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HomeMy WebLinkAboutItem 06.dCITY OF LAKEVILLE CITY COUNCIL WORK SESSION MINUTES Wednesday, July 24, 2013 Mayor Little called the meeting to order at 6:30 p.m. in the Marion Conference Room at City Hall. Council Members Present: Swecker, LaBeau, Anderson, and Davis, and Mayor Little Staff Present: Steve Mielke, City Administrator; Dennis P iV irector; Julie Werner, Accounting; Tom Nesseth, Accountant; Judi ins, Dty Clerk 2. Citizen Comments There were no citizen comments. 3. 2014 -15 Budget Review Steve Mielke described the budget process and h ent events aiitions in the community will help to influence the budget. thr the budget' zscussion is more about the concepts and less about the actual • em ers will be asked to focus on more budget numbers at the u d work p for the adoption of the preliminary budget A n additiona� b,' t work s" w on d of September 9 has been set aside for further discussions, it i nary, sot e p't y budget and tax levy can be adopted on September 16. Sta Z asked to consider department needs and current trends when x raft pr ry budgets. At the September 16 meeting Council w r opt a ma ' vy, wh o down from that point but cannot go up. Final b get adoption will t cc at th cond regular meeting in December. fna rector Dennis Feller vided an overview of the 2014 -2015 Budget an Tax evy. Severa ake up a balan v budget including revenues and expenditures, taxes and services, s1i. and lon rm interest. Feller reviewed different types of statistics for measuring pro th, dget process: 1) General Fund expenditures per capita are the same in 2014 as t e in 2008. A 3.5% per capita spending increase is anticipated from 2013 to 2014, some which is offset by charges for services and permit revenues. Current number of employees per 1,000 residents is 2.7, down from 3.1 prior to the recession. With the addition of the new positions being proposed, the ratio will remain at 2.7:1,000. Per capita taxes for Operations (general fund, equipment and building fund) are proposed to increase by 3.6% in 2014 and 3.2% in 2015. This equates to $294 per capita in 2014 and $304 per capita in 2015. At the beginning of the recession in 2008 the figure was $312. City Council Work Session July 24, 2013 Page 12 Feller discussed several themes which have emerged from the budget discussions thus far. The five external factors are: Resumption of growth, emerging trends, addressing aging infrastructure, inflationary pressures, and legislative mandates. The organizational themes include: Innovation and efficiencies, entrepreneurial efforts, and preparing for the future. Resumption of Growth: Lakeville is seeing positive economic indicators including an increase in new residential housing construction and median home prices. Unemploy is ode easing. Growth raises demands for service delivery, impacts infrastructur an eases operation costs. Future capital improvements will include water s tem and t facility expansion, and several road upgrades. The budget curr ropnses th fon ofeveral new positions: N Police Department: Investigator in 2014 and police to keep up with the growth of the City. Two seasonal CSO's in 2 Building Inspections: Part -time code enforcem w ee in 2014. position was eliminated several years ago an building inspections department. A 24 -ho budget, which would free up time for Lill believes the iPads being proposedvi ; save the positions are needed .ssistein the parks. Enforcement d to the hO cer is being proposed in the MCP on inspections. LaBeau office staff a considerable amount of time. Engineering hd would assist to Mielke added that in 2014. Engineering of the street >sition would assist with the reconstruction on inspections related work such as site cost for street reconstruction is offset by f are part of the proje wecker asked if the pay grade for this position is at the higher r end of the scal ' eller stated that this is a highly skilled position, but is budgeted arting pay de. Fleet Manage e pervisor in 2014. Personnel have not been added to this division for many years. T ervisor position will be responsible for inventory management and control. This will i'ow the Fleet Lead to spend more time doing mechanical work. LaBeau asked if there were any examples of when this type of position could have been financially beneficial to the City. Anderson asked if new vehicle technology has decreased the amount of time needed for maintenance. Fire Department: Assistant Fire Chief in 2015. Assistant Fire Chief Position is being proposed in 2015 and will assist with training volunteers, among other duties. This position will be a trained firefighter who will strengthen daytime call response. City Council Work Session July 24, 2013 is being