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HomeMy WebLinkAbout07.26.10 Work Session Minutes Council Budget Workshop Minutes July 26, 2010 Mayor Larson called the workshop to order at 6:36 p.m. Present: Peter Herlofsky, City Administrator; Teresa Walters, Finance Director; Jim Murphy, Sergeant; Randy Distad, Parks and Recreation Director; Kevin Schorzman, City Engineer; Todd Reiten, Municipal Services Director; Lisa Shadick, Administrative Services Director; Brenda Wendlandt, Human Resources Director; Tim Pietsch, Fire Chief; Cynthia Muller, Executive Assistant Council was given a history of budgets for each division from 2008 to 2011 department requests. Each department showed a 2% and 5% increase and decrease in their budgets. Councilmember May asked if the decreases and increases were from the 20 II requested amount or the 2010 budget. Finance Director Walters replied they are from the 2011 request amounts because Council was originally given an increase of .32%, which is no increase. City Administrator Herlofsky stated the non-personnel costs are the same in 2011 as in 2010. Engineering Engineering consists of Engineering, Planning, Building Inspections, and Natural Resources. Councilmember May went back to her fIrst question, looking at the 2010 numbers and 2011 requests, there is a difference. Finance Director Walters stated there are mandated items, such as health insurance. Human Resources Director Wendlandt noted some increases we have no control over such as the maintenance agreements for IT. Councilmember May asked if staff is assuming Council agreed on the 2011 requested number. Finance Director Walters stated the 2011 department request number is no increases with the exception of increases we have no control over. City Administrator Herlofsky stated yes, we have assumed the 2011 requests is what we would be working from. Mayor Larson asked if Council assumed it would be from the 2010 numbers. Councilmember May did, going back to the fIrst workshop. Mayor Larson did not recall they discussed which numbers to use for increases and decreases. Councilmember May stated staff is saying all the increases from 2010 are mandated. Finance Director Walters stated there were shifts in line items, but they were not increases. Any increases are mandates. Councilmember Donnelly stated the 2011 numbers are less than a 1 % increase over the whole budget. Councilmember May agreed that may be overal~ but she was trying to understand it by department. There is more of a difference in Engineering, than there is in Planning or Building Inspections. City Engineer Schorzman agreed it is not uniformly split. Engineering Division - A 2% decrease would mean a delay in responses to resident concerns and slower follow-up on development items, slower review of as-builts and grading inspections. All ofthese delays are attributable to a reduction in professional services which would limit the amount of additional help we would have and shift it over to City staff to take care of. With two people, they would not be able to get to it as quickly without consultant help. A 5% decrease would be the same impact, but at a higher magnitude. A 2% and 5% increase would be the exact opposite with having more help. The 2% amounts to $5,753 and 5% amounts to $14,382. These are not of the magnitude where you can make personnel type decisions. The only adjustment was for how much help you can get for City employees. Mayor Larson stated professional 10 Council Workshop Minutes July 26,2010 Page 2 services and personnel would be the only places to cut. City Engineer Schorzman agreed. For a $14,000 reduction in the Engineering division, in supplies there is only $6,000 so even wiping that out we would still have $8,000 to go so that would shift to services which includes IT and professional services. Professional services comprises $45,000 ofthe $74,000 total services. Councilmember May stated so the rest of professional services is internal services. She asked if department heads have discussed decreasing some of those numbers. City Engineer Schorzman stated that covers lega~ IT, cell phones, dues and subscriptions, training, mileage, equipment repair and vehicle maintenance. Dues and subscriptions, training and mileage amount to $2,000. The big ticket items in the Engineering division budget are the $45,000 in professional services, $10,000 in lega~ $11,000 in IT and then vehicle maintenance at $3,000. Planning Division - The 2% decrease would be realized in the professional services portion. Staffhas been taking the lead on many things such as the comp plan. This decrease would not have noticeable affect now, but if there were situations where we did need that, it would not be available. The Planners have the ability to work on the comp plan without a lot of outside help because development has slowed down. Had they been reviewing plats and building permits, they would have needed help with that or with the comp plan. Ifbuilding development picks up, then that is when they would need to dip into the professional services. A 5% decrease would affect that category further, but staffwould not recommend that. Councilmember May stated going back to the