6.7. SR 11-15-2004
Item 6.7.a.
MEMORANDUM
FROM:
Mayor and Council
Pat Klaers, City Admi:W~~
November IS, 2004
TO:
DATE:
SUBJECT:
Consider Enterprise Fund Budgets
The city has three enterprise funds under its management. These funds are the garbage
collection/recycling program, the municipal liquor operations, and the wastewater treatment
system (WWTS). Attached for your review and consideration are the details for these three
programs. Additional comments on these programs are offered below.
MUNICIPAL LlOUOR OPERATION
The municipal liquor store is a very important financial resource for the city. In 2005 the city
will transfer $195,000 from the liquor store to the general fund to help finance general
municipal services. Additionally, for the past ten years the city has transferred approximately
$38,000 per year out of the liquor store fund to help pay for the 1993 City Hall building
project and this will continue until the debt is paid off.
The biggest change in the 2005 municipal liquor operations budget is that a second store is
planned to be constructed and in business by the end of the year. Construction of
Westbound is an exciting challenge. Westbound will be located in the northwest quadrant of
the Highway 10 and Joplin Avenue signalized intersection. It will take awhile (a year or
more) to get a true sense of the operating expenditures and revenues with two stores. In fact,
the new store will only be open for a few months in 2005, so when we do the budget next
year we will still have no real track record to use as a basis for the 2006 budget.
There are minimal changes being projected in the municipal liquor operations budget as
Westbound will only be open for a few months in 2005. With the addition of this second
store, one additional full-time employee is anticipated to be hired in 2005. Expenditures will
be slightly higher in 2005 based on a second srore being opened. However, with a srore not
scheduled to be opened until October 2005, the overall revenues and expenditures are both
very similar in 2005 as compared to the adopted 2004 budget.
S:\FINAIVCE\BUDGET\2004Budge!forPaffina\ENIFLWDS. DOC
WASTEWATER TREATMENT SYSTEM (WWTSI
Currently the Treatment Plant has the capacity of 1.7 million gallons per day (mgd). Plans in
the not too distant future call for the Plant to be expanded to handle 2.1 mdg. This will cost
approximately $1 million. Bonds will have to be issued for this project or else funding will
come from the city reserves. Currently the city is srill paying on the 1996 plant expansion.
These bonds will be paid off in 2016.
After the Plant is expanded to 2.1 mgd, then the next project calls for the Plant to go from
2.1. mgd to 3.0 mgd. This project is anticipated within the 2012-15 time frame. In order to
help fmance this expenditure, SAC fees need to be increased. It is proposed that the SAC
goes to $2,500 per unit in 2005 and to $3,000 per unit in 2006. Please see the attached memo
from the city engineer regarding this proposed increase.
It should be noted that the digester cover project, which is an approximately $750,000
project, is scheduled to be completed in later 2004 or early 2005. A second significant capital
improvement is planned in 2005. This is the headworks project and it is expected that this
project will cost between $1-1.5 million. This project is not in the operating budget and is
identified in the capital improvement program. Funding for this project will come out of
WWTS reserves.
Garbae-e CollectionlRecycline- Pro~ram
The proposed 2005 garbage/recycling program has no changes of significance as compared
to 2004. There are no rate changes being proposed and no increased payments to the haulers
is being considered. The five year contract with the two haulers, BFI and Randy's Sanitation,
is being renewed and will expire in October 2009. As part of this contract a payment
adjustment will be considered every two years with the first consideration taking place in
October 2006.
This budget is very straightforward and there are no surprises or changes. This budget
operates on a "break-even" basis. As in previous years, almost all the revenue comes from
customer charges. In terms of the expenditures, 96% of the expenses go to the haulers and
for disposal fees at the RDF Plant. The city pays the Municipal Utilities for billing services.
