Finance & Personnel Committee - Regular Meeting

Good evening. We're gonna call, to order the finance and personnel committee at, 6PM. All members of the finance and personnel committee are present except for Roseanne Northwood. And with that she's excused, by the way. With that, we will start with new business.

Item number two six dash zero two zero four, resolution dedicating city property Lot 42 of six hours addition to the public for right of way purposes and approving request from Badger Corrugating Company to vacate a portion thereof. This is open for public hearing. Does anyone wish to speak? Council member Jansen?

Move to approve.

Motion to approve by council member Jansen, second by council member Newberry. Any discussion? Seeing none, we'll move forward with the vote. And that passes unanimously. Next item of business, 26 dash zero two three eight, resolution allocating unused sanitary sewer funds for the final payment on the wastewater treatment plant upgrades.

Council member Jansen.

Move to approve.

Motion to approve by council member Jansen. Second by council member Kahlo. Any discussion? Seeing none, we'll move to the vote. And that passes unanimously.

Next agenda item is 26 dash zero two five eight, resolution appropriating tax incremental district TID 11 funds for the design and construction of a rectangular rapid flashing beacon, RRFB, across Highway 1461 as part of the Wagon Wheel Trail project. Council member Jansen.

I would move to approve.

Motion to approve by council member Jansen, second by council member Kahlo. Council member Jansen? I'd

appreciate if staff wanted to just kind of, talk about this a little bit more and, maybe describe why that particular location was chosen.

I could do that. Council Council member member Jansen. Okay. So do you want a little background or just why the location? Okay.

So this is related to the Wagon Wheel Trail project. If you're not familiar with that, that is a grant that we've gotten, a TAP grant from the GOT to widen and improve the sidewalk from the western landing of the blue bridges along and then travel on the North Side or the East Side of Highway 1461 along Pedynebone Park and then extend all the way towards Minnesota where once you hit the West Channel, Mississippi West Channel where we have a majority of the grounds going is for a separated bicycle and pedestrian bridge to cross that and then connect up to where the landing is over in Minnesota. So part of the design of all of that was removing an existing curb ramp near the intersection of where you enter the Petty Bone Park. The DOT did not like that. They had said by state statutes and some of their other policies that because there's a sidewalk on the other side of 1461, we either needed to maintain that crosswalk there, or we could put in some other crossing, like a rapid flashing beacon somewhere else in that general vicinity because the one to the north is too far away.

So we need to just still maintain some sort of crossing in that general location. And talking with, engineering staff, we prefer to do the rapid flashing beacon as that would be much safer to install, for pedestrians to cross rather than just trying to paint something in the road and then have the curb ramps there. This would be obviously, people are gonna see the lights flashing when they start crossing. Additionally, we moved a little further south too just in anticipation of the fact that a vacant lot over there is intended to be redeveloped with a lot of housing and residential. And so we were it was just sort of a staff consultation if that's what we prefer to do.

It'd be safer. That location would make more sense and it does keep that distance from the other one. And then it was just what we decided we'd like

to pursue rather than have it just

to paint a cross mark.

So the DOT is not actually opposed to, like, the RF flashing beacon?

No. They gave us that option. They said either put in a better crosswalk of where it is now, or you can do a rapid flashing beacon that'll also meet our requirements somewhere in that general area. And so we chose to to do that after talking with engineering. That was the preferred method.

Thanks for that clarification. Because if the public were reading the the documents online, they may have misperceived that like I did.

Okay. My apologies. Documents that I wrote, like my staff report and stuff, or was it something that we did that I could maybe correct? Or

Maybe I just read the staff report too fast.

Okay. Okay. Sorry.

Mister Ecklin, I'm I don't know if this matters or anything, but you're asking I'm sorry, council member Newbery. Please go ahead. Thank you. On the, staff report, it says the resolution is is appropriating tax incremental district 11.

Yes.

And then down under the fiscal impact, it's as it's talking about utilizing funding from TID seventeen?

Yes. I had that corrected. That was brought to my attention this afternoon, and I went up to Sandra, our deputy clerk, and she changed it. It came up as 11 for me now when I click on the staff report, so I did have it changed this afternoon. So it was fairly recent, but, yes, that was brought to my attention. Thank you, council member Calo. And I had that changed, so thank you for that.

Thank you. Appreciate it. Council member Newberry.

Thank you. Tim, what the I may have missed it. And if I did, I'm sorry when you were talking. The when did the DOT like, what was the timeline? When did they bring this to your attention that this was gonna be required?

It was with a discussion. So the plans that we had submitted for their approval because because it's a grant with them, we have so many stages of plan approval. It was brought to our consultant. We'd hired SCH to do a lot of that coordination with us and the development of the plans. I think it was brought to their attention towards the end of last year, and it was just us trying to figure out the solution of what we wanted to do and get confirmation of what they would be approval proving for us and then just getting the legislation together and identifying funding of where we come from to see if we could do that and then getting the legislation in.

So it was within the last several months that it all kinda came together that we really needed to figure out a different way to do this. Okay. Thank you. Yeah.

Councilmember Kahlo.

Thank you, madam chair. Real quick. So because we had extensive education on TIDs and TID 11 last month, this is not in TID 11, correct, But because it's within the half mile radius, that money can be used, and then we don't have to use borrowed funds. Correct?

Is correct. Yes. The boundary goes literally, it ends right This is off of it's close

to the border. Very

close. Yes. Which is also, I guess, to answer councilperson Jansen's question earlier about location is we wanted to make it a little further south in the road, so it did fall within the tip. That was also part of the consideration of why it's a little further south.

Okay. Thank you. Yep. Councilmember Newberry?

Any other discussion? Thank you, mister Acklin. Thank you. We'll move forward with the vote. And that motion passes unanimously. Next item up is 26 dash zero two seven six. Resolution appropriating tax incremental district ten eleven funds for the Civic Center Park. Council member McKaylo.

Motion to adopt.

Motion to adopt by councilmember Kalow, second by councilmember Newberry. Councilmember Newberry.

I I would just like to ask staff to kinda give us a report on this. Mister Flatmeyer?

