05-09-2022 Conf. Mtg.
COUNCIL CONFERENCE MEETING
May 09, 2022
5:00 PM
Fridley Civic Center, 7071 University Avenue N.E.
AGENDA
1.2021 Performance Measurement Program
2.2023 Budget Outlook & Objectives
The City of Fridley will not discriminate against or harass anyone in the admission or access to, or treatment, or
employment in its services, program, or activities because of race, color, creed, religion, national origin, sex, disability,
age, marital status, sexual orientation or status with regard to public assistance. Upon request, accommodation will
Hearing impaired persons who need any interpreter or other persons with disabilities who require auxiliary aids
should contact Roberta Collins at (763) 572-3500. (TTD/763-572-3534).
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AGENDA REPORT
Meeting Date:May 9, 2022 Meeting Type:City CouncilConference Meeting
Submitted By:Melisa Moore, City Clerk
Brooke Hall, Communications Specialist
Title
2021Performance Measurement Program
Background
In 2019, the City of Fridley (City), under the general direction of the City Manager, formed the Process
Management (PMT) to improve the efficiency and efficacy of City programs and services. The PMT
consists of staff from each department, trained in continuous improvement, performance measurement
and problem solving, among other areas.
The PMT consists of twocommittees: 1) Process Improvement (Process); and 2) Performance
Measurement (Performance). The Process Committee(s)seeks to improve businesses processes by
reducing waste and enhancing quality. The Performance Committee developeda set of measures based
on guidance from the Minnesota Local Performance Measurement Program (Program) offered by the
Office of the State Auditor (OSA) in conjunction with the Council on Local Results and Innovation.
By formally reporting on at least 10 of the 29 performance measures identified by the Program to the
OSA, the City may receive two benefits: 1) a per capita reimbursement of $0.14; and 2) an exemption
from property tax levy limit ifthey are in effect. Toparticipate in the Program, the City Council must
adopt the minimum number of performance measures, report them at least annually to residents and
submit a document detailing the actual results.
Based on those criteria, the PMT drafted the 2021Performance Measures Report (attached), which
outlines 18performance measures.In addition to the benefits of the Program, the City will use the report
to inform policy decisions, such as budget recommendations, and to gauge the success of City programs
and services.
Attachments and Other Resources
Draft2021Performance Measurement Report
Vision Statement
We believe Fridley will be a safe, vibrant, friendlyand stable home for families and businesses.
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2021
Performance Measures
Report
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City of Fridley | 2021 Performance Measurement Report
In summer 2019, the City of Fridley Process Management Team was formed with representatives from
every department. After completing an in-depth analysis of customer service standards at the Fridley
Civic Campus, the team was separated into two subcommittees: Process Improvement and Performance
Measurement.
The Process Improvement Subcommittee was tasked with reviewing applications from departments
was assigned with developing a report on the required measures for the State of Minnesota Performance
Measurement Program through the Council on Local Results and Innovation (CLRI).
The Performance Measurement Committee coordinated with City departments to report on 18 measures in
the report. The measures were divided into four categories: General, Police, Fire and Public Works (Streets,
Water and Sanitary Sewer).
Within the report, there is a full overview of the elected performance measures data, as well as individual
data sets and descriptions of the measurements. Descriptions include what data is being measured, why
the data is important, and what the results mean for the City of Fridley.
