HomeMy WebLinkAbout11-13-2002spSPECIAL CITY COUNCIL MEETING
2003 BUDGET WORKSHOP
November 13, 2002
Minutes
I. INTRODUCTION
The November 13, 2002 special meeting of the Auburn City Council for the
purpose of conducting the 2003 Budget workshop was called to order at 4:03 PM
in the Council Work Area located on the first floor of Auburn City Hall, 25 West
Main Street, Auburn, WA. Mayor Peter B. Lewis and the following
Councilmembers were present: Rich Wagner, Jeanne Barber, Fred Poe, Sue
Singer, Stacey Brothers, and Gene Cerino. Councilmember Trish Borden arrived
at 4:08 PM.
Staff members present included: Finance Director Shelley Coleman, Assistant
Finance Director Lee Hall, Human Resources Director Brenda Heineman, Acting
Public Works DirectodCity Engineer Dennis Dowdy, Fire Chief Bob Johnson,
Parks and Recreation Director Daryl Faber, Police Chief Jim Kelly, Planning and
Community Development Director Paul Krauss, City Attorney Daniel B. Heid, and
City Clerk Danielle Daskam.
II. GENERAL OVERVIEW
Finance Director Coleman presented the 2003 Budget using overhead slides and
the 2003 Preliminary Budget document. She noted that the mission and vision
statements are not included in the Preliminary Budget but will be included in the
Final Budget document.
Budget Process
Finance Director Coleman reviewed the budget process contained on
page 23 of the Preliminary Budget. The process starts with the
development of Council goals, departments then develop next year's work
plan, preliminary department budgets are submitted to the Mayor, revenue
projections are prepared and the first public hearing is held in September.
The Council Committees review the preliminary budgets, the preliminary
budget is filed in October, the property tax levy is set and the second
public hearing is held on the preliminary budget. A Council workshop is
then held, the final public hearing is held in December, and the budget is
adopted before year end.
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November 13, 2002
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Budget Policy
Ms. Coleman briefly reviewed the budget policy beginning on page 28 of
the budget document. The budget policy is shaped by the needs of
community; the past, present and projected future fiscal environment; the
established financial management policies, and the Council goals.
Budget Summary
Assistant Finance Director Hall directed the Council through the budget
summary. All fund revenues (without fund balances) are $80,147,200; all
fund expenditures are $92,048,163. All fund revenues represent a 10%
decrease from 2002. All fund expenditures represent a 5.7% decrease
from 2002. The General Fund revenues are projected at $36,789,900; a
1.7% decrease from 2002. General Fund expenditures are $45,237,205;
a 4% increase from 2002.
Departments were allowed a 2.5% increase in discretionary expenditures.
Salaries and benefits increased approximately 8.4%.
Ms. Hall noted that intergovernmental and miscellaneous revenues are
decreasing. She explained that the Mayor/Council budget increased due
to the addition of a secretary position, the movement of Auburn Update
costs from Planning to the Mayor's Office, and the addition of an
advertising budget. The Planning, Public Works, Solid Waste, and
Equipment Rental budgets are also affected by reorganization. The
Finance Department budget increased due to the addition of information
systems projects and costs transferred from other General Fund areas.
Councilmember Wagner suggested utilizing actual dollar figures rather
than percentages to show the changes.
Ms. Hall explained that Special Revenue decreased due to the completion
of major arterial street projects. Additionally, the Utility Funds decreased
due to completion of Public Works Trust Fund projects.
She concluded that the ending fund balance for 2003 for all funds will be
approximately $48 million.
Financial Plan
Ms. Coleman reviewed the Financial Plan beginning on page 49 of the
budget document. She highlighted the schedule contained on page 51 of
the budget, which is a summary of the City's financial structure. There are
28 funds and eight fund types. The Financial Plan includes an analysis of
revenue and expenditures.
City Council Special Meeting
November 13, 2002
The estimated property tax revenue for 2003 is comprised of a base of
$11,857,974, $118,580 from the levy increase, $337,505 from new
construction, $82,462 from annexations, and $110,926 in refunds for total
estimated property tax revenue of $12,507.447.
The levy rate is estimated at $2.95 on the assessed valuation of
$4,187,069,600.
Councilmember Borden asked staff to determine the percentage of the
assessed valuation that is Boeing property.
Ms. Coleman directed Council to the six year forecast beginning on page
71 of the budget document. She noted that the utility tax recently
approved by Council is not included in the preliminary budget figures.
The Financial Plan also includes debt capacity and obligations.
The Financial Plan section also analyzes the current and potential
legislative action and its cumulative effect. She presented a table of the
effect on the 2003 Budget and a cumulative effect over the period 1996 to
2003. Approximately $500,000 is revenue is lost in 2003 from the sales
tax exemption on research and development and manufacturing.
Approximately $506,100 in property tax revenue is lost in 2003 due to
Referendum 47. Approximately $784,800 is revenue is lost in 2003 due to
1-695, and approximately $111,100 is lost in 2003 due to 1-747.
Approximately $11 million in revenue is lost over the 1996-2003 period.
