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HomeMy WebLinkAbout09.10.07 Work Session Minutes Council Workshop Minutes September 10, 2007 Mayor Soderberg called the meeting to order at 5:30 p.m. Present: Also Present: Soderberg, Fogarty, McKnight, Pritzlaff, Wilson Peter Herlofsky, City Administrator; Robin Roland, Finance Director; Brian Lindquist, Police Chief; Randy Distad, Parks and Recreation Director; Lee Mann, Public Works Director/City Engineer; Kevin Schorzman, Assistant City Engineer; Todd Reiten, Assistant Public Works Director; Rosemary Swedin, Accountant; Cynthia Muller, Executive Assistant MOTION by McKnight, second by Pritzlaffto approve the agenda. APIF, MOTION CARRIED. Council asked for a budget with no increase in the rate, however after review it was very difficult to do this. Staff wanted to make sure Council was aware ofthe areas in need of additional funding. Councilmember McKnight asked for the average building permit cost. The average is $2100. Single-family in 2006 was $3,166; in 2007 it was $2,200. Multi-family in 2006 was $1,900; in 2007 it was $1,240. Councilmember Wilson asked various questions regarding building permit numbers and felt the budget for building permit revenues is too low. This year commercial and industrial permits are included in the budgeted amount, however it is very conservative. Councilmember Pritzlaff asked how many building permits are budgeted for 2008. Finance Director Roland noted there are 150-180 single and multi-family permits and 15 commercial and industrial permits based on the Building Official's estimates. During the last budget workshop Council asked staff to reduce the amount of building permit revenue, so staff reduced it by $58,000. Councilmember McKnight was comfortable with the building permit numbers for 2008. Councilmember Pritzlaff asked about overtime. He asked about the fulltime overtime for the liquor stores and thought employees had set hours. Between the two stores there was $8,000 in overtime. Finance Director Roland noted it is based on history and the stores are short staffed for fulltime help. During the holidays fulltime employees do put in overtime. Human Resources Director Wendlandt noted when fulltime employees call in sick, if part-time cannot work, then fulltime has to work overtime. This also includes coverage for vacations. City Administrator Herlofsky noted the City is interviewing for a Liquor Manager and fulltime Clerk. Overtime should be a good thing, because we should see the result in operational revenues. Overtime is also paid for working on a holiday. Councilmember Pritzlaffnoted in the general fund in 2007 $100,000 was budgeted and it is now at $109,000. Finance Director Roland noted snow plowing is $12,000 over budget. This is due Council Workshop Minutes September 10, 2007 Page 2 to calling employees in to do plowing. Overtime is paid for call backs. This is done to provide the 8 hour service for plowing. City Administrator Herlofsky noted having $15,000 - $20,000 in overtime for plowing is still manageable. There is a difference in cost whether the snowfall occurs during the week or on the weekend. Councilmember Wilson noted in looking at the patrol portion, he asked if it would be better to hire another patrol officer rather than have overtime costs. Police Chief Lindquist replied the overtime amount is 2/3 the cost of an officer. One additional officer may not fulfill the needs. Even with an additional officer, staff would still budget for $50,000 in overtime. It is not so much the shifts that have to be covered, but there were two events this year that cost $15,000- $16,000 in overtime. A third event would be the safe and sober which would cost $8,000- $9,000, which is reimbursed from the federal government. Another event is the Citizens Academy which costs $2500 - $3,000. Another officer would reduce the overtime by 20%. Overtime is also paid when officers are called to court or for continuing education. Councilmember Pritzlaff asked about overtime for sewer and water. Finance Director Roland explained those are call outs for specific events for employees who carry a pager. If there is a sewer backup, sewer collapses, or events that happen after 3 :30 p.m., employees receive a minimum of 2 hours call out pay. City Engineer Mann noted employees are also called to construction projects for inspection or water testing beyond their normal hours. City Administrator Herlofsky noted overtime is the least expensive rather than hiring more people. Councilmember McKnight noted there was a change in allocation of liquor operations profits. He asked why staff is proposing that and where are the former ice arena profits going. City Administrator Herlofsky replied he would like to have more money in the general fund directly from the liquor store without having to tax. On the issue with parks, he wanted Council input. If another $40,000 - $50,000 can be added to the general fund, then the City does not have to tax for that amount. Council had asked to improve the general fund balance without raising taxes, so this would help over a period oftime. The City needs to look at park development. For all the parks