Loading...
HomeMy WebLinkAbout1997-04-10 Council Minutes - Budget Work Session0 BUDGET WORK SESSION APRIL 10* 1997 7:00 P.M. KENAI COUNCIL CHAMBERS Council present: Williams, Smalley, Swarner, Measles, Bannock, Moore (arrived at 7:20 p.m.), Bookey (arrived at 7:30). Staff present: Ross, Semmens, Howard, Kornelis, Kohler, Burnett, Frates, DeForest, Porter, Ernst, Elson Others present: Colleen Ward, Steve Kadel (Peninsula Clarion) Lquai 800nom aOutlook- For Colleen Ward (K. Scott and Associates) gave a presentation as to what was planned for the Kenai Economic Outlook Forum project to be held on April 26. Ward wanted to make sure the proposed Forum Outcomes were what the Council had in mind. She said if the Council had other ideas, to let her know as soon as possible. A Forum Draft Agenda was reviewed. There were no objections to the proposed agenda. Ward showed Council a list of proposed Forum Presenters. Mayor Williams asked Ward to contact Doug Jung with more details. Ward said Participant Packets would be sent out prior to the meeting but some will be available at the door for the public. Ward discussed the role of Councilmembers for the forum. She said K. Scott and Associates would like the Council to serve as recorders for the group breakout sessions. The small groups were to then go back into one large group and discuss results. Swarner said she would like information on how the airline schedules were impacting the community. Ward asked if the Council wanted K. back in two weeks and give a wrap-up before the forum. It was decided a at the April 24 work session. Scott and Associates to come of how things are going presentation could be given Ross reported the Kenai Recreational Ice Rink Task Force intended to make a presentation to the City Council for funds for an ice rink. Ross suggested the project be presented to Alaska State Parks and the National Park Service in conjunction with the idea that revenues derived from the sale of the lots adjacent to the golf course be used to develop this recreational project. Ross said in that instance, money for a proposed rink wouldn't need to come from the general fund balance. He asked Council to consider the idea. KENAI CITY COUNCIL BUDGET WORK SESSION APRIL 10, 1997 PAGE 2 Fire Rescue Helmets Ross reported he spoke with Dave Ahlberg (owner of Kitchen Express) regarding infra -red helmets. Ross said there would be a meeting on the 15 at 2:00 with Chief Burnett. The cost is $25,000 per helmet. Burnett had previously told Ross, two if any, should be purchased because two firemen were sent into burning buildings together. The helmets are not budgeted. Ross thought it would be helpful if a survey was done of groups that had purcfhased the helmets to find out their experiences if we determine to pursue this further. FY98 Rug t_Ot►_Qryiew Ross distributed a memorandum with budget revenue and projection scenarios for FY98 - FY03. He said there haven't been projections in past budgets. Ross said page 1 of his memorandum outlined the financial basis of the scenarios. Ross said he thought the FY98 budget was an optimistic one. Ross said he would like Council to discuss the enterprise funds first, then the general fund budget. He said the general fund budget was based on a 2% cut in municipal assistance and revenue sharing funding. It now looks as though there will be a 5% cut and the new numbers will be reflected in the final budget. Ross explained that Scenario 1 represents pulling out $1 million for the equipment reserve fund and $600,000 for the animal control shelter. He asked Council to review the scenarios and compare the mill rates and appropriations from fund balance. He said in Scenario 2, we would be in trouble as early as FY01. He asked Council to look at Scenario 3 at FY03; with an 8.20 mill rate, the fund balance is unacceptable. Ross then asked Council to look on page 2 of his memo.at the section titled "Recommendations for Reductions in FY98 General Fund Budget". The bottom of Scenario 4 identifies what these reductions will do. Ross said he didn't think these reductions were draconian. He said, regarding FY02, we're still in trouble with over $1 million appropriated from fund balance and the unreserved/undesignated fund balance was unacceptably low. Regarding Scenario It Ross said if the administration makes these cuts and does as outlined in the memorandum, the FY03 appropriation of fund balance is $892,335. The unreserved/undesignated fund balance is nearly $3 million. KENAI CITY COUNCIL BUDGET WORK SESSION APRIL 101 1997 PAGE 3 Ross asked that Council not cut operation portions of this budget. He said if training is cut, a few dollars will be gained, but not what is needed. He would