Baseline Budget
Ms. Hall presented the baseline budget. She noted there are no new
positions in the General Fund. Discretionary expenditures were limited to
a 2.5% increase. Departments reflected on their accomplishments and
established 2003 goals. The baseline budget also includes proprietary
working capital budgets.
Ms. Coleman reported that Human Resoumes settled six collective
bargaining agreements this year. The impact on salaries and wages for
2003 are: 3% for police commanders, 3% for commissioned police, 2.5%
for noncommissioned police, 4% for fire, 2.5% for outside teamsters, and
2.5% for court and custodian teamsters.
Councilmember Wagner questioned the impact of employee salary step
increase on the budget. Human Resoumes Director Heineman stated
step increases range from 2.5 to 3.2%, but not all employees receive a
step increase.
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November 13, 2002
Pag~ 4.
Councilmembers reviewed the Non-departmental General Fund
expenditures (Department 98). Ms. Hall outlined the expenditures:
$587,600 for retirement pay-offs; $200,000 for the executive department
for contingencies; $523,600 for LEOFF 1 benefits; $236,000 for public
safety building design; $25,000 for GASB 34 implementation; $251,000 for
Valley Comm debt service; $30,000 for the gateway program; $200,000
for the neighborhood plan; $840,000 for Endangered Species Act
compliance (this items will be reduced by half); $200,000 for the City Hall
courtyard repair, and $858,905 for transfers out. Ms. Hall explained that
the transfers out include: block grant match, library bond debt service, fire
apparatus replacement, and downtown revitalization.
The Council then reviewed the Capital Improvement Fund 328, 2003
expenditures. The fund includes $1,030,600 for fire pumper and ladder
engines, $330,000 for two aid cars, $702,000 for the second of three
installments for the parking garage, $410,000 for the City Hall and Parks
remodel, $60,000 for a sidewalk cleaner, $50,000 for City-paid
Transportation Impact fees, $24,000 towards the Small Business
Assistance Center, $200,000 in interest earnings to street preservation,
$350,000 in REET 2 funds for TIP street projects, and $300,000 in REET
2 funds for Veterans and West Beverly Parks improvements.
Councilmember Wagner inquired whether any funds have been set aside
for the 3rd Street Project settlement. Ms. Coleman explained that unused
funds from 2002 would be rolled over for that purpose.
Ms. Coleman reviewed the employee positions that have not been filled:
two positions in engineering ($143,000), two positions in planning
($103,000), one position in parks and recreation ($84,000), one position in
Fire ($60,000), and three police positions ($244,00). The three positions
cut from police include one of the two assistant chiefs and two positions
for the alternatives to incarceration program. The positions cut from
planning are a building inspector and a permit coordinator. The positions
not filled in engineering include a secretary and a project engineer. The
position not filled in parks and recreation had been approved in 2002 but
not filled. Mayor Lewis added that there is no plan to fill positions when
they become vacant unless it is a position that would put the City at risk if
not filled.
Ms. Coleman reviewed the General Fund department cuts from the
preliminary budget. Approximately $1.2 million needed to be cut from the
preliminary budget. Each director was asked to reduce his/her budget on
a pro-rata share basis to accomplish the overall budget reduction. The
result was a $1.5 million reduction in General Fund expenditures. The
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November 13, 2002
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budget cuts by department were outlined in the presentation. The
reductions will be reflected in the Final Budget.
Chief Kelly explained that the reduction in the police budget will be
accomplished through reducing the outside incarceration costs and
implementing an early release program.
In response to a question from Councilmember Brothers, Ms. Coleman
reported that the Downtown Revitalization Fund will have a balance of
$1.8 million in 2003.
Program Improvements
Ms. Hall outlined the program improvements included in the 2003 Budget.
Four new positions are included in the program improvements. The
accounting specialist in Finance will be paid from the Solid Waste Fund.
The Water Division Manager will be paid from the Water Fund. The
Hydraulic Modeler will be paid from the Water, Sewer and Storm Funds.
The Emergency Vehicle Mechanic will be paid from the Equipment Rental
Fund.
Capital Budget
Ms. Coleman reviewed the Capital Development portion of the budget.
She noted that the Water Fund does not have excess resources to service
additional debt. Ms. Hall outlined the capital/construction projects for
2003 as contained on page 231 of the budget document. By funding
source they are: $416,000 from the General Fund, $300,000 from the
Capital Improvement Fund, $170,000 from the Golf Course Fund,
$5,149,000 from the Arterial Street Fund, $1,411,000 from the Water
Fund, $652,000 from the Sewer Fund, and $1,843,000 from the Storm
Fund.
III. DISCUSSION
In response to a question from Councilmember Singer, Human Resources
Director Heineman reported that a 2.5% cost of living adjustment has
been included in the budget for non-affiliated employees.
Mayor Lewis commented that from this point forward, every position that is
not filled will have an effect on service.
Mayor Lewis and Council discussed the potential effects of Initiative 790
which changes the administration of the LEOFF 2 retirement program.
Mayor Lewis spoke regarding the increased population for Auburn and the
investment and development that will follow.
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November 13, 2002
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IV. ADJOURNMENT
There being no further discussion, the meeting adjourned at 5:43 PM.
DAY OF ~ , 2003.
Peter B. Lewis, Mayor ' askam, City Clerk