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HomeMy WebLinkAbout07-11-2022 BAC Minutes w/AttachmentCITIZENS BUDGET REVIEW ADVISORY COMMITTEE MINUTES OF REGULAR MEETING JULY 11, 2022 Chairman Napier called the Citizens Budget Review Advisory Committee meeting to order at 6:01 p.m. II. Pledge of Allegiance was recited by all. III. Roll Call Present Mr. Napier Mr. Newhart Mr. McGinn Mr. Hall Ms. Cerda Absent Mr. Hoffman — Excused Mr. Sullivan — ExcusedJ 4 Ms. Reed -- E: c�rsE[� Also Present Ken Killgore, Administrative Services Director/CFO Paul Carlisle, City Manager Barbara Brooke -Reese, MIS Manager Joseph Perez, AV Technical Assistant Janet Graham, Technical Writer IV. ADDroval of Minutes A. Meeting of May 16, 2022 Mr. Napier asked if all Committee members had reviewed the Minutes of February 14, 2022. All indicated they had. Mr. Napier stated that on Page 4 under his comments, it should read that he has been a proponent of using recreation impact fees at the golf course. it states in those Minutes that "Mr. Napier opined that those funds should be left under capital improvements at the golf course..." is incorrect He asked that the recreation impact fees should be used at the golf course. A motion approving the Minutes of May 16, 2022 as amended was made by Mr. McGinn, seconded by Ms. Cerda, and approved unanimously via voice vote. V. Presentation of Draft Budget by Ken Killaore. Administrative Services Director/CFO A. Power Point Presentation CITIZENS BUDGET REVIEW ADVISORY COMMITTEE PAGE 2 MINUTES OF JULY 11. 2022 Mr. Killgore stated that he has kept the format the same as in previous years. He emphasized that the budget that he has provided to the Commissioners this evening is a draft. A power point presentation (SEE ATTACHED) was made, and he reviewed the General Fund Budget, the Enterprise and Other Funds, the Capital Improvement Program, property value changes and the possible millage rate and some other items for the Committee to consider. The draft that was submitted this evening includes an increase in personnel costs, operating expenditures, capital spending, and basically a credit, as the City had large transfers out of the General Fund this year so that it looked like we were reducing transfers. Actually, there are no transfers in next year's budget out of the General Fund. To sum that up, the increase at this point is 3.18%. He is expecting the health insurance estimates any day now. Staff is underway with the negotiations on the labor contracts. He included six full-time positions in the General Fund Budget. The City is adding one parttime position as well as deleting one parttime position. Also is a City Manager's assistant, an assistant in Human Resources, three police officers, and a construction specialist. Operating expenses are up, and he reviewed those items. The f golf wurse is doing well this year, however, in the long-term projections, he has reduced that projection for next year down50°7o. He is anticipating that the golf carts will last for another year. Because of delivery times and reduction in schedules, we will probably order the golf carts in this coming year for delivery to be in place for the next year. The airport also looks positive, and he reviewed the projections for the airport. Regarding the American Rescue Plan Act, the City has received all the funding, and the monies have been allocated to the Gardenia Ditch, Schumann Drive, Concha Dam, employee retention payments and road improvements. Those funds must be obligated by December 31, 2024 and totally spent by December 31, 2026. Property values and millage rates were reviewed in depth. He called attention to the figure on page 21 where it lists last year's millage as 3.0043. That should be 2.8658. He explained the entries labeled Other Considerations. Mr. Killgore reviewed the remainder of the draft budget and then called for comments/questions. 