Loading...
HomeMy WebLinkAbout1975-06-04 Council Minutes4 • AC1lNUA 1. ,. REGULAR MEETING, KENAI CITY COUNCIL. f JUNE 4, 197S • 8:00 P.M. NATIONAL GUARD ARMORY PLEDGE: OF ALLEGIANCE k. A. ROLL CALL: � 1 AGENDA APPROVAL B. PUBLIC HEARINGS: 1. Ordinance 264-75 - Annual Budget for Fiscal Year 197S-76 2. Ordinance 265-75 - Amendinp, definition of "Taxicab" $ estaiaishing size and body style restrictions for taxicabs. 3. Ordinance 266-7S Hater/Sewer Rate Increase 4. Ordinance 267-75 - Sales Tax Increase 6. C. PERSONS PRESENT SCHEDULED 7.0 BE HEARD: I 2. — 3. D. MINUTES: 1. Minutes of the Regular Meeting of May 21, 1975 E. CORRESPONDENCE: ' ' F. OLD BUSINESS: a . 1. Resuluti:,n 75-24 - Fixing TaAl cab Rates for flit City of Kenai 3: Council approval FAA Housing inventory i _ { 4. - G. NEW BUSINESS: 1. Bills to be paid - bills to be ratified. ' 2. Payment to Engr. Consulting Firm - Airport -Lighting Project 3. Payment to Engr. Consulting Firm - Airport Fencing.Project 4. Payment to Engr. Consulting Firm - Airport Fencing Project S. If 6. 7. 1t 10. q H. REPORTS: 1. City Manager's Report d 1. 2. City Attorney's Report 3. Mayor's Report 4. City Clerk's Report S. Finance Director's Report " 6. Planning $ Zoning Commission's Report i{ 7. Kenai Peninsula Borough Assembly Report I: PERSONS PRESENT NOT SCHEDULED TO BE HEARD: 1. 2. i f r ® 4. , i I i I r Y i 1" MINUTES - REGULAR MEETING KENAI CITY COUNCIL JUNE 4, 1975 - 8:00 A.M. NATIONAL GUARD ARMORY The Council gave the Pledge of Allegiance ROLL CALL: Members Present: Richard Morgan, H. J. Steiner, 0. L. Thomas, war Ambarian, James Doyle, A. L. Hudson, and James Elson. Members Absent: None AGENDA APPROVAL: B: B-1: MOTION: LAU There were no additions or deletions to the Agenda. PUBLIC HEARINGS Ordinance 264-75 - Annual Budget for Fiscal Year 1975-76. Councilman Ambarian moved, seconded by Councilman Hudson, to amend Ordinance 264-75 as follows: "A. Change the mill rate in Section 1 from 18.9 to 18.0. B. Delete Section 2 and replace it with the following: Section 2. The sum of $1,783,510 is hereby appropriated for corporate purposes and objects of the City of Kenai for the fiscal year commencing on the lst day of July, 1975, and ending on the 30th day of June, 1976, to defray all expenses and liabilities of the City during the fiscal year." Motion passed unanimously by roll call vote. Mayor Elson explained to the general public the situation of the budget as proposed and advised that over $700,000 requested by various City Departments was cut from the budget. Mayor Elson then recessed the meeting and opened it to the public for their imput and comments. Mrs. Linda Dunckley - Requested that the City Council just increase the mill rate by 1 to fund the debt service only. Mrs. Dunckley further stressed that the budget as proposed had an ineffective animal control program, too high a millage rate that would make it difficult to sell homes in the City and also people living outside the City limits should aid in the costs of running the City. Mrs. Dunckley also questioned the accrued Annual Leave as shown in the budget. 0 MINUTES, KENAI CITY COUNCIL, .TUNE 4, 1975 PAGE Z Finance Director, John O'Connor explained that it was a requirement by the American Inst."Aute of Certified Public Accountants that municipalities must show actual accrued annual leave for all employees for each budget year. Mrs. Dunckley also questioned the increase in sales tax and felt this would force buyers to purchase outside the City. Mayor Elson explained that the increase represented It to debt service, 1% to past deficits and 1% to operations. Mrs. Waldo Coyle - Why are there past deficiencies? Mayor Elson referred to the Summary Page of the budget - they occurred because hard cash did not develop from inter - fund transfers. Mr. O'Connor further reiterated that payments made to the General Fund from services rendered from other funds (Airport, etc.) which did not develop into hard cash as explained by the Mayor. Also, the Water/Sewer fund had a $150,000 cash deficit as of April 30th. The City has eliminated IOU transfers from one fund to another. The Water/Sewer rates are far inadequate to support the fund. Mrs. Karen Hornaday - Mrs. Hornaday posed many questions to the Council on such items as what is the total debt service for 74-75? The total anticipated for the balance figure for deficit as of June 