New Hope City Council Approves 2020 Budget

New Hope City Council Approves 2020 Budget
Posted on 12/10/2019
The New Hope City Council approved the 2020 city of New Hope budget and tax levy at its Dec. 9 meeting.

The 2020 general fund budget is $15,410,550, which is an increase of 8.3% over the 2019 budget. The tax levy for the general fund is $10,511,431, which is a $136,483 or 1.32% increase over the 2019 general fund levy.

The preliminary total tax levy for the entire 2020 budget, including all funds and debt payments, is $16,844,716, which is an increase of $1,543,106 or 10.08% higher than 2019. The majority of the levy increase, $1,334,505 or 8.72%, is for the new pool and park improvement bonds issued in 2018 and 2019.

Although the tax levy is increasing by 10%, the city’s tax capacity has also increased and the estimated tax rate is expected to decrease from 66.6% to 64.55%. Thus, the estimated impact to property owners is only a 3% increase. For homes valued between $150,000 and $400,000, the tax increase is estimated from $28 to $87.

Other major changes in the budget in 2020 include:
• Approximately $700,000 for adding new swimming pool facility operation back into the budget, however, the majority of the expense is offset by revenue from pool user fees.
• Approximately $480,000 for wage and benefit increases; a 3% cost of living adjustment is budgeted for employees along with an increase in the city’s contribution toward health insurance coverage. A 3% increase in city council salaries is also included in the budget.
• Approximately $80,000 increase in the Joint Powers Agreement for West Metro Fire-Rescue District.
• Approximately $60,000 for 2020 election expenses for three separate elections (Presidential Primary, Primary, and General).

New Hope is scheduled to receive more than $800,000 in Local Government Aid from the state of Minnesota in 2020. The revenue will be utilized in the general fund to offset central garage replacement costs.

While the overall tax rate may appear high when compared to other cities, this is because New Hope includes infrastructure improvements in general property tax levy rather than assessing to benefiting property owner (street levy is approximately 9% of local tax levy). Thus, New Hope does not assess taxable properties for street improvements.

Links to the 2020 New Hope budget and a PowerPoint presentation about the budget and tax levy are available at newhopemn.gov/finance.