05/02/2005 - Minutes City of Tigard, Oregon
Budget Committee
Meeting Minutes
' May 2, 2005
Members Present: Mike Benner, Craig Dirksen, Mark Haldeman, Sally Harding, Katie Schwab, Sydney
Sherwood, and Susan Yesilada. Nick Wilson arrived at 6:33 PM.
Members Absent: Tom Woodruff
Staff Present: Margaret Barnes, Roger Dawes, Maureen Denny, Jaime Dumdi, Gary Ehrenfeld, Tom
Imdieke, Dennis Koellermeier, Liz Newton, Craig Prosser, and Michelle Wareing.
Visitors: Martha Bishop, Gretchen Buehner, Henrietta Cochrun, Janet Goetze, and Jason Snider.
Call to Order: Mark Haldeman called the meeting to order at 6:30 PM.
Approval of Minutes: The meeting minutes of April 25, 2005 were approved. MSP
Introductions/Housekeeping: Mayor Dirksen introduced Jason Snider to the Budget Committee. Irene
Moszer's resignation has left a vacancy for a citizen budget committee member. Mayor Dirksen and Tom
Woodruff have interviewed new candidates. Jason Snider is their recommendation to Council to fill the
vacancy. It is anticipated that Jason will be officially appointed at the May 10, 2005 Council meeting.
Once Jason is appointed he will be a voting member of the Budget Committee, until then Jason was
invited to attend and participate in the meetings, but not vote, to become familiar with proceedings.
Tom Imdieke discussed the four handouts. The first is page corrections to the budget document due to an
older version being printed. The correction replaced pages 27-30 of the proposed budget. There were
Ifte three additional handouts, one explaining the forecasting process and the forecasting software that the
City uses in forecasting. The next handout addressed the General Fund analysis and the question
Councilor Woodruff raised at the last meeting. The last handout addressed the impact of Materials and
Services. Tom Imdieke encouraged the Board to review the materials and bring any question to the next
budget meeting.
City Administration: Liz Newton,Assistant to the City Manager, presented the Committee with the City
Administration Department budget which includes the Mayor and Council, City Management, Human
Resources, Risk Management, and Information Technology(IT)divisions.
Liz pointed out the increase in FTE by 1.0 is due to a transfer of a position from Public Works to the IT
Division. This is not an added position and the corresponding reduction will be seen in the Public Works
budget.
Mayor and Council. The Mayor and Council represent the legislative and policy leadership for City
government. They are elected officials. The City Council is responsible for hiring the City Manager. The
Mayor and Council focus primarily on working to accomplish the goals of the Council and provide
direction to the staff.
The proposed budget includes funds for three Councilors to attend the National League of Cities
Conference this year in Charlotte, North Carolina. The Council has asked the Committee to look at
replacing this with the Congress of Cities held in Washington, DC in the spring. The substitution would
increase the expense for three Councilors by$700. If four Councilors attended the cost would increase
by$3,000 and for five participants the total increase would be$5,400.
The budget reflects a slight increase in Fees and Dues as the League of Oregon Cities dues have
increased.
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City Management:The City Management Division consists of the City Manager and staff supporting the
activities of the City Council. A major focus of this Division is on communications citywide.
The Division is looking at increasing the number of Cityscape issues from 9 to 12. The workload
measures on page 182 do not reflect the increase and will be corrected for the Adopted Budget. "
The Volunteer Coordinator position will be changed to a Program Development Specialist. City
Administration is looking at moving the volunteer coordination into the Departments, such as the Library
and Public Works. This position will oversee the volunteer programs; develop citizen participation
programs, and internal programs as directed or needed.
Personal Services shows a significant increase in FY 2004-05 due to the severance package for the City
Manager who left in January and recruitment expenses for his replacement. Professional and Contract
figures are down as the need for a temporary replacement for the City Recorder is not needed in FY
2005-06. Other increases are for Citizen Leadership program, increase of the number of Cityscape
issues, and increase of ICMA dues. The Travel and Training includes funds to send the new City
Manager to the ICMA conference.
