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HomeMy WebLinkAbout12-18-1990 Council Budget Hearing Reconvened Packett V. , ' — . . DECl S !59a 1991 BUDGET HEARING OF Gi ‘Q*o CONTINUATION CITY OF ORONO DECEMBER 18, 1990 7:00 P.M. ORONO COUNCIL CHAMBERS 1.Roll Call 2.Approval of Minutes December 3, 1990 Public Hearing 3.Continuation of Public Hearing 4.Public Comments 5.Council Decision - Adoption of 1991 Budget - Resolution - Adoption of 1991 Levy - Resolution 6.Other Business - Acceptance of Certificate of Achievement for Excellence in Financial Reporting 1989 Financial Report - 1991 Compensation - Resolution - 1991 Non-Intoxicating Malt Liquor License Renewals O'Sullivans - Off Sale Navarre Lanes - On and Off Sale i 7.Adjournment ■: i'- PUBLIC ATTENDANCE CxTY OF ORONO MEETING DATE IS PLEASE FILL OUT THE INFOK-IATION REQUESTED BELOW FOR OUR CITY RECORDS. NAIdE OR NUr^BER 1, A a .v I —■_____ 2 ( 'T—X K <r '>' '/ f ^ »f. < v^V , / A. s. ! i 7- fl. n. 1. 7 ■ ' A - 7^ fl Q !0. MINUTES OF THE ORONO 1991 BUDGET HEARING HELD DECEMBER 3, 1990 OECisssa ATTENDANCE^?.00^P^M. followin£i33^i4}f^RQJjO present: Acting Mayor Edward Callahan and wounciImembers Diann Goetten and Barbara Peterson. Mayor Grabek and Councilmember Nettles were absent. The following represented the City Staff: City Administrator Mark Barnhardson. Building & Zoning Administrator Jeanne Mabusch, Public Works Director John Gerhardson, C. nance Director Tom Kuehn, Police Chie^: Mel Kilbo, and Dorothy Hallin, City Clerk. OPEN PUBLIC HEARING The Affidavit of Publication was duly noted and Acting Mayor Callahan opened the Public Hearing at 7:00 p.m. INTRODUCTORY INFORMATION Bernhardson began by welcoming those in attendance. He then gave a brief explanation of Truth in Taxation. He said, "Truth in Taxation was enacted approximately two years ago by the State of Minnesota. It established certain budget criteria for local government. Last year we v/ere only required to place a notice in the paper. This ye.ir, each property owner received a summary statement regarding the taxes for his/her lurisdiction. There are two school districts prim;»rily in this area, Orono and Westonka. The tax statement for Orono shows that taxes are proposed to increase from $l.v:38,246 to $1,8 5.J,541, or a 13.1% increase. The stateaient also shows the increases proposed for Hennepin County and the Orono School District. To some degree, these statements are misleading. Some people have added the percentages for the City, School District and County together. That is incorrect. The statement is also misleading because Orono taxpayers will not necessarily see a 13.1% increase in their property taxes. Because Orono has experienced growth in its tax base, the actual tax rate may only increase by one or two percent. This means taxes should remain nearly the same, or in some cases, be slightly less. The State of Minnesota has one of the most complicated property tax systems in the Nation. Another issue that is raising concern is talk about Minnesota's three-tier tax system." Bernhardson briefly explained how the three-tier tax system came to be. He said, "The Twin Cities/Metropolitan Area represents 50% of the State's population. The Metropolitan Area collects 64% to 66% of the State's taxes, but receives only 46% or less back. There is disparity. The money comes from this area and is distributed throughout the State. This is mainly due to the school aid formula, aid to a lesser degree, the local government aid formula. The City of Orono has had all of its local government aids taken away because our per capita tax base is too great. Orono has also had all of its homestead credits taken away because our tax base is too strong to qualify under the formulas." (Bernhardson displayed information showing how - 1 - f, -ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 disparity applies to various income levels. Bernhardson stated that property valuation and budget are two items that must be understood when considering the property tax system. He said, "For the 1991 budget, the^ property values that were set to that go back to January 2, 1990. It is the values as of that date that form the basis for the 1991 budget. Last April and May we held a Board of Review regarding the property values. Back in June of 1990, we oegan our budget cycle and by August had established a maximum total levy for taxation. We then set a location and hearing date for these meetings. The levy we established was included in the tax notice that you received. We then received preliminary tax base information from the County. It is necessary lor the City to adopt a budget and levy at either this meeting, or the December 18, 1990 meeting if this meeting reconvenes. Once the budget and levy are adopted, they are certified to the County. At the beginning of 1991, the City starts its fiscal year. The County will begin to determine what the levy will be for each individual property. All levies for each jurisdiction are placed on a property tax notice and sent to property owners in February or March. Taxes are paid in May. The City receives its first half tax payment in July. The City runs six months of its fiscal year before it realizes its major source of revenue. It is for that reason that we must have a certain amount of reserve. The second half taxes are due in October and are received by the City in December. It takes approximately one and a half years from the time the City begins its budgeting cycle to know the results." Bernhardson referred to the information partaining to proposed expenditures from the general fund and a summary of revenue sources. He