- DRAFT -
SUNFISH LAKE SPECIAL COUNCIL BUDGET STUDY MEETING
AUGUST 7, 2018
6:00 P.M. - ST. ANNE’S EPISCOPAL CHURCH
Acting Mayor: Mike Hovey
Councilmembers: Steve Bulach, and Daniel O’Leary
City Treasurer: Ann Lanoue
Attorney: Tim Kuntz
Engineer: Jeff Sandberg
City Clerk: Cathy Iago
Councilmember JoAnne Wahlstrom was absent.
1. CALL TO ORDER: Acting Mayor Hovey opened the meeting at 6:00 p.m. for the purpose of discussing the proposed 2019
City of Sunfish Lake Budget and Tax Levy.
2. DISCUSS CITY OF SUNFISH LAKE PROPOSED 2019 BUDGET: Acting Mayor Hovey asked Treasurer Lanoue to provide an overview of the proposed 2019 Budget and Tax Levy.
Treasurer Lanoue distributed the Budget Analysis document which showed the 2018 Actual Budget, the 2018 Budget to date, and the proposed 2019 budget. She also distributed the Taxable Market Value and Tax Capacity Comparison for 2018-2019. She stated that the preliminary Taxable Market Value shows an increase of 9.5 percent for residential property and the new construction amount pf $918,500. She stated the tax Capacity valuation shows an increase of 10.7 percent from 2018 and that the new construction amount of $918,500 would generate $11,308 in tax capacity. She advised that she would request direction from Council at this meeting so that she could prepare the preliminary 2019 Tax Levy and Budget for formal adoption by Council at the September meeting.
The Treasurer reviewed the 2019 Revenue estimates for 2019; Special Assessments $31,000; Special Bond Fund Levy $81,957 would be reduced to $81,585 with Acorn Drive removed. She explained that the Recycling grant funds may increase slightly
Treasurer Lanoue distributed information submitted by staff with budget requests 2019:
Building Inspector: 80% of the revenue from building permits to the Inspector plus all plan review fees; The City receives 20%
of the revenue.
Planner: No change proposed per his memorandum dated August 7, 2018. The 2019 Planners budget remains at $30,000.
City Attorney: Increase of $2,000 over 2018 ($34,000); per email the 2019 request is $36,000.
Police services: Proposed increase of 2 percent over 2018; per email from West St. Paul Finance Director
Fire Department: Estimated increase of 10.7%. The Fire Department has not had any formal numbers and are planning to construct the new Fire Station. Email from Mendota Heights Finance Director advises that they plan to issue bonds to fund the fire station. The current billing formula used by Mendota Heights is 7.44% for Sunfish Lake.
Forester: No increase requested.
City Clerk: Staff included a 3% salary increase for 2019.
The Treasurer noted that postage costs were reduced since she does not mail information to Council. She explained that the $90 was included for the Signal Light at Delaware Avenue and $600 for the Septic Reminder mailings sent by Dakota County. She reviewed the remaining expenditures and explained there were no substantial increases proposed.
Treasurer Lanoue explained that the Engineering costs are the largest portion of the budget. She stated that the Actual to-date Engineering cost is $24,216 through July, 2018 and that $25,000 was budgeted for the year. She commented that the full year estimate listed for 2018 is approximately $38,000.
Engineer Sandburg explained that former City Engineer Sterna appeared to have donated a lot of his time and that in his opinion, the City should be charged for the time in order to reflect the actual cost.
Councilmember O’Leary pointed out that over the last year a significant amount of the Engineer’s time was spent on the Charlton Road project.
Treasurer Lanoue explained that the Engineer’s billing statement does not identify where items should be charged and there may be some costs that should be charged to the Charlton Road project.
Engineer Sandberg advised that former City Engineer Sterna indicated that the engineering costs should be increased, however, he did not provide an exact amount for the increase. He pointed out that there may not be excessive costs for the remainder of the year, however, it appears that $25,000 for the year seems low.
Treasurer Lanoue suggested that she could meet with the Engineer to review the billing statements to have him explain where items should be charged and then the monthly billings could be more specific as to where the costs should be budgeted.
Engineer Sandberg agreed that he would meet with the Treasurer to review the bills and discuss how to submit statement in the future.
There was discussion regarding the amount the Engineering budget should be for 2019. Council concurred to set the 2019 cost for engineering services at $32,000.
Councilmember O’Leary asked if engineering work on the Charlton Road improvements would be billed to the project and the Treasurer responded yes.
Treasurer Lanoue explained that it the Tax Rate remains the same, the $60,000 increase would be reduced to $52,000.
The Treasurer stated the proposed 2019 Improvement Project budget is proposed at $117,000 which includes improvements to Zehnder Road, Angell Road (east) and Sunnyside Lane as listed in the CIP. She further advised that the Snowplowing Budget is estimated at $35,000 for 2019. She explained that she kept the $3,000 cost to Inver Grove Heights for the City’s portion of plowing 60th Street. She noted that no billing statements had been received for this service, however, she kept the funds available.
Engineer Sandberg stated that a portion of the $117,000 cost would be assessable if the projects move forward. He commented that if the Charlton Road project is ordered, it could begin in May 2019 and that the road may have to be graded one or two more times before that occurs. He suggested that the maintenance costs for Charlton Road be increased to $13,000 for 2019.
Treasurer Lanoue pointed out that the City Forester’s salary was not increased last year and that she included a 3% salary increase in 2019. She explained that she also included a 7.7% increase for the lease of St. Anne’s Church.
There was discussion regarding the possibility of researching other churches within the City to determine if the rental/lease costs could be decreased.
Treasurer Lanoue explained that no motion is required at this time and that the preliminary budget would be adopted by Council at their September meeting and certified to Dakota County. She advised that Council would conduct a public hearing in December and would adopt the final budget document at that time. She pointed out that Council has the ability to reduce the preliminary budget once it is adopted, however, they cannot increase the preliminary budget.
Treasurer Lanoue explained that with no change in the Tax Rate, the proposed budget for 2019 totals $541,693 which is an increase of 10% from the 2018 budget. She further explained that if the Tax Levy remains the same, it recues the tax rate 10% which would balance the budget for 2019.
There was discussion regarding the amount the City retains in reserve funds. Treasurer Lanoue explained that the City had $350,000 in short-term CD’s and $619,000 in savings. She noted that the average small cities retain in reserve funds if between $600,000 and $700,000 in order to maintain city operations over one year.
Councilmember O’Leary asked if the City should have more reserves for street projects.
Treasurer Lanoue explained that Council would have the authority to set up a fund for street maintenance rather than increase the amount of reserve funds.
In summary, Council concurred to increase the Engineer Budget to $32,000 as discussed, to include other minor changes discussed, and to keep the tax rate the same. Council directed the Treasurer to make the necessary corrections to the proposed 2019 budget for their review and adoption at the September meeting.
Council thanked the Treasurer for a wonderful job presenting the proposed budget.
Acting Mayor Hovey asked if there was any further discussion and, hearing no response, adjourned the meeting at 6:55 p.m.
Catherine Iago, City Clerk Mike Hovey, Acting-Mayor