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CHA 09/05-2017 TO: Charter Commission Members FROM: Deb Skogen, City Clerk and Staff Liaison Date: September 1, 2017 Re: Charter Commission Meeting of September 5, 2017 TUESDAY This is a reminder to you that the next Charter Commission meeting will be held on , th September 5 at 7:00 p.m. in Conference Room A on the Upper Level. In order to ensure a quorum, please remember, the Charter Commission policy requires a th member to call or e-mail before 10:00 a.m. TUESDAY, SEPTEMBER 5, as to whether or not you plan on attending the meeting. Please contact me by phone at (763)572-3523 or e-mail at deb.skogen@fridleymn.gov, or Jake by phone at (763)572-3508 or e-mail at jake.foster@fridleymn.gov as to your attendance. If we do not have a quorum by 10:00 am ON TUESDAY, we will send out an e-mail to see if additional members will attend. If by Noon there will not be a quorum, we will send out an e- mail to all members and post a notice on the door announcing the cancellation of the meeting for those Commissioners who did not contact me, but came to the meeting. The Commission will continue its discussion of Chapter 7 pertaining to recommended changes from the Finance Director. These are ideas for you to think about prior to the meeting regarding how financing is completed in the future in light of state and federal changes. In addition Richard Walch and Richard Johnston terms expire in September. We will discuss those terms at the meeting. If you have any other questions or concerns, please feel free to contact me or Jake. CITY OF FRIDLEY CHARTER COMMISSION AGENDA TUESDAY, SEPTEMBER 5, 2017 7:00 P.M. LOCATION: FRIDLEY MUNICIPAL CENTER CONFERENCE ROOM A UPPER LEVEL 1.CALL TO ORDER: 2.ROLL CALL: 3. APPROVAL OF AGENDA: Motion approving the September 6, 2017 meeting agenda 4. APPROVAL OF MINUTES Motion approving the May 1, 2017 meeting minutes 5. ADMINISTRATIVE MATTERS A. Charter Commission Membership Walch/Johnston Terms B. Status of Ordinance Amending Chapter 7 6. OLD BUSINESS A. Continued Discussion on Chapter 7 7. NEW BUSINESS A. 8. FUTURE MEETING TOPICS/COMMUNICATIONS A. 9. ADJOURNMENT Motion to adjourn the meeting Next Regular Commission Meeting Date: OCTOBER 2, 2017 CITY OF FRIDLEY CHARTER COMMISSION MEETING MAY 1, 2017 CALL TO ORDER: Chairperson Ostwald called the Charter Commission meeting to order at 7:00 p.m. ROLL CALL: Members Present: Commissioners Gary Braam, Don Findell, Manuel Granroos, Richard Johnston, Ted Kranz, Bruce Nelson, Rick Nelson, David Ostwald, Barb Reiland, Pam Reynolds, Valerie Rolstad, Cindy Soule, Avonna Starck, and Richard Walch Members Absent: Commissioner Zach Crandall Others Present: Deb Skogen, City Clerk/Staff Liaison Wally Wysopal, City Manager Shelly Peterson, Finance Director Jake Foster, Management Analyst Scott Lund, Mayor Julie Xxxx, Fridley citizen APPROVAL OF AGENDA Commissioner Reiland MOVED and Commissioner Johnston seconded a motion approving the meeting agenda. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON OSTWALD DECLARED THE MOTION CARRIED. APPROVAL OF MINUTES Commissioner Reynolds said the fourth paragraph on page four should be changed to provide clarification that Commissioner Rolstad was speaking in that paragraph. Ms. Skogen said the whole paragraph was Commissioner Rolstad speaking and there was no need for clarification. . Ms. Skogen said she wrote the minutes in past tense and it should remain to be consistent. Commissioner Reynolds said on page ten her preference was not to remove the CPI but keep the 5%. She preferred to keep the restriction as, but would be more comfortable with removing the CPI and keeping the cap than removing the restriction altogether. Ms. Skogen said she would review that section on the recording. DRAFT CHARTER COMMISSION MEETING OF MAY 15, 2017 PAGE 2 Commissioner Reiland said on page three, Ms. Skogen said there was another section where the words should be added where Fridley is said to be the only fiscal disparities contributor. With no other changes to the minutes, Commissioner Reiland MOVED and Commissioner Kranz seconded a motion approving the Charter Commission meeting minutes of May 3, 2017 as corrected. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON OSTWALD DECLARED THE MOTION CARRIED. ADMINISTRATIVE MATTERS Chairperson Ostwald open-meeting law. He said he was concerned about some of the email communications being sent between commissioners. Further discussion took place detailing how the commissioners should avoid violating the open-meeting law in the future. OLD BUSINESS Discussion of Chapter 7 Chairperson Ostwald introduced the ordinance staff was requested to provide to be recommended to Council for the Commissioners review. in Commissioner Reynolds referred to the minutes from the previous meeting referencing a statement from Commissioner Nelson requesting a rough draft of the edits for Chapter 7. Ms. Skogen said the consensus of the Commissioners was to prepare an ordinance to recommend an amendment for council action. Ms. Skogen described the edits based on their request. Commissioner Reiland said she would like to discuss the proposed language change regarding the levy restriction to