2009 Key Financial Strategies
CITY OF
CHANHASSEN
7700 Market Boulevard
PO Box 147
Chanhassen, MN 55317
Administration
Phone: 952.227.1100
Fax: 952.227.1110
Building Inspections
Phone: 952.227.11SG
Fax: 952.227.1190
Engineering
Phone: 952.227.1160
Fax: 952.227.1170
Finance
Phone: 952.227.1140
Fax: 952.227.1110
Park & Recreation
Phone: 952.227.1120
Fax: 952.227.1110
Recreation Center
2310 Coulter Boulevard
Phone: 952.227.1400
Fax: 952.227.1404
Planning &
Natural Resources
Phone: 952.227.1130
Fax: 952.227.1110
Public Works
1591 Park Road
Phone: 952.227.1300
Fax: 952.227.1310
Senior Center
Phone: 952.227.1125
Fax: 952.227.1110
Web Site
www.ci.chanhassen.mn.us
MEMORANDUM
TO:
Mayor & City Council
FROM:
Todd Gerhardt, City Manager
DATE:
~.
January 9,2010
SUBJ:
2010 Key Financial Strategies
Happy New Year!! I am very appreciative of the opportunity to work with City
Council and Department Heads to establish our upcoming 2010 Key Financial
Strategies. Staff will be reviewing our 2009 strategies and request City Council
direction on whether the strategy has been completed, needs additional
information, or should be moved to the "ongoing" list. Following that
discussion, staff will present the attached 2010 Draft Key Financial Strategies.
This is the City Council's opportunity to refine our strategies to meet your
, expectations. Upon completion of staff's presentation, the City Council will be
asked to provide additional strategies/goals for 2010 that will be added to the
master list for prioritizing.
Come prepared to share your ideas/goals for 2010!
Please call me if you have questions regarding our session on Saturday,
January 9th at 8:30 a.m.
ATTACHMENTS
1. 2009 Key Principle Strategies & Accomplishments
2. 2010 Draft Key Financial Strategies/Strategic Plan.
3. Schedule for 2010 Key Financial Strategies.
g:\admin\tg\key financial strategies\201O\cc memo 1-9-1O.doc
Chanhassen is a Community for Life - Providing for Today and Planning for Tomorrow
2009 Key Principle Strategies & Accomplishments
ESTABLISH ANNUAL GOALS & KEY FINANCIAL
STRA TEGIES
Background: Staff met with Jim Prosser from Ehlers & Associates to begin
development ofthe city's key financial strategies in July 2002. At that time, we
completed comparisons of similar cities based on tax base mix, growth, allocation,
population, five-year budget comparison, debt ratios, tax capacity, and bond ratings.
Council and staff identified Financial Foundation Descriptions and prioritized capital
improvements. The City Council adopted the Key Financial Strategies on June 9,2003.
Implementation began with the 2004 Budget process, i.e. pavement management system
including trails, roads, parking lots; debt service; fixed assets for remodeling!
replacement; water treatment and future infrastructure; etc. We also will use these
strategies as a part of our 2010 strategic planning process.
Update: The City Council and staff reviewed and modified the 2008 Key Financial
Strategies on January 10, 2009, which included the following:
1. Review 2008 Key Financial Strategies.
2. Discussed Strategies that were completed, needed more information, and those that are
on-gomg.
3. Discussed the City Council's and staff's proposed 2009 Strategies.
4. The City Council approved their 2009 Strategies at their February 19,2009 meeting
(see Attachment #1 for a list of the 2009 Strategies).
The following identifies the 2009 Key Principle Strategies and
Accomplishments
COMPETITIVENESS
Create an environment for innovation and change-building on our strengths, creativity,
and skills.
Promote Economic Develovment
Update: Staff has worked on several items this past year to promote economic
development. Listed below are some of the items that were presented to the City Council
on August 24, 2009:
1. City Code amendments:
a. Electronic message centers and community signs
b. Logos on signs (30%) and cabinet proportions (20% can be flat cabinet)
G:\Admin\TG\Work Plan\2009 Accomplishments.doc
November 9, 2009
1
/llfd1fnev1f 1F / ~.
-;:::::::::-
2. Permitting LED lighting in commercial and office projects.
3. Standard for drive-thru aisles beyond banks only.
4. Meeting with the Chanhassen Business Council of the SouthWest Metro Chamber of
Commerce to discuss replacement of their sign.
5. Continue to market City property:
a. Public Works Facility
b. Highway 5 and TH 101
6. Facilitate the downtown Park-and-Ride and future development in the area.
7. Support the "Buy Chanhassen" program.
8. "Working Together Program" where the Mayor and City Manager meet with several
business owners/CEOs asking such questions as:
. What key issues are affecting your business, i.e. service, regulations,
infrastructure (electricity, gas, roads, etc.) and restrictions?
