HomeMy WebLinkAboutPackets - Council Packets (984) AGENDA
ORO VALLEY TOWN COUNCIL
BUDGET WORK SESSION
MAY 31, 2006
ORO VALLEY TOWN COUNCIL CHAMBERS
11,000 N. LA CANADA DRIVE
STUDY SESSION AT OR AFTER 5:30 PM
CALL TO ORDER: 5:30 PM
ROLL CALL
1. REVIEW OF MAY 25, 2006 BUDGET SESSION — FOLLOW-UP
MEMORANDUM
2. REVIEW OF CUMULATIVE BUDGET ADJUSTMENTS WORKSHEET
3. DISCUSSION REGARDING DEPARTMENTAL PERSONNEL
REQUEST AND FUNDING RESOURCES
4. DISCUSSION OF THE FINANCE AND BOND COMMITTEE'S RE-
RECOMMENDATION THAT COUNCIL CONSIDER AND APPROVE A
4% UTILITY TAX DURING FISCAL YEAR 2006/07
5. 2006/07 TENTATIVE BUDGET WRAP-UP
ADJOURNMENT
The Town of Oro Valley complies with the Americans with Disabilities Act (ADA).
If any person with a disability needs any type of accommodation, please notify
the Oro Valley Town Clerk, at 229-4700
POSTED: 05/26/06
4:45 p.m.
Ih
1
MEMORANDUM
DATE: May 26, 2006
TO: Honorable Mayor and Council
FROM: Chuck Sweet, Town Manager
David Andrews, Assistant Town Manager
Stacey Lemos, Finance Director
RE: Follow-up Issues from May 25th Budget Review Session
A number of issues were raised during the Mayor and Council's Budget Review Session
on May 25th. This memorandum serves as staff follow-up to these issues.
1) Issue: A rate reduction in the Public Safety Personnel Retirement System
(PSPRS).
Response: The PSPRS actuary has begun to recalculate employer
contribution rates for FY 2006-07. The adjusted rates will be available in mid-
June.
2) Issue: Cost benefit of moving Water Utility personnel to a leased facility.
Response: Staff will work with Water Utility to determine the cost and
feasibility of re-locating personnel to a leased location versus establishing
temporary operating facilities at the Municipal Operations Center site and
report back to Council prior to adoption of the tentative budget on June 21,
2006.
3) Issue: Adjust FY 2005/06 year-end estimates and FY 2006/07 Town
Manager requested budget for carry-forward capital projects.
Response: The adjustments have been reflected in the cumulative budget
adjustments worksheet.
I Stacey Lemos
Finance Director
'3›-ArviDgen
40 oc
David Andrews
Assist. t Town Manager
4114
Chuck Sweet
Town Manager
cc: All Department Heads
Bob Kovitz, Govt/Community Relations Admin.
2
TOWN OF ORO VALLEY
FY 2006/07 BUDGET
Council Line Item Changes
Through May 25, 2006
I Department/Division
Line Item I Increase/(Decrease)
GENERAL FUND;
Recurring:
Tow 1,623
n Council 2.3% Cost of Living Adjustment $
_ 47,451
Various Departments Department Heads Salary Market Adjustments
p 212 450
No Rate Increase in Health Care Benefits ( )
Various Departments $ (163,376)
Subtotal Recurring
Non-Recurring: 18,200
Safety (5) Fireproof storage cabinets $
Building Am
Parks & Recreation Increase lease expense forhi facilities 21,000 Amp
hi
Reduced LSTA grant (11,800)Custodial Utility tool truck bed 10,000
Car forward Economic Vitality Model costs 50,000
FinanceCarryforward
Finance Carryforward ERP system costs 125,000
Subtotal Non-Recurring $ 212,400
Total Council Adjustments -$ 49,024
Contingency Per Manager's Recommended $ 10,387,146
Total Council Adjustments (49,024)
Contingency Per Tentative Budget _ $ 10,338,122
HIGHWAY FUND
Recurring:
Department Heads Salary Market Adjustments $ 16,025
p
No Rate Increase in Health Care Benefits (36,093)
Subtotal Recurring $ (20,068)
Non-Recurring:
,Magee Road overlay $ 125,000
Lighted street signs along Oracle Rd. 80,000
Asphalt Patching Truck 80,000
Loan transfer to Roadway Impact Fee Fund 1,000,000
$ 1,285,000
Subtotal Non-Recurring
Total Councj
it Adjustments $ 1,264,932
-
-Contingency Per Manager's Recommended $ 2,872,307
Total Council Adjustments (1,264,932)
