Special/Study Session
April 27, 2009
CALL TO ORDER - at 5:30 p.m.


Paul Loomis, Mayor
Kenneth "KC" Carter, Vice Mayor
Paula Abbott, Council Member
Bill Garner, Council Member
Barry Gillaspie, Council Member
Al Kunisch, Council Member
Salette Latas, Council Member


Discussion and possible action regarding increasing Summer Camp Program Fees

Item 1

Parks and Recreation Director Ainsley Legner presented the item. She stated that last summer the cost recovery of the summer program was 38%. She noted that due to Council direction received earlier in the year, the targeted cost recovery would be between 30% and 60%. 

She addressed Council’s request for the cost recoveries of other jurisdictions: ~Town of Marana - 22% 
~Town of Sahuarita -23% 
~Neither jurisdiction projected that the numbers would rise this summer.

Ms. Legner recommended a 60% cost recovery rate for families per child per week and a 100% cost recovery for non-residents.

It was noted that in a poll conducted by Council Member Latas, the majority of respondents were opposed to subsidizing day camp with tax money.

It was stated that:
~175 - 200 children participated in the summer program each week.
~Summer camp is a weekly program that is open for 8 weeks.
~The demographics should be studied to determine the number of children that reside in the Town that take advantage of the program.
~The registration fee is charged weekly.
  *Pays for every day operation
~Before and after care programs and field trips are offered for additional fees.
~Online registration was implemented last year.
~The software can automatically cap the number of participants as needed.

Council Member Kunisch requested a friendly amendment to include that Town employees, that are not residents, receive a 5% discount.

MOTION: A motion was made by Council Member Latas and seconded by Council Member Garner to direct Staff to set fees at 60% recovery cost for residents and 100% recovery cost for non-residents with the exception for Town employees that are non-residents the rates would be set at a 95% cost recovery rate.

MOTION carried, 6-1 with Council Member Abbott opposed.


Discussion and possible action regarding the Use of Take-Home Vehicles by Oro Valley Police Department Personnel

Item 2

Oro Valley Police Chief Danny Sharp presented an overview of the program.

Discussion ensued regarding:
~Reducing maintenance cost for public safety vehicles by reducing mileage and wear on vehicles that were taken to officers’ residences.
~"Beyond Call Policy"
  *Officers on mandatory call back
    -Property Identification
    -Public Information Officer
    -Hostage negotiators
    -Traffic investigators
    -K-9 officers
    -Task Force officers
  *Mandatory call back occurs on days the officers are on duty
    -Required to be available during the off duty hours
  *The benefit of taking home a vehicle:
    -Shortened response time
    -Officer can drive directly to the scene of the incident
    -Equipment needed is in the vehicle
   *Overtime is paid for time driven
  *On call time is rotated
~Minimum pay for Call Back is 2 hours

Oro Valley resident Art Segal stated that Oro Valley was the only municipality of 13 polled that had unlimited mileage, no mileage limit exceptions and the eligibility for 68 vehicles to be authorized to go home with personnel at the discretion of the Chief. He noted that 21 vehicles went home with officers that lived in the Town whereas 27 vehicles were taken outside Town limits.

Oro Valley resident Richard Tracy stated that taking Police vehicles home was a sensitive issue. He stated that the item was brought forward in retaliation to the Fraternal Order of Police’s (FOP) comments toward certain council members. He noted that because not all communities have this policy, does not mean that Oro Valley should not.

MOTION: A motion was made by Vice Mayor Carter to abandon the program by May 1, 2009. Motion failed due to lack of second.

MOTION: A motion was made by Council Member Latas and seconded by Council Member Garner to discontinue take home vehicles for all employees that reside greater than twenty miles from their regular work site with the exception of the K-9 vehicles.

Council Member Abbott voiced her opposition to the motion stating that there were valid reasons for the take home vehicle program based on communications with the Chief.

Council Member Kunisch stated that he would not support the motion as the decision should be left to the department. He noted that K-9 officers took the dogs home with them and some lived beyond the twenty mile limit. 

Council Member Latas accepted a friendly amendment to exclude K-9 teams from the motion.

