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05/04/1998 - Minutes City of Tigard, Oregon Budget Committee Meeting Minutes Revised May 4, 1998 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: Amanda Bewersdorff, Paul de Bruyn, Gus Duenas, Wayne Lowry, Bill Monahan, and Melinda Sisson. Visitors: John Anderson, Charlie Cutz, Sharon Maroney, and Emily Tso. Call to Order: Joyce Patton, Chair, called the meeting to order at 6:30pm. All members were present. Approval of Minutes: The minutes for the April 16, 1998 meeting were approved. MSP Broadway Rose Presentation: Sharon Maroney updated the Committee on the news of the theater company receiving new office space and donations of office supplies. There will be five shows in the eight-week period. There was a growth of 30% last year and it was their biggest season. The Tigard-Tualatin School District is their biggest supporter. Long-term goal: To become a year round company with a performing art base. Provide a relationship between kids and professionals. Provide drama camps for kids. Additional funding was requested this year due to the Hello Dolly! production. It is a big show and production costs will be $50,000 - $60,000. This performance will bring extra people to the theater. Sharon stated that the theater has added two new administrative salaries - $5,000 for a general manager and $7,200 for a part-time administrative assistant. Craig Dirksen asked if the loss of Larry Daw will have any affect on the theater? Sharon responded that his retirement should not affect the theater and that she is looking forward to meeting the new person coming in. Joyce Patton asked if the Broadway Rose's long-term plan is to stay in Tigard? Sharon responded that Broadway Rose will stay in Tigard and plans to go to a year round theater. Sharon noted that the theater would continue to keep summer stock going with kids. Selection of Chair and Secretary: Jim Nicoli nominated Joyce Patton for Chair. Brian Moore seconded the motion. Joyce Patton was selected as Chair. MSP Paul Hunt nominated Craig Dirksen for Secretary. Joyce Patton seconded the motion. Craig Dirksen was selected as Secretary. MSP Brian Moore moved to close the nominations. MSP 1 Allocation of Social and Events funds: Wayne Lowry explained the funding request worksheet and the averages that were calculated. Wayne stated that the far right column is the average of all the Committee's allocation of funds. The "Ex-George" average column is the average of the allocation of funds minus George Burgess's vote. Joyce opened the discussion of the allocation of funds to the members Paul Hunt asked if the amount requested by Interfaith included rent. Wayne responded that Interfaith is requesting $8,000 in cash plus the use of the building. Bob Rohlf moved to adopt the average excluding George's vote and Jim Nicoli seconded the motion. The motion passed with nine approvals and one opposed. MSP Joyce stated that $93,693 is the amount to be distributed for funding of Arts and Social Agencies for FY 1998/99. Brian Moore asked if the remaining $2,300 would be allocated to another program or put back into the General Fund. The Committee agreed the money would be returned to the General Fund and could possibly be used for the "Freedom Train" expense discussed at the April 16, 1998 meeting. Gene brought up the question of entertaining the idea of a separate session for the Social and Events Policy after the end of this budget cycle. The Committee agreed that it planned on reviewing the Policy after the budget was approved. FY 1998/1999 Proposed Budget and Budget Message: Wayne Lowry distributed drafts of the proposed budget for FY 1998/99. Bill Monahan reviewed the budget message. Bill stated that the City did not lose significant property tax revenues as anticipated as part of the passage of Measure 50. The voters did realize an overall reduction in property taxes because of cuts made to the fire district, county and school district revenues. The City was operating under a 5 Year Financial Plan, however, the Plan has been extended through the year 2006, making it a 10 Year Plan. The amount projected for the operating budget for FY 1998/99, under the 5 Year Plan was $21,735,567. The proposed budget for FY 1998/99 represents an increase of 11.5% over FY 1997/98's budget. The 1998/99 proposed budget is about $200,000 less than the limit set by the 5 Year Plan. The overall budget includes 13.35 new positions with 8 positions in Public Works, 2.35 FTE in Library, and 3 in Development Services and Administration combined. Total Capital Equipment requests are in the amount of$935,391. Police No new positions are being requested for the 1998/99 budget. Three positions were brought forward in the Plan and hired in FY 1997/98. Increases include training for emergency vehicle operation and the purchase and training of a new police dog. 2 Library Bill stated that the Washington County Board of