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08-15-12 Budget Workshop Budget Workshop OCOEE CITY COMMISSION Ocoee Commission Chambers 150 North Lakeshore Drive, Ocoee, FL August 15, 2012 MINUTES 6:00 p.m. I. CALL TO ORDER Mayor Vandergrift called the meeting to order and said we will have a briefing from the City Manager and Finance Director. II. Introduction — City Manager Frank City Manager Frank said that staff has produced a recommended budget for FY 12/13 that is currently balanced at the current year's rate of 5.8460. That represents a $283,000 reduction from last year's revenue in the city. He briefly touched on the important points for the upcoming budget and advised that the roll back rate is 6.1304, so the budget before them is a good number less than that. III. FY12 /13 Budget Overview - Finance Director Horton Finance Director Horton said the proposed budget for the City of Ocoee is $54,641,745 for FY 2013. The budget is comprised of several different funds. General Fund is the largest and only one with property taxes as a revenue source. General fund is the only fund directly impacted by the millage rate. Proposed General Fund revenues are $35,028,865 for FY2013. This is a proposed increase of $925,890 or 2.7% from the current year. Although ad valorem and intergovernmental revenues make up the largest revenue categories, property values within the city decreased by 2.9% or $283,000 from the current year. The other revenue categories show little to no change from the current year. Prior to adoption of the budget by the commission in September, a millage rate has to be adopted. This millage rate is the amount used to calculate taxes on assessed property. The amount of the millage rate determines the type of vote that is necessary to adopt both the millage rate and budget. As shown on the PowerPoint chart, a majority vote is required for a millage of 7.6037 or less. A super majority or unanimous vote is required for a millage over 7.6037 up to the maximum of 10 mils. The proposed budget is balanced at 5.8460 mils - the current year millage. This is lower than the rolled back rate of 6.1304. Last month the Commission set the proposed tentative millage rate at 6.2500 which allows for room to add items to the proposed budget without incurring additional mailing costs. There are four main categories for the expenditure budgets for each fund. Personnel, Operating, Capital and Transfers Out. Personnel costs represent the largest expenditure group for the General Fund since most of the departments including police and fire are budgeted in the general fund. There were no new positions added to the budget and eight positions were eliminated either through attrition or reorganization. The budget contains an average increase of 2.5% for fire union employees. Pension fund contributions increased for the city for both funds- general employees increase 5.45% and police and fire increased 5.82 %. Overall department budgets for general fund were flat. Funding is proposed for computer and server replacements ($39,000 and $46,000). No funding included for federal lobbyist. In addition to a grant for police radios, other proposed equipment purchases include: digital portable radios for Police (4), a flash cam, and mobile data extraction equipment and software. We're also replacing 3 police vehicles and 2 for Maintenance Operations. The miscellaneous road paving includes some streets in Forest Oaks August 15, 2012 Page 2 of 8 City Commission Budget Workshop and Sawmill Subdivision. There is a grant for Ison Center Improvements for next year and funding for an Event Center is also included in the proposed budget with general fund revenues and recreation impact fees being used. We are also replacing a truck, utility cart and aerator in Parks and adding a security camera. Highlights for the stormwater fund include the transfer of an equipment operator position from Streets to Stormwater. Funding for Improvements at the Bluford Avenue and Orlando Avenue intersection; and Wekiva River Basin Projects is included. Vehicles being proposed to be purchased include a new sweeper truck and two replacement pickups. Budget Highlights for the Water /Wastewater Utility Fund include: Citywide water and sanitary sewer system improvements including water line replacements and upgrades, replacing old or installing new fire hydrants. There are plant improvements for Forest Oaks and South water plants and the A.D. Mims Wastewater plant. Funding is also included for relocating water and sewer mains as part of SR50 road widening project and replacement of the SCADA and instrumentation at the water plant. Equipment being proposed to be purchased: Vac master vehicle, pick -up truck - replacement, and 6" Trash pump. The proposed budget is flat for Sanitation fund; however, we are proposing to replace a side load garbage truck and purchase a digital radio system for them. The Recreation Impact Fund includes the Event Center with funding split between general fund and recreation impact fund. Also there is funding for a recreation complex that would house a softball tournament level fields. Finally, there is the wish list for FY 2013; a copy