. What can the City do for you to make your company more successful?
The goal is to maintain relationships with these firms for business retention and
expansion in Chanhassen. When our existing businesses thrive, so does the rest of the
community.
Consider Options for Historic St. Hubert's Church
Update: In March, city staff presented the City Council with two options for the long-
term ownership/management of historic St. Hubert's Church. Meetings were held
between representatives from the Chanhassen Historical Society, St. Hubert's Church,
Council members Ernst and Litsey, and staff to discuss their vision for the church. After
several meetings, it was decided that the city would terminate their lease agreement with
St. Hubert's as of August 1,2009. Notice was sent to St. Hubert's and utilities were
transferred into their name as of that date.
STRENGTHEN THE CITY'S FINANCIAL POSITION
Provide financial stability and resources necessary to achieve the city's vision by
exercising financial stewardship, implementing best practices, and utilizing long-term
financial planning tools.
Review Financial Policy
Update: In October, staff presented the city's financial policy and recommended changes
in accordance with new standards and practices. Staff also provided a quarterly update
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 2
November 9,2009
on the performance of the city's investments and the future outlook for the portfolio. The
following is a summary of the proposed policy changes:
1. The debt policy section was removed. As part of its key financial strategy goals in
2007, the city adopted a separate debt policy that is more detailed and all inclusive.
2. Language was added to address GASB 40. The statements discuss common deposit
and investment risks related to credit risk, concentration of credit risk, interest rate
risk, and foreign currency risk.
3. Safekeeping language was added to the policy that outlines the types of entities with
which the city can hold securities.
4. The authorized investments section was enhanced by adding detail to each asset class,
ratings criteria, and FDIC language for certificates of deposit.
5. A concentration of credit risk section was added to prohibit an over-exposure in any
one asset class and/or issuer.
Comvile List of Unfunded/Unvroductive Mandates for Lef!islative Review
Update: Staff presented a list of significant unfunded/unproductive state and federal
mandates to our local1egislators on March 10, 2009 (see Attachment #1). Senator
Ortman, Representative Hoppe, and Metropolitan Council Representative Craig Peterson
were present and took our concerns under advisement.
Preliminary 2010 BudJ!et and BudJ!et Efficiency Discussion
Update: In June of 2009, the City Council gave staff direction on the 2010 Budget
process. To improve efficiency, all department heads presented their requests at a
meeting held on October 26th, as opposed to presenting over several meetings as we have
in the past. I received positive feedback from department heads and they would like to
see this process used again for the 2011 Budget.
Planning for the City's Infrastructure
Create solutions for managing existing infrastructure and future growth in our
community while preserving a sustainable quality of life and protecting the environment.
Work with Other AJ!encies to Advance the Imvlementation of HiJ!hway 101
Imvrovements from Lyman Boulevard to the Scott County Line
Update: Staff hosted a meeting on March 10,2009, to discuss the TH 101 Corridor
Scoping Study, issues, and recommendations for this southerly section of TH 101 (see
Attachment #2). Agencies that participated in the meeting included Scott County; Carver
County; the Cities of Shakopee, Chaska, and Eden Prairie; and MnDOT. All the agencies
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 3
November 9,2009
were supportive of the project and suggested that we apply for Transportation
Enhancement dollars (STP) to fund the segment of TH 101 from Lyman Boulevard to
Pioneer Trail. MnDOT anticipates $104 million in federal dollars to allocate in this
solicitation. Staff anticipates a preliminary decision on whether or not the project will be
funded in December.
Review Potential Options for State Bonding Bill
Update: At our June 8th meeting, staff presented five projects to be considered for the
2010 State Bonding Bill, including:
1. TH 101 Improvements from Lyman Boulevard to the Scott County Line.
2. TH 5 Improvements from TH 41 to CSAH 31.
3. Ravine Stabilization in Lower Bluff Creek.
4. Bluff Creek Drive Trail and Water Quality Project.
5. Highway 5 at Minnewashta Parkway Trail Underpass.
Staff presented this list to Representative Hoppe and it was his intention to send it to
legislative staff for their feedback on the likelihood of these projects being funded.
Highwav 5 Improvements, Including Minnewashta Parkway Intersection
Update: Staff has been working with the City of Victoria and MnDOT officials in
upgrading the intersection of Highway 5 and Minnewashta Parkway. Staff applied for
HSIP (Highway Safety Improvements Program) funding. The application included
widening and paving the shoulders, acquiring additional right-of-way, wider striped fog
lines, safety edging, closing the access to Lone Cedar Lane, and replacing and adding
guardrail where needed. The estimated cost of the project $1 million. MnDOT is very
supportive of this project and is assisting the city through the funding process. We
should know by early December if the project will be funded. If the project is funded, it
is anticipated the improvements will be made in conjunction with MnDOT's preservation
project scheduled for 2011.