Five percent of the building/environmental administrator's time and the environmental
assistant's time are in this budget for the management of the program. The city will continue
to offer its recycling rebate program in 2005. The expenditure amount in the 2005 budget of
$3,800 is for the 2004 program. The rebate offer in 2004 was $15.00 per household and will
be $25.00 per household in 2005. Approximately 250 households took advantage of this
program in 2004.
RECOMMENDATION
It is recommended that the City Council approve the following:
.
Continuation of the recycling rebate program
A SAC increase effective January 1,2005 and January 1,2006
Approve the municipal liquor operation, WWTS, and the garbage/recycling
enterprise fund budgets.
.
.
S:\FINANCE\BUDGE7\2004Budgetf(jf"Parrina\ENIHJNDS.DOC
City of
ElK
River -
13065 Orono Parkway
Elk River, MN 55330
November 8, 2004
File: 808750]-0325
Mr, Pat Klaers
City Administrator
City of Elk River
13065 Orono Parkway
Elk River, MN 55330
RE: SEWER AVAILABILITY CHARGES
Dear Mr. I<laers:
In 2004 the City Council increased the Sewer Availability Charge (SAC) to $2,000 per
residential unit. I am recommending that because of the anticipated expansion of the
Wastewater Treatment Plant (WWTP) sometime in the future to accommodate the
anticipated growth of the City, that the SAC charges be increased in 2005 to at least $2,500
per residential unit and a similar increase in 2006.
As you are aware, the City Council authorized a WWTP Master Plan be prepared in 2004.
With the recently approved update to the Comprehensive Plan providing a framework for
the growth of the City into the future, we are working on completing the Master Plan. The
Master Plan will anticipate expanding the WWTP treatment capacity to approximately 3.5
million gallons per day (MGD) sometime in the future. Enough work has currently been
done on the WWTP Master Plan to know most of the major issues involved in expanding
the WWTP to 3.5 MGD, along with significant capital improvement issues. Some of these
anticipated projects along with ballpark costs and estimated years are listed below:
. Current replacement of digester cover project ($750,000 in 2004)
. Replacement of bar screen and grit removal facilities at the head of the Treatment
Plant - this portion of the WWTP is original construction from 1961 ($1 million in
2005).
. Planning for implementation of a phosphorous removal guideline anticipated from
the MPCA in the near future ($250,000 in 2008).
. Adding equipment to existing structures to increase WWTP treatment capacity from
1.6 million gallons per day (MGD) to 2.1 MGD ($1 million in 2006).
. Land acquisition from Great River Energy to provide additional area for expansion
of the WWTP (unknown dollar amount in 2005 or 2006).
Phone: 763.635.1000
Fax: 763.6351090
www.cLelk-river.mn.us
Sewcr Availability Cbarges
November 8, 2004
Page 2
. Expand capacity at the current site from 2.1 MGD to 3.0 MGD by constructing an
additional series of treatment facilities similar to those existing at the WWTP ($5
million in 2012 - 2015).
. Expand capacity at current WWTP beyond 3.0 MGD to add areas not currendy in
the Urban Service Area ($3-5 million, beyond 2015).
The completion of the WWTP Master Plan in 2005 will lay out a more comprehensive list of
relatively expensive capital and expansion improvements that need to be undertaken over
the next 15 years. One of the key components funding these improvements, especially
WWTP expansion, is SAC charges. It is important that the City increase the SAC charges
now to start to accumulate funds for future improvements, especially with the growth the
City has been experiencing. It should also be noted that current SAC fees are still paying for
the bonds on the last WWTP expansion.
One final piece of information is the following table that lists SAC fees for the surrounding
communities as of November 10, 2004:
- ePt. - ov.
Rogers $3000 $4200
Big Lake $2800 $3600
Monticello $3250 $3515
Otsego $2435 $6200
Zimmerman $3250 $3750
Albertville $4100 $4600
St. Michael $3935 $4187
St. Francis $2800 $3000
AVERAGE $3196.25 $4131.50
Elk River $1500 $2000
SAC S
2002
SAC N 2004
With all this information as background it would be my recommendation that at a minimum
the City increase their SAC charges to $2,500 per residential unit in 2005, and $3,000 per
residential unit in 2006.
