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HomeMy WebLinkAbout2006-05-02 Council Minutes - Budget Work SessionKENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 6:00 P.M. KENAI CITY COUNCIL CHAMBERS MAYOR PAT PORTER, PRESIDING Council present: P. Porter, J. Moore, L. Swarner, C. Massie, R. Ross, R. Molloy Council absent: M. Boyle Staff present: R. Koch, C. Freas, C. Graves, J. La Shot, K. Kornelis, B. Frates, M. Joiner, R. Craig, R. Cronkhite, R. Kornfield, B. Springer, R. Feltman, L. Semmens, M. Tilly, C. Kopp, M. Wichman, J. Neiderhauser Mayor Porter called the work session to order at approximately 6:00 p.m. and requested an update from Administration of any changes made to the draft budget since it was first distributed. Changes noted were: projected revenues, health insurance issues, and a request for an increase to the budget to fund staffing for the Clerk. Cost of Living Allowance Discussion: It was noted, the proposed budget included a three percent (3%) COLA increase for the employees. Findings: Council had no objections to including the three percent (3%) COLA increase in the budget. Insurance Discussion: City Manager Koch explained the proposed budget had included in it a ten percent (10%) increase for projected insurance costs; there was approximately four percent (4%) of insurance funds remaining from the current budget; notification was received from Premera/Blue Cross stating a 20% increase; and, the actual increase to the proposed budget would be approximately $70,000 or six percent (6%). He noted two suggestions: Keep the proposed amount in the draft budget and look for other coverage or change the deductible and maximum amount from $200 to $300 and $1,200 to $1,300 which would save $70,000. Findings: Proceed with the amount in the budget and research other coverage and include a review by the employee committee. Clerk Budget: Finance Director Semmens explained a proposal to return a Finance Department 25- hour/week employee (who is already receiving benefits) to a 40-hour a week position and the position be shared 50/50 by the Finance Department and the City Clerk Department. He noted, benefits in doing this would be hiring and retaining better qualified personnel; the additional would be $20,000 a year; $11,000 would need to be added to the Clerk budget; and, he recommended, if council did not choose to increase KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 2 the hours of the position and share it between the two departments, the same additional funds be added to the Clerk Department to allow additional staffing. Discussion followed during which comments included: • Sharing the position with two supervisors could be problematic. • Two commands presents a problem, but it would maximize the cost of the health benefits already being paid. • There is another 25-hour/week position in the city receiving benefits. • The person in the position proposed to be shared was made aware of the proposal. • Suggestion the City Clerk position be changed from the supervision of the Council to the supervision of the City Manager, with the appointment of the Clerk remaining with the Council. • Try the split position for a year, knowing there could be problems and issues to resolve. Findings: Include the $11,000 to the budget to make a full-time position to be shared between the Finance and Clerk's Departments. Visitors Center Budget: -- Request was made for meeting minutes be forwarded to the City Clerk for review by council. Findings: No changes to the budget. Legislative Budget: -- Brief discussions took place related to the benefits received from membership to the Alaska Municipal League; whether to fund Project Protect, branding program, and the Alaska video. Findings: Include $12,500 for the television production; $7,500 for the Project Protect program; no on funding a branding program; and, remove the CIP brochures heading in the Legislative Printing & Binding budget (leaving the $500). Legal Department: Findings: No changes. City Manager: Findings: No changes. Finance Department: KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 3 Findings: No changes. Lands: Findings: No changes. Non -Departmental: A brief discussion took place related to the request to purchase a