HomeMy WebLinkAboutAgenda Packet 01/28/2014
1
CITY OF PORT
ANGELES
Long Range Financial Plan
January 28, 2014
2
Agenda
Review of Work Accomplished to Date
•
Financial Projections
•
General Fund
Economic Development Fund
Street Fund
Real Estate Excise Tax I & II Funds
Debt Service
Policy Development
•
Policies receiving General Consensus During 2013 Review
New and/or Additional Policies for Consideration
Setting Program & Service Delivery Priorities
•
Proposed Future Meeting Schedule
•
Approaching the End
•
Questions, Comments & Requests from Council
•
Adjournment
•
3
Why Long-Range Financial Planning?
Long-Range Financial Planning (LRFP) will assist the City in
•
moving from:
A reactionary budgeting process to a strategic process that budgets for
•
financial sustainability
Decisions made today can significantly affect tomorrow
•
Decisions not made today can compound problems in the future
•
A staff-driven budget process to a Council-driven budget process
•
Council adopts policy direction & staff implements the policies
•
The LRFP will increase confidence in City government
•
Within the City:
•
•Residents & business will have better understanding of how the City collects
revenue and how its spend the money on identified priorities
•Employees, unions and special interest groups will have better knowledge
regarding the City and its financial condition
External to the City:
•
•Bond rating agencies will have greater assurance that the City is willing and able to
address current and future financial challenges
•State and federal agencies will have better information to better understand “ability
to pay” concerns and the need for funding assistance
4
General Fund Observations
General Fund is in relatively good shape, currently
•
Current revenue & expenditure projections indicate
•
IF
substantial deficit going forward there are no changes
to existing program & service levels
Need to establish appropriate policy direction for both
•
short and long-term –revenues, expenditures, debt
Council will need to establish short and long-term
•
priorities and assign resources in alignment with priorities
5
Forecast Disclaimers
The initial forecast in this report will undergo modification
•
based on:
Council adopted Long-Range Financial Plan decisions
•
Revenue & expenditure adjustments necessary to re-align funding
•
from utilities to the General Fund and other similar matters
Changes adopted by the Washington State Legislature as part of the
•
2014 legislative session
Changes in the local economic environment including:
•
New business development;
•
Closure of existing businesses; and
•
Other local economic factors
•
The forecast will be revised for each workshop to factor in economic
•
data that could impact decision making by Council
6
General Fund
Revenues & Expenditures History
200420052006200720082009201020112012'13 Pre. Y/E
Revenue
14,539,45714,977,24115,536,20816,757,92517,260,34817,106,99517,919,51418,625,85318,025,36619,059,810
Expenditures
14,939,85815,859,83916,551,07916,530,92518,960,34817,660,28117,278,69518,685,38019,126,83319,161,640
Net Gen. Fund Subsidy
(400,401)(882,598)(1,014,871)227,000(1,700,000)(553,286)640,819(59,527)(1,101,467)(101,830)
Un-assigned Fund Balance3,917,9413,909,5023,730,2024,949,2554,398,0234,273,1494,242,7944,421,1053,528,9953,570,995
$20,000,000
Revenue:
Compound Growth Rate 2004 –
$19,000,000
2014 = 2.54% w/o added
Property Tax from Streets in
2013 + 2014
$18,000,000
$17,000,000
$16,000,000
Expenditure:
$15,000,000
Compound Growth Rate 2004 –2014 =
2.26% w/o Gen. Fund Subside to Streets in
$14,000,000
lieu of Property Tax for 2013 + 2014
$13,000,000
$12,000,000
200420052006200720082009201020112012'13 Pre. Y/E
RevenueExpenditures
7
General Fund
Revenues & Expenditures Forecast
'14 Pre Y/E2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Revenue
18,884,82619,622,00020,095,00020,584,00021,089,00021,612,000
Expenditures
18,332,43919,740,00020,337,00020,954,00021,594,00022,257,000
Net Gen. Fund Subsidy
552,387(118,000)(242,000)(370,000)(505,000)(645,000)
Un-assigned Fund Balance3,570,9953,452,9953,210,9952,840,9952,335,9951,690,995
$23,000,000
$22,000,000
$21,000,000
$20,000,000
Initial Inflation Rates for Forecast:
$19,000,000
Revenue @ 2.40%
Expenditures @ 3.00%
$18,000,000
Accumulated Deficit 2015 –2019 = <$1,880,000>
$17,000,000
'14 Pre Y/E2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
RevenueExpenditures
8
General Fund
Un-Assigned Fund Balance (“Reserves”)
$6,000,00035.00%
What may happen if we “do nothing” regarding revenue &
expenditures for 2015 -2019
30.00%
$5,000,000
25% Target
25.00%
$4,000,000
20.00%
$3,000,000
15.00%
$2,000,000
10.00%
$1,000,000
5.00%
$00.00%
