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HomeMy WebLinkAbout2011 01-20 FCA AGENDA Brooklyn Center Financial Commission Thursday, January 20, 2011 — 6:30 PM All America Conference Room (Main Level of City Hall) I. Call to Order II. Approval of Agenda III. Approval of Minutes a. March 30, 2010 b. June 7, 2010 c. August 16, 2010 d. September 20, 2010 IV. Selection of Chair for 2011 V. 2011 Budget Status VI. Review of City Council Requests a. Budgeting and Use of State Aid Revenue b. Billing and Collection Practices for Utilities VII. Review of RFP Process and Procedures a. Insurance Agent/Risk Management Consultant b. Financial Advisor for Bond Sales VIII. Other Business IX. Adjournment Financial Commission Regular Meeting Minutes 30 March 2010 1. Call to Order The meeting was called to order at 6:30 PM Members Present: Commissioners Newman, Shogren-Smith, Berglin, Landis and Schueller and Council Member Ryan. Staff present were City Manger Boganey and Director of Fiscal & Support Services Jordet. 2. Introductions Commissioners introduced themselves to one another. 3. Election of Chair Commissioner Shogren-Smith nominated Commissioner Newman as Chair of the Commission. Commissioner Berglin seconded the motion. With all in favor the motion was adopted. Chair Newman appointed Commissioner Shogren-Smith as Vice Chair. 4. City Financial Condition Mr. Jordet briefly reviewed the End of Fiscal 2009 Unaudited Financial numbers as distributed. Included in the report were balance sheet cans cash flows information for the major funds of the City. 5. 2010 Budget Status Mr. Jordet reviewed the expected results of legislation under consideration at the State level which would reduce the amount of State Aid in the form of Local Government Aid, Market Value Homestead Credit, or both. He reviewed some of the changers being proposed by staff to deal with these changes and that the City Council would be considering a resolution in May to amend the 2010 operating budget. 6. Work Program for 2010 Mr., Jordet reviewed the agenda items referring to the work program to be pursued by the Commission in 2010. The items included review and recommendation on City Council salaries for 2011 & 2012, addressing the City Council's request for review of the collection of utilities situation and recommendations for improving the collection rates, issuance, review 1 and reward of an RFP for Insurance Agent and Risk Management Consultant, and the various meetings dealing with formulation of the 2011 budget. 7. Other Business Mr. Boganey briefly reviewed the City Council's Strategic and Ongoing Goals documents. He indicated that the Council and staff would be most appreciative of the Commission's input and feedback on these points. 8. Adjournment With no other business to transact, the meeting was adjourned at 8:25 PM. 2 A3r Financial Commission Regular Meeting Minutes 7 June 2010 1. Call to Order The meeting was called to order at 8:00 PM following a Joint Work Session with the City Council Members Present: Commissioners Newman, Shogren-Smith, Berglin, Landis and Schueller and Council Member Ryan. Staff present were City Manger Boganey and Director of Fiscal & Support Services Jordet. 2. Agenda Commissioners introduced themselves to one another. 3. Minutes Action on the Minutes of the 30 March 2010 meeting was tabled until a future meeting 4. City Financial Condition Mr. Jordet briefly reviewed the status of the 2010 budget as of 30 April 2010. 5. 2010 Budget Status Mr. Jordet reviewed the changes adopted by the City Council at their 10 May 2010 regular meeting adopting an amended budget for the 2010 fiscal year. The State of Minnesota reduction of Local Government Aid to Brooklyn Center as a budget balancing strategy left the $ 411,544 of Local Government Aid intact but reduced Market Value Homestead Credit reimbursement by $ 504,022 leaving a gap between revenues and expenditures. 6. Discussion of City Reliance on State Aid The City Council has asked that the Financial Commission review the budgeting for and use of State operational aid in light of its volatility in recent years and assist in developing a response to the situation. After some considerable discussion two points emerged as the questions that could be answered to address this situation; How much of the General Fund should be comprised of State aid dollars, either in percentage terms or dollar terms? If the City receives more than the budgeted amount of State aid, how should it be used? 7. Other Business A brief discussion of the merits of having the City contract with a single refuse hauler occurred. 