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HomeMy WebLinkAboutSpecial City Council Minutes 05.19.2004MINUTES OF THE CITY COUNCIL oF LAUREL May19,2004 A special meeting of the City Council of the City of Laurel, Montana, was held in the Council Chambers and called to order by Mayor Ken Olson at 5:30 p.m. on May 19, 2004. COUNCIL MEMBERS PRESENT: Dick Fritzler Kate Stevenson Gay Easton Jennifer Johnson Mark Mace John Oakes COUNCIL MEMBERS ABSENT: Doug PoeMs Dan Dart DEPARTMENT HEADS PRESENT: Mary Embleton Peg Amold Terry Ruff Jean Kerr Larry McCann Jan Faught Rick Musson OTHERS PRESENT: Nathan Tubergen Jim Yellowtail Scott Wilm Mayor Olson led the Pledge of Allegiance to the American flag. PUBLIC INPUT: None. PRESENTATION OF THE 2004-2005 PROPOSED BUDGET: Nathan Tubergen's transmittal letter for the Proposed Budget for Fiscal Year 2004-2005, the 2004- 2005 Proposed Budget, and the Preliminary Budget Summary were distributed to the council. Department heads received a copy of the transmittal letter. A copy of the transmittal letter and the Preliminary Budget Summary are attached to these council minutes as a part of the record. Mayor Olson expressed his appreciation to the department heads for allowing Nathan Tubergen to review the budgets with them. He stated that the cooperation was very instrumental in preparation of the documentation and projects that will be presented tonight. Nathan Tubergen thanked the department heads for their assistance in the budget process. He also thanked Mary Embleton and her staff for their help and support. Nathan reviewed the transmittal letter at this meeting, and he asked the council to take time to review the budget book. The transmittal letter provided an explanation of the following funds: General Fund; Comp Insurance, Health Insurance, and Public Employees' Retirement Fund; Planning Department; Local Govemmant Study Commission; City Parking Fund; Lighting Districts 2 and 3; Street Maintenance District; Memorial Endowment Pool; Gas Tax Fund; 911 and E-911 Funds; HOME Grant; Debt Service; Capital Projects Fund; Water Fund; Sewer Fund; Solid Waste Fund; and Trust and Agency Fund. General Fund Salaries and fringe benefits comprise approximately eighty to ninety percent (80 to 90%) of the General Fund. The proposed budget includes a three percent (3%) wage increase that was previously negotiated and approved by council. Since the health insurance premiums are unknown at this time, the maximum dollar amount has been budgeted. Approximately $200,000 will be used out of cash reserves next year for operation and maintenance expenses. Nathan explained cash reserves, which are generated when more income is received than is expended during the fiscal year. Mayor Olson mentioned the cookie jar explanation that Ken Weaver uses. Cash reserves are what are left over to start business at the beginning of the next year. In order for the city to start business Council Minutes of May 19, 2004 this year, we had to take something out of the cookie jar before we even had a chance to start our business next year. Nathan stated that the General Fund is mostly people. In order to generate more money into reserves in the General Fund, expenses have to be cnt. Doing that would require having fewer employees. About fifty percent (50%) of the General Fund is usually for public safety in the police, fire, and ambulance departments, and that is the last place you want to make cuts. In order to increase reserves, more revenue has to be received. Street Maintenance District The revenues and expenditures for this department are almost equal. We have incorporated the current ½-cent per square foot to the proposed two cents per square foot into the proposed budget. That gives the capability of capital outlay money of $335,303 that can be used for a major project from East Fimt Street to Wyoming Avenue, including street, curb, gutter, sidewalk, water, and sewer. The portion for the street is $980,000 for street, curb, and gutter, and the sidewalk would cost about $259,000. Nathan has already worked out a loan with the State; if it is approved, the city can move forward with that project. Nathan estimates that the project will probably get started in March, as a lot of engineering is required. Nathan considered how to do a small street project this year. If citizens do not see progress this year, they will probably complain when they see it on their tax bill in November. Nathan contacted the State regarding a loan. The City of Laurel can get a loan for $980,000 for this project. He suggested that the city could borrow the money for this project and then replenish it with the money that is collected in December. Residents will see that progress has been made by the time they receive their next real estate tax statement. The $980,000 would provide the means to do the project in 2005 and then also accumulate dollars. The May and December collections in 2005 could be put in the 2006 budget. Doing the loan now would enable the city to fund street projects for three years and show progress at the same time. Nathan received verbal approval from the State at good interest rates. The State of Montana recognizes that Laurel has some major problems with infrastructure. Nathan may be able to get a 23A percent interest rate and the highest would be four percent (4%). Gas Tax Fund Nathan expressed concern about this fund. As the gas prices rise, people are going to find different methods to get things done so they do not have to drive as much. As gas consumption goes down, revenues in the Gas Tax Fund will also decrease. The city is only allowed to pay twenty-five pement (25%) of the budget for capital, and the loan for the asphalt recycler is almost twenty-five pement (25%). The price of gas will have an impact on city departments and street projects. 