Budget Committee Meeting
May 3, 2003, 8:30am
Civic Center Council Chambers, 1175 East Main Street
CALL TO ORDER
Chairperson Marty Levine called the meeting to order at 8:30am.
Present: Marty Levine, Alan DeBoer, Jim Moore, John Morrison, Jacquie Christensen, Russ Silbiger, Dave Williams, Regina Stepahin, Alex Amarotico, Don Law, Chris Hearn, Kate Jackson and Cate Hartzell
Absent: Ray Olsen
Staff: Gino Grimaldi, Lee Tuneberg, Keith Woodley, Ken Mickelson, John McLaughlin, Dick Wanderscheid, Scott Fleuter, Mike Bianca and Tina Gray.
Others: Allen Douma, Jack Hardesty, Andy Dungan and Miles Murphy, Ashland Daily Tidings.
Jack Blackburn/805 Oak Street
Mr. Blackburn began by commenting on his views of reducing debt for the City of Ashland. He voiced concerns over AFN and the debt that it causes the City. He discussed the need of a resolution to the PERS problem and health care costs for personnel. He suggested that the City become realistic about economic conditions around the world and adjusts spending accordingly, by adjusting levies and by lowering the cost of living each year.
Andy Dungan/260 Meadow Drive
Mr. Dungan referred to a handout regarding the challenges of housing in Ashland and the importance of the Housing Specialist position. He suggested that council needs to make a priority that the city needs affordable housing. Discussion continued on the position, its longevity and funding. DeBoer questioned if it is to be a permanent position and mentioned his concern about positions created as temporary, the candidates should know that. He is also concerned about positions that are created by committees or council.
Hartzell mentioned information regarding a pilot project around real-estate transfer fees. If that passes, there would be some money set aside for the administration of it. Local districts would have say in how the money was spent.
Moore proposed a question on what the price range is for low cost housing. Moore suggested that the City needs more subsidizing of middle income people. The new housing specialist needs to work on partnerships with profits, non-profits, and government agencies.
Williams stated that this doesnít address the cost to taxpayers or the number of units or impact on Ashland on ever increasing densities.
Levine added there are 2 things to look at, the price of houses and affordability. The question arose on whether the housing specialist is going to spend anytime developing jobs so people can afford Ashland.
Hartzell questioned land use laws to accommodate growing densities. The Fire Marshal is doing inspections for free. The issue is about the loss of $80,000 and standing to lose CDBG 42%. Employers are facing problems with recruitment because of the lack of affordable housing. Levine questioned why council told AFN not to market in Silicon Valley to bring high tech companies to Ashland.
Moore inquired about successful housing programs in other cities. There was discussion about the Housing Specialist position and the need to have someone who really knows this area fill it.
APPROVAL OF MINUTES
Approval of minutes from previous budget meetings dated:
04/24/03 Budget Committee Meeting
Mike Gardiner, Dianna Riley, Jim Lewis
04/26/03 Departmental Presentations
Correct error discovered by Silbiger in Electric.
DeBoer/Jackson m/s to accept minutes as corrected.
Tuneberg presented unfinished business spoken to in memos. Suggested resuming the presentations first, then unfinished business. Everyone agreed.
AFN - continued 3-96
Electric Director Dick Wanderscheid answered questions on technology life, projected revenues, rates and debt service.
He is not concerned about technological change making AFN obsolete. They have a revenue problem not a cost problem.
Williams stated he has concerns about AFN borrowing more money, that it is not reflected in the numbers. Wanderscheid answered they are not contemplating any further borrowing that is not reflected in the numbers as they are. Williams expressed concerns about debt service that it reached a level of $700,000 just to pay interest on the loans. Wanderscheid responded that if the City hadnít lost the 13 customers due to economy, they would be on target
Levine clarified that they are not envisioning any future debt other than interfund loans.
