Loading...
HomeMy WebLinkAbout11-12-24-WS-Anq,N,Hnrs Approved: December 9, 2024 CITY OF ARDEN HILLS, MINNESOTA CITY COUNCIL WORK SESSION NOVEMBER 12,2024 5:30 P.M. - ARDEN HILLS CITY COUNCIL CHAMBERS CALL TO ORDER/ROLL CALL Pursuant to due call and notice thereof, Mayor David Grant called to order the City Council Work Session at 5:30 p.m. Present: Absent: Mayor David Grant, Councilmembers Tom Fabel, Brenda Holden, Tena Monson and Emily Rousseau None Also present: Interim City Administrator Jessica Jagoe; Public Works Director/City Engineer David Swearingen; Finance Director Joua Yang and Assistant to the City Administrator/City Clerk Julie Hanson Mayor Grant revised the agenda to include a closed session to discuss Union Negotiations after the fee discussion. Councilmember Holden thought the Union Negotiation has a lot of impact on the budget and should be discussed first. Councilmember Monson, Rousseau and Fabel will defer to Mayor Grant to determine when the topic is discussed. Mayor Grant said it will be discussed as Item 3.A. 1. PUBLIC INQUIRIES/INFORMATIONAL None. 2, RESPONSE TO PUBLIC INQUIRIES None. ARDEN HILLS CITY COLINCIL WORK SESSION _ NOVEMBER 12,2024 3. AGENDA ITEMS A. Union Negotiations Council moved to a closed session at 5:37 pm. Council reconvened the work session at 6:10 pm B, 2025 Budget Discussion Finance Director Yang began the presentation on the 2025 Budget discussion. She summarized that staff reviewed and discussed the CIP Budget in July. The Operating Budget was discussed in the August and September work sessions. Council set the Preliminary Levy Budget on Septernber 23, which was the 15.5% levy increase or $823,281 over 2024. Finance Director Yang showed the changes since the preliminary levy adoption. Personnel changes were updated to reflect non-union health and dental premiums. The CIP increased by $785,000. Councilmember Holden asked if we had the final numbers for health insurance. Interim City Administrator Jagoe confirmed we had final numbers for non-union employees. Finance Director Yang said the $785,000 increase to CIP fund balance is due to decreases in some projects. Sewer lining rehabilitationin202T was set to $580,000 a decrease of $115,000. The MN-51 Connection was removed from 2026 and replaced with two new park projects resulting in a $880,000 decrease. The Hamline Avene N Trail Connection and the County Road E Trail Connection replaced the MN-51 Connection project. The Hamline Avenue project was added to 2026 for an increase of $ 160,000. The County Road E Trail project was added to 2026 for an increase of $350,000. Mayor Grant asked about the sewer lining project. He noted it was set for S580,000. He thought it was previously $475,000. Public Works Director/City Engineer Swearingen said that is a2027 project. He said the2025 number is $475,000. Mayor Grant clarified that the trail connection removed from 2026 is because we aren't paying for it not because it isn't getting done. Public Works Director/City Engineer Swearingen confirmed. Mayor Grant said the trail connection was replaced with two new park projects. He wondered how it was determined which two parks would replace it. Public Works Director/City Engineer Swearingen said the Hamline Avenue and County Road E trail connections are being done instead. Mayor Grant wanted clarification that it's not a park project but rather a trail project. ARDEN HILLS CITY COLINCIL WORK SESSION _ NOVEMBER 12,2024 Public Works Director/City Engineer Swearingen said trails are in the Parks Department category. Mayor Grant requested that future discussions should call them trail projects so when Council reviews they will be clear what the project is. Public Works Director/City Engineer Swearingen said the Hamline and County Road E projects are showing the total project cost. The $160,000 on the Hamline Trail will be split 50/50 between the City and the County. Councilmember Holden clarified that the increase is not $160,000, it's $80,000. Finance Director Yang said on the Expenditures side it's $160,000 but on the funding source side it's $80,000. Councilmember Holden understood that, but wanted to clarif,, that the cost to the City is $80,000. Finance Director Yang confirmed. Councilmember Holden asked if that was the same for the County Road E trail. Staff confirmed. Mayor Grant asked how far the County Road E trail goes. Public Works Director/City Engineer Swearingen said from Elmer Anderson Trail to Lake Johanna Boulevard. Mayor Grant asked if that would be $350,000. Public Works Director/City Engineer Swearingen said the drainage around that road will require a lot of storm water improvements. Councilmember Holden asked when we found out they were going to do that. Public Works Director/City Engineer Swearingen said he has been in discussions with the County since June or July. They are going to release their TIP soon. He has a meeting with the County and all of the City Engineers and they are going to run through the TIP. Mayor Grant said the trunk water main tower with Roseville was originally $900,000 but has now been reduced to $600,000. He wondered what happened. Public Works Director/City Engineer Swearingen said the original estimate was $375,000. Roseville is