HomeMy WebLinkAbout1995 05-04 FCAAGENDA
BROOKLYN CENTER FINANCIAL COMMISSION
May 4, 1995
City Hall
Council Chambers
1. Call to Order: 7:00 P.M.
2. Roll call.
3. Approval of Minutes: April 12, 1995
4. General Fund Budget Prioritization Process.
5. Delivery of Adopted 1995 Budget.
6. Legislative Update.
7. 1996 Budget Calendar.
8. Set Date of Next Meeting.
• 9. Adjournment: 9:00 P.M.
0
0 MEMORANDUM
TO: Donn Escher, Ned Storla, Ron Christensen, Lee
Anderson, Lawrence Peterson, Jay Hruska, Phillip
Roche, Kathleen Carmody
FROM: Charlie Hansen, Finance Director
DATE: April 28, 1995
SUBJECT : Pending Agenda Items.
At the April 12, 1995 Financial Commission meeting, the Commission asked to
be notified of any City Council Work Sessions at which the budget would be
discussed. On May 2, 1995, there will be a worksession at which some discussion
of budget issues. Any interested Commissioners are invited to attend.
Also at the April 12, 1995 Financial Commission meeting, the Commission passed
a recommendation for changing the Adequate Fund Balance Formula. I intend to
report that recommendation to the City Council at the May 22, 1995 meeting. It
will be valuable to have at least one Financial Commission member attend the
meeting. If no one is able to, please advise me so that I may reschedule the
report. U U~
There are two items which have been identified as agenda items to be taken up in
the near future. First is to rewrite the City's Investment Policy. A bill is
progressing through the State Legislature which will change the state law
governing city investments. I have put this policy rewrite on hold until the new
law is enacted so that our policy can be written to conform to it. Second is to
rewrite the City's Purchasing Policy. This requires a commitment of time by both
Nancy Gohman, Assistant City Manager, and myself. Nancy has been extremely
busy with personnel issues and I have been occupied with the 1995 budget. Work
on this policy rewrite has been delayed accordingly. We hope to turn our attention
back to this in the next couple of months.
•
• MINUTES OF THE PROCEEDINGS OF THE FINANCIAL COMMISSION
OF THE CITY OF BROOKLYN CENTER
APRIL 12, 1995
CITY HALL, COUNCIL CHAMBERS
CALL TO ORDER
Chair Donn Escher called the meeting to order at 7:00 P.M. in the City Hall Council Chambers.
ROLL CALL
Present at roll call were Chair Donn Escher, Commissioners: Ron Christensen, Ned Storla,
Larry Peterson, Jay Hruska, and Phillip Roche. Also present were Council Liaison Kathleen
Carmody, City Manager Gerald Splinter, and Finance Director Charlie Hansen. Also present
was Nancy Carlson.
ADDroval of Minutes
A motion was made by Commissioner Larry Peterson to approve the minutes of the March 2,
1995 meeting. Commissier Ron Christensen seconded the motion and all members voted in
its favor. . fl 4- P `
New Members
Donn Escher introduced Jay Hruska and Phillip Roche who are newly appointed members of the
Financial Commission.
• Adeauate Fund Balance Formula
Charlie Hansen presented the history of the Adequate Fund Balance Formula and outlined
several options for modifying the formula to meet changing conditions. After discussion,
Commissioner Ned Storla moved that the formula identified in the agenda packet as "Revision
#2" be recommended to the City Council for inclusion in the City's Financial Management
Policies in place of the original formula. Commissioner Jay Hruska seconded the motion and
all voted in favor of its adoption.
Actions of the State Legislature on Budget Issues
Jerry Splinter gave a summary of actions at the State Legislature. The Governor, Senate, and
House of Representatives each have their own agendas. There is little chance of predicting the
outcome before the Legislature adjourns.
General Fund Budget Prioritization Process
Donn Escher gave a brief history of the earlier effort at budget prioritization in 1991 and 1992
and asked that staff report on those recommendations which have been implemented. Jerry
Splinter suggested that if the process is reopened, that it should be part of the 1996 budget and
start with employee input again. This should also be the start of Phase 3 of the Organization
Evaluation Process.
