CC MIN 06212022 - Laserfiche WebLink

Councilmember Testa advised she also intended to ask for more information about possible one-time expenses the Reserve Funds can cover. She expressed support for the resolution. Councilmember Arkin expressed support for the rate increase. She stated rate smoothing seems like a logical way to return the Reserve Fund's balance to ratepayers but expressed an understanding of the potentially large costs of SB 1383 implementation. She echoed Councilmember Narum's request for a list of potential uses of the $3 million in the Reserve Fund. MOTION: It was m/s by Balch/Brown to approve the rates for solid waste, recyclable materials, and organic materials collection for Fiscal Year 2022/2023 as recommended and as noted. Motion passed by the following vote: Ayes: Councilmembers Arkin, Balch, Narum, Testa, Mayor Brown Noes: None Absent: None 29. Adopt Resolution No. 22-1318 accepting the Fiscal Year 2022/23 Mid-Term Operating Budget and Capital Improvement Program Interim Director of Finance Mahin Shah reported the Council held a Budget Workshop on May 31 and this update will focus on changes from that meeting. She reported an Operational Budget change was using $2 million from Rainy Day Fund reserves for the Century House Facility Repair Project, and two Capital Improvement Program (CIP) changes were increasing the Century House project to $4.6 million and reducing the skatepark project to $2 million. She reported the CIP changes were made. She advised the Library Roof Replacement Project bids were significantly lower than expected so the $2 million from the Rainy Day Fund for the Century House will instead come out of the library project's budget. Interim Director of Finance Shah requested the City Council approve both the Operating Budget and CIP. She presented a list of line item changes to the CIP from the May 31 workshop. Interim Director of Finance Shah reported the current proposed budget has General Fund reserves of $41.0 million, equating to 30.7% of the operating budget. She advised the goal is to have this sum maximized at 30% ($40 million for FY 22/23) with a target of 25% ($33.4 million for FY 22/23). Staff recommends putting at least the $1 million excess into either a specific project or the CIP reserves for emerging or unforeseen needs during the year. In response to Councilmember Narum, Interim Director of Finance Shah clarified staff does not recommend taking money from the Rainy Day Fund but there are a few alternatives if the Council wishes to go in a different direction. She clarified if you calculate the reserve based on the proposed budget the reserve will be 29.8%. In response to Councilmember Balch, Interim Director of Finance Shah clarified the bids for the library's roof came in the day after the Workshop. Director of Engineering Kirkpatrick clarified the bid was similar to the City's estimate. He advised the estimate from the consultant seemed extremely high to him but was validated by a second consultant. He reported the bids came in on June 1 and aligned with the City's lower estimate. In response to Mayor Brown, Director of Engineering Kirkpatrick clarified the job scope grew over time and advised it is good news the project will cost $2 million less than expected by two consultants. In response to Councilmember Balch, Interim Director of Finance Shah stated the City's operational reserve policy is for a range from 20-30% with a goal of 25%. She confirmed the lower end of such a scale is typically set around an estimate of three months' worth of operating costs. City Council Minutes Page 8 of 18 June 21,2022