Engineering division, this was the only area that did have quite a jump from 2010 to 2011. She asked what would be mandated in that area. City Engineer Schorzman stated the increases occurred in the personnel services side including salaries, the overtime was not changed; FICA, Medicare, PERA benefits is where the change occurred. The supplies and services budgets stayed the same as 2010. City Administrator Herlofsky stated the IT services has a very small change of$300. Building Inspections - All but $350 oftheir supplies is fuel. This affects them being able to get out into the field and do what they are supposed to do. It does not seem feasible to reduce that, because it will not do us any good to have the inspectors locked in City Hall. This is one area were we cannot cut. All but $1,770 of the services portion is directly related to their ability to conduct business; having the computer systems for permits. Of that amount $1,470 is for training and subscriptions, but the inspectors are required to do continuing education to maintain their certification and licenses. The subscriptions are to keep their code books updated. The maximum cut would be $300 and City Engineer Schorzman did not advise that. The only way to cut 5% would be in personne~ but you have to do inspections. Making a personnel cut is counterproductive when you would have to hire someone to do their job. City Engineer Schorzman felt it would be beneficial to add to this budget. Allowing some overtime would allow us to get caught up with the current staff. The downside is we would pay time and a half. Mayor Larson asked for a further explanation on getting caught up. City Engineer Schorzman stated in the past there was very quick response as far as doing inspections. Some builders are getting irritated because they want an inspection this afternoon and we are three days out for inspections. An additional part time person or increasing overtime would allow us to reduce that service time to something our customers think is reasonable. Increasing by 5% would provide some part time help during the summer. Natural Resources - The 2% would amount to $2,059 and 5% would amount to $5,147. City Engineer Schorzman recommended the reductions be made from professional services. This is 11 Council Workshop Minutes July 26, 2010 Page 3 used to hire professional tree removal and trimming companies that are too tall for our equipment to reach. These would be boulevard trees. The impact of this reduction is dependent on Mother Nature. Ifwe have a storm we would have to determine ifwe clean up the damage and where does the money come from. Approximately 25% of this category is mandates. The Natural Resources Specialist is also budgeted in the storm water fund and that is where the mandates are. Councilmember May asked if it was common practice for cities to have a Natural Resource division or can it fall under other areas. City Engineer Schorzman has not looked into that, but someone would have to perform the work. City Administrator Herlofsky stated each City has it organized differently. City Engineer Schorzman stated for the 5% increase it would be nice for staff to have more training. We trim hundreds of trees a year and need to keep up on training. We could also use the increase to replace some trees. Council then went back to the introduction. Finance Director Walters stated each department showed a 2% and 5% increase and decrease. Individual budgets have not changed from the last meeting except for a very small number in IT. That was distributed to all of the departments. At the last meeting staff presented a budget that showed a 3.9% increase. Since then some things have changed. At the last meeting Finance Director Walters recommended transferring $300,000 from the capital acquisition fund. It was labeled as a capital levy and was also budgeted in the capital acquisition fund. As she was not here last year, she thought it was a capital levy that went into the capital acquisition fund. Actually, it was a place holder for the market value reduction. Ifwe would have received the market value credit, it would have been placed in the capital acquisition fund. Ifwe did not receive it, it would be there to take the hit of losing the market value credit. So now, we cannot use that money to transfer as we will not be getting that money. Not only will we not receive the $300,000, but the amount we are going to lose will increase to $415,000. City Administrator Herlofsky stated with the program in place a couple years ago, we levied a certain amount. The taxpayers saw a reduction in their tax. That was a reduction in the levy we adopted. The state used to send us money for that reduction. Then the State said the program will continue, but the state is going to reduce the levy and not return the money. The option was to have a special levy in 2010 for the money we lost in 2009. With the special levy we tried to have the levy in 2010 be whole by receiving the special levy. We will need a special levy of$415,000 in 2011 because of what we were short in 2010. Councilmember Wilson stated we would not have to levy the $415,000; we can reduce the budget by that amount. Councilmember