08/26/2003 - City Council Special
MINUTES
SPECIAL CITY COUNCIL MEETING
AUGUST 26, 2003
5:00 P.M.
EAGAN MUNICIPAL CENTER - COMMUNITY ROOM
City Councilmembers present: Mayor Geagan, Councilmember Carlson, Councilmember
Fields, Councilmember Maguire and Councilmember Tilley.
Staff present: City Administrator Hedges, Assistant to the City Administrator Lord, Director
of Administrative Services VanOverbeke, Chief Financial Officer Pepper, City Engineer Matthys,
Fire Chief Jensen, Chief Building Official Schoeppner, Senior Planner Ridley, Police Chief
Therkelsen, Superintendent of Streets Struve, Director of Community Development Hohenstein,
Parks and Recreation Office Supervisor Mesko, Superintendent of Recreation Asfahl,
Superintendent of Parks Olson, Director of Communications Garrison and Police Captain
McDonald.
I. ROLL CALL AND AGENDA ADOPTION
City Administrator Hedges noted that the City Council has been invited to the Rotary Band
Shell for an event after tonight's meeting. Hedges also informed the Council that the bowling fund
raiser for Patriot's Plaza this weekend has been cancelled. Hedges requested that under Other
Business the City Council discuss a memo that was received from the League of Minnesota Cities
regarding lease/lease back of water and wastewater systems, as well as the issue of vacation
balances that the Council previously discussed when receiving the presentation of the CAFR from
the auditors.
Councilmember Fields moved; Councilmember Maguire seconded a motion to adopt the
agenda as presented. Aye: 3 Nay: 0 (Councilmembers Carlson and Tilley not yet present.)
II. VISITORS TO BE HEARD
There were no visitors to be heard.
III. CONSIDERATION OF DRAFT 2004 GENERAL FUND BUDGET AND
PROPOSED 2004 LEVY CERTIFICATION
City Administrator Hedges introduced the item. Hedges informed the City Council that
consideration of the 2004 preliminary budget and certification of the preliminary 2004 tax levy are
scheduled for the September 2, 2003 City Council meeting. Hedges noted that once the preliminary
levy is set, the Council can always choose to lower the levy, but cannot choose to increase the levy.
City Administrator Hedges summarized the budget as proposed, noting that the City of Eagan has
the lowest per capita expenditures of cities of 50,000 people or more, as well as the lowest per
capita personnel compliment of comparable cities. Hedges presented a summary of the community-
wide citizen survey results pertaining to the quality of life, City services and property taxes.
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August 26, 2003
Page 2
Councilmembers Carlson and Tilley arrived at 5 :20 p.m.
The City Council discussed whether to increase user fees. After noting that an increase to user
fees to the median in comparable cities could potentially generate in excess of $225,000, the City
Council voiced their support for increasing certain fees, generating $150,000 in additional revenues.
The Council requested that fee options be brought back to the Council, as well as information
showing comparisons to other AMM cities.
Director of Administrative Services presented information on the City's market value, tax
capacity, tax rates, and property tax impacts. City Administrator Hedges concluded the presentation
with a summary of the contingency and fund balance, as well as information regarding the
Cedarvale Special Services District and Debt Service Levy. The City Council discussed the use of
the contingency funds and there was consensus that the contingency be used in 2004 for General
Fund activities and operating expenses.
The City Council agreed with the Truth and Taxation hearing dates as presented. City
Administrator Hedges noted that the hearing dates of December 1 and December 8 will be on the
City Council's September 2, 2003 agenda for ratification.
Councilmember Carlson noted that the City Council had been fiscally prudent in 2003 by not
levying to the maximum levy limit, and now is being penalized by not being able to levy back the
amount the City Council did not levy in 2003. Carlson voiced her frustration that the City is now
being penalized.
