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HomeMy WebLinkAbout12/10/1992 Council Minutes1 1 1 1993 GENERAL FUND BUDGET HEARING CITY OF LINO LAKES COUNCIL MINUTES DECEMBER 10, 1992 TIME STARTE:I ..:. ...................................................... ..................................................... ..................................................... TIME. ENDED MEMBERSPRESEN MEMBERSABS'ENT einert, Neal, Kuether, Elliott Bergeson': One Staff Members present: City Accountant, Paula Schloer; Financial Director, Mary Vaske; Public Works Director, Don Volk; Chief of Police, Dean Campbell; City Administrator, Randy Schumacher and Clerk -Treasurer Marilyn Anderson. The purpose of the meeting was to conduct the 1993 General Fund Budget and levy public hearing. OPENING STATEMENT BY MAYOR REINERT Mayor Reinert opened the public hearing at 6:35 P.M. and outlined the format for the public hearing. He noted that the proposed 1993 Budget is a consensus budget. Not all Council Members are happy with everything that is in the budget, however an agreement was reached. Mayor Reinert noted that the population in Lino Lakes is nearly 11,000 persons. Services are needed for new homes and nearly all city departments need assistance to provide public services. Mayor Reinert also noted that long range planning has also been considered by the City Council. This was done to avoid the "peaks and valleys" that have previously been experienced in the budget which leads to erratic property taxes. A Certificate of Indebtedness was considered to purchase needed capital improvements, such as a dump truck, squad cars and fire equipment. The purchase of a Certificate will allow the cost of these purchases to be spread over a period of five (5) years. This action will also help to keep property taxes level. Mayor Reinert noted that an area of extreme importance to the City Council is their commitment to business and industrial growth. He noted the new Lino Business Park and the need to PAGE 1 93 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 service that area with utilities to provide an area for this growth. Mayor Reinert explained that business is needed to provide a diversity in the tax base and relieve the tax burden of homeowners. He explained that the City Council has caCluded ."" - that a consultant should be hired to implement a plan of development. Mayor Reinert noted that if this City dos not actively pursue commercial and industrial developtent, sifch -"* development will go elsewhere :-- INTRODUCTION TO "TRUTH IN TAXATION" BY RANDY SCHUMACHti, CITY ADMINISTRATOR. Mr. Schumacher explained that tfiepurpose of the public hearing is to allow citizen input into the 1993 Operating Budget:' He explained that all landowners iiriiino Lakes have received a "preliminary" notification of their proposed 1993 property taxes. Mr. Schumacher noted that the problem with this statement is that' it does not contain current information. The infclimation in the statement is based on a preliminary 1993 Operating Budget and a preliminary 1992 tax levy. Both figures have been reduced.Mr Schumacher used the overhead projector and outlined the 1993 Operating Budget and the 1992 tax levy, collectablef993. Mr. Schumacher.nbted that the state has placed certaildates , on the City and also governs tax rates. The most receriemaridate involves requiring all municipalities to pay sales tax. :This is good for the state but will add about $23,000.00 fd:the',1993 Operating Budget. The affect of this is shifting 'a-eftom the state level to the municipal level. The state has reifiled the same tax rates so that all homes:valued up to $72,000MD-will be paying the same tax rate as in 1992. The tax rate for homes valued over $115,000.00 have been reduced. This aPpears to be putting a larger tax burden on the lower to moderAe'Valued homes. ' * Mayor Reinert explained that this City is and experiencing all the same problems as He noted that he is well aware that taxes City Council is attempting to change this development. a rapidlygrowingCity any other growYng are not in line and the s ituat citi"w*Pth"economic 710,i 14A - Jr. 7i, 7 Council Member Bergeson referred to page 8 of the 1993 Operating Budget docUment. He noted that the lower valued homes have an increase in taxes and the higher valued homes have 'a decrease in taxes. It should be noted that the City did not have a voice iW this increase but it is a result In the state change in tax formula and hot the result of the City budget proces's. PAGE 2 1 1 1 97 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 Mayor Reinert asked for comments and suggestions from the audience. Bruce Hanson, 6980 Lake Drive noted that the morning paper contained an article