Anderson suggested more data and information would be helpful in understanding why certain positions are needed. He stated that with added technology and good use of resources a growing population might not necessary equate to a larger staff. Mielke stated that future discussions could focus on staffing levels and expectations of both the Council and residents. For example, several miles of new streets are being added and if Council wishes to continue the current level of snow plowing service, an additional employee may need to be added in the future. Council's role is to determine the level of service which is being delivered. Emerging Trends Additional forensics software is proposed to assist the it in order to provide more timely crime investigating of c crimes. Swecker suggested more employees need to be i In order to address increased public activities under cor Park, as well as the rest of the park system, it is being re( CSO's for a uniformed presence in those are could bean option. Mielke believes it is imp ant t was also suggested that parking fees could b arge t rental of the concession stand or some,re th tof Emerald Ash Borer. A full -time assist with the EAB outbreak wli $45,000 be comm expe�i overview of td1 - OK cnrrertI y bet )etter served with Page 13 ator o digital forensics ally to ologyeiated this field rs Park and Casperson M nre t o seasonal d a re i e£nonitored camera soimel -' he boat launch. It rs.nderson also suggested presence at the park. Environmental Resources to Ile. Staff is also recommending will be incurred for City trees. Mielke provided an ak out of the budget several years ago. I ids tree companies with their questions but f foster. Swecker asked about sharing a forester t HiPP initiative, Mie tated that the larger surrounding communities each have a ores taff. Council exp �. e o d a desire to learn more about the disease and what can be dne. LaBeau state ' g -rge planning might be needed after the final results of Envision Lakeville are det' y 'Little stated that a process for responding to citizens should be put in place so concern d resident issues and trends can be tracked and follow up ensured. This would be esp6cially helpful when dealing with recurring issues. He is currently using a Google document but believes there is a better method. Mielke stated software tracking systems are available for such things as maintenance requests; however, if a constituent is lobbying a council member for a certain position, that is a different type of contact. If a central mailbox is created, Council members need to be cognizant of open meeting laws. Anderson asked about the marketing funds and stated that the Envisioning Process priorities include attracting new business and supporting current businesses. LaBeau asked if any new City Council Work Session July 24, 2013 Page 14 businesses have come to Lakeville as a result of recent Positioned to Thrive marketing initiative. Mielke stated that at this time there is no measurable outcome identified. Todd Bornhauser, Lakeville Area Chamber of Commerce Executive Director, stated that because of different dynamics, it's difficult to make comparisons with other communities such as Shakopee. Mielke stated that more outreach is being done with businesses but would like to see development of relationships with landowners to enhance marketing efforts. Addressing Aging Infrastructure Facilities: The five -year plan is $1.4 M, financed from o rev' .These are major maintenance projects and the figure does not include a „ new facil' uction. Maintenance was taken from the General Fund last yea 'cee e tax le v, AD.A improvements will be accomplished as facilities are expa paid with ids. A schedule showing the impact of interest rates on future t complete stir°" reconstruction projects was distributed. Feller believes that big rest rates are inevitable and should be built into the budget. If Council de Ines that the f pay -as- you -go financing is achieved, the interest rates would} for Council discussed the accelerated street rec uc�On pro — d d various scenarios for financing the projects. Swecker state t previo Coun • sMave attempted to keep the tax levy as stable as possible and spr ` i g the costs o ars rather than 10 years would accomplish that stability. And ted that de e hrg roads are detrimental to the community in s n the nificant value in accelerating the street reconstruc ' riod. greed to move forward with the accelerated street r struction progra work t a pay -as- you -go financing program. Little a, w feasible it is should ouncil decide on an even higher annual reconstruction hould be considered: street reconstruction. Mielke stated that limited staff re Id be prohibitiv Water main ents be needed and will be partially