30, 1975? According to the Annual Audit Report of 73-74, what is the City's financial situation? When was the Council aware of the City's financial situation according to the 73-74 Audit? Would the Council make any changes in the budget to keep from overspending? Has the Council determined a specific deficit amount? Has any deficit figure been added to the proposed budget? How many mills have been placed in the contingency fund? Mrs. Hornaday was advised that the total debt service for 1974-75 was $507,360. The deficit as of June 30, 1975, is $150,000 and according to the audit report there was a $50-$60 thousand dollar deficit. The Council was aware of the City's financial situation when the audit report came out - October 10, 1974. 1 mill - contingency fund. Mrs. Hornaday suggested that Council determine an exact deficit figure, she disagrees with any contingency figure, and with the increase in mill rate, there should be no sales tax increase. Mayor Elson advised the audience that the proposed budget did not show any increases, merit or otherwise, for City employees. Mr. Johnston Jeffries - will the sales tax increase be submitted to the vote of the people? Mayor Elson explained that Kenai is a Home -rule City, r E _­ 0 MINUTES, KENAI CITY COUNCIL, .JUNE 4, 1975 PAGE 3 therefore, by action of Council such amendments, deletions, etc. can be authorized. Mr. David Thornton - felt the City has many reasons why it is in the financial shape its in now as he is just one of the citizens that owes the City for assessments on something he did not want. Mr. Thornton stated he was not asked nor did he ask for water and sewer in front of his home. He is definitely in opposition of an increase in taxes. Myrna Davidson - what has happened to the remaining funds from bond sales? Councilman Steiner advised the funds were used to finance Gen. Fund activities because of short -falls in cash revenues. Mr. Harry Gaines (representing Kenai Chamber of Commerce Retail Merchants Association) - stressed opposition in an increase in the sales tax. The merchants felt that shoppers would purchase out of Kenai, new businesses would hesitate to develop within the City and it was the feeling of the merchants that Kenai businesses were being used to accomplish a goal. Mrs. Ruth Parsons - Why does the library have such a small budget when it serves a much larger area than just Kenai proper itself? Mayor Elson explained that the library has very little funding from outside. A good portion of the library's funding is in -kind match. Mr. George Navarre - the City had a $1.4 million dollar deficit at the beginning of the year which has been reduced. A 3 percent sales tax plus a mill rate increase is too much inflation. Employees should have merit increases but funding should not be in the contingency fund. City Administration should find out the reason that Federal funding has been cut back. City Manager Lynn advised that as the $1.4 million deficit had been reduced to $lS0,000, the City was counting on revenues from various funds which did not materialize. In other words, funds such as the airport, water/sewer, and so forth did not generate enough revenues to pay for the cost of providing them. The General Fund was relying on these funds and the Operational Fund overspent which created an approximate $SS0,000 cash deficiency. Councilman Thomas stated that the $1.4 million dollar deficit reduction was a paperwork reduction. Mr. Roger Meeks - requested more detailed information as to how the Council had arrived at the decision to increase the sales tax and mill rate and added that a 40% increase in property tax would not be as effective as a sales tax. 1 I 1 MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PAGE 4 Ida Mae Bassett - Mrs. Bassett stated that a sales tax increase would hurt the community. ?sir. Jesse Wade - as a concerned citizen, Mr. Wade felt the City is giving an over -degree of service which is not wanted for the price it will cost the taxpayers. Mr. Wade felt the citizens would rather go back to methods of the past as many do not want such services as water/sewer, etc. Mr. Lynn advised that the proposed budget was increased only by 10% over last year's and this budget will only provide payment of debt service and the Public Works and Police departments are the only ones that will benefit from the increase. The Fire Department