02-24-10 Council Minutes - Laserfiche WebLink

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MINUTES CITY COUNCIL FEBRUARY 24, 2010 State's actions completely eliminate LGA, there is still $57,500 in MVHC that the State could take, and the Adminish~ator felt that given the State's Budget crisis that will happen. The City Administrator pointed out that the State has a $1.2 billion deficit that it has to make up by the end of June and another $Sto $6 billion deficit to make up for the next biennium. The City Administrator recommended that the Council call for a workshop on March 8, 2010 at 6:00 p.m. to plan for the impacts that the State's budget crisis is having on the City. He indicated that City staff will put together a listing of recommendations to address these reductions for Council's consideration. The Administrator then reviewed the impact to the City's tax levy if the $243,584 in State cuts were levied back. He noted that the City's tax rate would increase to 25.355 and the City would move from 5`" lowest taxing city in Ramsey County to about 7`~' lowest (which is where Little Canada has historically fell the previous few years). The result would be an approximate 10% increase in City property taxes. The Administrator then reviewed the State's actions relative to LGA and MVHC on surrounding cities. The Administrator pointed out that the good news is that the State only has $57,500 in MVHC that it could take and force the City to absorb. However, the State could always look for new revenue sources that could negatively impact cities. Keis pointed out the City's recent commitment to improve Thunder Bay Park at a cost of $37,500. He asked if it were possible to postpone that improvement. The City Administrator stated that capital items are an option, but was not sure that would help the City's operating budget given that capital items are one-time expenditures. With regard to Thunder Bay Park, the Administrator noted that LCRA is willing to share in the cost of this park improvement. He indicated that it may be feasible to slide the replacement of trucks and equipment back on the schedule, however. With regard to on-going, operating expenses, the City Administrator pointed out that in addition to the State impacts, building permit revenue is down, interest earnings are down, and 10% Fund revenue is down. The Administrator felt that the City will need to make fundamental changes in its operating costs. The Administrator reported that the Canadian Days Committee has asked about fireworks for the 2010 Canadian Days Celebration. The Administrator noted that the City pays for fireworks from the 10% Fund, which is money collected from charities based on their net profits for 13