06/27/1983 CONF - 5240�
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CITY OF FRIDLEY
CONFERENCE MEETING
JUNE 27, 1983
1� PRELIMINARY DISCUSSION
POLICE DEPARTMENT
$M
- I�^BUDGET
PARK AND RECREATION DEPARTMENT
FIRE DEPARTMENT
PUBLIC WORKS DEPARTMENT
CENTRAL SERVICES
CITY MANAGEMENT
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L1ATE: JUta? 22, 1983
I have reviewed the information received from both the League and the
Legislature regarding the changes in the various tax laws applicable to the
City of �idley for 1984. I shou].d point out that at the current time there
is same oonfusion within the State Finance and Taxation Departments over
exactly haw the formula should be applied. Normally, at this time of year,
the League has provided us with a summary document called "Aids for Budget
Preparation". �is docwnent normally includes all mi11 levy calculations and
local goverrunent aid formulas. �ey are withholding publication at this time
tmtil the various State departments determine ac�trninistratively exactly how
they intend to apply the laws. �erefore, it will still be a nwmber of weeks
before the exact accurate figures are available to us.
�ere is some general inforn�ation I have available that we can use for initial
preparation of our budgets.
Regarding Federal Revenue Sharing, it appears that we will be certified
basically the same amamt of mor�ey that we received for the last entitlement.
73iat amamt being 5180,900. As you recall, for the last two years we have
been taking additional amoi.uits of money fran surplus and interest in order to
insure that the level of fLmding for revenue sharing was equalized. In 1984,
this surplus will be almost exhausted and therefore, we are estimating an
amamt of 5187,000 available to the General F�d fram Revenue Sharing. This
will be a reduction of $95,000 aver the 1983 Budget.
Zhe local goverrunent aid formula has still not been finalized by the State. I
have reoeived some estimates from two sources on Friclley's portion. The
League of Minnesota Ci.ties estimates that our local government aid for 1984
will be 51,697,840. The small cities group has estimated that our local
goverr�ment aid will be 51,703,372. Part oF the law in local government aid
requires that they oertify the exact amount of local gavernment aid to us by
August 15 of each year. Therefore, it will be some time until our actual
figures are finalized. One acic3itional factor in local government aid is the
a�namt we reoeive fram the State from law and moderate income housing. It
appears that a portion of that local goverrmiPnt aid will include the amount of
mor�ey that we receive on Village Green. Previously, �is amount was receivec7
from the State in a separate dzeck and naw it will be folded in as part of the
local goverrnnent aid package.
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General Revenue Projections - 2- Jis►e 23, 1983
Ztie area praperty tax and levy limitations is where most of the o�nfusion and
conflict is arising. SpecificaTly, within the levy limits, there is some
aonfusion over the percentage of the increase, the effect of those of the
cities that did not levy to the maximun in prior years and a portion which is
referred to as special base adjustments authorized by the �issioner. It is
my tnderstanding that the League publication will s��arize these in detail
and I will present those to you at that time.
Under the area praperty tax, there has been a change in the percent used for
determining assessed value. On hanesteads, the first 530,000 of market value
will be appraised at 17 peroent rather than the first 527,000 at 16 percent.
�e next 530,000 of market value will be appraised at 19$ rather than the next
527,000 being appraised at 22$ and the excess over 560,000 will be appraised
at 30$ rather than the excess over 552,000 being appraisec] at 28$.
Ac3ditionally, there has been a change in the ��ercial property ratio. The
first 550,000 of market value will be appraised at 34$ rather than the current
40$. Zhe effect of this change will be to shift more of the property tax
burden from oonanercial industrial to residential.
Zhere has been an additional change in the Hamestead Credit formula. The
maximun credit amount remains at 5650 but there has been a change in the
peroentage. �he present 58$ has been reduoed to 54$ and only applies to the
first 565,000 of market value. �e effect here is that the more a City taxes
their peaple, the more they will reoeive the benefit of the Aanestead credit.
As you may have heard on the news and read in the ne�wspapers, the basic trend
naw for all forms of taxation and goverrnnent aid is based on "need". Revenue
Sharing, for example, is based on the amount in which we tax our property
owners. �e higher we tax, the more Revenue Sharing we get. Within the
property tax calculations, this is also a factor when determining Hamestead
credit. Also, in le�vy limits and goverrunent aid, there has been added to the
formula portions which include �e amount that we've previously taxed; the
more we tax, the more money we reoeive.
I am in oontact with the Leagu� and the State and as more information becomes
available, I will provide it to you. If you have ar�y questions, please feel
free to let me lazaw.
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Attached are the objeetives for the various divisions xithin the department
of Central Services for the 1984 budgetary year. You will note Whe n
revieWing these objectives, that most of them revolve around the current
computer evaluation proceeding Within the City. The department of Central
Services has been heavily involved in the end of 1982, and all of 1983,
budgetary years in evaluating the direetions the City should go in its
computing capacitq.