2004200520062007200820092010201120122013201420152016201720182019
Est.Est.Est.Est.Est
Fund Balance Amt. (Left Axis)% of Gen. Fund Expenditures (Right Axis)
9
General Fund
Revenue History
200420052006200720082009201020112012'13 Pre. Y/E
General Fund Revenue
14,539,45714,977,24115,536,20816,757,92517,260,34817,106,99517,919,51418,625,85318,025,36618,884,826
Change from Prior Yr.-$437,784558,9671,221,717502,423(153,353)812,519706,339(600,487)859,460
Change from Prior Yr.-%3.01%3.73%7.86%3.00%-0.89%4.75%3.94%-3.22%4.77%
$20,000,000
Compound Growth Rate
2004–2014 Budget = 102.54% w/o
$19,000,000
Property Tax from Streets
$18,000,000
$17,000,000
$16,000,000
$15,000,000
$14,000,000
$13,000,000
$12,000,000
200420052006200720082009201020112012'13 Pre. Y/E
General Fund Revenue
10
General Fund
Revenue Forecast
2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Revenue Forecast
19,163,80019,622,00020,095,00020,584,00021,089,00021,612,000
Chg. from Prior Yr.-$103,990458,200473,000489,000505,000523,000
Chg. from Prior Yr.-%0.55%2.39%2.41%2.43%2.45%2.48%
$24,000,000
$22,000,000
$20,000,000
$18,000,000
$16,000,000
$14,000,000
$12,000,000
2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Revenue Forecast
11
General Fund
Revenue Sources & Percentage
20042005200620072008
Revenue
Amount% of TotalAmount% of TotalAmount% of TotalAmount% of TotalAmount% of Total
Allocation from Utilities2,611,13717.96%2,654,45517.72%2,750,77217.71%2,515,31215.01%2,588,56715.00%
Property Tax2,834,51419.50%2,968,64819.82%2,958,25819.04%3,317,49819.80%3,397,81219.69%
Utility Tax3,684,40525.34%2,655,29117.73%2,884,60418.57%3,257,78019.44%3,353,32319.43%
Property Taxfor
Sales Tax2,633,33018.11%2,822,76018.85%3,254,67420.95%3,357,78020.04%3,209,82518.60%
2004 -2012
All Other Revenue2,776,07119.09%3,876,08725.88%3,687,90023.74%4,309,55525.72%4,710,82127.29%
excluded
property tax
Total Revenue14,539,45714,977,24115,536,20816,757,92517,260,348
diverted to the
Street Fund.
20092010201120122013 Prelim. Y/E
Average
diversion to
Revenue
Amount% of TotalAmount% of TotalAmount% of TotalAmount% of TotalAmount% of Total
Streets during
Allocation from Utilities2,776,14616.23%2,654,14814.81%2,685,05514.42%2,641,72514.66%2,927,02415.50%
the period of
Property Tax3,477,57520.33%3,553,58919.83%3,585,31419.25%3,630,67820.14%4,174,57822.11%
2004 -2012 =
$473,370/year.
Utility Tax3,506,12620.50%3,743,65720.89%3,800,13720.40%3,781,22920.98%3,966,20921.00%
Sales Tax2,763,42616.15%2,877,10016.06%2,876,60315.44%2,783,74315.44%2,872,27715.21%
All Other Revenue4,583,72226.79%5,091,02028.41%5,678,74430.49%5,187,99128.78%4,944,73826.18%
Total Revenue17,106,99517,919,51418,625,85318,025,36618,884,826
2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Revenue
Amount% of TotalAmount% of TotalAmount% of TotalAmount% of TotalAmount% of TotalAmount% of Total
Allocation from Utilities3,009,40015.70%3,039,00015.49%3,069,00015.27%3,100,00015.06%3,131,00014.85%3,162,00014.63%
Property Tax4,238,00022.11%4,323,00022.03%4,409,00021.94%4,497,00021.85%4,587,00021.75%4,679,00021.65%
Utility Tax4,426,10023.10%4,647,00023.68%4,879,00024.28%5,123,00024.89%5,379,00025.51%5,648,00026.13%
Sales Tax2,759,00014.40%2,787,00014.20%2,815,00014.01%2,843,00013.81%2,871,00013.61%2,900,00013.42%
All Other Revenue4,731,30024.69%4,826,00024.59%4,923,00024.50%5,021,00024.39%5,121,00024.28%5,223,00024.17%
Total Revenue19,163,80019,622,00020,095,00020,584,00021,089,00021,612,000
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General Fund
Property Tax
20042005200620072008200920102011
Property Tax
General Fund2,834,5142,968,6482,958,2583,317,4983,397,8123,477,5753,553,5893,585,314
Street Fund449,214463,480468,117472,796477,524482,299482,299482,299
Total Property Tax3,283,7283,432,1283,426,3753,790,2943,875,3363,959,8744,035,8884,067,613
Chg. from Prior Yr.-$23,325148,400(5,753)363,91985,04284,53876,01431,725
Chg. from Prior Yr.-%0.72%4.52%-0.17%10.62%2.24%2.18%1.92%0.79%
2012'13 Pre. Y/E2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Property Tax
General Fund3,630,6784,174,5784,238,0004,323,0004,409,0004,497,0004,587,0004,679,000
Street Fund482,2990000000
Total Property Tax4,112,9774,174,5784,238,0004,323,0004,409,0004,497,0004,587,0004,679,000
Chg. from Prior Yr.-$45,36461,60163,42285,00086,00088,00090,00092,000
Chg. from Prior Yr.-%1.12%1.50%1.52%2.01%1.99%2.00%2.00%2.01%
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General Fund
Property Tax
$5,000,000
Compound Growth Rate for 2004 –2014 Budget = 102.13%
including Property Tax from Streets
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
2004200520062007200820092010201120122013201420152016201720182019
Bud.Est.Est.Est.Est.Est.
