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HomeMy WebLinkAbout2010-05-12 Budget Committee MinutesBUDGET COMMITTEE MEETING MAY 12, 2010-PAGE lof 3 Budget Committee Meeting Draft Minutes May 12, 2010 6:00pm Civic Center Council Chambers,1175 East Main Street CALL TO ORDER The Budget Committee meeting was called to order at 6:02 ROLL CALL Mayor Stromberg was present. Committee members Runkel, Baldwin, Stebbins, Douma, Silbiger, Chapman, Slattery, Jackson, Navickas, Voisin, Everson, Lemhouse, and Thompson were present. PUBLIC INPUT None. CAPITAL IMPROVEMENT PLAN OVERVIEW Mr. Faught went over the FY 2011-2016 Capital Improvement Plan (CIP) Overview and distribution of funds (see slides). FY 10 $2,952,100 FY 11 $10,859,000 FY 12-16 $25,457,000 Unfunded $48,956,000 PUBLIC WORKS Public Works Director Mr. Faught was joined with Public Works Management Assistant Betsy Harshman to present the Public Works budget. He introduced Engineering Services Manager Jim Olsen, Public Works Superintendent Terri Ellis, Street Supervisor John Peterson and Maintenance Safety Supervisor Mike Morrison Jr. who were also there to help present the Public Works budget. Mr. Faught discussed the Street Fund by category over time (see slide). Percentages for FY 2011 are: Capital 60%, Materials and Services 26% and Personnel 14%. Personnel for the most part has been trending pretty flat over time. When CIP funds are available there will be spikes in the budget. The major projects coming for FY 2011 in the Street Fund are: Jefferson Avenue Extension, Laurel Street Sidewalk, Hersey to Randy and Hersey and Laurel R/R crossing, and three street overlays. Internal work that will be coming is the Slurry Seal Street prep which is patching, pothole repairs and sweeping. On the Stormwater side the Department has continued to do segments of Iowa Street and begin a Winburn Way storm drain project. Another project is storm drain labeling which is a requirement for Stormwater phase II permit. Mr. Faught went over the performance drivers for the Street Department and Storm Water (see slides). The desired outcomes are for the Street Department to inspect and maintain all City regulatory signs. There are about 700 regulatory signs that need to be maintained. The Storm Water drivers include Federal and State mandates and regulations. The desired outcomes are to insure storm drain water quality meets or exceeds all required parameters. This includes meeting bacteria and temperature standards as well. Mr. Faught spoke to the performance to budget for the Street Department (see slide). The proposed street operations budget enables staff to meet most desired outcomes with the exception of capital project street repair. On the proposed stormwater collection side budget enables staff to meet most desired outcomes with the exception of meeting all bacteria and temperature standards annually. Mr. Faught discussed the significant expense budget changes from FY 2010 in the Street Fund. There was an increase in the CIP this year because of the MPO funds and house bill 2011. There are no external capital projects for Stormwater because there is no money for capital projects. In preparing for 2012 the Street Department has a large section of the Department that can retire within the next five years. If the Department chooses not to fill the BUDGET COMMITTEE MEETING MAY 12, 2010-PAGE 2of 3 position the offset will go to materials and service reductions that tie to those things. Grant applications will continue to be submitted. Mr. Faught went over the Water Fund Budget (see slides). The personnel trend has been fairly flat, and Materials and Services have had little fluctuation. Capital has fluctuated throughout the years due to when monies come in. The work coming for FY 2011 in the Water Fund is the completion of the Water Master Plan. A safety analysis will take place for Holser Dam which is a federal requirement. Due to problems with the TID pump station during water curtailment last year repairs will be made. There will also be improvements to Reeder Reservoir and silt removal on east and west forks, there is a total daily maximum load limit on the reservoirs for this which is designed to set the sediments. Mr. Faught spoke to the performance drivers for water treatment, water distribution and water supply (see slides). All performance drivers are based