Commissioners decided to continue library funding at current levels. The City will receive about $1,146,000 in WCCLS revenue. The Library budget proposes the addition 2.35 new FTE positions for the readers services as well as additional help in technical services and circulation. The main increase in the Library's budget is the addition of 17 new computer workstations as part of the upgrade required for the conversion of the County's data base system. Public Works The Public Works budget requests an additional clerical position, an urban forester position, and an utility worker position. Wastewater functions of Sanitary Sewer and Storm Sewer proposes the addition of 2 utility worker positions to comply with the new Unified Sewerage Agency standards for system maintenance. Also, it is proposing to purchase an additional line cleaning truck for wastewater system maintenance. In November 1997, the Street division became responsible for street maintenance in the Urban Service Area. Two street utility workers were added in January 1998 to assist with these new responsibilities and are paid with funds from the County. This budget proposes the continuation of the street maintenance services to the Urban Services Area. Fleet Maintenance budget unit requests an additional mechanic position. The Water Operation budget proposes the addition of a clerical position. Capital Expenses includes the cost for a replacement dump truck and removal of in-ground diesel fuel tanks at two reservoir sites. Community Development Bill stated that Community Development took on responsibilities in the Urban Services Area in FY 1997/98. Community Development is proposing a new program called the Community Housing Program. Bill noted that the program is currently being developed by a task force and has not been reviewed by Council yet. Bill stated that the Community Development budget includes costs for consultant fees for implementing visioning goals regarding the Washington Square regional plan. Engineering is budgeting for a .5 FTE clerical position to assist with administration and data entry within the department. Street lighting budget which is funded by gas tax dollars includes the following: $350,000 for power; $70,000 for light and traffic signal maintenance; and $10,000 to refurbish metal light poles as needed throughout the City. 3 City Administration Two new positions are proposed. Network services is requesting a third network technician and the Accounting section is proposing an additional position to monitor City business tax. Finance is requesting $54,000 to upgrade the City's utility billing software. General Government Attorney fees are now being allocated to the individual department budgets to better manage the program. Capital Improvements The proposed budget includes $22,501,750 for capital improvements. About half of the funds requested will go to Water and Wastewater projects. Debt Service Road bonds issued in 1989 will be expiring at the end of this proposed budget year. The City Council is expecting to put forth to the voters a public facilities bond issue for consideration. If passed in November 1999, it would not be levied until budget year 1999/2000. Awards The City continues to participate in the Government Finance Officers Association awards program. The City received the Certificate of Achievement for Excellence in year ending June 30, 1997. The City also received the Distinguished Budget Presentation award for the 1997/98 budget. Conclusion The City has tried to comply with the intent of Measure 50 while at the same time following the direction of the financial plan and the result is the proposed 1998/1999 budget. Revenue Protections: Wayne Lowry highlighted several sections in the Budget. Wayne stated that the Property Tax Levy Summary was located on page 9. Wayne noted that part of the budget process was the Committee's approval of the property tax levy. Wayne stated that the Actual 1997/98 column is based on a dollar figure. The Proposed 1998/99 is based on a rate. The General Fund Permanent Rate is 2.51 per$1,000 of assessed value. Wayne noted that it is the rate that the Committee will approve from now on and not the dollar amount. Wayne stated the rate cannot be increased since it was calculated by Measure 50 and only the Legislature can make changes to the rate. This rate is will be applied to all future assessed value to determine how much tax revenue the City will get. The Committee's motion will be to levy the 2.51 rate or some number less than that. 4 New construction is estimated at $90,000,000 and the City will benefit from this. When these properties come on at their new value, the rate of 2.51 will be applied to them. Assessed value in the future can go up 3% plus new construction. It will be the new construction that will drive the increase in property tax revenue. The dip in assessed value on page 11 was due to the adjustment for Measure 50. Wayne went