HomeMy WebLinkAboutAgenda Packet 09/24/2008
WAS H I N G TON, U. S. A.
AGENDA
CITY COUNCIL MEETING
321 East 5th Street
September 24, 2008
SPECIAL MEETING - 5:00 pm
FORTANGELES
A. CALL TO ORDER - Special Meeting (5:00 p.m.)
B. ROLL CALL
PLEDGE OF ALLEGIANCE
C. WORK SESSION
1. Proposed 2009 Preliminary Budget adjustments.
1. Consensus on adjustments.
E. ADJOURNMENT
NOTE: HEARING DEVICES AVAILABLE FOR THOSE NEEDING ASSISTANCE
MAYOR TO DETERMINE TIME OF BREAK
September 24, 2008 Port Angeles City Council Meeting Page - 1
~ORTANGELES
WAS H I N G TON, U. S. A.
CITY COUNCIL SPECIAL MEETING
1.
CALL TO ORDER - SPECIAL MEETING:
II. ROLL CALL:
Members Present:
Mayor Braun
Deputy Mayor Wharton
Councilmember Di Guilio
Councilmember Kidd
Councilmember Perry
Councilmember Rogers
Councilmember Williams
Staff Present:
Interim Manager Osterman
Attorney Bloor
Clerk Upton
G. Cutler
T. Gallagher
D. McKeen
N. West
Y. Ziomkowski
September 24. 2008
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m. PLEDGE OF ALLEGIANCE:
Led by: ~1 "f~ Orr,.p rrJ),O.k _ ~..A...L.--'
· ~ORTANGEtES
WAS H I N G TON. U. S. A.
CITY COUNCIL SPECIAL MEETING
Attendance Roster
DATE OF MEETING: September 24. 2008
LOCA TION: City Council Chambers
· ~ORT.ANGELES
WAS H I N G TON, U.S. A.
CITY COUNCIL SPECIAL MEETING
Attendance Roster
DATE OF MEETING: September 24. 2008
LOCATION: City Council Chambers
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· ~ORTANGEL.ES
WAS H I N G TON, U. S. A.
CITY COUNCIL SPECIAL MEETING
Attendance Roster
DATE OF MEETING: September 24. 2008
LOCATION: City Council Chambers
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INTRODUCTION
GOOD EVENING. FOR THOSE WHO I HAVE NOT MET AS YET, MY NAME IS
JERRY OSTERMAN AND I AM SERVING AS INTERIM CITY MANAGER WHILE
A SEARCH IN UNDERWAY FOR A NEW CITY MANAGER ESTIMATED TO
START WORK IN JANUARY OF 2009.
THIS IS A SPECIAL CITY COUNCIL WORK SESSION SCHEDULED WITH THE
CONCURRENCE OF MAYOR BRAUN FOR THE CITY COUNCIL TO CONSIDER
ADJUSTMENTS TO BALANCE THE "PRELIMINARY" 2009 BUDGET.
PREP ARING AN ANNUAL BUDGET IS A PROCESS OF EVOLUTION WHICH
USUALLY BEGINS IN OUR CASE IN JUNE FOR THE FOLLOWING CALENDAR
YEAR.
WE ARE A MUNICIPAL CORPORATION AND OPERATE UNDER THE REVISED
CODE OF WASHINGTON AND MUST COMPLY WITH ALL STATE AND
FEDERAL ACCOUNTING AND REPORTING REQUIREMENTS.
IN EARLY AUGUST, OUR FINANCE DIRECTOR REVIEWS AND BEGINS
PROJECTIONS OF CITY REVENUES, RESERVES, EXPENDITURES AND
FINANCIAL CAPACITY. DEPARTMENTS REVIEW THEIR CURRENT
OPERA TIONAL LEVELS AND FUTURE NEEDS, AS WELL AS COMMITMENTS
TO ADOPTED PLANS, SUCH AS:
GROWTH MANAGEMENT ACT
TRANSPORTATION PLAN
LAND USE PLAN
UTILITIES COMPREHENSIVE PLANS
STORM DRAINAGE MASTER PLAN
CAPITAL FACILTIES PLAN
FIRE MASTER PLAN
PARK PLAN
ECONOMIC DEVELOPMENT PLAN
POLICE MASTER PLAN
HISTORICAL PLAN
,
.,
THESE DEPARTMENT REQUESTS ARE AND HA VE BEEN UNDER REVIEW
WITH CITY COUNCIL COMMITTEES. DURING THOSE REVIEWS, IT BECAME
CLEAR THAT MAJOR POLICY PROGRAM DECISIONS WOULD NEED TO BE
MADE IN ORDER TO BALANCE THE 2009 ANNUAL BUDGET.