2. Questions or Comments by Members Ms. Cerda — • She asked regarding the minimum wage increase in September and asked if the City is doing anything to address that. Mr. Killgore said there is a compensation study that has been completed, and that is part of the negotiations with the unions. Mr. Hall — • Asked regarding the fund balance projection. Mr. Killgore stated the City is doing well on the fund balance, but the question is whether that can be applied to an ongoing expense. CITIZENS BUDGET REVIEW ADVISORY COMMITTEE PAGE 3 MINUTES OF JULY 11, 2022 • Regarding the roads, he asked if there is $500,000.00 allocated to roads? Mr. Killgore stated there is $500,000.00 out of the American Rescue Fund for this coming year, before the December 2024 deadline, and there is $600,000.00 for resurfacing out of gas tax monies plus $250,000.00 out of gas tax for improvements. Mr. Hall asked if that is meeting the City's needs. Mr. Killgore stated the City had commissioned a paving management program to be prepared by the consultant, and the City Engineer said that she is hoping to get it by the end of this month. Hopefully, we will have that before the budget approvals. Mr. Carlisle expanded on this subject. Three years ago he had the pavement management program instituted where every roadway in the City was evaluated. From that, a six -year paving program was developed. That has been followed for three years. In year three, which is where we are now starting the fourth year, we will do a new evaluation so that we know if the implementation process that was put in place is either maintaining our pavement condition index or it is getting better. If it is getting worse, we need to look at another management tool to add in order to keep up the pavement index range at the 74%, which is really good actually. If that index is dropping down and our roads are getting worse, then we need to look at a different process. We will not know that until we get the final study back from the pavement management company. • Referring to page 2 of the budget, the collective franchise fees are budgeted as revenues coming in a bit higher than even what is projected for this year. He asked what the reason for that was. Mr. Carlisle stated that there was a huge increase in utility rates this year, and then it backs off a little bit the next two years. But this current year was the first year where they had a fuel adjustment and a rate adjustment. That is why you will see an increase in franchise fees in this budget, but not so much in the next two years. • On Page 3, Mr. Hall asked what RRD management fees is. Mr. Killgore said that stands for Riverfront Redevelopment Regarding the staff member who is the Director of the CRA, his staff looks at the percent of time that she devotes to CRA matters as opposed to general Planning and Zoning matters. Her percentage did drop. • As to the code enforcement fines, there is a projection of $61,000.00. Is that based on what is collected? Mr. Killgore stated that is based on the amount we have collected to date. Historically, it is not that high. Mr. Killgore said this figure represents collections; it is not just the amounts that were billed for liens. Mr. Carlisle explained that there were a couple of properties that sold that had extensive liens against them. • Regarding facilities maintenance, he noted that the expenditures projected are considerably higher than this year. Mr. Killgore replied that he did comment on that on one of the slides. Because we are opening up the new public works facility, the electric bill proposed for that facility shows additions to what is now being paid under the old facility. So it did go up substantially. CITIZENS BUDGET REVIEW ADVISORY COMMITTEE PAGE 4 MINUTES OF JULY 11, 2022 Mr. Carlisle stated those amounts are recurring. There is a huge facility out there. He added that staff put all the electric bills that were spread out over different departments into one fund to be able to manage it better. There was an increase in staff because of the increase in facilities to manage those facilities better. Referred to the increase in equipment for the MIS department. Mr. Killgore stated that is maintenance fees for the software. Some of that is related to cyber security. Ms. Brooke -Reese, MIS Manager, reviewed the reasons for the increase, such as the modern technology in the new building and the maintenance of software. Under the Law Enforcement Trust Fund, he asked if the City has any canines that the police might need and, if so, was there consideration for using this fund for the canines. Mr. Carlisle stated there is no anticipated