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03/25/1981 - Packet BUDGET COMMITTEE MEETING FOWLER JUNIOR HIGH SCHOOL LECTURE. ROOM MARCH 25, 1951 AGENDA: 1_. BUDGET MESSAGE - City Administrator 2. ELECTION OF BUDGET C014MITTEE OFFICERS (Chairman & Secretary) 3. CONSIDER SPECIAL REQUESTS Town & Country Days Chamber of Commerce Washington County Community Action Organization Shelter 4 . FEDERAL AND STATE REVENUE SHARING HEARING 5. REVIEW BUDGET COMMITTEE CALENDAR I..V MEMORANDUM March 25, 1981 To: City Budget Committee From: City Administrator, R. R. Barker We Subject: Budget 'Message and First Draft of the 1981-82 Tigard City Budget Attached for your review and consideration is the first draft of the proposed City Budget for the period July 1, 1981 through June 30, 1982. FO RHAT For the fifth consecutive year, the City will utilize a "program" type budget format as opposed to the "line item" type budget used in previous years. The "program" budget is a budget concept whereby budgetary estimates are broken down, arranged and presented by principal activities or functions rather than by organizational units without regard to the activities carried on by such units . The progran budget is viewed as a work program designed to accomplish desired objectives , thereby providing a closer linkage between planning and action and making the budget an integral part of the management process instead of just a presentation of a fiscal plan. ACCOUNTING BASIS The detailed and summarized financial information that follows was prepared using the "modified accrual" accounting basis which the City has been using since July 1, 1975. Prior to 1975 the City used the "cash" basis of accounting. TAX BASF The official tax base for the City is presently $223,793. In November, 1980, the voters approved a. new tax base in the amount of $562,098. This new tax base becomes effective July 1, 1981. TAX RATE The current City tax rate is $.60/$1,000 of assessed value. The official 1980-81 assessed valuation. for the City of Tigard is $490,359,257. 1t is estimated that the assessed valuation for 1981-82 will be $539,395,000. With a tax base. of $562,098 and an assessed valuation of $539,395,000, the 1981-82 tax rate would be $1.04/$1 ,000 of assessed value. The property taxes on a home assessed at $100,000 would be $104 . REVF,NUES The City will be relying upon essentially the same sources of revenue during the 1981-82 fiscal year as it did for the previous fiscal year. There is, however, one new source proposed and reflected in the budget, and some increases in existing sources are recommended and included as follows: New Source - City Staff is recommending the creation of a users fee to meet the maintenance and develop- ment needs of the City's storm drainage system. The recommended fee is $1.00 per month . Page 2 Existing Sources The following increases in existing revenue sources are reflected in this budget: (1) Sanitary sewer users fee is bing increased $.75/month by USA, and the -"" connection fee is being increased $50.00 per dwelling unit equivalent. Both are effective July 1, 1981. (2) Staff recommends an additional increase in sanitary sewer user fees in the amount of $.85/month (this is in addition to USA's proposed increase of $.75) to meet the maintenance and improvement needs of the City's sanitary sewer system. If implemented, the total users fee would be $7.60/month. (3) It is proposed that the public works inspection fee be increased from 1.5% of construction costs to 4.0% to cover the actual costs of inspections made by City public works personnel. Potential New Sources - There are at least two potential new sources of revenue for the City. One is the two-year serial levy proposed by Washington County, to be considered by the voters at the March 31 special election. If the measure passes, the City would receive an estimated $490,000 for street maintenance in 1981-82 (and the same amount in 1982-83) . The other possible new source is that of a cable television franchise. If the City awards a franchise to a cable TV company during the coming fiscal year, and the cable system becomes operational, we will receive a percentage of the company's gross receipts. The proposed budget does not reflect revenues from either of the above sources. In the event they materialize, the budget can be amended accordingly. rants - Funds from state and federal grants are expected to be $308,000 less than in the 1980-81 fiscal year. It is estimated that the City will receive grants totaling $66,250 during the next fiscal year for such projects as the construction of sidewalks and wheelchair ramps, and for the preparation of a downtown Tigard revitalization plan. Non-Property Tax Revenues - The total amount of non-property tax revenues anticipated by the City for the period July 1, 1981, through June 30, 1982, is $3,752,000 as compared with $4,009,000 estimated for the current fiscal year. This is a decrease of $257,000 or 6.4%. This budget reflects a greater use of Federal Revenue Sharing funds for capital outlay items and less reliance upon Revenue Sharing for general operating purposes. It should be pointed out that several revenue sources are based upon the City's popula- tion, and the Bureau of the Census population figure for Tigard is much lower than the one we used last year. Last year we used the population figure of 14,655, given to the City by Portland State University Center for Population Research. The figure we have been given by the Bureau of the Census is 12,500. We have challenged that figure and will soon be receiving a