City Council - 10/18/2011 - Workshop APPROVED MINUTES
CITY COUNCIL WORKSHOP & OPEN PODIUM
TUESDAY, OCTOBER 18, 2011 CITY CENTER
5:00—6:25 PM, HERITAGE ROOMS
6:30—7:00 PM, COUNCIL CHAMBER
CITY COUNCIL: Mayor Nancy Tyra-Lukens, Council Members Brad Aho, Sherry Butcher
Wickstrom, Kathy Nelson, and Ron Case
CITY STAFF: City Manager Rick Getschow, Police Chief Rob Reynolds, Fire Chief George
Esbensen, Public Works Director Robert Ellis, Community Development Director Janet Jeremiah,
Parks and Recreation Director Jay Lotthammer, Communications Manager Joyce Lorenz, City
Attorney Ric Rosow, and Recorder Lorene McWaters
Workshop - Heritage Room H
Council Member Butcher Wickstrom was absent.
I. 2012-2013 BUDGET
Presentation
Finance Manager Sue Kotchevar presented an overview of the proposed 2012/2013
budget, including the utility funds, the liquor fund and the general budget. Kotchevar
said in 2009, the City completed its first utility rate study conducted by an outside vendor
(AE2S). The study resulted in implementation of rate adjustments, including a tiered rate
structure that promotes conservation. Kotchevar showed a graphic that illustrates how
much Eden Prairie and other nearby communities pay for utilities. Eden Prairie's rates
were the seventh lowest of 34 cities. Kotchevar noted that for all three utilities (water,
sewer and storm), operating revenues are increasing at a great rate than operating
expenses. She said this is necessary to build up adequate reserves to cover unexpected
expenses (such as the 2010 replacement of the water plant roof for$2 million).
Kotchevar said liquor revenues are budgeted to increase 3 percent in 2012 and in 2013.
Expenditures are budgeted to increase 3.3 percent in 2012 and 2.7 percent in 2013. Profit
of over$1 million each year will be transferred to the capital improvement program.
General Fund revenues are budgeted to increase 4.1 percent in 2012 and 2.8 percent in
2013. Development revenue is expected to continue to be volatile. A 6 percent increase
is budgeted for 2012 and no increase is budgeted for 2013. Parks and Recreation charges
for services continue to grow due to increased activity and fee increases. Other non-tax
revenue sources are not growing. Expenditures are budgeted to increase 3.9 percent in
2012 and 2.7 percent in 2013.
Kotchevar reviewed details of several areas of general expenditure. Wages are budgeted
to increase 2.55 percent in 2012 and in 2013, including step increases and an additional
police officer. Kotchevar reviewed areas in which employees have participated in cost
savings, including increased health insurance co-pays, a wage freeze in 2010 and
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October 18, 2011
Page 2
elimination of car allowances. Kotchevar said volunteer wages are budgeted to increase
$140,000 in 2012 and $110,000 in 2013 if the fire duty crew is implemented.
For 2012, the median value home is $326,800. The tax impact for the median value
home would be $6, which represents a .5 percent increase. Apartment buildings would
see an average increase of$1,386, and commercial properties would see between $200
and $612 average increase depending on the value of the property.
Kotchevar also reviewed the City's "rainy day" fund policy. The current policy calls for
15 percent to be set aside for budget stabilization. Staff is recommending that 10 percent
be set aside for emergency purposes and maintenance of the bond rating and 5 percent be
set aside for budget balancing.
Discussion
Council Member Nelson asked if staff knows how much home delivery of groceries,
which includes liquor, is cutting into municipal sales. Kotchevar she does not have data
available on this issue,but she will look into whether or not we can obtain it. City
Manager Rick Getschow noted that liquor store hours are being expanded to better meet
the needs of customers.
Council Member Aho asked how staff determined that the proposed two percent wage
increase is in line with neighboring cities. Sue said the proposal was based on surveys of
other cities. She said she can provide more detailed information for the Council.
Getschow updated the Council on the duty crew initiative. He said that surrounding
communities that have implemented the duty crew have cut their response times by as
much as half.
Council Member Aho asked how the budget stabilization fund will be replenished.
Kotchevar said that would be the result of positive financial performance. Council
Member Case suggested putting the City's policy for use of the budget stabilization fund
into writing so that future City Councils and residents know what this pot of money is
for. He said he is in favor of separating out the rainy day fund as proposed by staff.
Council Member Aho said he is pleased with the level of information staff presented,but
that he will need to dig through it more. He said he is hesitant to approve a two percent
wage increase, and would like more information on how Eden Prairie compares with
other cities. Council Member Nelson was also pleased with the information presented,
which she said is much more detailed than in the past. She said the proposed increase in
the budget seems reasonable and that staff has prepared a responsible budget. Mayor
Tyra-Lukens said she also likes the level of detail in the document staff prepared.
Council Member Case said he is comfortable with the proposed budget and he also likes
the way the information was presented.
II. REDISTRICTING
City Clerk Kathleen Porta gave an update on redistricting. She said the Legislative
Redistricting Committee submitted their plan to Governor Dayton on May 18, and it was
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October 18, 2011
Page 3
vetoed on May 19. Five Minnesota Supreme Court Judges were appointed to a Special
Redistricting Panel and have held eight hearings to gather public testimony. The
Legislative plan divides Eden Prairie into three representative districts and two senate
districts. Currently, Eden Prairie has two representative districts and one senate district.
The Legislative plan would combine a portion of Eden Prairie with Chanhassen and
Victoria and a portion with Bloomington. Porta said the Special Redistricting Panel is
accepting written statements until Friday, October 21. Mayor Tyra-Lukens asked the
Council Members if they are interested in weighing in on the proposal. Aho said the
current configuration makes more sense than the proposed map. Case said it appears
under some proposals, Eden Prairie could end up without a representative who lives in
Eden Prairie. Nelson noted Eden Prairie was divided differently in 1992, and that did not
work well for the City. There was general consensus among the Council Members that
staff should draft a letter to the Special Redistricting Panel stating our desire to limit the
number of representative and senate districts in Eden Prairie.
Open Podium - Council Chamber
III. ADJOURNMENT