8. Adjournment With no other business to transact, the meeting was adjourned at 8:43 PM. 3 Financial Commission Regular Meeting Minutes 16 August 2010 1. Call to Order The meeting was called to order at 8:22 PM following a Joint Work Session with the City Council Members Present: Commissioners Newman, Berglin, and Schueller. Staff present was Director of Fiscal & Support Services Jordet. 2. City Council Compensation for 2011-2012 Mr. Jordet reviewed the materials assembled and distributed on comparative City Council and Mayor salaries among the 10 comparison cities required by City Council policy. After discussion it was moved by Mr. Berglin and seconded by Mr. Newman that the Financial Commission recommend no increase to City Council in wages or other compensation for the 2011 and 2012 fiscal years. With all members voting in favor, the motion was adopted. 3. Adjournment With no other business to transact, the meeting was adjourned at 8:28 PM. 4 Financial Commission Regular Meeting Minutes 20 September 2010 1. Call to Order The meeting was called to order at 6:33 PM by Mr. Newman. Members Present: Commissioners Newman, Landis, Plunkett, Agbossou and Schueller and Council Member Ryan. Staff present were City Manger Boganey and Director of Fiscal & Support Services Jordet. 2. Agenda Mr. Landis moved adoption of the Agenda. Mr. Agbossou seconded the motion. With all voting in favor, the Agenda was adopted 3. Introductions and Materials Ms. Plunkett and Mr. Agbossou were introduced as the most recent Commission appointees. 4. City Financial.Condition Mr. Jordet briefly reviewed the status of the 2010 budget as of 30 August 2010. 5. 2011 Budget Status Mr. Jordet reviewed the City Council actions on preliminary budget and preliminary tax levy adoption. He also reviewed the remaining joint work session schedule and topics for completion of the 2011 budget process. 6. Discussion of City Billing and Collections Practices The City Council has asked that the Financial Commission review the collection of utility accounts in order to discover whether there is a way to reduce the number and amount of delinquent utility bills that must be assessed. Questions about the process included what the current process is (explained by Mr. Jordet, what other cities do (suggestion that staff check with the"comparison cities', what results do cities who bill on a monthly basis rather than a quarterly basis get, what is the cost to the City for collections outside the regular payment process, and what percentage of the utilities that are assessed are actually collected? Several potential actions were discussed, including monthly billing, monthly payment plans, credit card payments, ACH payments, an early pay discount, raising the penalties for late payment, raising the fees for assessment of utility bills.There were other questions about the demographics of the owners of properties that are assessed for non- payment of utility bills. Staff will pursue responses to these questions and develop a report to be delivered to the Financial Commission during the first quarter of 2011. 8. Adjournment With no other business to transact, the meeting was adjourned at 8:12 PM. 5 This page has been left blank intentionally. 6 RESOLUTION NO. 91-115 RESOLUTION NO. 92-99 RESOLUTION NO. 92-168 RESOLUTION NO. 95-78 RESOLUTION NO. 98-13 RESOLUTION NO. 99-110 RESOLUTION ESTABLISHING A BROOKLYN CENTER FINANCIAL COMMISSION AND DEFINING DUTIES AND RESPONSIBILITIES WHEREAS,the Brooklyn Center City Council established by Resolution Nos.91-115 and 92-99 an ad hoc task force for the express purpose of reviewing the fiscal impacts of State of Minnesota budgetary problems on Brooklyn Center and assisting the City Council in formulating priorities and responses to a limited fiscal resource situation; and WHEREAS,on June 22, 1992,the ad hoc City Financial Task Force presented to the City Council a report entitled "General Fund Budget Prioritization Process"which was accepted by the City Council; and WHEREAS, there is an ongoing need to formulate priorities and responses to continuing limited fiscal resources. NOW,THEREFORE,BE IT RESOLVED by the Brooklyn Center City Council that there is hereby established within the City of Brooklyn Center an advisory Financial Commission as follows: Subdivision 1. TITLE: This organization shall be known as the Brooklyn Center Financial Commission. Subdivision 2. SCOPE: The scope of activity of this Commission shall consist of advising the City Council regarding matters relevant to the City's financial status. Subdivision 3. PURPOSE: The Commission shall serve as an advisory body to assist the City Council in evaluating and developing fiscal policies, fiscal procedures, Mayor and Council Member total compensation,budgetary and capital matters, and such other issues as may be assigned to the Commission by the City Council or referred to it by the City Manager. The Commission may also identify and recommend to the City Council issues and matters for Commission and/or staff review. Subdivision 4. COMPOSITION: The Commission shall be composed of a chairperson and six (6) members, all of whom shall be appointed and serve as set forth in Subdivision 5. 