Councilor Sherwood questioned the elimination of the City Recorder from City Management. Liz
explained this position has moved to Office Services. Liz also clarified the transfer of the position from
Public Works is to IT and not City Management. This position handles card lock security, building security
done by the computer, and can also provide back up for the communications system. Councilor Harding
asked if the new Program Development position would be an increase in pay. Since the person left the
position had been at the top of the scale the cost would be lower initially. Technically, it is a higher
classification, but it would not increase the budget for several years.
Liz stated there is a request from Councilor Harding for software. The staff is looking at funding it in the
current year and will be putting together a memo for the Council to see if other members want to take
advantage as well.
Human Resources: This Division provides human resources management to the City, primarily
recruitment, benefit administration, and compliance with employment laws.
There is no increase in staffing for the Division. There is a significant decrease in Professional and
Contract services as both of the new providers for the employee assistance and flexible spending
accounts programs are significantly less expensive.
Human Resources'Travel &Training line item includes costs for citywide training. This amount stays
about the same as the previous year. Councilor Sherwood asked what the significant change was from
FY 2003-04 and FY 2004-05. Craig Prosser explained in previous years the City planned for citywide
training, but did not offer it. The Division has budgeted more this fiscal year and would like to continue at
a higher level. The types of training include supervisory training and sexual harassment training that is
not department specific. Mark Haldeman noticed an increase in the total numbers of employees
attending training. This is due to the increase of training sessions offered.
Information Technology: This Division provides support for all of the City's technology. It includes
computer systems installation and maintenance, cell phone management, telephone services, and the
cable television service provided.
There is a position increase of 1.0 FTE which was discussed earlier. This is the transfer from Public
Works to IT. Professional and Contract Services show a decrease for technical support for citywide
equipment. The funds are there if needed but it is not always necessary to use the full amount. Small
Tools & Equipment shows an increase for network switches. Fees, Dues, and Subscriptions includes the
new licenses, however the increase is due primarily to the Portland Police Data Systems (PPDS)
connection. The line item for Computer Software is for new network licenses and upgrades.
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Risk Management: Risk Management provides insurance and manages the City's safety program. The
City has received another gold medal from the League of Oregon Cities for its safety and risk
management programs.
There has been an increase in insurance costs due to the market and increase in property insurance due
to expanded City facilities.
The first Technical Adjustment on the list addresses the Travel and Training costs for City Council to
attend the Washington, DC conference, possibly sending additional members. The Mayor stated he
would be interested in the citizen members'views on this subject.
General Government: This program includes the City Attorney and Technology.
City Attorney: Liz presented the City Attorney portion of the program. The City contracts with private firms
to provide legal services including legal advice, support, and policy review.
In January 2006, the City will begin negotiations with the Tigard Police Officers Association (TPOA)
resulting in an increase in expenses for Professional and Contract Services. Mark Haldeman asked
about last year's negotiation with the TPOA. Craig Prosser stated that last year the City was in
negotiations with TPOA and SEIU. The City reached settlement with SEIU on a three-year contract. The
City was unable to reach settlement with TPOA and under state law went to binding arbitration. The City
lost the arbitration and TPOA was awarded their requested contract which was a two-year contract. One
of the issues in the TPOA negotiations was in the employee portion of the health insurance premium. For
TPOA members, the City pays for 90% of the health insurance premium. For all other employees, the
City covers 79.4%of the cost.
The question was raised for having a staff attorney versus contracting an outside firm. Staff has
completed an analysis comparing costs based on other local governments and has arrived at a figure of
$316,000. The cost includes salary plus benefits for an attorney of$135,000, salary plus benefits for an
administrative support person of$68,000, contract for a labor attorney for$89,000 (which is built in to the
proposed budget), approximately$15,000 for other services for specialty legal work, and Materials and
Services. This is about$82,000 more than what is budgeted for outside attorney in FY 2005-06.
