Budget Committee Meeting

Draft Minutes

May 22, 2006 7:00pm

Civic Center Council Chambers, 1175 East Main Street

CALL TO ORDER

The Citizen’s Budget Committee meeting was called to order at 7:02 pm on May 22, 2006 in Council Chambers at 1175 East Main Street, Ashland Oregon.

ROLL CALL

Mayor Morrison was present.  Councilor Jackson, Silbiger, Hartzell, and Chapman were present.  Budget Committee members Bond, Everson, Stebbins, Thompson, Levine, and Gregorio were present. Councilors Amarotico and Hardesty were absent. Committee Member Mackris was absent.

STAFF PRESENT:   MARTHA BENNETT, CITY ADMINISTRATOR

LEE TUNEBERG, AMINISTRATIVE SERVICES DIRECTOR

                                    MIKE MORRISON, PUBLIC WORKS SUPERINTENDENT

                                    JIM OLSON, ENGINEERING SERVICES MANAGER

                                    KEITH WOODLEY, FIRE CHIEF

CHRIS CHAMBERS, WILD FIRE FUELS PROGRAM COORDINATOR         

                                    CINDY HANKS, PROJECT MANAGER

                                    BRYN MORRISON, ACCOUNT REPRESENTATIVE

APPROVAL OF MINUTES

None

PUBLIC WORKS                                       

Lee Tuneberg, Administrative Services Director, Jim Olson, Engineering Services Manger, and Mike Morrison, Public Works Superintendent presented the budget. Mr. Tuneberg spoke to the Capital Improvement (CIP) section first. He stated that the Committee should focus on setting appropriations for the projects for next year however the some projects extend into the future. The CIP is broken into several sections; transportation, water, wastewater, storm drain, electric, administration, and parks and recreation.   He spoke to the summary of CIP for 2007, and the largest section is water. Projects are identified throughout the section with the cost of each year and the total project cost. Transportation projects are street related, local improvement districts, and airport. He spoke to the Jefferson Street extension, $900,000 is budgeted to extend Jefferson Street through an Oregon Economic and Community Development Department (OECDD) grant for half and a loan to be paid back by the developer for the other half.  The Committee clarified that no tax rate increase will be used for this project. The Committee questioned the railroad project and the funding that will be needed for it. Mr. Tuneberg responded that the City will have to look into the priorities and decide how to fund it.

Mr. Tuneberg spoke to the LID’s that are anticipated in the next year. He added that the Committee could propose to use the funding from some of the LID projects that will not be completed to use for miscellaneous concrete repairs. The Committee clarified that the middle part of Clay street will not be a LID. Mr. Tuneberg spoke to the Water Fund, and that the TAP project will need to be completed sooner than they expected. He spoke to the waterline replacements, wastewater plant improvements, and storm drains. He spoke to enclosing the equipment building for the Electric department.  He stated that it is an administrative project, but listed in the Electric section.  It should be under administration not electric since it will not be funded through electric rates. Telecommunications is ongoing repairs and upgrades. Administration is the remodel of Council Chambers and the Fire Station #2 construction dependent on the vote of the people in November.

The Committee questioned if the archive building has to be separate from other City buildings. Mr. Tuneberg responded that it is not a requirement and it needs to be safe and protected. Parks Open space is normally budgeted at $200,000 and comes from the CIP Fund and goes to open space acquisition for Parks. The Committee questioned why computers were not included on this list. Mr. Tuneberg responded that the scheduled replacement for computers is 3 years and costs approximately $1,500 and does not meet the City’s capitalization policy. The Committee questioned if there was a way to see what projects are funded through grants or other sources. Mr. Tuneberg responded that the funding is shown on each project page. He explained that in the administration section, except for the fire station, all will be funded through a portion of internal charges.  Improvement of Council Chambers will come from internal charges or the City could borrow money.  The Fire station will be the only one bonded by vote. The Committee asked when the remodel of the chambers was authorized. Mr. Tuneberg responded that he thought it was two years ago when the City started the process to study it. The City hasn’t decided what the project is yet and whether it is a sound and lighting remodel or a grander improvement. It has not been approved as a project yet.  The Committee asked when the archive building was approved. Mr. Tuneberg responded that it was proposed through the City Recorder department for upgrades or replacement of the current storage facility. Mr. Morrison explained that it is located at the Cemetery and all records are taken there.  The City is using only an insulated shed and shares space with the Cemetery office. The Committee questioned why it would cost $100,000 to evaluate if it can be expanded. Mr. Tuneberg responded that the City will need to look at if they need an entirely new site or if the current site can be modified. There is great need for a temperature control larger setting for the City’s required documents that are required to be retained by law. The Committee questioned why this problem could not be solved through electronic record retention. Mr. Tuneberg responded that the City does use the Laserfiche system but not all documents are conducive to that.

