Minutes for the Citizen Budget Committee Meeting April 19, 2012 Civic Center Council Chambers 1175 East Main Street
CALL TO ORDER
The Citizens Budget Committee meeting was called to order at 6:02 pm.
ROLL CALL & INTRODUCTIONS
Mayor John Stromberg, Committee Members David Chapman, Douglas Gentry, William Heimann, Chuck Keil, Michael Morris, David Runkel, Russ Silbiger, Dennis Slattery, Roberta Stebbins, Carol Voisin and Lynn Thompson were present. Greg Lemhouse arrived at 7:22 pm.
APPROVAL OF MINUTES Committee member Keil/Thompson m/s to approve of minutes from April 18, 2011, April 25, 2011, May 2, 2011, May 4, 2011, May 12, 2011, May 16, 2011. Voice vote: all AYES. Motion passed.
Committee member Voisin/Chapman m/s to approve minutes of April 21, 2011. Voice Vote: all AYES. Motion passed.
Committee member Heimann/Chapman m/s to approve February 23, 2012 minutes as amended: Commissioner Runkel did not volunteer and recues’ himself on the Grant Subcommittee. Voice Vote: all AYES. Motion passed.
REVIEW OF CALENDAR Committee member Leiman/Keil m/s to approve Budget calendar. DISCUSSION: Committee member Runkel stated he would be leaving at 6:45 p.m. for the May 7 Budget meeting. Voice Vote: all AYES. Motion passed.
Committee member Keil/Voisin m/s to approve amended calendar by leaving May 3 and May 7 Budget meetings on the calendar only if needed and setting date of May 10 as the Budget wrap-up meeting Voice Vote: all AYES. Motion passed.
PUBLIC INPUT Allen Sandler/1260 Prospect/Shared his view of the story behind the origin of the Parks Department and that it was formed as a separate Commission, independent of the City Council. He feels that the City of Ashland has a fiduciary relationship with the citizens of Ashland. He stated that if the Parks Budget is cut that they will be organizing a protest.
Mike Gardner/349 Orange Ave/Shared is view on the history of the City of Ashland supporting the parks, which began over 100 years ago. He feels it is an unfortunate raid of Parks funds. He urged the committee to consider the consequences of changing what has been the status quo for over 100 years.
Dave Kanner, City Administrator, and Lee Tuneberg, Administrative Services/Finance Director, presented the Budget Message and explained the change in how the presentations would be presented. (See attached slides)
Mr. Kanner stated that there were three main points to his presentation: 1) This year’s proposed budget is a balanced budget and the overall goal of a budget is not to cut or grow the budget; 2) Expenditures should exactly equal resources; and 3) There is virtually nothing new within the budget. It is a status quo budget, a continuation of existing services and existing service levels.
Mr. Kanner noted that the City of Ashland’s budget is in good shape. An article was recently distributed by The McClatchy Company which talks about public sector job cuts. Over the course of the last two years there have been more than 3.9 million jobs created in the private sector but a loss of 485,000 jobs in the public sector. This is because the public sector lags the private sector in downturn and recovery by approximately 18 months. The City of Ashland has managed to survive a period of significant public sector cuts without making significant reductions in public services. The City has done this in several ways: Employees have made sacrifices which included going three years without a Cost Of Living Adjustment (COLA). This allowed the city to keep its personnel costs flat for 3 years; Materials and Services cost have not been increasing at a rate that outstrips inflation; Stable revenue streams such as property taxes have helped; and Transient Occupancy tax, Franchise and Utility fees and Conservation efforts have all been key contributions.
Mr. Tuneberg explained the key changes within each department as the following:
Administrative Services – Adding the Assistant City Administrator position;
Legal Department – Placing Assistant City Attorney position under Personnel Services;
IT Department – Funding cuts in Telecommunication Fund due to change in Business Plan; Funding cuts in AFN;
Public Safety Departments – Increase in dispatch due to Emergency Communications of Southern Oregon (ECSO); increase in fuel costs; remodel of Police Department; and managing Ashland forest Resiliency Program;
Public Works Department – Additional staff positions associated with the Water/Wastewater requirements; compliance requirements; updates to equipment and technology; reducing funds paid to Rogue Valley Transportation Department (RVTD) for transportation services; energy audit of city facilities; and increase in cost of fuel and treatment associated with Wastewater;
Community Development – Increase in cost for the Certified Local Government Grant and the Community Block Grant;
Electric Department – Increase of cost associated with purchasing power from Bonneville Power Association (BPA) and the Cost Recovery Adjustment Clause (CRAC); developing a 10-year plan which includes consideration of purchasing the North Mountain Substation.
