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A-1 DOCSOPEN\MU210\4\780657.v4-2/17/22 Exhibit A Background Information Provided by City Administrator Nyle Zikmund. For more than a decade the City has been unable to meet the service demands of our residents due to its charter levy provision. Of the 853 cities in the State of Minnesota, just over 100 have charters and of those, only 2 have a charter cap levy provision; Mounds View and Fridley. The Mounds View provision is so restrictive that the City is and has been unable to hire a full-time employee absent a voter approved referendum, no other city in the State of Minnesota operates under this restriction. Further, increasing regulatory costs, aging infrastructure, and contractual services have increased greater than the rate of inflation. Our sanitary sewer fee to the Met Council is just over $1 million per year. The city is in the midst of a $6 million upgrade to its municipal drinking water plants, all of it related to treatment as more contaminants find their way into our groundwater supplies needing additional cleaning and treatment to ensure safe drinking water. For more than a decade the City has been challenged with using reserves to balance the budget, undertaking the elimination of programs or termination of staff. The challenges are significant as evidenced by the annual reserve contribution is equal to a 4-5% levy amount. Measured in impact it would be a 20% reduction of Public Works staff, 15% reduction in Police Staff, or elimination of the Park and Recreation Programs and Community Center. Since January of 2021, the Charter Commission has been discussing easing of the levy provision contained in Chapter 7, and discussed it in depth at their March 23rd meeting and again at their April 27th meeting where Finance Director Mark Beer provided substantive detail on the looming challenge. In June of 2021, the Commission met with the Council in a workshop setting to discuss their progress and obtain feedback from the council. After further discussion at their September and November meetings, the Commission passed a resolution on a 6-3 vote to amend the levy language and move it forward via the ordinance process, which is one of multiple ways detailed in State Statute to amend a local charter. Once the resolution was adopted and presented to the City, a timeline is set forth in state statue requiring notification of a required hearing and publication of the Ordinance. The public hearing occurred on December 13, 2021, and subsequently the Council adopted the ordinance by a unanimous vote, a required component of the statute when amending the charter by ordinance. The ordinance was published on December 21, 2021, and this publication started the timeline for a petition to be submitted. Those wishing to have the ordinance put to a vote have the right to file a petition by a date certain with a requisite number of signatures detailed in statute. In this case, that day is February 22, 2022. Upon receipt the City must determine sufficiency. When a petition is submitted, if determined insufficient, petitioners have time to file an amended petition and may have the opportunity to submit an entirely new petition. If a sufficient petition is filed in accordance with statutory timelines, the ordinance is returned to the Council for further action which includes placing it on the ballot at the next general election, calling for a special election, or they could determine to go in a different direction which includes the option of abandoning the effort. If no valid petition is received, the ordinance then becomes effective 90 days after publication. That day is March 21, 2022. If a new petition is not received by February 22, 2022, and the ordinance becomes effective March 21, 2022, those who still would like to pose the question related to the levy increases still have the opportunity