Look for Partners for Storm Water Improvement Pro;ects
Staff gave a lengthy presentation on potential partnering agencies that may initiate or
complete surface water management projects in the city. These include the following
agencies:
1. Minnesota Pollution Control Agency (MPCA)
2. Minnesota Department of Natural Resources (DNR)
3. Minnesota Board of Soil and Water Resources
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 4
November 9,2009
4. Carver County Soil & Water Conservation District
5. Riley-Purgatory-Bluff Creek Watershed District
6. Lower Minnesota River Watershed District
7. Minnehaha Creek Watershed District
8. Carver County Water Environment and Natural Resources
Staff is currently working with MPCA, DNR, and MnDOT to restore some of the Bluff
Creek erosion problems around Vogelsberg Trail and Highway 101. Staff will continue
to foster our relationships with agencies and access outside grant/funding opportunities to
maximize our investment in the Storm Water Management Improvement Plan.
Work with Carver County to Advance TH 41 Trail & Pedestrian Underpass
Improvements
Update: In July 2007, the City Council adopted a resolution of support to apply for
Transportation Enhancement (TE) funds for a bicycle/pedestrian underpass beneath
TH 41 by Minnewashta Regional Park. Carver County and the City of Chanhassen were
awarded the funds in 2008. Carver County intends to construct the underpass and trail in
2010, but the project may carryover into 2011. Carver County is scheduled to make a
formal presentation on the project at the November 23,2009 City Council work session.
Follow-up on Justification Study for Fire Station #3
Update: Staff presented a follow~up report on the Justification Study for Fire Station #3
at the July 27th work session.
The report included comparing Chanhassen Fire Department response times to those of
neighboring communities. The National Fire Protection Association's (NFPA) standard
for response time is 4 minutes. The Chanhassen Fire Department's response time is
currently 5: 10. Response times for neighboring communities are:
Chaska 4:38
Excelsior 6:00
Hopkins 4:20
Eden Prairie 6:10
Minnetonka 6:52
Fire Station No.1 is currently 11,785 square feet and Fire Station No.2 is 2,793 square
feet. To man a third station, the city would have to increase the total number of
volunteers from 45 to 60, or 15 new firefighters. The annual cost of adding the third
station (not including construction costs) is projected to be:
Wages
Utilities
Cleaning
Impact on Fire Relief Retirement Account
$60,000
$15,000
$ 5,000
Unknown
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 5
November 9,2009
The city has not received any indication if the ISO rating would increase or decrease with
the addition of the third station and additional staff.
Enhance Local Tax Base
Evaluate the Comprehensive Plan with current goals and policies; assess the impact.
MeetinJ! with Downtown Businesses Ref!ardinJ! New ZoninJ! to Intensify Development:
Update: Staff organized a downtown business district informational meeting on June 23,
2009. Approximately 30-40 people attended who were property/business owners in and
around the downtown area. Staff discussed the findings of the McCombs Office/
Commercial and Residential Market Analysis and gave an update on the 2030
Comprehensive Plan. The group supported the idea of intensifying the downtown
commercial district, but also expressed concern regarding the traffic on Market
Boulevard and the number of turning movements. Prior to completing a traffic study,
staff suggested that we wait to see how the ring-road around the Chanhassen Dinner
Theatres affects the situation by providing a secondary access to West 78th Street.
Support the Marketplace-Driven Development of Industrial, Commercial, and
Residential Land:
Update: Listed below are some of the different programs staff has completed in
promoting economic development:
1. City Code amendments:
a. Electronic message centers and community signs
b. Logos on signs (30%) and cabinet proportions (20% can be flat cabinet)
2. Permitting LED lighting in commercial and office projects.
3. Standard for drive-thru aisles beyond banks only.
4. Meeting with the Chanhassen Business Council of the Southwest Metro Chamber of
Commerce to discuss replacement of their sign.
5. Continue to market City property:
a. Public Works Facility
b. Highway 5 and TH 101
6. Facilitate the downtown Park-and-Ride and future development in the area.
7. Support the "Buy Chanhassen" program.
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 6
November 9,2009
8. "Working Together Program" where the Mayor and City Manager meet with several
business owners/CEOs asking such questions as:
. What key issues are affecting your business, i.e. service, regulations,
infrastructure (electricity, gas, roads, etc.) and restrictions?
. What can the City do for you to make your company more successful?
