City Council Special Meeting · Monday, October 22, 2018 · City Council Digest

2. PUBLIC HEARING

Proposed 2019 Budget: Levy and Revenue Sources AB 7611

Conduct Public Hearing · packet pp.3–15

Topics: Budget

Open packet at p.3 ↗

Staff report:

City Council / Tola Marts, Council President:

1746 segments .txt ↗

0:13 ↗ good evening and welcome to the council

0:16 ↗ committee work session for Monday

0:18 ↗ October 22nd this is the first of the

0:21 ↗ much-discussed long anticipated excited

0:24 ↗ budget 2019

0:27 ↗ budget deliberation conversations we

0:30 ↗ have three hours scheduled for this

0:32 ↗ evening we will be taking public comment

0:35 ↗ but because this is all sort of one big

0:38 ↗ presentation I am gonna take public

0:40 ↗ comment at the end so that's when that's

0:44 ↗ when we will be taking public comment

0:45 ↗ this evening so with that I am going to

0:48 ↗ turn it over to City Administrator moon

0:50 ↗ thank you happy to be here tonight was

0:54 ↗ so excited about talking about revenue

0:56 ↗ that I just jumped in on roofs public

0:59 ↗ hearing earlier to get right to the big

1:02 ↗ stuff we have two presentations that

1:05 ↗ we're gonna walk through tonight the

1:08 ↗ first is just to give some background on

1:13 ↗ council responsibilities are intense on

1:15 ↗ what we're going to present set the set

1:18 ↗ the table so to speak this is our

1:21 ↗ high-level schedule this is the schedule

1:24 ↗ that was presented in the budget and

1:25 ↗ brief document which is posted online

1:28 ↗ remind council that are more detailed

1:30 ↗ schedule was given to you on October 1st

1:34 ↗ and it attempts to lay out topics and

1:38 ↗ tentative if anticipated way for each

1:41 ↗ evening so you have a little bit more of

1:43 ↗ that information our ultimate goal is of

1:48 ↗ course we need to adopt the budget by

1:51 ↗ December 31st I also wanted to point out

1:54 ↗ on this slide that on November 5th where

1:58 ↗ it says first public hearing on

1:59 ↗ preliminary budget that we also

2:02 ↗ anticipate will include a moment in time

2:05 ↗ where we bring forward the salary

2:08 ↗ ordinance which will describe the

2:10 ↗ classifications and salary ranges and

2:13 ↗ we'd anticipate perhaps taking adoption

2:16 ↗ on that at the same date as the final

2:19 ↗ budget December 3rd

2:24 ↗ so a state law describes what we need to

2:28 ↗ give to you in the public in terms of a

2:31 ↗ budget on the revenue side we need to

2:33 ↗ provide actuals from the prior complete

2:36 ↗ year

2:37 ↗ that's 2017 we need to provide year an

2:40 ↗ estimate for the current year we're in

2:42 ↗ estimate for 2019 what we're

2:45 ↗ anticipating for revenues and we need to

2:47 ↗ more specifically include the ad valorem

2:50 ↗ and we reported on that earlier this

2:53 ↗ evening and also the unencumbered fund

2:56 ↗ balance on the expenditure side we are

3:01 ↗ required by state law to give you totals

3:04 ↗ for each fund and every department

3:05 ↗ within each fund and that data is to

3:09 ↗ include again actuals revised adopted

3:13 ↗ budget for the current year and the

3:15 ↗ proposed 2019 budget I mentioned we also

3:21 ↗ have to give you the salary or range of

3:24 ↗ costs for each classification and a

3:28 ↗ budget message which the mayor delivered

3:31 ↗ on last week

3:39 ↗ [Applause]

