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File #: 210662    Version: 0
Type: Ordinance Status: In Committee
File created: 9/1/2021 In control: FINANCE & PERSONNEL COMMITTEE
On agenda: Final action:
Effective date:    
Title: An ordinance relating to the minimum and maximum balances in the tax stabilization fund.
Sponsors: THE CHAIR
Attachments: 1. Fund Balance Policy Presentation, 2. Hearing Notice List
Date Ver.Action ByActionResultTallyAction DetailsMeeting DetailsVideo
9/15/20210 FINANCE & PERSONNEL COMMITTEE HELD TO CALL OF THE CHAIR

Minutes note: Appearing: Aycha Sawa, Comptroller Joshua Benson, Deputy Comptroller Matthew Schnackenberg, PFM Richard Li, Comptroller's Office
Pass5:0 Action details Meeting details Video Video
9/1/20210 COMMON COUNCIL ASSIGNED TO   Action details Meeting details Not available
Number
210662
Version
ORIGINAL
Reference

Sponsor
THE CHAIR
Title
An ordinance relating to the minimum and maximum balances in the tax stabilization fund.
Section
304-29-5 am
304-29-6 cr
Analysis
This ordinance increases the maximum ceiling balance of the tax stabilization fund from 5%of the current year, total common council controlled budget to 15% of the most recently audited year’s general fund expenditures as reported by the office of the comptroller. It further creates a minimum floor for the tax stabilization fund of 10% of the most recently audited year’s general fund expenditures.
Body
Whereas, The Tax Stabilization Fund is intended to assist in stabilizing the property tax rate and is sourced by various surplus funds from prior years; and

Whereas, Standard and Poor downgraded the City’s bond rating from AA- in 2019 to A in 2020; and

Whereas, The Tax Stabilization Fund balance is one of the primary indicators rating agencies evaluate to determine municipal bond ratings; and

Whereas, The Comprehensive Annual Financial Report from the Office of the Comptroller indicates that total general fund expenditures in 2019 was $756,027,000; and

Whereas, Establishing a minimum required balance for the Tax Stabilization Fund would prohibit any transfers out of the Tax Stabilization Fund and into the general fund should the Tax Stabilization Fund balance fall below its minimum floor; and

Whereas, Establishing a minimum required balance would preclude the need for the Common Council or Mayor to directly transfer property tax revenue into the Tax Stabilization Fund should it fall below its minimum floor, a practice that undermines the Tax Stabilization Fund’s purpose in creating a less volatile property tax burden; now, therefore

The Mayor and Common Council of the City of Milwaukee do ordain as follows:

Part 1. Section 304-29-5 of the code is amended to read:

304-29. Tax Stabilization Fund.

5. MAXIMUM CEILING ON FUND. Any uncommitted balance ...

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