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SPECIAL MEETING OF THE COUNCIL OF THE
CITY OF NOVI Mayor Landry called the meeting to order at 8:30 A.M. PLEDGE OF
ALLEGIANCE ROLL CALL: Mayor Landry, Mayor Pro Tem Gatt, Council Members Crawford, Fischer, Margolis, Mutch, Staudt ALSO PRESENT: Clay Pearson, City Manager, Tom Schultz, City Attorney, Kathy Smith-Roy, Finance Director, Randy Auler, Director of Parks, Recreation and Cultural Services APPROVAL OF
AGENDA CM-10-04-060 Moved by Margolis, seconded by Gatt; CARRIED UNANIMOUSLY: To approved the
Agenda as presented. Voice Vote Roll call vote
on CM-10-04-060 Yeas: Gatt,
Crawford, Fischer, Margolis, Mutch, Staudt, Landry Nays:
None PURPOSE OF SPECIAL MEETING – 2010-2011 CITY OF
1.
Overview Mayor Landry
gave the overview of the budget process stating the budget could not be
adopted today as there needed to be a public hearing. He said the ultimate
end to these budget discussions would be a balanced budget that created an
environment for economic development.
Mr. Pearson explained that the budget presented was $1.5 million less
than the previous year and $3.5 million less than two years ago. He noted
the General Fund was balanced and the Rainy Day Fund was within the range
14% -18% at 17 plus percent and an additional $850,000 had been put away to
start off the next fiscal year in 2011-2012. He said there were a few
Capital projects included in the budget such as modest park improvements,
road work centered around matching Federal grants, neighborhood roads and
the meat and potatoes of Novi City government was alive and well.
He said Capital projects beyond this year would not be aggressive but
they would be able to ride that through because they had done a lot of
investment in equipment. So, after review, there would be very few Capital
items over the next five years.
Regarding parks, since they had centralized Field Services with DPS the
Parks Fund didn’t have as many direct expenditures.
He said they were building a fund balance in Parks and Recreation so
they would be able to do some parks Capitals down the road on a pay as they
go basis. Mr. Pearson said the
Judgment Trust Fund had been built up over the years and he recommended
moving a portion of that balance back into the General Fund.
He said the main thing that was different, based upon conversations
about the whole budget, was a keen interest in getting additional savings
that could be realized sooner rather than later towards budgets beyond
2010-2011 and to provide some benchmarks and targets in terms of savings
during this next fiscal year.
Mr. Pearson suggested going back into the 2010-2011 budget and amend and
adoption by Council to have another $450,000 in savings partially from
updated penalties and interest and there had been reconciliations of
property tax penalties and interest of $154,000 per Kathy Smith Roy
said they had been very conservative in preparing the budget.
She said the property tax revenue in tribunal cases had been an
ongoing discussion and issue.
She commented there were reserves set up in the General Fund in terms of an
estimated number, which was approximately $300,000 less than where they were
at today. In addition, they
already had in their liability set up $300,000, so there was a total of
$660,000 set up toward potential taxable value loss from cases in the tax
tribunal. She felt that was
conservative and more than appropriate for what they needed moving into the
next year. Ms. Smith-Roy said
they were also facing issues related to pension costs and other costs in
personal services that actually made it appear that they had not made enough
reductions. However, in fact,
some of those were one time items that would hit them as they made
reductions in staff. For
example, there was $105,000 in unemployment costs in this budget in the
estimated and for next year. The
other item was pension costs, which were increasing for a variety of
reasons. She said there was a
$300,000 increase just for some increases in benefits that would occur June
1st. Ms. Smith-Roy noted in
addition to that there were some closed groups and plans and as a result of
that for the long term, the pension costs would decrease but short term they
were realizing some increases now.
She said that equated to an additional $165,000 for a total of
$300,000 increase since they closed those plans.
a.
Introduction 2.
