BUDGET WORKSHOP MINUTES
PORT ORANGE ADULT ACTIVITY CENTER
4790 RIDGEWOOD AVENUE, PORT ORANGE
JULY 13, 2013
THE BUDGET WORKSHOP of the City of Port Orange City Council was called to order by Mayor Allen Green at 8:30 a.m.
Pledge of Allegiance
Roll Call: Present: Councilman Bob Ford
Councilman Drew Bastian
Councilman Dennis Kennedy
Vice Mayor Donald Burnette
Mayor Allen Green
Also Present: Gregory A. Kisela, City Manager
Shannon Lewis, Asst. City Manager
Margaret T. Roberts, City Attorney
Robin Fenwick, City Clerk
4. Employee Climate Survey Review
Greg Kisela, City Manager, introduced Jim Percy, who assisted management with the employee climate survey. Mr. Percy provided results of the survey. There was 81% response.
Mayor Green thanked Mr. Percy for his company’s work on the survey.
5. Proposed FY2014 Budget Presentation
Mr. Kisela provided an overview of the challenges with the budget revenues. Wayne Saunders, Finance Director, provided details of the proposed budget. The proposed budget is currently in balance. Mr. Saunders discussed the process of working through the budget and approving it.
General Fund discussion: proposed revenue and reserves total $30,242,364 and expenditures are in the same amount. The current operating millage rate is 4.8051 plus the voter approved debt service of .5669. The proposed millage rate for FY2014 is 4.8051 for operating and .4910 for debt service.
Special Revenue Funds: Eastport CRA total revenue and reserves total $274,301 with expenditures being the same amount. $114,344 is being used from reserves to balance the budget. Town Center CRA revenues total $390,626 with expenditures being equal. $278,928 is being transferred from the loan pool. Recreation facilities, building special revenue, CDBG, recreation scholarship, and business development program funds were discussed and are all in balance. The business development program fund will be consolidated into the general fund.
Debt Service funds were discussed, as well as proprietary funds. The water/sewer fund is in balance. The forestry fund is also going to use some reserves to balance. The solid waste fund is also going to need to utilize some reserves, as well as drainage utility fund. The gold course operating fund is anticipating $50,643 increase to reserves.
Internal Service Funds: Information Technology, vehicle maintenance, insurance, building maintenance, and loan pool funds were discussed.
Council took a ten minute break.
6. Budget Discussion
Vice Mayor Burnette is concerned with using bond reserves to balance the budget. He wants to be at roll back or better but doesn’t like the idea of using reserves to balance. He asked for additional information regarding the funds that will be closed and balances moved to the general fund. He would prefer to see names on the personnel projections. He wants to have a policy discussion regarding the fire chief position. He wants to know how their goals from the May Budget Workshop have been incorporated into the budget changes. He doesn’t agree with providing the same raise to all employees. He believes some employees work harder than others and should be compensated more for their hard work. He would like a debt report compared to three years ago. He’d also like to see comparisons of department budgets from year to year. He asked for the balance after monies are used in the loan pool fund. Vice Mayor Burnette asked if DROP employees are also getting the raise. Mr. Kisela said yes, that is his understand of past practice.
Ted Noftall, citizen, doesn’t like the increase in expenses in police and fire. He believes they are not sustainable.
Corey Berman, citizen, provided his thoughts on saving money in the budget.
Joe Fazzie, citizen, thanked Staff for their work on the budget. He suggested deferring the hiring of the fire chief for six months.
Sonya Laney, citizen, suggested looking at processes within each department to streamline. She wants to see internal controls strengthened, as well as departments eliminating waste within their departments.
Councilman Bastian asked about the difference in the YMCA amounts. Stella Gurnee, Comptroller, explained the amounts received are split between two funds. Councilman Bastian is concerned with the use of reserves to balance the budget.
Councilman Ford wants to discuss the employee buyback program. He wants to fix the issues with the ICMA 457 contributions. Some qualified employees receive it and some don’t. He also wants to discuss and make a policy decision regarding the part time employees and their benefits.
