All right, at 6:30 we'll call the Monday, July 14th, 2025 meeting to order. And we'll start with the pledge of allegiance. I aliance to the flag of the United States of America and to the republic for which it stands, one nation under
God, indivisible, with liberty and justice for all. All right, I'll look for a motion to approve the agenda. Motion. Second. Motion's been made and second. All in
favor say I. I. Motion carries. Uh that'll open us up for public comment. If anybody has something to say, step up to the podium. Hearing none, we'll close public comment and we'll move to the consent agenda.
Does anything have to be pulled for further considerations? Hearing none, look for a motion to approve the consent agenda. Motion. Second. All those in favor? I.
Motion carries. On to business items. Item number eight, consider adoption of resolution approving a variance to exceed the maximum height requirement of 17 feet for a detach accessory structure by 3 feet and 5 in for a total height of 25
feet and 5 in. Thank you, acting mayor. Uh tonight we have before us a recommendation for a variance request uh coming up from the planning commission. They met at their last meeting uh to take a look at this. Uh Mr. M Miller uh who is here on behalf
of the petitioners of the varants request. Get down there a little bit here. They're the ones of this property off of Ridgeway Road. Uh back down in this area. They have the house down here and they're proposing to
put the garage here. Uh the zoning code calls for a maximum height of a detached truck should be 17 ft. They're requesting a variance because they'd like to put in a taller door so they can fit their camper in there. So that was the nature of the request. As mentioned, the planning commission took a look at
this and uh their unanimous approval uh for recommendation was to allow the variance. Taking a look, they are proposing well in in the packet they had originally pro proposed a pole shed
structure but at the planning commission meeting uh comment was made that pole sheds are not allowed in town and we uh didn't quite catch that on the bottom end here. So, um, Matt will be updating that to make sure it's according to code, stick built or something of that
nature along with horizontal vinyl siding to match the primary structure in that regard. Um, so we're uh forth uh waiting for those as Matt uh will come along with this after uh he may receive approval on
the variance on that. Uh with that, any other questions I can answer on the variance request? So, we're just approving the height. Yes. So, it's not approved until he comes back with the right structure. Correct. And that's part of the
conditions of the uh the resolution. Get to it here. The conditions on that uh the resolution are one variance expiration. The variant shall become void one year after the approval date if the applicant has not
commenced construction on the improvement unless city council grants an an extension. Two, an engineering review. Any comments from the city engineer shall be satisfied by the applicant. Number three, building permit. The appropriate building permit shall be approved and issued by the city
prior to any work commencing. And that's where uh the building permit catches part of that conversion of the pole shed. Number four, building materials. This is where the rest of it gets caught. The detach accessory building is to be constructed of material similar to
the principal structure and in character with the surrounding built environment. And then five, um, existing detached accessory structure building removal. Per code, you can only have one detached accessory structure on a residential lot. Uh, so this one, as part of this
request, the applicant or owner shall remove the two small detached accessory buildings that exist on the property currently. So those are the conditions that go along with the adoption of the resolution. Any further questions or discussions? Then I'll look for a motion to approve
resolution 2025-14. Motion. Second. All those in favor? I opposed. Motion carries. 4. Two questions on this. Sure. Um,
at the last meeting, I didn't write it down. It's got to have the the um does it have to have footings? That'll be determined through the building permit. Okay. Process. So, we you'll work with a building inspector on that part. And um,
yeah, I think that was the only one. But your height is good. Yes, your height's good. Okay. So then I'll get the plans for the other and get them to us. Do I got to come back to a Nope. As uh from here on out, you'll be dealing with city staff on it. The only
requirement uh for approvals from city council was for the variance. Okay. Thank you. Thank you. On to business. Item nine, consider approval of quote for storm pond sonar work.
