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10-28-03 WSOctober 28, 2003 Page 1 MINUTES CITY COUNCIL WORK SESSION -October 28, 2003 A work session of the Hopkins City Council was called to order by Mayor Gene Maxwell at 6:30 p.m. on October 28, 2003, at the City Hall. Council members Brausen, Jensen, Johnson and Rowan were present. City personnel present were: City Manager Steve Mielke; Facilities Manager Jay Strachota; Depot Manager Kathleen Tabor; Pavilion Manager Don Olson; and Finance Duector Lori Yager. 2004 Budget Review Depot Mr. Strachota felt progress had been made this yeaz financially largely due to the Juvenile Justice grant, the School District lease and the cover chazge for events. Ms. Taber has done much counter work herself to save costs. The new team coordinator is doing a good job with the board. Next yeaz's goals include increasing concession revenue, continuing the school business program, developing the board, and getting grants. Ms. Taber thinks Excelsior Blvd. construction hurt revenues. Starting next month hours will be shortened. She feels the government grant will be renewed; she should heaz November 7. It was a showpiece site for federal government inspection this yeaz, and McKnight is having the Depot Board come talk to them this yeaz. They are working to cover the cost of the police presence on Friday nights. She feels they won't use as much levy for lease from the school this year so more money will be available next year. The grant writer works on commission, which is very unusual and helps expenses. Ms. Yager said the Depot is doing much better than was thought in 2002. Ms. Jensen said the dollar figures don't show how much the programs are accomplishing. Answering questions, Ms. Taber said she would be meeting with Three Rivers on funding soon. Holiday hours did not work 2 yeazs ago; this year she tried short hours a couple of holidays and will try again the coming year. Skate Park Mr. Mielke said the skate park made money only the first yeaz. It no longer makes sense to have it as an enterprise fund and should go into the general fund or a special fund if Council wants to keep it open. Ms. Taber said the volunteer program to save costs cut labor 40% and the grant writer is willing to try for grants. She is working with Kathy Magdal to see if it helps cut street accidents, etc. If made into a Tier 1 park, it could be free but supervision would still be needed. Mr. Strachota said it is an outstanding park. He tried to contact True Ride and feels they would say not to cut it back. The Minnesota League puts an extra insurance charge on for Tier 2; he will see if other cities can band together to get that removed as injuries have not materialized. He plans to talk to the Jaycees about support. Answering Council questions, Ms. Taber said they tried partnering with CalSurf, and not enough signed up to put on a class. Ms. Yager said the annual subsidy is $17-20,000. It could be put in the general fund with park and recreation, then if grants don't materialize to cover costs could choose to not open it. Mr. Strachota said Burnsville is going to an unattended Tier 1 to keep theirs open but the location here would make no supervision a poor choice. Sponsors are difficult to get due to low attendance; perhaps next yeaz it could be free to see if attendance picks up to make that possible. Mr. Mielke said park dedication funds aze not a source as they can be used only for capital uses, not operations. October 28, 2003 Page 2 Ms. Jensen wondered if Community Ed. might help as it would get skaters off school property. General Consensus was to put it in the general fund for the present with the idea that if grants do not materialize to cover the costs the Council can then decide if it should open. Mayor Maxwell asked Council get a list of possible grants/donations to go with the budget. Hopkins Center for the Arts Mr. Strachota said 2003 has seen steady progress. Rentals were up 23%. The rental coordinator volunteered to cut back to 4 days. HCA, Inc. has partnered with Xcel and Cornerstone. The city web site is a good showcase for it now. There is a possibility of a Stages/school district partnership, using HCA as performance space, not to house the program itself. He quoted regular rates to them. Regular staff has adapted their hours to cut part-time staff costs. Mr. Rowan asked about salazies going up when one person was cut back; Ms. Yager checked and found that the numbers reflected the 2003 budget adjustments.. Ms. Johnson asked about an HCA, Inc. update; Mr. Strachota said it should be out soon. There was general discussion of a building facility charge per ticket. Mayor Maxwell said a SOC average per ticket would solve a lot of the city's financial difficulty with HCA. Mr. Mielke noted the city pays all of the HCA Inc. programming staff costs, when originally they were only to pay the facility manager and maintenance. How to handle free admissions, school groups etc. is an issue. Ms. Johnson suggested a flat fee for a free event. Mr. Brausen suggested the charge-back with HCA, Inc. could be replaced by a $2/ticket fee. Mr. Strachota said the Lions kiosk is in the gallery. Ms. Jensen complimented Ellen on the • banners she made. Ms. Johnson suggested the Council go and thank the Lions as they meet on Tuesdays. General Consensus. Ms. Jensen asked that the complete lease be given to Council for study next time. The Council favors a building facility charge on tickets. Users need to be told there will be such a charge, they aze to be consulted as how to implement it. Council should discuss this again before going to tenants. Pavilion Mr. Strachota complimented the staff on how they coped during construction. They will have 5,000 sq. ft. new space to maintain. Mr. Olson said turf rent was higher than anticipated. Soccer will be using it more. Rentals bring more income than if they ran the programs themselves. Mezzanine rental will be a major focus next yeaz. Ms. Yager said her concern is that replacement costs for big-money items like the roof and ice system have no funds set aside. Ms. Jensen asked if a ticket surchazge would work; Mr. Olson said no as they rent, not sell tickets, and raising rent would be counterproductive. He added this summer the workmen said the roof was okay. A small leak in the Freon system for ice was fixed, it could last another 10 years. He noted the Pavilion was able to pay for its resurfacer. Mr. Mielke said that there are 2 philosophies about paying for long-term