Based on the context provided and the roll call within the transcript, here is the speaker-identified version of the meeting. *Note: While the provided context list identifies Nick Lien as Mayor, the transcript from September 18, 2023, records him as a Councilmember and Joshua Hoyt as the Mayor. The speaker names below reflect the officials active at the time of the recording.* [0:01] **[Music]** [0:47] **Mayor Joshua Hoyt:** We'll call the city council regular meeting to order for Monday, September 18, 2023. Would everyone please stand for the Pledge of Allegiance? [1:01] **Mayor Joshua Hoyt:** [Leading Pledge] ...to the flag of the United Republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Call the roll, please. [1:23] **City Clerk Shirley Buecksler:** Mayor Hoyt? **Mayor Joshua Hoyt:** Here. **City Clerk Shirley Buecksler:** Councilmember Bernatz? **Councilmember Holly Bernatz:** Here. **City Clerk Shirley Buecksler:** Councilmember Lean? **Councilmember Nick Lien:** Here. **City Clerk Shirley Buecksler:** Councilmember Porter? **Councilmember Katie Porter:** Here. **City Clerk Shirley Buecksler:** Councilmember Wilson? **Councilmember Steve Wilson:** Here. [1:36] **Mayor Joshua Hoyt:** All right, any changes to the agenda? [1:40] **Councilmember Nick Lien:** No. **Councilmember Holly Bernatz:** None. [1:42] **Mayor Joshua Hoyt:** All right, unless there's any changes, I'd look for a motion to approve the agenda. [1:44] **Councilmember Holly Bernatz:** Motion to approve. **Councilmember Katie Porter:** Second. [1:46] **Mayor Joshua Hoyt:** Motion by Holly, second by Katie. All in favor say aye. **Councilmembers:** Aye. [1:47] **Mayor Joshua Hoyt:** All right, moving on to item six, which is our citizen comments. Does anyone in attendance wishing to speak at this time? Seeing none, we'll move on to item seven, which is our consent agenda. Look for a motion to approve the consent agenda. [1:57] **Councilmember Katie Porter:** Motion. **Councilmember Steve Wilson:** Second. [2:01] **Mayor Joshua Hoyt:** Motion by Katie, second by Steve. All in favor say aye. **Councilmembers:** Aye. [2:04] **Mayor Joshua Hoyt:** All right, moving right along, we will go to our public hearings, item 8.1, which is the ordinance amending the 2023 fee schedule with state tax increase effective October 1st, 2023. And Shirley? [2:19] **City Clerk Shirley Buecksler:** Thank you, Mayor and Council, for your review tonight as an ordinance amending the 2023 fee schedule. The state recently added a one percent tax on sales and use that is going into effect on October 1st. It is for sales and purchases in the seven-county area. 0.25 of this tax will support housing projects in the metro area; 0.75 percent of this tax will support transportation projects in the metro area. Uh, at this time, rates have not been changed on the fee schedule—that'll come later in the year. Right now we're just doing the sales tax. What that covers in our 2023 fee schedule, what it affects, is: advertising in the Currents, park facility rentals, Rambling River Center rentals, advertising at the arena, arena fees including open hockey, open skating, skate rental, etc., field use fees, and other services and fees such as ball field dragging and soccer field mining. The rates have been adjusted to the new rate. In your packet, there's a redline version rounded up to the next whole dollar. Council needs to hold a public hearing on this and pass the ordinance amendment. [3:42] **Mayor Joshua Hoyt:** All right, thank you, ma'am. And since this is a public hearing, we will open the public hearing at this time. Do you have any—anyone have any questions for Shirley? Nick? Holly? [3:51] **Councilmember Nick Lien:** No. **Councilmember Holly Bernatz:** No. **Councilmember Steve Wilson:** No questions. [3:53] **Mayor Joshua Hoyt:** And I have no questions. It's a public hearing; if there's anyone in attendance wishing to speak regarding the state's one percent sales tax? All right, seeing none at this time, we'll go ahead and close the public hearing. If there's any additional commentary or statements? All right, seeing none, then I was looking for a motion to approve the ordinance or adopting the ordinance number 23-775, amending changes in fees for licenses, permits, and