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General Fund Highlights <br />Main Subfund Overview <br />The General Fund Main Subfund is the general operating fund for the City of Eugene and is used <br />to account for all financial resources except those required to be accounted for in another fund. <br />Principal sources of revenue are property taxes, charges for services and intergovernmental <br />revenues. <br />Budget discussions tend to focus on the General Fund Main Subfund because the revenues are <br />non-dedicated and can be spent for any government purpose. As such, the General Fund Main <br />Subfund is discussed in greater detail in the Budget Message and Budget Summary sections of <br />the Proposed Budget document. Additionally, a detailed discussion of the General Fund Main <br />Subfund revenue assumptions and analysis methodologies is in the Appendix of the Proposed <br />Budget document: <br />• Changes in the State of Oregon's property tax system in the 1990's placed constraints to <br />growth in property tax revenue. Ballot Measure 5 (1990) established constitutional limits <br />on local property tax rates for all taxing districts, which reduced the amount of revenue <br />collected by local governments. Ballot Measure. 50 (1997) enacted permanent tax rates, <br />reduced assessed value to ninety percent of their 1995-19961evels, and capped assessed <br />value growth of existing properties at three percent per year. The City of Eugene <br />prioritized its service system in response to each of the ballot measures. <br />• The service system was prioritized again in 2002-2003 due to fund expenses growing <br />more rapidly than fund revenues in the Main Subfund. Twenty seven services were <br />assigned to four priority levels during the FY04 budget process. <br />• ,The City of Eugene's permanent tax rate is $7.0058 per $1,000 of assessed value. <br />However, the effective tax rate is estimated at $6.90 per $1,000 of assessed value due to <br />the impact of the Urban Renewal Agency valuation and overlapping tax rates. <br />• Factors that cause total assessed value to increase more than three percent in a year are <br />new construction, site improvements, and expired enterprise zones. <br />• The annual budget building process includes asix-year forecast of revenues and <br />expenditures. The City's practice is to balance the Main Subfund for at least the first <br />three years of the six-year. planning horizon. The latest forecast show a structural <br />imbalance in the fund with expenses outpacing revenues. A realignment of service. levels <br />is proposed during FY08 to rebalance the fund in FY09. <br />• Changes to current service levels in the General Fund are detailed in the Budget Message <br />and in the department and service views of the budget. <br />29 <br />