leading the design. They found they were not able to replace the existing main in the same alignment due to Department of Health regulations. They had to offset the pipes and the cost ballooned. Now they are shifting itto 2026 construction and timing it with the County's road construction and trail construction projects. The restoration costs will be significantly lower. He is still waiting on another update. The number could decrease even more. Mayor Grant asked if they will put it where it is today. Public Works Director/City Engineer Swearingen said no. They will realign it. ARDEN HILLS CITY COLINCIL WORK SESSION - NOVEMBER 12,2024 Finance Director Yang said the City-wide budget sunmary includes the General Fund, Enterprise Fund (which are the Utility Funds) and the CIP Funds. Total City-wide Revenue Budget is set at $17.1 million. Total City-wide Expenditures is set at$20.2 million. There is a $3 million negative fund balance. That is due to timing of capital projects in both the CIP Fund and Enterprise Funds. Councilmember Holden asked where the money that has been set aside for the fire station is. Finance Director Yang said Capital Outlay. Councilmember Monson asked if that was for the fire station or for fire department staff. Finance Director Yang said the $40,000 for fire staff is in the Public Safety Fund. Councilmember Monson asked what Councilmember Holden was referencing. She thought the $40,000 was for when the Safer Grant gets removed and is not related to the fire station. Finance Director Yang said it is related to the fire station. It's sitting in the Public Safety Fund. Councilmember Monson sought clarification about the $40,000 that was put aside. She thought that was for when the Safer Grant times out and we wanted to have a cushion to absorb the hit of paying full time captains. She wanted to clariff that the fire station will be funded by the franchise fees and we did not set money aside, prior to the franchise fees, for the fire station. Finance Director Yang confirmed. Councilmember Holden said that's not entirely true. She said before the Safer Grant, we knew the equipment was coming up. We were putting money aside for the fire department. Councilmember Monson asked if that was the $40,000. Councilmember Holden thought it was more than $40,000. She thought it was $70,000. Mayor Grant said it was a levy point. Finance Director Yang will have to follow up. She believes there was a $40,000 levy increase that is sitting in the Safety Fund for the Fire Captain's salary. She does not recall anything additional. Councilmember Monson said the former City Administrator did not bring it up to her. There was a discussion about how much money was being set aside for fire needs. Councilmember Holden wanted clarification that there is only $40,000. Finance Director Yang said we increased the levy by $40,000 annually to cover the Fire Captains. Councilmember Holden remembered there was $70,000. 4 ARDEN HILLS CITY COLINCIL WORK SESSION - NOVEMBER 12,2024 Mayor Grant thought the first year was $40,000, or lYo and then the second year was another 1% and the third year was another 1%. By the time we get to the forth year, you have increased by 3 lery points which would be $150,000 to pay for the chiefs, but it sounds like it's not built into this year's budget. Councilmember Holden said it went to a specific account for fire. Mayor Grant confirmed. He said that is what Council requested. The revenue that came in would go directly into the fire department's budget. Finance Director Yang will follow up on that item. Mayor Grant asked about the information on the slide regarding other taxes. He asked what the $92,000 for Special Revenue Fund is. Finance Director Yang said that was for the Cable TV Fund. Mayor Grant asked if the $435,000 is franchise fees. Finance Director Yang confirmed. Councilmember Fabel asked if the $4.3 million net change in fund balance for 2024 is deficit spending from2024. Finance Director Yang confirmed. Councilmember Fabel asked if it is projected that in 2025 there will be $3 million deficit spending. Finance Director Yang confirmed. Councilmember Fabel asked what lely level that was. Finance Director Yang said it was 15.5%. She noted the Capital Project Funds and the Enterprise Funds categories is what is driving the $3 million deficit. We don't necessarily levy that much in a year. For capital spending, we primarily focus on fund balance. We make sure there is a positive fund balance to cover future expenditures. The deficit is due to the timing of those capital proj ect expenditures. Finance Director Yang shared the City-wide summary by revenue and expenditure type. On the revenue side, 83% is generated by charges for services and taxes. On the expenditures side, 95% is from other services and charges, capital expenditures and personnel expenditures. The other services and charges represents 47o/o and includes public safety which is police, dispatch, fire, legal protective inspections, etc. The CIP is 29oh and personnel is l9oh. Finance Director Yang said in terms of wages and benefits, FTE is increasing by 0.75 due to the addition of the Parks and Recreation Manager in2025. Total personnel costs are increasing by $358,880 from 