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HomeMy WebLinkAbout03.01.2004• COUNCIL WORK SESSION March 1, 2004 3:00 p.m. Council Chambers Members present: Mayor Hurley, Kincaid, Cole, Greenwood, Clark, Schmitt, Gunderson, Welper. Moved by Welper, seconded by Gunderson that the Agenda, as proposed, be approved. Ayes: Seven. Motion carried. The council discussed the proposed FY05 Budget. Mayor Hurley stated the fact is we should be asking a minimum of $33.7 million in property taxes collected for FY05 to operate the city. Mayor Hurley reported that personnel costs (salaries, health insurance, overtime, etc.) are $24.7 million or 74 percent of every general fund dollar the city collects is for personnel costs. Mayor Hurley stated he doesn't believe there are a lot of items we buy or purchases or contracts that we can go after. Health insurance is 11 percent of $33 million, part-time and temporary employees is $706,000 of the general fund, overtime is $540,000, including double time, which is $1.2 million if we don't approve any overtime or hire any part-time employees. Mayor Hurley stated he would need an impact statement from every department head on how that would impact his/her department. Some department heads have resorted to part-time help. Mayor Hurley stated it looks likes both part-time and overtime is about 1 percent of straight salaries. Michelle Weidner, Chief Financial Officer, reviewed the Property Tax Changes at Proposed Rates. The form shows proposed levy rates, reduction of number of positions, reduction required from requests and change for residential, commercial and industrial property. Councilperson Welper stated he doesn't think the city can afford to lose any more people, and the city couldn't even operate as a city with a reduction of 28 positions. Mayor Hurley reported that the Airport and Five Sullivan Brothers Convention Center has been moved from the $8.10 levy, and we have also applied the emergency levy. Mayor Hurley stated the only place to reasonably attack is the $8.10 levy, as we are maxed out in the Library Levy and the Met Transit is pretty close to maxed. Ms. Weidner reminded council that we could reduce employee benefits if we cut from the $8.10 levy. Councilperson Welper stated to our citizens safety is more important than anything else. Councilperson Welper stated he is prepared to cut any programs to maintain public safety to where we are today. Councilperson Schmitt suggested using option 3 and Mayor Hurley's suggested cuts, which would leave us about $350,000 short, but we could reduce overtime and part-time to reach that amount. Paul Huting, Leisure Services Director, reported that the part-time positions at Young Arena sell concessions and there is a good return on those people. Mr. Huting stated we could lose more revenue than dollars saved by cutting part-time help. Mr. Huting stated that with the part-time people running the sports programs we would see a saving of 30 to 50 percent, and would see a drop in expense but also a drop in revenues. Councilperson Welper asked without police and fire overtime how will we pay people to do the work. Mayor Hurley responded that we just don't respond as quickly or patrol the neighborhoods as often or perform inspections. The services would still remain, but the frequency would change. Councilperson Greenwood stated he would be interested in looking at total tax collected rather than the levy. Councilperson Greenwood stated if we find that we need $32 million for our Council Work Session March 1, 2004 Page 2 people and the City of Dubuque is 10 percent more or less we could see if we are in the ballpark as to what other cities are doing. Councilperson Greenwood stated this would give him a comfort level as to whether the city is spending too much or not enough. Councilperson Gunderson asked how many vacancies do we have in authorized positions. Ms. Weidner responded there are about seven, with five in the Fire Department, one construction position in Leisure Services and a Financial Analyst. We have two employees on military leave that will have to be reinstated when they return. An informal poll was taken of council as to what levy rate they would be comfortable. Councilperson Schmitt favors Level 3, Councilpersons Clark, Welper, Kincaid and Greenwood favor Level 4, Councilperson Gunderson favors Level 2 and Councilperson Cole would go with Level 3 or Level 4. Councilperson Greenwood asked if the Police and Fire Pension increase has been budgeted for next year. Ms. Weidner responded we have not budgeted for FY06 yet. Mayor Hurley stated there are rumors the city's portion of the pension could go to 30 percent of straight time. Ms. Weidner reminded council members that using Mayor Hurley's proposed $600,000 reductions, we still need to reduce the departments asking by another $400,000 if council uses option 4. Councilperson Greenwood asked if this includes bonding for