City Council Minutes

Pursuant to due call and posted notice thereof, the budget workshop meeting was called to order at 5:05 p.m. by Mayor Mary Hershberger Thun in the Council Chambers at 7951 Rose.

Members Present: Mayor Mary Hershberger Thun; Councilmembers: Tim Amundsen, Jim Paulsen, Kim Roden and Rick Tieden.

Absent: None.

Staff Present: Don Uram, City Administrator; Holly Kreft, Community Development Director, Jylan Johnson, Finance Director, Bruce Osborn, Public Works Director; Scott Manion, Finance Committee; Ann Mahnke, Field House Director; Jennifer Kretch, City Clerk; and Tim Walsh, Fire Chief.

Others Present: Sue Orsen, The Victoria Gazette, Unsie Zuege, The Chanhassen Villager and others.
 

Mr. Uram noted that all departments were invited to answer any questions. He stated the workshop outcome is to obtain the City Council’s concurrence to the proposed 2009 tax levy, general fund budget and the field house budget.

Mr. Uram reviewed the creating public value chart.

Mr. Uram said the four principles of the budget process are as follows:

1. Establish Broad Goals to Guide Government Decision Making

2. Develop Approaches to Achieve Goals

3. Develop a Budget Consistent with Approaches to Achieve Goals

4. Evaluate Performance and Make Adjustments

Ms. Johnson reviewed the proposed levy limit for pay estimated based upon the 2008 general fund levy. She noted the general fund levy has an overall increase of 6.7%.

Ms. Johnson talked about the tax impact. She said there is an $8.93 increase in tax. She noted there was less than a 1% increase in home value.

Ms. Johnson reviewed the 2008 and 2009 levy comparison. Councilmember Roden clarified that the reduction in the field house is with the ISD 112 agreement. Ms. Johnson noted the overall increase in the 2009 levy was 8.5%.

Ms. Johnson reviewed the fund revenues. She said the City has kept the tax rate flat. She showed a graph of the general fund expenditures. Councilmember Roden asked what percentage was engineering. Ms. Johnson responded about 20%.

Ms. Johnson reviewed the City of Victoria Field House. She said the operations are in part with the joint powers agreement with ISD 112. They are proposing establishing a fund balance of approximately $132,000.

Ms. Johnson presented the following recommendations:

Ms. Johnson talked about the opportunity to start saving for a new public works facility and city hall by starting a stabilization fund.

Mr. Uram commented on the budget process and said they looked at how it impacts the taxpayers and the services provided.

Mayor Hershberger Thun asked where the stabilization fund is coming from. Mr. Uram explained that a stabilization fund can be created by dedicating the excess in revenue received over the budget amount.

Councilmember Paulsen commented on the additional $233,000 set aside for discretionary items in last years budget and asked if they were successful in capturing that. Ms. Johnson said yes.

Mayor Hershberger Thun asked how much of the $600,000 would be used for the inter-fund loan and how much for saving for future facilities. Mr. Uram stated that the allocation for each would be based on a long-term financial plan for the City of Victoria.

Councilmember Paulsen commented on the levy increase and asked if that is sustainable. He talked about being over-funded and the debt service being 25% of the total expenditures in the City. He questioned having too much debt and cutting expenses. Mr. Uram explained the goal over time is to reduce the amount of debt to some number. Councilmember Paulsen asked how they stack up with other cities. Mr. Uram responded they are petty low compared to other cities.

Councilmember Roden talked about the growth and permit fee revenues and the limitations with capturing those revenues. She commented on not going to the maximum and the set limitations. Councilmember Roden talked about paying back more debt and said now may not be the time to do it but in the next 36 months it should be looked at with the impact of the district 112 agreement and a residential rebound that would allow for permit fee revenue.

Councilmember Roden commented on the infrastructure expense and the five-year plan to redevelop every city owned road. She noted they are also capturing spending that wasn’t done in the previous years.

Mr. Uram said they will continue to contribute to the fire relief fund. Mr. Uram noted there are structural changes in the public works and park and recreation departments. He said there will be a future hire of a Public Works Director/City Engineer. Ms. Johnson mentioned that in the finance department there was not an allocation for the utilities schedule. Mayor Hershberger Thun noted there is minimal change in the sheriff department.

Mr. Uram explained that in surveying other cities there was generally a 3% wage increase.

Mr. Uram said he is working with the Carver County Sheriff’s office to see what services are needed for residents.

Mayor Hershberger Thun commented on going out to see if they can get better deals on some of the contract services.

Mr. Uram stated they expect to save money on the engineering contract with the new hire. Councilmember Paulsen asked how much. Mr. Uram said he estimated $20,000.

Councilmember Paulsen questioned a three-year budget and imposing stress tests. He asked if the City could run on 10-15% less. Mr. Uram said the trade off would be a cut in services. Councilmember Roden commented on the community having a high level of service expectations.

Councilmember Amundsen questioned the $167,000 in the park and recreation budget. Ms. Johnson said it was pulled out of public works. Councilmember Amundsen said it is difficult to reconcile if it is not showing up.

Mr. Uram said they are expecting to present the budget at a meeting in August and they have to certify the levy by September 15^th.

Mayor Hershberger Thun stated she is comfortable with what has been done and she is glad some of these funds are being established.

Councilmember Amundsen said it is a matter of where they get the additional funds.

Councilmember Amundsen commented on items being over and being more accurate. Mr. Uram said they are going to sit down on a monthly basis with all the key department people to walk through the line items.

Councilmember Paulsen said he is not ready to make a motion. He said they are moving in the right direction.

The budget workshop adjourned at 5:59 p.m.

Respectfully submitted,

Tanya Schmieg
TimeSaver Off Site Secretarial, Inc.