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HomeMy WebLinkAboutMinutes-3/05/2015March 5, 2015 The Council of the City of Waterloo, Iowa, met in Special Session at Harold E. Getty Council Chambers, Waterloo, Iowa, at 4:00 p.m., on Thursday, March 5, 2015. Mayor Ernest G. Clark in the Chair. Roll Call: Cole, Jones, Schmitt, Lind, Morrissey, Welper, and Hart. 144225 - Hart/Schmitt that the Agenda, as proposed, for the Special Session on Thursday, March 5, 2015, at 4:00 p.m., be accepted and approved. Ayes: Seven. Motion carried. Michelle Weidner, Chief Financial Officer (CFO), reviewed the FY2016 budget process, the City of Waterloo mission and priorities, and how and what tax dollars are used for. Mr. Lind questioned if debt could be paid down by using the reserve and savings from the health insurance benefit. Michelle Weidner, CFO, explained why the fund balance restricted for health claims cannot be used for other purposes due to the restricted levies used for this benefit. Diverting that money is not an option. Mr. Jones questioned if the state corporate roll back is a net zero. Michelle Weidner, CFO, explained that it is not exactly. There is a complex formula. She explained the appropriations from the State. Mr. Schmitt questioned the State reimbursement and it was explained that it is close to dollar for dollar. He questioned the idea of healthcare funds being restricted. Michelle Weidner, CFO, explained how closely healthcare funds are monitored because since the City is self-insured, we are working with estimates and not actual premium dollar amounts. It was explained that the budget is extremely conservative in this area because of funding needs. Mr. Morrissey questioned to what the health care decrease could be attributed. Michelle Weidner, CFO, explained that it could be reductions in claims and costs passed on by vendors or possibly due to Healthcare reform effects on large employers. Suzy Schares, City Clerk, explained that at least a portion of this decrease is due to the better rates and contractor discounts the City received in January 2014 when the City switched to Wellmark as well as a larger portion of the expense is now falling back to the employees with the plan design changes that have happened over the past four years. The employees are paying more. Mr. Lind questioned why we are spending the money saved instead of lowering taxes. Michelle Weidner, CFO, explained that the total tax asking is being lowered. The money saved is offsetting increased expenses in other areas. Mr. Hart explained that the levy rate has been reduced for the last two years. Michelle Weidner, CFO, stated that the current levy rate is the second lowest it has been in the last ten years. Mr. Lind stated that it is still the highest in the state for large cities. Michelle Weidner, CFO, stated that she could not confirm if the rate was, in fact, the highest. Ms. Cole clarified that the money budgeted to be used from fund balance has not actually been used at the rate proposed. Ms. Cole questioned whether or not the City has ever spent the entire amount in the fund balance. Michelle Weidner, CFO, stated that they have budgeted to use fund balances twice in years past and balances fluctuate from year to year. Mr. Jones questioned what next year is going to look like and if we will need to use fund balance. March 5, 2015 Page 2 Michelle Weidner, CFO, explained that property values are expected to hold steady and the protests from 2011 should be close to done although, it is hard to tell at this point. There is an expected increase of $1 million in expenses. Additional revenue sources will need to be found. Mr. Schmitt presented a PowerPoint showing the history of revenue and expenditures in the City. He suggested not utilizing reserves, not utilizing the state rollback, 411 pension reduction, and healthcare savings to reduce the budget. He also suggested no layoffs and no service cuts. He asked that insurance be bid out each year, animal control work with the Humane Society, and expressed concern with the rate at which landlord licenses were being issued and the revenue being received. He explained that he and a few other Councilmembers have been meeting with the Humane Society to try and find a solution. Mr. Hart noted that he had extensive conversations with the Cedar Bend Humane Society as well. A brief recess 5:53 p.m. to 6:00 p.m. PUBLIC HEARINGS 144226 - Hart/Morrissey that proof of publication of notice of public hearing on the FYE2016 Budget, as published in the Waterloo Courier on February 20, 2015, be received and placed on file. Voice vote -Ayes: Seven. Motion carried. This being the time and place of public hearing, the Mayor called for written and oral objections. Suzy Schares, City Clerk, stated that there were some written objections on file in the Clerk's Office. Michelle Weidner, Chief Financial Officer, reviewed the fund balance use and growth over the last six years. Steve Murphy, 124 Terrace Dr., expressed concern with the tax levy rate and increased fees and the impact on economic growth. He expressed concern with the lack of transparency during the budget process. The Mayor explained this year's budget process. Bill Kammeyer, 526 Home Park Blvd., expressed concern with not getting questions answered although, stated the information being presented was being done in a transparent manner. Forest Dillavou, 1725 Huntington Road, expressed concern with the increased taxes and fees. Bob Reisinger, 310 W. Park Ln., spoke on behalf of Chris Fischels, President Board of Realtors, spoke in support of lowering taxes and increasing the tax base. Jim Chapman, 224 Bertch, spoke in support of not raising the tax levy. 144227 - Hart/Morrissey that the hearing be closed and oral and written comments be received and placed on file. Voice vote -Ayes: Seven. Motion carried. 