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HomeMy WebLinkAbout2020 08-03 CCM Joint FinancialMINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL/FINANCIAL COMMISSION OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND STATE OF MINNESOTA JOINT WORK SESSION AUGUST 3, 2020 CALL TO ORDER The Brooklyn Center City Council/Financial Commission Joint Work Session was called to order by Mayor Elliott at 6:30 p.m. The meeting was conducted via Zoom. Mayor Elliott thanked everybody who tools the time to join this very important meeting. He added the City faces grave economic challenges as a community and as individual households. He noted there is an eviction moratorium at the State level, and mortgage forbearance program for federally backed loans, with private lenders extending the same courtesy to mortgage holders. He stressed the importance of crafting a budget that acknowledges these realities. ROLL CALL Present were Mayor Mike Elliott and Councilmembers Marquita Butler, April Graves, Kris Lawrence -Anderson and Dan Ryan. Also present were Financial Commissioners Teneshia Kregness, David Dwapu, Dean Van Der Werf, Taofeek Ishola and Emmanuel Kpaleh. Also present were City Manager Curt Boganey, Finance Director Mark Ebensteiner, Community Development Director Meg Beekman, and City Clerk Barb Suciu, APPROVAL OFAGENDA There was a motion by Councilmember Ryan and seconded by Councilmember Butler to approve the agenda as submitted. The motion passed. INTRODUCTIONS Councilmember Dan Ryan stated he is in his 14tI' year of service on the City Council. Councilmember April Graves stated this is her 6th year on the City Council. Councilmember Marquita Butler stated this is her 01 year on the City Council, Councilmember Kris Lawrence - Anderson stated this is her 8th year on the City Council. Commissioner Teneshia Kregness stated she has served on the Financial Commission for 10 years. Commissioner David Dwapu stated this is his 2nd year on the Financial Commission. Commissioner Taofeek Ishola stated this is his 1st year on the Financial Commission. Councilmember Kpaleh stated this is his 2nd meeting. Commissioner Dean Van Der Werf stated he has served on the Financial Commission since 2011. OPERATING B UDGET VALUES DEVELOPMENT Mayor Elliott stated this is the second budget meeting, and this meeting will focus on the operating budget. and 12.9% in 20201; and industrial tax capacity is 11.1 % in 2020 and 11.5% in 2021. Mr. Boganey noted residential properties will pay less of the levy share and the median residential property value will increase to $207,000 in 2021. Mr. Boganey stated a 3-5% increase in utility fees is anticipated as bond payments will need to be made in 2021 to fund utility improvements. Mr. Boganey stated it is anticipated that 2020 taxes will not be paid at the same rate as they have been historically, due to the pandemic. He added the general fund shortfall was originally expected to be over $2 million, but the good news is that the shortfall is now anticipated to be closer to $1.1 million. He noted City Staff have made efforts to reduce budgeted costs in the general fund budget, and an allocation of $2.4 million was received from the federal government to offset Covid-related costs. Mr. Boganey stated TIF District #3 is scheduled for decertification in 2021, which will result in an increase in taxable market value of nearly 10% in 2022. The City will have the opportunity to reduce tax rates overall by 2023 and generate revenue at a higher rate. Additionally, the City's current Franchise agreements will expire in 2023, creating an opportunity for renegotiation. Bond replacement and special assessments can be significantly reduced, and the costs covered with renegotiated franchise fees. Mayor Elliott stated it would be helpfiil if the slide presentation had footnotes that indicate the data source. He added, for example, he would like to have information about projections for commercial and residential property taxes, and about market value forecasts. He asked whether the forecasts for property market values is based on the change in property values from 2018-2019, or 2019-2020. Mr. Boganey stated values for taxation lag by 1 year, so residents will pay taxes on the value of properties last year. Mayor Elliott stated he was asking how the change is calculated, and whether it is a forecasted change. Finance Director Marc Ebensteiner stated the team "forecast" is not used by Hennepin County, but rather they go through a process of evaluating properties to set taxes to be collected in 2021. The values are already set by the county for each of the property classifications. Mayor Elliott asked whether the County bases their projects on the previous year. Mr. Boganey stated it is not a proj ection, but rather a valuation, that is based on data previous to January 2, 2020. Mayor Elliott stated where he is going with this is that what happened before January 2, 2020 is very different from what happened after January 2, 2020. He added the question is what budgetary implications do these projections have for Brooklyn Center, as they are not