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HomeMy WebLinkAbout06182009BUDarr a ~,~,~~-s~r~-N ~::. ~.. HOME OF PELlC11N ISLAND CITY OF SEBASTIAN CITIZENS BUDGET REVIEW ADVISORY COMMITTEE MINUTES June 18, 2009 @ 6:00 p.m. 1225 MAIN STREET, SEBASTIAN, FL 32958 The Citizens Budget Advisory Review Committee Meeting convened at 6:00 p.m. 2. Chairperson Ed Herlihy called the meeting to order. 3. Roll Call: Adrina Davis -Present Ed Herlihy -Present Jerry Klenck -Present Charles Cardinale -Present Brad White -Present Joan Rivard -Excused Absense Chris Vicars -Present Staff Members present: Al Minner, City Manager Ken Killgore, Finance Director Debbie Kruger, Human Resources Director Audience: Don Wright 4. Approval of Minutes of May 20 2009 Meeting: Motion to approve by Adrina Davis, second by Charles Cardinale. Approved 6-0. 5. Bud etgUpdate -City Manager: Al Minner distributed charts showing long-term financial forecast with different millage rates. He reminded everyone about the State imposed limitations that applied to setting the millage and explained how this could get the City in a difficult position, unless we take the precaution of adopting small increases in the millage. The chart titled "Balance the Budget" showed that adopting a 3.7051 millage for this year would balance the budget and could be expected to keep us in a position to adjust future year rates with a simple majority vote of the City Council. The other hybrid approaches are expected to result in situations that will cause severe reductions in services or require more than three votes to avoid depleting cash reserves. Don Wright interjected concerns that we can expect reductions in business assessments that are not yet reflected in the values we are working with and that residents could be expected to bear a greater share of taxes. AI Minner explained that the projections were thought to be "fair" representations of what could result with revenues and expenses but actual results could be even more negative. A home that was valued at $200,000 in 2008, would still have a $53 reduction in City taxes with the 3.7051 millage. Page 1 of 3 Budeet Discussion by Members: Chairperson Herlihy shared information from the Internet regarding housing values, homes for sale and number of foreclosures in Sebastian and expressed concern about additional drops in value that can be expected. He suggested that it may be time to consider reductions in the City's cost to provide employee and dependent health insurance. Al Minner responded that with other payroll cost reduction measures taken this year, action on the health insurance was not thought to be fair. One issue he wants to address is getting the union contracts on the same cycle, so that changes could be done concurrently. He would also want one-year agreements. Chairperson Herlihy added that a video broadcast explaining the budget projections and tax calculations would be beneficial. Al Minner responded that it very difficult to develop a simple and concise presentation on such a complex matter, as can be seen from the complexity of his charts and explanations this evening. Brad White commented that the actual numbers of foreclosures are probably double those shown in the information presented. Charles Cardinale questioned whether Staff intended to beef up our policies on foreclosed properties. Al Minner explained that during bad economic times, the need for additional employees for enforcement is the greatest but that the financial capability of the City is the lowest. Charles Cardinale wondered if we had statistics on "upside-down" homes. Brad White said that essentially everyone who bought since 2005 is in that position -maybe one-third of the properties in Sebastian. Jerry Klenck asked whether there are plans to do more annexation. Al Minner replied with his opinion that we should pursue properties along U.S. #1. He feels we should look carefully at residential annexations, as they typically will require us to provide additional services without equivalent revenues. Charles Cardinale wondered how many businesses we have lost with the economic downturn. He had requested information about the feasibility of a four-day workweek. Debbie Kruger provided a handout on her analysis and explained her calculations of the estimated savings. Al Minner added comments on how the furlough days related to the four-day workweek and discussed the issues regarding keeping the building department and other administrative offices open to the public. Chairperson Ed Herlihy questioned the change in the Police Department budget. It was explained that savings from the elimination of the Deputy Chief position were essentially offset by pay increases that were budget according to the PBA bargaining agreement. (Al Minner left the meeting at this time) Jerry Klenck had requested information on savings that could be achieved by turning off street lights. Ken Killgore replied that although those numbers were not readily on hand, the savings would be not be a substantial amount. Other members agreed that possible legal consequences would have to be considered. Chairperson Ed Herlihy commented that he felt next year's budget situation will be worse. Don Wright also commented that the City could be in trouble with expected additional declines in property values, since the police budget can't be cut and we are probably at minimum staffing for administrative functions. Jerry Klenck questioned the need to purchase ten police cars every year. Ken Killgore replied that Staff had also questioned this and it had been explained. Over the past few years, vehicles had been assigned to the volunteer program and the higher millage and higher maintenance Page 2 of 3 vehicles replaced. Some of those seen parked and not used may be ones that are in the process of being processed for disposition. We try to watch this closely and are very aware of the insurance cost. Brad White inquired about the advantages of having our own police department. Discussion followed regarding other communities that had contracted with their Sheriff departments' with mixed results. Chairperson Ed Herlihy shared that he had previously suggested to the City Manager that some of the work done in public works might be farmed-out, such as most of the mowing. Don Wright commented that the City loses the flexibility of being able to adjust employee assignments in order to take care of other things that may need to be handled. Chairperson Ed Herlihy said the next meeting will be on July 20`i' and by that time, the Committee would have the entire budget recommendation. By then, the Committee would need to determine whether they agree with Staff. Brad White said that based on the City Manager's presentation, the best approach was to set the millage at the rate indicated on the handout titled "Balance the Budget". There was a consensus that this was the preferred action and Chairperson Ed Herlihy suggested that Committee Members forward any concerns or feelings that another meeting may be necessary. He wanted to be sure that the Committee's concerns about what everyone is seeing in the real estate market was explained to the City Council. 6. Adjournment: The meeting was adjourned at 8:00 p.m. Approved at the July 20, 2009 meeting. Ed Herlihy, Chairman Citizens Budget Review Advisory Committee Page 3 of 3