Contingency Per Tentative Budget _ $ 1,607,375
PUBLIC TRANSPORTATION
Recurring: _
No Rate Increase in Health Care Benefits $ (5,487)
Total Council Adjustments $ (5,487)
G:\BUDGET\FY 06-07\Council Line Item Changes
I DepartmentlDivision
Line Item I Increase/(Decrease)
ROADWAY IMPACT FEES
Non-Recurring: and $ (1,000,000)
Loan transfer from Highway F
Total Council Adjustments - $ (1,000,000)
Contingency Per Manager's Recommended $ 520,743
g Y
' Total Council Adjustments 1,000,000
Contingency Per Tentative Budget $ 1,520,743
9 Y
WATER UTILITY
Recurring: (31,772)
No Rate Increase in Health Care Benefits
Non-Recurring: 80,000
Carry forward costs for Sheraton D-Zone Booster _ $
-
Carry forward costs for Pusch Ridge Reservoir 50,000
Subtotal Non-Recurring $ 130,000
-
Total Council Adjustments $ 98,228
Contingency Per Manager's Recommended $ 1,915,523
g Y
Total Council Adjustments (98,228)
• Contingency Per Tentative Budget $ 1,817,295
9 Y
ALTERNATIVE WATER RESOURCES
Non-Recurring: - 187,100
Carry forward costs for Phase 1 In-line Booster _ $
Carry forward costs for Phase 2 Mains 196,850
$ 383,950
Total Council Adjustments
Contingency Per Manager's Recommended $ 675,526
g Y
Total Council Adjustments (383,950)
Contin enc Per Tentative Budget $ 291,576
_Contingency 1
I
W AT E R CONNECTION FEE S
Non-Recurring: 40,000
Carry forward costs for Stone Canyon H-Zone Mair $
Carry forward costs for WP#15 0.5MG Reservoir 75,000
Total Council Adjustments - $ 115,000
Contingency Per Manager's Recommended $ 6,507,573 Total Council Adjustments (115,000)
Contingency Per Tentative Budget $ 6,392,573
9 Y
STORMWATER UTILITY
Recurring:
Rate Increase in Health Care Benefits $ (605)
No (605)
Council Adjustments $
Total
G:\BUDGET\FY 06-07\Council Line Rem Changes
Departure
ntlDivision I Line Item Increase/(Decrease)
SPECIAL REVENUE FUNDS
Non-Recurring: reduction $ (900,000)
Honeybee Village Pima County bond proceeds500,000
y 2nd cycle of grant funding from Tohono O'dham _ $
Honeybee Village _ y $ (400,000)
Total Council Adjustments
G:\BUDGET\FY 06-07\Council Line Item Changes
•
SUGGESTED DIRECTION REGARDING FY 2006/07 CHANGES
Public Safety Personnel Retirement System (PSPRS) Employer Rate Reduction
Budget included the PSPRS actuarially-determined employer
The Town Manager's Recommendedg
• 11.86% FY 2006/07. Based on recently passed legislation extending the
matching rate of for r .
• PSPRS' unfunded liabilities, all members of the pension system can expect
amortization period of the
• to decrease by2%-3%. Oro Valley's exact reduction amount will not
their employer matching rates
be known until later in June.
• Savings with a 2% Reduction in the Matching Rate: $ 94,000
Potential General Fund g
Apply this savings amount toward the funding of Capital Improvements
Suggested Direction: pp y 9
• Fund, therebyincreasingthe General Fund Contingency by $94,000.
Projects (CIP) in the General
Adjustment of Bed Tax Rebate Commitments Budget Item
Within the Bed Tax Fund, an amount of $432,084 was budgeted in the Town Manager's
Recommended Budget for Bed Tax Rebate Commitments. This figure was calculated based on the
of Oro ValleyResolution (R) 05-35, which allocated specific portions of the
Iitera1 interpretation
Town's 6% bed tax revenues to various areas. Currently, though, only the Hilton El Conquistador has
Y
an approved bed sharing g
tax agreement with the Town of Oro Valley, which entitles the Hilton to a
2% of the total bed taxes generated by the Hilton only. This amount approximates
rebate of
$330,000 for FY 2006/07, therefore there is excess budget capacity in that line item of approximately
$102,000 ($432K9 total budgeted less $330K due to Hilton) that may be allocated elsewhere.
