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HomeMy WebLinkAbout08/31/2000 Council Minutes• DRAFT CITY OF LINO LAKES CITY COUNCIL Special Work Session on Proposed 2001 Budget Thursday, August 31, 2000 Community Room, Lino Lakes City Hall Present: Mayor John Bergeson, Council Members Donna Carlson, Jeff O'Donnell, Jeff Reinert Absent: Council Member Caroline Dahl Also Present: City Administrator Linda Waite Smith; Director of Administration Dan Tesch; Director of Finance Al Rolek; Director of Community Development Brian Wessel; Director of Public Services Rick DeGardner; Director of Public Safety Dave Pecchia; City Engineer John Powell Mayor Bergeson convened the meeting at 8:35 a.m. Overview City Administrator Waite Smith shared the objectives the management team had when beginning preparation of the draft budget and the process used to compile it. She also explained strategies the management team employs to contain costs. Finally, she explained that since the last tax rate increase in 1999, the City has absorbed a number of costs including salary adjustments and operation of an additional building complex. Finance Director Rolek reviewed the budget calendar and explained that the maximum levy must be certified to Anoka County by September 15. Therefore, the City Council needs to adopt a maximum levy at its September 11 meeting. After the levy is certified, it can be adjusted downward but not upward. Rolek then explained changes that have been made since the last budget, including an allowance for salary adjustments in 2001, the addition of 5.70 full time equivalent (FTE) staff units, accounting for the entire salary of the Senior Coordinator in the General Fund instead of using CDBG funds for half, centralizing costs such as newsletter production and office supplies, separating the administrative positions in Community Development into a new cost center instead of showing them in the Economic Development Division, and beginning the process to implement a GIS program. Next, Rolek referred to a comparison of the adopted tax levy for 2000 and the proposed tax levy for 2001. He noted the TIF penalty which is shown as HACA (Homestead and Agriculture Aid) that is withheld from the City by the State imposes a significant constraint on the budget. He indicated that although the State Legislature dropped levy limits for 2001, they may well reinstate them the following year. He suggested it might be beneficial to include the TIF penalty in the debt levy because in the past debt levies have been outside the levy limits. • The proposed budget would increase the City's tax capacity rate from 35.920% in 2000 to 36.482% in 2001. Rolek observed that except for 1999 when tax rate compression skewed the numbers, the City's tax capacity rate has been fairly level. The proposed increase for 2001 would increase the City's share of residential property taxes $6.49 per year for a house valued at $100,000; $11.12 per year for a house valued at $150,000; and $20.39 per year for a house valued at $250,000. Rolek briefly reviewed the capital items that would be purchased through Certificates of Indebtedness or internal, interest incurring loans from the Area and Unit Fund. He explained the impact the three-year repayment schedule will have on future budgets. He then referred to the list of capital requests that had been eliminated by staff while finalizing the draft budget. He explained the importance of establishing a revolving fund for equipment replacement. Such a fund would save approximately $42,000 in interest on 2001 certificates of indebtedness. The proposed budget does not include money to establish a revolving fund. • • Rolek then moved on to an explanation of anticipated revenues for 2001. Property taxes account for 64% of revenues. He reviewed the revenue sources by category and noted the estimates are based on historical experience. He explained that the proposed budget includes funding drawn from reserves, leaving reserves at a level just above 50% of expected General Fund expenditures. He noted this is a healthy level of reserves but if the City continues to use reserves for operating expenditures, the level could be impacted negatively. He then provided a brief overview of proposed expenditures and referred to a list of adjustments made to revenue and expenditure requests in fmalizing the draft budget. Community Development Department Community Development Director Brian Wessel presented the proposed budget for divisions in his department. A new cost center containing the Community Development Director and Community Development Secretary has been created by moving those positions out of Economic Development. Wessel reviewed the proposed Economic Development budget and noted that it assumes that until he retires in September 2001, he will be the temporary Economic Development Director and a new Community Development Director will assume responsibility for the Community Development Department. Wessel then reviewed the proposed budget for the Planning & Zoning Division. He explained that $20,000 for planning consultants to assist with new zoning ordinances was not spent in 2000 and will be carried over to 2001. City Engineer John Powell explained the proposed 2001 contract with his firm, TKDA, does not include a cost increase for 2001. The firm is committed to keeping Powell in the City even though he has been promoted to a department head position in the firm He has • been and will continue to delegate tasks to lower paid employees of his firm to make better use of his time and to keep contract costs down. The contract is on a "not to exceed" basis and the City pays for actual costs. Wessel noted that the City Administrator analyzed the contract and alternatives and recommends continuing the contract. Powell added that the City should do the analysis each year to determine if it's more cost effective to continue to contract or to hire engineering staff. Wessel then discussed the cost centers for Environmental Services, Solid Waste Abatement, and Forestry. One staff person is allocated among these cost centers. Rolek clarified that the $25,000 capital outlay in Forestry is for trees purchased by the City, then resold to developers. Public Services Public Services Director Rick DeGardner presented the proposed budgets for divisions in his department. The Streets Division is requesting half an additional maintenance position. The afected employee currently works half time in Utilities and half time in Streets. The Fleet Management budget now includes insurance for all vehicles. The Government Buildings Division is requested a full time Building Custodian to assist • the existing Building Maintenance Technician. The net cost of the custodian would be $7,000 because the position would allow the City to drop cleaning contracts for old city hall and the fire station, eliminate costs for temporary cleaning assistance, and assume responsibility for cleaning the Early Childhood Learning Center in return for payment. The Parks budget remains essentially unchanged. It includes $13,000 for park/trail development. • The Recreation budget includes salary increases for temporary employees in order to compete with other employers such as McDonald's. DeGardner was asked if the fees charged for recreation programs cover the costs. He responded that the goal has been to break even and all the programs except the playground program do that. Recreation Supervisor Barry Bernstein added that the City keeps informed of rates in other cities and ours are in the average to higher than average range. The Streets budget is essentially unchanged except for salary adjustments. DeGardner then referred to a list of Capital Outlay items that are not funded in the proposed 2001 budget. The list includes trails and parks and maintenance items. Council Members expressed concern that there is not money included for those items. Residents have made it clear this is a high priority. Waite Smith noted that staff understands that but couldn't see how to fund the items from the General Fund without a significant tax increase. • • • DeGardner reviewed budgets for Special Revenue Funds, including Recreation, Water and Sewer. A Council Member asked if the City's rates for water and sewer are higher than in other communities. DeGardner noted that Powell is completing a three-year rate study and recommendation. Powell added that it would be brought to Council in November. DeGardner noted that the largest expense in the sewer fund is the fee paid to the Metropolitan Council for wastewater treatment. Additional staffing is being requested for the utilities funds, including an additional one half FTE for a maintenance worker and an additional one half FTE for a utility billing clerk. Public Safety Public Safety Director Dave Pecchia presented the proposed budgets for Police and Building Inspections. The Police budget includes an additional Sergeant. That would be a promotion from patrol and a new officer would be hired to backfill. To accommodate budget constraints, the Sergeant position would be created in September 2001. The position would allow supervision during all hours of the day. Pecchia went on to explain the vehicle replacement schedule. He noted squad cars are replaced on a three year cycle. Then they are either used as staff cars or auctioned. He explained the fleet is being reduced by two vehicles, partly because a vehicle will be shared by Building Inspections and Police Reserves. The Building Inspection budget is essentially unchanged from last year except for salary adjustments. Administration Administration Director Dan Tesch presented the proposed budget for the divisions in Administration. The Mayor and Council budget shows a significant increase because newsletter production is now centralized in this cost center. There is also an increase in dues to organizations such as the League of Minnesota Cities. The Administration division is requesting the addition of an Administrative Assistant to start mid -year. Tesch noted this is the sixth year for the request. Bergeson noted it has been approved in the past but the money has always been spent on something else or the position assigned to another department. The Elections and Voter Registration budget shows a decrease in Personal Services, largely because there are three elections scheduled for 2000 and only one in 2001. The capital outlay is for additional voting booths. The Cable TV budget is essentially unchanged. • • The Charter Commission budget shows a marked decrease, largely because historically the Commission has not spent anything. Council Members requested a history of Charter Commission budget and actual spending. The Seniors budget now contains 100% of the salary for the Senior Coordinator who is a 0.625 FTE. Part of the salary used to come from CDBG funds but last year the rules for CDBG funds were changed. Waite Smith noted that this budget originally contained a request for a $1,200 refrigerator. The request was cut but staff is hoping that CDBG funds might be used to purchase it. Council Members asked about the possibility of providing congregate dining at the Senior Center. Staff agreed to research this. Council Members also noted that the Senior Center is currently located in the old city hall, which is not near where most seniors live. A location within the Town Center would make more sense. Waite Smith suggested the Council consider stockpiling CDBG funds for several years to help provide facilities, perhaps in cooperation with some other development. Al Rolek explained the Finance Department budget. He is requesting that the Accountant III position be increased from 0.75 FTE to full time and that a 0.50 FTE for MIS be added to the part time Accounting Clerk -Utility Billing position. Waite Smith noted that during preparation of the 2000 budget, it was noted these positions should probably be full time but it was decided to wait for the new finance director to determine. The Legal Consultants budget contains only inflationary adjustments. Council Members asked why the criminal attorney cost is so much higher than the municipal attorney. Pecchia responded that the criminal attorney prosecutes all violations cited by Lino Lakes officers and by State Highway Patrol within the borders of Lino Lakes or on the Interstate beside the City. Other Wessel distributed a report form an internal staff committee on GIS (Geographic Information Systems). He explained that the consensus of the committee is that GIS would be a valuable addition to the City's technology but the estimated $100,000 needed to implement couldn't be found in the proposed 2001 budget. Instead, $5,000 is being carried over from the 2000 budget and an additional $15,000 is being requested for 2001 to do a demonstration project and lay the foundation for future implementation. DeGardner reviewed the detail for Capital Equipment Requests for 2001. He noted the Flusher truck is now inoperable and therefore, unsupervised ice rinks probably won't be flooded this winter. He explained the alternatives he has explored: renting a truck, buying a used truck, using a Fire vehicle, contracting with another city, repairing the truck. None of them is viable. Lead time is six to seven months to actually get a truck. Council Members agreed that DeGardner should immediately start the process to obtain the truck. The meeting adjourned at 12:50 p.m. Respectfully submitted, Linda Waite Smith City Administator • •