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CHA 05/18/2009
TO: Charter Commission Members _ FROM: Deb Skogen, City Clerk and Staff Liaison Date: May 12, 2009 CITY OF Re: Charter Meeting of May 18, 2009 FRIDLEY The next Charter Commission meeting will be held on Monday, May 18, 2009 at 7:00 p.m. in Meeting Room 1 in the lower level of City Hall. In order to ensure a quorum,please contact me by 10 a.m. May 18th at (763) 572-3523 or skogend@ci.fridley.mn.us whether or not you will be attending the meeting. Please find the agenda for the May 18th meeting. CITY OF FRIDLEY CHARTER COMMISSION AGENDA MONDAY, May 18, 2009 AT 7:00 P.M. LOCATION: Fridley Municipal Center Meeting Room 1, Lower Level 1. CALL TO ORDER: 2. ROLL CALL: 3. APPROVAL OF AGENDA: 4. APPROVAL OF MINUTES March 23,2009 April 27,2009 5. Administrative Matters A. Commission Vacancy 6. Discussion of Proposed Amendment to Chapter 7 7. Discussion of Future Items 8. ADJOURNMENT Next Regular Meeting: Monday, September 28, 2009 at 7:00 p.m. in Meeting Room 1 in the Lower Level Documents Provided with Agenda 1. March 23, 2009 Minutes 2. April 27, 2009 Minutes 3. Chapter 7—Pre 2000 petition language 4. 2000 Petition(pink) 5. Petition Task Force Amendment 2001 (pink) 6. Chapter 7—current chapter 7. Original Holm Amendment(green) 8. Holm Amendment with 4/27 amendments (blue) 9. Holm Amendment without strikeouts or underlines (yellow) 10. Chapter 7 Mounds View Charter CITY OF FRIDLEY CHARTER COMMISSION MEETING March 23, 2009 CALL TO ORDER: Chairperson Borman called the Charter Commission meeting to order at 7:00 p.m. ROLL CALL: Members Present: Borman, Braam, Findell, Hoiby,Holm, Jorgenson, Kranz,Nelson, Reynolds, Ryan, Scholzen, Shaw and Soule Members Absent: Kirkwood and Plummer Others Present: Deb Skogen, City Clerk/Staff Liaison 1. APPROVAL OF AGENDA Commissioner Braam MOVED and Commissioner Reynolds seconded a motion approving the n agenda. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON BORMAN DECLARED THE MOTION CARRIED. 2. APPROVAL OF MINUTES Commissioner Braam MOVED and Commissioner Holm seconded a motion to approve the February 23, 2009 Charter Commission minutes. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON BORMAN DECLARED THE MOTION CARRIED. Commissioner Reynolds ask to make a correction to the March 3, 2009 meeting minutes on page 2 of the minutes, the paragraph should read: "Commissioner Reynolds said the proposed ordinance takes all of the amendment language out. Ms. Skogen said it was a draft to return it to the original language prior to the 2000 amendment. She said the proposed ordinance was drafted by staff for discussion by the Charter Commission." Commissioner Reynolds MOVED and Commissioner Hoiby seconded a motion to approve the i1 March 3, 2009, Special Charter Commission minutes as amended. CHARTER COMMISSION MEETING OF MARCH 23,2009 PAGE 2 UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON BORMAN DECLARED THE MOTION CARRIED. 3. ADMINISTRATIVE MATTERS Chairperson Borman reviewed the report of the Nominating Committee recommending the nomination of Cindy Soule, Chairperson; Rick Nelson, Vice-Chairperson; and Carol Hoiby, Secretary. He opened the floor for nominations for each office. Hearing none, he closed the nominations. " Commissioner Holm MOVED and Commissioner Findell seconded a motion approving the nominations as recommended by the Nominating Committee by acclamation. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON BORMAN DECLARED THE MOTION CARRIED. 4. DISCUSSION OF CHAPTER 7 Deb Skogen reviewed the information and timeline for charter amendments noting if there was an election all precincts would be open. She also reviewed the two amendments that were included in the packet. The first amendment was drafted by staff for discussion during the Special meeting on March 3, 2009 and the second was drafted by staff based on the discussion of the special meeting. There was also a discussion of which school districts had elections and if all precincts were open, did the city charge any portion of the election to the school districts. Deb Skogen said they are billed based on the number of registered voters that live in that school district in that precinct. Commissioner Jorgenson asked if HF979 had a companion bill in the senate that Commissioner Reynolds discussed at the March 3`d meeting which pertained to the missing levy money and that the city could levy 100%of their lost LGA and asked if there was a senate bill. Commissioner Reynolds said there was a house and senate bill. The senate was to have a hearing the next day and the bill was sent to the House Local Government Committee. Commissioner Jorgenson wondered if levy limits were imposed whether or not the city could go to the voters to request a levy increase. Commissioner Holm said if the Charter was changed and no action was taken by state law, there would be no impact on the City,the City could not levy. Commissioner Soule said the first information they received about the budget was during the March 3`d meeting. She said it sounded like the city was going to have a bigger deficit. She said the city had made additional cuts to the budget in light of state cuts but in order to balance the budget they have had to go into the reserves. Was it really important to move on this issue tonight or was it something that could be discussed for a few months and table for the summer to see the outcome of legislation? Was it important for an election this year or in 2010? CHARTER COMMISSION MEETING OF MARCH 23,2009 PAGE 3 Commissioner Jorgenson felt the Commission should take more time to consider the request to bring it before the voters in 2010. She felt people were highly suspicious of the federal bailouts, the debt and encumbrance at the state level and felt it would cause further distress if changed. Commissioner Kranz felt overreaction would be the worst thing to do under the current circumstances without having the knowledge of what was going to happen. Commissioner Reynolds said the current language allowed the City Council to go to the voters to request additional money for services. She felt if the council said the City needs more money because of the loss in LGA, or they need this much money for the police department or fire department,that the voters would say ok. She felt changing the language would probably not happen based on the economy. She said if the state was not going to use the sales tax money for LGA as required when it was authorized, then the sales tax should go away. Commissioner Nelson didn't think waiting a year would improve the city's finances, it was unrealistic. Fridley was not unique in any way to this demise and some the cuts being proposed now would eventually have to be purchased or completed, for instance, buying a new squad car, maintaining the University Avenue corridor or other things projects or equipment will be needed. He said the City would not retain employees by cutting their insurance benefits or freezing their salaries for two years. To make cuts because the citizens don't think the council will spend the money wisely is pretty short sighted. He would rather move this forward and let the council decide if they want to move it forward this year or not. He said to strap their hands now,might make it harder in the future. If not comfortable rather than delaying issue were two different reasons. We are here to do what is best for the city,not to delay the process. Commissioner Jorgenson said she understood, but said there were 158 foreclosed homes, over 200 people laid-off that she knew and things are not getting better for people. She felt placing an additional $50 or$60 on these people wasn't going to help. We were appointed by a district judge, not elected. The Charter Commission takes the time to see how it will impact the community and to watch legislation at the state level that may affect the City. She felt it would cause more distress in the community and felt it might be a good time for cities to review how they do business. She has looked at what other cities have done and how they may have saved money. She also wondered if it might be time for cities to combine services. She said there were some communities that did not provide a police department, because they used the sheriffs services. She felt the city could not continue to spend more while getting less and that it needed to be reviewed to see if it could be done better. Commissioner Kranz said he hasn't seen anything like this economy. He said all of the contracts with the Star and Tribute that the union had negotiated in good faith were thrown out in bankruptcy proceedings. The losses some individuals took with wage cuts were up to 40%. He said the City was in a unique position because we don't know what things will be like next year and that is why he was in favor of not overreacting and taking some time. CHARTER COMMISSION MEETING OF MARCH 23,2009 PAGE 4 Commissioner Borman said there was still the unknown of what the Legislature would do and felt there should be more time for discussion. Commissioner Hoiby asked why the Commission couldn't discuss how they wanted the amendment to appear and then wait to see what happened. Commissioner Findell felt the amendment petitioned for in 2000 was a knee-jerk reaction to the Council approving franchise fees changing what had worked for 57 or 58 years. He said it caused many problems and this Commission had worked to change the wrongs. He said they did not understand the unintended consequences it had caused. The City's bond rating almost went to nothing and the City lost the ability to bond for the utilities. It did not make sense that the electorate should be making decisions the City Council should be making. Commissioner Hoiby agreed and said individuals do not look at all of the information but rather a personal thing. Commissioner Reynolds said she had read the budget message and gone through the budget line- by-line and said she had found things she felt could be cut—she typed a report and sent it to the city manager. She said one of the cuts was depreciation on IS—taking it out of the budget—the city manager said the IS fund is sitting okay, so they can take it out—it's not like it is real money —it is depreciation. She agreed the average voter would not look at these issues. She said the purpose of the Charter was to meet the needs of the people—the people who said if they need more money they need to come to us. Commissioner Findell said the change in the charter language strapped the City and almost stopped the City from doing business. He said they had to call an ad hoc committee to change the original petition language. Putting it back where it was, no other community other than Mounds View has restrictions as tough as Fridley. Commissioner Borman wondered about the supermajority required to pass an issue. Commissioner Reynolds didn't think that Mounds View did. Commissioner Jorgenson felt the biggest thing was the governor tying the hands of the city. The City has gone through its reserves based on the loss of LGA and the cutbacks from the legislature. Commissioner Holm said the game would change and we should work expeditiously to amend the language to allow the council with a better means of running the City. At the same time, he did not personally agree with either of the amendments. As he looked at the history of what happened in 1999, the electorate did not want a franchise fees. In 2000 the petition state if you do put in a franchise fee,you have to go to the voters to request it. He said the other part that came about were restrictions on the city council before the loss of LGA. He felt an amendment that kept the restrictions on franchise fees, but recognizes that the ballgame has changed and we need to provide the city council with additional authority. He said there may be restrictions at the CHARTER COMMISSION MEETING OF MARCH 23,2009 PAGE 5 state level which might make that point moot, but felt it was important to discuss. He did not feel the amendment had to be put off until 2010. Commissioner Borman wondered if the Commission continue or table the discussion. He also wondered if changing the super majority restriction could help the council. Commissioner Jorgenson liked the idea,but felt the situation was not due to the charter restrictions. She thought language could be added which would say in the event in the loss of LGA,the city shall have the ability to raise taxes to offset that loss. Skogen said the governor had proposed the loss of LGA for 2009 and 2010. Commissioner Borman wondered how a city could prepare its budget, expecting money to come in, and then the state cuts the budget. Commissioner Braam said it was like someone paying you with a personal check or a payroll check which bounced after you have paid all of your bills and people are coming back to you now. Skogen suggested adding language that might help if there was a state deficit with a loss of funding to the city,that the city council would have the ability to pass a levy and would have to follow it by holding a public hearing and adopting a resolution. Commissioner Jorgenson said in January of 2001 there was 38 million in the reserve,they are down to less than 8 million now because of the cutbacks in LGA and other emergency provisions. She said the reserves were invested, but it is also not receiving the returns investments used to have. Commissioner Braam said we have to decide how to move forward,things are never going to be the same and did not think the City could live on LGA as in the past. Maybe it is the chance for the Charter Commission to lead the way, come up with suggestions on how to live through this and raise revenue. He did not like the city manager's idea of raising taxes, but wondered if charge for services could be increased. Commissioner Borman said the fire departments charged for services or the police department might start charge when you call to report issues. Commissioner Soule said the City still had an opportunity to get franchise fees if they went to the voters. Commissioner Holm said the voters spoke loudly about franchise fees—the council had to go to the people. He felt it was difficult to generate a team of people who could promote helping the city raise additional funding. Commissioner Borman wondered if the intent was making the City Council go to the voters to increase the levy. He wondered if changing the super majority to a simple majority would help CHARTER COMMISSION MEETING OF MARCH 23,2009 PAGE 6 the council if they went to the voters. He wondered if it was up to the City or up to the"No Fee Committee"to promote against the levy. Deb Skogen said the city could only provide education. Commissioner Braam said people appreciated the city's services, but felt it came to accountability. He said if the City said it would cost me an additional $100, would I feel like I received that$100 in services—voters want to make sure they are getting their monies worth. Commissioner Holm said he would send a proposal together and forward it to Deb Skogen. After further discussion, the Commissioners wanted to know where the reserves went and what reserve funds were used. 5. ADJOURNMENT: Commissioner Holm MOVED and Commissioner Kranz seconded a motion to adjourn the meeting. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON BORMAN DECLARED THE MOTION CARRIED AND THE MEETING WAS ADJOURNED AT 8:29 P.M. Respectfully submitted, Debra A. Skogen, Carol Hoiby, Secretary City Clerk/Staff Liaison CITY OF FRIDLEY CHARTER COMMISSION MEETING April 27,2009 CALL TO ORDER: Chairperson Soule called the Charter Commission meeting to order at 7:02 p.m. ROLL CALL: Members Present: Commissioners Borman,Braam,Findell,Hoiby,Holm,Jorgenson,Kranz,Nelson, Reynolds,Ryan, Soule and Scholzen Members Absent: Commissioners Plummer and Shaw Others Present: Deb Skogen,City Clerk/Staff Liaison Cindy Ruschy,Staff Assistant • APPROVAL OF AGENDA Commissioner Borman MOVED and Commissioner Braam seconded a motion approving the meeting agenda. UPON A VOICE VOTE,ALL VOTING AYE,CHAIRPERSON SOULE DECLARED THE MOTION CARRIED. APPROVAL OF MINUTES •'• The minutes were provided to the Commissioners at the beginning of the meeting,as City Clerk Skogen had just fmished the minutes that afternoon. She recommended tabling approval until they have had time to read the minutes. Commissioner Nelson MOVED and Commissioner Braam seconded a motion tabling approval of the March 23, 2009 Charter Commission meeting minutes to the next meeting. UPON A VOICE VOTE,ALL VOTING AYE,CHAIRPERSON SOULE DECLARED THE MOTION CARRIED. ADMINISTRATIVE MATTERS Skogen informed the Commissioners that Commissioner Mary Kirkwood had passed away last week. A card was provided to the Commissioners by Chairperson Soule to sign and provide to her family thanking them for her service to the City. A vacancy now exists and Skogen will have that information put on the cable and in the Sun Focus. DISCUSSION OF CHAPTER 7 Commissioner Holm said he had prepared Amendment C for the Commissioner to discussion. His amendment was drafted to recognize the vote by the electorate to restrict the city council action. To put it in context they could proceed promptly and adopt an amendment or wait for the legislature to act and for further discussion. He recommended waiting and suggested a timeframe of ending in October. Commissioner Holm MOVED and Commissioner Nelson seconded a motion to proceed to adopt amendment A,B or C or other amendment to adjust Chapter 7 to provide additional flexibility to the city council to increase revenues through taxes or fees with an October 2009,or sooner,end date. COMMISSIONER SOULE ASKED FOR FURTHER DISCUSSION. SEEING NONE SHE REQUESTED A VOTE AND THE MOTION CARRIED WITH A 10 TO 2 VOTE. COMMISSIONERS REYNOLDS AND JORGENSON VOTING NAY. CHARTER COMMISSION MEETING OFAPRIL 27,2009 PAGE 2 Commissioner Reynolds felt there was a problem with setting a timeline because there was so much happening at the legislature. She appreciated the work City Manager Burns had done,but had trouble removing all of the fee language. She said recycling was supposed to be self-funded and that there should not be increased above what the Charter states. She did not think removing the requirement to go to the voters should be deleted. She said the Mounds View Charter allowed their city to increase by a maximum of 5%,or CPI plus 2%. She felt setting parameters was more important and agreed the super majority restriction could go away. Commissioner Borman suggested leaving the 5%cap and removing the CPI restriction. This would allow the City to raise taxes without causing the city harm and believed the super majority restriction should be changed to simple majority. Commissioner Jorgenson said she had trouble with amendments B&C and did not want to micromanage,she felt comfortable with the Mounds View language. Commissioner Holm said the language in the section was not actually the original language,but language agreed to by a Task Force. He said recycling had to match the cost of providing the service. He said amendment C would not allow the city to put in a new fee like franchise fees or street lighting fees. He said Dr.Burns made a very good argument and the City does have a history of being frugal. He wondered why the city council should continue to have the flexibility. Commissioner Borman said he had been reading about other cities imposing street lighting fees. Commissioner Jorgenson disagreed that the state,county and city just wanting to fix problems by increasing taxes due to the number of foreclosures and properties that are currently not paying taxes. She wondered how unpaid taxes were collected and was concerned the foreclosures were creating the valuation decrease of residential properties. She said about$4-5 million of the budget actually came from property taxes and the rest of the revenue came from other funding sources. She felt it was time the city did things differently,which might include combining some services with other cities. Commissioner Kranz said the average market value for a house in Fridley was$175,000 and now it is$150,000,the City appears to be losing about$25,000 per house. If the tax base stays the same, it is a lot of money. It sounds like they should be paying less taxes. Commissioner Jorgenson said the taxes don't go down but rather get redistributed. Commissioner Findell said if a person's property was worth$150,00,but actually worthy$350,000,they would get a bonus by not paying taxes on that amount. Commissioner Brawn said commercial properties remain the same and then one day the value goes up because it has been undervalued. Commissioner Soule wondered if anyone wanted to see the actual petition language. The Commissioners agreed and it will be included in the next agenda packet. Commissioner Holm said if commercial values were the same and residential properties went from$200,000 to $150,000 and you were paying$1000 in property taxes on a$200,000 home,while the value of the house might go down,you are still going to pay$1000 in property taxes. So you pay the same amount even though your house might be valued less. It all depends on the total levy. Commissioner Nelson said the Senate bill has the LGA restored,the House bill has some restored but not to the extent of the Senate. Commissioner Jorgenson felt the residential taxes were lower because the city had more commercial and industrial property. CHARTER COMMISSION MEETING OFAPRIL 27,2009 PAGE 3 Commissioner Nelson reviewed property homestead values in other communities around the City. There was a discussion about administrative fmes or administrative tickets for traffic violations and whether or not the City could do them like Forest Lake did. It was unsure as there seems to be some dissension between the state and Forest Lake and whether or not it can actually provide for administrative fmes for traffic tickets. Commissioner Borman wondered if the Commission needed to start from scratch and go line by line or use one of the proposed amendments. Commissioner Findell favored the Holm Amendment because it took into consideration not only the petition language but also the direction of the task force that amended the language. Because they were holding their concerns in the charter in a much more worthwhile manner,rather than it was originally written,and it follows the guidelines they were trying to provide. Commissioner Jorgenson asked if anyone was in favor of Amendment A. Commissioner Holm said that gave the most flexibility to the Council and entrusted them to be frugal in the future as they have been in the past. Commissioner Findell said the word"all"in Section 7.03.3.A includes everyone and not just certain types of property owner and wasn't sure it was appropriate. Commissioner Nelson MOVED and Commissioner Findell seconded a motion that Amendment A be taken off the table and no longer considered for discussion. UPON A VOICE VOTE,ALL VOTING AYE,CHAIRPERSON SOULE DECLARED THE MOTION CARRIED. Commissioner Nelson said if the LGA is restored,the City would still be frugal and not raise taxes. They could adopt B or the Holm amendment. He said every city council was wrestling with this know if they go over the top, they would not be re-elected. They were all their willing to do their best for the city. He said he was aware of all of the foreclosed properties by he also liked having the police come up and down the road on a consistent basis and having the city come and fix a water main break and patch the road quickly. Those services come with costs and he was willing to pay for those services. He felt the discussion of the Commission could help provide direction to the Council and the public at the public hearing. He did not feel the City Council's hands should be tied in the city they all live in and that we want to have all of the services. He said there are cities that have been successful by removing the police department,and those that haven't. But those are questions that really need to be asked before decreasing services. He would rather provide an amendment and let the public decide. Commissioner Holm said it was an issue of local vs non-local control which had its benefits and risks. He said undoubtedly you need to address cost savings at some point. He felt the main sticking point between Amendment B and C—one calls for council approval and one for voter approval on fees. Commissioner Nelson MOVED and Commissioner Jorgenson seconded a motion to use the Holm C Amendment as a template for discussion. UPON A VOICE VOTE,ALL VOTING AYE,CHAIRPERSON SOULE DECLARED THE MOTION CARRIED. Commissioner Reynolds asked for the section of Chapter 7 that was changed in February changing the word least to less. Commissioner Soule said the Commission talked about the Mounds View charter showing no limitations. The Commission would cross out the 5%and change to the inflationary index. Commissioner Borman said the inflationary index has been about 1.2%or 1.3%,which isn't very much. Commissioner Braam said they got into trouble because the Met Council fees increased higher than what the City could increase their fees. He wondered if there was some language that could be put in about pass-through fees or CHARTER COMMISSION MEETING OFAPRIL 27,2009 PAGE 4 fees that are increased by another agency that the city has no control over. Commissioner Reynolds felt they needed to keep the language. Commissioner Braam said they needed to put in some type of protection that any fees incurred by the city are passed on. Commissioner Borman wondered what another external fee imposed on the city that might incur,other than utility fees that would impact the cost of running the city. Commissioner Holm said if it impacts any particular operation that is charged for separately than property taxes,the city could pass on those fees. Commissioner Jorgenson said an instance might be where the State decided a state highway were turned back to a city or county road and the cost of maintaining that road would not be a new cost to the city. Commissioner Jorgenson said there were a lot of things that could be turned back over to the cities and discussed the city's water supply and the possible need to upgrade three of the city's wells due to possible contamination. Commissioner Borman wondered if there was language that could address that. Commissioner Nelson said hopefully the city would budget ahead of time for a project like that rather than increasing taxes to do the project. He said we could beat themselves up about the unknown,but we don't always know the unknown. Commissioner Findell said Chapter 11 still covers the passing on excessive costs,as you cannot make a profit on utilities. Commissioner Reynolds felt it was also addressed earlier in Chapter 7 where it talks about what type of funds to be kept. There was then a discussion about whether or not they could plan for things that might or might not happen in the future and it was agreed they could not. Commissioner Nelson MOVED and Commissioner Findell seconded a motion changing super majority to simple majority. Commissioner Soule wanted to clarify the language and understood it to mean the removal of the vote by the public for the tax increase over and above the rate of inflation and requiring it be a supermajority of the council. There would be no vote over and above that rate for the public. The Commissioners agreed. Section 3 creates a vote for new fees but only requires a majority rather than a super majority for approval. Commissioner Reynolds wondered about keeping 7.03.E regarding natural disasters. Commissioner Nelson suggested moving it to 7.03.4 as it does not reflect new fees and the Commissioners agreed. Commissioner Reynolds said the referendum/petition committee was aware of the changes that were made to the petition and they were not happy with the language either. Commissioner Holm said Section 7.02.1. shows the word"as"was crossed out and shouldn't be and staff should look up the definition impliedly and suggested changing it to granted or implied. Commissioner Reynolds did not feel the council should be able to raise taxes without going to the voters and felt the amendment gave them too much power. She felt there were going to be some parameters in place that allow them to generate revenue,beyond that amount,the voters need to have a say in going above that percent. Commissioner Braam said the council was elected by the citizens and the citizens would have a say about the increase in taxes at a public hearing. He said if people were concerned,they would attend a meeting. Commissioner Borman said it could also be repealed by referendum. CHARTER COMMISSION MEETING OFAPRIL 27,2009 PAGE 5 Commissioner Reynolds felt with this language the city would end up with a referendum petition. Commissioner Jorgenson said the amendment changes the language back to what the council had before 2000 petition. Commissioner Findell said the petition was introduced was because the franchise fees were adopted after the voters told them not to adopt them. FUTURE ITEMS The Commission will continue the discussion of Chapter 7 and really review Section 7.03. Please provide a copy of the C Amendment with strikeouts on the blue and without strikeouts—so as it would read on another color paper. ADJOURNMENT: Commissioner Kranz MOVED and Commissioner Hoiby seconded a motion to adjourn the meeting. UPON A VOICE VOTE,ALL VOTING AYE,CHAIRPERSON SOULE DECLARED THE MOTION CARRIED AND THE MEETING WAS ADJOURNED AT 8:30 P.M. Respectfully submitted, Debra A. Skogen, Carol Hoiby, Secretary City Clerk/Staff Liaison • Fridley City Charter Chapter 7 ct i on 7.03 p re, o oeom FRIDLEY CITY CHARTER CHAPTER 7. TAXATION AND FINANCES. J L Section 7.01. COUNCIL TO CONTROL FINANCES. The Council shall have full authority over the financial affairs of the City, and shall provide for the collection of all revenues and other assets, the auditing and settlement of accounts, and the safekeeping and disbursement of public moneys. In the exercise of a sound discretion it shall make provisions for the payment of all liabilities and expenses. The Council shall establish the fiscal year for the City. Section 7.02. POWER OF TAXATION. 1. 