2024 to 2025. S290,870 will hit the General Fund. ARDEN HILLS CITY COLINCIL WORK SESSION _ NOVEMBER 12,2024 Councilmember Monson asked if Staff had historical personnel costs. She is curious how much was spent on hiring, salary and supporting staff. Finance Director Yang did not have that information but can get it. Councilmember Holden asked if the comprehensive study was just the steps that employees will go into. Finance Director Yang said it is the steps and reclassification of position. Councilmember Holden said COLA is3%u Finance Director Yang confirmed. Councilmember Holden asked what the allocation changes were. Finance Director Yang said that is changes based on how staff is spending their time. Previously they may have allocated 50%o to Enterprise Funds and now it's 30o . So 20o/o would move to the General Fund. Councilmember Holden asked if this is3oh for union employees. Finance Director Yang confirmed. Councilmember Holden said we know that is probably going to change. She asked if the health insurance includes union. Finance Director Yang said it is non-union and union assumptions. This is specific to the General Fund. Finance Director Yang said the General Fund revenue by sources has increased property taxes by 17.8% over 2024. There are decreases in other revenue categories. Charges for services saw a decrease in water tower rental due to the Sprint lease termination. Minor changes to youth and adult programs. Licenses and Permits assumptions are similar to 2024.Intergovernmental includes MSA funding of $113,000 as well as police training reimbursement of $60,000. The miscellaneous category includes things like lodging tax. The Preliminary Levy was set at 15.5oh and it cannot be increased. Finance Director Yang said the General Fund expenditures by department shown does not include the $50,000 transfer from General Fund to the Cable Fund, with total expenditures at approximately $6.7 million. Public Safety makes up 47o/o of the total General Fund expenditures. This includes police, dispatch, fire, emergency management and protective inspections. General Government makes tp 24o/o. Parks and Recreation makes up 15o/o. Public Works Street Maintenance makes up l4Yo. Councilmember Holden asked for clarification that Public Safety is police and fire and there is nothing we can do about those. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 12,2024 Finance Director Yang confirmed. Councilmember Holden asked for clarification that the Public Works, Parks and Rec and General Government is up to the City. She wondered if the majority of the General Government is due to pay increases. Finance Director Yang confirmed. She said she can't say the majority of the General Government is pay increases, but it is in there. Councilmember Holden would like a breakdown of that. Finance Director Yang will get that. She discussed the2025-2029 CIP. The only changes since the September 23 meeting were provided on the first slide she shared. Mayor Grant said there are some sizeable Water Department expenditures. He asked if there was enough money in the Water Fund to cover expenditures, moving forward. Finance Director Yang confirmed. She will touch on those expenditures a little later. She moved on to the 2025 Cwpital Projects with a $4.9 million projected cost. The 621 Case Loader that was worth S300,000 was mor.ed to 2026. Councilmember llolden asked if the numbers for the fire department costs were accurate. She asked ifthey have accepted a budget yet. Councilmember Monson said they have not. Councilmember Holden said so we don't know for sure. The Lake Johanna Station is in there. Finance Director Yang said that will come from franchise fees. Councilmember Monson said the budget conversation has been primarily around COLAs and market adjustments for the full-time chiefs and a little regarding some HR things. Those don't change the numbers significantly from what is there. She believes the final will be close. Discussion ensued about which positions are included. Interim City Administrator Jagoe said the Fire Station bid will be received in the early part of next year. So she didn't think there would be a more defined number for the fire station this year. We've been earmarking about $24 million. Finance Director Yang said the proposed rate increase for Utility Fund is set for water at lYo, sewer at9oh and surface water at3Yo. The sewer fund is seeing a9o/o increase due to the Met Council wastewater year over year increase that is being passed down to users. Water is seeing a }Yorate increase. However, there is an increase of $361,000 over 2024 due to the City's contract with the City of Roseville. Public Works Director/City Engineer Swearingen sent out the contract renewal and changes to Council in October. The City of Roseville hired an engineering consultant to perform a cost of services analysis on the rate structures. That analysis determined the City of Arden Hills will continue to pick up its actual usage of water purchase through the St. Paul Regional Water Services. Additionally, it will include a share of the fixed operations and ARDEN HILLS CITY COI.INCIL WORK SESSION _ NOVEMBER 12,2024 maintenance costs and an additional variable rate. Staff reviewed the contract renewal and believed the cost structure looks reasonable and it has been incorporated into the latest projections. Councilmember Holden asked if most of that was water. Finance Director Yang confirmed. Councilmember Holden asked if we need to discuss the water rate. Finance Director Yang said we set it at 0% before we knew what the new contracted rate from Roseville was going to be. The fund balance is fairly healthy, even including the increase. Councilmember Holden asked how many years it will last. Finance Director Yang pointed to the ending fund balances in the packet. 