0
Discussion of 1996 Budget Calendar
Donn Escher drew the Commission's attention to a draft of the 1996 Budget Calendar. Jerry
Splinter asked what additional information and involvement the Financial Commission would like
to have in the budget process. The consensus was that the Financial Commission would like to
be notified if the City Council decided to hold additional work sessions on the budget. Staff was
asked to include the most current budget calendar with each Financial Commission mailing.
Communitv Improvement Task Force
Jerry Splinter announced the creation by the City Council of a Community Improvement Task
Force to evaluate the prospects for a bonds issue for public building and park improvements and
that each advisory commission was asked to contribute a member. Phil Roach volunteered.
Next Meetine
The next meeting will be Thursday, May 4, 1995 at 7:00 P.M.
ADJOURNMENT
At 9:00 P.M. there was a motion by Commissioner Ned Storla and seconded by Commissioner
Jay Hruska to adjourn the meeting. The motion passed unanimously.
•
0
adfdb194 CITY OF BROOKLYN CENTER
ADEQUATE GENERAL FUND BALANCE POLICY FORMULA
AS ESTABLISHED BY THE CITY COUNCIL ON DECEMBER 22, 1980
(AS SET FORTH IN M&C NO. 80-31 AND AMENDED FEBRUARY 26. 1990)
Revision #2 for Removal of Uncollected Taxes from Category 92 and
Changing to the Revenues Reserve to 5% of all Revenues
1. Latest Audited Total Fund Balance
At December 31, 1994 $5,214,413
•
•
2. Less Items Not Readily Convertible to Cash:
a. Accounts Receivable 42,151
b. Advances to Other Funds 105,074
$147,225
3. Fund Balance Convertible to Cash $5,067,188
4. Less Amount Appropriated to the General Fund Current
Year Budget: 1995 $0
5. Amount Available Before Deduction for Working Capital $5,067,188
6. Less Amounts to be Reserved for Working Capital:
(40% of Total General Fund Current Year Budget)
40% of. ' $11,457,923 = $4,583,169
7. Amount Available After Deduction for Working Capital $484,019
8. Less Amounts to be Reserved for Other Purposes:
a. Reserve for Overestimation of Revenues:
(5% of General Fund Revenues in Current Year Budget)
5% of: $11,457,923 = 572,896
9. Amount Available per Formula for Other Use ($88,877)
Revision2 4/28/95
•
t,~MENTS AND EXPENDITURE REDUCTIONS.
SUMMARY OF REVENUE ENHANAN ~ TOTAL.
pS RECOMMENDED BY THE FINANCIAL TASK FORCE FOR THE. PRIORITIZATION PROLES!
PRIORITY 1. PRIORITY 2. PRIORITY 3. PRIORITY a
$0 $42,910
$2,910 $16,150
$23,850 1,130,x55
4,000 1,°14,200
EXPENDITURE REDUCTIONS WITH MINIMAL SERVICE IMPACT
103,355 8,500
CATEGORY A: ° 0 2,000
CATEGORY B: REVENUE ENHANCEMENTS 2,000 0 ° 0 0
ORY C: CHARGE TO OTHER DEPARTMENTSlAGENC{ES FOR SERVICE
0 a 45,204
CATEG 0 1,200
CATEGORY D: REASSIGN DUTIES TO OTHER EMPLOYEE 41 DEPARTMENT 33,750 62,882
17,652 2,750
CATEGORY E. REDUCTIONS WITH SOME IMPACT ON 8,,004 730 3,00Q 0 9,700 PUBLIC 1,200 °
CATEGORY F. REDUCTIONS WITH SOME IMPACT ON THE OPERATING 8,500 366,393
40,000 132,633
ITEMS REQUIRING CAPITAL OUTLAY TO REDUCE 127,660 66,100 3,382
CATEGORY G: 0 3,382
STAFFING ISSUESIALTERNATIVE SERVICE ISSUES 0 0
CATEGORY H: 27,485 60,485
CATEGORY 1: PERSONNEL MANAGEMENT ISSUES 33,000 $1,72
CATEGORY $1,212,650
$99,362 _
CATEGORY J: OTHER ISSUES $348,099 TOTAL:
act on quality of service.