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 from time to time, provided that the amount of taxes levied against real and personal property within the City for general City purposes shall not exceed in dollars, a tax levy that is greater than the prior year tax levy increased by an inflationary index,. defined by the U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index for all Urban Consumers in the Minneapolis, St. Paul metropolitan area. 2. The City Council may also levy a tax in any year against real and personal property within the City in addition to said limit as defined in paragraph 1 provided the Council shall: A. Adopt a resolution declaring the necessity for an additional tax levy and specifying the purposes for which such additional tax levy is required. B. Hold a public hearing pursuant to three (3) weeks' published notice in the official newspaper of the City setting forth the contents of the resolution described in Subdivision A. C. Adopt after such public hearing a resolution by an affirmative vote of a least four(4) members of the Council which resolution provides for such levy. (Ord 592 and 1102) Section 7.03. BOARD OF REVIEW. The Council shall constitute a board of review and shall meet as such in the usual place for holding Council meetings to equalize the assessed valuations according to law, and a published notice of such meeting shall be given in the official newspaper of the City at least ten (10) days prior to the day of said meeting. (Ref. Special Election 4/12/60, Ord. 592) Fridley City Charter Chapter 7 Section 7.05 Section 7.04. PREPARATION OF ANNUAL BUDGET. 1. The City Manager shall prepare the estimates for the annual budget which shall include any estimated deficit for the current year. The estimates of expenditures shall be submitted by each department to the City Manager. Each estimate shall be divided into three (3) major subdivisions as follows: (a) Salaries and Wages, (b) Ordinary Expenses, (c) Capital Outlay. Salary detail shall show a list of all salaried officers and positions with salary allowance and number of persons holding each. Wages shall be broken down in sufficient detail to justify the request. Ordinary expenses shall be broken down into such detail as the City Manager shall direct. Capital Outlay shall be itemized as to items and amounts. (Ref. Ord. 625) 2. In parallel columns shall be added the amounts expended under similar headings for the two (2) preceding fiscal years, and, as far as practicable, the amounts expended and estimated for expenditure during the current year. In addition to estimates of expenditures, the City Manager shall prepare a detailed statement of revenues collected for the two (2) preceding completed fiscal years with amounts estimated to be collected for the current fiscal year, and an estimate of revenues for the ensuing fiscal year. The estimates shall be submitted o the Council at its last regular monthly meeting in August and shall be published twice in summary in the official Publication prior to November 15. (Ref. Ord. 625, Ord. 946) Section 7.05. PASSAGE OF THE BUDGET. The budget shall be a principal item of business at the last regular monthly meeting of the Council in August, and the Council shall hold subsequent meetings from time to time until all the estimates have been considered. The meetings shall be so conducted as to give interested citizens a reasonable amount of time in which to be heard, and an opportunity to ask questions. The budget estimates shall be read in full and the City Manager shall explain the various items thereof as fully as may be deemed necessary by the Council. The annual budget finally agreed upon shall set forth in such detail as may be determined by the City Council, the complete financial plan of the City for the ensuing fiscal year, and shall be signed by the majority of the Councilupon being adopted. It shall indicate the sums to be raised and from what sources, and the sums to be spent and for what purposes, according to the plan indicated in Section 7.04. The total sum appropriated shall not exceed the total estimated revenue. The Council shall adopt the budget by resolution in accordance with State Law. The resolution shall set forth the total of the budget and the totals of the major divisions of the budget, according to the plan indicated in Section 7.04. The budget resolution as adopted shall be published in the official publication. (Ref. Ord. 625, Ord. 946) Fridley City Charter Chapter 7 Section 7.09 Section 7.06. ENFORCEMENT OF THE BUDGET. It shall be the duty of the City Manager to enforce strictly the provisions of the budget. The City Manager shall not approve any order upon the City Treasurer for any expenditure unless an appropriation has been made in the budget, nor for any expenditure covered by the budget unless there is sufficient = •1 -d balance left after deducting the total past expenditures and the sum of all outstanding . • -rs and brance No officer or employee of the City shall place any orders or make any purchases e or the purposes and to the amounts authorized in the budget. Any obligation incurred by any person in the employ of the City for any purpose not authorized in the budget or for any amount in excess of the amount therein authorized shall be a personal obligation upon the person incurring the expenditure. (Ref. Ord. 857) Section 7.07. ALTERATIONS IN THE BUDGET. After the budget shall have been duly adopted, the Council shall not have power to increase the amounts therein fixed, whether by the insertion of new items or otherwise, beyond the estimated revenues, unless the actual receipts shall exceed such estimates, and in that event, not beyond such actual receipts. The sums fixed in the budget shall be and become appropriated at the beginning of the fiscal year for the several purposes named therein, and no other. The Council may at any time, by resolution passed by a vote of at least four (4) members of the Council, reduce salaries or the sums appropriated for any purpose by the budget, or by vote of at least four (4) members of the Council authorize the transfer of sums from the unexpended balances of the budget to other purposes. (Ref. Ord. 946) Section 7.08. EMERGENCY APPROPRIATION IN THE BUDGET. 1. The Council shall have power to establish an emergency appropriation as a part of the budget, but not to exceed ten percent (10%) of the total budget. Transfers from the emergency appropriation to any other appropriation shall be made only by a vote of at least four(4)members of the Council. 2. The sums transferred to the several departments or divisions shall be considered as a part of such appropriations and shall be used only for the purposes designated by the Council. Section 7.09. LEVY AND COLLECTION OF TAXES. In accordance with Minnesota State Law,the Council shall levy by resolution the taxes necessary to meet the requirements of the budget for the ensuing fiscal year. The City Clerk shall transmit to the county auditor annually, not later than the date required by Minnesota Law, a statement of all the taxes levied, and such taxes shall be collected and the payment thereof be enforced with and in like manner as state and county taxes. No tax shall be invalid by reason of any informality in the manner of levying the same, nor because the amount levied shall exceed the amount required to be raised for the special purpose for which the same is levied, but in that case the surplus shall go into a suspense fund, and shall be used to reduce the levy for the ensuing year. (Ref. Ord. 625, Ord. 946) Fridley City Charter Chapter 7 Section 7.12.0 Section 7.10. TAX SETTLEMENT WITH COUNTY. The City Treasurer shall see to it that all moneys in the county treasury belonging to the City are promptly turned over to the City according to law. Section 7.11. DISBURSEMENTS,HOW MADE. All disbursements shall be made only upon the order of the City Manager and City Clerk, duly authorized by a resolution or motion of the Council, and every such order shall specify the purpose for which the disbursement is made, and indicate the fund out of which it is to be paid. Each such order shall be directed to the Treasurer, and the latter shall issue a check payable to the order of the person in whose favor the order was drawn. The Treasurer shall issue no check upon any City sV funds except upon such order. In the discretion of the Council the order and check may be a single SS•Y instrument. No claim against the City shall be allowed unless accompanied by either an itemized bill, or a payroll, or time sheet, each of which shall be ap ved and signed by the responsible City ti' officer who vouches for the correctness and real bleness reof. The Council may by ordinance make additional regulations for the safekee • and di Bement of the City's funds. The Council may by resolution or motion provide for the regular payment without specific individual authorization by the Council of salaries and wages of regular employees, laborers,and fixed charges which have been previously duly and regularly incurred. '� Section 7.12. FUNDS TO BE KEPT. There shall be maintained in the City Treasury the following funds: A. A general fund for the payment of such expenses of the City as the Council may deem proper. Into this fund shall be paid all money not provided herein or by statute to be paid into any other fund. B. A debt service fund, into which shall be paid all receipts from taxes or other sources for the payment of principal and interest of all obligations issued by the City except bonds issued on account of any local improvement to be financed wholly or partly by special assessments and bonds issued on account of any municipally owned utility. Out of this fund shall be paid the principal and interest of such obligations when due. Any surplus in such fund not needed immediately for debt service may be invested under the direction of the Council in such securities as are authorized by statute for the investment of such funds and such investments may be liquidated at any time. C. A bond fund, into which shall be paid and disbursed the proceeds of all bonds issued by the City except bonds issued on account of any local improvement to be financed wholly or partly by special assessments and bonds issued on account of any municipally owned utility. A separate bond account shall be kept for each issue of such bonds. Fridley City Charter Chapter 7 Section 7.12.F D. A special assessment fund, which shall be used to finance local improvements that are to be paid for, in whole or in part, from special assessments against benefited property. There shall be paid into this fund: (1) collections of special assessments, with interest, levied against benefited property; (2) proceeds of bonds or certificates of indebtedness sold by the City in anticipation of assessment collections and the proceeds of interfund loans; (3) amounts from other City funds representing either (a) apportionments of costs against the City at large, (b)benefit assessments against City property, or(c) appropriations to maintain the integrity of the fund. There shall be paid out of this fund: (1) all expenses and costs of the improvement projects that �, are financed through the fund; (2) the redemption of all special assessment fund�� u bonds and certificates of indebtedness, with interest, at or before maturity, and any cN� interfund loans; (3) transfers to the general fund of any unencumbered surplus of the fund, in the discretion of the Council; and (4) abatements of assessments and refunds of receipts in error. The Council shall maintain the integrity of this fund by appropriations from tax funds if necessary, and in addition may by ordinance create and maintain in the fund a cash reserve sufficient for working capital purposes. In order to anticipate the collection of special assessments the Council may by a majority vote issue and sell bonds and certificates of indebtedness, pledging the full faith and credit of the City, or pledging only special assessments, in such amounts and maturities as it may determine, regardless of the provisions of Section 7.16 of this Chapter; provided that the aggregate amount of such bonds and certificates outstanding at any time shall not exceed the sum of the following; (1) all assessments levied and uncollected; (2) assessable cost of work in progress; and (3) the cash reserve for working capital as previously determined by ordinance. In order that the fund may be administered on a self-sustaining basis, all improvement projects financed through it shall upon completion be certified by the City Manager as to total cost, which shall thereupon be apportioned by the Council either as assessments against benefited property or as amounts due from other City funds. Amounts apportioned against other City funds shall be due not later than the dates of adoption of the corresponding assessment rolls, shall be charged interest as in the case of assessments and shall be paid into the fund,with any interest due,not later than one(1)year after the due dates. E. A public utility fund into which shall be paid all money derived from the sale of bonds issued on account of any municipally owned utility and all money derived from the sale of utility services, and from the sale of any property acquired for or used in connection with any such utility. There shall be paid out of this fund the cost of the purchase, construction, operation, maintenance and repair of such utility, including the principal of and interest upon obligations which have been or shall be issued on its account. Separate accounts within the public utility fund shall be kept for all utilities which are operated separately. F. In addition to the foregoing funds, there may be maintained in the City Treasury, whenever the Council deems it advisable,the following funds: Fridley City Charter Chapter 7 Section 7.14 1. A working capital or revolving fund, for financing self-sustaining activities not accounted for through other funds. 2. A trust and agency fund, for the care and disbursement of money received and held by the City as trustee or custodian or in the capacity of an agent for individuals or other governmental units. 3. Such other funds as may be required by statute or ordinance. In lieu of establishing any of the three (3) foregoing types of funds, Subsections 1,2, and 3,the Council may provide for e recording of operations or activities for which the use of such fun night b suitable through the maintenance of separate accounts in any appropriate fund already established. The Council shall have full power to make by duly adopted ordinance such interfund loans, except from funds held under Subsection 2 hereof,as it may deem necessary and appropriate from time to time. Section 7.13. RECEIPTS TO GO TO CITY TREASURER. All receipts of money belonging to the City, or any branch thereof, excepting only those funds collected by the County Treasurer, shall be paid to the City Treasurer by the person authorized to receive the same. All such moneys, and also all moneys received upon tax settlements from the County Treasurer, shall be deposited as soon as possible in a bank or banks approved by the City Council, subject to state laws regulating the designation of depositories for municipal funds. Section 7.14. ACCOUNTS AND REPORTS. The City Manager shall be the Chief Accounting Officer of the City and of every branch thereof, and the Council may prescribe and enforce proper accounting methods, forms, blanks, and other devices consistent with the law, this Charter and the ordinances in accord with it. The City Manager shall submit to the Council a statement each month showing the amount of money in the custody of the City Treasurer,the status of all funds,the amount spent or chargeable against each of the annual budget allowances and the balances left in each and such other information relative to the finances of the City as the Council may require. The Council may at any time and shall annually provide for an audit of the City finances by a certified public accountant or by the department of the State authorized to make examination of the affairs of municipalities. On or before the first day of April in each year the City Manager shall prepare a complete financial statement in form approved by the Council of the City's financial operations for the preceding calendar year, and quarter, which statement may be published in such manner as the Council may direct and a summary thereof shall be published in the official newspaper on or before the third week in April,July, October and January as appropriate. (Ref. Ord. 625, Ord. 857) • Fridley City Charter Chapter 7 Section 7.15.2 �,..r Section 7.15. BONDED DEBT AND DEBT LIMIT. 