2025 ends with a $2.7 million fund balance and in 2026, it will be around $1 million. There is a fund balance of $l million through 2031.[n2032, there is a dip due to some additional street projects. Councilmember Holden thought it would be a good idea to share something in the newsletter explaining the rates are based on the fact that we have miles and miles of water and sewer lines that need to be maintained that spread over a large area. Surrounding communities are on a grid system. She doesn't know if residents realize how far we plan ahead. In two years, it will be Arden Hills 75s anniversary. Will the City do anything to commemorate that? Maybe that is a discussion for another day. She just wanted to put it out there. Finance Director Yang shared the tax impact of the 155% tax levy increase. She shared the tax lery history showing the 9-year average, excluding 2024 was 4.2%.If we included2}Z4, when the ler,y increase was 12.55oh, the 10-year average tax rate has been around25Yo. Finance Director Yang shared the 2024 tax rates for cities in Ramsey County. The 2025 preliminary levies have not been published yet. She will share them as soon as they are available. In2024 Arden Hills was the lowest. Councilmember Holden said that doesn't mean anything to her because some of the cities have community centers, some have major streetlights and their own police departments. She thinks this slide doesn't show why surrounding communities are higher. It can't capture why they are higher. It's more important to know Arden Hills' history. Discussion ensued regarding how difficult it is to compare cities against each other. Finance Director Yang shared the proposed levy for 2025 is 15.5%. This includes $5.5 million to the General Fund and $610,000 to the CIP Funds. Councilmember Holden stated this still doesn't include the union negotiations with Public Works or any increases that may occur with the fire department. There are expenditure items missing. ARDEN HILLS CITY COTINCIL WORK SESSION _ NOVEMBER 12,2024 Mayor Grant said we aren't missing them. We just don't have final numbers yet because they aren't available. Finance Director Yang showed other funds relying on tax levy dollars. The EDA was $0 or a decrease of $110,000 over 2024. The Public Safety Fund is set to $260,000. This includes the base ler,y of $220,000 and the $40,000 city share for the Fire Captains. The Equipment/Building Replacement Fund is $210,000 or a tax levy increase of $110,000. The PIR Fund is set at $250,000 with the new Local Government Aid directed here also. Councilmember Monson said the EDA was set to $0 to help lower the levy when we initially looked at budget numbers. There was a project that was deferred. She said for the Equipment/Building Replacement Fund has $100,000 proposed in a previous slide. She wondered how we got to $210,000. Finance Director Yang confirmed and said it may be a typo on this slide. She will correct it. Councilmember Rousseau asked about the EDA Fund. She recalls Mayor Grant discussing $400,000 in a fund that was Economic Development Commission. She wondered if the EDA could use those funds if they came up with a plan. Mayor Grant said it was the EDA fund. He believes money was left over in Cottage Villas. Councilmember Holden said it can only be used for affordable housing. She thought it was $387,000. Councilmember Rousseau asked that if it's for affordable housing, could it be used at Rice Creek Commons. Councilmember Holden said hopefully we could save it for the rest of the city since the County is going to pay for the affordable housing there. Councilmember Rousseau asked if it could be used for improvements on affordable housing. Mayor Grant said there were specific rules that were published at the time that may have changed. We can look into that. It has to connect to affordable housing in some way. Councilmember Fabel asked what the balance of the fund is. Mayor Grant didn't have the exact amount. He believes that if you dedicated it to affordable housing, you got to keep a certain percentage. If it wasn't, the percentage was lower. Council at the time decided to take the higher percentage and dedicate it to affordable housing. Councilmember Monson had a question regarding the bench hand out. The last time Council saw the table there was 15.5% but the underfunded levy cost was approximately $200,000. Now we see in order to balance the budget we're still at 155% but the $200,000 is not there. Finance Director Yang said that is sitting in Net Changes in Other General Fund Budget Areas at $ 1 18,310. That includes revenue shortfall as well as other General Fund budget items. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 12,2024 Councilmember Monson asked for clarification that we no longer have an underfunded levy. She asked if there is $ I 1 8,000 that will be in the positive. Finance Director Yang said the S 1 18,000 includes the $ 192,000 underfunded amount at the time of the September 23 meeting. It's logistics of where she put it. We still need the levy to be $823,281 in order to balance the lely. Councilmember Monson asked if there is a reason the money was moved. Finance Director Yang it shows how the math comes together. It differentiates between total General Fund costs and any ler,y costs that are left underfunded. Councilmember Monson summarized there is no underfunded ler,y cost. Finance Director Yang confirmed. Finance Director Yang said union negations are still ongoing and that could impact the overall levy. She asked ifCouncil had any feedback or any changes that are needed. Mayor Grant said that discussion could take longer than the few minutes left in the work session. He said the City Council meeting should be short. He asked if Council would be okay to adjoum and come back after the regular City Council meeting. Councilmember Holden said she thought Council decided not to do that because when the topic was TCAAP, Council thought it would be too late in the evening. Mayor Grant said the Council meeting will be short. He thought we could set some parameters. Councilmember Rousseau said that everything on the Council meeting is a consent item. There are no public hearings or other items that will have a lot of discussion. Council recessed the work session at 6:52 pm. Council reconvened the work session at7:28 pm Mayor Grant reminded council of where they left off. The question on the table is, What lely decrease, if any, would Council like to consider for the Truth in Taxation (llNT) meeting? Councilmember Monson thought previous years they were given multiple choices at the TNT meeting. She asked for a reminder of how it works. Finance Director Yang said as part of the memo there are a few scenarios. Councilmember Monson wondered if they would all be shown at the TNT meeting. Finance Director Yang said she can. Councilmember Holden said the budget has been earmarked but does not update on several items. She is concerned about the four trail projects coming up. The Master Park Plan doesn't make sense because she would rather pay for the trails now and put the Master Park Plan out a t0 ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 12,2024 year or two. She thinks we are dumping everything in one year, in addition to all the salary increases. Everybody understands that the increases have to hit because everyone is getting a large increase. Councilmember Rousseau disagreed. She said we had started to go down a path of strategic planning so we could look at doing a vision over the next several years. She has heard Councilmember Holden say everyone is looking for a Cadillac. She thinks that's a generational difference. Families she knows have hatchbacks and mini-vans. She thinks the Master Park Plan is the first step in investing in our parks in a way that we can maintain. We need to do some significant planning and start to put processes to discuss funding. No one is looking for a $4 million park. Her 4-year old was bored with the equipment at Cummings after the park improvement project. She thinks it's important to put some things in place so all the residents can enjoy the park, not just the pickle-ballers. Councilmember Monson asked if we were to cut the Parks Master Plan out of the PIR Fund, would that change the levy? Finance Director Yang said no. Councilmember Monson asked why removing the Master Parks Plan would not change the levy this year. Finance Director Yang said the levy is set at $250,000. That gets incorporated into the overall fund balance. You have to consider revenues, as well as expenditures and how that would change the fund balance over time. If we were to remove the $75,000 from the CIP fund, it will just adjust the fund balance up by $75,000. Councilmember Holden asked how money gets into the PIR Fund. Finance Director Yang said lely and other revenue sources. Councilmember Holden said it would be less money we would have to take from the General Fund and put in the PIR. So it's all the same money, regardless of where it goes. She is insulted by Councilmember Rousseau saying it's a generational thing. It always comes back to age here. This isn't generational. She has a lot of residents with little kids on her street and she talks to them. There was a similar comment last time regarding meetings lasting until 9:00 gets to be too late for folks who work. Those types of statements need to stop. This is the way she views it, it may be a different way of looking at it. She said kids being bored at a park is normal. Kids get bored if they go to the same park over and over. She wanted to know how we will pay for the trails. There is $4 million going towards trails. Residents want trails. Residents want parks. We can change the maintenance schedule on the parks. We can add things to them now. But it takes planning. Part of that is not just jumping in and hiring someone before we even know how we're going to pay for things that are already in the Parks Plan that we need to finish, which includes the four trails. Mayor Grant said it includes five trails. Councilmember Holden said the fifth trail isn't being paid for by City dollars. 