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HomeMy WebLinkAbout05242011BUD MinutesPresent: William Flaherty Jerry Klenck Brad White (6:13 pm) Christine Vicars Ed Herlihy Not Present: Harry Marshall (excused) Al Alvarez (alt) HOME OF PELICAN ISLAND CITIZENS BUDGET REVIEW ADVISORY BOARD MEETING MINUTES 6:00 P.M. TUESDAY MAY 24, 2011 CITY HALL 1225 MAIN STREET SEBASTIAN, FLORIDA 1. Chairman Herlihy called the meeting to order at 6:00 p.m. 2. The Pledge of Allegiance was recited. 3. Roll Call: Staff Present: City Manager, Al Minner Finance Director, Ken Killgore Police Chief, Michelle Morris Deputy Police Chief, Greg Witt Senior MIS Systems Analyst, Barbara Brooke -Reese 4. Approval of Minutes: A. Meeting of March 22, 2011 MOTION by Mr. Klenck and SECOND by Ms. Vicars to approve the minutes passed with a voice vote of 4 -0. 5. Review Second Quarterly Report FY 2010/2011 The Finance Director went over the budget amendment to be presented to City Council tomorrow night, which summarizes the changes from the original budget in exhibit A. He said in the future he would include changes to the budgets for the capital project funds and he briefly went over the financial data which indicate that collections have been Tess than compared to the previous six months; and the balance of the report included the accomplishments of each department. Citizens Budget Review Advisory Board Meeting May 24, 2011 Page Two Mr. White arrived. In response to Mr. Flaherty, the Finance Director said the percentage on the interest bearing checking account was based on federal funds at .15% and staff is looking at investing with the State Board of Administration which is at .2 .25%. Mr. Flaherty asked if the amount shown in the interest bearing checking account is there because we know it is short term and want to it keep handy. The Finance Director explained in the general fund, the reserves are set aside for emergencies, and should be kept liquid. Mr. Klenck asked where the carry over from not buying all the police vehicles last year was noted. The Finance Director said the difference is in the DST funds and goes back into cash reserves; and all but $6,000 has been committed from the current year police vehicles. Mr. Klenck asked if we were in line in replacing that many vehicles and the City Manager said staff planned to start witling the number of vehicles down. Mr. Flaherty said it looks like we are running 44 -45% of the total budget, slightly under for two quarters and asked if this was indication that the City might be in better shape. The Finance Director said each department is prevented from exceeding their budget by law and at the end of the fiscal year the excess will pay for outstanding invoices, and maybe payroll accruals. In response to Mr. Klenck, the Finance Director said the two employee layoffs would not be marked in this amendment. Ms. Vicars said the amounts in the local option gas tax looked different than the previous quarter but there was no notation in exhibit A. The Finance Director said that line was affected by the street resurfacing payments and the 175 must be a misstatement because they do have to transfer monies from local option gas tax revenue into the capital project fund. He offered to research the amount. Mr. Herlihy asked if the Golf Course was headed back up again. The City Manager asked to go over the Golf Course at the end of the meeting. MOTION by Mr. Klenck and SECOND by Mr. Flaherty to recommend adoption of the second quarter budget amendment to City Council passed with a voice vote of 5 -0. Citizens Budget Review Advisory Board Meeting May 24, 2011 Page Three Board Discussion of Upcoming Budget FY 2011/2012 The City Manager said as he readied for the budget season he made some significant moves with the elimination of Growth Management Director and MIS Director positions; and he had two tracks to present to the Committee for opinion and recommendation to City Council. He distributed handouts related to his presentation. (see attached) He went over chart 1 and 2 which depicted general fund increases and decrease during the last twelve years and he emphasized staff is stretching operating pennies so spending less on operating capital will not really move the ship. FY2012 Projected Budget The City Manager outlined the City's income and expenses with an assumed 10% decrease and the same millage rate on chart 3 which will leave the City unbalanced. He said the big question mark is where the assessed values will fall in June and staff is doing homework with FPL to make sure they are paying the franchise fee correctly. 