stated that property taxes comprise approximately 54% of the total budget. He said, "The City of Orono receives 13.4 cents from every property tax dollar. The School District receives just under 50 cents Hennepin County gets 30 cents, and Special Districts, such as Metro Council, Metro Transit, Hennepin Parks and Mosquito Control District, receive about 7 cents. The tax capacity rate is determined by taking the total number of dollars needed, divided by the property tax base. The City of Orono has the lowest tax capacity rate in 1990 of any city over 1,000 population in Hennepin County. •' Bernhardson displayed information showing a comparison of tax capacity rates for various communities. He then presented information comparing the 1990 and 1991 levies. Bernhardson said, "The General Ad Valorum and special Assessments levies are the two items that represent our General Fund. We are proposing an approximate 4% increase in the general fund area. The major portion of the 13.1% increase is due to 1989 bonded debt in the amount of $140,000, which represents 8.5% of the increase. The 1989 bonds were issued for a sewer and water project on Highway - 2 - WilifWltillft li ■! ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 12. Tho:ie costs a-re being specially assessed against the developers. If this levy is adopted, the City can collect taxes for those bonds ahead of time and allow the City to pay them off and, in the long run, reduce taxes. The City coulc then use the special assessment income received to offset taxes in the future. This would put the City in a better financial position." Bernhardson explained what impact all of this information would have on the individual taxpayer. He said, "The City takes approximately 13% of your taxes and is proposing to increase that by 13 1%. That translates to a total tax increase of approximately 1.7%. For every $1,000 paid in property^taxes in 1990, the proposed maximum increase will be $17.00 or $1.41 per month." Bernhardson concluded his presentation and Acting Mayor Callahan called for public comments. PUBLIC COMMENTS: Mr. Leo Bullock, 2940 Casco Point Road, noted a discrepancy between the Notice and the levy information. He stated that the notice shows $1,853,541 and the levy information shows $1,823,541. Bernhardson apologized for the typographical error and stated that the Notice is correct. Mr, John Farnham, 3225 Carman Road, appreciated the opportunity to participate in the budget process. Mr. Farnham said, "I assume that all of our concerns will be listened to and considered before any vote is taken. I disagreed with the process that took place recently with Hennepin County. My main goal is to convince the Council that some changes need to occur in that 13.1% budget increase. I am hoping that the Council will see that the total tax situation, especially the property taxes, in Hennepin County have reached what I call crises proportions. I believe the term crises is appropriate for the following reasons: On the National front, wa have finally reached a consensus that we are in a recession. The main disagreements are the degree and length. Minnesota is not likely to avoid the recession completely. Recession can have many negative aspects such as business slow downs and failures, rising unemployment, personal bankruptcies. Inflation will create personal hardships of many kinds, including the inability to pay taxes. On the State level, our government faces a 1.2 billion dollar shortfall. According to past experience, that will be made up by spending cuts and tax increases. Thirdly, the County government has just hit us with the third straight double-digit tax increase and the school districts are doing the same. The Metropolitan Council is now considering a new Metro/Araa-wide half percent sales tax, plus possibly increasing the four other Metro-wide property taxes - 3 - ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 ■k: it already levies. I'm sure there are other taxes that I missed. If this is not enough to define a crisis situation, we riave tne County Auditor telling :s that property values in Downtown Minneapolis are going down. Also, considering the lack of market for high-priced homes, of whicn Oroao has quite a few, our pj^operty values are also probably declining. If that is i_he case, we will have a lower tax base on which to carry the increasing tax load. I believe this describes an overall tax crisis, especially a property tax crisis. I believe it calls for crisis budaeting, yet not one level of government seems or wants to recognize that there is a crisis. Perhaps this is because they are all looking at their individual budget needs and do not see the big picture. Hopefully Orcno will find a way to avoid adding to this crisis until the economy turns around, or property values increase again. What options does the City of Orono have to stop this escalating tax burden? Probably not much in the total picture. However, Council and City Staff does have the power to ease the pain for everyone a little. That may allow some homeowners, who have already reached their tax limit, or soon will, to keep their homes. Some of our neighbors are biting the bullet, or using other contingency funds to control their oudget increases. I talked with the Mayor of Greenwood the other day to find out how they are able to have no tax increase. to^d me that there are contingency funds. It is my understanding that Orono may have some contingency funds as well. As a last comment, everyone has heard the adage, you can't get blood out of a turnip, I truly believe that when the full impact of all government tax increases are