1. Call to order. AGENDA North Liberty City Council November 18, 2014 Special Session 6:30 p.m. City Council Chambers 2. Roll call. 3. Approval of the Agenda. 4. FY 16 Budget Goal Setting. A. Discussion and goal setting for the upcoming budget process. 5. Adjournment. City of North Liberty – 2014 Page: 1 Updated: November 14, 2014 9:00 a.m. City of North Liberty FY 16 Budget Goal Setting November 18, 2014 North Liberty City Council Chambers 6:30 P.M. Budget Timeline • Oct 1 – Oct 3 Department Heads create budgets • Oct 31 Proposals submitted to City Administrator • Nov 18 Budget Goal Setting with Council • Nov 18 ‐Dec 12 Dept Head meetings with City Administrator • Jan 13 Budget work session with City Council & Department Heads • Jan 20 Budget work session with City Council • Jan 27 Budget work session with City Council (if needed) • Feb 20 Publication of proposed budget • Mar 10 Public Hearing and adoption of FY 13 budget • Mar 15 Final Budget certified with County Auditor Administration’s Budget Objectives • Maintain current levels of services and operations. • Address service, operational and infrastructure needs due to growth. • Address infrastructure needs due to aging. • Continue to maintain/build adequate cash reserves. • Continue to explore alternatives for providing services more efficiently/effectively (on‐going throughout the year). • Review utility service funds and rates to plan for current and future needs. Current Fiscal Conditions • City of North Liberty maintains strong financial position. – Major funds projected to grow or maintain strong cash position in FY 15 (noted by Moody’s) • Road Use Tax Revenues exceeding projections (special census results will also benefit RUT fund) • General fund remains strong • Utility funds will continue to be monitored, appropriate rates adjustments recommended. Fund balances in water and wastewater grew in FY 14. Bond rating is Aa3 (exceptional considering our tax base size) At 47% of debt capacity Aggressive in repayment of bonds (noted by Moody’s) Continue to see growth in taxable value; however, new tax laws will have negative implications to taxable values – Well defined CIP and Financial Planning Model will help maintain strong financial position – – – – Fund Balances ‐ June 30, 2014 $3,000,000 25% reserve $2,500,000 56% reserve $2,000,000 50% reserve $1,500,000 $1,000,000 52% reserve $500,000 32% reserve $0 General Fund Road Use Tax Fund FY 13 Actual Water Fund FY 14 Actual Wastewater Fund FY 15 Budget Stormwater Fund Fiscal Challenges • Growth – Continued growth results in increased service needs or demands • Growth does not always cover expenses • Request for services have not slowed – Staffing levels is some departments have not increased despite the additional demands and responsibilities – Additional demands on infrastructure • Costs of maintaining and adding infrastructure • Facility plans identify $30 mil in improvements over next 5‐10 years – Liberty High School Growth Area • Estimated investment for infrastructure: $12 mil – Capital Projects • May need to reprioritize capital projects to maintain financial strength • State Decisions – The new tax laws will negatively impact the budget; however, specific revenue projections are unknown Land Valuation History $1,400,000,000 $1,200,000,000 $1,000,000,000 $800,000,000 Assessed Taxable $600,000,000 $400,000,000 $200,000,000 $0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Tax Rate History $12.00 $11.50 $11.34 $11.20 $11.03 $11.00 $11.03 $10.97 $11.03 $11.03 $10.91 $10.50 $10.16 $10.00 $10.15 $9.50 $9.00 $8.50 $8.00 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Rollback Data Residential 58.00% 56.00% 54.00% 52.00% 50.00% 48.00% 46.00% 44.00% 42.00% 40.00% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Commercial 100.00% 98.00% 96.00% 94.00% 92.00% 90.00% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Breakdown of Property Taxes Paid ‐FY 15 Iowa City School District (in NL) Community College 3% CCA School District (in NL) State 0% Community College 3% North Liberty 32% North Liberty 33% ICCSD 42% State 0% CCASD 44% Johnson County 22% Johnson County 21% Tax Rate Comparisons – FY 15 Comparable Iowa Cities Johnson County Cities (Population Range 9,000 to 20,000) $17.49 Fairfield Iowa City $16.70 $17.05 Keokuk $16.29 Fort Madison Coralville $13.53 West Branch $12.04 Newton $15.81 Norwalk $15.69 $15.63 Boone Tiffin $14.42 Grinnell $11.97 $14.15 Waverly North Liberty $11.03 Solon Oskaloosa $10.97 University Heights $13.86 Coralville $13.53 Waukee $13.50 $13.50 Le Mars $10.88 $13.02 Storm Lake Oxford Lone Tree $9.23 Swisher $0.00 $8.00 $11.98 Pella $7.10 $4.00 $11.99 Carroll North Liberty $8.10 Shueyville Spencer $11.34 Johnston $8.10 Hills $12.70 Indianola $9.38 $12.00 $16.00 $20.00 $11.03 $10.20 Clive $9.99 Altoona $9.94 $0.00 $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 $14.00 $16.00 $18.00 City Council Proposed Budget Goals Goal Community visioning Public transportation Inclusionary housing (not necessarily budget related) Evaluate the salary and benefits structure for employees Evaluate cost containment and allocations for machinery/equipment, expansion of capital budget allocations for emergency purchases Allocate financial resources for community visioning Define reasonable transportation programs and costs Define impact of new property taxation and determine additional set‐aside funds to sustain current programs Staff Comments This was determined to be a priority by Council in the 2014 strategic planning session. Funding would need to be allocated in the FY16 budget to complete this project. The Transit Task Force met in September and recommended no changes to the current programs. If Council desires other alternatives, the Task Force should be included in the discussion. Planned to be discussed by Council prior to joint government meeting in January and then again by joint government group. This could be completed internally or by a consultant. If completed by a consultant, funding will need to be budgeted. Uncertain on this objective. Need additional information. This