Jackson commented that AFN and the growth is part of a larger picture, that efforts to grow would include data service, and the Internet side of AFN. She stated that the economy effects growth, and growth will take longer when the economy is struggling.
Williams voiced that he is concerned about the Budget Committeeís responsibility of not meeting revenue projections and the rising debt.
Silbiger inquired about the ramifications of dropping revenue down $400,000 per year. Tuneberg responded that the $400,000 was adjusted from internal revenues to internal borrowing from electric fund. Wanderscheid added the business plan assumes $7.5 million in internal debt this year.
Moore inquired about Telecommunication fund narrative is in error, the budget is wrong.
Levine questioned if it is possible to get a more specific idea of what the review committee will look at. Grimaldi replied there are two aspects that they will look at. The business plan is an action plan and a proforma that works and is fiscally sound. Wanderscheid responded to changes that will effect the business plan in a positive manner. Grimaldi added that an important part of discussion is where they want to be in the future, what are the goals.
Christensen inquired about an effort to replace large customers that were lost. Wanderscheid answered that the approach with data has been reactive, they have not actively gone out and searched for more customers.
Williams stated that AFN was thought to relieve general fund taxes because it would be so profitable
Amarotico inquired about an estimate of savings for Ashland AFN subscribers. Wanderscheid answered that 2 million a year stays in community. It costs $60 in Medford, $29 in Ashland per month, and AFN is superior.
Silbiger questioned expenses that are not in budget. Stated that he could not approve it as it was presented. Laws commented that AFN started on bad footing, the City was overly optimistic, and they donít have data to fully understand future options. He believes that they have two options as a committee, to quit now, or in one more year, look at a new business plan. He doesnít recommend quitting until they have all of the information.
Levine questioned Tuneberg about informally taking this business plan and reconvene the budget committee after AFN has revised it. Tuneberg replied that would be possible.
Morrison questioned marketing budget is too low.. Morrison suggested that is a small budget for marketing, it can be 10% of the total budget for marketing for a competitive market. Wanderscheid added Mike Ainsworth would look into those line items and prepare projections of what we could do if we had more money.
Moore commented that a citizen called and commented that AFN is run as a utility instead of a business, he approves of running it as a business. Wanderscheid stated that is the discussion they have had internally. As a business, they would run as a profit. Williams questioned to add a specific time within a month when the next meeting would occur. Wanderscheid replied in late August.
Hearn Ammended the motion to say August/September 2003.
DeBoer suggested that they reconvene to review the actual numbers for 2003. Tuneberg stated he would have good information by September. Wanderscheid added in conclusion that revenue and borrowing is mostly accurate in budget they were looking at. Hartzell questioned if Lee can produce that in September. Tuneberg replied that could be provided. Levine clarified pages pertaining to AFN and electric section are revised only, not entire budget.
Hearn/Amarotico m/s to accept budget as presented and reconvene the budget committee in August/September 2003, when the budget and businesses plan for AFN are revised. Voice Vote: 13 to 1; Silbiger opposed.
Levine called for 10-minute break.
Community Development 3-83 to 3-89
Community Development Director John McLaughlin presented the budget. He stated there are three divisions and their primary resource is personnel and project related issues.
He presented an overview of the Building Division, adding there are no changes, no additional staff, they have tried to reduce costs where they could. They are fee based, they try to maintain 100% cost recovery. Levine commented the fire department mentioned they do building inspections without a fee. Questioned who is covering fire department costs. McLaughlin replied it could be looked at and see where to charge for that, can look into other communityís system. Moore inquired about Miscellaneous Charges and Fees, they went up from last year. McLaughlin answered Central Service Fee is primarily the new building remodel.