reflective of the reality of 2020. Mr. Boganey stated the County's valuations are part of a formula, and they are not projections. The property valuations are established on January 2, 2020 and do not reflect how property values will change in the coming year. 8/03/2020 Page 3 Mr. Boganey stated the deepest impact of the current recession is likely to occur in 2020 and early in 2021, based on the status of federal stimulus legislation and conditions related to the pandemic. He added CEAP has been providing hundreds of thousands of dollars for rent assistance. He noted many groups are affected differently, as 1 out of 2 black Minnesotans have applied for unemployment, compared to 1 in 4 white Minnesotans. City Staff believes Brooklyn Center is likely to be more affected by the recession than other communities. Mayor Elliott stated the City has a lot of naturally occur7ing affordable housing, as opposed to legally binding affordable units. He added this affordability is an economic competitive advantage. He noted it is important to understand how tenuous the affordability is in Brooklyn Center, Commissioner Kpaleh stated he is concerned about how apartment owners and renters, as there is no control and they have their own rules. He added the City loses tax income when people move away from Brooklyn Center. He asked whether the City has any control that they can leverage on property owners. He noted, for example, apartment complexes do not allow visitors, and cars will be towed. He asked what the City can do to give rights to tenants so there will be more occupants, and units will not be empty. Mayor Elliott stated Commissioner Kpaleh's questions for City Staff are whether the City has control over landlords increasing rent, and not allowing visitors to park. Commissioner Kpaleh stated he is not asking about increased rent, but rather severe rules that landlords impose on renters. He added, because of this, people are moving to different cities and the population is decreasing. He asked what can be done to get more people to move to Brooklyn Center and boost the population. Mr. Boganey stated population growth in Brooklyn Center has been significant over the last 5-10 years. He added the City can influence the availability of rental properties by building more units, which is being done, and continues to be done. He noted he agrees that an increase in population can be good for the economy and livability of the City, but Brooklyn Center has not had difficulty in terms of population growth. Mr. Boganey stated, with regard to regulating management of rental properties, the City's authority is limited. He added, however, the city can exercise regulatory authority when it is deemed necessary For health and safety. Ms. Beekman stated the Community Development staff addresses property issues and license complaints. She added anyone who has a question about a specific property can contact City Staff and it can be addressed separately. Ms. Beekman stated City Staff is undertaking a review of tenant protections within City Ordinance, in an effort to strengthen a tenant protection Ordinance adopted in 2019. She added cities are limited in their authority over landlords. She noted the City Council will be reviewing a naturally occurring affordable housing preservation program, and discussion around mixed income policy. 8/03/2020 Page 5 Councilmember Lawrence -Anderson stated she does not see anything offensive about the mission or vision statements. She added she is not opposed to revisiting these policy statements with the new Mayor at some point. She added, however, she truly believes in both the vision and mission statements that were adopted by previous City Councils. Councilmember Butler asked where this question is coming from, regarding whether the policy statements are harmful or problematic. She added the mission statement was adopted four years ago, during her tenure. Mr. Boganey stated the City's budget should reflect the adopted values of the City Council. Councilmember Butler stated she is fine with the policy statements and does not have any questions or comments, nor does she feel that they are harmful. Councilmember Ryan stated he is fine with the mission and vision statements, as well as the stated values and strategic priorities. He added the priorities stated within them provide sufficient flexibility to rise to the challenges that are being discussed tonight. Councilmember Graves stated she does not find the policy statements problematic at all. She added they are really just statements about what the City Council wants to focus on, and how to support the community. She noted they are well -crafted, inclusive and wholistic. Councilmember Graves stated the real challenge is what the values will mean in the budget; how the City interacts with community members and business owners; and how quickly and efficiently the City implements these values. Mayor Elliott stated there is a lot of value in the policy statements as they are ow. He added the City Council should review them in a few years as a matter of practice, based on current conditions within Brooklyn Center, Mr. Boganey asked the City Council would consider customer service and operational excellence as important values. Councilmember Graves confirrrred this, adding she has no objections. Mr. Boganey asked whether the City Council supports the six strategic priorities under which the City has operated for the past four years: enhanced community image; residential economic stability; inclusive community engagement; targeted redevelopment; safety, security and stability, and key transportation investments. Mayor Elliott stated he believes these strategic priorities need to be adjusted, but not at tonight's meeting. Councilmember Graves asked whether Mayor Elliott can provide a few points for discussion. 