on the lake. Okay. All right. It's Tuesday, September 2nd at 700 p.m. This is the city of Brandon Personnel and Finance Committee meeting. Let's start with introductions. All around Large Kevin Studik. Chris Schubert, HR director. Connie Hillman, city finance director.
Nick Broy, city administrator. Kelly Bavin, city council, ward 2. Theresa Burke, Brainer, dispatch. Mike Duval, resident in Ty Hills. Dolly Matt and BPU,
Eric Sharpier, executive director of the Briner H. Danny Lock, finance manager, Mike Gman, BP Commissioner, and Gabe Johnson, chair of the committee. We have six items in front of us tonight. The first of which is 2026 long-term disability and ancillary
benefits proposals. Chris, so we are required by law to solicit proposals every 5 years for insurance plans when the employer pays for a portion of the premium. Earlier this year, the council authorized staff and Integrity Benefits to conduct an RFP for our long-term disability insurance to
meet that requirement. Three proposals were received and Integrity Benefits has provided an analysis for those for that um for those proposals that's in the packet. Madison National is our current carrier and they are proposing a 10% decrease to the premium rate with a
three-year rate guarantee if the city keeps our current plan design with 180day elimination period. Uh integrity benefits by the way mentioned this is the lowest rate of any of the clients that they represent. So it's a very good rate. We also requested an option for a
90-day elimination period that would match the Minnesota paid family medical leave that we benefit. Um that rate for that option would be an actual 17% increase from where we are right now. based on the increase and we would also need to negotiate any change with the
unions. Staff is recommending to accept a proposal from Madison National for our LTD insurance policy effective 1126 with our current elimination 180day elimination period. In addition, our insurance committee met on August 25th
and discussed this LTD renewal as well as our ancillary benefits. Um attached in your packet is the presentation for that meeting. The committee recommends that we switch to Metife for our dental, asthma, critical illness, and hospital plans for 2026 as the plans and rates
are very competitive to our existing plans. Also, by doing so, this needs met life's coverage requirement to receive their their 2-year rate guarantee to administer our paid family medical leave private plan. Um, please note that the premiums for all of those plans are paid
fully by the employee. So the recommended motions are to accept the long-term disability insurance proposal from Madison National effective 126 and also to accept Metife's dental accident crit critical illness and hospital plan
proposals effective 126. I move second. Any questions? We need two motions or one. You're moving both of them, right? We only need the one. All those in favor say I. I same sign. That motion carries. Next
up is a change order for the LI library project HVAC. Nick, yeah, I got asked to brief this a little bit ago. Mike's upstairs briefing, so I'm going to try to do this justice. I think that he did talk to Councilman Bevans a little bit as a library liaison. So, at the April 21st council
meeting, city council has already approved. We went through Gordian. Gordian's the source. Well, you know, they had the cooperative purchasing thing. um this Gordian thing and I know Kevin Jagger asked a lot of questions about it a few months back is kind of a cooperative hidden type um service that they
provide. So we went through Gordian we've got this approved through council to balance the HVAC system for the library. The total was 6735. So since that time Gordian has they've chosen Hi-Tech has to do this work for them. Hi-Tech is recommending
um as is what's already been approved $6,735. We'll have two air conditioners that work as advertised and will take care of the humidity problem in the library. Eight. Uh, Hi-Tech is recommending that uh we go from a single stage to a
two-stage system, which will allow the two units to work together as one, which will presumably make them a little bit more efficient and presumably extend their life span a little bit. Proposal for this is $8,385.50.
So, the delta is $1,650.50. Again, this is just to go from a single stage to or excuse me, a single stage to a two- stage to have the units work together essentially as one unit. Staff would recommend the $1650 delta, but I
just want to make it clear that as is, they will function fine as two separate air conditioners. Move to approve. Second. Well, I can explain it a little bit. Maybe not better, but in detail. So, we
have one that's a year old or two years old that does the main part of the library. This is one that we just installed. HVAC unit sits above the main conference room. They the humidity problem was determined and
and I certainly cannot speak to this to be a balance issue between the old unit and the new unit. Didn't work together well. Well, they both work now, but they're very independent of each other. This $1650.50
makes it work much more efficiently. So, well, they'll talk to each other and one will kick the other one on, etc., etc. So, they it it makes sense since we're trying to get rid of a humidity problem for $1,650
to make it actually work. And that money will come out of where? capital fund. Okay. All those in favor say I. I. That motion carries. Next up, I'll close some bond funds. Connie.