General FundStreet Fund
14
General Fund
Assessed Value & Levy Rate
20042005200620072008200920102011
Assessed Value (A.V.)1,064,490,5021,148,440,5221,281,703,5181,595,493,4281,952,176,5001,994,259,5741,757,276,2931,735,945,788
Chg. from Prior Yr.-$14,462,41283,950,020133,262,996313,789,910356,683,07242,083,074(236,983,281)(21,330,505)
Chg. from Prior Yr.-%1.38%7.89%11.60%24.48%22.36%2.16%-11.88%-1.21%
Reg. Levy Rate/$1,000 A.V.
$3.1365$3.0552$2.8051$2.3875$1.9985$2.0129$2.9183$2.3561
20122013 Actual2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Assessed Value (A.V.)1,595,868,9741,519,228,1371,451,933,4711,466,453,0001,484,784,0001,507,056,0001,533,429,0001,564,098,000
Chg. from Prior Yr.-$(140,076,814)(76,640,837)(67,294,666)14,519,52918,331,00022,272,00026,373,00030,669,000
Chg. from Prior Yr.-%-8.07%-4.80%-4.43%1.00%1.25%1.50%1.75%2.00%
Reg. Levy Rate/$1,000 A.V.
$2.5752$2.7815$2.9537$2.9537$2.9537$2.9537$2.9537$2.9537
$2,500,000,000$3.50
$3.00
$2,000,000,000
$2.50
$1,500,000,000
$2.00
$1.50
$1,000,000,000
$1.00
$500,000,000
$0.50
$0$0.00
2004200520062007200820092010201120122013201420152016201720182019
Amend.BudgetEst.Est.Est.Est.Est.
Assessed Value (A.V.)Reg. Levy Rate/$1,000 A.V.
15
General Fund
Allocation from Utilities
20042005200620072008200920102011
Allocation from Utilities2,611,1372,654,4552,750,7722,515,3122,588,5672,776,1462,654,1482,685,055
Chg. from Prior Yr.-$334,91643,31896,317(235,460)73,255187,579(121,998)30,907
Chg. from Prior Yr.-%14.71%1.66%3.63%-8.56%2.91%7.25%-4.39%1.16%
2012'13 Pre. Y/E2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Allocation from Utilities2,641,7252,927,0243,009,4003,039,0003,069,0003,100,0003,131,0003,162,000
Chg. from Prior Yr.-$(43,330)285,29982,37629,60030,00031,00031,00031,000
Chg. from Prior Yr.-%-1.61%10.80%2.81%0.98%0.99%1.01%1.00%0.99%
$3,500,000
Compound Growth Rate 2004 –2014
Budget = 1.43%
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Amend.Budget
Allocation from Utilities
16
General Fund
Utility Excise Tax
20042005200620072008200920102011
Utility Tax - Combined2,684,4052,655,2912,884,6043,257,7803,353,3233,506,1263,743,6573,800,137
Chg. from Prior Yr.-$264,017(29,114)229,313373,17695,543152,803237,53156,480
Chg. from Prior Yr.-%10.91%-1.08%8.64%12.94%2.93%4.56%6.77%1.51%
20122013 Pre. Y/E2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Utility Tax - Combined3,781,2293,966,2094,426,1004,647,0004,879,0005,123,0005,379,0005,648,000
Chg. from Prior Yr.-$(18,908)184,980459,891220,900232,000244,000256,000269,000
Chg. from Prior Yr.-%-0.50%4.89%11.60%4.99%4.99%5.00%5.00%5.00%
$6,000,000
Compound Growth Rate 2004 –2014
$5,000,000
Budget = 5.13%
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Amend.Budget
Utility Tax - Combined
17
General Fund
Sales Tax
20042005200620072008200920102011
Sales Tax
Regular Sales Tax2,633,3302,822,7603,254,6743,336,4763,181,4502,736,3672,779,4352,832,116
EUGA Sales Tax00021,30428,37527,05997,66544,487
Total Sales Tax2,633,3302,822,7603,254,6743,357,7803,209,8252,763,4262,877,1002,876,603
Chg. from Prior Yr.-$212,942189,430431,914103,106(147,955)(446,399)113,674(497)
Chg. from Prior Yr.-%-100.00%7.19%15.30%3.17%-4.41%-13.91%4.11%-0.02%
20122013 Pre. Y/E2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Sales Tax
Regular Sales Tax2,708,6662,763,5732,679,0002,706,0002,733,0002,760,0002,787,0002,815,000
EUGA Sales Tax75,077108,70480,00081,00082,00083,00084,00085,000
Total Sales Tax2,783,7432,872,2772,759,0002,787,0002,815,0002,843,0002,871,0002,900,000
Chg. from Prior Yr.-$(92,860)88,534(113,277)28,00028,00028,00028,00029,000
Chg. from Prior Yr.-%-3.23%3.18%-3.94%1.01%1.00%0.99%0.98%1.01%
$3,600,000
$3,400,000
Compound Growth Rate 2004 –2014 Budget = 0.47%
$3,200,000
$3,000,000
$2,800,000
$2,600,000
$2,400,000
$2,200,000
$2,000,000
2004200520062007200820092010201120122013 Pre.20142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Y/EBudget
Regular Sales Tax EUGA Sales Tax
18
General Fund
Investment Interest Earnings
YearInvestment InterestLocal Government Investment Pool -- State
Interest$ Change% ChangeYearJanAprJulOct
fromfrom
EarningsPrior YearPrior Year
2002200,847n/an/a20022.07%1.88%1.79%1.73%
2003161,477(39,370)-19.60%20031.31%1.24%1.09%1.07%
2004113,021(48,456)-30.01%20041.07%1.02%1.15%1.71%
2005199,04686,02576.11%20052.22%2.77%3.21%3.76%
2006302,399103,35351.92%20064.23%4.66%5.16%5.19%
2007453,928151,52950.11%20075.21%5.23%5.21%4.91%
2008433,642(20,286)-4.47%20084.36%2.70%2.28%2.47%
