Budget Committee Meeting
May 15, 2013 6:00pm
Civic Center Council Chambers, 1175 East Main Street
CALL TO ORDER
The Budget Committee was called to order at 6:01.
Mayor John Stromberg, Committee members Everson, Heimann, Runkel, Stebbins, Marsh, Morris, Slattery, and Voisin were present. Thompson arrived at 6:37 pm, Rosenthal arrived at 7:36 pm, Daehler arrived at 8:16 pm & Lemhouse arrived at 8:25 pm. Keil was not present.
APPROVAL OF MINUTES DATED
ANNOUNCEMENTS FROM BUDGET COMMITTEE
Kanner addressed Mr. Runkelís question from the previous meeting regarding how the PERS rates are determined. He explained that he has an actuarial valuation handout available for those interested. It is a very complex method used to determine the Cityís PERS rates.
Kanner stated that in 2007 the City Council began reviewing the Capital Improvements and he was not aware of that previous practice. He stated that it was added to the Council agenda for the May 21st meeting.
Vanston Shaw, 180 Lithia Way #208, Ashland. Read the letter that was handed out (see attached).
Abi Maghamfar, 451 N. Main St. Ashland. President of the Ashland Lodging Association.
The City is losing TOT revenue by not enforcing illegal vacation rentals. 73.3% of that lost revenue is a loss for the General Fund. 77 licensed lodging establishments within the City.
Ellen Campbell, 120 Gresham, Ashland. She supports the Code Enforcement officer. In addition to the lost revenue there is an increase in short term rentals which are unavailable during the tourist season which poses an issue for rentals.
Lois Van Aken, 140 Central Ave. Ashland. In support of the Code Compliance Officer. Ashland Lodging Association.
She supports the ad package for the Code Enforcement Officer. She pointed out that this would help to free up some time for the Plannerís. She also stated that this would show good faith towards those VRBOís that do comply.
Bill Molnar, Michael Grubbs and Brandon Goldman
The Community Development Department is responsible for 5 program areas: Long Range Planning, Current Planning, Code Compliance Ė Land Use, Building Safety and citywide coordination, Housing (& Human Services), and Building Safety.
Much of the work within the long Range Program is directed at fulfilling key Council Goals related to: preserving Ashlandís quality of life, planning for diverse, efficient and sustainable municipal infrastructure, increasing opportunities for the public to be engaged in these efforts, assisting and guiding with decision-making now and in the future, and by planning ahead, the community has a better chance of meeting its goals and expectations.
This past year significant resources have been directed toward producing a master plan for the Normal Avenue Neighborhood. They anticipate the draft plan to be complete in early or late fall. They recently completed the 1st draft of a New City Land Use Code, which involves a complete restructuring of the code and consolidation of all city land use standards into one complete document. They have been successful in obtaining approximately $135,000 in extremely competitive grant funds that provide additional expertise and technical support as well as improved public engagement for both projects.
Over the next Biennium they anticipate partnering again with Public Works staff on a project to review the Downtown Plan, which will focus on circulation, parking management and include and evaluation of zoning within and adjacent to the downtown area.
The accomplishments of the long range program are measured by completing long range projects within an 18-month period, and conducting exit polls to measuring citizenís satisfaction with the design and format of our public engagement opportunities.
The Current Planning program has a day to day role in the implementation of Ashlandís comprehensive list of land use standards. Current planning staff reviews a variety of zoning permits and land use applications, most of which require public notice to neighbors or public hearings. They anticipate evaluating a combined total of approximately 400 zoning permits and land use applications this year which would be the highest number of permits and applications in the last 3-years.
For the 3rd consecutive year they are seeing an increase in activity based upon some common indicators, such as zoning and land use permit activity, pre-application conferences, phone activity and by tracking actual numbers of walk-in customers. The number of walk-in customers hit a 3-year high mark of 310 walk-in customers this past January, which historically is one of the slower months.
Additionally, much of the work in the current planning section involves working closely with a variety of city commissions and committees. It is one of the Council Goals to improve the effectiveness of the city commissions by improving communication between advisory commissions and Council.
