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Home My WebLink About09212004 BUDGET HEARINGHOME OF PELICAN ISLAND SEBASTIAN CITY COUNCIL AGENDA FY04/05 BUDGET HEARING TUESDAY, SEPTEMBER 21, 2004 - 6:00 P.M. CITY COUNCIL CHAMBERS 1225 MAIN STREET, SEBASTIAN, FLORIDA ALL AGENDA ITEMS MAY BE INSPECTED IN THE OFFICE OF THE CITY CLERK - 1225 MAIN STREET, SEBASTIAN, FLORIDA 1. CALL TO ORDER 2. PLEDGE OF ALLEGIANCE 3. ROLL CALL 4. 2nd READING AND ADOPTION HEARING MILLAGE AND FY 2004/2005 BUDGET ~.127 RESOLUTION NO. R-04-34 - Millage Rate for Calendar Year 2004 (Finance Transmittal 9/10/04, DR Certification of Taxable Value, R-04-34) A RESOLUTION OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, ADOPTING A MILLAGE RATE OF 4.5904 MILLS FOR THE CALENDAR YEAR 2004 AND ALLOCATING SAME TO THE FISCAL YEAR BEGINNING OCTOBER 1, 2004 AND ENDING SEPTEMBER 30, 2005; PROVIDING FOR CONFLICTS; AND PROVIDING FOR AN EFFECTIVE DATE. 04.127 5-12 RESOLUTION NO. R-04-35 - Fiscal Year 2004/2005 Budqet (Finance Transmittal 9/10/04, R-04-35, Schedule A) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, ADOPTING THE BUDGET FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2004 AND ENDING SEPTEMBER 30, 2005; MAKING APPROPRIATIONS FOR THE PAYMENT OF OPERATING EXPENSES, CAPITAL EXPENSES, AND FOR THE PRINCIPAL AND INTEREST PAYMENTS OF THE BOND AND OTHER INDEBTEDNESS OF THE CITY IN THE CITY'S GENERAL FUND, SPECIAL REVENUE FUNDS, DEBT SERVICE FUND, CAPITAL IMPROVEMENT FUNDS, GOLF COURSE FUND, AND AIRPORT FUND AS PROVIDED FOR IN SCHEDULE ATTACHED HERETO, ESTABLISHING AUTHORITY OF THE CITY MANAGER TO IMPLEMENT THE BUDGET; PROVIDING FOR SEVERABILITY; PROVIDING FOR CONFLICTS; AND PROVIDING FOR AN EFFECTIVE DATE. 04.127 13-23 RESOLUTION NO. R-O4-36 - Readoptinq Financial Policies (Finance Transmittal 9110/04, R-04-35, Policy) A RESOLUTION OF THE CITY OF SEBASTIAN, FLORIDA, RE. ADOPTING MODIFIED FINANCIAL POLICIES GOVERNING VARIOUS AREAS OF BUDGET AND FINANCE AS PROVIDED FOR IN ATTACHMENT 1; PROVIDING FOR CONFLICTS; AND PROVIDING FOR AN EFFECTIVE DATE. 5. ADJOURN if any person decides to appeal a decJsion with any respect to any matter considered at the above heedng or meeting, said person will need a verbatim rocord of all proceedings including the testimony and evidence, which is not provided by the Cily. (F.S. 286.0105) In compliance with the Americans with Disabilities Act (ADA), anyone who needs special accommodation for this meeting should contact the Cily's ADA coordinator at 58~-5330 at least 48 hours in advance of this meeting. Headng Assistance Headphones are Ava#able in the Council Chambers for all Govemmant Meetings. HOM~ OF PrqO~ ISLAND City of Sebastian, Florida Subject: Resolution No. R-04-34 Adoption of Millage Rate for Calendar Year 2004. Appt\v~~~' . ~ ,~/, Exhibits: } Resolution No. R-04-34 Agenda No. Department Orion,; Finance /d'-~_~ ~ City Attorney: ~" (~, 2_ -_ ' City Clerk: ~ Date Submitted: September 10, 2004 For Agenda of: September 21, 2004 Copy of DR 420 Certification of Taxable Value EXPENDITURE REQUIRED: N/A N/A~OUNT BUDGETED: APPROPRIATION REQUIRED: N/A SUNIMARY In accordance with Florida Statute 200.065 (7)(a.)(1.), a tentative millage tax rate for calendar year 2004 and for the budget year beginning October 1, 2004 and ending September 30, 2005, was approved by City Council on September 9, 2004. The proposed millage tax rate of FOUR POINT FIVE NINE ZERO FOUR (4.5904) MILLS is 13.16% greater than the "rolled-back" tax rate of 4.0565 mills and will provide sufficient operating revenue for the proposed budget for fiscal year 2004/2005. There have been no changes from the tentatively approved millage tax rate to the final millage rate presented to the Council tonight for final adoption. RECOMMENDED ACTION Move to adopt Resolution R-04-34 establishing the millage tax rate of 4.5904 mills for calendar year 2004. RESOLUTION NO. R-04-34 A RESOLUTION OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, ADOPTING A MILLAGE RATE OF 4.5904 MILLS FOR THE CALENDAR YEAR 2004 AND ALLOCATING SAME TO THE FISCAL YEAR BEGINNING OCTOBER 1, 2004 AND ENDING SEPTEMBER 30, 2005; PROVIDING FOR CONFLICTS; AND PROVIDING FOR AN EFFECTIVE DATE. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, that: Section 1. MII,LAGE RATE LEVY. There is hereby Levied an Ad Valorem Tax of FOUR POINT FIVE NINE ZERO FOUR (4.5904) MILLS against all real and tangible personal property for the calendar year (January 1, 2004 through December 31, 2004) and the resulting tax revenue is hereby appropriated for the General Operating Fund of the City of Sebastian for the fiscal year beginning October, 1, 2004 and ending September 30, 2005. Section 2. ROLLED-BACK RATE. The tax rate established in Section 1. is 13.16% higher than the computed "rolled-back" tax rate of 4.0565 mills. Section 3. CONFLICT. All resolutions or parts of resolutions in conflict herewith are hereby repealed. Section 4. EFFECTIVE DATE. immediately upon its adoption. This resolution shall take effect The foregoing Resolution was moved for adoption by Councilmember The motion was seconded by Councilmember into a vote, the vote was as follows: Mayor Nathan McCollum Vice-Mayor Joe Barczyk Councilmember Raymond Coniglio Councilmember Mike Heptinstall Councilmember Lisarme Monier and, upon being put The Mayor thereupon declared this Resolution duly passed and adopted this 21 st day of September 2004. CITY OF SEBASTIAN, FLORIDA By:. Nathan MeCollum, Mayor ATTEST: Sally A. Maio, CMC City Clerk Approved as to form and legality for the reliance by the City of Sebastian only: Rich Stringer, City Attorney CERTIFICATION OF TAXABLE VALUE SECTION J 2004 Year indian River County To: ar Taxable Value of Real Preperty for Operatin9 Pumosea Current Year Taxable Value of Personal Preoart¥ for OperatinB Purposes Current Year Taxable Value of Centrally Assessed Property for Operatin~ Purposes Current Year Gross Taxable Value for Operatin9 Purposes (1! * (2/ + (3) = (4) Current Year Net New Taxable Value (New Construction + Additions + RehaPilitative improvements