May stated fundamentally we have to take that language out ofthe discussion. We have to shrink the budget or call the levy a certain amount and not have a special piece. Mayor Larson asked when we found out it would be $415,000. Staff stated the LMC just sent out a notice this week. Referring to the actual budget document, Councilmember Donnelly noted in 2010 it shows $350,000 in the capital acquisition fund. The fund balance at the end of2010 is $556,000. Finance Director Walters explained it won't be because we will not be getting the $350,000. The $415,000 is what we are losing in 2010, that we are able to levy in 2011. Councilmember Donnelly confIrmed we levied in 2010 what we did not get in 2009. Finance Director Walters stated in 2010 we are not getting the $350,000 and in addition to that another $65,000 will have to come from somewhere because we are not getting that portion of the taxes. City Administrator Herlofsky stated the special levy that we levied does take care of what we lost, but it is not in the capital acquisition fund. Councilmember Donnelly asked why it says it is in there. Finance Director Walters explained at the time this budget was done, we did not know if the state would cut the market value homestead credit again. So ifwe did get it, this is where we would 12 Council Workshop Minutes July 26,2010 Page 4 have put it. At the last meeting staffhad proposed to use the capital acquisition fund for the police vehicles, but since we do not have that money, the expense is back in the general levy. There is a $65,051 increase in the market value homestead credit levy and also an increase in the general fund levy for the police vehicles. That has increased the levy to 2.27%. We originally thought it would be .32%. Councilmember May stated we do not have to increase the market value homestead credit levy. Finance Director Walters stated ifwe don't increase it, we will have to take it from somewhere else. We will need to have a line item for the market value homestead credit. If you don't want to increase it by $65,000, we can take it from somewhere else. The state is saying there will be another $415,000 market value homestead reduction in 2011. Staff presented three options: 1. Levy for the entire amount ofthe debt service. All the options are related to the debt service funds. By the end of2010 there will be a debt in the debt service fund of$269,000. In addition, we are also looking at an increase in the debt service payment. We only levied $77,200 in 2010. Councilmembers asked why. City Administrator Herlofsky explained it goes back to the Vermillion River Crossing project in 2005 and the general obligation improvement bonds 2006A. When this was approved in 2005 for Vermillion River Crossing, there was an effort make to keep the bond payments small for the fIrst three or four years giving the project a chance to generate the revenue to cover the development cost. Development did not occur. In 2005 the community wanted commercial development. As a result ofthe development not being successfu~ efforts to support it, and the $1 million grant and the developer contributing the other $1 million, the developer needed help and the City offered help. Now it is 2010 and the project is not completed. The City now has to levy sufficiently to catch up, pay the bond debt, and when the property is purchased and the assessments come against the property, the City should get reimbursed unless the assessments are waived by the Council. Every effort was made in the beginning to make the project possible. They used initial funds from the owner and other sources and they have been used up. Now we have a substantial amount to pay. Councilmember Wilson stated the schedule in the budget did not come out of nowhere. We knew there would be a balloon payment for the remaining 16 years. This item came up with a tax abatement and he voted for the 15 year abatement and Council supported the effort. He asked why we only levied for $77,200 when we knew our expenses were $359,941 a year ahead of the fact they jumped another $200,000. Was it that the fund balance would have to be reduced or staffmg situations would have to change? City Administrator Herlofsky stated it was not meant to be a surprise. Having a new Finance Director gave us a fresher look at some items and made some things more apparent. From 2006 with the reduction in market value homestead, the reduction of $500,000 in building permits, efforts in the budget process were focused on the general fund and keeping the levy as reasonable as possible. If Council wants someone to blame for not bringing this to Council sooner, he will take responsibility. He maybe should have been more aware of the situation. Councilmember Wilson took full ownership on the policy decision to support the abatement. The entire Council was on board with that policy at the time. We look at the debt service every year as part of the budget, and the fact this item is going up $180,000 this year, plus we under levied last year. City Administrator Herlofsky agreed the situation is very uncomfortable. Councilmember Donnelly stated none of us would have wanted to raise the levy another $200,000 last