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HomeMy WebLinkAboutMinutes - City Council - 01/12/2011CITY COUNCIL 12 JANUARY 2011 Draft The South Burlington City Council held a budget workshop on Wednesday, 12 January, 2011, at 6:00 p.m., in the Conference Room, City Hall, 575 Dorset St. Councilors Present: M. Boucher, Chair; S. Dooley, J. Knapp, M. Emery Also Present: S. Miller, City Manager; R. Rusten, Assistant City Manager; S. Stitzel, City Attorney; J. Rabidoux, Department of Public Works; T. DiPietro, Stormwater Department; Chief D. Brent, Fire Department; S. Crosby, WPC Department; K. Murphy, City Hall staff; C. Plumb, D. Wheeler, M. Boyer, B. Munger 1. Budget Workshop to Review FY12 Budget: Mr. Miller noted that the City Council had asked what might happen if the budget wasn’t approved by the voters. He asked the City Attorney to address that possibility. Mr. Stitzel reviewed the history of the City Charter through elimination of Charter limits and the start of public voting on the city budget. He explained the “two strikes and you’re out” element, which means that if the proposed budget is defeated twice, the budget would revert to the net operating budget of the previous year plus a CPI adjustment. Given recent history, the question this year is what exactly was last year’s net operating budget.  Mr. Stitzel said the City Council would have to bring this into very clear focus, and taxpayers would have the option to challenge in court whatever definition of “last year’s operating budget” the Council decided upon. Mr. Stitzel noted that a number of revenue items and a number of expense items never appeared in that budget. He stressed that the Charter language is not tied into what was voted upon; it is tied into the net cost of operations in the preceding year’s budget. There are a number of identified deductions in the Charter language to determine the net cost of operations. These include: bonded debt payment, municipal utilities funded by user fees, special appropriations (separately voted on for specific purposes), federal and/or state aid for specific programs, transfer payments (money collected that is transferred to other entities), tuition income for non-resident students (school budget), payments assessed by other public bodies (e.g., CCTA, MPO, County Courthouse), and non-governmental revenue (charitable donations for such things as the recreation path, etc.). Mr. Miller said there is a possibility that if the budget is defeated twice, taxpayers cold wind up with a higher budget. a. Highway and Parks Budget: Mr. Rabidoux noted that within the past few months, through attrition and layoffs, there are 3 fewer employees, and these positions will not be funded in the FY2012 budget. An additional $6000 is proposed for traffic light supplies. In the past, an out-of-state contractor did road striping at intersections. The city is proposing to purchase a walk-behind line-striping machine so that this can be done by city staff at a savings to the city. Mr. Rabidoux noted that the impervious surfaces on city-owned properties result in storm water fees. Mr. Miller said the amount budgeted is the amount the city should be paying into the storm water fund. Mr. Rabidoux said that because they can’t count on money from the rooms & meals local option tax, they have reduced paving plans. Mr. Rabidoux noted that they are working to set up a formal equipment fund. Mr. Rusten explained that this will allow items to be paid for in cash, so there will not have to be future borrowing. Mr. Rabidoux also noted the budget item for “fuel pump surcharge” for fuel for municipal vehicles. He said he was told that revenue from this never went to an existing fund. He indicated that he is asking for $70,000 in a fund for future upgrades, repairs, etc. b. Parks Department: Mr. Rabidoux noted that most of the expenses for parks are fixed. The increase in salaries may have resulted from personnel being charged to other departments in the past. Mr. Rusten said there hadn’t been an appropriate allocation of funds for salaries for Parks. Mr. Miller noted that in the past, the city had been paying the school for maintenance of school grounds and was doing the work. Mr. Boucher explained that after Act 60, certain expenses were transferred from the school to the city. Mr. Miller noted that the schools also don’t pay for bus maintenance. He said he is recommending that the schools pay $70,000 for this maintenance. He added that maintenance would cost much more if the work had to be done outside the city. Members supported adding that $70,000 into the budget as revenue. c. Stormwater Utility: There will be one fewer employee, through a layoff. A reduction in diesel fuel relates to employees who plow and are issued a gas card. Mr. DiPietro noted an increase in Administrative Services due to proper allocation of costs of monitoring impaired streams. Regarding “Grant Matches for Systems,” which involves local matches for grants for specific projects, Mr. DiPietro said this money was tracked on paper in the past, but he has learned that the fund itself did not exist. He added that the budgeted amount of $650,000 is a conservative estimate if projects move forward. “Debt Repayment to the General Fund” marks the final payment of money allocated to get the Stormwater Utility started. Mr. Boucher