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HomeMy WebLinkAbout07-07-2015 workshop City Council of Peachtree City Workshop Minutes July 7, 2015 6:30 p.m. The Mayor and Council of Peachtree City met in workshop session on Tuesday, July 7, 2015, 6:30 p.m., at City Hall. Attending: Mayor Vanessa Fleisch, Council Members Terry Ernst, Eric lmker, Mike King, and Kim Learnard. The purpose of the workshop was to continue discussion of the FY 2016 budget. Fleisch reported that County Commissioner Pota Coston had passed away, adding the wake was scheduled on Friday, July 10, with the funeral service on Saturday, July 11. The City flag would remain at half-staff through the weekend. Interim City Manager Jon Rorie noted this was the third budget workshop and gave a brief snapshot of what had taken place to date. The budget options ranged from $33 million to $34 million. There would be no millage rate increase for FY 2016. The various levels of service options and initiatives represented an investment in the City's brand and infrastructure. The options included $79,000 for an additional detective position in the Police Department, $114,000 dedicated to merit increases for employees, $52,000 for an additional Safebuilt contract employee, $25,000 to reclassify a supervisor into a heavy equipment operator and to add an additional maintenance tech for the cart paths, and $180,000 in revenue for golf cart re- registration (approximately 12,000 carts) The FY 2016 Public Improvement Program (PIP) included $200,000 for bridge maintenance and $60,000 for maintenance on the City's timber bridges. The PIP did not include any Police Department vehicle replacements, but included routine vehicle and equipment replacements. Court software and routine network upgrades were included, as well as audio-visual upgrades in City Council Chambers and an equipment upgrade for Glenloch playground. Imker asked about the timber bridges. City Engineer Dave Borkowski said the City had heavy grade timber bridges, such as the golf cart bridge over Lake Peachtree on SR 54 and one behind Public Works. Rorie continued there were still decisions to make regarding paving service levels and discussed what the service levels meant, saying the City was trying to make up for $2 million in Special Purpose Local Option Sales Tax (SPLOST) funds it had received annually. The pieces of that included the miles of streets and paths that needed resurfacing and short-term traffic improvements for the intersections of MacDuff Parkway and Planterra Way on SR 54 West. Rorie said the target for street paving in FY 2016 was 5.65 miles at a cost of $1.84 million. Not all the streets would get full-depth reclamation (FDR), which provided some cost savings so more roads/patching/sealing on streets rated less than 80 could be done. There would be some flexibility for other demands. This would leave approximately 56 miles of streets rated below 80. Rorie discussed cart paths, noting approximately 10 miles were rated below 80. Nine miles of paths could be paved for $665,000, which meant an additional $225,000 needed to be 111 identified for additional supplies and materials. This fiscal year, approximately $440,000 had been budgeted. Rorie said some funding could be leftover this year. City Council Workshop Minutes July 7,2015 Page 2 Staff had three options for Council to consider, Rorie said. The first option had no millage rate increase with $2 million for paving and used $769,598 from Cash Reserves. The second option did not have a millage rate increase, included $2.2 million for paving, and used $1 million from Cash Reserves. The third option had a zero millage increase with $2.5 million in paving, using $1,333,098 from Cash Reserves. Rorie continued that a millage rate increase was programmed in FY 2017 in the three options - option one had a 0.250 mils increase, option two had a 0.350 mils increase, and option three had 0.500 mils programmed. Staff recommended Council consider the first option, Rorie said. It provided an extended opportunity to evaluate revenue streams [property taxes, title ad valorem tax (TAVT), sales tax, etc.]. The first option also protected the Cash Reserve fund balance. The recommended budget had $1.8 million to pave five miles of roads, plus some patching; $225,000 for cart paths offset by $180,000 in registration revenue; and $155,000 that could be dedicated to short-term traffic improvements, specifically the engineering plans for MacDuff Parkway/SR 54 and Planterra Way/SR 54 improvements. The first option also allowed for future contingency appropriations, which could be needed for storm response, emergency repairs, economic development initiatives, litigation expenses, short-term traffic improvements, and more. Financial Services Director Paul Salvatore said the same assumptions were used for each of the three options. They did not include employee raises, held the millage rate, and included the $15 per year golf cart registration fee. The $180,000 for the registration was based on collection of $45 for a three-year registration period. When the registration fees were prorated over the three- year period, the $225,000 for golf cart paving would only be offset by $60,000. The new detective position was also included. Option one was recommended, and had $2 million budgeted for street resurfacing. It had a 0.25 mil increase in FY 2017 projected. Historically, staff had budgeted $800,000 in Council Contingency and $200,000 in the Public Improvement Program (PIP). Since the recession, those contingencies were taken out of the budget, and the City had relied on Cash Reserves to pay for items that had come up. Salvatore said the models did not include any growth in Wilksmoor Village, but that would be an overlay on the models. Imker asked about the fair market value future assumptions. He said Salvatore's assumptions were conservative, which would give the City