staff has been reduced and the City Administrative staff reduced. Councilman Steiner asked Administration how many employees in the City last year and how many this year? Mr. Lynn replied that there were 50 positions last year and 49 authorized for this year. Mr. James Hamilton - inquired as to the reason the City Public Works budget was the same as the Boroughs and asked for a break -down of wages. He also stressed that he felt he was receiving poor services (street plowing, animal control, etc.) and that the community deserved more service for such a high budget. Mr. Alex Connors - Mr. Connors lives in Thompson Park and receives only limited services from the City, therefore, why couldn't the people living in the outlying areas be taxed less -- according to the services they receive. Mr. Art Evans - his main concern was that with the in- creased taxes, construction would be forced outside the City. Mr. Evens had some suggestions for cutting down -- were to u3e the Public Safety Building offices for City Administration, cut down on communication costs for the City, fully utilize the Dispatchers as clerks, etc. and rent out the office spaces in the Terminal Building. Mr. Lynn did advise that the communication budget would be cut considerably ($300/month) when the PBX was taken out -- this should occur sometime in July. The Communication Center in the Public Safety Building will be moved to the Police area wherein the Police secretary will be utilized as a dispatcher also. The City is in the process of negotiating for a State Jail Contract to use the present facilities in the Police station. Mrs. Waldo Coyle - stressed the fact that an increase in taxes would decrease the building and construction in the City. The Council should revamp the budget so that an increase in taxes is not necessary and start running the City on an even keel as was done in the past administration of the City. MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PAGE 5 Mr. George Navarre - Asked Administration the source of expected revenues? Mr. O'Connor wdvised that one of the main sources will be foreclosures on assessments. Mr. Nels Kjelstad - questioned the water/sewer fund and the $115,000 transfer from the fund -- on what basis was it computed? Also, the City repeatedly increases water/sewer rates and there is no basis for a 33% increase as nothing has been done --no new well, etc. What will the people get for what they pay in? Mr. Kjelstad suggested that new assessment districts put in the money for the water/sewer fund instead of the same people year after year getting stuck with supporting the fund. Mrs. Phyllis Morin - had the Council discussed a time limit on the increase in taxes -- will they be reduced at the time the deficit has been reduced? Councilman Thomas advised Mrs. Morin that yes the Council had discussed such a . ! situation and if everything went well there might be a tax reduction. Mr. O'Connor also stressed that this time - limit would depend on how fast the Council wished to act to reduce the deficit. Councilman Morgan reminded the public that the present Council could not commit a future Council for a reduction of taxes and the matter would have j to be taken up at the time a reduction could be conceivable. - Y= Aft Mrs. Karen Hornaday - asked that the Council give an estimate on the deficit? Mr. O'Connor advised that a representative s, of Peat, Marwick, Mitchell F Co. had spent time with City Administration and had arrived at an approximate figure of $180,000. Thomas Wagoner - felt there were several areas that the budget could be cut and though he had not had the opportunity to study the proposed budget, perhaps the following areas could be cut. (1) Public Works budget - $72,000 Front End Loader. (2) City Attorney - contract this service out. (3) Cut number of employees. I , At the request of Council, Mayor Elson declared a recess for ! 