other city approvals and services for calendar year 2023 to include Minnesota sales tax increase effective October 1st, 2023. [4:34] **Councilmember Steve Wilson:** Motion to approve. **Councilmember Nick Lien:** Second. [4:37] **Mayor Joshua Hoyt:** Motion by Steve, second by Nick. Call the roll, please. [4:39] **City Clerk Shirley Buecksler:** Councilmember Bernatz? **Councilmember Holly Bernatz:** Yes. **City Clerk Shirley Buecksler:** Councilmember Lean? **Councilmember Nick Lien:** Yes. **City Clerk Shirley Buecksler:** Councilmember Porter? **Councilmember Katie Porter:** Yes. **City Clerk Shirley Buecksler:** Councilmember Wilson? **Councilmember Steve Wilson:** Yes. **City Clerk Shirley Buecksler:** Mayor Hoyt? **Mayor Joshua Hoyt:** Yes. [4:47] **Mayor Joshua Hoyt:** All right. New business item 12.1 is the preliminary 2024 general fund budget and tax levy. Chris? [4:55] **Chris Gormley (Finance Director):** Thank you, Mayor, members of the Council. I'm here to present the 2024 general fund budget and tax levy. The budget development starts in early May, runs through July. Management staff submits, reviews, and revises budgets. August-September, Council reviews the draft budgets, provides feedback and input. Then in September, which is where we're at tonight, we adopt the preliminary tax levy—and this year it's by October 2nd. We've got to have it into the county certification. October-November, we review and update the rates and fee schedules, review and update the budgets if necessary, and then the Truth in Taxation statements are mailed out to the residents in early November. In December, we receive public input and adopt final budgets and tax levy. The budget was created and based on the 2024 city priorities of business growth, community engagement, infrastructure support, and employee engagement. When we start crafting the budgets, the first thing we look at is what we are going to spend. Total general fund expenditures have increased by 13.62 percent. There's probably a couple of increases driving that. The first is the increase of the pay plan through the 75th percentile of market. Two and a half new positions are in the general fund. There is an increase in IT service charges, an increase in fleet service charges, and some new software costs in Finance, Community Development, and Parks and Recreation. Once expenditures have been determined, we look at general fund revenues. Revenue shows a 23.54 percent increase over 2023. Licenses and permits show about a 15 percent decrease due to building permit revenues slowing down for single-family homes as a result of interest rate increases. We see increases in intergovernmental revenue of 23 percent, primarily due to municipal state aid, police and fire state aid, and federal/state/county grants. Charges for services show a 20 percent increase due to increased fire service charges and engineering fees. Investment income—I'm very conservative on that based on the last two years; I'm hoping we get at least ten thousand dollars. Miscellaneous shows about a fifteen thousand dollar increase, and transfers in show a 52 percent increase. This is due to a $250,000 increase from the employee expense fund to help offset that pay plan increase to the 75th percentile. Also, there's a $300,000 operating transfer into the general fund to help buy down the levy from the closed bond fund and a capital project fund. Once we've determined expenditures and revenues, we determine the tax levy. We subtract revenues other than taxes and fiscal disparities distribution. We add our EDA Levy—which is the first time the city has an EDA Levy—and add our debt levy of 1.7 million dollars. That gives us our net tax levy of 14 million 300 thousand, or a 12.23 percent increase over 2023. What does a 12.23 percent levy include? For business growth, we have our Economic Development Authority Levy of $150,000. This provides funding for initiatives to strengthen and attract businesses, marketing, and recruitment. We have comprehensive plan implementation and zoning code updates. Within community engagement, we have funding for Police Department engagement, quarterly newsletters, the 2024 general election, and a website redesign. With infrastructure support, we have increased