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Regular City Council Meeting Monday, September 9, 2013 Page 12 At the request of Councilmember Etten, Mr. Miller confirmed that the 2% COLA related to all City employees, including those under union contracts, some of which were already in place for 2014 with others still to be negotiated. At the request of Councilmember Etten whether it was possible to show union contracts to which the City was already bound, Mr. Miller advised that to his knowledge, only one (1) union contract had been approved for 2014 at this point, a status that was confirmed by Interim City Manager Trudgeon; with two (2) oth- ers yet to be approved but already in ongoing discussions. At the request of Councilmember Etten, Mr. Miller opined that the 2% COLA set aside in the proposed budget was consistent with other union settlements for 2014, as well as those of other cities. At the request of Mayor Roe, Mr. Miller advised that part of the negotiation pro- cess was the review of peer cities, clarifying that unions were already at 100% of average peer cities, so their main concern was inflationary increases; thus man- agement's rationale in advocating for 2% COLA for all employees to keep them from falling further behind union compensation and attempting equity without further disparities. At the request of Councilmember Etten, Mr. Miller confirmed that $400,000 was proposed to come from cash reserves toward the budget, as detailed in the RCA. In referencing an e-mail from Mr. Miller to the City Council, Councilmember Et- ten questioned the percentage rolled into the levy increase; with Mr. Miller advis- ing that recent public information provided by the State Department of Revenue several weeks ago somewhat changed the assumptions of available levy limits that the City had based their budget plans on, creating an increase. However, Mr. Miller noted that, to his knowledge, staff was not advocating that the levy or budget increase significantly to take advantage of that available levy amount; but were retaining the City Manager Recommended Budget as originally presented. Councilmember Etten stated that he was interested in the City Council, as a more honest way in his opinion to budget moving forward, moving some of that cash reserve amount to the levy, with additional levy or cash reserves in 2014, recog- nizing that this was not sustainable long-term, but providing a more open policy for transparent budgeting. Mayor Roe noted that projections from 2013 through 2020 (page 4 of the RCA— Proposed Tax Levy & Estimated Impact) indicated an assumption of a 3% in- crease in operating costs, or $787,282 levy increase and that would incorporate that$400,000 in reserves.