Budget Committee Meeting

Minutes

April 17, 2008 7pm

Civic Center, Council Chambers, 1175 East Main Street

CALL TO ORDER

The Citizen’s Budget Committee meeting was called to order at 6:04 pm on April 17, 2008 in Council Chambers at 1175 East Main Street, Ashland Oregon.

ROLL CALL

Committee members Everson, Slattery, Stebbins, Jackson, Navickas, Gregorio, Thompson, Heimann, Silbiger, Hardesty, Chapman, Douma, and Hartzell were present.  Morrison was absent.

STAFF PRESENT:       MARTHA BENNETT, CITY ADMINISTRATOR

LEE TUNEBERG, ADMINISTRATIVE SERVICES/ FINANCE DIRECTOR

                                    BRYN MORRISON, ACCOUNT REPRESENTATIVE

                                    DIANA SHIPLET, EXECUTIVE SECRETARY

                                    DON ROBERTSON, PARKS DIRECTOR

                                    STEVE GEIS, PARKS DEPARMENT

                                    RACHEL TIEGE, PARKS DEPARTMENT

APPROVAL OF MINUTES

Everson / Slattery m/s to approve the minutes of the 2/13/08 Budget Committee Meeting.  Voice Vote: All Ayes.  Motion passes.

Thompson stated she was approached by a member of the public who asked that the public forum portion to later in the meeting so that they can respond to the presentations made.  Committee had discussion regarding whether, if they moved the public forum, would it take place before or after deliberation.  It was determined that after presentation but before deliberation.  It was agreed that a putting a time limit on the public forum would be appropriate.

Hardesty / Heimann m/s that they alter the time for public input to the time between the budget message overview and the committees questions of staff.  DISCUSSION: Concerns were raised that in order to call people up at the correct time we will need to have the people who want to comment write what department they want to talk about on the public input sheet.  This process would be very similar to regular council meeting procedure which generally goes; presentation-public input-discussion-next presentation.  Everson stated she would vote no unless there was a time restriction on public input.  Silbiger / Jackson m/s to amend the original motion to limit public input to 5 minutes per person.  Voice Vote on amendment: All Ayes.  Amendment to Motion Passes.

Voice Vote on amended motion: All Ayes.  Motion Passes.

Committee member Chapman arrived: 6:10 p.m.

BUDGET MESSAGE

City Administrator, Martha Bennett, and Finance Director, Lee Tuneberg, presented the City of Ashland’s Budget Message. This was a challenging budget to put together but not an impossible budget.  Next Fiscal Year we will be ok but we do need to talk about future years because if things continue the way they are we likely won’t be ok.

The budget was built by planning to do what we are doing today next year.  No positions were added and any additional revenues that we identified as necessary to balance the budget had to be tied to services that will be cut if the committee decides not to add those new revenues.  They used as realistic as possible growth in revenues and expenditures.  All departments had to submit cut packages, some of which they took and any desired increases had to be brought forward as add packages.  The only add packages which made it to the budget committee level were ones related to Council Goals.

First thing they did with budgets submitted by the departments was attempt to balance the budget without any revenue increases.  They looked for efficiencies and every single department’s budget was reduced.  Those reductions were put in because we believe we can live within those reductions.  Every vacant position was examined and some will be left unfilled.  For some positions it was determined that we could not continue to provide our current levels of service unless those positions were filled.  They started off budgeting 4% salary increase for non-bargaining employees but reduced that to 2.5% which will be done in a mix of salary and a new health care reimbursement account.  They reduced contractual services everywhere and significantly reduced travel and training.

Overall the financial health of the City is good but it is not getting better.  In the past there have been many things which regularly saved the city financially which did not happen this year.  Just like everywhere in America today expenses are going up at a faster rate than revenues are going up.  Some of those will rebound with an improved economy, some expenses will not.  The years of having an ending fund balance double of what they put in the budget are over.  The proposed budget does include increases in; property taxes, water, sewer, and utility rates.  It also includes a reduction in employees.  The long term issues will need to be addressed at list in part, prior to FY10 budget process (which means we will likely have budget process starting in the fall).