Thank you, acting mayor. Oh, get down to it. So, the city of mayor has a storm water management plan in place which dictates uh when we go about doing maintenance work, what we're looking for. And um one
of those factors in there is that states that when one of our storm ponds, one of the 45 we have uh reaches 50% capacity or less, meaning sediment overtime has filtered into the storm pond and filled it up so that approximately half of it
is full of that sediment material, then we should be looking at dredging that out to restore capacity down to original constructed depth. The falter in this whole matter is we do not have anything in place for us to go ahead and figure out how much sediment
is actually in our ponds. Back in 2023, we had some complaints uh around storm pond 23 and 24, which would be down in this area. There are some questions about some of the plant life that were in there and if sediment had caused that
to bloom far more than it should have. So, we had a company come in called Team Lab, and they went out in a boat and they sonared the pond. And what it does is brings back data that tells you exactly the depths of uh things. I can get over to that real
quick to show what that looks like. So when we look at the report from that uh we get a 3D modeling of that along with depths and then a side profile on that to tell you from bottom of pond to
top of pond the original constructed depth how much water and then average sludge depth in there. And these are great documents to have when we go out for getting quotes to go ahead and get that dredge. this is what the companies are looking for. They're where how much
that get will allow them to get a a very accurate quote in for getting this taken care of. So we're proposing they do so they did that work on 23 and 24. We're proposing that we have them do it for all of the storm ponds currently and
as an ongoing measure. Uh so for storm ponds they typically take about 20 to 25 years to fill up to the point where you need to dredge them out. And then what happens is you would have a company come in excavation equipment. You would drain down the pond which means you would
block you would open up the outlet as much as possible and block the inlet so you can't have water coming in. Allow that to drain down as much as possible and then the excavators go in and car scoop out all the muck back down to constructed depth, load it in trucks and
haul it away. Um so need to figure out cost for all of that. And when we get the sonar results, that'll tell us where the ponds are sitting at currently. Um, because it takes 10 or 20 to 25 years for ponds to
fill up. I would say we would look at doing this work at at around every five years to get an update to see what's happening over time. With that, some may be filling up faster than others. And that five-year range will give us a good
bead on when we need to be doing that. This is very helpful information because then we can build our storm water capital improvement program to have an idea when ponds need to be dredged and a cost associated with that. Similar to like we do with fire equipment or
streets or everything like that. We can build that out and that'll tell us if our storm water rates are where they need to be to facilitate those projects. Um I don't remember who and I don't think it was you. We did
a ranking of all the ponds with I think Bolton and Mink. Do you have you seen that? This was a couple years ago. Uh yes. So that So we like we like ranked them. Yes. You know, but you do you know what I'm talking about?
I believe you're referring to this cuz we ranked them with like cuz they looked at the inlets and outlets. I think we cleared some inlets and outlets. We talked about people having excess yes
accessory structures on the ponds. Um I don't know what ever happened with this document. So this is this is part of the storm water management plan. This is should be what you're referring to. They went out they looked at all the ponds were priority. Which ones need to have what
done to them. that was generally regulated the inlets and outlets and not necessarily the depth because we had no idea what the depth. But we're going to take this assessment that was already done that we paid for and the sonar one and try to make a
priority list of right. So the public works has been working on this end of things over the years since it was implemented. They'll go in they'll pull out vegetation they will clear stuff out. Uh so in this report if it says trying to
we have vegetation here on the outfall to the pond if this is clogged up public works will go out and they will clear that out. Okay. Rip it out, get it nice and clean. And public works does go out and they check the inlets and outlets, the storm plots on an annual basis to make sure they're
keeping. But there was a ranking somewhere, so I don't know if that will tie with some of the sonar stuff we're going to do on which ones that were like really problems. This generally deals with the inlets and outlets and the and the and the outside
and the sonar work will deal with the depth of the pond itself. Okay. This is more stuff that public works can deal with when it arises and they notice there are issues. Whereas the dredging portion that has to be an outside company. Okay. So for dredging
now when we get to that point I know like do we find is there like one accessible point or is there some that may vary because of you know what if somebody has a fence? Yes. And that's going to become very
interesting, okay? Because you look at areas like here for example, and this is just this is just the progression of how storm ponds came into existence in Mayor over time. And this is not an unfamiliar picture for other
cities in Minnesota because as they went along, you learned more about how that those were completed. So you can see right here, there is no point along here that there is a nice strip of land that you can just drive equipment through to take care of it. So
what'll have to happen is when we want to dredge this pond, we're going to have to go out, take a look at all the property surrounding it, and find the most suitable spot to get in there. And then we're responsible for putting it back to the way it was prior to
right. We have the same issue when we do the sonar work. We still have to get a boat back there. They'll pull it on a side by side, get it back in there, but I I'm going to have to go out to find the proper access point to get in there. We do have drainage and utility easements between the properties, but
that's a 10-ft wide strip. good enough to get sonar equipment in, but if you're talking an excavator, we're going to need to go to properties to figure out who's going to let us go onto their property and chew up their entire sideyard. Well, yeah, it's kind of like a road
assessment when we're redoing and then you have to you also pay for that reconstruction of the the part that you have. Yes, absolutely. So when the dredging occurs, let's say it's between these two properties here, once they're all done,
when we've created a real big mess in their yard, go in, have a company go in and restore the turf. Now, that could mean it would obviously be leveling it back to making sure the black dirt is proper, all of that. Then it maybe it's a soding or hydro seating of that area
to reestablish. I think you would defer to the property owner's preference on that one. Okay. So, a homeowner has to approve it. What if no homeowners approve? I'm just I'm just I'm just curious like I know this is going farther down, but I'm just curious the process so that we can kind
of I'm just curious like how I mean you ever done this, but like I know this is somewhat new. I know a lot of cities are dealing with this. I've dredged ponds before, but there's always been access. Okay. So, if we run into a situation where nobody allows access, um
helicopter Well, that's why there's an easement, right? You of 10 feet total. Oh, except for the excavator. I got it. Yeah. There's I don't know the answer. I assume there's some sort of legal recourse to get back there because the
whole idea of a storm pond, if that thing fills up, then backyards are flooding and there's water in basement and Yeah. So, we have it's not a good thing. So you would hopefully find the one neighbor that's willing to cave because if we don't do this then your property is going to go
underwater and nobody wants that. So you hope that would be in the community spirit. But barring that I would then you would say we the city would have to find some sort of legal recourse to get back there. Does the sludge affect like the
flora like the algae and junk in there or not really? Because I know there's been some complaints about that a little bit. Um if it r if you get sludge in the bottom it rises the base up so it'll make it easier for plant life to come to the surface.