need for any additional canines at this time. The City has three, and that is probably the extent of what staff anticipates. He added that the City just purchased two new canines to replace two that have retired. Asked if the police officers are equipped with body cams. Mr. Carlisle stated the City officers do have body cams as well as vehicle cams. Mr. McGinn -- Referred to street management and asked how the fuel allocation is addressed. Mr. Kilgore stated the fleet management budget does not cover the cost of all our fuel purchases. They are charged back to the departments. Mr. McGinn stated he would tend to err on the conservative side. Mr. Kilgore justified not allocating a significant percentage there just because, in the past, when we have had fuel increases, we have been able to basically absorb them within the departments' budgets. Mr. Carlisle explained that when the new public works facility was built, we did not have non -tax off -road fuel for all of our vehicles. When the new facility was built, a 5,000-gallon off -road no -tax fuel was established for our heavy equipment. So we are not paying fuel tax on our heavy equipment. We purchase our fuel through a cooperative, so our prices are not near as much as the prices you see at the pump. Asked if we know how much fuel is bought in total. Mr. Carlisle said the City knows exactly to the gallon how much fuel we buy. We have a fuel -monitoring system in every vehicle. This new system is much more accurate. Mr. Napier -- Reiterated that he would like to see recreation impact fees used at the golf course, as he sees DST money is used by the airport. Some of it is paid back, but not a BUDGET REVIEW ADVISORY COMMITTEE PAGE 5 MINUTES OF JULY 11, 2022 lot of it. He does not see any DST money going to the golf course, and they are both enterprise funds. They should be treated equally. Mr. Carlisle said that the difference is, if the airport's DST fund is revenue generated, they have to pay it back. We did use some of that at the golf course when some of the improvements were done. It cannot be used for maintenance. It is to be a capital improvement project. Asked if staff thinks we can get another year out of our golf carts. He added that there are other issues with some of the golf carts besides the batteries. Mr. Carlisle said it really does not matter, because we cannot get them for a year anyway. Asked if the new golf carts will be leased. Mr. Killgore added that in his draft budget he assumes the golf carts would be a lease -purchase kind of arrangement. An outright purchase is probably doable. Mr. Carlisle stated he projects that they will be a direct purchase. Asked if there is anything in the budget for the coming year that would be an expense that is going to come as a result of the annexation agreement. Mr. Carlisle said there is no anticipated cost to the City for that. B. Discuss Setting Proposed millage for the TRIM Purposes Mr. Napier stated his understanding that this is what they advertise. They can lower that at the Council meeting, but they cannot raise what is advertised. Mr. Killgore stated that is correct. Mr. Killgore stated that in the past, staff has given the Committee members time to think about the draft budget. At the next meeting then you can actually take a vote or a consensus opinion, or however the Committee wants to handle what you would recommend to the City Council. He stated that staff is proposing that at least staying with the current millage rate of 3,0043. Mr. Carlisle added that the 2.8658 is how the budget is balanced. The TRIM is that we would set it at the current rate because we cannot project what is going to happen. It can always go down. So now we would ask the Council to set a TRIM amount. The budget is balanced without using any reserves at the 2.8658, but the rollback rate would require $300,000.00 in reserves to balance the budget. With rollback, you will not have a balanced budget, plus or minus. Mr. Killgore agreed that this is correct. Mr. Napier inquired regarding adding three police officers. Mr. Carlisle stated that the biggest challenge he has is the number of complaints about speeding in neighborhoods. He would like to step up enforcement and try to make the neighborhoods safer. That is one of the