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CHM 03/23/2009 - 29983CITY 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 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 March 3, 2009, Special Charter Commission minutes as amended. Adopted 5 -18 -09 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 3rd 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 3rd 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? Adopted 5 -18 -09 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 sheriff s 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. Adopted 5 -18 -09 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 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. Adopted 5 -18 -09 CHARTER COMMISSION MEETING OF MARCH 23, 2009 PAGE 5 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 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. Adopted 5 -18 -09 CHARTER COMMISSION MEETING OF MARCH 23, 2009 Deb Skogen said the city could only provide education. PAGE 6 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 Adopted 5 -18 -09