But if you're greater than 50% that's not a ton. We get duckweed in a lot of ponds and we get some complaints about that. But duckweed's naturally occurring. It's going to happen on any body of water. The other thing that we talked about when this originally kind of came because residents were complaining is
also if you use fertilizer on your properties that just actually feed and it runs off into the pond. It actually feeds that that growth. So, um there's I think we've posted a lot of educational things of like what you can
do, but that means every homeowner that surrounds a pond would have to understand that this is a storm water collection system, not necessarily a pond and that there's things that you need to do as a homeowner. Just like you don't put your grass clippings in the
street because that feeds into the river system, right? pick up your dog poop because that feeds into the river system. So, it's like all those things that it's more of an educational thing, but I'm just curious if
then we would work with the DNR to eradicate it. Okay. So, what's this going to cost? So, back to have all the ponds. So, the ponds we're looking at, uh, go back to
this, not to that. We're excluding 23 and 24 because we have those. Those are recent ones. We aren't going to do 41, 42, and uh, 43 up in the Fieldstone area because that just hasn't been developed yet.
There's no point sonaring it because if when that is developed, that'll all be redone anyway. So, the quote is for the remainder of those and team lab uh the p uh public works committee met talked about this and um we got a quote back from team lab in the amount of $12,000
to do all of the work. Bolan Mink took a look at that and said we can't do it for cheaper. So, I said that was a pretty good cost. It's actually lower than I would have anticipated, but I don't really know. Me too, actually.
Well, I suppose the more expensive is actually then I was thinking it was going to be in that 20-ish range. Any further discussion? And I'll look for a motion to approve the quote for storm pond sonar work in
the amount of $12,000 to Team Lab. Motion. Second. All those in favor? I I opposed. Motion carries 40. And does this come out of the storm
water uh fund? Yep. Okay. All right. Business item number 10. Consider approval to host an open house and allow for a tournament at the disc golf course.
So the park board at their last meeting we were joined by Andy Bu who was one of the uh working uh was part of the working group for the disc golf course for the design work and uh him and Jason and Joy did quite a lot of work on that and uh they would like to organize a
tournament at the disc golf course. They would like to slate that for September 6th this year. And the idea being uh we would like to have an open house encompassing and browing the whole event. So I'm going to pick arbitrary times here if we went from 10:00 a.m. to
2:00 p.m. We would have the open house occur throughout that entire time, but the tournament would occur on the back part of that. So the public would be invited out, tour the course, play it a bit, and then the tournament would happen. Public could still attend. Uh
but uh the tournament players would then take over the course and the public could watch a tournament take place on that. Uh as part of that um the mayor baseball club has offered to generous generously donate funds towards the
purchase of commemorative discs that would be given out to all attendees who come to the open house to the tune of approximately $2,000. Um the park board was really on board with it on board with it. They really like the idea and then they even talked
about next year wrapping it in wrapping a tournament in with the Mayor Rising Community Festival and having that be a part of that each year moving forward. So with that looking for and also advertising the tournament to
the general public to be aware of who would organize that for people to sign up is that so the tournament is privately organized. Andy would be handling all of that work. Mhm. The open house on the other hand we will be participating with. How many discs are you anticipating
making? About 180. Any further questions or discussion? No. Look for a motion to approve. Uh Andy,
how do you say his last name? Andy Bu to organize a disc golf tournament and the city and park board to work on an open house. Motion. Second.
All those in favor? I I opposed. Motion carries 40. I would think moving forward in the future if it doesn't fall on the community festival date for whatever reason, one of those things where we approve it this year, but in future years we would just have
it again and wouldn't need to come back to council for approval. Right on to council reports. Sam, I've got nothing. Nikki? Nope. Emily, you just heard about the fiscal and I and I have nothing. So, I'll look
for a motion to adjourn. Can I just ask how can I just ask who was at the I wasn't able to attend this the me arising and like how it went. Did anybody go? I wasn't able to go either. Seemed to go really well. We had great weather for it. Uh if you really like
the smell of uh bonfire then it was great. Uh but it seemed really well attended. Uh reports were that the food uh lions and the fire department lions sold out of food. fire department came very close to selling out of food and that's usually a really good barometer
for how the day goes but seemed I think they had over 200 cars at the car show. Um pedal pole seemed well attended. Twins clinic seemed well attended. Plenty of people around. But the director Yeah. They were trying to get
there was like only eight that went through the parade. She expected to not have a lot. It was it was the first year they did it. So I was curious too. Rome wasn't built in a day, I guess. So, we'll see what they put forward for next year, which I
Were there any complaints about the road being closed? Only one. I only had one resident complain, but it's one of those circumstances where I believe that it doesn't matter what you said to them, they were going to be angry about it no matter what. There was no resolution
with them other than don't have the parade. Perfect. At all ever. Other than that, I didn't hear Pete from anybody else. I'm I'm assuming the splash pad went over well in the bathrooms and Yep. Uh went well. Restock them a couple
times or restocked them once throughout the day. Seemed to hold up pretty well. People enjoyed the splash pad out there. Yeah, we're all going out there afterwards. A great day for it. Still looking for a motion to adjurnn.