Good evening. Civic Center Park was originally called out in the twenty twenty nine CIP using general bonded money. And with the opportunity to use TIT 11 money, we thought it would be a great time to move it to 2026. We can get it under contract by October. The park was built late seventies, early eighties, so it needs some upgrading. And and that was the whole idea behind it is to get it away from general bond into TID funding.

Do you have what are the plans specifically for the the funding?

I would call it upgrading to the lighting, upgrading to some of the patio areas, upgrading to the fountains. You are it's not gonna substantially change that park, but it just needs some TLC to kinda bring it back up to where it used to be. It's a great thoroughfare from Main Street straight down. So make it more enhance it, you know, make it a better spot.

Okay. Thank you. That's all the questions I have, for mister Flotmeyer, but I would like to ask, director Hawkins questions. But I'm going

to wait if Councilmember Jansen.

Could you so is it more maintenance items then that you're doing?

I would say it's a combination. There's some sidewalk that's got to be fixed. There's one of the big patios to the west that's gotta be torn up and redone. The lighting's gotta be upgraded. I would clear I would call

it an upgrade versus maintenance. And are those lights on their own meters? So are we just paying a set fee for for the lighting that's down there

on those poles? Don't know the answer to that.

I would love to see if if we are gonna be changing some lights, if we could make it so that we could save some money if it is on a meter potentially?

Yeah. I I know there's talk if they're not LED to get them to LED.

Thank you, mister Flatmire.

You're welcome.

Council Member Munohiri.

Doctor. Hawkins, I have a couple questions for you. Hi. My my questions are around the the CIP process, and this is probably the first time in the cycle. Can you jog my memory how it typically goes in a in a year?

So our CIP process typically starts, again, sometime around that mid to late December timeframe, where we open up our portal to staff to start entering their request for equipment and projects. Right now, we have already completed the equipment piece of it. Right now, we are currently in the project phase. So we have started our one on one meetings with departments, finance staff and the mayor to discuss the projects that have been presented for 2027. At some point, we will compile all of that.

It will go in front of the City Plan Commission for public hearings. And eventually, the entire capital improvement plan will be presented and adopted in August for August cycle for 2027 projects.

Okay. And that's a it's a five year projection, and things change every year, but that's the idea. The when who does the who does the how does the prioritization work of each of the projects and the equipment? Purchasing? Is that the I'm sorry, the commission? Or is that staff? How does that work?

So prior to me starting here, finance had proposed a different process that was vetted and approved by the past counsel. What we do is we get together kind of as a team. Each department well, not every department participates, but most departments participate in kind of a ranking scoring system. And that compiles a score so that when we start looking at what our debt ceilings are, where we want to be in a year, we can start plugging those projects into the capacity that we have for what our debt limits are based on those scoring criteria that was again set by the council after our scoring team goes. And that's kind of what we use to present the first initial draft to CPC and eventually the council.

Doesn't mean that that's how that's gonna to stay. There certainly can be a lot of moving parts after the presented pieces. But it gets a good start to the process to make sure that it's as fair and equitable as possible to present something. Because there have been plenty of years where if we were to present all of the projects that needed to be done, we'd be looking at 30,000,040 million dollars at some time. So there has to be a way to kind of bring that down to where we can comfortably bond for every year.

So that process, I thought, was, again, I didn't start it, but it certainly is a good process. I think that that keeps things fair and equitable for us to develop the draft that is eventually presented to you and the public.

Okay. And then my last question is that the ten eleven is what we're talking about. Right? And it has money. We've talked about it a couple times recently in the last couple months, and it closes soon. That's my question. When does it close?

Closes in October.

Okay. And what happens to it if we don't spend it?

Well, it'll continue to generate tax increment for five years after that. It's just any new projects cannot be started or completed unless they're under contract by that TID close date of October. And that's kind of the purpose of this. If we were to use, like Jim had mentioned, in order to get this project done, this with TID money, we need to get it under contract this year. Otherwise, we'll be looking at a request in the CIP in an out year utilizing general bonded funds.

So the idea is to get this under contract by October so we can utilize the funds that the increment or that the TID is generating through the increment, if that makes sense.

It does. It doesn't quite answer the question. What just what happens to it if we don't spend it? It keeps generating funds, but where does that money go?

Oh, if at the end, there are leftover funds and those those funds then get redistributed back to all the taxing jurisdictions. So school district, county, we keep a portion of it.

Sure. Okay.

I think

Whatever is left at the end of that five year period. Okay.

Thank you.

Councilmember Jansen.

I just have a follow-up. It's my understanding that we have the option to actually have those leftover funds be donor fund to another TID?

That's correct. That's correct.

TID 17.

That would be one of them, I believe. Right? No. Nope. Just TID 18. Sorry. That

one. Thank you, miss Emily. Council member Liz Nicole.

Thank you, chair. Can you hear me okay?

Yes. We can. Thank you.

This question is for mister Flotmeyer.

Question is, sir.

Has in in coming up with the estimate for this, was how was the design brought or created or brought about? Was there it's actually brought through, you know, a designer? Was it done as a combination of engineering and parks? How did you decide as to what will be done with those funds related to type of lighting, type of landscaping, that sort of thing?

We have just begun the design process because without these funds allocated, there's no way to pay for that design process. So we've met with the architect who's going to be doing the work on this just to talk over some ideas and some back and forth. And once these, dollars have been allocated, then we can, do the deep dive into what really is going to happen and get the, the bid docs ready to go. But with the upgrades, there's not a ton of work to do. It's more just what we're going to upgrade.

Do you have a sense on the cost of the design out of that funding?

I don't have that number yet because I don't have money to allocate to it. Normally, with, we're using Zettler design for this. I'm gonna guess just the design piece is gonna come in. I'm gonna guess 5,000 to 10,000, then depending on what we do with construction administration and bid docs. But I'll bet the design piece comes in 5,000 to 10,000.

Thank you.

Any further questions or discussion? Councilmember McKaylo.

Thank you, Madam Chair. I don't have a question for you, Jim. Thank you. You know, I had a lot of questions about this project, too, because, of course, it was set out to 2029. So I met with Park staff, and we walked it and talked about some of the upgrades and sort of a vision for the future. Right now, there's, I think if I'm getting it wrong, it's first or fourth Fridays. In the summer, there's art there. So we're trying to utilize that space and upgrade it a little bit. There are bricks in areas that are again, I've said trip hazards. Tree roots are sticking up, it's a little dangerous.

