Budget Hearing May 28, 2014
Budget Hearing May 28, 2014
The Enterprise City Council and Budget Committee met in Special Session on Wednesday, May 28, 2014 at 6:30 p.m. Those present were Mayor Margie Shaw; Councilors Jenni Word, Stacey Karvoski, Laura Miller, Larry Christman; Budget Committee John Lawrence, Marc Stauffer, Gail Tally, Kim Stoffel, Jodi Berry, Kurt Melville; Staff City Admin. Recorder Michele Young, Public Works Director Ronnie Neil, Chief of Police Wes Kilgore, Librarian Denine Rautenstrauch; Fire Chief Paul Karvoski.
No public attended
Mayor Shaw opened the Meeting at 6:34 p.m.
Mayor Shaw asked for nominations for the position of Chairperson from the Budget Committee. Marc Stauffer nominated Kurt Melville as Chairman, John Lawrence seconded the motion, motion passed unanimously.
Chairman Melville opened the meeting and asked Budget Office Michele Young to present her Budget Message.
Michele explained that everyone should have their budget in front of them. One of the things she did was put together a series of motions that the committee can consider this evening. This was created to help move things along but in no way is being done to influence how motions are made, this is just for wording purposes. Michele stated that first on the agenda is a time for public Comment. Chairman Melville called for public comment, there was none in attendance.
Chairman Melville stated that the Budget Officer held a Public Hearing on May 12, 2014 at 2:00 p.m. by the Budget Officer Michele Young. No one from the public attended. This public hearing is an opportunity for any member of the public to comment or make requests regarding how State Revenue Sharing Funds will be spent in the 2014-15 Fiscal Year beginning July 1, 2014. State Revenue Sharing funds are a share of certain revenues of the State of Oregon that shall be apportioned among and distributed to the cities of this state for general purposes. Chairman Michele informed the Council and Budget Committee that she had published the Public Hearing notice in the Chieftain for tonight’s meeting at the City Hall. However, she had made a mistake and put the incorrect day in the paper, the date was correct. Michele stated that she contacted the Department of Revenue and they said because she had good faith intentions, and because the date was correct they felt there wasn't any problem. Michele stated that she posted a correction notice on May 14, 2014 at City Hall, the Library, WardePark public notice board, KWVR, and the website as of last Wednesday. The press was notified by email.
Chairman Melville called for introductions.
Michele stated that all funds were balanced except for the General Fund. Michele stated the General Fund was faced with a $60,000 deficit and all departments were asked to make cuts. The Police Department had the largest cut to make since they have the largest budget, Chief Kilgore will make a presentation tonight regarding his budget.
As in previous years the only increases in line items have been in fixed costs: heating and electricity. The Wastewater Treatment Plant has increased about $15,000 in electric cost.
Committee Member John Lawrence asked about the solar panels; Ronnie stated they were only saving about $200 a month. Michele clarified by saying the city does not own the panels so most of the revenues goes to the owner.
Michele stated the overall budget is status quo except for the Water Fund. The Sewer Fund was fine until the rate adjustments were made a few years ago, that put the fund in a deficit. The council made one rate adjustment last year and Michele proposed they look at an actual rate increase policy. We are trying to get the Wastewater Department out of the hole, which should happen once we bill out, currently they are about $70,000 short. In the current fiscal year the City has received 786,000 dollars in grants. Departments are active in attempting to obtain grant money to help with the budget constraints. We have received $765,000 for the Water Project, $9,500 for parks and $11,500 for the Historic Landmarks program.
Michele asked how the Budget Committee would like to proceed. They wanted to start with the General Fund.Gail Tally suggested having every department do a discussion regarding their budget.
Ronnie Neil reported on his department. Street Department-Basically there are no increases in the Street Department. This department basic function is for fixing streets, street cleaning, striping, picking up garbage, general street maintenance. The fund balance is down a little from last year because of the SCA grant we received for Depot Street, that project is completed.