biggest complaints he gets. He wants to be sure that we are covering those neighborhoods and being able to back up our officers. Our officers' safety and our CITIZENS BUDGET REVIEW ADVISORY COMMITTEE PAGE 6 MINUTES OF JULY 11, 2022 residents' safety is one of his top concerns, and he wants to make sure that we are doing everything we can to provide that. Mr. Napier said he would like to see the City get as close to rollback as possible. Mr. Killgore emphasized that there are still some unresolved issues that are not budgeted for, and to keep that in mind. Mr. Killgore put the slide back up on the screen entitled "Other Considerations." There was general discussion regarding those items. There being no further discussion, Mr. Carlisle recommended a voice vote on the draft budget. -* Proomen Milla6E Al"VTe A motion to move forward with the recommended draft -budget was made by Ms. Cerda, seconded by Mr. Hall, and approved unanimously via voice vote. Mr. Killgore added that there will need to be a change to the budget calendar that was published earlier. The first public hearing on the millage will be held on September 13' instead of September 19". There will be another meeting next week to consider the third quarter financial report and to make a recommendation to City Council as far as the proposed millage rate that you think would be appropriate for Council to set. Council's final hearing on this matter will be during their regular meeting on September 28'h. VI. public Comments Ms. Sherrie Matthews, Sebastian. She understands regarding the police officers. She would like a brief explanation on the six positions. She would like to know if the clerical position is a position that has gone unfilled and is found to be no longer needed. On the Human Resources assistant and the assistant to the City Manager, she would like to know haw those recommendations came about. Mr. Carlisle explained that the HR position used to be a four -position department. Due to the cuts in 2006, the City lost those positions. Now, there are more employees, and we have been asked to do more with our applications. There is just way too much for one person to oversee with 189 employees and one HR Director. As to the clerical position, that position was for scanning of documents. That has been caught up, so that position is not needed. As to the assistant to the City Manager, if you see his calendar and what his duties and obligations are, it is a need, not a want. If someone tries to get a meeting with him, sometimes it is three weeks out because he is swamped. Ms. Matthews asked if there has been any type of analysis or job study done. Mr. Carlisle stated that the organizational chart that the Assistant City Manager manages shows that the Assistant City Manager will take over some departments, and Mr. Carlisle will maintain some departments. Ms. Matthews asked regarding the Airport Director. She noted that a lot of extra duties of that position, were disseminated to other places. Mr. Carlisle emphasized that the City does not have the full number of staff in departments such as Planning and Zoning and Engineering. So his expertise that he has in public works is utilized to help review all those contracts, development plans, meeting with developers. That leaves him little time to actually do work with all the meetings he has to have. CITIZENS BUDGET REVIEW ADVISORY COMMITTEE PAGE 7 MINUTES OF JULY 11, 2022 VII. Next Meeting Date — Monday, July 18, 2022 to Review 3' Quarter Budget Report Vill. Adjourn There being no further business, Chairman Napier adjourned the meeting at 7:15 p.m. -*APPfOJeD /�Y 7th£N1ED Bv: Date: ChaWLaryapier jg 2023 Budget and Capital Program Presentation on Draft 2023 Budget Budget Review Advisory Committee Meeting Monday July 11, 2022 Prepared By: Ken Killgore Administrative Services Director/CFO 1 2023 Budget and Capital Program o Summary of General Fund Budget. • Enterprise and Other Funds. • Capital Improvement Program • Property Values and Millage •Other Considerations. ;I Draft FY2023 General Fund Budget Versus Amended FY2022 Budget 530,685 Personnel Costs 243,817 Operating Expenditures 75,861 Capital Spending (392,708) Transfers to Other Funds 457,655 Increase in Budget — 3.18% 3 Draft FY2023 General Fund Budget