As you recall, the reeently oompleted MIS Study determined that the City
should be pursuing a different direetion in terms of its computer usa ge.
The basie conclusions of the t�IIS Study determined that the large amount of
money that is currently being spent Por the LOGIS operation could better
serve the City if used to pravide data processing resourees for a�ride
variety of departments and users. It was determined that the acquisition
of an in-house finaneial/aecounting system could be aecomplished at a cost
far less than the yearly amount paid to LOGIS, thus releasing resourees to
other projects.
It Was �ith this in mind that the City Finance Division be gan evaluating
various computer produets that could be operational on the in-house TI 990
computer system. At the current time, the staff has selected a single
product and is well into the process of evaluating it. Their preliminary
findings have determined that the product is state-oP-the-art type of
programming and Par exeeeds the current available software on the LOGIS
system. It provides for full inte�ation of all financial systems to the
master general ledger. Additioually, the current Pinancial system under
evaluation provides for additional sub-systems such as receipt control,
purchasing, and Pull budgetary acoounting. It also provides the mechanism
for interfacing with the receipting cash register Whieh Would provide for
automatic update oP information. Yhat is even more interesting, is that
the estimated purehase price, With enhancements, would be between �25,000
and �30,000. xhich is far 2ess than the amount paid on a qearly basis for
the LOGIS sqstem. ,
In summary, the current evaluation has determined that we ean obtain a far
superior Pinancial/accounting system for Par less money.
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� I have included with this information three additional doeuments. The
Pirst document, entitled "Proposed TI 99� Cqnversion", indicates the total
dollar amounts that Would be needed on the front end to perform hardWare
and software coaversion. The second page, entitled *Comparative
Ezpenditures", lays out the amount of money the Citq is Qurrently spe nding
for data processing projected into the aeut five years. It also eatimates
the Proposed Expenditures Por the next five years. The proposal amoritizes
the cost oP the eapital purchase plus the by-out payment to LOGIS over a
three year period. It additionally includes a�10,000 capital expansion
alloeation for the next five years to be used for additional aoftware and
hardWare as its need becomes appareat. You ean see that the proposed
expenditures over a Pive year amoritized period are more than �62,000 less
than we would spend for our �urrent systems. Additionally, if the �50,000
alloeated for capital eupansion Was not spent, the City would save over
�112,000 in the next five years. The last page, entitled "Comparative
Systems", indicates the systems that the City is currently operati ng for
the $610,000 figure, and the systems that the City Would be able to operate
With the proposed expansion.
There are tWO key elements in the entire process. The Pirst key element is
the determination of an aeceptable financial/accounting system. As stated
before. xe are close to eompleting our evaluation and are very close to
making a recommendation. The second element is the needed up-front eapital
for expansion. What we Will be proposing is that the City loan itaelf the
money needed for eapital expansion. This process has been used
historically for the purehase of fire trueks, large copying equipment, and
other major capital purposes. We are proposing the establishment of an
internal MIS Fund. All bills for salaries, soPtware, hardWare, and
maiatenance xould be paid out of the MZS Fund. Each department would
transfer monthly the amount of money needed to cover their particular
department expenditure. In this fashion, we can clearly keep traek of the
amount spent for MIS and determine exaetly which department is spending how
mueh. This, oP eourse, Will require Council action in order to transfer
the initial funds and to set up the MIS Fund. At the current time, We are
estimating a total transfer needed for hardWare and software acquisition of
�92,300. We additionally Will need an amount of $31,560 to buy out our
LOGIS eommittment for a total of �123,899• This amount has been amoritized
in the comparative expenditures form over a period of three years for aost
comparison purposes. Again, even with this initial capital outlay, the
City could save an eaeess of �112,000 over the five year period.
At the current time, the City oP Fridley eontrols their eomputer operati ng
system With three part-time personnel. This has proved to be very
successful. Over the tWO year period of our ir�house operation, We have not
seen the requirement for full-time programmers/operators, or design
personnel. I Would continue to project into the future that these types oP
personnel Would aot be required Within the City of Fridley. I Would,
though, recommend that in 198u, we begin to evaluate the necessity of
converting an existing vacant position Within the Central Serviees Division
to an Information Specialist. This person would act as a projeet
c:oordinator Por all the systems currently operating on the in-house system.
My objective here is speeiPically to maintain some eontinuity in the
position, and additionally to provide bargaining poWer Por the City oP
Fridley When hiring personnel. At the current time, many cities and
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ag�encies are expanding into the TI 990 hardWare line and, therefore, the
recruiting of enperienced TI personnel is becoming very aggressive. By
maintaiaing a full-time position, With benePits, We Would in fact, be able
to have a better aegotiating position When attempting to hire and retain
personnel. You Will note by the "Comparative Expenditure" study that I
would recommend goiag from three part-time people to one full-time and one
part-time person �ith no change in the actual dollars expended.
