08-14-2013 Council Workshop Minutes

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MINUTES CITY COUNCIL AUGUST 14, 2013 2013. The Administrator noted that Ehlers financial runs project $190,000 annual bond payments on a $2.5 million bond. There was discussion about bond ratings with Ruff comparing Moody's and Standard & Poor's. He noted that the City has been using Standard & Poor's rating service. Montour asked the impact on the levy if the City levied a debt service amount of $190,000. The Administrator pointed out an $81,000 increase in the levy equated to a 3% increase in the budget. The Administrator pointed out that the City has been debt adverse for the past few years. He noted that the proposal to sell CIP G.O. Bonds and using depreciation to fund the bond payments is an issue of money management. Blesener agreed, noting that General Fund dollars would not be used to make the bond payments. The Council agreed that the process should begin in preparation for a CIP G.O. Bond sale, and that information should be made available to the general public explaining the City's desire to finance the Public Works garage project with these bonds. FINANCIAL The City Administrator noted that at the last workshop, the Council discussed WHAT -IF'S the fact that Local Government Aid (LGA) will increase by $148,975 to $344,818 for 2014 and that levy limits are in place for 2014. The Administrator reported that staff has put together six scenarios for the 2014 Budget, and based on the debt service associated with the new Public Works garage project, scenario #6 proposes a 3% special levy ($81,520) and then uses additional LGA ($30,601) to balance the General Fund. The Administrator noted that this scenario appeared to have Council support at the last workshop meeting. He also noted that many other scenarios are possible. The Administrator also noted that scenario #6 increases General Fund dependence on LGA in total dollars used. The Council reviewed the information provided, and Blesener suggested that City staff prepare 2014 Budget scenarios projecting both a 2% Gross Levy increase and a 3% Gross Levy increase. These scenarios will be reviewed at the 2014 Budget Workshop meeting in anticipation for adoption of the 2014 Preliminary Levy at the September 11, 2013 Council meeting. QUARTERLY The Council reviewed the quarterly financial reports submitted by the FINANCIAL Finance Director. The Administrator noted that these reports are part of REPORTS the City's Financial Management Policy. As this is the first attempt at formalizing quarterly reporting to the Council, the Administrator asked for comments and suggestions from the Council. 3