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recommendation on the 2004 budget until after the legislative session as the State Legislature has <br />yet to make a decision on extension of levy limits. Complicating the problem of LGA reductions <br />are the immediate needs of the City. Staff is utilizing its full resources to meet the challenge of <br />the exciting Town Center project. It has become increasingly evident that significant problems <br />will be encountered if the City does not have an adequate staffing level. Administration was <br />preparing to make a proposal to create two new positions in the City staff; an Associate Planner <br />in Community Development and an Engineer in the Engineering Division of Public Works. <br />Since the addition of two new positions would have financial implications, staff will include the <br />budget impact in the 2003 discussion. <br /> <br />Finance Officer Lund stated that the current Governor's proposal for 2003, which has been <br />introduced in the House of Representatives, include a reduction in State Aid in the amount of <br />$477,968. Staff proposed addressing the 2003 budget reduction utilizing 2002 year-end revenues <br />over expenditures, 2003 line-item reductions, and consideration of revenue generating resources. <br />A summary of the recommendations was presented to the Council for their review. Two of the <br />most significant factors in the proposed budget adjustments are the redirection of the 2002 year- <br />end revenues over expenditures and the creation of a franchise fee. The City appears to have a <br />total of $274,307 remaining from the year-end of budget 2002 that can be utilized to address the <br />current budget crisis rather than following the policy that redirects the year-end monies to three <br />separate funds. Creation of a franchise fee appears to be the course many cities throughout the <br />Metropolitan Area and throughout the State are considering as a tool to assist in addressing the <br />current State Aid reductions. Creation of the franchise fee this year will not only play a much <br />larger role in addressing the aid reductions for 2003, but it also could begin early enough to assist <br />with the reductions for the 2004 State Aid losses. Some of the budget expenditure line items will <br />have a significant impact on the public. Reducing seasonal help will translate into a reduced <br />schedule of maintenance in the parks and reductions in the community education program could <br />see reductions in the youth program and summer program. In regards to the 2004 budget <br />reductions, the State Legislature is still weeks away from development and adoption of a final <br />budget package; it may not be appropriate to begin making reductions for the 2004 budget. Staff <br />believes that it is a safe assumption that the State Legislature will eliminate the entire State Aid <br />package of $764,986 in the 2004 budget year. What is not known at this time is whether levy <br />limits will be extended or be removed or some type of reverse referendum for levy increases be <br />added as a City requirement for levy increases. <br /> <br />Councilmember Kurak stated that there is an upcoming convention for the City Council and <br />inquired how that impacts the proposed travel reimbursement cuts. <br /> <br />City Administrator Norman recommended that they review all of the proposed cuts and then <br />corne back and discuss items in question. <br /> <br />Assistant City Administrator Nelson noted that she needed direction on funding for Happy Days. <br /> <br />Councilmember Cook stated that they have had some discussions on eliminating the parade. <br /> <br />City Council Work Session/April 29, 2003 <br /> Page 6 of 15 <br /> <br /> <br />