1. In addition to all the powers in respect to borrowing and the issuance of bonds and other obligations for the payment of money specifically or impliedly granted by this Charter, and any amendments thereto, the City shall have all the powers in reference to these subject matters granted to cities of its same class by the laws of the State of Minnesota in force from time to time. The City shall have the power to issue and sell its bonds to the State of Minnesota and to comply with all provisions of law relative to loans to municipalities from the permanent State funds. The City shall also have such powers as are necessary to obtain loans or funds from the Government of the United States and any of its instrumentalities or from the State of Minnesota or any of its instrumentalities, and to comply with all provisions of law relative to obtaining such loans or funds. 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. By the proceedings for the issuance of any bonds, by the terms of the bonds and by agreements with the purchasers of bonds, they may be made special in character and limited in their payment to earnings or to part earnings and part tax funds. To the extent that they are thus payable out of earnings or other than tax funds, such bonds shall not be paid out of taxes. The total bonded debt of the City at the time of the issuance of any bonds shall not exceed ten percent (10%) of the last assessed valuation of the taxable property therein, or the limit authorized by State law for cities of the same class, whichever is the greater, but in computing the total ,i✓ bonded debt, certificates of indebtedness, bonds,warrants or other obligations issued before or after adoption of this Charter shall not be included or counted if(1)held ir( g fund a' maintained by the City; or(2) issued for the acquisition, equipment, purchase, construction, maintenance, extension, enlargement or improvement of street railways, telegraph or telephone lines, water, lighting, heat and power plants, or either, or any other public convenience from which a revenue is or may be derived, owned and operated by the City, or the acquisition of property needed in connection therewith, or for the construction of public drainage ditches, storm and sanitary sewers, or for the acquisition of lands for streets,parks, or other public improvements or for the improvement thereof, to the extent that they are payable from the proceeds of assessments levied upon property especially benefited by such improvements; or (3) issued for the creation of maintenance of a permanent improvement revolving fund; or (4) for the purpose of anticipating the collection of general taxes for the year in which issued. (Ref. Ord. 857) Fridley City Charter Chapter 7 Section 7.18 Section 7.16. FORM AND REPAYMENT OF BONDS. No bonds shall be issued to run for longer than the reasonable life expectancy of the property or improvement for which the bonds are authorized, as ascertained and set forth in the resolution authorizing such bonds, and in no case shall bonds be issued to run for more than thirty (30) years. The purposes for which bonds are authorized shall be set forth in the resolution authorizing them and the proceeds from such bonds shall not be diverted to any other purpose. It shall be the duty of the City Manager to include in the budget estimates each year a sum or sums amply sufficient to pay the principal of, and the interest on, any bonds which are to fall due in the coming fiscal year, and another sum sufficient to pay the interest for the same year on the Bonds which will be still outstanding. It shall be the duty of the Council, enforceable by t aandamus upon the suit of any 'Jsf.4 bondholder or taxpayer, to include such sum or sums as may be necessary for this purpose in the annual budget which it passes. (Ref. Ord. 857) Section 7.17. DEBT AND TAX ANTICIPATION CERTIFICATES. 1. 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 authorize the sale by the City Treasurer of emergency debt certificates to run not to exceed eighteen (18)months and to bear interest at not more than allowable by State Statutes. A tax sufficient to redeem all such certificates at maturity shall be levied as part of the budget of the following year. The authorization of an issue of such emergency debt certificates shall take the form of an ordinance approved by at least four (4) of the members of the Council; the ordinance may, if deemed necessary, be passed as an emergency ordinance. (Ref. Ord. 592) 2. For the purpose of providing necessary moneys to meet authorized expenditures, the Council may issue certificates of indebtedness in any year prior to the receipt of taxes payable in such year, on such terms and conditions as it may determine,bearing interest at a rate not more than allowable by State Statutes; provided that such certificates outstanding at any one time shall not exceed forty percent(40%)of the tax levy payable in the current year belonging to the fund for the benefit of which the borrowing is authorized. (Ref. Ord. 592) Section 7.18. BONDS OUTSIDE THE DEBT LIMIT. Without limit as to amount, the Council may issue bonds for legal purposes outside of the debt limit: (a) for the creation and maintenance of a permanent improvement revolving fund, (b) for extending, enlarging, or improving water supply system, lighting and heat and power plants, or either, or other revenue-producing public utilities of whatever nature, owned and operated by the City, or of acquiring property needed in connection therewith, (c) for public improvements payable from special assessments. The Council may also purchase equipment for street department, water or sewer utility, or fire department use on conditional sale contracts, provided that the installment payments do not extend beyond the estimated useful life of the equipment so purchased. Page 1 of 2 Skogen, Deb From: Cindy Soule[CSOULE©elcabop.org] Sent: Monday, May 04, 2009 8:25 AM To: Bill and Sue Holm; Pam Reynolds; Don Findell; Gary Braam; Keith Shaw; Leslie Plummer; Lois Scholzen; nancy jorgenson; Peter Borman; Rick Nelson Cc: Skogen, Deb Subject: RE: Charter Amendment, Chapter 7 Deb, Please include the content of this e-mail with the packet for May. Thanks Cindy From: Bill and Sue Holm [mailto:holm @goldengate.net] Sent: Sunday, May 03, 2009 7:46 PM To: Cindy Soule; Pam Reynolds; Don Findell; Gary Braam; Keith Shaw; Leslie Plummer; Lois Scholzen; nancy jorgenson; Peter Borman; Rick Nelson Cc: Deb Skogen Subject: Charter Amendment, Chapter 7 Members of the Charter Commission: Following is the text of Pam Reynolds message that you received concerning the proposal to amend Chapter 7 of the City Charter. (I did not include the attachment provided by Pam that deals with the proposed legislation now being considered in the Minnesota legislature.) Since I will not be able to attend the May meeting, and since Pam Reynolds has stated her views, I thought I should also make a few comments on the issues involved with the proposed changes to Chapter 7. As you know, the Charter Commission voted to pursue an amendment to Chapter 7 to be submitted to the City Council by October, 2009. Assuming the legislature adjourns on time, at the May Commission meeting we should be aware of how such legislation will impact city finances. If a special session is involved, we probably won't know the end result until we reconvene in September. Nevertheless, the Commission can still pursue a careful review of changes to Chapter 7 in time to meet our October target date. In considering the proposed changes, perhaps the best way to proceed is to first obtain concurrence on the changes in procedures for voter approval of any"new"fees-change to simple majority by voters instead of the "supermajority" currently required. If we agree on that issue, then the remaining issue is whether or not to remove or alter the current provision that requires voter approval for any tax levy increase above the rate of inflation or 5%, whichever is less. (Note: the proposed language also permits the Council to adjust fees for existing services so as to match costs and revenues, and does away with voter approval for such increases above the rate of inflation.) On that issue, I must say I disagree with Pam Reynolds' position to continue to require voter approval of such changes. I say this for a number of reasons, including the following: -The rules by which the City of Fridley can finance its operations have changes, and will change even more so in the next few years. The City Council needs more flexibility to address its financial requirements. -The City has been frugal with its finances and operates to meet the needs of its citizens. -Citizens can still influence Council spending by attending hearings concerning larger than normal tax hikes and voicing their opinions, and by voting incumbent council members out of office if they feel the Council is spending too freely. -Obtaining voter approval of such changes is costly and cumbersome, may require Council to approve a pared down budget to submit to the County in case voters do not approve a levy increase, and force the Council into a 5/7/2009 Page 2 of 2 budget cycle that imposes hardship upon the Fridley citizens. A clear case in point is the recent approval by voters to permit the City to increase water and sewer fees above the rate of inflation. Had voters not approved the increase, the City's entire financial structure would have soon been in dire straits. It took a substantial effort and multiple times of voting on this issue before voter approval was obtained. Why? Because voters did not fully understand the impact of the reasons for the increase, that many of n the costs were beyond the City's control. Because of these factors, I believe it is important for the Commission to act on these changes, recognizing that the financial process for the City has changed dramatically in the past 10 years. I do not take changes to the City Charter lightly, nor do I believe we are over-riding voter intent by the changes we are considering. Similar to the water and sewer issue, I believe the Commission is doing its job by addressing these financial issues in a prompt manner. Finally, I agree with Pam Reynolds that we do not know the full impact of actions by the state legislature and the Governor concerning City finances. If the impact is minimal, we may wish to adjust our changes accordingly. My personal view, however, is that the proposed changes are reasonable and appropriate. I might be persuaded otherwise if the legislature and Governor enact legislation that restores local financing to reasonable levels. Thanks for the opportunity to comment in advance of the meeting, and my apologies for being long-winded. See you all in September. Have a nice Summer!! Bill Holm Pam Reynolds comments: Members of the Charter Commission: After review of the Omnibus Tax Bill and additional time spent rethinking the conversations from our Monday meeting I wanted to let you know that I cannot support any change to Chapter 7.02, Section 2. To remove the requirement to take levy increases to the voters would be, in my opinion, a violation of the commission purpose which is: To frame and amend the Charter to meet the needs of the people. If the requirement for voter approval is removed I will personally work with other citizens to defeat the language change. I would however support the new language, created by Bill Holm, requiring voter approval of new fees based on the number of new ones that will be allowed at the city level if this bill passes. I have attached a side-by-side comparison of HF2323 and SF2074 for your reading pleasure. Respectfully, Pam Reynolds 5/7/2009 Page 1 of 1 Skogen, Deb From: Cindy Soule[CSOULE @elcabop.org] Sent: Monday, May 04, 2009 8:28 AM To: Skogen, Deb Cc: Pam Reynolds; Bill Holm; Don Findell; Gary Braam; Keith Shaw; Leslie Plummer; Lois Scholzen; nancy jorgenson; Peter Borman; Rick Nelson Subject: FW: Attachments: HOUSE RESEARCH Deb, Please include the content of this e-mail and its attachment with the May Charter Commissions packet. Thanks, Cindy From: Pam Reynolds [mailto:fnpam @hotmail.com] Sent: Saturday, May 02, 2009 1:51 PM To: Bill Holm; Cindy Soule; Don Findell; Gary Braam; Keith Shaw; Leslie Plummer; Lois Scholzen; nancy Jorgenson; Peter Borman; Rick Nelson Subject: n Members of the Charter Commission: After review of the Omnibus Tax Bill and additional time spent rethinking the conversations from our Monday meeting I wanted to let you know that I cannot support any change to Chapter 7.02,• Section 2. To remove the requirement to take levy increases to the voters would be, in my opinion, a violation of the commission purpose which is: To frame and amend the Charter to meet the needs of the people. If the requirement for voter approval is removed I will personally work with other citizens to defeat the language change. I would however support the new language, created by Bill Holm, requiring voter approval of new fees based on the number of new ones that will be allowed at the city level if this bill passes. I have attached a side-by-side comparison of HF2323 and SF2074 for your reading pleasure. Respectfully, Pam Reynolds Hotmail® has ever-growing storage! Don't worry about storage limits. Check it out. n 5/7/2009 Proposed City Charter Amendment Appendix B-26 Language to be removed is stgekeft Language to be added is bold and underlined. The following modifications are proposed for CHAPTER 7 of the city charter, t"-"•\ titled TAXATION AND FINANCES: Section 7.02.POWER OF TAXATION. 1. The City shall have, in addition to the powers by this Charter expressly or impliedly grarited;:allthkpoi*ilO raise money by taxation pursuant to the laws of the State which-are applicable to cities*the:::elaSili5f*rbialiiii may be a member from time to time,provided that the amount of taxes levied against real and personal property within the City for general City purposes Shall not exceed in dollars, a:taXlevithat is greater than the iox3year tax levy increased by an inflation*index,or 5%.whichever is leastSaid Inflationary Index shill be defined by the U.S. Department Of Labor, Bureau of Labor Statistics, Consumer-Price:Index for alLtTrban Consumers in the Minneapolis,St:Paul metropolitan area.