John Lawrence asked if the overtime increase is due to plowing snow, Ronnie replied yes.
Michele stated that we are increasing the overtime budget so that we can actually pay it out instead of letting it build up in comp time.
Gail Tally asked if our union contracts require this, Michele stated that we are in negotiations at this time and we are in trying to keep our liability down.
Gail Tally asked if we are managing time so that people will take their comp time to reduce liability, Michele stated that 60 hours is what we are trying to limit their accrual
Wes Kilgore handed out a sheet of stats on his department. Wes stated that the Budget Officer does an excellent job and keeping the City’s budget balanced and he respects her for that but asked the committee to not reduce the police budget. We have always had a 4 man Police Department. Every mandated seminar that he attends, it is stressed that we are in the most violent times in history. The first show’s that they have responded to 1593 calls in 2013. The second page is for rural Enterprise, backup calls for County. What those stats do not include is most of the walk-in complaints at the front counter, the in house telephone complaints, officer contacts, officer back up calls, and any assist in special duties (Bowlby Bash-Hit when the Police Department was down on manpower. Mayor Shaw asked if the Police Dept. can have a man directing traffic, which we did not have available last year during Bowlby Bash. Wes replied that this leads to overtime of one officer. We are constantly trying to get more events in Enterprise, such as the motorcycle rally, the Outlaw group will show up in town and we will have to deal with that. In addition to the stats is the deal from Tim Peck, the EMS Director for the Hospital and how much they appreciate the Medical assists we prove. Every ambulance call, if it sounds like its important, we have an officer roll to those calls, such as life alert. Life alert is a great thing-If they push the button the correct medical shows up, what they don’t know is that communications cannot be made until an officer clears the house and makes sure it’s safe to enter. He feels the committee has to make a difficult choice: choosing between adequate emergency services or adequate community service.
Councilor Karvoski asked when the last time was the police had to cut. Wes said it was when Kevin McQuead was cut to 3/4 time. Councilor Karvoski asked how much was that. Michele stated that a budget had already been adopted and then Union negotiations were settled leaving the Police Department with a budget shortfall. He had no choice but to make the reduction, it was not a long term thing.
John Lawrence stated that they will not stick around if hours are cut. Michele stated that the cut amounts to $19,500 which would amount to reducing hours for one person to 30 hours per week. Wes stated that he played around with the numbers but it’s not going to be a pretty site. John Lawrence asked Wes if he would have to decide which calls to respond to like other department have. Wes responded "no doubt about it". He would have to make 8 and 10 hour coverage’s. Councilor Karvoski asked if taking someone down to ¾ time would be enough. Michele stated it would make it close, it would make it a three day work week for one person.
Mayor Shaw asked how many reserve officers do we have; Wes stated we have one that’s a solo reserve to cover a shift by himself. When Crowder resigned, he put the Reserve Program on hold. Gail Tally suggested that we could find some of that in the budget such as Unemployment, if you cut someone you will have to pay unemployment, if you keep them on you could eliminate some of the unemployment in the budget, this amounts to $10,000.00.
John Lawrence asked what we have done in previous years with unemployment, Michele stated we are direct pay so it has always been budgeted.
Councilor Karvoski asked where the $5000 went from the municipal court, Michele stated it just went in the budget in the first attempt of making adjustments.
Gail Tally asked about the Fuel budget. You used about ½ the fuel budget in 10 months. Is there anticipation for the remainder in this year? Wes stated the reason the fuel costs went up was because of the spike from last year, the costs have not gone down.
John Lawrence stated we could pick up a thousand from the Justice Center since there is no increase this year.
Michele stated that regarding the unemployment thing, she liked that idea, but what would have to happen if someone did leave the city and qualify, we would have to hold off on trying to hire a replacement until the budget caught up.
Gail Tally stated given the history it hasn’t happened for a couple years, leave something in for a place holder.
Councilor Karvoski stated that Schools and training has a lot of money budgeted, Wes stated this is for mandated training.
Gail Tally commented that they have already used 80% of it.