Council Member Abbott requested more information from Chief Sharp as to what the impacts to services would be, if implemented. Chief Sharp stated that an analysis would need to be conducted to determine how and which services would be impacted.

Council Member Latas stated her concern to save the Dispatcher position as it also impacted service.

A roll call vote was requested:
Council Member Garner - Aye
Council Member Kunisch - No
Vice Mayor Carter - No
Mayor Loomis - No
Council Member Latas - Aye
Council Member Abbott - No
Council Member Gillaspie Aye

MOTION failed, 3-4 with Mayor Loomis, Vice Mayor Carter, Council Member Abbott, and Council Member Kunisch opposed.

Council Member Garner requested that Chief Sharp explore other opportunities to return to Council with a recommendation that examined cost savings and reduced the number of vehicles leaving Town limits at a future session. The request was seconded by Council Member Latas.


Discussion and possible action on alternative budget proposals regarding for the Oro Valley Police Department’s FY 2009-2010 Budget

Item 3

Town Manager David Andrews reviewed items that had been continued from from the April 22, 2009 study session.

Council Member Garner stated that the most significant savings were due to transferring duplicate costs out of the police department. He noted that it resulted in a cumulative savings of 14%.

Finance Director Stacey Lemos reviewed the Recommended Budget Savings memo. She noted that each area was addressed with a zero based budgeting approach and requested justification from the police department for each item:
~No further cuts were identified to reduce the budget of $373,000 allotted for the Oro Valley Marketplace Substation.
~The current year Capital Improvement Program (CIP) funds had been spent.
~The budget for Minor Assets and Equipment was cut by $17,500 for the coming year.
  *Seizure funds were suggested to purchase items in this category
~Office Lease savings at the Rancho Vistoso and Washington Mutual locations have not yet been identified.
  *One lease has been re-negotiated and will result in a cost savings in the coming year
  *The second lease will be due for re-negotiation soon.
~Cost Transfers were noted as Full Program Transfers
  *The transfers were recommended to reduce and consolidate duplicate functions.
  *Total department transfer of Fleet Maintenance to Public Transit
    -Police department budget - $506,138
    -The creation of a Fleet Maintenance fund in the budget will be considered and would encompass all Town vehicles  
  *Total department transfer of Information Technology to the Town’s Information Technology department
    -Police department budget - $251,940
  *Position transfer of the Public Information Officer to the Communication’s office in the Town Manager’s department
    -Police department budget - $80,000
  *Position transfer of Safety and Risk Manager to the Human Resources department
    -Police department budget - $100,000
  *Transfer of Custody of Prisoners to the Magistrate Court
    -Police department budget - $180,000
  *The total cost savings for recommended cost transfers equated to $1,118,078. 

Operations and Maintenance:
~The Memberships and Subscriptions line item was recommended for a 50% reduction.
  *50% of the cost in this category would be shifted to Human Resources as $6,785 was allotted for the Safety and Risk Manager. 
~The budget of $4,200 for Custodial Supplies was moved to the Custodial and Facilities Maintenance department.
~Non Capitalized equipment was reduced by 25% for a savings of $27,099.
  *Seizure funds may be used to subsidize this category
~Outside Professional Services was reduced by 25% for a savings of $10,784.
  *This item was part of the IT Business Continuity plan and was shifted to the IT department.

Records department salaries and benefits:
~Transferred to Impound fund
  *Due to legalities, an Impound fee fund was created.
  *The Records staff managed the impound fees.
  *The staff’s salaries and benefits would be subsidized from this fund.
    -$100,000 would be shifted from the police department budget to this fund.

Ms. Lemos noted that the true budgetary savings equated to $166,368. She stated that the cost transfers to other departments equated to $1,118,078 making the total reduction from the police department budget, $1,284,446.
She noted that the Dispatcher position was added to the budget in the amount of $54,396 which brought the total savings down to $1,230,050.

Ms. Lemos reviewed the timeline of the various police department budget proposals made to date.

It was noted that 12 hours per week in overtime would be saved if the Dispatcher position was opened for employment. 

It was noted that per Arizona Revised Statutes, the administrative fee charged for the release of an impounded vehicle must be used in furtherance of the statute. Chief Sharp explained that the records personnel that handled those revenues were eligible to be funded by those fees. He stated that currently, $40,000 is projected for the fund by the end of this fiscal year and in the coming year another $60,000.

