Loading...
HomeMy WebLinkAboutAgenda 12-8-10 pages 1-29 CITY OF FALCON HEIGHTS Regular Meeting of the City Council City Hall 2077 West Larpenteur Avenue AGENDA December 8, 2010 A. CALL TO ORDER: 7:00 PM B. ROLL CALL: LINDSTROM ____ HARRIS ____ GOSLINE ____ LONG ____ MERCER-TAYLOR ____ MILLER ____ C. PRESENTATIONS: D. APPROVAL OF MINUTES: November 10, 2010 E. PUBLIC HEARINGS: 1. 2011 Budget and Tax Levy F. CONSENT AGENDA: 1. General Disbursements through 12/1/10: $265,767.61 Payroll through 11/29/10: $29,532.53 2. City License Application 3. Budget amendment to the Parks Program Special Revenue Fund (201) 4. Budget amendment to the TIF District # 1-2 (412) capital project fund 5. Transfer funds from Infrastructure capital project fund to the 2010 Larpenteur Streetscape capital project fund 6. Transfer funds from the general fund to the sanitary sewer fund for 2010 7. Resolution for SCORE Grant 8. Six month salary adjustment for Michelle Tesser 9. Budget amendment to fund 414 -TIF District # 1-3 SE Corner G: POLICY ITEMS: 1. 2011 Fee Schedule 2. City Hall Solar Panel Project Letter of Intent H. INFORMATION/ANNOUNCEMENTS: I. COMMUNITY FORUM: J. ADJOURNMENT: CITY OF FALCON HEIGHTS Regular Meeting of the City Council City Hall 2077 West Larpenteur Avenue AGENDA November 10, 2010 A. CALL TO ORDER: 7:00 PM B. ROLL CALL: LINDSTROM _X_ HARRIS _X_ GOSLINE _X_ LONG _X_ MERCER-TAYLOR _X_ MILLER _X_ C. PRESENTATIONS: 1. Jerry Hromatka, Northwest Youth and Family Services D. APPROVAL OF MINUTES: October 27, 2010 Approved E. PUBLIC HEARINGS: F. CONSENT AGENDA: Chuck Long 1. General Disbursements through 11/4/10: $121,368.40 Moved Approval 5-0 Payroll through 10/28/10: $13,973.67 2. City License Application 3. Recognition of 2010 Adopt-a-Crop Participants 4. Community Garden Special Revenue Fund 203 Budget Amendment G: POLICY ITEMS: 1. Approval of the City’s Housing Action Plan Beth Mercer-Taylor Moved Approval 5-0 2. Paint the Pavement Update Pamela Harris Moved Approval 5-0 H. INFORMATION/ANNOUNCEMENTS: I. COMMUNITY FORUM: J. ADJOURNMENT: 8:15 p.m. REQUEST FOR COUNCIL ACTION Families, Fields and Fair __________________________ Meeting Date December 8, 2010 Agenda Item Public Hearing E1 Attachment 2011 Budget Budget Introduction Letter Resolutions 10-17 and 10-18 Submitted By Justin Miller, City Administrator The City That Soars! Item 2011 Budget Hearing and Adoption Description Each year the city council is required to adopt a budget and tax levy to fund city operations. This action must be completed before the end of the year, and the adopted levy is then provided to Ramsey County so they can produce property tax statements for each parcel in the county. On September 8th, the city council adopted a preliminary levy and established December 8th as the date at which the public would be given an opportunity to address the council about the proposed budget and tax levy. This process is slightly different than past years due to the State of Minnesota revising truth-in-taxation hearing and notice requirements. Before the council is a proposed property tax levy of $1,038,292 and a general fund budget of $1,672,640. The tax levy is broken into three levies: ad valorem, debt service, and a levy to recapture a portion of the local government aid (LGA) that was unalloted in 2010. These levies and budgets are detailed below: 2010 Levy 2011 Proposed Levy % Increase (Decrease) Ad Valorem $894,562 $917,674 2.58% Debt Service $124,584 $72,300 (42%) Unallotment Levy $3,798 $48,318 1,172% Total $1,022,944 $1,038,290 1.5% 2010 General Fund Budget Proposed 2011 General Fund Budget % Increase $1,665,817 $1,672,640 .41% The impact of this proposed levy on a median valued home, which in 2011 is assessed at $254,550, is estimated to result in no change in the city portion of the property tax statement. A full presentation with more details will be presented at the city council meeting and will be available on the city’s website. In addition, attached to this report is the budget cover letter which goes into more detail about specific budget line items, factors influencing the proposed budget, and historical information. Budget Impact This budget preserves the core functions of the city’s current operations, yet also adds one summer public works laborer and publication of an additional city-wide newsletter. Attachment(s) 2011 Budget Budget Introduction Letter Resolutions 10-17 and 10-18 Action(s) Requested Staff recommends that the Falcon Heights City Council hold a public hearing and receive comment. Once the hearing is closed, staff recommends that the city council adopt resolution number 10-17 regarding the 2011 tax levy and adopt resolution 10-18 regarding the 2011 City of Falcon Heights budgets. December 8, 2010 Honorable Mayor Lindstrom And Members of the City Council City of Falcon Heights I am pleased to present for your consideration the 2011 City of Falcon Heights operating budget. This document is important not only as a budgetary tool, but also communicates to our residents, business community, and property owners the goals and priorities of the city for the upcoming year. The City of Falcon Heights is primarily a residential community situated near the center of the Minneapolis and St. Paul metropolitan area. The city is at or near full development, with the economy consisting of light