05/01/2000 - Minutes City of Tigard, Oregon
Revised Budget Committee
Meeting Minutes
May 1, 2000
Members Present: Mike Benner, George Burgess, Craig Dirksen (arrived late),
Gene Farnstrom, Brian Moore, Jim Nicoli, Ken Scheckla (arrived late) and Joyce
Patton.
Members Absent: Paul Hunt and Darlene Stevens.
Staff Present: Paul deBruyn, Tom Imdieke, Bill Monahan, Craig Prosser and
Michelle Wareing.
Visitor: Glen Scruggs
Call to Order: Gene Farnstrom, Chair, called the meeting to order at 6:40pm. All
members were present except Craig Dirksen, Paul Hunt, Ken Scheckla and
Darlene Stevens.
Ken Scheckla arrived at 6:50pm and Craig Dirksen arrived 7:10pm.
Elections: Bill Monahan, City Manager, stated that nominations need to be made
to elect a new Chair and Secretary. Jim Nicoli nominated Gene Farnstrom for
Chair. Brian Moore seconded the motion. All were in favor of the motion. MSP
Jim Nicoli nominated Mike Benner for Secretary. Brian Moore seconded the
motion. All were in favor of the motion. MSP
Budget Message: Bill Monahan presented the Budget Message for the 2000/01
budget.
Bill highlighted the major issues facing the City in FY 2000/01. The City will need
additional staffing due to the annexation of the Walnut Islands, which added an
additional 1,100 new residents.
Another issue is a downturn in building activity over the last 8 to 9 months, which
has affected the building department funds. The proposed budget includes the
elimination of three vacant positions in the Community Development department.
It is anticipated that there will be a reduction in revenue. The City is looking at
building fee increases, which will go to Council in June or July. Bill noted that
building activity has begun to increase, so the downward trend maybe reversing
itself.
Bill stated that a new item in the budget this year is the Library construction
reserve. A Library Construction Committee was created to design a new Library.
The Library received two bequests over the last year totaling $850,000. The City
is proposing to set aside those funds with an additional $400,000 transfer from
the General Fund. This reserve will be used for hiring an architect to do design
work and any startup costs. The City is deciding whether or not to go to the
voters in November 2001 to fund the Library construction.
Bill stated that there are several changes in the water supply options. The City
has decided not to pursue the Willamette River as a water source at this time.
The City is considering purchasing water from the Joint Water Commission or the
South Fork Water Board along with continuing to examine the Portland option.
Any of these options will require an increase in water rates. Bill noted that the
Intergovernmental Water Board is currently considering these increases.
The total operating budget increased only 1.9% over the adopted FY99/00
budget. This includes a total net increase of 2.05 FTE positions. The Police
department is adding 2.5 positions — 1 to maintain staffing, .5 for the photo radar
program, and 1 to serve the Walnut Island areas. The City is establishing a
computer system reserve. These funds will be used to better budget major
software program conversions and upgrades. There are two other General Fund
transfers, one of$150,000 for City building improvements and the other for
$10,000 to the Electrical Inspection Fund. Bill noted that staff has tried to reduce
spending in the General Fund, so money can be set aside for the above
mentioned reserves.
Visioning Statements: Bill stated that the City started the Tigard Beyond
Tomorrow visioning program a few years ago. The City has begun to reference
how City programs/activities connect to the Visioning statement. The FY 00/01
includes more performance measurements that quantify the City's activities and
shows that the City is meeting the Visioning goals.
The six target areas set by the Visioning program are Public Safety; Urban and
Public Services; Transportation and Traffic; Community Character and Quality of
Life; Growth and Growth Management; and Schools and Education.
Council Goals: Bill stated that Council goals are located on page 3. Many
elements in the budget are reflective of these goals. Bill noted that Council
carried over its goals from FY 99/00 to FY 00/01 and did not add any new ones.
Gene Farnstrom asked if the Council goals were in order of priority. Bill
responded that they were all of equal value and were not in priority order.
Jim Nicoli stated that Council had decided to apply for a parks grant at its last
meeting. Jim stated that he would like to discuss this issue at the next Budget
Committee meeting, since it may affect the budget.