PRIORITY 1: First items to be cut. Guts would have little or no imp
mot. Cuts would have some effect on level of service. Less`nWe weve ould upbethese reluctant items.
to implement these changes.
act on level of service.
PRIORITY 2 Second items to be
last to be considered.
PRIORITY 3: tower priority itms to be cut. Cut would have substantial imp
have severe impact on level of service. We would hold on to these items as the very
PRIORITY 4: Very last items to be cut. Cuts would
0 9 9
(EEEPPR1)
REVENUE ENHANCEMENTS AND EXPENDITURE REDUCTIONS AS RECOMMENDED BY THE FINANCIAL TASK FORCE FOR THE PRIORITIZATION PROCESS
Print Set: 123
PRIORITY 1
PRIORITY 2 PRIORITY 3 PRIORITY 4
TOTAL
CATEGORY A: EXP
ENDITURE REDUCTIONS WITH MINIMAL SERVICE IMPACTS
CITY COUNCIL*
Lump sum reduction of annual planning process expens
CM
2,500
~rao,cat~~K~, E EDC
2,500 ✓
CITY MANAGER
Use alternative employment advertising methods
500
500
EMERGENCY PREP
Reduce books and pamphlets
400
400 V'
FIRE
Discontinue CPR Training
3,120
3,120P""
POLICE
Reassess towing agreement charges
5,000
5,000 0
DATA PROCESSING
Negotiate quantity discounts through LOGIS
2,000
2,000 V
PLANNING & INSP
Send compliance orders through regular mail
500
500 ✓
GOVT BUILDINGS
Electric savings/power capacitors
1,300
1,300 ✓
ENGINEERING
Reduce special paper and maps
250
250 V
ENGINEERING
Send weed notice through regular mail
350
350
STREET MAINT
Dirt and seed instead of sod
500
500
VEHICLE MAINT
Buy non-brand name tools
100
100✓
VEHICLE MAINT
Use ABC extinguishers
500
500
VEHICLE MAINT
Don't buy additional rust protection on autos
1,350
1,350 ✓
CITYWIDE
Use zip code printing software
100
100
PARKS MAINT
Amend Diseased Tree program
4,000
4,0006"
CITY MANAGER*
Reduce amount allocated for labor relations service
2,000
CM
2,000L~
CITY COUNCIL
Drop League of Minnesota Cities membership
13,650
13,650
EMERGENCY PREP*
Reduce printed forms
200
20O W
EMERGENCY PREP*
Reduce Safety supplies
400
4006"'
EMERGENCY PREP*
Reduce dues and subscriptions
210
2106*'
FIRE*
Delay furniture replacement
2,000
2,000 ✓
ENGINEERING*
Reduce supplies
150
150V
ENGINEERING*
Minimize photo copying
30
30
EMERGENCY PREP
Reduce training and conferences
500
500 ✓
POLICE*
Eliminate uniforms for the dispatchers
1,300
CM
-
-
-
-
1,300 ✓
TOTAL CATEGORY A
23,850
-
-
-
-
2,910 16,150 0
42,910
Page 1
,~,c-c'"i'1"Lift
~.Ri'ti"rL✓~~tf.~)
0 0 0
PRIORITY 1
PRIORITY 2 PRIORITY 3 PRIORITY 4
TOTAL
CATEGORY B: REVENUE ENHANCEMENTS
-
CITY MANAGER*
Increase/add fees for maps, copies, etc.
CM
1,200
n~y.
Gt M+
/
1,200 y
CITY MANAGER
Increase license fees for food establishments, etc.
