HomeMy WebLinkAboutCity Council Packet 09-04-2001 SpecialAgenda
City of Plymouth
Budget Study Session
Tuesday, September 4, 2001
7:00 p.m.
Police Training Room
Call to Order
2. Discuss 2002 Proposed Budget
Adjourn
DATE: August 31, 2001
TO: Mayor and City Council
FROM: Dwight D. Johnson, City Manager
SUBJECT: Follow-up to August 29 Budget Study Session
At the August 29th Budget Study Session, staff was asked to research and evaluate a
number of questions brought forward by members of the Council. In addition, staff has
several items of new information and recommendations to make based upon new
information or evaluation in the last few days.
The following are responses to the questions and issues brought up by Council members
on August 291h
1. Can we include the calculation on tiered water rates on the utility bills?
The utility billing software will not support the printing of the individual calculations
for each water billing tier. If we want to show these calculations, it likely can be
done with custom programming. We will look into the cost of having this done.
2. How many ACH (Automated Clearing House) utility customers do we have?
We currently have 19,450 utility customers, of which 2,901 use the ACH payment
function. Of these, 147 are commercial/industrial users and 2,754 are residential.
3. Is there need for an Economic Development Program?
Plymouth does not currently have an identified "economic development program"
in its budget or organizational structure. However there are many on-going, related
activities which support job growth and business development in the City, including
answering general business inquiries about the City and its services, and providing
technical assistance on licensing, building and zoning requirements for businesses.
Staff also works with businesses through the Twin West Chamber and through other
City programs that are used by businesses and their employees.
In addition to on-going services, the City also responds to specific requests and
projects on an as -needed basis. The City works with eligible companies to secure
tax-exempt financing (Industrial Development Revenue Bonds) or state grants that
require City participation (for example, the Minnesota Economic Recovery Fund
MERF) grant/loan provided to Value Rx a couple of years ago.) The City has also
used its economic development and redevelopment powers to provide tax increment
financing (TIF) for economic development and redevelopment projects. Recent
examples include Olympic Steel, Plymouth Technology Park and the 2300
Berkshire projects.
Current staff resources for economic development projects are limited primarily to
part of the Community Development Director's time with support from other staff.
As a result of the MERF grant, we will soon begin to offer a revolving loan fund to
provide gap financing for local businesses.
Plymouth has been fortunate to attract jobs and businesses by virtue of its desirable
location and available development opportunities. Some area cities find it necessary
or desirable to be more proactive in promoting jobs and business development.
This higher level of effort may include:
creating specific staff position(s) to coordinate economic development
activities;
budgeting for advertising and promotion;
identifying and recruiting specific types of jobs and businesses to locate in
the community;
working with land owners to seek out users for vacant land and buildings;
providing local financial incentives;
developing and implementing efforts to retain existing jobs and businesses;
identifying and promoting needed redevelopment projects; or
establishing and supporting entities such as an EDA (Economic Development
Authority) or Port Authority if needed to fulfill the City's objectives.
The forecast of both the Met Council and the City's Comprehensive Plan for job
growth shows Plymouth gaining about 14,000 more jobs before 2020. Plymouth
will likely increase its efforts toward redevelopment in the coming years. When
that occurs, there would be an opportunity to create a position that would work on
both re -development as well as some targeted new economic development activities.
Adding a staff member to begin a more significant effort would probably have a
minimum budget impact of about $100,000 per year (salary, benefits and equipment
for full-time staff position, support services and a modest budget for advertising and
promotion.) We do not recommend this for 2002.
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4. Review the budget for Web page redesign and E -government.
The Council had approved a budget allocation of $25,000 in the 2001 budget for Web
page redesign. The project has been "on hold" pending information on the severity of
the anticipated budget shortfall this year. Since the permit revenue forecast has
improved for 2001, we recommend moving ahead with the Web page redesign
immediately (this project will take several months so the final product will not appear
until 2002.) Accordingly it is recommended that the 2002 budget be reduced by
25,000.
No funds are proposed in the 2002 budget for e -government. We may gain some e -
government capability from the new Web for Cities product; however, there is little
possibility of offering on-line payments or any other on-line service of the magnitude
of ReConnect. An additional investment of approximately $125,000 would be
needed in next year's budget just to provide the groundwork for delivery of e -
government services to the public. The largest part of this increase would be $95,000
to upgrade our Oracle operating system.
5. What is the amount of bus fares collected and who gets them? What is the
current fare amount shown in the transit budget?
Fares are collected by the contract service providers (Metro Transit and Laidlaw
Transit), and reported monthly on their respective invoices. These fares are shown
as revenue on the transit budget to partially offset the expense of the contracted
services. Fare revenue for 2002 is projected to be about $480,000.
There is also a line item (Acct. #7025) for Bus Passes Purchased of $3,200. This is
what the City pays to the contract providers for the purchase of bus passes to have
on hand at City Hall for resale to the public.
