CHA 03/06/2017
TO: Charter Commission Members
FROM: Deb Skogen, City Clerk and Staff Liaison
Date: March 2, 2017
Re: Charter Commission Meeting of March 6, 2017
Monday
This is a reminder to you that the next Charter Commission meeting will be held on ,
March 6th at 7:00 p.m. in Conference Room A on the Upper Level.
In order to ensure a quorum, please remember, the Charter Commission policy requires a
member to call or e-mail me before 10:00 a.m. Monday, March 6th, as to whether or not you
plan on attending the meeting. I will be out of the office on Monday, so please call or e-mail
Jake Foster at (763)572-3508 or jake.foster@fridleymn.gov as to your attendance.
If Jake does not have a quorum by 10:00 am, he will send out an e-mail to see if additional
members will attend. If by Noon there will not be a quorum, Jake will send out an e-mail to all
members and post a notice on the door announcing the cancellation of the meeting for those
Commissioners who did not contact me, but came to the meeting.
After the meeting in February, Commission Scholzen turned in her resignation and her position
became vacant. A letter was sent to the Chief Judge recommending the appointment of all three
candidates. All three individuals were appointed to the Charter Commission for the terms that
were vacant or expiring. Dave and Barb were reappointed to new terms. They will take their
oath prior to the Election for Officers.
The Commission has been discussing Chapter 7 pertaining to the levy restrictions. A memo has
been provided for reference. A presentation will be made by staff and an additional handout may
be provided.
The ordinance recommending amendments to Chapter 2 of the Charter has gone through the
public hearing and first reading. It is scheduled for the second reading on March 13th. After
publication the ordinance will become effective in June.
If you have any other questions or concerns, please feel free to contact Jake.
CITY OF FRIDLEY
CHARTER COMMISSION
AGENDA
MONDAY, FEBRUARY 6, 2017
7:00 P.M.
LOCATION:
FRIDLEY MUNICIPAL CENTER
CONFERENCE ROOM A UPPER LEVEL
1.CALL TO ORDER:
2.ROLL CALL:
3. APPROVAL OF AGENDA:
Motion approving the March 6, 2017 meeting agenda
4. APPROVAL OF MINUTES
Motion approving the February 6, 2017 meeting minutes
5. ADMINISTRATIVE MATTERS
A. Oath of Office for Appointments and Upcoming Expiring Terms
B. Election of Officers
C. Update on Chapter 2 Amendment
6. OLD BUSINESS
A. Discussion of Chapter 7
7. NEW BUSINESS
8. FUTURE MEETING TOPICS/COMMUNICATIONS
A. Discussion of Chapter 10 (Tabled until after current franchise negotiations completed)
9. ADJOURNMENT
Motion to adjourn the meeting
Next Regular Commission Meeting
Date: APRIL3, 2017
CITY OF FRIDLEY
CHARTER COMMISSION MEETING
FEBRUARY 6, 2017
CALL TO ORDER:
Vice Chairperson Ostwald called the Charter Commission meeting to order at 7:00 p.m.
ROLL CALL:
Members Present: Commissioners Gary Braam, Don Findell, Manuel Granroos, Cindy Soule,
David Ostwald, Barb Reiland, Avonna Starck, Lois Scholzen, Richard
Walch
Members Absent: Commissioners Rick Nelson, Ted Kranz, Zach Crandall, and Pam
Reynolds
Others Present: Deb Skogen, City Clerk/Staff Liaison
Wally Wysopal, City Manager
Scott Lund, Mayor
Jim Saefke, Councilmember Ward 1
Jake Foster, Management Analyst
Bruce Nelson, Fridley Resident and Charter Commission Applicant
Richard Johnston, Fridley Resident and Charter Commission Applicant
Valerie Rolstad, Fridley Resident and Charter Commission Applicant
APPROVAL OF AGENDA
Commissioner Braam MOVED and Commissioner Granroos seconded a motion to approve the
agenda.
UPON A VOICE VOTE, ALL VOTING AYE, VICE CHAIRPERSON OSTWALD
DECLARED THE MOTION CARRIED.
APPROVAL OF MINUTES
Commissioner Reiland suggested that on the first line of the second paragraph under the “New
Business” section on page four, the word “to” needed to be changed to “the”.
With no other changes, Commissioner Soule MOVED and Commissioner Braam seconded a
motion approving the Charter Commission meeting minutes as amended of October 3, 2016.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON REYNOLDS DECLARED
THE MOTION CARRIED.
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 2
ADMINISTRATIVE MATTERS
A.Nominating Committee
Commissioner Reiland said the Nominating Committee met after the last Commission
meeting to review candidates for the 2017-18 officers. The Nominating Committee
submitted the nominees as follows: Commissioner David Ostwald for chairperson,
Commissioner Donald Findell as vice chairperson, and Commissioner Manuel Granroos as
secretary.