year which we should have done. It would not have been any more pleasant last 13 Council Workshop Minutes July 26,2010 Page 5 year. The point was to make the levy impact as small as possible. City Administrator Herlofsky stated staff is recommending option 3 which is some internal borrowing. Councilmember Wilson asked how we arrived at a 30% increase in building permits. Finance Director Walters explained at this time we are at 98% of our budget in building permits. In looking at that and what we budget last year and projecting to next year, that is what she estimated it to be while staying conservative. City Administrator Herlofsky stated next year we can expect the 66-unit CDA senior housing and we have received indication the CDA will be completing the second phase of the townhomes on hwy 3. This amounts to 89 units with nothing else happening. Councilmember Wilson stated this category is so unpredictable he would rather knock it down to the 2010 level and make a mid-year adjustment to reallocate. Councilmember May agreed. Councilmember Fogarty stated that reduces the budget by another $100,000. Finance Director Walters went back to explaining the three options: 1. Levy for the entire amount including the deficit for 2010 and levy for the increase in the debt service payment. This would be an increase in the levy of 10.96%. We would not have to take on any new debt and would not borrow from any other fund. A portion of the 10.96%, 7.68% is for the debt service. The following year the levy would be reduced by 4.99% because it is not a consistent levy. It is a one-time occurrence to cover the deficit. The levy would then remain consistent. 2. Borrow the funds to cover the deficit, a one time item of $269,000 and increase the levy to cover the increase in the debt service payment. This would result in a 7.71 % overall increase in the levy. The portion for the debt is 4.44%. Going forward there would be minor increases. The disadvantage is the loan would be out there for 10 years at 3% interest. It would take $331,336 to pay it back. 3. Keep the amount the way it was previously proposed at $261,000 at the last meeting. Take the $462,600 difference and borrow the entire amount. It would be over 10 years at 3% interest. It would be a 5.37% overall increase in the levy. The loan payment would be $53,889. With this option we would also utilize the equipment note levy that is set to expire in 2011 in order to keep the increases in the levy at a minimal amount. The disadvantage is that we would not have the equipment note levy and still have an increase in the levy of$53,889 because of the loan. Council then continued with the 2% and 5% decreases and increases in each department. Administration Legislative Control (Council's budget) - Reduced dues and subscriptions by eliminating Metro Cities which is greater than 2%. Ifwe increased the budget we would keep that affiliation and increase training for Council. Councilmember Fogarty asked how we can control the use oflegal services. City Administrator Herlofsky suggested just having the City Attorney attend the first meeting of each month. 14 Council Workshop Minutes July 26,2010 Page 6 Historic Preservation Commission - Reduce consultant activity. An increase in the budget would increase the consultant activity, add mileage for training, provide funds for markers for designated historic properties. Administration - Many items cover things for all departments such as office supplies, copiers, and postage meter rental. To reduce the budget we could purchase fewer office supplies, use the City Attorney less, not use outside printing such as business cards, reduce newspaper subscriptions, reduce travel expenses, reduce the use of color copiers and possibly eliminate some color copiers. If increasing the budget, continue with color copiers, add training for Administrative staff. Councilmember Wilson asked why personnel costs are not shown as in other departments. Administrative Services Director Shadick explained the reductions were based on the total dollar amount of the line item plus personnel, but we did not take it out of the personnel numbers. Councilmember Wilson felt it would not take direction from Council to say lets reduce office supplies and equipment supplies. Any of these are no brainers. He felt it would be easy to take 5% off the budget right now. City Administrator Herlofsky stated it is easy to do, but we want to make sure we can provide copies of things to the public. We now have the agendas electronically which saves paper each week. He noted employees are even reusing file folders. Finance Director Walters added our supplies are very lean. Mayor Larson stated when we ask for a budget we need 12 months worth of supplies. He hoped staff would not present a budget where we would run out of paper. Communications - We would reduce the fee for survey monkey, reduce postage and use more e- mail. Ifwe do more with e-mail as an increase this may be a listserv. Another increase could be training for communications staff. A 5% reduction was not shown as there is not enough to cut. Councilmember Wilson asked if the calendar is produced through this area. Staff explained the