Proposed budget is roughly $3.5 million more than last year’s budget how does this compare to previous years?  Roughly the city’s budget has been going up fairly steadily at about 2-3% each year and this budget does the same thing.  Tuneberg presented a pie chart which showed the breakdown of the budget by fund.  He then showed budget breakdown by resources and by requirements.  Committee asked if this breakdown includes the projected TOT increase.  Tuneberg stated that no, this does not include that possible increase.  In the requirements slide breakdown Tuneberg noted that the Youth Activity Levy shows in Materials and Services in the FY08 budget and not in the FY09.  We are no longer the pass thru account for that levy so technically this fund has been held flat between FY08 and FY09.

Committee member Douma arrived: 6:38 p.m.

Staff showed the pie chart with breakdown of staffing by fund.  They noted that more than 50% of personnel is in general fund and parks.  Bennett reminded the committee that part of the problem with budgeting is that the majority of the money coming in is in the utility and tax supported funds and yet most of the personnel is in the general fund.  Which means that when we start talking about reducing costs we very quickly have to start talking about reducing people.

Committee asked with borrowing projected at 9.6 % this means budgeted borrowing will be almost tripling between FY08 and FY09 does this mean we are predicting that we will consume an increasing percentage of our budget with debt service?  Tuneberg stated that, yes, this is likely.  They are estimating a one to two percent increase each year just for debt service.  This will likely mean that utility bills will increase to cover the costs to maintain our infrastructure through CIP projects.

Tuneberg showed slide titled “FY2009 Expenditure Categories – M& S – Miscellaneous Separated” wanted to show the breakdown of where the materials and services, as a whole, for the city are broken down.  One of the largest categories is other charges.  Most of this section is internal services charges where departments are sharing the burden of the costs of services.

The next slides he showed is the breakdown of annual debt services broken down by both principle and interest and just principle.  Committee asked what average rate we are paying in interest our debt.  Tuneberg stated anywhere between 1.5 - 6%.  Revenue bonds tend to have a higher percentage, notes are all over as far as costs.  He usually uses around 4.5 -5% as an estimate, recognizing revenue stream and what he has to go through to insure a good bond sale.  Committee asked if on any of our debt we have the ability to accelerate our payment of the debt.  Tuneberg stated usually have a 5 -10 year call penalty involved.  They also can re-finance but only under certain requirements from the state.  The City’s financial advisor is always keeping them appraised of the best time to refinance.  There is a requirement that there must be at least a 3% present value savings on any refinance.

Tuneberg gave overview of the costs of capital projects from FY08 to FY09.  While individual numbers may be dramatically different, overall the change is not that great.  The biggest challenge for the City is that we have lots of things we need to do but it is difficult to get all the conditions right in order to finish the projects.  This can cause wide swings in the ending fund balances it also makes it difficult to predict when the City will need to borrow funds.

Bennett stated there were three funds which were particularly challenging; general fund, central services fund and parks.  In the past the general fund has been saved by large ending fund balances.  That did not happen this year for two reasons.  First, there have been large amounts of turnover.  That is not happening this year which is good for staff and customer services but bad for the budget.  Second, funds we generally have counted on to help the ending fund balance have not helped this year.  This is due to economic factors out of our control like the losing of 109 beds at the Windmill Inn or the cost of fuel which has raised costs of everything except internet service.

In previous years they have always projected the ending fund balance and have never actually spent into those amounts.  This year is not the case.  They have spent money from the ending fund balance and expect to do so next year as well.  Bennett stated that the ending fund balance shown on the chart is with the requested twenty-nine cent property tax increase.  If that is not there the ending fund balance is $529,000 less than the shown $1,155,253.