over the graphs in the Revenue Summary section (p. 23 - 27). Wayne noted that the reason the connection fees were decreasing while permit revenue was increasing was due to Unified Sewerage Agency collection of fees related to sewer and storm drain connections in the Urban Service area. The City has more activity today than before because of the Urban Services area, but there is less activity in the City of Tigard. Wayne stated that the Fine Revenue Graph is on page 27. The Graph shows revenues received from traffic citations. The increase in revenues is most likely due to the increased number of citations issued, more patrol officers and general growth. Engineering: Gus Duenas, City Engineer, presented his department's budget which begins on page 126. The total Engineering budget is $988,148. Gus stated that the Streets Lights and Signals budget is $430,000. Brian Moore asked why street lighting is in the Engineering budget and not the Street budget? Gus responded that street lighting has historically been part of the Engineering budget. Gus stated that he plans to turn street lighting over to Public Works and will be talking to Bill Monahan and Ed Wegner about this issue. Wayne noted that street lighting was in the Street budget seven or eight years ago. Gus stated that he was concerned that there will not be sufficient personnel in Public Works to devote time to the program. Administrative Specialist half time is need for date entry - clerical work. This will allow Diane - Current specialist to assist in Budget and special projects without having to try to find the time or hire other temporary help to complete these tasks. After 1998/1999 budget, the Engineering department will look at the possibility of sharing this position with another department. Gene asked why there was an increase in Materials and Services? Gus stated it was due to the pavement management system, contracting with consultants to update software, plan review and Auto CAD support, and other additional temporary drafting help. This will allow plans to be ready on time and to better plan the construction being done. In order to keep maintenance costs down, Gus plans to replace a van every 10 years. Gus also initially budgeted for a new car, but instead Engineering will use a former police vehicle to cut costs. The replacement car will be good for approximately two years. 5 Max asked what are the big, upcoming Capital Improvement Projects? Gus responded that the big CIP projects were the Pavement Maintenance Program and the Walnut/Tiedeman realignment construction. The City wants to be ahead of the County and their 121st/Walnut light. They are also still working on the speed bump program. Ken asked if the City set its construction back would the County step back and tell the City to do it? Gus responded that the 121 st/Walnut project is already funded. Gus also wanted to state for the record that the positions titled Senior Project Engineer should be retitled as Engineering Manager. Wayne noted that the Summary on page 61 shows groupings of accounts across the whole City budget. If anyone needs a breakdown of the information, Wayne stated to call him and a breakdown spreadsheet would be created. Network Services: Paul deBruyn, Director of Network Services, presented his department's budget which starts on page 146. Paul noted that they hired a new technician, Rich Daly, who is doing a great job. The Core Group was abolished and Network Services is absorbing this additional work. The Group was abolished because the members could not be trained on the new technology fast enough due to the constant addition of new software. Network Services is requesting the addition of another technician for FY 1998/99. This request is being moved up a year in the financial plan. Equipment-Work done/Coming Up: -New police building -New inspectors module. -Remodel of existing police. Real busy year preparing for the year 2000 on the software side. Looking to speed up the network because the volume of data has increased more than ten fold. One server was running four hundred billion bytes in a month and had only 14 errors. This shows that the network is pretty reliable. Future Plans: -replace couple of file servers -new accounting system implemented -new permitting system (Community Development) -more training -full training for new FTE -Paul, Valerie, and Rich on Windows NT software in addition to Novell. -recableing in Library for new computer changes -new e-mail system with Scheduler and Fax Starting to replace the 486's and have reached the three-year recycle point. Recycled equipment is being kept within the community. 