cp01-30-86 cA G E N D A
CITY COUNCIL SPECIAL MEETING
THURSDAY, JANUARY 30, 1986
I. 6:00 - 7:00 P.M. - Meeting with Proposed Police Facility Architect
Robert Lambert, Thorbeck & Lambert, Inc.
II. REPORTS:
7:00 - 7:10 P.M. - Police Chief
7:10 - 7:20 P.M. - Fire Chief
7:20
- 7:30
P.M. -
Fire Marshall
7:30
- 7:35
P.M. -
Building Official
7:35
- 7:40
P.M. -
Liquor Store Manager
7:40
- 7:55
P.M.
City Engineer
7:55
- 8:00
P.M. -
Personnel Coordinator /Transit
8:00
- 8:15
P.M. -
Parks & Recreation
8:15
- 8:30
P.M. -
Community Development
8:30
- 8:40
P.M. -
City Finance Director
8:40 - 8:50 P.M. - Maintenance Operations
8:50 - 9:30 P.M. - City Administrator
9:30 —10:00 P.M. - Performance Reviews
ADMINISTRATIVE
UPDATE
JANUARY 28, 1986 CITY OF HUTCHINSON ISSUE NO. 2 -86
CITY FINANCE DIRECTOR TO PRESENT SPECIAL REPORT
Before the Council considers any items involving expenditures (merit requests, contingency
requests, etc.), I request the Finance Director be given the opportunity to make a presen-
tation regarding the Governor's budget cuts and our local recommendations. Also, please
see attached Action Alert.
COALITION OF OUTSTATE MEETING
Last Friday Paul Ackland, Ken Merrill and myself attended the Coalition meeting. It per-
haps was one of the best organized meetings I have been to for quite some time. Serious
consideration should be given to continuing within the organization based on the lobbying
in the area of potential state cuts. Other areas discussed included tax increment financ-
wand city /township relationships.
JOINT MEETING SCHEDULED - STATE MUNICIPAL BOARD DIRECTOR TOWNSHIP AND CITY OFFICIALS
On Friday, February 7, at 11:00 A.M. in the Council Chambers, Terry Merritt of the State
Municipal Board will discuss:
1. Orderly Annexation Agreements
2. Alternatives for a Joint City /County /Township Planning Board
CHANGE IN LEAGUE OF CITIES ANNUAL CONFERENCE
The League of Cities has changed the date and location of the LMC Annual Conference. It
will be in Duluth this year, June 17 -20.
LEAGUE OF CITIES - 1986 LEGISLATIVE ACTION CONFERENCE
The annual League Legislative Conference is scheduled for Wednesday, February 5, at the
Radisson Hotel, St. Paul (Kellogg Boulevard). Traditionally the Mayor, Council member(s),
and certain staff have attended. Marilyn Swanson will be contacting you to see if you
want to attend.
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-OVER-
ADMINISTRATIVE UPDATE
JANUARY 28, 1986
JANUARY 30 - SPECIAL COUNCIL MEETING - 5:30 P.M.
The time span from 5:30 - 7:00 P.M. has been reserved for a meeting with the recommended
architect for the new police station. His name is Bob Lambert.
The Directors' reports will be distributed tonight. Please start to review them. This
portion of the meeting will start at 7:00 P.M. Supper will be provided.
CAUTION OR WARNING LIGHTS - HIGHWAY 7 WEST AND SCHOOL ROAD
Mallow Priebe will be providing an up -to -date report on his correspondence and verbal
communications with DOT and Hutchinson Utilities on the request for warning /caution lights.
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041144[1] 1or.
league of minnesota cities
January 23, 1986 �� JAN19g
TO: League Board of Directors and mVFD
Mayors, Managers, and Clerk-4
FROM: Diane Loeffler
Legislative Representative
RE: Governor's Budget Proposal
Revised revenue and expenditure forecasts for the state were
released today along with Governor Perpich's recommended budget
revisions. Tne latest forecasts for the biennium indicate a
$720 million shortfall. Governor Perpich has recommended
that $380 million be cut from the appropriations approved last
• spring. Unfortunately cities are heavily impacted by those
cuts.
