HomeMy WebLinkAboutAgenda Packets - 2021/04/19
CITY OF MOUNDS VIEW
CITY COUNCIL BUDGET RETREAT
COMMUNITY CENTER
Monday, April 19, 2021
6:30 p.m.
AGENDA
1. General Discussion regarding 2022 General Fund Operating Budget
CITY OF MOUNDS VIEW
Item No. 1.
Meeting Date: April 19, 2021
Type of Business: Council Budget Retreat
City Administrator Review: ______
City of Mounds View Staff Report
To: Honorable Mayor and City Council
From: Mark Beer, Finance Director
Item Title/Subject: Discussion of Priorities for the 2022 General Fund Budget
City staff has been busy working on the details of the 2022 budget.
This item is placed on the agenda to give the City Council and residents the opportunity to provide input to staff
early in the process. Department Heads can then use this guidance as they work on the details of their proposed
budgets.
General Fund 2021 Budget by Type
Personnel 62.1%4,876,077
Contractual services 21.9%1,718,845
Capital outlays 0.1%7,560
Supplies 4.1%322,993
Transfers 9.9%774,000
Fire debt service 2.0%158,372
Total 100%7,857,847
General Fund 2021 Budget by Function
Police 43.8%3,442,885
Public Works 10.9%859,276
Park and Recreation 6.6%521,307
Fire (SBM)6.1%476,849
Community Development 6.1%477,040
Administration 4.4%346,987
Finance 3.8%294,777
Central Services 4.0%312,459
Debt Service (Fire bonds)2.0%158,372
Misc. Contracual Service 1.3%105,656
Legislative 1.1%88,239
Transfers to other funds 9.9%774,000
Total 100%7,857,847
General Fund 2021 Budget by Revenue Source
Taxes (property)70.21%5,202,295
Other taxes (hotel, mfg home)1.03%76,000
Intergovernmental 12.90%956,075
Franchise fees 4.12%305,000
Licenses and Permits 3.32%245,872
Charges for Service 0.33%24,625
Fines and Forfeits 0.46%33,750
Investment earnings 0.81%60,000
Miscellaneous 4.02%298,162
Transfers In 2.80%207,533
Total 100.00%7,409,312
Key 2022 Budget Issues:
The February state budget forecast projects a surplus of $1.57 billion for the next biennium (begins July 1, 2021
thru June 30, 2023). Local Government Aid was projected to increase minimally. In our case, the 2022 amount
was estimated to be $846,417 under current law compared with $844,418 in 2021. Future economic conditions
may change this and we will have to wait for the legislature as no budget items have been passed. The state has
a reserve of 2.377 billion and a cashflow reserve of 350 million. The state is required under current law to use
$491 million of the reserve towards the 2022/2023 budget but that could change. The state legislature is
scheduled to adjourn on May 17. The City Council budgeted for 50% of anticipated LGA for 2021 to guard against
any legislative cuts or economic weakness associated with the state budget.
Inflation is modest at present. (1.3%) Inflation is a wild card in the second half of the year, the Federal Reserve
and the Congress are pumping a lot of stimulus into the economy which could have an inflationary effect in future
quarters. The City’s charter cap would allow a levy increase of 2% plus inflation up to 5% but excludes debt service
levies, voter approved levies, and capital project levies from inclusion in the cap calculation. A 1% levy increase
would generate an additional $58,663 in tax revenue. Property taxes account for 70.21% of General Fund
revenues and operating transfers in. Ramsey County will provide preliminary 2022 values and projections in late
August.
The City has settled contracts thru 2022 with the two police unions and the public works bargaining group. The
contracts provided for a 3.0% cost of living adjustment in 2022. 23 employees will receive step or longevity
increases in 2022 of 2% to 10% in addition to the COLA. We will need to determine if we are pay equitable and
that could have a nominal impact on the 2022 budget. Health insurance premium increases are not known, we
have been a small group (age rated premiums) but will be a large group in 2022 (experience rated premiums) this
could have a larger than expected increase in premiums. We will receive our rate notice in October. The impact
to the budget will depend upon the size of the unknown rate increase. The City’s health insurance contribution
increased $15 in 2021 to $1,170 per month compared with $30 in 2020.
The employer’s share of PERA will remain at 7.50% for General (non-police) plan members, the PERA General rate
has increased from 5.53% in 2005 to 7.50% in 2015. The Police plan will remain at 17.7%. The police PERA rate
has increased from 9.3% in 2005 to 17.7% in 2020. Current PERA pensions are funded at 79.06% for General
Employees Retirement Fund and 87.19% for Police and Fire Retirement Fund. A liability has been recognized in
the entity-wide financial statements, (General $1,672,733, Police 2,231,555) as a result of implementing GASB
Statement 68. The state legislature controls the resolution of the underfunded pensions.
The payroll cost for 52.5 FT 9 seasonal employees is $3,317 per hour, $26,539 per day, $132,693 per 40 hour week
and $6,900,049 per year. Work comp will decrease by $1,681 due to a decrease in our experience mod from 1.07
to 1.00. Overall, pay and benefit costs will increase by approximately $371,365 across all funds and $260,704 for
the General Fund.
