City Council Minutes 06-23-2014 SpecialMINUTES
SPECIAL WORKSHOP MEETING — MONTICELLO CITE' COUNCIL
Monday, June 23, 2014 — 6:15 p.m.
Mississippi Room, Monticello Community Center
Present: Clint Herbst, Lloyd Hilgart, Tom Perrault, Glen Posusta, Brian Stumpf
Absent: None
Others: Wayne Oberg, Jeff O'Neill
1. Call to Order
Mayor Herbst called the special meeting to order at 6:15 p.m.
2. Purpose of Workshop: Review of proposed 2015 Tax Lew and Budget
Jeff O'Neill introduced the budget workshop and turned it over to Wayne Oberg who
prepared a presentation showing financial and budget information. Wayne Oberg
explained the purposes of a budget. He provided a list of important dates and a schedule
associated with the 2015 budget process. "What's New" included no levy limits and a
minimum wage increase to be incorporated into the 2015 budget. Glen Posusta asked
how many employees that would effect. Kitty Baltos explained that the minimum wage
increase will affect a portion of their adult workers this coming year and eventually could
affect student workers. Glen Posusta asked if there was a plan for accommodating that.
Kitty Baltos stated that they have discussed some ideas but have not made any decisions
yet.
Wayne Oberg reviewed the tax levy summary from 1999 through 2014, which was set at
$8.15 million. The levy has been relatively constant since 2009. Next, Wayne Oberg
showed the comparison between tax capacity values and rates for the City. He also
compared tax rates among Wright County cities. The tax levy spread is about 37%
county, 24% school and 38% city. In 2014, the tax levy incorporated debt service,
general fund, and MCC operations. Most of the increase in the tax levy went to debt
service to accommodate additional debt service expenditures in 2014.
Wayne Oberg reviewed three rules for budgeting: spend your most restrictive money
first, offset recurring expenditures with recurring revenues, and estimate revenue
conservatively while estimating expenditures liberally. Wayne Oberg pointed out some
key issues the city faces: dependency on property taxes (81% of general fund revenues),
tax base changes (nuclear plant value is higher), personnel services (40% of the budget),
low impact fees, and some large delinquent assessments. Wayne Oberg reviewed some
of the personnel services trends with actual costs decreasing in 2013. In regard to the
debt service levy, Wayne would recommend using the tax levy to manage the payments
for the years when the payments are higher.
Wayne Oberg talked about the model for budget preparation with department heads
preparing their requests, which are then recommended and discussed prior to adoption by
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Council. Wayne Oberg presented a recommendation of a 2.1 % levy increase which is
equal to the cost of living increase. Wayne Oberg discussed the potential large increase
in value on the nuclear plant which would help absorb a tax levy increase. Wayne Oberg
noted that the 2014 budget included 1 % wage increase and 5% benefit increase. Council
will be asked for input on 2015 wage and benefit amounts, and once those are determined
the remainder of the budget falls into place.
Glen Posusta asked why the MCC operations shows an increase in expenditures. Wayne
Oberg explained that he is now accounting for IT /copier /printer services and several other
expenditures in the MCC fund instead of in the general fund. Glen Posusta asked if any
of the MCC improvements have resulted in cost savings, and Kitty Baltos noted that the
electrical bills have leveled off.
Jeff O'Neill talked about the potential for doing some capital improvement planning for
future years when the debt service levels decrease after 2016. Glen Posusta suggested
that the street reconstruction project should be looked at again, especially for the areas
that have been delayed.
Wayne Oberg noted that his recommendation of 2.1 % tax levy would be adequate if the
police service hours stay at their current level. He suggested an increase to 3% if the city
reinstates the police contract hours back to 2013 levels.
3. Adiournment
TOM PERRAULT MOVED TO ADJOURN THE SPECIAL MEETING AT 6:56 P.M.
GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED 5 -0.
Recorder: Catherine M. Shuman
Approved: July 14, 2014
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