City Council discussion and decisions regarding the plan priorities Member Staudt
said reductions were critical for future budgets into 2012-2013 and it was
important to look out that far and it was good to see a two year approach to
this budget, which really called out the third and fourth years more than he
had anticipated. He said this
was a process in right-sizing the City in the future, which included
reductions in the work force and hopefully not significant reductions in
services. He commented it was
clearly leading into next year’s budget, which would also need some
additional cuts because the reductions in tax revenue were not going away
and with the projections they were seeing, it was going to continue. Member
Staudt said downsizing the City didn’t mean that they could abdicate their
responsibility to continue Capital investment in infrastructure. The City
still needed to invest in Parks and Roads and other things.
He said while making reductions in personnel they had to be mindful
of their responsibility to continue to make these Capital improvements in
the City for the long haul. Regarding all the fund balances and special
funds, he thought it should be used as a tool to monitor their success in
balancing the budget at true operating costs.
He said they couldn’t anticipate major inflows of funds into the fund
balances in future years; so they had to be extremely careful in managing
those dollars and using them prudently.
He said they were the financial backbone of the community and it was
absolutely critical that Council keep them in mind whenever they were making
decisions because those funds would become critical to the operations of the
City in the future. Member
Stuadt said reductions in work force would derive exponential benefit on the
Fund Balance once those changes were made and they must be made now.
He said they would derive probably $800,000 or $900,000 of benefit
from those reductions. He
thought they were unique in that these types of reductions had been made
without public handwringing. Member Crawford
said she was very appreciative of staff’s time and effort looking at every
single thing that they do in the City. She
said this was probably the most challenging of all their budgets.
She noted staff looked at everything from cell phone plans to
eliminating meals from travel plans.
She also thought the options for tier development were good because
every 3-6 months, it was good to review all these items. Member Crawford
stated she was very pleased that they were positioning themselves for grants
because they had been very successful with grants and that they had
themselves positioned to capture whatever monies that existed.
She said she supported staff training and development as she knew the
City was down 27 positions from two years ago and down 15 from last year.
She noted wages were flat overall and that was done in this budget and they
were continuing to negotiate for reductions and suggestions to make jobs
different. She said she didn’t
think they could compare the staff wages with other communities because the
duties were very different now that they were being combined and shared.
Member Crawford said it didn’t bother her that the wages were
different than surrounding communities because the positions were different.
Mayor Pro Tem Gatt felt the budget
sent to Council last week had a lot of problems and a lot of holes.
He said it was balanced but thought it was balanced on a lot of one
time fixes. He said they did
take money from certain funds and plugged them into the General Fund and
didn’t give a clear look toward the future.
However, that was all changed last night when the emailed memo
arrived from Mr. Pearson and his staff that amended some figures and really
attacked the problem. The problem was revenues had decreased and there was
no clear cut reason to believe that revenues would increase in the not too
distant future, property taxes would not increase, State Shared Revenue
would not increase and certainly they were not going to ask taxpayers to pay
more money. So, the revenue
would stay stagnant and go down and the only way to balance a budget and
move toward the future was to do what Mr. Pearson and his team was now
suggesting in the tiers. He said
the only difference he had with what was proposed and what he was going to
say was how they would get there.
He said they needed to reduce the budget by $1 million to $1.5
million and they needed to do it right away so they were not looking at
kicking the can down the alley for next year’s problems to manifest itself.
He said Mr. Pearson’s proposal would do that.
However, it was at the expense of a lot of people.
He said they talked about numbers, which were important, but he
didn’t want to forget about other numbers like people’s mortgages, car
payments, tuition payments and life. He said if they eliminated 13 or 14
positions from the work force, it would balance the budget and move forward,
but they would have devastated a lot of lives. He stated in January he had
said that the employees of the City had to be a part of the solution and
they do because most of government expenses were made up of employee costs.
However, to eliminate that many
positions without attempting another route was something he thought they
should talk about. Mayor Pro Tem
Gatt said if they reduced everyone’s wages by 5% by July 1st from
Mr. Pearson down to the lowest paid newest employee, they would save $1.2 or
$1.3 million. Then if that savings was accomplished, and everything else put
into place including not filling spots that were open and the natural
attrition that would occur during any given year, they would position
themselves for the next budget year and the years to follow to be in much
better shape. He noted they
would accomplish the same thing as the tier cuts.