8/03/2020 Page 7 Commissioner Kpaleh requested consideration of having a redevelopment process. He added there are a lot of vacant buildings in the City. He asked whether there is anything the City can do in the future to fill the vacant buildings and increase redevelopment in the City. Mr. Boganey stated targeted redevelopment has been a priority in Brooklyn Center for many years. He added the Community Development Director works actively with developers and other parties to look for ways to support redevelopment. He noted the City has had success with a number of projects in progress, including Jer7y's Food site, Brooklyn Boulevard reconstruction project, single family homes on 252, and housing proposals on 2 different sites on Brooklyn Boulevard, Mr. Boganey stated he would be happy to schedule a separate conversation with Commissioner Kpaleh to review redevelopment activities and provide additional information. CouncilmemberLawrente-Anderson thanked City Staff and the City Manager for all their hard work on behalf of the residents of Brooklyn Center. CouncilmemberLawrente-Anderson stated residential economic security is a key point, and a safe and secure community is paramount. She added she supports assistance for all of the City's businesses, not just start-ups and entrepreneurs. She noted all local businesses help the community by generating tax revenue. She noted safety is critical. Mayor Elliott stated the City Council has identified resident economic stability and a secure, stable community as two priorities, but probably does not agree on what that means, as they are broad categories with a myriad of programs and solutions. He added, in terms of resident economic stability, there should be money in the budget to support mortgage and rental assistance, as well as assistance for nonprofit organizations that sustain residents in times of great unemployment and economic crisis. Mayor Elliott stated housing and food security and mental health issues are a crucial part of a safe, secure community. He added the City Council must grapple with the meaning of a safe, secure and stable community, and what meaningful adjustments are required within the budget to achieve it. Mayor Elliott stated the City Council is already committed to addressing these issues but should also specifically name the issues of racial justice, economic justice and addressing disparities within the community. Mr. Boganey asked what outcomes residents should be expected to experience next year for the City Council to feel that the City has been successful in malting meaningful progress toward achieving priorities. Mayor Elliott stated historical data should be reviewed to have a baseline around evictions and foreclosure rates. He stressed the importance of peeping those rates low, however that is defined. Councilmember Graves stated she agrees a baseline would be helpful. She added the City would need to work in collaboration with Hennepin County as they already provide rental assistance, 3/03/2020 Page 9 Councilmember Graves stated she is not available to join the meeting either Thursday or Friday due to a prior commitment, She added she can review the materials submit comments to City Staff before the meeting, There was a Mai ority Consensus of the City Council and Financial Commissioners to hold a follow- up Work Session on Friday, August 7, 2020 at 6430 p.m. Mr. Boganey stated the meeting would be approximately 90 minutes. He agreed to send meeting packets ahead of time for advanced preparation. Councilmember Graves requested that any items that require Consensus fi•om the City Council be included in the information that City Staff sends to her prior to Friday's meeting. Mr. Boganey agreed. ADJOURNMENT There was a motion by Councilmember Graves and seconded by Councilmember Ryan to adjourn the meeting at 9:21 p.m. The motion passed. STATE OF MINNESOTA) COUNTY OF HENNEPIN) ss. Certification of Minutes CITY OF,BROOKLYN CENTER) The undersigned, being the duly qualified and appointed City Clerk ofthe City ofBrooklyn Center, Minnesota, certifies: 1. That attached hereto is a full, true, and complete transcript of the minutes of the City Council fi•om the City of Brooklyn Center Joint Work Session with Financial Commission held on August 3, 2020. 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 August 24, 2020, Regular Session. 1 City Clerk 8/03/2020 Page 11