City Finances

The budget process matches estimated revenue with projected expenditures for that year. It also determines the General Fund Property Tax portion of the total City tax levy. The General Fund Property Tax is the primary revenue source of the General Fund. In any year, the total City tax levy also includes amounts in addition to that needed to operate the General Fund.

he annual Budget Calendar is based on statutory requirements and operational needs.

May

Operating and Capital Improvement Program (CIP) information is provided to departments. Access to the online budgeting tool is granted to directors and relevant staff to allow for the start of budget planning.  

June

Staff develops proposed budgets by completing edits in the online budget tool. 

July

Meetings with City Manager and Department / Division Heads help to finalize staff’s budget proposals. This allows City leadership the opportunity to ensure planned spending aligns with strategic objectives. 

Meetings are held with elected officials to introduce the proposed budgets and the preliminary proposed tax levy. Once again, the strategic objectives of the City are compared to planned spending and overall consideration of fiscal capacity. 

August

At the August Council Work Session, City leaders review the proposed budget with elected officials at a public meeting for the first time. The discussion includes the projected levy and its impact on property owners. This session includes a review of all operating, Capital, and HRA budget proposals. 

September

At the September Housing and Redevelopment Authority (HRA) meeting, the HRA adopts the proposed budget for the following year. 

At the next September Council Meeting, the City Council adopts the City’s levy, which includes the General Fund as well as the required debt levy. Council also consents to the HRA levy as previously adopted by the HRA. 

By September 30, the City is required to certify to the County a proposed property tax levy for the following year.

Mid-Nov

Proposed Property Tax notices sent by Hennepin County to all property owners in the City.

Dec

The HRA considers the final HRA budget and levy.

The City Council considers the final budget and levy and considers consenting to the final HRA levy and budget.

Capital improvements are major purchases and/or construction projects that cannot be financed in one year as part of the regular budgeting process because of their expense. They include:

• street construction and reconstruction
• storm sewers
• water mains
• sanitary sewers
• purchases of large pieces of equipment, such as dump trucks and motor graders

The Capital Improvement Program (CIP) document, which is updated annually and adopted by the City Council each December, schedules these expenditures for the upcoming 10 years. It also includes proposed financing for these expenditures, such as the proceeds of General Obligation Bonds and Enterprise Fund operations.

General Obligation Bonds are a city’s primary means of borrowing money. The bonds are "serial," meaning that various amounts of principal are paid off in each year of the bond term. The term of the bonds varies with the City’s needs and the interest rate varies with market conditions at the time the bond is issued.