Personnel Up $530,685 o Health Insurance At a 5% Increase. o All Personnel Cost at Current Pay Rates. (Negotiations Are Underway.) o Adding Six Full-time Positions. o Adding One Part-time Position. o Deleting One -Part-time Position Draft FY2023 General Fund Budget Personnel Additions/Deletions o Six Full-time Additions Assistant City Manager Human Resources Assistant Three Police Officers Construction Specialist o +One Part-time Mechanic o -One Part-time City Clerk Clerical Asst. I Draft FY2023 General Fund Budget Operating and Interfund Transfers o Operating Up $243,817 Due To: $107,272 in MIS for P/W Complex and Software to Counter Cyber Threats. $131,163 in P/W for Complex ($76K Electric and $57K Rent). o Capital Up$75,861 From Parks Equipment. o $358,962 Decrease in Fund Transfers Due to 2022 Transfers for Yacht Club Seawall. Draft FY2023 General Fund Budget Revenue Assumptions o Property Tax At a Millage of 2.8658 (6.8% Above Rolled -Back) to Balance Revenue to Expenditures. o Franchise Fees and Utility Taxes Looking to be $131,672 or 9.3% Above This Year's Budget. o State Revenues - $693,893 or 22.3% Above This Year's Budget, Due to Higher Half Cent Sales Tax and State Revenue Sharing. Using 3.5% for 2023. 0 32.7% of Property Tax, 10.7% of Franchise Fees, 21.8% of Utility Taxes and 26.2% of State Revenues Equals 91.4% of Total Revenues. 6.M Draft FY2023 Enterprise Funds: Golf Course o Enjoying Good Year. 2023 Budget Assumes This Continues. Long-term Forecast Adjusted Down 15% And Still Able to Cover Expenses. o Same $30,000 for Restaurant Lease. o Same $106,135 for Airport Rent. o $36,209 Principal and Interest on $700,000 Building Fund Loan. o $35,000 toward General Fund Loans. o Expecting Sixth Year on Golf Carts But Will Be Ordered in 2023 for Delivery in 2024. 8 Draft FY2023 Enterprise Funds: Airport o Property Rental Revenue Covering Operating Cost and Loan Payments to DST Fund. o Loans From Discretionary Sales Tax Fund: Hangar A $285,000 - $253,172 By 9/30/22. Hangar B $267,511- $249,575 By 9/30/22. o Grant Matching From DST Fund: $579,273 in 2023 For Square Hangars and Half of Rehabilitation of Runway 05-23. $1,305,258 Over the Following Four Years For Rest of Runway 05-23, Taxiway Alpha Apron, Taxiway Golf, Shade Hangar and Runway 13-31. M Draft FY2023 Enterprise Funds: Building o Permit Revenue Continues at High Levels And Above Budget. o Covering Personnel and Operational Cost. o Adding Plans Examiner and Permitting Technician in Event They Can Be Hired. o Expecting $36,209 Principal and Interest Payment on Golf Course Loans: $700,000 Loan Will Be $553,963 By 9/30/22. $559,684 Loan To Be Paid After the $700,000. 10 Draft FY2023 Special Revenue Funds o American Rescue Plan Act Fund: Promised Funding Totally Received. Allocated to Gardenia Ditch, Schumann Drive, Concha Dam, Employee Retention Payments and Road Improvements. Must Be Obligated by December 31, 2024 and Totally Spent by December 31. 2026. Improvement Projects Need Plans and Permitting Which Require Some Time. 11 Draft FY2023 Special Revenue Funds o Local Option Gas Tax: Collections 3.03% Above Same Months of Last Year. Projecting 3% for Future Years. Road Improvements Are Pending Update to Road Assessment Study. o Providing $250,000 Annually for Reconstruction. o Providing $600,000 Annually for Repaving. o Providing $75,000 Annually for Sidewalks. Will Make Final Payment of $122,174 on Bank Notes December 1, 2022. 12 Draft FY2023 Special Revenue Funds o Discretionary Sales Tax: Collections Up 20.5%. Using Same as Last Year for Rest of This Year, Then 3%. (Needs to be Renewed by December 31, 2023) Funding for: oMIS Infrastructure. oPolice Vehicles and Equipment. o Roads Division Heavy Equipment. oEmergency Generator & New A/C Units oStormwater Bulldozer/Infrastructure. o Matching Funds for FAA and FDOT Grants. 13 Draft FY2023 Special Revenue Funds: o Riverfront CRA Fund: Operating Expenditures: oAudit Fees, Administration, Landscaping, Waterfront Renovations, Other Facility Maintenance, and Submerged Land Leases. oTravel and Education Cost, Legal Ads, State Fee, Association Dues and Landfill Fee. • Special Events. ^ Kiosk Signs in 2023. Riverfront Event Space in 2025. 