on Federal and State mandates. For both water treatment and water distribution the desired outcome is to maintain quantity and quality of potable water with no violations. The water supply desired outcome is to maintain an adequate supply of high quality water. The proposed budget does enable staff to meet most desired outcomes for the Water Fund with an exception of capital projects for example Crowson II which will have to be pushed out another year. The significant budget changes from FY 2010 in the Water Fund are reductions in materials and supplies to offset the personnel cost increase. There will be an 8% water rate increase and have deferred capital projects. Mr. Faught stated that attrition, materials and service reductions and reductions in internal projects will be ways to prepare for FY 2012. Mr. Faught discussed the Wastewater Fund (see slides). The Wastewater Fund has had fluctuations in personnel. Materials and Supplies fluctuated in 2009 due to spending only what was needed for the year. The work coming in FY 2010 for wastewater is the Ashland Creek mainline replacement which is over a 100 year old line which runs parallel with Ashland Creek. Membrane filtration replacements which will be funded one third for three years. The Wastewater master plan will also be worked on. Mr. Faught went over the performance drivers for wastewater collections and wastewater treatment plant (see slides). Both are Federal and State public health mandated. The desired outcome for wastewater collections is to have no sanitary sewer overflow. The desired outcome for wastewater treatment plant is to have no National Pollutant Discharge Elimination System (NPDES) permit violations. Mr. Faught stated that the proposed budget enables staff to meet most desired outcomes with the exception of deferred capital projects for example Grandview Pump Station. The significant budget changes for FY 2011 are an 8% wastewater rate increase. Materials and supplies will be increased for bio-solid disposal and to do priority pollutant testing. The membrane replacement will be paid for by a $200,000 transfer to the Equipment Fund. Mr. Faught stated that attrition; materials and service reductions, reductions in internal projects and appropriate rate increases will be ways to prepare for FY 2012. Mr. Faught discussed the significant budget changes from FY 2010 in the Administration and Engineering Department and all other Public Work Funds (see slides). In the Administration and Engineering Department there was reductions in contracted services and as of May I" there is one vacant GIS position due to retirement. In the Cemetery Fund the irrigation system was not replaced and it no recommended replacing it next year. The Airport Fund has proposed rate increases. The significant changes in the Equipment fund is funding $535,000 for three years for the Wastewater Membrane Replacement project and there will also be a $200,000 revenue transfer from wastewater treatment budget. The Committee questioned if departments will be able to continue to operate with staff reductions through attrition. Mr. Faught answered that the Department will look at the internal organization and see how they can cut back. If there is a retirement in the treatment plant that position will be filled. All other areas will be looked at very carefully and see if some of the work can be shifted. The Committee questioned why the personnel services cost went up by 7% when the number of people went down by 2%. Ms. Bennett stated that most of it is due to step increases and health benefits. Thompson arrived 7:1 S BUDGET COMMITTEE MEETING MAY 12, 2010-PAGE 3of 3 The Committee questioned how much Public Works spends on consultants. Mr. Faught stated that it ranges $350,000 for water and sewer. Internally for example the Engineering Department is proposing $30,000 for the year for consultants. The Committee questioned the contingency for Public Works Funds. Mr. Tuneberg stated that a department doesn't have a contingency a Fund does. Across all Funds in Public Works the total comes to $503,000 which is higher then prior year. The Committee questioned if any contingency has been spent this year. Mr. Faught answered no. Mr. Tuneberg discussed the memo regarding the add package (see attached). A rate increase will be coming to all PERS participating agencies in the state