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CITY COUNCIL WORK SESSION
APPROVED
DATE
MEMBERS PRESENT
MEMBERS ABSENT
CITY OF LINO LAKES
MINUTES
September 4, 2007
: September 4, 2007
: Councilmember Carlson, O'Donnell,
Reinert, Stoltz and Mayor Bergeson
: None
Staff members present: City Administrator, Gordon Heitke; Finance Director, Al Rolek;
Community Development Director, Mike Grochala; Director of Public Safety, Dave
Pecchia; Director of Public Services, Rick DeGardner; Director of Administration, Dan
Tesch.
REVIEW OF PRELIMINARY 2008 BUDGET (continued from August 27, 2007
work session)
The Mayor noted that in addition to the items that were forwarded from the last budget
work session, the council received a request from the Charter Commission for additional
funding; that matter would be added to the agenda. He requested that discussion of
funding for the Blue Heron Days festival and other outside funding requests be included
also. There was also a request to discuss the 2007 year end balance, the hospital district
funds, sewer rates, and attorney fees (possibility of going out for bids for services).
Finance Director Rolek reviewed the proposed budget. It includes a level tax rate as the
council requested. The assumption of market value growth is the basis, however, the
county has not yet released all the pertinent data.
Building Permit Revenue - On the question of building permit revenue, Mr. Rolek
explained that the information presented by staff is based on estimates (147 new homes
along with new commercial and improvements to existing buildings) but with a
commitment to closely monitor the situation and make adjustments as necessary. Staff
continues to work on commercial projects with much of that growth linked to bridge and
roadway improvements.
There was concern expressed about including in the budget an estimate that is not
realistic based on the housing market and projections. A shortfall would most likely have
to be absorbed by the city's fund reserves.
The council concurred that the budget should not reflect a permit revenue estimate that is
unrealistic and requested options to enable a reduction in that portion of the budget (not
including an increase in taxes). In order for staff to develop options for discussion, the
council agreed to set the revenue estimate at $600,000.
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CITY COUNCIL WORK SESSION September 4, 2007
APPROVED
1 Engineering Staff - Regarding the matter of a change to in-house engineering staff,
2 Community Development Director Grochala provided additional information comparing
3 budgets for in-house services versus by contract. Next year would be a transition year so
4 the figures for 2008 don't present a complete change. Some services such as plan review,
5 land use applications and development review could become in-house and would have a
6 revenue stream to the city's general fund. Staff has estimated the general engineering
7 costs to the city over the past three years because those costs are part of a larger
8 engineering budget. The average rate paid for contracted engineering staff is estimated at
9 about $98 per hour versus the proposed in-house budget of $53 per hour. The funding
10 source numbers used are very conservative. Director Grochala stated that he is basically
11 indifferent about the change since the city would be well served either way but there does
12 appear to be some potential for cost savings. He also added that TKDA has attempted to
13 present options to reduce the cost of their services to the city in reaction to the proposal to
14 go in-house. The proposal became a part of the budget when it was proposed by the
15 department as part of the 5 Year Plan.
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17 The council debated the process by which a change was brought forward and the
18 appropriateness of staff including the change in the proposed 2008 budget.
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20 There was some suggestion that discussion about a change had occurred without the
21 knowledge of the full council; Council Member O'Donnell requested that the record
22 reflect that he personally did not discuss the matter outside of official council sessions
23 other than to ask the city administrator one question the day previous.
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25 The council did not reach a decision on the engineering item. Finance Director Rolek
26 confirmed that the proposed budget figures could stand with either option mainly because
27 2008 was budgeted as a transition year. The revenue changes would have to be worked
28 out.
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30 The council will have a discussion of rebalancing the budget as all outstanding questions
31 are decided.
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33 Charter Commission - Charter Commissioners were present with a request for addition
34 of $5,000 to their 2008 budget. Charter Chair Cori Duffy stated that the current annual
35 budget of $1,500 is not adequate for this year's work level even though they've been very
36 cautious with the funding they have. They are working on charter amendment issues and
37 may require some legal expertise.
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39 The council concurred that the request is reasonable but confirmed that it wouldn't be an
40 eternal yearly addition to their budget. There may be an issue for 2007 funding and the
41 commission will inform the council when and if an adjustment is needed.
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CITY COUNCIL WORK SESSION September 4, 2007
APPROVED
1 Blue Heron Days — The festival group has submitted an official request for city funding
2 in the amount of $6,000 to support the Ambassador's Program. Finance Officer Rolek
3 explained that there is no specific funding included in the proposed budget for Blue
4 Heron Day; the council has previously provided some assistance with float maintenance
5 and waiver of fees.
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7 A discussion of what other communities contribute to festivals concluded that there is no
8 real standard.
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10 The council concurred that if the Blue Heron Days request is considered, other requests
11 should receive the same consideration. Some organizations that have requested funds
12 clearly provide public services while others not so. One source of funding that could be
13 considered this year is the returned hospital district funds.
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15 2007 Budget — Finance Director Rolek reported that the 2007 budget will be very tight to
16 the end; a review will occur before the end of the year.
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18 Attorney's Fees — Administrator Heitke updated the council on the possibility of an RFP
19 for attorney's services. It is still an item being considered for 2008. The proposed budget
20 doesn't reflect any major change at this time, however, cost is a driving factor for a
21 change.
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23 Valuation Update — Finance Director Rolek suggested that he will keep the valuation
24 information up to date based on what he receives from the county. The current estimate
25 was provided by the county.
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27 Utility Rates — Finance Director Rolek reminded the council that a utility rate study is
28 currently being done by Springsted, Inc. and will be available in time for adoption of the
29 final budget. The current approach is to remain revenue neutral and redistribute the rates
30 according to use, without accidentally penalizing typical use situations. The council
31 should see more information at the October work session.
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33 The council will have a general discussion about balancing the budget based on current
34 decisions at the next work session. Staff was requested to bring suggestions.
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36 These minutes were considered, corrected and approved at the regular Council meeting
37 held on September 24, 2007.
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42 u i. e Bartell, Ci , Cler John Bergeson, Mayor
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