was included in the presentation packet distributed on the dais. These are items requested by departments but not included in the proposed budget. The cost of each item and the corresponding increase to the millage rate are presented to assist in the decision making. IV. Wish List for FY12 /13 Budget — Distributed (attached) V. Discussion Under Budget Highlight - Commissioner Hood inquired how much is taken out of the general fund and the recreational fund for the event center. Finance Director Horton answered that $1,172,500 is taken out of general and $577, 500 is out of recreational funds. City Manager Frank commented that part of the reason it is broken up between the two funds is because recreation impact fee dollars can only be used for the additional floor space they are getting. The floor area from the previous building has to be done by general fund. Commissioner Hood said he does have some more questions but would like to call some of the staff members during the week if that is okay with the City Manager. PAGE BY PAGE: 2 -1 Mayor Vandergrift inquired as to why the Stormwater Utility fund was down roughly $600,000 and Wastewater Utility fund down roughly $2,000,000. Finance Director Horton explained that in Stormwater and Wastewater Utility fund they are not using any of the cash carry forward for this year which is the difference. She further advised that page 5 -3 Beginning Cash shows what she just explained. Commissioner Hood inquired where the funds are for Peach Lake Manor and the Lady Lake corridor for the repaving. Public Works Director Krug said those funds are actually coming out of stormwater and since those roads have already been budgeted they should be seeing August 15, 2012 Page 3 of 8 City Commission Budget Workshop advertising by the end of the month. He further advised there is a lot of work to be done so this will be a two year project. 3 -5 Infrastructure Inspection Fee went down from $13,750 to $52,750. Mayor Vandergrift inquired why the drop. City Engineer Wheeler explained they do not see a lot of projects going on this year. City Manager Frank added that he is looking at the proposed revenue. 3 -12 Commissioner Keller said he noticed 4100 telephone expenses went up for City Commission. Information Systems Manager Ross explained the wireless on the iPads is part of the expense increase since there were activations for it. Commissioner Hood inquired if since the switch to iPads if there was a savings on paper and staff time. City Manager Frank said he believes there is. He further clarified that telephone expenses also covers the mifi and any type of data communication charges on their cellphones. 3 -21 5402 Professional Dues - Mayor Vandergrift inquired about increase of $8,320 to $37,800. Finance Director Horton advised that $30,000 of that is for the Tri -City Partnership. City Manager Frank explained that is for the marketing effort between Apopka, Ocoee, and Winter Garden. Mayor Vandergrift inquired as to who is keeping the money. City Manager Frank answered that at some point an RFP will be put out and they will have a chance to comment on it. The intent is to hire a marketing professional to develop marketing material and give presentations pertinent to the three cities. 3 -21 4950 Advisory Board - Commissioner Keller said he is assuming the $2000 budgeted is for the Human Relations Diversity Board; however, Chairman Maxwell had come before them with a presentation requesting $30,000- $40,000 which is obvious that the city cannot afford. The last two years the city budgeted $5,000- $7,000 for that board. City Manager Frank explained they most likely defaulted back to the previous years when the commission had awarded $500 -$2000 for advisory boards. The city did not want to assume anything which is why they plugged in what the commission had approved in the past for all boards. Mayor Vandergrift inquired if this is something they would like to consider on the wishlist. Commissioner Keller said he feels they should because just the MLK parade is going to cost more than $2,000 and he hates to see the city go backwards and have to stop the parade. 3 -24 Elections Mayor Vandergrift inquired about the $90,000 in elections. Commissioner Johnson said he would like to discuss moving the election back to November to go along with the County. He was told and even verified that they could go with the November election next year and it would not be as costly. Commissioner Wilsen inquired if this would be a charter issue. City Clerk Eikenberry explained that this year because of the presidential election Bill Cowles advised the municipalities that there is no way that they could fit municipal issues on the ballot but if the commission is referring to Novembers in the future. Commissioner Johnson said he has spoken the Supervisor of Elections Bill Cowles and was told they did not have a problem with Ocoee putting their election on the November ballot. He further informed Commissioner Wilsen that this situation is the same as the last election and the Commission can take a vote just like they did before. City Manager Frank advised that moving the election does not guarantee that the city