motion or whatever that came out as. Second. All those in favor? I I I motion carries 4. We'll jump right into the workshop. All right. Thank you. He doesn't want to stay for budget
workshop. Oh, shocked. Shocked, I tell you. So, uh tonight we'll go over the 2026 budget timeline. We're kicking off tonight. And then, uh we won't look at the budget specific. I'll reference it. I'll even have it up for a short period of time for educational purposes, but
going to go through a council development session just getting everybody on board with the uh basics of budgeting and finance for the city as we go into things. So 2026 budget schedule kicks off tonight with the rest of the schedule. What I like to do is rather
than have one giant two, three hour budget session every couple of months, I break it up into these smaller half hourlong segments. That way we keep hitting it go along. Nobody forgets stuff as uh things go along because you hear this once in a three-hour session.
After about an hour and a half, everybody goes deer in headlights because it's budget and finance. I get it. I'm thrilled, but nobody else is. Um but then you come come back a couple months later, what did we talk about? I missed
that. What was that about? So keep breaking it up and go along like that. Uh so the structure of this we generally speaking we take a look at the general fund and the CIP first. The reason being is that at the end of September by law we are required to pass our preliminary
levy and our preliminary budget. And what that means is when you set your preliminary levy you can lower it at the end of the year but you cannot raise it. You cannot go above that. So we want to hit that. Some cities will shoot a little bit above the mark knowing that they will bring it down, but I have
always tried to nail that thing on the head first go around. And historically, I've been pretty successful at that. So, that's why you see general fund a whole lot up front there because we're meeting that September end deadline. Afterwards, we'll still peek at it. We might have
some tweaks here and there as things come in, but it shouldn't be earthshattering major revelations of things. After that, we'll dive into the enterprise funds, which are our utility funds. And uh I like those at the latter half mainly because as we'll get into
with the budget presentation, we get monthly data on our enterprise funds, revenues, and expenditures on that. So, as we get further through the year, that means more data from which to make budgetary decisions on. So, it all really works out in the end. And then on
December 8th, we'll have our truth and taxation public hearing because by state law, we have a very narrow window in which to have truth and taxation and that's the only date it works on uh statutoily. But you we designate the truth and
taxation public hearing at the September 22nd meeting. So when we adopt a preliminary levy and budget in that resolution, it'll have that information and sets the public hearing for December 8th. So with that, we'll get into council development section portion of
it. So we're going to go through is we'll go through revenue expense streams for each of the funds, debt services for each of the funds, which thankfully is narrowing and then uh we'll talk a bit about budget structure and and formation
methodologies on that. So first we'll go through the general fund. Uh the general fund has six major uh revenue sources and that is property taxes, LGA which stands for local government aid. That's an aotment we get from the state every year and we figure
out what the f the true amount is September of each year. But they put out projections for that and they tend to be pretty accurate. uh fire contracts, licenses and permits, cell tower rent, and other and other is a conglomeration
of say interest income off investments, reimbursements from the county for some things. Um just a smattering of small community center rent, things of that nature gets lumped into the other settings. So you can see there that the bulk of our revenue is derived from
property taxes and LGA making up 75 76% of everything we take in. Thankfully, cell tower rent has gone up in recent years thanks to correcting that. So, that's take actually that used to be under other, but I split it up because it's uh generating decent revenue now. I
wanted to call that out specifically. If anybody has any questions, just keep me going here. When it comes to the expenditures end of things, uh it's in uh five major categories, although each of these have specific departments underneath them. Uh so, the five major
uses are general government. So this will be uh elections, city council, administration, uh the community center, uh paying our engineers for general fund type of things, auditing services, legal
services, things of that nature, uh public safety, which is fire department and law enforcement services, as well as building inspections, public works, parks, and our EDA transfer. So you can see there the general breakdown of what portion of the uh general fund
expenditures goes to what. Now in the general fund timing of things uh conversely to the enterprise funds the general fund gets paid I like to say twice a year and that's when you get property taxes and LGI LGA and those come in June and November for property
taxes and LGA's in July and se December. So it's roughly this two parts of the year that we get our influxes of major cash. Fire contracts are in July and December. Licenses and permits as they happen and the expenditures as they happen.
