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HomeMy WebLinkAbout2011 04-11 City Concil/Manager Workshop Packet AGENDA MAPLEWOOD CITY COUNCIL MANAGER WORKSHOP 5:15P.M. Monday,April 11, 2011 Council Chambers, City Hall A.CALL TO ORDER B.ROLL CALL C.APPROVAL OF AGENDA D.UNFINISHED BUSINESS 1.2010 Financial Summary 2.MCC Fund Discussion 3.Discussion on Referendum Timingand Topics E.NEW BUSINESS F.ADJOURNMENT THIS PAGE IS INTENTIONALLY LEFT BLANK AGENDA NO.D-1 AGENDA REPORT TO: City Manager FROM: Finance Manager Assistant City Manager 2010 Summary from the Finance Department RE: DATE: March 31,2011 INTRODUCTION Many changes were made in the Finance Department during 2010 including the hiring of a new Finance Manager and Assistant Finance Manager. This report is intended to give the Council an idea of the challenges that we faced and where we sit at the end of 2010. DISCUSSION The new Finance Manager began employment on 05-10-10 and at that point the audit for 2009 was not yet complete and there was much work left to dobefore it could be completed. Approximately 1,000 lines of journal entries were entered during the next 2 months to get the 2009 books to a point where both the auditors and the Finance Manager were satisfied. Some of the major tasks that needed to be donewere: reconciliation of the bank accounts from Feb 2009 topresent; review of revenue accounts for miscodings; fixed asset/infrastructure entries; interest allocations; and reconciliation ofthe Developer funds. Since closing the books on 2009, staff has had more time to analyze all funds and review activity from 2007 to present. Here is a list of some of the hurdles we encountered: Many accounts were added during 2007-2009because of new funds or programs. The majority of these accounts required some type of adjustment or needed to be deleted. Utility revenues were scheduled outfrom 2007 - 2009and it was noted that revenues were being deposited into incorrect funds.The North St. Paul Water Surcharge was first effective in January 2007. All of these revenues had been coded to the St. Paul WAC fund and needed to be recoded to the North St. Paul WAC fund. This makes things very difficult when staff is putting together infrastructure financing schedules and fund balances are not reflecting actual activity. Project Accounting set up had to be reviewed and amendedto help with the audit process. There were many balance sheet accounts that had not been reconciled since 2006. All of the activity from 2007 - 2010was reviewed and immaterial adjustments were made to bring the accounts tothecorrect balances. 100 funds were closed during 2010 including: 55 Public Improvement funds – this involved scheduling out all of the revenue and expenditures for each project and reviewing bond issues to determine if all transfers were made correctly. Some transfers needed to be reversed because the funds were bonded for and the transfer was a double dip. Also, State Aid payments had to be reviewed because some were bonded for and needed to be transferred to the Debt Service fund instead of being counted as revenue in the PIP fund. 8 Debt Service funds – this involved scheduling out all of the revenues and expenditures for each bond issue and the transfers made 34 Developer funds – all of the activity since 2006 needed to be analyzed. There were corrections needed and small balances were eliminated. Major projects yet to be done include: Prepare cash forecasting model Work withbrokers on investment portfolio Resume billings to developers Debt service analysis Ambulance Service fund analysis MCC forecasting General Fund In our 2011 budget document, the 12/31/10 fund balance was estimated to be $6,501,087. As we work our way through the audit process, the ending unreserved fund balance currently sits at $7,317,855, or $816,768higher than anticipated. Of this amount, $84,756 needs to be applied to encumbered items at 12/31/10 and $115,740 needs to be applied to the carryovers authorized at the 02/28/11 council meeting.These items are over and above what was anticipated in the 2011 budget.This leaves $616,272 of unreserved/unbudgeted one time money. The following shows where the differences were in 2010: th At the March 14council meeting, we discussed 2011 capital expenditures, the 2012-2016 Capital Improvement Plan, and recommendations for the possible use of the additional fund balance. Because the figure available dropped to $616,000, staff is recommending the following: Our first priority is still to increase our reserves in the General Fund.To increase the fund balance as a percentage of revenues from 36.1% to 38.5%: $356,000 Apply to 2011 capital projects as follows: New phone system $ 90,000 MCC pool upgrades $150,000 City Hall/Police space needs study $ 20,000 th This differs from the recommendation made on March 14as follows: General Fund reserves (39.0% to 38.5%) ($ 64,000) Employee Benefit Fund ($100,000) MCC Light Fixture Grant match ($ 20,000) Staff will bring forward the appropriate requests for funds at future council meetings as the capital projects develop. Council will either authorize or deny the projects at that time. CONCLUSION Staff will continue to monitor activity and plans on getting back on the cycle of distributing monthly financial reports to the council by the end of April. Thank you for your continued support of achieving a financially sustainable Maplewood. WorkshopAgendaItemD2 AGENDA REPORT TO: James Antonen, City Manager FROM: DuWayne Konewko, Parks and Recreation Director SUBJECT: MCC