will not be charged for services they do. He further advised that if the Commission would like, he can have staff send a letter requesting information. City Manager Frank further said they will also need to check the charter because he is sure that the charter does state the election is to take place in March. City Clerk Eikenberry shared that the charter August 15, 2012 Page 4 of 8 City Commission Budget Workshop does state the election will be held the second Tuesday in March. Commissioner Johnson inquired how was it they changed it last year. Mayor Vandergrift said without objection he would like for staff to bring back a report. City Clerk Eikenberry explained that for the last election municipalities were allowed to adopt an ordinance allowing us to piggyback on the Presidential Preference Primary Election for 2012. Commissioner Wilsen commented that if this is something they need to change the charter for; then they can change the charter. She further said $90,000 is a lot of money. City Clerk Eikenberry asked them to keep in mind that they have to budget for worst case scenario. For example, even though we piggybacked off of the Presidential Preference Primary election this year, we had to budget $45,000 in case there was a run -off, but we did not end up needing it. 3 -39 2200 Retirement Contribution - Mayor Vandergrift requested an explanation on the Retirement Contribution's going up by $25,000. Finance Director Horton explained the retirement contribution is going up for every department and explanation was included in the previous presentation which explained it would increase by 5.45% for General and 5.82% for Police and Fire. City Manager Frank shared that the upcoming Regular Commission Meeting will include a first reading of an ordinance that will re -vamp the General Employees' Pension and bring benefits more in line with the private sector. Mayor Vandergrift and Commissioner Hood both agreed that a report should be provided to the Commission advising how the pension is performing. 3 -39 3400 Contractual Services — Mayor Vandergrift inquired about the decrease from $35,000 to $1 000. Finance Director Horton explained the $35,000 is for the HR consultant and the actual amount was split in the current year budget between HR and General Government. For next year the total amount will appear in General Government which is the 516 department. Commissioner Johnson inquired how much would be budgeted for that position. Finance Department Director said $39,500 is budgeted for that position. 3 -46 Impact Fee Study — Mayor Vandergrift inquired if the impact study was required this year. City Manager Frank explained that the Commission had expressed some interest in maybe looking at the methodology for quality restaurants and such. There was a concern that the impact fees were keeping those type of establishments out of the city so they wanted to re -do the methodology and see if there was another way to bring the fees down for the particular categories they wanted to lure into the City. Commissioner Hood inquired as to how much was taken out of reserves. City Manager Frank explained that they originally started with $2.3 million but that is what they had historically put in every year. This year they added an additional million out of reserves to cover the Community Center construction so it's right around $4.0 -$4.2 million. Finance Director Horton clarified that there was $3,922,500 taken out of reserves and $1,172,000 is for the Community Center. City Manager Frank briefly explained what they typically put into the reserves to get to zero. Commissioner Hood inquired what the balance of the reserves would be. City Manager Frank said starting right now it would be somewhere around $10 mil. Commissioner Hood inquired if that would impact our bonding. City Manager Frank said it should not and one of the things the financial advisor and bond counselor looks at is the amount of reserves that you do have and the city has very good reserves. August 15, 2012 Page 5 of 8 City Commission Budget Workshop 3 -52 2400 Workers' Comp Insurance — Commissioner Keller said they have been going up and down with the budget on this item and inquired why? City Manager Frank explained that they did have reserve money last year in workers' comp which had brought it down to an artificially low number so they are now starting to see a more realistic number. 3 -55 Public Works Administration Chart — Mayor Vandergrift said this chart does not show how many people are under each division and the other charts do. City Manager Frank advised they can fix that chart for the next meeting. Finance Director Horton advised the numbers of employees are detailed on the organizational chart for each section but they can correct the master sheet. 3 -57 4301 Water Expense — Mayor Vandergrift and Commissioner Keller inquired on the drop from $11,000 to $1500. Finance Manager Pam Brosonski advised they will not be spending the $11,000 budgeted for this year; so far only $600 has been spent out of that line item. Finance Director Horton advised that they will go back to look at last year's budget to see why that account was increased and an answer can be provided at the next workshop. 