Councilor Wilson asked how many FTEs would the billable hours represent. Roger Dawes estimated
about 75-80 bi-monthly but offered to do further research. Tom Imdieke stated that the drivers for the
FY 2005-06 budget are the Comprehensive Plan Update, Urban Renewal, and the TPOA negotiations.
The current contract expires with the existing contracted firm in October and this is a timely topic. Craig
Prosser stated there are pros and cons for in-house versus contract and it is a policy choice for the best
way to obtain legal services for the City. Councilor Harding asked if an in-house attorney's duties could
cross-over into other areas. Based on discussions with other cities, this is really not the case. Some may
handle the prosecutor work through the Municipal Court; currently this service is contracted out.
Councilor Harding mentioned the LOC has attorneys available as a resource; however, they are limited to
the service they can provide. The decision was to leave this off the issues list and proceed as proposed.
Technology:Gary Ehrenfeld, Director of Information Technology, presented the budget for Technology.
This budget is used to purchase new hardware and software identified during monthly meetings with
Directors, Executive Staff meetings, and the City's User Group. The User Group reviews the requests
and prioritizes the need for software and hardware.
The Office Supplies is actually the hardware and has decreased from last year as the request from the
Departments has decreased. Dues, Fees, and Subscriptions have increased due to the three major
systems the City uses for Finance, Permit System, and Public Works. Computer Software has increased
due to the additional Hansen Pavement modules for Engineering. Other software packages are for Risk
Management, sketching software for the Police Department, Crystal Reports, AutoCAD, and Engineering
Pavement Management. This is strictly all new programs; the upgrades for software are reflected in the
IT budget. Sue Yesilada asked if the level of funding is expected to increase going forward. Gary stated
that IT just finished an audit of its licenses and identified the need for additional licenses in FY 2005-06.
Next year should be significantly lower. In 2003-04, the decision was made to computer hardware and
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software costs out of the IT Division budget and into the newly created Technology Division. This was
done to better track the Departments request and expenditures.
Public Works: Dennis Koellermeier, Public Works Director, and Jaime Dumdi, Management Analyst for *000
Public Works, presented the Proposed Budget for Public Works.
Dennis stated that he wanted to talk about expenditures, revenues, technical adjustment, and four issue
papers. The Public Works budget and the issues are directly tied to this year's Council goals, including
the acquisition of additional park land. The overall mission of Public Works is to provide public
infrastructure, recreational, and environmental services essential for community living. The Department
maintains and operates all of the City's major infrastructure systems including parks, streets, sanitary
sewer, storm sewer, water system, City facilities, and the City's fleet. The Department has recently
adopted a motto, which is"Taking Care of Tigard".
The Department is funded from storm and sewer charges, water sales, gas tax, property tax, and General
Fund. A little over 11% of the Public Works program is supported by the General Fund.Additional
revenue forecasted is in two areas. A proposed water rate increase of 7% is estimated to generate
$435,000 a year in revenue. The other adjustment is in the Park Reservation fees. This is the second of
a three-year rate phase in program. The first year, the Department has brought the program into the
black.
The total Public Works budget is$10.8 million, which is approximately 33% of the entire City budget. The
Department has 62.0 FTE which reflects a decrease. This was due mainly to the unsuccessful
negotiation of taking over expanded services from Clean Water Services (CWS).
Public Works Administration: The total budget is almost$760,000 which is up from last year by 19%.
There was a transfer of.25 FTE back to the Water Division. The Department is currently in the first year
of its Citizen Emergency Response Team (CERT) program. The program trains citizen volunteers in basic
search and rescue and triage. Currently, there are 30 trained volunteers and it is planned that an
additional 20 will be trained in FY 2005-06. The Department has introduced a customer satisfaction
survey as way to measure public satisfaction with Public Work's crew response. There has been a very
positive feedback from the citizens with a 96%satisfaction rate.