calendar is produced with the enterprise funds and selling ads. Personnel costs would be partially attributed to the calendar. City Hall- Not charge the City for municipal services, reduce gas and electric use, building supplies and repair would be reduced because it is a new building. An increase could include carpet cleaning and window cleaning more often. Mayor Larson asked for the reason for so many lights being on over night. Staff explained some are security lights. Also, the cleaning staff is here at night. Cleaning of the building falls under professional services. Staffwill be obtaining bids this year for cleaning services. Community Development - City Administrator Herlofsky explained anything more than a 2% reduction would be personnel. We have cut training. An increase would include more training and peer assistance. Human Resources/IT Human Resources - A reduction would include cut citywide training, and reduce the use of the labor attorney. Mayor Larson asked what would happen ifwe do less training. Human Resources Director Wendlandt stated it limits our liability ifthere are employment issues. She also cut the employee assistance program, employment advertising in the Star Tribune, and the employee recognition service program. An increase would cover consulting assistance for new mandated reporting, additional citywide training and salary increases for staff. 15 Council Workshop Minutes July 26,2010 Page 7 Councilmember Wilson asked how many cities of our size have an H.R. Director. Human Resources Director Wendlandt replied ifthere isn't an H.R. Director, there is usually an Assistant City Administrator. Councilmember Wilson asked why not look at eliminating the H.R. Director position and use a consulting H.R. fIrm for some of the general requirements such as FMLA and use the City Attorney for the legal items. He asked how that would impact operations throughout the City. Human Resources Director Wendlandt replied right now the utilization of the City Attorney or labor attorney is very low. A consultant is an hourly rate so you could pay more or less ifthere are no issues. City Administrator Herlofsky stated with an H.R. Director you get more added value without a larger cost. A labor relations attorney would cost a lot more than it does now. We only use it when we need it. Councilmember Wilson stated he would not eliminate the employee recognition program. He asked when was the last time we did an RFP for an employee assistance provider. Staff stated it has been 4-5 years so we could do another one. Councilmember Wilson stated there are more vendors now with diverse services who might be able to do reporting that would provide more insight into the workforce. IT - Staff cut overtime. After hours support as been limited for the liquor stores, police, fIre, and issues at City Hall. Most of the calls are taken by the H.R. Director, but if she is not available staff needs to use overtime. Fuel can be cut and have no impact. We no longer have a vehicle for IT and borrow a parks and rec vehicle or engineering vehicle. Reduce office supplies which are used if a mouse is bad, for more cable, disks, etc. Reduce data processing which would limit the help with server builds and repairs, cut maintenance agreements on various IT equipment. Maintenance agreements are for lmageTrend software for the Fire Department, video cameras, Microsoft office software, etc. An increase would be used for computer training to limit our reliance on LOGIS and outside vendors for support. Mayor Larson asked how that would affect us fmancially in the long run. Staff explained the regular rate for LOGIS is $98/hour. For police and fIre systems they have to meet certain requirements. Mayor Larson asked if there was more training in this department, could we lower our costs. Staff replied in the long run training would pay for itself. In the short term there would still be some reliance. Mayor Larson asked with more training in this department can we reduce our consultant fees and have that pay for the training and more. Staff replied yes and no. We would be better trained to handle issues, and no because we have a lot of systems and not a lot of manpower. A 5% increase would cover the cost of adding a listserv. Finance Finance Director Walters stated 83% of her budget is personnel; 4% is for audit costs; 12% is for data processing and IT; 1 % for lega~ printing, dues and subscriptions and training. She could not cut 2%, so she cut the 1 %. She could not cut 5% unless we go into personnel. She has sources to call other than legal. Printing is used for printing fmancial reports. Dues and subscriptions cover membership in the GFOA and the MNGFOA. As far as training, she is a CPA and needs training to maintain her certification. This was also included in negotiations for her position. There is very minimal training for staff. The GFOA meetings have already been cut for this year. Councilmember Wilson would not cut the CPA training. This would also apply to any other department. Councilmember Fogarty asked what benefit is received from having an audit every year. What ifwe audited every other year? Staff explained we cannot do that; the state would 