Minutes - Council Work Session - 11/26/2013

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Option A: Hold City's tax rate constant with 2013 adopted rate of 44.288% ($159,000 levy decrease from adopted preliminary levy) Option B: Hold City's tax rate to preliminary staff report estimate of 43.37% ($341,000 levy decrease from adopted preliminary levy) Option C: Hold City's tax rate to preliminary rate from Anoka County of 45.095% ($0 levy decrease from adopted preliminary levy) Finance Director Lund referenced the list of proposed levy reductions included in the staff report. She stated in the 2014 budget, it was proposed to have a 2.5% COLA and that was reduced to 2 %. It takes into consideration that some have waived insurance so that number can be cut. The other two items relate to the Economic Development position savings from 2013 and 2014 because it was not yet known what step that position would start. In 2013, a higher amount was budgeted under HRA. She stated the EDA budget is being reduced by $15,000 and will be considered by the EDA in December. She stated the items listed under Strategic Planning were included in the 2014 budget and the Council could consider whether to reduce any of them. Finance Director Lund noted one of the strategic planning goals was to maintain a stable tax levy rate City Administrator Ulrich reviewed the 2013 -2015 Balanced Scorecard relating to Fiduciary Perspective and explained the need to consider a balanced equity so if staff positions are reduced, it may impact some of the Strategic Plan's initiatives or an adjustment may be needed. He also reviewed the Customer /Stakeholder Perspective, Internal Perspective, and Learning and Growth Perspective. City Administrator Ulrich felt it can be managed to get close to the tax capacity rate and if within a reasonable percentage, it would be considered a stable tax base. He felt a 2 -3% increase would still result in a stable tax base. Finance Director Lund presented information relating to Community Program/Service. Contributions, noting the majority comes from the General Fund. City Administrator Ulrich stated the City provides staff support to most of these organizations as well. He stated some organizations (i.e., mediation services) save staff time, are a service to the public, and have been eliminated in past budgets, but it can be discussed whether the organization actually saves staff time and police resources. Councilmember Riley stated the Finance Committee discussed the preliminary budget, tax capacity rate, and what cuts would be needed to get the tax capacity rate down. The Finance Committee suggested the Communications line item be removed and asked staff to return with potential items that could be cut. He noted the 43.37% rate was publicized, even though subject to change. Councilmember Riley stated support to get back close to that percentage. Mayor Strommen recalled that during the original discussion, the Council gave direction to stay at last year's rate. Councilmember Kuzma stated he would opt to go with Option A, the 2013 rate, because he thinks that level of budget cuts is feasible. City Council Work Session / November 26, 2013 Page 2 of 9