He said he was aware that unions were
involved and he was not certain that they would agree to a 5% wage
reduction. He said he certainly
wouldn’t want to impose that reduction on Administrative staff who didn’t
have a say in it without the union’s buy in.
Mayor Pro Tem Gatt said he would propose and hope that they could
talk about at least going to the unions and asking if they were interested
in that and if not, he would be the first to raise his hand and say they
needed to move forward with the tier proposals Mr. Pearson put forward.
He said they had to get there, that’s their job as a Council, it’s
their elected duty to so, but he hoped Council realized there was more than
budget numbers at stake here. It was a lot of employees who, if laid off,
had little hope to find employment elsewhere in this State.
He said they could accomplish the
same thing and all he was asking was that they look towards asking the
unions for their buy in. If they
said no, and he wasn’t talking about the union heads, he was talking about
the whole group and every group individually, then Council would move
forward with a clear conscience. He
thanked staff and Administration for coming forth in the last 48 hours with
a proposal that really tackled the issue because the budget received by
Council last week had a lot of problems.
He asked that they think about it and come to the same end but in a
different manner. Member Margolis
said she appreciated comments earlier about how a team worked together to
accomplish a goal. She said she
liked working with a competent team who had real discussions about different
views about how to accomplish something. She believed that projections were
important but the main thing she continued to do with business clients was
strategic planning, which was a challenge of continuing to look forward but
also preparing themselves that things would change. Member Margolis thought
it was important to stay in the present time, plan for the future and then
be ready to make adjustments as things move along. She felt the budget
helped Council get a better idea of what happened in the City as the numbers
told a story. She said the
questions asked included oversight of the budget and answers give the clear
direction. Secondly, the questions
give Council a chance to show the Administration where their concerns were
and that they were all listening to each other. She said it showed that the
trust she had in staff to run the City was well founded. Member Margolis
said every year they present a balanced budget and she trusts them to do
that and this one is a solid budget. She commented she was stunned that
another $1 million would be put into neighborhood roads next year and
thought it was impressive. She thought in these economic times that was very
important. Member Margolis said she didn’t disagree, in principle, on the
idea of giving employees the opportunity to have a couple options instead of
cutbacks. However, she felt the
City Manager and Administrators should have some discretion for personnel
cuts. She said her problem with
across the board cuts was that she didn’t care how efficient of an
organization they had, there were people that worked a lot harder than other
people. She thought it was less
common here but that was the reality.
She agreed with Mayor Pro Tem Gatt’s talk about not bearing the brunt
of the cuts on the back of the Administrative employees just because they
could because that was incredibly demoralizing. She thought they did have to
do things across the board but thought they needed to have some discretion.
She said for the majority of employees in unions, and it was either layoffs
or cutbacks for them. She said
rather than mandating 5% across the board she would rather say they were
really interested in cutting by this amount and give some discretion and
direction to the Administration to say some could be layoffs, depending on
which it was, and others, it might be more appropriate to ask for an across
the board cut. She wanted to
look at that and maybe do it in a finer way than an across the board cut.
Member Margolis said it was tough to get a new job in this economy
but the reality was that the ones who could get a new job were the most
effective ones and the best employees.
She said she would hate to be in a position where it was the people
who had gotten the City to this place, because they were the best, end up
leaving for those kinds of reasons.
Member Mutch
noted as fortunate as they were to have the kind of budget that they had
currently with some of the additional funds that were set aside, looking
forward, they really had
significant challenges facing the City.
He said it was not a matter of whether they were going to cut or not,
but a matter of when. Member Mutch said they could take advantage of an
opportunity they had today, which was the benefit of having the time and
opportunity to start making adjustments to the ongoing operating costs that
drive the budget numbers. He said making those adjustments would not be easy
and it was not fun especially when talking about lay offs or reducing
services. However, they were
necessary to go forward as an organization, as a City to be able to operate
in a proactive mode in the actions they took. He thought that had been the
sentiments expressed at the Council table. They needed to take the necessary
steps to get to a point where down the road they could continue to function
and operate as a City. He said
they didn’t want to be in the position that many communities were where
there had to be emergency meetings of Councils, residents outraged or
panicked because of major cuts in core public services.