Commissioner Reiland also asked Ms. Skogen if the voting would take place during the
March meeting. Ms. Skogen confirmed it would. Commissioner Reiland said each of these
nominees have volunteered and agreed to serve in their respective positions.
B.Vacancies
Ms. Skogen suggested the Commissioners look at the candidates in the order in which their
applications were received which was Bruce Nelson, Richard Johnston and Valerie Rolstad.
Commissioner Reiland asked Mr. Nelson what brought him to the attention of the
Commission. Mr. Nelson said he had a friend on the Commission and he finds the work very
interesting.
A follow-up question asked Mr. Nelson what he could bring to the Charter Commission. Mr.
Nelson said he is a good listener and communicator, gets along well with others, and is
someone who honors their commitments and works hard for them.
Ms. Skogen stated, the commission meets eight times a year on Mondays, and asked Mr.
Nelson if the meetings would be compatible with his other obligations. Mr. Nelson said the
meetings would work with his other obligations.
Commissioner Reiland asked what Mr. Johnston would bring to the Commission if
appointed. Mr. Johnston said he has developed many skills over the years, works well with
others, and is reliable.
Ms. Skogen asked if the meeting dates would work for Mr. Johnston, and he confirmed they
would.
Ms. Skogen also asked what interested him in working on the Charter Commission. Mr.
Johnston said he is looking to stay active in the community during his retirement.
Ms. Rolstad was welcomed and asked why she applied to become a member of the Charter
Commission. Ms. Rolstad said she was asked to apply by a few Charter Commissioners and
felt the Commission would be a good fit for her skills. She added she has been a long time
advocate for her children’s education and in public education. She has developed a lot of
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 3
skills serving on various committees and boards while communicating with a wide variety of
people. She added she is a long time resident of Fridley and is interested in ensuring the City
is heading in the right direction.
Ms. Skogen also asked Ms. Rolstad if the meeting schedule would work for her, and Ms.
Rolstad confirmed it would.
Commissioner Soule asked Ms. Skogen to provide the names of the Commissioners whose
terms were expiring, since there were three applicants and only two openings, in case any of
them did not want to be reappointed. Ms. Skogen said Commissioners Ostwald and
Reiland’s terms expired in February, Commissioners Findell, Soule, and Scholzen’s terms
expired in May, and Commissioner Walch’s term was expiring in October.
Commissioner Starck asked how the Commission’s size was determined. Ms. Skogen stated
the size was legislated as to a maximum of 15. Ms. Skogen said there were years in the past
when there were only nine or ten commissioners on the Commission at a time, and it was
great to see such an interest.
Mr. Nelson, Mr. Johnston, and Ms. Rolstad were asked to leave the room so the
Commissioners could discuss how best to fill the vacancies.
Commissioner Scholzen stated she was not interested in being reappointed to the commission
for her term ending in May. The third candidate who was not chosen immediately could then
be appointed to fill the vacancy created by Commissioner Scholzen.
Commissioner Granroos stated each of the candidates are qualified and viable to serve on the
Commission. Commissioner Reiland said the commissioners then needed to discuss and
determine who would be appointed right away to fill the immediate vacancies and who
would be appointed to the term expiring in May.
Commissioner Starck suggested the Commissioners seek to provide gender equity in their
decision to fill the initial vacancies.
Commissioner Braam asked who the first applicants were and recommended the
Commissioners chose the first two applicants to fill the immediate vacancies. He said the
third applicant can then be appointed to the vacancy that will be created by the departing
Commissioner Scholzen.
General discussion took place on these suggestions, as well as other representation equity in
the charter (including the ward in which each member is a resident), and it was determined
the best way to proceed was to do a secret ballot where each of the commissioners could vote
for the two candidates that they would like to fill the immediate two vacancies.
Commissioner Findell MOVED and Commissioner Soule seconded a motion to proceed with
a secret ballot voting to fill the vacancies.
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 4
UPON A VOICE VOTE, ALL VOTING AYE, VICE CHAIRPERSON OSTWALD
DECLARED THE MOTION CARRIED.
Ms. Skogen handed out paper for the Commissioners to place their votes. After voting the
Commissioners handed their ballots to Ms. Skogen who then tallied the results. The results of
the vote were: Mr. Nelson – 6 votes, Mr. Johnston– 5 votes, and Ms. Rolstad – 3 votes.
Commissioner Braam MOVED and Commissioner Reiland seconded a motion to proceed
with the appointments in accordance with the results.
UPON A VOICE VOTE, ALL VOTING AYE, VICE CHAIRPERSON OSTWALD
DECLARED THE MOTION CARRIED.
