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COMMITTEE OF THE WHOLE - MINUTES - 9/18/2003 COMMITTEE OF THE WHOLE – CITY OF MUSKEGO Approved MINUTES OF MEETING HELD SEPTEMBER 18, 2003 Mayor Slocomb called the meeting to order at 7:05 PM. Also present were Ald. Petfalski, Ald. Patterson, Ald. Buckmaster, Ald. Damaski, Ald. Salentine, Ald. Schroeder, and Ald. Madden, Finance Director Dawn Gunderson, several representatives from the AFSCME City Hall and Library Union, and those per attached list. All in attendance recited the Pledge of Allegiance. Mayor Slocomb noted the meeting was noticed in accordance with the Open Meeting Law. Mayor Slocomb stated the Committee of the Whole budget minutes would be approved at the last Budget Committee of the Whole meeting. Closed Session No. 1 – Mayor Slocomb read the Notice of Closed Session – Please take notice that following Unfinished Business, the Committee of the Whole will convene upon passage of the proper motion into closed session pursuant to: 19.85(1)(c) Wis. Stats., Considering employment, promotion, compensation or performance evaluation data of any public employee over which the governmental body has jurisdiction or exercises responsibility, more specifically the consideration of the elimination of specific positions. Action may be taken in closed session. The Committee of the Whole will then reconvene into open session to continue with agenda items. Closed Session No. 2 – Mayor Slocomb read the Notice of Closed Session – Please take notice that following “Continued Review of the 2004 Capital and Operating Budgets”, the Committee of the Whole will convene upon passage of the proper motion into closed session pursuant to: 19.85(1)(c) Wis. Stats., Considering employment, promotion, compensation or performance evaluation data of any public employee over which the governmental body has jurisdiction or exercises responsibility, more specifically the consideration of the elimination of specific positions. Action may be taken in closed session. The Committee of the Whole will then reconvene into open session to continue with agenda items. Unfinished Business 1. Continue review 2004 Capital Budget Finance Director Dawn Gunderson stated that there was nothing new to report since the discussions at the September 4 and September 11 meetings. During the discussion of the Operating Budget future implication on Operating Budget with Capital will be discussed. 2. Continue review of 2004 Operating Budget Finance Director Dawn Gunderson presented summary of changes between the 2003 Budget and the 2004 Proposed Budget. The goal of the Common Council is to keep the tax rate the same. The difference between Department Requested Budget and the levy to maintain the tax rate is $1,953,000.00. Between 2003 and 2004 expense increases occurred in the following areas: obligation for debt service, wages and benefits, contingency, program for High School athletic fields, first half of re-evaluation, and Attorney fees for labor union contracts. The following areas showed reductions in revenue sources: state shared revenue, transportation aid, use of fund balance, and interest income. Mayor Slocomb and Finance Director Gunderson reviewed 2004 Operating Budget presented on September 11, 2003 and made reductions in expenses in the following areas: road program, removed request for new positions and upgraded positions, moved some operating cost into special revenue funds, reduced several line item requests for various departments, elimination of all intern positions, restructure of debt issue for repayment back to Sewer Utility and removing the payment for the next three years and restructuring the debt at a lower interest rate, no longer funding computer replacement reserve fund, overtime amount for Public Works Department. Additional increases in funding sources were made for the following: projected higher revenue for several departments, transferred additional resources from cable fund into operating budget, and additional tax revenue from Water Utility. One-year programs expenditures were considered to see which ones could be funded with non-levy dollars. After further review by some departments additional reductions were made: quote from cleaning service, funds for intern program moved to conservation fund, moving of time allocated to sewer and water utilities from general operating budget, elimination of purchasing one new Police Department vehicle, closing of park bathrooms, removing life guards at Idle Park, and material supplies for the Library. The Fire Departments will be contacted to hold the line to last years budget. Additional funding sources were: increase in fee of Parks Department preparing baseball fields, increase in dog license fees, increase in GIS fees, and