industry, commerce, and agricultural related businesses. Economic conditions and employment remain stable with the University of Minnesota St. Paul campus, Hermes Floral Company, Spire Federal Credit Union, and the Minnesota State Fairgrounds providing a diversified economic employment base. FORM OF GOVERNMENT The City of Falcon Heights operates under the Statutory Plan A form of government, where the policy decisions are made by the city council, but the administrative duties are delegated to the city administrator. One of the primary administrative duties of the city administrator is to prepare an annual budget for approval by the council. BUDGET PROCESS In June, city staff start the preparation of their budget requests for the next calendar year (Falcon Heights' fiscal year is the calendar year). This is accomplished by correlating the city council’s budget goals (which are typically formulated during June) into financial projections, while at the same time, revenues are estimated for the next year. During July, the staff submits their budget requests for the general, special revenue, debt service, capital, and enterprise funds to the city administrator and city finance director. Budget requests are reviewed to determine if they are accurate, reasonable, and well justified. Staff requests are modified according to projected revenues. Once completed, a preliminary budget is prepared based upon initial revenue estimates, departmental budget requests, historical trends, and financial policies. In July, the city administrator and finance director meet with staff members individually. During these meetings, any recommended revisions are discussed and the city administrator makes the final decision as to what will be included in the proposed budget. The finance director uses this information to prepare the proposed budget document. In August, budget workshops open to the public are held where the city administrator presents the proposed budget to the city council. The city council reviews the proposed budget with staff, who then adjusts the budget for any changes the council recommends. In early September, the city certifies a proposed levy and budget to Ramsey County. The proposed levy is published and parcel specific notices are mailed to property owners. The council holds a public hearing on the proposed budget in early December and afterward approves the final budget. The city's property tax levy, which is necessary to finance the approved budget, is then certified to Ramsey County. Ramsey County collects the property taxes on behalf of the city as well as other taxing jurisdictions. 1-1 During the fiscal year, line items may be overspent as long as the total activity budget is not overspent. City staff may recommend changes in the activity budget to the city council, who can then approve or disapprove the amendment. The council may approve an activity to be overspent if funding is available, but may not amend the property tax levy. BUDGET ORGANIZATION The city's annual budget consists of five basic sections: 1. Introductory section 2. Governmental funds 3. Enterprise funds 4. Five-year capital improvement plan 5. Appendixes The introductory section includes the city's goals for 2011, fiscal policies and budget summary information. The governmental funds section includes revenue and expenditure history and projections from 2008 to 2011 for the general, special revenue, debt service, and capital projects funds. A fund is defined as an independent fiscal and accounting entity with a self-balancing set of accounts and resources which are dedicated for a specific purpose. The city uses the modified accrual basis of accounting for all governmental funds, in which revenues are recognized when they become measurable and available and expenditures are generally recognized when the related fund liabilities are incurred. Enterprise funds are those operated in a manner similar to private business enterprises, where the costs of providing services (expenses) are to be recovered primarily on a user-charge basis to the general public (revenues). The city uses the accrual basis of accounting for its enterprise fund (sanitary sewer, storm sewer), in which revenues are recognized when they are earned and expenses are recognized when they are incurred. The city's five-year Capital Improvement Plan (CIP) is a tabulation of projects and equipment that are being recommended with potential funding sources for each. A capital asset is defined as an expenditure which results in the acquisition or replacement of a fixed asset which costs $1000 or more and/or has a life expectancy of three years or more. The city uses the threshold level of $5000 to determine if the capital asset is listed in the general fixed asset account group. The five-year CIP is approved by the city council, but it is a planning document only and approval carries no appropriation authority. All appropriations are made as a result of the annual budgeting process. A glossary of terms is provided to assist in a better understanding of this budget. Appendixes include additional information to support underlying budget assumptions. 