increasing Assessed Value At Least 100% + Annexations - Deletions) DR-420 CITY OF SEBASTIAN (Name of Taxing Authority} Current Year Adjusted Taxable Value (4) - (5) = !6) Prior Year FINAL Gross Taxable Value 3iication Form DR-403 Series) 802,074,405 44,120,673 896.256 847,091,334 49,499,394 797,591,940 7O4,823,724 I do hereby certify the values shown herein to be correct to the best of my knowledge and belief. Witness my hand and official signature at Vero Beach , Florida, This 25th day of fMonth, andYeer) June ,2004 Signature of Pr6perty Appraiser TAXING AUTHORITY: If this portion of the form is not corepleted in FULL your Authority Will be denied TRIM certification and possibly lose its millage levy privilege for the tax year. If any line is Inapplicable, enter NJA or SECTION II 81Prior Year Operetin~ Milta,ge Lev~ I $ 4.5904 Iper$1,000 8 9 Prior Year Ad Valorem Proceeds (7) × (8)~ $ 3 r 235 ~ 423 9 lO!Current Year Rolled-Back Rate (9)/(6) j $ ~t. 0565 per $1,008 10 11 Current Year Proposed Operating Millage Rate t $ 4 5904 parS1,000111 12 Check TYPE of Taxing Authority: Count~ Dependent District Municipal Service Taxing Unit 12 X Municipality Independent Special District Multi-County Water Management District 13JIF DEPENDENT SPECIAL DISTRICT OR MSTU IS MARKED, PLEASE SEE REVERSE SIDE. I13 14 Current Year Milieus Lev)/for VOTED DEBT SERVICE ~ 0 per $1,000 14 18 Current Year Millage Lev~/for OTHER VOTED MILLAGE 0 Der $1,000 15 DEPENDENT SPECIAL DISTRICTS SKIP lines (16) through (22) I 16 Enter Total Prior Year Ad Valorem Proceeds of ALL DEPENDENT Special Districts $ 116 & MSTU's levying a millage. (The sum of Line (9) from each District's Form DR-420) 0 17 Total Prior Year Proceeds: (9) + (16) $ 3 ~ 2 3 5 r 42 3 17 18 The Current Year A!~re~ate Rolled-back Rate (17) / f6) $ 4,0565 )er $1,000 18 19 Current Year A~gregate R°lled'back Taxes: (4) x (18) $[ 3, ,f:~6r 225 19 26 Enter Total of all non-voted Ad Valorem Taxes proposed to be levied by the Principal $ 3 r 8 8 8 · 4 8 8 20 Taxing Authority, all Dependent Districts, & MSTU's if any, Line (11) x Line (4) 21 Current Year Proposed A~¢re~ate Millage Rate: (20) / (4) $ 4.5 9 0 4 Der $1,008 21 22 Current Year Proposed Rate as a PERCENT CHANGE of Rolled-back Rate: 1 3.1 6 [(Line 21 / Line 18). %00) x 100 i % s gnature at.. S~as~ Florida, this the 2 8th Signature an'b'~'itie df'~hief AOministrative Officer 1225 Main Street Date, Time and Place of the First Public Budget Hearing: ~hursday, Septem.ber 9, 2 0 0 4, 6: 0 0 P. M. City Council Chambersr Sebastian City Hall, 1225 Main Street, Sebastian,' FL 3295 I do hereby certify the reillages and rates showp herein to be correct to the best of my knowledge and belief, FURTHER, I certify that all mlllages comply with the provisions of Section 200.071 or 200.081, F.S. WITNESS my hand and official day of fMonth, and Year) July, 2 0 0 4 1225 Main Street, Sebastian,FL 329. Address of Physical Location Shai Prancis Mailing Address Name of Contact Person SeBastian, FL 32958 (772) 388-8205 City / . I ~ State Zip Phone# Fax# See Instructions on Reverse Side CiW of Sebastian, Florida Subject: Resolution R-04-35 Adoption of a Budget for Fiscal Year 2004/2005 Appr anager Agenda No. Department OrigitglFinance .g~', -~.., City Attorney: ~'~-r-w - City Clerk: ~ .4qA Date Submitted: September 10, 2004 For Agenda of: September 21, 2004 Exhibits: · Resolution R-04-35 · Schedule "A" EXPENDITURE N/A~OUNT BLrDGETED: REQUIRED: N/A APPROPRIATION REQUIRED: N/A SUMMARY In accordance with Florida Statute 200.065, a tentative budget for fiscal year 2004/2005, beginn'mg October 1, 2004 and ending September 30, 2005, was approved by City Council on September 9, 2004. There have been no changes from the tentatively approved budget to the final budget presented to the Council tonight for final adoption. RECOMMENDED ACTION Move to adopt Resolution R-04-35 establishing the budget for fiscal year 2004/2005. RESOLUTION NO. R-04-35 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA ADOPTING THE BUDGET FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2004 AND ENDING SEPTEMBER 30, 2005; MAKING APPROPRIATIONS FOR THE PAYMENT OF OPERATING EXPENSES, CAPITAL EXPENSES, AND FOR TFfE PRINCIPAL AND INTEREST PAYMENTS ON THE BOND AND OTI~R INDEBTEDNESS OF THE CITY IN THE CITY'S GENERAL FUND, SPECIAL REVENUE FUNDS, DEBT SERVICE FUND, CAPITAL IMPROVEMENT FUNDS, GOLF COURSE FUND, AND AIRPORT FUND AS PROVIDED FOR IN SCHEDULE "A,, ATTACI:IED HERETO, ESTABLISHING AUTHORITY OF THE CITY MANAGER TO IMPLEMENT THE BUDGET; PROVIDING FOR SEVERABILITY; PROVIDING FOR CONFLICTS; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Manager has submitted a Proposed Budget for the City of Sebastian for the fiscal year beginning October 1, 2004, and ending September 30, 2005; and WHEREAS, on September 9, and September 21, 2004, the City Council conducted Public Hearings on the Proposed Budget. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, that: Section 1. The City Manager's Proposed Budget is hereby adopted for the Fiscal Year beginning October 1, 2004 and ending September 30, 2005. Section 2. The amounts shown on the attached Schedule "A" are hereby appropriated out of the Treasury of the City, including any revenues accruing to the City available for purposes of the City's budgetary accounts. Section 3. The City Manager is hereby authorized and directed to proceed with the implementation of the service programs and projects provided for in the budget. Such implementation is to be consistent with the provisions of the City Code of Ordinances and policies established by the City Council. Section 4. The City Manager is authorized to make budget adjustments within budgetary accounts, as he deems appropriate. He is further authorized to make budget djustments between budgetary accounts when necessary to implement programs, projects, and expenditures authorized by the City Council. All other budgetary adjustments will require prior approval by the City Council. Section 5. If any clause, section, or other parts of this Resolution shall be