If you have any questions regarding this recommendation or would like further information,
please call.
Sincerely,
~fJ1lfau~
Terry J. Maurer, F.E.
City Engineer
S:\pLANNING\Terry Maurer\ 11 0804 SAC chgs.doc
MEMORANDUM
TO: Mayor & City Council
FROM: Rebecca Haug, Environmental Technician
DATE: November 15,2004
SUBJECT: Recycling Rebate Update
The City received 232 valid applications for the $15 Recycling Rebate offer. This is up
from last year's 129 applicants. The total for the rebates will be $3,480. The total for
last year's was $1,935.00. The rebate will be paid out of the landfill abatement fund.
The city will issue checks to be paid out in January 2005.
Staff would like to continue to offer the rebate in 2005. However, staff would like to
increase the amount to $25. The number of residents with 90-gallon containers is rising
and this would hopefully be an incentive to get people to recycle more.
In 2003, applications were available at City Hall, the library and through utility bills. In
2004, applications were available at the same locations as well as having the application
on the City's website for residents to download. The rebate was also advertised in The
Current newsletter. Advertising for the 2005 rebate would be done the same as in 2004.
RECOMMENDATION
Staff recommends the following:
1. Make the recycling rebate application available to all residents in January
2005.
2. Set the rebate amount at $25.00, money to be paid out using landfill
abatement funds
3. Issue checks in January 2006
MUNICIPAL LIQUOR OPERATIONS
Provides for the total operation of the Elk River Municipal Liquor Stores as
authorized by Minnesota State Law and the Elk River City Council.
2005 BUDGET COMPARED WITH 2004 BUDGET
The 2005 municipal liquor operating budget is proposed in the amount of $1,114,100.
This is a $115,900 or 11.6 percent increase over the adopted 2004 budget. The biggest
change in the liquor operation is the planned construction of a second municipal liquor
store. The plan calls for the project to be bid out in February, have construction start in
the spring, and have "Westbound" open for business in late fall of 2005. Westbound is
proposed to be 10,000 sq. ft. and the project has a construction budget of approximately
$1.75 million. Funding for this project will come from a combination of liquor store
reserves and a bond (or a loan from local banks). Northbound, constructed in 1997, is
scheduled to have its debt paid off in 2007.
Overall, sales in 2005 are projected to be flat at Northbound at slightly over $4 million.
Sales for three months at Westbound are projected at $450,000. Based on a 27% gross
profit figure and some miscellaneous revenue, this works out to be $1,241,200 in total
revenues. This is a $53,700 or 4.5 percent increase over the revenues in the adopted
2004 budget.
Regarding expenditures, an increase in personnel services is anticipated with an
additional store needing more manpower. Additionally, personnel services is planned to
increase based on a typical cost of living adjustment and employee wage step increases
as identified in the pay plan. Other expenditure increases to note, all of which are due
mainly to the second store, include an increase in utilities, depreciation, and credit card
fees. Credit card fees are approximately 3% of the operating budget and in general is the
"price of doing business" in today's economy. Approximately 50% of the sales at
Northbound are by credit card. Another expenditure to note is the capital outlay for
$10,000. This is for a new monument sign at Northbound. Also, the transfers in the
amount of $233,300 is at the identical level as what was in the 2004 budget.
With the addition of the second store, another full-time employee is planned to be added
in 2005. The liquor store operation in 2005 will include the liquor store manager plus five
full-time employees and between four and seven part-time employees depending on the
season.