allocation of administrative time spend on Special Revenue Funds to the respective Fund. The City Committee of the Whole Page 2 Minutes of Meeting Held September 18, 2003 Continue review of 2004 Operating Budget will receive $731,626.00 in State shared revenue and expenditure restraint payments. In order to maintain the tax rate equal to 2003 the City is short $193,600.00. Discussion took place on Fire Department construction loans, landfill funds, stormwater management funds, and GASB 34. Finance Director Gunderson stated a twelve-cent or two percent rate increase would balance the proposed budget as now presented. This would be a six-cent increase on general operating and six- cents on debt service. A six-cent rate increase would let debt service increase and operating remain the same as 2003. Discussion continued on the use of porta potties at parks with high usage and at historical society site. Finance Director Gunderson presented worksheets projecting the future. Revenue and expenses were projected at a three percent increase per year. Debt service is an actual number; fund balance was committed at $150,000.00 for the next three years, cable fund transfers would hold the line, the debt is the actual debt the City is off setting CDA borrowing with TIF revenue, and actual is actual continued payment back to the City from Water Utility for prior years water. CDA income and expenses were discussed. Discussion continued on taxpayer requests to maintain the current tax rate and the effect of the State Bill on future taxes. Grass mowing was discussed with the potential of having Briggs & Straton test lawn mowers cutting grass at several of the City’s larger parks and also the program Menomonee Falls has with volunteer organizations. Ald. Scroeder asked what the cost is for leaf collection? The history of leaf collection was explained and why it is difficult to provide a cost. Ald. Petfalski requested the City review alternatives: elimination of the program, reduce the number of trips through the City, provide leaf bags for free to simplify leaf pick up. Discussion continued on doing program just around lake or continuing program as is for the next year. Ald. Schroeder expressed his concerns on continuing leaf collection but cutting back on expenses in the Fire and Police Departments. Concerns with leaf burning were expressed. Mayor Slocomb explained three options that are available: raise taxes to cover the $193,600.00, combination of tax increase and use of landfill funds for balance, and personnel positions within the City. Ald. Petfalski presented additional alternatives to cutting the tax budget: look at wage and benefit increases caused by 2004 being a leap year and take one day as an unpaid day off and close City Hall for that day or pull the extra expense from landfill. Another option is to have all employees pay ten percent co-pay for health insurance and having the ten percent split over the next three years (2004 - four percent, 2005 - three percent, and 2006 - three percent). Due to union contracts his suggestion is starting out with the non-representative employees in 2004. This would be a saving of $16,590.00 at four percent. Discussion continued on whether an increase in co-pay would work or not. Finance Director Gunderson is working with the current health insurance carrier to meet the dollar premium the City wants to work with. Ms. Schweitzer would like to see no pay increases rather than job cuts. Ms. Luell stated she felt the union would be willing to accept concession if the union saw concession being made by the non-representatives. Mr. Kuwitzky expressed concerns about job cuts and then looking at the amount of money that has been spent on old town hall. He also talked about insurance costs and co-payments. Mr. Kuwitzky expressed concern about not being able to add a police officer but yet the City is still spending money on old town hall. Mr. Sommers discussed service levels that the citizens want, for example pay phones and leaf collection. He stated citizens should know that the City has held the line but overall taxes will go up. Chief Johnson expressed that reducing debt level at expense of services is not the proper thing to do. He stated capital projects that were committed to in previous years people have to pay for. Chief Johnson felt a minimum debt increase of six cents is appropriate. Ald. Schroeder proposed that the City use approximately $300,000.00 to $350,000.00 of landfill money to pay debt levy. This would take care of debt levy and would also allow the City to take care of the $150,000.00 of operating that the City is short. Mayor Slocomb stated you have to take a look at ramifications of doing this and what it means for next year. Ald. Schroeder stated he