So here is a graphical representation of the revenue and expenditure streams. We generally have pretty flat expenditures throughout the months. But then you see we don't have a lot of income coming in until we hit those
really big payments twice a year. When we talk about fund balances for the general fund and for the enterprise funds, this is why you'll hear me talk about you need to have at least well the state office of the state auditor's
office recommends 30 to 50% of your expenditures as a fund balance at any given time. And that's where this kind of derives from because you're this one same but in a line graph.
You can see that's that's how you're spending and getting your money. So you have to have enough money liquid cash on hand to ride this out to when you get here till you get your influx of cash. Ride it out influx of cash and those approximately six month increments. So
that's why you have that 30 to 50% recommendation in the general fund to ride that out because you're not getting any income from there. Otherwise, when we look at debt service in the general fund, um track it back to 2022
there. This was we had um the the fire station hadn't quite come on yet. It slides into here. Uh this is where we were having the general fund transfer money to the sewer fund to help pay off that debt service.
We had a couple of fire equipment pieces in here and you can see over time that has dropped off and that was by design with debt lading. So the general fund stopped funding the uh sewer revenue. We had some bonds dropped off. So that's where you can see we're dropping down
pretty nicely right here. And then we hit the steady streak for the time bill being being until we figure out what's going to happen with our second street project in 2030 and how that funding scenario will pan out. But uh the three
debts we still have on the books for coming after it'll be the 2023 Milan overlay project that we did. It's the fifth street project that was done in 21 and then the fireh hall. Those are our three outstanding debts in the general fund.
So with that, we'll move on to the water fund. And the enter the enterprise funds get far more simple because they don't the general fund has such a plethora of departments within it because it has to because they're property tax supported. Whereas the enterprise funds get a lot more straightforward. The water fund,
water sales, they account for 91.4% of revenues and the rest is interest earnings and whack fees and penalty payments. Essentially uh water expenditures and are operation and debt service driven where we have operations at 55% that's split up
between the water tower which is a very small amount the water treatment facility which is a slightly larger amount but the bulk of it is in the water distribution system with the expenses in there but debt service makes up 44.8% 8% of that. And when we look at
the debt service, this is when we had talks about the utility rates changing out here in 2027. And we'll talk more about those utility rate schedules as we get into that October range. So this is the sources and uses on the
water end of things. You will see that gigantic uh expenditure bar in August and that is your 44.8% Uh we have one really we have two uh two uh drinking water revolving loan funds from PFA which is public facilities
authority. We have a small one and then we have that really big one right there uh which comes in August. So we take in revenue throughout the year and then in August we make the major debt service payments. So your graph tends to look more like this.
We build, we build, we build, make major debt service payment and then build up to recover from it. with operations in there as well of course. So for the utility funds instead of having 30 to 50% at a minimum they
recommend having three months worth of reserves since you are getting influxes of three months worth of reserves plus debt service payment I should say. So that's why you you're seeing because the utility funds get monthly influxes of cash as people pay your utility bills.
It's far more stable and you don't have to go that six-month run uh between getting your major sources of funding. As mentioned, the debt service for the water fund, we have uh the large right
here and then in 2026 is our last payment on that and 2027 it drops off. We don't have any major projects for the water system. Treatment plant is in a good condition. Water tower is in good condition. Wells are just fine. the distribution system is in good
condition. Um, I've had when Kyle and I were reviewing this, this is one thing he and I went over quite a bit because usually in situations like this, if you have something, you would debt ladder at this point. And debt lading means when you have something fall off like this and you add something new so you have
stability here. But we really couldn't think of anything that we would really need to debt ladder for in in the near short term f or near to medium-term future on that. So this is what we expect to happen for a while unless there's a street project that might bump it up a little bit but it wouldn't be
that much. When we look at the wastewater fund we see something very similar. Wastewater sales account for 88.4%. Why it's lower than the 91% we saw in the water fund. That's mainly because the wastewater fund currently has about $2 million in it and that's generating a
lot of interest income for us more so than the water fund. So that's why you see that variation in there. Wastewater expenditures are for operations only. It doesn't have any debt anymore. Last year was the last I think last year was the last debt service payment we
made on it. Uh so for the operations are split into lift stations. Uh the wastewater treatment facility itself and the collection system. Um by contrast the water wastewater treatment facility is far more expensive to run than the water system water treatment facility.