maintenance items. One is to sink money into a fund so the money is there when needed, the other is to wait and charge future users for those costs. Past Councils felt if something happened, then they would look at it. Mayor Maxwell suggested any income over a certain figure could be set aside; a facility replacement fund would be a good idea, even if it started with small amounts. Ms. Yager said the CIP fund started that way. Mr. Olson said the school starts with a temporary occupancy permit November 6. The elevator shaft floor was poured today. Mr. Mielke said Don is still talking to groups on acoustics. October 28, 2003 Page 3 The school is interested in adding locker space. Last Thursday the school board approved the mezzanine lease; they like the idea as it saves the school district money. Cable Ftutd Mr. Mielke said more is being spent than taken into the fund so the Council needs to make decisions or in a couple yeazs there will be no fund balance left to support what is in there. Now $87,000 is transferred out for HCA; special projects, $35,500; communications/liaison $36,000; newsletters, $20,700, Web and Razzle $52,300. Questions to answer are: Should the Art Center be funded from this source? Should communications stay here, go to the general fund, or be eliminated? How important is the web site? Ms. Yager said there is enough to keep going for one year, the Council does have some time to work a final solution out. Mr. Mielke noted choosing only one cut will make headway, but not solve the problem. General discussion followed. Mayor Maxwell felt backing off the web site would cost more in the end. Ms. Jensen thought if the ticket chazge works, HCA could be backed out next year; Mr. Mielke added perhaps HCA, Inc. could also take up more staffing. Ms. Jensen added they aze to be on a 5-yeaz program to beself-supporting; Mr. Brausen said they are working towazd that. Ms. Jensen felt communications could be done without. Ms. Johnson suggested stuffing utility bills with aone-page highlights instead of having a newsletter, apaztment managers could post it in their buildings to cover apartment dwellers. Answering Mayor Maxwell, Mr. Mielke said staff would have to route their own web content to the web staff member.. Ms. Johnson noted nothing about elections was put out by the city; Mr. Mielke says he is now asking for an outline of topics. Ms. Johnson asked that be shared with Council. Mr. Rowan said earlier this year he was told the Council chambers would require no more "big money." Ms. Jensen noted lots of people watch the telecast. General consensus was that the facility ticket chazge would help. The newsletter should be eliminated and a utility bill staffer started. The Communications Coordinator position would be eliminated, and the part-time position for the web site would be maintained. Budget and Tax Levy Summary; Budget issues Mr. Mielke went over the budget and tax levy summary with the Council. He noted the 2003 budget will result in $150,000 "excess funds." Mr. Mielke noted that the franchise fee ordinance is on the agenda for November's second meeting. He said "big picture issues" include: furloughs ;using reserves; lowering the tax levy (if so, use reserves, the $150,000 excess or furlough savings?); franchise fees (what level?); and expenses (should some go up or down?) Ms. Jensen asked if reserves are left intact could it be a future problem with the state. Ms. Yager said reserves are at the state-recommended levels. Mr. Mielke said enterprise funds seem to be the next tazget, such as the refuse fund. He feels the state will try to force consolidation with services, such as dispatch. To the degree the Council can designate funds, they should. Mr. Rowan said he felt any extra money should be used to stazt a facility replacement fund as discussed with the Pavilion programming. Ms. Jensen asked what the $150,000 surplus would mean if used to lower the levy. Ms. Yager said it would go down 2% and save an average homeowner $8/month. She added that the state could freeze the levy at the present rate into the coming yeaz, which would have a real impact then. Mayor Maxwell surveyed members about the issues. Mr. Mielke expressed concern that the furlough discussion exempts the police and dispatch and wants to explore ways to include them, so all employees aze treated equally. Mayor Maxwell suggested checking witlt the County to October 28, 2003 Page 4 see if the sheriff's staff could cover more if police aze furloughed. General feeling was not to use reserves other than the $150,000 left this yeaz. Ms. Jensen said she felt strongly any unallocated funds should go into a designated fund. All but Mayor Maxwell aze ready to move on a franchise fee. Council members agreed to discuss these issues by meeting at 6:00 before the next Council meeting, and staying late if necessary. If needed, they will meet again Thursday (November 6) evening. Ms. Jensen asked they get an updated list of budget issues. Other Mr. Rowan asked when the fence along Excelsior Boulevazd would be up. Mr. Mielke said it should go up this week. Mayor Maxwell asked what the conditions will be on Excelsior Blvd. this winter. Mr. Mielke said the intersection on Monroe should be completed, as well as the Blake intersection. Part of the roadway will stay only two lanes through winter. Ms. Johnson asked why patrol cars are sitting on Highway 169. She asked when 2°d St. NE would not be torn up. She found direct deposit couldn't be mandated. She talked to a city in Illinois and found a vehicle fee sounds like `a nightmaze. " Mr. Mielke commented it might not be legal here. Mr. Mielke said he has received a call from Brad Johnson asking about the intent of the gambling policy. A short discussion followed and it was agreed that the policy needs to be revisited.. Mr. Mielke said the 10% gambling fund issue is coming up, it could be done then. At this point Mr. Rowan excused himself. Mr. Mielke explained the issues involved about right of way and the Presidential Neighborhood alleys. Mr. Stadler's intention had been the green spaces would be vacated with utility easements for the sewer. Some area residents don't want it vacated, but if it is not, who will do the mowing? Consensus was to let Mr. Stadler work on it the next couple of months. The RV owner should move it off the right-of--way until the issue is decided. Vacating will be addressed later. Mr. Brausen moved adjournment. Ms. Jensen seconded. Meeting adjourned at 10:50 p.m. Kasey Kester, Secretazy