3 -60 Capital Outlay — Delivery Van Replacements (2) — Mayor Vandergrift inquired if they have looked at hybrids. Public Works Director Krug advised the vans are for the custodians and will be small commercial type vans for carrying around all there equipment. They are currently using two vehicles which should have been surplus and are not functioning properly. Commissioner Johnson said he believes they can buy them cheaper than what they have listed. Public Works Director Krug explained the vans they are considering are used and they are able to get them from the Sheriff's bid list. Mayor Vandergrift briefly shared that major purchases like this they may want to consider a lease plan or opening up a line of credit. City Manager Frank said they do lease purchase for vehicles over $25,000 and anything under they pay for it in cash. 3 -61 Building Maintenance — Commissioner Keller said he noticed the Fire Station remained the same but was wondering if there was enough since they are opening the new sub station near Publix. Public Works Director Krug said they should be okay with what the budgeted since that is mainly for repairs and the building for the Fire Department is new which his guys are doing a fantastic job out there. Mayor Vandergrift said on this same page (3 -61), they have the Maguire House maintenance for $5,000 and on the wishlist they have the Maguire House under Capital Expenses for $50,000, was that correct. He was told that was correct. Wish List - Commissioner Keller discussed the police firing range that is on the wish list at a cost of $100,000. He asked if we know how much we spend each year sending our officers to the Sheriff's Office range or other locations. He understands that we are probably waiting for a year or two to build our own range, but wondered how much we are spending to put off the project. Chief Brown stated that it is rented on a daily basis and it frequently takes several days to get everyone qualified. He said he does not have numbers, but he can put some together. He can also get a cost on leasing space as opposed to moving the range. Commissioner Hood asked about the plan to put it at the public works site. Chief Brown said that is one of the options if we decide to have our own range, it does need to be cleaned up. 3 -72 Fire, Small Equipment 5230 -- Chief McNeil explained it is for portable radios, we are at an absolute minimum right now. Mayor Vandergrift said we should look at a line of credit to finance it over 3 years. Chief McNeil said that is traditionally done with larger dollar items, but August 15, 2012 Page 6 of 8 City Commission Budget Workshop he will discuss that with the finance department. He added that under protective equipment they did do a lease - purchase over a five year period due to the total cost. Wish List - There was discussion as to why the blank wish list given to them in an Excel spreadsheet did not work on the iPads and Commissioner Keller said that they need an additional app to make it work properly. 3 -71 Fire, Travel Expense 4000 - Commissioner Keller asked why the travel budget went down $2000. Chief McNeil said they are not going to as many conferences this year in an effort to save money. 3 -78 Fire Dispatch -- Mayor Vandergrift confirmed the cost of $174,000 per year for fire dispatch and asked how much we are paying Apopka for police dispatch. City Manager Frank said it is close to $500,000. We went with Apopka because they had compatible equipment to ours. The last fiscal year we had our own dispatch the cost was approximately $800,000. There was discussion regarding the contract with Apopka coming due and we should try to negotiate a lower price. Fire Chief McNeil said that fire department is cost sharing dispatch services with two other cities. Fire Rescue - Commissioner Wilsen said she would like to see response time changes due to the new fire station. Chief McNeil said those numbers are currently being tracked and he can provide that information. Commissioner Hood said that should show poor response times from Rural Metro in the north area; and Chief McNeil confirmed and said that is why there is a need for the new station on that end of the city. 3 -86 Street Operation — repaving. Mayor Vandergrift asked Public Works Director Krug to explain how they determine which streets need repaving. Mr. Krug gave a brief summary explaining the process for the past budget and the upcoming year's budget. He described some of the roads, such as Prairie Lake Blvd., where the whole base was deteriorated and needed to be replaced. He said it will be the same situation in the upcoming budget with Marshall Farms Road. 3 -87 Streets 4300 Electric Expense - Mayor Vandergrift noted it went from $622,500 to $655,500. Mr. Krug advised that most of that is for street lighting. 