Special City Council Meeting Minutes-February 26, 2018

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Madrid City Council
Special Meeting-Budget
February 26, 2018
5:30 p.m.

The City Council meeting was called to order at 5:30 p.m. with Mayor Dirk Ringgenberg presiding.

Present at Roll Call: Nate Samples, Kurt Kruse, Val Chapman, Dave Cook and Lane Shaver.

Other City Officials Present: City Clerk Mary Jo Reese

Motion by Councilperson Shaver, seconded by Councilperson Kruse to approve the agenda for February 26, 2018.
Ayes: All Present                                                                 Motion Carried

City Clerk Mary Jo Reese discussed the budget for FY 18-19 advising the Council of the notice that will go to the newspaper setting a public hearing for the budget for March 12th at 5:00. Reese also noted there will be no change in property tax for the upcoming fiscal year. Property valuations increased, giving the city higher amounts of tax dollars for FY 18-19. Reese pointed out that there will be an increase in the amount of levy for employee benefits, as the proper amount has not been levied in the past. Liabilities for insurance and workmen’s compensation insurance have always been paid from the general fund instead of the appropriate departments. Reese discussed commercial property tax backfill and stated that the budget was prepared while anticipating 85% backfill from the state. Some funds will be lost if that percentage is not received. Reese reviewed the cash balance for the city as of June 30, 2017 per the audit report, and what the anticipated cash balance will be at the end of 2018, and 2019. Some changes since the FY 17-18 budget include separating Local Option Sales Tax, (LOST) from the general fund, transferring money from the general fund to start the Storm Water Utility, transferred money from an unused capital projects fund to water to help pay for the water tower maintenance work. The Council will be asked to approve a transfer resolution in the upcoming weeks.

The water fund continues to run in a deficit. Water rates will need to be increased 10% and the Sewer fund by 5% on July 1, 2018. Water will need to be increased another 10% on January 1, 2019. The Council discussed bonding issues, and how the city’s bond rating was lowered due to lack of water revenues. All capital projects requested by Public Works Director Scott Church are included within the budget. The city will not be borrowing any funds during the next fiscal year.

Mayor Ringgenberg mentioned that in the future employees may be responsible for paying a portion of their health insurance premium.

Motion by Councilperson Cook, seconded by Councilperson Samples to approve the budget for FY 18-19.
Ayes: All Present                                                                 Motion Carried

Motion by Councilperson Shaver, seconded by Councilperson Kruse to set the public hearing for the FY 18-19 budget for March 12th at 5:00.
Ayes: All Present                                                                 Motion Carried

Motion by Councilperson Shaver, seconded by Councilperson Kruse to adjourn the meeting at 5:25 p.m.