CC PACKET 06092009 - Laserfiche WebLink

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MEMORANDUM DATE: June 3, 2009 TO: Mayor and Councilmembers FROM: Mike Morrison, City Manager Roger Larson, Finance Director ITEM: MARKET VALUE CREDIT/2009 BUDGET CUTS To help balance the State of Minnesota's budget deficit, the Governor's proposal includes cutting Local Government Aid and Market Value Credit to Minnesota Cities by 5.05%. If approved by the Legislature, the impact to St. Anthony would be a loss in Market Value Credit of $133,200 (the City has not received LGA since 2002). Anticipating the loss in Market Value Credit, the City Council directed Staff to examine their budgets and provide input on how to remove $13 5,000 from the budget. At the February 4th work session, Staff presented the removal of the Sewer Jetter from the Capital Equipment Budget ($150,000). Council expressed concern that it was not fair or prudent to penalize only the Public Works Department and wanted Staff to look at all areas of the budget. At the March 31St work session, Staff presented four options to the City Council: Option 41 - Cut the Capital Equipment Budget by $135,000 Option 92 - Cut the General Operating Budget by $135,000 Option #3 - Increase Taxes/Liquor Revenues by $135,000 Option #4 - Combination of Options #1, #2 and #3 At that meeting, the City Council directed Staff to have the cuts affect all Departments and could come from a combination of reductions to the General Operating and Capital Equipment Budgets. Their direction included goals to maintain the current level of service, continue to improve the efficiency of operations and the need to define the risks associated with the cuts. At the May 4th work session, Staff presented its recommendations which included reducing the General Operating Expenditures by $52,700 and eliminate or defer Capital Equipment purchases by $82,300. A summary of the adjustments is as follows: 1) General Government 2) Police 3) Fire 4) Public Works Total General Capital Operating Budget Equipment $15,300 $18,300 $11,000 $30,000 $ 7,100 $27,000 $19,300 $ 7,000 $52,700 $82,300 54