3:40 ↗ your key Birds that's gonna get me all

3:43 ↗ night long

3:44 ↗ state law also describes the final

3:48 ↗ budget as final form budget and that

3:51 ↗ style of budget needs to show the

3:53 ↗ estimated revenue and appropriations for

3:56 ↗ each separate fund and the aggregate

3:59 ↗ total the total city budget it includes

4:02 ↗ all funds and then at a high level it

4:05 ↗ describes the authority of the council

4:07 ↗ as being to approve the total amount

4:11 ↗ appropriated for each fund and that

4:13 ↗ that's what constitutes approved

4:15 ↗ expenditures and that's with regard

4:18 ↗ without regard to the individual items

4:20 ↗ that are within and so that's the

4:22 ↗ language that we're we often talk about

4:24 ↗ when we say that you have authority at

4:26 ↗ the fun level another term that we use

4:32 ↗ often yes I'm sorry to interrupt could

4:34 ↗ you please go back so the total amount

4:38 ↗ appropriated for each fund constitutes

4:39 ↗ the approved expenditures without regard

4:42 ↗ to the individual items contained

4:43 ↗ therein I want to make sure I understand

4:49 ↗ the intent of that comment I've always

4:51 ↗ viewed this as as there's really

4:54 ↗ multiple components to the budget of

4:56 ↗ course there is what you talked about

4:57 ↗ here in the appropriations per fund then

5:00 ↗ and of course we caná-- summarize that

5:02 ↗ in one page yes but our budget documents

5:04 ↗ are 190 pages correct and there is a lot

5:07 ↗ of background information but there's

5:09 ↗ also there's also there's workplane

5:10 ↗ information just staffing information

5:12 ↗ there are capital projects in there and

5:16 ↗ outside of the fund balance

5:17 ↗ appropriations I've always viewed all of

5:21 ↗ these other elements and many that I

5:22 ↗ didn't mention as as as as policy budget

5:28 ↗ policy and and so though there's a

5:33 ↗ technicality that we only approve an

5:35 ↗ appropriation at the fun level but in

5:38 ↗ essence though we are also adopting

5:40 ↗ quite a bit of policy absolutely

5:41 ↗ absolutely and and again this is just

5:45 ↗ what the state law says in this section

5:47 ↗ on the budget there are other

5:49 ↗ that require you to to actually approve

5:51 ↗ of different kinds of expenditures you

5:55 ↗ know land transactions those sorts of

5:57 ↗ things so there's other state laws of

5:58 ↗ reference individual Authority and

6:01 ↗ appropriations so this was overly

6:05 ↗ simplified and having said that yes we

6:07 ↗ still provide you with a whole lot more

6:09 ↗ information because we know in order to

6:11 ↗ make good decisions in the macro you

6:14 ↗ need to also understand the bits and

6:16 ↗ pieces that comprise the whole and it

6:20 ↗ sets direction for the city and our

6:22 ↗ delivery of services absolutely

6:26 ↗ so a couple terms if we talk about a

6:30 ↗ balanced budget there's a couple ways

6:32 ↗ state defines this term per state law

6:36 ↗ it's when appropriations are limited to

6:39 ↗ the total estimated revenues including

6:42 ↗ the unencumbered fund balance so it says

6:45 ↗ you may use savings from prior years and

6:49 ↗ if you do it still constitutes a

6:52 ↗ balanced budget however what we aim to

6:55 ↗ develop every year is what we would call

6:57 ↗ a structurally balanced budget and that

7:00 ↗ is also defined in state statute and

7:02 ↗ it's when all of our ongoing expenses

7:05 ↗ are met by recurring revenues so we

7:07 ↗ don't rely on fund balance still we have

7:12 ↗ opportunities to use fund balance for

7:14 ↗ one-time appropriations and that is an

7:19 ↗ absolutely fine way to fund many

7:21 ↗ one-time items and state law says you

7:28 ↗ should conduct a couple hearings three

7:30 ↗ hearings actually and establish our

7:32 ↗ property rate prove those salary ranges

7:35 ↗ and classifications and adopt that final

7:37 ↗ form budget however because it is policy

7:43 ↗ based as well we have desired actions

7:46 ↗ that we usually take you through every

7:48 ↗ budget season these are the desired

7:50 ↗ actions from the point of view of mayor

7:53 ↗ and city administration so the first is

7:56 ↗ we like to review in depth estimated

7:58 ↗ revenues this

8:00 ↗ plans for the funds and departments we

8:03 ↗ like to highlight the major changes

8:06 ↗ because we looked at every little detail

8:08 ↗ the budget there's changes in multiple

8:11 ↗ places and we have a policy question in

8:15 ↗ front of you in this budget and that's

8:16 ↗ what the operational model should be for

8:19 ↗ the senior center going forward we're

8:21 ↗ going to talk about that in a later

8:22 ↗ budget work session as well as the 2019

8:27 ↗ capital projects we have some unfunded

8:28 ↗ projects we have some projects that are

8:30 ↗ planned for year one in our CIP which

8:33 ↗ will now be 2019 and the mayor and I

8:38 ↗ have recommended an increase to the

8:39 ↗ Hart's Housing Trust Fund contribution

8:42 ↗ and I had said during budget

8:43 ↗ deliberations we'd come back to that and

8:45 ↗ have that conversation some other

8:49 ↗ desired actions are to review the work

8:51 ↗ plan we're going to cover items that are

8:53 ↗ in it and some items that were left out

8:55 ↗ this year we had a confined budget we

9:00 ↗ had a limited amount of new revenue and

9:01 ↗ that worst us to make some decisions

9:06 ↗ about which projects we would pursue

9:09 ↗ they're also asking to present the

9:13 ↗ staffing needs that we have and asking

9:16 ↗ for your support for our staffing

9:18 ↗ recommendations we're looking to review

9:21 ↗ the city gives funding that's Community

9:24 ↗ Fund Human Services grants some other

9:28 ↗ other ways in which we contribute to

9:30 ↗ local nonprofits in particular and

9:34 ↗ asking you to approve those

9:36 ↗ recommendations we will discuss the

9:40 ↗ possible use of general fund fund

9:42 ↗ balance and this budget did not utilize

9:45 ↗ any and we'll talk a little bit at the

9:48 ↗ end about our 2019 plan to analyze some

9:53 ↗ of the design of our funds move forward

9:56 ↗ on more cost allocation and move funds

10:00 ↗ in the direction of greater

10:01 ↗ sustainability so overall this is our

10:08 ↗ plan for the presentations going forward

10:10 ↗ we're going to spend time on revenues

10:12 ↗ we're going to review fund into

10:14 ↗ Herman totals and I highlight the big

10:16 ↗ things in the budget we're gonna talk

10:19 ↗ about the mayor's people and tools

10:21 ↗ strategy which was the framework for our

10:23 ↗ budget development and talk about 2019

10:26 ↗ let's plan and how that fits with our

10:29 ↗ long-range planning model and those

10:33 ↗ areas that it appears are going to need

10:35 ↗ more attention going forward into the

10:38 ↗ next year so that's first presentation

10:49 ↗ we're moving to the second one any

10:53 ↗ questions so far

10:54 ↗ they're questions

11:01 ↗ should be a folder on the desktop okay

11:13 ↗ so the second presentation that we're

11:16 ↗ gonna make tonight is more meaty in

11:20 ↗ terms of turning our attention to

11:22 ↗ numbers and nope which one do I do close

11:29 ↗ master view where's that uh oops back

11:35 ↗ live master over on the right hand side

11:37 ↗ there's a red there nope okay good

11:42 ↗ thanks Lisa

11:51 ↗ thank you okay and as Christina gets

11:57 ↗ seated and the first thing that we're

11:59 ↗ gonna do is talk a little bit about

12:01 ↗ what's new and different this year in

12:04 ↗ terms of our process and budget formats

12:07 ↗ so I'm going to turn it over to

12:09 ↗ Christina eller I'm Christina eller one

12:17 ↗ of the financial operations managers I

12:20 ↗ wanted to take a moment to walk you

12:22 ↗ through what the budget process has look

12:25 ↗ like Moon's going to look like this is a

12:27 ↗ multi-step multi-year journey to improve

12:31 ↗ the budget process we are looking at

12:35 ↗ setting up a process with best practices

12:39 ↗ policies and procedures that contribute

12:42 ↗ to improve our government management

12:45 ↗ part of that has included the department

12:47 ↗ restructure which has aligned our

12:51 ↗ accounting division the revenue division

12:54 ↗ and budgeting division to better align

12:57 ↗ with some of those services to enhance

13:00 ↗ and utilize our expertise and it will

13:05 ↗ allow us to better align with the

13:07 ↗ strategic plan as that comes to

13:09 ↗ completion

13:10 ↗ early next year we've also implemented

13:13 ↗ new software that's included the

13:16 ↗ financial system and also in progress is

13:18 ↗ our new budget development system West

13:21 ↗ ouka and that will allow us in time to

13:26 ↗ also align with our strategic plan and

13:27 ↗ we'll be able to tie some of these new

13:30 ↗ strategic initiatives along with the

13:35 ↗ plan part of best practices has allowed

13:40 ↗ us the opportunity opportunity to

13:44 ↗ restructure our chart of accounts this

13:46 ↗ has been a two-fold process what we

13:49 ↗ started a few years ago with

13:51 ↗ restructuring from a long account to a

13:54 ↗ short account I believe that we went

13:57 ↗ from 10

13:58 ↗ and accounts down to three we still in

14:02 ↗ this last year went through another

14:04 ↗ restructuring and that was to align with

14:07 ↗ our reporting that is regulated by bars

14:11 ↗ our state mandate that allows us to it's

14:18 ↗ better reporting and we've been able to

14:21 ↗ follow the federal and state

14:22 ↗ requirements for cost allocation setting

14:26 ↗ up for cost allocation and the accrual

14:30 ↗ method of accounting was established

14:34 ↗ three or four years ago we went from

14:36 ↗ cash basis to accrual basis this new

14:43 ↗ format in finance has given us the

14:46 ↗ opportunity to have better perspective

14:52 ↗ with long range planning to work more

14:54 ↗ with the Finance Committee ad hoc

14:56 ↗ committee long range planning it's been

15:01 ↗ it allowed us time to comply with fiscal

15:03 ↗ policy allow more interdepartmental

15:06 ↗ collaboration and will allow us more

15:10 ↗ engagement with with the departments but

15:13 ↗ also with the community we've been able

15:16 ↗ to adopt a five-year CIP and including

15:20 ↗ the first two years in a biennial budget

15:22 ↗ that's allowed us in this off year to do

15:25 ↗ the chart of accounts and do some of

15:27 ↗ that extra work we were able to work

15:32 ↗ with IT to fund the IT this is the new

15:37 ↗ internal server and internal service

15:39 ↗ it's a new internal service fund for IT

15:41 ↗ and develop the cost allocation plan and

15:44 ↗ we'll further that development through

15:46 ↗ we'll talk about it later in the

15:48 ↗ workshops but with fleet and refined

15:52 ↗ some of those allocations with other

15:53 ↗ other areas part of what you'll see in

15:58 ↗ this new process is a new document our

16:02 ↗ previous historical documents have been

16:06 ↗ very manual and

16:08 ↗ although useful and we want to

16:10 ↗ contribute and continue some of those

16:12 ↗ informative pieces we're looking to use

16:15 ↗ the the system have the departments

16:19 ↗ utilize the system get the information