ensure it was clear. Ms. Skogen said they may want to clarify the language further in Section 7.02.1 to ensure the language was written clearly. Commissioner Nelson said his motion was to use the previous DRAFT CHARTER COMMISSION MEETING OF MAY 15, 2017 PAGE 3 The Commissioners discussed the clarity of the language. Ms. Skogen suggested adding Commissioner Soule suggested splitting the sentence into two sentences for further clarity. Commissioner Findell suggested change. Commissioner Findell still thought they should be removed, and suggested that a period could be put in their place to break up the sentences. Further discussion took place regarding whether or not the sentences should be split, and where a period would make sense. Shelly Peterson, Finance Director, suggested the commissioners remove the words She also thought could also be removed. She suggested Commissioner Reynolds ask Ms. Skogen said it was added when the levy restriction was changed from the mill rate. Ms. Peterson said the sentence. Ms. Skogen re-read the amendment: The City shall have, in addition to the powers by this Charter expressly or impliedly granted, all the powers to raise money by taxation pursuant to the laws of the State which are applicable to cities of the class of which it may be a member. The amount of taxes levied against real and personal property within the City for general City purposes shall not exceed 5% more than the prior year tax levy. However, if necessary, it may be increased up to an additional 3% with the vote of four members of the Council. Chairperson Ostwald asked if anyone had any other changes. Commissioner Findell asked if the Commissioner Rolstad MOVED and Commissioner Soule seconded a motion to accept the updated language. UPON A VOICE VOTE, 13 COMMISSIONERS VOTED AYE AND 1 COMMISSIONER VOTED NAY (COMMISSIONER REYNOLDS). CHAIRPERSON OSTWALD DECLARED THE MOTION CARRIED. DRAFT CHARTER COMMISSION MEETING OF MAY 15, 2017 PAGE 4 Ms. Skogen outlined the other changes recommended in Chapter 7 where state law conflicted with the charter. Commissioner Soule asked if the State Statute numbers or chapters would be subject to change. ecific chapter numbers to make sure future business does not get hung up due to changing of chapters. Commissioner Nelson added the statute could be referenced in parentheses. Ms. Skogen continued reviewing the proposed changes. Commissioners then began to go through each section of the ordinance to discuss any potential changes. Commissioner Reynolds asked for clarification regarding the language on recycling in Section 7.02, and why recycling was removed from Section 3.A to Section 3.B. She said everything in Section B were items or services that were assessed by usage fee, and items in A were mandated. She asked if she could then opt-out of the recycling programs, or choose not to use it if it was moved to Section 3.B. Ms. Skogen said recycling was mandated and therefore the City has to provide it to all residents. Commissioner Reynolds said recycling should be moved back into Section 3.A rather than 3.B. Commissioner Starck asked felt the fee for recycling was a very nominal fee so it should present less of an issue. Commissioner Nelson asked if every fee collected from recycling was used for recycling services. Staff stated it was only used for recycling. rated a small amount of revenue. As it has progressed, the program . Now the contract is up for renewal and as recycling valuations have gone down. He further confirmed the rates charged for recycling only covered the cost of the recycling services. Commissioner Reynolds stated the rates were soon to cover expanded recycling services, as she said there was an RFP that has been created to do so. Mayor Lund said he was not aware of any RFP or plans for expansion of the recycling service. Ms. Skogen said the organics portion of the pay for it. Commissioner Reynolds MOVED saying that the original restriction of an increase in CPI or a 5% growth could be added to section 3 to control those costs. With no second, the motion failed. Commissioner Nelson MOVED and Commissioner Reiland seconded a motion to move the recycling fees back into Section 3.A from Section 3.B DRAFT CHARTER COMMISSION MEETING OF MAY 15, 2017 PAGE 5 UPON A VOICE VOTE ALL VOTING AYE CHAIRPERSON OSTWALD DECARED THE MOTION CARRIED. . Ms. Skogen said she left it out to remain consistent throughout the charter. Commissioners agreed it should not be changed to keep the charter consistent throughout. Moving to Chapter 7.04, Commissioner Nelson asked if they wanted to ensure the Council could arrange additional budgetary meetings by putting p felt this would give Council the opportunity to have more meetings if needed, but would still be allowed to have one estimated budget meeting. Commissioner Nelson MOVED and Commissioner Soule seconded a motion to add parentheses Section 7.04. UPON A VOICE VOTE ALL VOTING AYE CHAIRPERSON OSTWALD DECARED THE MOTION CARRIED. There were no comments or questions with Sections 7.05, 7.06, and 7.07 Mayor Lund HMof the section and to add the word was understood that raising the tax levy an additional 3% required an affirmative vote of 4 Council members. important that it