3, ten minutes at 11:00 p.m. At 11:10 p.m., Mayor Elson declared the meeting open and - returned to the Council table. F, Councilman Doyle stated he would support a decrease in taxes when deficit is paid back. ---F=. Councilman Morgan advised that he had called various cities -- - within the State of Alaska and compared mill rate and sales taxes. If Kenai were to adopt the increase in sales tax, it would have the highest tax in the State. With the new mill rate, Kenai will be second only to the City of Seward -'-t for the entire State. Councilman Morgan felt that there were several areas in which the budget could be trimmed -- communications is very high, Public Works Department could MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PAGE 6 have some deletions or cuts. Councilman Morgan had talked with the Borough and they indicated that an Ordinance would be presented on July 15th for decrease in sales tax (effective October, 1975). Councilman Steiner concurred with Councilman Morgan that there was a very strong indication that the sales tax in the Borough would be reduced -- there is also strong support removing it altogether. Councilman Thomas asked if Councilman Steiner advocated approval of the proposed sales tax contingent upon the Borough's decision? There was an expression from Council members that this could indeed be taken into consideration. MOTION: Councilman Morgan moved, seconded by Councilman Steiner, to delete the front-end loader from the Public Works Department's budget. At this time, Councilman Hudson expressed his opposition to scattered cuts throughout the budget. The motion failed by roll call vote. Voting no; Ambarian, Doyle, Hudson, and Elson. Voting yes, Morgan, Steiner, Thomas. MOTION: Councilman Morgan moved, seconded by Councilman Steiner, to delete the position of Trainee as requested by the Public Works Department in the proposed budget. -' Motion failed by roll call vote. Voting no; Thomas, Ambarian Doyle, Hudson, Elson. Voting yes; Morgan and Steiner. MOTION: Councilman Morgan moved, seconded by Councilman Steiner, to delete $10,000 from the City Attorney's proposed budget. Motion failed by roll call vote. Voting no; Ambarian, Doyle, Hudson and Elson. Voting yes; Morgan, Steiner, and Thomas. L MOTION: Councilman Morgan moved, seconded by Councilman Steiner, to delete $10,000 from the Communications budget. {"T Motion passed by roll call vote. Voting yes; Morgan, Steiner, Thomas, Ambarian, Hudson, and Elson. Voting no; ` J Doyle. MOTION: Councilman Morgan moved, seconded by Councilman Steiner, '- to delete $20,000 from the Contingency Fund. Motion passed unanimously by roll call vote. -`` MOTION: Councilman Morgan moved, seconded by Councilman Steiner, that the Sales Tax revenues be reflected at $230,000 per 1% per year instead of $180.000. e) .s MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PACE 7 Motion passed by roll call vote. Voting yes; Morgan, Steiner, Doyle and Elson. Voting no; Thomas, Ambarian, and Hudson. MOTION: Councilman Steiner moved, seconded by Councilman Doyle, as follows: 1% effective July 1, 1975, with the total of 3% being effective October 1, 1975. Motion passed by roll call vote. Voting yes; Morgan, Steiner, Thomas, Doyle, Hudson and Elson. Voting no; Ambarian. Mayor Elson suggested the Council table Ordinance 264-75 until other matters which will affect the budget are decided. MOTION: Councilman Steiner moved, seconded by Councilman Ambarian, to table Ordinance 264-75. The motion passed unanimously by roll call vote. B-4: Ordinance 267-75 - Sales Tax Increase �f MOTION: Councilman Steiner moved, seconded by Councilman Doyle, f to amend Ordinance 267-75 to read as follows: Under Section 7-27 (b) should read..."one-fourth of ` all..." Under Section 7-27 (c) should read..."three-fourths of all..." Motion passed unanimously by roll call vote. Mayor Elson recessed the meeting and opened it to the public. Mr. Art Evans requested that Council clarify the change in the figure from $180,000 to $230,000. Councilman Morgan had discussed the matter with the Borough and felt this was a more realistic figure. Mr. George Navarre stated that he felt the figure of $180,000 was the realistic figure to look at. He is opposed to an increase in sales tax and would then favor an increase in mill rate but not both. MOTION: Councilman Morgan moved, seconded by Councilman Hudson, MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PAGE. 8 to amend the amendment to Ordinance 267-75 as follows: Section 7-25 (addition of (b) - Effective October 1, 1975, there is hereby levied a consumers' sales tax of an additional two percent on all retail sales, on all rents, and on all services made or rendered within the City limits within the City of Kenai, measured by the gross sales price of the seller. Under 7-27 "DEDICATION" should read