new copier which is situated in the Clerk's Office. It was noted the current copier is old; is used by all the city departments; parts for repair are hard to get due to the machine's age; and, funding is included in the non -departmental budget because of the machine's use by all departments. Findings: No changes. Planning & Zoning Department: A brief discussion took place related to providing a stipend for the Planning & Zoning Commission. Findings: No stipend of the Planning & Zoning Commission. No changes. Safety: Findings: No changes. Police Department: A brief discussion took place related to the non -funding of police vehicles. Findings: No changes. Fire Department: A brief discussion took place related to the non -funding of a pick- up truck and extrication equipment. Findings: No changes. Communications: Findings: No changes. Animal Control: Findings: No changes. Public Works Administration: Findings: No changes. KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 4 Shop. Findings: No changes. Streets: A brief discussion took place related to snowplowing and removal of snow from the middle of the streets to lessen the amount of sand that melts into grassed areas along streets. City Manager Koch stated he would have an estimate for snow removal prepared. Findings: No changes. Buildings: Discussion took place related to placing another storage shed at the Senior Center. Findings: No changes. Street Lights: It was reported there was no funding included in the draft budget for new street lights, only repair of street lights. Findings: No changes. Library: Findings: Add $5,000 for the purchase of books. No other changes. Recreation: Findings: No changes. Parks: Findings: No changes. Beautification: Findings: No changes. Boating Facility: Findings: No changes. Special Revenue Funds: KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 5 Water/Sewer Fund: Staff is to research another solution prior to the budget ordinance come before council for public hearing. Findings: No changes. Waste Water Treatment Plant: Findings: No changes. Airport Land system: Findings: No changes. Airport Maintenance and Operations: Findings: No changes. Airport Administration: Findings: No changes. Airport Land System: Findings: No changes. Senior Citizen Grants: Findings: No changes. Senior Center: Findings: No changes. Enterprise Funds: Airport Terminal: Findings: No changes. Congregate Housing Fund: Administration is to consider a rent increase next year. Findings: No changes. KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 6 Permanent Funds: Findings: No changes. RECAP: Adjustment was made on property and sales taxes. Budget deficit after the lapse, $232,000, Additions made during review of budget: $11,000 -- Finance/Clerk shared position $12,500 -- Legislative/television video $ 7,500 -- Legislative/Project Protect $ 5,000 -- Library/Additional books Additional discussion: • State of Alaska Funding: A brief discussion took place related to possible legislative funding. • Shore Fishery Lease Ordinance -- It was explained, if there is interest in amending the code to change the terms of shore fishery leases, the ordinance would need to be introduced at the May 3 meeting or a special meeting held. Also, if council would want to change the renewal time to review again in the next several years instead of waiting the current ten-year period, the ordinance would need to be introduced at the May 3 meeting. Council stated they would discuss it further at the May 3 council meeting. • Budget Ordinance Calendar -- May 17, 2006/Introduction of budget ordinance which would reflect the changed made at the May 3 budget work session. -- June 7, 2006/Council consider a motion to apply the three percent COLA increase to the City Clerk and City Attorney salaries. -- May 17, 2006 -- Evaluations of City Clerk, City Attorney, and City Manager. • PERS Relief: City Manager Koch discussed the possibility of receiving additional funds from the Legislature. Koch was requested to prioritize programs to put back in the budget if funding is received from the State. The work session adjourned at approximately 8:05 p.m. Notes prepared by: /"sFr 01"1D Wf COUNCIL Carol L. Freas, City Clerk ,p, 04TE o Y C;tVRa. Schedule of COLA vs CPl CPI