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Regular City Council Minutes - 2/24/03 Page 8 and staff hirings. Mayor Kysylyczyn sought clarification from City Attorney Scott Anderson regarding the Council's legislative abilities in revising the terms of the contract, thus sending management back to the negotiating table with union representatives. City Attorney Anderson confirmed that Councilmembers had that ability through their vote for the motion currently on the table. Councilmember Klausing, while supportive and sympathetic to city employees, their contributions in keeping the service level expected by residents, and the suggested salary increases, expressed concern in approving the reconullended percentage increases given the state's, and ultimately the City's, revenue situation. Councilmember Klausing sought City Manager Beets' impression of Council concerns and the potential need for renegotiation. City Manager Beets recognized and concurred with Council concerns regarding the dynamic and changing budget environment while seeking approval of a two-year binding legal contract, which created risks for both parties, but offered a competitive environment for the City to retain employees. Mr. Beets advised that the net fiscal effect to the City for thirty (30) employees was approximately $30,000. Councilmember Schroeder clarified that the Stanton Survey is based on 2002 data; and the 2003 update is basically 2003 early information and doesn't reflect current turmoil faced by cities. Councilmember Schroeder advised that other cities are facing numerous challenges to reduce operating expenses by cutting wages and hours in an effort to not reduce employees. Councilmember Schroeder stated that while a three percent (3 %) increase is applicable for 2003, approving a four percent (4%) increase for 2004 sets parity for other employee