For the 2021 report, the Process Management Team consisted of the following members:
Performance Measurement SubcommitteeProcess Improvement Subcommittee
Brooke Hall, ChairBeth Kondrick, Chair
Roberta CollinsMike Grundman
Karen FischerPatrick Maghrak
Melissa MooreJessica Nelson-Roehl
Stacy StrombergMikey Oman
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City of Fridley Standard Performance Measures
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For the Year Ended December 31, 2021
General
20172018201920202021
Percentage Change in Taxable
6.60%12.80%6.37%7.64%6.29%
Market Value
Nuisance Code Enforcement
26.1249.3558.7233.8635.18
Cases per 1,000 population
Bond RatingAa2Aa2Aa2Aa2Aa2W
Not selected Not selected Not selected Not selected for Not selected
Accuracy of Post Election Audit
for auditfor auditfor auditauditfor audit
Feeling Safe in the CityN/AN/AN/A98%N/A
Police Services
Part I Crime Rates1,1181,1001,1481,3291,312
Part II Crime Rates1,4121,4611,1631,007842
Part I Crime Clearance Rates25%26%28%24%32%
Part II Crime Clearance Rates50%52%52%42%50%
Average Police Response Time3:27 Minutes3:12 Minutes3:33 Minutes3:53 Minutes5:39 Minutes
Fire & EMS Services
Insurance Industry Rating of
Class 3Class 3Class 3Class 3Class 3
Fire Services
Average Fire Response Time5:00 Minutes6:00 Minutes5:47 Minutes6:07 Minutes6:07 Minutes
Fire Calls Per 1,000 Population 128919411495
Number of Fires with Losses
3545443940
Resulting in Investigation
Streets
Average City Street Pavement
7.086.926.506.846.80
Condition Rating
Expenditures for Road
Rehabilitation per Paved Lane $150,803N/A$194,894$213,794$122,515
Mile Rehabilitated
Percentage of All Jurisdiction
Lane Miles Rehabilitated in a 1.68%0%0.51%3.148%2.580%
Year
Water
Operating Cost per 1,000,000
Gallons of Water Pumped/$1,741$1,846$1,957$1,868$1,886
Produced
Sanitary Sewer
Number of Sewer Blockages
on City System per 100 .036.060.048.036.012
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Connections
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General: Market Value, Code Enforcement, Bond Rating, Elections
Taxable Property Market
20172018201920202021
Value
Percentage Change6.60%12.80%6.37%7.64%6.29%
Taxable Market Value2,263,260,4002,411,702,930 2,720,564,453 2,945,538,0613,240,926,104
Percent Change in the Taxable Market Value
What is it?
As a local taxing jurisdiction, property taxes are the principal funding source for the City and its
operations. For some real property, a portion of its market value may be excluded from taxation,
such as the Homestead Market Value Exclusion. Once those a taxing jurisdiction applies those
exclusion, the market value becomes the Taxable Market Value (TMV).
Why does it matter?
The City uses the TMV to help determine the tax liability for each property within its jurisdiction.
Usually, when the TMV for the City increases, the property tax rate decreases, and a property
pays less in City property taxes. In other words, when the City grows and there more properties
to pay taxes, they can all pay a little less.
What does the data tell us?
Over the past few years, the City
the TMV, increasing about 33% since
2016. Generally, the City attributed this
change to a strong housing market
and several substantial redevelopment
projects, including Cielo Apartment
Homes and Northern Stacks, among
others. Coupled with other changes
in the local real estate market, the
City was able to generate additional
property tax revenues for the entire
Fridley community.
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General: Market Value, Code Enforcement, Bond Rating, Elections
Nuisance Code
20172018201920202021
Enforcement Cases
Cases per year7261,3691,6299921,041
Population per year27,79227,74227,74229,30029,590
Cases Per 1,000 Residents26.1249.3558.7233.8635.18
(# of cases/population) X 1,000 = Cases per 1,000 population, Source: City Planning Division &
Population ASC Source
Nuisance Code Enforcement Cases (Per 1,000 Residents)
What is it?
The City must preserve and protect the general welfare of its residents, including the abatement
and prevention of public nuisances. Minnesota Statute § 561.01 states “Anything which is
property, so as to interfere with the comfortable enjoyment of life or property, is a nuisance.”
Why does it matter?
Public nuisance ordinances are designed to preserve the peace, quality of life, morals and public
health of a community. The Fridley City Code regulates a number of activities to prevent the
creation of public nuisance, including: compost, refuse and yard waste storage; exterior storage;
fences; housing and lawn maintenance; home occupations; noise; vehicle parking, sale and
for families and businesses.
What does the data tell us?
Between 2017 - 2019, nuisance code
enforcement cases per 1,000 residents
and the expansion of the Fridley City
Code to include back or rear yard storage
in 2019. The cases dropped in 2020 due
to a decrease in bank-owned properties
and code enforcement visits due to
the COVID-19 health pandemic. As a
result, the City anticipates nuisance code
enforcement case to increase in the next three years then return to more typical caseloads.
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General: Market Value, Code Enforcement, Bond Rating, Elections
Moody Bond Rating
20172018201920202021
Rating
Aa2Aa2Aa2Aa2Aa2
Source: Moody’s Investor Services
Bond Rating
What is it?
