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HomeMy WebLinkAboutResolution No. 2025-04KENAI CITY OF KENAI RESOLUTION NO. 2026-04 Sponsored by: Administration A RESOLUTION ADOPTING GOALS TO GUIDE THE PREPARATION OF THE FISCAL YEAR 2026 ANNUAL BUDGET. WHEREAS, at the Fiscal Year 2026 Budgetary Goals Work Session on December 4, 2024 the Council discussed and accepted public comment on goals and objectives to guide the City's fiscal year 2026 budget development; and, WHEREAS, the adoption of budget goals helps to ensure the budget is prepared in a manner which meets the needs and desires of the community and is consistent with the desires of the Council; and, WHEREAS, the Council has discussed and collectively adopted the Broad Statement of Purpose and Goals for the preparation of the Fiscal Year 2026 City of Kenai Budget as provided below; and, WHEREAS, the City Manager will utilize the adopted Broad Statement of Purpose and Goals to guide the creation of the City's Draft Budget which will be submitted to the Council for consideration and adoption. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA: Section 1. The Council adopts the following Fiscal Year 2026 Budget Goals and Broad Statement of Purpose: Broad Statement of Purpose The goal of the City is to prepare and adopt a fiscally responsible budget that meets the needs and priorities of the community it serves. A fiscally responsible budget ensures revenues, taxes, and fees are sufficient but not excessive to fund current operations and contribute to the long-term maintenance of City infrastructure used to provide services. Meeting the needs and priorities of the community means prioritizing essential services while being mindful that non -essential services such as parks, recreation, arts, library, and senior services have significant importance in creating a vibrant, well-balanced community in which individuals desire to live and businesses seek to locate. Council's adoption of these goals is intended to guide the Administration through its preparation of the FY2026 annual budget. Specific Goals 1. The goal is to avoid a tax increase while meeting the City's operational and long-term financial obligations. Prepare a budget for consideration that prioritizes maintaining the City's current mill and sales tax rates while allowing for flexibility to adjust rates only if necessary to ensure fiscal stability and compliance with the General Fund, Fund Balance Policy codified in KMC 7.25. 2. Complete a review of the City's salary schedule and pay plan. Ensure the plan offers competitive compensation comparable to other public employers, enabling the City to recruit and retain competent employees while safeguarding critical services and infrastructure support. Incorporate a salary increase not to exceed inflation, as measured by the 2024 Alaska Consumer Price Index, second half over second half, if necessary to maintain competitive compensation with other public employers. New Text Underlined; [DELETED TEXT BRACKETED] Resolution No. 2025-04 Page 2 of 3 3. Complete a review of the City's health, dental, and life insurance benefits to ensure they remain sustainable while maintaining the same quality of coverage. Ensure the insurance provides adequate benefits that are comparable to those offered by other public employers. Ensure employee costs for these benefits are comparable with those of other public employers, and if the comparison shows that an increase in the employee cost share is warranted, limit the increase to no more than 1 % of the total program costs. For FY2026, this would result in an employee cost share of no more than 14% of the program's total costs. 4 Seek opportunities to achieve cost savings and efficiencies while maintaining operational effectiveness and service quality, through a transparent budget development process. This process will include performance measures and a thorough review of past expenditures, future needs, and priorities to ensure informed decision -making and responsible resource allocation. 5. Compile a list of capital projects, which are projects that cost $35,000 or more, for Council adoption and ensure that the minimum investment in maintaining City infrastructure over time equals the depreciation, an accounting process by which the cost of an asset is spread over its useful life, recorded annually on City capital assets and infrastructure. The City's FY2024 depreciation by fund and function were: General Fund: General Government $ 105,679 Public Safety 271,787 Public Works 839,780 Parks, Recreation & Culture 346,213 Social Welfare Services 68,189 $1,631,648 Airport Fund: $2,314,695 Water & Sewer Fund 1.004,227 Total All Funds $ 50.570 6. Adjust rates, charges, and fees across all funds in line with inflation, as measured by the Annual Alaska Consumer Price Index for All Urban Consumers. Any increase in the monthly rents at Vintage Pointe for existing tenants as of June 30, 2025, shall be capped at no more than $50.00 per month. 7. Project ending fund balance/retained earnings of at least 50% of the FY2025 budgeted expenditures net of any projected lapse for the Airport, Water & Sewer, Personal Use Fishery, and Congregate Housing Funds. Ensure any use of fund balance is for one-time or capital purchases and not for reoccurring expenditures/expenses so that the ending fund balance for each fund is not less than: Airport Fund $1,842,073 Water & Sewer Fund 1,562,025 Personal Use Fishery Fund 268,898 Congregate Housing Fund 321,263 New Text Underlined; [DELETED TEXT BRACKETED] Resolution No. 2025-04 Page 3 of 3 Section 2. That this Resolution takes effect immediately upon passage. PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, THIS 15T" DAY OF JANUARY, 2025. QST: ane C, City Clerk Approved by Finance ,Q T Brian Gabriel Sr., Mayor New Text Underlined; [DELETED TEXT BRACKETED] K., N A City of Kenai 1210 Fidalgo Ave, Kenai, AK 99611-7794 1907.283.7535 1 www.kenai.city MEMORANDUM TO: Mayor Gabriel and Council Members THROUGH: Terry Eubank, City Manager FROM: Dave Swarner, Finance Director DATE: January 10, 2025 SUBJECT: Resolution 2026-04 — FY2026 Council Budget Goals Resolution 2025-04 will formally establish Council's goals for the City's FY2026 Budget. The adopted goals are intended to guide the City Manager in his preparation of the budget which is scheduled to be provided to Council in April for its consideration and adoption prior to the June 10t' deadline established in KMC 7.25.010(g). The establishment of goals by the City Council early in the budget process is considered a best practice, one the administration believes should be incorporated into the City's budget process, as it provides guidance to the City Manager in his compilation of his draft budget and it provides greater transparency to the process. The preparation of the FY2026 City Budget will be challenging, City revenues continue to increase but at a slower pace than the City's expenditures. Sales tax revenue is continuing to increase in an upward trend but it is not meeting the 1.5% rate of increase that was budgeted for FY2025. Council's establishment of specific, measurable, attainable, relevant and time based (SMART) goals will increase the likelihood of a smooth and successful budget process in FY2026 and future years. These goals were discussed and public testimony was heard at a work session held on December 4th. You support for adoption is respectfully requested. a K NA City of Kenai 1 210 Fidalgo Ave, Kenai, AK 99611-7794 1907.283.7535 1 wwwkenai.city [OTA GCS' • 1e l TO: Mayor Gabriel and Council Members FROM: Alex Douthit, Council Member DATE: January 10, 2025 SUBJECT: Proposed Amendment to Resolution 2026-04 — FY2026 Council Budget Goals The City, recognizing the importance of community groups and/or organizations that provide benefits for residents, has provided financial support for the operations and projects of these groups and organizations. To improve the transparency and accountability in granting and the use of community funds, I propose the addition of a FY2026 Budget Goal for the formalization and adoption of a policy regarding issuing and administering operating and capital grants to community organizations. Proposed Goal 8 The City Manager in coordination with the City Clerk will develop and propose for Council's consideration and adoption, a policy to be utilized for the issuance and administration of operating and capital grants to community groups and/or organizations that provide benefits to City residents. Your consideration and support are respectfully requested.