Yes. So, the city paid off the general obligation improvement bond series 2013a, which was accounted for in fund 317 in February of 2024. And it paid off the go improvement bond series 2015a, which was accounted for in fund 315 in
February 2025. Fund 315 has a negative cash balance of around $1,900 and fund 317 has a positive cash balance of about $12,900. The attached resolution transfers funds from 400 to fund 315 to 0315 and from
fund 317 to fund 400 to zero fund 317 or 317. The resolution also states that there's any delinquent taxes or special assessment payments received in the future, the funds will also go to fund 400 as well. So staff recommend a motion is to adopt the attached resolution
um relating to finance transferring certain funds to and from bond funds. I second one question we have like fund 400 is like a million in the positive and our fund balance policy in the general fund isn't near where we want it to be. Why
are we transferring this $10,000 to an overly healthy fund instead of one that's under where we want it to be? We could change where you wanted to. I just thought it was $10,000. It wasn't that much of a difference. Um, combined the nickels and the dollars take care of themselves. There you go. You're right. So, I mean,
we could do that and then just any delinquent taxes go to fund 400. Is that what you're saying? We could just change it to be transferred from to from general fund as well. It would just be nice if the later collections all went to fund 400 because Yeah, that makes perfect sense. We don't know what we're going to get.
Yep. Yeah. So, that's totally up to council. mean that we did that one year for a different bond issue when it was about 80,000. I just thought it was a smaller amount and since the one was negative, I think what Gabe saying is would make sense, but we can still in that act of
this motion and then we can we could conceivably transfer that much or more or less out of 400 from 400. Yeah. From 400 as a se as a separate motion once we can see all the funds that are in the rears.
All funds that are in a rears, any funds, any or all that Gabe mentioned as being in a rears or in the negative for not doing so well put up for adoption. Okay, that uh I'll support it. That's
fine. All in favor say I. I. That motion carries. Next up is the H levy request. Eric. Yes. Thank you, Mr. Chair. Uh in front of you is our levy request for 2026.
Uh as you can see on the agenda request, every year we need to bring this levy request to the city council. Uh you are the ones that do set our levy year to year. uh in some kind of historical information
there for you guys from going back from 2020 to 2025 on where maximum amount of our levy was versus the amount levied um to the city. uh by state statute we can levy up to 0185%
of the previous year's EMV estimated market value and for 2026 that amount that max amount is 227,866 uh the request from the H is to fund 100% of that levy
and in the subsequent documentation that you'll see kind of the letter that outlines the the high level initiatives that we've been continuing to work on for the city. Uh our levy dollars go into our general fund and with that we can then administer programs that
benefit city of residents. Uh currently working on getting another 18 units onto outlot E and outlaw F. Those are two outlots that we own on the east side of Brainard in the the Brainard Oaks area. U we do have
a developer that is willing to go on that is the same developer that's built out that the rest of that residential area looking at some duplexes uh but to get them to the starting line uh did entailed both the Crowing County HR and the Briner H putting in some money to
help with infrastructure uh you guys are also hopefully aware that we on behalf of the city uh helped put together a request for funding for additional infrastructure dollars. So, we're hoping and excited about that uh that project and we'll hopefully hear back from Minnesota housing within the next month
on if we are successful in in garnering some money for infrastructure. But, uh the project doesn't go without those funds that we've got. Uh we continue to work on rehab programs. Uh you are hopefully aware of small cities development program. We've got one going
in Southeast Briner right now. Uh that's moving along. We're in year one of a two-year project there. Uh we've got six out of eight owner occupied rehabs that have been awarded and completed and four out of the 12 for our rental occupied
units. So we're trucking along with that. On top of that, we've done a couple Minnesota housing finance rehab loans with three other three additional loans that are in process throughout the rest of this year and hopefully we'll pick up another one
or two. Uh obviously all those loans are aimed at at trying to rehab those units within the city of Brainard and we enjoy working on those. And then lastly through deed we did request a $600,000 grant uh for to coincide with Washington
