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HomeMy WebLinkAbout2018-05-19 Council Minutes - Work SessionCouncil present: Others present: A. Call to Order KENAI CITY COUNCIL WORK SESSION FY2019 BUDGET MAY 19, 2018-9:00 A.M. KENAI CITY COUNCIL CHAMBERS 210 FIDALGO AVE ., KENAI, AK 99611 MAYOR GABRIEL, PRESIDING NOTES Mayor Gabriel , Vice-Mayor Navarre, J. Glendening, H . Knackstedt, M . Boyle City Manager P. Ostrander, Finance Director T. Eubank, City Attorney S . Bloom, Deputy City Clerk J. Kennedy, City Planner E. Appleby, Public Works Director S. Curtain, Buildings Official M . Wesson, Airport Director M . Bondurant, Parks & Recreation Director B . Frates , Senior Center Director K. Romain, Library Director M. Joiner, Acting Fire Chief T . Prior, Police Chief D. Ross Mayor Gabriel called the work session to order at 9 :00 a .m . B. Public Comment There was no public comment. C. Introduction -Paul Ostrander, City Manager City Manager Ostrander provided an introduction on the FY2019 Budget process, noted the bottom line total is slightly over six (6) percent increase in budget, pointing out examples that were included but do not represent cash outflows and include capital outlays. Excluding those makes the budget increase from last year only just over two (2) percent. Ostrander described the change in the way the budget document was put together this year with a shift on how to view the budget, focus on the "why" and understand what the City was trying to accomplish as individual departments as well as a City. He noted it would be presented by individual department leads and included functions and responsibilities , staffing, performance measures, department goals, and future considerations. D. General and Revenue Overview Presentation -Terry Eubank, Finance Director Finance Director Eubank called attention to a memo that was provided to summarize the changes that had been proposed to the FY19 Budget since disbursement of the draft document in April. Director Eubank provided a general and revenue overview, noting the budget was built around an assumption of a ten ( 10) percent healthcare premium increase. The following revenue sources were highlighted: property tax, sales tax, state/federal , other, central adm in fee, fund balance, interest on investments, transfers in . KENAI CI TY COU NC IL WORK SESSION MAY 19, 2 018 PAGE2of9 The following expenditures were highlighted : • Personne l Changes • Salary Schedule Cost of Living Allowance • PERS On-Behalf Funding • Employee Health Care • Public Employees Retirement System • Increase to the Equipment Replacement Fund Eubank reported overall it was $23,000 for budgetary impact on wages and benefits . Director Eubank advised that the goals and objectives of employee health/life insurance was to provide quality coverage, maximize savings , and stabilize the budgetary impact of employee health and life insurance costs. The increase would be around 9.8 percent. If the City were to keep the existing plan, it would be a 14 percent increase . The minor change would create higher deductible for out of network services and would create an out of pocket maximum . Eubank noted the biggest change was going to be prescription plan . City Manager Ostrander added that the new plan encourages employees to use generic alternatives to the name brand on select drugs . Director Eubank reported that the PERS On-Behalf Funding level increased in FY2019 from 3.01 to 5.58 % of covered payroll. He further noted the personnel changes included: Title and duties of the Manager's Assistant; Establishment of a Human Resources (HR) Director; Increase in qualification pay for Police; Restructuring of Temporary Enforcement Officers schedule to lengthen the period of employment and a reduction of one position; IT Summer Intern, eight-week position ; Temporary Land Technician ; Re-classification of Building Official position; Removal of the 365 days a year shift coverage for Wastewater Treatment Plant staff; Elimination of three 24-hour/week positions at the Library, through attrition , and replace with one 40-hour position and one 14-hour position . Director Eubank directed d istinct attention to the General Fund page labeled , "What do your taxes pay for" for use as a talking point with community members or citizens as an informative reference tool. Eubank highlighted t he following special or capital expenditures : Caselle Cemetery Management Software purchase ; Caselle Court Management Software purchase ; Wireless backhaul , Phase 1; Recrea t ion Center Improvements ; Fire Department kitchen re-mode l; Street improvements to be identified ; Senior Center dishwasher replacement ; Senior Center tile and carpet replacement ; Replacement of two Police cruisers ; Replacement of thermal imaging camera ; Intake valve at Fire Department; Backup generator for City Shop facilities; Snow blower head replacement; HR Director office construction; Re-finish the Visitor's Center exterior; and Treadmill replacement at Kenai Rec Center. KE NAI CI TY COUNCIL WORK SESSION MAY 19, 2018 PAGE 3 of9 E. Department P resentations The new Public Works Director, Scott Curtin was introduced and welcomed by Council members . 