Michele commented, one of the other issues we have is liability insurance, it has gone up in all departments increasing by 27%. There is no cutting in that area.
Councilor Miller asked why the health benefits reduced, Michele stated it is because of the reduction in what is paid in the employee HSA accounts and changes in employee classification.
John Lawrence asked if Michele’s projections for next year are less than last year.
Michele stated that we have an employee that does not have family coverage and that employee replaced one that did so it reduces the premium to the city.
Councilor Miller asked if it will it be adjusted in negotiations, Michele stated that negotiations have just begun and no agreement has been met.
Gail Tally asked if anything could be cut in line #22, K-9. Mayor Shaw said we can’t cut #22.
Michele stated that most of that is grant funded.Gail Tally asked if there is any movement in #22, Michele stated that she did not know, she would have to look at that.
John Lawrence recommended we look into the bigger things; Unemployment, etc. Leave it up to the Chief to make the little cuts needed. For cuts, the Police Dept. is $19,000 which is a good chunk. Was there the same with the other general fund departments?
Michele stated that each department took a cut, it was based on the percentage of their department of the whole General Fund. Michele stated that her department took a cut of $10,000, Fire was $5,500, and the Library was $3,500. The library has so little area to cut that Michele helped them out by cutting the conference budget in her department. There will be a lot of time in the water project for labor which relieved some in parks and streets.
Gail Tally asked if we could take unemployment from those other funds.
Michele stated Yes but she is not comfortable doing that because there are past employees eligible to draw city unemployment.
Denine stated we could cut the unemployment in the Library. Michele stated all the employees over at the Library do qualify. Out budgets are so tight and the liability is there and she doesn’t want to take those chances.
Ronnie stated he could cut from schools and training. In the Parks Department he would be willing to eliminate the janitorial service. Two years ago he took a cut of part time lawn mower and Michele lost a ¾ employee. Mowing the parks has turned into full time job for one of his employees, we are down to four when he is working on the parks.
Councilor Karvoski felt Ronnie has taken enough cuts the past couple of years and John Lawrence agreed it would take his employees away from their regular duties.
Mayor Shaw asked if we pay them minimum wage, Michele responded that it is by contract.
Marc Stauffer asked about the increase in range supplies, Wes replied it was for Ammunition.
Jody Berry asked what the Computer Software line item was about, Wes stated it for a Records Management system they share with the Sheriff’s office.
Jodi Berry asked if Wes could talk a little more about the K-9 program. Wes stated that our previous K-9 dog Verena was diagnosed with a hip problem. They were gearing up to send George Kohlhepp to training and Verena ended up with a torn meniscus. The vet said that she would no longer be a sound working dog. Wes stated that they decided that it would be better to cut their losses and get another K-9. George contacted other agencies and there is now $10,000 pledged for another K-9 and schooling.
Gail Tally asked what does a K-9 cost, Wes stated that it is about $10,000 for the dog and the training. This K-9 will just be used for drugs.
Michele stated that the only other thing we have not brought up that could be another option is the funds for another vehicle. Councilor Karvoski asked about supplies and materials and Marc Stauffer asked if Wes can squeeze the rest out of the budget? Wes: $5000?
Councilor Karvoski asked If we anticipate using all of the $3000 for negotiations. Michele stated that she did not know where we are going with that, negotiations are going fast this year because we are using LGPI but we are not done and anything can change.
Wes stated that if that falls through, he can come up with $5,000.
John Lawrence stated that it is pretty reasonable if Wes has to come up with the $5,000. We are not making any department make any more cuts than what has to be made.
Chairman Melville asked that Michele make a note of these changes for the final approval, Michele stated she already had.
Ronnie stated that basically there is little change in the airport budget. Line repair is the same. Runway is snow removal and striping. Utilities are runway lights.
Mayor Shaw asked if there are grants available. Michele stated yes, the Department of Aviation has a small city grant. The City has been putting away money to help come up with the matching funds. Two years ago we had a runway improvement project and the City had to have a 7% match. Last week I got a bill for the 2012 project. It comes out of our capital improvement fund.
