City Council - Regular Meeting

No way! You did?

What did you win? Well, I was 10 numbers away from winning the jackpot number, but I won two worry dolls and some pickleball racket. Oh, that's good.

You didn't win any cash? No.

It was for a fundraiser.

Oh, it was for a fundraiser. Okay, gotcha.

I did like a... We were having a good time, so I did a little Ted Lasso dance, and I'd be in a finish like that when they called my number. You don't be dancing.

Do you think Shakopee Pro Hall has cameras? I bet they do, right?

Yeah, they should be able to matter. Did you know the guy who won the 5K for Carver's Team one day was a barber?

I'll give you that one. I see you, Eric. What's up? Eric, can you hear us?

Can't hear any of you.

Oh, that's not great. That's not good.

There we go.

Can you hear us now?

I can.

Okay. How about now? Can you still hear us?

I can.

Okay, great. Okay. Okay. Just in the nick of time. Crisis averted. Just so you know, Christy, your mic is not on. Thank you. You're welcome.

You've saved me. You have saved me enough times. All right.

It is 7 o'clock. I'm going to call this meeting to order. Please join me in the pledge.

I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation, under God, indivisible, with liberty and justice for all.

So if you ever see the reporters pull the earpiece out, it's because they're getting mixed minus. And it's that where they like hear themselves a little bit afterwards. Eric, your voice was like two seconds behind us.

I tried to go a little ahead of you.

I know. I know in the delay. Okay. Let's see. Up first, we have community comment. Or you know what? Let's approve the agenda. I'm sorry. I don't have my agenda out yet.

I'll make a motion to approve the agenda.

Thank you. We have a motion off. I can a 2nd, um, can I get a roll call vote please? I. I. I.

Mayor Johnson?

Aye. Motion passes. All right. We have zero people here with us this evening, so there is no one here for a community comment. We don't have any presentations and reports on the agenda, nor do we have any public hearings. So moving ahead to the consent agenda. Can I get a motion?

I'll make a motion to approve. Excuse me. I'll make a point. Oh, my goodness. I'm going to start over. Go. I would like to make a motion to approve the consent agenda.

I'll 2nd, that's because of the tone of voice.

Okay.

We have a very serious motion from council member Conrad and a 2nd, from council member Pascoe. Any further discussion. All right, can we get another roll call vote? Please?

Hi. Hi. All right.

Aye. Motion passes. All right. We have a business item on the agenda tonight. It is the 2027 preliminary tax levy. Ms. Schutte.

Thank you, Mayor and Council. Tonight we're here to adopt the preliminary levy and certify it to Carver County by the end of September. You have seen multiple presentations of the levy and it has changed each time with suggestions from the council. So tonight I'll be presenting the preliminary levy as it has stood with suggestions from the council. At the end you can have you'll have time to ask questions and then I'll ask for a motion at the end. All right, so The timeline's changed a little bit. So today is September 21st, and we're looking to adopt the preliminary levy. And what that means is we will be certifying the levy at the highest percentage that it can be. It cannot go up from here. It can only go down. And so you can see that December 21st, that will be adopting the final budget and levy that will certify to the Carver County Property Tax Assessor. December 7th is an important date because we'll have our Truth in Taxation. We'll be inviting the residents in sharing our preliminary, well, final, you know, levy and budget and give them an opportunity to speak out on their thoughts and feelings on the budget. So general fund revenues, we are looking at about 4.6 million, and because a lot of our revenue is dependent on property tax revenue, you'll see that about 75% of this circle is made up of property taxes. The next biggest is building permits, and then so on and so forth from there. Because we have to have a balanced budget, you'll see in the next few slides that the expenses will equal exactly what the revenues are. So breaking it down by departments, kind of in sections. So we have building permits, fire contracts and aid, grants and aid, licenses and fees, interest, miscellaneous revenue, and then the total revenue. I did make a note at the bottom that our local government aid has been reduced for 2027 and that is because Carver is growing and it is a calculation that the state Calculates the local government aid and unfortunately the bigger you get the less money you receive from the state so therefore it's common practice to try to not rely on the local government aid for any sort of operations and And then I did also make another note that miscellaneous revenue had been overstated, over budgeted in previous years, and that's why that amount has gone down. But overall, we're looking at about a 7.7% increase in revenues. So 2027 budget impacts for personnel. We're looking at a 3% pay increase and a pay adjustment, and I have the impact at $73,000, a 9% increase for firefighters and officers, and that was due to a compensation study that we had ABDO complete for us and noticed that we were a little below market on some of the paid on-call firefighter pay. So to bring that up over a five-year plan, year one, 2027 will be the first year of that. Overall impact will be about $22,000. Health insurance, don't know what that's going to be yet. I have it budgeted at 15%. And then we are looking at a firefighter pension increase. Right now we're at $5,500 a year in the firefighter pension. And looking to increase that to $6,000 with approval by council later on in the fall. We'll ask for a separate motion on that if council wants to approve that. Community investments. We're looking to do a community survey again. It's been a few years since we've done that. And then, of course, we are ramping up on our 2050 comprehensive plan. And then the Chaska Recreation Partnership. We do have a few budget reductions and that would include Southwest Prime Transit that will be funded by Carver County in 2027 and then the community market will be going away just there's more popular markets in the area and then we will not be doing the on-site IT support by Loeffler that will just be based on tickets and on an as needed basis and that's included with our monthly IT fee.