we currently have, we are staffed appropriately. Every time a park is developed, Council has to look at appropriate staffing to go with it to maintain the parks. Mayor Soderberg noted he has told residents the liquor stores are operating because it helps to fund the parks. This somewhat satisfies concerns, as some people would rather not have the City involved in the liquor business. Ifwe are not going to use 50% to fund the parks where will the money come from for parks? City Administrator Herlofsky noted as far as the arena, with increasing fees and better management staff is looking for it to be self-supporting. If the money goes to the general fund, it still can be used for park maintenance. Council preferred the liquor store profits be transferred directly to parks and the pool rather than the general fund. Finance Director Roland noted prior expenditures for the pool and Rambling River Center in 2005 were $243,000 and $259,091 in 2006. Budgeted for 2007 and 2008 is significantly more than staff is actually spending. Ifwe spend at the same level as 2005 and 2006, that number will be in the black. If $250,000 is spent then there will not be the deficit shown in 2008. There is a higher budgeted number than what will actually be spent. Staff has not reduced that number significantly, and therefore it shows a deficit. When that money is actually spent staff estimates it will be about $70,000 less in expenditures. Mayor Soderberg noted it has been policy for 50% of liquor store profits to go to parks. Parks and Recreation Director Distad noted with regard to future park improvements, development dollars will be drying up so we need to look long term at how to fund park improvements. Eventually the City will have to address deficiencies in older Council Workshop Minutes September 10, 2007 Page 3 parks. Councilmember Pritzlaff stated he does not expect more than one or two developments this year, but we already have developments that are expecting a park, so do we have the money to build parks in current developments. Staff noted there are only two parks not developed. The City should be caught up after next year except for Hill Dee. Councilmember Pritzlaff felt the City needs to look at whether we can maintain the amount of trails we have when adding trails. Councilmember McKnight then asked about new positions and noticed there are still a couple new positions in the budget. Finance Director Roland stated in the general fund there are three positions. There is a shared position between Human Resources and the Fire Department, an upgrade to Administrative Sergeant in Police Administration, and a Detective. Human Resources Director Wendlandt stated Fire does not have any administrative support. The Fire Chief is paid on-call and has many duties so the City depends on the officers for clerical support. There is some City Hall staff that helps out. Ifthey had support it would help Human Resources and Finance as a lot oftime is spent helping them with payroll and financial reports. The Human Resources support is due to issues with changes in the employment law environment. This person would do payroll and would free up time to work on COBRA, vets preference inquiries, ADA compliance issues, etc. City Administrator Herlofsky noted the Human Resources department also includes IT. In other places payroll is a finance function. There are 110 full and part-time regular employees. With the Fire Department there are 160. This does not include seasonal employees. Councilmember Wilson felt some of these items mentioned could be under professional services. Human Resources Director Wendlandt explained the various testing requirements, grievances that go to arbitration, citywide training, reports on pay equity, employee assistance programs all come from professional services. Police Chief Lindquist explained the positions for the Police Department. This is the third year an additional detective has been requested. According to Stanton 6 surveys, Farmington is behind the curve as far as investigators. When the shooting took place this year, there were also other cases that needed attention. A patrol officer was transferred to investigations for two months. With the projected population at the new school and the increase to the youth population statewide, to avoid putting another detective on right now would compromise the City's ability to successfully prosecute investigations in the future. We currently have a success rate of 60% which is the highest in the county. Currently the department is working on 15 cases. One event could set them behind and the department would not be able to catch up. A matter of case load and manpower and the ability to investigate and solve the crimes is pushing the Detective position. This would be a promotion from patrol and would require a backfill. An Administrative Officer would be shifted to Administrative Sergeant and there would be no backfill. The Administrative Sergeant was approved last year, but staff did not go forward. A patrol officer was put into an administrative position. This position maintains training records, budget expenses, works on grants, etc. This position carries a