held by any Court of competent jurisdiction to be unconstitutional or invalid, such unconstitutional or invalid part shall be considered as eliminated and shall in no way affect the validity of the other provisions of this Resolution. Section 6. All Resolutions or parts of Resolutions in conflict herewith are hereby repealed to the extent of such conflict. Section 7. This Resolution shall become effective October 1, 2004. The foregoing Resolution was moved for adoption by Councilmember The motion was seconded by Councilmember and, upon being put into a vote, the vote was as follows: Mayor Nathan McCollum Vice-Mayor Joe Barczyk Councilmember Raymond Coniglio Councilmember Mike Heptinstall Councilmember Lisanne Monier The Mayor thereupon declared this Resolution duly passed and adopted this 21st day of September, 2004 CITY OF SEBASTIAN, FLORIDA ATTEST: By: Nathan McCollum, Mayor Sally A. Maio, CMC City Clerk Approved as to form and legality for the reliance by the City of Sebastian only: Rich Stringer, City Attorney ATTACHMENT TO RESOLUTION R-04-35 SCHEDULE "A" BUDGET SUMMARY FISCAL YEAR 2004/2005 REVENUES: 001501 001501 001501 001501 001501 001501 001501 001501 Licenses and permits Intergovernmental Charges for services Fines and forfeits Miscellaneous Transfers in Casli balance carryforward Total Revenues EXPENDITURES: 010001 010005 010009 010010 010020 010021 010035 010040 010041 010042 010043 010044 010045 010046 010047 010048 010049 010051 010053 010052 010054 010057 010059 010080 010085 010099 City Council City Manager City Clerk City Attorney Finance Management Information System Human Resources Police Special Operations Police Adm/afislrafion Police School Resource Police Pa~ol Divis{on Community Policing umt Code Enforcement Division Professional Standards Police Detective Division Police Support Services Police Dispatcli Unit Engineering Stormwater Utility Roads and Maintenance Garage Parks and Recreation Cemetery Growth Maaagement Building Department Nos-departmental Total Expenditares 6,567,843 1,317,494 1,929,834 I74,937 118,615 168,591 527,828 316,I25 11,121,267 $ 42,278 371,971 307,776 176,469 369,600 135,307 209,884 283,878 305,090 164,889 1,737,847 144,347 115,611 92,959 466,464 275,753 422,701 482,750 1,044,205 1,026,990 192,488 936,369 143,390 256,829 561,825 853,597 $ 11,121,267 ATTACHMENT TO RESOLUTION R-04-35 SCHEDULE "A" BUDGET SUMMARY FISCAL YEAR 2004/2005 SPECIAL REVENUE FUNDS 106010 COMMUNITY DEVELOPNIENT BLOCK GRANT FUND REVENUES CDBG Grant Total Revenues 106051 EXPENDITURES Operating Transfers out Total Expenditures LOCAL OPTION GAS TAX FUND 120010 REVENUES Taxes Miscellaneous Total Revenues 120051 EXPENDITURES Operaffug Debt service Transfers out Non-operating Total Expenditures DISCRETIONARY SALES TAX FUND 130010 REVENUES Taxes Miscellaneous Total Revenues 130051 EXPENDITURES Transfers out Non-operating Total Expenditures RECREATION IMPACT FEE FUND 160010 REVENUES Impact fee Miscellaneous Total Revenues 160051 EXPENDITURES Transfers om Non-operating Total Expenditures $ 685,000 $ 685,000 $ 41,000 644,000 $ 685,000 $ 750,000 12,000 $ 762,000 $ 208,129 300,000 240,000 13,871 $ 762,000 $ 2,250,000 15,000 $ 2,265,000 $ 2,027,596 237,404 $ 2,265,000 $ 360,000 4,500 $ 364,500 $ 349,000 15,500 $ 364,50~ ATTACHMENT TO RESOLUTION R-04-35 S CItEDULE "A" BUDGET SUMMARY FISCAL YEAR 2004/2005 SPECIAL REVENUE FUNDS - CONTIiNUED STORMWATER UTILITY FLr~ 163010 REVENUES Stormwater utility fee Miscellaneous Total Revenues 163051 EXPENDITLrRES Operat~g Transfers out Non-operating Total Expenditures 190010 LAW ENFORCEMENT FORFEITURE FUND REVENUES Fines and forfeits Miscellaneous Total Revenues 190051 EXPENDITURES Operating Total Expenditures DEBT SERVICE FUNDS 230010 DISCRETIONARY SALES SURTAX REVENUE BONDS REVENUES Miscellaneous Transfers in Total Revenues 230051 EXPENDITURES Operating Debt service Total Expenditures 263010 STORMWATER UTILITY REVENUE BONDS REVENUES Miscellaneous Transfers in Total Revenues 263051 EXPENDITURES Debt service Total Expenditures 804,980 27,000 $ 831,980 $ 3,500 745,458 83,022 $ 831,980 5,000 5,000 $ 10,000 $ 10,000 $ 10,000 3,000 1,030,844 $ 1,033,844 $ 300 $ 1,033,544 $ 1,033,844 301 441,672 $ 441,973 $ 441,973 $ 441,973 ATTACItMENT TO RESOLUTION R-04-35 SCItEDULE "A" BUDGET SUMMARY FISCAL YEAR 2004/2005 CAPITAL PROJECTS FUNDS REVENUES Transfer from Local Option Gas Tax Fund Transfer from Discret/onary Sales Tax fund Transfer from Recreation Impact Fee Fund Transfer from Stormwater Utihty Fund Transfer from Airport Fund Transfer from Community Development Block Grant Fund Grants and other sources Total Revanues EXPEI~ITURES Roads projects Recreation facilities projects Stormwater utility projects Airport projects Public safety projects Debt service Total Expenditures GOLF COURSE FLrND 410010 REVENUES: Charges for services Miscellaneous revenues Cash balance carryforward Total Revenues 410110 EXPENSES: GOLF COLrRSE ADMIlh~ISTRATION Personal services Operating expenses Debt service Total Admini~afion 410120 GOLF COURSE GREEN DMSION Operating expenses Capital outlay Contmgancy Total Golf Course Green Division 410130 GOLF COURSE CARTS DMSION Personal services Operating expenses Total Golf Course Carts Division Total Golf Course Expenses 240,000 651,193 349, O0O 142,790 3,75O 644,000 352,790 $ 2,383,523 1,194,000 389,000 185,580 420,250 40,000 $ 154,693 2,383,523 1,516,674 14,000 23,940 1,554,614 299,181 271,056 306,690 876,927 533,572 20,800 14,094 568,466 55,271 53,950 109,221 $ 1,554,614 ATTACHMENT TO RESOLUTION R-04-35 SCHEDULE "A" BUDGET SUMMARY FISCAL YEAR 2004/2005 AIRPORT FUND 450010 REVENUES Charges for services Miscellaneous revenues Total Revenues 450110 EXPENSES: PersonaI sexvices Operating expenses Transfers to capital projects fund Contingency Total Expenses TOTAL BUDGET SUMMARY GENERAL FU1YD SPECIAL REVENUE FU1NDS DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS ENTERPRISE FUNDS TOTAL BUDGET FOR ALL FUNDS $ 267,235 8,020 $ 275,255 $ 142,109 92,064 3,750 37,332 $ 275,255 $ 11,121,267 4,918,480 1,475,817 2,383,523 1,829,869 $ 21,728,956 City of Sebastian, Florida Subject: Resolution No. R-04-36 Readopling Financial Policies Agenda No. Department Orig,: F/nance~~L~-~ City Attorney: ~'~L <'~ ,~ ~ 3ity Clerk: ~ Date Submitted: September 10, 2004 For Agenda of: September 21, 2004 Exhibits: · Resolution R-04-36 Readopting Financial Policies Governing Various Areas of Budget and Fiuanc~ · Attachment 1 - Financial Policies EXPENDITURE REQUIRED: AMOUNT BUDGETED: N/A APPROPRIATION REQLrltLED: N/A N/A SUMMARY Pursuant to City of Sebastian Resolution 03-23 Section H, the financial policy shall be readopted annually as part of the annual budget adoption process. The major revisions of the financial policy include the following: Overall goals of the financial policy have been added. Operating budget policies including the budget process and budget amendment process have been added. A summary of reserve and contingency requirements for the General Fund has been added. A reserve policy has been established for the Stormwater utility Revenue Fund. This revised financial policy (Attachment "A") reflects necessary changes to be in line with current operation. RECOMMlgNDED ACTION Move to adopt Resolution R-04-36. RESOLUTION NO. R-04-36 A RESOLUTION OF THE CITY OF SEBASTIAN, FLORIDA, READOPTING MODIFIED FINANCIAL POLICIES GOVERNING VARIOUS AREAS OF BUDGET AND FINANCE AS PROVIDED FOR IN ATTACHMENT 1; PROVIDING FOR CONFLICTS; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the Government Finance Officers Association of the United States and Canada recommends best practices in various areas for Finance and Budget; and WHEREAS, the City Council deems it to be necessary to adopt and readopt such financial policies on an annual basis, NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEBASTIAN, FLORIDA, as follows: SECTION 1. REAl)OPTING FINANCIAL POLICIES: The City Council of the City of Sebastian hereby readopts the attached modified Financial Policies governing the Operating Budget, Financial Reserves, Use of Surplus, Performance Measurement, Capital Improvement Program, Debt Management, Revenue, and Investment. SECTION 2. All resolutions or parts of resolutions in conflict herewith are hereby repealed. SECTION 3. This Resolution shall take effect upon adoption. The foregoing Resolution was moved for adoption by Council Member Motion was seconded by Council Member and, upon being put to a vote, the vote was as follows: Mayor Nathan McCollum Vice-Mayor Joe Barczyk Councilmember Raymond Conigho Councilmember Mike Heptinstall Councilmember Lisanne Monier The Mayor thereupon declared this Resolution duly passed and adopted this 22nd day of September, 2004. CITY OF SEBASTIAN, FLORIDA ATTEST: By: Nathan B. McCollum, Mayor Sally A. Maio, CMC City Clerk Approved as to Form and Legality for Reliance by the City of Sebastian Only: By: Rich Stringer, City Attorney City of Sebastian Financial Policies City of Sebastian's financial policies set forth the basic framework for overall fiscal plannin~ and management and set forth guidelines for both current activities and long-range planning. These policies are reviewed aunuallv to assure the highest standards of fiscal management. The City Manager and the Management Team has the pr/mary role of reviewinq financial actions and providing guidance on financial issues to the Cit~ Council. Overall goals The overall fmancial goals underlying these policies al?er 1. Fiscal Conservatism: To ensure that the city is in a solid financial condition at all times. This can be defined as: A. Cash Solvency- the ability to pa,/bills B. Budgetary Solvency - the abiht'v to balance the budget C. Long Term Solvency - the abihty to pay future costs D. Service Level Solvency - the ability to provide needed and desired services Flexibility: To ensure that the city is in a position to respond to changes in the economy or new service challenges without an undue amount of financial stress. Comply with All Statutory Requirements: As set forth by the State of Florida and the City ordinances. Adherence to the highest Accounting and Management Practices: As set by the Government Finance Officers' Association standards for financial reporting and budgeting, the Government Accounting Standards Board and other professional standards. Operating Budget Policies The Finance Department, with support and direction from the Office of the Citw Manager, coordinates the budget process. The formal budgeting process, which (begins in February and ends in September, provides the primatw mechanism by which kev decisions are made regarding the levels and types of services to be provided, given the anticipated level of available resources. Revenues and expenditures are proiected on the basis of information provided by ciW departments, outside agencies, current rate structures, b/storical data and statistical trends. Budget Process The development of the budget is guided by the following budget policies: 1. The budget must be balanced for all funds. Total anticipated revenues must equal total estimated expenditures for each fund (Section 166.241 of Flor/da Statutes requires that all budgets be balanced). All operating funds are subiect to the annual budget process and reflected hi the budget document. The enterprise operations of the city are to be self- supporting: i.e., current revenues will cover current expenditures, including debt serv/ce. 4. An admmistr~ive so, ice fee will be assessed by the General Fund against all enterprise funds of the city. This assessment will be calculated based upon a percentage (number of full-time equivalent employees of the enter0rise fund/total number of full-time equivalent employees of the city) of total General Fund administration expenditures budget (includes City Council, City Manager, City Attorney, City Cleric Fhiance, and Human Resources) and will be used to reimburse the General Fund for the administrative and support services provided to these funds. 