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HomeMy WebLinkAboutSP August 12, 1997 .. I CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW. . ANDOVER, MINNESOTA 55304 . (612) 755-5100 SPECIAL CITY COUNCIL MEETING - TUESDAY, AUGUST 12, 1997 Call to Order - 7:00 p.m. 1. 1998 Budget Workshop Adjournment - .- -- - _.._.~- aff¡ /ûf éWf!' /~ /997 CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW. . ANDOVER. MINNESOTA 55304· (612) 755-5100 SPECIAL CITY COUNCIL MEETING - AUGUST 12, 1997 MINUTES A Special Meeting of the Andover City Council was called to order by Mayor Jack McKelvey on August 12, 1997, 7:10 p.m., at the Andover City Hall, 1685 Crosstown Boulevard NW, Andover, Minnesota, to discuss the proposed 1998 General Fund Budget. Councilmembers present: Dehn, Knight, Orttel Councilmember absent: Kunza Also present: Fire Chief, Dan Winkel Building Official, Dave Almgren Public Works Superintendent, Frank Stone City Engineer, Scott Erickson City Finance Director, Jean McGann Community Development Director, Dave Carlberg City Administrator, Richard Fursman Others Proposed 1998 General Fund Budget Assumptions: Mr. Fursman stated the General Fund Budget for 1998 that was presented to the Council does balance. Because of changes in the State law, the county has not yet been able to provide the City with the tax capacity for 1998. So the budget anticipates 75 percent of this year's growth for next year. The budget also assumes a 2-percent increase, plus a 2- percent increase for the payment for the Public Works Building and a 1- percent increase for the street overlay projects. That brings the tax rate to 20.16 percent. Two new Public Works employees are included in the budget plus an engineering technician, as well as a 2.9-percent cost of living adjustment. A S-percent increase in the budget impacts a $125,000 house by $15 to $17 per year in taxes. Mr. Fursman explained all capital expenditures have been taken out of the budget, and Staff is looking at other revenue sources to fund those capi tal expenditures. Ms. McGann then reviewed those other revenue sources, including $50,000 in administrative fees from Presbyterian Homes, which is a one-time fee for administering the revenue bond; $50,000 in the Capital Equipment Reserve; $250,000 in the in-house revolving MSA fund for street maintenance; $31,000 transferred from the sewer and water fund for equipment, plus any adjustment in the tax capacity. In total, there could be about $381,000 which could be used for capital. Of that, $250,000 would be for street maintenance programs. The 1-percent levy approved by the Council for street overlays amounts to $49,700, which is included in the General Fund Budget. Mr. Fursman pointed out no PIR funds are available this year for capital equipment because those funds were used primarily for the new buildings and overlays. That fund will accumulate more funds in the coming years. Another hope is the commercial district will produce some funding that can be put toward capital expenditures. - - - -. ~, , \, Special Andover City Council Meeting Minutes - August 12, 1997 Page 2 (Proposed 1998 General Fund Budget Assumptions, Continued) Ms. McGann also explained the State legislature enacted levy limitations for cities. Even with the S-percent proposed increase, the City is still at almost $57,000 less than its maximum levy limit. The State set Andover's levy limit at $2,753,649. The proposed 1998 budget before the Council is $2,696,860. Mr. Fursman also explained the change in tax rates approved by the State and how it will affect Andover residents. About 90 percent of the City's taxes come from residential property, which is a high percentage. The average in the metropolitan area is 60 to 70 percent from residential property; the rest come from commercial and multi-family units. Wage Proposal: Ms. McGann and Mr. Fursman then explained the wage proposal that is included in the proposed 1998 General Fund Budget. Ms. McGann reported effective January, there is a 1-percent increase in the required contribution per employee in PERA. The City's contribution toward health insurance has not changed since 1994. The suggestion is to increase the City's contribution $25 per month per employee. With that increase, the City's average contribution for health insurance is between 69 and 70 percent. Councilmember Orttel stated the increases in PERA for all departments appears to be quite high, sometimes as much as 30 to 50 percent. Ms. McGann stated she will verify the PERA figures in the proposed budget. Mr. Fursman reviewed the City of Andover Flow Chart on personnel. The proposed engineering tech position would be self-sustaining, that is the fees generated by the engineering tech would be paid through development fees. In addition, two Public Works employees are reflected in the budget. A step program was adopted two years ago to provide entry level and maximum wages for each position at Andover and to provide a yearly stepping program. That applies to all employees, even the union members. The scale for each position shows the ranges of salaries in the metro area and the group area, which consists of cities of about the same population as Andover's. The scale also shows how Andover's present step program compares with those ranges. When that step program was implemented, the intent was to make Andover's maximum pay that of the average pay of that position. He is proposing, and the budget reflects this proposal, that the City's range be increased to correspond to the average range of the metro or group scales. The Council and Staff discussed the effects of the proposal on individual positions. Mr. Fursman stated the proposal has been discussed with all employees and union representatives. The union is still looking at it, but the initial reaction was positive. Ms. McGann stated the net effect of that proposal, including the increased contribution for health benefits, is to increase the budget by about $30,000. The Council expressed concern that the proposal tends to reward the new hires and penalizes those who have been with the City for some time. There does not appear to be a problem with applicants for -- --..