The meeting was called to order by Mayor Cheryl A. Young at 7:30 p.m.

MEMBERS PRESENT:

Marian Calnon

Jan Forsyth

Bill Guy

Gary Hudson

Larry Kanzler

Karen Ladd

Sally Ann Marson

Bob Schmor

Cheryl A. Young

MEMBERS ABSENT:

John Yazzolino

ALSO PRESENT:

Micah Olson, Public Works Superintendent

Mike Reedy, Chief of Police

Leahnette Rivers, City Administrator/Recorder

A quorum was present and due notice had been published.

Mayor Young opened the nominations for the position of Chair.

MOVED (YOUNG), SECONDED (KANZLER) AND CARRIED UNANIMOUSLY TO NOMINATE BOB SCHMOR AS CHAIR.

There being no further nominations for the position of Chair, Mayor Young closed the nominations. Mayor Young called for a vote. All voted in favor of Bob Schmor serving as Chair, and Mayor Young declared him duly elected.

Mayor Young turned the meeting over to Chair Schmor.

Chair Schmor opened the nominations for the position of Vice-Chair.

It was the consensus of the Committee that Sally Ann Marson serve as Vice-Chair of the Budget Committee. No objections were heard. Chair Schmor declared Sally Ann Marson duly elected to the position of Vice-Chair by acclamation.

Chair Schmor opened the nominations for the position of Secretary.

It was the consensus of the Committee that Bill Guy serve as Secretary of the Budget Committee. No objections were heard. Chair Schmor declared Bill Guy duly elected to the position of Secretary by acclamation.

Leahnette Rivers explained that the proposed budget was prepared under the assumption that the City will issue 41 building permits within the Pacific Terrace II subdivision prior to June 30, 2003. She explained that the developer has indicated that all 41 permits will be applied for within the next few weeks. She said building permits directly impact the expense appropriation requirements of the City, which is why the permit activity has been included in the proposed budget. She said if the permits are not issued, the City Council will have an opportunity to reduce the budget appropriations accordingly prior to adopting the budget. She said last week the proposed budget did not include the permit activity, and it still balanced.

Leahnette explained that the proposed budget is conditioned upon a water rate increase proposed for adoption by the City Council with an effective date of May 26, 2003. She said this same rate increase was also included in last year's budget, with an anticipated effective date of September 2002. However, she said this rate increase was postponed and not implemented.

Leahnette noted that the City Council recently updated the Transportation System Development Charges (SDCs). She said the anticipated revenue from the new fees is reflected in this document. She said SDCs are restricted revenues that can only be used to fund the growth-related portions of identified transportation projects. Leahnette said the City received $1.2 million in Federal funding to replace the "L" Street bridge. She said this funding program requires a local match of $300,000, and the transportation SDC revenues can be used for that local match.

Leahnette said the main focus this year in preparing the budget was to build fund balances in light of the current economic conditions, and capital purchase requests were kept to a minimum.

Leahnette recommended the Budget Committee consider approving the following changes to the proposed budget:

Increase (Decrease)

STREET DEVELOPMENT FUND

Revenues:

Miscellaneous Revenue, Interest $2,000

Expenditures:

Reserve for Improvements $2,000

NET INCREASE $2,000

Purpose: To adjust projected interest earnings.

WATER CAPITAL PROJECTS FUND

Revenues:

Miscellaneous Revenue, Interest ($1,000)

Expenditures:

Interfund Transfers Out, Transfer Out to Water Fund $25,992

Contingency ($26,992)

NET DECREASE ($1,000)

Purpose: To adjust projected interest earnings and to return unexpended funds to the Water Fund now that funding for these projects has been secured through a Safe Drinking Water Loan.

WATER FUND

Revenues:

Interfund Transfers In, Transfer In From Water Capital Projects Fund $25,992

Expenditures:

Water System Maintenance $10,492

Equipment $15,500

NET INCREASE $25,992

Purpose: To record the return of unused funds from the Water Capital Projects Fund, and appropriate the funds to purchase water meters, backflow devices, and an automated meter reading system.