LIQUOR STORE
2002 2003 2004 2005
ACTUAL ACTUAL ADOPTED PROPOSED
SALES 4,072,018 4,152,235 4,150,000 4,600,000
COST OF SALES 2,997,847 3,040,286 2,997,000 3,379,800
GROSS PROFIT 1,074,171 1,111,949 1,153,000 1,220,200
OTHER REVENUE:
INTEREST INCOME 52,294 24,232 30,000 20,000
MISCELLANEOUS 7,706 4,041 4,500 1,000
TOTAL 1,134,171 1,140,222 1,187,500 1,241,200
REVENUE ANALYSIS
Northbound Westbound
Cost of Cost of Gross
Gross Profit Sales Sales Sales Sales Profit
Liquor $ 1,250,000 $ 912,500 $ 135,000 $ 98,550
Beer 2,100,000 1,596,000 225,000 171,000
Wine 600,000 402,000 67,500 45,250
Other Sales 200,000 120,000 22,500 13,500
Frei9ht 19,000 2,000
4,150,000 3,049,500 450,000 330,300
Gross Profit 1,100,500 119,700 $1,220,200
Other Revenue
Interest Income 20,000 20,000
Miscellaneous 500 500 1,000
TOTAL REVENUES $ 1,121,000 $ 120,200 $1,241,200
LIQUOR STORE
2002 2003 2004 2005
ACTUAL ACTUAL ADOPTED PROPOSED
PERSONAL SERVICES $ 332,310 $ 350,101 $ 364,050 $ 413,900
SUPPLIES 28,345 11,019 12,500 18,000
OTHER SERVICES AND CHARGES 185,262 178,591 197,950 248,650
CAPITAL OUTLAY 9,875 10,000
DEBT SERVICE 193,975 186,090 190,400 190,250
TRANSFERS OUT 158,300 183,300 233,300 233,300
TOTAL $ 908,067 $ 909,101 $ 998,200 $ 1,114,100
EXPENDITURE ANALYSIS
PERSONAL SERVICES Northbound Westbound Total
Re9ular Salaries 195,800 57,550 $ 253,350
Overtime Salaries
Part Time Salaries 68,000 15,500 83,500
Employee Pensions 30,950 8,600 39,550
Employee Insurance 26,700 10,800 37,500 $413,900
SUPPLIES
Operating Supplies 14,000 1,500 15,500
Uniforms 1,500 1,000 2,500 18,000
OTHER SERVICES & CHARGES
Audit 5,000 1,000 6,000
Other Professional Services 500 500 1,000
Telephone 3,500 900 4,400
Postage 50 50 100
Advertising 21,200 3,050 24,250
Repair & Maintenance 4,500 500 5,000
Rug & Laundry Services 3,250 250 3,500
Utilities 28,000 6,500 34,500
Insurance 13,800 3,450 17,250
Conferences & Schools 1,500 500 2,000
Dues & Subscriptions 2,400 350 2,750
Depreciation 70,000 30,000 100,000
Licenses & Taxes 450 450 900
Credit Card Fees & Uncollectible Debt 41,000 6,000 47,000 248,650
CAPITAL OUTLAY
Furniture & Equipment 10,000 10,000 10,000
DEBT SERVICE
Principal 165,000 165,000
Interest 25,250 25,250 190,250
TRANSFERS OUT
General Fund 195,000 195,000
City Hall Debt Service 38,300 38,300 233.300
$ 965.650 $ 148,450 $ 1,114,100 $ 1.114.100
WASTE WATER TREATMENT SYSTEM
Provides for the administration, operation, and maintenance of the sanitary sewer
system, laboratory, and lift stations for the sanitary treatment of household,
commercial, and industrial waste deposited into the sanitary sewer system.
2005 BUDGET COMPARED WITH 2004 BUDGET
The 2005 Wastewater Treatment System (WWTS) budget calls for expenditures in the
amount of $1,665,350. This represents a $337,200 or 25.4% increase from the 2004
budget. The WWTS department includes four full-time employees plus one summer
seasonal employee.