felt, you will have hundreds of angry turnips asking why the City did not listen to them. If you vote to hold the line on the City budget, by cuts or the use of contingency funds, you can answer truthtully that you did your part to control the tax burden. If you vote to add to the ever-growing tax load, I do not believe that anyone in the world would want to be in your shoes as you try to answer the complaints." Acting Mayor Callahan said, "As an analysis of at least two- thirds of the problems, I believe Mr. Farnham's comments were fairly accurate. Unfortunately, he did not analyze the situation in Orono very well." Mr. Bruce Feik, 2455 Carman Street, had a question concerning the 1989 bond issue. He asked, "Of the amount due, how much is actually due now?" Bernhardson replied, "Vie are trying to build up funds so that we can pay off the bond." Mr. Feik stated that he cannot pay off his house mortgage - 4 ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 early and that the City shouli not have to pay oft the bonds, asked how much is due and what interest rate applies. He Bernhardson indicated that they were at a goad rate and replied, "The special assessment would pay for that." Mr. Feik did not believe that ta.xes would be reduced once the bonds are paid and reimbursed from special assessment. He recommended that the bonds be paid in the time period designated for pay off. He said, "That would reduce the increase to 4.5^=. I see no reason why the majority of the tax increase should be for the purpose of pre-paying bonds." Mr. Bob Hunt, 2691 Casco Point Road, said, "I saw a public works truck with a flat blade out the day before yesterday. There was no snow. How much fuel did he waste.’ I have been retired for five years. I am trying to move and have had my house on the market for two years. I have even dropped the price. If my house is not worth what people are willing to pay for it, then my taxes are equally the same. They are not worth what I pay. I pay nearly $4,000 a year. I think that the municipalities shou d have attended the meeting for Hennepin County, not only the residents." Mr. Jerry Kemp, 2300 Farview Lane, stated that he had attended the Hennepin County meeting. He said, "Many people complained about the rate in which taxes are increasing compared to individual income. I agree with Mr. Farnham's comments. However, it think the City should go ahp^.d and pass its proposed 13.1% increase. I believe that at some point people v/ill become fed up, just as it was in California before Proposition 13 was adopted." Mr. Kim Allen, 2118 Shadywood Road, said, "The statement that property value equals ability to pay makes me nervous. What kind of provisions are made for long-term residents who are senior citizens with a limited income and are now subject to a social security tax and their medicare is taxed. Their property values have increased, but their income has not." Acting Mayor Callahan stated that there are some provisions for senior citizens. He said, "There l.s no connection between property values and income, though property values may increase at a comparable rate with wages. However, for persons on a fixed income this is a problem. The Legislature has put limits on how much taxes can be increased and has considered a method to provide minimal assistance. However, there is really no ma3or consideration or provision in this respect. The Legislature’s view of taxation in this State has not only been guided by the principle of property value reflecting the ability to pay, but also by a promise that property taxes will be lowered in exchange for higher income taxes. However, the Legislature then figures - 5 - ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 out a way for property taxes to increase. That results from various programs that are mandated without appropriate funding. The property tax system is so complex that it is impossible to nave a rational discussion about it. The City is limited by the amount of increase in the levy tfiat we can charge each year and by the dollar amount we can collect each year. The increase in property values is not reflected by the increase in the budget. If we were able to have the same percentage apply against increased values wh=n property taxes increase, our budget situation would be much different. The passing on of the increase in the levy limit would be, for good or bad, more directly against the value of the property than it now is. On the other side of the coin, for those who assume that their property values are decreasing, so too should the dollars that are paid in taxes. Unfortunately, there is a lapse between the time that property is assessed and the time that payment of taxes for that valuation is made. At this time, the City does not know what values the County will place on property in Orono. The City is applying whatever percent of tax increase against an unknown base, which causes problems in the budget process." i j Ik i Mr, Garfield Clark, 1955 Heritage Drive, said, "What we are facing is a fundamental disenfranchisement of our views toward our representatives, starting at this level on uo. We must stop the spending. We've got to stop looking for things to cu.e with my money. There is an increasing number of people who are unable to carry the load any more. I am asking the Council specifically, as my representatives, will you please, at the loudcist voice possible, talk to Met Council, Hennepin County and the State of Minnesota. Talk to our representatives in Washington. Tell them all that we cannot handle any more. The spending must stop. Invite the public to participate at the