for October 18th and uh Jenny if you take the role councilmember Thorson here council member Peterson your council member Wong here council member Cole is absent and mayor for a long your motion to adopt the agenda Peterson second by the councilmember long any discussion if not all those in favor signify by saying aye aye oppose agenda's adopted we have uh three topics and I'll turn it over to city manager frandel thank you mayor yeah three topics tonight the first one up is uh update for the Public Employee insurance program our insurance rates were looking to go up a little over 50 percent um uh we have a RFP out I'm trying to get some information of who else can step up and offer us some insurance and what kind of rates we can they can offer I'm going to turn that over to Dan Dan looked into that um Mr Winnick our finances and I believe we we took this a couple years ago changed carriers and we thought this was going to be good for a while but evidently it is not so correct go ahead uh thank you mayor council members uh yes uh the city moved over to the P plan the public employees insurance program a few years back um in the past 12 years um the peop program has averaged about a 3.8 percent annual increase in insurances and that was part of how the program was established was to build a pool offering of of Minnesota cities offering insurance and trying to keep it pretty much a flat rate obviously we're we're hearing word that they're having a little bit of financial difficulties especially with insurance premiums um you know around you know the nation going skyrocketing to keep that 3.8 so what they have done this past year and we got notification on September 30th that some of the better performing entities that were in the pool have exited the pool and in addition they are changing their underwriting guidelines and so in essence what they have done for us the city is that they're gone back a few years looking at the claims and the claims are higher than our insurance premiums that we were paying and we're basically paying a catch-up strictly for us um they did it out more or more claims were being paid out more yes our yeah they gave us our samples yes they gave our gave we asked for it and they gave us our specific data and our our uh what was paid out from our pool here in the the city of North St Paul was higher than what we had contributed to the pool and we're not the only ones a number of cities were hit pretty hard depending on how you want to look at it fortunately um we are right now in year one of a two-year agreement with peep the only way that we can get out of uh the second year is if we had a 50 percent increase in our premiums and that's what we've got is a 50 increase so we have the option we have we would have to exercise that and give them a 30-day notice so by December 1st we would have to give them notification if we were going to get out of the peep insurance so as soon as we received the letter um Jenny and myself we contacted uh Gallagher insurance agency and they put out an RFP we did a public notification for the RFP the RFP is out on the streets right now it's the close I think October 26th um and we should end up seeing if there was any interest in picking up uh the city's insurance if there is no interest um our only option right now would be with people we have heard that we have gotten one response to date um and even that was somewhere in the ballpark of about a 40 percent increase from where we are today um we're hearing that you know there was a chance that maybe we could be you know somewhere at about a 25 to 30 percent premium increase in holding what the the city's current plan offers but um we'll hear from uh you know we'll wait till the 26th to find out the um if there's any more respondents um in any in any and all of that information will be brought back to the city council um and having a discussion with the city council on what to do the unfortunate part for us is getting that notification on September 30th if you are you're all aware of that that's the same date that we you know by Statute had to start a buyer maximum Levy which we approved earlier in September so we can't increase our our Levy um you know to cover any of the costs the costs um impact to us um so in the budget again in the past 12 years they've averaged about a 3.8 percent annual increase in the budget I had budgeted eight percent and they're going up 50 that 50 percent the Delta 42 percent would mean 197 000 increase to the city the general fund would pick up approximately 139 000 the Enterprise funds about 152 HRA about 2600 Eda about 4 400 dollars um what that means for the employees in this in the city on an annual basis for a single coverage the employees um pay 10 percent would go up uh 291 percent or 291 dollars on an annual basis the city would go up um 600 in family would hit the employees fifteen hundred dollars increase on an annual basis in the city would increase about 6 200 on an annual basis so what are we doing I think Brian kind of talked a little bit about that is that you know we we did an RFP through Gallagher we're also um the city had an insurance committee for a number of years it's been discontinued um that has been that is being pulled back together I think it's first meeting with employees um selected I think there's Department Representatives that will be a part of the committee is going to convene I do believe next Thursday for the the 27th for the for the first time um unfortunately there's not going to be a lot that this in turn or this insurance committee can make changes at this point in time the RFP was basically given instructions to keep um the coverages that we currently have in other words the deductibles and so forth that the insurance plan has there may be some suggestion suggestions in the future that the insurance committee may may make any any changes that we do to the insurance plan in my time here I've heard from employees that um you know the insurance you know they would like to see a plan that has lower deductibles and so forth anytime you do any of that it all equates to much higher premiums much higher premiums for the employee and it's also a much higher premiums for the city and obviously if you can see what a a cost impact here of 50 percent increase does to the city at the tune of 198 thousand dollars you know any change in the Premium plan and we did reach out to to Peep and there's two other plans that they offer that are non-hsa compatible and their premiums are significantly higher than where we're at today I mean over double to what the premiums are so the committee is really going to I think have to look at comparabilities from other cities what are the offerings the reason for that is because one of the big things that's happening all around is you know attracting and retaining employees and I think probably I mean you've heard the police chief talk about it a number of times that um just in the police force itself it's hard to attract um you know candidates to come and work in a police force and there's a number of organizations that are actually offering bonuses but part of your benefit package is a very important and critical component that does attract an individual to come work for a various agencies so I think we need to compare ourselves to other cities that are around in the metro area to what are they offering for those packages and I think that's a part of a of what an outcome of this insurance committee should be looking at I will sit on the insurance committee only in an advisory role um in advisory from the standpoint of trying to give a little bit of direction of what they should be looking for and some information that they should try to attain and if they need to have financial information of what impacts that would be both for an employee in the city I would provide that information but I can't have a voting right or input right onto it because I I'm the one who has to end up reporting back to the city council and making a recommendation of where we should do from a budgetary standpoint so I'll play an advisory role in case they need some information from a historical perspective and then if they need something projecting something out into the future for them the health it's it's part of the Union contract wasn't it yes yes it is under guidelines on the uh yeah the the uh and and Jenny and and uh and or uh city manager friend I'll uh jump in I