04-08-08 Worksession
CITY COUNCIL MINUTES
Richfield, Minnesota
Special Worksession
April 8, 2008
CALL TO ORDER
The meeting was called to order by Mayor Goettel at 5:33 p.m.
ROLL CALL
Members Present: Debbie Goettel, Mayor; Susan Rosenberg; Sue Sandahl; Fred Wroge and
Bill Kilian.
Staff Present: Steven Devich, City Manager; Mike Eastling, Public Works Director; John
Stark, Interim Community Development Director; Jim Topitzhofer, Recreation
Services Director; Chris Regis, Finance Manager; Brad Sveum, Fire Services
Director; Bill Fillmore, Municipal Liquor Operations Director; Barry Fritz,
Acting Public Safety Director; Pam Dmytrenko, Assistant to the City
Manager; and Cheryl Krumholz, Recording Secretary.
Item # I DISCUSSION REGARDING KEY FINANCIAL STRATEGIES (COUNCIL MEMO
NO. 55)
Finance Manager Regis presented the key financial strategies including:
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Financial Management Plan
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Capital Financing Plan
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Future Bonds Indebtedness
Council Member Wroge stated that capital projects need to be prioritized. He mentioned the
tax impact due to the large number of home foreclosures.
Council Member Wroge expressed concern about the City being in the mini-golf course
business especially since it is not making any money and believes it should run by a private entity.
He added that he thought a dog area would be cheaper.
Recreation Services Director Topitzhofer explained a feasibility study is planned to add a
mini-golf area to the swimming pool site that could reduce costs and use existing staff. The funding
for the study was deferred from a proposed splash pad at the pool.
City Manager Devich stated the key financial strategies provide the planning for the five-year
capital improvement program. He said that recreation amenities are primarily funded by liquor store
projects.
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Recreation Services Director Topitzhofer discussed the Community Services Commission’s
priority of considering a substantial investment to renovate Lincoln Fields for a multi-use facility for
boys and girls to maximize its use.
City Manager Devich added that it is likely the legislature will no longer include ballfield
replacement funding in a bonding bill.
City Manager Devich stated that this year, the legislature bonding bill did include $100,000
for the All Veterans Memorial in Richfield and it will become law.
Mayor Goettel asked about a possible double-digit levy increase for two years so that there is
a spreading out of property tax adjustments.
Finance Manager Regis explained that after the initial tax levy the year of the bond, the
amount is calculated into the tax levy base. Proposed reductions in market value will also reduce
the City’s tax capacity values, which will have the effect to possibly increase the City’s tax capacity
rate.
Council Member Wroge asked about the impact of selling the current garage site.
Interim Community Development Director Stark explained there are site environmental and
demolition costs to be determined. Phase I work has been done but it is preferred that the developer
take on additional costs. Brownfield grants have been applied for but typically larger sites are
preferred.
City Manager Devich stated that the funds received for the garage site could be applied to
the debt service fund to spread out and buy the levy down.
Fire Services Director Sveum discussed legislation introduced requiring health and auto
insurance to pay for first responder services; but it did not make it to committee. A pilot program on
a volunteer basis is being attempted, primarily with Blue Cross/Blue Shield.
Council Member Wroge expressed concerns that the City may not just be getting money in
this situation if the residents need to pay the difference in what is covered by insurance.
City Manager Devich explained that City services are constantly evaluated for streamlining
and profitability.
Council Member Sandahl stated there is a State program to provide assistance to seniors, 65
and older, for payment of property taxes.
Council Member Wroge asked about rolling stock costs decreasing with both new City
facilities because of different storage capabilities.
Finance Manager Regis explained the equipment replacement versus maintenance costs.
Item # 2 DISCUSSION REGARDING REVIEW OF FRANCHISE FEES (COUNCIL MEMO
NO. 56)
City Manager Devich stated that in December 2003, the Richfield City Council approved by
ordinance the implementation of Gas and Electric Franchise fees effective for 2004. The fees were
implemented as a response to significant reductions in Local Government Aid (LGA) and the imposition
of levy limits by the state legislature. In addition, it was hoped that the fees would provide a dedicated
funding source for the City’s Street Maintenance Program and Forestry Program.
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-3-
April 8, 2008
Included in each ordinance was a provision that the City Council shall begin a review of the
ordinances by June 30, 2008 to determine whether to continue, terminate or modify the fee.
Currently within the adopted 2008 Budget, gas and electric franchise fees provide $720,000 of
revenues to the General Fund for the street maintenance ($700,000) and forestry programs $20,000).
Public Works Director Eastling presented a State of the Streets report.
City Manager Devich stated that funding for streets improvements were cut from the budget
one year and there was a noticeable difference in deterioration so it is very important to make a street
investment every year. The current franchise fee amount of $700,000 for street maintenance is
working well.
Public Works Director Eastling also discussed the potential to change the streets proposed for
mill and overlay repair depending upon the amount of deterioration.
City Manager Devich said pothole repair costs are from the General Fund Budget.
I ADJOURNMENT
The meeting was adjourned by unanimous consent at 6:50 p.m.
Date Approved: April 22, 2008
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Recording Secretary