Committee asked at what point in the numbers do we start spending money out of the ending fund balance.  Bennett stated that the fund balance policy states we are supposed to have a 10% ending fund balance in the general fund which would be about 1.5 million and we are recommending that the committee budget about 1.15 million so we are still short by about half a million dollars.

In 2005, 2006, and 2007 we had years where revenues exceeded expenditures – not by much but by enough to slightly grow the ending fund balance.  In 2008 we budgeted to have expenditures greatly exceed revenues and we are projecting that it won’t be such a great difference but we will still be having more expenditures than revenues.  Next year we are also proposing to spend more than we collect and if trends continue this way we will be spending into the ending fund balance.

The overall general fund revenues are flat.  We were helped a little this year by the school renovation projects.  Emergency medical revenues continue to decline on a per call basis, i.e. we have more calls but the amount of money per call is down which means an overall flat revenue source.  The good news is that health care costs did not rise at the rate they were originally budgeted for.  We budgeted for a 10% increase and we are seeing less than that in premium increases.

In the general fund we reduced overall expenditures.  No services that were cut in last year’s budget process have been restored.

Committee asked what the comparative size of bargaining versus non-bargaining employee groups.  Bennett stated that there are roughly 54 non-bargaining employees plus none of the 49 Parks employees are in bargaining units.  All other employees are in various unions.  She reminded the group that each bargaining unit has different rules or state laws related to bargaining and salary adjustments.

Bennett stated that after the cuts were made to the general fund they discovered that they were in the position of recommending an ending fund balance of $600,000 which is unacceptable because if anything bad were to happen the City would have no money to handle it.  It is not responsible budgeting.  They are recommending that the committee increase property taxes by 29 cents per thousand and increase franchise fees by 3%.  All of the franchise fees would go to the General Fund. Even with those increases expenses would still exceed revenues by $591,000 and the ending fund balance would still be short by $518,000.

Committee member Hartzell arrived: 7:04 p.m.

Committee asked how much the proposed franchise fees would be in dollar amount.  Bennett stated it would be $97,000 for one utility and about $60,000 for the other.  Committee asked for clarification on if budget committee approves the increases and approves the budget as proposed does this mean that there still will not be enough money to have a responsible amount in the ending fund.  Bennett stated, yes, this is correct.

Tuneberg spoke to how they compared the potential tax rate with the proposed tax rate.  Committee asked how much is left between the proposed tax rate and our ceiling for allowed tax rate.  Bennett stated that is 5 cents.  The proposed new Ashland Youth Activities Levy is 1.28 but is not process through the city any longer.  The challenge in regards to property taxes is guessing how assessed values will or won’t change and what the collection rate is going to be.  In recessions people tend not to pay their property taxes.

Bennett went over which services would be eliminated if property taxes are not increased.  Committee asked if the list of service reductions was in any order of preference.  Bennett stated it is in the order she would recommend to the committee, which does not mean it is necessarily the order she would prefer.  Committee asked what other possibilities did not make this list.  Bennett stated other possibilities include; elimination of a building inspector but we already did this in the last budget and are having a hard time keeping up with inspections as it is, eliminate funds for hiring new police employees, eliminate equipment upgrades in the police department, and elimination of the newly formed housing program specialist position.  The problem with the general fund is that it is a 15 million dollar fund and over two thirds of it is public safety and the other one third is municipal court and community development.  If you are unwilling to reduce public safety budgets then all the reductions come from two relatively small departments.  She also reminded the group that in last year’s budget they reduced community development’s budget by over 20%.  There is not a lot of money left there to cut.

Committee asked for clarification on the restrictions on moving monies from one fund to another.  Bennett stated that it depends on the fund.  Providing inter-fund loans is not a good strategy because if you borrow from one fund, under Oregon law that fund must be re-paid.  Which means you may be helping the fund’s budget for one fiscal year but will likely cause more problems in the next.