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Craig Prosser noted that the City is in the process of changing its performance
measurements. Currently, performance is based on workload processes and
how many functions are being performed. FY 00/01 budget mostly shows these
types of measurements. However, next year's budget will include effectiveness
measurements. Effectiveness measurement shows how well the departments
are doing at achieving their goals.
Mike Benner asked who set the department's benchmarks. Craig P. responded
that each department sets its own benchmarks. Craig P. noted that he reviews
the department's benchmarks and makes recommendations.
Mike asked if the departments are rewarded for achieving their goals. Craig
responded that the departments are not rewarded beyond a "job well done".
Financial Plan: Craig Prosser presented the City's Five-Year Financial Plan.
Craig P. stated that the City puts together a financial plan that forecasts its needs
for the next five years. This Plan is revised each year due to project program
changes and department input.
The General Fund Five Year Forecast Summary is located on pages 18 and 19.
The Summary on page 19 shows that the Ending Fund Balance is projected to
decline over the next five years. This decline was expected given the new tax
revenue limitations.
Craig P. noted that this year the City's other funds were reviewed to determine
their condition. The Water Fund balance is projected to decline over the next five
years. It is currently at $2.3 million and will drop to $1.3 million in five years. The
two factors affecting this fund balance is a transfer of money from the Water
Fund to the Willamette River CIP Fund, which is now the Water CIP Fund, and
the other is peaking charges charged by City of Portland this last year. The
decrease in this fund is the reason why the water rates need to be increased.
The Storm and Sewer Funds are strong and will increase over the next five
years.
The Development Funds, which includes building, electrical inspection and urban
services, are in a precarious state. A transfer of$150,000 will be made in FY
99/00 to the Building Fund to keep it positive. A transfer of$10,000 will be made
in FY 00/01 to the Electrical Inspection Fund to keep it positive. The City is
talking to Washington County to receive more money for the Urban Services
Fund.
Jim Nicoli stated that if building activity outside the City is strong, then the Urban
Services Fund should be okay. Bill Monahan responded that building activity is
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not as strong as anticipated and that the annexation of the Walnut Island takes
away from the Urban Services revenues.
Craig P. reiterated that the General Fund's outlook is reasonably okay and the
Development Funds need immediate attention.
A discussion regarding the water rate increase ensued. It was stated that the FY
00/01 budget includes a water rate increase of 3%. It is anticipated that another
increase of 10% will be proposed after a rate study is completed and depending
upon the outcome of the Taxpayer Protection Initiative that will be voted upon in
November 2000.
Upcoming Ballot Measures: Craig Prosser stated that there are several
measures on the November ballot that could affect the City, if they pass. The
first is a measure regarding the.deductibility of federal income taxes on state
income taxes. This measure will primarily affect the State. However, the City
receives State Revenue Sharing funds, which could be impacted, if the State has
to cut back.
Another measure, which is sponsored by Don McIntire, would limit the rate of
increase of government spending to the rate of increase of personal income.
Craig P. stated that he was not sure if this measure applied only to the State or
all government agencies. Even if the measure is limited to the State, it would still
impact the State Revenue Sharing funds that the City receives.
The third measure is the Taxpayer Protection Initiative. This measure would
prohibit increases of taxes, fees or charges greater than the rate of inflation
without a vote of the people. Also, any future request for increases would have
to pass by the same majority or greater than the Taxpayer Protection_Initiative
passed. This measure is retroactive back to December 6, 1998, which means
any increases to taxes, fees or charges beyond the allowed limit would have to
be refunded to the payer with interest. Finally, this measure would require any
future ballot measure requests to increase fees or charges to start off stating "A
yes vote on this measure is a vote to increase taxes". This applies even if it is an
increase that doesn't increase taxes.
Craig P. stated that General Obligation bonds authorized prior to November 2000
are exempted. However, bonds on the November 2000 ballot are not exempt.
The Taxpayer Protection Initiative would require that the total estimated costs of
the bond be included in the bond measure. This means interest rates would
have to be estimated over the life of the bond. This provision would have a major
impact on all future bond measures, including the City's proposed transportation
bond that will most likely be placed on the November 2000 ballot.