So where I was a little ambivalent, I am 100% now supportive of this, And knowing that we can use TID money and not borrow and cost the taxpayers additional funds, I think, is a really important way to go. Thank you.

Thank you. Any other discussion? Seeing none, we'll move forward with the vote. And that passes, four to one. Moving on to, item number 26 dash zero two eight nine, resolution regarding the administration and financial maintenance of American Rescue Plan Act, ARPA funds received by the city.

Council member Jansen. Move to approve. Move to approve by council member Jansen, second by council member Newberry. Any discussion? Council member Jansen. I think it would

be important to have staff come up and just talk about this and and and explain it in, real understandable terms. Okay.

We'll try it with that. So we are in our final year of ARPA, as a reminder. So we are doing our best to just do the administrative components of wrapping things up and getting all things in order. We do have a handful of projects that have come in under budget that are complete or some that we are anticipating to come in under budget as we're working through the projects. And so what this resolution does is it reallocates those funds and applies them to other sources.

When we were working through this and planning with the finance department, our goal was to try to get it to projects or to get it reallocated to funding sources that would come with a lesser amount of restrictions or that would be a benefit to the city. Of course, the Department of Treasury is pretty restrictive on what the funds can go to if you're going to reallocate. There's more to it, but in the simplest terms, one of the allowable uses is if you can reallocate funds to a project that was under contract or underway by 12/31/2024 if it would have otherwise been ARPA eligible. So we were looking through projects that we could have funded with ARPA but we didn't that came from a funding source that met those qualifications. So we were looking at not to be just candid, the operating budget is we could kind of get money into the general funds since that was a that's a fund that has doesn't have restrictions on it.

And then also one of the the buckets of funds was ARPA interest funds. So as two example projects, the airport fire truck was paid for with ARPA interest funds that was approved by council, so is the zoning code update. And so those were two projects that could have been funded by ARPA. So what essentially we did with those projects is or what we're seeking to do, I should say, is we're looking to have those now get moved up into the ARPA expenses and then the funds to get reallocated into essentially replenish that pot of ARPA interest funds. And then the other two items that we we flagged were with was the zoning code that was paid for that's referenced in in my staff report, then that would put money into the general fund and then also towards a ARPA administrative expenses.

So for staff that have been working on ARPA related projects that are otherwise getting funded by the the operating budget, their salaries, we are using that money then to kind of offset that so then that money will go in the general fund, which then will come before you again, of course, once the operating budget comes through again. Am I correct on that? So hopefully that addresses and there are okay. I should add, there's just a couple other things on there. A couple of the projects do have, like the parenting place that will reduce their contract, and so there is the amendment that's added to this as well as the NLBA, the North La Crosse Business Association. It also adjusts their contract, their project that was funded. It it actually extends the time a little bit for them to finish up their project by June.

Councilmember Jansen. Thank you, Julie,

for that explanation. And I just need a a really clear clarification. So each of these different pots of money that we're moving money to, the the city council will be approving any of that money and how it's spent?

Yes. But director Hawkins, correct. It's like, that is correct.

Yes. This is adjusting that, but any

of the Could you grab a microphone, please?

Yes certainly, so most the transfer right now has already been through the council cycle right, I mean we're that's what kind of what this is doing but all of the ARPA interest that those dollars will have to come back through council one way or the other through resolution or something before we can spend those interest funds.

Including money that went just to the general fund?

Go ahead. I say yes because that goes through the operating budget. But that's your wheelhouse only.

Yes. Yes.

The ARP my understanding too in working with finance when we were talking about this, and I worked a lot with Dan DeGear with on this, but the ARP interest funds would require a council resolution. It would go before you to get approved, so those dollars should not be spent without your approval. And then the same thing goes for the operating budget funds as well. So these will replenish the general fund, which you'll see through the next. You should see the next operating cycle our budget operating budget cycle.

Yeah. So just one more clarification then. These are, like, planning department projects that you supervise, so we shall be anticipating other departments to come forward with similar resolutions? Resolutions?

I suspect, yes. I don't know for sure what you'll have to see, but I think so. We I know we've been asking about that too.

I have a question about the NLBA project. Is there that this has been moved out to 06/30/2026. That's kind of a short it's not a lot of time. Is there any benchmarks or in place that are to keep this project on time?

Yes. So as part of ARPA projects altogether, quarterly reporting is required. It's required of us from the federal government, so that's regularly submitted. And then we apply even further level of monitoring on the projects. Of course, when they are struggling, then we get a little bit more involved. So I can say with the NLBA project, we're in regular communication and they're required to submit monthly reports for their budgets. So I know I'm actually, my intern's been working on April 1. We said send us your March numbers right now. We've been very clear. We've had them submit multiple, projections too for when they will spend these funds, and I have made I have made very clear too that if these don't get spent by June 30, we'll reallocate those again.

So we are on monthly reporting in addition to the quarterly reports. I appreciate all the time and effort you've

put into that. Thank you. Yes, of course. Any other discussion? Seeing none, move on to the vote.

And that vote passes unanimously five to zero. Next topic is 26 dash zero three zero one, resolution approving the carryover of unexpended unexpended appropriations for the Arts Board from the 2025 operating budget to the 2026 operating budget. Councilmember McKaylo. Motion to adopt by council member Kahlo, second by council member Newberry. Council member Jansen.

I'd appreciate if staff wanted to kinda just explain how we got to this point.

Thank you, council member Jansen. Janssen. This money was allocated in May to the library mural project. The official design wasn't approved until October, which didn't leave a lot of time. So standard procedures for ArtsBoard is you do a deposit, and then you do the final payment once the project is completed.

Due to the timeline of when this was approved, didn't leave a lot of time for her to do the mural. We meet monthly with finance with our department, and I had asked a few months in a row kind of, you know, seeing that this was gonna happen, end of year, I know what happens to the money. They said the procedure is financed as a resolution for the April cycle for the carryover funds. I asked every month just to make sure we were on top of it, and I emailed late February to confirm if they needed anything from me for the resolution. At that time, I was informed that finance was not going to support carryover, so it was our department's directive to no longer proceed internally, but that if a council member wanted to proceed, they could.

