Mayor Hawkins called the special Council meeting to order with Councilmembers Price, Amenn, Hunt, and Turner present. By motion of Councilmembers Amenn and Price, Councilmember Minder was excused. (Clerk’s Note: Councilmember Minder arrived a few minutes later.) City Clerk Gilleland was also present. Public Works Director Light was absent due to illness.

The purpose of the meeting was to hold a workshop on proposed expenditures for the 2005 budget. Mayor Hawkins called Council’s attention to the contents of the packet sent out with the meeting notice and began discussion regarding salaries, benefits, and personnel policy issues.

Mayor Hawkins explained that the employees did not receive a cost of living increase for 2004. The salaries in the proposed 2005 budget provided to Council reflect a proposed 3.5% increase for 2005. This represents the 2003 CPI plus the 2004 CPI.

An initial poll of the Council indicated Councilmember Turner and Amenn were in favor of a 0% increase due to the present financial situation; Councilmembers Price and Hunt were in favor of the proposed 3.5% increase because of no increase in 2004 and all employees are doing extra work; Councilmember Minder was in favor of at least 1.75%, which represents 50% of the proposed 3.5%. Much discussion followed, including the possibility of a retirement plan. Council asked for a brief review of the other budget line items before deciding on the salary issue.

City Clerk Gilleland briefly explained some of the additional revenues for the General Fund that have been added since the revenue workshop. Property taxes will increase by $28,000; the Water Utility tax will increase by $5,000; and about $1,800 more PUD Privilege Tax will be received.

City Clerk Gilleland reviewed where expenditure cuts were made throughout the various departments for 2005. Supplies and other operating line items have been reduced to the lowest possible level in all Funds. In the General Fund, there is no travel for the council, no web site or travel in the finance department, no cleaning for city hall, no security system for city hall, the liability insurance went down by $4,044, attorney’s fees are estimated low, Children’s Day, National Night Out, seasonal decorations, and Visitor Bureau dues have been cut out and the museum isn’t funded in the preliminary budget. We don’t have exact figures yet for court costs related to police activities and the Sheriff’s contract has not yet been negotiated and settled. The contract has been estimated lower in the preliminary budget for 2005 than the actual paid in 2004. Nothing has really been budgeted for the Planning department, except for $500 for supplies.

The Street fund is basically the same as previous years. Using $2,000 from vehicle operating supplies covers Snow removal. The Water Fund is estimated as low as possible. The Water Capital Improvement Fund is about the same as previous years.

Salary Increase Decision: After reviewing the above information and additional discussion, a second poll of the Council indicated Councilmember Turner, Minder, and Amenn were in favor of a 1.5% increase and Councilmembers Hunt and Price were in favor of the proposed 3.5% increase. The majority set the salary increase for 2005 at 1.5%.

Personnel Policy Issues: Mayor Hawkins called Council’s attention to the requests from staff regarding changes to the personnel policy. The requests include that the pay grid be amended by eliminating three ranges that are not needed; revising the maintenance positions to Utility Maint I, II, and Water Manager; moving the Utility Maintenance II position to Range 6; moving the Utility Clerk position to Range 5; granting one day per month administrative leave for the exempt employees; and eliminating the bi-annual step increase from the pay grid to allow annual longevity merit increases.

By consensus, Council agreed to the proposed changes requested by staff.

Review of Bond and Miscellaneous Funds: City Clerk Gilleland provided background information and reviewed the budgets for the GO and Water Bonds, Impact Fee Funds, the Recycling Fund, the Street Improvement Fund, the Water Emergency Reserve Fund, and the Municipal Capital Improvement Fund. Some discussion was held regarding the fact that City Hall’s exterior needs to be maintained for sure next year.

The meeting was adjourned by motion of Councilmembers Hunt and Minder.

ATTEST: ________________________

Colleen Hawkins, Mayor

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Hester Gilleland, City Clerk-Treasurer