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City ponders loss of community development director

The elimination of the community development director position was legal, according to the opinion of the city's attorney.

In a memo sent Aug. 12, City Attorney Al Felix says the Bemidji City Council "acted within its authority both to create as well as to eliminate the position."

The council voted 4-3 Aug. 10 to eliminate the position by the end of 2009 and apply the savings toward the city's general fund for 2010.

While Felix said the council was acting within its legal authority, based on the city's charter, he said the question of whether it was a "reasonable" action is more of a public policy question.

"I'd respectfully suggest that the council reflect upon, among other things, the minutes of the Feb. 4 (2008) meeting (in which the position was created), and consider how best to redirect, redefine and strengthen the position, rather than eliminate it," Felix wrote.

Felix wrote that he developed the memo based on a request by Mayor Richard Lehmann, who was one of the three councilors opposed to the elimination of the community development director position, currently held by Rita Albrecht, the city's former assistant planner.

Lehmann said in an interview Tuesday that he asked Felix, who did not attend the Aug. 10 work session, for a legal opinion because staff management has traditionally been handled by the city manager.

The Aug. 10 work session had been scheduled to be a discussion of a preliminary tax levy. City staff had advocated for a 21.9 percent levy increase, which would have restored more than $450,000 lost in Local Government Aid cuts in 2008 and 2009.

While discussing a potential preliminary levy, select councilors raised the issue of possibly cutting the community development director position. The argument was made that cutting the position would lower the preliminary tax levy.

"It's a budget issue," said Councilor Jerry Downs on Tuesday. "It's being accountable to the taxpayers."

The city staff, however, is refuting the claim that the staff reduction is necessary to lower the tax levy.

City Manager John Chattin sent a memo Aug. 12 in which he explained that the 21.9 percent proposed tax levy would have generated a surplus of more than $125,000.

"If the council believed that the levy is needed to balance our 2010 budget, then I must apologize for any misunderstanding," he said.

Chattin explained in an interview Tuesday that the surplus was factored in as a "cushion" against any future LGA cuts.

Even if the council were to adopt a levy increase of 19.9 percent, as Downs suggested, that would establish a surplus of more than $75,000, Chattin wrote in the memo.

Both potential levy increases include the assumption that the city would have no reduction in full-time city staff members.

"Any staff reductions are not being driven by the proposed budget or by administration," Chattin wrote in the memo.

The city would accumulate some additional savings upon the elimination of the community development director position. But exactly how much is not specifically known yet.

When hired, Albrecht received about $58,000 for an annual salary, plus benefits.

For 2010, the city budget had included $89,000 for salary and benefits, according to Finance Director Ron Eischens.

The entire budget for community development for 2010 was planned to be $103,666, Eischens said, which included such expenditures as travel, supplies and professional services.

Downs said saving $103,000 would lower the tax levy by 3 percent, and according to Eischens, it takes about an additional $37,000 to increase the levy by 1 percent.

The city taxpayers have had more than their share of double-digit levy increases in recent years, Downs said.

"At what point do you say enough is enough?" he said.

The council will need to clarify its expected reductions as the budget process advances, Eischens said.

Downs said the disbursement of Albrecht's duties should not be too difficult, considering that the position is barely one year old and all her duties were previously covered by city staff.

"There is some overlap of job functions and redundancy that could be eliminated," he said.

Additionally, the council will need to decide the future of its development funds, which are now managed by Albrecht.

When the community development director position was created in 2008, the council directed that the person holding the position would also oversee the City Development Fund and Revolving Loan Program.

Traditionally, the Joint Economic Development Commission had administered those funds. In return for its services, the JEDC had received $20,000 from the interest of those funds.

But in December, the council voted to discontinue having the JEDC administer those funds and instead had Albrecht administer them, which was a duty listed in the job description of the community development director.

So what will happen to those funds once the community development director position has been eliminated?

"We haven't really discussed the division of duties because the reality is that the burdens staff already are facing are excessive," Chattin said.

Chattin does not believe, however, the loans will be returned to the JEDC.

"I don't see that happening," he said. "They've all been transferred to the city."

The administration of the existing loans requires "minimal" time, Chattin said, but there is much more time required to accept, receive, review and award new grants.

Even if the majority of Albrecht's current duties are dispersed among existing staff, Chattin said no one on city staff could handle her planning responsibilities because "no one on city staff has planning experience."

That would leave the planning needs to the Greater Bemidji Joint Planning Board, which represents the city of Bemidji and Bemidji and Northern townships.

Downs said the joint planning office is funded, in part, through city tax dollars and that the JPB would cover the city's planning needs.

But Chattin said that won't work.

For example, the city just submitted and received approval of the Planned Unit Development of the south shore redevelopment.

While the JPB was able to review the 140-page document, Chattin said, it could not actually develop it.

Rather, Albrecht spent more than 100 hours compiling the data and working with the city's consultants for the PUD, Chattin said.

"From the city's perspective, we need a planner to go through the document and look at how it relates to the greater Bemidji area planning ordinance," he said.

When asked if he would then expect the city to hire a part-time planner to cover Albrecht's current duties, Chattin said that issue has not been resolved.

"We haven't gotten that far," he said. "We're still trying to salvage that position."

And Chattin isn't alone.

Five individuals representing the Bemidji Area Chamber of Commerce, Downtown Development Authority, nonprofit organizations and a former city staff member addressed the council on Monday as they asked councilors to reconsider their previous action.

The council did not respond to them at the time. However, budget discussions will continue this coming Monday as the council will meet in a 5:30 p.m. work session to discuss the potential financial impacts of annexation.

The first phase of the annexation is set to begin in 2010, if the city chooses.

Lehmann said he has no idea if the council will reconsider its previous action.

"The onus is mostly on the four who voted to terminate," he said.

Downs said he would support another look at a similar position, with tweaks, in the future, at some point at which the city's financial position may change.

"It's very difficult to cut positions. It's one of the hardest jobs of being a city council person," he said. "We just have to do what we think is right for the taxpayers."