HomeMy WebLinkAbout13.F.3. General Fund Budget Under-Spend 3. r
CITY OF SHAKOPEE
Memorandum
TO: Mayor and Council
Mark McNeill, City Administrator
FROM: Gregg Voxland, Finance Director
SUBJ: General Fund Budget under -spend
DATE: July 9, 2010
Introduction
Council is requested to review the decision to not count on an under -spend factor in the General
Fund budget.
Background
Years ago, Council factored into the General Fund budget an under -spend amount. This was
based on historical under - spending the budget and resulted in a lower tax levy to balance the
budget. Just in the past year or two, Council decided not to count on an under - spend. The
under -spend percentage for recent years is as follows;
2000 4.0%
2001 8.0%
2002 8.0%
2003 8.0%
2004 5.0%
2005 7.8%
2006 7.3%
2007 4.0%
2008 5.5%
2009 7.1%
The 7.1% under -spend of the original budget for 2009 represents $1,324,439. One percent of
the 2010 budget is $197,677. Under - spending the budget results in an increase in fund balance
which is good. The flip side is that if Council factored in under - spend, the result would be a
lower tax levy or providing a higher budget amount for providing services.
Recommendation
Include a 2% under -spend factor in the 2011 budget.
Action
Move to include a 2% under -spend factor in the 2011 General Fund budget.
Gregg Voxland
Finance Director
H: \Finance\