Margit Johnson, LWV Observer
All members were present.
Dollar signs were front and center for much of the work session. City Administrator Joel Walinski led the discussion about updating fees for services throughout the city. New fees include a liquor license for an establishment serving until 2 AM, a penalty for late liquor license applications, proctoring exams and out of state genealogy searches at the public library, and a percentage of the lodging tax for city administrative costs. Walinski pointed out that it has been quite a while since fees were raised to offset increased administrative costs.
Staff anticipates that council members will hear from landlords when the cap for inspection fees is replaced by a $10 inspection fee/unit for rentals over 11 units. Some landlords of large apartments will be looking at inspection fees well above the current $365 cap. Council members hoped that landlords would be adequately notified of the changes before they go into effect.
Council members briefly discussed fee policies, using fees as incentives for economic development, environmental protection, or good behavior on the part of landlords. In short, dollars in the form of carrots or sticks.
Utility rates were the next item of business. Donohue & Associates have been hired by the City to review the municipal utility enterprise funds – wastewater, water, and stormwater. Seldom do we think of “sales volume” when we turn on a faucet for water. But the City is in the business of selling water and its treatment. Generally their sales revenues are dropping while their expenses are increasing. The goal of the Donohue & Associates study is to recommend an equitable generation of revenue, while addressing capital costs and encouraging water conservation. The consultants recommend that enterprise funds should pay for themselves, but rates cannot be too high, or demand will continue to decline. Rates also need to raise revenue for future capital improvements, such as a new water tower or improved waste treatment plant. Donohue & Associates will return in August with January 2010 rate adjustment recommendations.
Finance Director Kathleen McBride provided the council members with a sneak preview of the 2010 levy projection. Her PowerPoint presentation reminded the council that Northfield’s tax base is projected to decrease 5.5%. The bottom line will be that the property tax rate will increase even without a levy increase. The trifecta of decreased Local Government Aid plus the state-imposed levy limit plus the tax rate increase per household put a real strain on the 2010 budget. Staff is looking for direction from council members on their appetite for increasing the property tax. If they have no appetite for an increase, then what are they willing to cut from the city budget?
Moving beyond dollars and cents Walinski announced that the “skateboard park is back and better than ever!” Half of the Babcock Park parking lot has been paved. Skateboard enthusiasts and their supporters plan to install some elements and used equipment on Saturday, July 18.
Meanwhile the council members were given a matrix of skateboard park locations, which they refined and approved for use before the end of July. Each of them will score the 8 named parks, pool their individual responses, narrow the choices, and then check with the skateboard coalition for “buy-in.”
The last item on the work session agenda was an update from IT Director Melissa Reader about the fiber optic task force findings. It appears that Northfield is too wired to meet the federal stimulus grant requirements and too close to the metro area for the Rural Utility Service grants. If the City chooses to pursue fiber optic, a low interest loan may be the most realistic form of financing. Council members discussed continuing to find a partner, going it alone and hiring a manager, or hoping that a private entrepreneur would launch a city-wide broad band service. There were no conclusions, but eternal hopes that a city-owned system could yield more utility enterprise funds. Additional direction to the staff and the task force is needed for the next phase of this issue.
Comments
Thanks, Margit, for your clear and comprehensive account of the work session. Will the staff provide the council some suggested ways cuts might be made, in order for them to weigh these against tax increases? It sure doesn't look like a good time for a referendum on funding for a safety center, eh?
Jane, you have big shoes to fill, but those of us holding down the fort are trying our best!
Kathleen McBride and Joel Walinski were in an explanatory mode about how the tax levy works (debt service lies outside of that levy, etc.) and girding the council's loins for more challenging decisions later. No mention on Monday about specific ways to cut.
The NCRC bond ends in 2010, which opens up bonding capacity for other projects - in theory.
I am sure the discussion will be hot and heavy by the time you return to your chair, laptop in position.
Margit: Thanks so much for taking over for me, taking over for Jane. I like the narrative style; a bit more lively and still very substantively informative.
I have a question about the wastewater fund: it used to be that there was always a huge balance in there to cover future costs... not the case anymore?