2009123,431(310,211)-71.54%20091.27%0.89%0.62%0.41%
2010134,34610,9158.84%20100.28%0.24%0.27%0.25%
2011179,37445,02833.52%20110.23%0.17%0.15%0.11%
201274,083(105,291)-58.70%20120.12%0.15%0.17%0.17%
2013 Amended70,000(4,083)-5.51%20130.17%0.17%0.09%0.09%
2013 Prelim. Y/E91,77517,69225.27%20140.11%
2014 Budget70,000(21,775)-23.73%
19
General Fund
All Other Revenues
20042005200620072008200920102011
All Other Revenue2,776,0713,876,0873,687,9004,309,5554,710,8214,583,7225,091,0205,678,744
Chg. from Prior Yr.-$355,6831,100,016(188,187)621,655401,266(127,099)507,298587,724
Chg. from Prior Yr.-%14.70%39.62%-4.86%16.86%9.31%-2.70%11.07%11.54%
20122013 Pre. Y/E2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
All Other Revenue5,187,9914,944,7384,731,3004,826,0004,923,0005,021,0005,121,0005,223,000
Chg. from Prior Yr.-$(490,753)(243,253)(213,438)94,70097,00098,000100,000102,000
Chg. from Prior Yr.-%-8.64%-4.69%-4.32%2.00%2.01%1.99%1.99%1.99%
$6,000,000
Compound Growth Rate 2004 –
2014 Budget = 2.28%
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Amend.Budget
All Other Revenue
20
General Fund
Expenditure History
200420052006200720082009201020112012'13 Pre. Y/E
Gen. Fund Expenditures
14,939,85815,859,83916,551,07916,530,92518,960,34817,660,28117,278,69518,685,38019,126,83318,332,439
Change from Prior Yr.-$1,591,655919,981691,240(20,154)2,429,423(1,300,067)(381,586)1,406,685441,453(794,394)
Change from Prior Yr.-%6.16%4.36%-0.12%14.70%-6.86%-2.16%8.14%2.36%-4.15%
$20,000,000
Compound Growth Rate 2004 –2014 Budget
= 2.26% w/o Gen. Fund Subsidy to Streets in
$19,000,000
lieu of Property Tax for 2013 + 2014
$18,000,000
$17,000,000
$16,000,000
$15,000,000
$14,000,000
$13,000,000
$12,000,000
200420052006200720082009201020112012'13 Pre. Y/E
Gen. Fund Expenditures
21
General Fund
Expenditure Forecast
2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Expenditure Forecast
19,163,80019,740,00020,337,00020,954,00021,594,00022,257,000
Chg. from Prior Yr.-$831,361576,200597,000617,000640,000663,000
Chg. from Prior Yr.-%4.53%3.01%3.02%3.03%3.05%3.07%
$24,000,000
$22,000,000
$20,000,000
$18,000,000
$16,000,000
$14,000,000
$12,000,000
2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Expenditure Forecast
22
General Fund
Salaries & Wages
20042005200620072008200920102011
Salaries & Wages7,490,5887,555,1367,540,6538,375,0238,570,6248,885,6758,987,3829,225,206
Chg. from Prior Yr.-$5,214,36764,548(14,483)834,370195,601315,051101,707237,824
Chg. from Prior Yr.-%229.08%0.86%-0.19%11.06%2.34%3.68%1.14%2.65%
2012'13 Pre. Y/E2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Salaries & Wages9,231,0429,140,9789,249,3009,434,0009,623,0009,815,00010,011,00010,211,000
Chg. from Prior Yr.-$5,835(90,064)108,322184,700189,000192,000196,000200,000
Chg. from Prior Yr.-%0.06%-0.98%1.19%2.00%2.00%2.00%2.00%2.00%
$12,000,000
Compound Growth Rate 2004 –2014
Budget = 2.13%
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Amend.Budget
Salaries & Wages
23
General Fund
Employee Benefits
20042005200620072008200920102011
Employee Benefits2,342,0272,277,4072,351,4562,804,3392,976,6623,059,2203,144,9343,514,732
Chg. from Prior Yr.-$65,806(64,621)74,050452,883172,32282,55985,714369,798
Chg. from Prior Yr.-%2.89%-2.76%3.25%19.26%6.14%2.77%2.80%11.76%
2012'13 Pre. Y/E2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Employee Benefits3,390,1493,687,0073,744,7503,951,0004,168,0004,397,0004,639,0004,894,000
Chg. from Prior Yr.-$(124,583)296,85857,743206,250217,000229,000242,000255,000
Chg. from Prior Yr.-%-3.54%8.76%1.57%5.51%5.49%5.49%5.50%5.50%
$6,000,000
Compound Growth Rate 2004 –2014
$5,000,000
Budget = 4.80%
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Amend.Budget
Employee Benefits
24
General Fund
All Other Expenses
20042005200620072008200920102011
All Other Expenses5,107,2436,027,2966,658,9705,351,5637,413,0625,715,3865,146,3795,945,442
Chg. from Prior Yr.-$2,831,022920,053631,674(1,307,407)2,061,499(1,697,676)(569,007)799,063
Chg. from Prior Yr.-%124.37%18.01%10.48%-19.63%38.52%-22.90%-9.96%15.53%
2012'13 Pre. Y/E2014 Bud.2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
All Other Expenses6,505,6425,504,4546,169,7506,355,0006,546,0006,742,0006,944,0007,152,000
Chg. from Prior Yr.-$560,200(1,001,188)665,296185,250191,000196,000202,000208,000
Chg. from Prior Yr.-%9.42%-15.39%12.09%3.00%3.01%2.99%3.00%3.00%
$9,000,000
Compound Growth Rate 2004 –2014 Budget = 1.91%
$8,000,000
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.
