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08/18/2009 MinutesCITY OF GRAND ISLAND, NEBRASKA MINUTES OF CITY COUNCIL BUDGET MEETING August 18, 2009 Pursuant to due call and notice thereof, a Regular Meeting of the City Council of the City of Grand Island, Nebraska was conducted in the Council Chambers of City Hall, 100 East First Street, on August 18, 2009. Notice of the meeting was given in The Grand Island Independent on August 12, 2009. Mayor Hornady called the meeting to order at 7:00 p.m. The following City Council members were present: Councilmember's Meyer, Niemann, Gilbert, Haase, Carney, Dugan, Ramsey, Nickerson, and Gericke. Councilmember Zapata was absent. The following City Officials were present: City Administrator Jeff Pederson, City Clerk RaNae Edwards, Finance Director Mary Lou Brown, City Attorney Dale Shotkoski, and Public Works Director Steve Riehle. INVOCATION was given by Mayor Hornady followed by the PLEDGE OF ALLEGIANCE. MAYOR COMMUNICATION: Mayor Hornady introduced Community Youth Council members Audie Aguilar and Kiara Solorzano. PUBLIC HEARINGS: Public Hearing on Proposed FY 2009-2010 City Sin lg e Budget. Mary Lou Brown, Finance Director reported that Council needed to conduct a public hearing to take information from the citizens of Grand Island on the proposed FY 2009-2010 City Single Budget. Adoption of the budget and lid limit increase was scheduled for September 8, 2009. Mike McDermott, 1603 Gretchen Avenue and Lynn Widdifield, 223 South Shady Bend Road spoke in opposition to a tax increase. No further public testimony was heard. Councilmember Zapata was present at 7:10 p.m. Public Hearing on Community Redevelopment Authority (CRA Budget. Chad Nabity, Regional Planning Director presented the CRA 2009-2010 Annual Budget. Presented was a PowerPoint presentation explaining the CRA programs and functions. The following budget highlights were presented: 1) $100,000 to purchase dilapidated properties/infrastructure 2) $150,000 for facade development and 3) $800,000 for other projects. Total CRA request was $425,000 for 2009-2010 which was down from $475,000 requested in 2008-2009. No public testimony was heard. Review of Proposed FY 2009/2010 City Sin lg e Budget. Mayor Hornady commented on the long difficult process of creating the 2009-2010 budget. Mentioned was that the department director's would present their budget and then questions would follow. The plan was to work until 9:30 p.m. with further meetings scheduled for Wednesday and Thursday. Jeff Pederson, City Administrator commented briefly on the city budget including the Budget in Brief document, transmittal letter, and salary survey recently received by the Human Resources Department. Council reviewed each of the following department budgets: Page 2, City Council Budget Meeting, August 18, 19, & 20, 2009 Administration -Paul Breseno, Assistant to the City Administrator presented the following budgets. Personnel services increase of 3.55% due to step and annual increases and a decrease in Health Insurance. Operating Expenses Increase of 2.19% due to ICMA Program Prioritization and Community Results and National Citizen Survey. Le islative Mayor and City Council) -City Council operating expenses increase of 8.38% includes $3,600 for employee benefits Internet stipend and $7,000 for council laptops. City Clerk -Decrease of 2.5% includes deletion of tuition reimbursement and decrease of election costs. One of the biggest items in the budget was legal notices in the amount of $16,000. Public Information -Personnel services increase of 6.59% due to increase to step and annual increases. Operating expenses decrease of 33.63% and Capital expenses decrease of 20.15%. Council President Meyer spoke concerning travel and training, and other expenditures. His recommendation was to cut those line items in half. Jeff Pederson and Mary Lou Brown commented on the need and legitimacy for "other accounts". Councilmember Nickerson commented on the cut of travel and training stating 50% was too drastic, but some sort of a cut was necessary. Councilmember Haase raised concerns on exceeding line items within each budget. Also mentioned were the City's fiscal policies. Finance -Mary Lou Brown, Finance Director presented the Finance Department budget. Sales tax was up 1.3% over prior fiscal year. The 2010 budget reflects an annual increase of 1.8% over the 2009 projected receipts. Occupation tax was to be used for only two purposes: State Fair Building lease payments of $755,000 per year and expenses for the Veteran's Athletic Complex. Property tax reflects the 12% proposed rate increase. Motor vehicle tax collections reflect ayear- over-year growth rate of 1.9%. Total operating expense in non-departmental was $530,600 and lease payments were $2,197,000. Nineteen employees were represented by the Finance IBEW Union; an additional 2 would be part of the new IBEW Union. The monthly average number of customers billed in 2008 was: electric - 24,129; water - 15,270 and sewer - 14,867. 90% of the Finance Operation Expense was related to personnel and the charge for IT services. Grand Island was a leader in the use of Munis and drives many of the overall system enhancements. Ms. Brown explained Informational Technologies (IT) was used by other City departments and each department was charged for those services. Six of these employees would be represented by the new IBEW Union. A review of the needs of the City and the current structure of IT would be completed this fall. Ms. Brown gave an overview of the IT System Support. IT revenue was received from each department within the City for a total of $1,014,975.00. 