COLA Increase Pay Rate Calendar Ann. Avg. Difference Cumulative Difference Effective Date Increase Year Anchorage COLA-Anc 15 years 10 years 5 ye 7/1/1986 0.0 1985 2.9 -2.9 7/1/1987 0.0 1986 0.5 -0.5 7/1/1990 4.0 1989 3.3 0.7 7/1/1991 6.0 1990 7.0 -1.0 -1.0 7/1/1995 2.5 1994 2.3 0.2 -2.8 7/1/1996 2.0 1995 2.7 -0.7 -3.5 -0.7 7/1/1997 0.00 1996 3.0 -3.0 -6.5 -3.7 7/1/1998 2.00 1997 1.2 0-8 -5.7 -2.9 7/1/2003 0.00 2002 1.9 -1.9 -13.2 -10.4 -7.0 07BudgeVcpi.xls Since Last COLA To: Rick Koch, City Manager From: Larry Semmens, Finance Director Date: May 2, 2006 Subject: Recommendation for clerk department staffing About 5 years ago the finance department agreed to give up full time status of our department assistant 11(receptionist) position to allow the planning department to increase their part time position to full time. Since then finance has had a 25 hour position, which means that the position has health insurance benefits. The Clerk department needs more clerical assistance and coverage when the clerk is on vacation or otherwise out of the office. We have considered and tried various solutions including a half time position, contract support, temporary help and coverage by other city employees. These solutions have helped, but none were totally successful in resolving the issues. I recommend that the finance department and the clerk department share a full time position. This would mean that the department assistant II position would be budgeted half in finance and half in the clerk department. The finance department would not have a 25 hour position. The benefit to this arrangement is that the City would be better able to hire and retain a qualified person for these positions than we would if either position had to be filled with a part time person. The additional cost to bring the current person to full time status is about $20,000 per year. Since the Cleric department budget includes $9,200 for 1/4 time help, the actual increase to fund this proposal is less than $11,000. The Cleric budget would increase approximately $25,000 and the finance, water and sewer budgets would decline slightly if the position is split evenly. If this recommendation is not adopted, I think we will still need to find a solution that provides the clerk with more staffing. The 500 hours in the budget will not solve the short handed situation the clerk is in. One final consideration should be succession planning. In the next 5 years I expect significant turnover at City Hall due to retirements. Low turnover in support staff positions will be important. TOTAL ASSESSED VALUE REVENUE Property Tax Sales Tax BUDGET PROJECTION - GENERAL FUND Original Actual Actual Budget Projection Budget FY 2004 FY 2005 FY 2006 FY 2006 FY 2007 $ 386,311,390 $ 398,490,477 $ 399,959,300 $ 426,000,000 $ 453,000,000 MILL RATE 5.00 4.50 4,50 4.50 4,50 State/Federal Revenue: Revenue Sharing//PERS Funding Safe Communities and Muni. Asst. Fish Tax Other Total State/Federal Revenue Other Revenue: Licenses and Permits Ambulance Fees Interest Other Total Other Revenue Total Revenue Transfers From Other Funds Charges to other funds Capital Projects / Special Rev. Enterprise Trust Fund Total Transfers TOTAL REVENUES AND TRANSFERS EXPENDITURES/APPROPRIATIONS General Government Public Safety Public Works Parks, Rea & Cultural Total Operating Expenditures Operating (Deficit)/Surplus before transfers Transfers to Capital Projects Other Transfers or Non Operating Total Transfers and Non Operating Total Expenditure/Appropriation Total Deficit/Surplus Projected lapse Adjusted (Deficit)/Surplus Beginning Fund Balance Ending Fund Balance Encumbrances Reserves and Designations Unres. Undesignated Fund Balance $ 2,048,176 $ 1,912,376 $ 2,043,800 $ 2,042,500 $ 2,175,000 3,790,644 4,090 468 4,085,000 4,285,000 4,456,400 151,893 - 236,000 236,000 - 58,132 130,950 100,000 125,000 75,000 297,620 304,411 49,000 182,920 50,000 507,645 435,361 385,000 543,920 125,000 84,932 56,632 60,300 61,000 155,300 208,686 212,840 270,000 248,000 248,000 113,986 275,536 375,000 280,000 430,000 686,635 881,787 755,300 861,100 778,535 1,094, 239 1,426, 795 1,460,600 1,450,100 1,611,835 7,440,704 7,865,000 7,974,400 8,321520 8,368,235 971,600 1,026,264 1,011,800 1,011,800 998,000 69,368 - - - - 