WITH THAT THOUGHT IN MIND, THIS MEETING WAS SCHEDULED AS A
SPECIAL WORK SESSION FOR CITY COUNCIL MEMBERS TO REACH
CONCENSUS ON SOME ISSUES SO THAT A PRELIMINARY BUDGET CAN BE
PREPARED FOR THE PUBLIC TO REVIEW BY NOVEMBER 3RD.
PUBLIC INPUT WILL BE ACCEPTED AT CITY COUNCIL PUBLIC HEARINGS
ON NOVEMBER 4, NOVEMBER 18, AND DECEMBER 2, AFTER WHICH
CITY COUNCIL WILL APPROVE A FINAL BUDGET FOR 2009.
..
FINANCE DIRECTOR YVONNE ZIOMKOWSKI WILL NOW PRESENT SOME
INFORMATION CHARTS FOR CITY COUNCIL AND THE PUBLIC TO VIEW,
AFTER WHICH CITY COUNCIL MEMBERS WILL DISCUSS PROPOSED
REVISIONS TO BALANCE THE PRELIMINARY BUDGET..... ...YVONNE
General Fund Savings
Following are some of the proposed
reductions in General Fund expendi-
tures in 2009, and the associated
savings if these changes are imple-
mented.
o Reduce citywide travel/training
and supplies by 10% - $1 6,400
0' Personnel reduction and re-
organization in Finance, and City
Manager Departments - $60,000
o Eliminate Senior Center part-time
employee - $11,500
o Transfer street functions to Storm-
water Utility - $235,000
o Reduce vehicle replacement pro-
gram -$288,000
o Reduce United Way contribution -
$62,50'0 ,:,':.,.;,,,,
o Reduce Fine Arts Center support -
$27,500
o Reduce Humane Society contract
- $26,000
o Reduce Art Feiro Marine Life
Center support - $22,500
o Eliminate low-use neighborhood
parks - $25,000
o Close William Shore Memorial
Pool - $400,000
o Other reductions - $206,500
~--C-'---:-~-----;-:-~--J
MAJOR CHANGES TO PROPOSED 2009 BUDGET
Preparing a balanced budget for
2009 continues to be a challeng-
ing process. It is the policy of
the City of Port Angeles to
maintain a level of expenditures
that enhances the safety and
well-being of residents in our
community. At the same time, it
is necessary to avoid preparing a
current budget that is balanced
at the expense of future budgets.
For several years, the City has
balanced budgets by making cuts
in areas such as travel! training
and office supplies, and through
attrition.
Due to voter initiatives such as
Initiative 747, which limits prop-
"erty.:tax increases,to 1 %, and the
decline of the current economy,
the City's revenues are in-
creasing at a slower rate
than expenditures.
Several sources of
tax revenue are
either decreasing or
are growing at a rate
below the cost of services
that these funds provide for,
For example, the City's three
largest revenue sources
(property, sales, and utility taxes)
comprise nearly 60% of all Gen-
WE WANT TO HEAR FROM YOU
The City Council wants your feedback on the proposed changes
to the 2009 Budget. You can respond in one of the following
ways:
E-mail -Council@cityofpa.us
Phone - City Manager's Office, 417.4500
Mail - P.O. Box 1150, Port Angeles, WA 98362
Public Hearings - November 4 & 18, December 2,
7:00 pm
Additional budget information can be found on the City's web-
site at www.cityofpo.us.
eral Fund revenues. These reve-
nue sources are expected to
increase 1.2% in 2009. However,
General Fund expenditures' are
estimated to increase over 4%.
Under current conditions, the
gap between General Fund
revenues and expendi-
tures will continue to
widen.
Rev/Exp
$25,000,000
Forecast for the future
2009, for the purpose of prioritiz-
ing critical services that provide
high quality basic services such as
'. utilities, fire and police p'rote2tlbh:'
street maintenance, and commu-
nity development, Other non-
essential services or programs will
be reviewed based on the benefit
to the community as a whole and
the cost involved in providing the
service,
Mayor and City Council
members have been working
vel)' hard with City staff mem-
bers over the past several weeks
to prepare a preliminary budget
for 2009, A special work session
is scheduled for September 24,
Reserves
_ Re\.enues
--4!1- Re\.enue less Expenditures
c:::::J Expenditures
-It- Reser\.es
~~.,
A preliminary budget will be avail-
able to the public November 3,
2008, Comments from citizens
will be received at public hearings
held in November and December,
2008,
The General Fund had
nearly $4 million in
reserves at the end of
2007. This balance will be
depleted by 2011,
assuming a 1 % growth in
revenues, a 4% growth in
expenditures, and
$500,000 for capital
projects annually.