5. A 2.5 percent administrative service fee will be assessed by the General Fund against the Community Redevelopment Agency (CRA) Fund of the city. This assessment will be based on the total tax increment revenue estimate of the CRA Fund and will be used to reimburse the General Fund for the administrative support services provided to the CRA fund. 6. An administrative service fee will be assessed by the General Fund against Stormwater Utility Revenue Fund. The assessment will be calculated based on the maximum allowable percentage set forth by the city's Stormwater Ordinance. Pursuant to the City Ordinance No. O-04-15. no more than 20% of the annual net stormwater fee Date: 9/16/2004 1 City of Sebastian Financial Policies revenues is to be used for the operation and maintenance of the stormwater program. In no event will the City of Sebastian lev,? ad valorem taxes against real property and tangible personal property in excess of 10 mills, except for voted levies (Section 200.081 of Florida Statutes places this millage limitation on all Florida municipalities.) The city will budget 95 percent of anticipated gross ad valorem proceeds to provide an allowance for discounts for early payment of taxes (Section 200.065 of Florida Statutes states that each taxing authority shall utilize not less than 95 percent of the taxable value.) 9. The city will coordinate development of the capital improvement budget with the development of the annual operating budget. Each capital improvement budget is reviewed for its impact on the operating budget in terms of revenue generation, additional personnel required and additional operating expenses, 10. A budget calendar will be designed each year to provide a framework within which the interactions necessary to formulate a sound budget could occur. At the same time, it will ensure that the city will comply with all applicable State legal mandates. Accounting Basis The General, Special Revenue, and Debt Service Funds shall be prepared on a modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized only when they become measurable and available to finance expenditures of the fiscal period. Expenditures are recogni?ed when the fund liability is incurred except for unmatured interest on general long-term debt which is recognized when due, and the non-current portion of accrued fringe benefits (vacation and sick leave) which is recorded as a long-term liability in the Statement of Net Assets In the Comprehensive Annual Financial Report. The budgets for the Proprietary funds - Golf Course and Airport - are prepared using the accrual basis of accounting. Under the accrual basis of accounting, expenditures are recognized when the liability is incurred. Revenues are recognized when they are obligated to the City (e.g., Airport leases). The differences between the budget basis and the accrual basis of accounting include: (1) budgeting the full amount of capital expenditures as expense rather than depreciating them and (2) presenting debt service, including principal as an expense. Guidelines The Comprehensive Annual Financial Report (CAFR) presents the status of the City's finances on a basis consistent with Generally Accepted Accounting Principles (GAAP) (i.e., a statement of net assets and statement of activities are presented on an accrual basis of accounting, including governmental funds, major governmental and proprietary funds are identified, governmental funds use the modified accrual basis of accounting, while the proprietary and trust funds use the accrual basis of accounting.) In order to provide a meaningful comparison of actual results to the fmaI budget, the CAFR presents the City's operations on a GAAP basis and also shows fund revenue and expenditures on a budget basis for the General, Special Revenue, and Debt Service funds. Current revenues shall be sufficient to support current expenditures. The budget process and format shall be performance- based and focused on goals, objectives, programs, and performance indicators. The budget will provide adequate funding for maintenance and replacament of capital plant and equipment. bud~ .............. c::p:nz: acti;53' for all The City sh.- rna ..... tm:.: ........ Budget Amendment 1. Total fund appropriations changes must be approved by the City Council. 2. Uses of contingency appropriations must specifically approved by the City Council. 3. Shifts in appropriations within fund totals may be done administratively on the authority of the City manager. In most cases the City Manager will Date: 9/16/2004 2 City of Sebastian Financial Policies request City Council's approval since the item prompting the change will usuail¥ go to the City Council (e.g., award of contract, addition of staff, contract change order). Procedures for appropriation transfers and delegation of budget responsibility will be set by the City manager. A Budgetary Control System will be rr~mt~med to ensure compliance with the budget. Quarterly budget status reports will be provided to the City Council comparing actual versus budgeted revenue and expense activity for all budgeted funds. Planning The City will annually prepare and distribute to departments and the City Council a Five-Year Forecast. The forecast will include estimated operating costs and revenues for futare capital improvements, such as new parks and public works facilities, included in the capital budget. Fund Balance Policies) On an annual basis, after the year-end audit has been completed, but no later than April I, the City Finance Director shall produce a schedule of all fund surpluses and deficits, with projections of reserve reqff~rements and a plan for the use of any excess surplus for the current year in accordance with the Financial Balance Policies and Use of Surplus Policies. This document will be used not only to ensure compliance with stated and adopted policies, but also to analyze the total reserve and surplus pieture to ensure that the policies as adopted do not inadvertently create adverse effects. The Director of Finance shall provide recommended changes to the City Council for any changes to the Financial Balance Policies and Use of Surplus Policies based on needs identified