7,000
1
~f
Heaktt,
7,000 ✓
ASSESSING
Discontinue no cost processing of change orders after
Board of Equalization meeting
3,240
3,240 v"
POLICE
Increase dog license fees
1,000
1,000
FINANCE
Charge full 2* admin and 8k eng fees on all impr projec
15,000
15,000
PLANNING & INSP
Establish housing and maintenance reinspection fee
1,500
1,500 v✓
PLANNING & INSP
Increase Planning Commission fees
3,100
3,.100✓
ENGINEERING
Charge non-refundable plan deposit
3,750
3,750V
ENGINEERING
Double fees for copies
175
175 V
ENGINEERING
Permit charge for private utilities
500
500 V
ENGINEERING
Implement final plat fee
800
800 ✓
ENGINEERING
Implement easement vacation fee
250
250✓
ENGINEERING
Charge tree registration fee
250
250 ✓
STREET MAINT
Charge $1 for Christmas tree dropoff
740
(*L~ 4AUV'44b
740
COMMUNITY CNTR
Raise water slide fee by twenty-five cents
18,750
18,750 ✓
RECREATION
Raise all class fees by ten percent
17,000
17,000{/
RECREATION
Raise non-resident softball player fees $2
3,000
3,000 L "
POLICE*
Increase false alarm charges
20,500
CM CR", K
~20,500✓
FINANCE*
Charge franchise fee for City's public utilities
CM-NR ((JJ
0
PLANNING & INSP*
Increase rental license fee
CM 16,000
16,000 ✓
PLANNING & INSP*
Charge 65W plan check fee for residential permits
8,500
8,500 V
STREET LIGHTING*
Implement street light utility
CM 144,000
144,000
STREETS MAINT*
Special Assess sealcoating
260,000
260,000
DATA PROCESSING
Include data processing costs in fee structure
4,000
4,000{/
FINANCE*
Charge franchise fee for electric, gas, cable
CM 577,000
577,000
PARKS MAINT*
Charge rental for picnic tables
1,800
CM
1,800
PUB UTILITIES*
Discontinue senior citizen discount for sewer
16,000
16,000
RECREATION*
Add $1 non-resident fee to all classes
5,000
CM
5,000
TOTAL CATEGORY B
103,355
8,500 4,000 1,014,200 1,
130,055
Page 2
PRIORITY 1 PRIORITY 2 PRIORITY 3 PRIORITY 4 TOTAL
CATEGORY C: CHARGE TO OTHER DEPARTMENTS/AGENCIES FOR SERVICES
PARKS MAINT
Charge full cost for bandwagon
500
PARKS MAINT
Charge Golf Course for utilities
1,500
-
TOTAL CATEGORY C
-
2,000
CATEGORY D:
REASSIGN DUTIES TO OTHER DEPARTMENTS
-
CATEGORY E:
REDUCTIONS WITH SOME IMPACT ON EMPLOYEES
CITY MANAGER
Reduce purchase of books and pamphlets
250
UNALLOCATED
Limit out-of-state conferences to department heads only
4,000
ASSESSING
Reorganize staffing
12,158
POLICE
Eliminate pickup and drop-off of resident officers
1,000
DATA PROCESSI
NG Have employee take home data back-up instead of contrac
300
PARKS MAINT
Discontinue utilities to some shelters
3,000
CITY COUNCIL*
Five percent voluntary reduction in City Council salari
19,946
CITY COUNCIL
Reduction of training and conferences
CITY MANAGER*
Reduce dues and subscriptions
350
UNALLOCATED*
Cancel attendance at Municipals banquets
UNALLOCATED
Limit out-of-state schools to only a select few employees
-
TOTAL CATEGORY E
41,004
0 0 0
CM
1,000
1,200
2,000
3,000 0 1,200
500 ✓
1,500 ✓
2,000
0
250 ✓
4,000
12 , 158 1✓
1,000 ✓
300&-"
3,000 ✓
19,946
1,000
350 1/
1,200
2,000
45,204
Page 3
i
*'Alro~
- -
CATEGORY F: REDUCTIONS WITH SOME IMPACT ON THE PUBLIC
UNALLOCATED
Find a replacement for newsletter publisher
POLICE
Do not accept NSF checks if amount is under $200
GOVT BUILDINGS
Reduce fertilizing service from 5 to 2
PARKS MAINT
Reduce fertilizer service contract
STREETS MAINT
Reduce preform pavement markings
SOCIAL SERVICES*
Withdraw from Five Cities Senior Transportation Program
