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HomeMy WebLinkAbout10/13/1992 TENTATIVE AGENDA SHAKOPEE, MINNESOTA COMMITTEE OF THE WHOLE OCTOBER 13 , 1992 Mayor Laurent presiding 1] Roll Call at 8 : 00 P.M. 2] Approval of the Minutes of September 29, 1992 3] 1993 Proposed Budget - bring previous information 4 ] Set Next Committee of the Whole Meeting Date - if needed 5] Adjourn. Dennis R. Kraft City Administrator OFFICIAL PROCEEDINGS OF THE CITY COUNCIL COMMITTEE OF THE WHOLE SHAKOPEE, MINNESOTA SEPTEMBER 29, 1992 Mayor Laurent called the meeting to order at 7 : 06 P.M. with Councilmembers Joan Lynch, Robert Sweeney, Gloria Vierling, and Mike Beard present. Also present were Dennis R. Kraft, City Administrator; Barry Stock, Asst. City Administrator; Karen Marty, City Attorney; and Judith S. Cox, City Clerk. Sweeney/Lynch moved to approve the minutes of August 25, 1992 and September 8, 1992 . Motion carried unanimously. Mr. Bill Rudnicki, William Engelhardt Associates, Inc. , passed out floor plans for the proposed Shakopee Mdewakanton Sioux Community Recreation Center. He stated that he was present to get feed back on Shakopee ' s community survey and on the proposed recreation center. He explained the different activities provided for within the Center. He responded to questions from Councilmembers. He explained that a site had not yet been selected, but that the proposed Center would need about 10 acres. He explained that the proposed Center was 125, 000 sq ft and is a little larger than the Chaska Community Center and that there are no meeting rooms. Mr. Rudnicki explained that there was a vote taken to approve the funding for a fitness and recreation center from the Community as a whole. The next step is to determine how to fund the Center, where it will be located, and how it will be used. Mayor Laurent thanked Mr. Rudnicki for coming. The Committee of the Whole took a recess from 7 : 33 P.M. until 7 :45 P.M. to wait for the next presenter. Mr. Bill Morris, Decision Resources, passed out the results of the community survey recently conducted. He explained that 400 residents were surveyed, that the refusal rate was only 3%, and that the average time spent on the phone was 42 minutes. He went on to explain the results of the survey using pie charts. Mr. Morris presented results on all 168 questions. Just to name a few: 87% feel that the quality of life in Shakopee is excellent and good. A senior center and an indoor ice arena jump out as current facilities insufficient to meet demands. Priority for recreational funding is for the youth over adult programs. The majority would support a $20 tax increase to acquire land for future recreation activities. 68% favor the concept of a community center and $50 would be bearable to most. 56% of those called shop downtown and if access and parking were improved additional shoppers would shop downtown. 65% called favor using development incentives to improve the downtown. 43% favor using any surplus funds for lowering taxes. Official Proceedings of the September 29 , 1992 Committee of the Whole Page - 2 The reasons for moving to Shakopee were unusually high for jobs (25%) and family/grew up here (14%) . 60% favored increasing property taxes to maintain the current services. 40% feel that taxes are higher than in other communities and 27% feel they are average. This is normal for the metro area. 69% feel that the services provided are excellent or good. Services needing improvement are animal control and code enforcement. 55% feel that development within the community is well planned. The pace of development is: 34% just right, 22% not fast enough. 73% would like to see a City Newsletter. Mr. Morris summarized the results stating that residents are content with most things going on in the community. Residents are selective on what they want for recreational activities. The community center attracted attention. Residents are willing to support a community center, but don ' t want to spend more than $50; and are willing to support some tax increase to acquire land. An issue within the community confirmed time and time again is the traffic problem. Mr. Morris stated that this was one of the most positive reports that he has had within the past 12 months. Mr. Morris stated that 403 people were talked with and that the accuracy of the survey is plus/minus 5%. Mr. Morris stated that he will be providing Council with copies of the pie charts and with an executive summary. Mayor Laurent thanked Mr. Morris for his professional presentation. The meeting adjourned at 8 : 58 P.M. 111W vc);Itki c• ith S. Cox ty Clerk Recording Secretary TO: Dennis R. Kraft, City Administrator FROM: Gregg Voxland, Finance Director RE: 1993 Revenue Issues DATE: October 9, 1992 Introduction I am recommending that Council review the rates for sanitary sewer and storm drainage utilities for 1993. Background The city started billing storm drainage in 1986 and the city wide rate has not been changed since inception. The sanitary sewer rate has not changed since at least 1985. Sanitary Sewer The Sanitary Sewer Fund ended 1991 with $1,757,000 in cash on hand but had an operating loss of $38,000. Interest income did enable the fund to have a positive net income of $115,000 for the year. Operating income, net income and revenues have had a downward trend over the past four years. See attachment A . One factor has been the conservation efforts of Rahr. The cost of treatment