And with that, that means that whenever I get needlessly and hopelessly stuck and unable to access my email, I can still call them whenever needed. Okay.

That's included in the monthly fee.

Okay. Thank you.

All right, so the general fund expenditures, these are divided into the departments as we talk about. So at the top is public services, and then it goes all the way down to parks and rec and then council. In the middle, we have the police and building inspections. So each of these have their own different types of operating expenditures. A lot of them have their own personnel. A lot of them have increased. There's a couple that have gone down, general governments and buildings. That's where the Southwest Prime was hanging out for the last few years. So that makes up for that difference. And then the Parks and Rec, we took out the farmers market. And again, the balanced budget means that this is increasing by 7.7% as well. This is just another visual for those folks that are visual. You can see that the smaller amount on the top all the way down to public services on the bottom. So for capital levy considerations, one of our strategic initiatives has been to increase our capital capital levy and that is to so that we can pay for cash and not have to bond for capital needs and future infrastructure purchases so it looks like for from 26 to 27 we're increasing it by 13.4 overall percentage points and each we have different categories so we have the street maintenance levy we have general equipment fire capital parks the facilities capital has A couple different purposes. So there's a general facilities, which has a smaller amount for, um, you know, maybe different things around city hall or. The church by the river, but we do have a larger amount in there. Um, that is kind of setting us up for success in the future. Um, so for the last year, we did it for the design and, um. the public services design facilities. And then for next year, we're looking at about $350,000 for turn lanes and What am I? Design, yes, for the public services. And ultimately, I'll get into that, but what that's doing is it's also setting us up for success in planning for a larger debt payment in the future when the public services debt comes online. And that's when we talk about that debt strategy, the debt ladder. that's what that kind of means um so moving on so one part of that capital levy is the 2027 street maintenance and what we have planned is a mill and overlay on overlook drive and overlook lane and a local reclamation on ramsey avenue ramsey bay ramsey court bluff road and Lylewood Parkway South. So as you can remember, there's two pools of money. There's a local street maintenance, and that's what we are levying for. And then there's the Minnesota state aid. And then we get that money from the state. That amount has increased over the last couple of years. It's gone from around $325,000 to, I think we're up to about $425,000 annually that we receive. So this is what I was speaking of just a couple minutes ago, the budget ladder strategy. So we're phasing in that public services facility debt. We are getting ourselves ready. So the budget strategy is attempting to soften impacts connected with a future public services facility. So in 2027, we are budgeting for $350,000 in that facility's capital. And we are going to be using that for the design and the turn lanes. Next in 2028 budget, we are going to levy for $850,000. And we will be using that for another project. And then in 2029, that's when our debt service comes online. And so we have been building up our momentum up to that debt service payment. And in 2029, it will be $1.5 million, hopefully less. This is like worst-case scenario. But this is what that strategy really means. So... This is another portion of what the overall levy involves, and that's our debt service. One strategy we've taken to get down to our overall levy increase for 2027 is by temporarily decreasing the 2013A and the 2015A debt service. We're able to do that because we have some available fund balance in there to temporarily decrease it for 2027. So that's relieving us of $88,000 of debt payments for 2027. We did that same strategy last year. So it does appear that we have a 31% increase in debt service. If we wouldn't have used that strategy last year, we would have had a $1.3 million debt levy. So this would have actually been a reduction to our normal debt service levy. This just shows the gradual increase of the general fund levy history in total, as well as the breakouts. So you can see where we introduced the equipment levy in 2025 as a way to be more