Once the applicants returned, Vice Chairperson Ostwald informed them that Mr. Nelson and
Mr. Johnston would fill the immediate vacancies and Ms. Rolstad would fill the vacancy
created by Commissioner Scholzen resignation.
Mayor Lund recognized Commissioner Scholzen’s service of 10 years on the commission
and thanked her for that service.
OLD BUSINESS
A.Discussion of Chapter 7
Mr. Foster said he and other staff members have created a presentation and an accompanying
report based on the feedback from the last meeting and the Commissioners requests to provide
specific examples of how the levy restriction in Chapter 7 impacted City operations.
Upon Commissioner Reiland’s request, Mr. Foster provided some background information about
their discussions in previous months for the sake of the new appointees and Commissioners that
have missed past meetings. Mr. Foster then proceeded with the presentation.
Mr. Foster said there three main categories were identified showing how the City has been
impacted by the levy restriction. Information was gathered through discussing the impacts with
city staff and department managers. Examples of specific impacts were identified and
categorized into the categories of: 1) Financial trends/management, 2) diminishment of services,
and 3) the inability to react to unanticipated circumstances and mandates.
At Commissioner Walch’s request, Mr. Foster reviewed the language in Chapter 7 relating to the
levy restrictions and the historical behavior of the CPI.
Mr. Foster showed how debt has been impacted by the levy restriction. The City has been forced
to fund part of the operations or its equipment or through debt financing due to limited reserves
and no new funding sources. The City has been borrowing every 2-3 years compared with 8-10
years previously prior to the levy restrictions. Additionally, there is less money that has been
allocated to capital investments despite them being deemed necessary.
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 5
Moving forward, Mr. Foster outlined how daily operations have been impacted. He cited the
cost of gasoline increased 3.8% in 2016, electric costs increased 4.93%, and natural gas
increased 3.5% despite a CPI of 1.4% in 2016.
Commissioner Reiland asked to clarify that one could say that the CPI of 1.4% then is not
accurately accounting for the added cost in these areas, to which Mr. Foster agreed. Mr. Foster
then reviewed the impacts of the levy restriction and how Local Government Aid (LGA) is
allocated in the City’s budget.
Mayor Lund described how City Council wanted to use LGA for capital expenses, but due to the
levy/fee restrictions, LGA has been used toward operations instead of capital
improvements/investments.
Mr. Foster reviewed how debt financing and depleating fund balances has impacted the City’s
ability to finance/bond for the new civic campus due to the levy restrictions. Mr. Wysopal also
discussed how the current City Hall building deteriorated at a much faster rate as maintenance
projects could not be completed due to the lack of funding.
Mr. Foster described additional challenges provided by state-driven levy restrictions. He further
detailed how the state imposes restrictions regularly and how they can be more restrictive than
the language in the City Charter at times. Mr. Wysopal added that due to the City’s restriction,
any restriction provided by the state only adds complexity and a compounding effect on the
City’s ability to levy for needed services.
Mr. Foster reviewed the diminishment of services, citing how the City’s seal coating program
has been cut back due to 11% increase in costs, but the City budget had a flat levy from the prior
year which did not cover the additional expenses. This also adds to increased costs for road
maintenance in the future.
Additionally, Mr. Foster described how equipment replacement has been delayed to adapt to the
levy and fee restrictions.
Mr. Foster cited the City’s limited ability to treat and contain trees effected by Emerald Ash
Borer as a diminishment of services.
Commissioner Walch asked if Mr. Foster and others could provide more insight on how property
taxes are assessed, collected by the county, and then distributed to the city. Mr. Foster said the
levy restriction does not deal directly with home values or a percentage of that home value, but
rather the dollar amount associated with last year’s budget. Commissioner Walch confirmed
what Mr. Foster stated that the City is unable to capture any increase in home values. Further
discussion took place between Commissioner Walch, Mr. Wysopal, and Mr. Foster regarding
how the City’s levy is derived and provided from the county.
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 6
Mayor Lund gave an example on how the City has to adapt to circumstances. He cited the big
wind storm and citizen’s expectation that the City would collect and dispose of their tree
damage. Because the storm was city-wide, the City agreed to collect and dispose of trees and
limbs at a cost to the City over $500,000 dollars. He said if that happened again, The City
Council would have a very difficult time finding the funding for a similar incident.
Mr. Foster provided the next example related to the City’s recycling program. He said the
average cost increase each year for the recycling program is about 4%. Because the levy is often
restricted to a value much smaller than that and the City cannot raise the recycling rates, a
reduction in recycling services is inevitable. Mr. Wysopal further described how the levy
restriction has impacted the City’s ability to provide adequate recycling services.
Mr. Foster reviewed how the levy restriction has led to the City’s inability to react or adapt to
unanticipated circumstances or mandates, such as a potential mandate requiring all police
officers to wear “body-cams”, would be very difficult to fund.