budgeting process, not the taxation process. It is terrible to put the public in a condition where it is moments before the voting, and we have no idea what the budgets look like. The City officials know that the public is going to object to an increase in taxes, that is a given. Yet we are forced into the dilemma of coming in moments before a vote and asking you not to raise taxes. The focus must be on the budget side of the process. The City of Orono could become an example that could be used all the way up the government ladder." Mr. Bob Biesterfeld, 450 Deborah Drive, stated that he is a dentist and that he would not get away with raising his service fees, the way government raises taxes. He said, "If I did raise my rates, there would be an outcry for socialized medicine. What is happening though, is that we are socializing this Country in terms of taxes. I agree with Mr. Clark. vie need to stop spending.” Mr. Jim Lorence, 4460 North Shore Drive, stated that he had moved to Orono four years ago and purchased a home that was four - 6 - I- (:■' ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 years old. He said, "I have not done anything to my home other than to fix certain things that were not taken care of wnen the home was built. That cost me a couple thousand dollars. My taxes have increased 50% in four years. I have asked for services from the City such as the ability to make certain improvements to my property and extra traffic control from the Police Department. On both occasions, I was turned down cold, I cannot imagine how you can sit up there and tell me that you want another 13%. I think if you went back to the drawing board, you could come up with a tax decrease. We are not getting what we are paying for and it should be even less." Mr. Curt Quady, 1223 South Brown Road, stated that the numbers on the revenue sheet are interesting. He said, 'You show $474,000 for street maintenance and twice that amount to police them. It shows the amount of 5294,000 for Planning and Zoning. Ninety percent of the work that the Planning Commission does is done by the City Council. I thought that most of the money for Planning and Zoning came from fees. The charge that bothers me more than anything is legal expenses. I do not understand how we can pay one firm that much money for a part-time attorney. v;hy can't the City hire a full-time attorney?" Acting Mayor Callahan explained that at this time there is no where in the City Hall for a full-time attorney to work He said, "The cost of legal fees does not just pay for Tom Barrett's attendance at Council meetings. That amount also covers court proceedings, and particularly court proceedings following the arrest of people picked up by the police department. We have looked into this matter and found that the amounts wa collect from fines and such exceed the amount of legal fees. It has not been determined whether or not a full-time attorney would actually be able to save us any money." Mr. Leo Bullock, 2940 Casco Point Road, commended the City officials for Orono's low tax rate. He asked whether the tax rate is based on the valuation of property and the higher the property value, the lower the tax rate. Acting Mayor Callahan indicated that is correct. Mr. Bullock said, "Orono h.as very aggressive Assessors. They raise the heck out of property values and when they do that, the citizens have to pay the entire State. Not only do we pick up the increases here, but also the increases for Hennepin County and the State. In 1908 my value increased $20,0 30 and last year they raised my value another $30,000. That is with the water in front of my house gone. Not only are we paying for an increase for Orono, but for the entire State. I would rather see the property valuations a bit lower and the tax rate higher." Acting Mayor Callahan replied, "The reason Orono has its own - 7 - ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 assessor is because it has proved thar it is better to do that than have Hennepin County come out and assess the houses." Mr. Bullock asked how that can be when property values have gone up 50%. Acting Mayor Callahan stated that the City does receive information from Hennepin County comparing assessments to property values. Bernhardson added, "Acting Mayor Callahan is correct. Tne assessor values the property. The value he puts on a property is then gauged by Hennepin County. T»iey compare the assessment to the amount for which that property sells. The County determines a ratio using that information and the assessor must adhere to that ratio. If the assessor's ratios fall below that designated by Hennepin County, they will step in and raise everyone up to that level. The assessor tries to assess just above where the sales ratio will be. It is possible for him to make a mistake periodically aid that is the purpose of the Board of Review process." Mr. Ed Kale, Casco Avenue, stated that he purchased his property the taxes were $400. He said, "The place was rat infested and in terrible shape when I bought it. My taxes are now $.1,630 and all I did was clean up the mess. Also, myself and several others have formed a Lakeowncrs Association. Wa have invited every Council around tne lake to attend our meetings. We have had Gen Olson there and she told us that the laws that the Legislature passed would not affect us until this next tax Increase. She said that at that time taxes would increase approximately 25%. I believe she was pretty close. If she knew that a year ago, sc did the City of Orono. However, no one informed the taxpayers of that. I do not believe I have ever seen an Orono Council member