transparent to residents. If you recall, when we were saving for any sort of capital, it was more of a transfer. within the general fund to those different areas that needed equipment. So now we're levying for it. We're calling that out. We're saying, here's what we're going to use the money for. And this is showing that we're ending up at a 14.99% levy increase for 2027. And that's what we're presenting tonight. Again, this is just showing that the total levy landing at 6.2 million. That's including all of the capital, all of the debt service and the operating. So the 14.99 levy increase results in an estimated $15.83 monthly property tax increase to the average valued home, which in 2027, the assessor's office is telling us, hey, Carver, your average valued home is $453,700. Last year it was $453,100, just to remind you. So down below, what we're doing is we're showing you the progression of what our meetings have done, the work that the council has done since we started the budget process, the levy process. So you can see in 2026 where we landed, the average valued home, their total tax capacity was $1,928. And then we started draft one and we shared with you a levy that wasn't acceptable to council, and I understand why. We were looking at, I believe it was like 18.89% or something. And now we're at draft number three, and we're presenting a 14.99, which brings us down to a tax rate of 47.27% tax rate. And that is a tax capacity on the average valued home of $2,118. And that gives you... an increase to the average valued home of $190 from last year. This graph is showing the progression of the history of the city of Carver tax rates. A little volatile in some years, but you can see that the overall trend line is a decrease. This slide, I believe Brent shared a couple meetings ago. This is just showing the 2026 tax rate. Also calling out if these cities collect franchise fees or not. And then where Carver falls in this. So in 2026, we were at a 43.10 tax rate. Now with this draft three that I'm presenting to you tonight, we're at 47.27. And then you can see that we're not collecting franchise fees. And what would that opportunity look like if we did? Not sure, but over on the right hand side, we're showing you examples of what other nearby cities are collecting. We always like to show what would our tax bill be represented as a monthly invoice, because we all get a lot of different invoices. And they go up from time to time, and sometimes it's just habit, we just pay them, right? We just pay them and we pay them. But when you're actually calling out each of our services as what they are, sometimes you feel more value. You feel like you're getting more value. The public services, so like plowing and street maintenance and mowing and all of that, $30.23 a month. Capital investments, fire protection for $19, law enforcement for $9. So this is just kind of fun. It's a monthly increase of $14.81. from 2026. So here again, we are looking at the progression of our journey this year with the levy so far, draft one, draft two, and the preliminary levy that I'm presenting you tonight. So we've gone from an 18.92%. We're down at a 14.99%. And as I said before, this will be the highest that our levy can be. We can only go down from here. So we're looking at a $6.2 million overall levy, and that's including everything from general down to capital equipment, street maintenance, and debt service. I always like to share what does that look like on the different values of homes because not everybody lives in an average valued home. In the city of Carver, there's a lot that live in less than and there's a lot that live in more than. And so here I'm sharing homes from the $300,000 to the $500,000. I have them all increasing at the same market value just so that that part is a constant and then you can see what their increase or decrease would be obviously all increasing for 2027 and then what their actual tax was for 2026. And that's all I have. I'm happy to take questions. Brent is always good to add some more detailed context. But what we need to do tonight is certify the preliminary levy. I believe there's a resolution in there.

Great. Thank you. All right. Any questions, comments, or a motion?

I have a quick comment and a question. Go ahead. On slide 16, Maybe it just sticks out more at me, but I really like seeing what the other cities collected for franchise fees. So thank you. And then I do have a question on the planning when it comes to the 2050 comprehensive planning. Do we anticipate in budget 2028 having a line item to help fund that work or should we have that all wrapped up by then?