1l ARDEN HILLS CITY COUNCIL WORK SESSION _ NOVEMBER 12,2024 Mayor Grant agreed, but said it is still in the Parks Plan that the City of Arden Hills will connect to the City of Roseville through that route. Councilmember Holden said additional trails were put in the Parks Plan in the City that weren't in the Parks Plan before. Mayor Grant understands the need for Parks Plan. He doesn't know if he supports it being in this year's budget, based on where the budget is going and based on the fact that we have a lot to pay for. We should use that money for building trails. It would be a benefit to residents. He agrees it isn't a generational thing. Councilmember Monson said Finance Director Yang presented a $785,000 total increase in CIP Fund balance. Most of these trails are in 2026. She thinks spending $75,000 for a Parks Master Plan does very little to touch the dollars that won't happen in2026. She wondered if Councilmember Holden is asking to increase the levy so we have the money in2026. Councilmember Holden said increasing the lely next year to pay for a Parks Master Plan could save $100,000 to move forward next year. Councilmember Monson asked for clarification that Councilmember Holden wants to save $75,000 for 2025 and then put that $75,000 in2026. Councilmember Holden confirmed. She said there won't be the significant increase next year, as we have this year. Councilmember Monson doesn't know if that is true. We don't know what will come through. Councilmember Holden said we know the significant increase in all the salaries, that large bump, won't happen. Councilmember Monson would agree that we don't have to anticipate a personnel increase where we are making up 6 years. Mayor Grant asked if there were still items left to be done in the 2002 Parks Plan. Public Works Director/City Engineer Swearingen confirmed. Those items haven't been programmed into the CIP. Mayor Grant said we have a plan to improve the parks and trails. It's not fully implemented or fully programmed but there is a plan. Public Works Director/City Engineer Swearingen confirmed. There are items within the2002 Plan that could be pulled. The question is if it needs to be updated. Mayor Grant said there is a plan with the ideas that is still serviceable for a couple more years. Even the plan itself, as presented in 2002, was projected to be a 20-year plan. Public Works Director/City Engineer Swearingen confirmed. The plan was to be updated after a minimum of 10 years which didn't happen. He said park improvement projects are the most t2 ARDEN HILLS CITY COTINCIL WORK SESSION _ NOVEMBER 12,2024 criticized projects the City does. Staff carries the burden when there is no solid plan to rely on. He sees a benefit to completing a Parks Master Plan. Mayor Grant objected to the word "criticized". Public Works Director/City Engineer Swearingen said if we do one thing, Staff is criticized for doing it that way. Questions are why we didn't do it a different way. If we plant the wrong tree in the wrong location, we are criticized. We can do understory rehab and be criticized. We need a solid plan to follow so Staff isn't bearing that burden. Councilmember Rousseau is in favor of doing the Parks Master Plan this year. When she shares that her child was bored, it's not just her child. There are a number of her neighbors who said their kids don't want to play at these parks anymore. She may ride bikes to Wilson in Shoreview because they can't get across the freeways to get to the other parks. If we wait until 2026 to complete the Parks Master Plan, when are we going to budget resources to execute it? Will it be in2027 when we're paying for the trails? She apologized about the Cadillac comment. Councilmember Fabel was not offended by the Cadillac comment. He has 4 children and 5 grand children who like to use the parks. He supports keeping the Parks Master Plan in this year. Councilmember Monson outlined what Staff needs. She said 15.5% will balance. She wondered what it would look like to remove the $75,000 for the Parks Plan. She is fine with the 15.5% and 13% would put us under by $132,000. She asked how much underfunded the 12.55olo was last year. Finance Director Yang said S182,000. Councilmember Monson asked if that was the number when it was voted on it. She thought it was closer to $130,000. She didn't know if there is a threshold point for other Councilmember who are willing to underfund the budget. She would be fine with 15.5%o and showing l3%. She said if someone else has a percentage that reflects a dollar amount that will be made up in the budget during the year, either from not spending anything or from extra revenue coming in, she would like to hear it, so we know what percentages to talk about at the Truth and Taxation. Councilmember Holden said we already know it's not going to be 15.5% without under budgeting. Last year we did $182,000, but we are meeting budget this year. Additional costs will have to go into this. It's already under budgeted at 15.5o/o. Councilmember Monson said that's our maximum. So we can't do anything about that, anyway. Councilmember Holden confirmed. She said she doesn't believe Councilmember Monson wants to hear what anyone else says. Everyone is going to have their own opinion and it's a waste to argue about stuff. Mayor Grant said we have shown that, traditionally, our expenditures are not as high as we anticipate and we tend to come in on budget. We can under fund by a certain percentage. There is a risk we'll come out a little below. He would rather do that than fully fund and end up with an excess ofrevenue. 