regarding a windfall on sales tax that will be coming back to the cities. Mayor Reinert explained that the sales tax had been increased from 6% to 6.5% a couple of years ago. The purpose of the additional .5% was to create a trust fund that would take the place of Local Government Aid. The state has promised that all this money would be given to the 1992 municipalities, however, the state is looking at this trust fund to help reduce its expected deficit. At this time it appears that Lino Lakes will realize approximately $11,000.00 from the trust fund. At the same time it appears that Lino Lakes may lose as much as $92,000.00 of Local Government Aid. Mr. Hanson noted that the City has appointed a task force and is proposing to hire a consultant to solicit new businesses. He asked how the City is proposing to get new businesses into this area. Mr. Hanson said he was sure that this City will never see tax dollars go down. Mr. Hanson said he felt that just because some businesses located in Lino Lakes does not mean there will be lower taxes. He said that the City is wishing for something that is never going to happen. Mayor Reinert said that he hoped this was not the case, however, if the City does not try, we will never know. He noted that a home does not carry its "weight "especially if young families are moving into the community. The taxes realized from that home will not pay to educate the children and there are still county, city and other taxing districts who must be supported by taxes. Mayor Reinert noted that Lino Lakes is a "not sought after" community. He said he felt that this City is on the verge of something happening in the area of business and industry. Mayor Reinert felt that the City Council was fortunate to have individuals available with 30 years experience to seek out new businesses. He noted that commercial growth will not happen overnight but he also said he did not want this City to be bypassed. Mr. Hanson asked how long range of the plan for hiring this new person? Mayor Reinert explained that the City is not hiring a new employee but is contracting with a consultant on a part-time basis. The City will not be spending a "ton" of money but a key individual will be available. The time frame appears to be about five (5) years. The consulting arrangement will be on a year to year basis. Doug Storms, 620 Andall Street explained that his property tax notice is projecting a 19% increase in taxes. He said he understood from the presentation tonight that this notice may not Page 3 93 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 be accurate. Mr. Storms said he understood that the population is increasing rapidly and he said it seemed that this along should cover the additional expenses. He said he felt that the increase should be tied to the inflation rate. Mr. Storms said 19% seemed high, his salary will not go up 19% and probably not even 5%. He asked why the City should have to raise the taxes 19% when inflation will be about 5%? Mayor Reinert explained that the notice Mr. Storms received in the mail is based on preliminary information and is not accurate. The City Council has now revised the proposed budget and the proposed tax levy and both have been reduced. Mr. Storms noted that even after the reduction, there still will be a 17% increase in his taxes. Mr. Schumacher noted that the proposed increase in Mr. Storms taxes could be because of an increase in Mr. Storms property value or because of another taxing entity, not the City. Mr. Storms explained that his property value did go up approximately 5% and if his property taxes go up 5% he could live with that. However, the statement he has received seems to indicate a much higher increase. Council Member Bergeson explained that property taxes are calculated based on certain rates and based on property valuation. He again noted that the state has increased the formula for homes valued at $72,000.00 or less. Mr. Storms said he is looking at a situation which is indicating that he will have a 14% or more increase in his taxes and he will only be getting a 2% or 3% increase in salary. He asked that the City be careful about this. Mr. Schumacher noted that although taxes are high in Lino Lakes, this City has not increased taxes in the past seven7 This is the first time in seven (7)years at taxes C are ) years osto be increased. Mr. Storm asked where doesthisCitystand ined comparison to other municipalities in the metro area. It was indicated that Lino Lakes has dropped in the rating and is now about 16th. Mayor Reinert noted that this compares to other developing municipalities. New residents expect a variety of services and it is difficult to deal with the magnitude of demands. Mayor Reinert explained that this City is gambling that the portion of the budget devoted to economic development will pay off. Mr. Storms asked if Lino Lakes is a Star City. Mayor Reinert said no. Mr. Storms asked if there were advantages to being a Star City. Mr. Schumacher said that this City looked at this a couple of years ago.