911 and E-911 Funds The 911 Fund is used for dispatcher.equipment, and the E-911 Fund will be used to provide caller ID capability. The State will hold the funds until the city's plan is review and approved. HOME Grant HOME Grant revenues are $250,000 and expenditures are $310,000, leaving $60,000 for the city's contribution. The $60,000 is not included in the budget. Direct contribution and in kind match are the two sources that can be used for the city's share. The City of Laurel is asking the State to review the funding. Water Fund There was discussion regarding the Water Fund reserves. Revenues for the Water Fund include the six percent rate increase previously approved by the city council. $310,000 of the capital outlay is to be transferred to the Capital Improvement Program for the Water Fund's share of the major project. Approximately thirty percent (30%) of revenues goes toward debt service. Sewer Fund We are requesting the city council to consider approval of a six percent (6%) rate increase to go into effect in January 2005. The rate increase would help provide the funding needs for the operation, maintenance, and capital needs Of the sewer system. Solid Waste Fund We are recommending adjusting the charges for commemial users in order to reflect the actual usage by each business in the commercial district. The proposal is for a twenty percent (20%) increase for businesses that have one container and a twenty-five pement (25%) increase for businesses with two Council Minutes of May 19, 2004 or more containers. Charges will be based on usage. Nathan recommended that staff members contact the business owners individually regarding the proposed adjustment. Nathan presented a recap of the major capital equipment requests and projects that are proposed in the budget. (See attached transmittal letter.) Nathan summarized the proposed increases in rates and charges for Light Districts 2 and 3, the Street Maintenance District, the six pement (6%) water rate increase, the six pement (6%) sewer rate increase, and the possible slight adjustment to the mill levy once the mill value is received from the Department of Revenue. Mayor Olson asked Mary Embleton to explain the format of the budget books to the council. Nathan Tubergen will attend the Council Workshop on May 25th to answer any questions regarding the proposed budget. ADJOURNMENT: Motion by Alderman Mace to adjourn thc council meeting, seconded by Alderman Oakes. Motion carried 6-0. There being no further business to come before thc council at this time, the meeting was adjourned at 6:51 p.m. Cindy Allen, S0~retary Approved by the Mayor and passed by the City Council of the City of Laurel, Montana, this 1st day of June, 2004. //I~n~neth E. Olson, Jr.,~or Attest: Mary K. F~fnbleton, Clerk-Treasurer 3 CITY HALL IISW. IST ST. PUB WORKS: 628-4796 WATER OFC: 628-7431 COURT: 628-1964 FAX: 628-2241 ity Of Laurel P.O. Box 10 Laurel, Montana 59044 DEPARTMENT To: Honorable Mayor and Laurel City Council Members Kenneth E. Olson, Mayor From: Nathan R. Tubergen, Administrative Assistants/C.P.C./~ Date: May 19, 2004 Subject: Transmittal Letter for the Proposed Budget for Fiscal Year 2004-2005 On behalf of the mayor and me, we would like to thank all the department heads for their help in the preparation of the 2004-2005 proposed budget. Special thanks go to Clerk-Treasurer Mary K. Embleton and her staff for putting this document together with me. During the budget process, each of the department heads met with the Budget/Finance Committee during the months of March and April to present their budget requests. I would like to provide you with an overview of the proposed budget for fiscal year 2004-2005. The proposed budget includes increases of three percent (3%) in salary and wages. The health insurance budget is at maximum per employee, based on the fact that we have not yet received the new premiums for the next year. The budget also provides normal increases for operation and maintenance expenses. I have also included a recap of all the rates and charges that have been included in the budget, along with the capital outlay request. GENERAL FUND The General Fund revenues are $2,572,329 and the expenditures are $2,905,719. The capital expense for the General Fund is $133,569. We are using $333,390 from General Fund reserves in order in balance the budget. We have a change between the city attorney budget and the court budget with the approval of the new contract with the city attorneys. All secretarial service charges are in their budget; therefore, we have transferred the hours to the city court budget based on the workload. Budget/NathanTubergenLetter Cily Of Laurel is an EEO Employer Equal Housing Opportunity SPECIAL REVENUE FUNDS COMP INSURANCE~ HEALTH INSURANCE~ AND PUBLIC EMPLOYEES' RETIREMENT FUND The comp insurance, health insurance and the public employees' retirement funds are used to pay a portion of the General Fund employer's share through the mill levy. PLANNING DEPARTMENT The planning budget has not included any new projects for this fiscal year. The budget does contain the anticipated balance, as of June 30th, for the f'mal phase of the Growth Management Plan. LOCAL GOVERNMENT STUDY COMMISSION We have budgeted funds for a local government study commission, if approved by the voters. CITY PARKING FUND We have $9,000 in the budget for replacement of parking stops and resign the city parking lot located across from city hall. LIGHTING DISTRICTS 2 AND 3 We have an increase in the lighting