Since we have no debt in here, it's pretty constant across the board. We don't have any major payments really that it's going to cause variation like you see in the water fund. So, it looks something like that. And as we discussed in counts previously, that's a big upward trend because we're expecting the
wastewater treatment facility project to happen as soon as PA gets in line and we square that all up. Until that happens, uh, we're keeping those rates stable because we know the debt's going to come back on and then the rates will absorb that impact. So, we won't have to change
it a ton hopefully. But, weren't we going to adjust water? Yes. Because that was going to offset the increase of wastewater. Yep. So if we need to increase rates on the wastewater things, we time that to
2027 because at 26 will be that last big the last big payment. So here we can drop water rates down. But if we need to add I don't have a debt service graph because there is none, but if we need to add debt service on the water end of things, the the
overall bill for the the community member, that's all they care about. They don't necessarily care that water went up and sewer went down. I go, I'm paying 70 bucks a month now and I want to keep paying 70 bucks bucks a month or there too. So rather than making adjustments
now, so you could drop sewer now, which would be great, but in another year or two, you'd just be jacking it back up with water coming in variation there. So to keep it nice, steady, predictable, keeping that on the hole. Oh, I'm sorry. I did have that graph. We
were doing a look back. I forgot. So that's debt service on the sewer fund. Our last payment was in 24 and then it just went to nothing. And somewhere in here we'll not as much because this required the general fund to contribute towards it. This will be
more in the 140,000 range. I would bet we're looking at maybe a bit more depending. But we'll see how that all plays out. For the storm sewer fund, it's even simpler. um revenues, 91.4% of revenues.
Expenditures are only engineering and maintenance. And those seem like really huge numbers that eat it up right up until you look at the vertical end of things where you're talking 7,000 bucks a month tops. So, it's a very small fund, but it does get spelled out on its
own because it is a utility fund. So, we parse that out, but far smaller numbers on the whole of the year. generally trends upward. Most of the work happens in the summertime. That's when they'll go out there. They'll do their monitoring reports
because we're restoring the wet land down here by mayor lumber. That's when the contractors will go out and if they have to do seeding or eradication of invasive species in there as we work towards our goal of selling those uh credits we get, which we haven't sold any of.
Then we move on to talking about the BR budget structure. And this is where we get more more of the nuts and bolts of things. So a city's accounting code structure, it's set up into three components, which is the fund code, the department code, and the object code.
And the progression of these tell you exactly what you're dealing with in the budget. And it's always fund code, department code, then object code in that order. The fund codes, they are divided out into three-digit designations. And this is the whole slew of the general
categories. So 100 is the general fund which is property tax supported departments. 200s are special revenue funds. Special revenue funds they function like their name says. A special revenue source comes in to pay for the expenses of that. EDA is a good one on
this. When we got the COVID funds, that's an excellent example of a special revenue that we received. We spent it on very specific things. So that's where those generally go. Debt service funds are exactly what that sounds like. your 2023A for the street reconstruction,
your fire station, fifth street bond payments come out of there and they are given 300 codes. 400s are for capital projects funds. That's where we talk about the CIPs are generally found in here as well as when the fire station was being constructed. It's a 400 level
code. 500 are permanent funds. We don't have any of these. These are endowment funds. So you can spend the interest earnings but you cannot spend the principal. We have nothing like that. So we don't have any 500 funds. 600s are the enterprise funds or we call them
utility funds. So water is 620. Uh sewer 640 and uh storm sewer 650. So those are all lodged in there. 700s are internal service funds. We don't have any of these. Um a good example these come into play in larger cities. Uh you have a big
fleet of vehicles and you have a shop that maintains your vehicles. An internal service fund. That shop would be an internal service fund to track. Are you fixing a water truck? Are you fixing a sewer truck? Are you fixing something for are you fixing snow plows? And you would keep internal accounting
of that to make sure you're allocating costs between those accordingly. 800 are fiduciary funds. Uh for us, this means our escrow funds. So we keep money on behalf and it's for a very specific purpose and then we let that go when we
need to. For us, it's our escros that we take in for building permits and things of that nature. 900s you, it reads as governmental activities. The better description of that is the auditors use the 900 codes to do their balancing worksheets when they're working through their audit. Those that's the only
people touching. We do not touch 900 codes. When you get to the department end of things gets broken out a little bit more and I won't go through all of these uh but those are uh in uh five digit designations. They're all 40,000s. So a
little bit more. Your 10,000s are current a current assets. Your 20,000s are liabilities. Your 30,000s are revenues which will come next on the object. And then your 40,000s are department codes across the board.
So those you have to split up into the your different segments. So you look at the first two numbers will tell you a lot. Public safety for example 42 42200 is for our fire department. 42100 is for law enforcement contract services. When
you look at the budget when we look at the object code like I said they're split into actually two on this one. There's a five-digit one when we talk about revenue object codes and then there are three-digit uh when we talk about expense object codes when you see those in the budget.
So that's where I'll reference the budget here real quick. So here you can see right there 100 that's the general fund 41,000 general government 31,000. So the this descriptor here is always the last one.