Depreciation is the main reason for the budget increase. The new GASB 34 accounting
rules require depreciation not only on the plant and lift stations but also on all of the
sewer pipes under the streets. Accordingly, depreciation went from $300,000 in the 2004
budget to $686,000 in the 2005 budget. This is a $386,000 increase.
Another change to note in the 2005 budget as compared to 2004 is that the debt
payment on the 1994 improvement project has been paid off. The city now is only
making debt payments on the 1996 improvement project. Accordingly, the debt
expenditure decreased $130,700 in the 2005 budget and is shown as a total in 2005 at
$216,500. This is good news as additional debt in the near future is anticipated for plant
expansion improvements.
The capital outlay expenditures identified in the 2005 budget include: a new truck for
$25,000; a new hoist for working in and around the lift stations for $18,000; and
improvements to the Upland/Main Street lift station in the amount of $6,500. Other
expenditure increases are in the personnel services category for typical employee wage
and step increases. The engineering line item includes work on the facilities master plan
and work on the trunk sewer analysis for the Highway 169/County Road 33 area.
Regarding revenues there is a slight increase in the revenues for customer charges
based on more customers and a 3% rate increase. The most significant increase in the
revenues category is in the sewer availability charge. The projection in 2005 is $750,000
and this is nearly identical to the actual amount received in 2003. These funds are
intended for debt payment, plant replacement expenditures, and for plant expansion
improvements. The SAC fee is being projected for 2005 at $2,500 per unit. The SAC
revenues are based on 300 new homes being started in 2005.
It should be noted that one major capital improvement is planned for the plant in 2005.
This is the headworks project and this expenditure is identified in the capital
improvement program. The headworks is where major pipes from the city lift stations
enter the sewer plant. This project is estimated at a cost between $1-1.5 million. Funding
for this project will come from the WWTS reserves.
WASTE WA TER TREA TMENT SYSTEM
CHARGES FOR SERVICES
OTHER REVENUE
TOTAL REVENUES
USE OF RESERVES
TOTAL SOURCE OF FUNDS
2002
ACTUAL
$1,026,879
409,272
$1,436,151
o
$1,436,151
2003
. ACTUAL
$1,054,110
818,166
$1,872,276
o
$1,872,276
2004
ADOPTED
$1,075,000
365,000
$1,440,000
o
$1,440,000
2005
PROPOSED
$1,152,000
800,000
$1,952,000
o
$1,952,000
REVENUE ANALYSIS
CHARGES FOR SERVICES
Customer Charges
..................................
HHHH $1,152,000
OTHER REVENUE
Sewer Connection Charges
Interest Income
................ ......................
....................
$1,952,000
TOTAL REVENUES
Use of Reserves
TOTAL SOURCE OF FUNDS
750,000
50,000
$1,152,000
800,000
$1,952,000
WASTE WA TER TREA TMENT SYSTEM
PERSONAL SERVICES
SUPPLIES
OTHER SERVICES AND CHARGES
CAPITAL OUTLAY
DEBT SERVICE
TRANSFERS OUT
TOTAL
PERSONAL SERVICES
Regular Salaries
Overtime Salaries
Employee Pensions
Employee Insurance
SUPPLIES
Office Supplies
Operating Supplies
Motor Fuels & Lubricants
Equipment Parts
OTHER SERVICES & CHARGES
Engineering Services
Audit
Other Professional Services
Telephone
Postage
Printing & Publishing
Repair & Maintenance
Insurance
Solid Waste
Utilities
Cleaning Services
Contractual Services
Uniform Rental
Depreciation
Conferences & Schools
Dues & Subscriptions
Licenses & Taxes
CAPITAL OUTLAY
Buildings
Improvement Project
Equipment
DEBT SERVICE
Principal
Interest
TRANSFERS OUT
General Fund
debt Service
2002
ACTUAL
$238,906
57,214
634,631
11,102
341,977
24,230
$1,308,060
2003
ACTUAL
$253,884
58,755
942,795
243,049
338,264
33,910
$1,870,657
EXPENDITURE ANALYSIS
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2004
ADOPTED
$302,900
59,500
524,050
61,000
347,200
33,500
$1,328,150
$250,350
17,500
31,400
40,950
900
29,500
4,000
22,300
50,000
3,500
10,950
2,250
250
450
46,500
10,000
3,000
119,000
500
20,000
4,000
686,000
3,950
100
8,950
49,500
115,000
101,500
15,000
18,050
2005
PROPOSED
$340,200
56,700
969,400
49,500
216,500
33,050
$1,665,350
$340,200
56,700
969,400
..