I don't know the detailed amount, council members here, but we should anticipate additional services for the comp plan for the 2028 budget.

Okay.

And we have $43,000 for 2027. Correct. Okay.

And there's a variety of, so that's just the general fund portion. You'll see in the enterprise fund budgets for the water and sanitary sewer planning, there'll be budget allocations for those scopes as well.

Okay. Nice. Thank you.

CHRISTINE, ANYTHING? I JUST WANT TO COMMENT, AND COURTNEY, I KNOW YOU USUALLY DO THIS AT THE END, SO IF ANYONE IS WATCHING, THIS ISN'T THE FIRST TIME THAT WE HAVE.

I WAS LITERALLY TAKING NOTES. I THINK THIS IS THE FOURTH TIME THAT WE'VE SEEN THIS.

SO IF IT FEELS LIKE COUNCIL ISN'T HAVING A LOT OF DISCUSSION, IT'S BECAUSE IF YOU LOOK BACK TO SLIDE 18, YOU SEE DRAFT 1, DRAFT 2, DRAFT 3. SO WE HAVE BEEN WORKING Very diligently on this, it's not done. I mean, we're waiting on health insurance to come in yet and to know what those numbers are going to be. Um, as it's been stated many times, this is the highest only set this preliminary level. So, um. Thank you for all of the information again, and working so hard on this everyone. Um, and then I just wanted to make that note that council doesn't just shove this into on the shelf now until we hit December. So that's not how this works. So, um. I don't have any other questions besides that, because they've all been answered in the last 4 other times.

No comments. Eric.

Can you hear me? Okay. No, I, again, I'm glad you brought that up. Christie, the number of times that we've been through this, but again, too, I want to thank city staff. A lot of hard work goes into taking feedback from council and coming up. with a lower preliminary levy than we thought we might have. I know we've got one big outstanding bill with healthcare and we'll hope that that is favorable for us, but thank you for all the work in bringing us to the point we are today.

Thanks, Eric. My one question, Brent, in your update, you said that we were coming in under what we predicted for building permits for 2026. Yes. As we look at our 2027 budget and as we're in the only place that we are tonight to set an amount that we won't go any higher than, do we need to keep that in mind or will that affect our reserves or is there anything that we need to be thinking about additionally tonight as we do this?

I would say it could impact the reserves. I'm taking all your questions as kind of rhetorical. I mean, any one of those things could happen. I would say the response from the council is a policy decision on if you choose to make a different choice because of that information. There have been cases where builders have come in in December with. You know, 2 fistfuls of permits, because they want to get in on that year's fees. And so under that scenario, you could very well be fine. As Lynn mentioned, the building permit revenues are the most temperamental part of the annual budget going back. Decades, because it's, I would say it's the most link to what. You know, market conditions are, and, um, other factors that aren't really in the city's control. So, um, with that, I would. Offer that that condition will likely exist going into the 2027 budget and for the console to use that information in whatever way you think is necessary to make the best budget you think is appropriate.

And we can make a policy decision to not. Fully fund our reserves. We're not looking necessarily at a 100,000 dollar hole here.

I mean, the, the, the. I wouldn't clarify classify it as a policy. This is a policy decision is on the budget on what you adopt the budget. Your fund balance policy says you'll keep a 40% fund balance. That's 40% correct. Um, if we, for whatever reason end up being short of that, there's, we have had that in the past and then the following year, we make. Decisions to try to replenish that, um, there have been choices in the past to, um. Scale back on revenue projections for that and so there's kind of a handful of many consequences then to that. If you peel back on building permit revenues estimated for 2027, which we feel like are are good. Uh, you'd either have to make budget cuts or revenue ads. So there's kind of a, you know, if you kind of tailor what specific question, or where you want to go with that, I can probably provide you with some better detail.

Okay. Okay. I'm not in a place to tailor the question right now, but I was just curious kind of what we're looking at and what that means. So, thank you.

I'm sorry.

No, I was just going to just like, Christy already mentioned it, but for the tens and tens of people who are watching at home online or will be watching us in the coming weeks and days, we do tend to have our eyes glaze over, I think, a little bit because this was literally, in addition to the preview that we got on June 1st, this is the third time we've heard this budget.