Amend.Budget
All Other Expenses
25
Economic Development Fund
We have been living off the Graving Yard settlement
•
funding but that is nearly gone –only $618,971 projected
for 2014 ending fund balance
No identified source of on-going revenue to re-build the
•
fund or to fund future programs/projects
Currently classified as a “special revenue fund”
•
Without an external source of revenue, will need to be reclassified
•
as part of the General Fund starting in 2015
26
Economic Development Fund
20042005200620072008200920102011
Econ. Development Fund
Beginning Fund Balance23,87245,26964,934269,5418,092,9296,396,0026,551,1065,692,864
Revenues + Interest304,488157,245389,3768,000,142587,927427,944231,286229,116
Expenditures283,091137,580184,769176,7542,284,854272,8401,089,5291,168,750
Ending Fund Balance45,26964,934269,5418,092,9296,396,0026,551,1065,692,8644,753,230
Chg. from Prior Yr.-$21,39719,665204,6067,823,388(1,696,927)155,104(858,243)(939,634)
Chg. from Prior Yr.-%89.63%43.44%315.10%2902.49%-20.97%2.43%-13.10%-16.51%
20122013 Pre. Y/E2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Econ. Development Fund
Beginning Fund Balance4,753,2302,460,052376,971618,971631,546636,750634,134623,226
Revenues + Interest422,505331,944420,500200,000202,000204,020206,060208,121
Expenditures2,715,6822,415,025178,500187,425196,796206,636216,968227,816
Ending Fund Balance2,460,052376,971618,971631,546636,750634,134623,226603,531
Chg. from Prior Yr.-$(2,293,178)(2,083,081)242,00012,5755,204(2,616)(10,908)(19,695)
Chg. from Prior Yr.-%-48.24%-84.68%64.20%2.03%0.82%-0.41%-1.72%-3.16%
$9,000,000
$8,000,000
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Pre. Y/EBudget
Ending Fund Balance
27
Street Fund
Heavily dependent on funding support from the General Fund –
•
45.7% of 2014 budget is from the General Fund
2013 LRFP discussions indicated support for ramping down General Fund
•
support to save $$ for General Fund needs in future
Motor Vehicle Fuel Tax (MVFT) only dedicated funding source for
•
streets –2014 @ $390,000 or 21.1% of budget
Need to develop plan for street repair/renovation:
•
Schedule / timeline for repairs
•
How to fund?
•
Transportation Benefit District
•
Is it a potential solution?
•
If wanted, how should it be established?
•
By Council vote –“$20 car tab”
•
Citizen vote –potential for higher car tab rate or through additional sales tax
•
28
Street Fund
Revenues History
20042005200620072008200920102011
Street Fund
Gen. Fund Subsidy / Prop. Tax699,214763,480788,115832,796917,524681,099662,299648,299
Motor Vehicle Fuel Tax259,183396,108434,257459,652435,257417,035417,167462,901
Other Revenue417,874353,245437,283406,212176,106304,521643,750576,222
Total Revenue1,376,2711,512,8331,659,6551,698,6601,528,8871,402,6551,723,2161,687,422
Chg. from Prior Yr.-$85,742136,562146,82239,005(169,773)(126,232)320,561(35,794)
Chg. from Prior Yr.-%6.64%9.92%9.71%2.35%-9.99%-8.26%22.85%-2.08%
20122013 Pre. Y/E2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Street Fund
Gen. Fund Subsidy / Prop. Tax772,299922,000846,600855,066863,617872,253880,975889,785
Motor Vehicle Fuel Tax474,050394,852390,000378,300365,816353,013339,598326,014
Other Revenue515,960578,458615,000621,150627,362633,635639,971646,371
Total Revenue1,762,3091,895,3101,851,6001,854,5161,856,7941,858,9001,860,5451,862,170
Chg. from Prior Yr.-$74,887133,001(43,710)2,9162,2782,1061,6441,626
Chg. from Prior Yr.-%4.44%7.55%-2.31%0.16%0.12%0.11%0.09%0.09%
Compound Growth Rate 2004 = 2014
$2,000,000
Budget = 3.00%
$1,900,000
$1,800,000
$1,700,000
$1,600,000
$1,500,000
$1,400,000
$1,300,000
$1,200,000
$1,100,000
$1,000,000
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Pre. Y/EBudget
Total Revenue
29
Real Estate Excise Tax I & II
20042005200620072008200920102011
REET I + REET II
Beginning Fund Balance728,316984,8751,230,341796,628776,377885,497596,357379,625
Revenues + Interest519,214586,531755,763569,710267,309264,349239,021212,290
Expenditures262,655341,0651,189,476589,961158,189553,489455,753400,136
Ending Fund Balance984,8751,230,341796,628776,377885,497596,357379,625191,779
Chg. from Prior Yr.-$256,559245,466(433,713)(20,251)109,120(289,140)(216,732)(187,846)