County dispatch fees were $102,053 in 2021. The 2021 fee increased $5,245 or 5.42% from the prior year, we
have not received the 2022 amounts.
The Fire department will have a 2% to 4% increase in operating costs and a larger capital outlay expense for 2022.
Our share will be mitigated somewhat by a switch to a fixed percentage formula going forward. (2021 – 15.5%,
2020 – 15.998%, 2019 – 16.373%, 2018 – 16.158%, 2017 – 15.819%)
Information technology costs (phones, computers, copiers, cameras, squad computers, network switches, desktop
services, virtual servers, internet, email, software, laserfiche, anti-virus, VPN connections, and facility WiFi) will
increase by 5-7% due to additional services and transition to a joint powers entity away from the City of Roseville.
This moves Roseville employees to the joint powers entity for long term stability and continuity. This continues
to be an excellent value for the City.
Fuel prices were budgeted at $2.30 for 2021, with the current economic conditions staff is recommending $2.75
for 2022.
Overall most revenues that are tied to economic activity will be improving over 2021. Investment income will
decline in 2022 as a result of Federal Reserve activities and impacts from the pandemic. The franchise fee rate is
at 4.00%, the revenue is split between the General fund and the Street Improvement fund.
The City will receive American Rescue Plan Act Funds in 2 allocations, May/June of 2021 ($750,000) and May/June
2022 ($750,000) based on preliminary estimates. U.S. Treasury guidance will be forthcoming on eligible
expenses/revenue recovery.
2020 General Fund unassigned fund balance is $4,662,432 this represents 63.76% of 2021 budgeted revenues and
transfers compared with 55.50% for the prior year. The City received an unbudgeted CARES Act grant of $1.004
million which increased fund balance by $553,761. The General Fund also has Assigned fund balance for Levy
Reduction of $5,033,580, and $448,535 to balance the subsequent budget. It has been the Council’s policy to
draw down the levy reduction funds over time.
The City Council adopted a strategic plan for 2020 thru 2022. One of the City’s strategic goals is to develop a
balanced budget and reduce reliance on the Levy Reduction Assigned Fund balance and LGA by 3% to 5% from
2020 thru 2022. The General Fund deficit will be $500,000 to $600,000 this will be partially offset by the drawdown
of assigned (levy reduction) funds of $238,000 which reflects the strategic goal. This will leave a deficit of
approximately $262,000 to $362,000 before considering any expenditure reductions, use of fund balance or a levy
increase.
Conclusion
Staff is looking for direction from the Council on priorities for the budget and property tax levy. The above items
are some of the issues that will drive the 2022 budget and are presented for your consideration.
Respectfully Submitted,
Mark Beer
4/15/2021 8:00 AM
City of Mounds View
2022 Budget Summary
2018 2019 2020 2021 2022 Change from 2020
General Fund:Actual Actual Actual Budget Request Dollar Percent
Revenues:
Property taxes - Base levy 4,082,924 4,245,901 4,516,708 4,666,859 4,666,859 - 0.00%
Special tax levies, Bonds 90,835 165,800 171,190 166,291 165,915 (376) -0.23%
Special tax levies, Operations 244,145 349,145 369,145 369,145 389,145 20,000 5.42%
Franchise tax 338,919 308,835 301,755 305,000 305,000 - 0.00%
Other taxes 23,046 26,477 29,309 26,000 26,000 - 0.00%
Hotel/motel tax 77,115 71,957 29,264 50,000 50,000 - 0.00%
Licenses and permits 312,047 348,201 269,447 245,872 245,872 - 0.00%
Intergovernmental 1,229,019 1,303,053 2,419,722 956,075 1,250,266 294,191 30.77%
Charges for services 23,736 38,007 60,384 24,625 24,625 - 0.00%
Fines & forfeitures 35,800 46,098 25,596 33,750 33,750 - 0.00%
Interest 157,074 316,381 196,579 60,000 75,000 15,000 25.00%
Miscellaneous 304,719 323,497 310,601 298,162 274,621 (23,541) -7.90%
Transfers:
Water Fund 78,103 80,446 82,859 85,345 87,905 2,560 3.00%
Sewer Fund 61,860 80,446 82,859 85,345 87,905 2,560 3.00%
Storm Water Fund 8,067 8,309 8,558 8,815 9,079 264 2.99%