funded by water rate increases. The last paymen - -: - 00 on the park bond referendum will be made in 2014. In 2015 it is proposed that th unds will be redirected to a revolving capital program for playground replacement. Unencumbered funds were set aside for a trail maintenance fund several years ago. Council will continue working on the Park Plan update following the Envision Lakeville process. Council would like to see an average cost per mile for maintenance of trails. Mielke stated that the Park Director is working on providing this information. Total estimated equipment acquisitions over five years beginning in 2015 is $12.7 million. The amount varies due to the replacement schedule. The major funding sources are Liquor City Council Work Session July 24, 2013 Page 15 Funds, unencumbered General Fund monies, and property tax levy. Anderson asked if there is a method of determining what would be eliminated from the budget if the funds were not available. Feller stated that if funds were not available it would be necessary for Council to look at projected life of equipment and make choices regarding purchases. Council would like to receive a copy of the full equipment replacement schedule. Inflationary Pressures The declining unemployment rates will create upward press n " ges. # contingency has been included in the budget for potential wages adjustor o cy is also included for health care costs which will be influenced by industr trends ands xperience. Employee incentives are being offered to help control c Fir rghter calls ;Iid training is proposed to increase in 2014 and 2015; fundin e from the nd. Sanitary sewer rates being charged by MCES are estimate -ase by 3.5 pe" if 't per year. Legislative Mandates and Changes Legislative changes regarding sales tax exemp ension fina = fig and property tax a.. levy limits as well as federal sequestering an he EP . atAr regulations will impact City finances. The sales tax exemption a pl ro p ` chases i ds and services only but does not apply to the purchase of m hicles o iquortoPe operations. Innovation and Efficiencies " The current Co ispa D) system is out of date and in danger of being unable to b - 7 aiii and F1 process of replacing the existing mobile compuand records man t syste enhance technology tools. Poli `'oice recognition reco are bei g proposed by the police department to allow o roduce reports in a re efficient manner. Sweck - "' about water me = modernization. Feller stated that more advanced radio read technolo g used for - residential accounts and is proposed to be installed for residential cu in t . "doming years, which will make the process more efficient. Park mowers are•) oposed for purchase rather than lease, since it has become more cost effective. Entrepreneurial Efforts A Liquor business plan is being developed. There are no funds currently in the budget for either a new store or a store relocation. The Heritage Store lease is up in 2015. Electronic signage is being proposed for the corner of City Hall which would advertise upcoming events and community activities. Council member expressed that they are not in favor of this signage. City Council Work Session July 24, 2013 Page 16 Items proposed for the Heritage Center will enhance the facility for rentals and make it more functional for activities. Improvements would include AV equipment, ice machine, chairs and tables, and exterior lighting. Swecker stated that she is unable to support additional funding until the previous improvements are paid for. She will assist with trying to get some of the needed items donated. Mielke pointed out that the proposals are for operations rather than construction. Anderson would like to see more data. Preparing for the Future Funds are proposed to complete the Envision Lakeville establish specific steps to take as a result of the informa Dakota County will continue the County Road 50 stud Avenue. The City's share is estimated at $45,000 to be Hydrological modeling of the North Creek drainage an modeling and flood mitigation initiatives. The Urban Reserve Plan study is proposed for 201 Comprehensive Plan update in 2016 -17. The budget includes an increase in professio 1 devel succession plan. Volunteer firefighters will ,t ',ha4 -an la' " "process and to that haw ered. use from I7' lvd to Cedar from genera X014. ish future st 'water aration iYy's for education and a MEL- ity to do on -line training. Budget Overview �` Feller stated that the budget is nto three dl components: Operations, Capital Investment, an Operati eller provided a review of the 2012 and 2013 General Fu, s and cing sources are based on projections of buildin mits through t " "` oof the ye For the past five years a 45% fund balance has bee ,ommended but with �, pro