rank with it as it is a supervisory position. The change has made things much more efficient. Councilmember McKnight stated the current levy is 11.9%. The levy increase is 4.5%. This is the impact of new construction and TIF districts coming back on. Councilmember Fogarty noticed there are a couple departments that show no increase in staffing, but there is more than a 3-4% increase in salary. This is due to step increases. Part-time salaries in 2006 were $73,000; there is $69,600 for 2007 and $63,700 for 2008. There is ajump in fire pension aid. The Rescue part-time salaries budget was increased because there are more rescue calls and an increase in the number of officers. Mayor Soderberg asked if the City has addressed Council Workshop Minutes September 10, 2007 Page 4 the ability for the Fire Department to receive training. City Administrator Herlofsky noted with the DCC in operation, staffwill be looking at what is really needed and what is extra. Councilmember Fogarty noted in the 2008 budget there is $100,000 in improvements at the ice arena. She asked if they could be put off. The next two years there is $750,000 of investment into the building. We will need the building for the next five years, but asked if it could wait until other options are reviewed. Parks and Recreation Director Distad stated over the next five years we do not need to replace anything. After five years we will know if there will be a new facility. Councilmember Fogarty asked if this money would be coming from the general fund. Finance Director Roland replied funding sources have not been identified. Staff has discussed increasing fees and reducing costs. City Administrator Herlofsky noted effective January 1, 2008 the ice arena rates will be increased to $200. The Parks and Recreation Commission recommended $185. Currently the rate is $170. Staff is doing an excellent job of allocating costs and tracking expenses by month. The arena can last at least five more years. Staff will be meeting with the school district and the hockey association in the next couple years to determine what the needs are. The 2008 budget was based on $1 85/hour. Councilmember Fogarty noticed there is a decrease in staff at the arena yet an increase in salaries. Finance Director Roland noted there are a number of people in the step process. Councilmember Fogarty asked about capital outlay. The vehicles are for the Fire Chief and Assistant Fire Chief and are replacement vehicles. Councilmember Fogarty agreed they are underestimating the building permit revenue, but was comfortable with the numbers. Councilmember Pritzlaffnoted in 2009 there is $200,000 for a trailer to haul an ATV and snowmobile. Police Chief Lindquist noted the department has an ATV that is stored at the Fire Station. The trailer is to transport the ATV to the scene. Councilmember Pritzlaffnoted for the Director of Public Works, $2433 is listed five times. Finance Director Roland stated that is the way that person's salary is split. This amounts to a $12,500 increase for that position. Councilmember Wilson complimented Finance Director Roland on how the budget is presented. He asked if she could translate what the business units mean, such as Fire, Police, Public Works, etc. He also felt it would be helpful if in the first or second page of a departmental budget there was a list capital outlay requests. Finance Director Roland noted in the final budget Council will see the narrative which will include a list of capital outlay items. Councilmember Wilson agreed with not shifting $50,000 from the liquor fund to the general fund. That will have a direct impact on the building permit offset. Finance Director Roland noted there would also be a reduction in expenses. Councilmember Wilson felt the building permit revenue is really low. A levy of 4.5% is not unreasonable, but a family budget is around 2.5 - 3.5% range. He felt government should try to grow at the same pace as someone's paycheck. It would be nice to have a full day workshop to better understand all the expenditures page by page. Finance Director Roland noted contracted services are different than professional services. The contracted services are the cost of the DCC for 2008. Councilmember Wilson asked about administrative support. His question was not as much as a necessity of the position, but he was curious why the Parks and Recreation Specialist was not in the budget. City Administrator Herlofsky stated the departments discussed positions and based on the Fire Department having no assistance at all, and the demands occurring in the human resources area, that seemed like a good place to provide support. He did not like funding positions in 2006 for only half a year. He would like positions funded for the entire year and ifthey are not used the entire year, that will be an advantage to the fund balance. The positions in the budget were considered more critical than the Parks Department. Council Workshop Minutes September 10, 2007 Page 5 Councilmember Wilson stated when an administrative support position is requested, that is a department saying we are not serving our customers as well as we could. His priority would not be to