Mayor Loomis opened the floor for public comment.

Oro Valley resident Richard Tracy stated his opposition to Mr. Musolf’s part in the budget process. He stated that Council should have voted to approve or deny his participation.

Oro Valley resident Joe Hornat stated that accountants should not make the decisions as to what should and should not be cut. He noted that there were other factors involved that should be considered when making reductions.

Oro Valley resident Zev Cywan stated that he that by including Mr. Musolf in the process, the citizen element was brought in to collaborate and that it was a good thing.

Non-resident Officer Kevin Peterson stated that he reviewed the caliber of the officers listed for layoffs. He noted that he was one of them. He stated that the Oro Valley Police Department was second to none. He stressed that the quality of the officers could not be replaced.

Oro Valley resident Dr. Kimberly Morris stated that she was a psychologist in a local elementary school and her husband was one of the six officers in the recommended layoffs. She stated that any layoffs in Oro Valley would be bad for the Town. She stated that the long term effects would be an increase in crime and that Oro Valley would gain a reputation as the place officers would not want to work.

Non-resident Chris Palic commended Council for their efforts to keep police officers employed.

Oro Valley resident Bob Milkey urged Council to make a decision. He stated that damage has been done to the relationship between the Town and the employees. He noted that not all decisions should be made from an accounting perspective.

Oro Valley resident Bill Adler stated that safety was an absolute and that by examining the budget in this manner to save $166,000 could result in unfortunate compromises. He recommended that the Police department be removed from the General fund and a special assessment should be enacted to fund the department.

Oro Valley resident Art Segal stated that it was due to the efforts of Mr. Musolf that the six officers' positions were saved. He noted that anyone who sought to help save jobs should be commended.

MOTION: A motion was made by Council Member Gillaspie and seconded by Council Member Abbott to adopt that the Oro Valley Police department budget alternative cumulative as presented thereby eliminating a reduction of force of Oro Valley police officers and dispatcher, this motion provides no prohibition from Council actions to reduce expenditures from other areas of the budget or expand revenue sources as deemed appropriate by Council action and that concurrent with this motion, the Town of Oro Valley withdraw the COPS grant.

MOTION carried, 7-0.


MOTION: A motion was made by Vice Mayor Carter and seconded by Council Member Garner adjourn the Special session at 7:28 p.m.

MOTION carried, 7-0.


CALL TO ORDER  - at 7:36 p.m.


Paul Loomis, Mayor
Kenneth "KC" Carter, Vice Mayor
Paula Abbott, Council Member
Bill Garner, Council Member
Barry Gillaspie, Council Member
Al Kunisch, Council Member
Salette Latas, Council Member


Administrative Departments proposed budgets

Item g was moved forward.


Economic Development

Item 1g

Economic Development Specialist Amanda Jacobs presented the recommended budget for Economic Development. She stated that the division provided services such as:
~Coordination of project teams
~Business attraction
~Business retention

She noted that the budget reflected an overall reduction of 58% and included the reduction of the Economic Development Administrator.
~The Economic Development Specialist has been managing all facets of the division. The duties included:
  *Overall administration
  *Monthly reports
  *Business attraction
  *Business retention
  *Shop Oro Valley campaign
  *Business Navigator
  *Economic Development video
  *Marketing brochure
  *Maintaining relationships
    -Arizona Association for Economic Development
    -Northern Pima County Chamber of Commerce (NPCCC)
    -Tucson Regional Economic Opportunities (TREO)
  *Facilitating all of the large commercial project teams. 
    -Steam Pump Village
    -Oro Valley Marketplace
    -Venture West
    -Ventana Medical Systems

She reviewed the following line items:
~Decrease in telecommunications due to the potential elimination of the Economic Development Administrator
~Postage would decrease as the "Shop Oro Valley" campaign would draw to a close in November.
~Printing and binding will increase due to:
  *Retention and site visit requests
  *Annual Business Navigator letter
~Travel and training would decrease due to the potential elimination of Economic Development Agreements
~Memberships costs will increase due to the lack of a Financial Participation Agreement with the NPCCC
~Office supplies and miscellaneous will remain flat.

