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HomeMy WebLinkAbout2004-01-13 Council minutesDate: January 22, 2004 To: Mayor and City Council From: Marian K. Karr, City Clerk Re: Council Special Work Session, January 13, 2004, 5:50 PM in Emma J. Harvat Hall Council: Bailey, Champion, Elliott, Lehman, O'Donnell, Vanderhoef, Wilburn Staff: Atkins, Helling, Dilkes, Karr, Miklo, Franklin, O'Malley, Mansfield, Herting, Lewis Tapes: 04-04, Side 1 (problem tape*); 04-09, Side 1 (A complete transcription* and materials distributed are available in the City Clerk's Office) JOINT MEETING WITH PLANNING & ZONING COMMISSION (REZONING APPROXIMATELY 119.94 ACRES FROM' INTERIM DEVELOPMENT SINGLE-FAMILY, IDRS, AND INTERIM DEVELOPMENT MULTI-FAMILY, IDRM, TO PLANNED DEVELOPMENT HOUSING OVERLAY - SINGLE FAMILY RESIDENTIAL, OPDH-5, SUBJECT TO CONDITIONS, FOR PROPERTY LOCATED SOUTH OF PEPPERWOOD ADDITION AND EAST OF GILBERT STREET. Sandhill Estates) P & Z Commission present: Bovbjerg, Freerks, Anciaux, Chiat, Koppes, Brooks, Hansen. PCD Director Franklin presented information. Individual Commission and Council Members expressed their views. STAFF ACTION: Tour scheduled for Thursday or Friday; agenda item for January 20 Council meeting. BUDGET OVERVIEW City Manager Atkins presented the FY05-07 budget review. Copies were distributed (and used as overheads): 1. Loss of Financial Aid 2. Budget Issues 3. We Are Fiscally Sound 4. Fund a Project/Program From Reserves 5. Will Project/Program Create Positive Fiscal Consequences? 6. Iowa City - Property Valuations 7. Property Values $. Levies (Budget page 21) 9. Estimated Property Tax Levy ... (Budget page 22) 10. General Fund (Budget page 30) 11. General Fund Year End Cash Value (Budget page 29) 12. Debt Service Fund (Budget page 32) Council Work Session January 13, 2004 Page 2 13. The Fiscal Policy ... (Budget page 34) 14. Earlier Budget Reductions 15. Budget Highlights (two pages) 16. Road Use Tax (Budget page 68) The City Manager reviewed basic budget policy issues that affect operations and the capital plan relative to the three year plan; possible further reductions in aid to Cities (Last fiscal year had population allocation, property replacement, and bank franchise. Two years ago also getting machinery and equipment replacement monies); debt service tax rates; provided a summary of the general debt fund expenditures and revenues; airport financing issues; Parks & Recreation request for money for a Master Plan; Library Board funding implications; Senior Center support; municipal electric issues. Pending issues include cable franchise negotiations; Homeland Security issues; downtown dumpsters; economic development policies (CVB and ICAD funding); joint communications center. Asst. City Manager Helling, Finance Director O'Malley and Budget Analyst Mansfield present for discussion. SCHEDULE The City Manager reviewed the budget schedule as follows: January 15 - Capital Projects (8:30 AM - noon) January 19 - Martin Luther King Holiday January 20 - Work session time TBA; formal at 7:00 PM January 22- Open (1:00- 4:00 PM) January 27 - Open (6:30 - 9:00 PM) February 3 - Set public hearing on budget for February 17 City Manager noted that the Mayor will be gone for the meeting on February 17 and encouraged all seven Council Members be present for