Discussion was held on the need within the IT Department to have a good Marketing Director and the Electric Department to have good management. It was recognized that there is a difference between the two departments in regards to their management needs. Mr. Kanner stated that the IT Department is in need of a Management Generalist with marketing background. He felt that the Electric Department could be broken down to three main functions: Distribution; Conservation; and Contract Management. He explained that a Distribution Manager had been hired for the Electric Department and that he would like to assign Conservation functions under the Assistant City Administrator position. A Management Generalist would know how to manage a contract and would do fine in this role. He stated that the IT Department is managed through Division Managers who oversee day-to-day functions. He felt that this department needed a person who could implement or update the AFN Business Plan and provide marketing savvy. He voiced his concern that they would be able to fill this type of position but he is going to pursue this.
Mr. Kanner reported that he had not begun looking for an Assistant City Administrator and would prefer to wait at least six months in order for him to complete his transition and learning period. He did confirm that the position is fully funded for the entire year in the proposed budget as is the proper way to budget for a position. He did not expect any additional costs associated with the vacancy of this position and that any unspent monies would roll over into the Ending Fund Balance.
Mr. Tuneberg explained for the Commission that the Water Franchise Fee is currently at 6% and that the projected revenue for Lodging/Meals tax is at 3-4%. He stated that an update to this report was provided in February and the current Quarterly Report is being provided to the Council. He explained that the Council could decide to raise the 6% fee back to the 8% and discussion was held regarding how the recommendations from the Ashland Water Advisory Committee (AWAC) would affect increasing this fee.
Mr. Tuneberg explained that the information on pages 1 through 9 of the Budget Report shows last year versus current year numbers. He stated that the 6.5% increase is due to the one-time fees (Material and Services) associated with the grant project in the City watershed.
Mr. Tuneberg commented that there are items that were not included in the Budget as indicated on attached B and that there is an increase of Capital Improvement Projects (CIP).
Mr. Kanner presented three issues for the Budget Committee to consider:
Reduce Parks & Recreation funds by $263,000 and place funds in General Fund
Increase tax rate to the maximum (.09 increase) and place funds into the Reserve Fund
Convert City to a self-insurance program beginning in Fiscal Year 2014
He understands that Parks & Recreation is important and that it is one of Ashland’s defining features. His intention is to provide the facts utilizing the raw numbers and that the budget identifies all funds requested for Operations which is 11% more than they received in the current year. The proposed budget allocates $350,000 for deferred maintenance, which is on top of the money that Parks receives from the Food and Beverage Tax. Mr. Kanner stated that funds were provided for basic Operations and Maintenance and that excess funds totaled $613,000. The tax rate is $1.84 per thousand (five-year average) and is what is needed for Operations and Maintenance.
Mr. Kanner stated that the City of Ashland is one of few cities who do not charge the maximum tax rate. By increasing the tax rate, it would increase the Reserve Fund by $183,000. He recommended that these funds be used for ongoing expenditures.
Mr. Kanner provided example of self-insured for employee Health Benefits used by Deschutes County. He felt that the City could experience potential for savings by converting the City to a self-insurance program beginning in Fiscal year 2014. He explained that there would be some start-up costs and funds from the existing insurance fund could be used. Staff will conduct a study to determine what the Reserve Funds should be and then contract the services out. By doing this the City would have a greater control over the structure of the program which would benefit the City rather than the Insurance Company.
Discussion was held on this topic and it was noted that the Ashland School District had converted to self-insurance. Staff was encouraged to speak to the School District on how this had worked for them. Mr. Kanner clarified that funding for self-insurance was not in the proposed budget but wanted to bring to the Committee’s attention for future discussion.
Parks and Recreation Director Don Robertson presented the Parks and Recreation Budget (see attached slides). He provided information on the Sustainability Challenge which included:
Adoption of the Valdez Principles
Duck Pond conversions
Pest Management Policy
Mr. Roberts listed the 2011-2012 accomplishments as installation of new lights at Hunter Park, replacement of playground equipment at Lithia Park, upgrade of irrigation at Oak Knoll Golf Course, organic/non-synthetic pesticide use in all parks (with the exception of infields at NMP ball fields), removal of unsafe skate park at Garfield Park, allowing dogs on leash in most parks along paved areas, trail easement approved and built at Ashland Christian Fellowship Church, Upper Clay Street property acquisition, Ashland Creek property acquisition (future trail linkage), new Recreation Coordinator, Facility partnerships and new volunteer opportunities.
He stated that the Volunteer Park Host, Trail Host, Ice Rink Host and Pool Host programs have all been successful and meaningful programs. He reported that 98% of Ashland citizens say they have visited a park within one year. Mr. Robertson presented the Trends Over Time Buy and Build years (1990-2004) which included land purchases, park developments, 29 full time maintenance employees and internal construction. He explained that recreation was a low priority and that it assumed an increase in tax rate.
The Trends Over Time Adjustment/Transition years (2004-2013) which includes a change of staff leadership, additional contracted services, zone maintenance, and a move away from specialized employees, reduced labor force from 29 to 20 full time maintenance workers, customer/demographic driven recreation programs, annual financial evaluations and fiscal stability.
