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Home My WebLink AboutWK August 26, 2002 ~ Q.4./ l).Yltttu1 q -11- ðó\ CITY OF ANDOVER 1685 CROSSTOWN BOULEVARD N.W. . ANDOVER, MINNESOTA 55304. (763) 755-5100 FAX (763) 755-8923. \XIWW.CI.ANDOVERMN.US SPECIAL CITY COUNCIL MEETING 2003 BUDGET WORKSHOP Conference Room A August 26, 2002 - 7:00 p.m. AGENDA 1. Call to Order 2. . Approve Agenda 3. 2003 Proposed Budget Presentation (Multi-Media) 4. Fiscal Analysis of Proposed 2003 Tax Levy 5. 2003 Proposed Budget Message Highlights 6. Council Review and Discussion 7. Other Business 8. Adjourn ... CITY of ANDOVER ANDOVER BUDGET WORKSHOP -A UGUST 16,1002 - MINUTES A Special Meeting of the Andover City Council to discuss the 2003 budget was called to order by Mayor Mike Gamache at 7:00 pm, August 26,2002 at the Andover City Hall, 1685 Crosstown Boulevard NW, Andover, Minnesota. Councilmembers Present: Don Jacobson, Mike Knight, Ken Orttel, Julie Trude Councilmembers Absent: None Also Present: John Erar, City Administrator Jim Dickinson, finance Director Lee Brezinka, Àssistant finance Director frank Stone, Public Works Director Will Neumeister, Community Development Director Dave Almgren, Building Official Dan Winkel, fire Chief Commander Dave King, Sheriff's Office Lt. Dave Jenkins, Sheriff's Office Others APPROVAL OF AGENDA Motion by Orttel, seconded by Knight to approve the agenda. Councilmember Jacobson asked if the purpose of the meeting is to set the levy. Mr. Erar explained that it is to provide the Council with everything that is in the budget, identify some of the highlights and to discuss the tax levy and tax rate. Mr. Dickinson noted that at the September 3'd Council meeting we'll be looking at setting the maximum tax levy. Motion carried unanimously. 2003 PROPOSED BUDGET PRESENTATION Mr. Erar reviewed the budget including the fiscal highlights and budget guidelines. He explained that the Management Team has the responsibility to set a balanced budget to present to the City Council. -. - , Andover Budget Workshop August 26, 2002 - Minutes Page 2 Growth Implications - Mr. Erar noted that since 1995 the city's population has increased 41 percent. 2002 Tax Rate Comparisons - It was noted that Andover's tax rate is the lowest in Anoka County. City Tax Impact - Mr. Erar reviewed the market values and tax changes on several residential and commercial properties in the city. If there was no increase in the market value, we would have seen a reduction in the city's tax. Tax Levy Composition - The capital equipment and park projects increased by 1.6%. Mr. Erar noted that in the next few years a fund for pedestrian trails for maintenance should be established. The Council wanted pedestrian trails under the control of the Council and park trails under the control of the Park Commission. Proposed 1003 vs 1001 Gross Levies - Mr. Erar explained that the 2002 certified gross levy is S5,626,477 and the 2003 proposed gross levy is $6,223.525. Revenue Highlights - Mr. Erar reviewed the revenues noting that property taxes will increase by 7.35%; there is a decrease in licenses and permits because of new reporting requirements; miscellaneous revenue is down because of the economy. He eXplained that we are not getting the amount of interest that was projected. Revenue by Category - Mr. Erar reviewed the percentage of the budget for each category. Fiscal Trends - It was noted that tax capacity values are down from 2001 and tax capacity rates are up in 2003 from 2001 and 2002. Proposed 2003 General Fund Expenditures - Mr. Erar noted that Andover has the lowest percentage of personal services of any city. 2003 Special Levies - Special levies will include the Road and Bridge Levy which includes sealcoating, crack sealing, street overlays and pedestrian trails, Park Project Levy, Capital Equipment, Fire Levy, Lower Rum River Watershed Levy and Debt Service. Council Budget Workshop August 26, 2002 - Minutes Page 3 FISCAL ANALYSIS OF PROPOSED 1003 TAX LEVY Mr. Dickinson noted that the total tax market value is 51,719,548,600. The assessor will be asked to give a final presentation to Council. The Minnesota Department of Revenue has limited the 2003 levy limitation to $5,256,S31. Proposed Property Tax Levy Analysis - Mr. Dickinson explained that $190,310 is the payment from the General Fund to the EDA for the payment on the Public Works building. Staff is hoping to levy to the maximum. Mr. Dickinson reviewed the property tax levy, budget gap analysis and the General Fund 2003 Fund Balance Analysis noting that it is projected to be 34.95%. Councilmember Trude asked if there is money to cover the new program for employees who are retiring. Mr. Dickinson noted that the money is available. Regarding the Revenue and Expenditure Summary, Mr. Dickinson noted that revenues will not be as high as anticipated. The Expenditure Budget Summary was reviewed with Mr. Dickinson explaining that we are looking at an increase of 4.93%. Councilmember Jacobson asked why the Planning and Zoning budget is increasing so much. Mr. Neumeister stated that it is the Zoning Ordinance update. Mr. Erar also noted that part of it is for a summary of the Comprehensive Plan. 2003 PROPOSED BUDGET MESSAGE HIGHLIGHTS Mr. Erar reviewed his proposed budget message noting that the key policy factors that guided staff in preparing the budget including a commitment to restrain any increase in the local tax capacity rate to a percentage level no greater than the annual increase in the CPl for the previous calendar year, a fiscal goal toward establishing the General Fund balance at no less than 30% of the 2003 General Fund expenditures, a commitment to maintain the 2003 debt Jevy at no more than 25% of the total levy, a comprehensive review of the condition of capital equipment to ensure the most cost effective replacement schedule, a team approach that encourages strategic planning, and a management philosophy that supports the implementation of Council policies and goals. Mr. Erar reviewed the significant events of the current year. Councilmember Jacobson recommended taking the 54,000 out of the contingency and putting it in the Fun Fest fund. He also noted that under Mayor/Council is $13,SOO for the North Metro Mayors' Association and we haven't decided if we want to join that organization. He also questioned the electrical costs that increased by $40,000 and the large increase in the Human Resources budget. - --- Andover Budget Workshop August 26, 2002 - Minutes Page 4 Regarding Organization Management, Mr. Erar explained that one new employee in the Parks Department is proposed along with a Community Services Director which is in the budget in the event a community center is built. The Engineering Department has a position for a Natural Resources Technician. The 2002 budget contained an Engineering Technician but that position was not filled. That position has been restructured to the Natural Resources Technician. Councilmember Trude asked what level of position the Community Services Director will be. Mr. Erar explained that it is a department head. Councilmembers Knight and Jacobson both felt the position is not needed until 2004. Councilmember Jacobson questioned whether the proposed cafeteria plan for health insurance has been worked out. Mr. Erar noted that the cost for a full cafeteria plan would be much more than what the budget could take. Staff plans to do a modified cafeteria plan. Councilmember Knight suggested having a meeting to discuss the Cost of Living increase and health insurance. Mr. Erar explained the fire department longevity recognition program and non- discretionary personnel expenses. Regarding city growth, it was noted that penn it issuance for single family dwelling is slowing down. By 2003 we should have a population of 30,000. Mr. Erar then reviewed the notable capital outlay. Councilmember Trude asked if the purchase of more property from Ken Sylzuk is in the CIP. Mr. Erar stated that it is and noted that Mr. Slyzuk is receptive to selling. Mr. Dickinson reviewed a memo from Jim Miller of the League of Minnesota Cities regarding levy limits. Motion by Knight, seconded by Jacobson to adjourn. Councilmember Trude asked if Laura Landes could attend the September workshop. Mr. Erar noted that he will contact Ms. Landes. Motion carried unanimously. Meeting adjourned at 9:45 pm. Respectfully submitted, û" tJ...IL Vicki Volk City Clerk