(Ref. Ord.592 and 1102) 2. The City Council may also levy a tax 4-afty-year against real and personal property within the City in addition to said limit as defined in paragraph 1 provided the Council shall: A. Adopt a resolution declaring the necessity for an additional tax levy and specifying the purposes for which such additional tax levy is required. B. Hold a public hearing pursuant to three (3) weeks' published notice in the official newspaper of the City setting forth the contents of the resolution described in Subdivision A. . _ C. Adopt after such public hearing a resolution by an affirmative vote of a least four (4) members of the Council which feseletie&-pweieles-ferstieli4evy.i shall be presented as a cliar and concise 'plain language' ballot question at the next regular municipal election.(Ref. • D. The additional tax levy shall take effect if 51% of the votes cast at said election are in favor of its adoption. * 3. Any other fees created, or increased beyond the limits set forth in subsection 1. shall require voter approval as stipulated in subsection 2. - A. For the purposes of this subsection. "fees" includes, but is not necessarily limited to. Sales and use taxes, business and occupation taxes, excise taxes, impact fees, license fees, permit fees and any discretionary monetary chargiby*City government.•-• • B. For the'PurpOieitif not include: Parks and Recreation Department narticination.fees;-charzes.fortnhototoniring. sales of municipal liquor store products. or Civil and criminal fines and other charges collected in cases of restitution or violation of laiv"Or contract.'. C. For the purposes of this subsection. "fee increase" inchides:tut is not neieiiiii(fliiniteTto;lifleii tax or fee, a monetary increase in an existing tax or fee, a tax or fee i.ate increase:'an expansion In the legal definition of a tax or fee base.and an extension of an expiring tax or fee.D. For the purposes of this subsection. "city" includes, but is not necessarily limited to. the city and all its departments and agencies,special district,and other political subdivision or governmental instruMentality'Of or within the city;-.:,- E. For the purpose of addressing natural disasters this subsection does not apply to any specific measure authorized in Chapter 7 section.08(7.08). Appendix B-27 ORDINANCE NO. 1152 kF r .�, 114414' AN ORDINANCE AMENDING CHAPTER 7 OF THE FRIDLEY CITY CHARTER PERTAINING TO TAXATION AND FINANCES The City Council of the City of Fridley does hereby ordain as follows: That Section 7.02.1 of the Fridley City Charter be hereby amended as follows: Section 7.02. POWER OF TAXATION 1. 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 from time to time,provided that the amount of taxes levied against real and personal property within the City for general City purposes shall not exceed in dollars, a tax levy that is greater than the prior year tax levy increased by an inflationary index, or 5%,whichever is least. Said inflationary index shall be that as defined by the U.S.Department of Labor,Bureau of Labor Statistics,Consumer Price Index for all Urban Consumers in the Minneapolis-St. Paul Metropolitan Area. (Ref. Ord. 592 and 1102 and 11/7/00 Amendment) Nothing in this provision shall be construed to impair any general obligation the City may have in support of otherwise lawful indebtedness or similar obligation supported by the full faith and credit of the City, provided, however, that long-term,_general obligation indebtedness shall not be used for the purpose of funding the routine and daily business operations of the City. That Section 7.02.3 of the Fridley City Charter be hereby amended as follows: 3. Any other fees created,or increased beyond the limits set forth in subsection 1, shall require voter approval as stipulated in subsection 2. A. For purposes of this subsection,"fees"includes, , sales and use taxes, = •• _-: - -- - - - . _ - -- '... .-• gevemiaent, utility charges, recvclingfees, gas and electric franchise fees and any other fee that produces a tax burden or direct financial obligation for all • property owners and/or residents of Fridley. B. For the purposes of this section,the term "fees"does not include: Parks and Recreation Department participation fees, charges for photo-copying, sales of municipal liquor store products,or civil and criminal fines and other charges collected in cases of restitution or violation of law or contract. The term 'fees" also does not include rental housing fees, buildingpermit fees, liquor license fees, the extension or transfer of cable television service authority to additional service providers for which fees are already being charged, fees for the operation ofjunk Appendix B-27 Ordinance No. 1152 Page 2 yards. annual license fees for the operation of pawn shops and other regulated business, and any other charge for services. including health and safety related /'N Code enforcement, and other goods, services or materials routinely provided by the City to its citizens or other members of the public which, by law, must be limited to the actual cost of the service being provided. The term 'fees"shall not include any special assessments made under Minnesota Statutes 6429. C. For the purposes of this subsection, "fee increase"includes, limited-te-,-a new tax or fee,a monetary increase in an existing tax or fee, a tax or fee rate increase, an expansion in the legal definition of a tax or fee base,and an extension of an expiring tax or fee. D. For the purposes of this subsection, "city"include sr te the City itself and all of its departments and agenci , that are organized to exercise the "Powers of the City"as defined in Chapter 1 of this Charter. "City"shall not include any body ofzovernment owing its existence to separate constitutional or statutory authority outside of the Charter, regardless of whether that other body of government has jurisdiction or performs duties and services within the boundaries of the City. E. For the purpose of addressing natural disasters this subsection does not apply to any specific emergency measure authorized in Chapter 7, Section .08 (7.08). PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 9th DAY OF APRIL 2001. Scott J. Lund,Mayor ATTEST: Debra A. Skogen, City Clerk Public Hearing: March 5,2001 First Reading: March 26,2001 Second Reading: April 9,2001 Publication: April 19,2001 LvuAi C-1) a-16' 7 FRIDLEY-CITY CHARTER ' \ CHAPTER 7. TAXATION AND FINANCES. Section 7.01. COUNCIL TO CONTROL FINANCES. The Council shall have full authority over the financial affairs of the City, and shall provide for the collection of all revenues and other assets, the auditing and settlement of accounts, and the safekeeping and disbursement of public moneys. In the exercise of a sound discretion it shall make provisions for the payment of all liabilities and expenses. The Council shall establish the fiscal year for the City. Section 7.02. POWER OF TAXATION. 1. 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 from time to time, provided that the amount of taxes levied against real and personal property within the City for general City purposes shall not exceed in dollars, a tax levy that is greater than the prior year tax levy increased by an inflationary index, or 5%, whichever is least. Said inflationary index shall be that as defined by the U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index for all Urban Consumers in the Minneapolis, St. Paul metropolitan area. (Ref. Ord. 592, 1102 and 11/7/00 Amendment) Nothing in this provision shall be construed to impair any general obligation the City may have in support of otherwise lawful indebtedness or similar obligation supported by the full faith and credit of the City, provided, however, that long-term, general obligation indebtedness shall not be used for the purpose of funding the routine and daily business operations of the City. (Ref Ord 1152) 2. The City Council may also levy a tax against real and personal property within the City in addition to said limit as defined in paragraph 1 provided the Council shall: A. Adopt a resolution declaring the necessity for an additional tax levy and specifying the purposes for which such additional tax levy is required. B. Hold a public hearing pursuant to three (3) weeks' published notice in the official newspaper of the City setting forth the contents of the resolution described in Subdivision A. C. Adopt after such public hearing a resolution by an affirmative vote of a least four(4) members of the Council which shall be presented as a clear and concise 'plain language' ballot question at the next regular municipal election. (Ref. Ord. 592, 1102 and 11/7/00 Amendment) D. The additional tax levy shall take effect if 51% of the votes cast at said election are in favor of its adoption. 12-20-07 Fridley City Charter Chapter 7 Section 7.03 3. Any other fees created, or increased beyond the limits set forth in subsection 1, shall require voter approval as stipulated in subsection 2. /• ■ A. For the purposes of this subsection, "fees" includes sales and use taxes, recycling fees, gas and electric franchise fees and any other fee that produces a tax burden or direct fmancial obligation for all property owners and/or residents of Fridley. (Ref Ord 1152, 1244) B. For the purposes of this subsection,the term "fees" does not include: utility charges, Parks and Recreation Department participation fees, charges for photo-copying, sales of municipal liquor store products,or civil and criminal fines and other charges collected in cases of restitution or violation of law or contract. The term "fees" also does not include rental housing fees,building permit fees, liquor license fees,the extension or transfer of cable television service authority to additional service providers for which fees are already being charged,fees for the operation of junk yards,annual license fees for the operation of pawn shops and other regulated business, and any other charge for services,including health and safety related Code enforcement,and other goods, services or materials routinely provided by the City to its citizens or other members of the public which,by law,must be limited to the actual cost of the service being provided. The term "fees" shall not include any special assessments made under Minnesota Statutes Section 429. (Ref Ord 1152, 1244) •-■ C. For the purposes of this subsection, "fee increase" includes a new tax or fee,a monetary increase in an existing tax or fee,a tax or fee rate increase,an expansion in the legal definition of a tax or fee base, and an extension of an expiring tax or fee. (Ref Ord 1152) D. For the purposes of this subsection, "city" includes the city itself and all its departments and agencies that are organized to exercise the "Powers of the City" as defined in Chapter 1 of this Charter. "City" shall not include any body of government owing its existence to separate constitutional or statutory authority outside of the Charter,regardless of whether that other body of government has jurisdiction or performs duties and services within the boundaries of the City. (Ref Ord 1152) E. For the purpose of addressing natural disasters this subsection does not apply to any specific emergency measure authorized in Chapter 7, Section .08 (7.08). (Ref 11/7/00 Amendment) Section 7.03. BOARD OF REVIEW. The Council shall constitute a board of review and shall meet as such in the usual place for holding Council meetings to equalize the assessed valuations according to law, and a published notice of such meeting shall be given in the official newspaper of the City at least ten (10) days prior to the day of said meeting. (Ref. Special Election 4/12/60, Ord. 592) 12-20-07 • Fridley City Charter Chapter 7 Section 7.05 �., Section 7.04. PREPARATION OF ANNUAL BUDGET. 1. The City Manager shall prepare the estimates for the annual budget which shall include any estimated deficit for the current year. The estimates of expenditures shall be submitted by each department to the City Manager. Each estimate shall be divided into three (3) major subdivisions as follows: (a) Salaries and Wages, (b) Ordinary Expenses, (c) Capital Outlay. Salary detail shall show a list of all salaried officers and positions with salary allowance and number of persons holding each. Wages shall be broken down in sufficient detail to justify the request. Ordinary expenses shall be broken down into such detail as the City Manager shall direct. Capital Outlay shall be itemized as to items and amounts. (Ref. Ord. 625) 2. In parallel columns shall be added the amounts expended under similar headings for the two (2) preceding fiscal years, and, as far as practicable, the amounts expended and estimated for expenditure during the current year. In addition to estimates of expenditures, the City Manager shall prepare a detailed statement of revenues collected for the two (2) preceding completed fiscal years with amounts estimated to be collected for the current fiscal year, and an estimate of revenues for the ensuing fiscal year. The estimates shall be submitted o the Council at its last regular monthly meeting in August and shall be published twice in summary in the official Publication prior to November 15. (Ref. Ord. 625, Ord. 946) Section 7.05. PASSAGE OF THE BUDGET. The budget shall be a principal item of business at the last regular monthly meeting of the Council in August, and the Council shall hold subsequent meetings from time to time until all the estimates have been considered. The meetings shall be so conducted as to give interested citizens a reasonable amount of time in which to be heard, and an opportunity to ask questions. The budget estimates shall be read in full and the City Manager shall explain the various items thereof as fully as may be deemed necessary by the Council. The annual budget finally agreed upon shall set forth in such detail as may be determined by the City Council, the complete financial plan of the City for the ensuing fiscal year, and shall be signed by the majority of the Councijpon being adopted. It shall indicate the sums to be raised and from what sources, and the sum- s to be spent and for what purposes, according to the plan indicated in Section 7.04. The total sum appropriated shall not exceed the total estimated revenue. The Council shall adopt the budget by resolution in accordance with State Law. The resolution shall set forth the total of the budget and the totals of the major divisions of the budget, according to the plan indicated in Section 7.04. The budget resolution as adopted shall be published in the official publication. (Ref. Ord. 625, Ord. 946) 12-20-07 Fridley City Charter Chapter 7 Section 7.09 Section 7.06. ENFORCEMENT OF THE BUDGET. n It shall be the duty of the City Manager to enforce strictly the provisions of the budget. The City Manager shall not approve any order upon the City Treasurer for any expenditure unless an appropriation has been made in the budget, nor for any expenditure covered by the budget unless there is sufficient unencumbered balance left after deducting the total past expenditures and the sum of all outstanding orders and encumbrances. No officer or employee of the City shall place any orders or make any purchases except for the purposes and to the amounts authorized in the budget. Any obligation incurred by any person in the employ of the City for any purpose not authorized in the budget or for any amount in excess of the amount therein authorized shall be a personal obligation upon the person incurring the expenditure. (Ref. Ord. 857) Section 7.07. ALTERATIONS IN THE BUDGET. After the budget shall have been duly adopted, the Council shall not have power to increase the amounts therein fixed, whether by the insertion of new items or otherwise, beyond the estimated revenues, unless the actual receipts shall exceed such estimates, and in that event, not beyond such actual receipts. The sums fixed in the budget shall be and become appropriated at the beginning of the fiscal year for the several purposes named therein, and no other. The Council may at any time, by resolution passed by a vote of at least four (4) members of the Council, reduce salaries or the sums appropriated for any purpose by the budget, or by vote of at least four (4) members of the Council authorize the transfer of sums from the unexpended balances of the budget to other purposes. (Ref. Ord. 946) Section 7.08. EMERGENCY APPROPRIATION IN THE BUDGET. 