---.-. .-....~. ': Special Andover City Council Meeting Minutes - August 12, 1997 Page 3 (Wage Proposal, Continued) open positions, so it was felt that some financial incentive or bonus should be in place for longevity, special training and education, and creativity in the way a task is done. It was also noted that any incentive program must be closely coordinated with good defined expectations and a very good evaluation program. Before giving final approval to the wage proposal, the Council wanted more time to analyze it with an eye toward providing incentives for the employee of two to three years to retain them and to those who have been with the City for many years. Fire Department Presentation: During the remainder of the meeting, representatives from each of the Departments gave a presentation on the goals and objectives and capital outlay requests. Fire Chief Winkel reviewed the Fire Department's goals and objectives for 1997 and 1998 and the proposed capital outlay for 1998, which also includes those items needed daily to operate the Department. He reported the Department has responded to about 10 percent more calls each year for the last three years. They are proposing to replace the pumper at Station 3, which is their primary pumper, because it is obsolete. Also, the county is proposing a program to pay for 75 percent of the cost of updating the mobile and hand-held radios for all fire departments in the county. That update will impact the budget by about $14,000. Chief Winkel then reviewed those capital outlay items that have been requested, including the operating supplies. If the new truck is moved to be paid with PIR funds and the proposal from the county is approved, their capital outlay comes to about $390,000. Ms. McGann stated $10,000 is still in the operating budget for supplies. Chief Winkel stated a part-time Fire Marshal position was originally included in the 1998 budget, but it has been removed. He reviewed th~ duties that would be performed, including about 1852 hours of inspections per year, much of which are not getting done now. Statistics show that in 1996, Anoka County had the fourth highest dollar loss in Minnesota from fire. It also ranked second in Minnesota for total property loss due to arson and fourth highest in the number of arson calls per county in Minnesota. He reviewed the number of calls and fire calls the Department responded to in 1996 and to date this year. Chief Winkel showed the results of a survey done by the City of Anoka Fire Department in February, 1997, of hourly pay for the fire fighters. Twenty five cities responded, and the average hourly pay was $8.42. Andover's current hourly pay is $7.25 for the fire fighters. For the 1997 budget, a proposal was made to increase that pay to $7.50; however, that was not approved. For 1998, the proposal is to increase the pay to $8 per hour. The City's contribution to the relief association is $750 per firefighter annually. The request is to increase that by $65 this -- _.....--"-...,- ."-, , [ Special Andover City Council Meeting Minutes - August 12, 1997 Page 4 (Fire Department Presentation, Continued) year. Councilmember Orttel suggested that because of the increased insurance contribution to the relief association due to the City's growth, the City's contribution should be reviewed to be sure it is not over funded compared to other cities. Chief Winkel stated the fund is fully funded because it is a piece-of-the-pie program, and it is up to the City to decide how much it wants to contribute. Planning Department Presentation: Mr. Carlberg provided the Department's goals and objectives. They are not requesting capital outlay for 1998. The biggest change relates to the personnel step program. They are asking for $3,000 more in publishing costs because of the reviews of the Comprehensive Plan and the Zoning Ordinance. Protective Inspection Department Presentation: Mr. Almgren stated their capital outlay requests were removed from the budget and asked that they be put back in. The requests include a software package for building permits, a CD rom archiving program, a printer for the Building permit office, and $5,000 to be put toward the purchase of a new vehicle in the future. Mr. Fursman explained established cities that have stopped growing can start developing a vehicle pool. Because of Andover's growth, it is difficult to keep up with the need for additional vehicles much less replace existing ones. Once the capital equipment bond is paid, that is when the City can look at purchasing new vehicles again. Mr. Almgren reported his Department has taken in about $325,000 in revenue so far this year, with expenses of about $266,000. In 1996 they took in $583,000, and about $275,000 of that went into the General Fund. They have issued permits for 180 homes this year, and he is anticipated another 100 plus commercial. Civil Defense Presentation: Mr. Almgren stated the request for 1998 is to have a siren motor on hand because of the time it takes to get sirens back on line that must be repaired. This would be a one-time expenditure. Each year one or two sirens get hi t by lightening, and it can take months to get them operating again. Having one on hand would mean the siren could be operational very quickly. Of the $5,000 requested, about $2,500 is for installation. Ms. McGann stated the installation costs are already included in the proposed budget. Finance Department Presentation: Ms. McGann briefly reviewed the list of goals and objectives for the Department to accomplish during 1998. -_.