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• y, City of Mounds View Staff Report Item No: 8F Meeting Date: December 13, 20T1 Type of Business: Council Business City Administrator Review: To: Honorable Mayor and City Council From: Nyle Zikmund, City Administrator Item Title/Subject: Charter Commission Resolution 2021-04 Amending Chapter 7.03 of the Mounds View Charter Introduction/History: According to the League of Minnesota Cities there are just over 100 (102) cities that operate under a Charter (from a universe of 785 cities) with two of those, Mounds View and Fridley, containing an operating levy clause. Of the two, Mounds View is dramatically more restrictive (Fridley's was more restrictive until a change was made several years ago.) The Mounds View Charter Commission was formed in 1978 with its first meeting occurring on November 4, 1978. The Commission was formed by a group of residents opposed to a proposed $6.5 million storm water system and despite the council defeating the proposal on a 3-2 vote; correspondence from the time indicates the commission wanted to exert greater authority over the council, including ability to recall members who might have different viewpoints. The first "Charter" was adopted on October 11, 1979. In January of 2008, Chapter 7 (Taxation and Finances) Section 7.03. Subdivision 1 was amended by adding language limiting the general levy increase to 2% over the previous year's general levy plus inflation not to exceed 5%. This language remains in place today. Of historical note, this change occurred immediately following the State of Minnesota's dramatic reduction in Local Government Aid due to economic conditions. In turn, the City of Mounds View was faced with draconian staffing cuts as personnel comprise over 60% of the budget. With contractual services consuming another 20+%, the council enacted double digit budget increases for three consecutive years. In January of 2021, the Commission undertook a review of Chapter 7. Mounds View Finance Director Mark Beer was invited to the April 27th Commission meeting to detail the impacts of the levy provision, both short and long term. The Commission approved three options to amend the increase language that would be discussed at a joint meeting of the Commission and the Council: 1. Greater of 8% or CPI 2. Lesser of 6% or CPI plus 4% 3. Greater of 6% or CPI plus 2% On June 22, 2021, the Commission met with Council in a joint workshop to discuss the options. The Commission met again on August 17, 2021 to discuss further, and based on the discussion at the joint meeting, worked on a proposal modeled upon Fridley's charter which establishes a base increase but allows additional increases with a super majority vote of the city council. A motion was made to amend Chapter 7 to allow Council to: The Mounds View Vision A Thriving Desirable Community