Mr. Robertson clarified for the Committee that the Parks Department is no longer providing Ashland School District maintenance as of 2012-2013. That although the actual charges for actual shows lower revenues, it all depends on how it is being managed.
The Trends Over Time Rehabilitation and Renewal years (2013 to future) include a need to protect investments, prepare for future residents and enhance our balanced fiscal stability.
Mr. Robertson presented the Recreation budget and that it included funding for the Volunteer Coordinator which was funded last year out of the Maintenance budget. It also includes the Ashland Youth Conservation Core Program that targets 8-10th grade students within the community.
Bruce Dickens, Parks Superintendant was introduced and Mr. Robertson commented on how well a job he was doing of managing, developing Parks standards and replacing retiring staff.
Mr. Robertson provided information on deferred maintenance items such as the Senior Center sidewalk, maintenance of the Calle Guanajuato and Lithia Park. He explained that the Parks Commission has identified a project they would like to move forward on but it is more important to provide maintenance in some areas, Lithia Park Enders Shelter and Lithia Park Bridge, before starting any new projects.
PUBLIC INPUT JoAnne Eggers/221 Granite St/Stated that she is the Chairperson for Parks and Recreation Commission. She felt that the City budget process has not worked well. That the Parks Commission will be asking to meet with the City Council to outline the budget process that works for both bodies and provides for better communication. Ms. Eggers believes that we owe it to citizens who have high expectations of their parks and recreation programs.
Rich Rosenthal/Parks and Recreation Commissioner/Mr. Rosenthall recognizes that the budget is a difficult task. Every community strives to attract tourists, increase property values, reduce crime & influence the quality of life. He believes there is only one department that can do all those things. A robust and well funded Parks and Recreation department is an investment in the community. He believes a discussion needs to be had regarding what the Parks system should look like and how it will be funded with the community going forward.
Jim Lewis/Parks Commissioner/640 A Street/In his 26 years as volunteering for the city he has learned a lot about the history of the city of Ashland. He stated that parks are a key component of the history. This is the first time in over a hundred years that Parks funding is moving to the general fund. He thinks the council is fully funding the Parks in the front door and draining resources out the back door to fund extraneous expenses. His point is that if you think Ashland is special preserve it.
Stefani Seffinger/Parks Commissioner/448 Taylor/Ms. Sevenger and her husband have lived here since the 1970’s. One of the reasons they decided to move back was because of Lithia Park. Ms. Seffinger hopes that the communication between the Parks department and the City Council becomes more important. The parks create a vast amount of mental health for the community.
Mr. Robertson clarified for the Committee that the Parks Commission would use the $263,000 toward deferred maintenance and improvement projects. That these funds could provide funding on projects that need to be contracted out due to time constraints. He explained that prioritizing projects that can no longer wait is the justification for the increase amount in the budget. He clarified that the increase of 11% for the Parks budget has been the transfers from the Parks General Fund to the City’s General Fund.
Mr. Robertson addressed the difference in Personnel Services by stating that the employees group had been non-represented to being unionized and then decertified the union. The Parks budget was increased to allow a 2.75% Cost of Living Adjustment (COLA). An error in last year’s budget for Recreation was identified in the benefits section of approximately $40,000, not filling a vacant position and decrease in revenue associated with the Ice Rink due to poor conditions all affected the budget. Mr. Robertson stated that repairs are contracted out and that safety and preserving the endangered amenities are of high priority.
Mr. Robertson stated that the Parks Commission has had discussion on alternative funding sources and leveraging the Food and Beverage Tax. He continued to explain that the increase in Rental, Repair and Maintenance is due to contracting out projects and the need to secure skilled labor. He explained that $595,000 of the $630,000 Capital Outlay projects are being transferred to the Capital Improvement Plan which includes deferred maintenance and replacement of equipment.
Mr. Robertson explained that the Parks Commission has the authority to set the COLA for employees and that the Parks Department employees have not received a COLA increase since 2008. He believes that the City has also budgeted for some COLA’s. The Parks Commission bases the COLA strictly on the consumer price index and not on what the City has determined.
He identified the Atkinson Bridge repairs in the CIP for Public Works budget and noted that this is funded by the Food and Beverage Tax and System Development Charges. The CIP within the Parks budget is funded by transfers.
Discussion was held on the need for better communication between the City and the Parks Department. A meeting that was to be held in November between the Council and Park Commissioners did not happen and may have resulted in loss of communication between the two bodies. It was agreed that there needed to be a commitment to have better discussion going forward.
Comment was made that in the early years a mandate was not set for providing unlimited funds for the Parks Department. Mr. Robertson acknowledged that they had been able to provide a better and less expensive way to improve irrigation.
Staff was asked to bring back information regarding the lower Clay Street purchase and repayment schedule. Also that the revised CIP for the Parks Department be distributed to the Committee members.
The meeting was adjourned at 9:14 p.m.
Tami De Mille-Campos
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