Chg. from Prior Yr.-%35.23%24.92%-35.25%-2.54%14.06%-32.65%-36.34%-49.48%
20122013 Pre. Y/E2014 Budget2015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
REET I + REET II
Beginning Fund Balance191,779220,144196,074262,174325,139384,875442,820498,889
Revenues + Interest176,825251,191170,600170,600170,600172,135173,685175,248
Expenditures148,460275,261104,500107,635110,864114,190117,616121,144
Ending Fund Balance220,144196,074262,174325,139384,875442,820498,889552,993
Chg. from Prior Yr.-$28,365(24,070)66,10062,96559,73657,94556,06954,104
Chg. from Prior Yr.-%14.79%-10.93%33.71%24.02%18.37%15.06%12.66%10.84%
$1,000,000
$900,000
$800,000
$700,000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$0
200420052006200720082009201020112012201320142015 Est.2016 Est.2017 Est.2018 Est.2019 Est.
Pre. Y/EBudget
Ending Fund Balance
30
Total Debt Service
Principal + Interest Payments
$9,000,000
Top 3 layers are debt
associated with environmental
$8,000,000
requirements:
CSO Project Phase I
$7,000,000
CSO Project Phase II
Landfill Bluff
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
20012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026202720282029203020312032203320342035203620372038
Voter-Approved DebtCouncil-Approved Bonds
Electric Revenue BondsWater + Wastewater Revenue Bonds
Water PWTF LoansWastewater Non-CSO PWTF + SRF Loans
REET-1 + REET-2 PWTF LoansWaste Connections Contract
CSO -- Wastewater PWTF + SRF LoansCSO Phase II PWTF + SRF Loans - Est.
Landfill Bluff Revenue Bond - Est.
31
LONG-RANGE POLICIES:
~CONSENSUS CHANGES AGREED TO +
~ POLICIES AWAITING FURTHER DIRECTION
City of Port Angeles
Long-Range Financial Plan
32
Consensus Decisions on Financial Policy
2013LRFP Planning Efforts
The Council should consider the overall impact on the
1.
community and its ability to pay against the need to enact
any tax, utility rate or fee/charge increase. (A.01)
The Council should not use reserves/fund balance as a
2.
funding source for on-going operations except in an
emergency, short-term basis. (A.02 + B.04)
Council should consider implementing a “phase-out” of
3.
General Fund subsidy for the Street Fund and Medic 1 Fund.
(A.06)
Phase-out should be over a period of not less than three (3) years
•
nor more than five (5) years.
Replacement funding for the Street Fund will need to be
•
coordinated with the creation of a Transportation District.
Replacement funding for Medic 1 subsidy from the General Fund
•
shall come from an upward adjustment to applicable utility rates.
33
Consensus Decisions on Financial Policy
2013 LRFP Planning Efforts
Council should consider selling of the Niichel property
4.
and other unused City properties to allow the City to
have the resources to meet the debt service obligations
of the 2005 Limited Term General Obligation Bond and
its $1,000,000 balloon payment in 2021. (A.14)
Council should consider, prior to the issuance of any
5.
general government or utility debt, the overall impact of
the City’s ability to repay the debt obligation from either
taxes or utility rates. (B.01)
34
Consensus Decisions on Financial Policy
2013 LRFP Planning Efforts
Council should consider a policy that significantly
6.
restricts the use of highly volatile funding sources such
as the Real Estate Excise Tax (REET-1 or REET-2) for
debt service or other long-term commitments.
Preference should be given for one-time capital
expense or short-term funding commitments for a
capital project. (B.02)
Council should consider amending its current policy
7.
regarding the General Fund Unassigned Fund Balance
(“reserves”) from the current minimum level of 10% of
current budget expenditures to 25%. (B.03)
35
Consensus Decisions on Financial Policy
2013 LRFP Planning Efforts
Council should consider a policy requirement that
8.
prohibits the use of one-time revenues or other similar
sources of funding for recurring operating expenses in
any fund. (B.04)
Council should consider a policy requirement that all
9.
employees should contribute to their health insurance
coverage for both the individual employee coverage as
well as any family coverage that may be provided (B.07)
36
Consensus Decisions on Financial Policy
2013 LRFP Planning Efforts
Council should consider development of a policy that
10.
requires an analysis of all public works projects prior to
bidding to determine the potential for segmenting the
project into economically feasible segments or phases
that can be targeted to encourage local contractors to
bid on projects that may be more in line with their
economic resources and capabilities. (B.09)
37
Consensus Decisions on Financial Policy
2013 LRFP Planning Efforts
Council should consider implementing the following
11.
recommendations regarding the funding of capital
projects: (B.10)
First priority for capital funding should be given to those projects designed to
•
preserve and maintain existing infrastructure.
Council should give consideration to rank ordering the following to give
•
priority direction on capital projects:
Legal & statutory requirements or mandates provided realistic and affordable
sources of funding are available to the City.