flexibility. He asked if those assumptions had a cost increase programmed in. Salvatore said the model included a 2.5% increase for FY 2017 and FY 2018 and 3% for FY 2019 and FY 2020. Imker asked if the PIP in the model included police cars and other equipment each year. Salvatore said it did. Imker said that was excellent. It would give Council flexibility to use the Cash Reserves for unanticipated items. Imker said Council could use more Cash Reserves next year and push the projected millage rate increase to FY 2018. He said Council should seriously consider this recommendation. Ernst asked where the funds for the $114,000 in merit pay would come from. Salvatore said the funds would come from holding off on filling the assistant police chief position and was not specifically appropriated. It was from employee savings. A full year had been budgeted for the position, including uniforms, benefits, etc., and holding off for six months would free up the funds. Salvatore continued that option two used $1 million in Cash Reserves, bringing the paving funds up to $2,235,000. The only difference was the projected 0.25 mil increase would be 0.35 mils. Every mile of road paving was equivalent to approximately $315,000. The fund balance levels were essentially the same as the first option. City Council Workshop Minutes July 7,2015 Page 3 Salvatore said the third option used $1.3 million from Cash Reserves. To offset that usage, a 0.5 mil increase was programmed in FY 2017. Each model had a progressively higher use of Cash Reserves. Staff preferred to not use the third option based on the last few years based on the money taken out of Cash Reserves. If another $800,000 was needed, that would mean using over $2 million from Cash Reserves. If revenues did not come in as projected, the problem would be exacerbated. A bigger millage rate increase would also be needed. Salvatore said the most conservative choice was the first option. In FY 2017 and FY 2018, staff would reevaluate everything, especially if there was the possibility of another SPLOST. Another issue for the proposed millage increase in FY 2017 was the City's policy on the use of one-time revenues. The Cash Reserves were being used to pay for an ongoing expense rather than a one-time expense, and staff did not want to use the Cash Reserves for regular expenses year after year. Imker said he agreed with that approach. The City currently had 10 miles of cart paths rated below 80, and this proposed budget addressed nearly all of those miles. While more miles would fall below 80, it would not be 10 miles, so the City would catch up fast on cart paths. Imker continued that he did not want to diminish the City's rating system for streets, but his subdivision street was rated at 85. A road rated at 75 was still usable, but was not as pretty. The proposed budget was just maintaining this level of service. lmker said he had a problem with just maintaining, but he also understood there were no SPLOST funds or an unlimited budget. Rorie agreed with lmker, saying the rating system was used nationally. Rorie said his position was 111 they had to identify the funding source, establish the plan, and build momentum from there. Imker said option one was a good approach. Fleisch opened the floor for comments from the public. Caren Russell had questions about the second option, saying if more streets were paved earlier then the cost would be cut. She asked if that would give the City any advantage in dealing with the Georgia Department of Transportation (GDOT) when it came to short-term traffic improvements. Rorie said they were separate issues. The first option would give the ability to get the engineering plans in place, and Council had already authorized the planning process. Russell asked if the second option gave the City any leeway to start working on improvements at the Planterra Way/SR 54 intersection at the same time work was going on at The Overlook, adding she would like Council to consider it since the improvements would also help to alleviate traffic on SR 54 West. Rorie said it would give Council the option to move forward on the improvements after the engineering plans were in place. No one else had any comments. The consensus of Council was to go with the first option, however; King preferred the second option. He noted there was an expected 7% increase in the tax digest after appeals, but the increase could be closer to 9.5% according to the County, although King felt it would be closer to 9%. Salvatore said, depending on how things were going, there would be more money for paving. If all those projections held, King asked if Council would consider putting more money towards paving. Learnard said they could talk about it at that time. Rorie said Council could always re-evaluate where things were. They need to make sure the revenue was there. City Council Workshop Minutes July 7,2015 Page 4 Fleisch asked, if the engineering plans for Planterra Way/SR 54 came back with short-term improvements, could Council look at it as a one-time investment and use Cash Reserves. Rorie said they needed to keep that on the table as a possible option. Rorie confirmed that the proposed budget would be the first option. King asked if the $180,000 from golf cart registrations would automatically go to cart path maintenance. Salvatore pointed out the $180,000 projected in golf cart registrations was General Fund revenue. There were other expenses such as patrolling the cart paths and the contract with Keep Peachtree City Beautiful to keep the paths clean, then the resurfacing. The registration fees were not earmarked specifically as special revenue. Rorie said even with that, the budget had approximately $1.7 million in costs and labor dedicated to cart path resurfacing. There being no further business to discuss, the meeting adjourned at 7:14 p.m. /, Pamela Dufresne, DAuty City Clerk Vanessa Fleisch, Vayor