On occasion, the City issues debt, known as bonds, to support capital improvements (e.g., road
institution lends money to the City and the City agrees to repay it with interest over many years.
To verify the City’s ability to make those payments, it receives a bond rating from an independent
agency, Moody’s Investor Services (Moody’s). The agency evaluates the City on several factors,
Why does it matter?
A bond rating may be thought of as a measure of risk or the likelihood that the City would not
uses the bond rating to determine the cost to the City to borrow money – expressed as a higher
or lower interest rate. The higher the bond rating, the lower the interest rate and vice versa. In
some situations, a lower bond rating (higher interest rate) could cost hundreds of thousands of
dollars in additional interest costs.
What does the data tell us?
The City maintains an Aa2, or the third highest, bond rating from Moody’s. The most
redevelopment activities. In 2016, Moody’s Investor Services downgraded the City when it
borrowed about $50,000,000 to construct the Fridley Civic Campus, noting the concentration of
the property tax base, elevated debt load and lower than average household incomes for the
community.
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General: Market Value, Code Enforcement, Bond Rating, Elections
Election Cycle
20162017201820192021
Accuracy of Post Not Selected Not Selected Not Selected Not Selected Not Selected
Election Elected for Auditfor Auditfor Auditfor Auditfor Audit
Accuracy of Post-Election Audit Results
What is it?
every state general election, Minnesota counties perform a post–election review of election
results returned by the optical scan ballot counters used in the state. The review is a hand
count of the ballots for each eligible election (US President, US Senator, US Representative and
Governor) in the selected precincts compared with the results from the voting system used in
those precincts.”
For Anoka County (County), the County Canvassing Board must conduct a review of at least four
precincts, or three percent of the total number of precincts in the County, whichever is greater.
The precincts must be selected randomly.
Why does it matter?
Post–election audits allow the City, other levels of government and the public to verify election
turn, the review helps the City improve internal processes and service delivery.
What does the data tell us?
Since 2016, the County has not selected the City for a post–election audit. To date, the City has
not experienced any concerns or issues with election accuracy.
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
Police Services: Crime Rates, Clearance Rates and Response Times
20172018201920202021
Part I Crime
1,1181,1001,1481,3291,312
Part II Crime
1,4121,4611,1631,007842
Total
2,5302,5612,3112,3362,154
Source: City Police Division
Part I and Part II Crime Rates
What is it?
include homicide, sexual assault, robbery, aggravated assault, burglary, larceny-theft (shoplifting,
pickpockets), motor vehicle theft, and arson. Part II crimes include other assaults, forgery and
Why does it matter?
promoting public safety. Partnering with the community through engagement, leadership and
education, assists in keeping Part I and Part II crime rates low.
What does the data tell us?
The Police Division responds to thousands of calls for service each year. Generally, Fridley
comparable surrounding communities.
Part I Crimes remained steady in 2021. At the same time, less violent Part II Crimes decreased
In Fridley, the Police Division saw a decline in fraud and forgery, which may be attributed to
businesses taking stronger actions regarding accepting checks and credit cards.
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
Police Services: Crime Rates, Clearance Rates and Response Times
20172018201920202021
Part I Clearance
25%26%28%24%32%
Rate (%)
Part II Clearance
50%52%52%42%50%
Rate (%)
Source: City Police Division
Part I and Part II Clearance Rates
What is it?
Clearance rates measure the number
of calls for service involving Part I
and Part II crimes leading to various
resolutions including warnings,
citations or even arrests. The
clearance rate is calculated by
dividing the number of crimes that
are cleared by the total number of
crimes recorded.
Why does it matter?
The Police Division promotes the
safety of the community and the
feeling of security through the
maintenance of law and order. This
includes following through and
applying legal penalties for violations.
What does the data tell us?
Evaluating the rate at which Part I
and Part II crimes are cleared is often
solving crimes. The decrease in 2020
is a result of a change in reporting
systems this year. Previously, only the top three counts were included in 2020,
all counts of the crimes are factored into the clearance rate.
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
Police Services: Crime Rates, Clearance Rates and Response Times
20172018201920202021
Average Police
3:27 minutes3:12 minutes3:33 minutes3:53 minutes5:39 minutes
Response Time
Source: City Police Division
Average Police Response Time
What is it?
The average police response time details calls for service through the Anoka County Dispatch
indicated they arrived on scene.
