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HomeMy WebLinkAboutSP June 21, 1989 .~. CITY of ANDOVER Special Council Meeting - June 21, 1989 7:30 P.M. Call to Order 1. status of Computer and Accounting System 2. 1990 Budget and Status of Truth in Taxation Laws 3. Assessment policy Discussion 4. Bonding Procedure and Use of a Financial Consultant 5. Laptuta Property and New City Hall Building 6. Financial Institution Discussion 7. Administrative Trust Fund Purpose and Use 8 . Authorized Banking Personnel Adjourn ~, . {~ CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW. . ANDOVER. MINNESOTA 55304 . (612) 755-5100 SPECIAL CITY COUNCIL MEETING - JUNE 21, 1989 MINUTES A Special Meeting of the Andover City Council was called to order by Mayor Jim Elling on June 21, 1989; 7:30 p.m., at the Andover City Hal I, 1685 Crosstown Boulevard NW, Andover, Minnesota. Councllmembers present: Jacobson, Knight, Orttel Councilmembers absent: Perry Also present: City Attorney, William A. Hawkins; Finance Director, Howard Koolick; City Administ~ator/ Englnee., James Sch.antz; and othe.s STATUS OF COMPUTER AND ACCOUNTING SYSTEM Mr. Koollck gave a brief background on the computer system, noting the hardware Is of very high quality, but there is no one to support the software. The utility billing Is running; however, there Is no one to train them on the accounting package. He asked the Council what direction to take at this time, noting several options which he had outlined in the Agenda material. Mr. Koollck noted the difficulties of getting support for the software packages, feeling that needs to be a very Important part of any decision. He also reviewed the offer by AmerlData to provide equIpment in exchange for outstanding credit due the City and the proceeds of the equipment the City owns. Mr. Koollck felt it Is a poor proposa I . If the Council decides to bid a completely new system, he would recommend Jim Stern of Chapel Consulting be hired for that process. Mayor Elling stated the intent had been to salvage whatever we can of the existing system for as long as possible and possibly to supplement the accounting with some IBM system and accounting package. Attorney Hawkins noted the Certificates of Indebtedness issued for the computer have not yet been paid off. Mr. Koolick stated there is no fund accounting program for the DEC equipment the City owns. The one package that is available is lacking In support as the nearest respresentative Is in Eau Claire, WIsconsin. He stated he knows of no other citIes using the DEC accounting program. Shorevlew has a DEC system but is in the process of getting a different system. Counci I discussed the options of contacting a company that would transfer an acceptable IBM or APple accounting program to the City's system or looking at what the League of Minnesota Cities uses since they have the same hardware. They did not feel a maintenance agreement on any hardware was necessary, as repairs can be paId for as needed. They also did not want to spend a lot of money at this time on separate equipment and software for accounting, as eventually the desire would be to have everything In one system. , - ... -. Special City Council Meeting Minutes - June 21, 1989 Page 2 (Status of Computer and Accounting System, Continued) At this poInt the Council was reluctant to hi~e a consultant to write an RFP, asking Mr. Koolick to check with other cities and with IBM as to what would be the best way of getting a functional accounting system. Hopefully such a system would be compatible with a system that would eventually replace the DEC equipment. It was again noted that at thIs point the Council did not want to spend a lot of money. MOTION by Orttel, Seconded by Jacobson, that the Council direct the Financial Director to research the issue of an accounting software package and haLdwaLe thLough all avaIlable SOULces beIng vendors, surrounding cities, and the League of Minnesota Cities, and to come back with a report more clearly defining what Is available, what the cost would be and potential sources of funding and its adaptability. Motion carried unanimously. 1990 BUDGET AND STATUS OF TRUTH IN TAXATION LAWS Mr. Koolick noted the League has advised the CIty to comply with the 1988 law even though It Is unworkable and the levy limits will not be known until a day after the levy must be certified. He reviewed the proposed calenda~ for the 1990 budget. Council asked that the following Items be looked at for the 1990 bUdget: exercising the option on the Laptuda property, funds for an administrator, funding fo~ the remainder of the street lIghting program, funds for the playground equipment at Crooked Lake School, plus fundIng for traffic signals and possibly the Northern Mayors' Association. Mr. Koolich also recommended a contingency fund be established for such unknown Items as Increased litigation costs, general ~equests brought In by the residents throughout the year, etc. No Council action was required at this time. ASSESSMENT POLICY DISCUSSION Mr. Koollck advised the Council that Its development contract differs from most othe~ cities in that the assessment rolls are kept in-house and interest is paid only to the date of payment. He wanted the Council to be aware that by doing so, the City is not receiving as much Interest on its assessments as it would ~eceive If the County collected the assessments. Mr. Schrantz also noted that other cities charge a higher