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<br /> MINUTTS <br /> CITY COUNCIL <br /> APRIL 14, 2010 <br /> years. The City Administrator indicated that the Fwrd is in good financial <br /> shape, but would likely not be able to support the aggressive program that <br /> has been in place the last few years. "the Administrator noted that in <br /> addition to the need to replace/overly streets in poor condition, the City <br /> took advantage of the competitive bidding climate to get this needed work <br /> done at substantial savings. <br /> The Council discussed their rational for increasing fi•anchise fees rather <br /> than property taxes. It was noted that in 2003 the State put levy Limits in <br /> play. The City Administrator pointed out that the use of franchise fees <br /> shifts more of the burden to commercial rather than residential. The <br /> franchise fees on electric also provide a funding source for burying of <br /> powerlines and support to the Infrastructure Fund. The City Administrator <br /> also noted that many cities have storm water and street lighting utilities. <br /> Little Canada does not. The Finance Director also pointed out that the <br /> franchise fee is not exposed do cuts by the State. <br /> The City Administrator indicated he believed there is a maximum limit on <br /> franchise fees, that being 5% of the electric bill. The Administrator <br /> pointed out that Xcel Energy administers the collection of the franchise <br /> fee. He also indicated that he would check with Xcel to determine the <br /> percentage that the proposed increase would result in. <br /> The City Administrator indicated that as of this evening it appears to be a <br /> wait and see situation as to what the Legislature will do with LGA and <br /> MVHC relative to their work to balance the current biennium's budget. <br /> Keis noted discussions that the Council had at the last workshop relative to <br /> personnel, and asked if staff reductions should be pursued. The City <br /> Administrator noted that the City already operates with a very lean staff <br /> and noted that layoffs and the resulting unemployment compensation the <br /> City would be liable for negates any cost savings for at least one year. He <br /> suggested that there may be opporCunities in the next couple of years to do <br /> some restructuring. <br /> With regard to a decrease in Council salaries, the Administrator noted that <br /> that had not been implemented and it was agreed that such a decrease <br /> would be postponed until such time as it was necessary. <br /> McGraw asked the status of the 2010 Budget. The City Administrator <br /> estimated that the City will need to use about $40,000 in reserves to <br /> balance the budget. However, based on recent legislative action and <br /> discussions this evening, there will be a surplus in 2011 that the City could <br /> then pay back reserves. It was also noted that LGA received for 201 I <br /> could be used to fund a new fre truck. The Administrator pointed out, <br /> however, that there would be an ongoing need to budget $111,000 <br /> 4 <br /> <br />