calls out a number (4) rather than a percentage or majority vote in case a member is absent or abstains from the vote. Commissioner Walch agreed. Ms. Peterson said there was also an area in 7.15 that referred to a 4/5 vote of Council, and this language could also be changed to remain consistent. Commissioner Findell said they addressed this in the last meeting, and wanted to be sure that at least 4 members were voting. After further discussion, Commissioner Walch MOVED and Commissioner Starck seconded a motion to make the additional change to Section 7.02.1. UPON A VOICE VOTE ALL VOTING AYE CHAIRPERSON OSTWALD DECLARED THE MOTION CARRIED. Commissioner Nelson MOVED and Commissioner Reiland seconded a motion recommending an amendment Fridley City Charter Chapter 7 by ordinance to the City Council. UPON A VOICE VOTE, 13 COMMISSIONERS VOTED AYE AND 1 COMMISSIONER VOTED NAY (COMMISSIONER REYNOLDS). CHAIRPERSON OSTWALD DECLARED THE MOTION CARRIED. DRAFT CHARTER COMMISSION MEETING OF MAY 15, 2017 PAGE 6 Ms. Skogen said she would provide the ordinance to the City Council to schedule the public hearing. Looking at the Council schedule, she said it would most likely be held the last meeting in June. Ms. Skogen introduced a memo written by Ms. Peterson outlining additional areas where Chapter 7 conflicted with State Statute, Generally Accepted Accounting Principles (GAAP), or the State Commissioners were presented with a redlined version of Chapter 7 provided by Ms. Peterson as suggested ideas to make the charter more compatible. Commissioner Starck asked how urgent the proposed changes were. Ms. Peterson said there are sections of the chapter she cannot currently comply with, and that the City has not been complying with, so she did not think it was urgent. Commissioner Kranz suggested Commissioners review the redlined version quickly while Ms. Peterson was in attendance. Ms. Peterson reviewed the proposed changes. Commissioner Kranz suggested it be placed on the September meeting agenda. Commissioner Nelson said he did not feel comfortable making these wholesale changes during the current meeting, especially given that they spent 8 months on the first section to which Chairperson Ostwald and other commissioners agreed. Ms. Skogen suggested the Commissioners review the material during the summer. Staff could provide any additional materials upon request. The Commissioners were in agreement. Commissioner Soule commended Ms. Peterson for her hard work and thoughtfulness in providing this information, and throughout their discussion. ADJOURNMENT: Commissioner Granroos MOVED and Commissioner Starck seconded a motion to adjourn the meeting. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON OSTWALD DECLARED THE MOTION CARRIED AND THE MEETING WAS ADJOURNED AT 8:16 P.M. Respectfully submitted, Debra A. Skogen, MMC City Clerk/Staff Liaison Commissioner Manuel Granroos Secretary DRAFT AGENDA ITEM CHARTER COMMISSION MEETING OF MAY 15, 2017 To: Wally Wysopal, City Manager Deb Skogen, City Clerk From: Shelly Peterson, Finance Director Date: May 8, 2017 Re: Recommendations for Chapter 7 of Charter As requested, staff has could be revised or omitted. We have consulted the State Auditors guidelines, League of Minnesota Cities recommendations, compared to other accounting standards (GASB and GAAP specifically) and referenced neighboring communities charters. The recommendations suggested will help staff to efficiently and effectively operate without having to compare the Charter to other rules and guidelines and help prevent conflicts in interpretation. Our goal was to make suggestions that allow this chapter to be a timeless guide. Section 7.04 This section discusses the preparation of the budget in general terms. The accounting requirements are unique to the fund type. Staff recommend this section be modified to specify the fund types requiring a budget in the format defined. In addition, some funds do not prescribe to the format outlined so adding text that will allow the City Manager to present other fund types in an understandable format is suggested. In addition, #2 under 7.04 outlines a specific publishing format, frequency and deadlines. Today, notification to taxpayers is done through the Truth in Taxation legislation which requires each parcel receive notification of their proposed taxes and hearing dates. The City follows Statute 275 and the Department of Revenue establishes the dates and notification requirements each year. Staff recommends this section be omitted, suggested text could be: Notification of proposed property taxes and annual budget will be prepared in accordance with Minnesota Statutes Chapter 275. 7.07 Staff recommends an additional paragraph addressing transfers between funds: At the request of the City Manager, the Council may transfer unencumbered appropriations from one organizational unit to another. All appropriations shall lapse at the end of the budget period to the extent that they shall have not been expended or lawfully encumbered. 