WATER DEVELOPMENT FUND

Revenues:

Miscellaneous Revenue, Interest $3,100

Expenditures:

Reserve for Future Water Improvements $3,100

TOTAL INCREASE $3,100

Purpose: To adjust projected interest earnings.

SEWER DEVELOPMENT FUND

Revenues:

Miscellaneous Revenue, Interest $1,150

Expenditures:

Reserve for Future Sewer Improvements $1,150

TOTAL INCREASE $1,150

Purpose: To adjust projected interest earnings.

Leahnette explained that staffing and services levels in the proposed budget remain about the same as in the current year.

Larry Kanzler noted that personnel costs are projected to increase significantly, and he asked what the impact of the PERS rate increase was. Leahnette said the PERS rate will increase from 10.27% to 15.08% effective July 1, 2003. She said personnel costs were also impacted by a projected 20% increase in medical insurance costs, a 1% cost of living adjustment, and 5% step increases for eligible employees.

Larry Kanzler asked if the Council has established an equipment replacement fund, which was discussed in the past. Leahnette explained that the Council had established a separate Equipment Replacement Fund several years ago, and the separate fund has been closed, but the Equipment Reserve continues to be maintained in the General Fund. She said the Equipment Reserve line item appropriation in the proposed budget of $23,381 is up $10,000 over last year. She said she has provided a 12% contingency in the General Fund.

Leahnette explained that the front face of the Community Hall building needs to be removed and replaced, and the extent of the dry rot damage has yet to be determined. She said an appropriation of $21,000 is proposed based upon initial feedback from contractors and the City's Building Official regarding the possible extent of the damage.

Karen Ladd asked if we will be keeping our cigarette tax dollars, or if it has been preempted by the State Legislature. Leahnette explained that the most recent information she had indicated that we would still receive our cigarette tax, but preemption by the Legislature of any of the state shared revenues is an ongoing concern.

Mayor Young said she recently attended Betsy Johnson's Town Hall meeting, and Betsy indicated that they are still looking at all of the funding options they have, including a sales tax targeted at education, and shifts in State income tax including the discontinuance of certain tax credits.

Karen Ladd asked why we need to purchase a shotgun rack. Chief Reedy said shotguns are not carried in the police vehicles right now because they don't have racks for them. He said shotguns are a standard tool used by law enforcement agencies, and fortunately they have not had the need to use one in the past. He said they also carry a non-lethal shotgun, which uses beanbags.

Leahnette noted that the Police Department will purchase the shotgun rack, along with several other small equipment items, with a $500 grant that requires a $50 City match.

Sally Ann Marson asked if there are any appropriations in the Budget document relating to the City Council's Policy Goal and Objective to encourage the development of the vacant commercial property at the corner of "I" and Second Streets, and the soon-to-be vacated church property, for community use. She said the library fees in St. Helens are increasing, and it seems like the children of this community really benefit from the local library.

Leahnette said there are no funds appropriated in the proposed budget directly for that item. She said the church still has a few years left in their building, and we are very interested in the acquiring the building across the street for a library or other community use. She said a citizen survey about the public library will be included in the City's newsletter in an effort to receive feedback that might give us a better idea about the desires of the community.

AGENDA ITEM 4 PUBLIC HEARING: To receive public comment on the proposed budget for fiscal year 2003/04.

Public Hearing opened.

No comments were heard from the public.

Public Hearing closed.

AGENDA ITEM 5 PUBLIC HEARING: To receive public comment on the proposed use of revenue sharing funds for fiscal year 2003/04.

Public Hearing opened.

No comments were heard from the public.

Public Hearing closed.

It was the consensus of the Budget Committee that the next meeting be held on Tuesday, May 6, 2003, at 7:30 p.m. in the Council Chambers of the City Hall.

There being no further business to come before the Committee, the meeting adjourned at 8:12 p.m.

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