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Council Meeting Minutes for July 7, 2025 <br />Page 2 of 9 <br />primarily due to the receipt of ARPA funds the prior year. Investment income improved in 2024 <br />due to favorable market conditions. <br /> <br />General government expenses increased by 8%, mainly due to higher contract engineering and <br />other professional service fees. This category has shown a steady upward trend each year. <br />Public safety expenses rose by 11%, attributed to an increase in the Washington County Sheriff <br />contract and having a full-time fire chief for the entire year. Highways and streets expenses <br />increased by 5%, primarily from enhanced maintenance activities, including siren repairs, street <br />lighting, and concrete work. Park maintenance expenses decreased by 8%, mainly due to reduced <br />personnel costs. Jill displayed a pie chart illustrating that the majority of expenses were for <br />public safety and general government functions. The distribution remained similar to previous <br />years. <br /> <br />Jill explained the purpose and benefit of general fund reserves and referenced the 2008 tornado <br />as an example of why maintaining strong reserves is important for timely response to <br />emergencies. The City’s reserve balance was approximately 69% of total expenditures. The State <br />Auditor recommends a reserve level of 35–50%; Hugo's reserve is about 50% of the next year’s <br />budget. <br /> <br />The five-year debt service showed a slight decrease. Capital project activity dropped in 2024. <br />Significant projects were done in 2021 and 2022, particularly the Public Works facility and <br />Lions Park. Jill talked about Enterprise Funds, which included water, sewer, and related <br />construction fees saying they fluctuate from year to year, and the revenue increase was fairly the <br />same as last year. <br /> <br />Jill concluded by saying the City was issued an unmodified audit opinion with no Minnesota <br />legal compliance exceptions. The Annual Comprehensive Financial Report was posted on the <br />City’s website and available in the Finance Directors office. Summary financials will also be <br />published in the city’s official newspaper <br /> <br />Weidt made motion¸ Petryk seconded, to accept the findings of the audit. <br /> <br />All Ayes. Motion carried. <br /> <br />Approval of Consent Agenda <br /> <br /> Krull made motion, Miron seconded, to approve the following Consent Agenda: <br /> <br />1. Approve Claims Roster <br />2. Approve Annual Performance Review for Public Works Worker Jeff Maas <br />3. Approve Hiring of Mason Libke as New Building Inspector <br />4. Approve Hiring of Mike Perron as New Public Works Worker <br />5. Approve Resignation of Utility Lead Worker Rick Fox <br />6. Approve Internal Advertisement for Public Works Lead Utility Worker Position <br />7. Approve Transfer of Ownership of AED to the Hugo Fire Department from the Hugo <br />Good Neighbors Food Shelf <br />8. Approve Hugo Firefighter’s Relief Association Request for Increase in Lump-Sum Pension