So 31,000 if you see it any other place in the budget it will always be general property taxes so on and so forth. So we get down here 42,000 42100 here. So this would designate general fund under public safety specifically law
enforcement refunds and reimbursements. Uh this is our we get it from the county for what's the regulatory board for law enforcement? I'm blanking on it. Anyway, they give a reimbursement and the county
gives that back to us since it comes direct from the city. Uh post, that's what it is, the post board reimbursement on that. And then we go down into the expenditure end of things. Again, you see 100 here, the account code, and then the three digit for office supplies,
engineering services. And actually the I'm not going to go into detail, but your 300s are a certain thing, your 200s are a certain thing, your 100s are a certain but that's getting way too far into the weeds. When we look at the water fund, that's where you'll see your 600 account code.
620 designates all that. 4,900's align with um Oh, we see down here miscellaneous and proprietary. proprietary, enterprise, utility, all have the same meaning for
that. So there are your object codes on that. For mayor, we have 18 funds within our accounting system. We don't deal with all of them on a budgetary basis because a lot of these do very very specific things. Um the debt service funds we don't worry about because we levy the
funds to pay them and the money comes in and the money goes out. There's not too much to do there. Escrows are money in money out. But there you have your general fund. And some of these 200s are not like the others, like they're special revenue funds, but we have fire department CIP
and park CRP, which are coded as 200. I assume that sometime in the past, the funding sources for these two were vastly different from what they are now. Now, we levy for them. They should technically be in the 400s, but there's they were originally created at 200s.
One day down the road, we might reassign those, but it's not a higher priority. doesn't really funky things up or anything. Um, so those could get shifted over at some point. There you can see the CIPs are generally in there. Debt services are all in the 300s.
Utilities are all in the 600s just as they ought. So we talk about budget for any questions on anything thus far? All right, wrapping up here. When we talk about budget methodologies and formation process, uh there are
generally there are more but three major methods of doing budgets are incremental budgeting, program budgeting and zerobased budgeting. Incremental budgeting you can think of that is if you have a budget like this, whatever you budgeted
here, you slap a percentage on 3% increase everything by 3% and call it a day. It can be useful if you have very very very stable budgets where everything's very predictable and you can do things like that. I don't much care for it because I don't think it's precise
enough. Program budgeting tends to be used in larger cities, think Minneapolis, when they have a ton of programs for things and they need to keep track of inputs and outputs uh where they want to report out to citizens on how various programs are doing. Mayor does not have a lot of
programs. We have departments that do various things. We don't have a whole lot of programs. We have a couple, but not enough to make program budgeting worthwhile. The one we use, the one I like to use is zerobased budgeting. But I want to do an honorable mention for bottomup budgeting, which we do
incorporate in spirit, not necessarily in practice, but bottomup budgeting is where you go down to your department heads and you ask them to create budgets and then submit those up for consideration to the finance department. we do something like that where I meet with my department heads as the budget
process happens to discuss if there's anything in there that I need to be aware of why it's simply an honorable mention is a lot of the budget forms forms itself I would say there's very like electrical utilities wages with
withholdings health insurance payments a lot of that is already pre-calculated we have a really good idea what's what that's going to be but I still consult with my department heads just in case there might be something that's happening in the next year that I need to be aware of that we need to adjust the budget for to take into account.
So, like I said, we I go with zerobased budgeting, which means what I do is I wipe all these numbers to zero and I build them all back in. and I go into
our accounting software system and I look at each one of these to figure out what it ought to be, what has been in there historically, what comprises them. I look at trends of things um and build it back up from there because you might have a year where it spikes and I ask the question, well, why did it do that?
Rather than simply slapping 3% on top of it and calling a day, ask all the questions. I can pull up all of those transactions, see what we actually spent money on, and go, "Okay, all that makes sense." So, if you get some things that remain consistent,
that's generally why I look at those, I go, "Yep, all the things in there make sense, and that's why it's 3500 bucks versus 4,000 versus less." If I see anything in there that maybe we have discontinued or maybe we're going to be doing something that adds a cost, making
sure we're tweaking those accordingly. So that's how I like to do things. That's what the bottom up wrapped in where I'll meet with Andy, meet with Kyle, talk about what they're seeing on the utilities and fire department end of things. For my revenue assumptions, uh so beyond just zerobased budgeting and
building up from scratch every single time, uh revenue assumptions, uh I always start with levy remaining constant. So when I build in the budget here, this number I owe. So 2025 when I started, I copied it right to 2026.
Meaning I want taxes stay the same, not up, not down, have those anchoring points. Uh beyond that, I will do three-year look backs to determine trends longer if I seeing variance in things uh to determine where that may be. Good one on
that is building permits. I'll keep a running track of what that is because that can vacasillate depending on how many open lots there are versus what we're seeing in miscellaneous rather than just not uh new builds but um a lot of the other miscellaneous permits we get on there. That adds a lot of revenue
that we get. So, we'll take a look at those. Um I will budget accurately when the data is available in concrete to do so. But if we're working more off trends versus concrete data, then I will always budget under on revenues when it's
determined from trends. So if the trends are suggesting 60,000, maybe there 55, 60, 58, I will then go with 55 or slightly less on revenues. The idea being I don't want to count on something having it coming under and now we're
caught short on funding. So conservative on the revenues. And for the uh expenditures, it's the opposite. If I have trends, I'm going to figure a little bit higher. That way, your revenues should come in a little better and your expenses should come in a little lower. You're giving yourself a little comfort there. Not a lot. It's
not, you know, want to not building fluff or anything. I don't want that to go out there. But I think it's just good basis for doing things. Again, on the on the assumptions, everything starts from zero for the zerobased budgeting. Three-year look back again on that. And the same principles apply
on that end of things. So that's how I work when I do the budget on things. This all wraps up in our overall levy picture and this into this spreadsheet that you guys get to see all the time.
