06 20 23 Work Session MinutesCity Council Work Session June 20, 2023
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City of New Hope
4401 Xylon Avenue North
New Hope, Minnesota 55428
City Council Minutes
Work Session Meeting
June 20, 2023
Northwood Conference Room
CALL TO ORDER The New Hope City Council met in work session pursuant to due call and notice thereof;
Mayor Hemken called the meeting to order at 6:30 p.m.
ROLL CALL Council present:
Council absent:
Kathi Hemken, Mayor
John Elder, Council Member
Andy Hoffe, Council Member
Michael Isenberg, Council Member
Jonathan London, Council Member
Staff present:
Reece Bertholf, City Manager
Erin Enstad, Abdo
Vicki Holthaus, Abdo (virtual)
Tim Hoyt, Director of Police
Rich Johnson, Director of HR/Admin. Services
Valerie Leone, City Clerk
Stacy Woods, City Attorney
DIALOGUE WITH
PERSONNEL BOARD
Item 11.1
Mayor Hemken introduced for discussion item 11.1, Dialogue between City Council
and Personnel Board.
Mr. Rich Johnson, director of HR/admin. services. introduced Tony Brown and Wendy
Brostrom, commissioners of the Personnel Board. He stated Eric Galstad was unable
to attend the meeting. Mr. Johnson reported the last dialogue was held in November
of 2021. Since that time the Personnel Board has assisted with 13 job recruitments and
reviewed 11 job descriptions. He explained the city is nearly fully staffed.
Mr. Tony Brown and Ms. Wendy Brostrom shared their backgrounds and expressed
their views regarding the job market. It was noted the city has a good reputation which
draws quality candidates. Ms. Brostrom stated employers must keep people engaged
and maintain open dialogue with employees.
Discussion ensued regarding the city’s culture and leadership.
Council thanked the Personnel Board for their expertise.
2022 ANNUAL
COMPREHENSIVE
FINANCIAL REPORT
Item 11.2
Mayor Hemken introduced for discussion item 11.2, Review 2022 Annual
Comprehensive Financial Report (ACFR) with Abdo.
Mr. Reece Bertholf, city manager, explained that Erin Enstad of Abdo is present to
review the audit with Council and Vicki Holthaus of Abdo is available virtually for
questions as well.
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Ms. Erin Enstad, Abdo, provided financial highlights of the 2022 audit:
• The assets of the city exceeded its liabilities by $100,927,731 at the close of the year,
of which $30,306,053 (unrestricted net position) may be used to meet the city’s
ongoing obligations to citizens and creditors.
• Combined ending fund balances were $31,403,877, an increase of $1,349,091
compared to prior year. Approximately 18.3 percent of this total amount is
available for spending at the city’s discretion.
• Unassigned fund balance of the General Fund was $7,655,481 or 44 percent of total
General Fund 2022 expenditures and transfers out. The city’s policy is to maintain
a 42 percent reserve.
• The city’s total bonded debt decreased by $3,522,412 (7.2 percent) during the
current fiscal year.
• The city implemented Governmental Accounting Standards Board (GASB)
Statement No. 87, Leases, in fiscal 2022.
Ms. Enstad reported on the financial position of the general fund and noted the fund
balance decrease was mainly due to transfers to finance capital improvements (transfer
of ARPA funds to the public works CIP for the phase 2 expansion). She reported the
Council approved unbudgeted transfers of $500,000 into the General Fund for Emerald
Ash Borer abatement program and $1,142,382 out of fund balance accumulated in 2021
to internally finance capital improvements.
Ms. Enstad reported the total net position of the enterprise funds (sewer, water, storm
water, street lighting, golf course, ice arena) was $31,949,744, an increase of $2,389,438.
She reviewed the individual accounts.
Ms. Enstad stated the audit will be presented at the next council meeting for formal
acceptance.
Mayor Hemken noted the city may receive higher local government aid in 2023
compared to prior years.
Council thanked Ms. Enstad for the presentation.
2024 BUDGET
Item 11.3
Mayor Hemken introduced for discussion item 11.3, Preliminary Discussion on 2024
Budget.