2011 BUDGET SUMMARY The 2010 State of Minnesota legislative session continued several policies that created challenges to city budgets. Most importantly, local property tax levies were capped at a 1.6784% increase over the previous year, with certain exceptions. For the most part, the allowable exceptions do not apply to Falcon Heights, so our maximum property tax levy is a fixed target. According to Minnesota Department of Revenue projections, the city is due to receive $439,554 in Local Government Aid in 2011. If this were to occur, it would be an increase of $129,428 over our 2010 LGA receipts (after unallotment actions taken during the 2010 legislative session). This would equal an increase of 41% 1-2 during a time when it is anticipated that there will be a $6 billion deficit facing the State of Minnesota when the legislature convenes in February. Personnel As in most government and service related organizations, the vast majority of our spending is the result of employing workers and their associated benefits. Health Insurance 2011 will be the second year where the city participates in the Public Employees Insurance Program. PEIP is a plan offered through the State of Minnesota to cities and other organizations throughout the state. The 2011 renewal rate is 16% higher that 2010 rate. Employees will continue to purchase other insurance coverages (dental, life, etc.) through Ramsey County. Personnel Costs We have included a 1% cost of living adjustment for regular employees in 2011. There were no cost of living adjustments in 2010. There are no new full-time employees included in the 2011 budget. There is an additional seasonal employee included in the public works department to help maintain the new streetscape features along Larpenteur Avenue. Individual Budget Summaries As was the case for the past few years, the economic outlook is still uncertain and it is unlikely that significant improvements will be seen in the near future. The State of Minnesota is not exempt from this downturn, and as such is projecting a six billion dollar deficit for the upcoming biennium, even after solving their most recent budget deficit during the 2010 legislative session. The areas below highlight department budgets where there are proposed expenditure cuts or major departures from the 2010 budget: Administrative: Full time deputy clerk and recreation supervisor positions have been replaced with a single assistant to the city administrator, whose duties and salary are split with the recreation budgets. Police: Reflects final year of two-year contract negotiated during 2009. Also reflects increase (as well as change in how we account for) in dispatching expenses associated with consolidated dispatch center. The increase in the police budget for 2011 totals $16,669. Street Maintenance: Reflects an increase due to additional seasonal employee. Expenditure Summary The proposed budget reflects an increase in expenditures of $6,823, or .41%. Revenues Local Government Aid (LGA) The city’s LGA allocation is theoretically supposed to increase by $129,428 over the final 2010 amount we received. However, due to the state’s budget deficit, it is likely that further LGA reductions will occur. The 2011 budget projects that LGA will remain the same as 2010. Licenses, Permits, and Charges for Services 1-3 Estimated 2010 revenues from building permits and licenses is roughly in line with what was anticipated in the 2010 budget. For 2011, staff is estimating a similar pattern, but we are budgeting about $1,200 less in permit and license fees. We also are budgeting about the same in other revenues such as facility rentals, zoning fees, and accident clean-up fees, but less in fines and forfeitures, which reflects recent trends. Transfer from Reserve Funds In order to provide a balanced budget, a transfer from reserve funds is needed in the amount of $71,917. Beginning with the 2007 budget, the city council had approved budgets that had reduced this amount with the goal of eliminating the transfer within a few years. The actual amount transferred in the past few years has been smaller than budgeted due to higher than expected revenues and lower than expected expenses. It is possible this could occur again in 2011, but this amount is needed in order for the budget to balance. Transferring money from capital and enterprise accounts to the general fund began in response to the 2003 LGA cuts the city was impacted by. Eliminating this transfer should be a goal of future budgets in order to protect the capital account balances and our bond ratings. Since 2006, the actual amount transferred from capital or other accounts at the end of the year has been less that what was originally budgeted. History of Transfer From Reserves to General Fund Year Budgeted Amount Actual Amount 2004 $135,676 $135,676 2005 $204,315 $204,315 2006 $229,832 $160,000 2007 $161,337 $4,000 2008 $113,797 $65,000 2009 $21,732 $0 2010 $112,400 $112,400 (estimate) 2011 $71,917 Special Debt Levy One of the special levies allowed by the state legislature under the levy limit legislation was for existing bonded indebtedness. The city annually paid principal and interest on bonds that were issued for the 1999 NE Quadrant street improvement project. The final payment on these bonds was made in 2010. However, the city council issued new equipment certificates certificates in 2010 to fund the acquisition of new public works equipment. The total bond issue was $300,000 for a term of five years. Favorable interest rates were received (under 3%) and the first