The City Council discussed the proposed 2004 levy, and agreed that the City must levy to the
maximum levy limit given the circumstances in 2004, resulting from the loss of LGA and HMVC
aid. City Administrator Hedges informed the Council that the preliminary tax levy will be on the
agenda for the September 2, 2003 City Council meeting, at which time it would be in order for the
City Council to approve the maximum preliminary tax levy.
The City Council discussed the individual departmental budgets, noting the necessary costs
for election judges in 2004. The Council also discussed the proposed volunteer coordinator position
and agreed that the position should not be implemented in 2004. There was City Council consensus
to delay the opening of the Central Park sliding hill in 2004. The Council discussed the July 4th
celebration, and specifically the suggestion that funding be obtained via a community fundraiser, as
suggested by members of the 4th of July planning committee. The Council was in agreement that
any funding received through the fundraiser would be much appreciated; however, funding should
not be anticipated. The Council voiced their agreement with the suggestion that staffing be reduced
at the Lexington, Ridgecliff, and Carnelian ice rinks.
The City Council discussed the current employee hiring freeze. The Council agreed that all
vacant positions should be evaluated as to whether or not they should be filled in the context of
overall City staffing. The City Council referred the employee hiring freeze to the Personnel
Committee in order for the committee to develop a template to evaluate vacant positions.
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August 26, 2003
Page 3
The City Council asked for responses to the following questions pertaining to the 2004
preliminary budget:
. What are the consequences of the revenue "building blocks" as presented, including
administrative transfers?
. What fee increases are being proposed, and what fees would be significantly increased?
. What would the affect on the budget be when Central Park is opened, i.e. staffing allocation?
. What would be needed to keep full service at the class B skating rinks?
The City Council thanked staff for their work and presentation of the 2004 preliminary
budget.
The City Council recessed at 7:00 p.m. The City Council reconvened at 7:05 p.m.
IV. REVIEW OF ALL SPECIAL FUNDS
City Administrator Hedges introduced the item, noting that the 2002 Annual Financial Report
was presented to the City Council for adoption in June of 2003. At that time, the City Council
requested that a time be scheduled to review the fund status of all general fund, special revenue,
debt service, capital project, enterprise, and internal service funds that compromise the overall
comprehensive financial operations of the City. City Administrator Hedges summarized the memo
that was prepared for the City Council regarding the City's funds status. The City Council
discussed the funds status information that was presented and thanked staff for the work in
preparing the memo.
V. OTHER BUSINESS
City Administrator Hedges noted that franchise fees were not presented as a revenue option in
the 2004 preliminary budget. Hedges also informed the Council that cities are anticipating
legislation at the state level that would tighten cities' ability to implement franchise fees. The City
Council discussed the use of franchise fees and noted that since the preliminary budget as presented
is balanced, they would prefer to wait to see what the legislature does. The Council directed staff to
monitor legislation regarding franchise fees and inform the City Council if there are any changes.
City Administrator Hedges summarized a memo received from the League of Minnesota
Cities regarding the possibility of the League partnering with Allco Financial Corporation to create
a financial transaction whereby Minnesota cities can raise immediate cash through the leasellease
back of their water and waste water systems. The City Council directed the issue to the City
Council Finance Committee (Mayor Geagan and Councilmember Carlson). The Council also
requested that the memo prepared by the League of Minnesota Cities be forwarded to the City
Council as a whole.
City Administrator Hedges noted that the Council had previously discussed a policy
regarding employees' vacation balances, which came out of the report provided by the auditors.
The City Council directed the policy consideration to the City Council's Personnel Committee
(Mayor Geagan and Councilmember Carlson).
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August 26, 2003
Page 4
The City Council also directed that the Personnel Committee address issues of compensation
regarding the level at which the City Administrator and Department Directors are compensated.
The City Council directed staff to bring back the General Fund Operating Budget to the City
Council at a workshop in order to address the issues and questions raised at tonight's meeting.
VI. ADJOURNMENT
Councilmember Fields moved; Councilmember Tilley seconded a motion to adjourn the
meeting at 7:20 p.m. Aye: 5 Nay: 0