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City Council Regular Meeting Minutes April 26, 2011 Page 2 IV. PUBLIC HEARING. A. 2012 Budget. Mike Mornson, City Manager, and Roger Larson, Finance Director. presenting. 7 Mayor Faust opened the public hearing at 7:05 p.m. 8 9 City Manager Morrison stated that the public hearing is intended to obtain preliminary input as 10 the City enters the 2012 budgeting process. He presented an overview of the 2011 general 11 operating budget, the General Fund levy for 2011, and General Fund revenues and expenditures 12 for 2011. He stated that 54% of the City's revenues come from the tax levy and noted that 13 General Fund expenditures have remained consistent over the past ten years. 14 15 Mayor Faust pointed out that the City does not receive Local Government Aid (LGA). He stated 16 that while the General Fund levy has remained at 0% for the past several years, the City will 17 need to review the way it provides services to the community and whether it can sustain a 0% 18 increase in the tax levy for 2012. 19 20 No speakers were present. Mayor Faust closed the public hearing at 7:11 p.m. 21 22 V. REPORTS FROM COMMISSION AND STAFF. 23 24 None. 25 26 VI. GENERAL BUSINESS OF COUNCIL. 27 28 A. Ordinance 2011 -01: Amending the Tobacco Ordinance. Mike Mornson, City Manager, 29 presenting. 30 31 City Manager Morrison stated that this represents the Third and Final Reading of the proposed 32 amendments to the tobacco ordinance and presented the staff report, legal opinion from counsel, 33 list of current tobacco license holders, and proposed revisions to the ordinance. 34 35 Mr. Eric Brever, attorney for Flamezz Hookah, appeared before the City Council and reiterated 36 his client's objection to the proposed amendments. He stated the concept that somehow the 37 City's moratorium on June 22, 2010, provided his clients with notice that they should not have — 38 spent funds on the renovation is misleading. He stated that in order to qualify for a completed 39 license application, his clients had to spend the money up front and put $180,000 into the 40 renovation last year, well before the moratorium was put in place; as a result, it is misleading to 41 state that his clients should not have spent that money. He also addressed the double standard 42 argument and stated he and his clients are struggling as to what it means to have that double 43 standard. He indicated that the minutes from the last Council meeting include a discussion 44 regarding current licensees. He referenced § 144.4167, subd. 4, which requires in order for 45 sampling to occur in a tobacco shop, the tobacco shop must have 90% of its gross revenue from 46 tobacco sales, which would disqualify all other licensees in the City other than Flamezz and