revised figure from the Bureau. For purposes of preparing revenue estimates for 1981-82, we have used the figure of 14,500 as Tigard's population. Property Tax Revenues - Revenues from the property tax are expected to total $274,000 for fiscal year 1980-81 includes $254,000 in current taxes and $20,000 in delinquent taxes for the City, "Tigard Community Youth Services and Loaves and Fishes) . ige 3 It is estimated that revenues from the property tax will total $644,000 for the 1981-82 fiscal year, an increase of $370,000 over the current fiscal year (includes $624,000 in current taxes and $20,000 in delinquent taxes for the City. Tigard Community Youth Service and Loaves and Fishes) . The large increase is due mainly to the new tax base approved in November, 1980. It should be pointed out that revenues from the property tax consitute only 14.6% of the total estimated revenues to be received by the City during the 1981-82 fiscal year. Revenues from all sources are expected to total $4,396,000 (includes Tigard Community Youth Service and Loaves and Fishes special levies) . EXPENDITURES Total expenditures proposed for 1981-82 amount to $4,396,000. This is a 2.2% increase over the expenditures budgeted for 1980-81 ($4,299,571) . The increase in total expendi- tures is due mostly to the following: 1. Salary increases required by labor contracts. 2. Increases in fixed costs such as utilities and insurances, and increases for materials and supplies such as gas, oil, asphalt, vehicle parts, etc. 3. Increase in TCYS and Loaves and Fishes costs. Capital Outlay - Proposed capital outlay items total $1,081,014 ($237,540 in the operating budget and $843,474 in the capital budget) . The major capital outlay items include the following: 1. Patrol cars (3 replacement vehicles) . 2. Street and highway development (extra capacity streets) . 3. Pickup truck, Public Works. 4. Equipment and materials storage building, Public Works 5. Self-propelled mower 6. Blacktop Roller 7. Vacuum Sweeper, Parks 8. Sidewalks and wheelchair ramps. 9. Improvements to storm drainage system. Personnel - The proposed budget reflects a net increase of 8.5 employees over the number employed by the City during 1980-81. Last year there were two less employees than in 1979-80. The majority of the proposed additional positions are in the public works area and have been recommended to provide better maintenance of parks, streets, sanitary sewers, and the storm drainage system, and to implement the proposed comprehensive street plan.. The proposed new positions are as follows: 1. Four Engineering technicians, Engineering 2. Two Utility Worker, Sewers 3. One Utility Worker, Streets and Storm Drainage 4. One Clerk-Typist, Public Works 5. One-half Library Clerk, City Library It is recommended that System Development Charge (streets) revenues be used to employ the addi- tional engineering technicians and to partially fund some existing engineering staff in girder to implement the proposed comprehensive street plan. Page 4 Currently the City has only two CETA employees. It is proposed that one of the two CETA employees be retained to fill the existing clerk-receptionist position. in City Hall. The other CETA employee (at the Library) would be terminated when CETA funding expires. Special Items - This budget reflects revenues and expenditures for TCYS and Loaves and Fishes. The assumption is made that voters will approve their special levies (TCYS, March 31 ; Loaves & Fishes, May 19) . TCYS is seeking a special levy of $66,383 and Loaves & Fishes $10,000. In the event they are not approved by the voters, appropriate adjustments will have to be made. This proposed budget also includes monies for assisting Tigard Town and County Days Celebration with police patrol, park maintenance, chemical toilets, etc. It also provides for the continuation of the City - Chamber of Commerce public information project (map, brochure, etc.) . Reductions and Deletions - It should be pointed out that several important items had to be reduced or completely eliminated from the budget because of the City's limited resources. Department heads requested expenditures that exceeded our projected revenues by about $225,000. Most of their requests were well documented and justified and it was very difficult to make the cuts necessary to balance the budget. The Budget Committee may want to consider various alternatives to provide for some of the items that were reduced or removed from the departmental requests. Some of the major items reduced or eliminated are as follows: 1. Additional personnel in the Police Department, Public Works and Library. 2. Public Works equipment (tractor, mower) . 3. Police Department equipment (communications center, recording system, computer system) . 4. Police Department - Integrated Criminal Apprehension Program. 5. Library books. 6. Word processor. It should also be pointed out that the City received requests from the following groups: Washington County Community Action Organization, $3,000; Shelter, Domestic Violence Resource Center, $500. Neither of these requests have been included in the proposed budget. It was felt that basic city services must be considered first (police, streets, sewers, etc.) , and in as much as departmental budget requests had to be cut to balance the budget, we should not fund the requests of the above agencies. SUMMARY The proposed 1981-82 City Budget is balanced. It was prepared with the citizens of Tigard in mind, and represents my judgment as to how the City can best serve its residents with the limited resources available.