think the the Union contract really doesn't specify what the coverage is um of the insurance are it's more of percentages um where um for a single coverage the employee pays 10 percent um the city picks up 90 of the cost per family it's 20 20 80. yeah a percentage it's a percentage whatever that rate's going to be right um but in future negotiations um depending on how the premiums go um it definitely could impact the package that they're going to be asking for in other words in their cost of living um you know increases in the future so it's a it's a tough Balancing Act um you know that that's going to be they have to that's going to have to be looked at before we end up making any final decision now because of the late notification and what were late notification from people of letting us know of this increase one component to it is is we can't change our our Levy and so right now where we're we're sitting I I truly was in hope that we would have more discussions on the general fund in hopes to try to maybe drop that Levy um somewhat we're sitting at a combined Levy increase of 8.48 percent I really don't think that's going to be possible at this point in time with this increase that's out there even if it's at a 30 or 40 percent the Saving Grace for it all is is that we did have in approximately 198 thousand dollars that Our intention was that it would be an increase to our Street Maintenance unfortunately that may end up being what we use that that those funds for here in this upcoming 2023 budget is to cover insurances um so again fingers crossed hopefully we can get some good rfps in and we can get a proposal that is significantly less than the 50 increase that that peep is is giving to us one of the options that you need to be aware of is that if we elect to go away from peep we cannot rejoin people for two years so then we will be on the Open Market at least for the next two years sure um how why was it so late I mean it was not on our fault why didn't they project this or I mean just seems like it's kind of like let out of the barn really late on this or is this typical I mean I don't remember having this like this discussion well it to me from my perspective it is late in the game obviously because by Statute cities need to certify their Levy by September 30th so that's when you get the notification why we haven't heard that in the past because their Philosophy from Peep has been to keep the rates relatively low somehow they've changed their methodology without communicating it to everyone and I would assume that they were going through their their numbers and and calculating what they would be for everybody before they they disseminated that information my understanding is also that they have a outside company that actually does their financials for Peep and they are currently out for an RFP to get a new firm um so that's kind of another little indication that they're more than likely not satisfied with their current firm that they're working with and it may be for some reason they may believe that that has led them into where they're at from a financial standpoint that made them make this change and not treating everybody because their past philosophy was treating everybody as a pool and whatever increase went everybody got the same increase now they're breaking it apart more more consistent to what you know the market itself does so is everybody getting the 50 increase or is just North Saint Paul getting the 50 percent increase North St Paul isn't the only one that's getting a 50 increase not as a not as a whole no the same no no it's because they they're changing their their methodology of how they're they're doing it so there were some others that that did we got information there were some others that did receive a 50 increase there were some that received 20 30 percent increases um so yeah it's it's that legal well you know I I mean I I I I would imagine that they can well it's it's definitely a change in their philosophy and from how the how it was established um in the past and you know even the letter that they had sent you know talks about that you know kind of in a general way but that they've had to change their their methodology of their underwriting guidelines of all they've done in the past um and that they're no longer able to uh you know to keep it the same raise for everybody um and I think in a large part that's why the city made an excellent choice a number of years ago to to going to peep because it was keeping rates um you know you you're really truly in a whole big pool um now the way that David at least described it to us is that they're now going to look at entities separately um no different than you would in uh you know if you were to go out to the market so is it based every year they they re uh sign the number are you guaranteed for two years or one year no the rate no you're not you're not so every year they could they could change that rate every year right they they have not shared their full underwriting guidelines and to will that what is their complete methodology that they're they're doing but obviously by the information that they've shared they've at least done they at least have done uh looked did did a two-year look back of payouts versus premiums and I you know based on the information they provided I agree with them um we have drawn out you know more payments than we have contributed to the pool but that wasn't the philosophy that the the peep was was built upon so this was a total shock and surprise you know to us that's where you know based upon past historical again 3.8 percent I put in eight percent I I'm playing a very conservative making sure we've got enough money into it and and and being shocked um when this came so Jenny had to pick me up after she shared the information with me it was like wow um and to me the only saving grace that we had was that we did have money that we had put in to the budget for Street Maintenance that we could allocate to this and then I have some other thoughts because I don't want to see our Street Maintenance go without those those funding and that'll actually I'll discuss it when we come up to our next item when we look at the third quarter general fund yeah well I mean it's pretty obvious I mean we need to do an RFP we're doing that that's what you do when you see these drastic increases I'm not familiar with peeps in their history but it seems like it's you know they they form this pool and they sold a bill of goods to a bunch of cities and they made promises that they can't keep and some of them are out of their control and they're making adjustments just like any other person or business would need to so it's pretty obvious what we need to do and hopefully we can find an insurance carrier that is less and more consistent but uh you know this kind of has similarities I don't know how familiar people are with the Fire Relief Association and you know if we're going to have discussion about that but there's been talks recently with that group about switching to some State Relief um where that manages the funds um and they're and they're you know in my opinion it's not an attractive option because they they share with you just the the grandiose Fair Rosie things to get you in and then once you're in you can't get out well you can it takes an act of the state legislature so good luck with that whereas now you know when I was on the fire department we were with Wells Fargo advisors and we were with them for many many years and they they're you know big corporate structure and turnover of of uh Representatives who we're dealing with we made the decision to switch to another private entity and been happy with them um but now there seems to be this push to put everyone into this state-run thing that you know I don't know if this is any similar to it has similarities to that but you know he should always be cautious of what the salesman's pitching in what the realities are so you know we're having to deal with this and you know the fact that we've locked our budget in and we can't go up you know we there's there's all sorts of ways you can slice the pie I've said that before and a lot of your projections I think you know when we're looking at these Enterprise funds and internal funds are you're you're looking way down the road 10 years and that's great but you know this is an example of what the problems that come up when we do it when we when we look at