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ARDEN HILLS SPECIAL CITY COUNCIL WORK SESSION— SEPTEMBER 9, 2024 15 Councilmember Monson would prefer to use funds to help support the personnel costs of the market adjustment. She wants that to stay under$155,000. She doesn't like the initial calculation of 20% levy increase. She understands it can be lowered after the preliminary levy approval, but she would like to lower the preliminary number now, if possible. Councilmember Holden asked what mandates are unfunded. She reminded there are other discussions that have not happened. Discussion ensued regarding what impact it would have if certain items were delayed or removed. Finance Director Yang summarized that she heard direction to update to reduce the Equipment and Replacement Fund by $110,000 and $30,000 for the street maintenance program. Public Works Director and City Engineer Swearingen said he is nearly certain he can reduce the entire street maintenance program amount to $0. He will just need to make some calculations based on a bigger project next year. He received the street maintenance condition results. The City is in really good shape. The Karth Lake neighborhood will be taken care of in 2026 and the rest of the city is in a maintenance period. Councilmember Holden would like staffs input on the Comp and Class Study. She is concerned that Council discussion was one thing and that it seems the direction has changed. She noted some employees are at the top of their range and other cities are looking for good employees. She asked if there are any dangers in changing course now. Public Works Director and City Engineer Swearingen stated that the first option doesn't feel like there is any immediate benefit. In the past two to three years, the COLA increase has not met inflation costs. Staff is hopeful that the market study will, at minimum, address the inflationary piece. With Option 1, Staff will have to wait at least three years before seeing the full benefit. Option 2 makes the market adjustment. Assistant to the City Administrator/City Clerk Hanson said she has heard from other cities that have recently been through this process and some of them feel they are already behind after two years. The question is if this change will be outdated in two years. Finance Director Yang said when staff originally saw the proposal there was some excitement over the possibility of room to grow. She agreed changing to the other option now will not be as much as they originally expected. The $155,000 amount is adding/dropping three steps and reclassification based on the market analysis. Using the $124,000 amount defeats the whole purpose of having a market adjustment because you're being reclassified but then you're being bumped down steps. Councilmember Holden was not originally in favor of the $155,000 option but she thinks it's wrong to pull that back now. Mayor Grant asked Councilmember Holden if she is in favor of the $155,000. Councilmember Holden replied no, she isn't. However, that is what was proposed at the last work session.