City Council Minutes 2007 09 25 SP

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City Council Special Meeting Minutes September 25, 2007 Page 5 of 6 up with maintenance responsibilities and anticipated increases in water treatment expenses Wastewater fund e:penses are proposed at $1,304,000 in 2008 compared to $1,18!9,000 budgeted in 2007 reflecting higher salaries and energy costs No increases in rages have been included in the budget; however, Staff is proposing considleration of a 2% water/wastewater rate increase to offset the increased cost of operations as well as an increase in storm water rates. This will <~void the need for more significant increases in future years. Public Works Director Phare reported these funds are in good shape. Internal Funds Other Issues and Oveirall Summary: - Staff is developing a number of options for reducing the cost of the 22% health plan increase proposed by the City's carriers. At this stage, the City budget includes an additional $137,000 for medical coverage in 2008 across all funds to reflect a 10% increase. - The proposed budcfet would increase regular salaries by $453k over all funds with $66k in General Fund, $215k in Conservation Trust, $139k in Water/Wastewater and $33k in Capital Projects. This increase includes the new 21008 pay plan adjustments, merit increases, 1 % for part-time employees and additional positions for 2008. - Adopting the proposed budget would add1.5 FTEs in Water/Wastewater, and a net increase of 1.0 FTEs in the General Fund (2 new positions offset by the deletions of the R&SS Director's position). City Manager Fleming advised a~ modest and cautious approach to budgeting in the years ahead. He wants to incorporate a biennial budget, which does not necessarily save money but does save time spent each year on the process. He also thanked each of the directors for all the time and effort put into the preparation of this budget. Human Resources Manager Hix reported the employee committee looking at options in the health care package is working hard and will have a recommendation soon. Budget Calendar -City Manager Fleming outlined for Council the calendar for the next two months with final approval of the budget to occur on November 5, 2007.