state reconstruction. Um again hoping to hear about that uh in in September hopefully uh and that would go for streetscape and offsetting the funds for the city of Brainard. We are trying to work to get some grant money from outside of the city to uh be put into
projects around here. Um state housing vouchers, those are going to be coming online at the beginning of next year. Uh we're going to add another 34 to 40 vouchers on top of our 325 federal vouchers state program. So we're excited for that to come online. Uh those will
be distributed out throughout the the county just like we do with our federal vouchers, but those will impact, you know, certainly some Brainer households and excited about those projects. Um still continuing on with our federal funds through public housing and and our
section 8 program. Um 203 units of public housing, uh 325 vouchers. Uh those are the public housing is all within the city of Briner. U we've got costs to run that keep that up. We do get defrayed, you know, do get funding from the federal government for that. Uh
we are just like I'm sure a lot of agencies had some question marks about what our federal funding is going to look like in 2026. Um some of the rhetoric out there is is cutting public housing and vouchers by about 40%. We don't know that for sure. Uh and I'm not going to be alarmist about that, but
those are are numbers that we've heard floating around. So we, you know, just like every there are you are you asking the city of Brainer to fill the gap of any federal funding you don't receive. That's just not even remotely feasible. Correct. And we bring that up just to to
highlight and illustrate that, you know, we understand that every tax dollar is important. Uh and we've got funding questions outside of of what this stuff is. So, we do want to just highlight that that is certainly an ongoing issue
for us. Uh, if we go down to our kind of that budget, line item budget and and hopefully you guys got the the more inclusive line by item budget that I sent out today as well at the request of Councilman Chzach. You'll see where our
our tax levy request is from 25 to 26. Uh, you know, I'll be happy to to answer questions on that presented budget. It is a, you know, projected balanced budget on the general fund side of things knowing that we've got a lot of question marks
with the additional budgets that we've got that we're not sure where where that funding is going to come in at, but we're happy that we could present a balanced budget here. There are some dollars in there reserved for our board to to do projects. Um, you know, we're
currently working with developers to try to get some housing uh interest in some of the the city- owned properties that are available through the EDA. And so we are working diligently to try to get some of that rolling. And that is really where those those funds would likely be
utilized as well as through our standard site replacement program uh and any other projected projects that our board would would like us to work on. uh would open that up to questions for for the committee on what you're looking to do and happy to answer that.
Any questions? I I have one, Mr. Chair. I I don't know who the leazison is and I would certainly and I still want to support the H. I think they do a lot of good things. In the past, as you look
at the amount levied versus the maximum amount, the reason there's a disparity there, if I recall, is because the leaison determined and obviously convinced four votes of the council that that the additional funding to maximum wasn't
necessary. And part of it was it wasn't being utilized. And there was a balance sheet which we haven't seen that included some cash that wasn't being used. And I I mean I have no idea I 100% want to support the H but I have
no idea what what the answer to those two questions are. And I I agree with you Kelly. One of the main reasons I was a proponent of holding the HR increase back from the maximum possible levy the last couple years is because
the Brainer H staff is also the staff for the county H and the Crosby H and I think the Crosby H is a good deal. The contract we have with the county has been a considerable amount of work taking up over half of
our senior level staff's time. So I and they track every hour they spend on county work. The city of Brainard money is just treated as what's left over. We'll just spend that on ourselves. And what do they have here? Another 13% raising personnel cost this week. So, I
just we're continue to pay more and more for county programming through the city of Brainer's levy, but I would like to talk to Eric about it or not Eric, I'd like to talk to Eric about I'd like to see what Kevin thinks, too, because I have been the lay on there this year. So, I I would really like to hear his
I would too. I mean, does that make sense? Yeah. To the county point, I don't know if you guys read the brainer dispatch, but we are looking at considerable funding decreases uh at the county h level, our housing trust fund to to zero dollars.
