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<br />e M I NUT E S <br /> Eugene City Council <br /> Dinner/Work Session <br /> Jacobs Room--Hult Center <br /> September 20, 1988 <br /> 5:30 p.m. <br /> COUNCILORS PRESENT: Ruth Bascom, Rob Bennett, Freeman Holmer, Jeff Miller, <br /> Emi ly Schue. <br /> COUNCILORS ABSENT: Debra Ehrman, Roger Rutan, Cynthia Wooten. <br /> The adjourned meeting of September 19, 1988, of the Eugene City Council was <br /> called to order by Mayor Brian Obie. <br /> 1. KEY SERVICE AREA POLICIES <br /> A. Policy Framework and Financial Strategy <br /> City Manager Mike Gleason gave an overview of a document containing a draft <br /> mission statement and policies for key service areas supported by the City.s <br />- General Fund. He said the policy statements and background material <br /> represent an initial effort to develop a policy framewo~k so the council can <br /> address the General Fund's financial problem. <br /> Mr. Gleason said the goal of the City is to balance the General Fund; it <br /> currently faces a deficit of $1 million to $1.5 million per year. The <br /> primary cause of this shortfall is that expenditures continue to increase <br /> while revenue does not. Expenditures increase for several reasons: the cost <br /> of services and wages go up annually, there are both internal and external <br /> service additions (e.g., wetlands, hazardous materials, celebrations), and <br /> increased service demands caused by growth of the city. Mr. Gleason said <br /> that in order for the General Fund to remain neutral, its baseline must <br /> increase by 3.5 percent per year. He said if the General Fund were not <br /> increased for one year, it would amount to a six-percent cut. <br /> In response to a question from Ms. Bascom, Mr. Gleason explained that a six- <br /> percent increase in property tax represents an increase of approximately 2.75 <br /> percent to the General Fund. This does not offset the difference between the <br /> increase in expenditures and the revenue. <br /> Ms. Bascom asked why the strengthening economy does not have more of a <br /> positive effect on the General Fund. Mr. Gleason said none of the revenue <br /> sources in Eugene are elastic; they do not grow at a rate equal to, or <br /> greater than, the growth of the general economy. <br />e MINUTES--Eugene City Council September 20, 1988 Page 1 <br />