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HomeMy WebLinkAbout2013/08/19 - ADMIN - Minutes - City Council - Study Session Jft St. Louis Park OFFICIAL MINUTES MINNESOTA CITY COUNCIL SPECIAL STUDY SESSION ST. LOUIS PARK, MINNESOTA AUGUST 19, 2013 The meeting convened at 6:30 p.m. Councilmembers present: Mayor Jeff Jacobs, Steve Hallfin, Anne Mavity (arrived at 6:34 p.m.), Julia Ross, Susan Sanger, Sue Santa, and Jake Spano. Councilmembers absent: None. Staff present: City Manager(Mr. Harmemng), Deputy City Manager/Human Resources Director (Ms. Deno), Police Chief (Mr. Luse), Director of Inspections (Mr. Hoffman), Director of Operations and Recreation (Ms. Walsh), Chief Information Officer (Mr. Pires), Director of Community Development (Mr. Locke), Controller (Mr. Swanson), Finance Supervisor (Mr. Heintz), Housing Supervisor (Ms. Schnitker), Fire Marshal/AC (Mr. Smith), Fire AC (Mr. Coppa), and Recording Secretary(Ms. Hughes). 1. 2014 Budget Discussion Mr. Harmening presented the staff report and advised that Council must certify the preliminary 2014 property tax levy prior to September 15, 2013, and reminded Council that the property tax levy can be reduced at the time of final adoption in December but cannot be increased. He noted that the City's operating needs would require less than a 2% levy adjustment, however, the City continues to have significant capital needs and a 3.5% levy increase takes into consideration some of the operating cost increases the City will experience in the future, including sidewalks and trails and a possible community center. Mr. Swanson explained that levy limits are in place and based on discussions with the State and League, the City's property tax levy increase could be as much as 5.76%. He stated the City levied $24.7 million in 2013 and this amount included debt service and for 2014, the City is allowed to use its 2013 levy and add in special levies for debt services, or$1.4 million, for a total of$26.2 million. He stated the City will receive approximately $458,000 in local government aid in 2014 and 2015 and staff proposes to keep that money in the capital replacement fund and not in the General Fund. He advised that personnel costs represent the most significant expenditure in the City's budget and noted that all five union contracts are open in 2014 and the City will see increases to PERA for police and fire. He stated the City is continuing its wellness initiative and proposes a wellness benefit increase of $5 per month for 2014; in addition, the City's health insurance will likely see a significant increase between 25-30% and staff proposes a $100 per month increase in the employer benefit contnbution. Councilmember Sanger asked if the City should build in any extra capacity for the City's fiscal disparities contribution. She also asked if the City has any funds built into the budget in the event of litigation related to light rail. She also asked if the budget includes money for continued consulting services related to the community center. She also asked if the City has enough staff in the Community Development and Engineering departments. Mr. Swanson stated the City has not yet received its fiscal disparities information but staff believes the City's contribution will increase slightly from last year, adding the recommended 3.5%levy adjustment is sufficient to encompass the City's fiscal disparities contribution. Special Study Session Minutes -2- August 19, 2013 Mr. Harmening advised the City has not set aside money for potential litigation regarding light rail and stated the City's insurance would provide coverage if the City was sued. Mr. Swanson stated the City does not have additional resources in the budget related to consulting services for a community center but if the City moves ahead with a community center, the City would issue debt then reimburse itself from the proceeds. He indicated the Community Development and Engineering departments requested interns but there were no other requests for additional staffing. Ms. Deno pointed out that an additional engineer position has been included in the budget. Mr. Locke felt the Community Development department was appropriately staffed at this time and stated an intern started this year and consultants are being used as well. Councilmember Mavity expressed concern that a 2% wage adjustment and $100 per month increase in the employer benefit contribution for health insurance may not be sufficient to keep up with inflation. She stated the City asks a lot of its employees and wanted to make sure the City remains competitive and felt it was important for the City to compensate its staff well. Ms. Deno indicated the City does a compensation analysis each year to review positions within the market and a 2% wage adjustment is reasonable. Councilmember Spano requested further information regarding the CIP. Mr. Swanson stated the Capital Replacement Fund is projected to go into deficit at the end of this year or early next year and the proposed property tax levy will dedicate $500,000 to this Fund which will solve some of the challenges in this Fund and will provide several more years for the City to resolve any deficit in later years. Councilmember Mavity asked if the budget includes any additional money for capital improvements the City may want to make as part of the SWLRT project and indicated it may be helpful to have some funds set aside in the budget for these types of improvements because it is likely the City will not get all the money it has asked for in the SWLRT project. Mr. Harmening replied the budget does not contain anything specific related to infrastructure improvements for light rail. He agreed this issue would be discussed further with staff. Mr. Swanson advised that Council allowed $265,000 of operational dollars in the 2013 levy and this amount is included in the 2014 levy, which means if a 3.5% levy increase is approved for 2014, the City will have another $379,000 of available resources or approximately $650,000 per year set aside for opportunities that may present themselves. He stated the City used available pooled TIF dollars in the Elmwood TIF district and the City could do something similar for opportunities related to light rail. It was the consensus of the City Council to proceed with certifying a preliminary property tax levy increase of 3.5% for 2014 on September 3, 2013. It was also the consensus of the City Council to proceed with certifying a 5.38% increase in the HRA levy for 2014 on September 3, 2013. Special Study Session Minutes -3- August 19, 2013 2. Mayor, City Council and Economic Development Authority Compensation Mr. Harmening presented the staff report. Councilmember Sanger stated Council could either raise salaries to be consistent with wage adjustments for City employees or it could reinstate the 5%decrease in salaries taken in 2010. Councilmember Hallfin suggested that the Mayor, Council, and EDA salaries be written into an ordinance that states any salary increases are the same as City employee wage adjustments. Ms. Deno advised the EDA salaries are set by resolution but Mayor and Council salaries are set by the City Charter and cannot include automatic wage adjustments unless the Charter is changed. She added that Mayor and Council salaries can only change during election years. Councilmember Spano stated he had no interest in raising his salary. Councilmember Mavity felt that tying any salary increases to coincide with wage adjustments for City staff made sense. It was the consensus of the City Council to direct staff to schedule a public hearing regarding a 2% salary increase for the Mayor and City Council to be effective January 1, 2014. It was also the consensus of the City Council to direct staff to prepare a resolution regarding a 2% salary increase for the EDA Commissioners and EDA President to be effective January 1, 2014 The meeting adjourned at 7:14 p.m. , 1/ Nancy Strot , City Clerk Jeff Jac 0 .1 /yor