ver"nents in economic conditions, Council could ccc, wering the fund bal to 40 %, which would provide an additional $943,000 to be used purposes. Felle ted that fluctuations in growth could have an impact on the 2013 -201 ts. LaBeau j gested that the building permit estimates could be lowered to a more conse ; num Feller stated that they will provide information based on a lower building p J ate. Mielke stated that Council needs to determine where unencumbered fun - ould be allocated. Swecker stated she would be willing to consider a fund balance of 42 43 %. General Fund expenditures are anticipated to increase in each of the next two years, with the main factors being general government, public safety, public works, and parks and recreation. Feller briefly reviewed capital projects funds including the building fund, equipment fund, trail improvement fund, and pavement Management fund, which Council had discussed previously. Enterprise Funds are self - supporting from retail sales and user fees. Liquor Funds City Council Work Session July 24, 2013 Page 17 of $1.2 million per year go into the equipment fund, to reduce future tax levies, and reimburse operations and offset general fund. Utility funds will be used for major maintenance such as watermain replacement. Feller broke the property taxes into three components: tax levy, tax base, and impact on taxpayers. Levy limits are calculated by taking the highest of 2012 or 2013, which was 2012, and then add 3% plus special levies which are not subject to levy limits. From 2013 to 2014 the biggest increase is for street reconstruction. Mielke state ,. t ', en 1 - limits were initially imposed, the City did not have enough reserves =' Me debt for equipment purchases, which was not subject to levy lim . Equip w financed on a pay -as -you go basis and it is the intent to continue that. Feller stated that if Council adopts levy limits below the allowed, theeWa risk that it will become the new base. Council received materials illustra e outcome of various levy increase scenarios. Feller stated that the majo ivers for the e from 2013 to 2014 include operations (general fund and eq d), persona ;' ansitions, PERA increase for police, new positions, etc. LaBe asked, T e cn tin �gency funds. Feller x stated there are two contingency funds, one er nnel for unanticipated events such as natural disaster related expe es. ed tions i 4 s es tax and snow plowing are also reflected in the budget. Swe larified an ` `nment she is not opposed to operating costs at the Heritage only the cap, sts until previous improvements are paid for Aod e t hat due to the cant inc e in new construction and various increases in Feller of residential prd ies, it w s difficult to arrive at an average for the purpose of the tax levy. Due to pious factors including new construction the tax base has which reflects t 3 rowth in the city in 2012. Future budge sessio will be held on August 28 and on September 9 if necessary. According to St k Council must adopt a preliminary tax levy on September 16`s. The I V final levy can be eq o or less than the preliminary, but cannot exceed it. That will be the number that the co'' nty uses to set taxes. Little believes it would be helpful and more efficient to know how staff sets their priorities for needs and proposed budget items. Davis agreed that it would give council an idea of what staff believes is important. Mielke suggested looking at the whole budget rather than individual departments. LaBeau stated that it might be more acceptable to start with zero and add things rather than start at the maximum and cut items from the budget. It might also be City Council Work Session July 24, 2013 Page Is important to challenge departments to make recommendations for possible cuts. Mielke stated that department directors will be at the August budget work session to answer any questions council might have about their individual budgets. Anderson asked if there was a way to look at each department's priorities to get to a final levy amount rather than getting into the full details. Discussions could be more effective if they centered on larger budget items that are being added instead of where to cut. If there are items that Council agrees to support in order to get to the be discussed in detail again. Little agreed that understand would be a good way to proceed with budget decisions. Mielke stated that inflationary factors that will increase Swecker stated that they also need to take into consider that is eliminated from the budget. Little believes the r( raise taxes for items that are not able to be controlkA_r The Finance Department will provide 4. Mayor Little adjourned the don't need to principles are an ts` find it more palatable to than �. ago4at are.