in this analysis. Working Capital The General Fund unappropriated fund balance will be m~mtained in an amount greater than or equal to fifteen percent (15%) of the annual General Fund Expenditures budget. This amount approximates two months or 60 days of working capital. The City shall include in the General Fund operating budget annually, an Operating Contingency Account equal to 1.5% of the General Fund total expenditures, less debt service, inteffund transfers and capital expenditures. Tiffs contingency will be used for unforeseen and emergency events that occur during the course of the operating year and will expire at the end of each fiscal year and balances will not be brought forward. In order to provide the resources necessary to ensure continued operations of the City's programs should a natural disaster or significant changes m the weather pattern occur, the City shall maintain a reserve of $350,000 for emergency services. The City shall maint/m a reserve of $100,000 for Property and Casualty claims representing four claims on a $25,000 deductible. All retirement programs, Police Pension, CWAflTU and 40la programs will be funded at 100% of the obligations calculated annually. The defined benefit pension plan will be funded in accordance with an independent actuarial analysis performed at a minimum of every two years, or as needed. Capital Reserves The City shall include in the General Fund operating budget annually a Capital Contingency Account equal to 0.5% of the General Fund total expenditures, less debt service, inteffund transfers and capital expenditures. This contingency will be used for unanticipated expenditures for the maintenance of buildings and replacement of related equipment and will expire at the end of each fiscal year and balances will not be brought forward. Annually the City shall transfer fifty percent (50%) of the current year's operating surplus (revenues in excess of expenditures) into a capital equipment replacement reserve for the purpose of creating a perpetual funding method for replacing City capital equipment. Prior to any funds being ~ngf:.~c~, a d ........... ~v-~v .............. ~ ........... spent, the budget amendment procedure must be followed. Date: 9/16/2004 3 City of Sebastian Financial Policies The City shall maintain a reserve of $1,000,000 for the purpose of providing advances to the airport for capital improvements pursuant to a resolution establishing this loan reserve. The table listed blow is a summary of all reserve and contingency requirements for the General Fund. Reserve Description Requirement Worlcin~ Canital Reserve 15% ofaunual General Fund Expenditures budget Emereancv Reserve $350.000 Property and Casualty claims $100,000 Reserve Cat~ital Eauitmaent Renlacemant50% of the current year's Reserve operating sumlus (revenues in excess of expenditures) General Fund Advance to $1.000,000, expke September Aireort Canital Projects Reserve 12. 2007 General Fund Ooerating 1.5% of the General Fund Contineeunv (for budect rmrposetotal exuenditunes budget, less only) debt service, inteffund txansfers and capital expenditures Caoita] Contingency (for budget0.5% of the G~neral Fund nureose only) total exvenditures budget, less debt service, interfund Iransfers and cavital expenditures All retirement nro~yams 100% Funded per indenendant actuarial analysis oerformed at a ralnimum of every two years, or as needed Use of Surplus Policies Use of Surpluses It is the intent of the City to use all surpluses generated to accomplish three goals: meeting reserve policies, avoidance of future debt, and reduction of outstanding debt. The City will not use existing fund balances or year-end surpluses to fund ongoing operating expenses. Any surpluses realized in the General Fund at year- end shall be used first to meet reserve policies as set forth in the Fund Balance Policies. Excess surplus will then be used for the following purposes, listed in order of priority: )~ Capital Replacement Programs. After General 0 Fund reserves have been met, up to 50 ~ of excess reserves may be set aside to provide the cash necessary to implement capital replacement programs (e.g., vehicle and equipment replacement and facility maintenance programs). s~lus r~a~ng a~er res~e policies ~ve met ~y be used to pay dom debt ems~g in g~al ~d or my o~ capi~l lo~. Cash Pa~en~ f~ Capi~l ~provement ~ojee~. Using cash to p~c~se capitol ite~ · at ~e budgeted to be p~c~ed wi~ the proceeds ~om ~y debt ~11 reduce ~e ~e debt b~d~ of ~e CiW. ~is s~ate~ ~y be comb~ed ~ re~ement to reduce ~e debt se~ce a~ peffomg a fm~ai~ ~alysis detmne the ~eatest net ~esmt value suings. > Cmet~ Pemnent Trust Fred. ~er ~1 o~er needs ~ve be~ satisfied, excess s~luses my be ~msf~ed to ~e Cmet~ Pment Trust F~d that Ms ~en emblished to c~e for the Cemete~. The amo~ ~f~ed shall be deemed c~us to ~e Cmete~ Trust ~d for ~e eamm~ ~o~h m ~d Cemete~ c~e ~d mmt~ance. } ~vcr~t Redevelopment Agmcy. ~er all o~ nee~ ~ve be~ sahsfied; ~cess s~l~es ~y be ~ansf~ed m ~e ~ve~ont Redevelopment Agency ~t has be~ es~blished to pro,de in,ashore ~d public faciliw needs. Special Revenue ~nd Su~luses Loc~ Option Gas T~ Revenue Fund - A rescue ~11 be ~inmined in ~ amour ~eater ~ or equal to fiheen p~cent (15%) of ~e ~u~ Local Gas T~ Fred Expendi~es budget. Excess s~luses s~ll f~st be used for ~e p~ose of reducing debt for · e Road Pamng Note Payable. Discretionary Sales Surtax Revenue Fund - A reserve will be maintained in an amount greater than or equal to ten percent (10%) of the total annual Discrehunary Sales Tax Fund Expenditures budget for the purpose of providing sufficient funds for unanticipated major repairs or replacements for eligible capital improwments or equipment. Discretionary Sales Tax revenues will be used in accordance with the following: i. fund annual debt service payments for which this revenue source is pledged, then; ~ 2. fund emergency vehicles, then; [ 3. fund pay-as-you go eligible capital improvemen0g, ' ' ~ Date: 9/16/2004 4 City of Sebastian Financial Policies 4. fund equipment for the