- It is costly, however some key ingredients of the Star City plan such as marketing have been used by this City. If Lino Lakes did want to get into the plan, about 50% of the work is already done. The Economic Development Committee PAGE 4 1 1 1 1 1 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 will be taking a look at this to determine if they want to invest the time and money to become a Star City. Mr. Schumacher noted that becoming a Star City means that the municipality i`s ready and welcomes economic development and there is a plan and procedure to follow and it is easy to develop in that municipality. Mr. Schumacher said he felt that a city can have the policy and plan and not necessarily be a Star City. Council Member Elliott noted that this year this City was allowed to set the levy where it wanted to because levy limits have been lifted. She noted that because the school districts in the past couple of years have had significant increases no one on the City Council wanted to burden the tax payers with additional spending for needed capital equipment such as squad cars or street equipment. This year the City could "catch up" with a minimal impact on the tax payers because other taxing entities were not planning significant increases. The City has four (4) squad cars with over 100,000 miles on each of them and a 1974 dump truck that is needed for snow plowing and street repair. Replacement of these items is being done in a year that will hurt tax payers the least. Council Member Neal noted that the City Council did look at abolishing the Police Department and contacting with the Sheriff's Department. However, the level of service would greatly be diminished. The City Council also considered contracting snow plowing. This would mean that some streets may not get plowed for a day and a half. Mayor Reinert noted that four (4) council people were involved with elections in the past year. As they were out campaigning, each person heard many inquiries regarding economic development. He felt that Lino Lakes citizens are really interested in encouraging this type of development to relieve the tax burden of homeowners. Council Member Bergeson noted that business property is taxed at a different rate than residential property. He also felt that business development will help relieve the tax burden on the homeowner. Council Member Bergeson said that Mr. Storms may be right in saying that property taxes may never go down in Lino Lakes, however if business development does not occur, property taxes will continue to increase and maybe at an even faster rate. He expressed hope that taxes would be reduced and that this City would drop out of the top 10 list of highest property taxed communities. Council Member Bergeson noted that if this City does not begin to plan for commercial and industrial development, all prime commercial and industrial property will be developed into housing. PAGE 5 9 4 CU 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 Everett Mitchell, 6975 Lake Drive asked why his property value has increased about 30% almost doubling his property taxes. He noted that the City has taken 1.5 acres of his property for Section 17, 18 Water Management however, he is still paying taxes on the property. Mr. Hawkins noted that the City did not secure title to this property, only obtained an easement for drainage purposes. Mr. Mitchell still holds fee title to the property and is still taxed on the acreage. Mr. Schumacher suggested that Mr. Mitchell contact the Anoka County Assessors office to determine if they have the correct value on this property. Mr. Mitchell noted that the value of his property increased about 30% this past year. He has not done anything with his property and asked the reason for the change in value. Mayor Reinert suggested that Mr. Mitchell also ask the Anoka County Assessors office to review this matter. It was noted that a mistake could have been made on this property. Mary Ayde, 1030 Evergreen Trail referred to page 17 of the recommended 1993 Operating Budget. She asked for additional detail regarding the Solid Waste Budget. Mrs. Ayde explained that she and her family operate a garbage removal company. They have a very extensive recycling program and residents have been very responsive to the program. Mrs. Ayde explained her concern is in regard to the money that comes from the county to the City for the recycling program. She noted that at one (1) time