eliminate the shared position, but it would be to reallocate funds for that position. City Administrator Herlofsky noted the two people working at the reception desk are providing a lot of assistance for Parks and Recreation. Staff felt that would be enough to get us through the next year. Parks and Recreation Director Distad noted we do not have a lot of support staff in all departments. There are currently 2 ~ people running programs. Parks and Recreation Director Distad stated they have asked for this position for a number of years, but they are getting by with help from the reception desk. Councilmember Wilson asked if it compromised the ability to put on the type of programs they would like to. City Administrator Herlofsky stated ifthey had an additional programmer, they would put on more programs. Finance Director Roland added hopefully there would be additional revenue to go with those. Parks and Recreation Director Distad stated 35% ofthe Parks and Recreation budget is coming from revenues. City Administrator Herlofsky stated as you add another programmer you increase the liability on the other side. Councilmember Wilson asked if the additional money in IT was due to computer replacement. Staff noted it is computer replacement, switches, and routers. A new item is the tape library to provide a better backup system. The other new item is the redundant fiber link to LOGIS and the State. The third item is a scanning station for Public Works and Police. Finance Director Roland noted there is also $40,000 in increased maintenance agreements. Human Resources Director Wendlandt noted the Image Trend software for the Fire Department is a new item and Expressions is the new replacement software for the website. Councilmember Wilson noted the training budget went up 50% since 2005. He supported staff having the ability to have training, but asked about the amount of increase. Finance Director Roland stated the Fire and Police Departments are growing rapidly. There is a certain dollar amount for each officer. There is EMT training for the Fire Department. City Administrator Herlofsky stated he supports training as he would rather have less people well trained, than more people who do not know what they are doing. Councilmember Wilson would like to see the impact to the average home reduced by 2%. Mayor Soderberg would like to see the tax rate remain the same. This would amount to a reduction of $342,000, unless permit numbers are revised upward. City Administrator Herlofsky stated regarding the rate, the concern Council needs to look at over the next 2-3 years is the tax capacity will be affected by the value of the housing. Except for expansion, based on the current level of housing, he does not see the tax capacity increasing much over the next couple years. A small increase in rate each year is better than finding ourselves 2-3 years later having to make a larger increase. Weare almost entering what happens to a fully developed City where instead of the value going up, it holds steady or loses ground. The economy is not supporting growth. Very closely managed increases over the next couple years might be better than trying to hold it and in a couple years need to make a change. Mayor Soderberg stated with the exception to the change in allocation ofthe liquor funds, he was comfortable with the budget as presented. Councilmember Wilson asked how long the EDA would stay with a consultant rather than hiring an Economic Development Director. There is $30,000 in the budget for 2008 to continue with contracted services. City Administrator Herlofsky recommended staying with a consultant Council Workshop Minutes September 10, 2007 Page 6 through 2008. By the end of next year staffwill have 18 months experience with this. If everyone is not happy with the results, then we can put that position in the 2009 budget. At the next Council meeting the levy has to be approved. Council can always reduce the levy later in 2007, but they cannot raise it. Finance Director Roland noted at the first meeting in December Council will have the actual statements to see if the numbers are accurate and reflect the appropriate amount being taxed. Councilmember Wilson felt a budget should not have a dissenting vote. Mayor Soderberg was comfortable with placing this preliminary levy on the September 17, 2007 Council agenda. Councilmember McKnight was comfortable because he sees the true impact and the levy is 4.5%. He was not going to support staff positions, but was almost convinced on the investigative position. Councilmember Wilson would support the preliminary levy where it is, but would like staffto look at reducing it to 3%. Councilmember Fogarty was comfortable with the budget, but she would like to increase the building permit revenue. Councilmember McKnight suggested staff look at the entire budget to address revenue concerns. Councilmember Pritzlaff stated initially he was not in favor of new positions, was comfortable with Police and Fire and understood the City is short on staff. MOTION by Fogarty, second by McKnight to adjourn at 7:26 p.m. APIF, MOTION CARRIED. Respectfully submitted, ~p7~ Cynthia Muller Executive Assistant