City Council (View All)
Wednesday, April 19, 2017
ASHLAND CITY COUNCIL
April 19, 2017
1175 E. Main Street
CALL TO ORDER
Mayor Stromberg called the meeting to order at 7:04 p.m. in the Civic Center Council Chambers.
Councilor Slattery, Morris, Lemhouse, Seffinger, and Darrow we present. Councilor Rosenthal was absent.
NEW AND MISCELLANEOUS BUSINESS
1. Discussion of policy priorities for the 2017-2019 Biennium
Mayor Stromberg explained the meeting tonight and tomorrow was a new approach to the budget process for the biennial budget for 2017-19. The idea originated with Councilor Slattery and Marsh three years ago. Department Heads proposed some projects and the Mayor was proposing one to rebuild the Reserve Fund.
At the April 3, 2017 Study Session, Council reviewed a list of projects drawn from the Council Goals meeting in fall 2016. Some were not relative to the BN2017-19 budget. The Mayor identified projects Council may want to prioritize. A list of potential revenue sources was included in the packet. Selected projects would need a revenue source to cover costs. Council could add or remove items from the list. At the April 20, 2017 meeting, they would identify their top three items, compile a list, work through the list in priority order, and identify revenue sources.
Interim Administrative Services/Finance Director Bev Adams explained the City was in the formulation stage of the budget with changes occurring daily. It was preliminary balanced and presently awaiting Council project goals.
On the expense side, Finance staff prepared all personnel projects beginning in November for the next biennium. The Public Employees Retirement System (PERS) and healthcare increases were a large item in the budget. PERS would cost $2,200,000 and healthcare would cost $948,000 over the next biennium. Salary adjustments were estimated at 2% for management. There were no new positions other than those identified with a corresponding revenue source. Materials and services were held to 0%. Some departments would show a negative increase while others will have an increase due to transferring duties and the costs associated with them. Staff prioritized capital outlay projects and identified revenue sources. Each department maintained Council approved core services. Add packages seeking funding were not allowed unless the department had a funding source. Finance asked departments to conserve and preserve in the current budget while maintaining service levels until June 30, 2017 to help the carryover going forward.
For the revenue side, Ms. Adams was just short of aggressive in order to provide some sort of buffer, and preserve the carryover for the upcoming year. The projected tax rates went right up to the edge of going over. Revenues were on the high side of projections. She did not recommend raising them any further. Every contingency was budgeted at the policy limit. Ending Fund Balances (EFB) that could not meet the financial policy threshold included the General Fund, Capital Improvement Plan (CIP) Electric, Telecommunication, Insurance, and Parks. The General Fund was at 98% of the financial policy and the rest did not meet the City’s policy level.
The additional cost for PERS above the normal cost was $2,200,000. The healthcare cost increase was 10% or $948,000. The increase in PERS was not due to current staff. They were 45% of the increase. The remaining 65% was from people who had retired. Of the $2,200,000, $1,750,000 was the new costs the City was being assessed. Only $450,000 made up current staff. It was a Tier 1 and Tier 2 problem for PERS. Ms. Adams confirmed the $2,200,000 cost to PERS and the 10% increase to healthcare was for the biennium and not annually.
Staff identified discretionary funds on the BN2017-19 Possible Revenue Sources document. Council could cut something from the existing budget or draw down the contingency or EFB. However, staff did not advise drawing down either.
Interim City Administrator John Karns provided an overview of the following Department Add-Ins:
- One Full Time Employee (FTE) in Wastewater Collection for the Public Works Department – funding source was built into the rates.
- One FTE Forest Division Position for the Fire Department – funding source from grants.
- One FTE Deputy Fire Marshall for the Fire Department – funded the first year by eliminating the Weed Abatement Coordinator, Temporary Clerk, and part time Inspectors. The EM would also provide funds. There would be a $64,000 shortfall possibly offset by increased inspections and plan check fees.
- One FTE Permit Concierge for the Community Development Department – funding source would be the General Fund.
- Community Development Training for the Community Development Department – funding source would be the General Fund.
- One FTE Senior Project Manager for the Public Works Department – funded from enterprise funds and costs rolled into projects.
Mayor Stromberg explained Council could consider items #4 and #5 and the remaining $64,000 on item #3. Public Works Director Mike Faught addressed item #6 and explained the Senior Project Manager would focus on large CIP projects. The CIP would fund the salary for this position. The position would report to the Engineering Services Manager.
Mayor Stromberg addressed the Add-ins with Possible Implications for Budget Parameters for BN2017-19 document. Council would review Item #3 and bolded items #4, 7, 9, 14, 17, 18, 22 and determine a revenue stream for each if they wanted it included in the next budget. During the next night’s meeting, they would prioritize those items. Council decided to review revenue sources first.
Mayor Stromberg reviewed BN2017-19 Possible Revenue Sources:
- 9cents/1000 Unassessed Property Tax to generate up to $220,240 in FY2017-18 and $227,900 for FY2018-19 for a total of $448,140.
- Appoint existing EE/City Recorder duties to generate $139,000 in FY2017-18 and $145,400 for FY2018-19 for a total of $294,000.
Council noted the City Charter dictated appointing and hiring a City Recorder within a specific timeframe. That individual would be paid what the current City Recorder was paid. Using an employee as a City Recorder was another discussion. Ms. Adams clarified if Council went this direction, existing employees would pick up various duties resulting in savings.
- Increase Water Fund Franchise Fee from 6% to 8% to generate $155,000 for FY2017-18 and FY2018-19 for a total of $310,000.
- Substitute Tourism $ for GF $.
- Marijuana Tax Subventions to generate $55,000 for FY2017-18 and FY2018-19 for a total of $110,000.
Council could earmark the money.
- Housing Trust Fund Balance had a one time amount of $166,000 earmarked for purposes allowed under the Housing Trust Fund Resolution.
Council removed revenue stream #2 and #4 and kept the rest for discussion. Council went on to review the Add-ins with Possible Implications for Budget Parameters for BN2017-19 document and chose the following for further discussion at the next night’s meeting:
3. Police Staffing Increase.
4. CEAP implementation.
9. Housing Trust Fund.
14. Rebuild Reserve Fund.
17. Assistant City Administrator.
18. Citywide Urban Design Plan.
22. Emergency Shelter Contract.
Mayor Stromberg would compile the list and the Ms. Adams would include financial provisions. Council will prioritize the list and determine funding for the highest priorities. Ms. Adams would provide percentages of fund balances.
Meeting adjourned at 8:41 p.m.
Dana Smith, Assistant to the City Recorder John Stromberg, Mayor