Committee asked how much in grants we would lose by eliminating the CERT program.  Bennett stated $46,366.  Committee asked why it seems all the cuts offered are in public safety and wanted to know if there is the ability to cut elsewhere.  Bennett stated that not all is in public safety.  For example, code enforcement is in community development.  In deciding the cuts she followed two criteria; 1) last one in first one out and 2) are there vacancies or impending vacancies.

Committee asked if, since there was one Community Development employee who volunteered to reduce to half time, there might be others willing to do the same.  Bennett stated that they had already done some of that in this budget.  For example one of the building inspector positions will be cost shared between the general fund and the public works fund where he will now do back flow device inspections.  We have taken cost savings from two positions in central services which are vacant and moved one employee who might have been cut from Administration over to Public Works.  She stated again that the problem is that revenues are flat and costs are up.  When eleven million of your general fund dollars are in public safety it is hard not to cut without looking at public safety.

Bennett stated that the cuts presented are not in the budget.  They are tied to whether or not the committee agrees to the 29 cent property tax increase.  Committee asked for clarification on this.  Bennett stated that in February the committee requested that if the city were to ask for revenue they had to show what would get cut without that revenue.  She reminded the group that many of the funds are restricted revenue under Oregon State law; enterprise funds must pay for enterprise departments, SDC funds are limited to those uses under which you created the SDC.  So a lot of places where you see extra monies you could borrow but under Oregon law you must repay, with interest, those loans.  You could transfer money to help this budget but it will only cause more problems in next year, and the following year’s budgets.

Committee asked if CERT can be in any other fund.  Bennett stated that would require some research and she will get back to the group with an answer.

Committee asked if the question of employees going to half-time distributed broadly (i.e. were all employees asked).  Bennett stated that they talked about it with the department heads but whether or not they then talked about it with their staff she doesn’t know.  She suggested the committee asked each department head when they make their presentation.

Committee asked if the money going to parks comes out of the general fund.  Bennett stated that when ballot measure 50 passed it consolidated all the tax rates for the City.  The parks levy merged into the city’s finances.  Ever since there has been a “gentleman’s agreement” between the city and parks that basically says whatever the Parks was previously able to levy the city would continue to give them.  The people ultimately who could change that is the budget committee.  Technically the group could take all the parks funding and put it instead into the general fund.  That action, though, would not solve any of our current budget problems.  Tuneberg gave some overview of the previous six year’s tax rates and how they have been raised or lowered.

Committee asked if they had looked at Courts as well for cuts.  Bennett stated they looked at eliminating a half-time clerk.  However, they did not propose it is because there would be significant coverage problems with that position gone.  The court would have to close significant hours because there has to be at least two people there at all times and with this position there is enough flexibility to be open about twice the hours they would without.

Committee asked about the proposed one cent reduction in the library levy.  Bennett stated that they did this because they believe the levy stated it was a two-year levy and so they are suggesting only levying enough to get through to the end of the two years.  They determined the two year timeframe not by the fiscal year but rather by the November one date which matches which the contract with the county services.  If the committee wants to keep the library open the full two years promised by the ballot measure then the city recommends levying the 19 cents.  If they cut that amount at all it will shorten the length of time we can do the extra hours.

Committee asked if there were any circumstances in which transferring monies from one fund to another would not be considered “borrowing” and would not involve the re-payment requirement.  Bennett stated she needed further clarification to understand what the committee is asking.  Committee stated we have 21 million dollars worth of ending fund balance across the city, for rainy-day sorts of issues, now we have reached a situation with the general fund where we don’t have any ending fund balance.  We are not able to take advantage of how much we saved or put away elsewhere.  They are trying to figure out a way to use that 21 million to help the general fund.  Tuneberg stated that the committee needs to recognize that a good part of the 21 million is held-over monies from borrowing to do capital projects.  If you give that money away you can not finish those projects and you will be in violation of the bond covenants.  If it is SDC monies, food and beverage monies, or TOT monies you can’t give that to any other funds.  If it unrestricted funds there is a way to do a transfer.  The city does this with debt service transfers but have never done this to help with a one-year bailout of the general fund.  They will bring back numbers to the committee relating to how much of the 21 million ending fund balance is actually unrestricted.  The other issue, however, is what will the city do next year?  If you take money out of a fund in a loan you have to find a way to re-pay that for next year.