Discussion ensued regarding:
~Mandatory memberships 
  *International Economic Development Council.
    -Ms. Jacobs will soon achieve certification as an Economic Developer
~The Town is currently a member of Arizona Bio Industry Association
~Arizona Association for Economic Development
  *May hold the Governor’s Rural Development convention in Oro Valley in 2010

Ms. Jacobs presented the Bed Tax fund.
~The Bed Tax is 6% 
  *2% is rebated to the Hilton El Conquistador
  *2% is designated to support the Naranja Town Site (NTS)
  *2% for Economic Development marketing has been proposed for allocation to the General Fund.

Ms. Jacobs noted that the funds earmarked for the NTS and a portion of the amount allocated for marketing would be placed in the General fund.

She noted that the total expenditures for fiscal year 2010 were $438,000:
~$282,000 rebated to the Hilton El Conquistador
~$60,000 for marketing
~$25,000 for C-Path
~$50,000 for TREO

Discussion clarified that $120,000 that had been set aside for the Metropolitan Tucson Convention and Visitors Bureau's reserve for tourism.


Information Technology

Item 1a

Information Technology (IT) Director Kevin Verville gave an overview of the IT department’s budget:
~IT recommended budget is $921,000 - 3% of the General Fund
  *14.2% reduction from the current fiscal year due to the following reductions:
    -Capital expenditures
    -Travel and training
    -Operations and maintenance
    -Potential staffing reductions
~The IT department is comprised of five divisions:
    -All Operations and Maintenance levels remain flat in the coming fiscal year with the exception of:
      ~Decrease of 19% in Travel and Training
      ~24% increase in Software maintenance and licensing
        *Increased costs for Munis and Permits Plus systems
        *New maintenance cost for the new website content management system and security and badge systems
  *Geographical Information Systems (GIS)
    -Budget reduced by 28%
      ~Reduction in travel and training
      ~Reduced cost in printing supplies
      ~Staffing reduction - GIS Technician
    -Loss of GIS Technician results in the GIS Analyst fulfilling the duties for the position
      ~Would be unable to work on larger and long term projects
      ~Delays in filing mapping requests and analysis
      ~Reduced representation in regional GIS projects
      ~Delays in downloading data from Pima County 
      ~Delays in developing Geo database back up routines
      ~Delays in Zoning and General Plan layers 
      ~Reduction in time to properly conduct database maintenance
    -Projects that could be delayed:
      ~Storm Water Sign and street maintenance mapping
      ~Automated notice mailings for Planning and Zoning
      ~Business Navigator upgrade and enhancement
      ~Police department Crime Analysis program integration
      ~Integration with Public Works AutoCad users
      ~Enhanced online interactive mapping program
    -$10,000 increase in GIS software maintenance and licensing due to the purchase of a site license for GIS software
      ~The license permits the Town to use unlimited GIS licenses
      ~The price is fixed for 3 years
      ~The Town has saved $50,000 in licensing fees in this fiscal year by negating the purchase of additional licenses.
  *Technical services
    -Budget reduced by 10.8% due to the reduction of equipment repair and maintenance.
    -Reduction in outside professional services for a Network Security Consultant and security testing and auditing
      ~Currently IT staff does not have this level of expertise
  *Business applications and development program has been reduced 32%
~Telecommunications budget has been reduced 7.5% due to renegotiating contracts with the vendor

Discussion ensued regarding:
~There would be an additional employee reporting to IT with the transfer from the police department.
~IT is not scheduled to receive any Capital Asset Replacement Funding (CARF)
  *Computers and servers would not be replaced.
  *This will set IT behind by one year on the replenishment schedule
~Researching online training as an alternative to site training  

~Travel and training under Technical services increased 80% due to the allocation of funds moving from Administration to Technical services

Mayor Loomis commented that funds were still needed to cover the GIS Specialist position. He asked Mr. Verville to review the budget for recurring funds for the position. 


Human Resources

Item 1b

Human Resources Director Sandra Abbey presented the budget for her department. She noted an overal reduction of 22.3%.
~Operations & Maintenance - $11,995 impacted the Human Resources department only
  *The remaining $84,000 encompassed Town wide programs.