6. Is there any funding liability for CrimNet?
CrimNet will be integrated into an existing statewide system line. The Legislature
appropriated monies to the BCA for technology upgrades and to the Minnesota
Department of Public Safety to purchase and distribute equipment. Our data
migration has been completed by LOGIS. A funding commitment on behalf of the
state will be necessary for at least the next two bienniums to complete connections to
outstate areas. The system itself will be managed by state employees. We already
pay a user fee for this system (our BCA connection), and that will remain our only
expense.
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7. Review allocation of $2,000 for Charter Commission.
The Charter Commission is entitled by state statute to spend $1,500 per year. The
amount of $2,000 has been budgeted each year since the Charter was enacted, but that
amount has rarely been spent. The 2002 budget line item for the Charter Commission
is recommended to be reduced by $500, from $2,000 to $1,500.
8. Provide additional information on human service funding requests, including
the City's funding policy.
Attached are the requests submitted by each human service agency for 2002 funding,
as well as the City's Policy Relating to Funding of Human Service Agencies. We
have also attached information on the current funding provided to agencies through
the federal CDBG Program which is administered by the HRA.
Home Free. Staff has some new information about Home Free. The City has no
written contract with Home Free. We are partnered with New Hope, Crystal, and
Golden Valley. Fixed costs are divided equally among the four cities. The remainder
is allocated through a combined percentage of population and use. The Police
Department is currently checking out the option of a new agency for these services —
Northwest Domestic Violence Program at Family and Children's Service. The new
organization is recruiting the cities of Plymouth, Brooklyn Park, Champlin, Crystal,
and Golden Valley. Preliminarily, it appears that the new provider could be $10,000
or so less per year for Plymouth. The cities of Crystal and Golden Valley have given
their intent to leave Home Free. This would not increase Plymouth's contribution
beyond $33,000; however, Home Free would cut staff and services. The police
department continues to study this issue and will be making a recommendation
shortly. The police department is mandated to provide some domestic abuse services.
CICC. Since the Communities in Collaboration Council is not a direct provider of
service, but a school-community collaborative, it is difficult to quantify whatever its
benefits are to the community. Before cutting the contribution to the CICC, the
Council should consider the intangible cost and the message sent if we do not
participate in a collaborative effort with our largest school district and the various,
non-profit agencies, churches, and other cities in the collaborative. It also appears
that in the next few years, the County may be working more closely with the 17
collaboratives throughout the County.
Northwest Human Services Council. Staff does not have enough information.to . .
advise the council cin whether o'r how much'to paftieipate in this organization'next
year. They have already asked to speak to the Council for 10-15 minutes later in
September, and it might be wise to withhold any decision until that time.
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If there are questions about the other agencies, they also could be invited to a council
meeting between now and December for a short presentation.
9. Review the impact of the supermajority vote requirement. Does it apply to the
preliminary levy adoption in September? What levy rate is assumed if the
Council fails to adopt the budget by a supermajority vote?
There is a City requirement that two-thirds majority of all members of the council
must adopt a tax levy resolution if the city's tax rate is increased. In the City
Attorney's opinion, the initial or preliminary levy resolution adopted in September
does not raise the tax rate and does not require a super majority vote.
The 2001 Legislature enacted a provision that overrides charter provisions that limit
the ad valorem tax rate. Arguably, the override provision applies to our charter
provision. However, it does not clearly do so because our charter provision is not a
rate cap, but simply a voting requirement. If this becomes an issue, the City Attorney
will research it further.
If a city fails to certify its levy by the required date (Dec. 20), the levy shall be the
amount levied for the preceding year. Plymouth's levy amount in 2001 was
14,213,011. Therefore, if the Council failed to adopt a tax levy, $3,737,559 would
need to be cut from the currently proposed City budget.
10. Provide an update on road analysis.
Engineering staff plans to update the Pavement Management Plan to revise the road
ratings and analysis to include the street reconstruction projects and new mill and
overlay projects approved for 2001 as soon as a new Design Civil Engineer is hired
and trained on the software program. We will share the revised analysis when it is
completed this Winter.
11. Review the roadway landscaping budget.
The proposed reforestation budget for 2002 is $57,000. This is already reduced from
the amount of $65,000 in 2001. This fund is used to replace dead trees and to
landscape parks. This account has paid for some roadway landscaping such as Bass
Lake Road in the past. No new boulevard or median planting projects are proposed
for 2002. The entire amount would be used for tree replacement and landscaping in
the City's parks.
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12. Can the Council lower the City Council salaries?
The City Attorney indicates that the Council cannot raise or lower council salaries
until after the next election. An ordinance is adopted before an election with an
effective date after the election.
13. Review budget for various festivals.
Attached is cost information relating to the City's special events. There are revenues
from vendors and sponsors related to most events, and the net result is that direct
revenue exceeds direct expenses. The cost of staff time (recreation, park
maintenance, police, fire, communications) has not been included. The Chocolate
Sampler is not listed because it is a fundraising and profit-making event.
The City Council has indicated a desire to budget $25,000 for Music in Plymouth,
allowing the Plymouth Civic League to request up to an additional $5,000 if needed
for their 2002 event. Park Director Blank will send a letter to the Civic League
notifying them of this action after adoption.
