HomeMy WebLinkAbout2014/07/21 - ADMIN - Minutes - City Council - Study Session ff� St. Louis Park OFFICIAL MINUTES
MINNESOTA CITY COUNCIL SPECIAL STUDY SESSION
ST. LOUIS PARK,MINNESOTA
JULY 21,2014
The meeting convened at 6:45 p.m.
Councilmembers present: Mayor Jeff Jacobs, Tim Brausen, Steve Hallfin, Gregg Lindberg,
Anne Mavity, Susan Sanger, and Jake Spano.
Councilmembers absent: None.
Staff present: City Manager (Mr. Harmening), Deputy City Manager/Director of Human
Resources (Ms. Deno), Controller (Mr. Swanson), Finance Supervisor (Mr. Heintz), and
Recording Secretary(Ms. Hughes).
1. Delinquent Utility Accounts
Ms. Deno, Mr. Heintz and Mr. Swanson presented the staff report.
Councilmember Sanger expressed concern about the high delinquency rate and recidivism rate
and stated it appears a significant number of people pay their account balance right before
certification to avoid the administrative fee and interest charges. She felt the City should raise
the penalty fee and interest rate and questioned whether the City should certify accounts twice a
year or change the penalty structure as a way to reduce the number of people who pay right
before the deadline. She stated she would also like the penalty to escalate for those accounts that
are certified more than once and felt that publishing the certification list may be a waste of
money if the list is printed in small type in the newspaper and does not get anyone's attention.
Mayor Jacobs spoke in favor of adding the administrative fee prior to certification.
Councilmember Mavity stated she did not feel that people were purposely not paying their
account balances and was hesitant to raise the administrative fee too much. She felt that account
balances go unpaid when people are hard on their luck and that the vast majority of people would
choose to pay their bills on time and it was her inclination not to increase the fees.
Councilmember Hallfin asked if there was any way the City could get more information about
the people who were not paying their accounts consistently and perhaps reach out to them to
figure out what is going on.
Mr. Heintz stated analysis was done of the data on properties certified and there was not
correlation that could be found between property value and certifications. Data was analyzed in
many different ways by accounting staff to see if there was a pattern and no pattern was found
regarding this matter.
Councilmember Brausen felt the City should raise the interest rate so that delinquent accounts
are paying a legitimate rate for using City services. He stated he was not in favor of publishing
the certification list and was not in favor of shutting off services.
Councilmember Spano supported restructuring the penalty system to incrementally increase the
penalty, e.g., the first time penalty is $30, the second time penalty is $50, and the third time
penalty is $75. He also supported raising the interest rate.
Special Study Session Minutes -2- July 21, 2014
Councilmember Lindberg asked if these measures would take a lot of staff time and did not want
to see the City spending resources chasing after money that it is already collecting via the
certification process. He stated he was amenable to raising the interest rate.
Councilmember Mavity stated she was less in favor of increasing interest rates and did not see
this issue as a big problem for the City, adding that the City has a system in place and is
collecting its money through certification and was fine with the current system.
Councilmember Brausen stated that he was okay with raising the administrative fee and adding a
fee prior to certification, and increasing the administrative fee with certification and reviewing
interest rates for a possible increase, adding that he would also be okay with doing nothing.
Councilmember Lindberg stated he would be okay with leaving it the way it is and could also
support Councilmember Brausen's suggestion.
Councilmember Spano stated the City has the second highest delinquency rate and felt that
having an escalating administrative fee would send a signal that the City is using staff time to
track down unpaid accounts and certifying delinquent accounts and felt this would send a
reasonable and measured response to those who are repeat offenders.
Councilmembers Mavity and Lindberg agreed.
Councilmember Hallfin stated that any of the suggestions are good suggestions but was also
okay with leaving the system as it is. He suggested adding a $15 administrative fee prior to
certification and having the administrative fee increase to $30 if the account is certified to cover
the extra work required by staff.
Ms. Deno stated that staff would prepare information for Council consideration on a multi-tier
penalty system, adding an administrative fee prior to certification and reviewing the amount of
administrative fee with certification, as well as review and possible changes to the interest rate
being charged. This information will be provided to Council during this budget process
timeframe.
The meeting adjourned at 7:14 p.m.
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