13 ARDEN HILLS CITY COLINCIL WORK SESSION - NOVEMBER 12,2024 l4 Councilmember Monson doesn't think it's fair for Councilmember Holden to say she doesn't care what other people are saying. She worked really hard to get the levy down fromthe 20Yo. She is all ears. She strongly believes it should not be arbitrary. If anyone has math behind any preferred levy, she is all ears. She said underfunded levy costs were moved into the net changes and other general fund, does that reflect that we will not be underbudget? Finance Director Yang confirmed. At the September 23 meeting we had said, in order to have a balanced budget, we would need to add an additional 5192,000, or 15.5o/o. We have a balanced budget. Councilmember Monson asked if there is a deficit from2024 that needs to be made up in 2025. Finance Director Yang said there is not. Councilmember Holden said if we add in the additional union costs and the fire department costs, what are we giving up, for next year? Councilmember Fabel said he hears Councilmember Holden speaking in favor of a balanced budget. He favors that. He does not like deficit spending. He asked what the actual deficit is for 2024. Finance Director Yang said we are projected to be on budget. That means we would be at a $182,000 deficit. Mayor Grant clarified that coming in on budget is a couple thousand, one way or another. Finance Director Yang said it is $1,800. The2024 budget had a deficit of $182,000. Councilmember Fabel understands that. He wants to know if we are fully funding our expenses for 2024. Finance Director Yang said we have not because there is a deficit in the budget. We are projecting that we will be at budget, which is a deficit of $182,000. Mayor Grant said we deficit the budget S182,000 yet this year, we'll come in at $2,000 to budget. That means somehow, over the course of the year, we have spent $182,000 less or there was an offsetting revenue. Finance Director Yang clarified that for the 2024 budget, we had set the budget with a $ 182,000 deficit. That means expenditures exceed revenues by that amount. She is projecting that for 2024, we will be at a deficit of $ 183,000. That means we are close to being on budget with that deficit. Mayor Grant said we lowered the levy by S182,000 last year. When we are done this year, we are going to be on budget. Councilmember Holden said the question is did we spend an additional $182,000 in expenditures where we don't have revenue. Finance Director Yang confirmed. ARDEN HILLS CITY COTINCIL WORK SESSION _ NOVEMBER 12,2024 Councilmember Monson asked where the $182,000 fits into the2025 budget. Finance Director Yang said that is a year over year change. We do it as a comparison to see where we are year over year, in terms of a levy increase. When we look at2025 budget, we are looking at total revenues over total expenditures. Whatever revenues come short of those expenditures is considered underfunded. Councilmember Monson asked if we assume there are no updates, the 15.5Yo lely will have us at $0, but we'll have a $182,000 deficit that will carry over fuom2024. Finance Director Yang confirmed. Councilmember Monson said if we wanted to cover that $182,000, we would have raise the levy more than 155% or have more revenue than we anticipate come in in 2025. We can't raise the levy and we aren't expecting additional revenue so we would have to cut $ I 82,000 out of this budget. Finance Director Yang said if we had budgeted a deficit of $ I 82,000 and we meet that budget, we would say we are going to be on budget. We are anticipating that we are going to be in a S183,000 deficit position. That hits the fund balance. That reduces our overall General Fund balance, which is essentially our retained earnings or reserves. Councilmember Monson asked if we are taking money from the future by not funding that. Finance Director Yang confirmed, you can think of it in that sense. Councilmember Monson this level of detail makes things look worse than she thought. She is okay with l5.5oh and l3Yo. Does anyone else has a different percentage they would like to show at the Truth in Taxation. l5 Councilmember Fabel thinks expenses over and above what other expenses. Mayor Grant said we'll know consideration at that time. we should present the 15.5% knowing that we are going to have we have previously budgeted; to include union negotiations and that before the Truth in Taxation hearing. We'll take that into C. 2025 Fee Schedule Discussion Mayor Grant doesn't have any problem with the proposed Fee Schedule. He asked if there is anything Council would like to discuss. Councilmember Holden asked when