BY COUNCILOR NESS:
The city of Duluth does ordain:
Section 1. That in accordance with Section 58 of the 1912 Home Rule Charter of the city of Duluth, and all amendments thereof and laws supplementary thereto, and for the fiscal year beginning January 1 and ending December 31, 2005, the city council hereby budgets, determines and states the amount of money required to meet the principal and interest of maturing obligations comprising the outstanding indebtedness of such city; the amounts of money necessary to be provided for each such fund and each department of such city; and estimates the amount of income from all other sources and revenues, exclusive of taxes upon property, together with the probable amount required to be levied and raised by taxation to defray all expenses and obligations of such city during such fiscal year.
That the monies as so budgeted and hereinafter set forth shall be paid upon the presentation of properly verified vouchers bearing thereon the budget distribution for which such expenditures are to be charged in accordance with the detailed classification of accounts and the explanatory information of such as set forth in ordinance in effect governing same, excepting, however, payments for interest and sinking funds, which shall be paid in the manner set forth in Section 53 of the City Charter.
That any monies received by the several city departments as reimbursement for damages or repairs to city property or work done for others and not anticipated in the original budget may be credited to and added to the appropriate budget item upon approval by the administrative assistant or his designee.
That use of general fund balance that has been designated for a specific purpose in a prior year, must be approved by the city council if used for a purpose other than what has been specified.
That grants which have been approved by the appropriate state or federal agency and accepted by resolution of the city council may be added to the respective budget items upon approval of the finance director.
Section 2. That the finance director be authorized to approve the payments of $3,245,600 from the gas and steam public utility funds to the general fund for administrative services; comprised of $3,165,600 or seven percent of the gross revenues of the gas utility fund to the general fund; and $80,000 from public utility steam fund to the general fund.
Section 3. That the mayor or the administrative assistant or his designees may make transfers from budget item to budget item as may be considered necessary for the proper administration of the city government for the year. However, the total of any transfers to or from any budget item in excess of ten percent of the appropriation therefore as herein made shall be made only upon approval of the city council. For the purpose of the Section, the term budget item shall mean the amount appropriated to the various funds delineated as fixed charges in the budget summary, the accounts numbered 010 through the 700 series shall each be considered budget items within the general fund, as defined in Chapter 8, Section 54 of the City Charter, and the accounts numbered 510 in the water division, 520 in the gas division, 530 in the sewer division, 535 in the stormwater division, 540 in the steam division and 503 in the golf division.
Section 4. That the salaries shall be in accordance with the pay plan in effect as provided by Section 22 of the City Charter, as amended.
Section 5. That the city auditor may create or abolish an accounting fund when required by law or proper accounting procedures.
Section 6. That the finance director, or his designee, be authorized to make temporary loans to and from the city’s various funds as needed in the conduction of the day-to-day operations of the city.
Section 7. That the appropriations as set forth in this section constitutes the budget of the city of Duluth for the calendar year of 2005.
Section 8. That the administrative assistant or his designee shall provide the council with a final budget report within three months of the end of the budget year setting forth the original approved and the modified budgets for each line item included in this ordinance and explaining in narrative form the reasons for any significant differences between the original approved and the modified budgets.
Section 9. That the city will review all state and federal grants prior to acceptance to determine the program’s funding status. A statement should be included on each grant resolution outlining items such as whether the grant represents a one time revenue, an ongoing funding source, or a partial funding source with a local match required. The future fiscal impact of the program on the budget will be discussed prior to acceptance of the grant.
The programs funded by state and federal grants shall be reduced or eliminated accordingly if state or federal revenues are reduced or eliminated and another funding source is not secure. Local funding will be available after a full review to determine whether the program should be continued.
Section 10.That this ordinance shall take effect January 1, 2005.
STATEMENT OF PURPOSE: This ordinance establishes the city of Duluth budget and appropriates monies for the operation of city departments. Provisions of this ordinance are in conformance with the Duluth City Charter and Minnesota state law. The ordinance sets the 2005 budget for the city’s general fund, the five utility funds of water, gas, sewer, stormwater, and steam, and the golf fund. The budgets for all funds have changed from the original budget proposal presented to the city council in september. The general fund budget was decreased by $1,218,800 from the original proposed budget. The reduction was necessitated by the council’s action to reduce the proposed property tax levy from a 20% increase to a 5.7% increase - leaving a funding gap of $1.453 million. The gap was eliminated by using a combination of revenue increases and expenditure decreases as discussed with the city council at budget meetings throughout the past few months.
The four city utility funds were decreased from the original proposed budget to reflect the final 2005 health insurance premium rates that were ten percent lower than what was originally anticipated. The decreases were as follows: the water fund - $61,700; gas fund - $80,000; stormwater - $8,800. The sewer fund decreased by a total of $3,520,600 due to a combination of the new insurance premiums and the elimination of the pass through expense of wastewater treatment charges for Lake Superior Paper.
The steam fund increased $24,000 due to staffing and insurance issues.
The golf fund decreased $207,200 from the proposed budget due to the refinancing of the fund’s debt as approved by the city council last month.