funding for street and trail maintenance, EAB management, vehicle/equipment funding, and accelerated sidewalk replacement. We also have IT infrastructure like new recreation software, building permit software, and Finance/payroll software. We have a new fire water tender, a new roller compactor in Public Works, and fitness equipment for the Rambling River Center. Within the Police Department: increased DCC costs, body and squad camera contracts, and new equipment. For employee engagement: improved pay plans to the 75th percentile, increasing staffing by 2.5 FTEs (two Public Works operators and a half-time grant writer), health insurance increases of nine percent, and increased employee training. We then look at our tax rate. We take the net levy of 14 million 300 thousand and divide that into our net tax capacity of approximately 31 million dollars. We get a proposed tax rate of a little over 46 percent, or a seven percent increase over the prior year. This slide shows a 10-year history. We had a dip last year due to increased market value, and it shows a little increase this year. Our debt service tax levy is 1.7 million dollars. For the average residential taxable market value, from 2022 to 2023, the increase was about 4.4 percent. What is the impact on a Farmington residence? Based on a $339,000 market value in 2023, it was $1,456. In 2024, for a $354,000 property at the new rate, it will be $1,630—a $173 increase over 2023, or $14.44 per month. The action requested tonight is to adopt the resolution establishing the 2024 preliminary tax levy and set the public input meeting for December 4th, 2023, at 7 pm. I'll try to answer any questions you have. [12:35] **Mayor Joshua Hoyt:** Thank you, sir. Katie, any questions? [12:36] **Councilmember Katie Porter:** Um, so just to be clear, when you're calculating the average resident contribution for 2024, you're basing that on a median household? So you said $354,000? [12:49] **Chris Gormley (Finance Director):** Yeah, roughly. That's the median put out by the county. That's what the County's telling us, yes. [12:54] **Councilmember Katie Porter:** And you take that $354,000, take one percent of that, then you apply the tax capacity rate to that one percent? [12:58] **Chris Gormley (Finance Director):** Correct. [13:00] **Councilmember Katie Porter:** Okay. Um, I don't have any other questions right now. Thank you so much for putting this together and presenting. [13:04] **Mayor Joshua Hoyt:** Steve? [13:05] **Councilmember Steve Wilson:** Yeah, a couple—really more of a couple comments. Chris, I really cannot thank you enough for all of the incredible work. I know that doing the budget starts probably in about March/April? [13:17] **Chris Gormley (Finance Director):** Right after the auditors get done, I start doing a lot of the behind-the-scenes work. [13:21] **Councilmember Steve Wilson:** Because you know, when you're in finance, one of the things you look forward to after the audit is to start getting going in that budget. For really, you know—Chris, the whole team—from my end as a decision maker, you look at the preliminary, and of course, this can't go up from this point; it can always go down. You kind of stare at that number and you're like, "Wow, 12.23 percent, that's a pretty big number." To put that in perspective, one of the reasons there are exciting things happening in the city is thanks to our team here. If you're looking to get a world-class team, you want to make sure you're able to keep and retain them. That’s an investment you have to make. Residents have seen trees coming down because of the Emerald Ash Borer—that’s a big-ticket item that probably should have started more aggressively before this. And that $150,000 for the EDA—every resident tells us we need more commercial growth. Building those relationships requires investment. That $150,000 is going to have a gargantuan multiplier. I never like to say I’m "excited" about a 12 percent increase, but I know this is a huge investment into the growth of Farmington. For that reason, I’m very comfortable with it. [15:58] **Mayor Joshua Hoyt:** Thank you. Nick? [16:00] **Councilmember Nick Lien:** Brian—in the same vein as Steve, seeing that 12 percent, the reason it's more palatable is this