as follows: (a) The revenues from the tax collected under Section 7- 25 (a) are dedicated to retire the general obligation bonds authorized at that certain special election held in the City of Kenai on the 25th day of May, 1971. It is the intent of this dedication that the proceeds shall be used exclusively for the purposes of repaying, retiring or otherwise discharging the City of the obli- gations of the bonded debt or obligation assumed pur- suant to the authorization of the special election. (b) One-half of all revenues of the consumers' sales tax levied by Section 7-25 (b) is dedicated to be applied to the debt service fund, to enable the City to meet its cash restriction requirements as provided for in various bond ordinances. (c) One-half of all revenues of the consumers' sales tax levied by Section 7-25 (b) is dedicated to be f applied against current operating expenses." i f Motion passed by roll call vote. Voting yes; Morgan, Thomas, {' Hudson, and Elson. Voting no; Steiner, Ambarian and Doyle. MOTION: Councilman Morgan moved, seconded by Councilman Hudson, for adoption of Ordinance 267-75 as amended. Motion passed unanimously by roll call vote. B-3: Ordinance 266-75 - Water/Sewer Rate Increase MOTION: Councilman Morgan moved, seconded by Councilman Hudson, to amend Ordinance No. 266-75 by the addition of the following: SCHEDULE H-WATER AND SEWER CONNECTION FEES (a) A tap fee of $400 shall be charged for connection to the municipal water system by a 3/4 inch or smaller water line. (b) A tap fee of $400 shall be charged for connection to the municipal sewerage system by a four inch or smaller sewer main. (c) A charge for any connection larger than a 3/4 1!I MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PAGE 9 inch water line or a 4 inch sewer main shall be established by special contract. Motion passed unanimously by roll call vote. Mayor Elson recessed the meeting and opened it to the public. Mr. Nels Kjelstad stated he did not agree with an increase in rates and still had not received a satisfactory explanation of the figure of $115,000. Mayor Elson called the meeting back to the Council table. MOTION: Councilman Steiner moved, seconded by Councilman Ambarian, to amend the amendment of Ordinance 266-75 by adding the following to Schedule H - Water and Sewer Connection Fees. (d) The funds collected under this Schedule shall be reserved for water and sewer capital improvements. Motion passed by roll call vote. Voting yes; Morgan, Steiner, Thomas, Ambarian, Hudson and Elson. Voting no; Doyle. Councilman Morgan stated he felt that the City could not justify a 331 increase in water and sewer rates. MOTION: Councilman Morgan moved to table Ordinance 266-75 until the next meeting. The motion dies for lack of a second. MOTION: Councilman Ambarian moved, seconded by Councilman Hudson, for the adoption of Ordinance 266-7S as amended. Motion passed by roll call vote. Voting yes; Steiner, Ambarian, Doyle, Hudson, Elson. Voting no; Morgan and Thomas. MOTION: Councilman Steiner moved, seconded by Councilman Hudson, to bring Ordinance 264-75 back to the Council table. The Motion passed unanimously by roll call vote. MOTION: Councilman Doyle moved, seconded by Councilman Ambarian, to amend Ordinance 264-7S by changing the mill rate to 16.75 in place of 18. The motion passed with roll call vote. Voting yes; Morgan, Steiner, Ambarian, Doyle, Hudson, Elson. Voting no; Thomas. MOTION: Councilman Doyle moved, seconded by Colsnci.lman Hudson, for adoption of Ordinance 264-75 as amended. f � � 1 � 1 i MINUTES, KENAI CITY COUNCIL, JUNE 4, 1975 PAGE 10 The motion passed by roll call vote. Voting Yes; Morgan, Steiner, Ambarian, Doyle, Hudson and Elson. Voting no; Thomas. B-2: Ordinance 265-75 - Amendins definition of "Taxicab" and establishing size and body style restrictions for taxicabs. MOTION: Councilman Morgan moved, seconded by Councilman Doyle, to table Ordinance 265-75 until next meeting. Motion passed unanimously by roll call vote. G: NEW BUSINESS: G-1: Bills to be paid - bills to be ratified MOTION: Councilman Morgan moved, seconded by Councilman Hudson, for authorization of payment of bills as presented. The motion passed unanimously by roll call vote with Councilman Thomas abstaining on the KUSCO bill. There being no further business, Mayor Elson declared the meeting adjourned at 2:05 a.m., June S, 1975.