16:21 ↗ out to them faster help with management

16:25 ↗ decisions executive decisions and get

16:27 ↗ that turnaround time a little faster and

16:29 ↗ a little more deliberate a little more

16:31 ↗ strategic in many ways so you'll see

16:35 ↗ some of our standardization has included

16:37 ↗ terminology we're talking about the

16:40 ↗ preliminary budget which has had

16:42 ↗ different forms and terms in the past

16:44 ↗ like draft or proposed we've tried to

16:47 ↗ simplify it it may not look like it's

16:49 ↗ simplified but it is it's also allowing

16:54 ↗ us as we go through this process we will

16:57 ↗ have the opportunity to have what's

17:00 ↗ called open book it's more interactive

17:02 ↗ its outward facing and you can engage

17:07 ↗ different levels of the community

17:09 ↗ different levels of the organization so

17:11 ↗ we're looking forward to that it also

17:13 ↗ has a component of performance metrics

17:15 ↗ performance management we're looking

17:18 ↗ forward to that component and getting

17:20 ↗ that in but you know as part of our

17:21 ↗ normal city of Issaquah process it's

17:27 ↗ giving us a different level of

17:29 ↗ organizational reporting and feedback

17:31 ↗ and it's giving us a process for review

17:35 ↗ and part of that is here with counsel

17:39 ↗ and the workshops and being being able

17:43 ↗ to provide different levels of

17:45 ↗ information to you so we look forward to

17:51 ↗ this process and

17:56 ↗ questions so far remember winter Stein I

18:02 ↗ may be ahead of the game so I'm sure

18:04 ↗ you'll tell me if I am at what point are

18:05 ↗ you going to explain

18:10 ↗ I'll use the multi org summary structure

18:17 ↗ that's in the book preliminary budget

18:19 ↗ document so reading we can talk about

18:21 ↗ that a little bit would you like to do

18:22 ↗ that that is part of was the long

18:27 ↗ account went to a short account which is

18:30 ↗ the org code it's basically I don't want

18:33 ↗ to call it a costing center but it is an

18:35 ↗ organizational component it there can be

18:40 ↗ several organization codes in a

18:43 ↗ department amar it's it's the difference

18:48 ↗ between some our departments and some

18:49 ↗ our funds themselves but it is based on

18:54 ↗ funds there at that okay so the org

19:01 ↗ summary is is will align and help align

19:05 ↗ with a strategic plan so they should be

19:08 ↗ standalone okay no I think I might know

19:13 ↗ enough to understand that you change the

19:15 ↗ chart of accounts the we have a cost

19:17 ↗ Center and it sounds like you have a org

19:19 ↗ component as well maybe that's another

19:20 ↗ segment or not maybe it's within that

19:23 ↗ how it so but this is now what's

19:25 ↗ reflected in this reporting I can see

19:26 ↗ that you've done the budget using that

19:28 ↗ new structure yeah we don't even need to

19:30 ↗ compare it against its we can't it's you

19:33 ↗ can't and it go back and see the same

19:37 ↗ level of information now into you know

19:41 ↗ year-over-year comparison so I'm not

19:44 ↗ asking that you make that possible but

19:46 ↗ but I do we'll need as we go through

19:51 ↗ this some help on help because last few

19:55 ↗ years is the basis that we have and with

19:58 ↗ this new structure and the way this data

20:00 ↗ is now broken out

20:01 ↗ we can't go we don't have a ready

20:04 ↗ comparison to previous years at all

20:06 ↗ this level I leave you have something

20:11 ↗ pretty close so instead of looking at

20:13 ↗ the pages that are marked org

20:16 ↗ multiple org summary is a lovely

20:19 ↗ descriptive header that cuesta chi gave

20:21 ↗ us you can instead look at the budget

20:26 ↗ expenditure Harrison summary which is

20:29 ↗ organized in the same fashion that we

20:31 ↗ have done before so you can look at city

20:34 ↗ clerk city facilities there are if you

20:38 ↗ go back further than 2017 actuals that

20:43 ↗ we gave you then yes that will be a

20:44 ↗ little bit more complicated and I'll

20:46 ↗ give you an example of that we've

20:49 ↗ renamed some functions in order to get

20:53 ↗ them into sort of these cost allocation

20:55 ↗ buckets but we can help show you a map

21:00 ↗ for that but we've given you at least

21:02 ↗ the ability to compare the 2018 budget

21:05 ↗ and the 2017 actuals with what's

21:08 ↗ proposed for 2019 okay so thank you so

21:10 ↗ that's starting on page five titled the

21:12 ↗ budget expenditure comparison summary

21:14 ↗ and correct and and since you brought

21:16 ↗ that up

21:17 ↗ city of the V I don't know what you're

21:21 ↗ going to call these departments slash

21:23 ↗ funds but within these city facilities

21:26 ↗ I'm going to list a couple of them off

21:28 ↗ here and I can give them to you via

21:29 ↗ email city facilities non-departmental

21:34 ↗ emergency management streets and special

21:38 ↗ revenue funds debt service capital

21:40 ↗ projects internal service those don't

21:43 ↗ map back to last year correct that's

21:47 ↗ where you have different titles whether

21:49 ↗ they combine some groups and some pieces

21:52 ↗ emergency management for example was a

21:54 ↗ division or indirect Public Works ops

21:56 ↗ okay so so that that's the kind of help

22:00 ↗ I'm going to ask okay if you've I

22:02 ↗ recognize that there was some

22:03 ↗ reorganization restructure recoding that

22:05 ↗ was done we're seeing it all in the new

22:07 ↗ structure but I need even at this

22:09 ↗ summary level starting on page five

22:11 ↗ right but as I tried to go back and I

22:13 ↗ just pulled up last year's budget

22:15 ↗ document yes many those organizations

22:17 ↗ are there but this is clearly is a blend

22:19 ↗ of

22:19 ↗ as Christine mentioned some funds and

22:22 ↗ some departments sure so what we could

22:25 ↗ do is we could give you that we could

22:27 ↗ map these new units to where they were

22:31 ↗ budgeted before what may be more

22:33 ↗ difficult for us is to take past year's

22:37 ↗ budgets and then break them into these

22:39 ↗ new parts and and I know that's very

22:42 ↗ difficult to do when you've recoded

22:44 ↗ Thanks so I'm mapping at this point is

22:47 ↗ all I would ask for great thank you

22:51 ↗ other questions right now thank you

22:56 ↗ please proceed

22:57 ↗ all right so tonight we're gonna focus

22:59 ↗ on the general fund this is a year-end

23:04 ↗ kind of snapshot showing what we have is

23:07 ↗ the originally adopted budget and we

23:10 ↗ brought forward a budget amendment

23:12 ↗ amendment in August and that and then we

23:16 ↗ asked departments to estimate where

23:17 ↗ they're going to be at your end

23:19 ↗ I will tell you that is their best guess

23:21 ↗ we have some departments that do an

23:23 ↗ excellent job at that guesswork and we

23:26 ↗ have others that were growing their

23:28 ↗ sophistication and helping to create

23:31 ↗ those year-end estimates I tell you that

23:34 ↗ because we we then utilize a snapshot

23:38 ↗ like that to look at fund balance and

23:42 ↗ fund balances it changes every day it's

23:47 ↗ wholly dependent on what we are

23:49 ↗ receiving in revenue and what we're

23:51 ↗ expending and that does change over time

23:54 ↗ so right now in this budget we are

23:58 ↗ forecasting that our revenues are going

24:02 ↗ to be better than expected and budgeted

24:05 ↗ by 2.3 1 million dollars and our

24:08 ↗ expenditures are going to be less than

24:11 ↗ what we expected by four point four four

24:14 ↗ million dollars I will tell you that

24:19 ↗ four point four four is eight and a half

24:22 ↗ percent on top of the is eight and a

24:25 ↗ half percent of what the amended budget

24:27 ↗ was for expenditures that's a fairly

24:30 ↗ high return to fund balance

24:32 ↗ in my book and again still a product of

24:36 ↗ where departments believe they're going

24:39 ↗ to end the year I expect that will

24:41 ↗ change some can't say which way positive

24:45 ↗ or negatively but we are going to go

24:50 ↗ through an effort that's coming here to

24:52 ↗ again get better at doing those

24:54 ↗ estimations but also at looking at our

24:58 ↗ expenditures throughout the year so that

25:00 ↗ we're better able to understand what we

25:04 ↗ may need to bring back to you in a

25:05 ↗ budget amendment and what we may not

25:07 ↗ need to and there were things in the

25:09 ↗ August amendment that we held back

25:11 ↗ because we could clearly see that we had

25:14 ↗ the capacity to fund those things and so

25:17 ↗ they weren't part of the budget

25:18 ↗ amendments we're making progress if you

25:22 ↗ look at the bottom chart there we

25:25 ↗ started the year we I'm sorry in August

25:31 ↗ during the retreat we had estimated the

25:35 ↗ ending fund balance for 2018 to be

25:38 ↗ sixteen point seven million dollars if

25:40 ↗ you add on top of that the return to

25:42 ↗ fund balance that we're anticipating now

25:45 ↗ that would give us a beginning fund

25:48 ↗ balance for 2019 of twenty-three point

25:51 ↗ four six million dollars that is a multi

25:55 ↗ unbalanced I'm sorry

26:09 ↗ just to be clear that's kind of like a

26:12 ↗ positive name so the four point five

26:14 ↗ percent is an increase over expected

26:16 ↗ revenue and this eight point five

26:18 ↗ percent is a decrease in expenditures of

26:21 ↗ what was expected right yes so they're

26:26 ↗ both looking like positive numbers but

26:27 ↗ they're kind of in a sense it's two

26:29 ↗ different ends of the spectrum right

26:30 ↗ correct it's actually the it's taking in

26:34 ↗ the case of the four point four four

26:38 ↗ it's taking the 52 million dollars that

26:41 ↗ was amended budget and it's saying what

26:44 ↗ percent spend that is returning to fun

26:48 ↗ bounds and that's that's the eight point

26:51 ↗ five right so we spent eight point five

26:52 ↗ percent less than anticipated less we

26:55 ↗ got more revenue four point five percent

26:57 ↗ more than anticipated so that's where

26:59 ↗ that six million dollars got to be a

27:01 ↗ pretty big number because we're adding

27:03 ↗ those together that's all I'm just

27:04 ↗ trying to say so it doesn't look like

27:05 ↗ they're both pluses are both minuses

27:07 ↗ right no they don't balance each other

27:09 ↗ out

27:09 ↗ they actually crack to each other

27:11 ↗ correct that's why the two point three

27:13 ↗ and a four point four add up to six

27:14 ↗ point seven five correct

27:15 ↗ great thank you just clarify yeah we're

27:19 ↗ gonna spend more time in a subsequent

27:22 ↗ presentation on actually next Monday

27:24 ↗ talking about the return to fund balance

27:26 ↗ and we're gonna break that down for you

27:28 ↗ a little bit more on the expenditure

27:30 ↗ side what I can say about that two point

27:32 ↗ three one return to fund balance on the

27:34 ↗ revenue side it's largely from two

27:37 ↗ places its property tax so increased

27:39 ↗ valuations new construction additional

27:43 ↗ value in there for additional tax that's

27:45 ↗ coming to the city and sales and use tax

27:49 ↗ so higher than expected sales and use