feels like the first year where we’ve understood the cost that we need to do and now we’re going to attack them. We’re turning a corner to fix things. It’s not enjoyable, but it’s a necessity. I’m happy we’re doing it based on sound data and good judgment. You guys aren't just throwing money at a problem; you’ve told us the pace you can go at. I think this is a really sound, data-driven decision. Thank you. [16:42] **Mayor Joshua Hoyt:** Thank you. Holly? [16:44] **Councilmember Holly Bernatz:** I feel like Steve and Nick have really covered a lot of the bases. The only thing I would add is I appreciate that we’re all looking at this from a similar perspective. We’re not randomly putting numbers out that we think are "palatable" or more than what's needed; rather, we’ve had conversations about what has to happen to set us on the trajectory to be successful. I can’t say enough about the work from every department to give us information in a digestible way so we don’t fall behind. I think this is a necessary step. [17:38] **Mayor Joshua Hoyt:** Thank you. Yeah, not to add a whole lot because we’ve covered this in extensive detail the last few months. We’ve spent the last six to nine months doing the appropriate planning: the pavement management study, understanding there’s work to be done. Emerald Ash Borer—this is not a one-year event; this is a five-year plan. There are 3,000-plus boulevard trees that need to come down, stumps to be ground, plantings to take place. There’s a cost to do business. Getting our staff at the 75th percentile aligned with our focus on targeting and retaining high-level talent is vital because of the unique challenges this community presents. You can't "spend percentages," but I look at it as $15 a month for the average homeowner. In the overall scheme, it’s a small investment into the large amount of work taking place in 2024. This is merely a formality of the process at this point. I would look for a motion to adopt resolution R62-23, adopting the preliminary budget and setting the 2024 preliminary tax levy and debt service levy, and to set the public input meeting for Monday, December 4th, 2023 at 7 pm. [19:43] **Councilmember Steve Wilson:** Motion to approve. **Councilmember Holly Bernatz:** Second. [19:46] **Mayor Joshua Hoyt:** Motion by Steve, second by Holly. Call the roll, please. [19:48] **City Clerk Shirley Buecksler:** Councilmember Lean? **Councilmember Nick Lien:** Yes. **City Clerk Shirley Buecksler:** Councilmember Porter? **Councilmember Katie Porter:** Yes. **City Clerk Shirley Buecksler:** Councilmember Wilson? **Councilmember Steve Wilson:** Yes. **City Clerk Shirley Buecksler:** Mayor Hoyt? **Mayor Joshua Hoyt:** Yes. **City Clerk Shirley Buecksler:** Councilmember Bernatz? **Councilmember Holly Bernatz:** Yes. [19:54] **Mayor Joshua Hoyt:** Thank you, sir. Moving on, item 12.2 is the Professional Services agreement with Kimley-Horn for the 2024 street and utility improvements and the 2024 mill and overlay project feasibility study and 30 percent design. John? [20:10] **John Powell (Public Works Director / City Engineer):** Thank you, Mayor and City Council members. During our past item, you mentioned the pavement rating system; this action takes that information and puts it into action in the field. What we have here is the feasibility report and 30 percent design for two projects. One is the 2024 street and utility improvements (complete reconstruction). We’re doing 6th Street from Ash Street to south of Walnut, and Maple Street from 4th to 6th. Two of those roads are on the boundary of Farmington Elementary School. I was out meeting with the principal today and Dan Miller from the district looking at challenges so we can address those as part of the project. The second is our mill and overlay project. We have a variety of roadways: 182nd, Euclid Street, Embry Avenue, Embers Avenue, 208th, Eaton, 213th, 9th, and Spruce Street. These are areas where complete reconstruction isn't warranted, but an edge mill and new layer of bituminous is needed to restore the crown of the roadway so water sheds to the curb rather than sitting on the pavement. You approved the consultant pool earlier this year, and Kimley-Horn is one of the approved firms. This agreement includes