the hearing; suggesting that the hearing and budget approval be scheduled for March 2 instead. Majority agreed not to vote on the budget the same evening as the public hearing. Staff will prepare a schedule for further review. Council agreed to meet with Library Board, Parks and Recreation and the Airport. Staff will prepare schedule and report back. HUMAN SERVICES AGENCY FUNDING HEARING The City Manager stated that the joint hearing conducted by United Way would not be done this funding year, and Johnson and Coralville have informed their agencies there is no new money. Iowa City send a similar letter a few months as well. (Wilburn left the table due to a conflict) Majority requested that funding decisions be placed on the pending list, but no committee appointments (for the hearing process) would be made this year. Meeting adjourned 8:50 PM. LOSS OF FINANCIAL AID State Population Allocation - $570,000 Personal Property Replacement - $300,000 Rollback (effect of:) - $800,000 Bank Franchise - $100,000 Machine['y & EquiPment (replacement) - $750,000 Gas & Electric Utilities $ ? (revenue guarantee) Federal Government Aid Package to State $100,000,000 (State kept it) BUDGET ISSUES 05-06-07 1. General Fund Cash Reserves 2. 1% General Fund Contingency 3. 25% Debt/Levy Policy 4. Loss of State Financial Aid 5. Declining' Residential Rollback 6. Loss of 16 Jobs- General Fund 7. OPerating Expenses- Health insurance, property insurance, employee pensions 8. Maintain Aaa Credit Rating- General Obligation Debt 9. Maintain A1 Credit Rating- Water Revenue '10. Airport Subsidy/Operations - Council decision to be made 11. Library - Cash contribution to debt 12. Capital Projects - Pay off of debt/initiate new 13. Parks and Recreation Master Plan 14. Municipal Electric Studies - no policy 15. Water Rate Reduction WE ~ FISCALLY ~)UND · Property tax based fiscal policy · We "live" on growth (new construction) · Our economic development policies are tied .to property tax · Problem -taking new "expense" side initiatives can threaten our fiscal policies FUND A PROJECT/PROGRAM FROM RESERVES (WORKING CAPITAL) 1. Short Term Impact e.g. Road 2. Long Term Impact e.g. 4th Fire Station 1. Economic Development; grow the tax base; paid for over specific time 2. Continuing commitment from our weakest finance source (operating levies) with greatest competition; commitment of reduction in reserves; reduce credit rating, increase cost of borrowing for other projects. Take on an expense we can't afford. WiLL pROJECT/PROGRAM CREATE POSITIVE FISCAL CONSEQUENCES? 1. What is the nature of the project? Road 2. Will additional borrowing (GO Debt) cause us to exceed 25% debt levy policy? Shows lack of fiscal discipline. 3. Will borrowing jeopardize our credit rating? Allowable growth. E.g. Mormon Trek Extended · 'Improved transportation network · Creates development opportunity · Grows the tax base (property) · Creates jobs CUT OTHER PROGRAMS/TRADE OFFS · A matter of priority · Creates voids in customary services · Is there an alternative service, either public or private? I~ only - (32,579,870) ~ State roiled back C, omnmrclal end Railroads to 99.257% fo~ this yelar, Other UUtlttae and Ilxlusbtal are et I~ for debt ordy ( 13,1fi6,3~).~.