PARKS MAINT
Reduce trail repair to minimum
UNALLOCATED*
Eliminate Earle Brown Days security costs
RECREATION*
Eliminate childrens, Halloween party
PARKS MAINT*
Reduce parks reforestation
PARKS MAINT*
Eliminate goose control
PARKS MAINT*
Reduce plaza plantings
PARKS MAINT
Eliminate maintenance on tennis courts
TOTAL CATEGORY F
CATEGORY G: ITEMS REQUIRING CAPITAL OUTLAY TO REDUCE OPERATING COSTS
VEHICLE MAINT
Establish new vehicle maintenance computer program
VEHICLE MAINT
Purchase wire feed welder
PARKS MAINT
Accelerate replacement of mowers
-
TOTAL CATEGORY G
CATEGORY H: STAFFING ISSUEVALTERNATIVE SERVICE ISSUES
-
COMM DEVELOPMENT Reorganize staff
PRIORITY 1
PRIORITY 2
PRIORITY 3 PRIORITY 4
TOTAL
4,000
4,000
2,800
2,800V
930✓
1
1,930
,
425
4
4,425
,
750 ✓
2
2,750
,
10,727
CM
10,727
9,000
9,000K
11,500
11,500
750
750
2,500
2,500(/
2,100
2,100
2,400
2,400
8,000
8,000
8,730
17,652
2,750 33,750
62,882
0
0 ✓
8,000
0
8,
500
500✓
200✓
1,200
1,
8,500
1,200
0 0
9,700
Page 4
PRIORITY 1 PRIORITY 2 PRIORITY 3 PRIORITY 4 TOTAL
55,592 55,59211"
0 0 0
HEALTH Turn all health inspections/licensing over to County
ENGINEERING Eliminate seasonal survey technician
RECREATION Cut one program supervisor position
PARKS MAINT* Reduce parks overtime by 50%
ENGINEERING Eliminate two engineering technician positions
COMM DEVELOPMENT* Reduce Planning & Inspect secretary position to part-ti
ANIMAL CONTROL Eliminate all part-time Code Enforcement positions
POLICE Eliminate all part-time Code Enforcement positions
STREETS MAINT* Reduce street overtime by 50%
VEHICLE MAINT* Reduce shop overtime by 50t
STREETS MAINT Reduce part-time personnel by 50k
POLICE* Reduce scheduled overtime
STREETS MAINT* Eliminate one Maintenance II position
PARKS MAINT* Eliminate one Maintenance II position
PARKS MAINT Reduce part-time personnel by 50$
TOTAL CATEGORY H
58,930
5,100
30,000
10,000
CM
40,000
13,138
CM
10,000
1,000
10,000
127,660 ---66,100-
---40,000-
58, 930 ✓
5,100 Y
30, 000 t/.
10,000
40,000
13,138
14,310
14,310
9,573
9,573
CM
10,000 h-;' Y
CM
1,000
14,750
14,750
10, 000
35,000
35,000
35,000
35,000
24,000
24,000
--132,633-
--366,393- i
CATEGORY I: PERSONNEL MANAGEMENT ISSUES
CITY MANAGER* Receptionist position to be job shared
TOTAL CATEGORY I
CATEGORY J: OTHER ISSUES
POLICE Eliminate Canine Program
POLICE* Restrict parking 2-6 a.m. 12 months a year
POLICE Encourage traffic and truck enforcement program
0 0 0
Page 5
3,382 3,382
3,382 3,382
PRIORITY 1 PRIORITY 2 PRIORITY 3 PRIORITY 4 TOTAL
5,000 5,000
NR-CM o v
3,000 3,000
'11,,
0 25,000
9,485
9,485 18,000
25,000 18,000 0
detention devices dispatchers NR-CM
Expand use of home call back duties CO 60
POLICE TAP/Senior Citizen cycle ,985
Transfer sealcoat 0 27,985
to street debt 0
POLICE Add one year course
forgive golf 33,000 -
STREETS MAINT Have city -
-
1,723,011
RECREATION* 212,650
62,900
TOTAL CATEGORY J -
99,362
348,099
CATEGORIES on quality of service,
TOTAL ALL - these items.
ive up
- - Cuts would have little or no impact Less willing to g
to implement the
- - - items to be cut. level of service. service. We would be reluctant
PRIORITY 1: First some effect on
to be cut. Cuts would have act on level of
PRIORITY 2: Second items
Priority items to be cut. Cut would have substantial imP
hold on to these items as the very las
PRIORITY 3: Lower Pri
d have severe impact on level of service. We would
changes.