7.12 Staff suggests this section be significantly consolidated and not list specific reference to fund names or specific detail to how those funds function. In reviewing other charters and accounting standards staff recommends this section be modified to always remain in compliance with current accountings laws and standards. The edits suggested would condense this section to one paragraph. There shall be maintained by the City Manager a classification of funds which shall provide for a general fund and funds required by law, ordinance or the resolution and meet generally accepted accounting standard and procedures. The Council may, by resolution, make inter-fund loans where permitted by law except from funds held by the City as a trustee or custodian or in the capacity of an agent. 7.14 Staff recommends this section be modified to allow conformance to dates and formats as required by State law. The accounts of the city shall be maintained in accordance with generally accepted governmental accounting standards and procedures. The City Manager shall submit such reports as will be necessary in order to keep the Council fully informed of the financial conditions of the City. Once a year in accordance with Minnesota Statutes Chapter 471, the City Manager shall submit a complete financial report of the City, for the preceding fiscal year. This report shall contain audited financial statements and disclosures which present newspaper in a format consistent with State Auditor requirements. 7.15, 7.16 & 7.18 After reviewing several other charters and consulting our bond attorney, staff recommends changes to the debt section to reduce the potential for error when comparing to State law. The State has significant and detailed indebtedness laws. Each bond type has its own rules for borrowing, payments and how funds are held. Some bonds have their own limits outside the State imposed legal debt limit. In addition, State law is more restrictive than the limit established in the Charter. If approved by the Commission this section could be reduced to one or two paragraphs. 1.Except as provided in Sections 7.17 and 7.18, no obligation shall be issued to pay current expenses, but the Council may issue and sell obligations for any other municipal purpose in accordance with state law and within the limitations prescribed by law (Minnesota Statutes Chapter 429). 2. The Council by a vote of at least four (4) of its members may authorize the issuance of the bonds to provide funds for any public purpose not prohibited by law, or may in its discretion, by a majority vote of all of its members submit to the electorate propositions for the issuance of such bonds. When such a proposition is submitted to the electorate, no bonds or other term obligations of the City may be issued except pursuant to a favorable vote of a majority of those voting on the proposition of their issuance. 7.17 During the course of this project staff identified a section commonly found in other Charters for Emergency Debt Certificates to address unforeseen events. The commission may want to consider splitting out 7.17 to allow for Tax Anticipation Certificates separate from Emergency Debt Certificates. A tax anticipation certificate is an advance on taxes already levied. An emergency certificate is the ability to borrow and levy in the future due to an extraordinary event. Section 7.17. TAX ANTICIPATION CERTIFICATES. In a manner consistent with Minnesota Statues chapter 412, at any time after January 1, following the making of an annual tax levy, the council may issue certificates of indebtedness in anticipation of the collection of taxes levied for any fund and not yet collected. The total amount of the certificates issued against any fund for any year with interest thereon until maturity shall not exceed ninety percent (90%) of the total current taxes for the fund uncollected at the time of the issuance. Such certificates shall be issued on such terms and conditions as the Council may determine but they shall become due and payable not later st than the 1 day of April of the year following their issuance. The proceeds of the tax levied for the fund against which tax anticipation certificates are issued and the full faith and credit of the City shall be irrevocably pledged for the redemption of the certificates in the order of their issuance against the fund. Section 7.1_. EMERGENCY DEBT CERTIFICATES. If in any year, the receipts from taxes or other sources should from some unforeseen cause become insufficient for the ordinary expenses of the City, as provided for in the budget, or if any calamity or other public emergency should subject the City to the necessity of making extraordinary expenditures, then the Council may by resolution, issue and sell certificates. A tax sufficient to pay principal and interest on such certificates with the margin required by law shall be levied as required by law. The authorization of an issue of such emergency debt certificates shall take the form of a resolution approved by at least four (4) of the members of the Council. It may be passed as an emergency resolution and would be exempt from voter approval. The recommendations listed above are designed to allow the Charter to always remain current when compared to law by eliminating specific accounting details, such as fund names and debt mechanisms along with date and publication format requirements.