Bed Tax Fund Excess Allocation: $102,000
Apply this excess budget capacity to the Parks and Recreation section of
Suggested Direction: pp y g
the Bed Tax Fund forNaranjadevelopment.the Town Site develo ment. This would increase the Bed Tax Fund
budget for the Naranja Town Site by $102,000 to $426,063.
G:IBUDGEl1FY 06-071BudgetChangesDirection 5-31-06.doc
3
MEMORANDUM
DATE: May 26, 2006
TO: Honorable Mayor and Council
From: Chuck Sweet, Town Manager
David Andrews, Assistant Town Manager
Stacey Lemos, Finance Director
SUBJ: Discussion Regarding Departmental Personnel Request
Funding Resources
Please find attached the spreadsheet which captures the total cost of adding
additional personnel.
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f4&A 4
TOWN OF ORO VALLEY
COUNCIL COMMUNICATION
MEETING DATE: May 31, 2006
TO:• HONORABLE MAYOR & COUNCIL
FROM: Stacey Lemos, Finance Director
SUBJECT: Discussion of the Finance and Bond Committee's Recommendation that Council
a 4% Utility and Approve Tax During Fiscal Year 2006/07
SUMMARY:
. a May25th after the budget study session to
Finance and Bond Committee met last Thursday,
The F . The Committee members have attended
alternative revenue options for Fiscal Year 2006/07
discuss been expressed both by the Town
studysession and listened to the needs that have p •
each budget budget constraints that are facing the
Council and management staff and have taken a look at the
e needs, the Committee unanimously approved a motion
Town next fiscal year. To help address these
and approval of the 4% utility tax on natural gas, electricity
to re-recommend Council consideration pp g
and water utility services
Burin FY 2006/07 to provide funding for the following purposes:
• Public Safety
staffing and other critical staffing needs of the Town
• Recreation needs at the Naranja Town Site
• To mitigate current and future drawdowns on the General Fund's fund balance
that the utility Committee specifically recommended taxes generated from natural gas and
the purposes electricitybe allocated to the General Fund for
outlined above (with estimated annual
revenues of $1.5M) and that the utility taxes generated from the water utility service (annual revenues
• Town's Water Enterprise Fund to help supplement future
estimated at $400K) be allocated to the p °
not burdened byboth a base rate increase and a 4% tax
base rate increases so that customers are
increase on water services. Finally, the Committee recommended that the utility tax be revisited
beginto be
everytwo years as future sales tax revenues generated from the retail commercial
centers in Town.
SUGGESTED MOTION:
Council's Pleasure fed
yu��
Stacey Le s
F' ce Di ctor
C)21/41
David L. Andrews
Assistant Town Manager
/ Elf
Chuck Sweet
Town Manage
G:ISTACEYICouncil CommuniclUtil Tax Recomm by FBC 5-31-06.doc
RESOLUTION NO. (R) 01 - 28
A RESOLUTION OF THE MAYOR AND TOWN COUNCIL OF
THE TOWN OF ORO VALLEY, ARIZONA, RESCINDING
RESOLUTION NO. (R) 97-03 AND RE-ENACTING THE FISCAL
AND BUDGETARY POLICY FOR ADMINISTRATION OF THE
FINANCIAL OPERATIONS OF THE TOWN OF ORO VALLEY,
ARIZONA
WHEREAS, on January 21, 1997, the Council did approve Resolution No. (R)
97-03, which adopted a fiscal and budgetary policy for administration of the
financial operations of the Town of Oro Valley, Arizona, and;
WHEREAS, establishing and updating fiscally sound budgetary policies and
practices will enable the Town to achieve and maintain a long-term stable and
positive financial condition and;
WHEREAS, the process of developing fiscal and budgetary policies provides
guidelines to Town Management in planning and managing the Town's day-to-
day financial affairs and in developing recommendations to the Town Council,
and;
WHEREAS, publicity adopted policies contribute significantly to credibility and
confidence in government from the public and financial community, and;
WHEREAS, an explicit policy facilitates continuity in handling the Town's
financial affairs;
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND TOWN
COUNCIL OF THE TOWN OF ORO VALLEY, ARIZONA:
Section 1 —That Resolution No. (R)97-03 is hereby rescinded.