PRIORI'T'Y 9: Very last items to be cut. Cuts would
to be considered.
a er,s recommendation changed by Financial Task Force.
City Man 9
C _ City Manager's recommendation.
NR = Not recommended by Financial Task Force
Page 6
V + ,Vrn
10 MEMORANDUM
TO: Gerald G. Splinter, City Manager
FROM: Charlie Hansen, Finance Director
DATE: April 20, 1995
SUBJECT: Adopted 1995 Budget
The Adopted 1995 Budget is ready for distribution to the City Council, Staff, and other
interested parties. I know that the delay in its delivery has been a matter of concern. No one
has been more concerned than I. There are several factors which have affected budget
preparation that I feel are worthy of discussion.
The two major changes which occurred in this budget were your decision to convert to an
activity budget and my decision to expand the budget to include all city funds. These decisions
had implications that went far beyond what either of us imagined.
In the Adopted 1994 Budget, the basic budgetary unit was the department. For the Adopted
1995 Budget, we broke departments down into activities. This increased the number of
budgetary units from 33 in 1994 to 134 in 1995, a four fold increase.
Budgeting for wage and benefit costs is one of the most critical factors to control. The individual
cost of salaries, wages, and benefits must be calculated for each employee and then correctly
inserted into the budget. If too little is budgeted, the city will run a deficit. If too much is
budgeted, then either our citizens were taxed too much or they were denied services which they
paid for.
Until 1994, our standard procedure for budgeting for personal services costs was to identify a
home department for each employee, then charge all of their wage and benefit costs to that
department no matter what work they did. Even if they did work that benefited another
department, the costs were still charged to their home department. The only exceptions to this
were three employees who's costs were divided amongst three departments each, and five
employees who's costs were divided amongst two departments each.
In the Adopted 1994 Budget, 23 budgetary units had personnel costs charged to them. For the
Adopted 1995 Budget this increased to 102, a four fold increase.
0
To do true activity budgeting, we decided that employee's time should be charged to the activity
the work benefited, regardless of whether that activity was in the employee's home department
or another department. For each employee, we must now determine the total personnel cost,
spread that across the appropriate activities, total up each activity for all employees charged to
it, total the activities into departments and funds and finally verify that these totals match the
original individual costs of all employees. It is common for an employee to be allocated to
between six and twelve activities. It isn't unusual for an employee to be allocated to up to two
dozen activities. So not only did the number of budgetary units see a four fold increase, but the
process became far more complex and difficult than the departmental line item budget done in
past years. I can't objectively quantify the factor by which the complexity of this operation
increased, but I feel it is a multiple of what previously existed.
The Recreation Department presented another challenge. They have always operated a type of
program budget. There were too many programs to simply declare them each to be an activity,
so we had to group similar programs into activities. However, for their internal management,
they still needed the programs. So recreation costs still have to be developed on the program
level, then consolidated into activities, then consolidated into departments. You asked that the
Recreation Administration department disappear and its costs be allocated out to the programs.
We made progress, reducing the Administration budget from $346,805 in 1994 to $91,711 in
1995. It wasn't possible to make it disappear in 1995. Tim Johnson and I have identified an
accounting process we can use to fully allocated out administration in the 1996 budget without
creating other significant problems.
So having created this size and complexity, are we now doomed to always suffering late delivery
of future budgets? No. A great deal of my time last year and this winter was spent formatting
the new budget pages and creating the accounting processes which allow me to prepare the
budget in this more complex system. This work won't have to be recreated unless the budget
process or format changes. In past years, Paul or I were able to produce an adopted budget by
about the end of January. This one is arriving in late April. I expect future budget deliveries
to be somewhere in between. Possibly late February. This year's delivery was also delayed by
the requirement for me to cover for the absence of an M.I.S. Coordinator for about a month.
I don't want to sound like I am complaining about this. Two years ago I readily agreed when
we planned to switch to the activity budget. I initiated the extension of the budget to all funds.
I feel both of those decisions were correct. I just want you to understand the difficulties of this
process were far greater than any of us anticipated. Between accounting for the Heritage
Center, the Central Garage, and now the activity budget, my staff and I are stretched to the limit
and our ability to undertake other new initiatives is going to be severely limited.