16 Council Workshop Minutes July 26, 2010 Page 8 fme us. Councilmember Wilson was very pleased with how engaged staff was with the auditors this year. There were recommendations and a timeframe brought to Council. Councilmember May asked if liquor operations are under Finance. Finance Director Walters replied it doesn't anymore. It is now under Administration. Councilmember May asked when that happened. City Administrator Herlofsky replied at the fIrst of the year when the Finance Director left. We were going to make the adjustment anyway and the timing worked out well. Finance Director Walters stated we are not going for the budget award this year. We are going for the CAFR award which is more important than the budget award because this award tells you what is coming, here is what needs to be changed, here is what you are doing right, and being able to read the fmancial statements. Ifwe had a 2% increase we could include the budget award. Ifthere was an increase to the budget, there could be salary increases and we could move the Accountant to an empty office for productivity so we would need a desk, and there could be additional training for staff. Mayor Larson felt we should move the Accountant anyway to an office. Police Administration - 66% of this budget is salary. A 5% decrease would have to be part time personnel. Services and supplies includes $269,000 for fees to LOGIS, municipal services, lega~ and CHIN which we have to have to operate. We could cut supplies by $9,900. Councilmember Wilson asked if the services and supplies category could be reviewed further in the way we contract for services. Human Resources Director Wendlandt stated some of it is LOGIS records management, and we have gone with CHIN where we will see a cost savings. Patrol Services - The majority of this budget is wages. A 5% decrease would have to come from staff reductions. In order to fulfill the necessity in patrol we would have to pull someone from the School Resource program. The school does pay salary and benefits for 9 months ofthe year. The overtime budget for 2010 was $82,434. As of June 30,38% has been used so we could reduce that budget to $80,000. Overtime covers court costs and in-house training. City Administrator Herlofsky noted we have outfitted the cars with video cameras which should cut back on court time. Councilmember Fogarty asked if it helps with the liability insurance to have the cameras. Staffwill research this. Sgt. Murphy stated we could also reduce uniforms, equipment, and supplies by $8,800. The police receive $750 for uniforms. They receive a check for a uniform allowance. Investigations - 96% of this budget is salaries so there is no where to cut. They will watch the budget and cut where they can. They have saved some overtime by shifting schedules and trading days. Councilmember Wilson noted we have budgeted two new patrol cars for this year and we are on a schedule. He asked what would happen ifwe delayed this year's purchase. Sgt. Murphy stated we did not replace one car this year because the mileage was still low enough. The higher the mileage the more things break and it spends more time in the shop and the use is put on another vehicle. It takes 3-6 months to get a new vehicle. City Administrator Herlofsky stated we did reduce the number of new vehicles for 2010 from three to two and now for 2011 we are keeping it at two. Sgt. Murphy stated we order the cars and our mechanics outfit them. 17 Council Workshop Minutes July 26, 2010 Page 9 Fire Ifthere is a reduction, it would have to be staff. For a 2% cut it would mean two paid on-call personnel. The average salary paid, training, turnout gear and uniforms comes to $5,073/member. Currently we are authorized for 52 members. If that requirement is changed, the pension requirements would change also. So there would be some benefIt. For a 5% reduction, it would mean cutting fIve members. Currently we are fIve members short, we have 47 paid on ~all and one full time and we are getting by. This could lead to some daytime issues. A 2% increase would provide money for the VoTech defensive driving training. A 2% increase would also provide for some upgrades to station 1. A 5% increase would provide for an Assistant Chief s vehicle, increase the training, equipment and supplies, and upgrades to station 1. Parks and Recreation Park Maintenance - A 2% decrease would reduce supplies to maintain ballfIelds and parks. A 5% decrease would be a reduction in part time salaries by $13,638 which would include closing the warm houses, we would still have outdoor ice, and reduce the number of seasonal staffhired in the summer. The impact of this would mean using full time staff to do mowing in the parks, which would reduce facility repairs, maintenance of playground equipment, response times to remove graffiti, landscaped areas would not look as nice as they do now. We could terminate the lease of the skidster and share it with the street department. A 2% increase would increase salaries for seasonal staff and purchase more fertilizer and herbicides for parks. A 5% increase would involve salary increases, additional fertilizer and have a capital outlay to purchase a new