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HomeMy WebLinkAboutMin - City Council - 1987 - 06/30 - WorkshopALLEN CITY COUNCIL CALLED - SPECIAL WORKSHOP SESSION IFli�lia�:P�4•I:il Present: Donald P. Rodenbaugh, Mayor Council Members: Joe Farmer, Mayor Pro Tem Jerry Wilson Bobby Glass Jim Wolfe Jim Pendleton Jack Pennington City Staff: Jon McCarty, City Manager Marty Hendrix, City Secretary Charlotte Smith, Finance Director Bill Petty, Director of Community Development Richard Carroll, Chief of Police Ernie Hoback, Director of Public Works Tom Glab, City Engineer Ron Gentry, Fire Chief The called - special workshop session of the Allen City Council was called to order by Mayor Rodenbaugh at 7:09 p.m. on Tuesday, June 30, 1987, in the Council Chambers of the Allen Municipal Annex, One Butler Circle, Allen, Texas. Budget Workshop (Agenda Item II) City Manager Jon McCarty spoke before the Council on a brief overview of the 1987 - 88 Budget process and the items to be presented at this meeting. Mr. McCarty reviewed the budget calendar dates for the city staff and then reviewed the budget calendar dates for the City Council. Using the budget packet distributed to the Council, Mr. McCarty presented and reviewed the General Fund - Assessed Value Comparison and pointed out that the city is still exper- iencing growth but at a much lower rate than in previous years. Mr. McCarty then reviewed the calculation of the effective tax rate using the formula provided by state law. He explained to the Council the 3 percentage factor of raising the tax rate and the fact that if the tax rate is higher than the 38 then that triggers the public hearing notices and the public hearing on the tax rate. Mr. McCarty also explained to the Council that if the tax rate is raised higher than 88 then the city is open to the possibility of a roll back election that can be initiated by Allen citizens. Mr. McCarty advised the Council that the effective tax rate shown on page 5 represented no bond sales in 1987 and the effective tax rate shown on page 6 did represent the rate if bonds are sold. The Council discussed with city staff the 88 factor and what the resulting tax rate could be and what the tax rate would be at the 38 factor. 11 ALLEN CITY COUNCIL CALLED - SPECIAL WORKSHOP SESSION JUNE 30, 1987 Page 2 Revenues & Expenditures (AGenda Item II -A) Mr. McCarty reviewed the General Fund - Revenue Estimates for 1986 - 87 Revised Budget and the 1987 - 1988 Estimated Budget. He then reviewed the General Fund - Projected Expenditures for 1987 - 88 by department, the comparison of the 1986 - 87 Estimated Budget, the new programs projected in the budget, and the General Fund - Revenue and Expenditure Comparison. Mr. McCarty explained to the Council that the figures did not include setting aside monies for salary increases or monies for reserve funds. Mr. McCarty then reviewed the Water and Sewer Fund - Revenue Estimates, the Water and Sewer Fund - Projected Expenditures for 1987 - 88, the Water and Sewer Fund - Comparison of 1986 - B7 Estimated Budget, the Water and Sewer Fund - New Programs Pro- jected Budget, and the Water and Sewer Fund - Revenue and Expense Comparisons. Mr. McCarty advised that the figures did not include any funds for salary increases. Mr. McCarty reviewed the policy for reserve funds in the water and sewer fund and that the coverage was suppose to be 1.40 times the average annual principal and interest debt requirements. Mr. McCarty pointed out that the coverage factor in the water and sewer fund was different than the reserve funds in the general fund. City Manager McCarty continued his budget presentation with a review of the Fund Balance Policy Statements that had been adopted by the City Council. Capital Improvement Program (Agenda Item II -B) City Manager McCarty then reviewed the Capital Improvement Program - Bond Program Summary By Year - Alternate A. He pointed out the projects that have been funded to date and those that have not been funded. In further review,. Mr. McCarty explained what projects the department heads had requested to be built, the amount of bonds that need to be sold in order to accomplish those projects, and the remaining amount to be sold in the last two years of the bond program. Mr. McCarty then reviewed the Capital Improvement Program - Bond Program Summary By Year - Alternate B and explained that the proposal to sell bonds for 1987 would be to fund only the library and parks projects in the amount of $2.5 million. Mr. McCarty then reviewed the funds that are still available to do street projects and listed the street projects to be accomplished. Mr. McCarty advised that the $2.5 million would be used to construct the new library building, development for the recreation center and some neighborhood park sites. Mr. McCarty then advised of the bond monies that had been moved for 1987 to 1988 and that had included monies for the Fire Department, the Street Department, and the Parks Department. Those capital projects included the aerial ladder, construction of the recreation center and park land acquisition, and the asphalt overlay program, storm drain repair, subcontractor overlay, Main Street East, the street sweeper, and the reimbursement on the Bethany Road Bridge. In discussion on these items, it was pointed out that the funds for Main Street East would be for construction. ,sA ALLEN CITY COUNCIL CALLED - SPECIAL WORKSHOP SESSION JUNE 30, 1987 Page 3 Budget Issues (Agenda Item II -C) City Manager McCarty then reviewed the 1987 - 88 Budget - Key Issues as follows: A. B. C. D. E. F. G. H. I. J. K. L. Policy Statement on General Fund Reserves Salary Contingency (Existing Personnel & Salary Program) 88 Tax Increase Limit Cut Programs Budget for Economic Development Computerization TMRS Updates Paramedic Service User Fees (Including Water and Sewer Rates) Self Insurance Volunteerism Postponing Costs: Personnel Capital Costs Debt Service Mr. McCarty discussed with the City Council what other cities are doing to