there was some money given to the haulers as a minimal reimbursement for operating the recycling programs. This was discontinued. Mrs. Ayde asked where all the money from the county is going. She referred to the budget which indicates that $15,000.00 is for contracted service, $6,000.00 is for advertising and $1,500.00 is for communications. Mrs. Ayde asked what does this mean because the people who do all of the work (haulers) are not getting any of the money but they are the people who are collecting the money to be put into the municipalities coffers through the sales tax and the landfill abatement charges. She asked what happens to the overage. Mr. Volk said that he would be happy to go through the Solid Waste budget line by line with Mrs. Ayde. Mrs. Ayde said she sits on many boards and commissions and this is a subject of many questions. She noted three (3) communities that are using the money to supplement their operating budget. Mayor Reinert explained that this City is doing a good job with the recycling program and has gone beyond its quota. Mr. Volk explained that the haulers were reimbursed for collecting recyclables until about a year ago. The money is now used for additional publicity and for other methods of recycling to meet the drastically increased county goals. Mayor Reinert noted that this is another PAGE 6 1 1 1 1 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 cost necessary to provide a service to the citizens. This cost has been escalating and has probably generated citizen complaints. Mrs. Ayde explained that the residents are very involved and believe in doing something to preserve the environment. They are willing to cooperate. She said her problem is trying to determine where the money from the county is being spent. Council Member Bergeson noted that it appears that costs on two (2) line items have increased, the salary that is paid to a part- time coordinator and some of Mr. Volk's salary. The Contracted Services portion of the budget includes payment to the Boy Scouts for their cardboard recycling program and also for the twice a year recycling day. Mr. Volk explained that the money received from the county is spent in the Solid Waste Abatement budget and none of it goes into the General Operating Budget. Mrs. Ayde said she was glad that the Boy Scouts are being supported through this program. Mr. Volk will meet with Mrs. Ayde on this matter. Mr. Tom Smith, 874 Oak Lane noted that we have a new six (6) bay fire station and yet one (1) fire truck is sitting in a snow bank. He asked if this vehicle could be parked inside the fire station. Mayor Reinert noted that this vehicle is for sale. It is very old and out of service. Mr. Smith also noted that there is no siding on a portion of the Police Department building. He asked if this could be completed. Mr. Volk explained that the siding has been on order for approximately two (2) months and it is promised to be here before the first of the year. Council Member Neal also noted that blacktopping the parking lot was expected to be completed before the construction season ended. However, a snow storm canceled the blacktop installation. Mayor Reinert thank everyone for coming this evening and asked for community support of the Economic Development effort to help turn the tax base around. Council Member Neal moved to close the public hearing at 7:47 P.M. Council Member Elliott seconded the motion. Motion carried unanimously. Council Member Kuether moved to adopt Resolution No. 92 - 146 Certifying the Final 1992 Tax Levy, Collectable in 1993 in the amount of $2,073,987.00. Council Member Elliott seconded the motion. Motion carried unanimously. Council Member Kuether emphasized that $50,000.00 of the 1993 Operating Budget is planned for a reserve and will only be used PAGE 7 `0 I 1412 1993 GENERAL FUND BUDGET HEARING DECEMBER 10, 1992 if the state does cut back on Local Government Aid. If the $50,000.00 is not needed it will be put in the 1994 Operating Budget. Council Member Bergeson explained that if all departments would have been funded as needed, the budget would be nearly a million dollars higher than what was approved. The 1993 Operating Budget does not provide everything that is needed by each department. The City Council was faced with picking and choosing which items they felt were the most important for each department. Mayor Reinert noted that every Council Member had different concerns in different areas of the budget. The final budget was a consensus of the City Council. Council Member Elliott moved to adopt Resolution No. 92 - 147 Adopting the Final 1993 Annual Operating Budget for the City of Lino Lakes. Council Member Bergeson seconded the motion. Motion carried unanimously. Council