1. The Council shall have power to establish an emergency appropriation as a part of the budget, but not to exceed ten percent (10%) of the total budget. Transfers from the emergency appropriation to any other appropriation shall be made only by a vote of at least four(4)members of the Council. 2. The sums transferred to the several departments or divisions shall be considered as a part of such appropriations and shall be used only for the purposes designated by the Council. Section 7.09. LEVY AND COLLECTION OF TAXES. In accordance with Minnesota State Law,the Council shall levy by resolution the taxes necessary to meet the requirements of the budget for the ensuing fiscal year. The City Clerk shall transmit to the county auditor annually, not later than the date required by Minnesota Law, a statement of all the taxes levied, and such taxes shall be collected and the payment thereof be enforced with and in like manner as state and county taxes. No tax shall be invalid by reason of any informality in the manner of levying the same, nor because the amount levied shall exceed the amount required to be raised for the special purpose for which the same is levied, but in that case the surplus shall go into a suspense fund, and shall be used to reduce the levy for the ensuing year. (Ref Ord. 625, Ord. 946) 12-20-07 Fridley City Charter Chapter 7 Section 7.12.0 Section 7.10. TAX SETTLEMENT WITH COUNTY. The City Treasurer shall see to it that all moneys in the county treasury belonging to the City are promptly turned over to the City according to law. Section 7.11. DISBURSEMENTS,HOW MADE. All disbursements shall be made only upon the order of the City Manager and City Clerk, duly authorized by a resolution or motion of the Council, and every such order shall specify the purpose for which the disbursement is made, and indicate the fund out of which it is to be paid. Each such order shall be directed to the Treasurer, and the latter shall issue a check payable to the order of the person in whose favor the order was drawn. The Treasurer shall issue no check upon any City funds except upon such order. In the discretion of the Council the order and check may be a single instrument. No claim against the City shall be allowed unless accompanied by either an itemized bill, or a payroll, or time sheet, each of which shall be approved and signed by the responsible City officer who vouches for the correctness and reasonableness thereof. The Council may by ordinance make additional regulations for the safekeeping and disbursement of the City's funds. The Council may by resolution or motion provide for the regular payment without specific individual authorization by the Council of salaries and wages of regular employees, laborers,and fixed charges which have been previously duly and regularly incurred. Section 7.12. FUNDS TO BE KEPT. There shall be maintained in the City Treasury the following funds: A. A general fund for the payment of such expenses of the City as the Council may deem proper. Into this fund shall be paid all money not provided herein or by statute to be paid into any other fund. B. A debt service fund, into which shall be paid all receipts from taxes or other sources for the payment of principal and interest of all obligations issued by the City except bonds issued on account of any local improvement to be financed wholly or partly by special assessments and bonds issued on account of any municipally owned utility. Out of this fund shall be paid the principal and interest of such obligations when due. Any surplus in such fund not needed immediately for debt service may be invested under the direction of the Council in such securities as are authorized by statute for the investment of such funds and such investments may be liquidated at any time. C. A bond fund, into which shall be paid and disbursed the proceeds of all bonds issued by the City except bonds issued on account of any local improvement to be financed wholly or partly by special assessments and bonds issued on account of any municipally owned utility. A separate bond account shall be kept for each issue of such bonds. 12-20-07 Fridley City Charter Chapter 7 Section 7.12.F D. A special assessment fund, which shall be used to finance local improvements that n. are to be paid for, in whole or in part, from special assessments against benefited property. There shall be paid into this fund: (1) collections of special assessments, with interest, levied against benefited property; (2) proceeds of bonds or certificates of indebtedness sold by the City in anticipation of assessment collections and the proceeds of interfund loans; (3) amounts from other City funds representing either (a) apportionments of costs against the City at large, (b) benefit assessments against City property, or(c) appropriations to maintain the integrity of the fund. There shall be paid out of this fund: (1) all expenses and costs of the improvement projects that are fmanced through the fund; (2) the redemption of all special assessment fund bonds and certificates of indebtedness, with interest, at or before maturity, and any interfund loans; (3) transfers to the general fund of any unencumbered surplus of the fund, in the discretion of the Council; and (4) abatements of assessments and refunds of receipts in error. The Council shall maintain the integrity of this fund by appropriations from tax funds if necessary, and in addition may by ordinance create and maintain in the fund a cash reserve sufficient for working capital purposes. In order to anticipate the collection of special assessments the Council may by a majority vote issue and sell bonds and certificates of indebtedness, pledging the full faith and credit of the City, or pledging only special assessments, in such amounts and maturities as it may determine, regardless of the provisions of Section 7.16 of this Chapter; provided that the aggregate amount of such bonds and certificates outstanding at any time shall not exceed the sum of the following; n (1) all assessments levied and uncollected; (2) assessable cost of work in progress; and (3) the cash reserve for working capital as previously determined by ordinance. In order that the fund may be administered on a self-sustaining basis, all improvement projects fmanced through it shall upon completion be certified by the City Manager as to total cost, which shall thereupon be apportioned by the Council either as assessments against benefited property or as amounts due from other City funds. Amounts apportioned against other City funds shall be due not later than the dates of adoption of the corresponding assessment rolls, shall be charged interest as in the case of assessments and shall be paid into the fund,with any interest due,not later than one (1)year after the due dates. E. A public utility fund into which shall be paid all money derived from the sale of bonds issued on account of any municipally owned utility and all money derived from the sale of utility services, and from the sale of any property acquired for or used in connection with any such utility. There shall be paid out of this fund the cost of the purchase, construction, operation, maintenance and repair of such utility, including the principal of and interest upon obligations which have been or shall be issued on its account. Separate accounts within the public utility fund shall be kept for all utilities which are operated separately. F. In addition to the foregoing funds, there may be maintained in the City Treasury, .. whenever the Council deems it advisable,the following funds: 12-20-07 Fridley City Charter Chapter 7 Section 7.14 1. A working capital or revolving fund, for financing self-sustaining activities not accounted for through other funds. 2. A trust and agency fund, for the care and disbursement of money received and held by the City as trustee or custodian or in the capacity of an agent for individuals or other governmental units. 3. Such other funds as may be required by statute or ordinance. In lieu of establishing any of the three(3)foregoing types of funds, Subsections 1,2, Y and 3,the Council may provide for the recording of operations or activities IN,f\- for which the use of such funds night be suitable through the maintenance of separate accounts in any appropriate fund already established. The Council shall have full power to make by duly adopted ordinance such interfund loans,except from funds held under Subsection 2 hereof,as it may deem necessary and appropriate from time to time. Section 7.13. RECEIPTS TO GO TO CITY TREASURER. All receipts of money belonging to the City, or any branch thereof, excepting only those funds collected by the County Treasurer, shall be paid to the City Treasurer by the person authorized to receive the same. All such moneys, and also all moneys received upon tax settlements from the County Treasurer, shall be deposited as soon as possible in a bank or banks approved by the City Council, subject to state laws regulating the designation of depositories for municipal funds. Section 7.14. ACCOUNTS AND REPORTS. The City Manager shall be the Chief Accounting Officer of the City and of every branch thereof, and the Council may prescribe and enforce proper accounting methods, forms, blanks, and other devices consistent with the law, this Charter and the ordinances in accord with it. The City Manager shall submit to the Council a statement each month showing the amount of money in the custody of the City Treasurer,the status of all funds,the amount spent or chargeable against each of the annual budget allowances and the balances left in each and such other information relative to the finances of the City as the Council may require. The Council may at any time and shall annually provide for an audit of the City finances by a certified public accountant or by the department of the State authorized to make examination of the affairs of municipalities. On or before the first day of April in each year the City Manager shall prepare a complete financial statement in form approved by the Council of the City's financial operations for the preceding calendar year, and quarter, which statement may be published in such manner as the Council may direct and a summary thereof shall be published in the official newspaper on or before the third week in April,July, October and January as appropriate. (Ref. Ord. 625, Ord. 857) 12-20-07 Fridley City Charter Chapter 7 Section 7.15.2 Section 7.15. BONDED DEBT AND DEBT LIMIT. 1. In addition to all the powers in respect to borrowing and the issuance of bonds and other obligations for the payment of money specifically or impliedly granted by this Charter, and any amendments thereto, the City shall have all the powers in reference to these subject matters granted to cities of its same class by the laws of the State of Minnesota in force from time to time. The City shall have the power to issue and sell its bonds to the State of c . ` Minnesota and to comply with all provisions of law relative to loans to municipalities from :ii /! the permanent State funds. The City shall also have such powers as are necessary to obtain loans or funds from the Government of the United States and any of its instrumentalities or from the State of Minnesota or any of its instrumentalities, and to comply with all provisions of law relative to obtaining such loans or funds. 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. By the proceedings for the issuance of any bonds, by the terms of the bonds and by agreements with the purchasers of bonds, they may be made special in character and limited in their payment to earnings or to part earnings and part tax funds. To the extent that they are thus p able out of earnings or other than tax funds, such bonds shall not be paid out of taxes./The total bonded debt of the City at the time of the issuance of any bonds shall not exceed ten percent (10%) of the last assessed valuation of the taxable property therein, or the limit authorized by State law for cities of the same class, whichever is the greater, but in computing the total • bonded debt, certificates of indebtedness, bonds,warrants or other obligations issued before • ) / or after adoption of this Charter shall not be included or counted if(1)held in a sinking fund maintained by the City; or(2) issued for the acquisition, equipment, purchase, construction, maintenance, extension, enlargement or improvement of street railways, telegraph or \� telephone lines, water, lighting, heat and power plants, or either, or any`other public "� convenience from which a revenue is or may be derived, owned and operated by the City, or Si the acquisition of property needed in connection therewith, or for the construction of public drainage ditches, storm and sanitary sewers, or for the acquisition of lands for streets,parks, or other public improvements or for the improvement thereof, to the extent that they are payable from the proceeds of assessments levied upon property especially benefited by such improvements; or (3) issued for the creation of maintenance of a permanent improvement revolving fund; or (4) for the purpose of anticipating the collection of general taxes for the year in which issued. (Ref. Ord. 857) 12-20-07 Fridley City Charter Chapter 7 Section 7.18 Section 7.16. FORM AND REPAYMENT OF BONDS. No bonds shall be issued to run for longer than the reasonable life expectancy of the property or improvement for which the bonds are authorized, as ascertained and set forth in the resolution authorizing such bonds, and in no case shall bonds be issued to run for more than thirty (30)years. The purposes for which bonds are authorized shall be set forth in the resolution authorizing them and the proceeds from such bonds shall not be diverted to any other purpose. It shall be the duty of the City Manager to include in the budget estimates each year a sum or sums amply sufficient to pay the principal of, and the interest on, any bonds which are to fall due in the coming fiscal year, and another sum sufficient to pay the interest for the same year on the Bonds which will be still outstanding. It shall be the duty of the Council, enforceable by m upon the suit of any bondholder or taxpayer, to include such sum or sums as may be n `essary for this purpose in the annual budget which it passes. (Ref. Ord. 857) Section 7.17. DEBT AND TAX ANTICIPATION CERTIFICATES. 