Thank you, Kate. Has this happened very often in the past you've been working with ArtsBoard? There was one other time

that ArtsBoard did have carryover, and that was back in 2022 for the 2021, operating budget. So I knew that it had been done. Thank you.

Any other discussion? We'll move forward. Thank you, Kate. We'll move forward with the vote. This motion passes unanimously.

Moving on to item No. 20 six-three 14, resolution approving the carryover of unexpended appropriations from the 2025 operating budget to the 2026 operating budget and the 2025 year end budget adjustments for department cost overruns. Councilmember Jansen.

Move to approve.

Council member or motion to approve by councilmember Jansen, second by councilmember Kalow. Is there any discussion? Councilmember Jansen.

I'd love to hear from each of the departments how they came up with staying under budget versus those that their budgets appear to have gone over. No particular order.

Thank you, Council Member Janssen. For the HR department, we, were under our operating budget by $61,000 in talking with finance, we believe that was related to in late twenty twenty four, early twenty twenty five, the council had approved reclassifying

one

of my positions from a senior HR generalist to an HR generalist, which brought that down, I believe, to pay grades. We also had a vacancy in the department for three months while we were filling that role and recruiting for it. And then we had another position that became vacant due to a retirement, and that person was hired at a lower pay step in that pay grade. So we believe that is what it's related to, or what's been shared from finance? Thank you.

So for the police department's budget, this resolution is frustrating for me. The resolution would essentially make it seem as if the police department didn't stay within the confines of our budget, which I really don't believe is accurate. And there may be explanations for that, from our finance department, but, based on what is placed in the resolution, there is some additional information that, you know, I would like this committee to to at least know in terms of how I, as a department head or police chief, and our department works through the funding mechanism through our municipal budget. So for 2025, coming into those budget meetings and and moving forward with how our budget was going to look for that year, we agreed to hold three officer positions open for the 2025 budget. Now at that same time, we were still trying to fill staffing positions.

We had been trying to fill staffing positions for quite some time. As a matter of fact, since I became chief in 2019, with the exception of maybe three months, we had never been fully staffed. So in 2025, we averaged seven open positions. However, when the year came to an end, we came into the beginning of '26 and started to look back on our budget. Showed that we had used over 100% of our salary and wages.

That, to me, just apples to apples comparison did not seem to be accurate because we had those open positions. Rough numbers, seven open positions would be about $750,000 In addition to that, with salaries and wages, throughout the year, there are a variety of different payouts that come through that line item. So for instance, our canine officers have some premium pay because they take care of their canines outside of, work time and and that sort of thing. There's holiday pay for people who are working on holidays. And so throughout the year, that those payments come out of salaries and wages as we pay those out to our personnel.

That totaled $432,742.2 We learned in the first quarter of this year, '26, that that money was never put into our budget. In addition to that, for several years, we have been budgeted $260,000 for overtime. We spend more than that every year. We have asked since I've been chief to have a more accurate number presented in our budget to accurately show what it costs to simply provide public safety to this community, but that has not been the case. 2023, we had $489,416.75 in overtime.

2024, it was just over $503,000. In 2025, it was $521,404.86. However, our line item was only 260,000. I mean, I'm I'm set up to fail in my budget. Now one thing in addition to that, I don't have a whole lot of control over salaries and wages.

Overtime happens for a lot of different reasons. As you've heard before as a committee, one being is that within public safety, we just can't go home when something's happening. If you followed social media, we had a six year old missing this evening. Our officers don't go home at their end of their shift when they're working that call. We do have control over an item, line item that is essentially just kind of the cost of running the police department day to day.

Just like anybody has costs, we have costs to keep the lights on and, other sorts of expenses, some of our contracted expenses and that sort of thing. That line item was $938,000 $938,094. However, we only spent $765,478. So what we had control over, we saved a $171,615. One last thing is that this has been a practice, but it should be known that the practice is that we don't have the ability to budget for severance.

And as all of you know, and I've been talking to about it for a long time, 2025 was a tough year for us in terms of, succession and many people retiring. Severance pay was just over a $160,000, but we didn't have the ability to ask for that within our budget. So I wanted this committee to know these things about what's basically, what I'm working with within our budget. Now if there are municipal budgeting strategies that account for this, I simply don't have those answers as what those strategies might be or why this needs to happen. But at the same time, there are a number of different budgetary items here that, would not necessarily show that we're 377,000 plus over budget.

So with that, asking for an explanation or asking for some input on why this resolution shows that, that's my input.

Any other councilmember Newberry? Any other discussion? Thank you. Chief Kudran?

I have a question for director Hawkins. I'm sorry. But sure. Yeah. Director Hawkins?

I misunderstood. I thought we had everybody coming up.

You've noticed. Sorry. It's out of the norm.

Oh, is that what you want? Okay. Hi, director Hawkins. Welcome back. I have a lot of questions, but I'll try to limit it to three and then follow-up afterwards.

My question is the overruns are it's four departments. It's not just the the police department that's here. And with the overruns, I understand finance is is complicated, and sometimes numbers tell a strange story. It's difficult to understand, but I think we all admit that it doesn't look terrific. When my question is when when were the overruns first noticeable and were they flagged? I mean, did this come up after the end of the year, or did this happen did we know about this in July 2025? So I'm just trying to get my head wrapped around. And I know it's multiple departments too.

I don't know if I have a real good answer for that. I mean, majority of these overruns tend to peak their evil head around that November, December time frame. Every month when we submit those financials, we are looking at percentage of budget used. And typically, nothing's really flagged up until right around the end of the year. There tends to be a lot of additional payouts and things just through the collective bargaining that kinda creep up at the end.

So I mean, to answer your question, I mean, doesn't nothing has ever flagged me early on in the year. They usually come closer to the end of the year. Are they anticipated? A little bit, some of it, just the way budgeting and the finance goes. But overall, as you can see, I mean, as a city, I think we did really, really well.

