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Mounds View City Council August 28, 2006 <br />Regular Meeting Page 12 <br />current recommendation is much more clear and concise. He stated that if it looks like the budget <br />will exceed the projected income, that in order for the City to do this without incurring an <br />additional $10,000 for a special election, the City needs to work on the budget earlier in the year <br />to ensure that the a ballot question will be ready for the election and a special election will not be <br />needed. <br />Mayor Marty stated he does not anticipate the problem arising in the near future, but possibly 10- <br />15years down the road, the cap on spending could be an issue. He stated his second concern is if <br />inflation increases significantly and if the inflation is up to or great than 10%, and if the City is <br />capped at 5% or the rate of inflation +2%, the city could be in a quandary. <br />William Werner, 2765 Sherwood Road, stated Mayor Marty's concerns could be discussed ahead <br />of time. He stated the Council needs to be frugal if inflation rises. <br />Councilmember Thomas stated that if the Council does what it needs to do, the numbers would <br />be in place in time for the City to react properly. She stated that if the inflation rate rises, the <br />City should consider cutting the budget before calling a special election. She stated that the City <br />would need some serious discussions if there is large inflation and that is the point of the Charter <br />language. <br />Mr. Werner stated he is disturbed that funds can be used to reduce the budget deficit. He stated <br />• such action should take place after the City meets the goal of the low percentage. He stated work <br />needs to be done to ensure that the inflation rate and potential shortfalls should be considered in <br />the initial budget, rather than using the general fund instead <br />Mayor Marty stated he would like the levy limit at 0% as long as possible. He stated that he <br />would like to guard the Ievy reduction fund to make it last as long as possible without having to <br />use it. He stated he would only like to use the levy reduction fund if it is absolutely necessary. <br />Mr. Werner stated that the Council should insist that the budget meets the criteria of 5% of <br />inflation +2% initially. Councilmember Flaherty responded that that is exactly what the Council <br />would like to do and is committed to such a plan. He stated the only item the City would use the <br />levy reduction fund if absolutely necessary. Councilmember Flaherty started that the budget is <br />prepared with that in place. <br />Councilmember Stigney asked which CPI would be used and asked if it should be identified or <br />footnoted. He also asked for clarification regarding the language "set limits, with any increases" <br />and stated he would like it to be singular, reading "increase." Councilmember Thomas stated <br />there are several funding sources and there are multiple issues. Councilmember Stigney clarified <br />that there is only one increase - 5% or the CPI + 2%. City Attorney Riggs stated that the word <br />increase is acceptable. <br />City Attorney Riggs responded that it is incumbent for people to look at the published change of <br />. the Charter. He noted the CPI is set out in the first chapter of the Charter. He stated the <br />proposed question is the best summation of the changes and that he is recommending approval. <br />