Agenda Packets - 2006/01/09 - Laserfiche WebLink

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Mounds View City Council December 5, 2005 Truth in Taxation Meeting Page 6 City Administrator Ulrich stated they do look at trend data, for example how much it costs to 1 plow streets, whether it is increasing or decreasing, and how to be more efficient. He advised 2 that the Council scrutinized each line item and challenged staff as to whether the activity had to 3 be undertaken or the item purchased. 4 5 Mayor Marty commended the Council for questioning a number of things, and line items, as the 6 budget has been reviewed. He noted that in the past he had suggestions or questioned things but 7 then it just moved on. However, with this Council it did not just move on and the item was 8 discussed as to merits. He stated there was good consensus and scrutiny on the budget being 9 considered tonight. 10 11 Finance Director Beer concurred, noting the Council even considered amounts as small as $200. 12 13 Mr. Glidden asked what determines the amount or percentage of increase in new budget, noting 14 budgets hardly ever go down. Councilmember Gunn stated the LGA cuts of $900,000 over the 15 last three years. 16 17 Mayor Marty concurred, noting that equaled 19% of the City’s budget. Now the City is receiving 18 no State assistance. 19 20 Councilmember Thomas stated Mr. Glidden is asking what raises budget items. She noted that 21 the loss of LGA is a revenue decrease and has nothing to do with an increase of a general fund 22 budget item for expenses. She explained that if an item is needed by a Department, that is where 23 an increase comes from. 24 25 Mr. Glidden asked if those items are also scrutinized. Councilmember Thomas stated they are 26 scrutinized item by item and in recent years have involved mostly personnel costs and insurance. 27 28 Finance Director Beer stated 55% of the budget is personnel and 23% is contractural services so 29 inflation drives the increases there considerably. He noted there was a 7.5% increase in health 30 insurance this year and the salary increases were at about the same rate of inflation. He 31 explained that for three-fourths of the budget, the union contract and contractural services dictate 32 what their increases are, noting fire service went up 5.25% this year. 33 34 Councilmember Flaherty stated people get pay raises, the Council had to look at the considerable 35 increase in gas prices, and they also looked at capital expenditures and whether a vehicle is 36 needed. That is what causes a budget to increase, noting the Council does not have much control 37 over wages and insurance premium increases. 38 39 Mr. Glidden asked who balances the cost projections, the required budget amount, against what 40 the tax revenue is going to be. Councilmember Thomas stated the Council does that activity. 41 42 Finance Director Beer explained that the Council started with 8% as the proposed amount of 43 property tax increase. Councilmember Thomas stated that is correct and the Council adjusted it 44 to zero. 45