has also fluctuated based on the operation of MWCC. The sewer revenues or rate is composed of two parts. One part is the monthly or quarterly charge which is currently $3.00 per month of $9.00 per quarter just to be connected to the system. Years ago Council intended this part of the rate to cover the non-MWCC costs of the utility. over the past number of years, previous councils have held the monthly charge the same in order to minimize the cost impact on the small residential user with low flows. The other part of the sewer rate is the flow charge based on water used or measured sewer flow. Residential customers are based on water used in the period of Sept - March. Changes in the flow part of the sewer rate impact larger uses (commercial and industrial) more than residential users. The current flow rate is $1.22 per thousand gallons. The "average" residential account uses 5,000 gallons per month for a flow charge of $6.10 plus the monthly charge of $3.00 for a total monthly sewer bill of $9.10. There are 3,420 sewer accounts. Raising the monthly charge by one dollar will generate $41,000 in additional revenue. The impact on the average monthly residential bill will be a 11% increase or $1.00 more than the $9.10. Raising the flow charge by one cent will generate about $7,800 in additional revenue. The impact on the average residential bill would be one half of a percent or $0.05 more than the $9.10 per month. On the other end of the scale, Rahr is the largest account and the flow part of the rate would cost them about an additional $210 per one cent increase per month. The projects in the 1993 CIP show a cash outlay from the Sewer Fund in the amount of $805,000 including the Rahr force main. The fund can probably make it through 1993 with an acceptable cash position but the following years are uncertain. Storm Drainage The city wide fee is currently $13.76 per R.E.F. per year and generates about $269,000 per year from about 4,000 accounts. TIF financing was used to pay for some of the first big projects and as a result, the utility fees are to have been saved up to finance the later projects. The funding structure of the storm drainage fund is somewhat complex and a discussion with the City Engineer and Council is warranted. The Storm Fund ended 1991 with $1,436,000 in cash and operating income of $134,000 with net income of $245,000. Project costs for 1993 are only $205,000. Alternatives 1. Increase sanitary sewer monthly charge. 2. Increase sanitary sewer flow charge. 3. Increase storm drainage city wide fee. Recommendation Storm drainage = discuss and give staff direction on future funding approaches for this utility. Sanitary sewer = increase either the flat fee part of the rate or the flow charge or a combination of the two. Minnetonka is currently doing a survey that may provide helpful information on what part of the rate to increase. Actual change in the rates will be set by the adoption of the annual fee resolution in December. Action Requested Discuss and give staff direction. A CITY OF SHAKOPEE, MINNESOTA SEWER FUND STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS 1991 1990 1989 1988 Operating Revenue Sewer Service Charges $1,079,640 $1,153,840 $1,221,308 $1,272,658 Operating Expense Personal Services 13,610 22,936 20,704 25,073 Supplies And Services 52,066 32,156 34,853 28,538 Treatment Charges 965,176 983,134 904,611 962,781 Depreciation 87,222 81,767 80,812 68,756 Total Operating Expense 1,118,074 1,119,993 1,040,980 1,085,148 Operating Income (Loss) (38,434) 33,847 180,328 187,510 Add: Non-Operating Revenue Interest Income 154,481 147,619 159,249 108,924 Less: Non-Operating Expense Interest Expense (583) (7,095) (8,259) (9,055) Net Income To Retained Earnings 115,464 174,371 331,318 287,379 Retained Earnings - January 1 2,264,206 2,089,835 1,758,517 1,471,138 Retained Earnings - December 31 $2,379,670 $2,264,206 $2,089,835 $1,758,517 i CITY OF SHAKOPEE, MINNESOTA STORM DRAINAGE FUND STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS 1991 1990 1989 1988 Operating Revenue Service Charges $ 299,012 $ 296,033 $ 288,540 $ 276,455 Operating Expense Personal Services 30,290 35,412 35,570 29,335 Supplies And Services 14,160 18,210 16,028 16,122 Depreciation 120,408 118,287 113,522 104,183 Total Operating Expense 164,858 171,909 165,120 149,640 Operating Income 134,154 124,124 123,420 126,815 Add: Non-Operating Revenue Interest Income 110,620 83,042 74,279 35,977 Net Income To Retained Earnings 244,774 207,166 197,699 162,792 Retained Earnings - January 1 881,821 674,655 476,956 314,164 Retained Earnings - December 31 $1,126,595 $ 881,821 $ 674,655 $ 476,956 TO: Dennis R. Kraft, City Administrator FROM: Gregg Voxland, Finance Director RE: General Fund Revenues DATE: October 13, 1992 A possible source of revenue for the General Fund that Council may want to consider is the enterprise funds. The sanitary sewer and storm drainage funds are enterprise supported by user fees. Some of the employees that do work for the funds charge time to the funds. There are other employees that do not charge time to the funds (i.e. Administrator, Clerk, etc. ) or general overhead expenses are not charged. It would seem reasonable to charge each of these fund an amount to recover some of the overhead expenses. A suggested amount is in the range of $5,000 to $10,000 for each of the funds. Any such fee charged would be an expense of the fund and a revenue to the General Fund.