Committee stated we are in transition.  Asked if the city feels there will be greater budget challenges next year.  Bennett stated that yes, this is true.  Committee asked how long the city thinks this downward trend will take place.  Bennett said her guess is about 4 years.  The city needs to not focus on the negative issues but rather come up with things to do to improve the future budget situations.

Committee asked if it wouldn’t be smarter to raise property taxes to their limit this year.  Bennett stated that the problem is that she doesn’t think we have community consensus this year on that course of action and we are going to have to let this be a transition year.

Bennett gave overview of the add packages which are all related to Council goals.  She showed this year’s amounts and gave rough idea of what the costs will be for the second year.  Tuneberg gave overview of current utility rates.  He explained that often these rates have not been implemented in a timely fashion.  Reminded the committee of the most resent changes made to the electric rates.  Tuneberg showed proposed fees for next year.  Stated he models increased on need as well as on projected usage.   

Committee asked if the revenues raised by these various fees can be used in any fund.  Tuneberg stated these are Enterprise Fund rates and are raised to support only those funds.  They are technically unrestricted but in order to use these monies in any other fund either the enterprise funds would need additional cuts or the rates would need to be raised further.  He reminded the group that the Electric Fund thus far has been covering the costs for more than their share of the city’s expenses in order to keep the other taxes or fees lower.

Committee asked if staff could include information about user fees next time because it may be more effective for the city to do gradual rate increases over time but there is currently no easy comparison. 

Committee asked if cuts in the enterprise departments would mean that rates could be increased at a lower rate.  Bennett stated that this has been done in most categories.  Tuneberg stated that every department, when they sat with Bennett and Tuneberg to work their budgets did reductions.  This is done every year.  Bennett stated that they could have each department answer the question, ‘how could you avoid or reduce the rate increase’.

Committee stated they get plenty of criticism related to raising rates and people expect that when rates are raised the City is going to spend that money on the purpose of that fund.  Tuneberg agreed and stated that there are meant to be some logic with regard to franchise and utility fees, they are not meant to be used as operating transfers.

Tuneberg gave an overview of the Systems Development Charges.  Most of these are undergoing an annual review.

Bennett gave overview of Central Services Fund.  Part of the problems relating to this fund is that most of the costs are fixed or are related to people.  Committee asked if the eliminated FTE was a vacant position.  Bennett stated that .5 of it was, the other .5 came from moving an employee from administration into public works.  Committee asked why it is necessary for central services fund to have ending fund balance.  Bennett stated that it is necessary for those unexpected costs such as this year we budgeted $25,000 for recruitment but actually spent over $70,000 or this year we budgeted $90,000 for outside council and this year we are most likely going to spend $225,000.  Tuneberg stated it is not the goal to have a growing or large ending fund balance but it is necessary to keep from going negative when unexpected issues arise.

Committee asked what the desired ending fund balance should be.  Tuneberg stated somewhere between $100,000 and $150,000.  Committee asked about the transfer from all utility funds.  Bennett stated that they wanted to make sure that the increases in costs in engineering should be borne by the utilities.  They decided that rather than lose a person they would rather increase the costs to the utilities as they have the fund balance.  For example, the Central Service Fund has roughly 13 people who do inspections that actually are services for enterprise funds and so they asked enterprise funds to pay more internally for those services.

Bennett gave a quick overview of the Parks budget.  Youth Activities Levy has expired.  They have not asked for any additional revenue.  They have already done a great deal of reductions.  Not included in the presentation was that they are reducing the park patrol by 50%.