Why does it matter?
The Police Division promotes the safety of the community and the feeling of security through the
maintenance of law and order, crime prevention, timely response to requests for police service,
and positive contacts with the public.
What does the data
tell us?
Response times saw an
increase in 2021. This
may be due to new
hires, training shifts,
and operating at shift
take a bit longer to respond
to calls as they learn the
layout of the city, and lower
priority calls have had to
wait longer than usual to be
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
20172018201920202021
Insurance
Industry Rating of Class 3Class 3Class 3Class 3Class 3
Fire Services
Source: City Fire Division
Insurance Industry Rating of Fire Services (Rating/Every 5 Years)
What is it?
therefore it is less expensive to insure.
Why does it matter?
Why does the data tell us?
The Fire Division has been able to maintain an ISO rating of Class 3 consistently over the years,
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
20172018*201920202021
Fire Calls per 1,000
128919411495
Population
Fire Calls per 1,000 Population
What is it?
estimated at about 29,300. Based on the number of calls and total residents, there were 114
emergency responses per 1,000 Fridley residents.
Why does it matter?
The Fire Division projects an increase of more than 14 percent in emergency response calls
over the next few years. This is based on the planned future residential housing and multi-story
developments that lead to an estimated increase of 4,000 residents. The increase will determine
Why does the data tell us?
In 2018, the Fire Division reduced
the amount of call types they
responded to, which resulted
in a decrease in calls per 1,000
residents. In 2020, the Fire
Division began responding to
medical-related calls again to
assist the Police Division with
the increase in calls during the
pandemic. The Fire Division had
more access to Personal
Protective Equipment (PPE),
which allowed them to better respond to illness-related calls for service.
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
20172018201920202021
Average Fire
5 minutes6 minutes5:47 minutes6:07 minutes6:07 minutes
Response Time
Source: City Fire Division
Average Fire Response
What is it?
company within a 240-second travel time (four minutes) to 90 percent of the incidents.” That
means every second counts, including call answering time (15 seconds), call processing time (60
from home is approximately 6-10 minutes.
Why does it matter?
communities. Therefore, it is crucial that local governments take these statistics seriously and
What does the data tell us?
The decrease in 2017 may be
related to the switch in reporting
softwares during that year.
This could account for the way
response times were being
reported and incomparable data
sets during that time. An increase
in 2020 is related to a change
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General: Market Value, Code Enforcement, Bond Rating
Fire & EMS Services: Rating, Response Times, Calls, Fire DataPublic Works: Streets, Water and Sanitary Sewer
20172018201920202021
3545443940
resulting in investigation
Source: Fire Division
Number of Fires Resulting in Investigation and Financial Loss
What is it?
Why does it matter?
local, state and national levels.
What does the data
tell us?
The data represents a general
and providing the same level
of service, even as the city has
grown in value and population
with residential development.
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General: Market Value, Code Enforcement, Bond Rating
Public Works: Streets, Water and Sanitary Sewer
20172018201920202021
Average City Street
Pavement Condition 7.086.926.56.86.8
Rating
Source: Engineering Division
Average City Street Pavement Condition Rating
What is it?
Public Works employees inspect City streets each year. Each street is given a rating on the
Pavement Surface Evaluation and Rating (PASER) scale based on cracks, utility cuts and
imperfections on the roadway. On the scale, 0 is the worst and 10 is the best. Data previous to
Why does it matter?
Regular roadway minor maintenance methods such as roadway and crack sealing and micro
reconstructed entirely – which is much more expensive. Continued maintenance helps slow
the aging of the pavement. However, once the pavement is 50-60 years old, too much minor
pavement quality.
What does the data tell us?
The ratings are used to determine
whether the City’s road
maintenance and rehabilitation
strategies are satisfactory, and
if there is a change in pavement
quality, which may indicate that
a higher or lower investment in
pavement preservation is required.
a fully accurate comparison due to
conversion of old ratings to the new
PASER system. The rating remained
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General: Market Value, Code Enforcement, Bond Rating
Public Works: Streets, Water and Sanitary Sewer
20172018*201920202021
Expenditures for road
rehabilitation per paved $150,803N/A$194,894$213,794$122,515
lane mile rehabilitated
Source: Engineering Division *There was no rehabilitation project for 2018.
Expenditures for Road Rehabilitation Per Paved Line
Mile Rehabilitated
What is it?