3 -86 Streets, Capital Outlay- Mayor Vandergrift asked about $45,000 budgeted for lights at Silver Star and Ocoee Oaks Rd. Mr. Krug said that is for the upgrade to the signalization mast arms; the city has assigned a memorandum of understanding agreeing to do this. Wishlist - $2300 for Ingram Road, Commissioner Hood asked City Engineer if that was for maintenance and when it will be installed. Mr. Wheeler stated that $2345 is for the maintenance; the cost to install the lights is $32,345. Installation date is unknown as those are wishlist items. Wishlist — Commissioner Wilsen mentioned she would like to get Jay Street and Cardinal Street done, too. Speed Tables - Commissioner Keller asked the cost of speed humps. He would like to see each district get two speed humps. Mr. Krug said they are approximately $5600. He said we have some requests from residents, but the commission needs to decide if they are going to waive the August 15, 2012 Page 7 of 8 City Commission Budget Workshop $240 fee. The rest of the Commission stated it should be done by need, not by district. They advised they are not getting complaints in their districts and they would rather the residents petition for them using the process that we have in place. Consensus was there should be money in the general budget for speed humps and it should be used where the highest need is. Public Works Director Krug said he will bring back figures for the money that is left in the current budget; there may be enough left to take care of some of the areas Commissioner Keller is talking about. Mayor Vandergrift said he would like for us to look into narrow brick streets as traffic calming and give the developer impact fee credits. This would raise property values also and possibly add a few extra lots to the development. He would also like to have laws changed to get cameras in neighborhoods. 7:12 p.m. Commissioner Hood left the meeting 5 -9 Utilities, 3128 Professional Services — Mayor Vandergrift asked about the reduction from $139,000 down to $89,000. Finance Director Horton said the CUP permit compliance and miscellaneous expenses caused a $60,000 decrease from last year. City Manager Frank said we are wrapping up most of the CUP compliance issues over the last few years. Wekiva District - Mayor Vandergrift said he is unsure where he saw it but asked about $250,000 for meeting Wekiva District compliance issues. City Manager Frank advised they staff will get back to them with information on this. 5 -15 Expenditure summary- Water plants SCADA instrumentation replacement, $250,000. City Manager Frank said that is the equipment that communicates with the entire water system. The system we have now is obsolete; we got a very good price on this system. The Mayor asked about financing it. City Manager Frank said we have cash reserves for this: there is no reason to finance it and pay interest charges. Page 5 -16 4602 Building Maintenance - Mayor Vandergrift noted it went from $10,000 to $28,700. Opening Statement - Commissioner Wilsen asked about the complete auto parts shop. City Manager Frank said companies such as NAPA will supply your whole shop and replace them as needed. They anticipate saving about $100,000 annually. She confirmed that a position is being eliminated. Page 5 -21 Vac Master vehicle, $57,500 1/2 cost, Mayor Vandergrift asked if that would that be better to spread out over time. City Manager Frank said that is an enterprise fund and we have money to pay for it, so that has been our policy not to finance in that case. Mayor Vandergrift spoke about creating a Utilities Commission, and make money providing our own utilities. City Manager Frank explained that we charge the enterprise funds 12% to cover administrative and other costs, so it is not that we are not making any money. Commissioner Wilsen questioned the costs to set up that type of system as opposed to what we are getting now. The Mayor felt we should look at handling our own utilities, water, sewer. electric, etc. Page 5 -27, 4301 water expense in the sewer department from $109,000 to $150,000. Finance Accountant Briggs advised that is the wholesale cost for reclaimed that we resell to the customers. August 15, 2012 Page 8 of 8 City Commission Budget Workshop Mayor Vandergrift asked if secretarial costs for the fund are corning back into the city budget. City Manager Frank said all of the utility department employees are paid 100% by the utilities fund. The 12% is for billing counter, finance doing paychecks, customer service complaints, etc. Mayor Vandergrift discussed in the past that money had been moved from these funds to the general fund, to which City Manager Frank stated it has not been done in the last nine years. He said if the Commission desired to do that, it may be acceptable, but they would have to explore the legalities of it. Commissioner Johnson wanted to add personnel increases into the wish list, for 2% at mid -year for general employees. He would like to get a rough cost. Finance Director Horton said it is $131,000 for a 2% increase at mid -year. Commissioner Johnson said since Police and Fire are getting raises, he feels the general employees should get one also. The Consensus of the commission was to adjourn at 7:30 p.m. since they are more than half way through and resume on August 29th when Commission Hood will be back. IV. ADJOURNMENT The meeting adjourned at 7:30p.m. APPROVED: Attest: City of Ocoee r s ,,) ,,FF CAJ 4 -1 L. 1 .— ------ et 1 ' ikenberry, City Cler -- S. Scott Vandergrift, May r