144228 - Hart/Welper that "Resolution approving said budget with a total tax levy rate of $17.76370 and total property tax askings of $40,151,726", be adopted. Roll call vote -Ayes: Four. Pat Treloar, Chief of Fire Services, expressed concern with the response time when Station 6 is closed. Mr. Schmitt clarified and accepted correction to his understanding of the history of Fire Services staffing issues over the past fiscal year. Mayor Clark announced that there will be another deployment in October 2015 that will affect Fire Services at the beginning of FYE2016. Mr. Jones questioned if funding is approved for the additional positions would the City still be seeking grant funding for additional positions. March 5, 2015 Page 3 Pat Treloar, Chief of Fire Services, explained that the SAFER grant application requesting three additional positions for a two year period has been submitted and they anticipate a decision by as early as July 2015. Chief Treloar went on to explain some of the requirements and waivers associated with that grant. Mr. Lind requested review of the Round 2 line item adjustments added March 4, 2015. Mr. Hart noted that he asked for these adjustments after speaking to departments. Michelle Weidner, CFO, reviewed the additional reductions applied to the line items on March 4, 2015. Paul Huting, Director of Leisure Services, provided detailed information relating to the reductions relating to wages paid to part-time employees. Mr. Hart stated that his hopes would be that the council could have conversations regarding some of the smaller lots that the city owns so that the city wouldn't have to pay to maintain them in the next fiscal year. Mr. Jones questioned how much growth is needed to make up for the necessary $1.5 million next year. Michelle Weidner, Chief Financial Officer, reported that there would have to be at least $50 million in taxable growth. Noel Anderson, Community Planning and Development Director, explained that it would need to be in non -TIF areas and in residential areas in order for the growth to affect our bottom line. The residential growth would have had to have happened three years prior due to the CLURA. Mr. Jones questioned the idea of immediate funding of future increases by growth of new residential properties outside of TIF area. Noel Anderson, Community Planning and Development Director, stated that this would be correct along with obtaining new, larger projects within the TIF district. Mr. Lind stated that this $50 million in growth would only be realized with the addition of one hundred fifty $333,000 homes outside TIF district eligible for taxation immediately. Michelle Weidner, Chief Financial Officer, stated that would be true if the city were looking at property tax as the only source of income for the city. Mr. Jones questioned how the City's levy rate impacts economic development. Noel Anderson, Community Planning and Development Director, explained that there are several factors considered but the higher levy rate does not help. He stated that he believed there have been 60 non -retail positions created. Mayor Clark noted that this proposed budget does reduce the levy rate from last fiscal year. Mr. Jones expressed concern with adding new positions and asked how the levy rate compares to the neighboring cities and how that is seen by companies looking to settle somewhere in the Cedar Valley. Noel Anderson, Community Planning and Development Director, explained that the levy rate is brought up frequently when speaking to these companies. The City has used reductions in taxes to attract some companies. Mayor Clark noted that there is not a lack of companies looking at moving to Waterloo. Mr. Jones asked how reclassification of multi -residential properties might affect the city's future tax revenue. Michelle Weidner, Chief Financial Officer, explained that there is a new category for multi -family properties and they will eventually be taxed at same rate as a residential property. The impact has yet to be calculated, due to the information not being available yet. Mr. Morrissey announced that there are senior and disabled property tax credits available and the forms are available online and at the County Courthouse. Mr. Schmitt passed out a document showing the levy rates for cities around the state and spoke about what other cities are doing to reduce their levy rate. March 5, 2015 Page 4 Mr. Lind suggested paying down debt and continuing to save. Mr. Schmitt stated that the City of Waterloo needs to be proactive as we anticipate future budgets. Mr. Welper stated that in his fourteenth year of budget hearings, this is the easiest of the decisions he's had to make in supporting this budget. He also commended the Mayor and the department heads for stepping up and offering to provide the same services to the city with fewer resources to provide them. Mr. Hart stated that, in the past two years, council has been given greater opportunity to give input into this process than in previous years. He also expressed his gratitude for the cooperation of all involved who were willing to offer input during this long process. Mr. Morrissey expressed the desire to exude a positive attitude toward the future of the City of Waterloo. Roll -call vote: Ayes: Four. Nays: Three. (Jones, Schmitt, Lind.) Resolution adopted and upon approval by Mayor assigned No. 2015-164. 144229 - Hart/Welper that "Resolution approving a 3.0% salary increase for non -bargaining employees plus suggested salary equalization increases, effective July 1, 2015", be adopted. Roll call vote -Ayes: Four. Nays: Three (Jones, Schmitt, Lind). Motion carried. 144230 - Lind/Schmitt to separate the non -bargaining salary increase and salary equalization resolution into two separate resolutions. Ayes: Three. Nays: Four (Morrissey, Welper, Hart, Cole). Motion failed. Mr. Hart asked for clarification that this resolution is included in the approved FYE2016 budget and is not in addition to it. Mayor Clark affirmed this to be correct. Mr. Jones asked to have a third party review the data on the equalization process. Suzy Schares, City Clerk, stated that hiring a third party to do this review tends to be quite expensive and we would need to identify funds in order to pay for this service. Mr. Lind expressed concern with the wage equalization process. Suzy Schares, City Clerk, explained the process. Resolution adopted and upon approval by Mayor assigned No. 2015-165. ADJOURNMENT 144231 - Hart/Schmitt that the Council adjourn at 7:20 p.m. Voice vote -Ayes: Seven. Motion carried. Suzy S ares, CMC City C1-rk/Human Resource Director