This data is measuring the cost per mile for major reconstruction of roadways. The amount is
given year.
Why does it matter?
cost of construction, and if improvements need to be made in the manner in which roads are
construction and rehabilitation of roadways.
What does the data
tell us?
The data tells the City how
projects are, and displays
rehabilitation project that year.
In 2020, Council approved
additional investments to
street habilitation through
reconstruction. In 2021, a combination of reconstruction and resurfacing was used, which
reduced the average cost rehabilitation for the year.
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General: Market Value, Code Enforcement, Bond Rating
Public Works: Streets, Water and Sanitary Sewer
20172018*201920202021
Percentage of all
jurisdiction lane miles 1.68%N/A0.51%3.15%2.6%
rehabilitated in the year
Source: Engineering Division
Percentage of All Jurisdiction Lane Miles Rehabilitated in
the Year
What is it?
rehabilitated every year. The goal is to average 2.5 percent per year.
Why does it matter?
If mileage is lower and streets are not being rehabilitated, the average age of the pavement gets
older and the quality of streets are reduced. To provide for a stable budget and yet be cost-
should be relatively consistent each year and meet the percentage goal on average.
What does the data tell us?
The data shows a decrease in the
number of miles rehabilitated in
2019 compared to previous years.
This is related to project delivery
factors (how long it takes to
receive permits, amount of
funding, and coordination with
other city/county/state projects
quickly projects are completed.
The City increased mileage and
completed a backlog of previous
years’ projects to exceed this goal during 2020.
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General: Market Value, Code Enforcement, Bond Rating
Public Works: Streets, Water and Sanitary Sewer
20172018201920202021
Average Hours to
Complete Road System 6.88 hours7.33 hours6.28 hours7.39 hours7.25 hours
During Snow Event
Source: Streets Division
Average Hours to Complete Road System During Snow Event
What is it?
The amount of time, in hours, it takes for City plows to clear City streets. The Public Works
department clears 87 miles of streets, 29 miles of trails, and 12 miles of sidewalks. In total,
the City clears 180 street lane miles. Street lane miles account for both sides of the roadway
being cleared.
Why does it matter?
Winter road safety is extremely important to the community. Average hours of a plow route
keep businesses open and the ability to use recreation amenities.
What does the data
tell us?
The data is an indicator of how
are and the level of customer
service the City is delivering to
the residents. Data in a given
year also indicates quantity
and frequency of snow events,
type of snow (light/heavy),
ice conditions and timing and
duration of snowfall. Data can vary year-over-year depending on how many snowfalls occurred
and conditions at the time of snowfall. The increase in 2020 is related to the length of snowfalls,
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General: Market Value, Code Enforcement, Bond Rating
Public Works: Streets, Water and Sanitary Sewer
20172018201920202021
Operating Cost in
Dollars per 1,000,000 $1,741$1,846$1,957$1,868$1,886
gallons of water
Source: Water Division
Operating Cost per 1,000,000 Gallons of Water Pumped/Produced
What is it?
The treatment, storage, and distribution operating costs for every million gallons of drinking
water produced and delivered. The cost includes labor, supplies, maintenance, equipment and
repairs, among other items.
Why does it matter?
costs of supplies, labor, and equipment.
What does the data
tell us?
Year-over-year, the cost per
gallon of water produced has
been increasing slightly. While
overall operating costs have
remained stable, many of these
production. Customers are
conserving water, which leads
to an increase in operating costs
for a given volume of drinking
water treated and delivered. As
an example, even with less water going through a pump, its cost to maintain and eventually be
replaced are dependent on its age rather than its use. Filters, storage tanks, distribution pipes
and other components of the City’s water treatment and delivery system must be maintained
regularly, regardless of use.
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General: Market Value, Code Enforcement, Bond Rating
Public Works: Streets, Water and Sanitary Sewer
20172018201920202021
Number of Sewer
Blockages on City System 0.0360.0600.0480.0360.012
per 100 Connections
Source: Sewer Division
Number of Sewer Blockages on City System per 100 Connections
What is it?
The amount of times that Public Works responds to an emergency sewer main blockage per
coordination of service cleaning by contractors.
Why does it matter?
for cleaning the sewer mains. The program reduces incidents of sewage backups that impact
the City to have the Public Works Department check to verify whether there is a blockage in the
main or sewer service. This may save the resident from having to pay a contractor to clean the
service.