Sorry, I unsubscribed this spring and and that's okay. Uh just something that that commission is is looking to do. So I would say, you know, that offers more opportunity for us to work on issues as well. A operating
cut or the housing trust fun housing trust fun. housing interest. Yes, that is what has been reported. So, I think we should bring this upstairs and let Kevin make the motion. I have absolutely no problem with that. That makes perfect sense. I like trusting our leazison. They put
in the work. Until we get to the next item, then I'm going to disagree with the appreciate it. Thanks, Eric. Yeah. So, next up is library. Connie Kelly, you want to just start pitching me now or what?
So, attached to the packet was a letter from the library board president requesting the 2026 levy be at $155,840, which is a 2% increase from 2025. Also included in the packet was a history of the library levy
um since 2000. Um and also including there was the minimum level of support that is required for the li library for 2026 and about 116,000 some $900. Um the current budget and levy as of
August 25th has a library levy of $152,784 which is the same as 2025. If the total requested is approved the impact on the preliminary levy would be an increase of approximately 04%. So the recommended action is a motion
setting the preliminary 2026 library levy. I move it didn't tell us what amount. You got two choices. Or you got a range. You can do the same. We could go from 116,790 to any number we want above. You could. Yes. Yes.
What number did you want? The board president requests 15584. Yes. It's very specific. It's a 2% increase. If you
don't know, all expenses are out, including the Kagami. I would keep my motion out with the 155. Yeah, I will second that. 155840. We did I don't know if you guys were awake five minutes ago, we did just give them $1,700.
Well, that but that and if you see if you look at 2025 here, Kelly, at the bottom of that chart, you see on the right side, it said it was a 2% increase. But during the holiday season, as we were driving around celebrating Christmas and going to visit with friends and family, my kids kept
hearing these advertisements on the radio. Oh, I don't say they have never increased our fun. We've never received a funding increase. Well, by golly, my kids were like, "Dad, why won't you give the library money?" the guy who gave him the 2% but no not the the radio ads won't say it. The
friends of the library aren't very friendly to the city of frame say that. So I'm going to not support it but we'll take that motion upstairs. Excellent. All in favor say I. I oppose I. Okay. Direction on the pilot. Nick.
All right. I'll try to keep this brief. I really want to hear your guys' conversation. This is a significant item. Pilot it. We're going to talk about payment in l of taxes from the public utility department to the city. Um we have the history there. So typically last few years we've been hovering in the high 700s for pilot
payments every year. Um council asked staff last um council meeting to kind of beat the bushes a little bit and see what other communities are doing. I have a platform where I can send an email out to all other city administrators that belong to the League of Minnesota cities. We got about a dozen responses. Um there's a couple just numbers here
and you know Danny can certainly vouch for these. Um current budget right now for 2026 is $780,000 per their 24 audit. The electrical revenue was 26.7 million. That that is real numbers. That's that's past tense
project. That's what they did in 2024. Project projected revenues for 2025 are 30.4 million. Um on the next chart, this is if you want to think of what percentage of gross receipts, if that's the way that you guys choose to go, that
would be the numbers that we would have received in 2024 and that we would potentially receive in 2025. So just to give you some context, if we're hovering in the high 700s, we're in the high 2% if you just go by grosser receipts. But ours is based on I've also put the
policy in here. So ours is based on it's a function of kilowatt hours u for retail electric customers. So that's the way that we're set up. So just as a quick synopsis and then I just want to just open up for conversation and get direction from you guys. I sent this out. I'll just give you some very um
I'll give you kind of a broad brush. Princeton says utilities are technically their own corporation. They should set their own pilot amount. That's what Princeton says. Um this is uh Wadina. They do 4.4 mills per
kilowatt hour with a minimum of $325,000 a year. Um, Marshall does 5% of electric gross receipts. Elk River does 4% of electric gross receipts. New does 5% of electric gross receipts.