Okay. Thank you. I and I'll I'll cut it down to two. Does the do you, as as the finance department, have the authority to, like, compel any of the department heads to to take any corrective actions or, like, report to you that some of these things might be coming early on? Or is everybody just kinda surprised like you say and just you know that there's unexpect what I heard was there's unexpected things that are gonna happen at the end of the year, the calendar year, and that's a given, but you there there's not a way to account for that.

These are tricky, very tricky questions because I'm trying not to overstep here or or speak about these departments and the operations that they need to do to conduct their jobs. You know, every every department has the ability to monitor their budgets monthly, daily, weekly, whatever it takes. Again, budgets are not finite. They certainly are fluid. There are things that come up in any given department at any time that could throw those budget numbers off.

Do we anticipate them? Maybe a little bit. But do we hope to put together the best budget we can at the beginning of the year? Absolutely. But again, they're they're they're they're not finite. They're best guess scenarios. They're they're based on past some ex experience. And and you hope at the end of the the year that that we come out positive. And again, as as I mentioned, as a city, we did very well. We had a 70, you know, $6,000,000, $74,000,000 budget, and we actually came out in the black.

So overall, that's what I look at. I'm I'm more concerned about the city as a whole, not necessarily department wise. We all kinda came together and helped helped out each other. You know, I I always feel like we collaborate at the end of it. You know, I had some leftover money. I had no problem sharing it with those that needed it to conduct their operations at the end of the year. And again, I just stress, I look at it and I say, we came out in the black at the end of at the end of this. That's a pretty good successful year.

Okay. Thank you. That's all I have. Thank you.

Councilmember Jansen? Chad, I have

a few questions for you. I'd like to go back to, some of the information we got from our police chief. I thought it was extremely helpful, and I've heard similar stories from, over the years. And I've never been real fond of this resolution that we do every year because it it leads to people interpreting things, not necessarily in a positive way when it and it shouldn't be perceived in a negative way. And I guess I think the council and the public in general, everybody needs to have a better understanding of you know, the police chief actually shared how much he saved and things that he had control over.

So why don't we actually put all the necessary money into their fund so it doesn't look like they're actually going over budget?

That one's gonna be real hard. I'm gonna try really hard. An answer that could potentially I don't know. I don't wanna incriminate anybody here within the department, within the city. I think we'd, again, do our best to anticipate expenses on a given year.

And there are certain circumstances that tend to make budgets go over and that's part of budgeting kinda like your own personal home. Right? You you kind of anticipate things going really well through the year. You you know, you got your rent and your mortgage and your everything else. But as soon as a water heater goes, it throws your entire budget off. You know, those those are just those unanticipated expenses. And we see it every year, absolutely. But we do have restraints that we're trying to also meet on a given year.

But if I'm understanding correctly, the only thing that went over on paper here is regarding staffing, and we already knew when we did this budget how much staffing money they would need. So was that all the money that was anticipated not put into their budget that it would be so far off?

I don't have all the answers to what really makes up their entire short shortage there. I was just kinda looking. I mean, there are certain things that, again, finance over the years has not budgeted for. I think the prime example for most of that is the severance pays, depending on the year. Again, those are unanticipated expenses that you just don't know.

There are some additional overtimes, but anytime there's additional overtime above and beyond that, it's not just the overtime dollars. It's also the 20% that you have to add on for Wisconsin retirement and your FICA taxes and things like that. So, you know, those those add up. You know, I was I was looking salary and wages at least for the police department was almost dead on. It was almost spot on.

I think it was maybe about a $9,000 difference. So we're trying. I mean, I've I've mentioned last couple of years in our budget meetings with the mayor and trying to trying to produce more accurate numbers for what it truly costs to operate some of our protective services. But again, every year we tend to be limited and we have restraints that we're trying to meet as well. So we're trying to present the best we can.

Council Member Sledgenickle.

Chad, a question. How real time is the finance department able to keep track of expenses? We heard from chief Kudran that in the past cost, you know, overtime costs have been definitely beyond the amount that was allotted each year. Is the finance department I know if I'm balancing or or keeping track of my financing, I'm looking at it pretty carefully, you know, almost in in real time. But here, it looks like we get to the end of a fiscal year, and then we realize that things are overruns.

I'm are things looked at monthly? How is that looked at in the finance department when salaries or costs come in and are evaluated so that there is that discussion with departments as to, you know, this is looking to be significantly more expensive. When I did the when I calculated the overruns, it came up to over $8,800,000. So how is that adjusted in the future in our operating budget? I mean, is that used as a basis in the operating budget for next year that we're anticipating that this is going to be in addition what our 2025 operating budget is.

I guess it gets concerning for me that, especially from what we're cons you know, what we're seeing with our our revenue and expenses that this could be a significant addition to an operating budget that already is something that we're challenged with trying to reduce?

They're good questions. We all know that that budgeting process is complicated. We certainly can put in larger numbers in categories in the future. But if we're again, state statute dictates that we present a balanced budget. So in order to do if we're going to increase our expenses by that much, we also have to figure out a funding source to match those.

And that certainly is possibility. Finance over the years obviously has tried to balance that the best we can with the limitations that we have with our funding sources. Again, we're in the process of trying to shore up some of these departments that typically on a yearly basis have these same issues. But it doesn't come without additional expenses and additional reductions elsewhere to make it work. And those are the hard decisions that we've been asking for for for several years.

But, you know, we we can certainly present the worst case scenario ever on this year's budget. That is certainly an option.

Council member Newberry.

Doctor Hawkins, I'm just hoping you can clarify one thing that I forgot to ask you. In the resolution itself, one of the whereases is about the library, and I'm just having trouble wrapping my head around what it means, and so I'm hoping you could simplify it for me. It says 2025 had unexpected expense funds of $275,000 and change and revenue under runs of $6,500 What is an expended expense fund and a revenue under run? I'm confused by those terms. Thank you.

Yeah, this is a much better question. I like this one. State statute does dictate that any monies that are appropriated through the common counsel are basically library board funds, whether or not they use them all up at the end of the year or not. So this is a mandatory requirement that the state statute has us due. Any of those unexpected unexpended expense funds then do get carried over to the following year per state statute and that's where that $275,000,000 So whatever the rationale or reason why they didn't spend that could have been they didn't have as much repair and maintenance.