payment on these bonds is due in 2011. $72,300 is being included in this special levy, which will be spread across all taxpayers in the city. Special LGA Unallotment Levy Another special levy approved by the legislature is one that allows cities to recapture LGA and Market Value Homestead Credit (MVHC) money that was unalloted by the governor or legislatively reduced. Our 2010 LGA and MVHC reduction totaled $158,001. The preliminary levy that was approved by the city council included a levy in the amount of $48,318 to replace a portion of our unalloted LGA and MVHC. Summary The overall general fund budget, including all expenses, revenues, and transfers, totals $1,672,640. This is an increase of $6,823, or .41% over the 2010 operating budget. The total tax levy is $1,038,290, which is 1.5% higher than the levy approved for the 2010 budget. This results in a city tax rate of 21.521%, and a resulting flat tax impact of on a median valued home (which in 2011 will be $254,550). 1-4 1-5 I believe it is a responsible budget that allows the City of Falcon Heights to continue to provide a high level of service at a very reasonable cost. When measured against other Ramsey County municipalities, Falcon Heights’ tax rate is very impressive: City Proposed 2011 City Tax Rate Falcon Heights 21.521% Arden Hills 24.603% Lauderdale 26.866% Little Canada 27.108% Maplewood 38.870% Mounds View 41.662% New Brighton 37.690% North St. Paul 29.016% Roseville 30.327% St. Paul 38.158% Shoreview 30.932% Vadnais Heights 25.072% White Bear Lake 18.108% These frugal tax rates are due to an aggressive budget philosophy that encourages sharing or contracting for services from neighboring government agencies. Some examples of these practices include:  Obtaining police services from the City of St. Anthony  Using the City of Roseville for city engineering services  Providing fire department services to the City of Lauderdale (allowing us to offset our expenses)  Sharing a building inspector and street sweeper with the City of Little Canada  Participating with seventeen area communities on technology related issues, such as phone and information technology services In closing, I wish to acknowledge the contributions of many staff members, especially Finance Director Roland Olson and Finance Intern Charlotte Stockstead for their tireless efforts in putting these documents together. Sincerely, Justin Miller City Administrator CITY OF FALCON HEIGHTS Council Resolution 10-17 December 8, 2010 ______________________________________________________________________________ RESOLUTION ADOPTING THE 2011 TAX LEVY BE IT RESOLVED that the City Council of the City of Falcon Heights authorizes the City to levy taxes in the amount of $1,038,290 for the year 2011; and BE IT FURTHER RESOLVED that the County Auditor should extend the tax levy in the amount of $1,038,290 for the year 2011. Moved by: Approved by: ________________________ Peter Lindstrom, Mayor December 8, 2010 LINDSTROM _____ In Favor Attested by: _________________________ HARRIS Justin Miller LONG City Administrator MERCER-TAYLOR December 8, 2010 GOSLINE _____ Against Subscribed and sworn before me this ____ day of ______________, 2010. ________________________________ Notary Public My commission expires:____________ CITY OF FALCON HEIGHTS RESOLUTION 10-18 DECEMBER 8, 2010 ______________________________________________________________________________ RESOLUTION ADOPTING THE 2011 BUDGET BE IT RESOLVED by the City Council of the City of Falcon Heights that the General Fund Operating Budget for the year 2011 in the amount of $1,672,640 and other Fund Budgets as listed are adopted. Park Program Fund (201) $46,166 Community Garden (203) $250 Water Fund (204) $10,354 Emerald Ash Borer (205) $60,794 Recycling Fund (206) $89,889 Community Development Fund (208) $3,700 Street Light Utility (209) $40,200 CERT/CCC May 2012 (211) $4,956 Citizens Corps (213) $3,990 1996 TIF Larpenteur Bond (316) $210,000 60 Equipment Cert. Series 2010A $72,261 General Capital Improvements (401) $4,100 Public Safety Capital (402) $176,100 Parks Recreation/Public Facilities Capital (403) $124,600 TIF District #1-2 (412) $176,840 TIF District #2-1 (413) $66,648 TIF District #1-3 (414) $170,600 Infrastructure Capital (419) $192,157 Capital Equipment 2010 A (424) $94,600 ___________________________________________________________________________________ Moved by: Approved by: ________________________ Peter Lindstrom, Mayor December 8, 2010 LINDSTROM ____ In Favor Attested by: _________________________ HARRIS Justin Miller LONG City Administrator MERCER-TAYLOR December 8, 2010 GOSLINE ____ Against Subscribed and sworn before me this ____ day of ______________, 2010 ________________________________ Notary Public My commission expires:____________ REQUEST FOR COUNCIL ACTION Families, Fields and Fair __________________________ Meeting Date December 8, 2010 Agenda Item Consent F1 Attachment General Disbursements and Payroll Submitted By Roland Olson, Finance Director The City That Soars! Item General Disbursements and Payroll Description General Disbursements through 12/1/10: $265,767.61 Payroll through 11/29/10: $29,532.53 Budget Impact Attachment(s) General Disbursements and Payroll Action(s) Requested Staff recommends that the Falcon Heights City Council approve general disbursements and payroll.