Minutes - Council Work Session - 05/12/2015

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of upcoming capital needs, she would ask whether excess revenues should go to the Park Improvement Fund and General Fund monies should go to the Park Maintenance Fund. Or, whether the Park Maintenance Fund should be eliminated. Mayor Strommen stated she and David Elvig served on the Council when the Park Maintenance Fund was created, noting it was ironic that the Park Maintenance Fund was created to address long-term financial stability yet the staff report tonight indicated the reason to eliminate that Fund was to address long-term financial stability. Mayor Strommen stated she had invited former Councilmember Elvig to attend tonight's Work Session to review the past discussion and determination to create that Fund in 2004. David Elvig, 18026 Ute Street NW, explained it was a different time when the City was able to draw in a lot of funds, a group was developing parks, and there was money in the pool. But then the issue of maintenance was raised and how it could be paid for. At that point, staff was asked to provide information on what the parks would cost to maintain long-term. Mr. Elvig stated in addition, Anoka had parks that had been developed for years but came to a situation of having to consider whether to sell parkland or close the parks because they had no new park revenue or maintenance dollars. He stated in Ramsey, some funds were running at 4.5% to 6% so the Council considered that if an endowment could be created, revenue could be generated to pay for park maintenance on a yearly basis. Ramsey was receiving additional dollars because of development so the Council identified 10% for this park maintenance use. He noted it is a similar situation with the roads that the City constructed and now needs funds to maintain and reconstruct. Mr. Elvig stated it may not be totally effective and in need of tweaking but it is important to have a maintenance concept. Mayor Strommen stated the circumstances have vastly changed since this was put into place but it is still important to assure the City can maintain what it builds. She reviewed the options that could be considered. City Administrator Ulrich supported having a cap on the annual expenditure or percentage the fund will be spent down in any one year or to designate 'x' amount of dollars. He stated this Fund grows slowly and cannot be relied on for maintenance or it will not last very long so he recommended placing restrictions on use of the Fund. Finance Director Lund suggested a cap of $500,000 instead of $3 million as that probably cannot be achieved. She reviewed the dollar amounts that had been transferred into this fund from excess revenue. Mayor Strommen asked if the proposal is to leave the Excess Revenue Policy in place so funds would continue to come into the Park Maintenance Fund. Finance Director Lund answered in the affirmative. Mr. Elvig stated several years ago the City held a lot of pooled funds, which the State encouraged the City to spend down, and then the `crunch' hit so it was good the City had those funds because those dollars were vital for four to five years during the economic downturn. City Council Work Session / May 12, 2015 Page 8 of 11