85% of IT expense was related to personnel service and contract services. $210,000 was the expense related to Munis and Microsoft licensing fees. Ms. Brown explained the known changes to proposed 2009- 2010Ending Cash Balances and Proposed Budget Appropriations. Councilmember Gilbert suggested every department try to find ways to save money. Mentioned was to have a balanced budget. Councilmember Haase asked questions concerning the credit card expense for customers paying by credit card. Comments were made on the IT budget in the amount of $1.1 million. Councilmember Carney commented on the transmittal letter relying more on debt to pay for capital improvement projects, how much the citizen's could pay through Page 3, Ciry Council Budget Meeting, August 18, 19, & 20, 2009 taxes, and if there was a limit. Councilmember Dugan commented on the growth of revenues, expenses, and government services. He stated our focus needed to be put on the core services the City needed to provide. Leal -Dale Shotkoski, City Attorney presented the Legal Department budget. The Legal department was a small department with only three employees which provides services to the General fund departments and Enterprise fund departments. Revenues come from the Stop program and enterprise fund reimbursement. Total budget for the Legal department was $343,228 or 0.88% of the 2009-2010 proposed budget. The department budget increase of $17,570 represented a 5.39% increase to the department. The increase was equal to .045% ofthe total General fund budget. The increase was due to wage (step) increases. Operating expense for 2009-2010 proposed budget was 3.47% less than 2008-2009. Discussion was held on travel and training. Mr. Shotkoski explained continuing education was required by the Nebraska State Bar Association. Outside legal council was discussed. Councilmember Gilbert stated continuing education should be paid by the employee. Human Resources -Brenda Sutherland, Human Resources Department Director presented the Human Resources Department budget. Primary responsibilities were: recruitment, compliance and information management, benefit and risk management administration, labor relations, and classification and compensation. Human Resources provided support for all other departments in the City. The dollars budgeted represented 1.15% ($454,890) of the general fund budget. 25% of the Human Resources budget was allocated to operating expenses such as: comparability surveys, EAP services, citywide training, advertising, applicant tracking system, employee evaluation system, and pre-hire testing. Ms. Sutherland explained the wellness program within the City. Medical and prescription drug claims were down by more than $200,000 over the past twelve months. The City was recently notified by Governor Heineman that the City would be receiving the Governor's Excellence in Wellness Award in September. A new health insurance vendor was currently being negotiated and a contract would be brought before the Council at the August 25, 2009 council meeting. Risk management was mentioned with a reduction of more than $53,000 paid by departments for work comp. insurance and work comp. claims paid from O1 /09 thru 07/09 were $114,2501ess than the same time period last year. Councilmember Gilbert stated the City paid much better than other businesses with regards to benefits. Ms. Sutherland stated this was due to the comparability study required by law. Councilmember Haase commented on health insurance and pension. Co-pay and self insurance were mentioned. Ending cash balance reserve for insurance was discussed. Pension expenses were mentioned. Ms. Brown stated annual actuarial studies would be required. Councilmember Niemann asked if percentage of salary was related to benefits. Ms. Sutherland stated the City ran around 25%. Councilmember Carney asked if we had a cap on self assurance. Ms. Sutherland stated we had a $1 million dollar maximum coverage for medical. Legal fees for CIR were paid out of the Human Resources budget. Other legal fees were paid out of the general fund. Councilmember Haase asked about the cafeteria plan and if it was a benefit to the employee. Ms. Sutherland stated it was a great benefit to the employee because of the tax break. Building -Craig Lewis, Building Department Director presented the Building Department budget. Two divisions made up the Building Department fund which included maintenance and Page 4, Ciry Council Budget Meeting, August 18, 19, & 20, 2009 Building Inspections/Permits. Explained were the maintenance needs for the City building. Permit and inspection fees brought in approximately 70% to offset the total budget. Councilmember Gilbert commented on the number of employees in the department compared to the number of permits, inspections, and construction. Mr. Lewis explained the need for the number of employees and what they did. Councilmember Meyer questioned insurance premium, fuel, and vehicles. Councilmember Haase commented on keeping vehicles longer and revenue sources through the plumbing inspector. Motion by Nickerson, second by Zapata to fix the time to which to adjourn to Wednesday, August 19, 2009 at 7:00 p.m. Upon roll call vote, all voted aye. Motion adopted. ADJOURNMENT: The meeting was adjourned at 9:35 p.m. ?~~ ~~-. RaNae Edwards City Clerk