27:53 ↗ tax revenue a little lesser extent

27:56 ↗ coming from utility tax and building

27:58 ↗ permanence this is just my graphic to

28:05 ↗ illustrate that fund balance does change

28:07 ↗ over time I wanted to give you just an

28:12 ↗ example of this at the end of the budget

28:15 ↗ season in 2016 as we were adopting the

28:18 ↗ 2017 budget our beginning fund balance

28:21 ↗ was 15 million dollars a year from that

28:24 ↗ point we came back together and we're

28:26 ↗ ready to adopt the 2018 budget and at

28:29 ↗ that point we projected the 2017 ending

28:32 ↗ fund balance 1.5 million dollars higher

28:35 ↗ we had the retreat in August and we

28:39 ↗ looked at 2017 actual fund balance and

28:42 ↗ it was 18 million dollars

28:44 ↗ and and so on and so this is just meant

28:47 ↗ to illustrate that fund balance is on

28:51 ↗ the move

28:52 ↗ it's unmoving I think a good directions

28:54 ↗ going up that's it shows the health of

28:58 ↗ the city and our local economy but it's

29:04 ↗ a snapshot in time it changes every time

29:06 ↗ we take a look at it and do that math to

29:08 ↗ look at expenditures and revenues so

29:15 ↗ here's just a little bit more of that

29:18 ↗ general fund return to fund balance

29:20 ↗ broken down we look at the increased

29:23 ↗ revenue I spoke about this already

29:25 ↗ property tax sales and use one other

29:29 ↗ pieces I didn't mentioned earlier was

29:31 ↗ unanticipated grant revenue I think this

29:34 ↗ was the result of a parks capital

29:37 ↗ project that I believe probably was

29:42 ↗ anticipated but not fully recorded

29:45 ↗ within the budget at the time of

29:46 ↗ adoption and so we were off by that and

29:50 ↗ then on the under expenditures you can

29:54 ↗ see that half of that came from position

29:58 ↗ vacancies or as we filled positions if

30:03 ↗ we hired a less experienced more junior

30:07 ↗ person into a position where we had a

30:09 ↗ retirement of a more senior person they

30:11 ↗ may have started on the our pay scale at

30:13 ↗ a at a lower place we also had

30:17 ↗ professional services in our budget that

30:20 ↗ we under expended that sometimes is

30:23 ↗ because we got bids that were less we

30:26 ↗ were able to do the project for less

30:28 ↗ than we had thought or we didn't

30:31 ↗ complete a project and that project

30:35 ↗ either got done in-house or we may be

30:39 ↗ asking for it to be reappropriation 2019

30:42 ↗ and we'll we'll talk about those

30:43 ↗ projects in the next budget meeting I

30:46 ↗ think comes from a raise so can I just

30:49 ↗ get some clarification I don't need it

30:50 ↗ tonight but at some point I can find the

30:52 ↗ property tax change I can find the

30:53 ↗ retail sales

30:55 ↗ tax change I'm having a difficult time

30:56 ↗ in the detail finding the unanticipated

30:58 ↗ grant revenue and just like to be able

31:00 ↗ to understand where that's coming from

31:02 ↗ that would be very helpful thank you

31:03 ↗ absolutely next I'm sorry another

31:10 ↗ question from County Council deputy

31:12 ↗ president patisserie thank you

31:15 ↗ I just with the retail sales and use tax

31:18 ↗ just having that be a little bit

31:20 ↗ unexpected did you say that was sort of

31:22 ↗ on the use tax side of things was there

31:26 ↗ I was just wandering through it was any

31:28 ↗ more information and we can examine that

31:32 ↗ and see if we can get better detail I

31:34 ↗ just have it is the whole category okay

31:36 ↗ thank you

31:39 ↗ it's procedure thank you okay so this is

31:43 ↗ a breakdown of the entire budget by by

31:46 ↗ fund sort of the same same information

31:49 ↗ we've talked about with general fund and

31:53 ↗ you can see the amended budget for each

31:57 ↗ funds take water at the top there where

32:00 ↗ we're projecting to end the year that's

32:03 ↗ the variance and then on the right hand

32:06 ↗ side you can see bfb is beginning fund

32:09 ↗ balance so you can see where we started

32:12 ↗ with the fun at the beginning of this

32:14 ↗ budget year and then the projected

32:18 ↗ increase or decrease to that fund

32:20 ↗ balance based on revenues and

32:23 ↗ expenditures throughout the year and

32:25 ↗ also based on where we actually began

32:30 ↗ 2018 year and fund balance as opposed to

32:33 ↗ maybe just the adopted anticipated start

32:37 ↗ of fund balance for that fund and then

32:40 ↗ you can see how that results in the 2019

32:43 ↗ beginning fund balance which is shown in

32:46 ↗ your preliminary budget times I'm never

32:50 ↗ ray so just picking on water for just a

32:52 ↗ second so if I'm reading this correctly

32:54 ↗ and I'm not saying that I am we had one

32:58 ↗ point seven five seven million dollars

33:00 ↗ more in revenue than we anticipated and

33:02 ↗ we had

33:03 ↗ expenditures of $30,000 more than we

33:06 ↗ anticipated how did we end up with a

33:08 ↗ negative in projected increase or

33:11 ↗ decrease I would think we'd have a

33:12 ↗ positive yes again this is I think what

33:17 ↗ we probably should have given you is the

33:19 ↗ revised beginning fund balance for 2018

33:22 ↗ I think that's the difference that

33:24 ↗ perhaps that twelve million dollars was

33:26 ↗ the beginning fund balance where we were

33:29 ↗ when we adopted the budget and where

33:31 ↗ we're actually at now in the anticipated

33:34 ↗ fund balance for that fund then you

33:39 ↗ bring in those budget variances from

33:41 ↗ revenue and expenditures and you arrive

33:42 ↗ at the if you could just make the math

33:54 ↗ foot for me somehow weekly so we can

33:56 ↗ work on that sure and I appreciate this

34:00 ↗ new format in terms of where the

34:03 ↗ information is located and and I maybe

34:05 ↗ my fellow council members would disagree

34:07 ↗ but I personally would be easier if if

34:12 ↗ increases in a fund positive to fund is

34:15 ↗ positive and negative to fund is got

34:17 ↗ parentheses of it just charity okay

34:20 ↗ really really good yeah I think the the

34:23 ↗ big takeaway is that column on that for

34:25 ↗ our left of the amended budget it would

34:27 ↗ probably be helpful for us to show you

34:29 ↗ what the original adopted was because

34:32 ↗ that's that's a piece that's kind of

34:34 ↗ missing at this point of the story okay

34:38 ↗ and then we've also given you the big

34:43 ↗ macro views on these funds as well

34:46 ↗ street operating which is largely funded

34:48 ↗ through general fund type revenue

34:51 ↗ sources and a couple more utility funds

34:53 ↗ here sewer and stormwater you will see

34:58 ↗ and some of these funds where we have an

35:02 ↗ anticipated decrease to the fund balance

35:06 ↗ will be coming back to those funds in

35:09 ↗ your work session in Nova

35:11 ↗ to talk about what that means

35:15 ↗ long term some of these funds all the

35:19 ↗ sewer and stormwater for example on this

35:22 ↗ page are mixed operating in capital

35:25 ↗ funds now you'll recall we combined

35:27 ↗ those last year and so in some cases

35:30 ↗ we're taking from fund balance in order

35:33 ↗ to pre-fund projects on the capital side

35:35 ↗ yeah I would be particularly interested

35:38 ↗ when we have that conversation to

35:39 ↗ understand to what extent we've been

35:41 ↗ unable to execute our capital spend the

35:44 ↗ way that that we hope to and what's

35:46 ↗ going on with that and how it might look

35:48 ↗ different in 2019 questions all right

35:54 ↗ I'm moving from looking in the rearview

35:56 ↗ mirror I'm looking forward to 2019

36:00 ↗ mayor's budget focus at the start of the

36:04 ↗ budget was for us as staff to ensure

36:08 ↗ that we could maintain service levels

36:12 ↗ and quality of service and the direction

36:16 ↗ was to limit new requests and the reason

36:18 ↗ for that is because we're undertaking

36:22 ↗ strategic plan right at this moment and

36:24 ↗ we want to have that framework in mind

36:27 ↗ before we start major initiatives new

36:31 ↗ programs or service areas and so she she

36:35 ↗ said this is a maintenance budget this

36:37 ↗ is sort of a roll forward budget let's

36:39 ↗ do what we're doing and let's do it as

36:41 ↗ well as we can in 2019 but let's not

36:43 ↗ take on major new things

36:45 ↗ having said that mayor also became aware

36:49 ↗ of needs needs in terms of additional

36:52 ↗ staffing and additional resources for

36:56 ↗ staff so she called it her people in

36:59 ↗ tools focus and we'll talk more about

37:01 ↗ that particularly next workshop but that

37:05 ↗ was the framework that staff members

37:08 ↗ used as we developed the budget we

37:12 ↗ wanted to talk to you just a little bit

37:14 ↗ about the tool or the people side of

37:18 ↗ this framework and we wanted to share a

37:21 ↗ little staffing history with you this is

37:25 ↗ the reason why departments asked for

37:29 ↗ certain number of positions and why the

37:32 ↗ mayor chose to include some new staffing

37:34 ↗ in her proposed budget this is only

37:37 ↗ meant to illustrate history it's not

37:40 ↗ meant to describe what should have been

37:44 ↗ or what could have been and so

37:47 ↗ illustrative only the trend line versus

37:53 ↗ actual graph displays both the

37:55 ↗ authorized FTE numbers for city staff

37:58 ↗ and a projection based on historical

38:01 ↗ data authorized up T's does not equate

38:07 ↗ to the number that you might see in a

38:10 ↗ budget we've taken a look and tried to

38:13 ↗ combine in past years limited term

38:17 ↗ employees so LTS with FTEs and you'll

38:21 ↗ recall only a couple years ago we

38:22 ↗ started breaking out LTS from FTEs in a

38:26 ↗ way that you could track both pools

38:31 ↗ historical data we took from city's

38:34 ↗ budget documents 2005 to 2018 and that

38:39 ↗ contained into some FTE data as far back

38:42 ↗ as 1996 and you can go back and verify

38:46 ↗ what really happened in each of those

38:48 ↗ years

38:48 ↗ this is budget data not actuals so the

38:53 ↗ numbers from 1996 to 2009 were used to

38:57 ↗ create a pre recession trend line where

39:00 ↗ FTE growth averaged 3.6 percent a year

39:03 ↗ over that 14-year span he then projected

39:07 ↗ out that trend line until 2019

39:10 ↗ that's the dashed blue line to depict

39:13 ↗ what the FTE population could have been

39:17 ↗ without the Great Recession without

39:19 ↗ without without you know lots of caveats

39:21 ↗ there right actual FTE data from 2009 to

39:25 ↗ 2010 is shown in red and it shows F T's

39:29 ↗ that were authorized in nature's budget

39:31 ↗ with an additional data point for what's

39:34 ↗ proposed in 2019

39:37 ↗ so then I had if you look at those two

39:43 ↗ trend lines had staffing trend continued

39:47 ↗ post recession and that growth and staff

39:51 ↗ would have been 26% during that time

39:55 ↗ instead you can see that we responded to

39:59 ↗ the Great Recession by reducing staff

40:02 ↗ and have largely kept those staffing

40:05 ↗ levels constant until just recently as

40:08 ↗ we added back some positions and we are

40:10 ↗ now roughly at where we were at that

40:12 ↗ recession comes remember right so I know

40:16 ↗ you said this and I just missed it so