9
League of Minnesota Cities
•
Cities Bulletin
Number 15
April 14,1995
Senate approves Omnibus Tax Bill
Gary Carlson
38 to 29 vote. Five DFL Senators
voted to remove the freeze, including
Senators Steve Kelly, Gene Merriam,
Charlie Berg, Allan Spear, and John
Marty.
The Senate took up the measure on
Wednesday, less than 24 hours after the
Senate Tax Committee completed work
on the bill. The committee version of
the bill contained few revolutionary
features other than the property tax
freeze. A proposal to increase the
cigarette tax by 40 cents a pack and
offset the revenue increase with a
reduction in the medical provider tax
used to finance the MnCARE program
was ultimately pulled from the bill.
That provision would have raised
approximately 5123 million in state tax
revenue for the current biennium.
The other highlight of the commit-
tee hearing focused on the S91 million
state forecast error that will make more
money available for the state-general
fund. (See story page 7.)
The Senate met the constitutional
requirement that all tax and spending
bills must orieinate in the House of
Represenmaves by amending the
Senate property tax provisions onto a
technical corrections tax bill previously
passed by the House.
The House of Representatives is
moving more methodically in the
drafting of their tax bill. According to
sources, the House will complete their
tax bill on or around April 21. This
schedule could allow conference
committee negotiations on the two tax
bills sometime during the last week of
April. Although the House doesn't
have the freeze language in bill form
yet, it still could be chilly for cities in
1996. Q
After nearly six hours of debate
and dozens of proposed amendments,
the full Senate approved the Omnibus
Tax bill on Wednesday, April 12. The
bill includes a property tax freeze and
tax relief for cabin properties. The
Senate attached the tax bill to H.F. 602,
a technical corrections bill that had
been on the Senate consent calendar,
and sent it back to the House of
Representatives for consideration.
Although the Senate discussed
many amendments, only a few were
actually added to the bill. The most
notable amendments adopted include a
limitation on the increase of parcel
market values to the rate of inflation,
an amendment to dedicate the S91
million interest earnings to the school
levv recovnition shift. and a provision
to provide property tax relief for cabin
properties, and an amendment that
would allow growing communities to
venerate additional levy based on new
construction. Tre bill ultimately
passed on a to i7 vote.
Senator Bill Belanger (IR-
Bloortington) offered an amendment to
repeal the property tax freeze. His
amendment received considerable
debate but w•as ultimately defeated on a
Page 3-freeze talk
! Page 5-Action Alert
Cities are: alone in criticizing Legislators will have to worm
the Senate procerty tax freeze fast to address workers' comp. .
proposal.
•
League of Minnesota Cities
Cities Bulletin
Number 16
April 21,1995
House tax bill restores some aid cuts
Doesn't include property tax freeze
Gary Carlson
The House Tax Committee took up
their 1995 omnibus tax bill with a
mixture of good and bad for cities. The
bill restores $57 million in LOA and
HACA cuts originally proposed by the
Governor. and does not include a
property tax freeze. The bad news is
that the bill would not restore the S20
. million payable 1996 aid reductions,
and contains numerous TIF restrictions.
The Committee met on Friday,
April 21, after this edition of Cities
Bulletin went to press. We received a
copy of the bill late Thursday and
completed a cursory overview. Next
week's Cities Bulletin will include a
detailed review of the bill, including
any amendments or floor action.
The House bill will restore the $57
million in proposed 1995 LOA and
HACA cuts that were included in the
Governor's budget recommendations.
However, the bill will not restore the
payable 1996 aid reductions of S20
million proposed by the Governor and
will take the entire S20 million from
HACA. The bill chanties the distribu-
tion of those cuts to include counties
and special taxing districts.
Page 3--Nominations open
Nominations are now open for
AMC board and officer spots.