Section 2 — Balanced Budget The Town will develop an annual budget whereby
recurring Town revenues will be sufficient to support recurring operating
with no use of the General Fund contingency expenditures g y to support
ongoing operational expenses.
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Section 3 — Contingency Reserve The Town will maintain, at a minimum, a
20% of the
in the General Fund which
contingency reserverepresents
General Fund and Highway Fund's combined annual expenditures.
reserves in excess of the minimum may,
Contingency , at the Town Council's
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discretion be used to fund "one-time" non-recurring expenditures.
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Section 4 — Level of Authority The Town's annual budget shall be legally
adopted by the Town Council at the fund level, except in the General Fund,
C:\Documents and Settings\wgilden.OROVALLEY.000\My Documents\budgetary policy RES 01-281.doc
where it shall be adopted at the department level. To provide sufficient control
budgets shall be prepared and monitored by major
and accountability, g
expenditure categories (personnel, operations and maintenance, capital outlay,
debt service).
• Given that the provisions of Section 1 and
Section 5 — Service Level Funding
Section 2 of this
Resolution have been satisfied, every effort will be made to
maintain, at
a minimum, existinglevels of public services for the community.
Section 6 Lapsing Appropriations of A ro riations All budgetary appropriations that have not
been expended
or lawfullyencumbered shall lapse at the end of the fiscal year,
June 30. Appropriationscapitalprojects for in progress at fiscal year end shall
be made for the subsequent fiscal year.
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Section
7 — Budget Amendments and Transfers Because detailed budgets are
considered bythe Town to be a planning tool for department management,
departments g
should have some degree of flexibility in establishing and adjusting
such detail
includingmajorexpenditure categories (personnel, operations and
maintenance, capital outlay, debt service). To provide such flexibility, the
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following budget amendment and transfer provisions shall apply..
recommendation of the
Transfers between funds shall require the
A)
Town Manager and formal action by the Town Council.
B) Transfers between the line items within each major expenditure
permitted upon be u on recommendation of the Department Head and
approval by the Town Manager.
C) Transfers between the line items or major expenditure categories to
fund additionalpersonnel ersonnel or increased expenditures as a result of personnel
reclassifications shall require the recommendation of the Town Manager and
formal action by the Town Council.
Transfers between the operations and maintenance and capital
D) P
outlay major expenditure categories shall be permitted upon recommendation of
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the Department Head and approval by the Town Manager.
E) Transfers that would reduce or eliminate funding for items
in the adopted Capital Improvements Program shall require the
designatedp P
recommendation of the Town Manager and formal Council action.
F)
Transfers that would reduce or eliminate funding for debt service
shall require the recommendation of the Town Manager and formal Council
action.
Section 8 — Long-Range Forecasts The Town's annual budget shall include
revenue forecasts for the proposed current budget plus an additional two years to
test the ability of the Town to absorb expenditures and to react to changes in the
economy or service demands.
Section 9 — Performance Measurement The Town will minimize the financial
burden on its taxpayers by routinely evaluating both its administrative and direct
service delivery systems in terms of efficiency, effectiveness and
responsiveness. Technology will be utilized when feasible to increase efficiency
and cost-effectiveness.
Section 10 — Productivity Improvements The Town will promote the
understanding that its employees are its most valuable resource and will employ
sound management practices when planning for service delivery. The Town will
be committed to maintaining and improving the productivity of staff through a
pleasant working environment, appropriate equipment including office automation
and computer applications, necessary training and adequate supplies and
materials as resources and adopted policies permit.
PASSED, ADOPTED AND APPROVED by the Mayor and Town Council of the
Town of Oro Valley, Arizona, this 18th day of April , 2001
TOWN OF ORO VALLEY, ARIZONA
Paul H. Loomis, Mayor
ATTEST:
0= C.-
Kat n E. Cuvelier, Town Clerk
APPROVED AS TO FORM:
Dan Dudle, Town Attorney Y