Tuneberg gave an overview of the Fund Balance Projections.  This gives a sense of the long term based on what we know today and extrapolations of what might happen in the future.  Each year we make adjustments to keep the various funds doing as well as possible.  There are very few funds that are healthy for the long-term.  The ones that are healthy long-term are tied directly to revenues and will not be done unless there is a revenue source.  Examples are CDBG or the CIP. 

Committee stated, if we do as we did last year, and hold revenues flat while continuing to grow revenues eventually all the funds will be unable to meet their ending fund balances.  Tuneberg stated that is true, and last year all the fund balances did look worse in projection.  This year we identified rate increases necessary and those were built into this budget.  However, there are still funds that, even with the rate increases, will not meet ending fund balances.

Bennett gave overview of the long term recommendations.  She suggested the group consider levying the full $.34 rather than the $.29 recommended and put the nickel difference into restricted reserves to buy a little bit of budget room next year.  Committee asked how those funds would be restricted.  Bennett stated that the committee could define it however it deems necessary – most likely the best would be to hold it for emergency situations.  She also suggested that this Fall the council and the parks commission should sit down together and have a discussion to consider how to deal with future service levels as well as revenue options.  There are some good reasons for not dealing with the process the same way every year.  There are some things they could do, both considering what we do and what we provide as an agency and how we pay for them.  Unfortunately, there isn’t any obvious or easy solution to any of this and that is why these discussions are necessary.  Lastly, we need to start talking about the Food and Beverage Tax so that when it sunsets we know how we will be handling the potential loss of revenue.  This conversation has already begun in the community so we need to start talking about it as well.

Committee asked about raising the whole 34 cents which would help for next year but is also the highest it could ever go.  Bennett stated that yes, it is the maximum but the committee could decide to do something else like other taxes, fees, rates, etc.  We can not continue to provide all the services we currently do without finding ways to pay for it all.  We have been very fortunate that because we have so many diverse sources of revenue we, as a community, are just hitting this difficult time now – many other communities have been dealing with these challenges since 1998.

Committee asked how the discussion relating to future services relates to the ad package relating to Council’s goal for fiscal stability.  The goal is look at how we manage revenue streams, identify problems we have, etc.  These are the sorts of things council has been asking of Finance for years, but Finance does not have the staff to work on the answers.  In addition to their other goal related duties, the person handling the fiscal stability goal would help to lead and focus the proposed discussions between city and parks.

Committee stated the real question we need to deal with is can Ashland afford Ashland.

Committee asked what effort was made to go beyond just department heads to understand the attitudes of the average employee in regards to changes to health care benefits, etc.  Bennett stated we have formed a employee labor management team to look at health care.  The chose the Preferred Provider Program because most physician in the Rogue Valley are members of this particular group, so the relative impact on employees wasn’t significant for a first step.  The employee management team went out and discussed it with the employees, who for the most part were content with the choice.

PARKS

Don Robertson, Parks and Recreation Director and Mike Gardner, Chair of the Parks Commission presented Parks budget.  Parks budget is unique to other city departments.  It is the only budget which has public input and is approval from an elected body prior to submission to the budget committee.  They gave an overview of the organizational chart and how the employees are divided between parks functions and recreation functions.  This year they have reduce staff by eliminating one custodial position and one park worker position.

Garner gave an overview of the major accomplishments for FY 2007-2008, including a dramatic increase in registration for the recreation programs.  In last fiscal year 2,000 students participated in programs at North Mountain Park.  This was due to a joint effort between the school district and the parks department.  This program costs about $66,000 per year.  The schools paid $7500 along with $7500 from the Youth Activities Levy (YAL) and the balance of the costs came from general revenues.  With the loss of the YAL it looks like this program will have to be discontinued.  They are, however, working with the school district to try and find a permanent source of funding to continue the student program.