14. Are new positions covered by facility revenue?
The proposed full-time maintenance worker and part-time maintenance salaries for
Plymouth Creek Center are $65,668. Revenue at Plymouth Creek Center is projected
to increase by $60,000 in 2002.
The salary cost for the part-time Section 8 Clerk is $28,364. This will be fully
covered by federal Section 8 administrative funds.
The increase in hours for the Office Support Representative for the Fire Department
results in a General Fund increase of $22,913. There is no off -setting revenue for this
position.
The cost for amending the position of Transit Manager to Public Works Manager is
4,210. The new position is proposed to be funded from the General Fund (25%) and
Transit Fund (35%), with the remainder split between the Water, Sewer, Utility
Trunk, and Solid Waste Funds. The position change would increase the General
Fund by $15,957, although the overall cost impact over all funds is only $4,210.
There is no offsetting revenue.
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15. Review Council conferences and seminars budget.
The City Council conferences and seminars budget for 2002 is proposed at $4,500,
which is identical to 2001. This year, about $2,900 has been expended to date. The
actual amount spent would have been more except several members have used
personal frequent flyer miles or stayed with relatives in lieu of City -paid lodging.
The actual amount spent in Council conferences and seminars in 2000 was $6,928.
16. Review budget for recognition events. There are several amounts budgeted for
recognition events. Each of the events is listed, along with the amount budgeted for
each event.
Recognition Events
Events for all full-time employees
and paid on-call firefighters
Police recognition event
Fire recognition event
Volunteers' recognition event
Board & Commission recognition event
Amount Budgeted
16,000 (This was reduced from
21,000 in 2001)
5,000
2,300
3,000
2,500
17. Review budget for staff training and conferences.
These are the budgeted amounts for 2002 for staff training and conferences for all
full-time, part-time, and paid -on-call employees. The amounts include required and
optional training.
Employee training $118,780
HR City-wide training $20,000 (drug and alcohol, sexual harassment, etc.)
Conferences/Seminars $52,762
The total amount for training and conferences is about 1 percent of the General Fund
budget, which is below the normal business standard of 2-3%. If any reductions are
made in this area, they should come from the conferences and seminars line, since
there could be legal consequences to reducing many of the other forms of training.
18. Review budget for subscriptions and memberships.
The total amount budgeted for subscriptions and memberships in the General Fund is
24,850. These amounts are typically for professional memberships for employees in
various departments and helps keep them in contact with information and trends in
their respective fields.
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19. Review budget for cell phones.
The total General Fund budget for cell phones is $36,000. Usage breaks down as
follows:
Police $22,200
Park maintenance 5,440
Inspections 3,750
Fire 1,750
All other divisions 2,860
Given the large proportion of employees in the field, we believe that we will lose
efficiency if this item is reduced.
20. Review budget for mileage.
The General Fund contains a total of $9,935 for mileage. A portion of this amount is
under contract. Employees do not receive mileage as a benefit. It is reimbursement
for use of personal vehicles doing city work. If we didn't provide mileage
reimbursement, it would likely create a backlog of pool vehicles and the possible
need to add more vehicles to the fleet.
21. Review budget for sealcoating.
The proposed 2002 budget for the sealcoating program is $277,000. Of this amount,
84,000 is for crack repair, $143,000 is for the sealcoating contract, and $50,000 is
for street patching material.
Several years ago, we researched sealcoating extensively, but could find no
conclusive evidence that it is effective in prolonging street life. There are studies
that indicate the skid resistance of streets are improved, thereby improving safety.
Crack filling followed by seal coating has also been shown to increase the life of
streets. One is typically not done without the other, therefore, it is difficult to
quantify the benefits of simply one or the other of these efforts. The street
maintenance and engineering divisions believe that the City's current maintenance
program, which involves patching, crack filling, and seal coating, all work together
to prolong the life of our streets.
If the Council would like to reduce or eliminate sealcoating for 2002, I would suggest..
that the funds be redesignated for street reconstruction so that our overall effort to
maintain our streets is not reduced.
22. Publish notice of December budget hearing in local paper.
A news release will be issued in early December announcing the budget hearing.
Summary of Recommendations. Staff makes the following recommendations based
upon the discussion in this memo as well as several new items noted below.
A. Delete $25,000 for Web page redesign (project would be done with 2001 funds).
B. Delete $500 from the Charter Commission line item.
C. Increase the building permit revenue by $35,000. We have reviewed the building
permit forecast and considered the preliminary approval of the Stone Creek Village
development last week and believe this can reasonably be done.
D. Offset some fire temporary salaries by $2,000 by charging for-profit companies for
presentations and programs they request during non -duty crew hours.
E. Increase the revenue from antenna leases by $6,000, based upon the approval of an
antenna at LaCompte Park last Tuesday evening.
The total amount of adjustments in items A-E is $68,500.
The decision on the funding of social service agencies should be deferred at least a few
more weeks to see if the alternative program to Home Free is viable and to hear directly
from the Northwest Hennepin Human Service Council representatives. Other agencies
can also be invited to make brief presentations to the Council if so desired.
ME