Ms. Abbey noted that decreases made to the O&M budget impacted the Human Resources department only. She explained the Admininstrative functions:
~The HR Analyst is developing an internal training program
~1 Director and 1 Human Resources Technician (this position would move to recruitment and employment - eliminating the HR Analyst position)
~Office supplies, printing and postage were budgeted in Administration
Ms. Abbey noted that there would be a need for temporary assistance in July and August during the benefit enrollment period. Additionally, she stated that a representative from Munis software would be needed to prepare for and train Human Resources personnel to utilize the online enrollment module for open enrollment. She noted that the employee self service aspect for this enrollment period would save staff time.

She continued:
~O&M expenditures specific to HR have been reduced town wide programs
~Non-capitalized equipment and telecommunications equipment have not been budgeted
~Elimination of the Town wide holiday party in the amount of $6,000 
~Elimination of Employee Tuition reimbursement program in the amount of $28,000
  *Would require a policy change
  *There has been an increase in the number of employees participating in this program
~Budget reduction in this division is 15%

She reviewed the Recruitment and Employment division:
~Personnel cost reduction of 43.5%
~Departments with hiring needs would need to participate more in the recruitment procedure
~Recruitment advertising budget would be decreased 40%
~$675 in O&M to maintain one national membership in an HR association and one local training program
~The overall reduction is 45.7%

She reveiwed the Benefits and Safety division:
~O&M budget includes $15,000 for employee awards:
  *Years of Service awards
  *Gold Star nomination program 
  *On-the-Spot recognition awards 

She stated that the reductions would result in:
~Lengthier response time for walk in services - appointments would be necessary
~Some of the hiring activities would need to be absorbed by the hiring department
~Updating the classification program would be put on hold or reduced in scope due to lack of staff.

Ms. Abbey noted that the Town will realize cost savings of $60,000 due to the new contract with a benefits consulting firm. She stated that additionally, the Town could expect to receive competitive bids for medical insurance.

Discussion noted the following:
~The Human Resources Technician coordinated the Workers’ Compensation program with the Safety and Risk Manager.
~The Human Resources Analyst has many professional years of experience 
  *Oversees recruitment and special projects
  *In the process of developing a new training program
~Market adjustments have been conducted by the Director with assistance from the Human Resources Technician.
~The savings for switching health insurance brokers is approximately $50-60,000 
  *Ms. Abbey will return to Council with the cost savings realized from competitive bids from insurance carriers.

It was requested that staff inquire whether the insurance company would aid in managing data entry during open enrollment.



Item 1c

Finance Director Stacey Lemos stated that in the proposed budget reflected an overall reduction of 7% and the potential reduction of the Senior Office Specialist.
She noted that 14% of the budget was Operations and Maintenance while 86% was allotted for personnel.

She stated that the department was comprised of 4 divisions:
~Administration which included the Director, and the Senior Office Specialist
  *31.2% decrease due to:
    -Personnel reduction
    -Outside professional services for onsite training and assistance with the Munis ERP software system
    -Travel and training
~Accounting division includes the Accounting Supervisor, Sr. Accountant, Payroll Specialist and Accounting Clerk
  *Expenditures remain flat
~Budgeting division includes the Budget Management Analyst and the Financial Analyst
  *5% increase in expenditures
    -Proposed reclassification
    -One employee that changed health coverage plans during the year
~Procurement division includes the Procurement Administrator
  *.6% decrease due to cuts to postage, travel and training and office supplies

Ms. Lemos stated that the duties performed by the Senior Office Specialist would need to be absorbed by the department. She stated that the impact due to reduced staff levels would be:
~Responding to and processing insurance claims
~Recording secretary to the Finance and Bond Commission and the Capital Improvement Program Technical Advisory Committees
~Processing daily deposits
~Ordering office supplies
~Compilation of annual budget document
~Providing overall support for the Finance department

Ms. Lemos presented justification for the Budget Coordinator reclassification. The salary would result in a 5% increase equivalent to $3,500. She noted that the position has grown to incorporate:
~Developing department performance measures along with management
~Participation in more public venues regarding budget and financial matters.

