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HomeMy WebLinkAbout19931201_specialI. 85 MINUTES OF THE SPECIAL MEETING OF THE EDINA CITY COUNCIL HELD AT CITY HALT., DECEMBER1, 1993 - 7:OO P.M. ROUCALL Answering rollcall were Members Paulus, Rice and Mayor Richards. TRUTH IN TAXATION PUBLIC HEARING HELD FOR PROPOSED 1994 CITY BUDGET Pursuant to published notice given, a public hearing was conducted on the proposed property tax increase in the 1994 Budget for the City of Edina, as mandated by Chapter 375, Laws of Minnesota 1993. Mayor Richards stated that the hearing would focus on the proposed 1994 City of Edina Budget and the expenditures Council considers necessary to run the functions of the City. value of their homes should appear before the Board of Review which will meet in the month of April, 1994. He explained that the City’s final property tax levy and final budget must be adopted at a subsequent hearing following the close of the truth in taxation hearing. Residents with questions or objections to the market Mayor Richards pointed out that the following impacts can affect property taxes: A. B. The classification rate for Commercial/Industrial property was reduced from 4.7% to 4.6%. The value of Commercial/Industrial property declined from last year. The effect of these changes are: 1) the tax rate went up to offset the decline in the City’s tax capacity, and 2) a larger share of the tax burden will be borne by residential properties. C. Changes in value of property. D. E. Tax court ordered abatements. Minnesota‘s progressive tax rate structure on residential property. Mayor Richards informed the audience that the proposed 1994 Budget totals $15,182,301 which represents an increase of $710,486 or 4.91% over 1993. Presentation bv Assistant Finance Director Eric Anderson, Assistant Finance Director, explained that the major changes in the proposed expenditures increase of 4.91% included the following: 1. Wage adjustment of 2% 2. 3. Public Safety (Police & Fire) overtime - $20,000 4. 5. Fire Department Projects (health, fitness, and responsiveness) $7,500 6. $40.00 per month increase in employee health insurance/benefit package 1-494 Joint Powers Organization - $46,000 or $.lo per capita Contingencies - $75,000 increase (depending on potential projects chosen) He presented graphics detailing the following four issues: 1. 2. 3. Number of and budgeted expenditures for independent contractors. 4. Percentage of total proposed budget representing total compensation costs. Number of employees by general classification and whether full or part time. Effects of budgeted increases and decreases on proposed property tax levies. Mayor Richards then opened the hearing for public comment and discussion. Public Comment Greg Lebaron, 80 Woodland Circle, commented that, although the proposed budget 12/1/93 86 increase of 4.91% sounds reasonable, it has to tair liability inZ3rease of 19.2%. He suggested needs to be reworked so that the tax liability responded that most of what appears on the tax be out line because he is facing a that the proposed 1994 Budget is decreased. Mayor Richards statement is beyond the Council's control. protection, Parks and Recreation, Public Works and Administration. Mayor Richards said that he believed the Council has been holding the line on the number of staff and has not engaged in new programs. Mary Kaye Covey, 6112 Jeffrey Lane, asked questions about the total number of employees, cost of proposed salary increase and total benefit package. Staff responded that full time employees numbered 192 in 1992, 189 in 1993 and 190 are proposed for 1994. Total benefit package in 1993 for non-union employees was $250.00 per month. Ms. Covey then asked about non-City expenditures. Mayor Richards explained the major items proposed under non-departmental expenditures in the Human Relations Commission budget totaling $60,250.00. are line items of $7,000.00 for July 4 fireworks and $14,500.00 for South Hennepin Regional Planning Agency services. He explained that the basic functions of the City are Police and Fire In addition, there Fritz Sander, 5121 West 58th Street, asked as a taxpayer where he could go to put some pressure on people to get the tax liability under control. explained that the City is a member of the League of Minnesota Cities (LMC), the Association of Metropolitan Municipalities (AMM) and the Municipal Legislative Commission (MLC). The MLC is an organization of approximately 15 cities similar to Edina who present a unified voice to speak to the State Legislature about issues such as disparities with outstate cities and in receiving no intergovernmental aid. immense wealth and should not complain. School District has a very large impact on taxes as well as Hennepin County and individuals can contact those officials as well as our state legislators. Mayor Richards He said the general perception is that this community has Mayor Richards pointed out that the Gayle Laurel Anderson, 7000 Wooddale Avenue, said that as a senior citizen she is trying to stay in her home. However, social security together with the current low return on investments do not keep up with the increase in property tax. suggested that there be a 'hold' on tax increases for senior citizens that have very limited income. Skip North, 5804 Hanson Road, said he looked at the compound growth rate over the last seven years for the various components on his tax statements. He noted that the schools have been growing the fastest; in third place is Hennepin County, but in second place is the City. Even though the City's portion of the tax dollar is small, the tax rate still is growing second fastest which he said is of concern. In the case of the City, Mr. North pointed out that by adding an eighth year at the suggested increase the compound interest rate for the eight years takes a 20% jump. He said something has to be done. She Member Paulus interjected that the proposed 4.91% increase in expenditures for 1994 is basically to keep the City afloat as well as putting money back into contingencies so that the City's bond rating remains at AAA. salaries, Edina is somewhere in the middle with other similar municipalities. She said she felt stymied because citizens want more Police protection and the current level of other services maintained. Member Paulus said it would help if residents would say what specific items should be cut from the proposed budget. Regarding employee Ione Winter, 6504 Creek Drive, asked what the proposed employee benefit of $40.00 per month would include. Staff responded that, basically, it would cover the 7% to 11% increase in cost of health care. The total package includes health care, life insurance, optional dental insurance and long term disability. Hayor Richards noted that Edina ranked 40th of 44 cities concerning employee benefits. 