at a meeting." Mr. Phil Byers, 3083 Farview Lane, commended the Finance Director on the presentation of the budget. recommended that everyone present should obtain a copy. He said, "It was mentioned that the City's future tax base is uncertain. The projections that are in this budget have been made under a great deal of uncertainty. For example, fuel for the police department will not be the same that it was last year. However, the budget shows it to be the same. When you budget in an environment where the revenue projections turn out to be too high and the expense projections too low, the consequences come close to a crisis. So if we try to prepare a budget with great uncertainty associated with it, we are playing with fire. Consequently, I would ask the Council to consider adopting a procedure of deferring approval of part of the requested increases until June. The budget could be adjusted after reviewing the tax capacity and property value assessments and seeing where the police department fuel - 8 - d. ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990expenditure is after six Tionths. The personal services, for example, if 50% of what is requested were adopted and 50% deferred until June, that would save about 345,000. If 50% of capital expenditures, including automobile purchases, were adopted now and 50% deferred, we would save between $20,000 and $30,000. By saving, I don't mean that the expenditure would not occur, but that it occur when the City knows it can afford it. With the uncertainties that exist now, the City does not know that. The capital expenditures, such as $5,000 for a water fountain I think would probably be eliminated. The budget shows $560,000 for a bridge across somewhere on old Crystal Bay Road. It indicates that those funds -.-ill come from the State and they are not really taxpayer funds. Wrong, they are taxpayer funds. I think it is irresponsible for the City to maxe an expenditure of that nature just because someone made the money available. That money is coming from somewhere, partly from us. I also think it would be irresponsible to undertake such a large project without knowing where Highway 12 is going and what impact that may have on the bridge. I would suggest that project be deferred. ** Acting Mayv.» Callahan stated that the City does not spend everything on January first. He said, "On the revenue side of the matter, we dev.'t get the first half tax revenues until July and the second half until the end of the year. The law requires us to establish the budget now and establish che portion of the taxes that are to be collected. We cannot do it any other way because there would be no way to get it on the tax statement. The bridge is getting older and needs to be repaired. There are also a number of rv,;ad improvements that must be considered. These types of improvements are usually included in a long-term plan or forecast. The construction of the bridge would it begin without further hearings to determine whether the projpv should proceed. An item such as the bridge becomes part of the budget because the long-range forecast indicates that this is the year we should consider such an improvement. The City does monitor expenditures, even though we may have something in the budget. In fact any item costing more that $1,500 is brought before the Council for consideration." Ms. Jan Kellar, 1223 Arbor Street, asked about a budget amount of $5,900 for a special levy/sewer assessment for the City building. Bernhardson replied, "That is the Cxty's share of the Crystal Bay sewer for the government building. We were assessed $3,000 as part of that project (for 1991). The other part is the portion of that special assessment that we pay for an improvement on Woodhill Avenue." Mr. Wilbur Anderson, Frederick Street, asked if this budget included anything for a new city facility. - 9 - >*lONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990Acting Mayor Callahan explained that this is an operating oudget. He said, "There is a building fund that is reflected in the operating budget and some of the income, in the form or investment income is reflected in this budget. Adoption of this budget will not determine how monies will be appropriated for the new building." Another resident reiterated earlier comments made regarding the early payment of the bonds. He did not believe that he should be taxed an additional 8% for that purpose. Goetten stated that she had questioned the need to pay the bonds early. She said, "As far as I am concerned, that does seem to be an item we can eliminate." Mr. Quady asked how taxes are figured. Bernhardson explained, "The County takes the taxes that are adopted by each jurisdiction and takes the total tax capacity for that jurisdiction and divides one into the other. That provides a tax capacity race. The tax capacity rate for the City is what is shown on your tax statement. The same formula is used for the i-chool District, County and Special Districts. Using each property market value, a tax capacity is determined. That number is multiplied by the combined tax capacity rate and that determines your tax. There is no longer a mill rate." Acting Mayor Callahan reminded everyone that the City of Orono is operating without local government aid. Mr. Clark asked if it would be helpful to have the citizens assist with lobbying the Legislature. He stated that there are a number of people that would be willing to do that. M.r. Clark then asked for clarification regarding the Old Crystal Bay Bridge- He asked, "How is it that half a million dollars is included in the 1991 budget for the bridge. vmat is the total