Public Works has applied for a grant to upgrade some of the emergency radio communication equipment.
This has to be budgeted as an expense of$68,000. There is also a new membership with three other
local agencies which is called the Office of Consolidated Emergency Management. This will provide a
higher level of emergency management expertise.
Parks and Grounds:This is predominately funded by the General Fund. This year the budget is just over
$1M and reflects a 4.9% increase. Parks has 10.75 FTEs which remained the same from last year. There
was discussion of adding one FTE but was decided to use the funds for seasonal employees. This is
necessary for the additional days and higher usage during the summer season. Dennis stated that Parks
is experimenting with contracting out some services that had been done in-house. Currently, the City has
a contract for maintenance for all of the grounds for the Library,Water Building, and City Hall. Mayor
Dirksen stated he was pleased this topic had been brought up and would like to explore this option further
for other purposes. Councilor Wilson has spoken with a manager from a firm that maintains medians in
Lake Oswego and was told landscapes can be maintained for 7-8 cents per square foot.
Storm Sewer.- There is about an 8% decrease in the budget mainly resulting from the CWS expansion
not happening. The Division is in the process of filling a vacant supervisor position and it is expected to
that the position will be filled by the end of the fiscal year. Some of the major expenses include replacing
a backhoe and a TV van, which are on a replacement schedule. There is also one new vehicle
scheduled for purchase. The Division is pretty aggressive on their maintenance and it pays off in less
claims. . Katie Schwab asked for clarification for the Professional and Contract Services increase in FY
2004-05. This was a one time expense for the Master Plan and also the transfer the street sweeping
expenses to the Storm budget from the Street Maintenance budget.
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Sanitary Sewer. The budget shows a decrease of approximately 26%. This is also due to the CWS
expansion take over not happening. The budget includes an additional day for the leaf collection
program, from two to three days. The program is very popular and cost effective. It is done in conjunction
with a canned food drive and is partially manned by volunteers. The Division is also expanding its
surface water quality education program.
Streets: The budget is up 1%. The Division has eliminated a vacant position. This Division provides
prime subcontracting opportunities. Approximately 34% of Materials and Services budget is for
subcontractor work and it is expected that subcontracting work will increase. The Division is evaluating
services such as Right of Way(ROW) mowing and has renewed the contract. Councilor Sherwood asked
why the fuel costs have decreased with the price of fuel on the rise. Jaime Dumdi explained they have
refined the process of estimating fuel and feel they have a more accurate number. Dennis noted in FY
2004-05 fuel costs were over budgeted. Crack sealing is also being contracted out. Dennis states they
get more crack sealing for the dollar by contracting this service out. Another factor increasing the budget
is the need to upgrade signage to meet the new federal signing standards.
Fleet Maintenance:The costs have been declining by approximately 25% by contracting out services.
Because they have contracted services they have been able to eliminate a vacant mechanic position, but
are adding .5 FTE administrative support position.
Property Management: The budget has increased by 13%. Part of the increase is due to higher energy
costs. The contract for janitorial services is up due to underestimating from last year. In addition, this will
reflect a full year of utility and janitorial costs for the new Library.
Water: No significant changes in the budget for Water. The FTE is up by.25 due to a transfer from
Public Works Administration to Water. Of the$5.2M budget, $3.5M will be used to buy water. Other
aspects of the Water budget that have changed from last year is the Aquifer Storage and Recover(ASR)
well. The well is transitioning from an experimental phase to an operational phase. Energy costs are up
in the budget. Two major pieces of equipment are scheduled for replacement.
