HomeMy WebLinkAbout2019/05/13 - ADMIN - Minutes - City Council - Study Session Official minutes
City council study session
St. Louis Park, Minnesota
May 13, 2019
The meeting convened at 6:10 p.m.
Councilmembers present: Mayor Jake Spano, Tim Brausen, Steve Hallfin, Rachel Harris, Anne
Mavity, Thom Miller, and Margaret Rog.
Staff present: City Manager (Mr. Harmening), Chief Financial Officer (Mr. Simon), Director of
Inspections (Mr. Hoffman), Police Chief Harcey, Fire Chief Koering, CIO (Mr. Pires), Director of
Operations and Recreation (Ms. Walsh), Engineering Director (Ms. Heiser), Deputy City
Manager/Human Resources Director (Ms. Deno), Director of Community Development (Ms.
Barton), Finance staff (Mr. Ebensteiner), (Ms. Mauseth), (Ms. Monson), (Ms. Simonsen),
Management Assistant (Ms. Carrillo Perez), Communications Manager (Ms. Smith), and
Recording Secretary (Ms. Pappas).
Guest: Mike Sable, Facilitator with The Work of Leadership
1. 2020 Budget/Maintaining Financial Sustainability
Mr. Harmening stated the process will be done a bit different ly this year. He stated the council
will use a systems thinking approach and how they influence each other, and also address
financial needs more strategically, while considering operations, programs, policies and
opportunities for St. Louis Park. He explained the discussion around the 2020 budget this year
will include the use of a facilitator, Mike Sable of The Work of Leadership .
Mr. Harmening stated the community is in strong financial health at this time, and the city has
the luxury of doing system planning at this time.
Mr. Sable gave his background, noting he has extensive history in city government and this type
of work in cities. He is looking to help the council clarify budget considerations and a path
forward, along with operational risks of the city, and discussing concerns of both staff and
council. He stated he hopes questions can be answered, and clarity will be found during the
discussion this evening.
Mr. Harmening reviewed policy considerations including the following, noting the first item has
the highest priority:
Does council have sufficient information to provide parameters to staff for 2020 budget
development?
Does council have sufficient information to provide direction on capital and debt service
plans for 2020 and future years?
Are there shifts that need to be made for continued fiscal health and sustainability while
taking into consideration strategic priorities and overall service delivery for the city’s
system?
What additional information would the council wish to review during the upcoming
budget and capital processes?
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Mr. Harmening noted the systems within the city, adding it is a natural location which is to its
advantage. He added there are 2,000 businesses within St. Louis Park, with over 50,000
employed in the city. He stated 10’s of thousands pass through the city each day and more will
in the near future with the SWLRT, which has an impact on the city’s system. The value of the
property within the city is $8.7 billion. There are 24,000 housing units in the city and the
population trend is growing older and becoming more diverse. Mr. Harmening stated the city’s
buildings and services total worth is $300 million, and the community is a very high-touch place
to live. Mr. Harmening added the community values include, that it is responsive, collaborative,
and quality-oriented. The city’s core services are strong, which allow it to be able to be
progressing in other areas.
Mr. Simon stated St. Louis Park is a full-service city with over $260 million assets to manage and
replace. It is a AAA rated city, one of 26 in Minnesota, with a strong economy, strong budgetary
flexibility and liquidity, and strong budget performance and debt profile. It is only one of a few
cities that look 10 years out with a capital improvement plan which is updated annually.
Mr. Simon reviewed the tax levy percentage changes since 2010, noting incremental changes
vs. larger impactful changes, adding the 10-year average is 4.5%. He noted the 2019 tax levy
breakout, with 81% in the general fund, 3% in park improvement, 10% debt service, 5% Capital
replacement fund, and 1% employee administrative fund. Mr. Simon also reviewed the city’s
general fund revenues and expenditures.
Mr. Simon noted fluctuations as well, including items such as the climate action plan and wind
source program costs adjusted for the 2020 budget. He also pointed out infrastructure
reinvestment projects including state-aid road, pavement management program,
watermain/sewer/storm, Connect the Park, fleet and building repairs, and park improvements.
GO bonding estimates include SWLRT, Connect the Park, and additional sidewalk segment
projects.
Mr. Sable began the discussion with council.
Councilmember Harris asked how council should gauge debt capacity vs. residential appetite for
tax increases. Mr. Sable stated that local governments must do this every year and the good
news in St. Louis Park is the council has worked through this before and has good skill at this.
Mr. Harmening added this is more of a political question, where elections play a role . He added
the council can also influence some of this by making decisions to not do certain projects and
then mitigate, and be more strategic on certain items, while making choices.
Councilmember Mavity asked about the undesignated fund used in the past fo r budgeting
unplanned items that may come up during the year, and how this fund works . Mr. Harmening
noted this year’s undesignated funds were used for racial equity project s, climate action, and
ranked choice voting. In 2020, these three items will have their own line item.
Councilmember Rog stated she does not see a difference between the city’s core services and
strategic priorities, adding these items intermingle. She noted she would like to look at
budgeting on operational assumptions.
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Mayor Spano asked if staff looks at including costs of maintenance and repairs on projects, as
part of the total cost, or if this is added in after the fact. Mr. Harmening stated this has been
done, but not consistently, pointing out Connect the Park as a project that typically will have
more costs added on, due to clearing snow off sidewalks, or plowing. He stated staff will do
more planning on this moving forward.
Councilmember Hallfin asked how the council should budget for snowplowing. Mr. Simon
stated staff looks at trends over the last 3 years and then estimates.
Councilmember Miller stated he has been a critic on how budgeting is done in the city, adding
when looking at it from a business perspective, he would start with a tax levy percentage year
over year, then break it down year by year, depending on the budget and what the council is
committed to doing. Mr. Sable noted that service reductions will be felt by residents, and would
be a concern.