7 Subdivision 5. MEMBERS METHOD OF SELECTION-TERM OF OFFICE- REMOVAL: now Chairperson: The Chairperson shall be elected by majority vote of the Financial Commission membership. The election shall be conducted at the Financial Commission's first regular meeting of the calendar year, or in the case of a vacancy, within two regularly scheduled Financial Commission meetings from the time a vacancy of the chair occurs. The Chairperson may be removed by majority vote of the Financial Commission membership. The Chairperson shall assure fulfillment of the following responsibilities in addition to those otherwise described herein: 1. Preside over meetings of the Commission; 2. Appear or appoint a representative to appear,as necessary,before the City Council to present the viewpoint of the Commission in matters relevant to the City's financial status as it relates to business under consideration by the City Council; 3. Review all official minutes of the City Council and other advisory commissions for the purpose of informing the Financial Commission of matters relevant to city finances. Vice Chairperson: A Vice Chairperson shall be appointed annually by the Chairperson from the members of the Commission. The Vice Chairperson shall perform such duties as may be assigned by the Chairperson and shall assume the responsibilities of the chair in the absence of the Chairperson. Members' Term of Office: Members of the Commission shall be appointed by the Mayor with majority consent of the Council. The terms of office shall be staggered three-year terms, except that any person appointed to fill a vacancy occurring prior to the expiration of the term for which his or her predecessor was appointed shall be appointed only for the remainder of such term. Upon expiration of his or her term of office, a member shall continue to serve until his or her successor is appointed and shall have qualified. Terms of office for members of the Commission shall expire on December 31 of respective calendar years. In the event an appointed Commissioner suffers from an extended illness, disability, or other activity preventing proper fulfillment of duties, responsibilities, rules and regulations of the Commission,the Commissioner may be temporarily replaced by an interim Commissioner appointed by the Mayor with majority consent of the City Council. 8 Oualifications for Membership: Members of the Commission shall be residents of the City of Brooklyn Center while serving on the Commission and have an interest in the financial operations of the City. Representation Requirements: Members shall be appointed upon the basis of qualification and interest and to reflect a general representation of the diversity of the community. Conflict of Interest: Commissioners shall comply with provisions of the City of Brooklyn Center's business ethics policy. Resignations-Removal from Office-Vacancies: Commissioners may resign voluntarily or may be removed from office by the Mayor with consent by majority vote of the City Council. Three consecutive unexcused absences from the duly called Commission meetings or unexcused absences from a majority of duly called Commission meetings within one calendar year shall constitute automatic resignation from office. The City Council liaison shall inform the Mayor and City Council of such automatic resignations. Vacancies in the Commission shall be filled by Mayoral appointment with majority consent of the City Council. The procedure for filling Commission vacancies is as follows: 1. Notices of vacancies shall be posted for 30 days before any official City Council action is taken; 2. Vacancies shall be announced in the City's official newspaper; 3. Notices of vacancies shall be sent to all members of standing advisory commissions; 4. Applications for Commission membership must be obtained in the City Clerk's office and must be submitted in writing to the City Clerk; 5. The City Clerk shall forward copies of the applications to the Mayor and City Council; 6. The Mayor shall identify and include the nominee's application form in the City Council agenda materials for the City Council meeting at which the nominee is presented; 7. The City Council, by majority vote, may approve an appointment at the City Council meeting at which the nominee is presented. Compensation: Commissioners shall serve without compensation. 