Regular Meeting
September 15, 2009
The Mayor and Council
of the City of Fairbury met in regular session in the Council Chambers
located at 612 D Street, Fairbury, Nebraska, on the 15th day of
September 2009,
at 7:30 p.m. Mayor
Homer L. Ward called the meeting to order.
Notice of meeting was
given in advance thereof by publication in the Fairbury Journal News,
Fairbury, Nebraska, the designated method of giving notice, as shown by
affidavit of publication. The Open Meetings Act was posted in the meeting
room and pointed out by Mayor Ward as required by law.
Roll call found the
following Council Members present: Doug Brown, Ron Byrd, Don Trimm, Beryl
Lueders, Shirley Bender, and Brad Kuzelka. Absent: Kelly Davis and Ed
Friesen.
Mayor Ward called for
the submittal of forms to request future agenda items. No forms were
submitted during the meeting.
Mayor Ward read the
Consent Agenda:
1.
Approval of the minutes of the
regular meeting of September 1, 2009.
2.
Approval of claims.
3.
Approval of the August 2009
Reconciliation Report.
4.
Approval of the appointment of
Diann Pape to the Fairbury Housing Authority; term to expire May 2013.
5.
Approval of the reappointment
of Bob Stepp to the Planning Commission; term to expire September 2012.
Byrd moved to approve
the Consent Agenda. Motion seconded by Trimm. On roll call, Brown, Byrd,
Trimm, Lueders, Bender, and Kuzelka voted “yes.” Friesen and Davis
absent. Motion carried.
Mayor Ward opened the
Budget Hearing and Budget Summary for the 2009-2010 Fiscal Year. Brian
Blobaum of Blobaum & Busboom, P.C explained the budget process has two legal
items that it addresses. One is we set the dollar amount of property tax
for the General Fund and the Bond Fund; and the other is, we set an
expenditure limit of overall expenditures for the City for the entire year.
Blobaum stated we have a lot of data regarding how much we’re budgeting to
spend in the General Fund, Street Fund, Police Fund, etc.; all those numbers
are internal numbers that are put together. The total of those creates a
legal limit; so we’re not limited by line item or by fund, we’re limited by
the total. That total can be changed in the middle of the year, if the City
would choose to amend the budget. However, we would have to go through the
budget process of publishing to amend the budget; but it can be done. We
have the chance right now to set the property tax request. Blobaum stated
the tax asking for the General Fund for the 2009-2010 Fiscal Year is
$503,952.00 and the Bond Fund is $250,000.00. This is a total tax asking of
$753,952.00 which compared with the prior year was $778,000.00 which is a
3.1% decrease. (Last year the General Fund was $508,000.00 and the Bond Fund
$270,000.00.) The tax levy request for the General Fund is 47.1¢ which is
the maximum amount we can ask for the General Fund because we have given the
Airport Authority the remainder of the 50¢. The Bond Fund is not limited
and the City has chosen to reduce that from $270,000.00 to $250,000.00. The
overall limits of expenditures that are set up in this budget are the cash
balances that we have on hand, plus anticipated revenues, less normal
operating expenditures. Then we have budgeted basically all of the money
that we have generated plus our cash reserves to be able to be spent as
capital outlay items. The expenditure limits in the General Fund for
2006-2007 were $5,444,645.00, for 2007-2008 - $4,421,808.00, the amount
projected for 2008-2009 - $4,882,643.00, and for 2009-2010 we’re budgeting
$6,860,145.00; this is budgeting to spend all of our cash reserves plus
normal expenditures. Blobaum continued with an overview of cash positions
historically and for the upcoming year, stating that in comparing the
General Fund budget to prior years budgets – he looks at budgeted reduction
in cash reserves and adjusts for rebudgeted funds such as LB840 (which
really isn’t our money to spend on anything); so subtracts that out of the
reduction. In comparison, in 2007-2008 we budgeted to reduce cash reserves
with those adjustments by $41,330.00 and actually increased by $221,430.00,
in 2008-2009, the current year, we budgeted to reduce cash reserves by
$113,629.00 and estimating we will actually reduce by approximately
$270,577.00 and for 2009-2010 we have budgeted to reduce cash reserves by
$118,854.00. However, we don’t know how the current year will turn out; if
we will have an increase or decrease. Last year we had a significant
decrease; so this is a little warning. The estimated yearend cash reserves,
on October 1, 2009, in the governmental funds should be approximately
$1,095,000.00 of which about $595,000.00 is reserved; not available for
general purposes such as salaries, etc. The reserved funds, which we can
not touch, are LB840 of $508,000.00, fire equipment of $13,000.00 and the
remainder is grants and trust funds. In the early 80’s the cash reserve was
as low as about $400,000.00 and in the 90’s the reserve reached as high as
$1.5 million. Blobaum stated the current spendable cash reserves of about
$500,000.00, of the City, are still near a thirty year low; we are at the
lower end of the spectrum. We need to have at least $200,000.00 -
$300,000.00 in cash reserves because of the timing of the revenues coming
in. We do have $1,095,000.00 in a joint checking account but half of it is
obligated to LB840. Blobaum stated the expenditure limits that have been
set in the budget for 2009-2010 for the General Fund is $6,860,145.00, the
Bond Fund $1,090,589.00 and the Keno Fund $31,797.00. Blobaum stated these
do not add up to what was published in the paper, which was $17,154,635.00.