that and we kind of have to look at just the next year next two years which we're in our control and we can ratchet back contributions to certain funds out of other you know there's a there's all sorts of options and things we can do so I don't think this is a doomsday scenario and we're certainly not going to be laying employees off so we'll just continue with the RFP and hope for some good news um council member Thorson I absolutely agree this isn't a doomsday um absolutely not we've got we've got options that all present an option um when we do the this next item here that we look at the third quarter because we are performing halfway decent in the general fund and if you remember we ended last year with a 44 um you know fund balance per our policy so you know one way or the other I think we're we're going to be on the same path that we were with the budget just would like to be able to to see these rates come down somewhat and I absolutely agree and that's why we jumped on it right away as we went out for the rfpm and you know we we I believe we we did our due diligence and making sure that we're doing or taking care of the city's best interests and the taxpayers interests and I'm trying to find a better lower cost the reality to it is is that um whatever this program had offered in the past appears to be sunsetting and what it means to us moving forward is that we are going to see um potential for volatility in our health insurance rates there could be years that it goes up and there could be years that go down and I think we're all aware that in government that's those those are the things that we don't like to see we like to see things kind of more of a constant so we can kind of manage them we'd like to be able to predict and that's really that's really it because I absolutely agree with councilmember Thorson you know every we can lay out the best plan that we want and something like this can come up and change our course Very quickly but it doesn't mean that we don't attempt to try to make that plan out there and kind of looking at it and and trying to get back on course and I think that we've got options to get it back on course so I don't think it's a doomsday we're not definitely not laying off staff um it sounds like getting out of the plan is not a bad thing either it'd take us two years to get back in but who knows what those rates are going to be like in two years absolutely you're doing a comparison with other carriers you're just going to get the cheapest carriers you know cheapest as possible yeah and and when we come back to the city council with the information we get from the RFP we'll also have additional information from from the peep program to to affirm hopefully affirm from them that their methodology will be more of a volatile that'll it'll you know every year could be a bigger Inc you know could be increases or decreases in other words they're going to be looking at it from a market perspective you know again going back looking at your past expenditures what your contributions are and there's going to be I call it catch-ups which then end up being significant increases in a in a year or decreases if if that be if that's the case the payoffs was that due to injuries or was that due to layoffs or in the past best last past year that I'm going we had a lot of I I don't think we ever got specific information to the you know where the the payouts actually went I mean Jenny and I made some speculations of where we thought they might have been but I think a lot of that's um a lot of the specific information I think is covered underneath the HIPAA laws that we wouldn't be able to get that information um so they they give it to to us more of on a monthly total cost basis of what was paid out is the league of Minnesota cities do they have a policy that right out the cities they don't have a pool of not on not to my knowledge on the insurance no just wondering well I no I that's not good good question because they do a fantastic job and and we use their resources quite significantly in many other areas so yeah everybody else got any questions are there any costs associated with joining or leaving any of these policies at the time that we're trying to do it for the second year um there is no cost associated with getting out of the peep insurance program at this point in time our only option to get out is is because we're in the first year of a two-year contract is if there was a 50 increase that was per their clause okay what else thank you Dan turn it back over to city manager frandel hey come here next up is the third quarter uh statement of revenues expenditures and changes in fund balances for the general fund and I will turn that back over to my instructor welcome Dan well thank you thank you very much mayor council members that's that time of year it's all about the finance Finance yes so this is the uh not this is the third quarter um statement of revenues expenditures and changes in fund balance of the general fund um you will notice in a second that it you know shows the budget versus the actual for you know through September it'll give an overall projection for the year based on Trends and assumptions and then the change in the fund balance for the current period and annual projection um so kind of show what this looks like here so the First Column is the 2022 adopted budget it's the actuals as of September 30th it's the variances at that point in time I do a projected of what I believe the outstanding is going to be um or in other words what revenues we're going to be collecting still for the remainder of the year and or expenses that we're going to have for the remainder of the year I give a year-end projection and then show where that's going to be so right now I have us at approximately about 160 thousand dollars increase in our fund balance um the last time that had given an update that projection was at about 330 000 and so we look at that 159 000 a significant part of that which gets us pretty close to 330 is um due to market value adjustments which through our first nine months in the general fund is a decrease of approximately a hundred and ten thousand dollars so if we were to add that 110 000 you'd be up to 279 000. so what is market value adjustment per gasby we need to show our investments at their fair market value so in times where interest rates are on the climb your fair market value goes down when interest rates are going down the fair market value goes up why because you buy your Investments at a certain point in time you're locked in at the at the interest rate and so as they go up and down your Market values go up and down too it is an unrealized loss what is meant by that is that you haven't realized it the only way that you would realize that if you were to sell that investment before is maturity but we hold all of our investments through maturity so it's more of a financial reporting than it is kind of a reality but that's it's included and it's actually included in the other revenues and interest rates are still you know fluctuating and so we probably will see well we will see some more unrealized losses showing up on our you know uh through the year end and through on our financial statements but it will not be be realized on in you know in there if we look at the revenue section there um you'll see um probably the biggest increase definitely was permits um you know it was up over what we had budgeted um by 580 000 in our 2023 budget I have increased the budget for permits up to about I think 500 and some thousand dollars to be much closer than what we've been seeing the past number of years but yet still not as high as this because obviously this was really generated because of the hail storm that came through the city so we have the 581 thousand dollars is a significant increase um we're seeing a um some extra money coming in through intergovernmental um you know more in the police and fire Aid sections um and then the other Revenue was with a bigger decrease is really due to again that that market value adjustment that that that's showing up um in here and then when I project it out I'm anticipating that we're going to you know from what's in the budget be down about 220 000 again I look at things from a very conservative standpoint I mean our condition could be much better than this by the by the year end and we'll keep our eyes on that um and looking at everything both revenues and