The entire objective oP the MIS Study Was to deerease or equalize cost,
enhance productivity, increase accuracq, expand non-finaneial systems and
provide managers, Council and citizens With elear, accurate and timely
information. We have already seen aceomplishment of these objectives With
the use of �ord processing and in the areas oP liquor inventory and fire
and police management. I adamantly believe that with the f ull
implementation of our proposal, We Will meet these objeetives.
As stated before, the entire proposal in detail Will be presented to the
Couneil in July Por their action at that time. I Will be prepared at the
Monday night Conferenee Meeting to diseuss all of these items.
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D6PARTl�? OF CBHTRIL 38ItYICSS
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Citv Clerk/Treasurer Division
1. Implementation oP a computerized Licensing System.
2. Design and development of a computerized Records Retention System.
3. Interfacing Receipting Cash Register with General Ledger and Utility
Billing System.
4. Implementation oP eomputerized Political Sub-Division System.
5. Implementation of Micrographics Records Retention and Storage System.
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1. Implementation oP neW systems:
General Ledger
Payroll
Purehasing
Utility Billing
Fixed Assets
Equipment Control
Special Assessments
Receipts Control
Budgeting
2. Evaluation of Optieal Mark Read Punetion on IIniform Product Code for
liquor inventories.
3. Continued development of Mierographies Records Retention System.
Cinie Center Division �
1. Development oP a coordinated maintenance plan for the Civic Center plaza.
2. Repainting and rePurbishing of the interior of the Civic Center.
3. Continue the plans for the repair of the Civie Center roof.
4. Finalization of the sprinkler system.
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� 5. Review overall security system for the Civie Center.
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1. Complete final stage of property data eonversion to Anoka County eomputer
appraisal sqstem.
2. Complete final stages oP initial input of property data-base elements
into an in-house oomputer system.
3. Initial developmeat of integration of County aad i.n-house eomputer
resources.
4. Aceomplish physical revieW oP 25x of taaable properties.
3ZSYSNS QOMPAaISOBS
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General Ledger (integrated to Payroll only)
Payroll
Fixed Assets
Utilitq Billing
Equipment Control
Liquor Inventory �
Fire Management
Police Management (Enfors)
Word Processing
Street Indexing
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General Ledger (inte�ated to all related systems and aash registers)
Payroll
Purehasing
Budget
Reeeipt Control
Utility Billing
Fixed Assets
Equipment Control
Liquor Inventory (with Optieal Mark Read application)
Fire Management
Police Management (Enfors).
Recreation Scheduler
Records Retention
Word Processing
Municipal UniPied Data Base:
1. Special Assessment Sub-system
2. License/Permits/Activity Sub-system
3. Street Indexing Sub-sqstem
�. Parks Indexing Sub-system
5. Tax Assessments Sub-system
6. Political Sub-Division Sub�sqstem
7. Planning Sub-syst�
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TI 990112/w/Caehe
� 64g 208VAC �20,000
96I�ID Disk Drive 18,500
600 LPM Printer 11,950
(7) TI 911 CRT's W/
Dual Controllers 10,000
(2) TI 810 printers
WlCompressed Print 5,400
70 " Equipment Cabiaet 1,$80
Finaneial Accounting 10,000
Utility Billing 10,000
Payroll 5,000
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198� 1985 19�6 1987 1988 i�Or11L
c�'r B�sxsa.s:
LOGIS �51,243 �53,805 #56,495 �59,320 #62,286 �283,1�9
TI 990 Maintenance 24,401 26,671 28,005 29,405 30,876 139,358
Salaries
(3 part-time) 34,000 35,700 37,485 39,359 41,327 187,871
CURR�i? ?OTAI.3 �109,6�� �116,176 #121,985 �128,084 #13�,#89 #610,378
pa�poses B�sgs:
TI 990 Maintenance
(eurrent) 24,401 26,671 28,005 29,405 3�,876 139,358
TI 990 Maintenanee
(expanded) 8,304 8,719 9,155 9,613 10,093 45,884
Capital Paybaek 31,1�3 3�,143 37,1�3 -0- -0- 93,�29
LOGIS 10,523 10,523 10,523 31,569
Salaries
(1 i'u11, 1 part ) 3�►, 000 35,700 37, 485 39, 359 41, 327 187,871
Capital Expansion_ 10� 000 10,000 10,000 10,000 10,000 50,000
P�OP03BD TOTALS �118,371 #122,756 �126,311 �88,377 �92,296 �548,111
s�Y�GS (i8,727) (#6,580) (3�r326) #39,7�7 �2,193 3 62,267