expressed concern that expenses are being overstated. He noted an employee earning $100,000, but a department is being charged for his services to the department. Mr. Miller said it has to be shown that way because it is an enterprise fund. This is not occurring within the general fund. These expenses are also balanced by revenues. He felt this was an issue that could be discussed with the auditor. Mr. Rabidoux said a 31.2% rate increase is proposed to meet the Stormwater Utility’s obligations. Single family homes now pay $4.50 a month; the proposed rate is $5.94 per month. Mr. Miller noted that the city is proposing to switch banks which will get a lower interest rate for borrowing. He added that the Council has the option to consider whether the proposed surplus is too much, too little, or acceptable for all three funds. Mr. Boucher said his inclination is to reduce those just a bit. Ms. Emery said she would like to see all the figures on one page. Mr. Miller said he would ask the Council to authorize the $70,000 repayment into the special fund to address other transfer issues. Ms. Dooley suggested reducing this by $30,000. This would reduce the monthly fee to homeowners to $5.85. Mr. Boucher said that is still a 30% increase. Mr. Knapp noted that the Council also heard there will be a huge economic impact from new storm water MS-4 permit fees. He felt $100,000 is a reasonable number. Mr. Rusten said the goal is to try to get rates to where they feel they should have been this year. He did not anticipate these kinds of increases going forward. d. Waste Water: Mr. Rabidoux noted that funding for a Lab Technician position had been carried forward, but he did not anticipate that position being filled, so that money has been taken out of the budget. There is an estimated $57,000 reduction in chemical costs with the upgraded Airport Parkway plant. There is also an increase in gas expenses needed to run that plant. Sludge dewatering will be done in the plant and will not be contracted out as in the past. This results in a $200,000 reduction. They will be submitting an application to the state to go from Class B to Class A sludge, which can be applied anywhere. Mr. Miller noted they can’t budget for that, even though they feel quite certain they will get it. Mr. Rabidoux noted an increase in electricity at Airport Parkway and a reduction in electricity at the Bartlett Bay plant. One new vehicle is anticipated to respond to pump station calls. The existing vehicle is totaled. Regarding the “loan for Airport Parkway,” Mr. Miller said they have honed in on a shortfall in the range of $2,500,000. Options to address this include: borrowing from a commercial lender, going to the bond bank, or going to the state revolving fund and asking for an additional $2,500,000 borrowing. Any decision the Council makes will require voter approval. The item would be on the March ballot. At present, the higher bond bank rate has been budgeted. There will be a need to do interim borrowing so the contractor can be paid. The city has received one bid at a very favorable interest rate. They need to analyze how long to borrow the money for. Mr. Rabidoux then explained some of the revenues for the Waste Water Department including funds from 2 “pre­treating” customers, hook­up fees (an increase is proposed), and the Colchester revolving loan fund repayment (which kicks in FY2014). Mr. Miller stressed that revenues have been estimated very conservatively. He added that even with the increase in rates, the city is still below the midpoint in Chittenden County. Mr. Boucher said that if the rate increase begins with the final quarter of this fiscal year, almost all the deficit could be eliminated. Regarding the Colchester payment, Mr. Rabidoux noted that the Colchester rate does not contribute to the rolling surplus or to debt payment, but they do pay for the cost of running the system. Mr. Miller said they anticipate an increase in the rate charged to Colchester. There is still no agreement to replace the one that expired in 2006. e. Water Department: Mr. Miller noted that in this case the reserve funds are actually there because they were held by CWD. This money was used to pay cash for the work done on White Street this past year. He suggested a reserve fund for smaller projects. Mr. Rabidoux noted there will be an increase in the wholesale rate for water purchase. To cover this, an increase in the water rate of 10.68% is proposed. This will cost the average homeowner $22.15 a year more. This is less of an increase than the city is being charged. Mr. Boucher stressed this is much cheaper than well water. 2. Location of Town Meeting: Mr. Miller asked if members thought there should still be the “pot luck” pre­vote event. The Council unanimously felt there should. 3. Executive Session: Ms. Emery moved the Council meet in executive session to discuss personnel and contract negotiations and to resume regular session only for the purpose of adjournment. Mr. Knapp seconded. Motion passed unanimously. 4. Regular Session: Council returned to regular session. As there was no further business Mr. Knapp moved for Council adjournment. Ms. Dooley seconded. Motion passed unanimously. Council adjourned. _________________ Clerk Published by ClerkBase ©2019 by Clerkbase. No Claim to Original Government Works.