The Proprietary Funds (the utilities) have their own budget (which they had
their hearing in May); these numbers are included in this budget. The
budget notice in the paper includes these numbers so it is much larger
because of this. Blobaum stated this budget requires a change of 3.1%
decrease in the property tax; if we decide to decrease the property tax, we
are required to have a separate hearing to change the dollar amount of the
property tax request. No one else addressed the Council during the public
hearing. Mayor Ward declared the hearing closed.
Mayor Ward opened the
public hearing concerning the setting of the final tax request for the
2009-2010 Fiscal Year at $503,952.00 for the General Fund and $250,000.00
for the Bond Fund. Blobaum stated the final tax request for last year for
the General Fund was $508,000.00 and the Bond Fund was $270,000.00. This
year’s tax request is a 3.1% decrease from last year. No one else addressed
the Council during the public hearing. Mayor Ward declared the hearing
closed.
Trimm moved to approve
the 2009-2010 Fiscal Year Budget as presented. Motion seconded by Kuzelka.
On roll call, Brown, Byrd, Trimm, Lueders, Bender, and Kuzelka, voted “yes.”
Friesen and Davis absent. Motion carried.
Blobaum presented the
City of Fairbury Enterprise Funds Financial Statements and Schedules for
Year Ending April 30, 2009. Blobaum stated his firm is issuing a clean
audit opinion but that he is required to report internal control
deficiencies. Blobaum continued with an overview stating in Exhibit A of
the Financial Statements and Schedules – the Statement of Net Assets (which
is a Balance Sheet) shows approximately $4.8 million in cash reserves
between the cash and certificates of deposits and a debt of approximately
$1.8 million. In Exhibit B – the Statement of Activities (which is an
Income Statement) shows change of net assets (which is net income) for the
fiscal year of $831,972.00. Blobaum stated the Light & Water Department
shows a net income at the year ending April 30, 2009 of $712,260.00 versus
$745,476.00 last year; and the Sewer Disposal Department a net income of
$119,712.00 versus $66,685.00 last year. Blobaum stated in 2007, 2008, and
2009 have had definite increases in gross profit which has contributed to
strong net incomes. Blobaum stated in 2006 the Power Margin was 40% and in
2007 and 2008 the Power Margin was close to 50%; this is basically when the
utilities changed from a loss position to a profit position. Cash reserves
are growing in the utility funds; the balance at the beginning of the fiscal
year in 2009 was $4,146,788.00 and the ending balance at the end of the
fiscal year was $4,824,151.00. Blobaum stated one significant internal
control deficiency is the lack of separation of duties, which may be too
costly to warrant correction. Blobaum stated another material weakness,
which they have to indicate when they prepare the financial statements and
notes, “although the city officials reviewed and approved the draft
financial statements and notes prior to signing the representation letter
and finalizing the audit, we believe that there is an inadequate design over
the controls related to the preparation of the financial statements and
notes. We do not feel that the city officials possess the expertise to
detect and correct a potential misstatement in the presentation of the
financial statements or notes in accordance with accounting principles
generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing
Standards.” Blobaum stated their has been significant improvement the last
couple years since the City has gone to City Administrators. Byrd moved to
approve the City of Fairbury Enterprise Funds Financial Statements and
Schedules for Year Ending April 30, 2009. Motion seconded by Kuzelka. On
roll call, Brown, Byrd, Trimm, Lueders, Bender, and Kuzelka, voted “yes.”
Friesen and Davis absent. Motion carried.
Bender moved to approve
transferring $40,000.00 from the Keno Fund to the General Fund and the same
$40,000.00 from the General Fund to the Swimming Pool Fund. Motion seconded
by Trimm. The funds were made available to the Swimming Pool Fund for
essential repairs, which were completed this past summer, to the pool. A
total of $50,000.00 will eventually be transferred as the Keno Fund can
afford the transfer, which should be early in the new fiscal year. On roll
call, Brown, Byrd, Trimm, Lueders, Bender, and Kuzelka, voted “yes.” Friesen
and Davis absent. Motion carried.