There is one technical adjustment to the FY 2005-06 budget. The ASR#2 project was scheduled to be
completed by 6/30/05. There were some unexpected design issues. The good news is the well will be
able to pump 2.5M gallons per day instead of the 1M gallons as originally planned. In order to
accommodate the higher flow rate additional changes are necessary. By taking advantage of the higher
flow rate, construction completion will be delayed until fall; however, it will be on schedule for injection this
winter. Due to the unexpected design issues, it is estimated that the cost will be$1,048,500. The current
CIP doesn't include any funding for this project in FY 2005-06. In FY 2004-05, there is about$720,000
budgeted for the ASR#2 well. Since design and construction is behind schedule, $400,000 needs to be
carried over. This$400,000 is included in the total need for FY 2005-06 of$1,048,500. This issue will be
discussed in more depth at the CIP budget presentation on May 16th's budget meeting.
Issue Papers: Dennis presented four issue papers to the committee.
#1: Recreation Grants—This is in response to a request from the Parks and Recreation Advisory Board
(PRAB)and citizens responding to a Parks and Recreation Needs survey. This would provide funds for
certain agencies and schools to help provide recreational opportunities. The funds have not been
included in the FY 2005-06 budget due to limited funding. If the Budget Committee wishes to fund this
program, it will need to shift funds from other programs to come up with $25,000 per year for recreation
grants or would need to draw down fund balances. Recreation Grants was added to the Technical
Adjustment list for further discussion. These grants would be funded by the General Fund.
#2: Right of Way(ROW)Grants—At the request of the Council, this program will provide funding to assist
citizens enhance ROW maintenance on major arterials and collector streets. The funds would be
provided to property owners who demonstrate a financial or physical need to assist them in
enhancements/clean up. The ROW grant program is not included in the FY 2005-06 budget. If the
Budget Committee wishes to fund this program, it will need to shift funds from other programs to come up
with $25,000 per year for ROW grants or would need to draw down fund balances. ROW Grants was
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added to the Technical Adjustment list for further discussion. These grants would be funded by the Gas
Tax Fund.
#3: Water Rates—Water Rates are the primary revenue source of the Water Fund. In FY 2004-05, water
rates are anticipated to account for over 90% of Water Fund revenues. To assist the City in its analysis of
annual revenue requirements, a financial model was developed. This tool allows the City to forecast
expenditures for up to 20 years in advance, which allows revenue need projections to be developed.
Another section of this model projects rate adjustments needed to meet the cash flow needs determined
by future financial obligations.
Analysis of the water rate model suggests substantial water rate increases lie ahead, as Tigard makes
decisions on a water source and builds the infrastructure to deliver it. It is projected that Capital Projects
in the future will be from $40M-120M. Based on this, Public Works and Finance staff collectively
recommends a 3 year rate adjustment package, adjusting rates 7%each year for three years. It is
estimated the rate increase will generate an additional$400,0004500,000 annually. The rate increase
will first go to the Water Board and then the Council. This matter is not up for decision at this time.
#4: Parks Funding—The goal is to provide 11 acres per thousand residents, currently there are 8 acres
per thousand. By the end of FY 2004-05, there will be a fund balance of approximately$2.2 million in the
Parks Capital Fund. Of this total, approximately$1.9 million will be SDC revenue. The remaining amount
will be non-SDC revenue. The SDC revenues of$1.9 million will be transferred to the newly created Park
SDC Fund in FY 2005-06. This will allow for better tracking of SDC revenues. All project costs will be
budgeted in the Parks Capital Fund and SDC revenues will be transferred into the Parks Capital Fund to
cover the costs of those projects that are SDC eligible.
The challenge for the City is to identify and secure the required non-SDC funding portion for land
acquisition and development projects. SDC funds may not be expended without the corresponding non-
SDC portion. Currently, the only non-SDC funds available are from the General Fund. In FY 2005-06,
the General Fund will transfer about$770,000 into the Parks Capital Fund to pay for the non-SDC
portions of projects planned for FY 2005-06. However, the General Fund is not a reliable source of
funding for the long term because each year there are tremendous demands for General Fund dollars to
fund the many and varied needs of the City.
No action is recommended at this time. The Department will continue to evaluate all external funding
sources and position the City to be able to leverage them.