neighborhood meetings and an interactive website for property concerns. The schedule would be completing feasibility in the next couple of months, final design in December, opening bids in February, and starting construction when weather permits. Working around the elementary school, we’ll focus on summer months, though we may start some work in mid-May. The budget in the CIP includes three million dollars for reconstruction and one million for mill and overlay annually. We are taking this to 30 percent design first so we don’t have to renegotiate with consultants if the scope changes. The recommended action is to approve the agreement with Kimley-Horn for the feasibility study and 30 percent design. I’d be happy to respond to questions. [24:46] **Mayor Joshua Hoyt:** Thank you, sir. Nick? [24:47] **Councilmember Nick Lien:** I have absolutely no questions. I think there’s a lot of people in that downtown area that will be very happy to see their roads getting fixed. [24:59] **Mayor Joshua Hoyt:** Holly? [25:00] **Councilmember Holly Bernatz:** Um, no, I don’t have questions. I just appreciate all of the thought and effort put into taking these projects on in a manner that makes sense and isn't just randomly pulling things from every direction. [25:22] **Mayor Joshua Hoyt:** Katie? [25:23] **Councilmember Katie Porter:** Yeah, like Councilmember Bernatz mentioned, your approach to this is spot on—what we’ve needed for a long time and very sequential. Looking forward to seeing some of these repairs done. Thanks, John. [25:38] **John Powell (Public Works Director / City Engineer):** Thank you. [25:40] **Mayor Joshua Hoyt:** No additional comments. I couldn't be more proud of the team to get to this point. I started in 2019 and it was Westview Acres, then the roundabout, then Aiken Road, Spruce Street... we are working our way towards the bigger projects. When we put on the board earlier this year to "meet industry standards," that was saying we currently did not. The addition of new leadership and a commitment to data-driven decisions is a big deal for this community. This is the first of four, five, or six years of projects to this scale. I would look for a motion to approve the Professional Services agreement with Kimley-Horn for the 2024 street and utility improvements and the 2024 mill and overlay project feasibility study and 30 percent design. [27:32] **Councilmember Katie Porter:** Motion to approve. **Councilmember Nick Lien:** Second. [27:35] **Mayor Joshua Hoyt:** Motion by Katie, second by Nick. Call the roll, please. [27:37] **City Clerk Shirley Buecksler:** Councilmember Porter? **Councilmember Katie Porter:** Yes. **City Clerk Shirley Buecksler:** Councilmember Wilson? **Councilmember Steve Wilson:** Yes. **City Clerk Shirley Buecksler:** Mayor Hoyt? **Mayor Joshua Hoyt:** Yes. **City Clerk Shirley Buecksler:** Councilmember Bernatz? **Councilmember Holly Bernatz:** Yes. **City Clerk Shirley Buecksler:** Councilmember Lean? **Councilmember Nick Lien:** Yes. [27:42] **Mayor Joshua Hoyt:** Thank you, sir. All right, our next item 12.3 is a closed session for Wells Fargo Bank vs. True Gravity Ventures LLC. I'm going to make a motion to close the meeting pursuant to Minnesota Statute section 13D.05, subdivision 3B, for a confidential attorney-client privileged discussion regarding liability and strategy in the matter of Wells Fargo Bank versus True Gravity Ventures LLC, Astrogen Star Partnership LLP, Robert M. Wachholtz, and the City of Farmington, Court File Number 19-HA-CV-23-308 in Minnesota District Court. I made the motion; I’d look for a second. [28:28] **Councilmember Steve Wilson:** Second. [28:29] **Mayor Joshua Hoyt:** Motion by Hoyt, second by Wilson. Call the roll, please. [28:32] **City Clerk Shirley Buecksler:** Mayor Hoyt? **Mayor Joshua Hoyt:** Yes. **City Clerk Shirley Buecksler:** Councilmember Wilson? **Councilmember Steve Wilson:** Yes. **City Clerk Shirley Buecksler:** Councilmember Porter? **Councilmember Katie Porter:** Yes. **City Clerk Shirley Buecksler:** Councilmember Lean? **Councilmember Nick Lien:** Yes. **City Clerk Shirley Buecksler:** Councilmember Bernatz? **Councilmember Holly Bernatz:** Yes. [28:43] **[Music]** [29:14] **Mayor Joshua Hoyt:** Thank you. **[Music]**