Continuation of multi-year projects provided realistic and affordable sources of
funding are available to the City.
Capital funding should be given to those projects that leverage City funding with
grants from state or federal agencies.
Capital funding should be given to public-private partnership projects whereby the
City can leverage its contribution with private dollars to enable a more economically
diverse project with the primary risk for the long-term financing is transferred to a
private partner.
38
Consensus Decisions on Financial Policy
2013 LRFP Planning Efforts
Council should consider implementing the following
12.
policy recommendations for debt financing of projects:
(B.11)
If long-term debt financing is proposed, a financial analysis shall
•
be required prior to any approval of the project that analyzes the
long-term sustainability of funding from City resources as well as
the overall impact to the City’s total debt obligation.
Any maintenance and operation (M&O) costs associated with the
•
completed project must be identifies along with the proposed
source of funding for the M&O costs prior to approval of the
project.
•Issue: Maintenance & Operation (M&O) funding for new capital projects. For
example, the Waterfront Esplanade was constructed and put into service
without any additional staffing for funding for Parks & Recreation to maintain
39
Proposed Policies Awaiting
Further Direction
Recommendation on the 1.0% increase for property tax (A.03)
1.
Option: Develop future budgets based on levying the 1.0% increase
a.
but with footnotes detailing potential impact if not approved
Recommendation on use of “banked” property tax capacity (A.04)
2.
Option: Not to be used in normal budget development. May be
a.
core
considered only if a reduction in service level to services is
proposed
Recommendation to maintain utility excise tax rates at same level
3.
through 2017 (A.05)
Fees and charges for building permits should include total cost
4.
recovery of direct and indirect costs (A.07)
Option: Consider potential for reduction or credits for new jobs
a.
created and/or sales taxes derived from construction project
40
Proposed Policies Awaiting
Further Direction
Fees and charges for parks and recreation should be based
5.
on a cost recovery hierarchy (A.07)
Utility rates should be designed to reflect the underlying
6.
nature of costs for each respective utility (A.09)
Option: Establish rates based on underlying nature of costs but
a.
develop specific criteria to allow for limited rate class adjustments
designed to achieve specific goals
Council should consider the formation of a sales tax or car-
7.
tab greater than $20 funding source for voter-approved
Transportation Benefit District for streets (A.10)
Council should consider identification and implementation of
8.
a dedicated funding source for the Economic Development
Fund (A.11)
41
Proposed Policies Awaiting
Further Direction
Council should consider giving preference to more frequent
9.
small, incremental increases to fees, charges, utility rates
and taxes rather than larger, less frequent increases (A.12)
Option: Establish policy direction for all Cost of Service Analysis to give
a.
preference for “phased-in” approach for any future rate increases
including the potential delay or slow-down on planned capital
expenditures.
Council should consider options to increase the City’s tax
10.
base including analyzing the cost of service impact of
potential annexations before the City will initiate any
annexation action. (A.13)
Option: Council should conduct a cost of Service Analysis (COSA) to
a.
determine the costs of providing service to a proposed area compared to
the potential revenue that may be collected from an are under
consideration for annexation.
42
Proposed Policies Awaiting
Further Direction
Council should consider a policy requirement that commits
11.
the City to paying fair and equitable salaries and wages to its
employees based upon both internal comparability and
external market analysis (B.06)
Option: Establish policy direction that the City every five (5) years will perform
a.
a salary and benefit survey that will take into account both internal
comparability and external market analysis for discussion and review by
Council as part of the regular budget development process.
Option: Council should charge a sub-committee such as the Sustainability
b.
Committee with reviewing the current salary & benefit plan for City employees
and to make recommendations to Council prior to the 2015 budget process.
Council should consider implementation of a policy that
12.
requires all payments made by the City for payroll or
accounts payable be done through electronic funds transfer
(B.08)
43
SETTING PROGRAM &
SERVICE DELIVERY
PRIORITIES
City of Port Angeles
Long-Range Financial Plan
44
What Do We Mean by a Program &
Services Plan
A Program & Services Plan is most easily defined as a
•
Council-adopted methodology that establishes:
What programs &services the Council wants delivered to its residents;
Who delivers the programs & services (internally provided or
contracted-out);
The amount and quality of programs & services that are delivered;
How the City pays for the programs & services to be delivered; and
How does the City measure the outcome or results achieved from the
programs & services delivered
The Program & Services Plan will:
•
Establish priorities for programs & services provided by the City; and
Ration limited resources to the priority programs & services established
by the Council
45
First Step in Developing a Program &
Services Plan
Establish a Vision Statement for the City
•
XXXX
“Snapshot” of the City of Port Angeles in
•
(fill in the year desired)
desired character and characteristics
Summarizes the of our
•
community
Provides the ultimate goals for our community planning and
•
development efforts
directionmere wish
Intended to set a instead of being a .
•
Rather than describing the features of Port Angeles as we think
•
they are likely to be, it expresses what we like our community to
become and believe we can achieve.
46
Second Step in Developing a Program &
Services Plan
Establish a Mission Statement for the City to guide the
•
development of priorities used to create the Program &
Services Plan
What is the City’s purpose?