It could be they had some vacancies. Whatever the cause might be, they came in $275,000 under budget. And again, state statute, we're required to put that in their carry then the revenue overruns or underruns mean that they anticipated X amount of dollars in revenue coming in, they didn't hit that number.

Okay. That makes sense. Thank you. That's the only question I had for you. I I was interested in finishing up on the the other department heads that are in the room, chief Schott and director Ottobar for kind of

We're going to go to Councilmember Kalos. She has questions

for Oh, yeah.

Sure. Hawkins. Thank you.

It'll be quick. So you might not know the answer to this. Things like public safety, other municipalities I have seen have done referendums to allow to exceed the levy limit for whatever, for officers. So that's something that we, as a council, as a city, could do and ask the public, correct? I mean, do you know the answer to that?

Yeah, I think, I mean, obviously, common counsel has every right to present and propose a referendum question exceeding levy limit. We've had several discussions. We had Ehlers in not too long ago that helped confirm. I don't believe we're there yet. I think we still have capacity elsewhere to balance these budgets through the use of our fund balance or our debt levy service without going to referendum at this time. I'm not gonna say that we'll never get to a referendum. I just don't believe that this is the appropriate time to be presenting a referendum to

the public. Okay. It sounds like we're not funding our police department fully, though. He said they had seven positions open, three that they agreed. So four were open, but they still somehow said with, I don't know who the numbers said they used 100%. And then also, they always exceed their overtime. So we know that they need more money. So we're going to expect this probably every year. We should maybe be looking to fund our public safety. I know that's one of the allowed reasons to go to referendum to exceed the levy limit.

So I just want to make sure that our departments are funded, because as we can see, this is difficult at the end of the year when this shows up. And I agree, we look at the city as a whole. And yes, we were in the black, but the perception is interesting. And then the second question I have about the library, they had 260 some thousand dollars, so that could have possibly been used to keep the north side library open.

Can't speak to their board in the decision that they made.

Council member Jansen.

Director Hawkins, normally, we don't the only, department that has carryover is the library, obviously, for for legal reasons. And I'm curious as to, why we have in the resolution, a request for the HR to do a carryover, would that not be more appropriate to be in its own resolution?

I mean, it could it could have been. I I think just in the past, the the resolution and with the carryover has always been done in one. We certainly could have done that. Since I've been here, we have not made recommendations for other carryovers other than that. So this is kind of the first year going back to the old way of presenting this, I guess, with this request. And, again, this is something that is written in city ordinance. As you can see there, municipal code does allow for departments to make those requests. So could it could it have been on a separate resolution like the library or the arts board made, sir? Absolutely. Absolutely.

On its own.

I'm gonna so I was doing the research on this, and I was looking out some of these paid outs that we do at the end of year. And from what I can see, we've done them for at least a decade, if not decades, for the comp day banks, the holiday banks, and the compression pay banks. Why aren't we putting that in the budget when we know we're going to have to pay them out? That puts and and, again, I don't know if this is happening in fire, but we're we're kinda concentrating on police right now. But that just puts them behind the eight ball right from the start.

I would agree. And again, I think I don't I don't know why the practice started years ago by taking them out. I'm guessing because we had budget restraints and we had councils that were asking for budget cuts. And where do you make those cuts? You make them to some of these things. Is it the correct way? Not necessarily. Was it a way to probably meet the expectations that was set by the council when you put it in there and then we're asked to make 5% reductions?

Well, this isn't this this is a this is this council. And so but we're we're not putting things in a budget that we know we're going to pay. How how are we supposed to how are we as a councilor or how's the police chief or how's any what are you supposed to answer? Why? Why do we do why are we doing that now in 2025, 2026?

Can't answer that. I don't know.

Okay.

With with the way that it was budgeted this year, we still had to make I don't I don't remember the exact amount. How many millions of dollars do we have to make reductions? And that was without including it.

So and I'm not gonna go back to the overtime. You know, when we're given the specific numbers of what overtime was for the last three years, isn't that telling us as they're increasing what we need to tell the city that we need to fund fund the police department to run a safe city? Again, you know, it it's just it's amazing to me that we're not if it was at $2.60 and we went up to $4.89 in 2023, clearly, two sixty wasn't enough. We didn't even go up to 300. We didn't even go up to three fifty.

Then we went up to five zero three, and we still stayed at two sixty. Then we went up to five twenty one, and we still stayed at two sixty. So this just doesn't make this just does not make sense to me. And then we say, well, it was maybe because of the severance. Well, no. It's here. And so I'm I'm trying to figure out and, again, I'm not an accountant. I'll be honest. But if this keeps going on, this is gonna start to unravel somewhere, and it's gonna get the city into some financial hot water. Correct?

I mean, over overall, the budget, again, came in in a black. So I again, I I can't I can't sit here and speak for the operations of of a couple of these departments. I I do know that Okay.

You appear to be alluding to certain departments are not doing their due diligence. And shouldn't you say clearly who you think that is so they can stand up here and tell us what tell us what their departments and so they can explain? Because you're you're you're telling us that some departments are not doing something, but we don't know what that is. And and so we're led to believe that it could be any department. So shouldn't we know who that is, or shouldn't they know who they are so that they can explain?

Because you made a comment about salaries, and I could see chief Kudan shaking his head. So we're gonna probably get back to that. But we're it seems like we're dealing in a lot of nontransparent manner here. And it seems like we're just there's so many questions about how we're writing a budget. And in in this really critical time, I think that it's so important that we need to be transparent.

I'm I'm trying to figure out the answers to these questions about the 432,000 in something we knew was coming and in the overtime that we knew was coming, but we're still sitting on seven vacant positions, which I think, if I'm not mistaken, are about $750,000 plus that they they did not spend. And then he, the chief also talked about a $171,615 that he controlled. So they are being fiscally responsible, but we're saying in a resolution that they're not. So how do I how do we answer that, or how do we fix it?

And, again, the the resolution is not written to oust or pinpoint any specific. It's a statutory requirement that the balance that the budget is balanced and the numbers are what they are. That's what this resolution is trying to do is just meet statutory requirements. It's not to point fingers at any one department. Again, I'll say it again. Overall, our budget for the city was great this year. We came in in the black. Some came in under budget, some came in over. But together, we came in under. That I think is a win.