for FY 2011-2012. It has been indicated that it will be in the 6%-12% range. This amount will not be on top of the amount being paid now it is an additional percentage contribution calculated on what the City's payroll is. Ms. Bennett went the agenda for the May 13, 2010 Budget Committee Meeting. The two add packages will and the Reserve Fund will be discussed. The Amigo Club will be attending to request $3,300 as well as Siskiyou Violins to discuss funding their grant request. The Committee will then adopt the budget and if time remains complete the budget process debrief. Committee member Roberta Stebbins will be unable to attend the next Budget Meeting so gave a few final statements. Ms. Stebbins stated that she really appreciates Council for creating a Reserve Fund. It is important to maintain fiscal stability. There are three major elements to personnel services which are salaries, retirement benefits and health benefits. All three should be addressed. Ms. Stebbins suggested that legal restrictions be placed on the Reserve Fund prohibiting the use for ongoing operating expenses. In regards to the two add packages Ms. Stebbins feels that they are essential but feel it should not be due to increasing the tax rate. If the tax rate is going to be increased then would like it to go to the Reserve Fund. Ms. Stebbins thanks Staff and all Department Heads. ADJOURNMENT The meeting was adjourned at 7:30 pm Respectfully Submitted, Melissa Huhtala Administrative Secretary Public Works Department City Of'Asihland' Summarroposed Budget Cemetery $ 311,005, Street Fund $ 6,1701,3651 Airport Fund $ 102,287 Caplital Improvement FundI ,789,522 Water Fund $ 5,826,661 Wastewater Fund $ 6,160,762 Administration & �Engineeiring $ 1,380,354 Equipment Fund 1_1162,024 Tota 1 $ 25,102,9801 %40�1 6k FY 11 -16 CIP Overview o FY 10 $ 2,952,,100 * FY 11 10,859,000 * FY12-16 25,457,000 # Unfunded 48,956,00'O . . . .. . ..... lkI)M]NuNTRATRPN FA �LIIIHIIX S475,0( �j A% I I N10 R NI A I I ON EX , HNOLOCY, S91,1000 1 01aM A FIN CI ELECOMM SM1,00, 1,8% WAS"FEWA-1 p, 2 p fl,f](jo , V PARKS & RM HEATION, 0, AIRPOM, Sq,800,000, l6r6% A] I RA N M10 Rl Al 10 N ? Lfl), $3,458,000, 31,8% SFORM I)RMN, $3 %,000 , 0A IN. Sitreet Fund By Categary Over Tim�e S3,000,000 100 '0101,11 '00 0'0 00 M 2007 Actual 2008 MUM 2009 Actual 0 Cati lal 60 % 0 Person-ol 14% H'eire"s the work we seie ow, T— V I" .i Coming in IFY 0 21111 - 'tret a e Mk0r,P ecLs tpi_ * Jefferson Aveniuie Extension (Brammo) * Laurel Street Sidewalk, Hersey to and & Hersey and Laurel R/R Crossings * (3) treet Overlays Internal Work Slurry Beal street prep, patching and pothole repairs, sweeping Stormwater • Iowa Street & Wiinburn Way storm drain • Storm drain labeling . . ....... . Performance Drivers L&A Street Department (Page 3-83) Street Department - --- ------ Budget Desired Council Vailue Criteria, Outcome Actilon.lPerformance .................. . . . . .. Federal & .................. .. . . Inspect and - --- ------ . . .... ...... Inspect and maintain approx 700 signs Stite rnalintain all City Inspect and maintain 41.3 miles of Publk Health regulatory signs, street rnairkNngs annually (Constrained street markings Mlaintain Sig,nView database daily by) and traffic Provide traffic conitrol and signage daily Mandates and cantroR as needed regulations Maintain adequate annual training Staffing required (2,.0 FTE) r r rivers, - Sto'rm Water (Page 3-88) ......... .................. . . ... . ... ... . . . ... .. . ........ - -------- - Dieslred - ---- ---- - - -------------- ---- --- Councilll Value Budget Criteria Outcome Action/Pertormance . .. . .. . .. .. ... .......... ........... Federal & State... tate Insure storm . ........ .. ..... . . . ........... . ...................... Meet alit bacter'O and tilk" Public Health drain water temperature stanidards annualily (ConstraNned by) quality rneets or Label 3000 storm drain inlets 11 Mandates and exceeds all I S�weep 9500, lane miles of streets 15 32, regUlations required annuaily Establish BMP's on erosio n pararneters control and educate City personnO and contractors annually Staffing (1 -5 FTE) .. . .. ......... Pierfoirm�ance to Budget — LI Street Deplartment Proposed Street Operations budget eniables staff to meet most desired outcomes ,,, Exception — Capital Projects (Street Repair) o Proposed St�ormwater Collections budget