Loading...
05/05/1997 - Minutes City of Tigard, Oregon Budget Committee Meeting Minutes May 5, 1997 Members Present: George Burgess, Craig Dirksen, Gene Farnstrom, Paul Hunt, Brian Moore, Jim Nicoli, Joyce Patton, Bob Rohlf,Ken Scheckla, and Max Williams. Staff Present: Wayne Lowry, Bill Monahan, Cyndi Turner, and Michelle Wareing. Guest Present: Paul deBruyn,Director of Network Services for City of Tigard. Call to Order: The meeting was called to order at 6:3lpm by Joyce Patton, Committee Chair. Minutes: The April 1, 1997 were approved as written. Motioned, Second, Passsed(MSP) Joyce stated that the Budget meeting needed to end at 8:30pm, since a special City Council meeting was to follow. Social Agency and Arts/Events Funding: Wayne Lowry reported that a blank matrix was distributed to each of the Committee members. Each Member was responsible for allocating the funds to each program. Wayne stated that he took the average amount allocated to each of the programs by the Committee members. The total amount of funds available for program support is $83,700. Once the average amounts for each program was totaled, the total amount to be distributed to the programs exceeded the budget limit by$2,500. Wayne instructed the Committee that they needed to determine how they wanted to allocate the $83,700 without going over. Wayne responded to a question from the last meeting regarding special event insurance by distributing a memo from Loreen Mills,Risk Manager for the City. Ken Scheckla questioned why Brian Moore had allocated $1,000 to the Tigard High School Graduation Celebration,when the School had only requested $500. Brian stated that he felt it was a quality program and that the School had undercut themselves. Jim Nicoli suggested that the average amount for each program be rounded to the closest $50 in an attempt to decrease the total amount given. Gene Farnstrom asked how the City came to be involved in arts/events funding and who else could the Committee invite in requesting funding. Bill Monahan responded that anyone can request funding. He also stated that over the years,new groups have emerged requesting funding and others have dropped out. Wayne Lowry stated that the City was very involved in supporting TCYS, a youth services program in the early 1980's. The City allowed TCYS to use what is now the Interfaith Outreach Building. The Senior Center has always been funded by the City. Wayne also reported that several of the arts programs used to be run by the City. One example of that is the Country Daze program. About four or five years ago, the arts/events programs were 1 separated from social agencies in regards to funding. A policy and application process was developed. Max Williams suggested that the Committee adopt Joyce Patton's allocation schedule since her numbers were closest to the budgeted amount. Craig Dirksen pointed out the Committee did not have to spend all of the $83,700 if it chose. George Burgess stated that the Committee did not have to spend any of the money. Jim Nicoli asked unofficially how many of the members supported adopting Joyce Patton's allocation schedule. About six of the members supported the idea. Gene Farnstrom stated that he was concerned that Interfaith Outreach was not getting enough funding and he asked Joyce how she came up with her figure of$6,500. Joyce responded that she needed a few minutes to check her notes. Jim Nicoli stated that he determined his allocation figure by calculating the amount of rent the City could collect on the property. Currently, Interfaith has free use of the City owned property. Jim determined that a month's rent was worth $800 to $1,000. Interfaith has six more months of free rent before they move out. So the City's contribution includes cash support and free rent. Joyce stated that she used similar calculations in determining her allocation amount. Wayne Lowry reported that Ed Wegner, the City's Director of Public Works,had a realtor look at the property to determine how much the City could charge for rent. The realtor determined that the City could rent it for$500 to $600 a month. Max Williams motioned that the Committee adopt Joyce Patton's schedule for allocation of funds. Those that voted for the motion were Ken Scheckla, Gene Farnstrom, Max Williams, Joyce Patton, Jim Nicoli and Brian Moore. Those that voted against the motion were George Burgess, Craig Dirksen and Bob Rohlf. Paul Hunt abstained from voting. The motion was approved with six votes. MSP 1997/98 Budget Message- Bill Monahan, City Manager,presented the budget message. Bill stated the goal of the City was to maintain as much of the 5 Year Plan as possible, but the City must take into account the effects of Measure 47 (M47). To limit the impact on operations, several positions available will be frozen and the City will reduce costs. However, no cuts will be made to current personnel positions. With the current 1996/97 budget, the City will end the 5 Year Plan cycle with$1.6 million in the reserve fund. It has been determined that frozen positions from FY 96/97 can be restored even with the passage of M47. One position is in the Library and the other three are in the Police Department. No new positions will be added to the Library. The Police Department needs seven new vehicles and one motorcycle. Public Works is combining four temporary positions into one full-time position. Community Development is adding one building and data entry position to support the building inspectors. 