"Provide quality basic ser-
vices in an efficient, deliber-
ate and predictable manner
with fiscal responsibility."
City of Port Angeles
Mission
TOUGH CHOICES AHEAD...
The City Council recognizes that
the City can no longer sustain
services at current levels. Conse-
quently, some tough choices
were made that either eliminate
services or enhance revenues.
'The most significant change
recommended by Council is the
closure of William Shore Memo-
rial Pool effective December 31,
2008. This change will save the
City approximately $400,000
annually to spend on other es-
sential services. This would also
save citizens over three million
dollars of funds needed to repair
and modernize a facility that is
nearly 50 years old.
William Shore Memorial Pool
Historical Revenues and Expenditures
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$0
~ ~ ~ ~ ~ ~ ~ ~ ~ ~
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.... +-. . . ........-
-+-- Revenues ---- Expenditures
...
Taxes used for street maintenance, such as
property tax revenue and motor vehicle fuel
tax, have remained the same or have in-
creased minimally compared to the rising cost
of maintaining city infrastructure. General
Fund continues to absorb more of the cost of
supporting this service. In 2009, it is esti-
mated that the General Fund will increase
support to the Street Fund by 48% over 2008.
'Str~~f.Fund Financial Trends
'.:,.:/*2::;),
$2,000;0
$1,500;000
$1,000,000
$500,000
$0
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-+-- Street Expenditures
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The General Fund cannot sustain these ser-
vice levels while revenues remain the same or
continue to decline. If the City Council
doesn't make some tough choices in 2009,
future budgets will be facing drastic cuts in
essential services such as street mainte-
nance/ repairs, fire and police services, and
community development programs.
- General Fund Support ---..- Tax Revenue
Presented by:
Yvonne Ziomkowski
H w did we 9 t her ?
The budget has become more and more
difficult to balance, but it didn't happen
overnight. . .it has been growing for
years.
II1II
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t h r ? ( nt.)
Revenue Limitations:
Closure of Rayonier Mill in 1997
City lost major revenue source - $800K
Voter's Initiatives
Motor Vehicle Excise Tax - $350K
Property Tax limitations - $200K
How di we get here? (cont..)
Increasing Costs - approx. $1 M
. City absorbed additional services
Jail
· Prosecution
· Voter registration
· Election Costs
GASB financial reporting requirements
Inflation
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di we get her ? (c nt.)
No major service cuts were made in previous
budgets because:
· City was frugal and pro-active with money
· Only did the bare minimum in street repairs - $150K
for projects vs. $500K - 700K in previous years
Did more work with fewer resources
Cut back on discretionary items such as
travel/training, and office supplies
Focused on Economic Development programs
These issues are FINALLY catching up!
20,000,000
18,000,000
16,000,000
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
artf II
General Fund RevenUes, Expenditures, Reserve~
1998 1999 2000 2001 2002 2003 2004 2005
2007 2008
est
1- Re\€nues c:::::J Expenditures ~Rese[\€s I
les Tax - 1992-2 12
II1II\1 $ Amt adjused for Inflation c:::l $ amount recieved
____% Change with inflation
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2 09-2012 Projections
Rev/Exp
$25,000,000
$20,000,000
Forecast for the future
Reserves
$8,000,000
$4,000,000
J& Revenue less Expenditures
I Expenditures
___ Reserves
- 1 rojections
If we don't make difficult decisions
now, in 2009-2010 we will be below the
minimum level of reserves. . .
· .. and by the year 201 0-2011 the City
will have reserves left.
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Created a list of essential
and mandated services
Created a list of "nice to
have" and "wants"
Evaluated ALL programs
Created a proposal of
possible service cuts and
revenue enhancements
to present to Council
committees
?