Commissioner Reiland asked why the annual cost of the program was over half of the upfront
cost. Commissioner Soule said required a full time staff person to analyze and organize any new
data recorded on the cameras.
The next example provided by Mr. Foster was how the City has a lessened ability to respond to
market-driven salary increases for employees. He further described how Fridley is often behind
and below their labor competitors (largely neighboring cities) in their compensation.
Mr. Wysopal added this is was also compounded as personnel costs make up the largest part of
the City’s budget. He reiterated personnel costs are not tied to the CPI or any inflationary
measure, but set by the market.
Vice Chairperson Ostwald asked if the City had any issues with the retention of employees. Ms.
Skogen responded they did not. Mr. Foster said the City had a lot of long-term employees who
have been with the City for 20+ years and they are less likely to leave than newer employees.
Mr. Foster detailed the unanticipated increase in worker’s compensation insurance for 2017, a
required service. Mr. Wysopal added that an increase of $80,000 was made known to the City in
December at the time of renewal, despite the 2017 budget already being approved.
Mr. Foster said the early retirement of a K-9 unit as another unanticipated cost for the City.
There are significant costs with the training of the canine and the handler.
Mr. Foster added that in 2018 the City can expect an additional 1% contribution to the Police and
Fire pensions (PERA) as mandated by the State. This equates to roughly another $35,000
expense for which the City cannot levy.
Mr. Foster addressed the impact of tax court petitions. If a tax petition is awarded to a
commercial property against the City, that amount is subtracted from the annual tax levy. The
City does not have the ability to levy for the difference in their total tax levy. Mr. Wysopal
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 7
further clarified the tax petition process for Commissioners, its impact on the City, and how it is
further exacerbated by the language in Chapter 7.
Mr. Foster then described and summarized the aggregated challenges presented by the levy
restriction during the budgetary approval processes, including some specific dollar values
associated with some costs. In summation, Mr. Foster described a case study using the City’s
water utilities outlining the various touch-points that are impacted by the levy restriction in the
City Charter.
Mr. Wysopal provided the Commissioners with an overall summary of their research which was
in response to the request of the Charter Commission members from the previous meeting. He
thanked the Commissioners again for their time, patience, and openness for discussion.
Commissioner Findell said he was skeptical of the metrics or indexes available for the use of the
Commission, and the various variables that can influence them. He also added he trusts the City
and would like more pushback on cities having to fund certain mandates. Commissioner Findell
said he would like to see metrics or indexes that might be a better fit for the City’s levy purposes,
or other tactics or processes that could be used to protect the tax payers.
The Commissioners discussed the various metrics and their strengths and downfalls.
Mr. Wysopal directed the Commissioners to the initial questions for their discussion around
Chapter 7; those being: What is this measure (levy restriction) seeking to achieve, and is it
effective?
Commissioner Walch said it is likely it is too restrictive, but there still should be a balance in
how the Council works through their budgetary process to ensure the best interest of the tax
payers is preserved.
The Commissioners expressed their willingness to further discuss updating Chapter 7, especially
regarding the levy and fee restrictions within that chapter.
Commissioner Reiland MOVED and Commissioner Walch seconded a motion requesting
options or alternatives for language that could replace the language in Section 7.02 relating to the
levy and fee restrictions.
UPON A VOICE VOTE, ALL VOTING AYE, VICE CHAIRPERSON OSTWALD
DECLARED THE MOTION CARRIED.
Vice Chairperson Ostwald asked for staff to could help create a plan for putting the City back in
strong financial footing in the future. Mr. Wysopal added that reworking the language in Section
7.02 is only part of ensuring the City’s strong financial future. He added the City would not be
seeking to drastically increase the levy, and it would put more pressure on the Council to make
effective decisions during the budgetary process.
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CHARTER COMMISSION MEETING OF FEBRUARY 6, 2017 PAGE 8
Commissioner Findell said the original levy restriction in the charter required a vote of 4 out of 5
members of the City Council to increase the levy beyond the mill rate restriction. He suggested
that something similar might be implemented within the City’s recommendations or proposed
alternatives.
NEW BUSINESS
A.None
FUTURE TOPCIS
Administrative Matters
–Election of Officers
-Update of Chapter 2 Amendment
-Update of Vacancies
Old Business
Discussion of Chapter 7.02 language alternatives presented by City staff
ADJOURNMENT:
Commissioner Soule MOVED and Commissioner Reiland seconded a motion to adjourn the
meeting.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON REYNOLDS DECLARED
THE MOTION CARRIED AND THE MEETING WAS ADJOURNED AT 8:45 P.M.