percentage for admlnlstLatlve and assessing costs. He had asked for an Increase in that percentage several years ago, but the Council opted to keep it the same. Special CIty Council Meeting Minutes - June 21, 1989 Page 3 (Assessment Policy Discussion, Continued) Council reviewed the reasons the decIsIon was made to keep the assess- ment rolls In-house, noting it was to make It easier for developers and residents, and so they wouldn't have to pay all that extra interest. Attorney Hawkins noted at the same time the City reduced the deposit in the Development Agreement to 15 percent, so it became important for the City to keep control of what was coming in for assessments. If the assessments are not paid, the Development Agree- ment allows the City to accelerate the assessments and have the full balance paid off Immediately. So the trade-off of receiving less interest was to stimulate busIness. Mr. Koolick stated the City has not been current In sending out the assessment billing. He did not know the costs of keeping the rolls in-house. CouncIl asked that a study be done this year to determine the CIty's admInistrative and assessment costs plus overhead. No action was taken. BONDING PROCEDURE AND USE OF A FINANCIAL CONSULTANT Mr. Koolick revIewed hIs memorandum regarding the current process used In bonding and the use of a financIal consultant. By funding improvements Internally untIl the bonds are sold, there Is less cash to Invest and Interest earned on the bond proceeds is lost during construction. An alternative would be to require all construction needs to be requested during the winter and bonded for durIng the spring before any constructIon is begun. Then the proceeds from the bond would also be used to payoff construction as it Is done. CouncIl generally felt the concept Is a good one but that In practicality it doesn't work. They wanted to remain more responsive to the residents, not wanting to have to tell them when they come in with a request that they would have to wait up to a year before any project could be done. It was also noted that construction Interest is assessed from the time the payments are made, so that interest is not lost. However, the CouncIl asked that that be carefully monitored, as no fund should be subsidIzing improvement proJects. Mr. KoolIck felt the City's needs mIght be better served by hiring a financial consultant, asking whether the City Attorney's office has the resources to meet the City's needs. Attorney HawkIns reviewed the background of why hIs office became Involved with the City's financial concerns, noting he does work closelY with the bond counsel and has called In another organIzation when necessary. Since he has been involved, the CIty's ratIng has gone up, thinking he does have the reSOUrces avaIlable. He stated he would lIke to contInue doIng It. The CouncIl generally was satisfied with the service of Mr. Hawkins, recommendIng Mr. Koollck contact Mr, Hawkins to become more famIliar with what Is avaIlable. No action was taken. Special City Council Meeting Minutes - June 21. 1989 Page 4 LAPTUDA PROPERTY AND NEW CITY HALL BUILDING After discussion, the Counc II agreed to exercise the City's option on the Laptuda property and that the funds be put into the 1990 budget. There was no interest In discussing a new city hall, thInkIng when the need arises, It would be put on a referendum. FINANCIAL INSTITUTION DISCUSSION Mr. Koolick asked I f the Counc il Is Interested In changing its dally savings and checkIng accounts to the FlrStar Bank in Andover. They have not done so because of the many fees Involved with the local bank. Counci I generally preferred banking locally If the fees are waived; however, they fel t It is in the best interest of the residents to bank at the least expensive place. Mr. KoolIck was advised the decision should be made on the best financial arrangement. ADMINISTRATIVE TRUST FUND PURPOSES AND USE Mr. KoolIck reviewed the AdminIstrative Trust Fund whIch collects the one percent administrative fee added to all assessments. He noted the problems of not relatIng the transfer amount to the assessments outstanding and of never identifying what costs are being Incurred in relation to the assessment. He felt the options would be to transfer all the monies to the general fund and deposit any future administrative fees to the general fund or to have the City Staff analyze the fund to determine the proper amount of remaining administrative transfers to be made. MOTION by Orttel, Seconded by Jacobson, move Option 2, to have the City Staff analyze the Administrative Fund and related accounts and determine the proper amount of administrative transfers to be made. DISCUSSION: Mr. Koolick stated there Is almost $416,000 In the Administrative Trust Fund at this time. Counc II recalled there was discussion of using those funds for water treatment. CouncIlmember Orttel CHANGED THE MOTION to state to see how much is usable at thIs tIme. Second Stands. Motion carried unanimously. Special City Council Meeting Minutes - June 21, 1989 Page 5 AUTHORIZE BANKING PERSONNEL Council agreed to keep those authorized to sign checks as Is -- the Mayor and Acting Mayor, the Treasurer and Deputy Treasurer -- and the Financial Director's functIon will be to approve bills and to make sure they are within budget. MOTION by Orttel to adjourn. Motion carried unanimously. Meeting adjourned at 9:34 p.m. Respecuu,1 I~ubmltted, l \1~~pe~ Recording Secretary