HomeMy WebLinkAboutCity Council - 05/05/2020 - Workshop
APPROVED MINUTES
CITY COUNCIL WORKSHOP
TUESDAY, MAY 5, 2020 5:30 – 6:30 PM, VIRTUAL MEETING
CITY COUNCIL: Mayor Ron Case, Council Members Brad Aho, Kathy Nelson, Mark
Freiberg, and PG Narayanan
CITY STAFF: City Manager Rick Getschow, Police Chief Greg Weber, Fire Chief Scott Gerber,
Public Works Director Robert Ellis, Community Development Director Janet Jeremiah, Parks and
Recreation Director Jay Lotthammer, Administrative Services/HR Director Alecia Rose,
Communications Manager Joyce Lorenz, City Attorney Maggie Neuville, and Recorder Katie
O’Connor
Workshop – Virtual Meeting (5:30)
I. 2019 AUDIT AND FINANCIAL STATEMENTS (5:30-6:10)
Chris Knopik and John Lorenzini from CliftonLarsonAllen, presented a summary of the City
audit. Knopik stated the audit team consisted of Chris Knopik, John Lorenzini, Troy Gabler,
Emma Casey, Greg Lundberg, and Grace Trocinske.
Lorenzini presented the audit results. The City has an unmodified, clean, opinion for the
December 31, 2019 financial statement audit. There was one audit adjustment due to two
grant reimbursements being received later than expected. There were no significant
deficiencies. There were no legal compliance findings. The Governmental Accounting
Standards Board (GASB) new accounting policies are in regards to fiduciary activities. There
were no difficulties in performing the audit.
Lorenzini presented financial results. The general fund revenues were $2.6 million, 5.5
percent over budget. Expenditures were $767,000, two percent under budget. There is an
$893,000 increase in fund balance for 2019. Within the unassigned fund balance, 50 percent
of the following year’s tax revenue is working capital. Budget stabilization accounts for 15
percent of next year’s budgeted expenditures. General fund revenues were up $1.7 million, or
four percent, compared to 2018. General fund revenues and expenditures have been
consistent. Property taxes account for approximately 71 percent, 12 percent for charges for
services, 10 percent for licenses and permits, four percent for intergovernmental, and three
percent for other.
Lorenzini stated there was an increase of $781,000, or 2 percent, for general fund
expenditures compared to 2018. Water fund operations operating revenues have decreased
8.6 percent from the prior year due to a decrease in usage. Operating expenses decreased 10.6
percent. There was $1.7 million cash flow provided by operations in 2019. The ending
balance for 2019 in that fund was approximately $17 million. Wastewater fund operations
operating revenues increased 5.8 percent from the prior year. Operating expenses increased
4.3 percent. The ending fund balance in 2019 was $5.6 million.
City Council Workshop Minutes
May 5, 2020
Page 2
Operating revenues in stormwater fund operations was up 15 percent. Operating expenses
were up two percent from 2019. The total cash and investments balance was $3.6 million,
which is an improvement over last year. The advance for the Burr Ridge project from 2015
has been paid down each year. It is now paid down to $786,000.
Aho inquired when the City anticipates paying the debt off. Kotchevar responded in four to
five years.
Knopik stated liquor store sales increased 2.1 percent for liquor fund operations. Similar to
the prior year, the City transferred $800,000 to the capital improvement maintenance fund.
Gross profit was up $100,000, or 3.5 percent. Net profit was up $98,000. The gross profit
percentage was up slightly from 2018. The 2019 gross profit percentage for the 7-County
Metro area is unknown at this time. The City has continually had a higher percentage than
the 7-County Metro.
Knopik stated the estimated market values increased $1.6 billion from 2010 to 2020. 2020
estimates are $11.1 billion. 2019 increased $454 million from 2018, a total of $10.7 billion.
Aho inquired about the impact of COVID-19. Getschow stated 2020 values were set in 2019.
What happens the rest of this year will determine what values are set for the following year.
Aho added he is concerned about the loss of revenue in commercial value, ultimately putting
stress on residential taxes.
Knopik stated there is an inverse relationship between tax capacity and tax capacity rate
The overall tax rate for the City was 32.34 percent in 2018, 31.52 percent in 2019, and 31.48
percent in 2020. City taxes paid for a median home is the fourth lowest compared to
surrounding cities in 2019. The revenues per capita increased $218 from the prior year.