49,500
216,500
33,050
$1,665,350
GARBAGE COLLECTION PROGRAM
This budget includes expenditures for service contracts with haulers for the
collection of the city's garbage and recycling material, payment for disposal of
waste at the Refuse Derived Fuel (RDF) plant, and for the overall administration
of the program, including coordination with the Elk River Municipal Utilities for
customer billing.
2005 BUDGET COMPARED WITH 2004 BUDGET
The city began the organized residential garbage collection and recycling program in
November 1990. The garbage collection and recycling program deals only w~h
residential properties of four units or less. The Elk River Municipal Utilities collects the
garbage customer fees for the city. The city makes payments to the garbage collection
firms for services and to the RDF Plant for disposal. The city is beginning a new five year
contract with Randy's Sanitation and BFI for garbage collection and recycling services.
This contract expires in October 2009. Additionally, the city has entered into a long term
contract with the county for the disposal of garbage at the RDF plant. This contract
established disposal fees at $45.00 per ton and runs through April 2008.
Currently, the city has approximately 5,736 customers. The customer breakdown of the
program by type of container shows: 3,537 ninety-gallon containers, 1,328 sixty-gallon
containers, 502 thirty-two gallon containers, and 198 thirty-two gallon (picked up bi-
weekly) containers. Additionally, 171 customers have two or more 90-gallon containers
that are picked up weekiy. Recycling material is picked up weekly except for the
households that have bi-weekly garbage service. In 2004 the majority of the new
households selected the 60 gallon container option.
The 2005 garbage collection and recycling program budget is proposed in the amount of
$1,019,800. This is a $66,850 or 7 percent increase over the adopted 2004 budget. The
increase in this budget is due to the moderate rate of residential growth which the city is
experiencing. There are no rate changes to the customers being planned for 2005.
Regarding expenditures, the garbage hauler payment and the waste disposal fees
amount to 96 % of the total budget. This percentage is consistent with previous years.
The garbage hauler payment is based on actual customer counts and the waste disposal
fee is based on RDF plant tonnage figures. Other expenditures to note include the
$26,500 payment to the Elk River Municipal Utilities for biling and collection services, the
$7,900 for city staff time that is necessary to manage this program, and $3,800 for the
recycling rebate program.
GARBAGE COLLECTION
REVENUE ANALYSIS
2002 2003 2004 2005
ACTUAL ACTUAL ADOPTED PROPOSED
INTERGOVERNMENTAL $ 5,393 $ 16,562 $ 5,700 $ 5,000
CHARGES FOR SERVICES 752,104 806,102 940,000 1,020,000
OTHER REVENUE 3,667 8,612 13,000 11,500
TOTAL REVENUES $ 761,164 $ 831,276 $ 958,700 $ 1,036,500
TRANSFER IN 0 0 0 3,800
TOTAL SOURCES OF FUNDS $ 761,164 $ 831,276 $ 958,700 $ 1,040,300
INTERGOVERNMENTAL
Special Assessments
5,000 $
5,000
CHARGES FOR SERVICES
Garbage Customer Charges
1,020,000
1,020,000
OTHER REVENUE
Interest Income
Customer Penalties
500
11,000
11,500
1,036,500
TOTAL REVENUES
TRANSFER IN FROM LANDFILL
3,800
TOTAL SOURCES OF FUNDS
$ 1,040,300
EXPENDITURE ANALYSIS
PERSONAL SERVICES
OTHER SERVICES AND CHARGES
TOTAL
2002 2003 2004 2005
ACTUAL ACTUAL ADOPTED PROPOSED
$ $ 3,833 $ 6,850 $ 7,900
837,373 880,699 946,100 1,011,900
$ 837,373 $ 884,532 $ 952,950 $ 1,019,800
PERSONAL SERVICES
$
6,350
750
800 $
7,900
Regular Salaries
Employee Pensions
Employee Insurance
OTHER SERVICES & CHARGES
Billing Services
Other Professional Services
Postage
Hauler Contracts
Solid Waste
Recycling Rebates
..............