Fund Discussion DATE: April 4, 2011 INTRODUCTION As per the City Council’s request following the Staff Retreat held this past February, staff is submitting a sustainable five-year MCC budget proposal for council’s review and comment. The following MCC budget proposal puts in place target goals for each respective year going out through 2016 for expenditures and revenue – refer to figures 1 and 2 respectively. The budget proposal speaks directly to reducing the difference, or bridging the gap, between expenditures and revenue. This difference, which we’re calling the “swing factor,” is tied directly to the property tax levy contribution for the MCC. The swing factor represents the difference between the expenditures (see figure 1 for expenditure breakdown) and revenue (see figure 2 for revenue breakdown) for a given year. As an example, the swing factor for 2010 was $414,000, which is the difference between the expenditures ($2,344,000) and the revenue ($1,930,000) for the MCC. Staff believes that a sustainable budget, by the conclusion of this five-year period, results in a property tax levy contribution of approximately $150,000. This figure does not include any monies for Capital Improvement Projects. The table below illustrates the proposed swing factor trend and the corresponding percent change/year over year for the period starting in 2011 and running through 2016. Another element of the MCC budget in addition to the $150,000.00 proposed property tax levy will be capital improvement funds. As Council is aware, CIP funds have been cut from the Community Center for the past five years including 2012 and 2013. As a result of these cuts the Community Center has fallen into a state of disrepair. The proposed budget is designed to begin making improvements to the MCC which will ultimately result in increased revenue, allowing the MCC to fulfill its financial obligations to the City as well. To that end, staff is proposing that council set aside $200,000.00 - $225,000.00 annually for capital improvement projects at the MCC. The goal by 2016 will be to reach a $400,000.00 annual subsidy amount. This figure will include both the $150,000.00 tax property levy as well as the CIP funds noted above (see figure 3 for breakdown of proposed CIP, Tax Property Levy, and overall MCC subsidy amounts). PROPOSED SWING FACTOR TREND – 2011 thru 2016 YEARSWING FACTOR PERCENT OF CHANGE/ YEAR OVER YEAR 2010 $414,000.00 2011 $325,000.00 22% 2012 $285,000.00 13% 2013 $235,000.00 17% 2014 $190,000.00 20% 2015 $165,000.00 13% 2016 $150,000.00 9% WorkshopAgendaItemD2 ACTION PLAN Staff proposes the following action items to achieve the aforementioned goals: 1) Increase In Membership Levels Increased Family Focus: The Maplewood Community Center will focus on creating a welcoming environment for families and work to grow this important membership demographic. To accomplish this, the Maplewood Community Center will begin by remodeling the building’s flagship amenity - the aquatics center. Staff, with the aid of local contractors, has developed an innovative renovation strategy to make the aquatic center more appealing for families with children of all ages. Improvements, scheduled to be phased in over the next five years, will include increased interactive play structures for older children, smaller slides and water features for younger children, and bright murals designed to create a bright welcoming environment for guests of all ages. Following the lead of many of our area competitors, staff is also reviewing the feasibility of installing an indoor playground again designed to target young families. This project would be undertaken in 2012 – 2013. Continued Senior Programming Offerings: The MCC has experienced great success with our senior demographic. To continue to support these memberships, staff will continue to offer a variety of senior programming options including senior fitness, senior seminars, card clubs, and day trips. To welcome additional seniors to our facility, MCC will be introducing the Healthways SilverSneakers Fitness Program in May 2011. The SilverSneakers Fitness Program is an innovative health, exercise and wellness program helping older adults live healthy, active lifestyles. 2) Increase In Banquet Activities Special Events: MCC will continue to offer special events for audiences of all ages. These special events have proven to be a great source of revenue and as such will continue to be a pivotal growth point for the Community Center. In addition, these special events WorkshopAgendaItemD2 serve to increase the sense of community in the City of Maplewood while also helping to improve Maplewood’s overall image. Weddings/Banquet Use: The Community Center will continue to increase awareness of our meeting and special event space by participating in a variety of community wedding fairs and expos. 3) Increase In Theater Activities Five Year Rental Contract with Ashland Productions: In 2011 the MCC entered into a five-year contract with Ashland Productions. This contract will ensure a consistent tenant in the theater and a guaranteed annual base revenue of $32,500. Expanded Entertainment Series: On top of shows presented by Ashland Productions, the MCC will also host an expanded entertainment series offering 10 – 20 performances a year from a variety of musical genres. In addition, MCC is currently pursuing grants and other outside funding which would allow them to produce a cultural entertainment series in 2012. 