HomeMy WebLinkAbout05/26/1992 Council Minutes1
1
1
COUNCIL WORK SESSION
CITY OF LINO LAKES
COUNCIL MINUTES
MAY 26, 1992
DATE May: 2 6 , 19 92
TIME. STARTED 6 :00 P.M.
TIME ENDED...:. `:
MEMBERS PRESENT: Reinert, Neal, Kuether, „Elliott, Bergeson:
MEMBERS ABSENT :> None
Staff members present: City Engineer, Darrell Schneider; City
Auditor, Fred Espe; City Administrator, Randy Schumacher and
Clerk - Treasurer Marilyn Anderson.
The purpose of the work session was a review of the 1991 Annual
Financial Audit presented by Mr. Espe.
Mr. Schumacher introduced Mr. Espe. Mr. Espe noted that he, Mr.
Rob Tautges, Mr. Schumacher, Ms. Schloer and Ms. Vaske have
reviewed both the audit and the management report in great depth.
Mr. Espe said that he would review the audit at this time in some
depth for the City Council but only highlight significant items
during the regular Council meeting.
Mr. Espe highlighted areas that are of concern to the City:
- Delinquent special assessment collection rate is about 77%.
this is due primarily to one (1) subdivision, Rice Lake
Estates. (The collection rate has increased since this audit
and assessments for the entire subdivision are nearly paid.)
Mayor Reinert asked Mr. Espe to determine how much of the
delinquency relates to 1991 and how much relates to prior
years.
- $95,612.00 was added to the General Fund balance. The General
Fund Balance as of December 31, 1991 was $1,265,236.00.
- The sewer and water operational fund continues to reflect a
net decrease in retained earnings. Mr. Espe noted that this
situation will change as the number of users increase. He
also noted that the Metropolitan Waste Control Commission
(MWCC) continues to escalate its charges to municipalities.
Mr. Espe noted legislative actions that will affect the financial
position of the City:
PAGE 1
27
28
COUNCIL WORK SESSION MAY 26, 1992
A water connection fee of $5.21 per year was implemented for
all municipal water users.
Explained how the increase in sales tax did help Lino Lakes.
(This is not true of all municipalities.)
Explained the relationship of state aid to property tax.
(As state aid was reduced, property taxes increase.)
Mr. Espe reviewed the charts outlining sources of revenue for
Lino Lakes. In 1991, property taxes represented 48% of the
City's revenue.
Mr. Espe reviewed the expenditures for 1991. He noted that
public safety used 37.25% of the budget, public works 20.65 %,
parks 10.74 %, capital outlay 2.25% and general government 28.10 %.
The collection of delinquent taxes continues to be very strong.
The collection rate was 99% in 1991. However, the collection of
special assessments continues to fluctuate. Mr. Espe noted that
the ability to collect special assessments in a timely manner is
vital to the financing of the Special Assessment Debt Service
Fund. He recommended that the City monitor the collection rate
and provide supplemental financing if assessment collections are
not adequate to meet bond debt payments.
Mr. Espe addressed the Area and Connection Fund. This fund will
eventually account for area and unit assessments for funding
various debt issues. This City has amended collection procedures
on the fund but should continue to monitor it as well.
Mr. Espe noted that MWCC bills all municipalities annually on an
estimated basis. These billings are later adjusted and
municipalities are billed the additional amount or are given
refunds. Mr. Espe noted that billing increases have been
substantial over the past several years. Lino Lakes estimated
cost for 1992 increased 33% over 1991.
Mr. Espe reviewed the Gas Utility Fund. He recommended that Lino
Lakes request Circle Pines to provide their calculation of
franchise fee remittances including bad debt adjustments. He
recommended that this City review with the City of Circle Pines
their methods of enforcing collection and consider adopting such
procedures within the City such as including significant
outstanding delinquent billings on assessment search records.
Mr. Espe reviewed actions taken by the City regarding the gas
utility operations and outlined some provision of the new
agreement. He also reviewed the summary of considerations
prepared by Tautges, Redpath and Company, LTD. which was prepared
to help the City decide whether the Lino Lakes portion of the gas
PAGE 2
1
1
1
COUNCIL WORK SESSION MAY 26, 1992
system should be purchased from Circle Pines.
Mr. Espe explained that the most important issues outlined in the
audit are:
Monitor state funding
- Monitor Sewer and Water Fund and adjust rates accordingly.
- Monitor fund balances for the bond funds.
Mayor Reinert thanked Mr. Espe and adjourned the work session at
6:40 P.M.
These minutes were considered, corrected and approved at the
regular Council meeting held June 8, 1992.
Marilyn G. Anderson, Vernon F. Reinert,
Clerk - Treasurer Mayor
PAGE 3
29