expenditures if we look at on from the expenditure side again you're going to see the building inspections being way over over budget again it that's an equation of of the permitting we contract for those services and depending on what type of Permitting service that we receive like it's an electrical inspection they get 80 percent we get 20 percent if it's some of the other permitting they get ninety percent we get 10 percent um one of the things to be aware of and if you look at it and you say oh well you're going to be it you you're going to have revenues that are increasing 581 but you got expenditures 579 thousand dollars that's pretty close you just got done telling me that there's 10 and 20 percent what were the difference go well the difference goes because how we recognize permitting revenues and expenditures is at the time that they are incurred or received so the revenue shows up immediately the expenditures may have a timing difference of a month two months maybe three months so in other words at the end of last year we could have gotten revenues that were recognized but the expenditures didn't show up until the beginning of the next year so there can be a fluctuation between how they're looking at it so it doesn't necessarily prove out to be just the ability just to go with 10 and 20 percent component to it the other significant overage on the on the budget side is the police department um however in the police department if you recall the city council had approved during the year this year a police officer so there's an increase of expenditures for the police officer that was not in the budget and will not be from a budgetary standpoint in the budget until 2023. in addition when the budgets were set the union contracts were not fully complete we were pretty much in line with what we budgeted in 2022 to how the union union negotiations churned out with probably the biggest exception was if we recall and I and I think it was council member Wong that you had asked what the cost impact of that change was and that was for the sergeants changes that happened in their Union contract and I and I did a calculation at that point in time and I think it was and responded back I think it was approximately forty thousand dollars so you know there was so those two and then in addition there's approximately thirty thousand dollars worth of expenditures here that'll be refunded through a grant for the phlebotomy grant that that isn't being reflected here in the budgetary standpoint so the intention of what to do with some with all of these overages and shortages in the phlebotomy Grant is that later part of this year I will bring um a budget adjustment to amend the budget to get it more in line to where we're really at and what our expenditures and revenues truly were for your approval but again we are looking positive for the year so that may be a good source um and and may bring the recommendation here towards the end of the year or early part of next year of transferring those funds for for Street Maintenance if the peep dollar amount continues high as long as we're over that 40 percent fund balance regulation part of our policy and that will be brought for discussion um I'm proud to say the finance department has is about 77 000 to the positive um so uh I'll be looking for my bonus no I'm just kidding but uh uh you know part of part of that is but uh uh you know part part of that is is um with the reorganization that we've done and have not you know part of that reorganization had a part-time accountant really haven't used the part-time accountant through this year we've been you know going through it ourselves and we've been pretty good there obviously there's things that we can enhance and that's where the request for the 2023 budget of adding an accountant comes in because we can do a much better job than than where we're at right now but um we're managing getting through things and I think we're doing an exceptional job but want to see it get even better and being more connected to doing some more especially for the budget in the year next year I'd like to do more of community outreach on the budget so we can get some more input from the residents and to keep you better informed so I think that's really where the accountant will come in and help greatly and then and then to to make sure that we're keeping our separation of Duties but Finance is doing very well the Community Development you'll see is is projected at being about sixty six thousand dollars over budget a large part of that and almost all of it is is due to what I have in there for a community development director again that was approved middle of the year without any increase in the budget so they're they're will be somebody hopefully coming in shortly into that position and so I've included you know these salaries for that individual to be in part of the budget so I will take I talked about the past during a budget committee for and all the public you know getting some people involved in yes talked about that in the past yeah absolutely turnover and staff and all that we just never got it off the ground right no and and then I think it's a good look you know it helps me out greatly too I love to hear what citizens um their perspectives how they look at things um you know um there's ways that we can show things a little bit differently um you know there's there's definitely some areas where revenues are being recorded in one spot but expenditures don't our expenditures don't get reported in that same area um and and so those are some discussions on how we want to do things in in the future that I think can can enhance our presentation of our financials and make it clearer for everybody to understand and know exactly where we're at and we're going to see that coming up here when we when we look at budgets um so I think that's an important component that we need to get perspective from from the outside I think another important thing too like you kind of touched on with the unrealized loss from the Investments is another thing the city has really not done a very good job of tracking is um you know like Public Works staff time doing something like demoing the HRA house and there's no bill to the city and that that that's a cost I mean and instead of them going out and doing other things they're doing that and then that cost isn't being included in the overall cost of the home you know so that's just one specific example of how when you know City staff time is you know the city managers spending more time in Community Development is that being so billed or allocated to that uh or any Enterprise fund you know so those sorts of things I don't think because it's just the nature of I mean at one point staff did have to keep you know they would allocate their time to a billing code and then that went away and I don't know if I think that's come back now in a sense somewhat but I don't it just seems like there's never a real true understanding of what we're doing and where the costs are going so that would be another benefit to maybe having this budget committee and looking at things like that recommendations for changes moving forward but we've we've made changes to the way we present the budgets we've had several different Finance directors over the years and different city managers who have a different perspective on things when I do things differently so I think we're all just looking for consistency and especially when you know we start to do things one way and it stays that way for future councils so they have a better understanding of how things are doing as well and not just kind of being lost in the dark and having no comparables to look at to make decisions so I absolutely agree with you councilmaper Thorson absolutely yeah Dan did you have another scenario about this Street Maintenance I hate to see that not be done or was there another thing you were going to talk about yeah yeah because uh you know we're you know again we're sitting at about 159 000 um so I believe we will have I'm gonna say so per our plan for Street Maintenance it needs to be funded approximately 100 well not approximately 150 000 per year I think we're going to have 150 000 that will be able to transfer from the general fund over to the Street Maintenance um now I'd feel a little bit more comfortable if we can get those insurance premiums down um because then we definitely can cover it and still