Councilmember Newberry?

Thank you. I just wanted to finish up on the two remaining directors on kind of the status of their budgets. They came in over, came in under, how that happened. Thank you, Doctor. Hawkins.

Hello. I'm on the over side, so I'll, I'll entertain any questions right up front if you have them specifically for anything regarding the fire department budget.

Council member Jansen, can you

tell us if your overages are strictly related to staffing?

I would say for the most part so the number one over the line expense, so to speak, was our overtime budget with 270,000. Severance was 110,000, which we can't budget for. So that was a chunk of it. The second piece was something I think our public safety side shares. When you go over on your budget in overtime, it does not absolve you for not paying the benefits that are associated with that. So the WRS benefits and some of the other things associated with that are at a 20%. So if you go over for a half million dollars on your budget for overtime, you have to pay 20% of that in wages. That's not budgeted for. That's not something that can be foreseen. So for example, today, the six year old that we were all looking for on the South Side, we called in an additional drone operator.

That's a minimum of three hours of overtime for an emergency like that. There are things that in public safety we can't account for, so you're gonna have those overruns in overtime. We had 47 investigated fires, two of them fatal last year. They require numerous hours that are outside the eight to four of those inspectors. So public safety, I think, gets an exemption on the overtime side of it to some degree. Now there's some things I will take responsibility for that we're over, and I'll readily admit that. It was my decision to keep Station 10 open on the North Side so we could use that for storage, so we could complete our renovations at Station 3. That's an additional $5,000, in some cases, maybe even higher to keep the utilities on in that place and keep the heat on. That was my decision. I have to own that.

That's not millions. That's 5,000. But there's other things that chief Kudran and I do routinely on a day to day basis that I look at, and I'm in that budget every month at the end of the at the end of the cycle, pay cycles in particular, and looking at where we're at. So for instance, if it wasn't for we always talk about how the state should help us out. They have done that in the EMS side.

They have a emergency medical services funding assistance program that allowed us this year to take out 25 to 30,000 in our normal equipment needs that we normally would have to budget. Knowing that going into this cycle, we had a CBA agreement that was signed in December 2024 when the budget was already set for 2025. There were gonna be fiscal impacts. I knew that. We had to make some adjustments.

But overall, I think the benefits, the severance, the compression pay that was not budgeted for, and our salaries and wages, and and, again, our maintenance cost have just been skyrocketing. We didn't receive those two new engines until December 2025 that we ordered three years prior, so we're spending additional dollars on high mileage and high hour engines to keep them in service. For example, today, I learned that there is a $6,000 repair to one of our reserve quints that we need to keep in service. The good news is we have a relationship with city shops. That $6,000 repair would easily be $10,000 for all the engine work if we did it at an outside shop.

So there's always savings to be found. There's always department head responsibility. And chief Coojahn and I have no problem sharing where we're over, where we're under, and what we're doing about it, But there are certain things that we can't control. There are certain things that we can't predict. And I think that that budget is a reflection of that anytime in public safety. So that's where I'm at. I have my list in front of me of things. I have the the budget list if you have any further questions on any specifics that you might have.

Councilmember Johnson. Thank you, chief. And and I am in full support of of both you and, chief and I believe that the this discussion is very important because it's important for the public to understand that you're really not going over budget, in my opinion, and that the problem is on our end for not giving the appropriate money in your budget. And I don't at some point, that needs to be figured out. But in no way do I want you not to call in the resources that you need, and I don't want our police chief to call staff away from a call that they're on just because their shift is over. So I would just wanna make that very clear.

Appreciate that support. Thank you.

Thank you, Chief Chaudh. I think Barb Jensen just spoke for us all. Chief Kudran, could you come up one second? The budget director made comment about your salaries, and I saw you shaking your head. Do wanna clear anything up?

Well, again, as as I spoke before, and and this was an area where I we we just have not received an explanation for. So if we were fully funded for our strength and staff but yet had positions open the entire year, I'm I'm still unclear as to how we could be right at a 100% for our salaries and wages. And and I know that's what he referred to, and that's right. I simply don't have an understanding for that. So I I don't believe it's completely spot on because there in actuality, again, if we're if we're simply comparing apples to apples, there there would be a savings that should be shown.

Again, if there's an accounting practice that you know, that would explain that, I just don't know that. So that's where I I'm I'm still a little bit unclear.

Have you asked for that accounting practice?

Well, we've asked for a lot of clarification just because a lot of these numbers are unclear to us. Myself and assistant chief Dan Close, who who really does the the daily inputting and as chief Schott referred to as far as, like, looking at each month, where our percentages are at, and and where things are are are basically trending towards. I know council member Sleznikau had asked about that as far as do these things sneak up on you. There's budget numbers being ran on a regular basis through the Mina system. So we're simply trying to be we're trying to find that clarity as often as we can, but there's a a number of different areas within here that, as I mentioned before, have become unclear.

So

Any other questions for chief shot or chief Kudran? I'm sorry.

That's alright.

Seeing none, could I ask, director Franzen to step up, please? Thank you. We've been told that some of the problems are from through collective bargaining, that we can't do the budget because of collective bargaining. That doesn't sound correct to me. Is there any way you can show shed some light on that?

Sure. So with our collective bargaining, we typically or have history right now of doing three year contracts. So we should have pretty good ideas at least for two of the three years what those budget numbers should be. I can understand that initial year, depending when a contract is settled, we may already have a budget done and have not had a settled contract yet. So I can put some justification around that first year of a new contract. But years two and three, if we do three year contracts, we should have pretty good ideas of what we should be budgeting for.

K. Thank you. Any other questions or comments for Rebecca Friend then? Okay. Any other councilmember Newberry?

I didn't wanna hear from director Odegaard, but I you you can come on up. I also, while you're coming up, will telegraph what I want to do. I think that my the way I'm thinking about this right now is that I don't think this has any has any business being on a consent agenda moving forward to next week. And so I will happily vote no on this just so that everybody is aware of that for that purpose. So, doctor Odegaard, how'd your budget go?