cost of the bridge and what is the City’s share of that cost and how is that included in the budget." Bernhardson replied, "The bridge is not included in the general fund and there Is no property tax increase due to that. The money will come from another fund and has been included for planning purposes. We receive money from the gas tax, so it does come from everybody. However, the City receives an appropriation of approximately $160,000 every year from the gas tax, which we contribute toward various projects. We have been saving for the last couple of years. The City is very concerned about the condition of the Old Crystal Bay and Willow Drive bridges. The taxpayers are not paying more property taxes :.n 1991 to pay for the bridge. To go back for a minute to lobbying the Legislature, the - 10 - _l: . OROMO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990 City’s representatives, John Burger, C-e i Olson, and I am sure Steve Smith, have been very receptive to our concerns. It is the people outstate and in majority districts represented by DFLers that we need to convince." Mr. Clark asked if the interest from investments from the building fund will be included in the operating fund, or stay in the building fund. Bernhardson replied, "We are estimating that we will earn $170,000 in interest on that money. We have a $102,000 transfer back into the general fund. W.j are trying to lessen our transfer amounts because we do not want to spead the money." Mr. Gabriel Jabbour, 985 Tonkawa Road, stated that he understood that the 8.5% tax increase for the bond pay off would be used as a financial security measure. He said, "Though it seems to be a good business practice, it is hard to determine whether it is fair for the residents of Orono to pay taxes now for future spending. At the time we are ready to spend this money, some of these residents may not live in Orono. Is this a common practice? I would also like to have thi' Administrator address the 4.1% portion of the budget." Bernhardson explained that the 4.1% increase in the general fund budget is primarily due to expenditures in the personnel area. He said, "Direct personnel expenditures anu contracts constitute approximately 60% of that amount. Tnere is approximately 3% to 4% included in the budget for inflationary increases for salary schedule. Tne one position that we have added this year is in the septic area. We do collect septic fees and will be increasing those fees for the first time in ten years. Part of that increase will be used to offset the new position. Orono has approximately 1,000 septic systems throughout the community. We are expecting that to increase to 1,500 to 1,700 over the next eight or ten years. The purpose of the program is to forestall the need to have sewer in rural areas. That is why this is looked on as an investment for existing and future septic systems. With our existing personnel, it has been difficult to provide the kind of service in this area we would like. The purpose of the additional position is to strengthen that service and avoid the need for costly sewer in the long term. The position has bean handled in the past by Michael Gaffron and Lyle Oman. In the summer wa have hired a temporary person to assist." Mr. Clark asked if the Council would opt to vote for a zero budget increase. Mr. Pete DuBois, 90 Myrtlewood, said, "This tax increase is insignificant. There are" a lot of tax increases happening at this time. There is a recession coming; I'm a fairly young man - 11 - ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3. 1990 with a young family. I am just getting to a point wher? I can put some money away. Suddenly everyone is increasing my taxes. I am asking t^e City to tighten its belt a bit. There is no guarantee that the Cxty will not increase taxes at this level again next year. If there is any way for the City to reconsider and lower the increase I would appreciate it.'' Acting Mayor Callahan stated that the majority of the cost of running the City involve personnel costs. He said, "All of you who are employed and employ other people, realize that there is a demand on one side or a scream on the other, to raise salaries each year. Common justice suggests thac employees of the City do and should get increases from time to time. That constitutes the majority of the budget. The number of personnel that the City hires is limited and there are no excess people in any department. The City could not function in an orderly manner without the people it currently has employed. Wa cannot keep these employees at a certain rate of pay. We need to give them some kind of an increase. The Council believes that we are doing a good job. We watch the personnel carefully and the increases in salary as well. As the number of households in the City increase, the cost of services performed also becomes higher because more has to be done. There are more streets that need to be cleaned. The police department has more area to cover. The building inspector has more buildings to inspect, etc. The taxes are part of a result of this. The City does compare the cost of hiring a -.rvice full-time as opposed to contracting on an hourly basis. We realize that the property values in this community are very high. The City Council still compares the relationship of property values to the levy with other cities to assure that we are not out of line. It is difficult for a Council to judge a budget line by line. I believe t.ie Council and City has done a good job in assuring that the City has not fallen into debt and have been able to fund unexpected items that occur througaout the year. The