1. 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 authorize the sale by the City Treasurer of emergency debt certificates to run not to exceed eighteen (18)months and to bear interest at not more than allowable by State Statutes. A tax sufficient to redeem all such certificates at maturity shall be levied as part of the budget of the following year. The authorization of an issue of such emergency debt certificates shall take the form of an ordinance approved by at least four (4) of the members of the Council; the ordinance may, if deemed necessary, be passed as an emergency ordinance. (Ref. Ord. 592) 2. For the purpose of providing necessary moneys to meet authorized expenditures, the Council may issue certificates of indebtedness in any year prior to the receipt of taxes payable in such year, on such terms and conditions as it may determine,bearing interest at a rate not more than allowable by State Statutes; provided that such certificates outstanding at any one time shall not exceed forty percent(40%)of the tax levy payable in the current year belonging to the fund for the benefit of which the borrowing is authorized. (Ref. Ord. 592) Section 7.18. BONDS OUTSIDE THE DEBT LIMIT. Without limit as to amount, the Council may issue bonds for legal purposes outside of the debt limit: (a) for the creation and maintenance of a permanent improvement revolving fund, (b) for extending, enlarging, or improving water supply system, lighting and heat and power plants, or either, or other revenue-producing public utilities of whatever nature, owned and operated by the City, or of acquiring property needed in connection therewith, (c) for public improvements payable from special assessments. 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AN ORDINANCE AMENDING SECTION 7.02 OF THE FRIDLEY CITY CHARTER WHEREAS,the City of Fridley,Minnesota,under the powers vested in it under Minnesota Statutes >' Section 410 and its own City Charter,has the power to amend its Charter,and WHEREAS,after review and consent of the Charter Commission,the City Council has determined the current language of the charter related to restrictions on the tax levy and fee restrictions may cause deep and significant harm to the finances of the City and that a change in charter language is necessary to mitigate future harm from being caused by the charter,to the City's finances. IT IS HEREBY ORDAINED THAT THE CHARTER BE AMENDED AS FOLLOWS: FRIDLEY CITY CHARTER CHAPTER 7. TAXATION AND FINANCES. Section 7.02. POWER OF TAXATION. 1. The City shall have,in addition to the powers by this Charter expressly er-inipliedly granted or implied,all the powers to raise money.b taxataion pursuant to the laws of the State which are applicable to cities of the class of which it may be a member from time to time, f provided that the amount of taxes levied against teals.and personal property within the City for general City purposes shall not exceed in dollars,a tax levy that is greater than the prior year tax levy increased by an inflationary indexr -b as defined by the U.S. bepartment of Labor, Bureau of Labor Statistics, Consumer Price Index for all Urban Consumers in the Minneapolis, St. Paul metropolitan area. Nothing in this provision shall be construed to impair any general obligation the City may have in support of otherwise lawful indebtedness or similar obligation supported by the full faith and credit of the City, ''provided, however, that long-term, general obligation indebtedness shall not be used for the purpose of funding the routine and daily business operations of the City. '(Ref Ord 1152) 2. The City Council may also levy a tax year against real and personal property within the City in addition to said limit as defined in paragraph 1 provided the Council shall: A. Adopt a resolution declaring the necessity for an additional tax levy and specifying the purposes for which such additional tax levy is required. B. Hold a public hearing pursuant to three (3) weeks' published notice in the official newspaper of the City setting forth the contents of the resolution described in Subdivision A. C. Adopt after such public hearing a resolution by an affirmative vote of a least four(4) e Ordinance No.` Page 2 members of the Council which resolution provides for such levy. shy-be-pfesented � - •._. • ) 3. Creation of any new fees shall require voter approval as stipulated in this subsection. Any A. For the purposes of this subsection,new"fees"includes sales and use taxes, rues,gas and electric franchise fees and any other fee that produces a tax burden or direct financial obligation for all property owners and/or residents of Fridley. (Ref Ord 1152) 1/ `" - .n • 429 1U /1'd_1 52) -( of B.n—For the purposes of this subsection, "city" includes the city itself and all its departments and agencies that are organized to exercise the"Powers of the City"as defined in Chapter 1 of this Charter. "City" shall not include any body of government owing its existence to separate constitutional or statutory authority outside of the Charter,regardless of whether that other body of government has jurisdiction or performs duties and services within the boundaries of the City. (Ref Ord 1152) C. To create a new fee,the City Council shall: 2 Ordinance No._ Page 3 1) Adopt a resolution declaring the need for establishing a new fee and the purposes for which the new feet required. 2) Hold a public heart 'pursuant to three(3)weeks notice published in the official newspaper of the City,setting forth the contents of the titian to establish the new fee. 3) After such public hearing,adopt a resolution by an armative vote of at least four(4)members of the Council which all be presented as a.clear and concise`plain language"ballot question at the next re. ular municipal election. 4) The new fee shall take effect if approved by a majority of the votes cast on that ballot question. 4. For the purpose of addressing natural disasters this subsection does not apply to any specific emergency measure authorized in Chapter 7,Section.08(7.08). PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS DAY OF ,2009. Scott J.Lund,Mayor ATTEST: Debra A. Skogen,city Clerk Public Hearing: First Reading: Second Reading: Publication:, 3 Amendment(C)(2) (Holm Amendment) AS AMENDED • W/0 Ordinance No. AN ORDINANCE AMENDING SECTION 7.02 OF THE FRIDLEY CITY CHARTER WHEREAS,the City of Fridley,Minnesota,under the powers vested in it under Minnesota Statutes Section 410 and its own City Charter,has the power to amend its Charter,and WHEREAS, after review and consent of the Charter Commission, the City Council has determined the current language of the charter related to restrictions on the tax levy and fee restrictions may cause deep and significant harm to the finances of the City and that a change in charter language is necessary to mitigate future harm from being caused by the charter to the City's finances. IT IS HEREBY ORDAINED THAT THE CHARTER BE AMENDED AS FOLLOWS: FRIDLEY CITY CHARTER CHAPTER 7. TAXATION AND FINANCES. Section 7.02. POWER OF TAXATION. 1. The City shall have, in addition to the powers by this Charter expressly granted or implied, 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 from time to time, provided that the amount of taxes levied against real and personal property within the City for general City purposes shall not exceed in dollars, a tax levy that is greater than the prior year tax levy increased by an inflationary index-as defined by the U.S. Department of Labor,Bureau of Labor Statistics, Consumer Price Index for all Urban Consumers in the Minneapolis, St. Paul metropolitan area. Nothing in this provision shall be construed to impair any general obligation the City may have in support of otherwise lawful indebtedness or similar obligation supported by the full faith and credit of the City, provided, however, that long-term, general obligation indebtedness shall not be used for the purpose of funding the routine and daily business operations of the City. (Ref Ord 1152) 2. The City Council may also levy a tax icy year against real and personal property within the City in addition to said limit as defined in paragraph 1 provided the Council shall: A. Adopt a resolution declaring the necessity for an additional tax levy and specifying the purposes for which such additional tax levy is required. B. Hold a public hearing pursuant to three (3) weeks' published notice in the official newspaper of the City setting forth the contents of the resolution described in Subdivision A. C. Adopt after such public hearing a resolution by an affirmative vote of a least four(4) members of the Council which resolution provides for such levy. Ordinance No._ Page 2 3. Creation of any new fees shall require voter approval as stipulated in this subsection. A. For the purposes of this subsection,new"fees" includes sales and use taxes,gas and electric franchise fees and any other fee that produces a tax burden or direct financial obligation for all property owners and/or residents of Fridley. (Ref Ord 1152) B. For the purposes of this subsection, "city" includes the city itself and all its departments and agencies that are organized to exercise the"Powers of the City" as defined in Chapter 1 of this Charter. "City" shall not include any body of government owing its existence to separate constitutional or statutory authority outside of the Charter,regardless of whether that other body of government has jurisdiction or performs duties and services within the boundaries of the City. (Ref Ord 1152) C. To create a new fee,the City Council shall: a. Adopt a resolution declaring the need for establishing a new fee and the purposes for which the new fee is required. b. Hold a public hearing pursuant to three(3)weeks notice published in the official newspaper of the City, setting forth the contents of the resolution to establish the new fee. c. After such public hearing,adopt a resolution by an affirmative vote of at least /'•■ four(4)members of the Council which shall be presented as a clear and concise "plain language"ballot question at the next regular municipal election. d. The new fee shall take effect if approved by a majority of the votes cast on that ballot question. 4. For the purpose of addressing natural disasters this subsection does not apply to any specific emergency measure authorized in Chapter 7, Section.08 (7.08). PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS DAY OF ,2009. Scott J. Lund,Mayor ATTEST: Debra A. Skogen,city Clerk Public Hearing: First Reading: Second Reading: Publication: 2 o& 1 CHAPTER 7 TAXATION AND FINANCES Section 7.01 Council to Control Finances. The Council shall have full authority over the financial affairs of the City except as limited or prohibited by the state constitution, state laws, or this Charter. It shall provide for the collection of all revenues and other assets,and the auditing and settlement of accounts. It shall further provide for the safekeeping and disbursements of public monies by the City Treasurer. Section 7.02 Fiscal Year. The fiscal year of the City shall be the calendar year. Section 7.03 System of Taxation. Subject to the state constitution, and except as forbidden by it or by state law, the Council shall have full power to provide by ordinance for a system of local taxation. This authority includes the power by ordinance to assess, levy, and collect taxes on all subjects or objects of taxation except as limited or prohibited by the state constitution, by this Charter or by state laws imposing restrictions upon the City irrespective of Charter provisions. Subdivision 1. The City's annual resolution to levy ad valorem taxes (raising money against real and personal property) shall not exceed the lesser of the following formulas; either the prior year tax levy dollar amount increased by a maximum of 5%, or CPI (Consumer Price Index) plus 2%. The CPI shall be the 12 month average of the most recently published data for all Urban Consumers in the Minneapolis, St. Paul metropolitan area, as defined by the U.S. Department of Labor,Bureau of Labor Statistics. Subdivision 2. The City Council may levy a tax against real and personal property in excess of the limit set in Subdivision 1 provided the Council shall: A) Adopt a resolution declaring the necessity for a n additional tax levy and specifying the purposes for which such additional tax levy is required. B) Hold a public hearing upon at least 10 days posted and published notice in the City's official newspaper, City newsletter, and, if available, the City web site, setting forth the contents of the resolution described in Subdivision 2A. C) After such public hearing, adopt by an affirmative vote of at least four(4)members of the Council such resolution language which is readily understandable and a summary of such resolution will be the ballot question for the electorate at the next regular municipal election or special election, per this Charter's Section 4.04, as amended, prior to the final levy approval. D) If the additional tax levy resolution is then approved by the voters under Chapter 4 of this Charter then the levy shall be implemented in the following fiscal year or later date as specified in the resolution. 