frozen sick leave. Ms. Weidner stated that last year we estimated we would issue $500,000 in short-term debt to fund sick leave. According to budgets received from the departments, we will need $150,000 so we could bond for that which is less than FY04. Lou Cutwright, Building Official/Maintenance Administrator, reminded the council that several programs were started as a result of the construction community increasing building fees to pay for those programs even though total permit fees pay for the Building Department and they return funds to the general fund. Mr. Cutwright stated if we look at a reduction of inspectors we will have to look at a reduction in permits and possible loss of $70,000 to $80,000 revenues because of inspection contract with Black Hawk County and LaPorte City. Councilperson Clark asked if there is an equitable way of using option 4 and then arriving at a percent so each department is cut relatively the same. Ms. Weidner responded she doesn't feel we should do a percentage across the board as there are some line items on the spread sheets that we could not do that. Paul Huting, Leisure Services Director, stated as a department head he would rather be given a dollar amount. Ms. Weidner stated that the departments have cut for so many years she is not certain they can continue cutting because they have been asked to cut for the past decade. Councilperson Welper asked if the city needs to be in the golf business, maybe we could lease the golf courses. Mr. Huting responded that historically the golf course break even, but the city could lease them out to private entities because some times there is cash up front, but we may see course conditions decline over the years. We would also have to look at the pros contracts. Mayor Hurley stated as a body the council is close to the $18.909 levy which represents 5.76 percent increase for residential property and 17.11 percent for commercial property. Mayor Hurley stated he wants to look for every dollar in travel, goods and services before looking at employees. Councilperson Gunderson stated he doesn't see how we can absorb 21 positions without affecting police and fire. Councilperson Welper asked what the ball park is worth and can we sell it. Mayor Hurley responded that income would not help us for next year. • • Council Work Session March 1, 2004 Page 3 Mayor Hurley and Council Member reported they have been hearing from citizens not to raise taxes. Some asks not to raise taxes but keep the same level of services. Councilperson Greenwood commented that we always hear from people that they don't want their taxes raised, but there could be a silent majority who want four minute response time and good quality parks. Councilperson Greenwood commented that reviewing the election results, Mayor Hurley's opponents wanted to cut taxes and Mayor Hurley wanted to save public safety and garnered the votes. Councilperson Greenwood stated he feels if the council tries its best, keeps good quality of life and keeps services, then they will have done a good job. Ms. Weidner reviewed the Civic Center Levy. Ms. Weidner stated that cities can levy a separate levy for maintenance of civic centers. We are currently using hotel/motel taxes and issue some bonds for remodeling. The state law provides how we can use hotel/motel tax. Fifty percent of hotel/motel taxes collected must be used for tourism type things, the other 50 percent collected is not restricted. Our ordinance states we will use 100 percent of the hotel/motel taxes collected for tourism and related expenses. The Five Sullivan Brothers is listed to receive $150,000 for maintenance of the building. We could use 50 percent of the hotel/motel tax to offset the general fund which would have $350,000 affect on the $8.10 levy or approximately seven positions. The current ordinance allocates 50 percent to the Convention & Visitors Bureau, 20 percent for the Five Sullivan Brothers Convention Center, 20 percent for the tax grant and 10 percent for council's discretionary fund. Ms. Weidner commented we could continue to use those percents, but only on one-half of the amount received, which could be a hardship on the Convention & Visitors Bureau. We may hear from those organizations on why they need to continue to be funded. We collect the maximum allowed, which is seven percent, but there is a bill in the Senate which would raise that amount to nine percent, but that may be earmarked for countywide. Councilperson Clark stated he is opposed to changing the hotel/motel tax ordinance and using those funds to fund the general fund. Councilperson Clark stated he feels quality of life is essential for cities to survive, and the hotel/motel tax was designed to fund those kinds of activities. With no further business before the council, it was moved by Clark, seconded by Welper that the meeting be adjourned at 4:10 p.m. Ayes: Seven. Motion carried. Nancy Eckert City Clerk