Over the next biennium, the Commissionís will assist Community Development staff with programs and projects related to several Council Goal such as the Historic Commission will assist in evaluating opportunities to promote increased preservation of historic buildings, specifically individual homes; and assist in the analysis of zoning around the downtown as part of a Review of the Downtown Plan; and a combined Housing and Human Service Commission will continue to work on ways to reduce the incidence and impacts of homelessness, and also investigate funding and zoning strategies targeted to produce more affordable and workforce housing.
They measure their Performance in the Current Planning Section by looking at the percent of planning applications complete at filing, and the average review time to process a planning application. They have found that the better they can do at the front end of the process, the better chance there is that the application will be complete, and contain all information needed to effectively review the request.
Approximately 1/4 to 1/3 of each of the two Assistant Plannerís time is spent on City Code Compliance. Their efforts are largely ďcomplaint drivenĒ. Much of that time is spent on violations related to the Cityís Land Use Code and other development activity. Additionally, they assist in coordinating all city code compliance issues by maintaining a master list of all code compliance matters across all City Departments. They interact weekly with staff from other city departments on code compliance and will conduct meetings with all city staff (10 staff Ė Building, Streets, Engineering, Police, Legal) involved in compliance, in order to share information, coordinate action on properties with multiple code infractions and ultimately to avoid duplicating efforts.
Through the operation of these Code Compliance activities citizens, property and business owners and our local institutions can be assured that construction and land use activities that pose an immediate threat to public safety are addressed within 24-hours of notification; all others within 72-hours, staff makes every effort to apply fair and equal enforcement of city regulations and make sure citizens can easily notify Code Compliance of possible violations while respecting the individualís request for anonymity.
They fell short of their target of responding to all general complaints within 72-hours. This was attributed to the increase in development activity and related questions.
Add Package: Code Compliance Position
The Council has requested that they evaluate reinstating the Code Compliance Position. The Compliance position was created and filled in 1996. The position was eliminated at the end of 2008 along with other reductions in Community Development Department staff. The moderate but steady upswing in activity has challenged staff to stay on top of compliance issues, while still meeting targets for customer service and timely and responsive review of land use and zoning permits. Additionally, the upswing in short term vacation rentals has presented a new challenge, requiring resources beyond what is currently available. With the elimination of the Code Compliance position in 2008, code compliance responsibilities were distributed throughout the organization, with Comm. Dev. maintaining the role of overall coordination. Compliance activities shifted from both being compliant-driven and pro-active, to primarily compliant driven. It is estimated that for every 10 additional vacation homes, there will be an increase of $22,000 in annual TOT revenue.
For the third consecutive year, general development activity showed a moderate rate of increase.
This continued steady increase in Development and Construction Activity will direct resources away from long range planning efforts, making more challenging to stay on track with project timelines and goals for customer responsiveness. They feel they should be prepared for continued reductions in CDBG grant dollars. If the SOU project is backed out, total valuation of construction is expected to show a slight increase. They are cautiously optimistic that this will continue through the next biennium. Residential construction had a significant jump on activity. Projects previously foreclosed upon have been purchased and are experiencing renewed activity. 37% increase in valuation for residential construction from last year, 78% increase in # of new home permits, MF Construction 120% increase. Valuation of New Commercial Construction and tenant improvements are down, planning approvals are up.
Some of the challenges ahead include making opportunities available to create incentives to further land use and economic development objectives, rather than mandate. Also, continuing to review costs and benefits from technological advancements in the areas of permit tracking, code compliance and land use planning software systems.
The question was asked if the budget is adequate to take on adjacent zoning issues within the downtown areas. Molnar answered that it would likely need further discussion by Council since it was a Council goal.
Stromberg stated that there has been an increase in illegal VRBOís. He wonders if it might be possible to partially fund this position for 1 year to gauge the amount of work. Molnar stated that the main intent of the position is compliance and not so much enforcement of violations.
Voisin asked if the number of illegal VRBOís collecting TOTís but not paying the tax are known. Molnar stated that they know of at least 3-5 VRBOís collecting the tax.