17 Subdivision 3. Any other fee or levy, created, or increased beyond the limits set forth in Subdivision 1, shall require voter approval as stipulated in Subdivision 2 of this Section. a) For the purposes of this Section, "fee" includes utility charges (other than water, sanitary sewer, storm water and street light), recycling fees, franchise fees (for cable, gas and electric),Administrative offense fees, and shall also include any other fee that produces a tax burden or direct financial obligation to a simple majority of property owners and/or residents of Mounds View. b) For the purposes of this Section,the term "fee" does not include: Filing for Office fee, park or recreational participation fees, charges for photo-copying, sales of municipal liquor store products, Building and Zoning Permit or Inspection and Planning fees, or civil, criminal and banking fines and other charges collected in cases of restitution or violation of law or contract. The term "fee" does not include charges collected by the direction of the State, County or other taxation authority, or as a result of joint powers agreements. The term "fee" also does not include rental housing fees, liquor license fees, cable television service fees, annual license fees for the operation of a regulated business, and any miscellaneous fees for services, including health and safety related Code enforcement, and other goods, services or materials routinely provided by the City to its citizens or other members of the public which, by law, must be limited to the actual cost of the service being provided. The term "fee" shall not include any special assessments made under Minnesota Statutes Section 429, as amended. c) For the purposes of this Section, "fee increase" includes a new tax or fee, a monetary increase in an existing tax or fee, a tax or fee rate increase, an expansion in the legal definition of a tax or fee base, and an extension of an expiring tax or fee. d) This Section does not apply to any specific emergency measure authorized in Chapter 7 Section 7.12. or MN Statute 475.754, as amended. Subdivision 4. The City shall not levy to increase any fund reserve beyond 50% of an average of that fund's previous five years annual expenditures. The Council may raise a fund's reserve beyond 50%provided: a) the Council designates by resolution and holds a public hearing reviewing the purpose of the reserve increase and the City follows such proposed increase with the steps outlined in Subdivision 2 of this Section the year prior to the collection of such increased taxation or fee, or b). the Council modifies and adopts by resolution the Five Year Financial Plan, as defined in Chapter 7, Section 7.05, as amended, specifying the fund reserve purpose and the City follows such proposed increase with the steps outlined in Subdivision 2 of this Section the year prior to the collection of such increased taxation or fee. Moneys raised by Tax Increment Financing shall not be included in the calculation of reserve limit. This Subdivision and Section shall not limit or impair the City's ability to create Tax Increment Financing or enter into Development Agreements specified by MN Statutes 469.174 18 to 469.1799, as amended. This Subdivision shall not require the City to divest or expend any excess of any reserve fund(s) currently exceeding the specified limit, provided the Council, within 90 days of adopting this Section, designates by resolution the purpose of the reserve or adopts a modified Five Year Financial Plan reflecting the reserve purpose. Subdivision 5.Nothing in this Section shall be construed to impair any general obligation the City may have in support of otherwise lawful indebtedness or similar obligation supported by the full faith and credit of the City, provided, however, that long-term, general obligation indebtedness shall not be used for the purpose of funding the routine and daily business operations of the City. (Section 7.03 Amended by Referendum Election, November 2006) Section 7.04 Submission of Budget. Subdivision 1. Annually, on or before the 15t calendar day of September of each year or as specified by MN Statute 275.065, as amended, the Clerk-Administrator shall submit to the Council the budget estimates for funds levying property taxes for the ensuing fiscal year and an accompanying summary message in accordance with a budget calendar to be established by resolution. The total proposed operating budget to be provided from the property tax shall not exceed the amounts authorized by state law and this Charter. Consistent with these provisions, the budget shall contain such information and be in the form prescribed by the City Council. The final budget shall provide a complete financial plan for all City funds and activities for the ensuing fiscal year and except as required by state law or this Charter,shall be in such form as the Council may require. It shall include a summary and show in detail all estimated income and all proposed expenditures, including debt service and comparative figures for the current fiscal year, actual and estimated, and the preceding year. In addition to showing proposed expenditures for current operations, it shall show proposed capital expenditures to be made during the year and the proposed method of financing each such capital expenditure. Subdivision 2. For each enterprise operated by the City, its proposed and final budgets shall show income, expenditure, and anticipated net surplus or deficit with the proposed disposition method. Subdivision 3. The Clerk-Administrator's message shall explain the budget, both in fiscal terms and in terms of the work programs, linking programs to goals of the City and community priorities. It shall outline the proposed financial policies and programs of the City for the ensuing fiscal year and the impact of those policies and programs compared to the City's current five-year plan, as adopted by the City Council. It shall describe the important features of the budget, indicate any major changes in financial policies, expenditures, and revenues together with the reasons for such changes. It shall summarize the City's debt position for each fund, including factors affecting the ability to raise resources through debt issues, and include such other material as the Clerk-Administrator deems desirable or as requested by the City Council 19 Subdivision 4. Budget Planning Guideline. The purpose of this section is to provide the public with a general time table for the annual budget process. The dates are guidelines and subject to change by the City Council and MN Statute 275.065, as amended. Activity Estimated Time Period Five-Year Plan: Development Jan. 1 to May 1 Five-Year Plan: Public Review May 1 to May 20 Five-Year Plan: Council Approval May 20 to June 1 Annual Budget Calendar: Adopted by Council June 1 Five-Year Plan: Published to Public June 1 to Aug. 1 Annual Budget: Public Input to Department June 1 to Sept 1 Annual Budget: Clerk-Administrator Develops Summary and Estimate Proposal for Council Aug. 1 to Sept. 15 Annual Budget: Estimates Submitted to Council Sept. 15 Annual Budget: Proposal and Tax Levy Estimates Council Adoption Sept. 15 Annual Budget: Council Review and Amend Sept. 15 to Nov 23 Annual Budget and Tax Levy: Proposal Published to Public Sept. 15 to Dec. 1 Annual Budget and Tax Levy: Public Review Sept. 15 to Dec. 20 Annual Budget:Public Hearing Advertised Nov. Annual Budget and Tax Levy: Initial Public Hearing Nov. 29 to Dec. 20 Annual Budget and Tax Levy: Council Adoption Dec. 5 to Dec. 20 Annual Budget and Tax Levy: Final Council Budget Summary Published to Public Dec. 20 to Feb. 1 • 20 Section 7.05 Five-Year Financial Plan. Subdivision 1. The City Council shall have prepared a five-year financial plan commencing with the ensuing calendar year. The City Council shall hold a public hearing on the five-year financial plan and adopt it by ordinance,with or without amendment, by June 1st of each year. The financial plan shall consist of at least the following three elements as specified in subdivisions 2-4 which follow: Subdivision 2. The Capital Improvement Program shall contain a list of all capital improvements proposed to be undertaken during the next five fiscal years, with appropriate supporting information as to the necessity for such improvements; cost estimate, method of financing and recommended time schedule for each such improvement; and the estimated annual cost of operating and maintaining the facilities to be constructed or acquired. This information shall be revised and extended each year for capital improvements still pending or in process. Subdivision 3.A Five-Year Revenue and Expense Estimate shall contain a tentative revenue policy that describes five-year plans for fmancing public services and capital improvements. It shall measure the objectives and needs for each City department,the standard of services desired,and the impact of each such service on the annual operating budget. Subdivision 4. The Capital Budget shall be a summary on the basis of a five-year period of the capital or money requirements for the above described programs. It shall list a priority for each anticipated investment in community facilities and balance this with a consideration of the availability of necessary revenues. Subdivision 5. A summary of the five year fmancial plan shall be published before August 1s1 each year in the official City newspaper,the City newsletter,and, if available,the City web site. Section 7.06. Council Action on Budget. Subdivision 1. The Council shall annually adopt a budget calendar by June 1st. The calendar will establish the time line for development and submission of the budget and allow for public review and comment in accordance with this Charter, the City Council, and MN Statute 275.065, as amended. The budget shall be considered at the first regular monthly meeting of the Council in September and at subsequent meetings until a budget is adopted for the ensuing year. The budget calendar will provide a 30-day period for public review and input to the annual budget prior to final approval by the City Council. The meetings shall be so conducted as to give interested citizens a reasonable opportunity to be heard. The Council may revise the proposed budget but no amendment to the budget shall increase the authorized expenditures to an amount greater than the sum of estimated income and reserves. The Council shall adopt the budget by a resolution that shall set forth the total for each budgeted fund and each department.The budget shall indicate the sums to be raised and from what sources and the sums to be spent and for what purpose as the Council deems necessary for establishing the budget. The Council shall also adopt a resolution levying the amount of taxes provided in the budget, and the Clerk-Administrator shall certify the tax resolution to the County Auditor in accordance with state law. Adoption of the budget resolution shall constitute appropriations at the beginning of the fiscal year of the sums fixed in the resolution of the several purposes named. 21 Subdivision 2. As specified by MN Statute 275.065, as amended, before the budget is adopted for the ensuing fiscal year, a public hearing notice and summary of the proposed budget will be published in the official City newspaper, the City Newsletter, and, if available, the City web site. Such summary should be readily understandable by the layperson, and should provide appropriate supporting information as to the necessity for any increase in the budget over the total for the current fiscal year.Failure to provide the specified summary will not invalidate the budget. The final budget will be published in accordance with Minnesota Statutes on Truth in Taxation or no later than 60 days after adoption by the Council in the official City newspaper, the City newsletter and, if available,the City web site. Subdivision 3. If the Council fails to adopt the budget by the beginning of the next fiscal year, the preceding months fiscal year budget shall go into effect for up to thirty-one(31) days or until the Council adopts a budget. Section 7.07. Enforcement of the Budget. The Clerk-Administrator may designate department heads or other staff who may assist with each fund or department in the annual budget. It shall be the duty of the Clerk-Administrator to strictly enforce the detail provisions of the budget. The City Council shall strictly enforce the provisions of the budget. The City Council shall not authorize any payment or the incurring of any obligation by the City, unless an appropriation has been made in the budget resolution, and there is a sufficient unexpended balance after deducting the total past expenditures and encumbrances against the appropriation. No officer or employee of the City shall place any order or make any purchase unless the amount is authorized in the budget resolution and in compliance with the purchasing policies of the City as established by the City Council, the City Charter, the City Code, and Minnesota Statutes. Any obligation incurred by any person in the employ of the City for any purpose not authorized in the budget resolution, or for any amount in excess of the amount authorized, shall be a personal obligation upon the person incurring the obligation. No check shall be issued or transfer made to any account other than one owned by the City until the claim to which it relates has been supported by an itemized bill, payroll, or time sheet or other document approved and signed by the responsible City officer who vouches for its correctness and reasonableness. Section 7.08. Alterations in the Budget. After the budget resolution has been adopted, the Council may amend the budget by resolution, but shall not increase the amounts fixed in the resolution beyond the sum of estimated receipts and reserves, except to the extent that actual receipts exceed the estimate or to implement Section 7.12 herein. At any time the Council may by resolution reduce the sums appropriated for any purpose, to increase reserves or authorize the transfer of sums from unencumbered balances in the budget. Section 7.09. Funds. There shall be maintained in the City treasury a general fund and such other funds as may be required by state law, ordinance, or resolution. The Council may, by resolution or ordinance, make inter-fund loans, except from trust and agency funds, as it may deem necessary and appropriate. 22 Section 7.10. City Indebtedness. (Amended by Ordinance 782, Adopted January 8, 2007; Published January 27,2007) Subdivision 1. Except as provided in Sections 7.11 and 7.12, 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. All such obligations shall be issued and sold only with the approval of the majority of the voters voting on the question at a general or special election, except in the case of obligations for which an election is exempted by this Charter or by state law. Subdivision 2. A description of each such proposed issue shall be published in the official City newspaper, and, if available the City Newsletter and the City web site, but failure to give such description, or any defect in the description, shall not invalidate the issue. Section 7.11. 1. Anticipation Certificates. At any time after January 1, in accordance with MN Statute 412.261, as amended, with the following restrictions;the Council may issue certificates of indebtedness in anticipation of state and federal aids and the collection of taxes levied the previous year for any fund and not yet collected. The total amount of certificates issued against any fund for any year together with interest thereon until maturity shall not exceed 90%of the total state and federal aids and current taxes due to the fund and uncollected at the time of issuance. Such certificates shall be issued on such terms and conditions as the Council may determine, but they shall become due not later than August 1st of the year following their issuance. The proceeds of the tax levied and such state or federal aids as the governing body may have allocated for the fund against which tax anticipation certificates are issued,and the full faith and credit of the City shall be r1 irrevocably pledged for the redemption of the certificates. Section 7.12. Emergency Debt Certificates. If in any year the receipt from taxes, availability of reserves, or other sources should for some unforeseen cause become insufficient for the ordinary expenses of the City, or if any calamity or other public emergency necessitates the making of extraordinary expenditures, the Council may by ordinance issue, on such terms and in such manner as the Council determines, emergency debt certificates not to exceed 10%of the total City budget and to run not to exceed three years. Taxes sufficient to pay principal and interest on such certificates with the margin required by law shall be levied as required by law. The ordinance authorizing the issue of such emergency debt certificates shall state the nature of the emergency and be approved by at least three members of the Council. It may be passed as an emergency ordinance. 23