The Committee asked if the proposal to increase water rates 6% is for capital projects. Mr. Tuneberg responded that the City is seeing pressures operationally that require a raise in rates. Indirectly it may pay for revenue bonds to pay for debt service. Personal Services and Materials and Services are driving the rate increase. The Committee questioned the round numbers in the CIP and asked how many were rough guesses. Mr. Tuneberg responded that the people with the experience working on these projects make the estimates and that some years they have been above and some below. The estimates are based on square footage and the true cost is not known until you have the engineers report and get bid. The Committee suggested that staff revisit the costs annually and readjust.

The Committee questioned the park and ride and if the City owns the land. Mr. Tuneberg responded that the City can utilize the land. The City has received federal grants and will receive contribution from RVTD.  The City needs authorization from the county to upgrade the parking area. Councilor Chapman added that he does not want to spend $1 million for parking spots.  The Committee asked if in the future, if the previous years costs could be shown. Mr. Tuneberg responded that in each project, it show the previous years costs.

Mr. Tuneberg gave an overview of the Public Works department budget. He stated that the Public Works Superintendent manages operations while Engineering, GIS and support staff are in another area of Public Works. He spoke to the mission statement. One of goals is to maintain the infrastructure and facilities. Capital improvements are the biggest swing each year. The Committee questioned what the transportation fee was. Mr. Tuneberg responded it is the utility fee the City charges for the use and care of the streets. The City is anticipating a 15% increase based on a flat amount per household. Storm drain is proposed for a 100% increase.

Mr. Tuneberg spoke to the overall Personal Services increase due to a new position as a Water Treatment Plant Operator and the Director returning being included in the budget. The Directors wages were omitted in the previous year and Materials and Services was increased to pay for contracted work in her absence.  It was clarified that the Directors position was included in the position profile in 2006, although her wages were not.

Mr. Tuneberg spoke to the Airport Fund. The City has an airport and the fund has been pretty stable between years. The budget is susceptible to projects that can be funded through federal grants. The Committee asked if a goal is to encourage growth at the airport and if the City had encountered noise problems. Mr. Olson responded that they have noise controls for take offs and there have not been many complaints. He explained that through the application of the land use, the City has a hold harmless agreement where the City cannot enforce noise control. Mayor Morrison added that there have not been many complaints and the match that the City receives on the federal funding is 90%, but there are limits on what the funds can be used for.

Mr. Tuneberg spoke to the Street division. RVTD is budgeted in this division at $290,000. He stated that the budget will need to be modified because the City has been notified by RVTD that it could cost near $800,000 which there is no additional funding for.  The Committee questioned what the City is doing to leverage costs for sweeping as shown on page 3-71. Mr. Tuneberg responded that it is his understanding that the City is looking at maintenance programs to minimize costs. Mr. Tuneberg spoke to the operations division and that it is somewhat driven by projects and some staff are shifted to where the need is. The Committee notes that Public Works makes a substantial contribution to central service fees. Mr. Tuneberg will provide a table showing all departments contributions. Councilor Hartzell arrived at 8:06 pm.

Mr. Morrison added that he approves of the charges for facilities.  For example the water plant needs repair and by charging the facilities fees, the funds will be put aside for it. The Committee spoke to the free rider program and questioned if there is a contract with RVTD.  Mr. Tuneberg added that the City has already been told that the free ridership will end. The Mayor added that the contract says either party can terminate. 

Mr. Tuneberg spoke to the Grounds maintenance in the Street division. It pays to take care of the plaza and the boulevard and the City pays Parks to do the work. The Committee questioned where the income is shown in Parks. Mr. Tuneberg responded that it is shown in the Parks and Recreation Fund in the long term section. The Committee questioned the seventeen new accounts. Mr. Morrison responded they include parking lots, the islands, and the downtown planters.

Mr. Tuneberg spoke to the Water division. He explained that the Water Fund is a very significant enterprise fund. He pointed to the graphs showing comparison to population. The budget growth cannot always be compared to population growth. Treatment division increases include materials and services, and internal charges. Personal services shows the new position treatment plant operator. He pointed to the need for succession planning and coverage during training and absences. The Committee questioned when the rate increase would take place. Mr. Tuneberg responded that they will hold off on increases until August to see how they finish the year, and are hoping to propose less than the 6% increase in August. The Committee questioned if TAP affects this increase. Mr. Tuneberg responded that project will be paid through SDC’s or borrowings. The increase is for staffing costs and a grant that went away for the forest interface program. The Committee questioned if the portion of TAP that was moved ahead by Council was for maintenance or emergencies, page 3-78. Mr. Tuneberg responded that he would have to look into that. Councilor Hartzell added it was for emergencies not maintenance. Staff will look into.