Runkel stated that he had consulted the City Attorney to see if he has any conflict of interest due to him owning a bed and breakfast in town which he was told there is no conflict of interest. He asked if any illegal VRBOís have come into Compliance since the letters went out. He thinks that maybe we need to get the word out there that we are actually enforcing this. Molnar stated that they started accumulating data on the illegal VRBO issue. They began by sending out warning letters. Since they began working with the Legal department 4 VRBOís have been issued citations, been fined and have seized operations.
Heimann is concerned that the enforcement of the VRBOís which wasnít previously handled by the Code Enforcement position isnít enough. Molnar stated .70 is the overall time spent on code compliance with .5 of that being spent on VRBOís. Kanner stated that they arenít only doing this to free up the time of the Planners. This position actually frees up time across all departments.
Stebbins asked if the .70 time spent on code compliance is spent on handling a broad spectrum of compliance. Molnar stated they are primarily focused on development related compliance.
Runkel asked why the illegal VRBOís havenít come into compliance. Molnar stated that most of them are located in an R-1 zone.
Stromberg called a point of order.
Kanner spoke to the issue of potential VRBO tax fraud. He stated that not only are these establishments committing fraud by not paying the City TOT but they are also committing fraud by not remitting TOT tax to the State which they are hoping the Department of Revenue will assist on.
Scott Fleury, Mike Morrison Jr. and Mike Faught
They showed 3 videos highlighting the day-to-day operations within the Street, Water & Wastewater areas.
They also have CIP projects related to the Transportation System Plan including overlay projects, slurry seal maintenance, grant funded sidewalk projects.
They have 1 ad package in this biennium; street user fee analysis.
They also have CIP projects that were identified in the Water Master Plan & financial analysis. It recommended 10% rate increases in each year to fund the CIP projects such as Sediment in Reeder Reservoir, Reeder Access Road, TID Terrace Street pump station improvements, TID canal piping and the emergency TAP pipeline.
They have 1 ad package; cost of service study.
They also have CIP projects related to the Wastewater Master Plan & financial analysis. It recommended 10% rate increases in each year to fund the CIP projects such as Oxidation Ditch, relocation of existing outfall, shading, trunk lines,
They have 1 ad package in this biennium: camera van which includes the replacement of the camera equipment and the chasis.
Stromberg-During the Water Master plan process there was a financial analysis done and he questioned why we didnít do a Cost of Service study at that time.
Faught explained that the financial analysis looked at the total needs and how that would be paid for. Since that plan they looked at conservation and they want to be sure that rates are being charged fairly.
Marsh- Asked what the ongoing costs cover for the camera van.
Faught stated that the ongoing cost is for an increase in rents due to the purchase of the vehicle.
Morris-Where do you expect to be at the end of this biennium for Pavement Condition Index (PCI)?
Fleury stated that he expects they will be back to the previous yearís rates for overlays if they complete the overlays and slurry seal projects.
Faught stated that he wants to look at a rate analysis to see what funding is necessary to get back to those rates and stop the reduction in the PCI rates.
Slattery asked why consultants are needed to complete the cost benefit analysis when we should be able to complete it ourselves.
Faught stated that there are only 6 people on the engineering side. Their job is really to keep up on the regulatory side (FERC), manage the entire CIP and inspect right of way permits. They feel it is cheaper to hire consultants in those specific areas as those projects come up rather than employ additional staff with those expertises on an ongoing basis.
Stebbins asked Kanner about the B Street maintenance. As far as the budget is concerned how is it budgeted?
Kanner stated that the project is shown in CIP but it is funded by savings. The revenues are budgeted for other projects but if they arenít spent on those projects then they will be spent on this ad package. The net impact isnít listed which is what should really be listed as financial impact. The total overall impact is what is listed in the ad package list.
Stromberg asked about the tree shading. How does this end up being in the CIP plan?
Faught stated that the funding side will be brought to the Council next Tuesday through a DEQ low interest loan.
DeeAnne stated that she doesnít understand the ad package list.
Faught explained that the ad packages shown are simply additional projects that donít necessarily have a net financial impact.