~ [Taxable A~se~led Value - Regular Levle~ 11,132,621,3tl I **Commerctad, IndUS#tad and Utlates am et 100% for this year. 100% Assessment $1,666,069,820 $920,524,696 $2,588,604,716 State rollback 0.546525 . - (762,723,829 L.ess: Exemptions (3,66~,050) (3,666,050 L.ess Gas &Electrtc (45,404r600} taxable Asaeaxed Value - for Debt Levy $914,976,054 $910,892,836 $ (49,270,550} L.ess TIF Increment - available for debt only (11,604,365) (11,604,365) Taxable Allesesd Value - Regular Levies $1,764,995,976 ,~t,~,~ rolled back I~atlroads and Commercial to .9~7732; other Utilities and Indusbtal are at 100%, -20 - ~ VALIJF.~ - I~udes New Construction (p. 20) ~ $3.194 Up 7.9% 04 $2.960 Residential 05 $2.155 Up 8.6% O4 '$1.985 Comm. Ind. 05 $1.039 Up6.7% 04 $ 974 05 Tax Base is 67% Residential " 33% Commercial Industrial STATE REGULATIONS APPLIED - Rollback; Gas, Elec., etc. 05 $2.027 Up 4.2% 04 $1.945 Residential 05 1.044 Up 2.3% 04 1.020 Comm. Ind. 05 1;032 Up 5.9% 04 974 05 Tax Base (revised) is 50% Residential 50% Commercial Industrial General $15,654,233 8.100 $16,158,009 8.100 Transit 1,835,990 0.950 1,895,075 0.950 Tort Liability 470,748 ' 0.244 695,971 0.349 521 ' 0.270 0.21'0 9.564 l Revenue Levies: Emergency 521,808 0.270 538,600 0.270 Benefits 3.1{)2 3.4~7 8ubt. _~_~_!: 3.462 Debt Service 8,892,633 4.570 8,061,878 3.9~6 17.596 17.3~2 % Change f~om 6.56% 4.65% 1.99% -1.~% 6,690 3.004 5,813 3.004 Taxes '-- --' FY2006 r T zw l LEVIES Tax Rate Dollars per $1,050 Dollam per $1,000 Fund Levies: General $16.406,746 8.100 $16,868,223 8.100 Transit 1,924,248 0.950 1,978,372 0.950 Tort Liability 725,624 0.358 756,863 0.363 546,891 0.270 562 0.270 Subtotal: 9,678 9.683 Special Revenue Levies: Emergency 546,891 0.270 562,274 0.270 , Benefits 850,990 3.876 4.181 Subtotal: 4.146 9,066,596 4.395 9,529,097 4.463 18.219 10.617 % Change from 6.69% 4.99% 5.11% 2.18% 6,690 3,004 6,690 3.004 ~ T~eS 37,074,673 -- 38,970,024 --- -21 - Eetlm ired Property TaX Levy on $10~0,000 Residential Vlluetlon (Iowa City portion) City Levy: $ 17.806 City Levy: $ State Rollback: SI.3874% Stltl Rollback: 41.4S68% The C-~ property Lax levy of $8.10 Isused In the General Fund to pay for b~ suGG~ of many 8~rvloos, such as polk:e, fire, librery, perk and recrestion .se~. The levy cannot exceed $8.10 per $1000 ~ tlxal2le assessed ~ per,State lew. The Ubrary tax levy of $.27.was voted in bya majedty of the residents in 1901. The in#la1 levy wes ulod to expand Ubrary sefvk:es and'continues to maintain that level ~ service. The Transit levy of $.g5 Is a "genera" levy for transit purposes- State code requk'es that it he mcailO4ed into trar~'ferred to the Transit Enterprise Fund. BeginnlnGI in FY2003 Transit Op~ moved Ir4o Ihs gen~ The Tort Liabil~ levy has no maximum levy and is hosed on estimated Jruurance premiums and claim losses w~thin the self-thsuranoe reterflino. The retention rate Increased in FY2003 fnxn $80,000 per The Emerger~'y levy of $.27 has been utilized slnca FY2901. The General levy must be at $8.10 Ixsfore ,ds levy can be used, but is otherv~se an unrestricted lev,/. The Eml:doyee Bermfits property tax levy is used for General Fund employer costs of social secofl~y (FIC. A - 7.