40:17 ↗ lt's or limited term positions we're not

40:20 ↗ putting in this this calculation so some

40:24 ↗ there's some level of staffing above the

40:26 ↗ red line that is reflects the term limit

40:30 ↗ folk right let me let me explain that a

40:32 ↗ little bit differently better hopefully

40:35 ↗ lt's have been included in the most

40:39 ↗ recent years from let's say 2012 ish

40:46 ↗ i believe we may not have LTS broken out

40:50 ↗ in a way that was easy for us to pull

40:53 ↗ that data having said that we have gone

40:55 ↗ back and we've looked at some budget

40:59 ↗ data that shows that it would have been

41:01 ↗ only a handful of positions so we didn't

41:04 ↗ have in 2000 let's say an extra 200

41:09 ↗ LTE's it would have just would have been

41:11 ↗ a small number it would not have changed

41:13 ↗ this trendline significantly don't

41:16 ↗ remember winters time thank you

41:18 ↗ this chart is interesting that it may

41:21 ↗ tell a lot of different stories one way

41:24 ↗ to understand the data a little bit

41:26 ↗ better would be if we could see this

41:31 ↗ data by Department reason because I

41:36 ↗ think but if my memory serves me

41:42 ↗ not all departments have scaled with

41:46 ↗ city growth like others have for example

41:50 ↗ I know for a fact that parks have stayed

41:51 ↗ really flat for a long time has for a

41:53 ↗ uni easy to look at parks and saying how

41:56 ↗ are you keeping up with all these new

41:58 ↗ properties that you have but other areas

42:00 ↗ we've created new ones and we've done

42:02 ↗ some shifting around but someone like

42:04 ↗ but police has been one where we have

42:06 ↗ incrementally have been adding resources

42:08 ↗ over time so this is an aggregate story

42:12 ↗ about headcount yep

42:14 ↗ but I think the the story about our

42:17 ↗ ability to scale our services to meet a

42:20 ↗ growing community and where we're maybe

42:22 ↗ falling behind and where we're maybe are

42:24 ↗ up to date is more clear when we look at

42:27 ↗ the department level sure and that's an

42:30 ↗ excellent point it will also say as you

42:33 ↗ mentioned we've added different

42:34 ↗ divisions we've added different programs

42:37 ↗ we've consolidated staff in different

42:39 ↗ ways we've moved them across department

42:42 ↗ lines as we've moved programmatic areas

42:44 ↗ from one department to another that

42:47 ↗ analysis is complex to get to apples to

42:51 ↗ apples so that you could see those

42:53 ↗ changes there are departments where it's

42:55 ↗ easier Police Department is very very

42:57 ↗ easy to look at historically and I think

43:01 ↗ you make an excellent point of having

43:03 ↗ just been selective about which

43:05 ↗ departments we have added staff to in

43:07 ↗ which departments we have maybe

43:09 ↗ contracted and and you're right that's

43:12 ↗ not up on this slide this was just meant

43:14 ↗ to illustrate a total thank you for that

43:20 ↗ but just so you know that that whereas I

43:24 ↗ find this data interesting as one of the

43:29 ↗ council members I look at that and say

43:30 ↗ but I think the story lies elsewhere

43:33 ↗ because I know things happen with DSD

43:36 ↗ things happen with Public Works

43:37 ↗ engineering and there's stories behind

43:40 ↗ all of those and so what this doesn't do

43:45 ↗ for me and I don't know I don't know if

43:46 ↗ this was the intent or not but it's like

43:49 ↗ hey we've been very conservative there

43:51 ↗ has been growth we haven't kept pace

43:53 ↗ from a staffing perspective

43:56 ↗ I'm not saying you were intended this or

43:59 ↗ not but it you know it's like okay

44:00 ↗ here's kind of a we're setting things up

44:03 ↗ for the ask that's in here I don't know

44:05 ↗ but for me the better story is when we

44:09 ↗ look at the department level so I'm not

44:11 ↗ this the only thing that I would add to

44:14 ↗ that is I'm I'm not aware and I have

44:18 ↗ shorter tenure than you do but I'm not

44:21 ↗ aware of departments that we have

44:23 ↗ stopped doing are certain major services

44:28 ↗ that we have stopped providing either I

44:31 ↗ hear your point and if at some point as

44:34 ↗ we do make that ask if there's a need to

44:36 ↗ look at apples to apples staffing growth

44:40 ↗ in a particular department or service

44:42 ↗ area we can we can talk about providing

44:44 ↗ that information we can go back I was

44:51 ↗ remembering so the other thing that

44:53 ↗ strikes me and this will just skew the

44:55 ↗ numbers but did you factor out a site

44:57 ↗ fire and rescue when we ended our fire

45:00 ↗ department because we actually did in

45:01 ↗ our fire department so and you see a dip

45:08 ↗ in 99 that's correct

45:10 ↗ yeah so I just want to make sure that we

45:13 ↗ accounted for that too absolutely other

45:16 ↗ questions right now all right thank you

45:20 ↗ so next we're just gonna overlay that on

45:25 ↗ on population as well and masoor story

45:31 ↗ here in terms of population has grown 40

45:35 ↗ percent since that that same moment in

45:38 ↗ time in the last decade and again

45:41 ↗ staffing level has stayed roughly the

45:45 ↗ same again this is just meant to

45:49 ↗ illustrate that the trends on staffing

45:54 ↗ against population growth and how that

46:01 ↗ that ratio has not kept pace with

46:06 ↗ population growth over that time but

46:08 ↗ we can look at it at service levels and

46:10 ↗ and toxic talk about units of service

46:12 ↗ that were attempting to deliver in each

46:14 ↗ group

46:21 ↗ all right so departments are feeling

46:26 ↗ that it's more difficult each year to

46:30 ↗ keep up with service demands and that

46:33 ↗ resulted in for all the years of my

46:37 ↗ tenure here quite a few asks in the

46:41 ↗ budget development process this year we

46:43 ↗ had nearly or approximately 30 positions

46:48 ↗ new positions that were requested during

46:50 ↗ budget development we have significantly

46:53 ↗ reduced that and what's shown in your

46:55 ↗ preliminary budget those totaled nearly

46:58 ↗ five million dollars of cost that is not

47:02 ↗ what we ended up in the preliminary

47:05 ↗ budget we're going to cover that in

47:06 ↗ greater detail next Monday on the tools

47:11 ↗ side of the people and tools framework

47:14 ↗ for the budget there were 50 projects

47:17 ↗ that were submitted these are all

47:19 ↗ technology-based projects we certainly

47:22 ↗ had other small equipment fleet requests

47:25 ↗ as well and we reduced that so we

47:29 ↗ started with a budget ask of over a

47:32 ↗ million dollars and we are only able to

47:35 ↗ afford a fraction of that and we'll talk

47:37 ↗ more about that on the 29th as well so

47:45 ↗ as we look to build the budget we do go

47:50 ↗ back and take a look at what our

47:51 ↗ long-term financial forecasts had to say

47:54 ↗ about where we thought we would be in

47:56 ↗ 2019 and this slide illustrates that the

48:02 ↗ baseline scenario that we utilized in

48:05 ↗ August for our financial retreat had

48:08 ↗ estimated the total general fund revenue

48:12 ↗ at fifty two point six million dollars

48:15 ↗ and a use of fund balance

48:18 ↗ as you can see from the preliminary

48:22 ↗ budget were pretty close to what that

48:23 ↗ financial forecast had estimated but

48:27 ↗ between the different categories are

48:28 ↗ slight differences and then we are not

48:31 ↗ utilizing any fund balance in this

48:33 ↗ preliminary budget on the expenditure

48:40 ↗ side again a pretty similar picture

48:43 ↗ baseline scenario had us at fifty two

48:47 ↗ point eight million dollars and

48:49 ↗ preliminary has this just a shade under

48:52 ↗ that again a little bit of deviation in

48:55 ↗ categories in particular some of our

48:59 ↗ transfer categories like Street and

49:02 ↗ capital projects are up and our other

49:08 ↗ operating is the bulk of the budget it's

49:11 ↗ all the staffing its supplies its

49:13 ↗ services dollars this is the way that we

49:17 ↗ showed it in the baseline scenario to

49:19 ↗ model it and so that's the way is shown

49:21 ↗ here we will be showing you the budget

49:23 ↗ in greater detail and in different ways

49:24 ↗ as we go forward other transfers in case

49:29 ↗ you're wondering includes transfers to

49:32 ↗ the sustainability fund unemployment

49:35 ↗ fund and water utility fund for the Main

49:40 ↗ Street tax program

49:47 ↗ the other thing that we do is we develop

49:49 ↗ the budget is we look back to our

49:51 ↗ financial management policies and we do

49:54 ↗ a little check to make sure that our

49:56 ↗ proposed budget is meeting those policy

49:59 ↗ targets or that we're identifying places

50:03 ↗ where we are going to need to spend more

50:06 ↗ time and effort to get in line with

50:08 ↗ those policy targets so these are the

50:10 ↗ big ones general fund balance target

50:13 ↗ policy is that we have 15 to 20 percent

50:16 ↗ of our expenditures and we are

50:20 ↗ significantly over that as projected now

50:24 ↗ you also have a financial management

50:27 ↗ policy that our ongoing expenditures are

50:30 ↗ funded by ongoing revenues and we've

50:32 ↗ done that by not using fund balance in

50:35 ↗ this preliminary budget next we have a

50:39 ↗ goal around debt that we limited to one

50:42 ↗ point five percent of the city's total

50:44 ↗ assessed value and at the end of the

50:48 ↗ last year and this is data that was

50:51 ↗ presented to you at the financial

50:53 ↗ retreat city had about eight million

50:55 ↗ dollars of outstanding council Manek

50:57 ↗ debt that's non voted debt and so

51:01 ↗ therefore we have still 144 million

51:04 ↗ dollars available in Cal sematic debt

51:07 ↗ capacity having said that that's not

51:10 ↗ necessarily sustainable not something

51:13 ↗ that we can afford but we're meeting

51:14 ↗ that target very easily and then we put

51:17 ↗ one up here to be transparent about the

51:21 ↗ fact that we do have some work to get in

51:23 ↗ line with our financial management

51:25 ↗ policies particularly as they relate to

51:27 ↗ internal service funds the policy says

51:31 ↗ that we shall have a reserve target but

51:34 ↗ staff has not brought forward a

51:37 ↗ suggestion for what those reserve

51:39 ↗ targets should be and Council has not

51:41 ↗ adopted a reserve level for those

51:44 ↗ internal service funds in order to do

51:48 ↗ that we also have some operating budget

51:51 ↗ work to do in order to establish what

51:53 ↗ capital replacement plans are going to

51:55 ↗ look like and a few of these funds we

51:57 ↗ give two examples here or the overall

52:00 ↗ struck

52:00 ↗ the fund or the cost allocation cost

52:03 ↗ accounting between funds that sets up

52:06 ↗ the structure for those funds so we have

52:07 ↗ a bunch of work to do better budgeting

52:12 ↗ in some of our smaller funds and in

52:16 ↗ particular those funds that help us to

52:19 ↗ keep our infrastructure going so I have

52:22 ↗ a question around that so as I look at

52:25 ↗ this a lot of this I think is great in

52:28 ↗ terms of the kinds of things that we