He thought they could continue to provide the core services and those
services that made Member Fischer commented he was very impressed with the thoroughness of the budget document. He believed it had a foundation for fruitful discussion from Council and it shed light on where they planned to go and what they needed to do. Member Fischer believed they used very conservative estimates in a lot of the budget documents. He felt that the line item expenditures and revenue estimates and thought they were very conservative and it was always good to err on the side of caution. Member Fischer believed they struck a balance for the 2010-2011 budget and for looking into the future. He said it was impossible to plan too far out and he found that when they couldn’t really pinpoint where things would be down the road, they were just adding a 3% inflation factor. He thought they struck a balance by not tying the Administration to looking too far into the future, so the tiered approach would handle that. He commented he was comfortable with the proposed 2010-2011 figure of the high end of 17% for Fund Balance. He knew the Administration would be mindful of hiring, attrition, etc., as the Council would look at benefits and promotions within the City that as long as they were mindful of their obligation in the future budget years, he thought they would be OK. Member Fischer said he was a little nervous that they were looking at a minimum but, again, that went back to the conservative estimates. He said he would and thought Council would ask the Administration to bring that percentage up. He said he was not in favor of across the board cuts and felt they were very unfair and they didn’t allow the Administration to make strategic decisions, which was why Council had a City Manager here on a day to day basis to do. He said it was the City Manager’s job to find out where they could make strategic cuts when necessary. He thought across the board cuts hurt employee morale and didn’t address the fundamental problem underlying the City as far as right-sizing the City. He said when they were doing across the board cuts they were not right-sizing the City. He said he could not be in support of that. Member Fischer thought if necessary, they could move forward with the tiered approach given to Council. He thought the Council had been very mindful of continually reviewing benefits and thought they would continue to do that and that was how they should continue to address future problems. Mayor Landry
noted concerns that had been stated, by members of Council, the
Administration and residents and he wanted to address them.
He said the first was Fund Balance.
He said it had been stated “my God, the City’s burning through its
Fund Balance” or “they’re balancing this budget using our Fund Balance”.
Mayor Landry discussed how they had used Fund Balance, in the white
book on page 24 there was a summary of Fund Balance.
He said July 1, 2009 there was $10.3 million in Fund Balance.
He noted the expenditures this year were $30 million, so if they had
not used any Fund Balance this year it would be 33%, which he felt was too
high. Mayor Landry said these
were tax dollars and he didn’t think they could tell residents their roads
couldn’t be paved etc. while keeping one third stashed away in the bank.
If looking historically, they had done that every year that he had
been here. He stated that last year and in previous years, the Fund Balance
was mostly in the 20% to 30+% range. He said he didn’t see anything wrong
with using Fund Balance dollars every year and thought it was appropriate.
He commented he didn’t think it was a matter of burning through Fund
Balance to balance the budget.
Mayor Landry said hand in hand with this there had to be a policy of what
they felt comfortable with maintaining in the Fund Balance.
He said he was very proud that this City Council made a decision two
years ago to increase it from 8% to 12% to 14% to 18%.
He said there was a lot of time spent discussing the 14% to 18% range
and he thought that if, as an organization, they agreed to a range as
opposed to a number, then he thought as long as they were within the range
they should be satisfied. Mayor
Landry said the next concern was the expected revenue, which would decrease
and were what he called the page 217 reality figures. He said the reality of
these figures was for next year and it looked like the City would be $1.1
million short, 2012-2013 it would be $3.9 million short and this was a very
legitimate concern. He agreed
with Member Mutch that they had to be proactive and not reactive.
Mayor Landry said there was also something else on page 217 they
should be aware of and that was the track record of the Administration. This
Administration from the 2008-2009 to 2009-2010 budget decreased expenditures
$2 million and this year they were decreasing expenditures as the proposed
budget $1.5 million. He said
they had done it looking at these numbers, $1.1 million, $3.9 million but
this Administration had done $2 million and $1.5 million and decreased
employees by 10% over the last 2 years.