Thank you, council member Newberry. So the parks department, Park Rec, Forestry, building and grounds, I believe we were about 98,000 to the good in expenses, and we were 62, 63,000 exceeded in our revenue budget. The the the expense our 98,000 under was largely in part to we had some specific internal staff movements where we had staff that were on paid leave, unpaid leave for some extend extended periods of time. We also had two management positions that say sat vacant for a while. And not that our overtime compares to public safety by any means, but 2025 was a very minimal year for summer storms.

We didn't we didn't reach any of those, and a lot of our budget, specifically in the forestry department, is aimed at those potential storms that can bring our our, obviously, need for contractors to come in, but then over time itself. So I will let answer any questions.

It it sounds like you just said that that you have wisely a little bit of slack built into your budget every year anticipating some unexpected storms, things like that that are likely to happen. Is that true? Is that what you said? Did I hear that right?

I mean, this year or 2025, it happened to work out pretty well. 2026 or 2024, we did exceed our expense. I think it was by $5,060,000 dollars. We had offset that in that resolution with our, us exceeding our revenue budget. We're a department that depends very highly on the revenue that we have come in, and that's something that has has blossomed, so to speak, out of the COVID pandemic is our pay to play operations for recreation has have really taken off.

But thank you. Those are the questions I have. Thank you.

Thank you, council member Newberry. Council member Jansen. Director Ottogard, could you

expand on, those revenues, the pay to play?

Could you clarify in what sense?

Is there one particular area that you saw a significant increase or regarding the revenues, or is it just spread out?

I mean, we've we saw a huge increase, in, like, the boating, the aquatic nature with our marinas, with the with the, professional fishing tournaments that come in, and then the just the the vast number of people that come and use our boat landings, which now cost money. But Forest Hills has been a a huge increase there as well. I'm convinced and speak with my staff and the park board continuously that in the recreation world, that will be our survival moving forward during as as we all experience these these budget cuts. And one of the things so our budget is about a $5,100,000 budget. However, in in reality, it's it's far greater than that.

But most a lot of those expenses, related to Forest Hills waterway accounts, so on and so forth, come out of that revenue that goes into some of those accounts. So we're able to keep it off of our operating budget. But I don't wanna give back that 100,000, but, you know, this year, like I said, it helped that we didn't have any of the of the big storms that, you know, we we have seen traditionally. And to be honest with you, we have not had the expenses that we've seen in the past specifically to some of the unsheltered issues that we've faced since that camping ban, which was a really hit our department. And and council member Newberry, I know you and I had had some back and forth in regards to the, contingency request on security.

Like, that took that those expenses out of our operating budget. Thank you.

Director Odegaard, do you all the money that you get through the Marina, the Forest Hills, do you manage all that money, or do you have to give any of that money back to or give any turn any of that money over to anybody else?

That money, I mean, it it's all housed and administratively goes through the finance department, but that those expenses are what cover the expense or that revenue is what covers the expenses associated with it. So the expenses we have on the river that were traditionally traditionally paid for through our operating budget, through the city's operating budget. At one time, way back, it was actually the planning's operating budget. Now we're paid for by that revenue.

But you

So our staff that are associated with the marinas, they're paid for out of the revenue. They're not they do they're not housed in our operating budget.

K. Thank you. I see director Gallagher is online. Do you wanna speak to your call out in this referendum or resolution?

Sure. I I certainly could. I I think what you've heard to some degree, mentioned by by fire and and police, would be what would apply to some of our overtime. Some cases where when projects are being delivered and have to be inspected in the field, that's a very difficult thing to anticipate. Twenty years of data shows that historically, overtime has been exceeded by two to even five times in a given year.

And that's a difficult thing to do to come in to request more. But, historically, requests from the previous city engineer or or from myself, you know, had have not really been met. That's one portion of it. A portion of what we saw in our department as well were unanticipated software computer expenses. Sometimes those can or can't be predicted.

Sometimes those are delivered the year after you order them. That's sort of one of those things that hits late in the year and is not easy to predict as well. We did see a shortage in some of the revenue that engineering generates. We're not a big revenue department by any means, but the permit revenue and then sometimes the snow shoveling revenue that is accounted for under our budget was something that was quite short this year, and adjustments have already been made for next year. Another one is just somewhat the cost of doing business, you know, the the cost of supplies, survey equipment.

We've taken on locating for fiber optic and electric in the engineering department for the past few years, you know, and and that's a a larger equipment cost and and field cost. You know, it's just sort of absorbing those things that you have to do in order to deliver the projects, in order to provide the service that is required for the projects and maintenance under public works. Historically, it's been, you know, a balance of typically running under and, you know, a couple years running over. But that's that's what I have available at at my fingertips now regarding, this resolution.

Any questions for director Gallagher? Dirk or councilmember Jansen?

Director Gallagher, could you, address, like, staff shortages or unfilled positions that you had this past year and how impacted your budget?

Sure. So I'd I think for for ten days early last year, we were fully staffed. Other other but we've been short the one position, one director or deputy director position most of last year and into this year. And that's one that happens to be funded entirely by the utilities. So really, it's it's not one that then would provide us a cushion, you know, being left open because it's not levy funded.

But that's currently the only open position we have. We do have an LTE or or seasonal engineer budget that that we utilize as well, and those have been fully staffed as well. Again, sometimes generating overtime just for the the requirement to to be in the field and to conduct inspections when contractors are doing work.

Thank you. That was very helpful regarding the deputy director position.

Any other questions for director Gallagher? Okay. So I guess that leaves you, mayor. You're the only other.

I could have sat down, but I decided to come up. Thank you. Appreciate that. So first off, I'll say the 2025 budget, obviously, is not my budget. I was elected in 2025. But what I've been told in terms of our overage is that our communication coordinator position and our my executive executive assistant, Both those positions were paid partially through another fund. And in 2025, they decided to move both of those salaries over to the mayor's office and not pay for it through what fund was that? The health insurance. No, not health insurance. Was it health insurance?

Health insurance. Yeah. There you go. So that explains my 1,500.

And I appreciate that. Thank you. Yep. Any other discussion or questions? Seeing none, we'll move forward with the vote.

And that agenda item passes three to two. With no other agenda items, I'll be calling this meeting adjourned. Thank you for coming, and I really appreciate everybody coming in and answering all the questions. It wasn't easy. So appreciate you guys.