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Mounds View City Council September 14,2009 Regular Meeting Page 4 fund for its created purpose instead of getting more from the taxpayer. He noted the branding project, which he did not support, cost $23,500 and is yet to be implemented and he believed it was also a mistake to reduce the franchise fee. Council Member Hull stated that the economy might be worse next year so if some funds are taken now, the fund will be depleted sooner, leaving a "hole" in the budget. He agreed with Mayor Flaherty that it would be best to use a little at a time. Council Member Stigney stated the projections are unknown and next year the LGA may come back. He noted that for now, the City has funds to offset a levy increase and when no funds are available,then it can be addressed with the residents. Council Member Hull explained that because of the number of unknowns, he wants to be even more conservative in using the levy reduction fund. Council Member Stigney stated no matter how it is spent, the fund would be exhausted eventually. He stated staff and the Council have to examine expenditures each year but this year the City has funds available. Mayor Flaherty reviewed that when the levy reduction fund was first formed, it was the prevailing opinion the fund had to be retained until 2032 when the Medtronic TIF district expires. Council Member Gunn reminded all that this action will set the maximum levy increase and the Council has until December to decide whether to drop the percentage. Council Member Mueller stated she does not support the amendment, noting that for the last four to five years there has been a zero percent levy increase by using the levy reduction fund, which was prudent because the principal was not used. This would be the first year that in spite of reducing the levy back to 2008 numbers, utilizing funds those funds will dip into the principle_ She felt that a 1%increase was a small price to pay to retain services enjoyed in the community. Aye— 1 (Stigney) Nays—4 Amendment failed. Council Member Stigney stated nothing was "cast in stone" to spend only the accrued interest and not principal. He noted the CPI resulted in lowering the increase to 1%; otherwise, the levy increase would have been over 2%. Ayes—4 Nay— 1 (Stigney) Motion carried. Mrs. Werner suggested the Council is establishing a precedence to increase the levy each year. She complimented the City, staff, and contractors on the beautiful street project. B. Resolution 7495, a Resolution Establishing Public Hearing Dates for the Proposed General Fund Budget and Property Tax Levy for Fiscal Year 2010.