McLaughlin stated the City receives between $200-225,000 from the federal government each year. They retain 20% as administrative costs which funds part of a planner position and part of an account clerk in finance. No changes are proposed. Goal is to address affordable housing with ACLT and RCD for specific projects they are doing. They are at risk of future grant awards being reduced from the federal government, because of difficulty of buying land by the non-profit corporations; they are not spending the funds. They will report to the council at the end of May about status of grants. Hartzell inquired about purchase services, percentage breakdown, how the City spends it. McLaughlin had no answer. Morrison questioned on page 4-8 under Resources, Long-Term; line item for planning division services, building division services dropped $129,000 down to $75,000. Explanation needed. McLaughlin answered that is the building fee costs for the new building annual rent. Those are internal charges, revenues that the department receives goes back to cover cost of the building. Tuneberg said that Other Permits and Fees for building and planning, a percentage of that is calculated and set aside, that is the delineation from total number that has come in. Levine inquired about converting Golf Course to affordable land. McLaughlin replied they have not considered it at this point.
McLaughlin gave an overview of budget, regular staff reduced where they could. He talked about the temporary fulltime Housing Specialist position. There is $86,000 budgeted for position that includes salary, computer, travel and training, etc. Everything else remains the same with PERS increase, and one or two employees are still on the step increase.
Williams inquired about the CDBG program, 20% funds two positions, would that be available to fund housing specialist. McLaughlin replied CDBG funds are specific to administrative for that fund, existing staff is taking on housing duties now, and they need more resources and committee agreed. Hartzell questioned for clarification regarding Molnarís availability to assist with the housing program.
Moore questioned why we didnít hire a part time person. McLaughlin answered they advertised for a temporary six-month position. After receiving applications, there was concern those applicants couldnít accomplish the goals. Qualified people were not interested. Council agreed to fund as a full-time position.
Christensen questioned if could be filled on a one-year contractual basis. McLaughlin answered it would be councils choice to do that, in his opinion, it wouldnít be successful in implementing the action plan.
Levine questioned if action plan encompassed job creation as well as lowering the cost of housing? No. DeBoer concerned that the position may cease to be if morphed into something else. He stated it is unfair to say full time perm position with the city, it depends on performance.
Williams added he would like to know specifically what $86,000 would provide, a cumulative goal for affordable housing in Ashland. McLaughlin stated they would be hired to implement the action plan, the first step is establishing housing trust fund and trying to get funding for developing other trusts. They will try to achieve program balance and to retain levels of diversity.
Laws pointed out that there should be a complete report of accomplishments at the end of the year, there should be performance indicators. Levine questioned what the goal of this position is. McLaughlin described that the specialist will have strategies to obtain. Levine questioned if plan defines affordable housing.
Laws mentioned the City needs research and to work hard to develop concrete plans. DeBoer pointed out the new position in budget, canít be accomplished in only six months. Expressed the need for High-density housing.
Levine questioned the goals and how the City would hire without having goals for the new specialist in place. Hartzell noted the job description goals. McLaughlin stated they have looked at the applicants off of that.
Amarotico expressed concerns if it is possible for the position to be filled for the $86,000? McLaughlin answered that they have advertised for it and have received qualified applicants.
Hartzell/Jackson m/s to accept the Community Development budget as presented. Voice Vote 7 to 6 motion passed.
Accept Community Development budget as presented. 7 to 6 passes.
Tuneberg said lunch was provided and suggested breaking for lunch and resume with presentations. Moore suggested limit meetings to four hours.
Police3-33 to 3-39
Police Chief Scott Fleuter and Mike Bianca presented for the Police Department. Fleuter gave an overview of the Department, presenting goals and training, dispatch conversion. Reduction of 7 FTEs for dispatch. Significant reduction in Annual Fees dropped in maintenance mode. Pointed out school resource officer program, position in police budget, future impact of Parks CAP officer.
Committee questioned how much we are paying Medford for contracted services and savings. Fleuter answered $257,000. Get $86,000 back in 911 revenue, Medford would get that, total $343,000 for service. Fleuter added overall budget has actually decreased referred to page 3-39. With future savings, there is the possibility of new positions.
Hartzell inquired about Parks budget, taking two positions out. Fleuter recommended in budget to keep those programs going, issues with quality of life, the Park patrol seasonal, about 8 people out of park budget.
