12-13-2010 Council Minutes - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, December 13, 2010 7:00 o'clock p.m. (6. CONTINUATION OF 2011 BUDGET HEARING, Continued) Franchot stated he is impressed with the work undertaken by Staff to reduce expenses, and that given the amount of money that is being discussed currently, in his opinion the 1 percent increase is justified. Murphy indicated he is in agreement with Council Member Franchot. McMillan stated the City has an opportunity to send a message to the taxpayers that the City is going to keep the budget at a zero percent increase given the poor state of the economy. McMillan stated in her opinion the principal of that message is significant to the taxpayers. Murphy asked where the money would be eliminated from to achieve a 0 percent increase. McMillan stated she would defer to Ron Olson but that she would propose a freeze on employee's wages. Bremer asked what the cost savings would be if the City eliminated the 1 percent increase in employees wages. Olson noted that would result in a savings of $24,000 and that to achieve a zero percent increase, the Council would need to eliminate approximately $35,000 from the budget. is McMillan stated the City could reduce their insurance contribution. . Bremer stated the reality is that the City has to heed what the City Attorney has stated as it relates to unions and nonunion wages. Bremer stated it is very unlikely the City will get by with a zero percent increase on union workers wages and that the City will need to find funds later in the year to offset that expense if the union mediates an increase. McMillan stated perhaps those funds could come out of the City's contingency fund. Olson indicated there is currently $50,000 budgeted for contingencies. Bremer stated she is fine with a zero percent increase to send a message, but that the City cannot realistically budget a zero percent increase for the union workers. Bremer stated in her view the $50,000 in the contingency fund would be enough to make up the difference. Mayor White stated he is not in favor of keeping the nonunion workers at a zero percent increase and that Orono's Staff does an excellent job and has reduced personnel wherever possible. White commended the public works department for plowing the streets promptly during the recent snow storm. White stated a $25 increase on a million dollar house is not a major increase and that the City of Orono has some of the lowest taxes in the county. White commented in his opinion the City's employees are worth keeping. Franchot asked what the City's experience has been with the contingency funds over the past several years. Olson stated it depends on the year. In 2010, the City will only spend approximately one -half of the contingency fund, but that in other years they have spent in excess of what was put aside as a contingency. Page 5 of 27