Byrd moved to authorize
Mayor Ward to sign the final project reports for the CDBG #07-PP-020
Fairbury Housing Market Study. Motion seconded by Brown. These documents
are part of the closeout related to the Fairbury Housing Market Study
completed this past year. On roll call, Brown, Byrd, Trimm, Lueders,
Bender, and Kuzelka voted “yes.” Friesen and Davis absent. Motion carried.
City Administrator
Joseph Parker stated he has been getting questions from people regarding the
application process for demolition for the Neighborhood Stabilization
Program. Parker stated the City has not signed the contract yet, but we
should be receiving it soon. Parker stated the City has placed a boxed ad,
which will be in the paper this week, to have applicants pick up
applications in the City Clerk’s office. Parker also has program
guidelines. The structures need to be located within the City of Fairbury
corporate limits. The applications will be subject to a scoring system by
Parker and Building Inspector Eric Voss to be prioritized, will need letters
from homeowners stating they are in agreement with the demolition, we have
to take pictures of the houses and send them to the Nebraska Department of
Economic Development (NDED), and we have to get approval of each house from
the NDED. Hopefully, the City will be able to go out for bids this winter,
with the demolition process starting soon after.
Mayor Ward read by
title Resolution No. 740 setting the 2009-2010 property tax request at
$503,952.00 for the General Fund and $250,000.00 for the Bond Fund. Brown
moved to adopt Resolution No. 740. Motion seconded by Kuzelka. On roll
call, Brown, Byrd, Trimm, Lueders, Bender, and Kuzelka voted “yes.” Friesen
and Davis absent. Motion carried.
Mayor Ward read by
title Resolution No. 741 designating depositories of the City of Fairbury
and approving the pledge of assets as security from said banks. Byrd moved
to adopt Resolution No. 741. Motion seconded by Trimm. On roll call,
Brown, Byrd, Trimm, Lueders, Bender, and Kuzelka voted “yes.” Friesen and
Davis absent. Motion carried.
Mayor Ward read by
title Resolution No. 742 authorizing the Mayor and/or City Administrator to
release liens levied for nuisance abatement when paid. Brown moved to adopt
Resolution No. 742. Motion seconded by Lueders. City Attorney David Bargen
stated this is a blanket authorization to help speed up the process for
releasing abatement liens after payment in full of such costs and expenses
for which the lien was filed. Further approval by the City Council for such
routine lien releases would not be required. On roll call, Brown, Byrd,
Trimm, Lueders, Bender, and Kuzelka, voted “yes.” Friesen and Davis
absent. Motion carried.
Mayor Ward read by
title Resolution No. 743 notifying the Jefferson County Treasurer to take
all action required to collect on delinquent assessments and amounts for
Street Improvement District No. 2004-2. Trimm moved to adopt Resolution No.
743. Motion seconded by Kuzelka. Bargen stated the County Treasurer had
informed the City of such delinquent special assessments of which he needed
authorization, on this particular document, by the City to take action to
collect. On roll call, Brown, Byrd, Trimm, Lueders, Bender, and Kuzelka
voted “yes.” Friesen and Davis absent. Motion carried.
Within the City
Administrator’s report, Joseph Parker stated he had heard from Denny Graham
with Olsson’s Assoc. Graham wanted the City to be aware grant money is
available from the Nebraska Department of Natural Resources for a flood
study to be done for the City. We will need to set a Public Hearing for
October 20, 2009. Parker stated the City is also looking at the LMI
(low-moderate income) levels within the City, for future CDBG acquisitions;
so may be asking for money to do a study of the LMI levels in the City.
This may also make changes to our Comprehensive Plan. Parker stated he has
also been visiting with the county and school to see if they’re interested
in having a meeting once a month or
so; maybe have the
administration and one person from each board get together to let everyone
know what they’re doing and to join forces in regards to sharing equipment,
etc like the copier/scanner.
Within the Mayor’s
report, Mayor Ward stated he had a meeting today regarding LB840.
Byrd moved to adjourn
the meeting. Motion seconded by Lueders. On roll call, Brown, Byrd, Trimm,
Lueders, Bender, and Kuzelka voted “yes.” Friesen and Davis absent. Motion
carried. Meeting adjourned at 8:00 p.m.
Homer L. Ward, Mayor
ATTEST: Sharyl Preston, City Clerk