Respectfully submitted,
Debra A. Skogen, MMC
City Clerk/Staff Liaison
Commissioner Donald Findell
Secretary
Draft
Debra A. Skogen, City Clerk, City of Fridley, 6431 University Avenue NE, Fridley, MN 55432
763-572-3523 Fax 763-502-4981 deb.skogen@fridleymn.gov
February 7, 2017
Honorable Douglas B. Maslow
Tenth Judicial District
Anoka County Government Center
325 E Main Street
Anoka County, MN 55303
Dear Honorable Judge Meslow,
Commissioners Marion (Ted) Flickinger and Novella Ollawore resigned their positions on the
Fridley Charter Commission at the end of 2016term expires on
vacancies. In addition Commissioner Lois Scholzen will not be renewing her term which expires
on May 1, 2017.
The City received three applications from the following individuals interested in the Charter
Commission. The applicants were interviewed and a vote was taken to appoint all three
applicants for the two vacancies and upcoming May vacancy of Ms. Scholzen.
Recommended Appointments
Name Address Term
st
Bruce Nelson 168 71 Way Appointment to fill
Fridley, MN 55432 Flickinger Term ending
April 22, 2018
Richard H. Johnston 456 Rice Creek Blvd NE Appointment to fill
Fridley, MN 55432 Ollawore term ending
September 19, 2017
Valerie Rolstad 1100 Lynde Drive NE Appointment to fill
Fridley, MN 55432 Scholzen term ending
May 1, 2017
Appointment of Charter Commissioners
February 7, 2017
Page 2
Two Commissioner terms end February 21, 2017. The Charter Commission has recommended
the following re-appointments:
Recommended Reappointments
Name Address Term
David Ostwald 6675 E River Road Expiration of term
Fridley, MN 55432 February 21, 2017
Barbara Reiland 5623 W Bavarian Pass Expiration of term
Fridley, MN 55432 February 21, 2017.
Thank you for your consideration of this recommendation of the Fridley Charter Commission. If
you have any questions, you may contact me by phone at 763-572-3523 or by e-mail at
deb.skogen@fridleymn.gov.
Sincerely,
CITY OF FRIDLEY
Debra A. Skogen, MMC/MMMC
City Clerk and Fridley Charter Commission Staff Liaison
January 4, 2017
Fridley Charter Commission Nominating Committee Report
The Nominating Committee consisted of Commissioners Barb Reiland, Don Findell and Manuel
Granroos.
rd
The Nominating Committee met on January 3 after the Charter Commission meeting. After
discussion, the Nominating Commission offered the following nominations to serve as the 2017-
2018 Charter Commission Officers:
Chair David Ostwald
Vice Chair Don Findell
Secretary Manuel Granroos
All three members have agreed to serve if elected.
TH
MONDAY MARCH 6
The annual election will be held on at 7 pm in Conference Room A in
the Upper Level.
Chapter 7 Discussion Continuation
As a response to the carried motion and request of the commissioners from the previous meeting,
further research on Chapter 7 has been performed by staff to provide recommendations to the Charter
Commission. Included is a brief summary of the initial analysis. Additional information and materials
will be provided during the March 6, 2017 meeting.
Chapter 7 Analysis Report
Obscurity of restrictions
853 MN cities, 746 statutory cities, 107 charter cities 2 cities with levy
o
limitations (~ 0.23%),
Fridley is the only city in the state with a restriction on all operational expenses
o
and is without franchise fees on gas and electric utilities.
Why the levy and fee restrictions were put into place:
Utility franchise fee ordinance was recalled via petition
o
Current language was proposed by a special interest citizen committee
o
What the levy and fee restrictions sought to accomplish:
Largely uncertain as to the specific goals outside of the response to further
o
taxation in the form of a franchise fee, but conclusions can be inferred
1.Slow levy increases
2.Prevent fees
3.
What the levy and fee restrictions have done:
Increased debt
o
Decreased reserves
o
Impacted/delayed capital investment projects
o
Decreased service levels
o
Created a controlling mechanism over Council Council is bound by restrictions
o
creating a lack of ğĭĭƚǒƓƷğĬźƌźƷǤ and ƷƩğƓƭƦğƩĻƓĭǤ in decision-making process
Statewide restrictions:
State law enables cities to impose their tax levy as they see fit unless there is a
o
State-imposed levy restriction
State has ability to impose statewide restrictions which are the result of a
o
The State will create a formula for implementing restrictions depending on
o
situational factors
Can/have create scenarios when statewide scenarios supersede city charters
o
(e.g. if LGA is cut, cities with charter restrictions are able to increase their levy to
makeup that loss)
West St. Paul Case study Mounds View Case study
West St. Paul Levy restriction history: Levy restriction characteristics:
1.1972: Levy restriction put in place -
1.Levy restriction still in place
$25 per capita with the number
adjusted through the CPI
2.Less restrictive allows for more
flexibility
2.2001: Charter Commission approved
unanimously for city to levy beyond
3.CPI +2%
restriction
4.Use a more
3.2005: Again, Charter Commission
CPI (6 months rather than a 2 year
approved unanimously for city to
lag)
levy beyond restriction
5.Allows for exemptions from
4.2007: Changed restriction from CPI
to IPD
capital investment projects, union
contracts, IT expenditures, etc.)
