05-21-07 Minutes - Laserfiche WebLink

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ARDEN HILLS CITY COUNCIL WORK SESSION - MAY 21, 2007 S Finance Director Iverson indicated equipment replacement funding should be addressed. She reported no reserve fund is set up for equipment replacement. Discussion ensued. Consensus was reached to establish a reserve fund for equipment replacement with parameters and policies to be developed. Finance Director Iverson reported staff sees a need to establish a reserve fund for park capital improvement. She commented the fund would be a funding source for items included in the CIP. Discussion ensued. Consensus was reached to meet with the Parks, Trails, and Recreation Committee before a decision is made. Finance Director Iverson reported on salaries and benefits. She stated that last year, the Council authorized a 2.75 percent increase for steps and COLA increases. She explained this was also the rate increase agreed to by the labor union for 2006 and 2007. She stated the labor agreement expires December 31, 2007 and a new agreement must be negotiated. She commented that for several years, Council budgeted a 3 percent increase for COLA. She explained staff sent out a survey to gather information on what other cities used over the last three years. The report showed that the average pay increase for cities surveyed was 3 percent in 2007, 2.9 percent in 2006, and 2.S5 percent in 2005. She explained the current compensation study would show the market rates; however, future COLA increases would determine ifthe City stays current with the market or falls behind. Discussion ensued. Consensus was reached that staff make an assumption, report what was done to Council and then as the budget process is discussed, Council could weigh in on the decision. Assistant City Administrator Johnson discussed employee benefits. He stated there is a loophole in the contract with the co-op whereby the City could search for the best insurance. He stated he should know the rates by late July or early August. He explained there is a three-month window of opportuoity; however, once out of the co-op, the City could not go back in. City Administrator Wolfe explained this would impact about 13 staff members and cautioned everyone on leaving a consortium. Discussion ensued.