enables st'aff to meet mosit desired outcom�es Significant Expense Budget Changes fromi, FY 2010 - Street, Increased capi�tal projectis in Street Operations, (MPO funds, and House B111 2011 Preparing for F'Y /ƒ\ ^LI 'I Street Department • Reduce numbler ornial projects • Evala,te use of seasonal employees • Continue to subimit grant applictions for capital projects. IL Water Fund Budget, Over Timie INNEEMEM S 6 I(J 00 1000 S U Herei"s the work we see coming in! F'Y 20111 - Water, Fund FERC Part 12 Hosler Dam safety analysis W'at er curtailment/TID pumpi station improvements Reeder Reservoir improvements a,nd'sil�t removal east & west forks Performance Drivers, — e Watr'Treatment (3-95) Performance Drivers — Water Distribution (Page 3-96i) 1 61cadet" , , De-s—ir'd - — -- -- ------------------ ..... .... .... Councid Va:lue Criteria � OLACOMO ActionilPerformance Federal & State Maintain ... .. .... . ......... inspect and maintain 4 purnp Public Heaft adequate stations weekly (Constraiined quantity & Inispect and maintain 30 pressure by) quauty of regiWators annually Mandates and potab,le water Maintain a annirnurn 20 PSI water ,4 regulations, Public Health with no violations I I zones pressure in six pressure throughout the city daily Maintain less than 10% water loss in system annually Insure waiter sampling program is completed Weekly inspect and maintain 1392 fire hydrants for fire protection I annually Rush 85 dead end lines aninually Cross connection program ............ .... ... . . . Maintain staffing (6,0 FTE) r"A, Performance 1r),riversi - V:A VVniter 00"Upply (Parlei 3-9751) n�jbl U Plerform�ance to Budget — Water Fund' Proposed budget enables staff to meet most desired outcomesi, * Exception - Capital Projects (Crowson IIi Significant Budget C�hang�ies, LIM frorn FY 2;1010 - Wa,ter Fund Preparing for FY 20112 - Water Fund • Attrition • MIaterials and service reductions • Redunumber of internal projis • Ma,ster plan evaluation of staffing requiret • Appropriate rate increases, Wastewater Fund Budget Over T'im�e S7,000,000 S6,0,M),000 S,5,0(0,0100 S4,000,000 $3,0001,41M 51,0010M)o $1 1000,000 VI 20,07Actual 2008MIual 2009A(Amd H\eire's, the work we see coming in IFY 2011 - Wastewater • Ash�land Creek mainline replace meint • Membiran�e filtration reipl�acemiienit (1/3 for 3 years) Performance Drivers — Wastewater Collections Page © Oi5 Performance Drivers, — Wastewater ! L10111 Treatment Plant (Page 3-106) ....... . . . .... . ............ . . .. . .... .. .. .. .... Budget counvl� Valu Bet C Desired C Budgkncome AcHon/Perfon'nance Federal & No NIPDES Replace membranes every seven State permit years RI'11 Majintain CMMS program daily A Public Health violations (Constrained Review laboratory data dailly by) Review and update SO,P"s Mandates annually and Inspect 15 acxounts annuafly as U reguWtions part of the pretreaitment prograrni PUblic Health Update saniitary sewer master plan r d Manitaiin adequate annuall trainingi Maintain staffing level (5 0 FTE) a. .... .. . ... .... .. --- - ---------- ---------- --- ---- -- ---------- W, Performance to Biu�dget -1 $1, Proposed buidget enables sitaff to meet most d'esired oiuticomies. Exception — deferred capital projects (Grandview Pump Sitaition) FY 11 1 Significant Buidget Changes, — Wastewater Fund * 8% Wastewater rate iincre,ase * Materia,ls & supplies increased Bio-sofidl disposal' State mandated SB 737 (Piriordty Pollutant Testing) * $200,000 transfer to Equipment fund (annual) for membrane replacement Preparing, for FY 2012 - Wastewater • Attrition • Materials and service reductions • Redluce number of internal projects, • Master plan evaluation of staffing and capital requirement • Appropriate, rate increases Significant Bu�dget Ch�ang�es from L"A FY 2010 Admin & Engineering Reducti'o�n in c�ontracted serviceis As olf May — (1) vac:anit GIS, pon (retirement) FY 11 S�i'g�nificant Budget is C�hanges, — All Oth�eir PW'Funid' emi Cetgr � 1 r­ _y Did not replace irrigation system FY201 0 Asir �Ort ,oRate Increase Facifities a Airport Runway Overlay Project ($1 .8 Milhon grant) Eaubmen t Waste Water Membrane Replacement Project $55,,000 per year(1/3) per year $200,000 Revenue transfer from Wastewater Treatment bludget MM" Email - Phone (I 1 r r Phon (5 1) 552-2 1111 DATI May 12, 2 010 , ommittee F'R 0 N1 Lec & Martha Admin Services & Adrilinistratiorl