2 As the City takes over Washington County's Urban Services, nine positions will be added to Community Development. However, these positions will not be funded by City funds. Washington County is paying the City $215,000 up front and the City will receive the fee revenues generated by providing service to the Walnut Island and Bull Mountain areas. Capital Improvements include the building of the Menlor Reservoir. The City also plans to replace all water meters over 1 1/2 inches with more accurate meters. The City will be able to better determine actual water usage with the new meters. It has been determined that the meters will pay for themselves in three years. Bill reported that if Measure 50 (M50)passes the City will have an opportunity to revisit the budget and make alterations. Basically, the City has three choices if M50 passes. First, the Budget Committee can be reconvened and can make the adjustments. Second, the City Council can make the adjustments. Third, the Budget will not be adjusted and the City will wait for the 1998/99 budgeting process. Bill recommended that the Budget Committee be reconvened and that the Committee review Library and Police positions. If M50 does not pass, the Budget will stay the same. Jim Nicoli stated that the City should not dip into the reserve fund to maintain current levels of service. If the City provides the same levels of service,but is operating with less money what message is being sent to the voters? He proposed cutting library and police services. Perhaps reduce library hours and the types of cases the police responds to. Jim was also concerned about the new nine positions being generated by the Urban Services program. When the City agreed to take over the County's Services, it was on the promise that it would not cost the City and the tax payers any money. The Urban Services program should be monitored very closely. The Program should be reviewed every 3 to 6 months to make sure that the positions are being paid for by the fees generated. If the City is losing money on the deal, City Council and Washington County should review. George Burgess responded that cutting Library hours is counter-productive. The money the Library receives from the County is calculated on the Library's circulation. If operating hours are cut, fewer books will be checked out and circulation will go down. A lower circulation will mean less money from the County. Once again,hours will have to be cut and possibly positions to make up for the loss of funding. Paul Hunt stated that what is paid out to the County in taxes is equal to what the Library receives in County funding. Bill stated that the City will not continue to do "business as usual"in the future. Positions that were approved in the 5 Year Plan will not be filled. The biggest increase in positions was in the Police Department. As the City grows over the next five years, the Police Department won't. However,there is some good news. The anticipated losses for the City are not as significant as expected. The City is not losing State revenues. Wayne reported that a lot has changed in revenue forecasting. If M47 had not passed, the City would have had enough money to fund the 5 Year Plan for 7 or 8 years because the City did not lose State funding as anticipated. As of now, the City can maintain current staffing,but cannot 3 add as many new positions. The 5 Year Plan had projected that the City would add 25 new positions, so far only 4 of those have been added. The cuts that are being made now and in the future are in anticipated positions that will not be filled. The City will save money in the future by not filling positions now. Jim stated that if the City loses $2 million and services don't drop what will that say to voters. Tigard is not as affected by M47 because of all the future planning that has be done. However, if voters see that the City lost money,but is still operating at the same level, voters might believe the City was wasting the $2 million. There is a possibility that voters will continue to take money from the City in the future if service levels don't drop. Paul Hunt stated that he would prefer to see more money in the Police Department and cut other areas. He feels that other City positions are not as critical as Police positions. Brian Moore responded that Library and Police positions are general fund positions. Most other City positions are only partially funded by the general fund. How many other positions would need to be cut to make up enough general fund saving to support a new general fund position. It would take too many positions since such a small portion of other City positions is funded by the General Fund. Wayne Lowry stated that the 1997/98 budget is not a"business as usual"budget. There is a 10% cut in materials and services in all departments, not just general fund departments. The 1997/98 budget has been reduced. Jim asked if the voters can"see"the cuts to materials. Also, can staff work effectively and adequately with the material cuts? Craig Dirksen responded that if the City can make the cuts and the Citizens don't notice that is a good thing. The City is here to serve the citizens. The City is running more efficiently. Max Williams asked"How does dipping into the reserve fund affect the city? Does it jeopardize the future City needs? Does taking money now rob the future?" Wayne responded to Max by stating that he has a policy on how low the reserve should go. The lowest he will allow the reserve to go is $1.5 million. The way funding has worked over the last 20 years is that a reserve is built up over the first three years and then part of the reserve is spent over the last two years in a five yr. budget cycle. However, in the post M47 era, changes will need to be made in budgeting for the future. Eventually, the City will not be able to maintain current levels of staffing and everything will deteriorate. Budget Document: Wayne Lowry presented the 1997/98 Budget. Wayne noted that page 1 shows the break down of the budget into four sections. The sections are Budget Information, Fund Revenue, Program Expenditures, and Appendix. That page is then followed by budget policies and procedures. Wayne reminded everyone that the copy of the budget they have is just 4 i ;fir a draft and not ready for printing. Wayne requested that if anyone finds any errors,please make note of them and let him or Cyndi Turner know. The Property Tax Summary is located on page 8. The assessed value of City of Tigard in 1994/95 was $2.45 billion and is projected to be $3.39 billion in 1997/98. For FY 1996/97, Estimated Construction has already