The Commission’s goals are divided into project goals and practice goals.  Project goals deal with specific projects they would like to accomplish during the year.  Practice goals deal are based on policies and practices established for operation of the commission and the department.  As resources for the City become more scarce it is important that the relationships between the Parks and Recreation department, the City and the business community be strengthened.  With the wide variety of funding sources out there we need to work together to ensure that long-term funding is stable.

Gave overview of significant budget challenges.  Stated that because they are dependant upon property taxes, which do not come in until November it is necessary that they maintain a significant ending fund balance in order to survive during the first quarter of the Fiscal Year.  Finance has identified the necessary ending fund balance amount as being 1.2 million.

They are implementing the following reductions; changing employee benefit program, eliminating ½ of the community service officer, reducing park patrol, eliminating a park worker and a janitor, contracting with a temp agency for seasonal workers, eliminating the men’s softball program, reduce number of rafting trips, reduce non-native vegetation removal and fuels reduction programs, and reducing capital projects, etc.  Many of the reductions in service are related to the ending of the Youth Activities Levy.

If these reductions were not made budget would be 5.8 million instead of the 5.15 million proposed.  They believe the changes made reflect a sense of responsibility to continue providing quality services while being fiscally responsible.  Stated scenic park construction will be able to come about because the Parks department has been saving and preparing for this for years and because most of it will be funded through SDC funds.  The ice rink rehabilitation is hoped to go forward through a grant they are applying for to the state.

Committee asked if parks maintenance was contingent upon the Youth Activities Levy (YAL) and how can they continue to maintain those grounds without the funding.  Robertson stated the school district contracts with the parks department for that maintenance and the monies are not directly tied to the YAL.  There was a transitional point when the school district was going from the county to the city when it was more directly tied to the YAL.

Committee member Jackson left 9:00 p.m.

Committee asked about the difference between 2008 budgeted figures and the 2008 actual figures.  In November Parks made some adjustments after review of the first quarters budget.  Noticed at that point in time that they had exceeded the end fund balance before the property tax monies had already arrived.  They determined they needed to ratchet back activities and projects in order to increase the ending fund balance for 2008 to be carried over to 2009.  Committee asked if the increase from actual 2008 to proposed 2009 is due to the construction of North Main/Scenic park.  Robertson stated, no, most of those increases are related to labor costs going up.  Materials and services have remained relatively flat.  Fringe benefits remained relatively flat, but the salaries and wages did increase.  Committee asked what percentage they used for the COLA.  Robertson stated that they used four percent.  The commission has not completely settled on that amount yet.  Usually they use whatever CIP is at the end of April to determine the COLA percentage.  They are hoping to do part of the COLA as a straight raise and part used for a HRA-VBA account.  Committee asked what it would save parks if they used the 2.5 % COLA being suggested by they City.  Robertson stated he would need to come back with that information.

Committee asked if parks has recently raised fees.  Robertson stated, yes, they did recently increase facility rental rate fees in order to come close to recovering costs for running the programs and facility usage.  Last year they were recovering approximately 30% of the cost of those buildings, this year they moved up to a 50% recovery rate.  Committee asked about the reduction of non-native vegetation and fuels reduction.  Robertson stated they do two types of fuels reduction.  The first is with their own crew cutting, bundling and burning materials.  The second is done by contracting out to other groups for additional fuels reduction.  They will continue doing this as much as possible but will do less.  They are not happy with this but understand that it is necessary.

Committee asked for confirmation that $200,000 of the $400,000 for capital improvements was coming from grants and where the other $200,000 was coming from.  Robertson stated, yes, they are hoping $200,000 will come from grants and the other $200,000 is carryover from previous fiscal years.

Committee asked if the grounds maintenance contracts for other various groups (hospital, schools, etc) recovered 100% of their costs.  Robertson stated that they do, with the exception of the hospital which covers an employee for three days but he, on average, has been spending 4 days at the hospital.  They have talked to the hospital and they will be re-programming that employee’s time to ensure he is only there for the three days he is paid to be there.

