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s - • t�.. rlr, ,n_ �•�-0.�•..-• +� • .{� r. �4. }.� -tiT�'•�+-:�i�7N1Y��..{." W.�#.f -f.��Milr�••_... � December 22,2004 TO: Members of the Roseville City Council FROM: Amy Ihlan RE: Items for Presentation at Special CouncilMeeting December 27,2004 Minnesota law gives the city council ultimate responsibility for budgeting and spending public money. Our responsibility goes beyond setting the levy and voting on whether to accept or reject the city manager's proposed budget. As the League of Minnesota Cities Handbook for Elected Officials points out, it is also the council'sresponsibility to "insist on standards of budget enforcement"and make sure that our budget and related policies provide adequate and proper controls over the city's spending. As an essential part of our budget process, I ask the council to consider and approve the following policies to control city spending on professional consultants — especially economic development consultants. Reasons Whv Additional Controls Are Needed on Consultant S�ending L Community development/economic development department spending for professional services has been hugely over budget since 2003. Spending on professional services went from $21,924.44in 2002 to $127,663.91in 2003. The authorizedprofessional services budget line for 2004 is only $30,000 — but finance department estimates indicate that the city has already spent 5 times that amount on the Twin Lakes project alone in 2004. Clearly, economic development professional consulting expenditures are out of control, and it is the council's responsibility to do sometl�ing about it. 2. The council has a fiduciary duty to the taxpayers to spend public money only for proper public purposes. Council members mav be uersonallv liable for any unlawful expenditures they authorize. See "Public Purpose Expenditures: A Research Memo for City Officials," League of Minnesota Cities,November 2002, page 10. 3. Lawful expenditures of public money must ha�e a valid public purpose and be properly authorized by the city council. See "PublicPurpose Expenditures: A Research Memo for City Officials,"League of Minnesota Cities, November 2002, page 9. According to the Minnesota Supreme Court, an activity has a valid public purpose if it meets all of the following standards: The activity will benefit the community as a body. The activity is directly related to functions of government. The activity does not have as its primary objective the benefit of a private interest. "PublicPurpose Expenditures: A Research Memo for City Officials,"League of Minnesota Cities, November 2002, pages 9-10.