Clear, concise statement --“30 second elevator speech”
Example from the City of Lacey, WA:
Our mission is to enrich the quality of life in Lacey for all our citizens . . . to
build an attractive, inviting, and secure community. We pledge to work in
partnership with our residents to foster community pride, to develop a
vibrant, diversified economy, to plan for the future, and to preserve and
enhance the natural beauty of our environment.
Recommendation: Establish a sub-committee of 2-3
•
Councilmembers together the City Manager (and others as
appropriate) to develop a Vision and Mission statement for
consideration by the Council
47
City of Port Angeles
Statement of Values
We the employees of the City of Port Angeles share a
•
dedication and commitment to providing QUALITY
CUSTOMER SERVICE with HONESTY, INTEGRITY, and
FLEXIBILITY.
Working as a team, we take PRIDE in providing EFFICIENT
•
and EFFECTIVE services for which we are RESPONSIBLE
and FISCALLY ACCOUNTABLE.
We value a POSITIVE ATTITUDE, TRUST INITIATIVE and
•
COMPASSION with a high standard of PROFESSIONALISM
and OPEN COMMUNICATION. We respect DIVERSITY and
foster a SAFE environment.
In PARTNERSHIP with the community, we are STEWARDS of
•
our unique environment and QUALITY OF LIFE.
48
Defining Priorities
Questions Needing to be Answered
Do we want to define “CORE” programs or services vs. “ANCILLARY” programs
•
or services?
How detailed or “into the weeds” do we want to go with priority setting?
•
Do we fully fund priority #1 before we fund priority #2?
•
Do we keep programs or services because we can “make money” or “not lose
•
money” on providing a particular program or service?
How do we balance QUALITY of service vs. QUANTITY of service?
•
Is there a target segment of the community we want/need to receive enhanced
•
programs or services?
Will we eliminate a program or service if there is no other readily available
•
provider?
How should we balance program and service needs vs. capital / infrastructure
•
needs?
49
Key Financial Principals
HOW: WHO:
MAKE TRADE-OFFS:INVEST IN EMPLOYEES:
Do not initiate major new services without The City will invest in employees and provide resources to
either (a) ensuring there is revenue to pay for themaximize their productivity.
service, or (b) making trade-offs of existing services.
DO IT WELL:
If the City cannot deliver a service well, the service will not
be provided at all.
CONTRACT IN / CONTRACT OUT:
Consider alternative service delivery to maximize
efficiency and effectiveness.
PURSUE INNOVATIVE APPROACHES TO SERVICE
DELIVERY
Continue to implement operational efficiencies and cost
saving measures. Pursue partnerships and
cost sharing strategies with others.
WHAT:$ $
FOCUS PROGRAMS ON PORT ANGELES RESIDENTS & USE UNEXPECTED ONE-TIME REVENUES FOR
BUSINESSES: ONE-TIME COSTS OR RESERVES:
Give priority to maintaining existing infrastructure.One-time revenues will be strategically to
fund prioritized capital projects.
MAINTAIN CAPACITY TO RESPOND TO EMERGINGADDRESS UNFUNDED LIABILITIES
COMMUNITY NEEDS
PURSUE ENTREPRENEURIAL INITIATIVESSELECTIVELY RECOVER COSTS:
On a selective basis, have those who use a service pay the
full cost.
RECOGNIZE THE CONNECTION BETWEEN THE
OPERATING BUDGET AND THE CAPITAL BUDGET
50
Settings Fees & Rates –
Cost Recovery Pyramid
MOSTLY INDIVIDUAL Benefit
Enterprise / Profit Center
HIGHLY INDIVIDUAL Benefit
Full cost recovery / No subsidy
INDIVIDUAL / Community Benefit
Substantial cost recovery / Limited subsidy
COMMUNITY / Individual Benefit
Low cost recovery / Some subsidy
COMMUNITY Benefit
No cost recovery / Full subsidy
City Infrastructure
Asset Life Cycle Model
Re-Invest in Asset
Asset
•Return on Investment
•Adjustment for value, product
(revenue, customer, value, productivity
and efficiencies
and efficiency)
Life of Asset
Asset Decline
(asset deterioration, product decline, lack of revenue)
Re
-
Analysis
Investment
Point of No Return
(
no return on investment, divest in asset)
Total Asset/Product Deterioration
52
Proposed Future Meeting Schedule
Tuesday, March 25 th @ 5:00 PM –7:00 PM
•
Review Proposed Mission & Vision Statements
•
Finalize Proposed Policy Recommendations
•
Tuesday, April 22 nd @ 5:00 PM –7:00 PM
•
Utility Rate Setting Review
•
Tuesday, April 29 th @ 4:30 PM –7:00 PM –(Special Meeting)
•
Finalize Mission & Vision Statements
•
Review Priority Rankings
•
Review Preliminary Resource Allocation/Rationing
•
Thursday, May 22 nd @ 2:30 PM –5:00 PM –(Special Meeting
)
•
Final Review & Discussion on Priority Rankings
•
Further Review & Discussion on Resource Allocation/Rationing
•
Tuesday, June 24 th @ 5:00 PM –7:00 PM
•
Review “final” document for changes
•
Tuesday, July 1 st @ 6:30 PM (Regular Council Meeting)
•
st
1Public Hearing on Long-Range Financial Plan
•
Tuesday, July 15 @ 6:30PM
•
nd
2Public Hearing
•
Adoption of Long-Range Financial Plan via Resolution
•
53
Approaching the End
Questions, Comments & Requests from Council
•
Adjournment
•