maintenance of Discretionary Sales Tax funded improvements. Stormwater Utility Revenue Fund - A reserve will be maintained in an amount greater than or e0ual to fifteen percent (15%) of the total annual Stormwater Utility Revenue Fund Expenditures budget for the purpose of provicYmg sufficient funds for unanticipated maior capital improvement program. (Pursuant to City of Sebastian Ordinance No. 0-04- 15, capital improvement program of the Comprehensive Growth Management Plan on furtherance of the Stormwater Master Plan adopted by the City Council.) Performance Measurement Policies Establishing Performance Requirements Every ~vo years, the City shall update the existing Strategic Plan that identifies Strategic Priorities for the following two years. Each Strateg/c Priority should provide three to five Key Intended Outcomes (KIOs) that measure appropriate results for each priority. Annually, each department shall develop departmental performance measures that correspond with the department programs and file them with the City Manger's Office. Goals should be related to core services of the department and should reflect stakeholder needs. The measures should be of a mix of different types, including effectiveness, efficiency, demand and workload. Measures should have sufficiently aggressive "stretch" goals to ensure continuous improvement. Workload - Measures the quantity of activity for a department (e.g., number of calls responded to). Demand - Measures the amount of service opportunities (e.g.. total number of calls). Efficiency - Measures the relationship between output and service cost (e.g., average cost of the response to a service call). ~ Effectiveness - Measures the impact of an activity (e.g., percent of people who feel safe). epartment Directors shall establish performance measures for each program w/thin their department to monitor and project program performance. These objectives must be linked to the departmental measures they support. Supervisors shall insure that fair, objective and aggressive performance measures for each employee that directly supports program objectives and departmental measures are part of their annual review. Reporting Performance Quarterly summanes of progress on goals and objectives and departmental performance measures will be provided to the City Manager fur publishing in the Council's Quarterly Budget to Actual Report. ami Decision Making and Analysis The City's Strategic Planning and budgeting decisions are based on a number of processes currently in place. The specific tools used are: · ~. Citizen Advisory Boards - (e.g., Budget Review Committee) are teams made up of Res/dents and City staff to address specific concerns and provide direction and feedback. Several such advisory boards currently exist; · ~. Master Planning - Specific functions and processes are included in written plans, such as the Comprehensive Plan, Stormwater Master Plan, and the Airport Master Plan; · ~. Fiscal Impact Model - Allocation methodology that quantifies average and marginal revenues and the costs of new development by land use type; · ~. Revenue Forecasting Model - Statistical time series analysis and tracking model of major revenue sources; · I. Performance Measurement System - Quarterly performance evaluations and reports; · ~* Capital Budgeting Tools - Present Value Payback, Net Present Value Analysis, Own/Lease Analysis, and Remm on investment (ROI) Analysis; · :. Five-YearFinancialPlan-Mulfi-yearforecasting of revenues and expenditures; Ten-Year Fleet Replacement Program - Equipment replacement covering the useful hfe of all vehicle classes; Tem Year Equipment and Maintenance Program - maintenance and replacement schedule coveting the useful life of all equipment, other than vehicles; Financial Trend Monitoring System - Systematic analysis of major financial indicators; Date: 9/16/2004 5 City of Sebastian Financial Policies Capital Improvement Program Policies Alignment The City shall coordinate the development of the Capital Improvement Program budget with the development of the Strategic Plan and Operating Budget, as well as ensuring compliance with the Comprehensive Plan Capital Improvement Element. Future operating expenditures and revenues associated with new capital improvements will be projected and included in the operating budget Five-Year Forecasts. Project Selection All capital projects submitted for approval must be justified in terms of how the project supports the achievement of the City's Strategic Priorities. Projects are prior/t/zed and approved based on the relevancy of the project to the City's Strategic Plan and the impact on the end stakeholder(s). Capital Improvement Budget The City shall adopt an annual Capital Budget based on the Capital Improvement Program. Future capital improvement expenditures necessitated by changes in population, real estate development, or in economic base will be calculated and included in the capital flrrprovc~ment budget projections. The or/ginating department of the capital improvement project will identify the estimated costs and funding sources for each capital project proposal before it is submitted to the City Council for approval. The City shall make all capital improvements in accordance with an adopted Capital Improvement Program budget. The City will determine and use the most prudent financial methods for acquisition of capital improvement projects based upon market conditions at the time of acquisition. Capital Equipment Outlay The City will determine and use the most prudent financial methods for acquisit/~n of new or replacement capital equipment, based upon market conditions at the time of acquisition. Capital Replacement Programs - The City shall establish equipment replacement and maintenance needs for at least a ten-year period and will update this projection each year. From this projection, a maintenance and replacement schedule shall be developed and implemented. FuncYmg for these programs will be made through funded depreciation charges to using departments and held in sinking