A discussion regarding the Taxpayer Protection Initiative ramifications and its
potential affect on local governments followed. Craig P. noted that even though
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the measure has not formally been put on the November ballot, but likely will be,
it is already affecting cities' decisions regarding fee increases, bonds and other
financial decisions.
Budget Summary: Craig Prosser presented a brief overview of the budget. The
Operating Budget for FY 00/01 is up 1.9% and includes 2.05 FTE net new
positions. Several departments including Police, Finance, Library and Water are
adding new positions, while Community Development cut 3 positions.
Craig P. stated that the budget did not include any operating property tax
increases. However, the budget does include a 3% water rate increase with
another potential 10% increase and a potential 51% Building Fee increase.
The Police Department budget includes 2.5 new FTE positions. One position will
serve the Walnut Islands and the other will maintain staffing ratios. The .5 FTE
position is for the Photo Radar enforcement program. The Police budget
includes $228,000 to pay the vendor of the photo radar equipment. The vendor
receives a percentage of revenues from citations issued. Craig P. noted that the
$228,000 is an estimate and that the program won't start until September.
Craig P. noted that the City just received a grant to fund a third school resource
officer. This position is not included in the budget at this time.
Brian Moore asked if the grant was for one year. Bill Monahan responded that it
was a multi-year grant and that when the grant runs out, the Tigard-Tualatin
School District has agreed to fund half the position for the nine-month school
year. Bill noted that this is the first time the School District has agreed to assist
in funding the School Resource Officer program.
Library is maintaining programs at the current level. FY 00/01 budget does
include an additional .3 FTE positions for Volunteer support and computer
services. The major event in the Library budget is the $400,000 contribution to
Library construction reserve.
Community Development budget includes a reduction of 3 FTE positions, which
was discussed earlier. There are planned fee increases for FY 00/01.
Water budget contains a 3% rate increase as recommended by the
Intergovernmental Water Board, which was discussed earlier. There is a new
Water Conservation position and a Utility Worker position was transferred to
Finance's budget. This Utility Worker position performs turn-ons, turn-offs and
service orders for the Utility Billing division, which is part of Finance.
Finance's budget includes 1 FTE position that was added during FY 99/00, 1 new
FTE for Municipal Court to assist with the Photo Radar program and .75 FTE
Utility Worker position that was transferred from Water.
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Craig P. stated that citywide expenses that were appropriated in the General
Government budget have been reassigned to operating departments. Mayor &
Council, City Management and Property Management budgets have increased,
since they contain the citywide expenses.
Craig P. noted that Total Materials & Services and Total Capital Outlay have
slight decreases over FY 99/00. Capital Outlay decreases can be attributed to
the change in the amount considered to be a capital outlay, which was increased
to $2,500 per unit from $250 per unit.
Total Personal Services increase is due to the addition of new positions.
Major New Initiatives: Craig P. stated that the topics contained in this agenda
item have already been discussed during this meeting, therefore, he would not
review them again.
Bill Monahan stated that Paul deBruyn, Director of Network Services, was
available to discuss the computer systems reserve. The Committee decided that
it would wait until Paul presented the Network Services budget at the next
meeting.
The Computer Systems Reserve prompted a discussion regarding the City's web
page, need for system upgrades and the use of computer technology to reach
more citizens. Jim Nicoli expressed concern that the City was not keeping up
with technology and wasn't fully utilizing the full potential of the web page and
Internet. Bill Monahan noted that the City is trying to make the web page better
by putting GIS maps, forms and the Development Code on-line.
Jim recommended hiring a private web page consultant to review the City's web
page and provide recommendations to improve it. The City should consider
putting money into the budget to pay for this consultant. Craig P. stated that he
would try to get some consultant cost figures for the next meeting. Gene
Farnstrom stated that the City should have defined goals and expectations
before hiring a consultant.
The Committee agreed that the City needs to become more technologically
innovative in reaching its citizens. Bill Monahan noted that the City Council
would be hearing a staff presentation on Tuesday, May 16 regarding the City's
web page and computer technology. The Committee was invited to attend this
meeting.
Public Comment: There was no public comment.
The Budget Committee was concluded at 8:OOpm and discussions will be
continued at the May 8, 2000 meeting.
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