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ARDEN HILLS CITY COUNCIL WORK SESSION—AUGUST 26, 2013 2 Director of Finance and Administrative Services Iverson stated that this could not be kept in a separate fund any longer due to GASB (Government Accounting Standards Board) regulations. She explained that TCAAP has been put in its own department within the General Fund to allow for expenses to be tracked under the new regulations. Mayor Grant requested a summary on the budget items that would be increasing in 2014. Director of Finance and Administrative Services Iverson indicated that these budget items are listed on page five of the staff memo and are mainly: public safety, curb and sidewalk repairs, a transfer to the equipment building replacement fund and TCAAP. These increases totaled about $118,698; however,there would be some offsets for TCAAP. Mayor Grant explained that the City has a levy limit of 3%. He noted that 1% equaled $33,500; therefore, a 3% levy would allow the Council to increase its budget by approximately$100,500. Director of Finance and Administrative Services Iverson commented that additional revenue in the budget totaled approximately$119,000. She indicated that if the Council wanted to achieve a 0% levy increase,the budget would need to be cut by$95,737. Further discussion ensued regarding personnel and interns. Director of Finance and Administrative Services Iverson handed out a memo to the Council on personnel and"headcount changes" in the proposed budget. Councilmember Holmes inquired how many additional FTE's would be added to the 2014 budget. Director of Finance and Administrative Services Iverson commented that the City's FTE's would remain the same, however the intern positions within the City's departments would shift. She further discussed the differences between interns and part-time staff. She noted that in 2012, the City had 30.35 FTE's with 26 full time employees. Mayor Grant explained that after this evening's budget discussion, the Council would need to decide on a levy amount. He asked if there were any expenses that the Council wanted to cut or reduce. City Administrator Klaers stated that the legal expense estimate for 2014 is increasing due to an increased use of the new City Attorney. Councilmember Holmes requested further information on the TCAAP expenses planned for 2014. Director of Finance and Administrative Services Iverson stated that $63,000 has been allotted to legal fees, financial consulting fees, professional services, postage, and miscellaneous expenses. Mayor Grant asked if the budget was prepared using potential franchise fees.