52:30 ↗ want to look at year over the the thing

52:33 ↗ that is maybe missing or not missing I'm

52:36 ↗ not sure when you talk about capital

52:38 ↗ replacement I think I mean you mentioned

52:41 ↗ IT and fleet I think back to former

52:45 ↗ accounts remember share who was always

52:47 ↗ talked about you know our our drain our

52:52 ↗ drained play services right and the fact

52:56 ↗ that at some point they're gonna have to

52:57 ↗ be replaced and the mechanism you know

53:00 ↗ yep to drive towards a goal of being

53:02 ↗ able to say you know we are you know

53:06 ↗ depreciating these assets by a certain

53:09 ↗ amount each year and understanding where

53:10 ↗ that is and that's the only piece of

53:12 ↗ this that I think as a as a dashboard of

53:14 ↗ wellness I that's the piece I feel like

53:16 ↗ is missing so when you talk about

53:17 ↗ capital depreciation you're talking

53:19 ↗ about some very specific smaller fun

53:20 ↗ things but I think there's also a

53:22 ↗ conversation about things that are in

53:25 ↗ the general fund or in some of the

53:27 ↗ larger funds you agree sure and I think

53:31 ↗ you're talking about the turf

53:32 ↗ replacement that type of a large ongoing

53:39 ↗ things that were wonderful that we put

53:41 ↗ in but that we don't presently budget

53:43 ↗ their replacements right right and so

53:46 ↗ some of those were tackling through our

53:47 ↗ capital budget others I'll explain these

53:51 ↗ two a little bit better detail for

53:55 ↗ example both IT in fleet cost

53:59 ↗ allocations right now their budgets are

54:01 ↗ built around the operating expenses for

54:08 ↗ the next year so we look at

54:12 ↗ in eyeties case what's the operating

54:15 ↗ budget for our IT staff and for the

54:18 ↗ repairs and maintenance work that we may

54:20 ↗ need to do and the special projects for

54:22 ↗ that year but if we look at PC

54:26 ↗ replacement we have not fully built out

54:29 ↗ a replacement plan that then adds an

54:32 ↗ increment to every year's budget in

54:34 ↗ order to make sure that we're keeping up

54:37 ↗ with the replacement schedule we have

54:41 ↗ periodically over the last few years put

54:44 ↗ a chunk of cash into the budget in order

54:46 ↗ to get caught up on replacements or to

54:50 ↗ begin a fund but we we have an every

54:54 ↗ year put aside the the right increment

54:57 ↗ of money that we need to keep on pace

54:59 ↗ with that the same is true with fleet

55:01 ↗ replacement we have not done a robust

55:04 ↗ replacement plan and where we're dealing

55:07 ↗ with replacements on a annual basis

55:10 ↗ you know what's due that year and can we

55:13 ↗ afford it this year any other questions

55:17 ↗ right now

55:23 ↗ okay we also wanted to take a look at

55:28 ↗ revenue overtime

55:31 ↗ this is revenue per capita in 2018

55:34 ↗ dollars the source of this data is the

55:38 ↗ annual financial statement from each

55:40 ↗ year from 2003 to 2006 teen and for 2017

55:46 ↗ through 2019 data we use information

55:50 ↗ from budget since we don't have

55:51 ↗ certified annual reports yet for those

55:55 ↗ years we provide this in the aggregate

56:01 ↗ as opposed to individual department

56:03 ↗ totals because we think that's that's a

56:07 ↗ it's a simplified way to look at it to

56:11 ↗ produce this actual curve we took the

56:13 ↗ the revenue in each of those years and

56:16 ↗ converted it to 2018 dollars we did that

56:19 ↗ using the Consumer Price Index from

56:24 ↗ Bureau of Labor Statistics for Seattle

56:27 ↗ and we used the August 2018 CPI let's

56:35 ↗ see what else so while our total

56:39 ↗ revenues have grown over time the our

56:44 ↗ population has also changed and that's

56:47 ↗ what causes this curve to peak around

56:50 ↗ 2004 when there were only about fifteen

56:53 ↗ thousand five hundred people in Issaquah

56:55 ↗ and today there are over 37,000 however

57:00 ↗ one important takeaway from this graph

57:03 ↗ is that the revenues per capita have

57:06 ↗ been relatively flat from 2010 to 2013

57:12 ↗ 19 projection uses the the budget data

57:15 ↗ that we have in the preliminary budget

57:17 ↗ but also factors in a 2.2 percent

57:20 ↗ increase in inflation and a 3 percent

57:24 ↗ growth in population that's what we've

57:27 ↗ averaged over the last six years so

57:31 ↗ there have been significant revenue

57:32 ↗ impacts statewide

57:34 ↗ since 1999 some examples of that have

57:37 ↗ been an initial repeal of the motor

57:40 ↗ vehicle excise tax property tax

57:43 ↗ limitation and of course the Great

57:46 ↗ Recession City property tax collection

57:48 ↗ has been below the rate of inflation

57:51 ↗ city has not added a new significant

57:55 ↗ revenue source during that time period

57:58 ↗ either although we have made adjustments

58:00 ↗ of course to find and fee structures we

58:04 ↗ had an increase in a B&O tax rate and

58:08 ↗ we've certainly had special bond levies

58:11 ↗ for example question

58:16 ↗ that's very interesting what revenues

58:22 ↗ are you talking about

58:24 ↗ I believe these are total revenues but

58:29 ↗ not from the enterprise funds don't

58:32 ↗ believe so total general fund just

58:38 ↗ general fund mm-hmm

58:45 ↗ okay likewise expenditure per capita

58:49 ↗ here same methodology that I explained

58:52 ↗ earlier spend ensures have a similar

58:55 ↗ drop from the early peak around 2004

58:58 ↗ when our population growth took off but

59:03 ↗ our spending

59:05 ↗ stayed relatively flat proportionally

59:08 ↗ from 2010 to 2013 this curve and

59:20 ↗ expenditure management has always been a

59:22 ↗ priority of this city but those

59:27 ↗ macroeconomic conditions and a need to

59:30 ↗ provide services for a growing

59:32 ↗ population and the fact that we are

59:36 ↗ service organizations so a huge chunk of

59:39 ↗ our budget is related to personnel costs

59:42 ↗ and we all know those haven't stayed

59:45 ↗ flat particularly when you look at the

59:47 ↗ cost of providing health benefits so

59:50 ↗ city governments just like ours are

59:53 ↗ always challenged with expenditures that

59:55 ↗ grow faster than revenues and in

59:58 ↗ Washington state municipalities like its

1:00:00 ↗ acquire particularly dependent on

1:00:02 ↗ economic development to drive increase

1:00:06 ↗ in revenue that therefore can support

1:00:08 ↗ increased need on the expenditure side

1:00:11 ↗ remember right so it really would be

1:00:13 ↗ helpful for me and again noting tonight

1:00:16 ↗ but if you give me the actual numbers

1:00:17 ↗ the table of the numbers inside of the

1:00:19 ↗ chart that would be super helpful okay

1:00:22 ↗ thank you don't remember we just diner

1:00:25 ↗ then comes going on tonight or

1:00:26 ↗ councilmember hunt and then comes under

1:00:28 ↗ winter's day on 2017 you mentioned that

1:00:31 ↗ that one is from the budget it's not the

1:00:33 ↗ actual right is it just 2018 okay 2017

1:00:41 ↗ because it was it's not certified yet in

1:00:44 ↗ our Kaffir financial report okay so if

1:00:47 ↗ even though it's not certified and we we

1:00:50 ↗ know for 2018 for example that the

1:00:52 ↗ difference in the revenue is going

1:00:53 ↗ there's going to be some

1:00:54 ↗ difference in the revenue versus what

1:00:56 ↗ was budgeted because 2017 it would be

1:00:59 ↗ good to know what it what it is although

1:01:03 ↗ it's not certified to get a sense for

1:01:04 ↗ how much that varies for the budgeted

1:01:06 ↗ this is the actual sure interest at two

1:01:11 ↗ comments first both this slide in the

1:01:16 ↗ previous one I think those are amazing

1:01:21 ↗ curves actually the fact that the

1:01:23 ↗ per-capita numbers could stay flat and

1:01:26 ↗ my second comment is it's not

1:01:30 ↗ coincidental that's when the

1:01:32 ↗ longest-tenured members of this council

1:01:33 ↗ actually started serving the last

1:01:41 ↗ clearly clearly you can see it before an

1:01:43 ↗ enacting right then we just put them

1:01:49 ↗ together because they look nice together

1:01:52 ↗ yes I like to comment on this a couple

1:01:55 ↗ things first of all I completely agree

1:01:56 ↗ come from Blair weirdness tine suppose

1:01:58 ↗ I'm the one who asked for these numbers

1:01:59 ↗ but this really does when people ask you

1:02:03 ↗ know are you just spending as much money

1:02:05 ↗ as you know government they just want to

1:02:07 ↗ spend all of our money well no you know

1:02:09 ↗ we provide services and over time those

1:02:12 ↗ services in real dollars as we scale the

1:02:14 ↗ organization have have you know been

1:02:17 ↗ flat for sometimes the second thing is

1:02:19 ↗ that of course that there's no hockey

1:02:21 ↗ stick for 2018 2019 and that this

1:02:24 ↗ maintenance budget that the mayor has

1:02:26 ↗ submitted is in fact you know it tells

1:02:29 ↗ that story here and then I want to

1:02:33 ↗ mention that an important factor is that

1:02:37 ↗ by by defining real dollars on CPI it

1:02:42 ↗ also sort of takes out the the benefit

1:02:46 ↗ that the community has seen by increased

1:02:48 ↗ housing prices now there is a CPI is not

1:02:51 ↗ driven off of housing prices right so if

1:02:53 ↗ we if we were doing this on the back of

1:02:55 ↗ the increase in housing value then we

1:02:59 ↗ would see this number trending up right

1:03:01 ↗ this is this is real by making it on

1:03:04 ↗ di and then the final thing that that I

1:03:07 ↗ really like about this is there's only

1:03:09 ↗ really one year where expenditures

1:03:13 ↗ exceed revenues right generally speaking

1:03:16 ↗ we've been able to you know keep

1:03:19 ↗ expenditures at or below revenue and

1:03:22 ↗ that one year was you know in the midst

1:03:24 ↗ is we were as we were diving into the

1:03:26 ↗ the Great Recession so I I really like

1:03:30 ↗ the fiscal restraint that this that this

1:03:32 ↗ chart shows that was that was before I

1:03:36 ↗ was on council other other questions see

1:03:46 ↗ a quizzical look anything no all right

1:03:49 ↗ okay and then we wanted to give you just

1:03:52 ↗ the big picture look on the general fund

1:03:55 ↗ this is the revenue side or what we've

1:03:58 ↗ referred to as resources often this is

1:04:01 ↗ the same pie chart that which was in the

1:04:03 ↗ budget in brief you can see it's a big

1:04:06 ↗ slice of purple up there that comes from

1:04:10 ↗ taxes next largest increment is from

1:04:14 ↗ charges for service charges for service

1:04:16 ↗ are you can think of that as the user

1:04:21 ↗ fees that participants or users of

1:04:25 ↗ different services pay directly for

1:04:27 ↗ those services and and I'm gonna take

1:04:35 ↗ that biggest slice of pie that's taxes

1:04:38 ↗ we're going to break that out a little

1:04:41 ↗ bit

1:04:41 ↗ Ruth talked about this in her

1:04:44 ↗ presentation as well you can see the our

1:04:48 ↗ biggest portion of taxes is coming from

1:04:52 ↗ sales and use which that's opposed with

1:04:57 ↗ local and regional and even national

1:05:01 ↗ economic conditions

1:05:08 ↗ it's a quick question

1:05:10 ↗ so do we find I mean I just don't know