Hartzell inquired about transition due to staff in the military, and overtime that was incurred. Fleuter answered the overtime budget projected higher overtime. This next budget will be higher.
Hartzell questioned how to control it, how much more this year than last. Fleuter answered it has gone up in overtime several thousands. More generation of workload generated by more officers on the street, more staff, more training. They will trend the overtime to see how much is needed.
Hartzell questioned cooperative exchanges with staff. Cost benefit on DEA and swat (Medford) what the City is paying for the officers to participate. Fleuter answered $104,000 in overtime on that unit. Bianca added the City spent $90,000, proposed $84,000 for current, significant clarified overtime, new hires donít count towards staffing when in training. Criminal indictment monies would come to the city and casework is still significant revenue. Officerís train with the Medford tactical team in drug use and sales of drugs, and the Swat team tactical team.
Hartzell questioned the cost. Bianca answered $7,100 for equipment and training for 1 officer, sometimes overtime.
Hartzell questioned training manager cost, what position will do now. Fleuter answered paperwork, work retained to assistance liaison in transition, accreditation standards, track, training manager, policy development for review.
Hartzell questioned cost. Fleuter answered that CCIS may pick it up for us again$1,500 annual fee, assessment team on site.
Hartzell questioned the MDC grant budget. Bianca answered the grant was for $150,000, $50,000 in matching funds, of that $200,000 total so far they have spent $75,000, spending the rest will get them three years out as far as computer equipment, should not be additional cost for 3 years out. Fleuter added successful programs would cut down dispatchers time on the radio.
Hartzell questioned the Youth Diversion Officer under courts, still in profile to move next year? Fleuter answered that he didnít know. In this budget she is in the Police budget. A decision will be made shortly.
Morrison questioned to clarify overtime presented in the budget for the following year. Fleuter answered in future yearís factors are, turn over, retirements, protests. Bianca said they are addressing short-staffed habits, vacations, and when the shift supervisor wants more staffing. Message to supervisors is to watch overtime. Fleuter added studies have been done on minimum staffing. If all positions filled, 16 FTEís can keep overtime down.
Morrison questioned who pays for overtime. Fleuter responded overtime is funded by personnel costs and they have not had to transfer monies, they have used money within department. Hartzell questioned if there is a strategy to spend less than budget? Fleuter responded there are some things they cannot control. They are looking at reducing overtime. Bianca added they raised red flag about overtime in December and they will start to track it again in July.
Williams/Moore m/s to approve the Police budget as presented. Discussion: Voice Vote: All Ayes.
City Recorder/Treasurer 3-29 to 3-31
Finance Director Lee Tuneberg presented the City Recorder/Treasurer budget for Barbara Christensen. He pointed to page 3-31. He addressed improving laserfische snapshot software and the bigger change is in Materials and Services. Everything else stayed equal or decreased. Levine questioned why personnel costs in this department do not go up as much as other departments. Tuneberg answered it is individualized to each employee, for instance if they are not a PERS participant, and hourly wage impacts benefits.
DeBoer/Morrison m/s to approve the City Recorder/Treasurerís budget as presented. Voice Vote: All Ayes.