He said it was important how they got there and it had to be a fair
process, but fair to who? He said it had to be fair to the City because they
had an obligation to maintain City services as best they could. Mayor Landry
said at budget time they always seemed to focus on expenditures, but that
was only half of the budget process.
He said the other half was revenue; so he thought they had to make
sure they had a well educated and well trained staff, state of the art
communication between businesses and residents. He said if they were going
to be a world class City, then they had to have a presence around the world
whether it was the web site, economic development people attending
conferences in Mayor Landry
stated he had a recommendation that he thought addressed Fund Balance,
expected decrease in revenue, ability to maintain the core functions and
start on the road to concessions.
First, he talked about the outlook.
He said 2010-2011 revenue, $26.9 million expenses as proposed $28.5
million and there was a deficit; how would they get there.
They would use $1.5 million in Fund Balance, which was projected.
He said they had $1.4 million left over from 2008-2009 and it was
proposed they save $850,000 of that for the future.
He said look at this year and as proposed they would use $1.5 million
in the Fund Balance and they would have a balanced budget this year.
He said next year, 2011-2012 revenue $25.5 million and if the
expenses didn’t change they would remain at $28.5 million, which meant they
would be down $2.9 million. He
said that was what they would be facing at the Council table one year from
now. Mayor Landry said they
might have $850,000 so they would be looking at $2.1 million.
He said three years out, 2012-2013 revenue $24.8 million if the
expenses stay the same and were not cut, they were at $28.5 million and they
would be down $3.6 million.
Mayor Landry said that was the outlook and the problem they had to address,
something had to give. He said
here was how he suggested they do it. Mayor Landry said going back and
looking at the numbers this year, 2010-2011, revenue of $26.9 million,
expenses $28.5 million. He
suggested they immediately cut $400,000 and the City Manager told them how
they could do that immediately before July 1st.
He said make the changes that bring expenses down to $28.1 and that
meant this year the shortfall was $1.1 million. They did use Fund Balance
but $400,000 less of it and this year was balanced. He suggested they tuck
away the $1.4 million left over from 2008-2009 and not use any of it. He
said next year, 2011-2012, revenue $25.5 million, which was $1.4 million
less than this year but they had the $1.4 because they tucked it away.
So, next year they use that $1.4 million.
He said if expenses stayed the same, they were at $28.1 in expenses
and they would be down $1.1 million next year.
He suggested that in the next twelve months they would have to make
decisions that would yield them $1.1 million in the fiscal year 2011-2012
and that was where the tiered approach, or however they do it, in this
upcoming year. He noted he was not talking about saving $1.1 million this
year; he was talking about making decisions this year that would yield the
City $1.1 million. Mayor Landry
said now there would be a balanced budget this year and next, as long as
they followed through with the changes and the Administration had told them
one way it could be done.
Next 2012-2013, revenue $24.8 million, if they cut this next year $1.1
million, then the expenses would be $27.1 and two years from now they would
be looking at only having to make up $2.1 million.
He noted that instead of the $3.9 million, that number was now down
to $2.1 million. Mayor Landry
said this would mean, in the next two months, Council would have to cut
$400,000, in the next twelve months they had to make decisions that would
yield $1.1 million and he liked the idea of benchmarks. He said the City
Administration had proposed January 1st and there were two tiers with each
being $500,000 and change to come up with the $1.1 million.
He said if they do that they were in effect balancing the budget for
two years. He said this was
looking at a two year budget program and was a way to balance the budget for
the next two years. It would
also give them time to negotiate some concessions and see what the revenue
looked like in the coming year.
Mayor Landry said the action he would propose was to adopt what was
recommended and cut $400,000 immediately by July 1st.
Then talk about benchmarks going forward, $1.1 million by January 1st
or by this time next year and making the changes that would yield $1.1
million coming in the future.
