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APPROVED COUNCIL MINUTES DECEMBER 9, 2002 •1 is about $160,000, goes into the General Fund, and is used to maintain those roads. He advised that 2 several other minor State aids are also received. 3 4 Councilmember Carlson asked if the road projects would be delayed should the MSA funding be 5 reduced. Finance Director Rolek stated that could impact the City's planning for those road projects 6 but it is still too early to know what the State will do with MSA funding. He stated that once the City 7 knows what the Legislature proposes, an adjustment could be made. 8 9 Councilmember Carlson stated the roads need to get done but if absolutely necessary, they could be 10 delayed. However if State funding is lost in other areas, the City is already at the maximum levy so 11 other budget items would have to be cut. 12 13 Finance Director Rolek explained that if State aid is lost there will be a definite impact to the budget 14 and action will be needed to reduce the budget. He advised that staff is in preparation for that and has 15 held discussion of various options should the State reduce any aids. However, at this point it is not 16 known what the impact will be, if any. 17 18 City Administrator Waite Smith explained that the management team has been looking at the budget 19 and is putting together plans that are layered so if the cuts equal a certain amount, then the first layer 20 of cuts would take effect, with subsequent deeper budget cuts should that be needed. She stated staff 21 will continue to refine that plan since it is anticipated there may be some cuts. Staff is being proactive 22 in considering what could happen. • 23 24 Councilmember Carlson stated a cut would not decrease taxes to citizens but would reduce services 25 the City provides. Finance Director Rolek stated that is correct and noted the budget proposal 26 contains no new personnel for 2003. 27 28 Councilmember Dahl asked if the $150,000 MSA is for maintenance or reconstruction. Finance 29 Director Rolek stated the City receives two sources of MSA, one for reconstruction but that is not 30 received until the reconstruction project is undertaken. The City also receives a certain amount of 31 funds for maintenance, overlays, patching, sealcoating, etc. Those dollars go directly into the General 32 Fund and are incorporated into the maintenance programs. 33 34 Councilmember Dahl asked if the reconstruction funds are over and above the mentioned $150,000. 35 Finance Director Rolek stated that is correct. 36 37 Councilmember Dahl asked if the reserves roll over every year. Finance Director Rolek stated it is a 38 roll-over and an accumulation from the day the City was incorporated. 39 40 Mayor Bergeson opened the public hearing at 6:27 p.m. 41 42 No one came forward to address the 2003 Operating Budget and Property Tax Levy. 43 Ai 44 Finance Director Rolek recommended the public hearing be closed at this point and the time and date 45 announced when the 2003 budget levy will be finalized. 3