Mr. Kisela advised that the total cost of the buyback program is approximately $575,000-$580,000 for all of the employee classes. He believes about 3-4 of the employees are covered under collective bargaining agreements. He agrees that consistency is needed with the ICMA 457 contributions and the part time employee benefits. Rob Zicker, HR Director, explained the details of the buyback program and the vacation overage.
Councilman Kennedy agrees that changes are needed for uniformity. He wants to be at roll back. He asked where the dollar amount came from for the fire pension increase. Mr. Kisela said the pension reserves are paying for the increase. The increase was determined by the actuary.
Vice Mayor Burnette wants to utilize reserves to stay at roll back. He wants to discuss the fire chief position and separating the police and fire departments. He supports hiring from within the City or at least within Volusia County.
Mayor Green asked if the position is a fire chief or administrator. Mr. Kisela explained the question with pension issues if the City hires a fire chief vs. an administrator. Staff is working through it. Councilman Ford said hiring a new fire chief or administrator will not increase the budget by 125%, he states it will be 16-18%. Mr. Kisela advised that the actuaries base their numbers on a percentage of the expected payroll. Councilman Bastian doesn’t agree with hiring an administrator who is not a certified firefighter.
Mr. Berman addressed Council regarding the overload on the Public Safety Director. He supports separating the police and fire departments. He questioned the health insurance and ICMA payment for the Mayor’s position when none of the other Council Members are receiving the same. Councilman Ford advised that all Council Members are eligible to receive health insurance and some have not elected to take the benefit. Mr. Kisela advised that the Mayor’s 457 payment is an item currently being researched.
Mayor Green asked Council Members if they are in favor of separating police and fire departments. Vice Mayor Burnette and Councilman Kennedy want to hear more justification as to whether or not the departments should be separated. Councilman Ford wants to separate the departments. The employees are not happy. The combined department is not working. He supports spending the funds to separate the departments. Councilman Bastian agrees with Councilman Ford. He wants to listen to the employees. Mayor Green warned Council to address the debt associated with the fire department.
Mr. Noftall doesn’t agree with Council approving the large increase in expenses for police and fire.
Consensus of Council is to move forward with hiring a fire chief/administrator.
7. Proposed Millage Discussion (Adoption on 7/23/13)
Mr. Kisela asked Council for direction regarding the millage rate. He doesn’t like using reserves to balance the budget. He doesn’t want to come back next year using one-time monies.
Vice Mayor Burnette supports the roll back rate. He wants the expenses cut rather than pull from reserves.
Councilman Ford asked Council to direct Mr. Kisela to cut back the buyback program by 50%. He would like the ICMA 457 contributions to be discontinued. He asked if there are any legal issues with discontinuing the contributions.
Mayor Green asked if the contributions are part of contracts. Mr. Kisela said yes.
Mr. Kisela asked for flexibility to include the buyback program cuts into the FY2015 because the collective bargaining agreements will have to meet. Mr. Kisela will bring the issues and proposed resolutions back.
Councilman Bastian does not support going to roll back. He wants to keep it at the proposed rate.
Mayor Green reminded Council that they can always go lower later but they need to provide the funding for the projects and services being requested.
Councilman Ford requests Staff attempt to cut the $244,000+ to be at roll back. He doesn’t feel good about waiting another year to increase the rate.
Councilman Kennedy agrees with Councilman Ford.
Vice Mayor Burnette supports being at roll back or better.
Mr. Fazzie suggested Staff provide risks and opportunities associated with the cuts to stay at roll back.
Mr. Berman suggested the travel expense be eliminated.
Ms. Laney cautioned making several changes at once. The ordinances will take an extensive and expensive overhaul at this time. She suggested making a plan and taking time to correct all of the issues.
Mr. Noftall does not support the current proposed millage rate.
8. Proposed Public Hearing Dates
First Public Hearing regarding the Budget will be held on September 3, 2013 and the Final Public Hearing will be held on September 17, 2013 both at 6:30 p.m.
ADJOURNMENT: 11:49 a.m.
Mayor Allen Green
Robin L. Fenwick, City Clerk