1. Call to Order. The budget workshop session of the Council of the City of Rogers was called to order by Mayor Grimm on Tuesday, August 23, 2011 at 5:50 p.m. at Rogers Community Center, 21201 Memorial Drive, Rogers, MN, 55374.
Council present: Rob Bell, Jay Bunting, Jason Grimm, and Maureen Stanley.
Members absent: Rick Ihli.
Staff present: Stacy Doboszenski, Assistant City Administrator; Brad Feist, Fire Chief; Mike Miller, Police Captain; John Seifert, Public Works Supt.; Steve Stahmer, City Administrator; and Lisa Wieland, Finance Director.
2. 2012 Budget Discussion
Administrator Stahmer opened the meeting to discuss the unknown factors surrounding the 2012 preliminary levy; annexation phase-in, zero levy by Hassan, and date of annexation.
Stahmer then reviewed the various items impacting the 2012 budget:
• TIF 1 tax capacity
• Reduction in excess rate TIF
• Cabela's abatement
• Intentional use of fund balance; done in 2011, not planned for 2012
• Net increase in debt service; new equipment certificate twice the cost of the one coming off – purchase of fire truck with non-pull tab revenue
• Reduction in fire contract revenue because of loss in market value
• 2012 is the first year levying for the public works building debt
Stahmer stated all the items listed will result in a 27 to 28% levy increase, however the tax rate remains flat because of the increase in tax capacity (TIF 1 expiring).
Stahmer then discussed service level and staffing impacts to the preliminary 2012 budget:
• Investigator and officer back-fill not included (as was included in 2011)
• An additional officer for the Hassan annexation; Hassan has this included in their preliminary budget, therefore not included in ours at this time
• Build-out of Hassan Town Hall included in Hassan's budget
• Some shifting within public works and parks and additional hours in parks part-time wages because of additional service area and demand for service
• Reclassification of a public works employee
• Small restructuring with the Deputy Clerk going to five days per week and the community room coordinator down to four. Deputy Clerk primarily assisting the contracted planner.
• MS4 full-time position in storm sewer enterprise fund (Seifert to explain position)
• Senior programming dollars are included along with some revenues coming from their 501c3. Discussion on a senior programmer and congregate dining. Looking to offset that by a reduction in community education budget and programming.
• Fuel cost increase
Stahmer stated staff wants to avoid discussion on specifics on dollars for wages and there is mediation coming scheduled in September for the contract. Stahmer stated the draft budget does include some assumptions with both and non- wage modifications.
Council and staff then reviewed a Financial Management Plan (FMP); the plan assumes the four-year phase-in and 95% levy by Hassan. Other scenarios that have been reviewed and prepared by staff are a Rogers only budget/levy and a No Agreement with Hassan scenario. We will know by September 6th if Hassan will be considering a zero levy or a 95% levy.
Finance Director Wieland reviewed a summary of revenues and expenses in the general fund with Council. Wieland stated we are not growing the cost of business as the budget has increased by only .64%; the cost of doing business is staying flat.
Bell asked for an apples-to-apples comparison; this year to last year. Wieland explained the differences stating the 2012 budget is only a $38,000 increase over 2011. Wieland continued through her review of the FMP.
Staff and Council discussed tax capacity, fiscal disparities contribution, and fiscal disparities distribution.
Wieland explained if staff were to budget for Rogers only (not a merged community) the preliminary tax rate would be 40.471%. Wieland then informed Council how bumping tax rates up and down affects fiscal disparities.
Wieland stated expenses less revenues less a 95% Hassan levy equals the amount needed to levy; $3,796,301.
Wieland continued through her review of the FMP and budget documents. Wieland stated staff has prepared documents if there were the case of no agreement illustrating what we would do if Hassan does a zero levy. Wieland reviewed changes that could be made to the FMP that would have as little impact on our residents as possible.
Wieland informed Council staff has prepared budget documents for a zero levy and a no fund balance situation should Hassan set a zero levy and expend fund balance. In that scenario, there would need to be some sacrifices and postponements in the FMP.
Bunting stated he wants the yard waste recycling back in for 2012. Grimm agrees with adding back in the Lynde yard waste drop-off service.
Council consensus was yes to a flat tax rate and yes to minimal impact to Rogers' residents.
Bunting moved, Bell seconded a motion to adjourn at 6:48 p.m.
Stacy Doboszenski, Assistant City Administrator/Clerk