Loading...
HomeMy WebLinkAboutBudget Advisory Commission - 08/04/2011 APPROVED MINUTES BUDGET ADVISORY COMMISSION MEETING THURSDAY,AUGUST 4, 2011 6:00 P.M., CITY CENTER 8080 Mitchell Road Eden Prairie, MN COMMISSION MEMBERS: Chair Rick King, Vice-Chair Jon Muilenburg Commissioners: Annette Agner, Eapen Chacko, Dan Funk, Michael Morris, Chris Nylander CITY STAFF: Sue Kotchevar, Finance Manager; Tammy Wilson, Finance Supervisor; Jan Curielli, Recorder I. ROLL CALL/CALL THE MEETING TO ORDER Chair King called the meeting to order to 6:03 PM. Morris was absent. II. MINUTES A. BAC MEETING HELD TUESDAY JULY 12, 2011 MOTION: Chacko moved, seconded by Funk, to approve the minutes of the meeting held Tuesday, July 12, 2011, as published. Motion carried 6-0. III. CITY AUTHORITY TO CHARGE FEES Kotchevar said City Attorney Rosow's memo cleared up some things. She thought there was a good distinction made between regulatory and non-regulatory matters. King asked if there was anything in the memo that changed the Commissioners' thinking. Nylander said he was somewhat surprised at the ambiguity around street light utility fees since many cities already have those in place. King noted it was clear the fees had to tie closely to what they are charged on for regulatory matters,but non-regulatory areas seem to be wide open. He asked if the City Council received copies of Mr. Rosow's memo so we can make the assumption they have that background information. Kotchevar said the Council did receive copies. IV. REVIEW/DISCUSS DRAFT BAC REPORT King said we have a nice solid report to work from, and the two charts that were done can be plugged in easily enough. He thought it would be useful for the Commission to do a little work on the document tonight, so that we can leave the meeting either with a finished Budget Advisory Commission Minutes August 4, 2011 Page 2 document or with some things to get more information on. We could then get a draft of the final document sent to everyone on the Commission and decide if it needs more work or if it is ready to put in the Friday packet to the City Council. He and Ms Kotchevar thought that final version could go to the Council in late August. The Council could then give feedback if there were areas on which to do more work. He said we won't be able to meet with the Council in September but could meet with them in October. In the meantime we are in discussions with them about what we will be looking at after that. He noted we may not need our scheduled meeting on September 1. The consensus was to follow the timeline and procedures suggested by Chair King. Chacko said he was not sure how the table on funding the capital improvement pay as you go program ties into the draft report, and he was also not sure if the report needs a wrap-up paragraph. He said he structured the report on the direction received from the Council and gave highlights for each funding source. King said the report should list all Commission members and staff in the signature portion. He asked if there is a prescribed format to present staff work to the Council. Kotchevar said there is not if the document is included in the Friday packet, and she did not think it will be part of a Council agenda. She suggested we might want to include a title for the report. King suggested we make it a memo format and move the title "Terms of Reference" down below the opening paragraph. Chacko said he did not include highlights for naming rights as a funding source. He thought we are focusing on major sources, and naming rights would be one-time deals and would not provide long-term revenue. King suggested adding a phrase such as "as the others are more oriented to one-time revenue or are more complex" to the final sentence in the second paragraph. Funk thought this is where the illustration becomes important, and the grid should be introduced here to say we looked at this universe across the criteria and narrowed it down based on the Council's direction. The consensus was to refer to the grid as Table A in the report. The Commission then reviewed Table A which presents the comparison of the funding sources. King noted the audience for this needs to be the City Council. He thought the table could be stretched vertically to make it easier to read. The Commission discussed how best to represent whether a funding source could have a significant impact on the $2,000,000 needed from the alternate funding sources. During the discussion of the column headings, the point was made that higher ratings for "Nexus to Service Received" should be given to those funding sources that have the most direct relationship. In addition to discussing the headings for the columns in the table, the Commission discussed the ratings given each of the funding sources for each attribute listed in the column headings. Budget Advisory Commission Minutes August 4, 2011 Page 3 Funk said the funding source "Use of Debt for Reconstruction Projects" is a way to split out the liability over a long period of time even though we ultimately pay for it. Nylander suggested that column come out of the table because it isn't really a funding source. King suggested we put a note below the table that we looked at the use of debt and determined it is a strategy to get cash faster and would require one of the other sources to pay it off. Regarding the column "Based on Cost Recovery," Chacko noted the language about franchise fees states it has to be related to the cost recovery. King said the cost of providing street lights and the fee for that would be very direct,but a tax levy would not be as direct. Agner said that column seems somewhat nebulous to her and, since it is hard for us to interpret, she was concerned what others would make of it. Muilenburg thought we need to have definitions for the table. The Commission discussed how to rate the funding sources in regard to the "Fair" column. Nylander said everyone has a different perception of fair. Muilenburg suggested changing the name of the column to "Equitable." King said our goal is not to judge the fairness of the tax levy or exemptions, but rather to judge if it is still fair when we add on more. He said he thought tax-exempt property fees (PILOT) are highly equitable. Nylander asked if we are trying to tie back to the funding of roads or are we saying the funding source could be used in an equitable fashion. Kotchevar said our charge was to review funding sources to fund the gap in the CIP, and that includes a lot more things than roads. The Commission discussed whether our orientation as we rate the sources is as a taxpayer or as the City. The decision was made to label the column "Equitable to Individual." Chacko asked if the column "Broadens Collection Base" is the same as "Provides Revenue Diversification." Funk said there was a big discussion early on about broadening the collection base. The Commission decided to put in a reference to the city comparison table (Table B) after the overview portion of the report. Nylander said we should give the Council the information on the funding sources before we give them the information on what other cities are dong. Funk suggested we follow the reference to Table B with the dialogue about assessing the fees on an ad valorem basis or as flat fees.. King said we should leave table discussion for now and have two Commission members work on the final draft to make sure it is consistent and to add definitions for the column headings. Funk and Nylander volunteered. King cautioned there is not time to radically change the document, so we should have tweaks only at this point. Kotchevar said Mr. Morris provided some feedback about including a list of pros and cons on the decision regarding gas and electric franchise fees. King thought we should recommend equal treatment of both and the Council can choose. Nylander suggested we phrase it to say our perception is that implementing fees on both utilities is the most equitable. Budget Advisory Commission Minutes August 4, 2011 Page 4 Agner asked if we should have some kind of conclusion at the end of the report. Funk thought we could have someone summarize the spirit of our discussion. King suggested Mr. Funk do that since he will be working on the flow of the whole document. Funk said he could get the final draft back to Ms Kotchevar by August 15. Kotchevar noted she is on vacation the week of August 22, so she would need to get the draft out to the Commission members before she left. She said if we need to meet we could have the meeting on September 1. King said the basis for having the meeting would be if we have more than cursory work to do on the report. He said everyone needs to return their feedback by August 24, and we can determine whether to have the meeting based on the volume of feedback. MOTION: Nylander moved, seconded by Chacko, to accept the document with the edits as discussed this evening. Motion carried 6-0. Kotchevar said she received a letter from Minnesota Valley Electric stating they have about 1200 accounts in Eden Prairie. VIII. ADJOURNMENT MOTION: Muilenburg moved, seconded by Nylander, to adjourn the meeting. Motion carried 6-0. Chair King adjourned the meeting at 8:10 PM.