Breenidge does $250,000 a year. So, they just set a number and they and this can be done via resolution. It could be done through the budgeting process, however you guys want to do it. Um, this is Grand Marray. They do $40,000. They have a franchise fee, so which is
$40,000 year franchise plus 1% of gross fees for electric services. You know, this is this is another Jainsville does 5% of electric gross revenues. So, it's kind of across the board. You know, every that responded to me that I'm seeing a lot of around four
or 5% of gross receipts. Uh my recommendation to city council would be to set the pilot where the pilot should be independent of anything else and try to find operational efficiencies
elsewhere. That would be my recommendation. Set the pilot where it should be and then we make we create operational efficiencies elsewhere. What do you mean where it should be? Whatever you guys determine should be. It can stay the same. We could say use the same formula we have. But if you want it to be 1%, 3%, 5%. Whatever you
guys want it to be. And then I I'm supportive of changing from the mill rate to a percentage of gross electrical revenue because as the world becomes more energy efficient, the revenue goes up, but the usage of electricity goes down and that is just
lowering the amount of the pilot program coming. I did some research on the American Public Power Association website and they have a public power gives back annual report that they publish and in the most recent one the national average was 5.1%
the central region which where Minnesota is located is 5%. So I really do think we should be at 5%. I did hear from Hutchinson to your point Hutchinson I don't ask me for specifics but the city administrator Hutchinson did say that he says we're going to revisit this because
last year the utilities revenues increased but our pilot payment decreased and yeah we've seen that a couple years with us. So I I think it should be at 5%. That's a huge jump. Yeah, that's $700,000. I don't think we need to turn it to 5%
tonight. I'd like to get a projection from Danny from the public utilities commission on what they have going on for the next two three years of of rate increases, what their projected revenue and expenses look like, what kind of capital projects they're doing, and find
a way that we can fit in an ability to scale up maybe 1% a year for the next couple years or something like that. But I while we probably could just say 5% starting right now, that next second of his electricity is ours, I I think we
should try and scale it up and make sure we're working within the the finances that the utility has. And Danny did send out email Friday and that was sent out to the entire today. So you maybe haven't seen it yet. That was sent out to the entire today. So he had some data and he provided a
recommendation. I agree. It should be a it should be a percentage of revenues. How much that should be just looking at this and looking at our financial situation and looking at the in the
the budgeted revenue increase for 2020. It doesn't say 25 30 million. It appears that some like a like going at 3% for 2026 would be more than reasonable, but I'd like to hear from Danny as well
because I'm sure there's more based on your email. There's more to the story. Do you want to address it right now, Danny? We've got or three minutes. Do you want to give us some information? But I agree. I think it should be a percentage. So what I will say is when
we look at our infrastructure projects, we were talking last year when we did the budget presentation across all divisions, it was a 5 to 18% increase in rates across the board to cover our infrastructure and capital projects that we had. I don't have numbers off the top
of my head if we said that 3% what that would do to rates. We did just increase rates June 1st and they're scheduled to increase again at the end of the year January 1st. So, um, I guess I'd have to take some time to go look at it and present it, but I can put that as part
of the budget presentation. I would look at any adjustment to the pilot. I would be looking at wanting to do a study and project that out and have that come further. We have to set a preliminary levy by the
end of this current month. Okay. that I mean that puts somewhat of a which means we need at least a number to put into that that line and granted it can be high it can be lowered
but we have to set it by the end of this month we've already scheduled that meeting correct no we haven't I thought we did we could do it at the next council meeting but we talked about having a special meeting because we wouldn't have our health insurance renew Yep that's what I thought I thought it
going to be a week after that, but we didn't we didn't schedule this for sure. Okay. I mean, can you get us something within two weeks? Two to three weeks. Yeah. Trying see if you can get in at three three or 4% for 25 and maybe up to
five and 27 or something like that. Like 26 27. I have no motion. Well, yeah. Well, I'll update the council and we'll say we're waiting on the oppos.