maintain at least our 40 percent um fund balance ratio per policy so that's really kind of where I see that we're going to be able to do that and kind of I'm pretty pretty confident that we will be able to do that and again um thank you that unrealized loss eventually will turn around um because it's it's not realized so it'll change you know I would anticipate it to change if not in the latter part of 2023 we'll end up seeing it in 2024 rates won't go up forever but we could see it for a significant amount of time still um just by how the economy and everything is looking at this point in time but um you know that's more to Common and you know the the feds are gonna continue to raise interest rates to try to get inflation under control um I think they're pretty committed to that um they haven't seen the numbers as far as the labor market um and and or inflation and that's really their two primary goals that the feds are looking at so I think they're pretty much committed coming up here in November to kind of looking at another three-quarter percent increase and then there's another opportunity in December for them to to increase rates on less inflation starts to drop more to their liking anybody else you finish staying on that um if there's no other questions yes city manager frandel topic also has Dan up to bat uh 2023 internal service funds and other budgets right back at you Dan welcome Dan oh well thank you uh thank you thank you mayor council members and thank you um city manager frandel um the budgets that we're going to go over and take a look at today um so today we've really done an extensive look at general fund Eda HRA we are going to look at our internal service funds in which we have five internal service funds Information Technology Insurance equipment City mechanic and Building Maintenance and then we have five other Permanent Fund budgets that we prepare community center community event Fire Relief Park and Street Maintenance then after we get done with this the next Workshop we will be discussing Enterprise funds and and after that so the first meeting first Workshop in November we'll go over Enterprise funds and then in the second meeting in November we will be looking at the potential of um our city fees and rates on whether there's changes or increases or decreases that that need to be made into to those and then the first meeting in December is where we approve um the uh we have our truth and Taxation hearing and we approve the the 2023 budget as a whole and so those are the budgets that we actually approve so in looking at our internal service funds again we have five and kind of gave a little bit of a description and kind of where we're at there's the information technology it is being presented for 2023 as a balanced budget of 444 000 268 what that means is that the revenue and expenditures match there's nothing that's coming out of fund balance um so all of the 444 000 is being charged to other um budgets other cost centers other departments within the city of North St Paul the significant changes as were that was brought up early in our budget discussion as a driving force is the Metro inest our inet charges increase of approximately seventy two thousand dollars the insurance and the insurance does not um include do we ever talk about that Metro in it why it was going up so much um yeah um and it's kind of interesting um so um city manager uh frandel and myself had met with Metro inet um they they listed three different scenarios in which they were looking at you know labeled a b and c c being the highest worst case worst case scenario at seventy two thousand dollars an increase would be the impact for the city of North St Paul um so they have undergone a significant change in their organization and their operation so I think last year they had hired a I guess you call it a CIO and they have all always been they're housed and they've always been kind of like I'm going to say more of a quasi organization of Roseville City of Roseville and um Roseville provides their accounting for Metro inet um so part of what they were looking at underneath their new leadership is that they were basically going to become their completely own entity um so part of those increases one with the new CIO was looking at and did um from from what she had told us they they did a staff analysis on the job functions at every one of their staff was performing they found that there were a number you know from a historical standpoint in any small organization this always develops the same way then all of a sudden you find where staff has inherited many more job functions than necessarily their job description and so she was looking at and Brian city manager of Randall if you want to jump in I think she was looking at an addition of five to six ftes to cover some of the various functions and then including that was going to be in addition to that you know some sort of administrative accounting staff for the organization in addition to that they have a very very low fund balance for any Capital replacement so it was to build up their fund balance um and so I think that was kind of I think that was pretty much the highlights of the conversation the part that I have never seen is that in that meeting they were going to be having a follow-up and they've never had that and there was going to be the final voting on what option um you know the cities that are a part of this Metroid net um and I have never seen that anything on to that so you're saying that this 72 000 may not happen it may not happen I mean they may choose because this is option C the highest so there may end up going option A or mod or option b and when do we we don't know when that's going to be that's why I was thinking about that last week and and I haven't had a chance to touch um with the city manager Randall I have never heard because he was going to be the contact person for them to set up um and they were supposed to include me on that so when they had their meeting that we'd be able to attend but I have never heard anything on to it so I don't even know so I'll reach out to follow up to find out where they're where they're at so if we do here that it's not going to be as high as that I can make adjustments to reduce what's being charged out to other departments which then can ease some of the pain in the general fund and the Enterprise fund stops at some of the cost of the insurance so that's definitely a possibility but we do need to find that um now that we're talking about this just a couple of quick questions for refresh my memory and maybe those who are watching and don't know do we know how many municipalities Metro inet Services besides us obviously Roseville but do we have any idea of how many other municipalities they provide this service to um they did provide us the whole list when they did I didn't bring it with me I'm going to take a guess that it's somewhere in the ballpark of and city manager frandel please jump in because you saw that spreadsheet too I'm going to guesstimate that it was probably about 20. so roughly 20 maybe more or less and what what services are they providing to us that we pay for and utilize um phones and when you say phones you're meaning we buy the phones they you know someone calls that's they're providing that phone all on their Network Comcast or CenturyLink correct okay and I'm assuming internet too that's correct servers so the security all of our all of our computers and everything we don't have a server on hand here it's all routed through them oh we do have solid base we do have we know we do have we do have some servers here that's that's one of the pieces in the finance that um and actually it'll be next Thursday um we'll be um I'm going to segue for a second um and we'll be getting out some publication um I can finally confirm it with uh Carey to get it out onto our newsletter newsletter and I said we will not be able to collect Utility payments um next Thursday as we go live and we are actually moving off of a server into the cloud okay yeah so they provide maybe back some live and some backup but we do still have I'm trying not trying to get into technique I'm just trying to get what do they provide so and then our like City emails and stuff and then I'm sure they provide some sort of you know protection you know security you know cyber security type of stuff so that that kind of falls under that internet is there anything