Denine stated that she worked with Michele on her budget. She was hoping that just as all the other departments, they would have increases somewhere. But all have held pretty much the same. With the request of the 11% budget cut, she took it to Michele and told her that she needed help offsetting because frankly, her material budget is as cut as it can be. With Michele’s help she did meet the request.
Gail Tally asked if Denine would talk about the building maintenance and supplies.
Denine stated it is for routine building maintenance costs, they just painted around the stair area and basement.
Gail Tally asked about Capital Improvements. Denine stated we are at the final leg of a 10 year improvement plan. Denine stated the money we have budgeted is part of our match for future grants on this project.
Fire: Paul stated that he also worked with Michele on making cuts. In his department Line item 16, 18, and 20 was reduced by $5,500. It is a hit but we will survive. If you look on line item 13 the fuel cost is horrendous. There is not an easy fix for it, so that is hurting us. There is a Federal Grant to replace a truck. Services will still be there. We have a 23 member department and everyone seems dedicated.
Chairman Melville asked for clarification on "Mutual Aid". Paul stated there is a City to City handshake that represents if a fire occurs in a City, the City requesting mutual aid will not bill. If it is outside the City limits they will bill. We are doing well with that.
Mayor Shaw asked how much money have we put into the roof and repairs on this building?
Michele stated they probably ended up putting out a total of $60,000. Wes’ evidence room is not supposed to be used and should be closed off due to the high levels of mold found in that room.
Ronnie Neil stated that Parks is in the General Fund and is mainly maintenance and improvements, we have the main CityPark, WardePark and the baseball fields. There is quite a bit of mowing to be done in the summers and then general maintenance on the irrigation system and fences. Denine has been working on grants for chips in the play area. The last estimate for replacement of the chips is $20,000, we have received $9,500 so far. The last few years the City has been talking about the bricks in WardePark which will be a high expense.
Marc Stauffer asked what the Ratcliff Fund is. Ronnie stated that the city receives funding from the Leland Ratcliff fund, they donate money for repairs and stuff like that. Ronnie stated that we contract all weed spraying now because we don’t have anyone licensed. We contract with the County. The fuel costs are for mowing. The last few years the salaries reflect a large increase in time spent working in parks. They spend a lot of time and effort on the ball fields and parks.
Mayor Shaw asked about the Park Loan. Michele stated this is the last year that we have to pay on the loan, it is for the piece of land across from the park on the other side of Prairie Creek that we purchased.
Michele stated the General Overhead budget is pretty much the same as last year. It covers the Planning Dept., Council Expenses, and office expenses. It involves a lot of different functions that flow through the office. The County GIS is for mapping, it is a valuable program. Michele stated that they cut the League of Oregon Cities conference in Eugene as it is too costly. She has also cut back on schools and training. Michele stated she cut out some things that need to be done at city hall for maintenance. The land acquisition is a new expense but because not all of it will be fire, city hall will be part of the expense. The Capital Improvement transfers are for future City car and also computer replacements.
The Historic Fund transfers to the Historic Preservation Fund. It helps fund the Landmarks Commission with the various grants and programs. The Community Connections budget is used to help fund their transportation program and their meals program. The City increased it from $1,000 to $2,000 last year. The Ordinance Codification is for our ordinance maintenance cost and website link.
Gail Tally asked if this is an annual fee, Michele stated that it is estimated. The cost fluctuates.
Michele stated that she has frozen the budget and has asked all departments not to spend.
Michele stated that she does have a new phone system budgeted. It is for her office, the Fire Department and Public Works as they are all linked. The phone system we have is very old and we have two phones now that have quit, they are not repairable.
Gail Tally stated that the vehicle maintenance costs seems high. Michele stated that it is all an estimate and what is left unspent goes into cash carryover.