He thought if they did that and gave themselves a benchmark, they
would then have time to go to the unions and staff and give them an option
of which way they wanted to go because this was the number they had to get
to by whatever date. Mayor
Landry said the employees needed to tell them whether they wanted to
contribute more toward health care, lay people off or take a haircut in the
wages. He said this would give
them an opportunity to work with the Administration to come up with these
concessions. He said this would
leave a definitive benchmark and they would be well on their way to
addressing these problems. He said he would be in favor of immediate cuts,
keeping the $1.4 million in with the Fund Balance so they could use it next
year and discussing moving towards making these cuts with a benchmarked
analysis. Member Staudt
felt the proposal was consistent with what he was looking for, but being
proactive, he thought they would have to look at another million dollars
worth of reductions in the 2011-12 budget.
However, he thought by making these immediate types of changes they
were able to look at things like concessions, which have a much longer life
span. He thought that the concessions they were looking for were probably in
addition to what they needed to do during this upcoming fiscal year.
He said he was willing to listen and thought they should take a very
proactive approach throughout the year. In addition to the things they were
talking about, which were basically direct cuts, there were a lot of other
things that could be done to reduce the budget that take a lot longer time.
He hoped that was the spirit they took to 2010-2011 that they were
looking forward to the next budget cycles. Member Staudt said Council had a
unique opportunity to project revenues and it was clear they were not
looking at favorable property values over the next 2 years.
He commented page 217 was the basis of the City’s future and every
cut or reduction made now would have a future effect.
He said every cut or reduction made now would have a positive affect.
He said he saw them having to use a portion of the Fund Balance for
Capital investment into the community.
He stated he was not saying they should do it on the back of
employees but that was where they would derive the most benefit because
employees represented 80% of the budget.
He said that’s where the cuts have to be made and concessions would
be important for the long term fiscal health.
He said he was very supportive of what was being done. He said, in
the past, there was a lot of discussion about line items but this was about trusting that Administration would put the correct things
in the budget. He said
considerable structural changes were made within a week and that generally
just didn’t happen. He said he was
willing to listen but thought timeliness was critical to provide a real cash
return that could be used for future development, investment and it kept the
backbone of the City healthy.
Mayor Pro Tem
Gatt said no other Council in Member Margolis
stated this aligns with what the Administration was proposing and she didn’t
believe in hoarding money because residents deserve to receive services for
their money now not 20 years down the road.
She noted these projections didn’t include revenue from any new
construction that might occur. She said what was important about page 217
was that there was a leveling off and she thought it was important to get
that out there. Member Margolis
said yes, they were projecting huge decreases but were also projecting, at
some point, that there was a leveling off of this and then a slow increase.
She said she had no problem with
setting aside some extra Fund Balance this year.
She said the City would probably end up with close to a 23% Fund
Balance because of the cuts as proposed. Member Margolis said how would the
tier two savings be realized. She
said she had not heard anyone say they were totally against cuts in wages,
layoffs or attritions and she thought it would take all of those things.
She proposed that Administration had performed in the past and would
again to come up with a customized approach that would include all of these.
She thought Administration should have discussions with the staff so that
they were involved and she thought that was the most important thing.
Member Margolis thought people got very frustrated working at a place
where decisions were passed down across the board, with a “we’re the boss”
and “we’re going to say this” attitude.
However, when staff was involved in those discussions and how that
would come about, she thought made a big change. Mayor Landry
proposed that someone offer an amendment to the budget to accept the Tier 1
net savings. So if that motion
were to pass, then this budget would include decreasing expenses $447,410 in
the manner suggested in the April 9 memo. Then he suggested they set
benchmarks and work toward the Tier 2 savings by January 15, 2011 and Tier 3
by April 1st. He said that
would give them the opportunity to, in their negotiations, to have an
executive session as soon as they want to make some propositions on
potential concessions with the unions.
He said they could put deadlines in it and do whatever they want and
work with the concessions. Mayor
Landry said if they work with the concessions then perhaps they wouldn’t
have to lay anyone off in the future. If they don’t, then they would have to
proceed along the lines given in the memo.