else that they're they're doing that we security cameras well our security cameras any kind of maintenance for any I.T issues that anybody has and then so they're like and they you know they're like the troubleshooting if we have a problem with the wrong one we call them okay correct software software upgrades so so they kind of they're providing a whole information in it Suite how long have they've been providing these services to the city North St Paul are you and again a rough estimate a long time so is that 10 years 20 years I mean 20 years ago the internet wasn't even around was it I mean were that dated no I mean maybe a little longer than that I mean but I mean have we always outsourced our services since the beginning of time with Metro inet I mean I'm just trying to all parts I I personally do on the console okay so 20 plus we'll just say 20 plus sure sure in those 20 years have we ever done an RFP for these services the answer to my knowledge is no okay no and the whole point I'm getting I know exactly where you're getting and I think it's fantastic to illustrate for the public who people may not know we're talking about budget issues we just got done talking about insurance costs we've done rfps in the past it's common when things go up why why are we not talking about doing RFP for this stuff so if you recall when we had one of our workshops and I had asked the questions of the city council for ideas of trying to reduce some of the costs one of the items that I actually put it up there was that we need to look at our technology and so we are starting that process of looking and first of all it is to Define exactly what services are being provided um you know part of that is we do have an individual that's here like three days a week to help us with any troubleshooting setting up PCS you know kind of there you get a high demand especially for the public safety component to it so we really need to get a clearer understanding of what services that they're truly providing but yeah this when this seventy two thousand dollar hit came to us I mean we just didn't turn around and do nothing but to develop an RFP we need to know exactly what services are being provided to be able to articulate that and get it out onto the streets um and so I'm I'm in hopes that there is some other way of being able to do that I think both city manager I'm not going to put words in the city managers but I think we were anticipating that we would have this for at least what we were told that there was going to be this meeting with all of the participants all the representatives from all the cities in Metro that are part of the Metro inet that we would be able to voice whether you were going to be doing a b and c and we were going to try to find out a little bit more from what are they providing and what's going to be happening in the future one of my concerns from that meeting and I shared it with our city manager was that I okay let's say I understand what you're trying to do and building up and you're going to hit us a 20-something percent increase of which equates to that seventy two thousand dollars okay I'll take that what does the future look like are am I going to be seeing 20 increases moving in the future or is this part of of this catching up on a fund balance which I totally agree because we would end up having to do the same type of thing is it going to be more you know a three percent into the future one of the responses of the individual was theirs that uh you know a lot of the service contracts that they are getting for some of the supplies or contracts that they have that they're seeing and they're seeing in the future that they would be like 10 increases to me it's kind of like yeah we need to start looking and getting a better understanding um and not that the city and the staff has not had this as a discussion in the past um uh um our communication Specialists are she's much more than that Kerry has brought up that we really need to look at this technology in the services that are being provided and there are some other options that we could look at but I think it really starts councilmember Thurston it really starts with that we need to be able to define those Services be able to put an RFP together and then get it out on the street just to find out where we're at and I'm not by no means casting blame on you or anyone I'm just this simple questions of that you know I've asked here and and that you know they we've been using this company or this outfit for 20 plus years but there's still questions on what services they provide you know it to me that's concerning and that you know our service contract with them should probably outline all the services that we're paying for or they're providing because my concern too is that this is probably just one of those things that they provided good services and we've just never really considered changing and we've had no reason to and then they probably have not had significant increases like this which would trigger someone to ask well what are we getting for this um but where I'm going with this is that you know if we're maybe part of these you know because they obviously provide a wide range of services maybe there's some services that we're paying for that we're not utilizing we've seen that with uh what's this software program that we struggled with with the billing in code or is that what it was called well we can't make changes to it and you know all these things and there's other stuff that come with it that maybe we weren't using and utilizing and then we made a switch to this other thing and we're still kind of there's duplication and so it's just an inefficient process but at some point hopefully we move away from that and we're we're using what we're paying for and um if if they they obviously provide a service and if it's an all or nothing and not like an A La Carte type of thing great but if if we can say well you know we don't have to get our internet service from you we can get it from someone else for cheaper we should look at that we you know but if that eliminates them saying well then we're not going to do everything that's another maybe red flag that say well why why would we limit ourselves to that if it means you know saving thousands of dollars or especially over the course of you know 5 10 20 years or whatever so I would just hope that it's not a question of well we don't want to do it because we're stepping on toes or anything but I just hope that we're gonna go down that path of looking at RFP with this and other services that we've traditionally always had and you know it's it's no disrespect like our attorneys are our Engineers everything it's not a lifetime contract and it's our responsibility to make sure we're getting the best deal here too I understand we develop relationships over these years but you know we have an obligation that taxpayers take you know good practice every four to five years maybe doing RFP and make sure they're in line with everything else so let's remember Thurston I absolutely agree and that was part of that Workshop that you know part of the workshop you wanted to ask those questions was to identify those things because I'm in total agreement you know you know and some of them that pop into my head you you've just said you know it's it's not just Metro inet it's looking at the inspections contract that we have um it's engineering its attorney um yeah and and you know I I do want to qualify one component um to that is and and I won't go into any two points I want to make uh one I have challenged our engineer on numerous occasions um because I do not like how certain things are being done and I'm not going to go into that and so um they're actually making some changes on how we're seeing things um it doesn't mean that we we don't do an RFP at some point in time um there is a value for a relationship in familiarity with an organization so when we do an RFP I also want us to have a discussion on what is that Delta of savings that we need to achieve through the RFP before we actually move to a different vendor so many many many years ago um I looked at things and it was actually from a resource looking at things from the standpoint of do you Outsource our in-source you know a service and if you were currently having things done on an in-house that there needed to be at least a 10 percent savings from an Outsource for you to actually consider