was determined to be a priority by Council in the 2014 strategic planning session. Funding would need to be allocated in the FY16 budget to complete this project. The Transit Task Force met in September and recommended no changes to the current programs. If Council desires other alternatives, the Task Force should be included in the discussion. Staff continues to review and monitor the changes. This year’s tax valuations will shed some light on the unknown. Council Consensus City Council Proposed Budget Goals Goal Staff Comments Establish a budget amount for miscellaneous charity requests that organizations can apply for over the course of the FY and a corresponding policy for use so we are not tempted to keep depleting the GF balance Plan to stop the limited Coralville bus system and use the funds to pay for individual trips for needy persons (possibly taxi vouchers). Would need to partner with Crisis Center/Food Pantry/FRC/Seniors agency to coordinate. Continue funding for Civic Campus planning, expanding on the current work to help start getting the ideas to the public Currently include some additional money in the budget for these types of requests. Developing a policy would require additional discussion and consensus of Council. Maintain at least 25% of budget reserve in the GF Get some type of improvement into Centennial Park‐ either a trail, playground structure, picnic building, or something to encourage use Develop an energy reduction strategy that includes, but is not limited to renewable energy use on city owned facilities (i.e. solar energy on Rec Center, Waster Water plant, Water Wells/pumps) and applying for grants/loans to replace bulbs/fixtures throughout city. Working with the League of Cities, there are programs being used across the state to model. Examine, and reduce, areas of redundancy in overlapping duties of city staff. One example is the mowing of grass around waste water and water plants, as well as across the city. This should fall under the direction of the Parks Department. Another may be regarding maintenance of our fleet of vehicles (see next item) Establish a FT Mechanic position for maintenance of city vehicles. Again, with efficiency in mind, but we may save money/time under one roof. The Transit Task Force met in September and recommended no changes to the current programs. If Council desires other alternatives, the Task Force should be involved. Phase 1 of this project is nearly complete. Next step would be public involvement and education followed by bond referendum. Currently at or above 25%. Staff currently working on SRF grant for construction of trail and parking lot in Centennial Park. Currently involved with the City Energy Management Program (1 of 20 cities in Iowa participating) that will help with energy reduction. Researching solar for new facilities (water and wastewater plants) and have completed fixture replacements in city facilities, including the recreation center, fire and police stations. Other options can certainly be explored. Staff reviews efficiencies and processes on a year round basis. There is always room for improvement and it is looked for regularly. This specific issue was discussed last year and can be revisited this year. This can be reviewed at the staff level. Council Consensus City Council Proposed Budget Goals Goal If financial modeling doesn't already include this, maintain our current tax rate over the near term as we prepare to take on a major GO Bond with the new City Hall/PD site. I'd like to see this issue of borrowing money go to the public for a vote without a tax increase. Consider adding an IT professional to staff. All departments rely upon technology more each year, and we may be at a point where a third party may not be able to provide the level of service we need or at the most effective price. Staff Comments The model can be modified to better provide this information; however, borrowing money, especially for new offices will have an impact on the tax rate. This can be reviewed at the staff level. A concern is going from a company with multiple employees and specialties versus one IT professional. The level of service most certainly would decrease with only one IT person available to the entire City. Infrastructure ‐ new growth and keeping up with the Currently provided for in CIP. useful life of aging areas Phase 1 of this project nearly complete. Next step Public safety support ‐ civic campus, police and fire would be public involvement and education followed by bond referendum. Parks & recreation support ‐ play equipment, trails, Currently provided for in CIP. etc. Are we maximizing our efficiency? For example, Staff reviews efficiencies and processes on a year improving processes while adding value, energy round basis. There is always room for improvement efficiency, etc. and it is looked for regularly. Current financial position is solid. Should continue Maintain our strong financial position to work with financial consultant and prioritize the CIP in a reasonable fashion. Infrastructure to new high school Currently provided for in the CIP 965‐‐either working on designs or a stage each year Currently provided for in the CIP Design for the city center for city staff, police, and fire Phase 1 of this project nearly complete. Next step should be public involvement and education followed by bond referendum. Review our priorities and delay some projects if needed Deserves additional Council discussion. Council Consensus City Council Goals The Process Each Councilor to identify goals (3‐5) After all goals are identified, discuss each goal and gain consensus Finalize list of goals for FY 15 budget Tips for Establishing Goals Goals should be: • Specific but not micro‐level. Think macro (i.e. project/policy oriented, not line item detailed). • Measurable. • Attainable. Goals are just wishes if they can’t be accomplished. • Relevant. The number of goals can be minimized, leading to greater chances of success, if the subjects are topical. • Time‐Bound. Goals take on more urgency if time frames for success are incorporated.