1:05:12 ↗ historically that property taxes are

1:05:14 ↗ more stable and retail sales and use

1:05:16 ↗ more volatile or they both fairly

1:05:18 ↗ volatile both fairly stable I mean those

1:05:21 ↗ mean that makes up the lion's share of

1:05:23 ↗ the plan I I can't speak historically

1:05:27 ↗ for this community I can say my

1:05:31 ↗ experience elsewhere is that property

1:05:34 ↗ tax is considered a stable source for

1:05:36 ↗ sales and uses less so I asked how we

1:05:41 ↗ made a hundred and ten thousand dollars

1:05:43 ↗ off gambling it's a really good question

1:05:49 ↗ there's revenue share that's based on

1:05:53 ↗ what yeah sound like scratch tickets yes

1:05:58 ↗ Kristi is telling me pull tabs and

1:06:00 ↗ scratch games like lottery receipts yeah

1:06:04 ↗ that must be a lot of there must be a

1:06:06 ↗ lot more of that than I realized all

1:06:09 ↗ right thank you lastly we wanted to show

1:06:15 ↗ you the same sort of pie for expenditure

1:06:18 ↗ side of the general fund you can see

1:06:22 ↗ salary and wages is the biggest slice of

1:06:26 ↗ the pie I'm having the management

1:06:30 ↗ analysts do a little bit of research on

1:06:32 ↗ this I actually was quite surprised to

1:06:33 ↗ see this below 50%

1:06:36 ↗ and so I'm posing some questions about

1:06:39 ↗ whether why that's whether or not that's

1:06:41 ↗ the norm for similar municipalities it's

1:06:45 ↗ lower than then I've experienced I think

1:06:48 ↗ in part if you look at combining other

1:06:51 ↗ personnel maybe a chunk from services

1:06:54 ↗ where we're contracting out instead we

1:06:57 ↗ get closer to a number that I would have

1:07:00 ↗ expected helped understand a few these

1:07:05 ↗ labels services is professional services

1:07:08 ↗ so again contractual services it

1:07:12 ↗ includes our legal budget it includes

1:07:15 ↗ some of our communications

1:07:17 ↗ insurance and utilities payments from

1:07:22 ↗ the general fund supplies its office

1:07:25 ↗ supplies small tools and equipment

1:07:28 ↗ computer hardware and software a cost

1:07:32 ↗ allocation right now we have to cost

1:07:34 ↗ allocations that's IT and fleet

1:07:37 ↗ intergovernmental is our funding a fire

1:07:40 ↗ marshal position King County shoreline

1:07:43 ↗ Patrol Eastside Fire Rescue Arch workers

1:07:49 ↗ compensation Services election costs a

1:07:51 ↗ whole bucket of many small things other

1:07:54 ↗ operating costs includes travel rentals

1:07:59 ↗ and leases repairs and maintenance

1:08:01 ↗ scholarships and grants training

1:08:03 ↗ registration dues and subscriptions and

1:08:06 ↗ then other personnel is over time and

1:08:10 ↗ part time non regular wages so our

1:08:14 ↗ part-time staff

1:08:23 ↗ again a different way of looking at it

1:08:27 ↗ looking at our preliminary budget and

1:08:30 ↗ you'll see us use we're still not using

1:08:33 ↗ the right lingo everywhere will say

1:08:34 ↗ propose sometimes some preliminary other

1:08:36 ↗ times I mean the same thing so the

1:08:40 ↗ preliminary budget versus 2018 adopted

1:08:44 ↗ and I'm stressing that charges for

1:08:50 ↗ service taxes and transfers we are

1:08:54 ↗ projecting an increase or have built

1:08:58 ↗ into the budget an increase in revenue

1:09:00 ↗ but intergovernmental licenses and

1:09:03 ↗ permits we are projecting to be down

1:09:06 ↗ some budget to budget and here the in

1:09:11 ↗ taxes as we talked about that's mainly

1:09:14 ↗ coming from sales and use and a little

1:09:16 ↗ bit from business and occupancy charges

1:09:20 ↗ and services that increase is mainly

1:09:23 ↗ from plan check review services and

1:09:26 ↗ recreation fees so you can finish the

1:09:30 ↗ slide ok we're projecting a slight

1:09:35 ↗ decrease as you've seen on your revenue

1:09:38 ↗ summary in building permits it's a

1:09:41 ↗ conservative estimate we tend to be

1:09:42 ↗ conservative in that category because

1:09:45 ↗ sometimes permits come in earlier than

1:09:47 ↗ expected sometimes they come in later

1:09:49 ↗ and so that's really about timing and

1:09:53 ↗ but we we do analysis every year to look

1:09:56 ↗ at what's in the pipeline and try to

1:09:58 ↗ judge what permits they're going to

1:10:01 ↗ apply for what that will result in terms

1:10:04 ↗ of permit revenue and what's the timing

1:10:06 ↗ on all of that we're we're in a

1:10:10 ↗ particularly challenging time a good

1:10:13 ↗ time to try to project revenue but it is

1:10:16 ↗ challenging because this is a period of

1:10:18 ↗ unprecedented growth but we do see some

1:10:23 ↗ slight signs that

1:10:24 ↗ some things are slowing down and so we

1:10:28 ↗ do tend to be conservative prudent on

1:10:31 ↗ estimating our revenues have somewhat

1:10:36 ↗ understand

1:10:36 ↗ thank you since you came back to revenue

1:10:38 ↗ and I was one slide slow Cristina

1:10:40 ↗ whomever is driving could you go back to

1:10:42 ↗ slides thank you this this was the taxes

1:10:48 ↗ one okay that's fine

1:10:50 ↗ earlier this evening we had a public

1:10:52 ↗ hearing on revenue sources and I've

1:10:55 ↗ always found that a little bit

1:10:56 ↗ misleading so I just want to say this

1:10:59 ↗ publicly you can look at that you can

1:11:01 ↗ see we have components that are property

1:11:03 ↗ tax there's a component on sales tax

1:11:04 ↗ there's component being another big one

1:11:06 ↗ on business and occupation tax there are

1:11:09 ↗ other ways that we get for criminal

1:11:11 ↗ justice utility rates that that are

1:11:15 ↗ added to our bills for our utilities

1:11:16 ↗ like phone for example there's many

1:11:20 ↗ different ways that we as a city can

1:11:22 ↗ impact the numbers and the site the

1:11:24 ↗ slices of each of these pies but the

1:11:26 ↗ only question in front of us in this

1:11:28 ↗ budget season at all is the levy rate

1:11:31 ↗ that the city charges for property taxes

1:11:33 ↗ that's it right because I just want that

1:11:36 ↗ should be a very I mean the public

1:11:38 ↗ hearing was titled revenue sources right

1:11:40 ↗ and and and that's I don't know if it's

1:11:46 ↗ intended to cover all the potential

1:11:48 ↗ changes we could have as I can look at

1:11:50 ↗ there's many ways that we could affect

1:11:52 ↗ revenue but the only one we're

1:11:53 ↗ addressing is a potential 1% in property

1:11:57 ↗ tax that's correct

1:11:58 ↗ haven't we so I'm trying to remember in

1:12:01 ↗ pre there are years that we have looked

1:12:02 ↗ at being out but that wasn't part of the

1:12:05 ↗ budget process that was separate from

1:12:06 ↗ the budget or was that part of the

1:12:08 ↗ budget so some years it's been part

1:12:10 ↗ sometimes it's been separate there's no

1:12:14 ↗ rhyme or reason we can do it either way

1:12:17 ↗ other years in addition to you mentioned

1:12:20 ↗ bno as an example we have offered

1:12:24 ↗ suggestions to change

1:12:27 ↗ not on this slide I'll show you this

1:12:28 ↗ slide some new policy and therefore new

1:12:34 ↗ rate structures and fines and fees so we

1:12:40 ↗ have presented those options and the in

1:12:42 ↗ the past this particular budget we don't

1:12:47 ↗ have those recommendations in front of

1:12:49 ↗ you we lay out in the in the IMC there's

1:12:52 ↗ different rules governing these

1:12:54 ↗ different sources and the time at which

1:12:56 ↗ you can present recommendations to make

1:12:59 ↗ changes so we're choosing this here the

1:13:03 ↗ administration is choosing to make that

1:13:04 ↗ 1% recommendation and choosing not to

1:13:06 ↗ suggest to change in Vienna correct at

1:13:09 ↗ this point in the year I will also say

1:13:12 ↗ just be fully transparent that the mayor

1:13:16 ↗ has some level of authority as well to

1:13:19 ↗ make some adjustments on rates for

1:13:24 ↗ example I think if you look at rec fees

1:13:27 ↗ she has the ability to adjust

1:13:29 ↗ non-resident rates up to a certain

1:13:33 ↗ percent increase so it depends on the

1:13:37 ↗ revenue source so if we really give in a

1:13:39 ↗ jam you know those pool fees okay as an

1:13:43 ↗ example

1:13:44 ↗ thank you for that explanation sure

1:13:46 ↗ other questions right now okay okay so

1:13:52 ↗ that leads to the punchline you have one

1:13:59 ↗ question on this one why are

1:14:00 ↗ intergovernmental revenues down so

1:14:04 ↗ significantly in 2019 s preliminary

1:14:07 ↗ budget I in part they're due

1:14:12 ↗ they're down due to state law changing

1:14:15 ↗ on the streamline sales tax that's the

1:14:21 ↗ biggest chunk great things did we get

1:14:25 ↗ was there disadvantage rule change does

1:14:28 ↗ it disadvantageous rule change

1:14:30 ↗ yes I think cities lobbyists had spoken

1:14:34 ↗ about that Doug levy over the course of

1:14:36 ↗ the legislative session it's a it's a

1:14:38 ↗ multi-year

1:14:39 ↗ faizon plan to reduce our revenue and I

1:14:46 ↗ can get you more information about how

1:14:48 ↗ much is expected each year I think I

1:14:52 ↗ think this is the second to last year of

1:14:55 ↗ that reduction if I recall correctly so

1:15:01 ↗ that does lead us to punchline here

1:15:04 ↗ and this sets up the conversation for

1:15:07 ↗ our next budget work session where we

1:15:10 ↗ will talk in greater depth about the

1:15:12 ↗ expenditure side of the general fund

1:15:15 ↗ that 1.7 million dollars of new revenue

1:15:19 ↗ is the amount that we had to work with

1:15:21 ↗ in the budget

1:15:23 ↗ so after departments came and presented

1:15:27 ↗ their 30 new staffing positions and

1:15:30 ↗ their five million dollars of IT

1:15:32 ↗ requests we then had to turn back to

1:15:36 ↗ them and say ok and we have 1.7 million

1:15:40 ↗ dollars of ongoing recurring revenue

1:15:45 ↗ that can support any new adds to the

1:15:48 ↗ budget and this year we worked very very

1:15:52 ↗ hard to get expenditures in line with

1:15:55 ↗ that revenue forecast so 1.7 million

1:15:58 ↗ dollars is not a lot for the the needs

1:16:03 ↗ that I think we were trying to meet this

1:16:04 ↗ year questions

1:16:12 ↗ right that's it I thought it would be on

1:16:15 ↗ the quick side

1:16:17 ↗ I don't think next Monday will be quite

1:16:19 ↗ as fast hopefully you'll hear from other

1:16:22 ↗ people besides me next week I feel bad

1:16:26 ↗ that members of the public left maybe

1:16:27 ↗ only 15 or 20 minutes before how they

1:16:29 ↗ stayed a little longer they could have

1:16:31 ↗ overcome it but oh well

1:16:36 ↗ alright well thank you very much do you

1:16:38 ↗ want to talk a little bit of give us a

1:16:40 ↗ little bit of a heads up for the next

1:16:41 ↗ one

1:16:42 ↗ sure so we will be spending more time

1:16:44 ↗ talking about expenditures we will be

1:16:48 ↗ covering the new staffing requests you

1:16:53 ↗ pull that up real quick take a look at

1:16:55 ↗ that first page the 29th

1:16:58 ↗ oh yeah the calendar will work that

1:17:00 ↗ annotated one so we'll be talking about

1:17:03 ↗ that that the biggest changes on the

1:17:06 ↗ expenditure sites will talk about

1:17:08 ↗ staffing costs

1:17:09 ↗ well there were very limited number of

1:17:13 ↗ regulatory changes that dictated