felt the City had an acceptable number of City employees and reducing the staff would be detrimental to the City and citizens. He felt the City spent landfill money on niceties and realized there was a contract that controlled spending. Ald Schroeder wants Finance Director Gunderson to take a look at landfill money to see what can be done to free up operating so the City will not have to lay off employees that he felt the City would have to hire back in a year. All other impacts of doing this have to be understood. Committee of the Whole Page 3 Minutes of Meeting Held September 18, 2003 Continue review of 2004 Operating Budget Mayor Slocomb stated that landfill devalues property and therefore detracts from the value of a community, therefore to counter act the negative impact it was determined the best use of the funds would be long term improvements. Ald. Buckmaster would like to see a pie chart for educating taxpayers so people can see where their tax dollar goes. Library Director Holly Sanhuber spoke about providing some type of public relations information on service reductions. The City’s contribution to Library material has been cut in half, bring it back to 1996 purchasing levels. Clerk-Treasurer Jean Marenda asked a procedure question as what the action of the Aldermen will be when they come back into open session? Will decisions be made, what is the intent? Mayor Slocomb stated he felt closed session would be one half hour to one hour long. Clerk-Treasurer Marenda stated that including a pie chart with tax bill or doing some public relations work would cost money. The City is at the limit for postage for tax bills and additional inserts would cause the postage to go up to the next limit. Money is not in the budget for this. The option of including a pie chart in the City News Letter was brought up. Clerk-Treasurer Marenda noted that some communities are posting their newsletter on their web site and not mailing it out. Sewer Utility Clerk Kowalik noted she realized that Aldermen had a difficult decision to make. When planning home budget you plan for an increase and she felt taxes fell into this. It is easier to plan for a small percent increase this year rather then having to plan for a larger increase in 2005 to make up for 2004 plus whatever the 2005 increase would be. Hearing no objections, Mayor Slocomb declared a recess at 10:00 PM. Meeting convened at 10:10 PM. Mayor Slocomb read the Notice of Closed Session to convene into closed session pursuant to 19.85(1)(c) Wis. Stats., Considering employment, promotion, compensation or performance evaluation data of any public employee over which the governmental body has jurisdiction or exercises responsibility, more specifically the consideration of the elimination of specific positions. Action may be taken in closed session. The Committee of the Whole will then reconvene into open session to continue with agenda items. Ald. Petfaksi moved to go into closed session at 10:01 PM. Seconded by Ald. Patterson. Upon roll call vote, motion carried 7 – 0. Ald. Petfaksi moved to convene into open session at 11:54 PM. Seconded by Ald. Patterson. Upon roll call vote, motion carried 7 – 0. Discussion continued on the 2004 Capital and Operating Budgets. Mayor Slocomb stated that there was not any action taken in closed session. The committee needs to look at some other issues and the impacts of them. One issue is insurance co-pay – the percentage of the premium. Ald. Petfalski stated he is looking for four percent the first year and three percent the second and third year for a total of ten percent premium contribution. Ald. Schroeder asked about fixed amount vs. percentage of premium. Ald. Petfalski stated he wanted a percentage. Ald. Buckmaster requested Finance Director provide amounts as to how it would affect the percentage brought forth. Ald. Patterson asked about looking at implementing over two years, five percent and five percent, instead of three years. Ald. Schroeder expressed his concerns about using a percentage. Ald. Petfalski would be okay with a three-tier health insurance program with each tier paying something. Finance Director Gunderson will bring back to committee dollar amounts and how this would affect the average non-representative and representative employee. Finance Director Gunderson will also look at a different funding source for the extra eight-hour workday. Committee did not see a need to go into closed session number two. New Business - None Communications and Miscellaneous Business as Authorized by Law - None Adjournment Being no further business to discuss, Ald. Patterson moved to adjourn the meeting at 12:08 PM. Seconded by Ald. Petfalski. Motion carried 7 - 0. Respectfully submitted, Dawn R. Gunderson, CPFO Finance Director