Administration - continued 3-3 to 3-13
City Administrator Gino Grimaldi began by talking about issues left over from last meeting. He mentioned the City Source newsletter alternatives. He referred to a memo discussing four options. (1) Reducing costs by changing paper. (2) Not do it monthly, get away from timely articles. (3) Using utility bill insert. (4) Use newspaper as distribution tool. Levine questioned the goal. Grimaldi answered the goal is that it is a tool to supplement information, present city issues. Levine questioned if goal has been accomplished. Grimaldi answered that he has no way of knowing. Would have to ask people that are receiving information. Silbiger questioned option (1), $24000 savings per year, what is that? Grimaldi responded 5-10% Communication Managers time is spent on City Source. Silbiger mentioned doing the $6,000 design in-house. Hartzell pointed out the City Recorderís office produced the City Source at first and questioned if they could assume this task again. Williams questioned the Sneak Preview; will it reach audience that the Tribune and Tidings would? Sneak preview goes out by itself-all conclude
Hartzel moves to reduce to $15,000 pr year, Williams seconds
Discussion: DeBoer prefers option (3), specific issues to each home also good idea. Jackson adds she prefers it as a separate mailing monthly, it has timely articles, hesitates cutting it back. Option (1) cuts cost in half. Amarotico agreed with Jackson stated the city has a budget of $90 million, if they are willing to cut $50,000 from communicating with the public that seems that the City will look cheap. Hartzell states she is willing to amend the amount for a year to fund the City Source Newsletter from $48,000 to 24,000. Morrison adds the purpose is not to only save money but to use it better. Use it more efficiently.
Hartzell/Morrison m/s to reduce the current funding for the City Source of $48,000 down to $24,000 a year. Voice Vote: Williams Jackson opposed 9 to 2.
Communications Manager Position
Levine states City Administrator would like 6 months to review. Moore suggests waiting until review AFN in September. Grimaldi accepts.
Moore/Laws to approve the budget as presented and including post passage report ask that the City Administrator give an update of the status of the Communications Manager position at the August/September budget committee meeting. Voice Vote: All Ayes.
Grimaldi mentions if the City can bring it in house. The current provider does not use html and there would be issues with regards to training. Discusses that the City is looking at e commerce.
DeBoer/Morrison m/s to accept report as presented. Voice Vote: All Ayes.
Ken Mickelson presented to reduce request by $17,000 to be $133,000 to maintain school grounds. Hartzell questioned of the $205,00 how much was spent directly on that task and how much will be spent up until the end of this fiscal year. Mickelson replied $205,000 roughly anticipated. Jackson clarified the accounting actual costs, the projected costs at $63003, $155,000 difference between that and $205,000 are things that havenít been done yet. They include potential unemployment claims, the need of $155,000. There was a discussion regarding the funding. Jackson mentioned in addition to the enrollment numbers going down, the state has been reducing the amount of funds given per student by 30% each year. Williams suggested there are programs in Ashland where there is room for cutbacks. Laws added the choice was made last year, the choice was made to let school grounds go down rather than cut back programs. Hartzell added another way to look at is to reduce the amount the city offers schools. Tuneberg anticipated different options. Option (1), to move back to street fund to free up $151,000 in the General Fund. Option (2), to look at requesting a reduction of 4.7% in proposed budget in materials and services fund, excluding grant monies. Option (3), identify a revenue source, an example would be to require a 10-cent per $1000 property tax increase. Option (4), contract program, doubling budgeted monies in central services. $74,000, looking for $84,000. Option (5), donít fund it. Grimaldi expressed concerns about option (4), not appropriate to pay sewer money for this type of activity. He preferred option of using street fund exchange. DeBoer questioned regarding street fund using parks. Gino clarified moving it doesnít change the way it has been done presently. Jackson added in the public works budget, parks are doing maintenance on grounds. Mickelson replied it could be absorbed in street fund. Tuneberg added to look at funding sources that comes to the street fund from revenues, which should reimburse the street fund.
Williams/Jackson m/s to transfer $151,500 from the General Fund, for the streets maintenance program, to the Street Fund. Voice vote: Hartzell opposed 10 to 1.
DeBoer/ Approve transfer the$133,000 school grounds maintenance at$133,00 by a transfer from the General Fund to Parks. Voice Vote: Hartzell opposed 10 to 1.
DeBoer/Moore m/s to modify request from social service grants to approve $9000 to Community Works, $9000 to ICCA Total of $18,000.
Jackson discusses recommendations. Hartzell tables motion Moore/Hartzell table motion all ayes.
The meeting was adjourned at 2:02pm.
Administrative Secretary to the Finance Director