1. City Manage r City Manager Ostrander advised on the budget entity-wide organization chart, and clarified that it was meant to represent the supervisory structure of the City. Ostrander clarified that the grading criteria was based on individual requirements and the change in the Assistant to the City Manager position would include Special Projects and Community Development Coordinator role; and separately to establish a HR Directo r. Ostrander noted the department goals and performance measures moving forward as outlined in the budget. There were no significant budgetary c hanges. Visitor Center -Ostrander reported that the current faci lities agreement expires on 12/31 /18 and an invitation for bid for another Concessionaire to manage this facility would be advertised early in FY2019 . Land Administration -Only change is the request for a temporary Lands Assistant for 520 hours specifically designated to finish the City's Land Management Plan . It would be an extensive process that will include Council and potentially several work sessions . Human Resources -This would be a new department and the mission and responsibilities was created by current administration . Ostrander noted he expected to see a change in the mission and performance measures when the position was filled . This would be the first position hired under the Department Head Service approved at the May 16 Council meeting. Administration is continu ing to refine NEOgov, as it would be the primary step in recruitment; extremely resourceful and positive results since the City started using . 2 . Legal City Attorney Bloom highlighted the name aspects on the budget and noted that the biggest change was the performance issues that had not been incorporated in the past, to include managing litigation costs and collections on citations . He added that a number of contracts were processed through the attorney's office , and now every piece of legislation was going through the attorney's office before Council , so it would be tracked. Bloom noted that the significant changes in the budget were shedding of the code publishing responsibi lities to C ity Clerk office ; and a one-time fee for purchasing new a software system in order to process citations . 3 . Finance KEN A I CITY COU NC IL WORK SE SSION MAY 19, 20 18 PA GE 4 of9 Finance Director Eubank clarified that the proposal of an intern would allow for support and relief of the IT Director during Personal Use fishery, and additional help for projects. He noted that employee on boarding and trans ition takes a significant amount of time, as well as financial grants and administration. Eubank noted that it was a goal to increase the abilities of utility billing online. In addition , to migrate the three IT domains in the City all into one domain. Council Member Navarre suggested using a temporary hire person for the Eagle Cam and personal use fishery, allowing the IT Director to focus on higher priority needs . Non -Departmental Finance Director Eubank advised that this was where insurance costs for the general fund and all departments are , as well as City Manager's contingency, where transfers out come from, various capital projects , equipment fund payments , rentals , etc. 4. Planning & Zoning City Planner Appleby provided an overview of the Planning and Zoning budget and noted the largest reduction in the budget was under professional services, which paid for technical support of the Geographic Information System (GIS) and junk vehicle removal. Council recommended increasing funds in travel to ensure Appleby's attendance to the American Institute Certified Planner (AICP) training . City Manager Ostrander added that the previous planner was not AICP certified and returning to the higher budgeted amount would ensure travel and transportation costs were covered. Council supported transferring $1,700 back into the budget for this purpose . COUNCIL MEMBER BOYLE ARRIVED AT 11:17 A .M. It was clarified that because t he City owns much land associated with the airport, additional time/funds is allocated to it as needed in the managing of the land use . 5. Police Chief Ross advised the need to get back on a cycle of vehicle replacement. He reported that a vehicle had not been replaced in three years and currently, the average age of a police vehicle was 9 years old . The two vehicles being replaced were 2005/2006 models. Animal Control -There were no recommended amendments. Communications -An error was noted in organization chart t hat would be c orrected , there are 7 dispa tchers , not 10 . 6 . Fi re KENAI CITY COU NCIL W OR K SESSION MAY 19, 2018 PAGE 5 of9 Acting Chief Prior reported that there was a 27 percent increase in calls in the last 5 years . Council e xpressed interest in further analyzing the real life of a fire truck versus advocating for replacement after just a set number of years . Council Member Knackstedt advised looking ahead and if need additional staffing or more competitive pay, discuss with Ostrander and plan for accordingly with next budget proposal. 