achieve their needed budget cuts and explained in detail what items "A" through "D" represented. Mayor Rodenbaugh recessed the called - special workshop session of the Allen City Council at 8:02 p.m. The meeting reconvened at 8:13 p.m. At this time, Mr. McCarty distributed to the City Council copies of the Budget Reduction Action List that had been prepared by the city staff prior to the budget preparation. Mr. McCarty reviewed this list with the Council and pointed out suggested programs and services to be cut from the budget, new ways to accomplish jobs that the city is presently doing, the use of interdepartmental cooperation, and ways of creating new revenues. Mr. McCarty went on to explain the items "E" through "H", and items "I" through "L". Mr. McCarty pointed out that the items listed under "L" were costs that could be postponed if sufficient revenues were not made to cover current expenditures. Those items were to delay hiring of personnel to fill approved positions, delay the purchasing of capital equipment items, and using additional reserves to apply to the city's debt service. In conclusion, Mr. McCarty added that areas of concern in this year's budget were limiting new programs, if there are going to be any salary increases and just how much, con- sideration of eliminating the merit pay plan, and giving some thought to the fact that if there has to be a decision on salaries or merit, the employees may prefer to receive the salary increases rather than the merit pay. There was discussion by the City Council with city staff on the expanding of fees collected in various areas and that the suggested fees for utility inspections may be more harmful than useful. There was also discussion on what the State Legis- lature was going to do regarding the state's tax base and how it will effect local government, what the volunteerism plan entailed and perhaps using local organizations to do weed inspections, inspections for junk vehicles, etc. It was concluded that law enforcement types of inspections could probably not be conducted by volunteers or civic organizations. There was further discussion by the Council with city staff on the refinancing of the existing bond indebtedness for "old bond debts" and city staff advised the Council that this issue had been addressed in the past and the city was not able to do this with the old bond ordinances. T ALLEN CITY COUNCIL CALLED - SPECIAL WORKSHOP SESSION JUNE 30, 1987 Page 4 Budget Issues (cont'd) (Agenda Item II -C) The City Council discussed with city staff some additional information that they would like to see in any upcoming budget presentations. That information included a different way of showing the capital improvement program projects and funding shown in the "Alternate A" and "Alternate B" formats to a more simplified format, to show a listing of the bond monies in hand and the projects to be funded with those monies, and to include the realistic strategies that the City Council would be dealing with in written form, with specifics or options available to them. Mayor Pro Tem Farmer also advised the city staff that research should be made into the number of bills that were passed by the State Legislature regarding taxes and collection of taxes to make sure the City Council is brought up-to-date on that information and the city can meet the compliance required by them. The Council then discussed with city staff if the Council decided not to sell bonds this year, what would happen to the grant money that the city had received for this project, what kind of penalty or penalties would be placed on the city, would they have to return all of the monies, how much of the grant funds had been expended to date, and what is the con- sidered timeframe for selling the bonds. City Manager McCarty advised the Council that a determination would have to be made in August of 1987 as to whether to sell bonds this year. He pointed out that the other questions posed by the Council regarding the grant funds for the library would have to be researched. The Council discussed with city staff the amount of bond v funds available for water and sewer projects and what the projects were at this time,and if the city would be selling any additional water and sewer bonds this year. There was further discussion by the City Council with city staff on the whether the 88 was a ceiling, an absolute ceiling, or if there may be a need to go above the 88 in order to meet the needs referenced in the policy statements made by the Council. There was discussion on the possibility of a rollback tax election, how it could effect the city, and what was the interpretation of the rollback tax law. The Council continued discussion on the water and sewer fund and what the coverage factor was for this fund and how the calculation is determined and if there would be sufficient funds to meet that coverage this year. There was also discussion on the audit of the water and sewer funds and the city's annual audit and when it could be expected to be completed. The Council discussed with city staff if a water and sewer rate increase would be needed and at what time that determination will be made. City staff advised that it would be after the audit process. The Council also discussed the city's collection of sales taxes, what the percentage of increase had been over this year in comparison with last year and what was expected for next year. Items of Interest (Agenda Item III) There were no items of interest to discuss by the Council at this time. This agenda item was passed over by the Council. ,. ALLEN CITY COUNCIL CALLED - SPECIAL WORKSHOP SESSION JUNE 30, 1987 Page 5 Adjournment MOTION: Upon a motion made by Mayor Pro Tem Farmer and seconded by Councilman Wolfe, the Council voted 7 - 0 to adjourn the called - special workshop session of the Allen City Council at 9:24 p.m. on Tuesday, June 30, 1987. The motion carried. These minutes approved on the 16th day of JULY 1987. APPROVED: ATTEST: Marty Hendrix, NMC, CITY SECRETARY ,u,