5.2012: Charter Commission
unanimously recommended the
6.Have both gas and electric franchise
removal of the restriction from the
fees in place, and in their
Charter
Other characteristics:
7.In 2005, Medtronic purchased golf
course land owned by Mounds View.
City Council has complete control to
Using those proceeds the City
(no restrictions)
support future levies. The 2017
budget includes $250,000 from that
No language on fees, but have
fund.
franchise fees in place
Charter sets broad guidelines, and
the policy specific are set by
ordinance
Charter Commission trusted the
ordinance recall process and their
elected officials to govern
responsibly
Chapter 7 Index and Fixed Percentage Analysis
Indexes
Definition: a normalized average of prices for a given class of goods or services in a given region
during a given interval of time. This concept can also be applied to averages for other economic
indicators (e.g. GDP, tax capacity, personal income, etc.)
What they do: provide indicators to describe the strength of the economy, change in inflation,
the cost-of-living, etc.
Pros:
1.Provides a specific number to which levies can be adjusted
2.Largely viewed as being mostly unbiased
Cons:
1.Lagging measures based on previous years (ex. Established 2018 budget levy based on CPI
change between 2015 and 2016)
2.Difficult to factor-in government expenditures most costs are not inflation-based, but
market-based
3.Cannot account for property values
4.Over complicate processes (e.g. When state restrictions are imposed)
5.Cannot account for unanticipated circumstances/mandates (e.g. Costs skyrocketing, natural
disaster, body cam mandate, etc.)
6.No triggering event
Fixed percentages
Goal/rationale: much like the use of indexes in the Charter, a fixed percentage would ensure
the City could not increase its past a specific number (i.e. percentage)
Pros:
1.Provides a specific number to which levies can be adjusted
2.Cannot be manipulated, or biased in any way
3.Time is not a factor in contrast with using an index
Cons:
1.Also cannot account for unanticipated circumstances/mandates (e.g. Costs skyrocketing,
natural disaster, body cam mandate, etc.)
2.mplexity (e.g. what should be considered as
part of a state identified exception)
3.No triggering event
4.Does not fluctuate, or adjust to circumstances (anticipated circumstances)
5.Not tied to any metric/measure completely separate from
6.Not connected to any expense or the cost of government operations
7.Cannot account for inflation
2017Charter Commission Membership
Name/AddressPhonee-mail addressAppointedTerm
Expires
Braam, Gary(h) 763-571-9582gbraam@msn.com06-01-04(1)05-31-2008
1436 66 th Avenue(w) 763-528-121402-05-08 (2)05-31-2012
5543202-13-1205-31-2016
05-27-1605-31-2020
Crandall, Zach(h) 612-240-0427zcrandall@hotmail.com05-27-1606-01-2020
th
6200 6Street NE(w) 612-849-8318
55432
Findell,Donald(h)763-571-0467donfinder@aol.com6-16-97(1)05-11-2001
6850 Siverts Lane2-21-01(2)05-01-2005
554325-4-05(3)05-01-2009
2-4-0905-01-2013
05-24-1305-01-2017
Manuel Granroos(h) 763-571-0811mannyjg2389@gmail.com10-21-1409-02-2018
rd
1114 63Ave NE(c)612-710-0332
Fridley, MN 55432
Richard Johnston7637-772-7556johnstonrr@msn.com02-15-1709-19-2017
456 Rice Creek Blvd
Fridley, MN 55432
Ted Kranz(h) 763-571-4387Tkranz1@comcast.net8-11-06 (1)04-22-2010
6701 Monroe Street NE03-29-10(2)04-22-2014
5543210-21-1404-22-2018
Bruce Nelson763-439-3659binelson@comcast.net02-15-1702-22-2018
168 71 st Way NE
Fridley, MN 55432
Rick Nelson(c) 612-963-2487rickvan16@hotmail.com05-12-1102-13-2012
4624 2 ½ Street NE02-13-1202-21-2016
5542105-27-1602-21-2020
David Ostwald763-572-3865dostwald@tonkawa.com10-21-1402-21-2017
6675 East River Road(c) 763-234-295002-15-1702-21-2021
Fridley, MN 55432
Barb Reiland763-571-0801barb642@mac.com02-13-1202-21-2013
5623 W Bavarian Pass05-21-1302-21-2017
5543202-15-1702-21-2021
Reynolds, Pam(c) 763-222-9386fnpam@hotmail.com5-12-05(v)05-01-2007
1241 Norton AveNE3-22-0705-01-2011
5543204-04-201105-01-2015
05-04-201505-01-2019
Rolstad, Valerie612-799-5993A2busymama4u@hotmail.com02-15-201705-01-2017
1100 Lynde Drive
Fridley, MN 55432
Soule,Cynthia(h) 763-572-9666csoule@primetherapeutics.com6-16-97(1)05-11-2001
7838 Firwood Way(c) 612-414-53192-21-01(2)05-01-2005
554325-4-05 (3)05-01-2009
2-4-0905-01-2013
05-24-1305-01-2017
Stark, Avonna(h) 612-423-6939Avonna.caroline@gmail.com05/22/15 (1)05/04/2019
305 Longfellow St NE(w) 651-296-3205
55432
Richard Walch(h) 763-213-9659rbwalch@yahoo.com09-09-201309-09-2017
th
6859 7Street NE(w) 612-671-7757
55432
02/21/2017
Handout at March 6, 2017 Charter Commission MeetingPage 1
Chapter 7 Discussion Continuation
As a response to the carried motion and request of the commissioners from the previous meeting,
further research on Chapter 7 has been performed by staff to provide recommendations to the Charter
Commission. Included is a brief summary of the initial analysis. Additional information and materials
will be provided during the March 6, 2017 meeting.
