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HomeMy WebLinkAbout07.05.11 Special Council Minutes Council Retreat Minutes July 5, 2011 Mayor Larson called the retreat to order at 4:03 p.m. Present: Larson, Bartholomay, Donnelly, Fogarty, May Also Present: Cynthia Muller, Executive Assistant MOTION by May, second by Bartholomay to approve the agenda. APIF, MOTION CARRIED. Council was given a spreadsheet listing items from the previous budget workshops. The spreadsheet allowed the Council to set priorities and amounts to add to the 2012 budget, and how those increases would affect the tax rate and the tax impact to homeowners. Councilmembers reviewed the list of budget increases to recall discussions from the workshops. Councilmember Fogarty wanted to continue discussions on a fIre district. Mayor Larson has been meeting with Empire and Rosemount regarding a fIre district and they are very interested. Ifthere is a levy increase, residents would be able to see what portion of that is for fIre services. Rosemount has a ladder truck, but we would still need a pumper. It has not been determined when this fIre district would be formed. Councilmember May asked about the $11,389 increase for cleaning under park maintenance. There is a $24,000 decrease in City Hall. Parks and Recreation Director Distad came into the meeting to explain. The $11,389 is broken out ftve different ways. There should be 10% or $1,138 in park maintenance, 10% in streets, 25% each in sewer, solid waste, and storm water. The utilities pay for most of the cost at the Maintenance Facility. It is not in the list twice. Councilmember Fogarty asked why the cleaning for the Maintenance Facility is going up and City Hall is going down. Parks and Recreation Director Distad explained it is about the same number as last year. The $11,389 should not have been on the list and should have been spread out over the above ftve budgets. Councilmember Donnelly asked about the difference in the numbers on the list showing total general fund budget changes of$310,649 and the total on the spreadsheet being $255,563. Councilmember Donnelly noted the list on the spreadsheet was a wish list and even without that list we are starting with a 3% levy increase. Councilmember Fogarty understood the $162,000 equipment replacement fund would be a wash and now on the spreadsheet it is showing as an increase. Parks and Recreation Director Distad came back into the meeting to inform Council that under ROC the previous cleaning cost for the Maintenance Facility was $10,853 and under Coverall it is $11,132. Finance Director Walters came into the meeting to answer questions on the difference in the total amounts on the lists. She explained the $280,123 plus the IT for $30,526. The IT goes into each department individually. The $310,649 is the total increases from each department. The 13 Council Retreat Minutes July 5,2011 Page 2 $255,563 is the total with the decrease in debt service plus the increases. The $261,509 is the increase in property taxes. Add other increases for a total revenue increase of$264,809. Expenditures are being increased by $310,649. To get a net, revenues less expenditures will total ($233,973) which is the ftscal disparities portion. Last year we used this amount against the debt service. Ifwe receive the same amount offtscal disparities this year we will have the additional $233,973 because last year was a one time fIx for the debt service on Vermillion River Crossing. The reason we do not increase the levy as much as the expenditures is because we also had a $45,840 contingency last year. Councilmember May asked about the equipment and replacement fund and thought that was going to be kept in the mix. Finance Director Walters stated that is an option for Council. Mayor Larson conftrmed the $162,000 has been removed from the budget. Councilmember Bartholomay asked if funds to cover computer equipment were included twice. Finance Director Walters explained the $30,526 is for actual equipment we are purchasing in 2012. Each department will include a portion for IT. Council discussed the items on the spreadsheet list. Councilmember Donnelly felt it was impossible to have the tax rate increase over 5%. Councilmember Fogarty wants every department to look at savings such as the savings on the cleaning contract and the liquor store lease. Councilmember May felt we could not sell a tax rate increase without showing some cuts. Councilmembers noted the largest items are salaries and benefIts. Councilmember May was supportive of a Parks and Recreation Department because it adds value to the community. But if the senior center is not working right, then we should look at turning it into a community center. Revenues are going down. Mayor Larson suggested looking at the priorities on the spreadsheet and discussing cuts later. Councilmember Fogarty wants to see a plan for the deftcit for the Rambling River Center and the pool rather than just allocating money towards that deftcit. Regarding the fuel station and salt storage, Councilmember Fogarty wanted to know if staff has talked to Marshall Lines regarding fuel and what is our contingency plan if we are cut off from salt. She was not sure 15 years is a payback for savings in having our own facility. She also wanted to know what the City is currently paying per gallon and what we can buy gas for ifwe have our own pumps. Council wanted to wait for the new City Administrator regarding any Administrative staff positions. Council also wants a plan for the ice arena to reduce the deftcit and future use of the building. Councilmember Donnelly noted the spreadsheet started with a 3% tax increase rather than starting at zero. Other Councilmembers agreed it needs to start at zero. Council was having problems with the list of budget increases and felt staff needs to look at the list again. Council prioritized the eight items for maintenance and replacement of equipment and infrastructure. The top two priorities were funds to cover seal coating and trail maintenance. They also included part-time staff for Finance. These items amount to a 7.54% tax rate increase. Council discussed a use for possible additional ftscal disparities. They agreed to put 100% of excess ftscal disparities towards the EDA defIcit. Any excess funds should go towards any deftcit such as the senior center, pool or ice arena. Councilmember Donnelly stated it is hard to raise taxes without showing the residents something. Council wanted to put something towards street rehabilitation, but can't increase the tax amount any more. Council was nqt comfortable with a 14 Council Retreat Minutes July 5,2011 Page 3 7.5% increase. They have only been given increases, and need to see some decreases to the list. Council would like more explanation on the $255,563 in additions to the 2012 budget and wants staff to look at ways to save. Council has set priorities, but doesn't know what to do with them. They all agreed we need to start seal coating again and that wipes out everything else. Council was not sure they were ready for the spreadsheet, but the priorities are important. Staff needs to help fmd a way to fund them. If 5 or 6 priorities could be met with a 7.5% tax increase that would be different, but this covers 2.5 priorities. Council did not understand they would be starting with a 3% tax increase. They understood this could be the preliminary budget because it can be decreased. Councilmember Fogarty asked ifthere was a way to increase the utilities and have the increased amount go to a fund for seal coating. Mayor Larson has asked the City Attorney to look at that to cover the $350,000 for seal coating. It is easier to levy for street rehabilitation. Council wants departments to look at ways to save. MOTION by Fogarty, second by May to adjourn at 6:20 p.m. APIF, MOTION CARRIED. Respectfully submitted, Cynthia Muller Executive Assistant 15