Compared to other cities of comparable size, per capita revenues were $244 more. Eden
Prairie has not received local government aid (LGA) since 2003. The City’s per capita
expenditures total increased $229 from 2018, primarily due to capital expenditures. Per
capital current expenditures are $87 more than other similar sized cities in the State. This is
primarily due to the City’s parks and recreation, public safety, and community development
programs.
Case inquired if the numbers are weighted based on the size of the city. Knopik responded
they are not weighted. All the numbers used are the raw data.
Knopik stated the financial statements are required to be submitted to the office of the state
auditors (OSA) by June 30, 2020. Effective December 31, 2020, the GASB statement No. 87
will impact leases. They are looking to issue a delay due to COVID-19. In this case, changes
will not be applicable until December 31, 2021. The City has continued to retain its AAA
bond rating and is one of 28 cities in the state. The City has also received the Government
Finance Officers Association (GFOA) Certificate for Excellence in Financial Reporting since
1990.
Aho noted his appreciation and acknowledged the hard work of the finance staff. Council
Members echoed those statements.
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May 5, 2020
Page 3
Getschow stated in regards to COVID-19 and the impacts on the 2021, two of the workshops
in the summer will cover this topic. Some cities are seeing impacts due to diversified revenue
streams such as lodging taxes or loss of LGA funds. The City has budgeted for a delay of
property taxes. Parks and Recreation impacts could be .5 percent of general fund revenues.
II. CDBG-CV FUNDS (6:10-6:30)
Stanley stated $168,055 community development block grant coronavirus (CDBG-CV) funds
were awarded to the City under the Coronavirus Aid, Relieve, and Economic Security
(CARES) Act. There has been an emphasis on dispersing the funds quickly. The public
services cap of 15 percent has been waived. The activities for the funds must be tied to a
COVID-related need. Funds can be used to reimburse activities already undertaken, if they
prevented, prepared for, or responded to Coronavirus. A spend by date has not been
announced. Some potential eligible expenditures are financial assistance for rent, mortgage,
utilities, or arrears; food support; senior services; staff costs to determine eligibility for
programs; staffing for increased food assistance; and personal protective equipment (PPE).
Stanley stated the staff action to date has had an aggressive timeline for City acceptance of
funds, issuance of requests for proposal (RFP), and amendment to the Annual Action Plan;
solicited proposals from existing partners; reviewed applications; and brought the item before
Council for approval.
Stanley stated the City has received a request of $90,000 from People Reaching Out to
People (PROP) to be utilized for housing direct services, increased staffing for housing
COVID-related fresh produce purchases, and a three door cooler. There was a request from
Senior Community Services for $880 to assist with PPE for use in its Household and Outside
Maintenance for Elderly (HOME) program.
Stanley stated if both are fully funded and $10,000 is deducted for administrative funds, the
remaining balance is $61,920. The recommendation is to fully fund both requests.
Case stated it has been beneficial to have the office of housing and community services
(OHCS) as a resource. Nelson stated the Eden Prairie Foundation has funded an organization
that assisted with school lunches, and this may be something to consider providing additional
funds to. Narayanan added other organizations to consider are Meals on Wheels, or any
organizations that assist with mental health.
Case inquired if the remaining funds would come back to a Council meeting for approval.
Getschow noted requests could be reviewed by Council but may not require approval.
Case stated his preference would be to provide funds for food, rent, and mental health
assistance. Eden Prairie Foundation is also looking to fund these needs. He inquired what the
specific approval will be at the Council meeting. Stanley replied the Council would approve
the use of the funds and the specific requests. Council would also direct the preferences for
additional funding. Nelson noted she would like to be certain fire and police have adequate
PPE. Getschow stated the funds have to be targeted for low to moderate income recipients.
The City has budgeted for PPE needs.
City Council Workshop Minutes
May 5, 2020
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Freiberg stated he supports food assistance programs, and he agrees with supporting Meals
on Wheels and the school lunch program. Aho noted he does not want to create delays for
dispersing the funds. He prefers the City to fund needs as they arise. Narayanan stated he is
uncertain about immediately dispersing all funds, and perhaps funds could be incrementally
dispersed to serve the greatest need. Case stated the Council is leaning heavily on the
OHCS’s recommendations for funding, as they are very aware of the needs in the
community.
III. ADJOURNMENT