As expected, the House bill is
tough on TIF. The bill contains
provisions included in H.F. 147,
Representative Dennis Ozment's (IR-
Rosemount) TIF restriction bill. It
includes the expanded "but-for" test,
the developer repayment provisions,
and a narrower definition of soil
condition districts. The bill would
expand TIF reporting and disclosure
requirements, and would allow a
project to be exempt from the LGA/
HACA penalty if a city elects to make
a qualifying local contribution. The
bill would also require early
decertification of districts by limiting
the use of revenues to costs defined in
a qualifying plan by December 31,
1995. The bill also restricts revenues
to covering repayment of debt issued
before July 1, 1995, and certain outer
limited uses. The bill would require
the Met Council to study the use of TIF
in the seven county metropolitan area.
The tax bill does not contain any city
specific TIF provisions.
The bill eliminates the tax-exempt
status of interest on certain governmen-
tal bonds. However, this provision
appears to be less onerous than the
original language of H.F. 1380. As a
rule of thumb, the bill does not remove
Page 4-A chilling effect
The Senate property tax freeze
would affect city residents in
many ways.
the exemption for property tax sup-
ported bonds.
The constitutional amendment to
take education finance off the property
tax (see page 7) is'not part of the tax
bill. Other items that are part of the bill
include a senior citizen property tax
deferral, a circuit-breaker credit for
cabin owners, a increase in the ciga-
rette tax, and the creation of a local
government efficiency and effective-
ness review panel.99
CITY OF BROOKLYN CENTER
1996 BUDGET CALENDAR
May 2, 1995 Tuesday Preliminary 1996 Operating Budget conference for City
Manager with city department and division heads.
May 4, 1995 Thursday Financial Commission discusses 1996 Budget
May 12, 1995 Friday Data processing capital outlay requests due. Vehicle capital
outlay requests due.
May 22, 1995 Monday City Council discusses elements of Capital Improvements
Program (C.I.P.). City Manager presents 1996 Operating
Budget issues.
June 8, 1995 Thursday 1996 Operating Budget requests due from all departments for
submission to the Finance Director.
June 19, 1995 Monday Consolidated 1996 Operating Budget requests forwarded from
the Finance Director to the City Manager.
June 19 through June 30
Manager consults as necessary with department and division
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heads as 1996 Operating Budget document is shaped.
June/July 1995
City Commissions make preliminary recommendations on
Capital Improvements Program (C.I.P.) components.
August 'l, 1995
Department of Revenue is to certify Local Government Aid
amounts.
August 10, 1995 Thursday
Preliminary 1996 Operating Budget is delivered to the City
Council members.
August 21, 1995 Monday
Joint City Council/Finance Commission meeting.
August 21, 1995
County must notify City of the public hearing dates selected
by school districts.
August 31, 1995
Department of Revenue is to certify Homestead and
Agricultural Credit Aid (HACA).
Sept 6, 1995 Wednesday
City Council holds work session to review Proposed 1995
Operating Budget.
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Sept 11, 1995 Monday Last day for adoption of the Preliminary 1996 Operating
Budget and the Preliminary tax levy by the City Council.
City must select initial truth in taxation hearing date and
a date for a continuation hearing.
Sept 15, 1995 Certify preliminary 1996 Operating Budget and preliminary
tax levy to the County. City must also inform the County of
City budget public hearing dates.
Sept 18, 1995 Monday Utility Rate Study and Utility Funds budgets presented.
Sept 25, 1995 Monday City Council adopts the Utility Rate Study.
Sept 29, 1995 Friday Proposed 1996 Operating Budget is delivered to the City
Council members.
Oct 16, 1995 Monday City Council holds work session to review Capital
Improvements Program (C.I.P.) and Enterprise Funds
budgets.
Oct 23, 1995 Monday City Council approves C.I.P. and Enterprise budgets.
Nov 1995 County must mail Truth In Taxation notices to each property
owner.
Nov 20, 1995 Monday City Council holds work session to review Proposed 1996
Operating Budget.
Nov 1995 Wednesday Notice of public hearing placed with Post Publishing
December 1995 City Council holds original public hearing on the 1996
Operating Budget.
December 12, 1995 Tuesday All counties to hold budget public hearings.
December 1995 City Council holds reconvened public hearing on the 1996
Operating Budget.
December 1995 City Council adopts the final 1996 tax levy and final 1996
Operating Budget at a subsequent public hearing held
during the regular City Council meeting.
December 27, 1995 Weds Last day to certify final tax levy and final 1996 Operating
Budget to the County.
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