HomeMy WebLinkAbout2017 09-18 CCM Joint Session with Financial CommissionMINUTES 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 18, 2017
CITY HALL - COUNCIL CHAMBERS
M1IXOJi 113W
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 6:30 p.m.
Mayor Tim Willson and Councilmembers Marquita Butler, April Graves, Kris Lawrence-
Anderson, and Dan Ryan. Also present were City Manager Curt Boganey, Deputy City Manager
Reggie Edwards, Finance Director Nate Reinhardt, and Carla Wirth, TimeSaver Off Site
Secretarial, Inc.
Others present were Financial Commission Chair Rex Newman, Commissioners Anna Burke,
Jeffrey Dobbs, Tia Hedenland, and Dean Van Der Werf. Financial Commissioners Teneshia
Kragness and Abate Terefe were absent.
II.(I1'LI S] N3III7
Councilmember Ryan moved and Councilmember Butler seconded to approve the agenda.
Motion passed unanimously.
III.2018 CITY MANAGER RECOMMENDED LEVY
City Manager Curt Boganey said that staff had prepared the budget under the guidelines set forth
by the City Council. After Council review, modifications were made and the proposed budget is
within the maximum parameters provided at the beginning of the process.
Finance Director Nate Reinhardt provided a PowerPoint presentation outlining revenue
adjustments in the Building Permit Revenues, Lodging Tax Revenue, Police Training-State
Funds, Rental Licenses, Property Re-inspection Fees, and Police Liaison Reimbursement of
$173,000.
Commissioner Burke asked if the Lodging Tax Revenue can be counted on through confirmed
reservations. Mr. Reinhardt explained it is based in part on recent revenue trends, plus the
Marriott will be opening and that should generate additional room night reservations.
Mayor Willson stated through the Visitor's Bureau, he knows the Super Bowl has resulted in a
lot of additional bookings. Chair Newman agreed and noted that it is a seller's market as there
was speculation the Twin Cities would not have enough hotel rooms for that event. Mr. Boganey
agreed and stated all of the nearby hotels will be fully booked before, during, and possibly after
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the Super Bowl. However, that is not the principal reason for the adjustment to that budget line
item. The principal reason is because of increased hotel room reservations coming in.
Councilmember Graves asked about the adjustment to Building Permit Revenues. Mr. Boganey
stated staff is seeing an upward trend in the actual amount of construction and anticipated
projects. In addition, staff reviewed historical data and a combination of those factors indicated
it would be reasonable and conservative to make the proposed adjustment.
Mr. Reinhardt presented expenditure adjustments made to the Contingency, Administrative
Services Reimbursement, Vacancy Savings, Building Maintenance/Capital, Fire Department
Ford Explorer (moved to Central Garage), Fire Department Workers Compensation, Fire
Department Records Management Software Upgrade, and Convention/Tourism totaling
($249,919). He then reviewed the 2018 Property Tax Levy total of $17,105,950, or an increase
of 5.63%. The 2018 HRA levy is $345,978, or an increase of 5.14%. It was noted that a 1%
increase in the budget totals approximately $162,000. He then presented a budget overview of
the 2018 General Fund revenues totaling $21,346,036 and displayed a pie chart depicting
General Fund revenues by source, which is consistent with 2017 percentages. Mr. Reinhardt
described the significant changes in General Fund revenues, both increases and reductions.
Councilmember Graves asked about the $25,000 reduction in rental licenses, noting she receives
comments there are too many rentals and single-family rentals. Mr. Boganey stated staff will do
further analysis to better answer the question, noting it is historically due to the number of large
apartments due for renewal. Mayor Willson stated it may also show there are fewer Type IV,
meaning the rental program is working well.
Commissioner Burke asked whether the $30,000 reduction in Special Assessments relates to
nuisance abatements being addressed more quickly. City Manager Boganey stated that is likely
to be a significant part of it as staff is seeing more voluntary compliance on nuisance violations
due to proactive action by staff.
Mr. Reinhardt presented General Fund expenses by function, noting the 2018 budget is a
balanced budget. He displayed a pie chart depicting General Fund expenses by function. Mayor
Willson asked about the Central Supplies reduction of $134,660. Mr. Reinhardt reviewed the
number of items that have been moved to other funds.
Mr. Reinhardt reviewed General Fund expenses by object, salary assumptions, personnel costs,
number of full-time employees since 2010, and significant changes. Information was also
provided relating to General Fund capital outlay of $83,500 and Transfers Out of $15,000. Mr.
