New Hope City Council Approves 2021 Budget

New Hope City Council Approves 2021 Budget
Posted on 12/15/2020

The New Hope City Council approved the 2021 city of New Hope budget and tax levy at its Dec. 14 meeting. The 2021 budget focuses on continuing to provide existing services and programs with current resources and on public safety. The 2021 general fund budget is $15,936,977, which is an increase of $526,427, or 3.4%, over the 2020 budget. The tax levy for the entire 2021 budget is $17,417,601, which represents a 3.4% or $572,885 increase over the 2020 levy of $16,844,716, which was a 10.08% increase. Although the tax levy is increasing, the city’s overall tax capacity has also increased and the estimated tax rate is expected to decrease from 64.7% in 2020 to 62.5% in 2021. Major changes in the budget for 2021 include:

  • Approximately $244,000 for wage and benefit increases; a 3% cost of living adjustment is budgeted for employees along with an increase in the city’s share of health insurance coverage; and a 3% increase in City Council salaries.
  • Approximately $156,000 for phase one of police department body and squad camera purchases and deployment with phase two scheduled for 2022. This cost will be funded by the IT reserve fund in order to minimize impact to the general fund tax levy.
  • Approximately $85,000 for West Metro Fire-Rescue District due to an increase in New Hope’s share of the joint powers agreement and approximately $33,000 for replacement of the shared emergency generator between the fire district and the new police station/city hall facility.

New Hope is scheduled to receive more than $865,000 in Local Government Aid from the state of Minnesota in 2021, an increase of nearly $50,000 from 2020. The revenue will be used to help cover general fund central garage equipment and building replacement costs, not general operations.

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.

Additional information is available by viewing the complete 2021 budget and presentation linked below.