26,500
1,500
100
680,000
300,000
3,800
1,011,900
.....................
$ 1,019,800
Item 6.7b.
MEMORANDUM
TO: Mayor and City Council
FROM: Pat Klaers, City Administrator
DATE: November IS, 2004
SUBJECT: 2005 General Fund Budget
In the August and September budget meetings, discussion centered on requested city staff
additions and the anticipated increase in the city Net Tax Capacity (NTC). It became clear as
the discussions progressed that the City Council desired no change in the city tax rate in
2005 as compared to 2004.
The last estimate from the county indicated that the city NTC will increase 16.1 % and this
will generate a significant amount of additional tax revenues without a tax rate change. This
additional tax revenue combined with an increase in the growth related revenues (based on
the volume of building permits, plan check fees, etc.) and additional Local Government Aid
(LGA) resulted in a draft budget that the City Council accepted in the amount of $9,281,900.
This is a $1,406,550 or 17.86% increase from the adopted 2004 general fund budget.
The additional revenues in 2005 allows the City Council to add a number of staff positions
that had been cut or delayed because of the 2003 LGA cuts and also allows the Council to
add some staff to various departments in order to keep pace with growth and development
issues and citizen demands for additional services. Overall the plan in 2005 is to fill seven
full time and two part time positions. All but one of these positions are in the budget for 12
months; the exception being the community development director, which is scheduled to
start in July.
Since the September 7, 2004 budget worksession there have been a number of staff
discussions regarding some changes in the 2005 draft budget. There is only one minor non-
tax change to the budget revenues; but some adjustments within expenditure categories are
being evaluated. On the expenditure side of the issue is the fact the police union settled for
more than the 3% that was within the draft budget. The extra 2% for the police union
amounts to approximately $27,000. Another expenditure issue is the conference/schools line
item in the Planning Department as the director of planning has started work towards her
master's degree. City policy calls for a maximum of $3,OOO/year to be provided for tuition
s: \ Council\Pat\Budget\2005\ GeneralFundl11S.doc
reimbursement. Another expenditure change that is now being requested is in the
building/ grounds maintenance program. The six part time employees in this program are
being requested to be changed to two part time and two full time positions. This change will
impact the benefits that the city pays. Additionally, some added hours are being requested
for the part time employee that is dedicated to the building grounds and to provide extra
attention in the winter to Lions Park Center. (please see the attached memo from Phil Hals
regarding building cleaners.) Finally, still on the expenditure side of the equation, the
sergeants are currently negotiating a new contract and this may have an impact on the 2005
budget if the total package exceeds what is included within the draft budget.
Offsetting some of these expenditure changes is the fact that there was a slight excess of
revenues over expenditures when we adjourned the last budget meeting and the vehicle for
the fire prevention specialist is being purchased in 2004. This vehicle savings of $30,000 in
the 2005 budget goes a long ways towards offsetting the expenditure adjustments noted
above. However, in order to balance the budget we need to reduce some expenditures in the
personnel area by starting some employees after January 1, 2005. This will not be a problem
from a staffing point of view but will impact the 2006 budget. Having nine months of wages
and benefits in the 2005 budget versus twelve months of wages and benefits in the 2006
budget obviously provides less flexibility when looking at proposals for 2006. This is not a
huge impact but one that needs to be mentioned.