7. Public Works City Manager Ostrander advised there was a significant reduction in Public Works department budget due to 29 percent of the Public Works Director's time would be allocated to Water and Sewer and Waste Water, so the salary cost was shared between departments. Safety -It was noted that the safety program and more focus on safety was in place and workers comp claims were significantly less this year. Finance Director Eubank noted the City received the workers comp renewal. There were no recommended amendments to the Public Works budget. Shop -It was noted that the increase in the budget was because the City would not put salt in their sand t his year and it was being stored in a building rented from the Airport. Streets -City Manager Ostrander noted potential areas that the capital money would be spend was on Aliak St. Buildings -Ostrander noted some upward adjustments and that the chart would be revised to include a new classification and a grade of 14, although it had minimal budget implications . Ostrander clarified the change was due to the Building Official getting a promotion and supporting the Public Work Director in managing capital projects. Ostrander noted the overall budget was up and funds from th is budget would be used to construct the new HR Office. Street Lighting There were no recommended amendments. Boating Facility -Ostrander advised the need for a better analysis of that s ite to keep it fully functional for years. There were no recommended amendments. 8 . Library Director Joiner noted the revision in the number of Library Aides. KENAI CITY COUNCIL W ORK SESSION MAY 19, 20 18 PA GE 6of9 Finance Director Eubank clarified regarding computers that the plan forward with IT would be a five-year replacement plan. He added that each department was financially responsible for the number of computers they had so when it was time for replacement, it will be replaced and financial aspect would already be covered . 9 . Parks, Recreation & Beautification Director Frates provided an overview of the mission statement and goals. He noted the performance measures were a good gauge for growth and tied specific to the department goals. Council requested that items be listed that were considered but not included in the budget and to list the priority of the Parks . Council Navarre expressed interest in an addition to the budget to include upgrades to 4 th avenue park. 10. Personal Use Fishery Fund a . General , Revenue. and Department Overview Director Eubank discussed the following fees: Day use parking, overnight parking, camping with tent, dock launch and parking, participant drop-off fee. No changes in the fee funds were proposed but it was noted that the fees paid at any one location were honored at both beaches and the dock. Eubank noted a significant change in the budget was a $50,000 transfer to the General Fund. No significant management fund changes ; overall fund budget was up by eight (8) percent. 11 . Water & Sewer Fund a . General and Revenue Overview Director Eubank advised that 97 percent of this fund comes from usage fees . He noted that currently, they were only doing COLA increases within the rates, but not raising it this year as it was a minimal change. b. Water & Sewer Departments City Manager Ostrander and Public Works Director Curtin provided an overview, the proposed change in personnel shift schedule , and future budget considerations . c. Sewer Treatment Plant Ostrander advised that it was a priority to determine how to upgrade the p lant and the costs associated , whi ch may be significant so it would be advantageous and proactive to keep funds in the General Fund for such use when the time arises. KENAI CITY COUNCIL WORK SESSION MAY 19, 2018 PAGE 7of9 12. Airport Fund a. General and Revenue Overview Director Eubank presented highlights on the Airport Fund, including the refinements made in outlook revenue , noting administration was working with a consultant to look at the airport agreement, landing fees, etc. and now proposing a five (5) percent increase in amendments. He further reported the increase in Apron rates. Eubank noted that 40 percent of revenue comes from the permanent fund. He further provided details of the FAA Flight Service Station Rent, noting that since 2012, $680,000 was recorded as Airport Fund Revenues. After improvements and land rent due to the airport, a transfer was proposed to the general fund of $233,221. Eubank noted that the airport would be paid annually for the value of the land and the airport would get a return on their investment of their building. The history of the fund between 1984 to current was discussed. b . Airport Departments Director Bondurant provided an overview on the history of the airline operating agreement. She noted that the Consultant recommended extending the agreement for 1 year or when rehabilitation project was complete and then do another airline agreement for five years under new conditions. Director Eubank noted a change to the overview page to remove the word "phased". The performance measures of Airport Administration were noted and included: Airline Rents & Leases, Airline landing fees , Revenue per Enplaned Passenger, and FAA Grant Expenditures . Other Buildings and Areas of Airport included Float Plane Slips Leased , Water Landings , Fuel Sold (Gallons), Tenants, Slip Rental , Transient Parking Fees, and Lots Available for Lease. The performance measures of Alaska Fire Training Facility were noted as: Student Trainings , Class Trainings, Facility Repairs & Maintenance, and Vehicle Repair & Maintenance. 