12/1/93 87 Philip Johnson, 5045 Yvonne Terrace, said that while the City's proposed 1994 .Budget shows a 4.91% increase, it reflects a 16.1% increase on his tax bill. He said, although he did not know where to draw the line on expenditures, he felt the main reason for his increase in taxes was because the market value of his house increased by 6.1% while other properties decreased. I Member Rice spoke to the severity of the decrease in valuation of commercial real estate. Some of the multimillion dollar properties in Edina have dropped 30, 40 and 50 percent in valuation, i.e. office buildings which represents a lot of tax money. He reiterated the plea of Member Paulus that citizens tell the Council specifically what should be cut from the budget. many hours looking at the line items with staff and agreed that the tax system is comp 1 ic a t ed . He said the Council had spent Ken Joyce, 4239 Lynn Avenue, told Council that he has been retired for ten years, is living on a fixed income, and his property taxes have increased over 17%. His concern was that if he lived for another ten years and these increases continued what would he have left to live on. Paul Green, 6945 Southdale Road, suggested that the City be run like a business and that businesses have been down-sizing in order to get along. concerned that next year he would see another large increase in his taxes. He asked if fees charged by the City have kept up over the past 10 years to the increases on residential property. oriented community with a philosophy that those who use services should pay for those services. The City has made sure that fees match the cost of providing those services that are fee related. Continuing, Mr. Green said he felt the City should consider a 10% reduction in number of employees because cost of employees is 60-70% of the budget. He also suggested that the City fight the abatements on commercial property. He said he was Mayor Richards said that Edina is a fee Giovanna Hoyland, 60th and France, asked what determines the commercial and industrial real estate values reduction and what process they used to get those values lowered. Member Rice responded that all office properties have gone down 30 to 40% over the last few years because there is too much office space and not enough people who want to rent it. appealed right to the judicial system. lowered if you purchased a home at a price lower than its assessed market value. Member Rice said that assessors know what is happening because every time a piece of real estate is sold a certificate of reasonable real estate value (CRV) must be filled out at closing. approximately what properties are worth which is taken in consideration when determining assessed values. Commercial property values are generally Ms. Hoyland asked if taxes would be Those CRVs go into the system and assessors know Gary Sampson, 6408 Limerick Lane, commented that in this economy companies have not been able to give wage increases because they have not been profitable. He said that also applies to the City of Edina because of the commercial property valuation reduction. the highest cost for the City. He submitted that the City has better equipment now for plowing and the streets are in good shape so the City should be able to get by with less employees. Consequently, salaries costs should be cut because that is Ross Dunlop, 6328 Barrie Road, questioned the following line items in the proposed 1994 Budget: p. 104 Colony Way Lighting $5,000 and p. 10 Dues and Subscriptions $44,500. AMM and LMC mentioned earlier that lobby the Legislature on issues impacting the City. He said that effort was instrumental in getting the Legislature to eliminate the third tax tier. Mr. Dunlop suggested that the Council look carefully at each line item in the budget. Mayor Richards said the $44,500 is for dues to the LMC, Member Rice said the Council has 88 12/1/93 already done that scrutiny as the budget process begins in July of each year. All such meetings are posted and are open to the public and residents can call City Hall and ask for those dates. Mary Kaye Covey suggested that the dates of those hearings be published in the About Town magazine which is sent to each residential address because many do not get the Edina Sun-Current. participate with other communities. Police and Fire protection should not be cut but that other positions and salaries should be cut across the board. She added that Edina should not have to compete and With regard to cutting employees, she said Gayle Anderson asked if the real estate tax money is wisely invested when received by the City. investment of short term working capital. some endowment fund that would benefit the City. donations can be made to The Edina Foundation which has funded a lot of good projects for both the City and the Schools. obtained from the City Manager's office. Mayor Richards said the City does get competitive bids for Ms. Anderson also asked if there is Mayor Richards said that Information on the Foundation can be Mayor Richards asked for any further public comment. heard. No further comment was Member Rice made a motion to close the public hearing on the proposed 1994 City of Edina Budget and proposed property taxes. Paulus . Motion was seconded by Member Ayes: Paulus, Rice, Richards Motion carried. I Mayor Richards announced that the City Council would meet on Wednesday, December 1994 City of Edina Budget and final property tax levy. . 8, 1993, at 7:OO P.M. in the Council Chambers for the purpose of adopting the Mayor Richards then declared the meeting adjourned at 8:37 P.M. -54&* a City Clerk