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Home My WebLink About2011 09-06 CCM Joint Work Session with Financial Commission MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA JOINT WORK SESSION WITH FINANCIAL COMMISSION SEPTEMBER 6, 2011 CITY HALL - COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Joint Work Session with the Financial Commission and the session was called to order by Mayor Tim Willson at 6:33 p.m. ROLL CALL Mayor Tim Willson and Councilmembers Carol Kleven, Kay Lasman, and Dan Ryan. Also present: City Manager Curt Boganey, Fiscal and Support Services Director Dan Jordet, BCS Director /Assistant City Manager Vickie Schleuning (arrived at 6:35 p.m.), and Deputy City Clerk Maria Rosenbaum. Others present were Financial Commissioners Dan Schueller (arrived at 6:37 p.m.). Mayor Willson informed that he had received an e -mail from Financial Commissioner Steve Landis and read the e-mail that stated the following: "My principal feedback is a cautionary suggestion that the public should be educated in general as to what we as the Council and Advisory Committee have decided in order to balance the budget. The future is what concerns me - we shaved where we could but in the future may not be able to shave as much which could result in additional increases in fees and/or taxes." GOVERNMENTAL FUNDS AND TAX LEVY — REVENUES TO EXPENDITURE GAP City Manager Curt Boganey informed since the last meeting on August 29, 2011, staff had been working on using a combination of Local Government Aid (LGA), increasing revenues, and looking at expenditure reductions with minimal impact on services. The outcomes of these discussions were presented by Fiscal and Support Services Director Dan Jordet as follows: • LGA of $200,000 has been included in revenue with an accompanying $200,000 in contingency expense. • Abatement charge revenue has increased $5,000. • The Cafeteria Plan contribution for employee health and insurance benefits has been changed to reflect a reduced medical insurance premium from Blue Cross /Blue Shield for 2012. The incentive contribution for participation in a high deductible plan has been increased. • Dollars for an unfilled Housing Inspector position have been removed from Code Enforcement. 09/06/11 4- • The civil defense siren in Emergency Management will be replaced in 2011. • Property and casualty insurance premiums have been adjusted downward as well and reduction of the administrative fees charged by the agent of record. • The administrative transfer from other funds has been increased by $14,302. • Upon receipt of information from the Volunteer Fire Relief Association the contribution to the pension funding for the Relief Association has been reduced by $27,000. • General fees will be increased to produce a net increase of 2 percent in fee revenue; $31,500. • Various other line item adjustments have been made in each department following a request to Directors for suggestions on reducing their budget areas by 1 percent for 2012. Fiscal and Support Services Director Jordet informed with that being said, the property tax levy includes the 2.21 percent scenario which would raise an additional $302,614. With the Cafeteria Plan possibly being changed employees could see an amount of $750 for the City's contribution and an incentive of $130 to employees if they choose the high deductible plan. This would be a saving of approximately $104,000. With all of the suggestions and the notice from the Volunteer Fire Relief Association that the contribution to the pension funding for the Relief can be reduced to $12,700, the savings of $27,000 will be included in the General Property Tax Levy leaving a $18,500 surplus. City Manager Boganey wished to emphasize on the following: • The surplus of revenues over expenditures will need to be discussed more in the future and it is apparent all departments reducing services now, at this one percent, after years of asking to reduce, departments are starting to see the impact on the department's ability to operate effectively. • The lower premiums this year for health care allowing the extra $104,000 in the anticipated budget helped a lot this year and being able to reduce the City's contribution because of the lower premiums, no employee will actually see a reduction in their ability to pay for their health care insurance. Also because of the new premiums, even at the $750 Cafeteria Plan contrition some employees will see their overall family coverage go down. • With the unfilled position of a Housing Inspector from the Code Enforcement Budget, it is anticipated that the same level of service will continue; however, there will be no improvements. With this proposed balanced budget and if the Council adopts the Preliminary Levy on September 12, 2011, staff will be in a position to further refine the budget in the next several months. Discussion continued regarding the advantages that helped complete the 2012 Budget and how moving forward is going to continue to bring new challenges. It was noted that the communication to citizens will be crucial in letting them know that the City is trying its best to accomplish a lot with very little help. 09/06/11 -2- Fiscal and Support Services Director Jordet outlined the proposed 2012 Property Tax Levy. He informed that if the Council approves the Levy proposed the expected impact on median value residences, because of the manner in which homestead credit is going to be received, is very different for 2012 and beyond because rather than getting a credit on the taxes there is a reduction in the taxable value. In 2012 the median value stays as the taxable value for non- homestead properties and the taxable value for homestead properties decease using a formula similar to what was used to calculate the actual tax credit. Discussion continued on the proposed Levy and it was noted that there would be some comparisons available to help better educate on the impact for commercial /industrial (higher end, 90 -95 percentile) because of the shift of proportion of market value homestead credits. City Manager Boganey recapped the challenge was to bring back a balanced budget and staff worked at making that happen by using LGA funds, a substantial reduction in the City's health insurance, and more moderate adjustments. This all meaning that the homestead median value homes will probably see no increase in their property tax, homestead properties below median will see some decrease, and the properties above the median seeing some increase in their City bill. The non- homestead properties along with commercial /industrial properties will see a substantial higher increase due to shift in the State program. Discussion continued with respect to future budgets and how hard things are going to get since there is no more places to cut and this needs to be communicated. ADJOURNMENT Councilmember Lasman moved and Councilmember Ryan seconded to adjourn the Work Session at 7:31 p.m. Motion passed unanimously. 09/06/11 -3- STATE OF MINNESOTA) COUNTY OF HENNEPIN) ss. Certification of Minutes CITY OF BROOKLYN CENTER) The undersigned, being the duly qualified and appointed City Clerk of the City of Brooklyn Center, Minnesota, certifies: 1. That attached hereto is a full, true, and complete transcript of the minutes of the of the City Council of the City of Brooklyn Center Joint Work Session with Financial Commission held on September 6, 2011. 2. That said meeting was held pursuant to due call and notice thereof and was duly held at Brooklyn Center City Hall. 3. That the City Council adopted said minutes at its September 26, 2011, Regular Session. M City Clerk Mayor 09/06/11 -4-