54,801 - 34,000 34,000 10,000 12,492 14,211 12,000 7,000 6,800 1,108,261 1,040,475 1,057,800 11052,800 1,014,800 8,548,965 8,905,475 9,032,200 9,374,320 9,383,035 1,486,056 1,586,460 1,759,785 1,999,323 1,840,506 3,419,293 4,262,592 4,424,797 4,531,894 4,751,506 1,471,479 1,753,030 2,247,737 2,403,180 2.254,893 1,004,449 1,106, 777 1,221,071 1,262,955 1,245,981 7,381,277 8,708,859 9,653,390 10,197,352 10,092,886 1,167,688 196,616 (621,190) (823,032) (709,851) 29,934 75,601 34,500 386,048 26,850 29,934 75,601 34,500 386,048 26,850 7,411,211 8,784,460 9,687,890 _10,583,400 10,119,736 1,137,754 121,015 (655,690) (1,209,080) (736,701) 7% 6% 5% - - 675,737 611,841 504,644 1,137,754 121,015 20,047 (597,239) (232,057) 8,202,634 9,340,388 9,369,071 9,461,403 8,864,164 9,340,388 9,461,403 9,389,118 8,864,164 8,632,107 (215,446) (196,531) (200,000) (200,000) (200,000) (2,631,989) (2,801,691) (3,354,885) (2,706,667) (2,984,840) $ 6,492,953 $ 61463,181 $ 5,834,233 $ 5,957,497 $ 5,447,267 BUDGET PROJECTION - GENERAL FUND Projection Projection Projection FY 2008 FY 2009 FY 2010 TOTAL ASSESSED VALUE $ 457,530,000 $ 471,255,900 $ 485,393,577 MILL RATE 4.50 4.50 4.50 REVENUE Property Tax $ 2,161,829 $ 2,226,684 $ 2,293,485 Sales Tax 5,100,000 5,253,000 5,410,590 State Revenue: Revenue Sharing//PERS Funding - - - Safe Communities and Muni. Asst. - - - Fish Tax 100,000 100,000 100,000 Other 55,000 55,000 55,000 Total State Revenue 155,000 155,000 155,000 Other Revenue: Licenses and Permits 50,000 50,000 50,000 Ambulance Fees 200,000 200,000 200,000 Interest 375,000 375,000 375,000 Other 750,000 750,000 750,000 Total Other Revenue 1,375,000 1,375,000 1,375,000 Total Revenue 8,791,829 9,009,684 9,234,075 Transfers From Other Funds Charges to other funds 1,027,940 1,058,778 1,079,954 Capital Projects - - - Enterprise 10,000 75,000 75,000 Trust Fund 15,000 22,000 30,000 Total Transfers 1,052,940 1,155, 778 1,184,954 TOTAL REVENUES AND TRANSFERS 9,844,769 10,165,462 10,419,028 EXPENDITURESIAPPROPRIATIONS General Government 1,969,341 2,107,195 2,170,411 Public Safety 5,084,111 5,439,999 5,603,199 Public Works 2,412,736 2,581,628 2,659,077 Parks, Rec. & Cultural 1,333,200 1,426,524 1,469,320 Total Operating Expenditures 10,799,388 11,555,346 11,902,006 Operating (Deficit)/Surplus before transfers (954,619) (1,389,884) (1,482,978) Transfers to Capital Projects - - - Other Transfers or Non Operating 26,000 26,000 26,000 26,000 26,000 26,000 Total Expenditure/Appropriation 10,825,388 11,581,346 11,928,006 Total Deficit/Surplus (980,619) (1,415,884) (1,508,978) Projected lapse 539,969 577,767 595,100 Adjusted (Deficit)/Surplus (440,650) (838,117) (913,878) Beginning Fund Balance 8,632,107 8.191,457 7,353,341 Ending Fund Balance 8,191,457 7,353,341 6,439,463 Encumbrances (200,000) (200,000) (200,000) Reserves and Designations (21822,338) (2,898,099} (3,008,300) Unreserved Undesignated Fund Balance $ 5,169,120 $ 4,255,242 $ 3.231,163 Budget os Fund 1 . Sewer Fund Revenues Usage Fees Hook-up Residential Water Commercial Water Residential Sewer Commercial Sewer Total Usage Fees Miscellaneous Revenues Penalty and interest Spec. Asmnt. Principal Sale of Assets Interest earnings Other Total Miscellaneous Revenues Total Revenues Expenditures Water Department Sewer Department WastewaterTreatment Plant Dept. Total Expenditures Contribution To/(From) Fund Balance Projected lapse (6%) Adjusted (Deficit)/Surplus Beginning Fund Balance Original Administration Actual Budget Projection Recommended FY 2005 FY 2006 FY 2006 FY 2007 $ 2,100 $ 1,500 $ 5,000 $ 5,000 286,601 315,700 317,800 317,800 128,063 157,300 140,000 140,000 820,475 921,760 920,600 920,600 350,885 424,480 387,700 387,700 1,588,124 1,820,740 1,771,100 1,771,100 29,912 18,000 18,000 18,000 20,925 22,000 22,000 - 48,174 33,000 65,000 40,000 3,002 2,500 2,500 2,500 102,013 75,500 75,500 60,500 1,690,137 1,896,240 1,846,600 1,831,600 390,545 650,368 653,332 603,761 205,225 312,248 313,248 483,741 612,800 717,967 719,527 706,176 1,208,570 1,680,583 1,686,107 1,793,678 481,567 215,657 160,493 37,922 - 100,835 252,916 107,621 316,492 413,409 145,543 686,574 1,133,181 1,208, 834 1,622,243 Residual Equity Transfers 40,693 Ending Fund Balance $ 1,208,834 $ 1,449,673 $ 1,622,243 $ 1,767,786