districts to reflect the increased cost to the City of Laurel from NorthWestern Energy Company. This is a pass through cost over which we have no control. STREET MAINTENANCE DISTRICT The revenues for the street department are $1,499,156, with the expenditures at $1,498,316. The revenue includes an increase in the street maintenance district levy from one-half cent to two cents per square foot. This will provide $335,303 for the loan repayment for East First Street to Wyoming Street and also for other capital projects, i.e., overlays, replacement for street, curb and gutter projects. These will be identified and brought forward for approval by the city council as the funding becomes available. The funds are received in December and June of each year through the tax billing process. MEMORIAL ENDOWMENT POOL We have added funding in the budget this year for a joint study with the Laurel School District for a new swimming pool. The funding is coming from the interest received on the donation. BudgefflqathanTubergenLetter GAS TAX FUND The revenues for the Gas Tax Fund are $131,000, with the expenditures at $142,730. The budget includes the annual repayment of the loan to the State of Montana for the asphalt recycler. 911 AND E-911 FUNDS The 911 Fund is for the dispatcher equipment. The E-911 Fund will be used to provide the city with caller I.D. capability. The funds are held at the State until the City of Laurel has drafted a plan for the State to review. The police chief has presented a plan to the State for their approval, with an estimated cost of $90,000 for the project. HOME GRANT The revenue for this fund is $250,000 and the expenditures are $310,000, leaving a balance of $60,000 for the city's share. We do not have the $60,000 in the budget. The mayor is working to see if the city's requirement can be reduced. The two sources that I know we can use are in kind match or direct contribution for the General Fund. DEBT SERVICE The Debt Service Fund provides for the annual repayment of the special improvement district bond issue outstanding. CAPITAL PROJECTS FUND This includes the major construction project for the water, sewer, street, and sidewalk funds. If the council approves the sidewalk project, we will need to create a sidewalk special improvement district with the approval of the property owners before we can go ahead with a revenue bond issue. We also have a replacement vehicle for the police department. Also added in is $10,000 for the future purchase of an ambulance, which was previously approved by the city council WATER FUND The total revenues for the Water Fund are $2,002,700, which includes the six percent (6%) rate increase previously approved by the city council. The expenditures for the fund are $2,537,683, with the capital outlay at $663,000. In the capital outlay, $310,000 is to be transferred to the Capital Improvement Program for the water fund's share of the major project. Also, I would be remiss ifI did not state that this fund has an annual debt service payment of $648,916. SEWER FUND The total revenues for the Sewer Fund are $2,297,200, and the expenditures are $2,371,179. The capital outlay is $1,353,000, which will be funded through TSEP and DNRC Grants and a loan B udget/NathanTubergenLetter from the State of Montana. We are requesting the city council to consider approval of a six percent (6%) rate increase to take effect in January 2005. The rate increase will help provide the funding needs for the operation, maintenance, and capital needs of the City of Laurel's sewer system. Upon completion of the needs study, the staff will bring it forward for the city council's review and consideration for future rate increases. SOLID WASTE FUND The revenues for the Solid Waste Fund are $536,516, and the expenditures are $645,873. We are adjusting the charges for commercial businesses to reflect the actual usage by each customer in the commercial district. It will take several years to bring them up to where their charges should be; the city should have made the correction in the past. We are looking at a twenty percent (20%) increase for businesses that have one container and a twenty-five percent (25%) increase for businesses that have two or more containers. Again, this is not a rate increase, but charges will be based on usage. TRUSTANDAGENCYFUND These funds are used to collect monies in the court system and to make payment to the State of Montana, as required by State law. Funds are also collected and payment is made to the Firemen's Relief Association. Budget/NathanTubergenLetter The follow is a recap of the major capital equipment requests and projects that are proposed in the budget: · Safety program · Police vehicle · Remodeling of city hall · City parking lot · Insulation of building · Swimming pool study · Cemetery study · E-911 caller I.D. capability · First Avenue and 12t~ Street water line replacement · East First Street to Wyoming Street replaces water and sewer lines, street, curb, gutter and sidewalks with a sidewalk special improvement districts. · Sewer phase 2 · Refuse roll offtruck The following are the increases in the rates and charges: · Light District 2: based on an 8,400 square foot lot - will increase from $12.60 to $15.75 per year. · Light District 3: based on a 4,600 square foot lot - will increase from $28.80 to $41.80 per year · Street Maintenance District: increase from one-half cent to two cents per square foot · Water rate increase: 6% per cent increase · Sewer rate increase: 6% per cent increase · There may be a slight adjustment to the mill levy, once we receive the mill value from the State Department of Revenue. B udgeffNathanTubergenLetter