reached$100 million and there are still two months to go. The City of Tigard and its value are growing. The City of Tigard has a low tax rate. In 1994/95, the rate was $2.55/$1000 and for 1996/97, its $2.54/$1000. The City can raise a lot of money with a small tax rate because of all the commercial development. M47 does not affect the City's taxing authority,but does prevent the City from collecting all of its tax bill. The current tax base increase is 6%,but M47 allows the City to collect only a certain amount of tax from each property. M47 doesn't recognize the current tax base, it rolls the tax base back about 3 fiscal years. M50 recognizes the current tax base and then decrease it by 17%. With M50, citizens will still see a savings of$37/$1000. The Assessed Values graph can be found on page 11. The Budget Matrix is located on pages 13 and 14. Nowhere else in the budget can you see the relationship between funds and how each department is allocated among them. Community Services are fully funded by General fund/property taxes because everyone uses those services. The Urban Services program has been placed in the Development Services section. Wayne stated that a fund has been established to support the Urban Services program. Every position that oversees or is affected by Urban Services will have a portion of their costs charged back to the Urban Services fund. If the $40,000 contingency is not spent, there will be more money in the fund for the future. Wayne stated that the amount charged back to the Urban Services fund will be determined by permit activity. Pro Forma Statements are located on pages 15 through 17. Pro Forma Statements are generally found in year-end documents. The Statements included in the budget are what is anticipated for year-end 1997/98. The Five Year Plan Projection Summary and graph can be found on pages 19 and 20. The Projection Summary denotes future cuts that will be made in the 5 Year Plan. Wayne stated that he has worked with the Plan and has identified revenues that can be used to add some positions approved in the 5 Year Plan. The City cannot implement all approved positions because of M47. On page 22 is the Revenue Summary. The total proposed revenue for 97/98 is $53 million. The general fund revenue proposed is $13 million. The Revenue Summary shows the general fund and restricted revenues. 5 The break down of the general fund can be found on pages 24 and 25. The proposed 1997/98 current taxes are $4.4 million. If M47 had not passed, current taxes would be $6.6 million. For the first time in several years, the general fund declines which is due to the passage of M47. The Building fund summary is located on page 35. The Urban Services growth is expected to be similar to that of City of Tigard's which is why the new positions are necessary. The Traffic Impact Fee-Urban Services fund can be found on page 40 and the City's Traffic Impact Fee schedule is on page 39. On page 38 is the State Gas Tax summary. Wayne reported that a higher tax rate will most likely be approved by the State Legislature. This means revenues for next year could increase by $200,000 and $400,000 the following year. The new rate would almost double the per capita revenues that can be used on capital projects. The Program Expenditures section which makes up the bulk of the budget starts on page 51. The Operating Budget History and Expenditure Summary are located on pages 55 and 56. The 1997/98 operating budget has been decreased about 4%over the current budget. There is usually a 6% increase over the last year's budget. The 1997/98 budget is about the same as the 1996/97 budget. If the Urban Services program was taken out, the expenditure amounts would be quite a bit less. The Total Operating Budget for the City can be found on page 57. Wayne stated that when he received each departments individual budget, there had been a large decrease in capital outlay. Wayne went back to some of the departments and had them put money back into capital outlay. Wayne stated that it is better to keep equipment updated and on schedule, then to cut budgets and have to replace a lot of equipment all at once. Wayne also reported that there are currently 219.16 FTE in the budget proposal. The breakdown of each departments expenditures begins on page 60. Each department section contains a narrative,performance indicators and expenditure summary page. The Total Debt Service section begins on page 180. The projected annual debt service graph is shown on page 182. There is a large drop in the year 2000 because the 1989 road bonds will be paid off. Debt service is declining, so 1998 or 2000 would be a good time to got to the voters. Bancroft Improvement Bonds graph is located on page 184. These bonds are not funded by taxes. Since 1986, the City has been making money on the assessments. Once all bonds are paid off, Wayne expects the fund to contain about $500,000. This fund can then be used to fund future LIDS. Wayne noted that the Five Year Capital Improvement Plan, on page 188, is blank. Since this section parallels the budget process, the numbers will be filled in later. 6 The Summary of General Capital Improvements is located on page 187. Capital projects are funded with money from the general fund. Several projects that were being charged to Park Maintenance have now been placed in capital improvements. The Police Department remodel has been put on hold, so the facility funds that were to be used for that project will now be used for the purchase of Urban Services modular. The City will buy the modular and the Urban Services Fund will pay the Facility Fund back over five years with interest. Wayne stated that anticipated future contributions to the facility fund had been moved into 1997/98. There is actually only one more contribution of$50,000 expected. The purpose for this was to make sure that there would be funding for the Police Department expansion if M50 passes. Wayne noted the following: Staffing Summary on page 197 is calculated in FTE not positions, Salary Summary is on pages 