6:35 p.m. Plan A Plan B He asked the Committee to work through the two plans noting Plan B was in a stymie until June 1 and when they met again, they could see if this is an option. The said Plan A was a "batten down the hatches" plan with the possible retirement of three senior police personnel, restructuring of employees that would leave a budget hole of $242,040. Plan B He said Plan B was the ideal scenario; however, the enterprise funds weren't doing well cash -wise. He explained the Golf Course's historic high was after the greens were re -done and pre- hurricanes; but it has since decreased with irrigation and equipment issues that need to be addressed. He said would like to keep the rates where they are. He said the Building fund is the same, noting in 2006 there were 650 residential permits issued and there might be 21 issued this year. He explained if he put the Building Official, the Airport Director and two Airport maintenance workers into the general fund that will open up savings to reduce the Golf Course's lease payment, make future Airport improvements, provide grant matches, and repay the general and DST fund. He said when higher growth comes back he would put the Building Official back into the enterprise fund. Citizens Budget Review Advisory Board Meeting May 24, 2011 Page Four Summation Page He said staff will keep an eye on the electric franchise fees; there will be expenses with the bargaining agreement; noted the new actuary firm for the police pension will present scenarios to go to bargaining table with; he will continue with furlough 7:00 p.m. days, and know the health insurance cost by August. He said the special revenue stormwater fund is helping the general fund so a couple things must give to reduce that transfer. Questions Mr. Klenck asked if the Golf Course ever made a profit. The City Manager said it did in 1999 -2002 and we shifted the cash to the Airport to make improvements by increasing the lease; since then, the cash has been hard to come because play decreased, the bond started to take it's toll and the lease increased. He said it is breaking even but in the long term the irrigation system, rebuilding the greens and making some tweaks to the lease will need to be addressed. Mr. Klenck asked if the City ever thought of leasing or selling the Golf Course. The City Manager said selling isn't a viable option because it is Airport property and he didn't know if leasing pro shop activities would be realistic. Mr. Klenck asked it the club house and restaurant pay for themselves. The City Manager said the club house does but the restaurant is in a lease and they would not be able to increase the revenue. Mr. Herlihy added the Golf Course was given to the City with the Airport by the Federal government and it would be very difficult to separate them out. Mr. White offered to play more golf and sell more new houses to bring in ad valorem; said he listened to a State Representative who said the state has cut funding for growth /development and plans to give the oversight to the local level; and asked if economic development is generating more money for us. The City Manager said economic development has been passed over to the Airport Director and cited the following accomplishments: -The Airport borrowed DST funds to build the LoPresti hangars -V- Raptor is coming to build planes Economic Development Plan was incorporated into the comp plan with bullet points on ad valorem abatements, fast -track permitting He said the State helps us with their reorganization because it eliminates the bureaucracy the City has to deal with and gives us more home rule. Ms. Vicars asked about the big jump in the loss ratio regarding the health insurance. The City Manager explained there have been a couple of big claims which is indicative of the size of our pool. Ms. Vickers asked if points could be knocked off if the employees go to smoking cessation clinic. He said the City has tried to do some wellness clinics. Citizens Budget Review Advisory Board Meeting May 24, 2011 Page Five rlihy, Chairman Mr. Flaherty said the last minutes cite that the Board has not spent much time discussing the capital budget in the past and he asked when they will discuss the capital budget. The City Manager explained that he left the Board out of the loop on the special revenue /capital fund because they have a different process in that they get looked at by the P &Z Commission and then go to Council. Mr. Klenck said he did not realize they were looked at by other boards. Mr. Klenck said at the last meeting they discussed the local option gas tax and the Administrative Services Director was going to report back to them. The Finance Director explained the County can share the tax, but we have to request it. The City Manager said they did talk about it but there was no desire to increase that tax. Ms. Vicars remembered an e-mail from the Administrative Services Director. Mr. Herlihy said there was no Council interest in increasing the tax and there is no guarantee the City would see a mil of it. Mr. Klenck asked if staff looked into taking collision out of the insurance policy and asked if the employees are at fault or others. The City Manager offered to provide the Board insurance details. Mr. Herlihy asked the Finance Director to e-mail the June 1 Property Appraiser's numbers to the Board members and reminded them of the next meeting on June 9 He asked permission to report to Council that the general fund is on target, brief overview of the enterprise funds and the 2012 initial presentation. There was no objection. Mr. Flaherty said embedded in the minutes are action items and he asked if they could be provided a summary to make sure the items are done. 6. Being no further business, Mr. Herlihy adjourned the Board meeting at 7:30 p.m. Approved at the June 9 2011 Citizens Budget Review Advisory Board meeting. 9 Jeanette t lams, Recording Secretary