HomeMy WebLinkAbout09-09-2019 Council Special Budget Work Session MinutesCITY COUNCIL WORK SESSION
APPROVED
I CITY OF LINO LAKES
2 MINUTES
3
4 DATE : September 9, 2019
5 TIME STARTED : 7:05 p.m.
6 TIME ENDED
7:50 p.m.
7 MEMBERS PRESENT :Council Member Rafferty, Maher,
8 Manthey, Stoesz and Mayor Reinert
9 MEMBERS ABSENT
None
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I 1 Staff members present: City Administrator Jeff Karlson; Public Safety Director John
12 Swenson; Community Development Director Michael Grochala; Finance Director Sarah
13 Cotton; Public Services Director Rick DeGardner; City Clerk Julie Bartell
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15 2020 Budget Consideration — City Finance Director Cotton reviewed her written report
16 that included information on preliminary property valuation figures from the County,
17 proposed levy increase and primary drivers for the increase, past council directions for the
18 2020 budget and an updated Gap Analysis based on staff s current proposed budget.
19 Noted elements of the current proposal:
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21 - $31,500 added back to Pavement Management;
22 Additional $280,000 from Closed Bond Fund; $20,000 from current reserve (she
23 explained demands on this year's contingency);
24 Resulting in a 5.32% increase to the tax levy ($535,102) and reduction to tax rate
25 from 41.817% in 2019 to 40,115% for 2020.
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27 Mayor Reinert asked for the year over year impact. A 2.ncrease in expenditures
28 was offered by Ms. Cotton. The mayor expressed surprise since he thought the goal
29 reduction would level the budget to no increase. He sees the recommended reduction is
30 coming forward $60,000 less than expected. Ms. Cotton said $100,000 from the Closed
31 Bond Fund was already counted — the use of cash on hand will total $580,000,
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33 The mayor noted that the levy dropped 8%but the rate only dropped 5% so he questions
34 that. Ms. Cotton explained that expenditures have only dropped $200,000.
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36 The mayor discussed the possibility of utilizing additional reserves. Administrator
37 Karlson noted that would require further reduction in costs.
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39 Ms. Cotton noted the amount of the proposed budget and that it will be covered by tax
40 revenue, other revenue and use of surplus/transfer.
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42 Council Member Manthey asked Ms. Cotton if she has any concern about increasing the
43 use of reserve/surplus. Ms. Cotton noted that this year the use of those funds is actually
44 going down and added that the use does soften some debt service coming on line and the
45 past few years revenue (valuations) has been increasing.
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CITY COUNCIL WORD SESSION
APPROVED
Administrator Karlson said staff would not recommend any additional surplus use
because that is a negative to start the next year's budget.
Council Member Rafferty asked and received clarification on the term of equipment
certificates — three years.
Mayor Reinert indicated that he sees the need to meet again.
Director Cotton remarked that the council hasn't spent much time ou the Water and
Sewer Enterprise Funds. She reviewed the funds and that the balance in those funds
remain quite high but that's appropriate because the city doesn't fully depreciate. Mayor
Reinert asked how much those funds are actually expending and Ms. Cotton noted for the
Water Fund, $1.5 million ($580 depreciation), and for the Sewer Fund $2 million. Mayor
Reinert asked Ms. Cotton to prepare a summary page drilling down further on those
funds, indicating the gap analysis for depreciation and how much it would cost (per
household) to cover that gap.
The Council concurred to meet on Wednesday, September 18, 2019 at 6:00 p.m.
The meeting was adjourned at 7:50 p.m.
These minutes were considered, corrected and approved at the regular Council meeting held on
September 23, 2019,