What does the data tell us?
Sanitary Sewer Division is cleaning
mains on a regular basis. The City’s
goal is to meet recommended
cleaning of all mains within a two-
has exceeded this goal for over a
decade, cleaning the entire system
every 1.5 years. Year-over-year
data shows that blockages are
very infrequent, and the continued
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AGENDA REPORT
Meeting Date:May 9, 2022 Meeting Type:City Council Conference Meeting
Submitted By:Joe Starks, Finance Director/City Treasurer
Title
2023 Budget Outlook & Objectives
Background
This will be our initial discussion regarding the 2023 Budget outlook and objectives.
Discussion
2023 BudgetDevelopment
Focus on Fridley Strategic Alignment
Vibrant Neighborhoods &PlacesCommunity Identity &Relationship Building
X Financial Stability & Commercial ProsperityPublic Safety & Environmental Stewardship
Organizational Excellence
Attachments and Other Resources
Budget Outlook & Objectives Presentation
Vision Statement
We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses.
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OUTLOOK AND OBJECTIVES
PLANNING 2023 BUDGET
MAY 9, 2022
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OVERVIEW
•2021 General Fund Budget Performance & 2022 Budget
•Budget Planning Projections for 2023 Budget
•Long–Term Financial Plan
•Economic Expectations
•General Fund Revenue Assumptions
•General Fund Expenditure Assumptions
•Other Considerations
•Next Steps and Other Considerations, Objectives, Guidance
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GENERAL FUND
2021 BUDGETPERFORMANCE(U NAUDITED) & 2022
ADOPTEDBUDGET
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GENERAL FUND, REVENUES
•For Fiscal Year 2021, actual revenues exceeded the budget by
approximately $972,360
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GENERAL FUND, EXPENDITURES
•For Fiscal Year 2021, actual expenditures were below budget by
approximately $380,540 prior to the transfer out.
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GENERAL FUND, BALANCE HISTORY
General Fund Balance History, 2003–2021 (Partially Unaudited)
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$-
Working Capital 35%Working Capital 50%Fund Balance
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LONG–TERM
FINANCIAL PLAN
P LANNING 2023 B UDGET
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LONG–TERM FINANCIAL PLAN
•Consistent with the Vision Statement and Organizational Values of
the City, the Planning 2023 Budget seeks to provide excellent public
services at a fiscally responsible cost
•Under this general goal, the City relies upon a series of guidelines to
inform the development of the annual budget:
•To stabilize ongoing revenues and expenditures, and eliminate
unanticipated variances
•To maintain structural balance and appropriate cash or fund balance levels
•To increase accountability and transparency throughout the budget process
•To make greater use of existing City resources
•To ensure a financially competitive organization with exceptional service
levels
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LONG–TERM FINANCIAL PLAN
•Through this process and using the budget guidelines, the City
Council accomplished several long–term goals, including:
•Ending the use of equipment certificates
•Ending the use of the Closed Bond Fund
•Creating the Community Investment Fund
•Reducing the operating budget reliance on Local Government Aid
•Stabilizing the Streets Capital Projects Fund
•Responding to cost pressure on the budget proactively
•Maintaining a strong overall financial position
•Improving budget communications and transparency
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ECONOMIC EXPECTATIONS
•State Forecast
•The State’s projected budget surplus is currently $9.3 billion, which could grow into fiscal year 2024-2025 biennium,
with a projected surplus of $15.287 billion
•Inflation will likely add as much as $1.1 billion to state expenditures during that timeframe
•Federal Forecast
•Projected 5-7 Federal Funds Rate increases (200 –300bp or 2 to 3 percentage points) by end of 2022, going into
2023
•Intended to slow inflation and moderate consumer price increases
•Cost of borrowing more expensive
•Increased interest earnings on City funds
•Several factors continue to cause uncertainty in economic forecasts, including:
•Fluctuations in Novel Coronavirus Disease 2019 (COVID–19) pandemic
•Shifts in Federal fiscal, monetary and trade policies
•Changes in business and consumer habits
•Negotiations on State budget appropriations and tax policies
•Inflation
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ECONOMIC
EXPECTATIONS,
INFLATION
•Inflation currently at highest level
since early 1980s
•5-7 rate increases by Federal
Reserve by end of year going into
2023
•Rate increases intended to lower
inflation and moderate consumer
price increases
•Optimism
•Core inflation index increased at
the slowest pace in six months.