1:17:17 ↗ additions to the budget so we won't have

1:17:21 ↗ much to report on that front we're past

1:17:23 ↗ years we have we will be also down one

1:17:29 ↗ more 29th

1:17:33 ↗ we're gonna cover Department work plans

1:17:35 ↗ so you'll get a sense of what we put in

1:17:37 ↗ the budget in particular where we're

1:17:41 ↗ we've also included professional

1:17:43 ↗ services in order to support those tasks

1:17:46 ↗ we're gonna cover some of the things

1:17:48 ↗ that weren't included in the base budget

1:17:50 ↗ we're going to maybe talk a little bit

1:17:52 ↗ about if those are high priorities for

1:17:55 ↗ council and community ways that we could

1:17:57 ↗ do some of those by utilization and fund

1:18:01 ↗ balance and we will start to scratch the

1:18:03 ↗ service I believe on capital projects

1:18:06 ↗ and debt assumptions I expect that

1:18:08 ↗ conversation and carry over to the next

1:18:11 ↗ work session because we have some

1:18:13 ↗ significant gaps in our capital planning

1:18:17 ↗ comes up every winters time yeah one

1:18:20 ↗ comment one one question my comment is

1:18:22 ↗ there's a lot to like in this

1:18:24 ↗ budget as proposed and I do appreciate

1:18:27 ↗ the very clear policy objective of

1:18:31 ↗ making sure that our ongoing

1:18:33 ↗ expenditures are covered by ongoing

1:18:35 ↗ revenues and then to deliver something

1:18:38 ↗ that meets that objective that makes

1:18:42 ↗ things a lot easier and so I'm pleased

1:18:46 ↗ with that my question is and you started

1:18:49 ↗ to address it Emily right here at the

1:18:51 ↗ end and I feel like I should know the

1:18:53 ↗ answer to this so it's a little bit

1:18:55 ↗ revealing a little bit embarrassing I

1:18:57 ↗ guess we start by saying at the state

1:19:01 ↗ level we know they do an operational

1:19:02 ↗ budget and completely separate they do a

1:19:03 ↗ capital budget and ours are rather

1:19:05 ↗ weaved in between it seems that we have

1:19:09 ↗ a capital plan that has projects

1:19:12 ↗ expenditures timelines and revenue

1:19:15 ↗ sources but then it's every year I think

1:19:17 ↗ within our this operational budget that

1:19:21 ↗ we take a slice out part of the what we

1:19:24 ↗ call this operational budget there's a

1:19:26 ↗ slice of it as oh by the way this is the

1:19:28 ↗ part that's going to implement this

1:19:30 ↗ year's capital plan right and and I

1:19:34 ↗ guess I just I guess I do understand it

1:19:37 ↗ my ass then would be would be that the

1:19:40 ↗ more clear that delineation could be

1:19:43 ↗ made the better it would be great to be

1:19:46 ↗ able to if I could say clearly like okay

1:19:50 ↗ so in front of us right now is the

1:19:52 ↗ question of approval for a capital plan

1:19:56 ↗ for this part of our for the 2019

1:20:00 ↗ whatever that is now even if there's

1:20:03 ↗ some carryover from 2018 or whatever I

1:20:05 ↗ can say in front of us here's a part

1:20:07 ↗ that's for capital for 2019 and I can

1:20:10 ↗ then open up that capital budget book at

1:20:12 ↗ any time and say this is what we're

1:20:14 ↗ talking about funding unless there may

1:20:16 ↗ be some changes of course but but that I

1:20:18 ↗ guess so that's my as much as anything

1:20:20 ↗ because I know historically we've taken

1:20:23 ↗ capital and we will see those plans

1:20:26 ↗ would at a department level for example

1:20:28 ↗ or there might be and then streets might

1:20:30 ↗ be off by itself and some other things

1:20:32 ↗ but it was never been easy to see all of

1:20:35 ↗ capital

1:20:36 ↗ one place I think with the capital plan

1:20:39 ↗ that we have with seeing the funding

1:20:43 ↗ part that we work on right now it should

1:20:46 ↗ be hopefully should be just very easy to

1:20:48 ↗ line things up and say here's the

1:20:50 ↗ question in front of us for funding to

1:20:52 ↗ do this part of our capital plan yeah so

1:20:54 ↗ I think it's easy to see the picture I

1:20:57 ↗ think it will be a much more difficult

1:20:59 ↗ conversation to have about how we're

1:21:06 ↗ going to proceed with the capital plan

1:21:07 ↗ for 2019 so let me give you an example

1:21:10 ↗ when we adopted the capital improvement

1:21:13 ↗ plan there were three projects shown in

1:21:18 ↗ 2019 which at that point was year 2 of

1:21:21 ↗ the plan that were unfunded in whole or

1:21:24 ↗ in part

1:21:25 ↗ so those projects have not technically

1:21:29 ↗ been included in this proposed budget

1:21:31 ↗ because they were unfunded and then just

1:21:34 ↗ that added a layer of complexity so an

1:21:37 ↗ idea of why I think it's gonna take a

1:21:38 ↗ couple meetings at least and why we I'm

1:21:41 ↗ gonna suggest we may even have to extend

1:21:45 ↗ the conversation on the capital

1:21:46 ↗ component of the budget beyond budgeted

1:21:49 ↗ option perhaps is because we've also had

1:21:53 ↗ things have happened between now and

1:21:55 ↗ adoption of the capital budget so for

1:21:58 ↗ example we have a project where we had

1:22:02 ↗ anticipated it would be fully funded

1:22:04 ↗ maybe but that was dependent upon

1:22:09 ↗ getting a grant a grant that we did not

1:22:11 ↗ get so now that gets added to the

1:22:14 ↗ unfunded list and the work plan in that

1:22:18 ↗ implementing Department included you

1:22:23 ↗ know work on that project and so we need

1:22:25 ↗ to decide are we gonna are we gonna

1:22:27 ↗ allocate to that and also both in terms

1:22:30 ↗ of dollars in staff time and and to what

1:22:34 ↗ end because we didn't receive the grant

1:22:36 ↗ that really enables that whole next

1:22:38 ↗ phase of that project to go so it I'm

1:22:40 ↗ sharing this only because where I said

1:22:42 ↗ it it looks fairly complex and it's

1:22:46 ↗ seems like we could probably get bogged

1:22:50 ↗ down in a conversation about how to go

1:22:52 ↗ about funding capital some of those gaps

1:22:53 ↗ are quite large and may not be able to

1:22:58 ↗ be satisfied through a single funding

1:23:01 ↗ source or a funding source that would

1:23:04 ↗ not require voter approval for example

1:23:08 ↗ thank you

1:23:09 ↗ we did have the financial retreat right

1:23:13 ↗ so the picture of having a capital plan

1:23:17 ↗ that's not fully funded is not news to

1:23:19 ↗ anybody so I didn't so my dad for not

1:23:21 ↗ saying that earlier I certainly I

1:23:23 ↗ recognize I know that with this

1:23:25 ↗ operational budget word there are not

1:23:27 ↗ going to be capped they're not going to

1:23:28 ↗ be capital dollars in this budget to do

1:23:32 ↗ everything that we had adopted in our

1:23:36 ↗ capital plan and I but I did try to slip

1:23:38 ↗ in there and changes because I know

1:23:39 ↗ change is happening but that so aside

1:23:45 ↗ from this exercise we're going through

1:23:48 ↗ now I am anticipating and I don't think

1:23:52 ↗ this is news at all that there will be

1:23:54 ↗ another stream in which we do make a

1:23:58 ↗ decision or not about another funding

1:24:01 ↗ source to cover the known gap for at

1:24:05 ↗ least for just for transportation

1:24:07 ↗ projects so so I know that so I don't

1:24:11 ↗ expect those there to be revenue to line

1:24:13 ↗ up for every all the anticipated

1:24:16 ↗ expenditures and I do expect there to be

1:24:18 ↗ potential changes I'll leave it up for

1:24:19 ↗ you to how to package and deliver that

1:24:21 ↗ but but i but it would be good this is a

1:24:23 ↗ good marker and a good place at which to

1:24:25 ↗ have a nice summary of the capital

1:24:28 ↗ picture yes there are planned projects

1:24:30 ↗ there's expenditures there are things

1:24:31 ↗ relative to budget that they've already

1:24:33 ↗ done and then here's the revenue we have

1:24:34 ↗ in this budget and here's our maybe our

1:24:37 ↗ updated forecast of what the gap would

1:24:39 ↗ be that would be very helpful

1:24:45 ↗ sorry thank you for that what you're

1:24:47 ↗ saying come to member Ramos yes thank

1:24:50 ↗ you so just kind of clear it in clarity

1:24:53 ↗ in other words so positions that we

1:24:57 ↗ approve like the slashers such as

1:24:59 ↗ additional police officers and so forth

1:25:00 ↗ those are all included in this base

1:25:03 ↗ budget if you have a preliminary budget

1:25:05 ↗ and with all those changes then where's

1:25:09 ↗ the 1.7 million in additional revenue

1:25:11 ↗ that that then we're gonna see when you

1:25:14 ↗ bring it is additional things mainly to

1:25:17 ↗ the operating budget additional

1:25:18 ↗ positions you talked about staffing

1:25:20 ↗ average tools those people tools thing

1:25:22 ↗ are going to come into this 1.7 million

1:25:24 ↗ all right and then to lead off on that

1:25:27 ↗ and then we're gonna look at that

1:25:28 ↗ capital side because that's these those

1:25:30 ↗ are the ongoing costs and revenue and

1:25:33 ↗ then looking at ending fund balance or

1:25:36 ↗ other ways to fund some of those capital

1:25:38 ↗ things that we talked about such as

1:25:40 ↗ things that might have gotten unfunded

1:25:42 ↗ place if we may got grants who didn't

1:25:44 ↗ expect whatever all those pictures into

1:25:45 ↗ the capital side will be digging into

1:25:47 ↗ another side of that not including the

1:25:50 ↗ 1.7 because that's more towards the

1:25:52 ↗ operational tools and people side

1:25:53 ↗ correct correct yes Clara from recurring

1:25:57 ↗ yeah other comments questions a couple

1:26:01 ↗ things first off thank you and your

1:26:04 ↗ staff this is a good start there's a lot

1:26:06 ↗ of new faces involved in the budget this

1:26:08 ↗ year and it's just one person's opinion

1:26:12 ↗ that it's going very smoothly given all

1:26:14 ↗ the other new people involved in the

1:26:16 ↗ budget but of course see how these go I

1:26:19 ↗ also want to mention that our next

1:26:22 ↗ meeting for the council is tomorrow

1:26:24 ↗ we've got a council Committee of the

1:26:26 ↗ Whole meeting at 6:30 p.m. here in

1:26:28 ↗ Council Chambers it's not projected to

1:26:31 ↗ be a super long meeting but you never

1:26:34 ↗ know till it ain't over till it's over

1:26:38 ↗ thank you the only thing that you

1:26:41 ↗ trigger a memory for me I had hoped as

1:26:47 ↗ we were kind of talking about new format

1:26:50 ↗ and new process and multi-year

1:26:53 ↗ multi-step improvements that we're

1:26:56 ↗ undertaking part part of how we are

1:26:59 ↗ going to get better at this each year is

1:27:02 ↗ of course getting this feedback from all

1:27:04 ↗ of you about what you would like to see

1:27:06 ↗ how you would like to see it or

1:27:09 ↗ councilmember Ray had offered previously

1:27:12 ↗ a couple of suggestions on report

1:27:15 ↗ formatting any of that will take and as

1:27:20 ↗ we're able to implement them we shall

1:27:23 ↗ thank you that we are adjourned

1:27:26 ↗ Thanks

1:27:31 ↗ you

1:27:41 ↗ you

Approved minutes

Extracted from the next meeting's packet, where this meeting's minutes were approved as a consent-calendar attachment.

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Attendance

Council / Members (7)

Mariah Bettise

Stacy Goodman

Victoria Hunt

Tola Marts

Bill Ramos

Chris Reh

Paul Winterstein