Heimann stated that the major TSP was done but yet no study was done on the downtown study and now the downtown study is being requested.
Faught stated that the TSP was never intended to drill down into a specific area. Now they would like to drill down and do a specific study on the downtown area which would have had a budgetary impact on the TSP if done at that time.
Marsh was on the Transportation Commission and stated that the people involved just didnít have that level expertise needed for the downtown study.
Recess at 8:06
Back at 8:12
PROPOSAL FROM MAYOR RE: AFR
Kanner stated that he has met with the Chief and they feel like they have worked out a possible plan to fund the fire inspector by eliminating a very old ambulance that isnít being used. By doing so they can use the funding previously designated for the fire inspector to fund the Firewise Coordinator.
Stromberg spoke to the White Paper that was distributed to the committee regarding AFR funding. Originally AFR was budgeted for 10 Ĺ million and 6 Ĺ million in stimulus funding was received. The team has been together on this project for 3 Ĺ years now and is very valuable to the watershed. The Forest Service has been squeezed but funds are so tight that the Forest Service is unable to maintain the watershed. The National Forrest Foundation approached the City of Ashland to explore possible funding. The Chamber of Commerce is involved in possible fundraising. The amount of funding necessary is unknown at this point until they are in the thick of it. The Firewise program is also a necessary component. The proposal is to use the last of the Cityís max tax rate of 8.9 cents to fund this, which is approximately 185k per year in additional funding and that is what is necessary for AFR. He stated that he has requests for appointments out to various people who can assist in reaching out to our congressional reps.
Slattery asked how long this funding would be required. Chambers answered that it will take 4 years and then ongoing maintenance would be required after that.
Stebbins said that she feels like we should go to the cap and setup a Reserve Fund.
Lemhouse spoke to the inability to bind future budget committees. He wonders if one option would be to use the proposed add package funding for the AFR funding.
Thompson believes that the potential commitment is questionable. She is reluctant to increase taxes due to the questionable nature of the funding.
Stromberg stated that this is not a project that we have a choice on. It is a project that needs to be finished in order to prevent a catastrophe.
Heimann is reluctant to increase taxes due to the burden that is placed on the citizens and he feels that we need to look at the whole package and not just increasing the tax rate.
Daehler believes that we need to take a look at what the cost is to prevent a catastrophe versus what it costs to fight a catastrophic fire. She also asked what percentage of the logging has been completed.
Chambers explained that the City of Denver had two catastrophic fires. The extra cost associated with the removal of sediment in the Denver watershed was 33 million. SOU did a capstone on what the cost would be to clean up after a catastrophic wildfire here in Ashland and they estimated the cost at 13 million. They have completed about 3,000 acres of the 7,800 acres. The initial AFR project was a 10 year project.
Rosenthal doesnít think that anyone is questioning the importance of the AFR project but he is uncomfortable with only having the 1 option for funding.
Marsh asked about the maintenance piece.
Chambers would like to see the project work finished before the maintenance piece.
Runkel stated that Senator Merkley is on the Senate Appropriations Committee and he feels like he would be a good person for us to approach. The Federal budget isnít decided yet for FY14 and he wonders if the Million dollars in logging could buy us a little time until the federal funding is decided.
Stromberg spoke to what would happen if we do wait to see what happens with the federal budget and in the meantime we spend the million dollars and then the project would simply be put on hold until funding is secured. We are trying to be aggressive in securing possible funding.
Slattery isnít sure why it requires the money to be earmarked.
Stromberg stated that the money actually has to be expended.
Chief Karns stated that Congressional staffers told us that we have to begin expending the money in the budget.
Marsh feels like we may look to funding this in place of some of the other ad packages.
Everson encourages everyone to look at levying the full tax rate to fund this project.
Voisin also agrees that the full tax rate be levied for AFR.
It was pointed out that an 8.9 cent increase in the property tax rate is an average of $22 per year in additional taxes.
Lemhouse noted that it is nice to see everyone in agreement that the AFR project is important and now it is a matter of how to fund it.
The meeting was adjourned at 9:13 p.m.
Tami De Mille-Campos