§§%), Iowa Public Em~oyees Retirement System costs (IPERS - 5.78%), Murdc~4~d ~ and Polos Retirement System of tow-d (MFPRSI-24.92¥o, up from 20.80/0). health insurance, lifo insurafloe, (baldly insurance, worker's compensation insurance premiums aod unemployment compaflsatlon. The Emp~ Benefits Food reflects the use of local EmploTes Benefits P, etirement Food Reserve montes to fund part of the employer share of the Polica/Fire pension contribution. The Debt ~ervloe levy provides fonds for the payment of the principal and interest off general ~ bonds. The levy can also be utilJT_ed to fund the payment of any judgments against the City. The Debt Service levy decreases from $8,892,(~33 in FY2004 to $8,081,878 in FY2005 and is projected to increase Io $9,0~,59~ In FY'2008 and to $9,829,097 in FY2007. Future debt Issues include $4.4 million in germrld ~rpose bonds and $7.4 million in tax Increment fl~ncl~ for ~l.-la ~n FY2004. FY200$ and 200~ bond issues are estimated at'$8.3 and $4.8 million, respectively. - 22 - BI~IIdII~IBIdlM~ 10,471,292 13,160,910 13,~14,S01 12,?84,834 i, wql~y Jldimd 14,359,636 15,660,923 15,1i3,123 1&,412,S~4 Twalioit ~ 1,800,627 1,835,990 1,814,074 1,t34,348 b~d~iry ~ S23,0~3 521,808 S3O,i00 Sdi,l~l ~ ~ 409,134 4~0,~48 6tS,O~I ~28,~4 WiN & ~itl Tax 31,407 8,000 ' 1,000 e,000 8,~ ~lit~ CEedi~s ~12,2~2 ~2,~25 ~2,~25 X2,~ZS briG1 Proper~ ReplnceMn~ 2~1,1~ 0 0 0 Licenses a permits ~05,154 ,100,~05 L01,700 ~0~,200 Building Pe~/~s & Inspec~ions 821,05~ 8~3,4~0 00~,200 9~S,S00 Housing Pe~iC. i lno~ctions 207,266 29q,600 255,300 2SS,)00 CemeCe~ Fees k Charges 67,874 G~,000 65,000 65,000 ~91sC~&Ces Cou~t FLneo k Fees 339,845 289,500 310,000 325,000 335,~ Parking F~ne. , 461~155 ~00,000 700,000 700,000 700,0~ ~es Fez Se~ce. ~,329 5,2?5 5,375 S,2~5 S,2?S Recreation Fees 682,303 896,834 763,709 762,484 ~3,404 8en~o~ C~er Fees 9,255 s~,o00 44,000 44,000 44,000 ~n~veFsL~ r~Fe Con~ac~ 2,~02,624 2,~62,835 2,225,Z00 2,272,~85 2,300,000 ~Lma2 Con,Fo2 Se~ces 22~,72~ 25~,842 202,723 200,2~ 2Z3,590 n~d9 & ~ve~opmen~ Fees 6~,9~o 34,500 48,500 48,500 4I,S00 LLbri~ Se~ce. 547,765 539,448 526,898 538,546 547,239 Fees - Contracted Sea, cee 604 0 0 0 ~in ~nse ~hargeback 1,344,470 1,344,247 1,404,589 1,446,426 1,4?S,ISS Co. CF - S~lor Center Support 100,000 75,000 75,000 75,000 ~ait Fees - 27,263 0 260,000 260,000 2~0,~ Bus Pages ~q0,124 647,300 730,300 730,300 730,3~ ~a~ ~ve~en~s o o S,00o o · ~n~v. Heights TF~otC 2~ 27,309 28,069 29,051 30,068 31,120 Univ. Heights Dispatch 0 42,275 42,275 42,275 42,275 G~S / Slec. Use T~ 387,773 422,696 434,112 441,062 447,926 S~a~e ~pula~/on AllocaClon 571,581 0 0 0 · B~ Fr~ch/se T~ 184,348 95,000 0 0 O~her S~ate Gr~s 144,293 101,500 SS,000 SS,000 SS,O~ Ho~el/~cel T~ 563,484 550,000 SS0,000 550,000 SSO,O~ bLbra~ ~en Access 49,920 34,000 34,000 34,000 ~4,~ Federal Or~ks 4,400 0 0 0 Federal ~8tt Assist. 405,540 449,061 402,180 402,180 402,1~ Stake Tr~8Lt Assist. 287,405 315,.938 270,128 270,128 270,12~ Interest Income 376,286 375,000 250,000 , 225,000 200,0~,~ Miscellaneous Revenue 370,708 297,452 301,710 301,510 Sale. of ~d 86,651 300,000 300,000 300,000 ~00,~ bean Re~a~en~s 100,000 100,000 100,000 0 city Atto~ey Chargeback 103,793 73,125 75,000 75,000 75, Transfer from Road Use Tax 2,852,809 3,055,057 3,429,867 3,39b,747 3,489,~9'7 Transfer: Employee Benefits 5,758,052 6,555,397 7,424,619 8,184,584 8,73],4~1 Transfer:Emergency be~ 523,074 534,094 551,0~1 559,549 575,~22 Transfer from Parking ~d 200,000 22~,200 200,000 200,000 29e,GO'~ ~ansfer from Breaded ~nd '82,074 153,784 152,823 153,000 Miscellaneous Transfer 589,731 1,535 0 0 Transfer f~ Parkland Acq 0 100,000 100,000 100,000 G.O. Bonds for Capital Outlay 1,117,838 500,000 0 281,000 Total Receipts 40,248,152 40,165,550 41,787,872 43,108,617 44,~29,65~ Perso~el 26,828,512 28,575,706 29,769,162 31,%47,210 Commodities 1,540,499 1,726,242 1,774,9Z9 1,808,1~8 1,~44,37~ se~ices ~d Charges 6,962,999 7,823,498 7,766,903 8,043,160 ~,0~7,~%~ Capital Outlay 1,383,759 1,515,138 1,214,766 1,038,134 Transfers .842,765 834,146 828,592 857,936 Continge~cy 0 87,224 4~4,000 428,000 441,~ Total E~en4i~ures .37,558,534 40,561,954 ~ 43,622,62B ~ ~4~n~ Bmlmn~ 13,160,910 12,764,.506 12,784,0~6 12,270,015 11,001,32~ -30- Im 01~ Ol~m:l ml~li~ld Ouk:lll~l ~ltwO In FYgO to maintain cash beJ~no~ III Ivl-ylm' Imllll d ~0% d mlllntlllqll. IlUl mi Illl II~n IS%. That policy e~sures thai el~lng emit RecelpCs 40,248,152 40,165,550 41,782,872 43,108,617 .44,029,672 F_x~tiures -37,558,534 40,581,954 -41,763,352 43,617,528 · 46,293,157 EndlngBalance $ 1311601910 $ 12~764r506 $ 12~7841026 $ 12~275r115 $ 11.011,630 Balance as a % of 35.0% 31.5% 30.6% 28.1% 24.:~I~ The Operating Cash Fund Balance is used to provide for cash flow in the first quarter year because the majority of prope¢~ taxes are no( received until ~ and cash balances are draw~ down. The following chart shows cash flow needs or how ~ have exceeded receipts in the first three mo~ths for the past five 3 Months O Receipts Expenditures Shortfall in Sept. 30 Receipts ., FY04 4,593,134 11,065,912 (6,472,778) FY03 4,806,797 9,410,440 (4,603,643) FY02 4,387,107 8,818,510 (4,431,403) FY01 4,449,250 9,233,286 4,784,036) FY00 4,321,697 8,730,848 (4,409,151) - 29 - I1. This fund ixovtdes for payment of the principal .and Interest due on general obllgatien dMX ~ the C~. The P~bt Se~k~e Properly Tax levy ~nd In~'tsfers from P~king, WestewlMr, Ind Entarpdse funds, and the 64-1a Tax Increment fund. Deb~ Service Issua~ In FY2006 Ir~ million in ~merel purpose bonds and $7.4 mlfllon In TIF financing for 64-1a. FY2006 ~nd issues are estimated a~ $4.8 enc~ $4.5 million, respectively. Allowable Debt Margin OutitlMIIng DM~ iii % of Fllcal Total Property (5% of Total Property DMX A#owable Year VMuatlon Val.) .t Jul~ 1 DM~ Margin FY98 2,t85,t~,884 109,258,344 31,39000~ FYi9 2,371,39~259 1t8,5~9,7~3 41,~75,00~ FY00 20416,782,~89 120,839,135 4~,1~5,00~ FY01 2,591,03~038 129,551,502 41,190,000 FY02. 2,692,448,464 134,~22,423 $1,5~5,0~ 48% FY0$ , 2,909,644,383 145,482,219 ~0,000 FY04 2,962,505,107 148,125~55 91,355.000 · FY05 , $,051,380,2~0 152,5~9,0t$ 89~195,0~0 · FY06 3,104,779,415 155~/38,971 89,435,~0 °FY07 3,159,113,055 157,955,653 87,5~0,000 · E.tlmate As stated In the City's Fiscal Policy, "Debt incurred as a general obligation of the Cay of Iowa City shall no~ exceed statuto~ limits: presently 5% of the to~al assessed value of ~ within the corporate limits as established by the City Assessor." The following schedule and graph show current and estimated future debt margins for the C~. Total prope¢o/valuetlen amounls are aclual property valuations fo~ FYg~ -F'Y2004, but are asUmatas for FY2005 through FY2007. document wtfi bdng It~ ~vy .,b~v the 25% margin in FY2005, FY2006, nnd FY2007. The following ctm~ ahow~ I~ debt ketvtce levy oa~ a percentage of the city levy f(x F'V97 h*tmO~ FY2007. The ~ for FY97-FY04 are ceitlfled; the levies for FY2005-FY2007 are p~. Debt Service Levy As a Percentage of Total Property Tax Levy ~ .