9 Subdivision 6. RULES AND PROCEDURES: The Commission shall adopt such rules and procedures not inconsistent with these provisions as may be necessary for the proper execution and conduct of business. Subdivision 7. MEETINGS: The initial meeting of the Commission shall be convened at the call of the Chairperson within thirty(30) days after appointment by the Council. Thereafter, regular meetings shall be held with date and time to be determined by the Commission. Special meetings may be called by the Chairperson. Subdivision 8. STAFF: The City Manager shall assign one member of the administrative staff to serve as staff to the Commission. The staff member assigned shall perform such clerical and research duties on behalf of the Commission as may be assigned the City Manager. Subdivision 9. EX OFFICIO MEMBERS: The Mayor, or his or her City Council designee, shall serve as an ex officio member of the Commission,privileged to speak on any matter but without a vote, and shall provide a liaison between the Commission and the City Council. 10 2011 GENERAL FUND REVENUES: Total estimated revenue for 2011 is $ 16,402,573. This compares to $16,443,922 in the original 2010 budget and $ 16,003,578 in the amended 2010 budget. Total taxes inclusive of the proposed levy, MVHC payments and lodging tax collections of $750,000, are expected to increase from $12,750,022 to $13,610,340 or 6.75%. Licenses and Permits revenue is estimated at $606,390 compared to $710,937 in 2010. The license revenue decrease of 14.17% is based on conservative expectations of continued slow economic growth and moderate new redevelopment activities. F tergovernmental Revenue estimates decrease to $ 828,265 from $1,139,587 in the amended 010 budget. All of this decrease occurs in the estimates of Local Government Aid/MVHC. The 2011 budget follows the Council direction to reduce city reliance on unreliable sources such as State shared revenues for City going operations. As a first step toward reducing General Fund reliance was to limit budgeted State shared revenues (MVHC and LGA) to 4.5% of the general fund operations. This policy limits the combined total of LGA and MVHC to $ 738,346. This amount is significantly less than to $2,042,771 currently legislatively allotted to the City under current State Law. Given recent history of State revenue unallotment and given the current $6.2 billion State budget deficit forecast for the next biennium, it seems unlikely that- the State will meet its Statutory LGA/MVHC formula levels. By limiting General Fund reliance on State General assistance to 4.5% of General Fund Operations and establishing a $200,000 contingency the Council has mitigated the iimpact that expected State cuts might have on General Fund operations. Estimated Charges for Services increase in 2011 to $944,158 compared to $892,562 in the 2010 amended budget. This increase is largely related to increased code enforcement activities of vacant building registrations, re-occupancy inspections and vacant building registration. GENERAL FUND EXPENDITURES Strategic Focus For the last several years the City Council has remained focused on the achievement of critical strategic goals. Each year the budget has been a crafted as a policy implementation tool focused on strategic goal achievement. The 2011 budget is no different in this regard. The City Councils six strategic goals for 2011 are to: ensure a safe and secure community; aggressively proceed with city redevelopment; stabilize and improve residential neighborhoods; positively address the community demographic makeup and increasing cultural diversity; continue to maintain and upgrade City infrastructure, and environmental sustainability. 11 Line Explanation s Amount # Notes 2011 Property Tax Receipts Budgeted (including full MVHC Funding) 12,905,340 1 From Adopted 2011 Budget Propsed Reduction in MVHC (a direct reduction of net Property Tax receipts) (504,022) 2 From LMC calculations (same as in 2010) Recalculated Expectation of Property Tax Receipts 12,401,318 3 Line 1 - Line 2 2011 LGA Budgeted 200,000 4 From Adopted 2011 Budget Proposed LGA Distribution 532,075 5 From LMC calculations Increase in LGA Receipts Expected over Budgeted Amount 332,075 6 Line 5 - Line 6 Net Reduction in MVHC compared to 2011 Budget (504,022) 7 Line 2 Net Increase in LGA compared to 2011 Budget 332,075 8 Line 6 Net Change in Current 2011 Budget (171,947) 9 Line 2 + Line 6 2011 Discretionary Funds Budget (in General Fund) 250,000 10 From Adopted 2011 Budget Net Change in 2011 Budget under proposed legislation (171,947) 11 Line 9 �, Remaining Discretionary Funds available if all reduction is applied to Discretionary Fund. 78,053 12 SCHEDULE FOR PROFESSIONAL SERVICES POLICIES 2.80 Policy and Procedure on Requests for Proposals for Financial Professional Services 1. Need for Policy The City needs a policy and procedure to provide for the orderly conduct of requesting proposals for professional services for handling financial affairs, to ensure that all services will be periodically reviewed, and that the proper balance will be maintained between cost and quality of services. 