item of the bond refunding is an item which can bs cut out of the budget. However, the idea should have been presented. The City must look into the future and consider future trends and expenditures. Our ability to raise money is limited by statute. The recession that has been talked about and the certainty that the State is going to raise taxes is frightening. I agree with the points made by Mr. Jabbour, that what has been proposed does make good business sense." - 12 - r I' ORONO BUDGET PUBLIC HEARING MEETING HELD DECEMBER 3, 1990ADJOURNMENTIt was the consensus of Council to adjourn the 1991 Budget Hearing meeting at 9:05 p.m. and reconvene the Public Hearing on December 18, 1990 at 7:00 p.m, at the Orono Council Chambers. Edward J. Callahan, Jr Acting Mayor .ATTEST: Dorothy M. Hallin, City Clerk - 13 - S . ...iuirnb DEC 10 1990 C!TY OF CRQHO A RESOLUTION TO ADOPT THE 1991 BUDGET BE IT RESOLVEDr by the City Council of the City of Orono, County of Hennepin, Minnesota that the 1991 General Fund budget is determined to be as follows: ESTir^TED REVENUES Taxes - General - Special Levy City Assessments - Penalties and Interest Licenses and Permits Intergovernmental Charges for Services Fines and Forfeits Interest Income Other Transfers From Other Funds TOTAL APPROPRIATED EXPENDITURES General Government Public Safety Street Maintenance Parks and Recreation Recycling Program Engineering ~ Unallocated Reimbursable Expenditures Special Projects - Contingency Transfers To Other Funds TOTAL $1,644,831 5,910 6,499 123,300 180,700 770,500 118,150 53,300 16,700 120,370 $3,040,260 $ 716,510 1,563,630 474,770 53,290 68,390 4,950 32,250 65,720 60,750 $3,040,260 SSSSSS.5S3S llv u m i: '»‘’i! BE IT FURTHER RESOLVED, that non-profit non-government related organizations will require separate Council approval prior to expenditure of funds. Adopted by the City Council of the City of Orono, Minnesota at a special meeting held December 18, 1990. ATTEST: Edward J. Callahan, Jr., Acting Mayor Dorothy M. Halim, City Clerk -q - r f;;£tTiHQDEC 19 1990 CiTY OF ORONO A RESOLUTION APPROVING THE FINAL 1990 TAX LEVY COLLECTIBLE IN 1991 BE IT RESOLVED, by the City Council of the City of Orono, County of Hennepin, Minnesota, that the following sums of money be levied for the current year, collectible in 1991 upon the taxable property in the City of Orono, for the following purposes: General Fund $1,644,831 Special Assessments against City property for the City*s share of 1985 sanitary sewer project (G.O. Sewer Imp Bond 1985)5,910 G.O. Sewer Improvement Bond 1985 G.O. Sewer Improvement Bond 1980 40,000 17,300 G.O. Sewer, Water, Street Improvement Bond 1982 5,500 TOTAL $1,713,541 The City Clerk is hereby instructed to transmit a certified copy of this resolution to the County Auditor of Hennepin County, Minnesota. Adopted by the City Council of the City of Orono, Minnesota at a special meeting held December 18, 1990. Edward J. Callahan, Jr., Acting Mayor ATTEST: Dorothy M. Hallin, City Clerk DEC 10 19 ?0 TO:Mayor and City Council PROM: Mark E. Bernhardson, City Administratojf:' ^ DATE: December 14, 1990 . or G k GHO SUBJECT: Certificate of Reporting Excellence - 1989 rinancial Report Attachment:A. Notification Letter From Government Finance Officers Association Dated 12/7/90 Re: Award of Certificate of Excellenace in Financial Reporting ISSUE - Acceptance and congratulations for receiving this award for the third consecutive year. INTRODUCTION - The City of Orono has been awarded the GFOA*s Certificate of Excellence in Financial Reporting for the third consecutive year for its 1989 comprehensive annual financial report. RECOMMENDATION - It is recommended that the Council congratulate particular ly the Financial staff for their ongoing efforts, the City's Auditor who has assisted in achieving this award and the Council itself for its efforts in leadership in promoting the City to seek this award. PROPOSED MOTION - Moved by seconded by , that the Council the rest of thecongratulate Tom Kuehn, rTnance Director# Financial staff and the staff as a whole for the City's excellent financial reporting# and Pannel Kerr Forster# its Auditors# for their invaluable assistance. Ayes _# Nays _. cc:Thomas Kuehn# Finance Director Pannell Kerr Forster h-- *■ »V 3GVE=u:/EMT ^^MAr^JCE QFFICEPS ASSGCiATlGN 180 North Micnigan Avenue Suite SCO Chicago 'imois SC6C * 312. 977-97C3 • -a* 312. 977 48C6 December 7, 1990 The Honorable James R. Grabek Mayor City of Orono P.O. Box 66 Crystal Bay, Minnesota 55323 Dear Mayor Grabek: We are pleased to notify you that your comprehensive annual finan* cial report for the fiscal year ended December 31, 1989 qualifies for a Certificate of Achievement for Excellence in Financial Reporting. The Certificate of Achievement is the highest form of recognition in governmental accounting and financial reporting, and its attainment represents a significant accomplishment by a government and its management. When a Certificate of Achievement is awarded to a government, an Award of Financial Reporting Achievement is also presented to the individual designated by the government as primarily responsible for its having earned the certificate. Enclosed is an Award of Financial Reporting Achievement for: Thomas M. Kuehn, Finance Director. The Certificate of Achievement plaque will be shipped under sepa­ rate cover in about ten weeks. We hope that you will arrange for a formal presentation of the Certificate and Award of Financial Reporting Achievement, and that appropriate publicity will be given to this notable achievement. To assist with this, a sample news release and the 1989 Certificate Program results are enclosed We hope that your example will encourage other government offi­ cials in their efforts to achieve and maintain an appropriate standard of excellence in financial reporting. Sincerely, GOVERNMENT FINANCE OFFICERS ASSOCIATION Frederick G. Lantz Assistant Director/Technical Services Center FGL/kas Enclosures WASHINGTON OFFICE 1750 K Street. N.W.. Suite 200. Washington. D C. 20006 202/466-2750 • Fax: 202/429-2755 GOVERINiMEM Fi^JA’.CE OFFICERS AS5GClAT!0.