Chapter 7 - Analysis Report Summary
Move to a more simplified Chapter 7
Sets wide parameters
o
Builds on election process and the recall provision of the Charter
o
o
Provides further clarity
o
Less complexity
o
Eliminate redundancy
o
Reflect a more modern charter city provide further consistency
Build consistency throughout with state statute
o
Uphold generally accepted accounting principles (GAAP)
o
General/limited language - policy implementation is largely ordinance/code-
o
driven
Restriction not tied to index or fixed percentage
Public process driven
o
Provides voice to citizens
o
Provides levels of accountability and transparency that did not previously exist
o
o
applicable
Tying a levy restriction to an index or a fixed percentage handcuffs the
ability react to circumstances, provide services, and effectively address citizen desires.
public-process-driven solution provides non pre-existing avenues for public deliberations that
Council members.
Handout at March 6, 2017 Charter Commission MeetingPage 2
Chapter 7 Analysis Report
Obscurity of restrictions
853 MN cities, 746 statutory cities, 107 charter cities 2 cities with levy
o
limitations (~ 0.23%),
Fridley is the only city in the state with a restriction on all operational expenses
o
and is without franchise fees on gas and electric utilities.
Why the levy and fee restrictions were put into place:
Utility franchise fee ordinance was recalled via petition
o
Current language was proposed by a special interest citizen committee
o
What the levy and fee restrictions sought to accomplish:
Largely uncertain as to the specific goals outside of the response to further
o
taxation in the form of a franchise fee, but conclusions can be inferred
1.Slow levy increases
2.Prevent fees
3.
What the levy and fee restrictions have done:
Increased debt
o
Decreased reserves
o
Impacted/delayed capital investment projects
o
Decreased service levels
o
Created a controlling mechanism over Council Council is bound by restrictions
o
creating a lack of ğĭĭƚǒƓƷğĬźƌźƷǤ and ƷƩğƓƭƦğƩĻƓĭǤ in decision-making process
Statewide restrictions:
State law enables cities to impose their tax levy as they see fit unless there is a
o
State-imposed levy restriction
State has ability to impose statewide restrictions which are the result of a
o
A, property tax % change, etc.)
The State will create a formula for implementing restrictions depending on
o
situational factors
Can/have create scenarios when statewide scenarios supersede city charters
o
(e.g. if LGA is cut, cities with charter restrictions are able to increase their levy to
makeup that loss)
Handout at March 6, 2017 Charter Commission MeetingPage 3
West St. Paul Case study Mounds View Case study
West St. Paul Levy restriction history: Levy restriction characteristics:
1.1972: Levy restriction put in place -
1.Levy restriction still in place
$25 per capita with the number
adjusted through the CPI
2.Less restrictive allows for more
flexibility
2.2001: Charter Commission approved
unanimously for city to levy beyond
3.CPI +2%
restriction
4.
3.2005: Again, Charter Commission
CPI (6 month more current)
approved unanimously for city to
levy beyond restriction
5.Allows for exemptions from
4.2007: Changed restriction from CPI
capital investment projects, , IT
to IPD
expenditures, etc.)
5.2012: Charter Commission
6.Have both gas and electric franchise
unanimously recommended the
removal of the restriction from the
Charter
7.In 2005, Medtronic purchased golf
Other characteristics:
course land owned by Mounds View.
Using those proceeds the City
City Council has complete control to
support future levies. The 2017
(no restrictions)
budget includes $250,000 from that
fund.