Tne General Approach
Tne Governor has recommenced retention of $100 million of the
budget reserve in case their estimates are again proven too
optimistic. The remainder of the budget shortfall is dealt
with through expenditure cuts. No state tax increases are
proposed. Most budget items are cut 3.50P for the biennium.
However, because we are already more than half through the
first year of the biennium, the practical reality is that it is
a 7.Op cut in the last year of the biennium for most programs.
Education is cut only 2.5% on a biennial basis.
1956 Local Government Aid
Cities will lose approximately 8.1p of their 19S6 LGA payments.
Because cities have already received their local government aid
from the first year of the biennium, all cuts must be takes:
from the calendar year 1986 LGA payments (state fiscal year
'37). The cut represents loss of 3.5' of the biennial total for
LGA plus an additional cut of $4.2 million which represents a
3.50 out of miscellaneous credits and expenditures (pension:
aid, wetlands credit, enterprise zone credits, etc.).
This 8.1% cut in LGA means that overall funaing to cities will
• be less than it was in 1985. The administration proposes that
all cities have their previously certified 1986 LGA reduced oy
8. 1%. The result of this is that grandfathered cities will
1 83 university avenue east, st. paul, minnesota 551 01 (612)227-5600
receive cuts from their 1985 level of 8.1% and that only those
cities who were certified to receive close to the maximum
increase of 12% in 1986 will realize any real growth.
Future LGA
The The19986Leoislature must set LGA levels for 1987 so that they
can be certified prior to cities setting their levies in the
fail. The Governor has recommended only a 3% increase for 1987
over the reduced base.
Homestead Credit
The Governor has recommended that homestead credit payments to
local governments in 1986 be reduced by 8.78 %. This represents
a biennial reduction of 3.5% applied in one year plus a 3.5%
biennial reduction in the circuit breaker property tax refund
program. This reduction would be implemented by each
jurisdiction's scheduled payment being reduced by 8.78 %.
In order to make state costs more controllable, it is being
recommended that in 1987 (state fiscal year 188) the total
homestead credit appropriation be capped at the 1986 level
prior to the reductions.
Payment Schedule
In order to improve the state's cash flow and help eliminate
the need for the state to do short term borrowing, a revised
LGA and homestead credit payment schedule has been proposed.
Cities now receive these payments in six equal payments each
month from July to December. It is proposed that, beginning in
1986, cities receive payment for these programs in July and
December. Because the first payment would be equal to three
months of payment under the current system, interest earnings
on the larger first payment would theoretically balance out any
borrowing costs incurred waiting for the second payment. It is
important to note that the administration has agreed to an
appeals procedure for cities experiencing cash flow problems.
Motor Vehicle Excise Tax Transfer
Almost
0 million in
savings is realized by the Governor
recommending
that no motor
vehicle excise tax transfer be made
from the
general fund
to the transportation funds. This will
result in
the following
program reductions:
F.Y. 1986
F.Y. 1987
TAF
$13,165,100
139399000
Tk. Hwy
24,486,800
24,922,100
CSAH
11,453,600
11,657,100
MSAH
3,554,700
3,6179700
Almost $13 million from the general fund would be provided each
year for the Transit Assistance Fund.
0
Other programs
In general, ali programs will be cut 3.5% on a biennial basis.
No specific information is available yet on how these cuts
would be implemented in individual grant programs. While the
Finance Department has asked state agencies to not seek to
alleviate the cuts in their agencies through new or increased
fees, it is to be expected that these will emerge as policy
options.
Clearly cities have been asked to absorb a major share of the
budget problem. As you are aware, it is very difficult to
respond effectively to major cuts in a year already budgeted
for. Cities are already having difficulties due to the major
cutbacks in Federal Revenue Sharing and other federal programs,
declining taxbases, costs such as insurance rising faster than
inflation, and implementation of comparable worth studies. It
is important that city officials communicate these problems to
their legislators and the Governor.
The League Board of Directors will be meeting next week to
consider appropriate policy and lobbying steps. We will
continue to keep you informed as new information becomes
available. Additional information and analysis will be
available at the Legislative Conference on February 5th.
Time has been scheduled in the afternoon for you to visit with
. your legislators. Please plan on attending and meeting with
your legislators on the budget and other pressing concerns.
•