Councilmember Brausen stated priorities should be determined, th en budgeted. He noted it is
hard to analyze return on investments, adding he would like to see the details and breakdown
on fire and police budgets and how that is reflected in the city’s strategic priorities, in order to
better understand.
Councilmember Rog added she feels conflicted, especially when she hears many residents say
they are concerned about taxes, but then also say that they love what St. Louis Park is doing .
Councilmember Mavity added as the council works on budgeting, they need to involve the
larger community in the process, so they are not being swayed one way or another by a few
loud voices.
Mayor Spano added he is not hearing a large groundswell of folks saying the city is on the
wrong track, but conversations with the community are important.
Councilmember Hallfin stated having been in budgeting process for profits and non-profits, this
discussion is reasonable, but noted the city’s tax levy has been relatively stable the last few
years. He stated the council cannot look at this like a business, and must look at the history of
budgeting and taxes for the city. He added the city is doing right by the citizens of St. Louis Park
by providing the services they are asking for, while keeping tax rates relatively stable over time .
Councilmember Miller added he does not want to suggest the city run government like a
business; however, there is a budgetary process, and there must be a way to free up money for
strategic spending, such as renewable energy projects. He added he would like to see the city
carbon neutral by 2040 by spending a certain amount over the years, and get this in as a line
item now.
Councilmember Rog stated the council needs to look at other opportunities for funding besides
the levy.
Mayor Spano added the council will need to look at what are the most impactful projects to
spend money on, and how comfortable it would be for the city to hand out money to
businesses for climate action work.
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Councilmember Brausen asked how long the city is committed to Connect the Park. Mr.
Harmening stated it is a 10 year commitment and the city is in the 5th year of construction.
The council came to a consensus that the tax levy sh ould fall somewhere between 3-6% for the
2020 budget. However, Mayor Spano noted with the climate action plan, the rate could be
higher.
Councilmember Mavity stated she feels like the city is absolutely on track, adding she does not
support a 3% tax levy, unless some items are not funded. She stated this rate is not realistic,
and she is not looking for major disruptions. She added the council needs to be strategic, and
not do across-the-board cuts. Councilmember Mavity added she has not heard an outcry from
the community to stop doing something, as it relates to the climate action plan, she would be
interested in hearing proposals for upfront one-time investments in equipment or strategy that
are innovative and cost-saving, in order to get to long-term stability.
Mr. Harmening thanked the council for their comments, stating it is important for staff to know
where the council is on this, in order to know the work staff will have to do. He added if the
council is looking for a dramatic shift, staff will need to know this sooner rather than later .
Councilmember Rog stated she would like to see the budget process done differently this year,
with more detail, and engagement with the public, on a more interactive and dynamic level .
She added she would like to see staff provide more engaging communication vs. only
explaining.
Mayor Spano added he would like to see staff provide open houses for residents on the budget
process, perhaps at the Rec Center. He would like to see staff walk through the budget process,
and explain that and TIF and how it all works, as it is difficult for folks to understand .
Councilmember Mavity added it will be important for the city to frame this correctly, while
explaining how home values have increased, and corrected.
Councilmember Harris asked how the city monetizes strategic goals so as to know how much to
spend in order to achieve the objective, especially related to affordable housing, climate action,
and race equity.
Councilmember Rog added she would like to have staff look at outcome-based budgeting also,
and present creative ways to achieve goals and costs. She added it is time to reexamine various
projects within the city, such as Connect the Park, and look at the ROI, especially as costs are
going up. She added there may be places where the council can scrutinize items better, and
look for places to save.
Councilmember Brausen stated, however, the city’s system is working well, and the council just
examined pavement management in depth last year. He added he is concerned about
micromanagement, and trusts staff to look for places to save, and bring that information back
to council.
Councilmember Mavity added council has laid out strategic priorities and staff built a budget on
those items, including changes in climate action. She stated council needs to give staff
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boundaries, but she does not want staff to waste time on this. She noted many of the city’s
strategic priorities are how we work and not just outcomes.
Mayor Spano stated the city should take a break next year on Connect the Park, and review, to
see if it is working. He added there are new priorities now, and the city will need to consider
recalibrating to move forward.
Councilmember Brausen noted he doesn’t mind getting community feedback on Connect the
Park, but is not in favor of pausing it next year.
Councilmember Hallfin added he appreciated the discussion this evening, but also did not think
it was necessary.
Mr. Harmening stated the council will have another discussion with staff on the budget process
in June, and staff will look at additional ways to gather more public input and engagemen t into
the process, and build on that year after year.
Mr. Sable noted the dialogue did provide more clarity for staff, which will help them be better
at their work.
2. Future study session agenda planning – June, 2019
Councilmember Rog suggested if several items are on the study session agenda, one issue could
be discussed as a deep dive.
Councilmember Brausen stated the topic of Walker Lake comes up all the time, noting council
could do one deep dive on this topic, and then be done.
Mayor Spano stated he would like a deep dive discussion on the former Sam’s Club site .
Mr. Harmening asked about changing the start time for meetings to 6:30 p.m. or 7 p.m .
Councilmember Mavity suggested removing the Pledge of Allegiance from the agenda, in order
be a more welcoming community. Mayor Spano stated this will be discussed at a future study
session.
The meeting adjourned at 9:10 p.m.
Written Reports provided and documented for recording purposes only:
3. Mixed –use zoning district density bonus
4. PLACE Via Sol and Via Luna projects update
5. 2018 Housing Activity Report
______________________________________ ______________________________________
Melissa Kennedy, City Clerk Jake Spano, Mayor
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