It was noted that the Outside Professional Services increased due to two contract services:
~Auditors - Heinfeld and Meech - $34,000
~Contract auditors for Sales Tax Audit program - $48,000
  *Budgeted to receive $100,000 in revenue as a result of the audit in FY 09/10
    -Revenue expectations are lower as a result of:
      ~An unusually high amount retrieved from one company 
      ~Decline in construction


Town Manager

Item 1d

Town Manager David Andrews proposed a 12.5% or $120,532 reduction for the Town Manager’s department. He listed the 3 divisions in his department as Administration, Constituent Services and Community Relations. He stated that it was recommended that the Constituent Services Coordinator position be eliminated.

He reviewed the recommended reductions to his budget:
~Travel 35% = <$4,700>
~Oro Valley Vista would be release bi-monthly for a savings of $38,000
~Impacts as a result of the elimination of the Constituent Services Coordinator position:
  *Reduced service levels
  *Reduced response time to citizens’ concerns
  *Hosted homeowners association forums
  *Coordinated Council on your Corner
  *Facilitated neighborhood meetings

Discussion noted the following:
~The Oro Valley Vista could continue online only and save money
  *Some market penetration would be lost.
  *The printing budgets of Parks and Recreation, Library and the Water Utility were combined to afford the printing cost.
~The Constituent Services Coordinator position is an important position.


General Administration & Debt Service

Finance Director Stacey Lemos stated that the General Administration department budget comprised 11.8% of the General Fund budget. She stated that the proposed budget reflected a reduction of 33.7%. She stated that this fund accounted for the following:
~Utility expenses
~General liability insurance
~Community funding to outside agencies
~Sales tax rebates
~Subsidy transfers to other funds for operations and debt service payments

Ms. Lemos discussed the various expenditures:
~Outside professional services was budgeted for $65,000 which included:
  *$10,000 for animal control services feasibility study
  *$25,000 for intergovernmental relations and travel reimbursement
  *$10,000 local management leadership training opportunities
  *$20,000 for a Naranja Town site survey
~Insurance - $200,000 was reduced due to increases deductible amounts
~Town maintained $2M in base coverage plus $10M in excess umbrella coverage
~Annexation expenses reduced $200,000 to cover legal costs associated with the Arroyo Grande State Land annexation
~Funding Outside Sources has been reduced to $164,130
~Sales tax rebates reduced to $1.1M
  *$360,000 Construction tax rebate to Sanofi Aventis eliminated
   *Rebates being held in a separate interest earning account while awaiting the judgment of Turken vs. Gordon

~Equipment budgeted at $230,000
~$130,000 allocated for Capital Improvement Program needs
~Transfer of $322,000 to the Public Transit Fund for Coyote Run Transit services ~Transfer to debt service funds of $936,000 was reduced from $1.8M due to the elimination of the new debt service payment for the Rancho Vistoso Municipal Office Complex 
~Transfer of $60,000 budgeted to the Capital projects fund for maintenance of Steam Pump Ranch

Discussion ensued regarding:
~The importance of the animal control study
  *The potential revenue that could be generated, should the Town assume management of animal control, from licensing fees.
~Research conducting the Naranja Town site survey online at a reduced cost.
~The animal control survey would be funded from cash reserves.
~$25,000 designated under intergovernmental relations was to be used to hire a lobbyist
~The Town’s new website has polling capabilities
~$100,000 was set aside as an emergency fund for capital improvements
  *A number of CIP requests have been deferred to the next fiscal year
~IT has allotted $22,800 for equipment repair and maintenance for printers, computers and minor items. 
~The insurance pool provides coverage for cars accidents and seeking reimbursement for damages from other drivers
~Travel restrictions have been identified for out of state travel.
~The animal control survey could be done for $10,000
  *Pima County collects $50,000 in licensing fees for Oro Valley.
    -Collection of these fees could be managed without building a shelter.


Town Clerk

Item 1f


Town Council



Item 1i


MOTION: A motion was made by Council Member Latas and seconded by Council Member Garner to adjourn the meeting at 9:29 p.m. and continue the remaining items f, h and i to the April 29, 2009 Study session.

MOTION carried, 7-0.