14 Draft FY2023 Special Revenue Funds: o Recreation Impact Fee Fund: Unspecified Improvements ($5K per Zone). Swing/Bench Park at Harbor Lights is Scheduled for 22-23. Future Playground/Park Improvements: o23-24 Creative Playground. o24-25 Bryant Court Park. o25-26 Hardee Park and Schumann Park. o26-27 Community Center and Friendship Park. o27-28 Riverview Park. 15 Draft FY2023 Special Revenue Funds: o Stormwater Utility Fund: Cutting Two Maintenance Worker Slots. Replacing Crew Truck. Scheduled Improvement Projects: oAeration Fountain at Cownie Pond. oStonecrop Drainage Phase II and Canal Restoration with Grant and DST Fund Match. oTulip Road Crossing, Bayfront Road Crossing and Ocean Cove with DST Funding. oGardenia Ditch, Schumann Drive and Concha Dam with American Rescue Plan Funding. Q. Draft FY2023 Special Revenue Funds: o Law Enforcement Forfeiture Fund: Used Only for Unbudgeted Items. Specific Items Need City Council Approval. Current Balance is $52,692. o Parking In Lieu Of Fund: Current Balance is $87,466. Expecting $97,665 Year End 2022 Balance. 17 Draft FY2023 Trust Fund o Cemetery Trust Fund: of Sales on Operations and Maintenance: oAllocation for Grounds Improvements. oReplacement of Chain Link Fencing. oReplacement of Mower. of Sales Expendable on Expansions or Cost Incidental to Adding Future Sites: oFunds Columbarium Niches in FY 24-25. Looking at Market Rate Adjustment. is Draft FY2023 Debt Service o Stormwater Utility Note Final Payment by DST Fund Was Made in May 2022. o Paving Improvement Note Final Payment by Local Option Gas Tax Fund is Due on December 1, 2022. 0 60 Month Lease Purchase of Police Camera System to Mature on May 2025. 0 60 Month Lease Purchase of Required Police VxRail Security System Software. 19 Capital Improvement Program o $55.1 Million Over 6 Years. $20.3 Million Next Fiscal Year. o Largest Items for Next Fiscal Year: $1,460,586 Stonecrop Drainage. $11,500,000 Canal Restoration. $1,000,000 Square Hangars. $1,585,455 Runway 05-23 (1st of 2 Years). o $14,265,631 to be Funded by Grants. 9 Property Values and Millage: Certified Taxable Values o Rolled -Back Millage is 2.6834. Used 2.8658 for Draft Budget to Have Revenues = Expenditures. o Total Certified Taxable Property Values Increased $232,012,542 or 14.64% Above 2022. Additions Account for $47,981,095 or 3.03% of the Increase. Reassessments Account for $184,031,447 or 11.61% of the Increase. o Last Year's Millage of 3.0043 Would Increase Revenues by $618,532 Over the 2.6834 Millage Currently Assumed in 2023 Budget Draft. 21 Property Values and Millage: Taxable Value Additions Dollar Value of Tax Roll Additions: 2022 47,9811095 2021 321716,715 2020 33/685/698 2019 231351,814 2018 15/998/366 2017 35/951/704 2016 251763,700 2015 25/492/245 2014 191914,805 2013 9/435/090 2012 7/462/986 Tax Roll Additions Yield $123,602 of Added Revenue for 2023 at the 2.6834 Millage. 22 Property Values and Millage: 3.0043 Versus 2.6834 and 3.0043 1. 03% On Homestead: 3.0043 2.8658 3.0043 ASSESSED VALUES $200,000 $206,000 $206,000 TAXABLE VALUES $150,000 $156,000 $156,000 TAXES $451 $447 $469 CHANGE ($4) $18 ........... .................................................... _...... ._........ ASSESSED VALUES $250,000 $257,500 $257,500 TAXABLE VALUES $200,000 $207,500 $207,500 TAXES $601 $595 $624 CHANGE ($6) $23 On Others: 3.0043 2.8658 3.0043 $200,000 $220,000 $220,000 $200,000 $220,000 $220,000 $601 $630 $661 $29 $60 $250,000 $275,000 $275,000 $250,000 $275,000 $275,000 $751 $788 $826 $37 $75 ASSESSED VALUES $300,000 $309,000 $309,000 $300,000 $330,000 $330,000 TAXABLE VALUES $250,000 $259,000 $259,000 $300,000 $330,000 $330,000 TAXES $751 $742 $778 $901 $946 $991 CHANGE ($9) $27 $45 $90 23 Property Values and Millage: 5.0000 Millage Setting 16 Year History Rolled -Back 4 Years/Below 7 Years/Above 5 Years 4.5000 (At or Below Rolled -Back 68.8% of the Time) 4.0000 3.5000 3.0000 2.5000 2.0000 2007 2008 2009 19 Rolled-Backl 3.0519 3.212113364613 Final 13.0519 2.9917 13,3456 13 24 Other Considerations o Labor Agreements Not Yet Negotiated. o Adding Six Positions in General Fund. o Cutting Two Positions in Stormwater. o Prices Continue to Increase. o How Long Will Current High Revenue Levels Continue? o Setting Proposed Millage for the Trim Notices at 3.0043 Will Be Advertised as an 11.96% Tax Increase . 25