Stacey stated that it looks like Liability insurance went down; Michele recognized a mistake in the budget. She will play with the budget to make the correction, Michele thanked Stacey for catching that.
State Tax Street:
Ronnie stated this fund is where the street maintenance work comes from. All paving comes out of line item 4. Last year we spent $111,000 on Depot Street, $50,000 of that was a grant. This Fund is for Equipment operations; basically maintaining the dump trucks and oil changes, services, etc. All Street lights and utilities comes out of this fund. We have $12,000 budgeted for gravel. Right now we only have 300 yards of rock. Hopefully the County will get more in to get crushed. We have new requirements for street signs, they have to be of high reflective materials. We have completed replacing the stop signs, now we have to have the street name signs up to code by 2016. The fund is down from last year. We have plans to chip seal some of the streets, which will be about $12,000. There are also plans to overlay some streets. There will not be as many repairs as have been seen in the past since we spent so much last year on Depot Street.
Laura Miller asked about the Bike Paths budget. Michele stated that we are required to budget a certain amount each year.
Ronnie stated that the bike path line item doesn’t change. Handicap ramps is something we haven’t done anything with. The curb budget of $20,000 does not do a whole lot, but we try to have a little for curb work around town.
Mayor Shaw asked if the curb money could be used to replace the sand on the brick at the park, Ronnie stated he would rather not, as the money needs to be available for curbs.
State Revenue Sharing:
Michele stated that these funds are split between fire and police, it is to be used for equipment replacement. The Police use it for replacement of their police cars and the Fire Department has used it for major equipment replacements such as vehicles, hose replacement, etc.
Michele asked for discussion on this fund. This fund was hit real hard with the closing of the Best Western and the decreased CountyTax check. Michele explained that she thinks we will recover by the end of this year. It takes a whole year to get the money from the County. Michele stated that the Community Advertising line item is for the sign Enterprise Main Street (GEMS) has asked for financial help for. This is the "Welcome to Enterprise" sign they presented a little over a year ago. Because of the cuts, we have not been able to fund that as well as we hoped. The Facade Improvement line item is for the grant program we give to business’s to help them with façade improvements on significant historic building. Michele asked if everyone was okay with how she allocated the money. In order to fund the Welcome sign we will have to reduce the amount of grants we give out, next year it should be better. Michele asked if there was any input on doing this differently
Stacey commented that the amount available in CETRA grants is substantially down
Michele stated all available money was granted out this year. The money being carried forward is for previously granted events.
Marc Stauffer stated that he is extremely glad a commitment was made for the sign, it is badly needed. Mayor Shaw commented that we need to help get that done.
John Lawrence stated that he doesn’t like to see the grants cut but it is less important than police, fire, etc. John also stated that he felt it’s a waste of water to wash the streets every Friday.
Michele stated that when we miss a Friday we hear about it. Ronnie stated that we never heard so many complaints until about 2-3 years ago regarding our street washing.
John Lawrence asked what a Franchise fee is. Michele explained it as a fee for Use of the City’s Public Right Away. We get money from Pacific Power, Garbage, telephone, etc. As far as the Water & Sewer Franchise Fee, part of it is collected through the water bills and the other comes out of the water revenue collected. If agencies did not have right of way to put their lines in or across etc., they would have to buy and maintain property. These fees are very common for cities to receive, it is all about use of the right of way. Michele stated that our auditor questioned the cities policy on this and Michele took to other cities to make sure we were doing it correctly. Michele stated that she received a lot of comments about the cities right to charge water and sewer for use of the public right of way, just like we do other agencies. Water and Sewer are not part of the General Fund and they are to operate as their own entities. The League of Oregon Cities has worked very hard fighting for cities to not lose the right to charge for this. Michele stated that if this board and council want to change this they can. No comments to change anything were made.
Ronnie stated that this fund is for the operation and maintenance of the water system. We have a signed contract with Anderson Perry for the water project which will be designed this year and in the spring we will go out for bids. They will be busy for the next few years getting everything lined up with water, and working with the contractors. He would like to purchase a new pickup for the water department for a service vehicle.