R F" . I 1arification ofadd package: 7.31. cents in property tax for reserve stal't, Ic1t it W,ls apj�oropriate to try to chirify the reasons for our recommeridal ion tNat the (-'ity levy the, entire permarient rate and golace it into a reserve fund for upconiing PE RS costs, III addition, we would like to clarify both wtiat restrictions COUld I)c Placed on the reserve and what will happen to (lie 7.32 cents In future budgets. (Jpconiing PERS Rate Increase Staffand the public have heard that the system will increase the rate 6or (lie Finployer's share off1f,RS paynients by, betweell%'�,", to 12%"or the bien1liLIM that begins .11,11Y 1, 2011 This rate increase Is necded to cover corn in i tillerTER-fol—e-K5 sting retirees, not For future retirees (current cniployecs), This amount is not needed because ol"changes, in the employees share or because of Ilegoli"'Itions with arly exisfing labor grOUP (either in Ashland or at the State Level). Honly 6% is added 'tco the rates the cstirnated hirpact lor the City, is abot.1t $76,000. At least(,�'300,000 ofthat wvill lie in the General F'Urld, The increase could he as IllUdi as 12%o (althOUgh, rrnlikdy), and ffic inipact to the GC11CNII F1111d WOUld be closer to $600,000. "I -he rest will lie in other funds, Priniardy the enterprise ffinds, that may be able to absom-1) or ()ff*,sc( the increased cost through utflity rates, The Parks Fund will also Nive to absorb ()I- cover ainsestunam�ted additional $ 10' 0,000 in PER S costs, llkcausc we expect Gieneral Fund t'cvcnL:ICS to N111aill flat over the ncxt year, staffis conccrned that an emcnially illiposcd hit of at least, $300,000 Nvill cause US to need to further reduce personnel in tile Gencral Fund, and it \vill he very difl-icult not to have sonic of those CULS 11111 011 Public Safety' (1cpartnients. We rccotrurrend that tile City, put, funds in reserve to spread tile in ipact ot'lliat rate increase over two fiscal years. The 7.32 ccins in additional property tax wfll gcnerale approxini'ately $ 138,000 door the orre year. As you can sec, raising the tax 7,32 and genera I ing an add In ona 1 $138,000 (ioes ncA solve the inipact, in tire (ieneral Fund in 2012. Levying the t,ix over 2011 and 20Q 12 should generate $276,000, The total, or even halfilthe tax is done for orre year, \vilf help [lie transition to the new F,niployer Share. It is inarlagenient's perspective thaat, afiCr fo.)LI1- years of'clits, ztfl General Funds departtrictits are at Ilihikiluni, ADIMMISTRATIVIE SERVICES DEPARTMENT DL. Tumberg, Director TO 541-488 5300 20 EaM Ma0i Weet Fax: 541-552-2059 Ashlaind, Oregon 97520 TTY� 800,7315-2900 www asNand oir.us CITY OF ASHLA"' 6 11 or ne'ar 1-ninitrium, lekeki and dils add 1;xackage will help to avert niore suaffitig reduictions hi the Gcneral 1"Und that will impact crilic�,,d Services such aS j)UbhC Slf'Cly or i'mindated programs. If' the cornli'litlee Chooses to not lcvy the added 7.32 cetils 111c, full �,sniount of the PERincrease, whatever it is, will need to c addressed, a:it this time, next year, Reserve Resirictions The AsIfland (,ouncil can aaelopt policies that restrict the use ofthe reserve Fund and CIISLIT-C l,43t it is 110t UScd f(,,)i- other expendilUl"M fftllC BUdgCt O)IIIIIiii[tce approves the aHocation of hunds for the reserve, stal'I'proposes that the ("ity (,,ouncil adopt as resolution that clarifies that the allIOU111 added 'Ill this bUdgCt is resiricled to offset Stale of"Oregon imposed iricreases in, (lie Employer's have liar PE" to the Gieneral Fund to prevent reductions in stal"llng ill Public Saicty, departments, Adoptinga cicar 1,1(flicy will ])],event the City fi'mrl using these fundS ter 8110ther PUrpose, (prograrri expenses, salarles ctc,). Year-to-year Decisioll. Ifthe committee approves the iticrease for 20 11, the committee would have to consider this levy again (lie next, ind each subsequent year, to deal with the licightcried PE RS cost if. it corltinues more than two ycars. I FPFIRS reduces their costs or if'other ('ity revetities begin to grow again, the 7.32 cents could he redUced. Annually, this tax rate and usage ofthe reserN,,ed monieS Will I-C(Illil-C 1311(1g(.�t ('MIMI'liftee approval. ADMINISTRMWE SERVICES DEPARTMENT 0, L, Tuneberg, Dkedor rel, 54-488-5300 20 EaM Main Strect Fax� 5411-5512,2059 Mail AsWand, Oregun 97520 TTY. 800,735-2900 www-ashland,or LIS