Street Light Fund 2,771 2,854 2,940 3,028 3,119 91 3.01%
Vehicle & Equipment Fund - - - 25,000 26,000 1,000 4.00%
Debt proceeds 175,191 - - - - - 0.00%
Total revenues 7,245,371 7,715,407 8,876,916 7,409,312 7,721,061 311,749 4.21%
Expenditures:
Legislative Services:
City Council 58,903 58,013 50,168 62,239 62,239 - 0.00%
Advisory Commissions 15,352 39,379 3,900 26,000 24,850 (1,150) -4.42%
Subtotal 74,255 97,392 54,068 88,239 87,089 (1,150) -1.30%
Administrative Services:
City Administrator 286,882 305,115 307,051 310,722 334,223 23,501 7.56%
Elections 33,460 26,954 27,023 36,265 36,265 - 0.00%
Finance 268,325 274,866 282,535 294,777 306,737 11,960 4.06%
Central Services 261,610 298,124 252,163 312,459 312,459 - 0.00%
Subtotal 850,277 905,059 868,772 954,223 989,684 35,461 3.72%
Community Development 435,152 441,676 417,362 477,040 506,722 29,682 6.22%
Police 2,969,790 3,325,570 3,258,674 3,442,885 3,602,830 159,945 4.65%
Fire 802,223 693,855 685,219 635,221 711,497 76,276 12.01%
Public Works Administration 149,353 153,706 118,975 123,606 128,439 4,833 3.91%
Parks, Recreation & Forestry:
Recreation 123,961 125,940 96,795 - - - 0.00%
Parks 286,911 342,429 399,410 467,094 485,139 18,045 3.86%
Forestry 36,836 44,185 64,092 54,213 54,940 727 1.34%
Subtotal 447,708 512,554 560,297 521,307 540,079 18,772 3.60%
Fleet Services:
Building & Grounds Mtnce 144,415 143,343 171,071 153,709 154,108 399 0.26%
Vehicle & Equipment Mtnce 124,811 113,381 136,106 132,526 135,663 3,137 2.37%
Subtotal 269,226 256,724 307,177 286,235 289,771 3,536 1.24%
Streets:
Pavement Management 205,269 234,368 218,179 226,268 237,013 10,745 4.75%
Snow & Ice Control 168,529 177,992 161,346 154,884 160,737 5,853 3.78%
Sign Maintenance 47,325 47,318 42,676 68,283 70,266 1,983 2.90%
Subtotal 421,123 459,678 422,201 449,435 468,016 18,581 4.13%
Other
Convention & Visitor's Bureau 73,260 65,455 29,314 47,500 47,500 - 0.00%
Social Service Coordination 20,748 35,329 57,054 51,656 53,206 1,550 3.00%
Miscellaneous/contingency 3,766 3,662 3,574 6,500 6,500 - 0.00%
Transfers to other funds 640,000 690,000 1,374,000 774,000 775,000 1,000 0.13%
Debt service 24,495 24,495 166,468 - - - 0.00%
Subtotal 762,269 818,941 1,630,410 879,656 882,206 2,550 0.29%
Total expenditures 7,181,376 7,665,155 8,323,155 7,857,847 8,206,333 348,486 4.43%
Net change in fund balance 63,995 50,252 553,761 (448,535) (485,272) (36,737)
Beginning Fund Balance 9,476,539 9,445,463 9,476,539 10,030,300 9,581,765
Ending Fund Balance 9,540,534 9,495,715 10,030,300 9,581,765 9,096,493 (36,737)
4/15/2021 8:00 AM
City of Mounds View
GENERAL FUND
2022 Budget Summary
Community Park Public 2022 2021 Percent
Legislative Admin Finance Central Development Police Fire & Rec Works Misc.Total Total Variance Change
Current
Personnel services 39,173$ 325,053$ 283,289$ -$ 463,924$ 3,113,878$ -$ 365,355$ 539,615$ 6,500$ 5,136,787$ 4,876,077$ 260,710$ 5.35%
Materials & supplies 3,450 1,310 1,150 40,090 3,830 84,315 - 57,148 141,650 - 332,943 322,993 9,950 3.08%
Contractual services 44,466 44,125 22,298 272,369 38,968 404,637 469,620 117,576 204,961 100,706 1,719,726 1,718,845 881 0.05%
Contingency - - - - - - - - - - - - - 0.00%
Current total 87,089 370,488 306,737 312,459 506,722 3,602,830 469,620 540,079 886,226 107,206 7,189,456 6,917,915 271,541 3.93%
Other
Principal - - - - - - 148,025 - - - 148,025 144,150 3,875 2.69%
Interest - - - - - - 10,260 - - - 10,260 14,222 (3,962) -27.86%
Capital outlays - - - - - - 83,592 - - - 83,592 7,560 76,032 1005.71%
Transfers to other funds - - - - - - - - - 775,000 775,000 774,000 1,000 0.13%
Other total - - - - - - 241,877 - - 775,000 1,016,877 939,932 76,945 8.19%
Department Total 87,089$ 370,488$ 306,737$ 312,459$ 506,722$ 3,602,830$ 711,497$ 540,079$ 886,226$ 882,206$ 8,206,333$ 7,857,847$ 348,486$ 4.43%
2021 Budget 88,239 346,987 294,777 312,459 477,040 3,442,885 635,221 521,307 859,276 879,656 7,857,847
Increase (Decrease)(1,150)23,501 11,960 0 29,682 159,945 76,276 18,772 26,950 2,550 348,486
Percent change -1.30%6.77%4.06%0.00%6.22%4.65%12.01%3.60%3.14%0.29%4.43%