Kurt Melville asked if that is budgeted in equipment replacement. Ronnie stated yes. There is more from the Capital Fund to help fund it as well. Councilor Karvoski asked if we can do that this year, Ronnie replied yes.
Marc Stauffer asked what the Bad Debt line item is for. Michele stated that they budget a percentage we go by. We wrote off the most we ever had this year and it was around $1200. It is a rule of thumb to have it there.
Ronnie stated Supplies and Materials will always be high. It is the cost of Water Meters, Water Meter Setters, etc. The cost of materials are all up. The meter replacement line item should be enough to replace the meters with the touch-read meters. We are behind times as other cities have gone onto other styles like radio reads.
Mayor Shaw asked what the Computer Maintenance Fee was for, Michele stated it is for the software that transfer the data from the meter reader to our accounting system.
Ronnie stated that this is the maintenance and operation of the wastewater treatment plant. The power utilities have increased significantly. Dave Wilkie and Ronnie have talked about a way to bring that cost down, there are a lot of mechanical operations in the plant. They have adjusted everything to the lowest and minimum they can be set at to run. There are heaters in each building in the winter time that are set high enough to keep everything from freezing. It is the same as regular households. There is not a lot that can be done but they are trying to keep it as low as they can. Ronnie was thinking about having some pipe relined that they have had issues with in the past. About 1200 ft. of pipe to reline. Ronnie stated he would like to get the $3500 back in Materials & Supplies, it is for General Maintenance as well as the carpets and rugs. Michele stated that was an oversight and she will get it back in there.
Councilor Karvoski asked what kind of sewer increases is this budget based off of.
Michele stated that she is going to recommend .50 to .75 cents each year and slowly try to bring it up. Councilor Karvoski asked if the budget is based on an increase. Michele stated that she had thrown in a very small increase but it wasn’t really worked out as she has not brought it to the Council yet. Two years ago the Council did a Rate Adjustment which resulted in many commercial users bills being substantially reduced. Michele stated that it’s not a bad thing what was done it is just that it was done backwards. It should have been required when the project was done but we knew it would have a negative impact on our revenues. DEQ made it a requirement that rate structures be evaluated with the project. This year when we went through and evaluated all of the accounts there were two increases and five reductions. It’s going to be a balancing act that will work itself out. We waited too long before we had an increase. This will go to the council for final approval. Michele stated that the Sewer Dept. is on a slim budget and we will have to transfer about $90,000 next year from the Capital Improvement to balance the fund. This is not something we want to keep doing, we had to transfer $50,000 in this current fiscal year.
Michele stated she will be making an adjustment in this one because they ended up with more than was supposed to in a grant she received. Over the next year and a half, we are going to be redoing the Historic Downtown Walking Tour books that were done several years ago. They are going to be updated in color. The other thing is mobile tours. It is becoming more popular. There will be a bar code or something similar, at each historic building where you can have a code, put your phone up to it and receive information about the building. It’s a really good tool for someone with vision problems.
Michele stated that now that we have covered all funds we need to review the changes. We have $14,000 in adjustments to the police department and the chief will figure out the remaining. General overhead: Michele will add $2,000 to insurance and cut something else. The sewer building maintenance will have to wait until we see if the cash carryover will be better. Our union negotiations are not complete so we do not have an approved wage scale for 2014-15. We also discussed that if a change in the Police Dept. personnel occurred, that a replacement would not be hired if we have to pay unemployment since we used that to balance the Police budget.
Chairman Melville stated we need a motion.
Mayor Shaw moved and Marc Stauffer seconded the Motion which passed unanimously to approve the 2014-15 City of Enterprise Budget with the changes noted above.
Chairman Melville asked for a motion to adjourn, Councilor Miller made the motion and Councilor Stauffer seconded the motion which passed unanimously.
Meeting was adjourned at 8:39.
Margie Shaw, Mayor
Michele R. Young, City Admin./Recorder