•Largest driver of growth in core
inflation over past year, used car
prices, decreased 3.8% from
February to March.
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INFLATIONARY FORECAST, CONTINUED
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ECONOMIC EXPECTATIONS
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ECONOMIC EXPECTATIONS, CONTINUED
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AMERICAN RESCUE PLAN ACT (ARPA)
FUNDS
•July 2021: City received $1,472,232 initial distribution of ARPA
funds
•November 2021: City received $48,212 supplemental
distribution of ARPA funds
•July 2022: City will receive final distribution of $1,520,444
•Initial Plan to use funds on utility infrastructure projects
•City approved resolution to treat funds as replacement of lost
revenue (reporting purposes)
•Gives the City flexibility should there be any unspent funds
or plans change
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LOCAL GOVERNMENT AID
Local Government Aid Allocation, 2018–2026F
$2,000,000
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$-
201820192020202120222023F2024F2025F2026F
General Fund Capital Project Funds
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GENERAL FUND EXPENDITURES
•Personnel Services
•New Labor Agreements Approved in 2022
•Fire Relief
•Police (Patrol & Sergeants)
•Health Insurance Premiums
•Worker’s Compensation Insurance Premiums
•Inflationary Pressures
•Reallocation of current resources based on history and need
•Budget adjusted to better reflect actual expenditures
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OTHER BUDGET/LEVY CONSIDERATIONS
•Issuance of 2022 GO Tax Abatement Bonds for Park System
Improvement Plan
•Property tax impact beginning in 2023
•Springbrook Nature Center
•Liquor Store sales at pre-pandemic levels
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PROPERTY TAX LEVY
P LANNING 2023 B UDGET
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PROPERTY TAX LEVY, NET TAX CAPACITY
Net Tax Capacity by Classification
2%
15%
•Average Residential
Residential Homestead
45%
Homestead, $275,100
1%
Commercial/Industrial
o Current MLS $289,600
Railroad Operations
•Median Residential
Residential, Non-
Homestead: $268,300
Homestead
o Current MLS $290,000
Personal Property
37%
Property Taxes Payable for 2022
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PROPERTY TAX LEVY, DETAIL
Property Tax Levy, 2011–2022
$20,000,000
$18,000,000
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$0
3.85%1.91%5.13%2.30%1.94%3.97%15.75%4.86%4.64%3.97%4.85%2.97%
201120122013201420152016201720182019202020212022
General FundCapital EquipmentI.T. Capital Projects FundSpringbrook Nature CenterDebt Service
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PROPERTY TAX LEVY, COMPARISON
Overall Property Tax Levy, Peer Cities
160.00%
140.00%
120.00%
100.00%
80.00%
60.00%
40.00%
20.00%
0.00%
RichfieldMaplewoodGoldenFridleyNewSavageOakdaleInver GroveCoon Rapids
BrooklynColumbia
CenterHeightsValleyBrightonHeights
CountyCitySchool DistrictSpecial District
Source: Minnesota Department of Revenue, 2021 Property Tax Report (thru the League of Minnesota Cities)
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NEXT STEPS AND
OTHER CONSIDERATIONS
P LANNING 2023 B UDGET
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PROPOSED 2023 BUDGET CALENDAR
May 9Discuss outlooks and objectives with the City Council
June 17Proposed 2023–2027 CIP released to City Council
June 27Discuss Proposed 2023–2027 CIP with City Council
June 30Proposed 2023–2027 CIP submitted to Anoka County for comment
August 8Department of Revenue notifies the City of final State Aid amounts
August 22Discuss Property Tax Levy scenarios with City Council
September 1Department of Revenue notifies City of any property tax levy limits
September 12Discuss Proposed 2023 Budget and Property Tax Levy with City Council
September 26Adopt the Proposed 2023 Budget and Property Tax Levy
September 26Adopt Final Housing and Redevelopment Authority Property Tax Levy
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CITY COUNCIL CONSIDERATIONS
•Based on the current economic conditions and the needs of the
organization, what changes, if any, should the City consider in
budget development process?
•Are there any other budget questions or priorities the City Council
would like to consider?
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THANK YOU! QUESTIONS?
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