Craig Prosser added that the purchase of park land is in the City's Capital Improvement Plan which will
be presented on May 16`h. The proposal will allow the City to take first step towards meeting the
community's desire for more park space In addition to land acquisition, the development of the land is an
issue. Development is funded by both SDC and non-SDC funds. Once land is developed, it must be
maintained. Park maintenance is funded by the General Fund, which as stated previously, does not have
a positive, future outlook.
Mayor Dirksen would like to have citizen input to help Council decide on revenue options, whether it
would be to raise taxes or lower service levels.The decision should be based on a recommendation from
the citizens for long term stabilization of the General Fund Balance.
Library: Margaret Barnes presented the Library's Proposed Budget. The Library consists of four
divisions—Administration, Readers' Services, Technical Services, and Circulation. The new Library has
been very successful as a whole.
Administration, Technical Services, and Circulation budgets show small increases in Materials and
Services.
The Materials and Services in the Library Readers' Services reflect the purchase of books, audio books,
and DVDs. The book budget is up to maximize the WCCLS formula. For every dollar the City spends on
books,WCCLS will reimburse dollar for dollar in the next year. The facility has grown from 13,000 square
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feet to 48,000 square feet and is considered a 20 year facility. Based on the survey results, citizens
requested more books and more hours. FTEs will increase by 1.5 to meet the demand.
Katie Schwab asked if the survey asked if patrons would be willing to pay for additional services.
Margaret stated there were no finance type questions.
Mike Benner asked about the use of volunteers in the Library. The Library has a very successful
volunteer program with about 200 volunteers per month. This is the largest volunteer effort in any of the
City. The hours work equate to approximately 6-8 FTEs.
Mike Benner also asked if the number of patrons had increased. A comparison from January to March
2005 and the same period in 2004 showed an increase of 35%. Sunday has shown to be a very popular
day with patrons, with over 4,000 visitors and 9,000 check outs in seven Sundays. The Library is also
issuing 700-800 new cards per month.
Issue Paper:
#5: Library Operational Hours—During the first six months of operation in the new building, the library
experienced dramatic increase in use, despite the reduction in hours. The library and the City received
numerous comments/complaints about the library being closed on Sundays. Some patrons were
understandably upset that just as the City opened a new library strongly supported by Tigard voters, it
became more inconvenient for many of them to use the library.
In the Library's 2005 annual survey conducted in February, 71% of the respondents requested that the
Library be open on Sundays. In addition, when asked an open-ended question about what one thing
they would change about the new library, the#1 response (498 people)was for the library to be open on
Sundays.
Because of the popularity of Sundays at the library, the FY 2005-2006 budget was adjusted to allow the
library to remain open on Sundays with a skeletal staff. When the Council approved re-opening on
Sundays, some Councilors expressed concern about re-opening for four months not knowing whether
funding would exist for the next fiscal year.
Because of these concerns and the enthusiastic response of the public to Sundays, the Library has
readjusted its budget priorities to allow for Sunday hours. Although staffing will be stretched to allow this,
staff believes that the public would prefer the library to be open on Sundays even if it means longer lines
or reduced service.
Making it more convenient to use the Library has introduced more people to the programs and services it
offers, thereby increasing library use. Our funding from the county is impacted by the level of library use.
Therefore, the Library recommends the approval of the personal services budget to maintain Sunday
hours.
Public Hearing on State Shared Revenues: The Chairman opened up a Public Hearing to receive
public testimony on the proposed uses of State Revenue Sharing Funds as mandated by state law. It
was explained that the City anticipates receiving about$288,659 this next year and that traditionally these
funds are placed in the City's General Fund and are used for programs funded by the General Fund. No
public testimony was received and the Chairman closed the hearing. The final hearing on State
Revenue Shared Funds will be held at the time of the final adoption of the budget.
Public Comment: There was no public comment.
The Budget Committee was recessed at 9:30 PM until May 09, 2005.
SOK
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