so and I'm not going to go into great detail about everything I think I still have the the manual of how to do all the calculations and that stuff onto it but what it was pointing out is that there are there is a value that's associated that you need to achieve before you really get a total realization but yes those items are all on that list and that was part of what I was trying to get at with that that Workshop is that to make everybody aware and really it's more to get staff to say okay we need to start looking at things that we've I guess taken for granted or done it's because we've always done it that way and so yes your notes very well taken and I I again I've said this to you before I greatly appreciate your thoughts your comments and your ideas because it really does spur myself and my staff on to coming up with different ways of looking at things other questions on this part I think the bottom line is you know this is something that has been increasing a lot we're hearing we have a Communications person now that can actually look at what we're you know what we have what are what are what are we working with I think Carrie offers a lot of institutional knowledge that we haven't had in the past where now having that person on staff can actually look at what we have what we need and be able to make a good you know decision based on what is out there absolutely I agree uh moving on to what do we have here um the equipment fund um we have a budget of uh 384 thousand dollars that's what's in the capital Improvement plan um there's revenues of 513 000 per the capital Improvement plan um details you'd have to look at the CIP plan for all of that that you've had the opportunity to to review we do still have some outstanding questions that were raised from council member Wong that we will address at one of the next two future uh workshops in addition that is going to go in front of the um Planning Commission and the Parks Commission for their approvals of the plan before it's brought back for final adoption from the city council skipped Insurance oh did I I was sorry I don't know what the thirty thousand dollars yeah um it's based upon uh so if there's a litigation and there's a claim that's ends up being made that we end up having to pay so there's nothing that is absolute about that this is based upon the past history of that account that we've we have ended up having claims of about thirty thousand dollars so I wanted to have something included in there um to do that and again the insurance um budget is balanced budget of 491 thousand dollars again what that means is that the revenue and expenditures are the same so it means we're getting revenues from other departments so this is being allocated out um the equipment fund um City mechanic is a balanced budget of thirty seven thousand dollars um the significant changes is that there's a need for um a number of small tool and minor equipment um that's needed by for the mechanic that haven't been replaced for a number of years so we've increased that about fifteen and a half thousand dollars um uh Building Maintenance um the budget is 495 000 uh revenues of 446 there will be a use of approximately forty nine thousand dollars of fund balance um to um supplement the expenditure or the budget side significant changes are supplies are increasing about 14 and a half thousand dollars contractual Services increasing about thirty four thousand dollars and capital needs in the building maintenance of approximately twenty one thousand dollars so that takes us through our internal service funds all of our fund balances if you remember at the end of last year and they're all projected this year to all be in the positive um we have no negative fund balances if you remember there was a negative fund balance in the internal service run on the mechanic and that has now been since then has been corrected the other budget budgeted funds that we do on a permanent basis are the community service fund Community event fund a Fire Relief Fund Park fund and Street Maintenance fund the community center fund the community center fund was created in 2020 to account for the rental revenues of the facility and Associated maintenance expenditures the budget shows this budget of our 2023 shows six months of rental Revenue at twelve thousand five hundred dollars per month and 139 600 for operating costs for the year um it's going to require 64 600 um to be uh to come from fund balance um and the long-term use of the building is still under um discussion any questions with that well that's on the assumption that the lease ends on June 30th I mean in theory it could be extended another six months to the end of the year and then we'd be in a positive in that positive position absolutely and again when I prepare budget I understand yeah nope I agree when I make when I open this up is that like this you know the comment of there's more than one way to slice the pie here you know I was gonna wait to the end but you know we talk about equipment funds and you know these monies that are budgeted to replace you know a Ford truck out of Public Works you know if something like this happens like we're talking about this huge jump in health insurance and we're scrambling to figure out well what can we do the only option isn't always just to raise taxes we could say all right let's take a look here instead of replacing this 2008 F-150 or 250 that's still in good condition and can still continue to work and still do the job we'll we'll put that off a few years and you know you can free up money in that sense because a lot of this stuff is you know and I get it you know we have this Capital Improvement plan we're trying to stick to it and doing that stuff it's just a but it's an option all right so you know when we get into these things like you know this the the community center fund that's a huge unknown too that's going to have a lot of costs it's going to have a huge impact on a lot of these things it could change the way we need to reevaluate that whole Capital Improvement plan and and change things and and re-adopt that or reapprove that but uh that's all just to know that you know these are options and there are other options altered as well and and I'm just going to make I'll make a comment back on their councilmember Thurston I agree with you there's there's always options what I try to do is and again I you know and and if I conveyed it you know I I certainly didn't want to um for the insurance increase it's not a doomsday um we have options um and I think we've got a very good option by the general by the general fund um I agree with you that you can you can delay um a payment out of you know the equipment fund you can transfer the funds over and and so forth um that that's that's a temporary fix um part of how I look at my my responsibilities and again I don't make the final decisions my responsibility is I make a recommendation with a plan looking out into the future um if the city council wants to make that decision and go in a different um way I'm you know I'm not going to have hurt feelings um I just try to try to make it everybody aware that um you know if you you buy down all your fund balances you um don't Levy eventually you're going to have to have to have huge significant significant increases to keep things afloat and so I'm trying to trying to to have kind of a better plan and make everybody aware but again I I certainly don't disagree with your your comments we absolutely can do that but I don't think that this insurance for health insurance um is is a doomsday component to it at all I think what I'm really trying to say is that hey you know you know we got one I think we've got a solution we've got a significant increase I think we've got a solution also to make you aware that it does appear that something that was a program that kind of kept us on a very low um Inc annual increase is now going to be something that could be much more volatile and that you know that we're all aware unfortunately we have a very small general fund budget in Levy and so approximately every sixty thousand dollars is a percentage increase in that Levy and that's really kind of one of the components that I was talking about very early on in our budget discussion is that we are a fiscal disparities winner and I want to make sure that we're protecting and getting as much fiscal disparity dollars as we possibly can because that doesn't