trailer to haul mowers and equipment to parks and trails. Recreation Programs - Staff split the budget into a program budget and an administrative budget. Parks and Recreation Director Distad reviewed the program budget. A 2% reduction would eliminate the puppet wagon and the tots and tykes programs. Eliminating programs would eliminate revenues. A 5% reduction would be the same reductions plus reduce program expenses which means not buying new equipment for programs. A 2% budget increase would increase salaries for seasonal staff who have not received a pay raise since 2008, add outside printing for more marketing ofprograms, and equipment for programs. A 5% increase would be the same items plus offering new programs and increase outside printing for broader marketing, purchase more ads in local newspapers, increase amount of new equipment to replace aging equipment. Councilmember Wilson asked about the trend for the programs. Some programs have been cancelled because numbers were down. Some time slots have been combined for programs to still run the program. Ifthe money is not there to cover the cost ofthe program, we do not run it. Overall the numbers are down. Councilmember Wilson asked how the collaboration with the school district has worked out. Staff stated we do some of the CEEF programs jointly such as the Halloween Walk and Dew Days. Councilmember Wilson asked if staff and the school have talked about doing joint marketing. Parks and Recreation Director Distad noted the City's brochure goes out earlier because our programs start earlier in the season, so it has not worked out for timing. Councilmember Wilson did not want to see park maintenance costs reduced, but perhaps some programs could be eliminated and spend more money on programs that are doing well. Mayor Larson asked if there was a way for the City and the school to share equipment. 18 Council Workshop Minutes July 26, 2010 Page 10 Staff stated there is an agreement to share maintenance equipment if something breaks down. The issue is maintenance needs to be done at the same time so both entities need equipment. The issue comes down to timing, so sharing equipment is not possible. Administration - This covers times for the Parks and Recreation Director and the Senior Center Coordinator. A 2% reduction could be made in office supplies, reduce fuel by reducing the number of visits to programs. Right now we check on the programs daily. Mayor Larson stated seasonal staffruns the programs, so he felt someone should be checking everyday. Uniforms have been cut, electricity for the sign on Denmark has been cut, dues and subscriptions for NRP A and MRP A for the Parks and Recreation Commission. Cut training in half. Some staff are certified and there could be some loss in certification. Reduce mileage, advertising in the Community Guide and handouts at the Expo would be eliminated. Cell phones would be eliminated. Reduce the number of brochures from three to two. Two years ago we had four brochures. Councilmember Wilson stated reducing the brochures would not concern him, as he would go online for registration. He asked if eliminating the brochure or printing a smaller number would work. Parks and Recreation Director Distad stated Eagan tried that and they received a lot of calls wanting the paper brochure. So they have gone back to paper. With a listserve we could send out an e-mail notifying those who have registered previously that the brochure is online. Some people still come to City Hall to register. Parks and Recreation Director Distad stated another 2% budget increase would be a salary increases for full time staff and supplies. A 5% increase includes a salary increase, supplies, and upgrading the paper quality of the brochures. Increase advertising to promote services. Councilmember Wilson felt uniforms should not be reduced as staff should be identified. He would not support reducing $1,000 in training unless it did not directly impact maintaining a certification or license. Municipal Services Streets - A 5% reduction would include traffic sign replacement, minimal blacktopping for seal coat, dust coating, alley and gravel maintenance, not hire a budgeted part time employee. A 2% reduction would be to not hire a budgeted employee. This position has not been filled for the last three years. A 2% increase would allow for more black topping, buy more materials, more alley and gravel road maintenance. A 5% increase, nothing more could be done than the 2% increase because we do not have the time and personnel to do it. Snow - This depends on the weather. Last year we were at $80,000 for salt. One year we were at $135,000 for salt with an $80,000 budget. Councilmember Wilson has been frustrated with previous Councils where we have debated how we should remove snow. If it snows, we need to get rid of it. Councilmember Fogarty stated it is a public safety issue. There are basic services a government provides. Staff receives calls why are you wasting taxpayer dollars and other calls that residents are paying for snow removal and want it done. City Administrator Herlofsky noted staff is concerned with the possibility of the county moving from hwy 50. Municipal