Member Bergeson expressed thanks to the staff for their work on the budget. Mayor Reinert noted that Council liaison members have worked with the department heads on this matter as well and he thank them for their work. Council Member Neal moved to adjourn at 7:52 P.M. Council Member Kuether seconded the motion. Motion carried unanimously. These minutes were considered, corrected and approved at a regular Council meeting held on December 28, 1992. Marilyn G. Anderson, Vernon F. Reinert, Clerk -Treasurer Mayor PAGE 8 1 Council member Kuether introduced the following resolution and moved its adoption: CITY OF LINO LAKES RESOLUTION NO. 92 - 146 RESOLUTION CERTIFYING THE FINAL 1992 TAX LEVY, COLLECTABLE IN 1993. WHEREAS, the City of Lino Lakes is in need of certain funds to pay expenditures for General Fund operating costs anticipated in the year 1993, WHEREAS, the City of Lino Lakes is in need of certain funds to pay expenses towards Certificate of Indebtedness obligations, WHEREAS, the City of Lino Lakes is in need of certain funds to pay expenses towards the Public Project Revenue Bonds, WHEREAS, the City of Lino Lakes is not restricted by levy limitations imposed by the State of Minnesota, NOW THEREFORE BE IT RESOLVED, that the City of Lino Lakes, Anoka County, Minnesota, hereby does levy on a final basis the following upon the taxable property in said City of Lino Lakes, to -wit: 1. Total amount levied in the year 1992 to be spread for taxes due and payable in the year 1993 is in the total sum of $ 2,073,987.00. 2. The total amount above levied is for the following purposes: GENERAL OPERATING $ 1,776,369.00 General bonded Debt Public Project Revenue Bonds Equipment Certificates of 1989 Equipment Certificates` of 1989B Equipment Certificates of 1990A Equipment Certificates of 1991A Total General Obligation Bonded Debt 81,139.00 72,639.00 71,316.00 22,084.00 50,440.00 297,618.00 TOTAL LEVIES 2,073,987.00 Page 1 4 BE IT FURTHER RESOLVED by the Lino Lakes City Council that the general fund operating budget and Special levies for Equipment Certificates and the Public Project Revenue Bonds as reviewed by the City Council represents the basis for this levy. Individual department budgets are subject to final approval by the City Council and shall be authorized by separate action. Adopted by the Lino Lakes City Council this 10th day of December, 1992. Vernon F. Reinert, Mayor Cc�r ; , 1X. � /ter^ Marilyn G. Anderson, Clerk -Treasurer The motion for the adoption of the foregoing resolution was duly seconded by Elliott and upon vote being taken thereon, the following voted in favor thereof: Bergeson, Elliott, Kuether, Neal, Reinert. The following voted against same: None Where upon said resolution was declared duly passed and adopted: Page 2 1 Council member Elliott introduced the following resolution and moved its adoption: CITY OF LINO LAKES RESOLUTION NUMBER 92- 147 RESOLUTION ADOPTING THE FINAL 1993 ANNUAL OPERATING BUDGET FOR THE CITY OF LINO LAKES. WHEREAS, Pursuant to State Statute, the Lino Lakes City Council is required to adopt a resolution setting out revenues and expenditures for the upcoming fiscal year, NOW THEREFORE, BE IT RESOLVED: That the following General Fund operating budget be adopted on a final basis for 1993: 1993 FINAL GENERAL FUND BUDGET REVENUES: Levy $ 1,776,369.00 Intergovernmental Revenue 194,141.00 Business Licences and Permits 18,320.00 Non Business Licences and Permits 348,000.00 Charges for services 21,500.00 Public Safety 89,662.00 Municipal Fines 90,000.00 Investments 50,000.00 Miscellaneous 48,262.00 Non -Revenue Receipts 173,150.00 TOTAL GENERAL FUND REVENUES 2,809,404.00 EXPENDITURES: Mayor and Council 40,495.00 Elections 4,094.00 Administration 295,850.00 Assessor 30,107.00 Legal Printing 13,700.00 Consultants 194,001.00 Engineering 101,220.00 Planning and Zoning 6,782.00 Government Buildings 129,781.00 Charter Commission 1,350.00 Police 675,089.00 Fire 225,532.00 Building Inspections 66,360.00 Civil Defense 4,033.00 Animal Control 2,300.00 Public Works 529,435.00 Solid Waste 38,869.00 Page 1 I Q6 Resolution 92-147 Cont. Expenditures Continued Recreation 60,608.00 Parks 229,997.00 Park Board 4,139.00 Forestry 54,239.00 Cable TV 1,423.00 Others 100,000.00 TOTAL GENERAL FUND EXPENDITURES 2,809,404.00 Adopted by the Lino Lakes City Council this 10th day of December 1992. Vernon F. Reinert - Mayor � n , . Marilyn G(, Anderson, Clerk -Treasurer The motion for the adoption of the foregoing resolution was duly seconded by Bergeson and upon vote being taken thereon, the following voted in favor thereof: Bergeson, Elliott, Kuether, Neal, Reinert. The following voted against same: None. Where upon said resolution was declared duly passed and adopted: Page 2