No language on fees, but have
franchise fees in place
Charter sets broad guidelines, and
the policy specific are set by
ordinance
Charter Commission trusted the
ordinance recall process and their
elected officials to govern
responsibly
Handout at March 6, 2017 Charter Commission MeetingPage 4
Chapter 7 Index and Fixed Percentage Analysis
Indexes
Definition: a normalized average of prices for a given class of goods or services in a given region
during a given interval of time. This concept can also be applied to averages for other economic
indicators (e.g. GDP, tax capacity, personal income, etc.)
What they do: provide indicators to describe the strength of the economy, change in inflation,
the cost-of-living, etc.
Pros:
1.Provides a specific number to which levies can be adjusted
2.Largely viewed as being mostly unbiased
Cons:
1.Lagging measures based on previous years (ex. Established 2018 budget levy based on CPI
change between 2015 and 2016)
2.Difficult to factor-in government expenditures most costs are not inflation-based, but
market-based
3.Cannot account for property values
4.Over complicate processes (e.g. When state restrictions are imposed)
5.Cannot account for unanticipated circumstances/mandates (e.g. Costs skyrocketing, natural
disaster, body cam mandate, etc.)
6.No triggering event
Fixed percentages
Goal/rationale: much like the use of indexes in the Charter, a fixed percentage would ensure
the City could not increase its past a specific number (i.e. percentage)
Pros:
1.Provides a specific number to which levies can be adjusted
2.Cannot be manipulated, or biased in any way
3.Time is not a factor in contrast with using an index
Cons:
1.Also cannot account for unanticipated circumstances/mandates (e.g. Costs skyrocketing,
natural disaster, body cam mandate, etc.)
2.
part of a state identified exception)
3.No triggering event
4.Does not fluctuate, or adjust to circumstances (anticipated circumstances)
5.Not tied to any metric/measure completely separate from
6.Not connected to any expense or the cost of government operations
7.Cannot account for inflation
Handout at March 6, 2017 Charter Commission MeetingPage 5
Chapter 7 Miscellaneous considerations
Chapter 7 is far too specific for an overarching guiding government documentation
Modern charter cities rely more heavily on ordinance/code driven enforcement of charter
objectives
Staff recommends that the entire chapter be revised in accordance with Generally Accepted
Accounting Principles (GAAP) and State statute. In addition, remove redundancy and
complexity
Levy restriction assumes the Council is incapable of responsible budgeting
Ordinance recall process works and has worked (e.g. current restrictions in Ch. 7!)
Trust in Council to make decision in best interest of residents
o
Specific process provides transparency and allows for public scrutiny
o
Ordinance-driven, so language can be adjusted with time/under new circumstances
o
Addresses each of the goals for Chapter 7 restriction
o
The State provides adequate means for levy limitations
Fee restriction creates issues with utility companies many utility company employees do not
realize they need to pull permits to work in the right-of-way as franchise agreements remove
this need the often creates logistical and administrative issues
All of the initial goals that the Chapter 7 restrictions set out to accomplish can be met by a
process-driven solution; in some instances, (e.g. accountability and transparency) improvements
are made
some 2001, p. 2, paragraph 8
2005, p. 3, paragraph 4
levy limits. He
feels if the Commission passed the levy, this would give the tools necessary for the Council to do
- 2005, p. 3, paragraph 7
memb
paragraph 6 (Section 7.09, Subd 2 Limitations on Property Tax Levy
Handout at March 6, 2017 Charter Commission MeetingPage 6
Vision of what the City Code for a budget process might look like:
Council establishes parameters and goals for the upcoming budget yearThis could be
updating a long range plan
o
Taking into consideration any public needs (such as any relevant indexes)
o
Identifying key objectives for next year
o
Establishing the maximum impact to average properties
o
Develop a 5 year Capital Investment Program (CIP)
Gather department requests
o
Team prioritizes projects and equipment
o
Council reviews preliminary CIP
o
Public meeting to review CIP
o
Council approves CIP
o
Operation budget is developed based off Council objectives, parameters and approved CIP
City Manager prepares preliminary operation budget
o
Council reviews preliminary budget
o
Preliminary levy established based on and State limitations, the approved CIP and
o
preliminary budget
Public meeting to comment on budget and preliminary levy
o
Developing a budget following an ordinance and any policies established by the City Manager allows
Council the ability to fully deliberate.
It allows for adjustments through an ordinance process which still gives citizens the ability to petition
and Council a better means to address changes to the financial environment.
Chapter 7 Fee Restriction Outline/Main points
1.Provide general guidelines fee implementing and maintaining fees
Should be in accordance with State Statute
o
The Charter (Including Chapter 7) should set general guidelines for how the City should
o
operate/function
Fees should be implemented with the requirement that they recapture any present
o
costs with marginal amounts collected to address future costs