09-15-1986 Special[1
1
CITY OF RICHFIELD, MINNESOTA
SPECIAL MEETING - BUDGET HEARING
SEPTEMBER 15, 1986
The meeting was called to order by Mayor Hamilton at 7:01 P.M.
COUNCIL PRESENT:
STAFF PRESENT:
John Hamilton, Mayor; Mike
Sandahl; Ivan Ludeman; Martin
Kirsch.
Jim Prosser, City Manager;
Steven Devich, Administrative
Services Director; Don
Fondrick, Community Services
Director; Bill Fillmore, Liquor
Operations Director; Bruce
Palmborg, Acting Community
Development Director.
Item #1 ENTERPRISE FUND BUDGET REVIEW
Administrative Services Director Devich made an overall
presentation regarding water, sanitary sewer and storm sewer
rates proposed for 1987. Mr. Devich stated that the total
increases on several sample bills would result in an
approximately 2.4X increase for homeowners for 1987.
Administrative Services Director Devich highlighted the
Water Utility Fund, indicating that the proposed increase in rate
for 1987 would amount to a 1.8X increase.
Community Services Director Fondrick described the capital
improvements targeted for the water utility account and described
the lime sludge dewatering facility that was targeted for
construction in 1987.
Administrative Services Director Devich reviewed the
proposed Sanitary Sewer Fund Budget and recommended a 3.4~
increase in 1987. The Administrative Services Director pointed
out that the one significant cost in the Sanitary Sewer Budget is
the charge from the Metropolitan Waste Control Commission for use
or discharge into that system. In 1985 the actual cost of those
charges was $612,000. The revised 1986 budget projected cost of
$807,000 and the 1987 budget $817,500. Director Devich indicated
that the Metro sewer charge for 1987 represented 62X of the
entire sewer utility expenditure budget. Council Member Sandahl
questioned why the dramatic increase from 1985 to 1986 in the
Metro Waste Water treatment charges. Director Devich responded
that while the 1986 figure is an estimate that is reconciled
after year end by MWCC, it still was a large increase, which
would require additional contact with Metro Waste for a specific
explanation.
Budget Hearing Meeting -2- ~ September 15, 1986
Administrative Services Director Devich presented the Storm
Utility Budget. Community Services Director Fondrick highlighted
the extensive Storm Sewer Capital Improvements which were
completed in 1986 and those which were targeted for 1987.
Director Devich indicated that. the quarterly residential Storm
Sewer rate would be increased from $4.35 per quarter to $4.50 per
quarter and that other category charge classifications would be
increased a corresponding percentage amount.
Liquor Operations Director Fillmore presented the Liquor
Fund Budget. Mr. Fillmore indicated that the sales to date for
1986 were 2~ over the previous year's sales and that the final
1986 sales are projected at 3.7X over 1985 sales. Director
Fillmore also indicated that the gross margin percentage for the
liquor operations was in excess of 21X thus far for 1986 which
is well ahead of projections and the actual experience of the
liquor operation of the past several years. Mr. Fillmore stated
that in 1987, the Cedar Liquor Store would be constructed at a
cost of approximately $50.0,000 and that the cost of building the
facility would be paid for entirely out of the Liquor Fund.
Council Members commended Mr. Fillmore for the liquor operation
performance for 1986.
Administrative Services Director Devich reviewed the
proposed Municipal Golf Course Fund budget. Mr. Devich indicated
that the Municipal Golf Course in 1986 is reaching the break even
point and that the fund would start experiencing a positive cash
balance in the future. Community Services Director Fondrick
described the major improvements for 1987, including a major
modification of the driving range, and that a large mower was
purchased in 1986, due to the end of the cooperative agreement
with the Toro Company. Mr. Fondrick also reviewed the proposed
fee increase for Seniors at the golf course and recommended. an -
increase from $5.00 for an 18 hole round of golf to $7.50. He
further indicated that the Community Services Commission
recommended a $1.00 increase for 1987. for Senior and Junior
rates. It was moved by Ludeman, and seconded by Sandahl that the
rate be increased from $5.00 to $7.50 for 18 holes of golf for
1987 with the Senior rate increase. Motion passed 4-0.
Item ~~2 INTERNAL SERVICE FUND BUDGET
Administrative Services Director Devich reviewed the Central
Garage Fund Budget. Community Services Director Fondrick
reviewed the major equipment purchases for 1986 and 1987.
highlighting the snow plowing equipment which would be available
for the 1986 - 198.7 winter snow plowing season.
Budget Hearing Meeting -3- September 15, 1986
Administrative Service Director Devich reviewed the Central
Service/Data Processing and Printing/Supply funds, indicating
that $137,000 of additional Burroughs computer purchases would be
targeted for 1987. Mr. Devich also indicated that the 1987
proposed budget did not provide funding for the continuation of a
lease for the Four Phase computer system.
Administrative Services Director Devich presented a Self-
Insurance Fund. Mr. Devich indicated that the 1987 contribution
for Worker's Compensation was targeted at $125,000 and that the
fund balance of the Worker's Compensation portion of the self-
insurance account was expected to level off in the year of 1986
and 1987, due to the extremely high cost of Care of Persons
category. He also added that the 1986 budget provided for
funding for the self-insured liability insurance program created
in July 1986.
Item ~~3 DEBT SERVICE
Administrative Services Director Devich reviewed the
proposed Finance/Bonded Debt Fund Budget. Director Devich
indicated that in 1987. all but $300,000 of a general property
tax levy had been abated for the special assessment bonds.
However, he stated that the $300,000 was necessary to meet debt
obligations for 1987. Mr. Devich indicated that for the next ten
years it was anticipated that $300,000 - $350,000 would be
necessary for such annual special assessment levy. Director
Devich indicated that the tax levy for the redevelopment bond
issue had been completely abated for 1987 because there was
sufficient funding from the tax increment projects to pay the
debt service on the bonds.
Larry Wozniczka, 6744 Wentworth Avenue South, raised the
question regarding the Debt Service schedule with respect to
Housing Redevelopment Bonds. Administrative Services Director
Devich answered Mr. Wozniczka's question regardigg the schedule.
The meeting was adjourned at 9:14 P.M.
Date,~Ap~.roved : 9/22/86
~e-we u. uevicn
Actin City Clerk
ohn J Q 1 on Mayor
~ ~,
. ~/~~j f
amps D. Prosser
C~t~}r Manager