funds created for the purpose of paying for replacements. Additional funding may be obtained through year-end surpluses as identified in the Use of Surplus Policies. Maintenance programs shall be paid for on a pay-as-you-go program. Maintenance The City shall n~mtain ali capital assets at a level adequate to protect the City's capital investment to minimize future maintenance and replacement costs. Physical Inventory An annual physical inventory (see Fixed Asset Policies) will be conducted to ensure that the replacement, maintenance, and Capital Improvement Program projections are accurate, and that sufficient internal control over capital items is exercised. See Fixed Asset Policies for further information on capital purchases. Debt Management Policies Market Review The City, in conjunction with its financial Consultant, shall review its outstanding debt annually for the purpose of determming if the fmaneial marketplace will afford the City the opportunity to refund an issue and incur less debt service costs. In order to consider the possible refunding of an issue, a Present Value savings of three percent (3%) over the life of the respective issue, at a minimum, must be attainable. Debt Issuance When the City finances capital projects by issuing bonds, it shall amortize the debt over a term not to exceed the average useful life of the project(s) financed. If General Obligation Bonds are issued, the City's goal will be to limit the maturity to fifteen (15) years. Capital Improvements, equipment and facility projects shall be classified into "pay-as-you-go" and "debt £mancing" classifications. Pay-as-you-go capital items will be $150,000 or less with lives often years or less or replacement of existing equipment wher~ depreciation has been paid to a sinking fund. Del~t fmancing will only be used for major, non-recurrin~,~ items with a minimum often (10) years useful life. ~'~ Date: 9/16/2004 6 City of Sebastian Financial Policies The City shall confme long-term borrowing to capital improvements and projects that have useful lives in excess of twenty (20) years. When possible, the City shall use a special assessment or self-supporting financing instead of general obligation bonds, so those benefiting from the improvements will bear all or part of the cost of the project financed. Debt Service Levels Annual General Fund debt service expense, if any, will be limited to eight percent (8%) of the General Fund expenditures budget. The City will limit its total outstanding General Obligation debt, if any, to five percent (5%) of the assessed valuation of taxable property. The City will 1/mit the mount of Variable Rate debt to fifteen percent (15%) of the total debt outstanding. Bond Ratings The City, along with its Financial Advisor, shall periodically review possible actions to maintain or improve its bond ratings by various rating agencies. The City shall maintain good communications with bond rating agencies and its bond insurers about its financial condition. The City shall follow a policy of "full disclosure" in its Comprehensive Annual Financial Report and bond prospectuses. Revenue Policies Revenue Projections The City shall estimate its annual revenues by objective and analytical processes. The City shall maintain a diversified and stable revenue system to the extent provided by law to insulate it from short-term fluctuations in any one- revenue source. User Fees The City shall recalculate on a bi-annual basis the full cost of selected activities currently supported by user fees and charges to identify the impact of inflation and other cost increases. The City shall set fees and user charges for the Golf Course fund at a level that fully supports the total direct and indirect costs of operation, including depreciation. Reporting and Analysis To ensure compliance with Revenue Policies, Fund Balance Policies, and Budget Policies, the City Finance Department shall prepare reports and analyses annually to monitor, project, and estimate revenue and expenditures, to wit: Five-Year Forecast of Revenues and Expenditures - A plaurfing tool prepared and used by the Finance Department to forecast and project various funds (General, Local Option Gas Tax, Discretionary Sales Tax, Golf Course and Airport); Situational Analysis - Every two years, as part of the Strategic Planning Process, an analysis of the demographic, legislative, and customer reqmrements shall be made. Part of the project includes a "SWOT" (Strengths, Weaknesses, Opportunities, Threat) analysis. Financial Trend Monitoring System - A set of financial trends and ratios used as leading indicators and as a measurement of relative performance. The Finance Department shall produce this report annually. Revenue Manual - A gu/de to the major revenue sources that indicates the source, calculation, legal requirements, and accounting guidelines. Updated annually, as necessary, by the Finance Department. Reserve Analysis - The City Finance Director will annually review the reserve levels and produce a report that indicates up-to-date reserve levels as compared to policy goals. Investment PorOColio Reports - A quarterly report designed to track and analyze the performance of our investment portfolio. Investment Policies Investment Management The City Finance Department shall perform a cash flow analysis of all funds on a regular basis. Disbursement, collection, and deposit of all funds will be scheduled to insure optimum cash availability. (See Investment Policy.) Date: 9/16/2004 7 City of Sebastian Financial Policies When permitted by law, the City shall pool cash from each respective fund for investment purposes. Investments shall be managed by a th/rd-party administrator to achieve optimal remm on the City's investments. Investment Analysis The City shall review its investment policies established for investing surplus funds to account for changes in legislation and market conditions on an annual basis. The City shall prepare quarterly investment portfolio reports containing the overall performance of the fund. Date: 9/16/2004 8