Um the overall because this builds we look at the what we give to the general fund to fund general fund operations CIP and the debt service that we levy. All those come into what ultimately forms the property tax statement. How much uh the citizens uh money we uh take from
them in order to fund what we do. Um when we look at all of that, we uh that helps us determine rise, fall, or reallocation of the levy. So when I'm putting this together, I'm starting to look at, you know, we copy the general
fund over into this. Okay. As I build out the budget, I'm working on that. How is that starting to look as we approach adjustments to things? All the yellows are highlights and I'll make notes on this when we actually get into the weeds on it. But right now, just
knee-jerking it. Currently about 15,000 revenues over expenditures as I'm looking at it. As the more things come in, that will tweak. That's you take that with a grain of salt. But since then, I've adjusted that down to kind of bring that gap closer. That then bleeds
over into this spreadsheet. So that starts getting us an idea of what we're looking at for total levy debt service. This one is pretty rock solid. We know what this is going to be. We get schedules on it. This has uh some variation on it. That's
why you see in 2025 when it jumped up. This was a philosophical decision we made that when you look in the debt service, you have a fire tanker. There was uh some the 2015 A1 had as part of it had some
uh fire equipment in there. The decision was made that we want to fund the CIP so that when equipment comes due, we pay for it outright. We're not paying for issuance costs of the debt, uh the overhead on that. We're not paying interest on it. We want the money in the bank so we can buy the equipment when it
comes around so we're not having to pay extra on things. So that's where we see the bump up on that. streets. A little uh little little variation on this. I guess a little history here. You can see it used to be lower. I think it was about 2019 2020 in that area. A lot of
the CIP was built within the general fund itself. It wasn't separated out and that causes budget fluctuations come out of time. If you spend a lot one year, it's looks like you spent a lot, but then if you don't the next year, it drags it way down. proper way to do things is you pull out those capital
expenditures into their own funds. Let the general fund be operations only then it becomes very stable and predictable from that standpoint and then you can do CIPs for each of those. So you see these were somewhat funded. They got pulled out in this time frame
and then as time went on we got really into making sure we build those CIPs, figure out what is in those, what we want to fund and getting funding levels to the point that we're accomplishing those goals. So that has gone up over time, but that coincided very nicely with our total
debt dropping by quite a bit. So things married up very well in that regard. Uh so as we look to the future here looking what the levy was doing we had getting stability here and now we're entering a nice stable period
as we hit 2026 around this and then when I do here and after this is just a 4% inflation inflator on the general fund the rest stay as is. So 20-27 will be actual figures just as this as 26
originally had a 4% inflator on this but now we get to the actual numbers we'll adjust accordingly and that's where we can see reallocation of funds. Um since we knew this was going down and we're seeing better revenues and things. um looking at
streets potentially going up, parks going up to fund some of those being stable in this these areas. Uh whatever the council's goals and wishes are for how they would like to see their levy change.
Um so with that, that's the last slide I have on that. So we're approaching our hour mark for the meeting. I like to keep these things hour or less. So excellent. Seems really solid. Yeah, thank you for putting this together and you know, ever since you
came in and started doing zerobased budgeting um and thank you for the education on it. So now I understand it and I think it's really allowed us a lot more flexibility and I feel like we're in a really good financial position. Um but
we also did plan that with a lot of the levies or a lot of our bonds getting paid off. Um, so like even when we decided on the fire station, there was a lot of consideration on on bond payments. Yes. So that we could maintain property taxes.
Absolutely. And that was smart decision making because you can see I'll point out the fire station specifically to that. Excellent point. You can see down here these were interestonly payments and you can defer those principal payments when you see things like this occurring. We had the 2014A
that was dropping off. So you see that amount drops off and then this jumps up and that's done by design. Yes. So you're not causing a wild fluctuation in this that jacks tax rates through the roof. Yep. Smart decision making.
Any other questions, comments on that? If not, next time we'll jump more into the weeds on this. I'll send out the budget uh as I normally do with all the changes and we'll start hammering away at it. So next time it'll be a longer then afterwards it I think it gets progressively shorter as things become
more tweaks rather than wholesale changes on things. Perfect. Then we are adjourned. Good job Chad. You did a great job. You could have done it. Who would have let you after your day today?