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AGENDA ITEM <br /> <br />Prepared By: RJO Reviewed By:A. Carlson Approved By: <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />1. Purpose. The purpose of the action item is to gain approval to pay invoice #20230012 from the City <br />of Long Lake for the 2022 Fire Department overage. <br /> <br />2. Background. The City currently contracts for fire services with the City of Long Lake. The annual <br />contract fee is calculated based on an allocation formula applied to the approved annual budget. Because <br />budgets often vary from actual expenditures, Section 13 of the contract calls for an annual comparison of <br />budgeted to actual costs. It includes the following language regarding the annual comparison: <br /> <br />The actual costs set forth for the prior contract year may result in either a surplus or deficit with <br />respect to the to that year’s Annual Operating Budget. Any surplus shall be refunded to the contract <br />cities in the same ratio as the cost allocation formula. Any deficit shall be funded by the contract <br />cities in the same ratio as the cost allocation formula. <br /> <br />In 2022, the comparison resulted in a budget overage of $54,130. Orono’s share of the overage (85%) is <br />$46,010.50. At the April 24th council meeting, the council had questions regarding the bill and did not <br />approve payment of the overage. Staff has reviewed the overages with Long Lake and has agreed that <br />they are all related to the 2022 fire department budget year. In consultation with the City Attorney staff <br />agrees that the invoice should be paid as presented. <br /> <br />3. Cost. The invoice is in the amount of $46,010.50. <br /> <br />4. Funding. The invoice will be paid from the 2023 Fire Department operating budget. This <br />department will be over budget for the year. <br /> <br />5. Staff Recommendation. Staff recommends that the Council approves payment of invoice number <br />20230012 to the City of Long Lake. <br /> <br />COUNCIL ACTION REQUESTED <br />Motion to approve Long Lake invoice #20230012 for the 2022 Fire Department budget overage. <br /> <br /> <br />Attachments: <br />1. Invoice 20230012 <br />2. Surplus/Deficit billings <br />Item No.: 22 Date: May 8, 2023 <br />Item Description: 2022 Long Lake Fire Overage <br />Presenter: Ron Olson <br />Finance Director <br />Agenda <br />Section: <br />Finance Report