2. Policy A. All professional services agreements in the area of City finance will periodically be subject to a request for proposals (RFPs) process according to an established schedule. B. Service levels will be monitored by the City Council and Staff and if unsatisfactory service is received, that contract may be re- advertised prior to the year set in the schedule. C. Quality of service will be the primary factor in awarding a contract for professional service, but cost will also be a determinant. 3. Procedure A. A schedule shall be established for the conduct of RFPs. The schedule should be adhered to unless there is a performance problem or other justification for an earlier RFP. Going to the market too frequently with RFPs expends staff time, requires extensive orientation of new professionals, and discourages quality firms from submitting proposals at their most attractive price if they expect to have the contract for only a short time. B. Specifications tailored to the professional service to be advertised will be prepared by staff, reviewed by the Financial Commission, and approved by the City Council. C. A review committee made up of the City Manager and Finance Director shall review proposals for Banking Services, Insurance Agent, Risk Management Consultant, and Custodian for Investment Securities. Proposals for Auditor and Financial Advisor shall be initially screened by staff, and then reviewed by a committee of City Council Members and Financial Commission Members appointed by the Mayor in consultation with the Chair of 13 the Financial Commission, with the approval of the City Council, which committee shall also include the City Manager and Finance Director. D. The specifications will emphasize the abilities, qualifications, and experience of the applicant firms to provide high quality service to the City. Price will be considered after one or more applicants have been identified as providing the desired quality of service. When appropriate, the specification shall require prices to be submitted in a separate, sealed envelope to be opened after applicants have been ranked according to quality. E. The City Manager shall make a recommendation to the City Council of a provider to be appointed to a multi-year engagement. It shall be written in the engagement that the appointment may be terminated earlier. Reference: City Council Resolution Nos. 2000-120; 99-20; City Council Minutes 5/28/96 Schedule'for Requests for Proposals Financial Services Type of Service,, Financial Banking Insurance Risk Custodian for Auditor Advisor for Services Agent Management Investment Bond Sales Consultant Securities Usual Interval between,i�RFP's 6 ears 6 ears 6 ears 6 ears 6 ears 6 ears M6$t Recent RFP' 2004 2002 2003 2003 1998 2002 2006 RFP 2007 RFP 2008; RFP 2009 RFP 2010 RFP 20:11 RFP 2012 RFP 2013 RFP 2014 RFP . 2015 RFP 2016 RFP 2017 RFP *Awarded to Deloite Touche who subsequently withdrew after the FY 2001 audit. Balance of engagement awarded to HLB Tautges Redpath for FY 2002 - FY 2006. 14 BROOKLYN CENTER FINANCIAL COMMISSION Chairperson and six members (revised January 2011) Susan Shogren Smith Dan Schueller 600 62nd Avenue North 5937 Emerson Avenue North Brooklyn Center, MN 55430 Brooklyn Center, MN 55430 shogrensus gmail.com dschue5 @yahoo.com (612) 812-8160 (763) 566-6417 Appointed: 1/26/2004 Appointed: 1/11/2010 Term expires: 12/31/2012 Term Expires: 12/31/2011 Rex Newman Steve Landis 3107 61st Avenue North 7118 Grimes Avenue North Brooklyn Center, MN 55429 Brooklyn Center, MN 55429 RexNewman @comcast.net landis.steve @gmail.com (763) 561-2760 (h); (763) 391-4921 (w) (763) 503-7899 Appointed: 1/8/2007 Appointed: 2/10/2010 Term expires: 12/31/2011 Term Expires: 12/31/2012 Philip Berglin Teneshia Plunkett 601 Bellvue Avenue 5906 Vincent Avenue North Brooklyn Center, MN 5430 Brooklyn Center, MN 55430 pberglin gladiusbar.com tplunkett ymail.com (763) 549-5542 (h); (763) 862-7300 (w) (763) 412-7248 (c) Appointed: 4/23/2007 Appointed: 8/23/2010 Term expires: 12/31/2013 Term Expires: 12/31/2011 Koffi Agbossou 1300 67th Avenue North Brooklyn Center, MN 55430 ezekiel5 @hotmail.fr (763) 291-8295 Appointed: 9/13/2010 Term Expires: 12/31/2013 2011 City Council Liaison: Tim Roche (v) (763) 569-3447 council memberroche @ci.brooklyn-center.mn.us City Manager: Curt Boganey (w) (763) 569-3303 cboganeyaci.brooklyn-center.mn.us Director of Fiscal & Support Services: Daniel Jordet (w) (763) 569-3345 djordet5ci.brooklyn-center.mn.us [January 20, 2011]