4) Joint Powers Agreement With North St. Paul Increased Recreation Programming For Both Maplewood & North St. Paul Increased Arts Programming For Both Maplewood & North St. Paul 5) Increase In Fitness Activities Streamline Program Offerings Offer Fitness Programs At North St. Paul Community Center 6) Operational Improvements Decrease In Staffing Levels Decrease In Operating Expenditures Secure Additional Partnerships & Grants WorkshopAgendaItemD2 Eliminate Marginal Programs DISCUSSION Staff is seeking direction from the City Council regarding what the property tax levy for the MCC should be moving forward. Staff recommends that this number should be approximately $150,000.00 to offset operating expenses. This amount should be supplemented annually with $200,000.00 - $225,000.00 in capital improvement funds to maintain the integrity of the building. RECOMMENDATION Provide staff feedback regarding the feasibility of the proposed budget and action plan. WorkshopAgendaItemD2 Figure1:ProjectedMCCExpenditures 2,450 2,400 2,350 2,300 2,250 2,200 2,150 201220142016 FISCALYEAR Figure2:ProjectedMCCRevenue 2,120 2,100 2,080 2,060 2,040 2,020 2,000 1,980 1,960 1,940 201220142016 FISCALYEAR WorkshopAgendaItemD2 Figure3:ProposedCIP,TaxPropertyLevy,AndOverallMCCSubsidyAmounts 600 500 PropertyTaxLevy 400 300 CIP 200 Total=Property taxlevy+CIP 100 0 201220142016 FISCALYEAR Work Session Agenda Item D3 AGENDA REPORT TO : City Council FROM: Charles Ahl, Assistant City Manager SUBJECT:Discussion of Referendum Timing and Topics DATE:April 6, 2011 INTRODUCTION This item is being brought forward on the Work Session agendato begin a discussion with the Council on the possibility of conducting a referendum on providing for some various facilities within the City. This item was discussed in a very preliminary nature at the February 2011 Council – Staff Retreat. No action is proposed on this item at this time. Background Information The topic of a referendum for various facilities hasbeen reviewed over the past two years. The scope of what issues would be asked and what the amount of funding to be considered isunknown. The Open Space Referendum from the 1990’s will make final payment on those bonds in 2014. One consideration is to have a referendum in 2012 or 2013, with the first payments on the bonds structure to continue the impact on the taxpayer similar to that referendum question. The amount of time necessary to properly prepare for a referendum question is typically 9-12 months in advance, although legal requirements for notice are much less. It is staff’s recommendation that a 2011 ballot question will not allow for the proper timing to prepare for the consideration of placing this on the ballot. The Council should discuss the timing of their desires to pursue a referendum question in 2012 or 2013. The staff will present information on legal requirements for a referendum at the Work Session. A second area of discussion for the Council is to decide areas of consideration or emphasis. The following areas have been raised as potential questions in the past 2 -3 years: 1.New Police Department Facility – this will be the topic of the space needs study later in the regular agenda. Either expansion of the Police Department facility or an entirely new Police facility could be a question. 2.New Fire Department Facilities – Chief Lukin has proposed a plan to reduce the number of Fire Stations, but also there is a need to construct a new facility within the southern leg of the Community, possibly near 3M, as well as retrofit Fire Station #7 and #2. 3.Fish Creek – this has been proposed to purchase this open space parcel. 4.Parks – our Parks facilities could use a significant infusion of cash to improve the overall facilities being provided within the community. The scope of the work to be done has not been studied in detail. 5.Maplewood Community Center – the MCC was constructed in 1994. Many of the facility needs are going to be coming due for replacement. Funds have not been identified for this purpose. 6.Trails – the Comprehensive Plan proposes a network of trails to provide alternative facilities to the automobile along with recreational amenities within our community. No direct funding has been identified. The Council should discuss which, if any of these areas, should be developed further for a possible referendum question. If an area is identified, additional scoping work will be consideredto determine level of funding and improvements. This is not the final decision but is intended to provide the Council an opportunity to begin the discussion of the referendum question. REFERENDUM DISCUSSION PAGE TWO OtherConsideration Followingis an update from LMC on some current legislation that is being considered by the state legislature as an alternative to a taxpayer referendum and using a local sales tax. No determination on this can be made, as numerous steps are necessary and this option does not currently exist for Cities and it is unknown if it will remain in the tax bill: The Senate bill also generally authorizes cities or groups of cities to impose a local sales tax of one-half percent, with voter approval, that could be used to fund civic and convention centers; public libraries; parks, trails, and recreation centers; overpasses, arterial, and collector roads; bridges, railroad overpasses, and railroad protection measures; water quality for groundwater and drinking water pollution problems; fire and law enforcement facilities; and municipal buildings. Recommended Action No action is recommended on this item. This is a discussion issue.