6 Joyce questioned what the "exploring a joint project with the City of Hillsboro" meant? Paul stated that it was a project which is no longer viable due to the City of Hillsboro backing out. Craig asked what the standard upgrade will be when 486's are replaced? Paul responded that the entry level machine is a P200 MMX. Craig questioned if these computers are the bulk of the equipment budget? Paul explained that the bulk of it is for the new server and maintenance on printers which used to be allocated to individual departments. Max questioned if the computer equipment increase in funds request is solely for the server? Paul stated primarily, but there are a couple of laptops in the budget for emergency use and telecommuting positions. Some of the expense are also for new HUBS for the police and Library areas, as well as a new computer for the new technician's work area. Wayne noted that on page 191, there is a list of all the capital equipment. Computer systems are under 3220. Max questioned if there was monitoring of the Internet? Paul stated that there is a system in place, but not acting on it at this time. Max stated that he is concerned about non-work related use during City working hours. Bill stated that the City initially allowed people to use the Internet with out restrictions, so staff could learn how to use it. This will be a discussion topic at the Exec-staff meeting on May 6, 1998. E-mail and voice mail training is provided, so people are aware of what their responsibilities are and what the City deems as abuse. Brian stated since the City's Internet software has a usage tracking device, this is already a deterrent for misuse even if a policy regarding appropriate Internet usage has not been established. Max asked where does the City draw the line in letting employees use the Internet. Gene questioned the Performance Measurement on page 47 and how close Network Services came to completing those goals. Paul stated that there was only one bad outage in 1997/98 which caused the reliability percentage to drop to 93%. The computer upgrades have been done and Network Services has exceeded their goals so far this year. City Administration: Bill Monahan, City Manager, presented his department's budget which starts on page 135. The City Administration budget is comprised of four budget units, Mayor and City Council -Increase in Prof. & Contract Services because of allocation of City Attorney services across all budget categories: -National League of Cities dues were moved to General Revenue Expense. -Travel and training varies. Quite a bit due to the possibility of two new council member and a new mayor; these positions are coming up for election. -Capital outlay was increased for the possibility of new and/or existing Council members requesting the City to provide them with a computer. 7 City Administration -Major change is due to the addition of 1 FTE that was added since the Budget Committee met last year. (Volunteer Coordinator) -"Overtime" is a misnamed in this budget. Should consider it as contractual agreements that Council has with Bill Monahan to cover cost for auto insurance as well as funds to purchase life insurance. Costs had previously been allocated to wages expense. -Prof. & Contract Services increased due to mediation program and a Code Index Update that will be done. -Special Department Expense: -Holiday Tree Lighting $4,200 -Employee of the Month $ 300 -Volunteer Banquet $4,500 -New Citizen Packet $4,000 -Office supplies have increased due to printing of visioning report and the visioning program itself. (There is no longer a separate visioning budget) -printing $2,500 -graphic design $2,000 -office supplies $ 800 -copies $ 200 -refreshment $ 470 (task meeting & open house) -outcome measurement training $8,500 (benchmarking) -Travel/Training increase is due to Bill Monahan and Liz Newton's attendance of ICMA conferences and training for the new Volunteer Coordinator. The conferences are alternated each year between the East Coast and the West Coast. This year's conferences will be held on the East Coast. -Upgrade of Code Master software. Human Resources -No additional staff -Prof. & Contract Services increased due to: general training, EAP, workplace violence training, the labor attorney and city attorney fees. -Special department expenses went up due to H/R's employee of month and recognition programs and putting on the Wellness/Benefits fair. -Office Supplies increase reflects the redesign of the new employee packets, forms copying, identification badges and the processing of recruitment notices. -Computer Software has increased because HR wants to purchase two software programs; Organization Plus and Performance measures. Bill stated that the HR budget has increased by about $21,000 due mainly to the Prof. & Contract Services and Travel/Training Expenses. Max Williams asked what caused the large increase in the Travel &Training expense in 1995/96. Bill responded that the new HR director started that year and did some restructuring of staff and provide more training to all City employees. 