HomeMy WebLinkAbout08-12-2024 - Council Special Work Session MinutesLino Lakes City Council
Special Work Session
Minutes
DATE: August 12, 2024
TIME STARTED: 7:11 P.M.
TIME ENDED: 8:43 P.M!
LOCATION: Community Room
MEMBERS PRESENT: Mayor Rafferty, Councilmembers Cavegn, Lyden, Stoesz and Ruhland
MEMBERS ABSENT: None
Staff Members Present: City Administrator Sarah Cotton, Finance Director Hannah Lynch, HR &
Communications Manager Meg Sawyer, Deputy Director/Fire Dan L'Allier, City Engineer Diane
Hanke, and Community Development Director Michael Grochala
1. Call to Order and Roll Call
Mayor Rafferty called the meeting to order at 7:11 p.m.
2. Setting the Agenda: Addition or Deletion of Agenda Items
The agenda was adopted as presented. The Finance Director provided a review of the
presentation schedule for this evening.
3. 2025 Annual Budget and 2025-2029 Financial Plan
The Finance Director stated that a 2025 Annual Budget and 2025-2029 Financial Plan are
being provided for the City Council's review this evening. The drafts were prepared by
department directors and reviewed by the City Administrator with the intention of
providing the resources needed to continue city services at their current levels.
The 2025 Annual Budget includes a total tax levy of $15,906,535 which represents a
$1,785,607 or 12.65% increase. With a smaller increase in tax capacity values, the city
tax rate is proposed to increase from 36.098% in 2024 to 39.857% in 2025. Detail behind
the total tax levy increase can be found in the draft 2025 Annual Budget.
The 2025-2029 Financial Plan was prepared in compliance to and in accordance with the
Lino Lakes City Charter Section 7.05. The Transmittal Letter, included in the report, gives
a full overview of the Plan. The Financial Section focuses on all city funds, while the
Capital Improvement Program (including Appendix A and B) focuses on the capital
project and enterprise funds. The Project Detail in Appendix A appears as follows:
1. Project Type
2. Project Year
3. Project Name
The Plan has two Capital Improvement Programs: Citywide and Community
Development. Citywide capital expenditures are reviewed during the annual budget
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process and approved when the plan is accepted by the City Council. Community
Development projects are brought to the City Council as projects occur and may go
through the competitive bidding process.
General Fund
Total 2025 base budget adjustments amount to $741,441 as detailed in the draft 2025
Annual Budget.
The base budget increase of $218,051 is the result of existing personnel wages and
benefits which include the following assumptions for 2025:
• Cost -of -living adjustment (COLA)
• 7.50% estimated increase in health insurance premiums (employer's share)
• 2.00% estimated increase in dental insurance premiums (employer's share)
• 6.00% estimated increase in workers compensation insurance premiums
• Wage & benefit assumptions for vacant positions
Non -property tax general fund revenues decreased $16,462 which increases the need
for tax levy dollars. The decrease can primarily be attributed to the decrease in building
permits and plan inspections fees, partially offset by increases in state aid, interest on
investments, and refunds & reimbursements.
The transfer in of $20,000 from the Cable TV & Communications Fund has been
discontinued. The transfer previously supported the cost of the Communications
Specialist position within the Administration Department.
Rookery Activity Center
The Rookery Activity Center tax levy is not proposed to increase, although the proposed
2025 budget includes a $99,123 deficit. The Rookery Activity Center began operations in
Spring 2022 and completed its first full fiscal year in 2023. The 2024 budget included a
$500,000 tax levy which brought tax levy support for recreation funding back to pre -
pandemic levels. Prior to the COVID-19 Pandemic and the opening of the Rookery, the
tax levy supported the YMCA facility and recreation programming at roughly $490,000
annually.
Capital Equipment Replacement
In line with 2024-2028 Financial Plan, a $210,000 increase in the Capital Equipment
Replacement Levy is proposed for 2025, for a total levy of $810,000, Citywide capital
expenditures proposed to be funded with the levy in 2025 are included in the 2025-
2029 Financial Plan.
The levy increase continues to facilitate transitioning away from Certificates of
Indebtedness and towards a Pay -As -You -Go approach to capital equipment financing.
The impact of that levy can be seen on the Projected Cash Balance statement for the
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Capital Equipment Replacement Fund presented within the draft 2025-2029 Financial
Plan.
Capital Fire Water Tender Replacement
In September 2022, the Council approved a contract with Custom Fire for the purchase
of two water tenders at a total cost of $2,262,000. The funding was provided through an
interfund loan to be paid back with a tax levy over 10 years.
In December 2023, Public Safety Aid in the amount of $229,294 was used to buy down
the interfund loan and decrease the annual payment/tax levy. The levy commenced in
2024 and will go through taxes payable 2033.
Street Maintenance
The Street Maintenance Levy has increased $148,500 or 15.00%. The $1,138,500 levy
will be used in combination with $120,000 from the Water Fund to complete a street
preservation project in line with the City's Pavement Management Plan.
The 2023 Pavement Management Plan recommended increased funding to maintain a
target street condition rating of 73. Historical street maintenance funding is as follows:
• $661,500 in 2020 (5.00% annual increase)
• $711,113 in 2021 (7.50% annual increase)
• $782,224 in 2022 (10.00% annual increase)
• $860,446 in 2023 (10.00% annual increase)
• $990,000 in 2024 (15.00% annual increase)
A decline in the street condition rating is predicted in future years with an increase less
than 15.00%.
Debt Levy
The significant change to the debt levy is the addition for the 2024 Street
Reconstruction of Colonial Woods and Pine Haven. Bonds are anticipated to be sold in
late 2024 for construction in 2025.
The Finance Director stated that Council action is requested by the September 23rd
meeting in order to set the preliminary tax levy and schedule a public hearing date. The
preliminary levy set at the September meeting may not be increased thereafter but may
be lowered before approving the final budget and levy in December.
Council Discussion
The City Council reviewed the draft 2025 Preliminary Budget and 2025-2029 Financial
Plan. They provided direction to the Finance Director regarding the proposed budget for
inclusion in future discussions and to prepare for the September 23rd Preliminary Budget
and Levy Adoption,
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4. Adjournment
Mayor Rafferty adjourned meeting at 8:43 p.m.
These minutes were approved at the regular Council Meeting on December 9, 2024,
Roberta Colotti, CMC R I�Raf erty,
City Clerk Mayo
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