(25% Recommended Maximum) 25% ~--~ ' ' , I /" 14% 10'/. ~ ' E~tima~ed EARLIER BUDGET REDUCTIONS ~ SUMMARY * Done * Eliminate one Associate Planner $40,000 * Reduce ICAD from $50,000 to $45,000 5,000 * Reduce Library Printing and Postage 15,000 * Reduce Library Materials 15,000 * Eliminate one FTE at Library 45,000 * Increase Library Fines and Fees 15,000 * Eliminate Library Parking and Reimbursement 10,000 Reduce Police by 5 positions or equivalent 250,000 Eliminate 2 FTE Parks/Rec positions 80,000 * Reduce Community Events by 10% 3,000 Eliminate 2 ½ FTE Public Works positions 130,000 * Reduce Aid to Agencies by 5% 16,000 * Increase Fees - Fully Fund Housing Inspection 90,000 * Reduce Education and Training 75,000 * Reduce Hotel Tax to CVB - to General Fund 16,000 * Increase CATV Revenues to General Fund 70,000 Eliminate 2 ½ FTE Finance and Administration 130,000 * Charge Housing Authority for Hsg. Admin. Fees 10,000 * Increase Fees - Building Inspection 70,000 * Eliminate Saturday Night Concerts 8,000 * Reduce Parkland Acq. Fund-to General Fund 100,000 * Increase Parking Violations $5 to $10 250,000 Reduce Fire by 4 Positions 184,000 Library Commercial Rentals to General Fund 50,000 Good Bids, Mild Weather .50,000 $1,727,000 ~ ~' BUDGET HIGHLIGHTS (p. 13-18) 1. Complement of Police Officers (75 to 72) 2. Police- Portable Alarm System - $4,200 3. Permit Plan Pouches - $2,500 4. Senior Center Fees- Revenue Shortfall 5. Senior Center/County- Need for Multi-Year Agreement 6. Recycling Coordinator- $50,000 7. Landfill/Compost Equipment- $80,000 8. Parks Master Plan - $80,000 - Not Funded 9. Municipal Electric- Not Funded 10. Language Line - Expanding Service 11. Cable TV Franchise Negotiations - $30,000 12. Homeland Security - $100,000 13. Loss of General Fund Positions - 16 Jobs 14. Loss of State Financial Assistance- $900,000 15. Continued Increase in Health Insurance Costs 16. Growing Costs to Provide Employee Pensions (Pensions are State programs financed locally) 17. Water Rate Reduction FUTURE ISSUES 18. Speculative Industrial Building - $1,000,000 19. New Recreational Area - Sand Pit off Sand Road 20. Downtown Alleys 21. Economic Development- How to Finance 22. Joint Emergency Communication Center ~ B~II~T ~Ult ~'I'OS - i~07 ~ ~ 2,2~, 2~ ), 213, ~03 3,958,4~8 3,374,294 ~ b Y~ 5,144,34& 5,021,590 S,30i,T30 5,271,X~0 b~l~e ~ ~e8 1,067 1,218 1,067 1,067 1,067 ~ferl 4,124,754 4,275,477 S,791,867 4,259,547 4,464,197 To~ ~u=oB 4,125,821 ~ ~ 4,260,614 ~ BladLng Banshee 3,213,603 3,958,4~8 3,374,294 4,384,790 5,253,016 Trafffc Engineering 1,049,839 Streets Mafntenance 2,314,998 FY99 Pavement Marking 60,000 Inter City Trails 30,000 Curb Ram~8 - A.D.A. 100,000 C3~ek Drainage/Maint 25,000 camp CardLnal Road 1,000,000 Brick Reconstruction 20,000 Dub/Foster Rd Intersect. 400,000 Asphalt resurf/Chip Seal 250,000 Annual Bridge Maintenance 60,000 Overwidth Paving 30,000 P.C.C. Maintenance 100,000 Railroad Crossfng Improvemnt 25,000 Sump Pump Discharge Tfle8 25,000 Traffic Calming 30,000 Traffic Signals 70,000 Forestry-Parkway Mtce. 57,530 PIN Prog. RUT Projects 7,500 Transfer-JCCOG Trans 137,009