8 Risk Management A second employee was hired and is working out very well and will be able to grow within the salary range. Training expense has increased because Risk is offering a citywide training program. The training provides employees with information regarding safety issues. Also, the new staff person needs training. Increases in the Insurance line item of about $46,000 is due to increases in insurance costs and that the City changed carriers. Max Williams asked why the City changed carriers? Bill stated the change was made not just because of rate issues, but also the level of coverage and types of coverage being offered and corporate philosophy. The City switched from an insurance carrier to an insurance pool. Ken Scheckla questioned why fees and dues went down? Bill responded that the amount went down because employees can get the newsletters and subscriptions via the Internet instead of having them mailed. Bill noted that the Risk budget covers not only insurance and worker comp costs, but also the City's involvement with solid waste and special projects done throughout the City. The Risk Assistant works primarily on Worker's comp claims and safety issues. Bill stated that the State offers a reimbursement program to agencies that bring worker comp employees back to work early to do light duty tasks. Bill noted, for the first time, the City was able to participate in this program and it is largely due to the efforts of the new Risk Assistant, Gary Smalling. Gene asked how did asking Department Head's to decrease materials & supply by 10% work out? Bill stated that it worked out pretty well and the departments held to it and found that they could make do with less. Wayne stated some things that were cut out came back to Council as budget adjustments after the budget cycle. Gene asked if Measure 47 was the reason for the cut? Bill stated it was a response to the Measure. Finance: Wayne Lowry, Finance Director, presented his department's budget which starts on page 149. Wayne stated that the Finance budget is made up of five budget units and twenty individuals. Wayne noted that Finance is requesting 1 new FTE for the accounting section. No one has been added since the early 1990's. In 1993, the Accounting section was downsized during its merger with the Water District (5 positions went down to 3). The new position will be responsible for Business Tax and will assist the City Buyer. When a temporary was hired for this position last year, the City found over 900 potential 9 business that were not being taxed. The City increased its revenue by $40,000 to $50,000. This position will allow the City to keep business taxes current and ensure that businesses are zoned appropriately before they establish themselves to minimize legal disputes and cases going to Municipal Court. Wayne asked if anyone had any questions on the Finance Budget? None of the Committee members had questions. Accounting Department -Computer Software line item increase of$54,000 is due to new computer software for utility billing and to finish implementing this year's budgeted finance package. The upgrades will allow the software to be 2000 compatible. This cost also includes training that will be necessary. Ken questioned why retirement was down and group insurance was up? Wayne responded that it was an error and they were mis-grouped. Administrative Services -Consists of 3 units—Total increase is 12.5% -Office Services -Records -Municipal Court Office Services Office supplies increased due to postage for Cityscape which is 12 issues a year. Records The cost of records storage has increased due to not being able to use the Canterbury Water Building (old shop) for storage due to safety issues. Gene asked what is the bulk of the City's records? Wayne stated that the bulk is planning files, permits, etc. A lot of them have to be kept on paper for a long period of time before they can be put on microfilm. The additional money is being set aside in case the City has to rent storage. Municipal Court Increase of 18.4%; the majority of this increase is due to the City Attorney fees being distributed across all budget categories. Wayne noted that Municipal Court is using a collection company to collect unpaid traffic fines. Prof. & Contract Services portion is $7,800. George questioned the level of standard on page 151. He asked how is the City doing as compared to the standards for investment rates and debt rates? Wayne stated the City routinely beat the state pool because it has become more active in the investments. About half of the City's portfolio is invested in Treasury Securities or Agency Securities which generally beats the pool. 10 Wayne stated that the City's debt is as low as can be at 4% to 5%. Wayne also stated that if anyone has any questions this week feel free to call or fax Wayne or Bill. Next Weeks Agenda Jim Hendryx - Community Development Ed Wegner - Public Works (7-8 units) General CIP (majority of these are Public Works related) p. 177 The Budget Committee was concluded and discussions will continue at the May 11, 1998 meeting. MSP