So, we...

If something happens to Lynn, if that 2 headed Billy goat eats her, we can absolutely step in and probably do the presentation. Not as well necessarily carry over from work session that we're talking about disaster scenarios.

So, okay, go ahead. I just have, if we go to page or slide 4, so at the top there for property tax revenue. So I hear a lot from. lot from residents saying we have all these new houses when is it gonna hit when are we gonna see this so if I I just want to make sure that I'm if I breathe this the right way that it's coming out the right way and it's fair for me to say so the property tax revenue has gone up almost 11% so we are starting we've seen 11% higher coming in on our revenues from the new And existing homes, I mean, what is the, how should I characterize that?

Yeah, the revenue you see in that chart is just a revenue compare like. You're asking for a certain amount, so just to put it in, like, ground numbers, let's say we needed a 1000 dollars and it was going to go up. You know, a certain percent in this year you need 1500 dollars. That. $1,500 gets spread to all the homes. So this table doesn't represent like just the new homes or what they're contributing. It's a math problem in reverse, meaning that we need this amount and it's divided by this many houses. And then that amount and number of houses changes from year to year. I would offer, I'm gonna, Push the council to slide, um. 15, and I kind of reference this there was a council member had asked me earlier in the day for some previous budget information. And there was a 2013, we landed on a 2013 budget and the city's tax rate was like 57%. So. You know, if you can kind of visually place 57% on that graph, you can see that there is a line kind of going down as the city's population was increasing and then with kind of most things. 2019, the city built city hall and it went up and it started tracking down and it kind of started leveling off and you'll see in the next year that 10 year plan on October 5th, there's going to be a spike. I think it's right around 52 or 53%. If you follow your current strategy for public funding, public services, and then. Uh, by the time you get 10 years out, it drops back into the mid thirties. And so it's that ebb and flow of when you choose to invest. But. If you go to, um, if you want to go to the city slide there, it's not. It's not by accident that, you know, Chaska Chan and Victoria are the 3 lowest cities by tax rate. I would offer mayor as a little bit of an anomaly, but it, it follows the population and there isn't any reason to think that. You know, outside of when the city council, the community chooses to invest in, I would say a generational public infrastructure. You'll see that spike, but there isn't anything that's telling us that we shouldn't continue to drop once that. Uh, if and when that investment is made, and then as a population increases, because they'll, they'll be more. Is it at a rate that everyone probably wants to see and can we can quantify in this year? You'll pay this much less. No, but the data tells us history tells us that that's the reality. Um, and this table embodies that.

Okay. Thank you. I just want to make sure I'm handling information correctly. And there's a lot of numbers in here, so I appreciate that. Thank you.

Any other questions or a motion? No, guys.

Well, I'd make a motion if I had it in front of me, but I think the motion is to certify the preliminary 2027 tax levy, correct?

In the amount of $6,211,400. Yeah, $400. So, I think that's the motion I heard make the motion and a, okay, we have a motion by parchment.

I'll 2nd, the motion to adopt this resolution 145 dash 26 and a 2nd, by Sarah any further discussion.

Can we get a roll call vote? Please?

No. I. I. I.

i i'm glad i'm not the only one that's likely um okay motion passes for one uh with council member uh pasco voting against it all right um up next we have communications monthly reports i don't know that there's anything for council on that um so i think council communications all right i don't have anything tonight christy

I JUST WANTED TO SAY THANK YOU TO EVERYONE OF CITY STAFF. TIM WALSH LEFT HERE. SO CITY STAFF, CITY FIRE, OUR LOCAL POLICE AGENCY FOR ALL OF THEIR HELP DURING STEAMBOAT DAYS. IT'S GREATLY APPRECIATED. THIS WAS A VERY SMOOTH YEAR. I'M KNOCKING ON WOOD BEHIND HERE. BUT IT REALLY WAS. AGAIN, AFTER YOU DO THIS, YOU KIND OF START TO NAIL DOWN THINGS AND SEE WHERE YOUR GAPS ARE. public services and Andrew thank you very helpful and your staff was very very helpful Brent obviously you as the city manager help with this all all this you know thank you for that and then Brenda and and the other staff the administrative staff is really helpful too because there's a last minute we need this and it happens please laminate if I have to I don't ever want to see them laminated again because I feel like all I ask is like please laminate this Please laminate this. But it is. It's a city celebration. It's run by volunteers. It's run by our staff. And it's great for our community. So it's nice to help or to see everyone come together at one time. Let's see. Do I have anything else besides all that feel-goody stuff here? I don't think so. Kayla? No. Eric. Eric.