IiII
at did staff do? (cont.,)
Staff held meetings with:
Finance Committee
Parks Oversight Committee
. . . to review the proposed
preliminary budget and
potential cuts
su ti ns fr m Staff:
Staff reduction due to reorganization in Finance and
CM ($60K)
Reduced travel/training and supplies ($16K)
Decrease vehicle replacement program ($288K)
Reduce support by 50% to:
United Way ($62.5K)
Art Feiro Marine Life Center ($22.5K)
Fine Arts Center ($27.5K)
Humane Society ($26K)
· · .And ELIMINATE support of those services in 2010
.' . 'j-- "-...
u gestions from taff (cont.):
Transfer stormwater functions from street to stormwater utility
($235K)
Cut support to economic development ($60K)
Cut back on beautification program ($20K)
Eliminate low-use neighborhood parks ($25K)
. Cut ballfield maintenance ($20K)
Change City Hall operating hours to 9am-4 pm (utility savings)
Eliminate pool operations ($400K)
Other reductions ($186K)
TO L EDUCTIONS = approx. $1.5
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Suggestions from Sta (co t.):
Use of reserves for:
IT projects ($750K)
· 2008-2009
Street projects ($350K)
ossibl
venue nhancements:
Increase Medic I rates for cost of living ($30K)
I ncrease cemetery fees ($23K)
Increase user fees for recreational programs ($25K)
Increase parking fines ($35K)
Increase water/wastewater utility tax rates from 80~
to 10% ($170K)
Levy tax on long-term parking ($8K)
Impose false alarm fees ($3K)
TOTAL REVENUES = $294K
. .
..
. "
Revenue Enhancements (cantm):
Other revenue options for consideration
include:
· Transportation Benefit District for street programs
only ($340K)
. Property Tax levy lid lift - requires voter approval
and valid up to 6 years only ($2 - 2.5M)
· Increase tax on cell phones (currently 60/0)
I e tal e uests
Requests recommended by the Finance
Committee and included in proposed 09 budget:
Meter reading equipment
Fire Dept. security fence
Cemetery burial maps
.25 FTE Gateway caretaker
Peabody Street construction
Street Comprehensive Plan
IT software requests
TOTAL impact on General Fund = $200K
Street rograms f r 2009
Peabody paving ($740K) - partially funded by grants
Street chip-sealing & other projects ($650K)
re are we now?
By implementing the proposed changes, mainly:
Closure of Pool on December 31,2008
Use of reserves for:
· IT projects
· Equipment replacement
· Street projects
. . .We are able to BALANCE the 2009 GF &
Street Budget at $ II
Don't Forget about 2010 & 2011
$25,00
$23,000,000
$21,000,000
$19,000,000
$17,000,000
$15,000,000
Revenues vs Expenditure
A Revenues
Your decisions TODAY will impact the Budget in future years
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II II ----- .. Streets
. Police
.& Fire
Does NOT include major capital projects, such as Civic Field (est. $2M)
Let's look at Pool
General Fund
support has
increased
nearly 2300/0
from 1991-2008. .
I
City staff met with officials from:
YMCA
Port Angeles School District
Clallam County
· . . to negotiate transfer of pool.
o I Revenues
Swim Club - $25/hr practice, $40/hr swim meets
. School Teams - $25/hr practice, $25/hr swim meets
. Coast Guard - pays discounted early-bird rate
Fees cover only 25% of cost of pool operations.
To recover full costs, rates would need to be raised 4-5 times current
levels, plus 10-150/0 annually. For example:
$2.50 current youth rate would be RAISED to $10.00 minimum,
most likely r~sulting in REDUCED participation
I
int
ance
Pool facility is nearly 50
years old
Major renovation and
modernization is REQUIRED
mmunity Servic s sup rt
by City
These are Non-Mandated programs
· Pool ($400K City support)
Senior Center ($120K)
· Cemetery ($20K)
Recreational Programs ($230K)
· Special Events
· Sports Programs
· Youth/Family Programs
Park Facilities/Ballfields ($1.4M)
Library/Senior Center bonds ($281 K)
munity rvi 5 5 rte
it ( nt.)
These are Non-Mandated programs
Fine Arts Center ($55K)
Art Feiro Marine Life Center ($45K)
· OPNET ($80K)
United Way ($125K)
Clallam Business Incubator ($1 OOK)
Economic Development Council ($20K)
PADA Main Street Program ($20K)
Peninsula College Center of Excellence ($1 OK)
Community Servic s sup
y City (cont.)
TOTAL Support of
Community Services =
rt
Il!Il
t r Ne s
2007 CI P projects "on hold"
Funding for general government, IT &
transportation capital projects identified
in CFP = $85.5M through 2014
What's next?
Staff needs policy consensus decision by
City Council to approve the adjustments
to the 2009 budget
u Ii ring rocess 0 2
t
November 4 - Revenues
November 18 - Revenues & Exp.
December 2 - Final public hearing and
adoption of budget