\j 180 North Micniqan Avenue Suite 3C0 Ci'icaqc ‘.ncis £060* 31e/377-3/\_,u • fd* um. :3 I > '♦Quo For information contact; Fred Lantz (312) 977-9700 December 7, 1990 NEWS RELEASE (Chicago)—The Certificate of Achievement for Excellence in Finan­ cial Reporting has been awarded to: CITY OF ORONO by the Government Finance Officers Association of the United States and Canada (GFOA) for its comprehensive annual financial report (CAFR). The Certificate of Achievement is the highest form of recognition in the area of governmental accounting and finan­ cial reporting, and its attainment represents a significant accomplishment by a government and its management. An Award of Financial Reporting Achievement has been awarded to the individual designated as primarily responsible for preparing the award-winning CAFR. This has been presented to: TBOHAS M. KDEHN, FINANCE DIRECTOR The CAFR has been judged by an impartial panel to meet the high standards of the program including demonstrating a construc­ tive "spirit of full disclosure* to clearly communicate its financial story and motivate potential users and user groups to read the CAFR. The GFOA is a nonprofit professional aSi?ociation serving 12,200 government finance professionals with offices in Chicago, Illinois, and Washington, D.C. - 30 - WASHINGTON OFFICE 1750 K Street. N.W.. Suite 200. Waehinqton. O C. 20006 202/466-2750 • Fai: 202/429-2755 The Government Finance Officers Association of the United States and Canada present a (his AWARD OF FINANCIAL REPORTING ACHIEVEMENT to: TinniAs M. KiiniN lUJANCE DIRECTOR C1TV or ORONO, MINNESOTA Till' AwanI of Fiiuutc: il fir/Huting Achicvrnu ’iil ts f’li’senteil hy llw i^oreinnicnt Tiiuwce Officers Assoi iiilion to those iruhvutiurls loho liorc heen iiistnimeiihil in their government unit nehirving it Certifiaite of Acini vement for Excellence in Fninncinl Reporting. A Ceitifiente of /LiiiViu ’iiirnf is fo those govcinment units whose annnni financial reports are fmlgeil to ailheie to piogimn stanilnnls ami represents the highest award in gonernrne hnancial reporting. Exeentire Piieetot Date PECEMBER 7, 19 0 * u.-uf/nU DEC 10 1990 CiTY OF OFQNO ESTMLISHI* BE IT RESOLVr Minnesota that initial sax^^ as follows, effective Janua A RESOLUTION •ALARIES FOR CITY EMPLOYEES FOR '• > i he City Council of the City of Orono, and wages for City employees be established . 1991: NAME Mark Bernhardson Dorothy Hallin Melvin Kilbo John Gerhardson Jack Brinkhaus Thomas Kuehn Jeanne Mabusth Michael Gaffron Lyle Oman Ronald Steffenhagen Theresa Naab Linda Vee Sue Bobzine Wayne Quast Steve Hansen Dale Skreen James Gregory Barry Rathbun Randy O'Brien Scott Oberaigner Gregory Palmer Charlotte Knutson Linda Walters Bruce Vang Carol Hansing Jamie Bosma Ricky Karnitz Kevin Walsh Troy Dennison David Nelson Sally Christianson POSITION City Administrator City Clerk Police Chief Public Works Director Public Works Supr. Iln Treas/Finance Director Zoning Administrator Asst. Zoning Administrator Building Official Golf Course Supervisor Deputy City Clerk/Admin Sec. Secretary Police Secretary Public Works Supr. I Street Dept. LEO Street Dept. LEO Public Works Maintenance Public Works Maintenance Public Works Maintenance Public Works Maintenance Public Works Maintenance Depty Treas/Sr. Acct. Clerk Asst. Finance Director Field Inspector Asst. Police Secretary P.T. Copy & File Clerk I P.T. Police Officer, P.T. Community Service Officer P.T, Community Service Officer P.T, Community Service Officer P.T, Clerk, Police P.T. 1990 SALARY 1991 SALARY $57,755.00 (5/1/91 Review) 29,981.00 $31,181.00 51,074.00 53,117.00 45,781.00 47,599.00 38,072.00 39,595.00 48,643.00 50,588.00 43,588.00 45,332.00 34,798.00 36,198.00 34,798.00 36,198.00 30,023.00 31,224.00 11.523/Hr 11.984/Hr 9.795/Hr 10.187/Hr 11.523/Hr 11.984/Hr 14.741/Hr 15.331/Hr 12.54/Hr 12.665/Hr B.) 12.54/Hr 12.665/Hr B.) 13.97/Hr 14 110/Hr A.) 12.303/Hr 12.795/Hr 12.000/Hr 12.480/Hr 10.458/Hr 10.876/Hr 10.458/Hr 10.876/Hr 11.523/Hr 11.984/Hr 11.688/Hr 12.156/Hr 13.693/Hr 14.241/Hr 9.795/Hr 10.187/Hr 9.182/Hr 9.549/Hr 9.285/Hr 10.042/Hr 6.009/Hr 6.249/Hr 5.100/Hr 5.304/Hr 5.100/Hr 5.304/Hr 6.640/Hr 6.906/Hr Foot Notes: A.), B.) In addition a lump sum based on hours scheduled and worked will be paid quarterly (March 15, June 15, September 15 and December 15) A.) $.42/Hour, B.) $.38/Hour BE IT FURTHER RESOLVED, that mileage for City use of private cars on City business be reimbursed at $.26 per mile. Adopted by the City Council of the City of Orono, Minnesota at a special meeting held December 15, 1990. ATTEST: k U , I- W' v;- ■*: i I 4 'i- -P "i tU £■ 5 if I. ^::f; OECIO 1950LIST 0? LICENSES FCR COUNCIL APPR qCKEY OF Cr.GNOFOR MEETING OP December 18, 1990 RENEWALS -Off Sale Non-Intoxicating Malt Liquor for 1991 O'Sullivans - off and On Sale Non-Intoxicating Malt Liquor for 1991 Navarre Lanes Date: To: From: He: November 26. 1990 Mark Bernhardson. City Adminiatrator Mel Kilbo, Chief of Police Liquor License Renewal 0’Sullivans This Department has researched the records of above named establishment and have found no violations involving liquor violations. I recommend issuance of this liquor license.