I do.

So I want to recognize Council Member Christy Conrad as being one of the biggest volunteer efforts for Carver Steamboat Days. I don't know that it would go off as smoothly without all of the effort and time that you put into this. I know how dedicated you are to making this a great event for the city and everybody in it. So thank you for all your effort.

Thank you, Eric. I appreciate that.

All right. I will jump on the bandwagon of saying Steamboat Days is always so, so much fun. And you do such a great job living your best life, yelling at people to move their cars. I ran into Christine. She's driving the four-wheeler. If you're a license plate, it's this.

I'm like, oh, you're living your best life right now, aren't you? She said she wasn't.

But it's so much fun. And I think you probably heard me say this before, but I feel like the Monday after Steamboat Days is the Monday-est Monday of them all. And there's just this, like, Steamboat Days hangover. And not in an, I was over-served kind of way. Just in a, like, oh, that was a really fun weekend. You know, where it's just the crash. It's like a sugar crash, you know. So thank you so much for that. During Steamboat Days, I had the opportunity to use cover insurances. confetti cannon to start the 5k um which went flawlessly i was worried it was gonna go three two one One. But it went just fine. Had mayor's office hours, had about a dozen folks with a dozen different reasons for coming and visiting. Last week on September 16th, I went to a Ganesh celebration in the Hawthorne Ridge neighborhood. Ganesh is the celebration of the Hindu god of wisdom, new beginnings, and the removal of obstacles. So that was a new opportunity for me and very cool to see. Last week on the 17th, Tom Emmer has his monthly meeting that I think we're all invited to get updates from them. On Friday, we had the business alliance, which is probably our longest meeting ever, but for a good reason, because we heard updates on not only the public services project, but also the levy project. And as I kind of mentioned a little bit earlier, All of the feedback was overwhelmingly positive and lots of really good questions like. Did you explore other options? And Brent took us to the Wayback Machine when we were looking at expanding to that piece of property next to the fire station and kind of went through that process and explained things really, really well. But overall, folks were like, we just really appreciate the transparency. This is cool that we're getting a seat at the table to hear this and to give you guys feedback. And Brent is also really good. And I saw that he did this at the last week's planning commission, too, where his last question is always, So thank you for the feedback. Is there anything that we're missing? Is there anything that we are too close to this project that we are not seeing? And we've gotten some really good responses on that. So that was fantastic. On Saturday, I was invited and participated in Oktoberfest in the Preserve neighborhood. Tony and Jenna Lotzer participated. I might be saying their last name wrong. But had a kind of a progressive party throughout the neighborhood. And there was keg throwing and a wiener toss and apple bobbing. And it was... Quite the event. Tony was in a costume of a stein. There was a stein holding contest. And then on yesterday, I did my semi-annual hike to the Cheese Cave. I always do that the Sunday after Steamboat Days and then on Earth Day. And then visited Carver Ridge to have snacks and conversation with the mayor. So lots of good questions from those folks, too. Looking ahead, it's going to continue to be a busy week tomorrow night at 6 o'clock is the county commissioners forum. And then at 7 o'clock is the sheriff's forum. And then Friday is the fire department's golf tournament. So that is it for me with that. I would entertain a motion to adjourn.

I'll make a motion to adjourn.

Thank you. Motion by comrade. I'll second. Second by Pascoe. Any further discussion? I don't need to say that. Okay. Can we get a roll call, please? Aye.

Council Member Conrad?

Aye.

Council Member Sayer?

Aye.

Council Member Hirschman?

Aye.

Mayor Johnson?

Aye. Motion carries. Good evening.