come directly from our residents it comes from the residents around in the metro area it's it's a shared program and if we don't um you know if we don't Levy to a certain thing they're going to get our residents will pick up keeping everything constant they will have an increase coming into the next year with no benefit but I absolutely agree with your your comments and and I you know hopefully I've you know in my time here that I've always conveyed that I'm open to every idea and suggestion it's more of in the past the way apologies have been presented it's like here's our options I mean this is what we got for you and it's like a yes or no type of thing and it's I think it's just there's more to that and maybe it's and especially too in your in previous years when um you know there's been decisions that are I think in my opinion done purposely to make it painful when we had to hire police officers then lay them off and now this is dated this is going way back to you know 2010 2011 but it happened and it didn't need to so yeah just trying to point that out no and I think it's I think it's fantastic and again I appreciate your your insights um and I think that's that's where I think you know developing a a budget committee and having um um you know a couple of council members sitting on that in Residence and we start the process a little earlier um in the year to get some of those inputs and thoughts I think we can really flush a lot of you know you know those options questions um and we can develop a much more cohesive Budget moving into the future um Community event fund it's a pretty small fund it's right now just being utilized um for really the North St Paul car show and things past history it used to be for lifeguards um you know at the Silver Lake Beach Fire Relief Fund um and councilmember Thorson kind of talked a little bit a little bit about this right now we're we're not a part of the the state's fund on the Fire Relief it was created in 2019 to pass through North St Paul's fire state aid to the North Saint Paul Fire Relief and accumulated additional funding for future pension contributions to ensure 100 funding of the retirement benefits in 2021 the fire State a fire state aid was approximately seventy seven thousand dollars and well they're coming on this this is another one of those things kind of what I'm touching on when you're talking about options for budgets for many many years the city did not have to make a contribution and chose not to and and like the point you're making if you if you choose not to do those things it's going to come to head at some point and it did when the fun no longer was self-sufficient and and and then the city had to make large contributions and we're obligated to do that so that was putting a strain on the fund so the decision was made to say well let's take a look at the average contribution and let's do that whether we need to do that or not but then that changed as well because it's just that low hanging fruit to wear well let's just get rid of that 40 000 contribution of Fire Relief and then that frees up our money to do whatever else we want to do so just another example of what I'm trying to point out here yep um park fun the park fund was created to finance Capital Improvements related to the park system Park system the initial funding was donation driven but it's grown to grown to include reservation of Park facilities which we're estimating at about sixty three thousand dollars in the local government Aid of a hundred thousand dollars the fund also transfers approximately eighty thousand dollars to for uh debt payments related to the Casey Lake Pavilion when does that end the Casey Lake Pavilion payments I have to get back to you and then I'll shoot you a I'll shoot all of you an email on that and then the last budget that we have is a Street Maintenance fund and Street Maintenance fund was created to provide minor Rehabilitation to city streets most improvements are made with the maintenance overlay which is a process of Milling pavement on the curb line then overlaying a pavement mix on the existing Street this fund receives the annual Street Maintenance allocation approximately 151 thousand dollars local government Aid of fifty four thousand and beginning in 2023 a transfer from the general fund Street Maintenance that was that 198 000 really you know based upon our Capital Improvement plan knee to 150 000 being transferred into that but more to come on to that in the future all of the budgets are attached if you want to look at any of them or have any discussion on to those I'm more than happy to try to answer any questions you may have any my council member Thorson I just out of curiosity is there a way when you run those reports that you're seeing that are attached to omit the if there's no one a non-zero it's like you're you know I get it but it's just for more of like public consumption you're looking at these documents they're just full of zeros is there a way to just run a report and say don't you know only only print Fields with values not zeros unless the zero is relevant relevant you know I don't know I'm not familiar with the city I know it bothers me too okay so I guess I'm guessing that's a no it bothers people no they're they're um there there is a there is a way although yeah so I you'd have to hire another accountant well we don't want to go with that right um so this just the internal service fund it seems like these are just they're set up to charge make sure we're charging departments correctly for fee you know things like you know in years past we used to just put all the city's insurance and it was paid out of the Enterprise fund and that was never reflected in the city's general fund budget so it's just to make sure that these are accurate true budgets so if someone were to say well what's our fire department's budget compare that to Lake Elmo is that legit or not well North St Paul they don't have to cover insurance this is more of like a true cost of I.T and all that stuff so it's just it's a pretty simple thing that we're not having to you know we're just making sure we're covering our costs right it's just general councilmember Thurston I think that was a very good way of of describing it it's it's really so we show what the true cost of of let's say Public Safety is and in years past our kefir had indicated that there was one internal service fund that was running a deficit and that was the the city mechanic that has since been rectified and the reason why we have a city mechanic internal service fund is is mostly because there's a city mechanic that we have on staff and he performs work for Enterprise fund related activities being the electric Department mostly is that a correct assumption and that's why we have this fund yeah yeah I mean it's not um I don't know the only thing I would correct isn't that not necessarily mostly electric it's water Waste Water Street Maintenance so it's basically all of our vehicles that are in the city without with the exception of I don't think they touch anything on the public safety side to it so yeah because they're they're typically he's just working on Public Works equipment Enterprise equipment and once this the fire stuff is outsourced and same with the police vehicles attractive so that's that's why this is in here because some people might think oh sure why aren't why don't you have a you know uh department head you know I mean I guess we could uh if we wanted to but that's why that's here and that's why that comment was coming up in our k for that hey this fund's run out of deficit it's not good to have deficits right you should fix that so that's that's just been fixed over time allocating the true cost to what the city mechanics are working on okay yeah that was our question anybody else any questions if not uh thank you Dan it's uh a lot of numbers well uh mayor City Council Members once again I thank you very much um love the dialogue um you know and uh get a lot of insight and just shows that there's areas for improvements on a continuous basis and I love it always wrote very much absolutely all right thank you if there's nothing else uh city manager frandel anything else nothing further nothing else uh entertain a motion for adjournment by council member one second by councilman Peterson any discussion if not all those in favor signify by saying aye oppose uh we are adjourned for about five five minutes