the cannabis fees will be added. Assistant to the City Administrator/City Clerk Hanson said she will have a draft for the registrations, to include what can be charged for a City fee. That is governed in State Statute. That will be brought to the meeting on November 25. ARDEN HILLS CITY COI.INCIL WORK SESSION - NOVEMBER 12,2024 Councilmember Rousseau has some questions about the dog and cat licenses. She thinks surrounding communities are going away from that with the option to microchip pets. Assistant to the City Administrator/City Clerk Hanson said currently we have 28 cat licenses and 93 dog licenses. Mayor Grant asked if Councilmember Rousseau has an issue with the proposed fee for 2025. Councilmember Rousseau wondered if it is necessary. It seems like a low number of licenses. She would like to discuss it. Councilmember Holden asked how much we pay for the Animal Control Officer. Interim City Administrator Jagoe said that is broken out with the Ramsey County Sheriffs Office. She could bring that number back to a later discussion. Councilmember Holden said if we don't fund that through licensing, we're in the deficit even more. Mayor Grant takes his dogs to a lot of parks. There are parks in some cities that are posted that you need to have a license, or you aren't allowed to take your dog to the park. There are cities that require it. Councilmember Rousseau asked about the cat licenses. There are more than 28 cats in our city. She just wonders if the ordinance is even applicable. The kennel license is another fee she is questioning. She thinks Boston Scientific does animal testing. Assistant to the City Administrator/City Clerk Hanson said we license the business, as a whole. We don't license the individual components of their business. Councilmember Rousseau asked if a PetCo came to the city, would they need a kennel license. Assistant to the City Administrator/City Clerk Hanson said we have two types of kennel licenses. They have generally been for residential use. Interim City Administrator Jagoe said if a business like PetCo or if someone wanted to do overnight boarding, we would look at the definition of land use and zoning code for a kennel. Councilmember Holden said there was a situation where l6 dogs were not being cared for and they just barked all the time. In situations like that, we can revoke the license and make them remove the dogs. Councilmember Rousseau thinks we should keep the kennel license. She was just seeking a little more information on what the definition of a kennel is. She's also curious to know about the community gardens. She wondered how many licenses we have done for that. Assistant to the City Administrator/City Clerk Hanson said there are l5 total plots available and they fill up every year. t6 ARDEN HILLS CITY COI.TNCIL WORK SESSION - NOVEMBEP. 12,2024 Councilmember Rousseau asked about the food truck fee. She wondered if that was accurate. Assistant to the City Administrator/City Cterk Hanson said that is an error and will be fixed. Councilmember Rousseau would like to discuss the dog and cat licensing further to determine if it's still appropriate. Councilmember Fabel said there is a recycling fee of $60. He asked if that was a quarterly or annual fee. He asked how we get away with that. We don't generate revenue sufficient to cover recycling. Mayor Grant said we also get an annual grant from Ramsey County. Assistant to the City Administrator/City Clerk Hanson said Councilmember Rousseau had asked about car washes. Surrounding communities don't require a business license for car washes. It is a CUP. If the council wants to require business licenses for car washes, we can create a category or maybe fitting it in under an existing category. Discussion ensued regarding how many businesses have a car wash component to their business. Mayor Grant asked when the Fee Schedule will be brought back. Assistant to the City Administrator/City Clerk Hanson said another version, which includes adult use cannabis registrations, will be brought to the next meeting. The final approval will probably be at the first meeting in December. Mayor Grant asked if this would come back to another work session. Assistant to the City Administrator/City Clerk Hanson confirmed. Related to the adult use cannabis registration. Mayor Grant asked if Council could discuss cats and dogs at that meeting. Assistant to the City Administrator/City Clerk Hanson confirmed. Mayor Grant asked if Staff could survey surrounding communities and see what everyone else does for pet licenses. He asked if this is a two-year license and what the schedule is. Assistant to the City Administrator/City Clerk Hanson confirmed it is two-years. Everyone is on the same schedule. If they apply mid-way the fee is prorated to include just one year. We are in a new two-year cycle, beginning January 1,2025. Mayor Grant requested additional information be brought back to Council. D. Rice Creek Commons/TCAAP Discussion This item was not discussed. t7 ARDEN HILLS CITY COUNCIL WORK SESSION _ NOVEMBER 12,2024 18 E. Agenda Planning This item was not discussed. 4. COUNCIL COMMENTS AND STAFF UPDATES ADJOURN Mayor Grant adjourned the City Council Work Session at 8:10 p.m. Jenrlifer Estling