like employees to have the tools and training to do their jobs. He asked the Council to consider next year's budget a guide for Council and Administration. If the economic picture goes up, we can change the plan. Attached to Ross' memorandum are justifications for personnel position reductions. He said when a position comes vacant he would like to take a look at the position and have it justified. He asked Council to read and examine the handout before the next work session and to contact him if they had questions. Williams stated he appreciated the time and effort that was put into the draft budget document. He pointed out that for many years the City has projected taking large sums from the fund balance but didn't use all of it. The fund balance continues to grow even when we are taking money out. Williams said he was • optimistic about the economy and felt the draft budget was too conservative. Ross stated that we don't spend about 8% but that margin is narrowing. Semmens added because of the equipment reserve fund, we guarantee the City is not going to spend at least $300,000 of the budget. Ross reminded Council that $300,000 is not in this budget. Ross said the budget was based on the economic reality seen. He said if we are wrong, adjustments can be made. Williams asked if the $631,937 appropriation of fund balance for FY98 would be a true number or will we see it be less based on past history. Semmens answered he thought that close to 5-7 percent will not be spent but there will be approximately $200,000 of encumbrances. Ross said page 18 of the draft budget will be replaced. Williams said he thought the mill rate should be increased to match the loss of municipal assistance and fish tax. This way, the taxpayers would clearly understand why the mill rate is going UP* Finance Director Semmens reviewed the budget using the overhead projector. He distributed graphs showing the following funds: All Funds - Revenue Sources; All Funds - Expenditures by Object; General Fund - Revenue Sources; General Fund - Expenditures by Function; General Fund - Expenditures by Object; Enterprise Funds KENAI CITY COUNCIL . BUDGET WORK SESSION APRIL 101 1997 PAGE 4 - Expenditures by Function; Enterprise Funds - Expenditures by Object; Special Revenue Funds - Expenditures by Function; and Special Revenue Funds - Expenditures by object. Semmens stated there was to be a change in the draft document because expenditures were overstated by $50,000. He said in FY98 the City would pay off a debt service for 1967 bonds. There was some discussion regarding the formula for motor vehicle registration. Mayor Williams felt the City was being shortchanged. Semmens stated fish tax was anticipated at 25% - 30% over last year. Of that, the State gets 50%; the Borough 25%; and the City 25%. Serpens said historically the number put in the draft budget is not out of line. -oongreaate Housing Fund is Porter reported there was money in the budget for repairing windows. They wished to replace windows in the living room. It may be necessary to replace windows in some of the bedrooms out of the FY97 budget. She said there was a small increase in Administration. She said Repairs and Maintenance is a guess. The building will be five years old in September. No changes were made to the draft budget. j2enior Citinen Title 111 Orant Fund Porter said overtime has decreased. They have increased their fundraising. There is no City money involved in this account, senior a-t ne soro gh ar_a t Fund Porter reported some money may come out of the unencumbered fund balance (rather than from the general fund) to purchase a new stove, a TV set and a computer. -other RisgaooAjon Ross reminded Council he would like some direction at the Council meeting regarding the lots on Lawton. Williams reported there would be representatives from BP at the • next Council meeting to discuss fire training facilities and how KENAI CITY COUNCIL BUDGET WORK SESSION APRIL 10e 1997 PAGE 5 to finance them. Williams said he would like to see about expanding services. Ernst reported Lisa and Bob Priewe wished to start a new airline passenger service at the Kenai Airport. Ernst said he would like to lease them the space between ERA and SouthCentral Air. Williams stated he would like to see more advertising money in the budget as soon as possible for the ARFF project. Ernst said the FAA expects a decision to be made for $6.2 million in discretionary funds by July 1. Smalley stated he told Barb Nord to contact Ross regarding which meeting the Beautification Committee should attend regarding banners. 0 The work session ended at approximately 9:30 p.m. Notes transcribed and pr pared by: ft • Clerk APPROVED BY COUNCR. 7 DAB