Overall, I simply wanted to provide the Council with an update as to where we are standing
with the 2005 budget prior to the Truth in Taxation public hearing on December 6, 2004.
The request with this memo is to change the building cleaner's program from six part time
positions to two part time and two full time positions and to add 540 hours to the budget
for building cleaning/maintenance. These additional expenditures will be offset by planning
to start some employees a few months after January 1, 2005
Recommendation
It is recommended that the City Council approve adding 540 hours to the building grounds/maintenance program and the changing of the cleaning staff from six part time to
two part time and two full time employees.
$: \Council\Pat\Budgct\200S \ GenernlFund1115.doc
MEMORANDUM
TO:
Pat Klaers
FROM:
Phil Hals
DATE:
September 20, 2004
SUBJECT:
Building Cleaners
After reviewing a letter of resignation from lead cleaner, Uoyd VanVleet this week, Lori
Johnson, Gary Lore and I met to discuss cleaner needs as well as to how to fill this position.
After a lengthy discussion, we would like you to consider the following adjustments:
o Move 2 of the present cleaning staff from part time to full time.
Cost Benefit package total from $8,400 to $15,400 depending on which insurance
package they each selected. This would add 12 and 15 hours per week for additional
cleaning for City Hall, the Public Safety Building and the remote city buildings.
o Add a 4-hour per day Park employee that would be supervised by Gary Lore.
Cost: Additional 540 hours per year for a total of$7,500. This person would clean
Lions Park Center, Trott Brook barn and the Emporium. Other duties would include
summer grounds maintenance and winter snow shoveling.
The major points that we considered were:
,/ Present cleaning schedules have 8 hours per day for City Hall, 8 hours for Public
Safety and 4 to 5 hours for Lions Park Center and the other remote city buildings.
This staffing is so tight that to do "extras" in any buildings, the cleaners have to
reduce services somewhere else, or if a cleaner is sick or on vacation Butch has to fill
in and is not available for building maintenance.
,/ Lions Park Center must be cleaned in the early morning hours and there are so many
activities scheduled there that it is very difficult to schedule a floor cleaning.
,/ Trott Brook barn has not been on anyone's schedule for cleaning.
,/ The cleaners are spending a lot of time picking up trash around Lions Park Center.
,/ 3 of the 4 cleaners have other jobs so adding a few hours per day is not an option.
Memorandum
September 20, 2004
Page 2
The 2005 budget now has 500 hours for this type of work. We discussed this scenario with
Park and Recreation Director, Bill Maertz and he agrees that it would be easier to coordinate
the Lions Park Center schedule by having a dedicated cleaner who could also clean the Trott
Brook bam and possibly serve as a building supervisor there as well.
We realize that the timing with regards to the budget is poor, but the resignation of Uoyd
has forced this issue. Please advise on how to proceed. Lori, Gary and I will be happy to
meet with you to discuss these and other options.
Item 6.7.c.
MEMORANDUM
TO:
Mayor and City Council
FROM:
Pat Klaers, City Admini~
{f(I/
November IS, 2004
DATE:
SUBJECT:
Supplemental Budgets
The city has eight programs or budgets that it identifies as "supplemental" budgets. These
supplemental budgets are: library, surface water management, city special assessments, ice
arena, equipment certificates, equipment reserves, sanitary landfill, and safety.
The supplemental budgets that have received the most City Council discussion are the
equipment reserves and equipment certificates. Most of the other supplemental budgets have
been briefly discussed by the City Council as some of them are funded (or partly funded)
with tax revenues. Also, it should be noted that typically there is not a big change from year
to year in most of these budgets.
At this time, unless I have information to hand out at the meeting, I would like to delay the
review of the supplemental budgets until the special City Council worksession on November
22, 2005.
s: \ Council\Pat\Budger\200S \Supplementl11S04.doc