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ARDEN HILLS CITY COUNCIL WORK SESSION — SEPTEMBER 18, 2017 2 Councilmember Dave McClung said it is hard for taxpayers to differentiate an Operating levy from a Capital levy. Mayor David Grant requested a high level description of what will be done at Moundsview, Irondale, Chippewa and Highview schools as a result of the referendum passing. Ms. Westerman said Moundsview High School is the oldest building in the system. They will expand the second floor classrooms and add more with a net of seven classrooms. They will also add gymnasium space, cafeteria and update the HVAC system. She stated Chippewa is one of the newest buildings, but the entrance area will be updated to be more secure and a swimming pool will be added. Irondale will have the auditorium expanded, the pool shut down and a fitness space put in its place. Superintendent Lennox added that Highview would have a secured entrance and additional space for music. Councilmember Fran Holmes asked if the two schools that were closed would be reopened and how are they being used. Ms. Westerman replied that they are being used for Pre -Kindergarten and Kindergarten. Councilmember Steve Scott inquired about HVAC work at the schools. Superintendent Lennox said the HVAC work will be done on older systems as needed, and with any schools that have additions to the buildings. Ms. Westerman stated that the School Board would appreciate support from the Council individually or as a body and noted that property values are related to the level of schools. Mayor Grant responded that the Council as a body doesn't take a position on how someone should vote but they can lend support individually if they choose. B. 2018 BUDGET DISCUSSION Interim Director of Finance and Admin Services Dave Perrault presented a slide show highlighting items in the Preliminary 2018 Budget. He stated home values are rising at 8.3%. Both the fiscal disparity and taxable value have increased by about 10%. He noted the budget is based on assuming no levy increase, a 2.5% COLA increase, a reduced antenna revenue, the police contract increasing by 4%, fire contract increasing by 6%, an increase in transfers of 24%, and a staffing increase of .5 FTE's. He showed a scenario of a 3% increase in the levy, as well as the General Fund balance projection. Senior Planner Matthew Bachler discussed the EDA Revolving Loan Fund. The State Legislature passed a law giving the City a one time exception in which the City would be paid back 80% of the balance and the remaining 20% would be returned to the State. The 80% could be used anywhere in the City budget. As of December 2016, approximately $133,000 would be available (the Revolving Loan Fund balance is approximately $167,000). The City has until June of 2018 to decide if they would like to request the one time exception. If the City does not use the