--- ---- - -. --.- -, (I Special Andover City Council Meeting Minutes - August 12, 1997 Page 5 Engineering Department Presentation: Mr. Erickson stated the estimated engineerir,g budget for next year is about the same as 1997. They did request a vehicle, which was cut from the budget; but he would like to keep it in. They are trying to implement a payback program for the Engineering Department to charge vehicle mileage to all projects just as consulting engineers do. They have requested a new Engineering Tech 4 position which would be funded by revenues generated from the position. Councilmember Orttel thought the budget reflects potential revenues to be the same as the previous year with no corresponding increase. He also recalled a glaring error in the PERA for the Department. Mr. Erickson thought there should be an increase in revenues. Public Works Department Presentation: Mr. Stone stated all of the cracksealing, sealcoating and overlays have been removed from the budget, except for $49,700 for overlays. After the progress just beginning on street maintenance, it is a big drop in the program. He asked for $350,000 for 1998 for cracksealing and sealcoating. Last year $200,000 came out of the PIR fund for overlaying. Ms. McGann stated they have identified $250,000 in the in- house MSA fund to be used for street maintenance. That fund does get replenished very slowly. With that transfer, about $500,000 would still remain in the fund. Mr. Fursman also noted that the excess reserves generated mainly by the Building Department last year were put toward street maintenance. This year those excess funds will be going toward the cleanup costs of the storm. He estimated those cleanup costs to be $200,000 to $300,000. Legislative funding is being sought, but it is not known if the City will receive any. Mr. Stone also reviewed the request of $10,000 to paint the old Public Works Building and the pole barn after the new building is completed. Between streets and highways and snow and ice, they are requesting two trucks and a front end loader. Mr. Stone noted the capital outlay being requested for recycling is for more recycling bins. Ms. DeRuyter's hours have increased by 10 hours, to a total of 30 hours per week. A request that is not shown is for printing the City of Andover calendar. If the Council wishes to do that again, the cost is about $9,000 for black and white or about $12,000 for color. The Lions Club and athletic associations are going to be approached for contributions. The Council wanted to see the entir,= calendar paid for by either donations or advertisements. Possibly the haulers or recycling manufacturers would be interested. They suggested further research be done for financing the calendar. Parks Department Presentation: Mr. Stone noted the department is requesting the old Toro be traded for a new one with a broom to be used on the hockey rinks. There is also a request for $200,000 for park improvements. - --~--- - --..__.-..--.-..~, - -- , I Special Andover City Council Meeting Minutes - August 12, 1997 Page 6 {Parks Department Presentation, Continued} Dave O'Toole, Park and Recreation Commission Chairperson, explained the Park Board has been updating the older parks and replacing unsafe equipment. They would like to update four or five more next year. Kelsey-Round Lake Park is about half done. The DNR did not approve a grant for that park this year, but they had budgeted $100,000 toward it. The City will apply for a grant next year again. Todd Haas, Assistant City Engineer, explained a number of the trails in Kelsey-Round Lake Park are class 5, plus there is no connection between the north and south portions of the park because of the wetland. That project is a high priority because it is a regional park. The Park Board also asked for another $100,000 to update equipment to meet the EDA requirements plus other park improvements. Last year about $60,000 was allocated for park improvements. This year the budget shows zero dollars for that item. The Park Dedication funds are used for new parks and now for the trails. Chairperson O'Toole stated the Coon Creek Trail is being paid for from park dedication. They had originally planned that a portion of it would be paid with TIF funds, but those funds are not available. It would be helpful if the City could help fund some other project in the next year or two to offset that amount. He requested that some capital outlay be allocated to update some of the older parks. Next? Mr. Fursman stated Staff has estimated additional revenue of $381,ÚOO so far, plus they should have the county's figure for the City's tax capacity tomorrow. Once those figures are known, the Staff will come back with more information on capital expenditures and a prioritized list of requests. The biggest item in the budget is for personnel. For now, the Council must just set the levy amount, either the maximum levy amount of $2,753,649 or the budget amount before the Council now of $2,696,860. That amount must be sent to the county by September 15. Between then and the middle of November, the Council can then schedule budget meetings to finalize the line items. The Council agreed. MOTION by Dehn, Seconded by Orttel, to adjourn. The motion carried on a 4-Yes, 1-Absent (Kunza) vote. The meeting adjourned at 10:44 p.m. Respectfully submitted, ~ ~"~F~:t ~~ella A. Peach Recording Secretary ~--~ -- - -----_.-