The goal is to maintain relationships with these firms for business retention and
expansion in Chanhassen. When our existing businesses thrive, so does the rest of the
community.
OTHER PROJECTS AND GOALS THAT WERE ACCOMPLISHED
Veterans Monument
Update: City staff, the Chanhassen American Legion, and volunteers planned and carried
out the Dedication Ceremony for the Chanhassen Veterans Monument on May 25, 2009.
The fundraising efforts have been completed and over $80,000 was raised. The City
Council accepted the donation of the Chanhassen Veterans Monument at their May 26,
2009 meeting.
National Night Out
This 26th annual National Night Out took place on August 4,2009. This is the city's
ninth year participating in the program. There were 46 neighborhood block parties in
Chanhassen with the goal of heightening neighborhood crime prevention and awareness.
Thank you to the Mayor and City Council, Carver County Deputies, Carver County
Mounted Posse, and Chanhassen Fire Department for visiting the neighborhood block
parties.
Carver County Service Center Ribbon Cutting
Carver County celebrated the grand opening/ribbon cutting of the new service center on
April 21, 2009.
Chanhassen High School Grand Ovening
School District 112 celebrated the grand opening of the new Chanhassen High School on
August 28. The first homecoming parade was held in downtown Chanhassen on
October 9,2009.
Bond Rating Uvgrade
Standard & Poor's upgraded the city's bond rating to AAA in 2009. Only ten other cities
in the State of Minnesota have a similar rating. Their rating reflects:
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 7
November 9,2009
1. Participation and access to the strong Minneapolis-St. Paul metro area coupled with
the city's own steadily growing and diverse employment base;
2. Very strong income and wealth levels; and
3. Maintenance of very strong reserves, coupled with conservative and strong financial
and debt management policies that include long-range budget and capital plans.
Standard & Poor's FMA of "strong" indicates financial practices are strong, well
imbedded, and likely sustainable. Highlights of these policies include management's:
1. Formalized debt management policy;
2. Monthly reports to the City Council on budgeted numbers compared to actual
performance;
3. Four-year financial forecast and capital improvement plan that it updates annually
and includes estimated costs and revenue sources; and
4. Formal reserve policy of keeping a general fund balance of at least 50% of the next
year's property tax revenue and state aid for cash flow purposes.
The city also has a current informal general fund policy, discussed on an annual basis, to
keep an additional 15% catastrophic reserve of the following year's expenditures.
The City Council and staff should be very proud of this significant financial achievement.
Public Works F acilitv
1. On January 6,2009, the Planning Commission approved the site plan.
2. On January 26, 2009, the City Council approved the site plan.
3. On February 23,2009, the City Council approved plans and specifications and
authorized advertising for bids.
4. On March 23 and April 13, 2009, the City Council approved bids and quotes.
A few changes orders have been necessary due to Building Code requirements; however,
the project is under budget by approximately $500,000. Construction is ahead of
schedule and occupancy is anticipated in mid-December.
2009 Street Imvrovement Proiect
Update: At the January 12,2009 meeting, City Council accepted the Feasibility Study
and called the public hearing.
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 8
November 9,2009
At the January 26,2009 meeting, City Council held the public hearing and authorized the
preparation of plans and specifications. Three property owners spoke at the public
hearing and five property owners submitted written comments to the Council.
At the February 9, 2009 meeting, City Council approved the plans and specifications and
authorized the advertisement of bids.
At the April 27, 2009 meeting, City Council held an assessment hearing and approved
bids for the street project.
The project milled and overlays 3.1 miles of streets and included industrial/commercial,
urban and rural residential areas. In all, 355 properties benefited from this project. The
project came in on schedule; however, the contractor did have scheduling issues that staff
had to work through. Overall the project was a success.
Money Magazine's "Best Places to Live"
Update: Money Magazine ranked Chanhassen No.2 on its list of 2009 Best Places to
Live. We were recognized for our high quality of life, strong financial position, and
stable economy. Money Magazine's ranking of Chanhassen was also based on criteria
such as strong local economies, great schools, affordable homes, low crime, and
proximity to cultural activities. We all should be proud of this prestigious ranking, which
is the result of years of dedicated and committed service by many people and groups in
the community. Chanhassen is a great place to live!
2009 Budget Shortfall
Update: Staff provided the City council with quarterly updates on the 2009 Budget
shortfall. Staff also provided a list of potential revenue shortfall ideas totaling over
$700,000. It is estimated that revenues in the general fund will be approximately
$650,000 short of the original budget. The City Council will take formal action on
revising the 2009 Budget at the December 14, 2009 regular City Council meeting.
G:\Admin\TG\Work Plan\2009 Accomplishments.doc 9
November 9,2009