He said that would give them flexibility to propose the concessions
in the next six months and it would give the employees the opportunity to
consider the concessions. CM-10-04-061
Moved by Margolis, seconded by Fischer; CARRIED UNANIMOUSLY: To amend the budget to
include the Tier 1 net savings outlined in the April 9th memo, and direct
the Administration to work with Council to attain the Tier 2 and Tier 3
savings by January 15th. DISCUSSION Member Mutch
stated he supported that direction.
However, what he would be looking for soon was an outline from them
on what potential concessions would include and what the fiscal impact of
those would be. He said what he
was looking at was the understanding that if they went to the labor groups
for certain concessions that typically would be applied across the board, he
wanted to see how they fell because it would potentially involve the
Administrative group that was non-union.
He thought they needed be consistent where they were looking for
concessions that would be applied across the board.
He thought they would run into problems with the union groups if
there was a perception that they were taking a hit unfairly.
He said if they had a standard that they were applying to one group
and not to another it would create some inequities that would create
difficulties for Council. Member
Mutch said for that reason, the other thing he was looking at was the number
that Mayor Landry gave Council earlier, even with these ranges of
reductions, just based on projections so they knew it could change, there’s
still that $2 million in the next budget year after that.
Member Mutch said what he would like to see was along with whatever
was accomplished this year, if there were a range of concessions they could
accomplish that would reduce that number even further and two years from now
Council would be looking at a much smaller number as well.
Mayor Pro Tem
Gatt stated he would support the motion and wished it would be amended to be
a bit more aggressive. He said
he would like to see Tiers 2 and 3 accomplished by the January 15, 2011
benchmark. He said the quicker
the monies were saved the less they would have to cut next year and the year
after. He said Council had
received in their packets, information not long ago, a ridiculous proposal
by a group of people that wanted 4% increase in wages, increased pensions,
etc. He said if the unions say
no to Council request for a solution and instead move forward to binding
arbitration and were successful in their endeavors, then these numbers would
have to change as far as people because they had to accomplish a monetary
savings. He said if employee
costs were increased as a result of something Council had no control over,
then they would need to lay off more people than were being proposed; that
message had to go forth too. He
said they didn’t have any control of the unions or over binding arbitration
that might or might not be given.
Mayor Pro Tem Gatt said the public should know that if they approve
the motion, Tier 1 meant that they would be eliminating two police officers.
He asked that the motion be more aggressive to accomplish the Tier 2
and Tier 3 savings by January 15th, so they could begin realizing those
savings. Member Staudt
said all of these savings have a realization for future fiscal years so if
they deferred the Tier 3 savings, it wouldn’t affect this year other than it
provided an additional approximately $125,000 savings to the Fund Balance.
He said that would be the amount three quarters of the year would be
used in these positions. He said
he joined Mayor Pro Tem Gatt in looking at a more aggressive posture only
from the standpoint of he thought they would know very soon where the union
stands. He said if there was no
basis for negotiation, the sooner they could make decisions, the better it
would be for our long term financial health.
Member Staudt said they would have the fiscal analysis of the
previous year available in the fall.
He said April was really getting a long way out there.
He said by April they would be looking at 2011-2012 and he thought if
they could make the reductions by the projected date of January 15th, he
would be in favor of both Tier 2 and 3 being done January 15th.
He said by doing that, they and staff would enter the next budget
season knowing where they stood.
He asked for a friendly amendment to stick with what was proposed by staff
with the January 15th date. He
thought it would make it so much easier on them.
He said he wouldn’t want to vote against it for that purpose. Member Margolis
asked Mr. Pearson if he was comfortable with January 15th and he responded
that for the reasons stated, he thought it would help.
Member Margolis, maker of the motion agreed as did Member Fischer,
the seconder of the motion. Member Crawford
thought they had never been more forward thinking and proactive as they were
now. She thought they would have
to really focus on continuing being proactive with retaining and pursuing
new business wherever it might be found.
She said she was very much in favor of Mayor Landry’s proposal.