Mr. Reece Bertholf, city manager, stated there are 19 goals/priorities that were
prepared by staff. He asked Council to advise him of any additions or modifications.
He stated staff is also seeking feedback from Council on the proposed budget and
timeline.
Ms. Enstad reviewed the proposed goals and priorities, budget schedule, local
government aid projection of $1,306,156, central garage funding, administrative
transfers, IT charges, election cost increase, council salaries, employee compensation
and insurance, park and street infrastructure levies, the EDA and HRA levies, and debt
service levies. She indicated no new positions are planned for 2024. Ms. Enstad
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explained the public works facility expansion (phase 2) is part of the city’s long-range
financial plan.
Ms. Enstad indicated three scenarios have been provided showing the preliminary city
levy:
1) 5% general fund levy increase would result in a 3.82% increase of the property
tax levy;
2) 7% general fund levy increase would result in a 5.09% property tax levy
increase; and
3) 5% general fund levy increase and the addition of $100,000 capital funds for
fire, swimming pool, and city hall would result in a 5.40% property tax levy
increase.
She stated for scenario 1 and scenario 2, a $300,000 transfer could be made from the
general fund for the CIP for fire, pool, and city hall. She explained that she along with
the directors and the city manager will be reviewing the proposed budgets in detail
during July and August.
Ms. Enstad reviewed the budget timeline and asked Council their opinion on holding
the budget hearing on November 27 at 6:30 p.m. prior to the regular council meeting
(two weeks prior to the budget adoption meeting). She noted in prior years the budget
hearing was held on the first Monday in December (one week prior to the budget
adoption meeting). Council expressed support for holding the budget meeting on
November 27.
Council thanked Ms. Enstad and staff for the budget information.
VEHICLE LEASE
Item 11.4
Mayor Hemken introduced for discussion item 11.4, Discuss the leasing of an
unmarked vehicle through Enterprise Fleet Management.
Mr. Tim Hoyt, police chief, explained at the March 20 work session, due to market
conditions, staff was authorized to order vehicles planned for replacement through
year 2024 per the CIP (with ratification by Council at a later date). He stated this spring
the Northwest Metro Drug Task Force dissolved. Other task force opportunities are
being explored with the county. Director Hoyt stated the city is able to assume the lease
of the vehicle that was driven by the city’s investigator who was assigned to the task
force. The vehicle is a 2022 Volkswagen Tiguan. The city will save approximately
$5,000 in ancillary equipment set-up and installation costs as the vehicle is already
equipped as an unmarked vehicle. The monthly lease price is $480.67 ($5,768 annually),
and the lease cost would be funded through the central garage vehicle replacement
fund. He requested permission to add the vehicle to the city’s fleet.
Council expressed support and directed staff to place the item on the June 26 agenda
for formal approval.
RESOLUTION
CALLING FOR
CLOSED MEETING
Item 11.5
Mayor Hemken introduced for discussion item 11.5, Resolution calling for a closed
meeting of the New Hope City Council authorized by Minn. Stat. §13D.05, Subd. 3(b)
to discuss and consider litigation defense and settlement strategies with Ashton
Homes, LLC.
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RESOLUTION 2023-82
Item 11.5
Council Member Elder introduced the following resolution and moved its adoption:
“RESOLUTION CALLING FOR A CLOSED MEETING OF THE NEW HOPE CITY
COUNCIL AUTHORIZED BY MINN. STAT. §13D.05, SUBD. 3(B) TO DISCUSS
AND CONSIDER LITIGATION DEFENSE AND SETTLEMENT STRATEGIES.”
The motion for the adoption of the foregoing resolution was seconded by Council
Member Isenberg, and upon vote being taken thereon, the following voted in favor
thereof: Hemken, Elder, Hoffe, Isenberg; and the following voted against the same:
None; Abstained: None; Absent: London; whereupon the resolution was declared duly
passed and adopted, signed by the mayor which was attested to by the city clerk.
ADJOURNMENT The meeting was adjourned at 7:51 p.m. as there was no further business to come
before the Council at its work session.
Respectfully submitted,
Valerie Leone, City Clerk