Reinhardt then presented the 2018 HRA Levy of $345,978, an increase of $16,899 over 2017.
He noted the taxable market value of Brooklyn Center increased by 11.8% over 2017, a
significant increase for the fourth consecutive year, Mr. Reinhardt then reviewed the tax
capacity estimate by classification. He stated the County has indicated a median valued home in
Brooklyn Center is $167,000, which is the highest value since 2009.
Mayor Willson commented on the change in median value and tax rates. Mr. Reinhardt
explained that based on the 5.63% levy increase there will be a 2.7% decrease in the City's tax
rates from 70.498 in 2017 to 67.816 in 2018. At the request of Mayor Willson, Mr. Boganey
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stated staff will check on the median value home in 2008.
Councilmember Graves asked whether there was a way to prevent, through checks and balances,
fraudulent foreclosures (subprime lending). Mayor Willson stated the City does not regulate
those areas so it would have to make a good educated guess. Mr. Boganey stated staff will
research to see if anything is on the horizon but he thinks probably not because increases seen
now are lagging increases that occurred in other communities two to three years ago. He
explained that the affordable housing in Brooklyn Center became more attractive as the cost of
housing in other communities increased. But now the City is seeing the benefit of people
looking for affordable homes, which pushes values up at a faster rate than higher-valued homes
in other communities.
Councilmember Ryan noted the housing and financial market collapse was the result of unique
circumstances as the mortgage industry sold off mortgages and there was irresponsible lending
but those practices were addressed by legislation. Mr. Boganey agreed, noting most would say
that qualifying for a mortgage is much more difficult now than several years ago.
Mr. Reinhardt reviewed projected property tax impacts based on classification of property. In
2018, single-family residential will increase by 10.40%, multi-family residential by 6.41%,
commercial property by 3.08%, and industrial property by 2.90%. He stated the City Council
will be asked to adopt the preliminary budget and levy at their September 25, 2017, meeting.
Chair Newman asked if it has been the practice to approve the maximum HRA levy. Mr.
Boganey stated that has been the practice over the last ten years out of necessity to generate
enough to cover the EDA operating expenses, which are funded through the HRA. He explained
there is some overlap and the EDA can do everything the HRA can do with more flexibility on
commercial and industrial activities.
Mr. Boganey stated if there are no further questions, staff recommends the City Council adopt
the maximum levy of 5.14%, which is below the initial preliminary estimates and the general
direction of 7% or less. He stated even though some enhancements were made based on the City
Council's initiatives, the increase is relatively modest, noting the Cities of Champlin and
Minneapolis have increases over 6%.
Mayor Willson noted the Fire Department clothing allowance and safety equipment were less
and stated he would not want to see them shorted on safety equipment or clothing allowances as
an organization. Mr. Boganey confirmed those amounts are what the Fire Chief requested.
Mayor Willson noted the year-to-date totals could double and remain under the maximum.
Mr. Boganey offered kudos to all Department Heads as their requests, without exception, were
based on looking at every line item, forecasting based on changes that may be occurring, and a
thorough line-by-line analysis before making a request.
Mayor Willson also complimented staff on the excellent work done on the budget, noting it is in
line with past increases in the 5-6% range.
Councilmember Ryan stated a minor concern relating to funding the Earle Brown Days Parade,
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noting the Lions Club makes a significant contribution ($3,000-$4,000) but may not be able to
continue doing that. He asked whether there is enough in the Contingency Fund to cover the cost
of the parade. Mr. Boganey stated there is an ability to do something over and above what is
budgeted but he thinks the Community Activities, Recreation, and Services (CARS) budget
included expenses associated with the Earle Brown Days Parade so they may have already taken
into account a potential reduction in funding from the Lions Club.
It was Council consensus to recommend the City Council approve the 2018 Preliminary Budget
and maximum levy of 5.14%, as presented.
Request for Crime Statistics Report
Mayor Willson mentioned LexisNexis, an on-line service showing crime data for the Metro area.
He said he would like to talk with the Police Chief to learn how current those numbers are,
noting the data shows first-tier suburbs are experiencing more crime. Councilmember Graves
stated she attends the monthly Hawthorne neighborhood association meetings, during which
crime statistics are presented.
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Councilmember Graves moved and Councilmember Lawrence-Anderson seconded to adjourn
the Work Session at 7:27 p.m.
Motion passed unanimously.
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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 City
Council from the City of Brooklyn Center Joint Work Session with Financial
Commission held on September 18, 2017.
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 25, 2017, Regular Session.
City Clerk
Mayor
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