Mr. Tuneberg spoke to the Forest Interface division and that it is located in the Water Fund, but operated by the Fire department. The budget includes the existing position and benefits. Mr. Woodley added that the position has in the past been funded through grants. The grant money has decreased significantly and they are proposing the City pick up the remaining portion that the grant does not cover. Mr. Woodley gave the history of the program and it was established without a funding source. He explained that it is located in the Water Fund due to the great concern of the water shed. He explained they have an annual contract with a forest consultant which will end this next fiscal year. The Committee questioned how much of the grant remains. Mr. Chambers responded $150,000 in total where 25% is only for the position.  The Committee asked staff to look into assessing a fee to help in the guarding of that area or other sources to pay for it. Mr. Woodley explained that the City does not have legal authority to make assessments outside the City limits, they would have to voluntary pay. The Committee questioned the role of the position without the grant funding. Mr. Chambers explained that he informs land owners, and they need to keep relationships established and maintenance up.  Councilor Hartzell stated that she is supportive of the position but would like it to come back to them with fees proposed or other support.

Mr. Tuneberg spoke to the Wastewater division history. They still have a temperature control issue at the plant and there is one project identified towards that. The Committee asked what are the franchises. Mr. Tuneberg responded it is a fee for being in operation, paid to the General Fund. The Committee asked if the loan for the plant has a fixed interest rate.  Mr. Tuneberg responded that it does. Councilor Chapman stated that these numbers looked reasonable compared to the other budgets.

Mr. Tuneberg spoke to the Administration and Engineering divisions and that they are in the Central Service Fund. The Personal Services increase is due to the return of the Director as mentioned before. Contractual Services decreased from 2006 as well.

The Facilities Maintenance division was in the Central Service Fund last year, now in Capital Improvement Fund. Departments pay rents to this division for maintenance, records storage. The Committee questioned the facilities fees.  Mr. Tuneberg explained that he will provide a table detailing the fees. The Committee questioned what Rental, Repair, and Maintenance was.  Mr. Morrison responded that they pay for all the electricity and utility bills for all the City buildings and the custodial contract. Mr. Tuneberg spoke to the Cemetery division.  He explained that they use temporary employees through the peak season. The Committee asked to clarify the substantial increase in wages. Mr. Tuneberg will look into it and get back to them.

Mr. Tuneberg spoke to the Fleet Maintenance and Acquisition division. Each department pays into the fund to replace equipment. Page 3-98 identifies the pieces. If a piece of equipment is needed and not part of program, the department pays for it and then it becomes part of the fleet.  They are looking at cost effective vehicles. The Committee questioned if the IT department was doing the utility billing upgrade and if the $250,000 was needed. Mr. Tuneberg responded that he will propose that as a cut, they anticipated buying that from a third party and now the City’s programmers will implement their own. The $250,000 will go to the fund balance. The Committee asked if the City sells off existing stock and recognize it as revenue. Mr. Tuneberg responded that they do sell surplus equipment with Council’s approval. The revenue is put back into this fund and the departments that surplus was taken from, gets a credit toward future purchases.

Councilor Silbiger expressed his opinion that the City needs to look at purchasing more hybrid vehicles. The Committee questioned why more had not been purchased. Mr. Morrison responded that in the Police’s case, they need the power that a hybrid would not have.  They are looking at retro fitting diesels, but it an expensive option. The City needs the diesels for performance.

Mr. Tuneberg spoke to the handout for the aerial ladder. See attached. It is not in the budget and the question has been raised if it should be part of the Fire Station #2 bond issue. The Committee questioned if it was possible to have large facilities surcharge to pay for it. Mr. Tuneberg responded it would be. The Committee questioned if this had been part of previous budgets. Mr. Woodley responded that it was proposed in 1993 but removed before it reached the budget committee. It has been part of public discussion and in his research, Ashland is the only city in comparison that did not have this equipment with equivalent buildings to the other cities. Ashland does not have unordinary buildings. The Committee asked what type of ladder it would be. Mr. Woodley responded it would be a 100 foot platform or ladder. The Committee asked if some communities fund equipment like this in partnership with the owners of these larger buildings. Mr. Woodley responded that some developers in other cities have given money to purchase that type of equipment. It was mentioned that throughout the budget, Council goals are not shown in each department. Mr. Bond expressed the need for a significant discussion of the ladder truck at the next meeting before it goes to Council.

Everson/Bond ms to accept the Public Works budget as presented.

Everson/Bond amended the motion to approve the budget less the $250,000 for the utility billing software. 10 yes, Chapman opposed.

The Committee asked to clarify which position was included as an addition in the budget. Mr. Tuneberg responded only the water plant operator, the forest interface position remains, only the grant funding was eliminated. Mr. Tuneberg spoke to the handouts for Wednesday night. See attached. He explained that he will try to have bussing program options as well. Dee Anne Everson, Committee member asked about the positions that have been asked for and the corresponding property tax rate increase.  Staff will provide.      

ADJOURNMENT

The meeting was adjourned at 9:45 p.m.

Respectively Submitted,

Bryn Morrison

Account Representative