198 through 201 and Schedule of Capital Equipment is on pages 202 through 205. Paul Hunt asked what were the 11 building positions in the Development Services section of page 197. Wayne responded that the positions include transfer of a Code Enforcement position, one City Council approved position and the nine Urban Services positions. Joyce Patton called a five minute break before Paul deBruyn's presentation. The meeting was reconvened at 8:15pm. Network Services: Paul deBruyn,Director of Network Services for City of Tigard, gave a presentation about his department. Paul distributed a hand-out which gave a recap of the 1995 Long Range Plan for Network Services which he followed with a short video presentation about Network Services. Video presentation: Network Services is only about 2 1/2 years old and was created to build a contemporary computer system. The goals of Network Services is to be proactive and build for the future,have hardware and software that can grow,provide multiforms of communications and provide quality training. Hardware only has a three year life cycle and hardware speed doubles every 18 months. As machines become faster, they need better and faster software. The City is currently moving in more powerful machines and placing slower models at less used work stations. Network Services is currently replacing outdated software in Finance and Human Resources and upgrading TideMark, the Building Department's software. Paul stated that he has established a policy for what type of computer equipment can be purchased, so that all the computer equipment is compatible. There are many forms of communications that can be aided by computers. The Library is now offering the public access to the Internet on public terminals. Council Members will be able to dial in and get Council packets and information. Staff members will be able to telecommute from home. The City will also be able to trade information on-line with other agencies. This is especially useful for the Police Department. 7 Network Services is responsible for training all City staff and Council Members. Training is an on-going process. New employees must be trained and current staff must be trained as new software is implemented. Network Services is in the process of restarting its training program. The video presentation was concluded. Paul stated that the goals described in the vidoe are all part of the 5 Year Plan. He reported that the City now has a world wide web page. Also, the new network system has an up-rate (working)reliability of over 99%. The old system's reliability rate was 60% - 75%. Paul requested that Committee turn to page 156 in the 1997/98 Budget to review Network Services budget. The figures provided take into account the passage of M47. Those figures were adequate,but some recent resignations will affect Network Services budget. To provide computer assistance to staff, a core group of City employees was established a few years ago. The group was made up of four people,but now there is only one. There are three other people in the City who can assist with software applications,but who cannot fix hardware problems. The person that recently left worked in the Police Department. She was able to assist with software applications and fix hardware problems. The Police Department has requested that she be replaced with two positions. One that can assist with software and the other that can fix hardware. This is especially important as the Police Department upgrades its equipment and connects with Portland's Police system. Network Services needs more people who can work with hardware. Paul stated that he had anticipated hiring a third position in his department,but due to M47 that position will not be filled. Currently, Paul and Valerie, the other Network Services person, are responsible for over 200 computers city-wide and there will be more with Urban Services. Paul requested that if there are any additional funds, that they be used to fund an additional Network Services support position. Computer related services and equipment budget was cut by 28% for this year. There was discussion regarding the purpose of the core group. Paul stated that the core group was originally set up to assist users by using current staff expertise. Basically, the City was trying to utilize its in-house resources to save money. The core group system is now out-dated. The City loses its expertise as core group member leave the City. Network Services needs more positions to assist all departments. However, each department requires special knowledge and in the case of Police, a high level of confidentiality. Network Services should be responsible for maintaining computers and phones. Employees should not have to diagnose their own computer and phone problems. Network Services needs to decide when it should contract out for services. Paul stated that at times he does contract out when the computer problems exceed his expertise. Joyce Patton stated that the City needs to review its Information Services structure. Perhaps services could be consolidated. She stated that Paul should be able to hire the people he needs and who have the expertise he desires. 8 Bob Rohlf suggested taking the resigned positions and turning them over to Network Services department. Paul responded that the departments that the people left still need someone in those positions. The core group members' main responsibilities were to their individual departments and provide network service when they had available time. Brian Moore stated that a FTE needs to be added to Network Services. Wayne Lowry responded that the budget would have to be adjusted or changed. Next Meeting_ The next meeting will be held on May 12, 1997 at 6:30 in Red Rock Creek Conference Room at City Hall. Talks regarding the General Fund will continue. The Library, Police and Parks (Ed Wegner)will give presentations. Wayne Lowry will discuss the 5 Year Plan more. The Budget Committee meeting was concluded at 8:57pm and discussions will continue at the next week's meeting. MSP 9