- Budget 2024
Each year, the City of Faribault embarks on a months-long journey of preparing its budget for the next fiscal year (which starts Jan. 1). The process begins with City staff, and then proceeds to the City Council and the residents of Faribault. Moving forward, you can stay up-to-date on the process by visiting this page, which highlights a timeline on the left, and explores a much deeper dive into the budgeting process below.
What happens before the budget process begins?
Each year, in late March to early April, homeowners across Faribault receive an annual publication titled, "Notice of Valuation and Classification for Taxes Payable for 2024" from the Rice County Assessor's Office. This notice shows the property’s estimated market value as of Jan. 2, 2023 - determined by the County Assessor's office - which is then used to calculate the following year’s taxes for the property and the tax property’s classification.
Rice County’s assessors collect actual sales data on all types of properties in the county, and analyze information such as location, parcel size, improvements and amenities to estimate what a buyer would pay for each property. You can learn more about this process by visiting the Rice County Assessor's website https://www.ricecountymn.gov/149/Assessors-Office.
The notice also lists various meetings called "Board of Appeal or Equalization meeting," which allows the County Assessor to hear objections from property owners regarding the valuation of their property for tax purposes.
Find below a video created by the League of Minnesota Cities that further explains and breaks down property taxes.
Now that the notices have been mailed and the appeals hearings have been held, it signals the start of the budgeting process for the City, which will continue until early December.
City of Faribault to begin budget process at June 20 Council meeting
A preliminary budget must be approved in September, and the final budget in December. The City Council is responsible for review, revision and adoption of the budget and tax levy.
We encourage members of the public to get involved, whether it be by following this page, visiting the Council meetings to hear about the budget proposals, or by attending one of the two public hearings (Sept. 12 and Dec. 5) . We will continue to update content on this page as the process unfolds. In the meantime, find below more details about the City of Faribault budget, and what it all entails.
WHAT MAKES UP THE BUDGET
The budget in its entirety is made up of many funds, including the General Fund, Special Revenue Funds, Debt Service, Capital Projects, Enterprise Funds, Internal Services Funds, Library Donation Special Revenue Fund, and Agency Funds. See below for a deeper dive into the fund, in addition to how it's used.
- The General Fund is funded primarily from ad valorem taxes (property taxes in proportion to the value) and Local Government Aid (LGA). The General Fund accounts for all revenues and expenditures of a governmental unit which are not accounted for in other funds. It is usually the largest and most important accounting activity for state and local governments, normally receiving a greater variety and number of taxes and revenues than any other fund.
- Special Revenue Funds are established for specific revenues or sources that are designated for financing particular functions or activities as required by federal regulations, state statute, City Charter provisions, local ordinances, or specific grant agreements. These funds include City, Housing and Rehabilitation Authority (HRA), and Economic Development Authority (EDA) funds. City special revenue funds include Charitable Gambling, Public Safety Programs, Airport, City Rental Property, Community Development, Rental Housing Rehabilitation, and SCDP Revolving Loan funds. The HRA special revenue funds include the HRA, Public Housing, and CRV Rehabilitation Program funds. The EDA special revenue funds include Industrial Development Revolving Loan, Federal Investment Revolving Loan, Minnesota Investment Revolving Loan, Tax Increment Financing funds, EDA, and EDA Revolving Loan funds.
- Debt Service Funds are used to account for the accumulation of resources for and the payment of principal, interest, and related costs on long-term general obligation debt of governmental funds.
- Capital Project Funds include the Street Improvement Projects Fund, Park Improvement Fund, Capital Replacement Fund, and Facility Maintenance Fund. Preliminary budgeted expenditures for these funds are detailed and included in the five-year Capital Improvement Plan. Expenditures for the Capital Replacement Fund are financed by or funded with franchise tax, grants, and fund balance. Expenditures for the Public Facility Projects Fund are funded with franchise tax and transfers from the General Fund and fund balance. Capital Project Funds are used to report major capital acquisitions and construction separate from ongoing operating activities.
- Enterprise Funds include the Water, Sewer, and Storm Water funds. Enterprise Funds are used to account for operations that are financed and operated in a manner similar to private business enterprises where the intent is that the costs (expenses, including depreciation) of providing goods or services to the general public are financed or recovered primarily through user charges. These improvement projects are detailed in the five-year Capital Improvement Plan.
- Internal Service Funds include Workers Compensation and Property Liability. The City became fully insured for workers compensation with the League of Minnesota Cities in 2014. The existing Internal Service Fund is maintained to offset future costs of a single outstanding claim that was opened under the self-insured plan. Internal Service Funds provide centralized services primarily to other funds, departments or agencies of the City of Faribault. These services are provided on a cost reimbursement basis and are recovered through fees and charges.
- Agency Funds are used to account for assets held by the City as an agent for private organizations and for the various funds of other governmental units, most notably the Elderly Housing Corporation and Robinwood Manor.