13. Senior Citizen Fund a. General and Revenue Overview Director Eubank reported on the following FY19 projected revenue sources : State Grants, USDA Grants , Choice Waiver, KPB Grant, United Way Grant, Rents and Leases, Senior Connection Donations , Other Donations, Transfers from the General Fund of Operations and Cap ital Projects. b. Senior Citizen Fund Departments Di rector Romain advised that there was only one personnel change with the new budget; the position title of Outreach Worker to Driver for delivery of meals but it would not affect the budget amount. KENAI CITY COUNCIL WORK SESSION MAY 19, 2018 PAGE 8of9 Performance measures in place for the Senior Center included: Congregate meals, Home Delivered Meals -Non-Choice Waiver, Home Delivered Meals -Choice Waiver, Assisted and Unassisted Rides, Volunteer Hours, and Activity Participation Units. Director Romain expressed intention of looking into and pursuing getting a greenhouse at the Senior Center next fiscal year. Romain reported that the Kenai Senior Center received the greatest designations through United Way but moving forward, that there was a 25 percent raise in grant funds per meal b by the State of Alaska. 14. Congregate Housing a. General and Revenue Overview Director Eubank reported 98 percent of revenue comes from tenant rents but this fund also included interest earnings and other miscellaneous . He suggested a change of the current provision in code, to not transfer funds when it reached a half-million in the account. The purpose of this recommended change was discussed. b. Senior Citizen Fund Departments There were no recommended amendments. 15 . Employee Health Care Fund a. General, Revenue , and Department Overview Director Eubank reported the projected revenue sources were significantly by charge for services , in addition to participant premiums and interest earnings. There would be a 9.8 percent increase with a few small changes; otherwise, to keep the health care the same, it would have been a 14 percent increase. Employees ' portions would be re-calculated based on the 1 O percent shared cost. Eubank noted that once the City had 100 covered employees for 9 months, the insurance company would be willing to provide significantly more information that would help administration advise employees on how to save costs on health insurance. 16 .PermanentFunds a. General, Revenue , and Department Overview Director Eubank reported that the Airport Land Sales Permanent Fund was established to account for the proceeds of airport land sales , including principal and interest on long-term notes. Eubank noted that the General Government Land Sales Permanent Fund was established to account for the proceeds of general government land sales , includ ing principa l and interest on long-term notes. He added that the City 's outstanding debt was 1.26 million; a debt until 2030. KENAI CITY COUNCIL WORK SESSION MAY 19, 2018 PAGE 9of9 17. Debt Service a . General , Revenue, and Department Overview Director Eubank provided an overview; there were no recommended amendments . 18 . Equipment Replacement Fund a. General, Revenue, and Department Overview Director Eubank clarified that the projected equipment replacements in FY2019 were the Fire Department Engine #3 and the Street Sweeper. He added that it would be brought to Council for approval. F. Additional Public Comment There was no one wishing to be heard. G . Council Comments Council expressed gratitude to Administration for their time and effort in the budget process and noted that the information by each department was thorough and appreciated . The new budget layout was well accepted and Council thanked Administration for the quality presentations and discussion. Vice Mayor Navarre thanked the press for attending all day. Navarre also stated that he would like to see some plan in the budget to better the parks. He further added that it would be advantageous to have funds in the budget for Council to travel to Washington D.C . for legislative discussion and networking . Director Eubank noted that a resolution would be drafted and brought to the next Council Meeting regarding a budget transfer of $5 ,000 for construction of a fire truck shelter in FY2019 . Eubank further offered to Council if they are interested in meeting with him prior to a Council meeting, he could address things specific to their interest, during the Council meeting . H . Adjournment The work session adjourned at 6 :30 p.m. ~otes weref\prepared by: (\ l\~c 1l\Q.fv--~ ,,~:i.. : Jacq ~ely n Ke'~nedy @eput'y C ity Clerk