She said even though everything was on the table from every small
thing to every big thing, her first choice would never be across the board
cuts. She said she didn’t think
it did what they wanted it to do. She said she was very much in favor of the
motion. Roll call vote on
CM-10-04-061 Yeas:
Gatt, Crawford, Fischer, Margolis, Mutch, Staudt, Landry Nays:
None Member Mutch
noted one of the proposals in the Parks and Recreation budget was
eliminating lifeguards at Mayor Landry
asked if he was correct that the Parks Foundation had committed $45,000,
this year, for the infrastructure of the gardens. Mayor Pro Tem Gatt said
that was his recollection. Mr.
Auler said they were going to consider that at the April 20th meeting and
they would get confirmation at that meeting.
Mayor Pro Tem
Gatt agreed with Member Mutch about the lifeguards being very essential at
the Member Staudt
thought the allocation of naming rights money required them to do this and
it was a part of the formal budget process.
He asked if $45,000 was part of the $300,000 allocation.
Mr. Pearson said no.
Member Staudt thought very specifically in the naming rights agreement that
they had to make it part of the budget and then they would allocate it to
the City as a request of part of that budget.
He thought it should be incorporated and then they should make a
formal request. Mayor Landry
suggested he make a motion that it becomes a part of the budget and then
they inform the Parks Foundation that the proposed budget included it.
Member Staudt said yes. Motion was
approved to add $45,000 from Parks Foundation. Member Staudt
was concerned about the capital improvements and now there is $850,000 more
in fund balance. It was
something to think about rather than parking it along with the $1.4 million.
CM-10-04-062
Moved by Staudt, seconded by Margolis; CARRIED UNANIMOUSLY: To add $45,000 from the
Parks Foundation to the budget for the specific purpose of the Roll call vote on
CM-10-04-062 Yeas:
Crawford, Fischer, Margolis, Mutch, Staudt,
Landry, Gatt
Nays:
None Member Staudt
said, with their actions today, they had broken loose about $800,000 of
additional Fund Balance that Administration didn’t expect.
So, he suggested there might be some
things that were critical needs and were put off and should be brought to
Council’s attention by Administration.
He agreed with Member Margolis that they shouldn’t sock it away for
the future, if it was needed.
Mayor Landry asked where the extra $850,000 was and Member Staudt said it
was from the additional cuts they were making and it would reduce the amount
that they needed to use the Fund Balance that was going to be allocated.
Mayor Landry said in addition to the $1.4 million that he suggested
they park and Member Stuadt said he didn’t know about the $1.4 million and
was told that it was a part of it.
Member Margolis
said budget cuts were hard. She
said she didn’t agree that the lifeguards should be put back at Member Fischer
agreed with Member Mutch and supported keeping lifeguards at CM-10-04-063
Moved by Gatt, seconded by Fischer; MOTION CARRIED: To approve taking $32,300
from the Parks Fund Balance to be used for seasonal lifeguards at DISCUSSION Mr. Pearson
stated it should come from the Parks Fund Balance and it would lower that
fund by that amount. Member Mutch
thought that clarification was important because within the Parks and
Recreation Fund, the focus of that fund had shifted from being an attempt to
support every maintenance and operational activity services to focusing
specifically on the operational needs of that department.
He said that fund was operating very well and it was a very defined
expenditure for this community and one that had value.
He thought it was one they could support financially and would make
sense for the community. Roll call vote on
CM-10-04-063 Yeas:
Fischer, Mutch, Staudt, Landry, Gatt, Crawford Nays:
Margolis Mayor Landry
asked if they needed another Saturday meeting.
He said there had been some requests for additional information from
the City Manager and asked if they would be comfortable that they could
receive that between now and the public hearing on May 3rd with the budget
adoption on May 17th. There was
consensus that it would not be necessary to hold any other budget meetings.
Member Mutch
asked for a revised page 217 in the budget and update just the end of the
fiscal analysis with the numbers that Mayor Landry laid out.
AUDIENCE COMMENT
- None ADJOURNMENT There being no further business to come before Council, the meeting was adjourned at 10:38 A.M. _________________________________ ______________________________ David Landry, Mayor Maryanne Cornelius, City Clerk _________________________________ Date approved: April 19, 2010 Transcribed by Charlene McLean
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