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Home My WebLink About07/12/2011 , . , ' TENTATNE AGENDA CITY OF SHAKOPEE ADJ. REGULAR SESSION SHAKOPEE, MINNESOTA � JULY 12, 2011 LOCATION: Training Room, Shakopee Police Station,475 Gorman Street, Shakopee,MN Sftaf#o�ee.M�iooiarz St.a�ernerr�E . J Pce.Miaausn o.�f,�e�y a�Sf�aPa�ee ia Ea pacauide Ef'ie appar�ufufr�ta�iue,cua�cP�auzd peacy ifz a cantmufr.i�y u�if�a p�crud paat, Pxvnu�iir.��u�e,artd amac��Eawx�atntaopffe�ce u�itPcirz a rne�ica�a.QiEa�a oef�in,�c. Mayor John J. Schmitt presiding 1] Roll Call at 7:00 p.m. 2] Approval of Agenda 3] Market Values,Tax Capacity Rates,Review of Historical Rates 4] Two Year Budget Prepaxation and Review 5] Property Tax Levies a. Review of 2011 levies b. Discussion of pending 2012 levies c. EDA levy and levy utilization ' d. Debt service levy discussion 6] Capital Improvement Levy—Public Works Discussion a. Overlay projects � 7] Review of Internal Service Fund Charges • � a. Equipment rentals b. Building facility rentals 8] Other Business 9] Adjourn to Tuesday,July 19, 201 l, at 7:00 p.m. � � OFFICIAL PROCEEDINGS OF THE CITY COUNCIL ADJ. REGULAR SESSION SHAKOPEE, MINNESOTA JULY 12, 2011 Mayor Schmitt called the meeting to order at 7:00 p.m. with Council members, Pat Heitzman, Steve ;Clay, Matt Lehman and Pamela Punt present. Also present Mark McNeill, City Administrator;R. Michael Leek, Community Development Director; Bruce Looney,Public Works Director/City _ Engineer; Julie Linni.han, Finance Director; Jeff Tate,Police Chief; Rick Coleman, Fire Chief; and Brad Ehlers, Community Center;Judith Cox;City Clerk. Mayor Schmitt asked if there were any additions or deletions to the agenda. Mark McNeill said staff had no changes to the agenda. PuntlClay moved to approve the agenda. Motion carried 5-0. Mark McNeill, City Administrator,presented Council with an outline of the 2012 Budget Workshop. .Mr.McNeill said the purpose of the workshop is to gather information and ideas regarding the 2012 �budget as well as gathering information and ideas from the newly hired Finance Director,Julie Linnihan. Julie Linnihan, Finance Director,presented the Council with the 2012 Budget Discussion. Ms. Linnihan said that because of the sta.te government shutdown, obtaining and working with accurate numbers generated by the Department of Revenue isn't possible. This means that cities and counties will not be able to obtain or develop reasonable estimates for fiscal disparities and market value . credits; and ultimately,property tax impact. Ms. Linnihan said that the City of Shakopee is very fortunate because it does not rely on LGA,maxket value homestead credit, or significant pension funding as part of the budget. She said that Shakopee's tax capacity decline for 2012 is-0.61% and is very manageable. Ms. Linnihan said there is a decline in the taxable market rate. However the tax levy and tax capacity are very stable and represent responsible decision making. Ms. Linnihan said that when reviewing�the 2012 budget, Council and staff should consider the following factors; Shakopee has a stable fund balance, consistent funding of the internal service funds, low rate of debt, strong cash position, and no reliance on significant state aid. Michael Leek, Community Development Director,presented Council with a discussion on the Economic Development Authority(EDA)levy. ' Mr. Leek stated the purpose of an EDA is to use it as a mechanism to provide assistance to or �economic development incentives for the grovcrth of the business tax base within the community. Mr. Leek said that the EDA ad hoc committee thought it is very critical that the City position itself because other area communities were also being proactive in economic development. Mr. Leek said the EDAC (Economic Development Advisory Committee)has given Council a number of recommendations about potential funding mechanisms or financing tools that should be considered. ,. �. Official Proceedings of the ' June 12,2011 � Shakopee City Council Page-2- Mr. Leek said that the key to the EDA levy is the intention of the Council as to the purpose of the EDA levy. Mr. Leek asked Council if their intentions are to follow the recommendations of the EDAC to expand the existing loan program or to provide more GAP financing for businesses, etc. Mr. Leek said these are just some of the questions Council will need to consider when establishing the 2012 budget. Ms. Linnihan said that she cannot find a policy on the use of EDA funds and that a policy needs to be determined so that staff will laiow how to respond to requests. Mayor Schmitt identified possibilities for financing tools for the preservation, expansion and creation of businesses: SAC (sewer availability charge) credits,tax abatement,taa�increment financing and DEED (Department of Employment and Economic Development). He said that the EDA needs to quantify what is in the tool box. Ms. Linnihan said that the City has a low debt situation. She also stated that the City l�as been in a cash position to reduce or cancel some annual debt service levies. As she reviewed it and looked at the .process that occurs,it may be time to review and bring some of the debt service levies back into the total levy. Bruce Loney, Public Works Director/City Engineer discussed the Capital Improvement Levy. Mr. Loney said that the City probably won't be able to rely on state aid to pay for future street overlays. In 2006 a report was prepared on pavement ma.nagement. Mr. Loney reminded the Council that between 1995 and 2006 45% of the city streets were constructed. The City may have to levy for future projects or put some money in the capital improvement fund. Discussion followed. Ms. Linnihan said that Council should consider the amount of money the City would want to commit to the infrastructure of the community a.nd the priority it has in the budget; and, this might be a good time to look at this. She identified options for funding infrastructure: an improvement levy or partial assessments. Ms. Linnihan then discussed the two year budget prepazation and review. Ms. Linnihan said she would like to explore going back to the one year budget planning rather than a two year budget. She feels that there is more accuracy and details in a one year budget than trying to anticipate figures"for a two year budget. In support of a one year budget,Mr. Leek noted the uncertainty of future transit funding; and, Mr. McNeill noted the need for discussion on the cost of living adjustments and union contracts. Consensus of council members was to prepare a one year budget. Ms. Linnihan then presented discussion on the Internal Service Fund. She said that in meetings with the various,departments regarding equipment rental and building facility rental, discussion centered around if the formula to determine these rates should be reviewed. She feels that the Internal Service Fund needs to be discussed in great detail with each of the departments to make sure it's accurate, comprehensive and concise so that the numbers that are used provide actual funding for what is ultimately needed. She is recommending mai.ntaining the 2012 levels at the 2011 rates to provide ample time for review. Mr. McNeill reminded Council of an additional workshop meeting previously scheduled for Wednesday, July 27, 2011. Lehman/Heitzman moved to adjourn to Tuesday, July 19, 2011 at 7:00 p.m. Motion carried 5-0. Official Proceedings of the June 12,2011 Shakopee City Council . Page-3- The Council meeting enc�ed at 8:45 p.m. ` � . /, _ � � • ��j� J dith S. Cox � City Clerk ' Kim Weclanan Recording Secretary