Services Director Reiten stated it would be approximately $100,000 for a salt storage building at the Maintenance Facility site. Mayor Larson felt we should look at this soon, but not this year. 19 Council Workshop Minutes July 26,2010 Page 11 Councilmember Wilson asked if there was a way to manage time during the spring and summer knowing there would be overtime in the winter. Staff stated it varies and depends on when the snow falls. Human Resources Director Wendlandt noted to manage staff they also allow only one person at a time to take vacation in the winter. City Administrator Herlofsky stated we also use other employees for plow operators. City Administrator Herlofsky asked about scheduling a budget workshop in August, either the 23ro or the 30th. At the August 2, Council meeting Council could have a slight discussion on the budget for any items Council would want for the workshop. Mayor Larson suggested August 23. City Administrator Herlofsky reminded Council it is critical a levy is approved in September. You can reduce it after September, but you cannot increase it. Mayor Larson asked if Council wanted to review this information, discuss it at the August 2, Council meeting as to what they want to see on August 23. Councilmember Fogarty asked if Council needs to see any more on August 23; it seems Council needs more of a discussion on August 23. We have all the information we have asked for. Now it is time for Council to talk about what we want to see cut or increased. She was not sure anything needed to be on the agenda. City Administrator Herlofsky stated on August 23, we will have an EDA meeting at 6:00 p.m. and a Budget Workshop at 6:30 p.m. We can leave August 30, open if things are not resolved on August 23. Councilmember May stated she took notes on each department and asked if Council wanted to share them with each other ahead of time. City Administrator Herlofsky stated Council can send the notes to him and he can disseminate them to Council so everyone is getting the same thing. Councilmember Fogarty agreed with that. Councilmember Wilson had some additional comments. Somewhere between 1 % - 3% with some of the departments there are things that are not a critical need. To save time, there are a few efficiencies that could be found. Certainly $75,000 - $100,000 could be found. He would not mind having staff go through their budgets and determine what is realistic because he will need to see reductions. The reductions he is considering are much more drastic than what he is seeing. He would like to see a consolidation from staff of all the different departments. Councilmember Fogarty had some ideas from things that occurred tonight. Such as the part time employee not in the budget, some things from Engineering. She was not concerned with having plan reviews done quickly. She has heard residents would rather see services cut than taxes increased. On the other side, when it comes to Building Inspections we cannot slack on that. She suggested cuts in Engineering and increase in Building Inspections to reduce the response time. She liked the idea of Council sending in their notes and staff collating them. Then staff would also have the information, which she is very comfortable with. Councilmember Donnelly stated a 5% budget cut is $420,000. Nothing here added up to $420,000. Finance Director Walters stated the cuts by each department add up to that amount. Councilmember Donnelly stated but some of these cannot be done, so they are not realistic. He asked where the tax impact levy numbers came from. Finance Director Walters stated this was the levy from the previous meeting. Councilmember Fogarty stated but we cannot do that budget. Finance Director Walters explained we used that budget in order to do the reductions. 20 Council Workshop Minutes July 26, 2010 Page 12 Councilmember Fogarty clarified the no increase is a higher number than what was received tonight. The increase or the decreases would still be accurate. Finance Director Walters stated if everyone wants the $14,500 part time employee cut, then she could cut that so Council could see the impact of what everyone has cut. Councilmember Wilson asked staff to confIrm the foundational assumptions that were made before this document was given to Council. Was everything on the table, or was it to try to identify cuts that don't have a potential impact to the fund balance or staffmg. Finance Director Walters stated it was left to the discretion of each department. City Administrator Herlofsky noted that is what Council requested and that is why there are different formats. Finance Director Walters asked if a time should be set for Council to send comments to staff. Councilmember May stated they are just discussion items so she was trying to shorten the meeting for next time. Finance Director Walters stated it would help staff to put something together. City Administrator Herlofsky stated the Finance Director will ask at the August 2, Council meeting. Councilmember Fogarty will have her comments in by the end of the week. MOTION by Fogarty, second by Wilson to adjourn at 9:37 p.m. APIF, MOTION CARRIED. Respectfully submitted Cynthia Muller Executive Assistant 21