Committee asked if they were up to 50% cost recover for the student program at North Main Park.  Robertson stated they are working with the school district to get to that point in the next few years.  The school has also started paying for use of other facilities.  Parks also is working hard to track down grant monies for the student programs.

Committee asked if there were services in our Parks department that the County could take over.  Robertson stated he doesn’t believe there are.  County is more interested in passing more responsibility to the City.

Committee asked if the increase in participation in recreation activities which equals an increase in revenue is reflected in this budget and if they expect to see continued increases in participation.  Robertson stated they are expecting growth.  However, they did cut several recreation programs, like the men’s softball program, which will limit their revenue growth.

Committee asked about the budget for the golf course.  The Golf Course currently does not bring in enough funds to cover costs to operate.  Increased FTE employees at the Golf course because they heard people are not using the facility because maintenance was not good, so they made an effort to increase the maintenance at the course to attract new or continued users.

Committee asked that in the future Parks provide a table with all the revenue producing activities and their percentage of total cost recovery.  Also asked for a table of how much they are saving with each program cut they have taken in this budget.  Robertson agreed to compile that for the committee.

Committee asked about employees and whether most are at or near the top step on their salary scale.  Robertson stated that at this point in time the majority of staff are at the top step and 28% of their workforce are eligible for retirement.  The majority of their employees are long-term employees and have, unfortunately, been in the same position for 10 or more years due to lack of vertical growth in the parks department.  It takes about 5 years to progress from the first to the last salary step.

Committee had discussion about registration fee cost recovery for all programs.  Committee discussed step increases and the necessity of doing a classification and compensation study in order to not have the steps be so dramatic to the budget bottom line.

Committee asked how our parks department costs compare to other city’s parks departments.  Robertson stated that Ashland has a level of service which is superior to other communities of our size which also means we have a higher level of costs.  We also have a higher standard and level of services and a higher level of tourist use.

PUBLIC INPUT

Rick Landt / gave background about open space plan and the purchase of the land for the North Main/Scenic Park.  Expressed his concerns regarding the design of the lawn space.  Stated he believes the parks maintenance costs will be too high with high water usage and inappropriate use of this site.  Requests budget committee not approve Parks department budget until they prove they have established lower maintenance and water use costs.

DISCUSSION CONT’D

Committee requested Parks department to respond to the public input.  Robertson stated that they did do a rather extensive public process and Mr. Landt did participate in this process.  Size of lawn was determined by process.  A lot of the concerns were handled in the design and public input process but they were unable to completely address all Mr. Landt’s concerns.  One of the Parks Commission’s goals is to improve the conservation of all their resources.

Committee expressed concerns about micromanaging the Parks Department and hoped to focus instead on the issues surrounding the cuts Parks has already made and the process they went through to create this budget.

Committee asked Parks if they are working on water savings standards.  Robertson stated, yes they are and that is also included in the upcoming audit for assistance in maintenance as well as future planning of parks.

Committee asked if there were any changes to the Senior Program.  Robertson stated that they did everything they could to leave the Senior Program budget untouched.

Discussion was had regarding the necessity of putting forth a tentative approval versus waiting to accept the full budget or accepting just the presentation without approving.

Silbiger/Hartzell m/s accept the presentation of the Parks Department budget and find no significant issues in the budget. DISCUSSION: Committee expressed concerns regarding finding no significant issues.  Silbiger was willing to remove ‘find no significant issues in the budget’ from the motion.  Committee had discussions about the possibility of wanting to come back to talk to Parks about salary issues.  Voice Vote on updated motion: 11 yes, 1 no.  Motion passes.

Everson requested that if the committee is going to change processes that they do so at the beginning of the meetings rather than during the presentations.

ADJOURNMENT

This meeting adjourned at 10:00 PM.

Respectfully Submitted,

Diana Shiplet

Executive Secretary