding that loans from reserves went to buy the foreclosed half of Town Center in hopes that the loan and more would be returned when parts of the project get sold off, but that's hope and not certainty. The new water tower is the same, hope, not certainty.

    How do the change in reserves look, going into 2010?

  2. Have you considered whether the City can redeem some debt via a rollover - if current rates are lower and there are buyers, is there any chance the debt service burden from the palace building binge can be lessened? Has Finance Committee and Ms. Lund had any look in that direction?

  3. As to fund balances i will get and post that info. I want to post accurate information but I know that we borrowed around 4.8 million from the water and utility fund to buy town center land.
    I will post more information tomorrow.

  4. Eric,
    I am short on time for now but here is something to chew on until I have time to completely answer your comments.

  5. You linked to 2008 numbers. The 2008 CAFR numbers reflect a period when council makeup differed from the present. Town Center was in litigation, end of 2008 and no third water tower expenses were incurred. Also, I found no date on the auditior's report, so that the lag time between close of the year and preparation of the CAFR is unclear from the face of the item, in terms of when we can expect the 2009 CAFR to be posted on the City website so we can compare things. Having both CAFR items would be good for year end numbers, 2008 and then 2009, so that once the 2009 CAFR is released changes in capital account balances will be apparent. One thing I expect Ms. Lund could fairly easily determine is how, over time the annual reserves earnings as a percent of reserves held, vs the rate being paid on bond debt compare; i.e., she might easily provide an answer on whether it's costing taxpayers to hold large reserves while at the same time incurring large bond debot loads, i.e., is there a net difference on the rate earned on reserves over time and the amount paid on bonds. If the net favors holding reserves great then hold large reserves, while if the net favors lessening reserves instead of issuing bonds great, then spend down the reserves. It is such a fundamental question that it has to have already been answered by city officials - it would border on negligence to not have an immediate answer to have we been borrowing at a higher rate than reserves have earned, or not. I realize that in past years before 2008 that might not have appeared as a question of burning interest at the council table but now with astute business persons predominating on council, it should be already nailed down as a certainty one way or the other.

  6. A few other uncertain things in saying the budget's going down not up:

    The water treatment plant - when's that postponed to and what is the current guess at cost?

    The "community center" that some are pushing for - what's the guessed at public cost were it to be done, and is there any reasonable guess of whether it will happen or be shelved?

    The 2008 CAFR has an item "culture and recreation" which is cryptic. What does Ramsey spend on "culture?" Little I would guess. There's no library, no WiFi, so it's all parks, or not?

    98.8% parks?

    I did not find any line item in the 2008 CAFR for annual maintenance cost for the parking ramp.

    Is that number available and if so what is it? (Including lighting costs.)

    The subsidized bus service, either I misread it being broken out in the 2008 CAFR or that net expense to taxpayers has been rolled into [some might say hidden] in some aggregate. Is that monthly number available and is it expected to increase when Northstar operates?

    Does the planned lowered budget include capital and operating cost for a Northstar stop, were one to be attained, or would that be a budget increase or new add-on item?

    I suppose the last two questions boil down to whether Ramsey's better subsidizing Northstar ridership, or bus services, as a taxpayer burden. Is there an answer among city officials?

    If not an answer, an informed guess?

  7. I am told that the 2009 CAFR will not be completed until mid year 2010.
    You are correct there is a new council and new town center ownership.
    In general we are getting about 3% return on our investments. We were able to bond for just over 2% net. for the sunfish project. This project was a product that this council inherited from previous councils, along with the trouble to find the dollars to pay for it.
    There is no need for a water treatment plant. We can currently pump over 11 million gallons of water a day. We are told that we can drill another well if needed. If we were to need one, the projected cost is around 20 million.
    The community center idea is not mine! The only community center I would be interested in would be privately funded.
    You got me on the culture and recreation. I will need to look into this.
    The parking ramp has an annual cost of $120,000 for maintenance and electricity. I need to check but I believe it is paid for from the HRA budget.
    FYI. we have applied for a TIGGER grant. If we get the grant, which looks very promising, it will pay for solar panels that will create enough energy to power the ramp and them some.
    The Bus...we currently have a grant that funds a large portion of the operating cost of the bus service. That grant will run out soon. We intend to continue a bus service from our ramp until a train stops in Ramsey.
    This bus service will be run much different than the current one. I will create a post when the details are being discussed.
    I am confident that we can operate a bus service that is much less subsidized than the train or our current bus service.

  8. Refinancing the Taj-Ma-Jal is not a good option. The early call on the bonds make it not an option at this time.