PRESENT:

Peter Lamm, Member Dan Toth, Member Bob Harris, Member

EXCUSED:

Jared Parks, Member Chuck Kill, Vice-Chairman

Vice-Chair Kill opened the floor for nominations for Chairman of the Finance and Bond Committee. 

MOTION: A motion was made by Member Toth and seconded by Member Harris NOMINATE Chuck Kill for Chairman of the Finance and Bond Committee.

MOTION carried, 5-0.

Chair Kill opened the floor for nominations for Vice-Chair.

MOTION: A motion was made by Member Toth and seconded by Member Parks NOMINATE Peter Lamm for Vice-Chair.

MOTION carried, 5-0.

MOTION: A motion was made by Member Toth and seconded by Member Harris To approve the June 2, 2008 Special Meeting Minutes.

MOTION carried, 5-0.

Stacey Lemos, Finance Director discussed the Fiscal Year End Budget Status Report for the Town. Chair Kill requested that the Quarterly Report title be changed to reflect Year End. Various taxes and revenues were discussed. Chairman Kill inquired as to the amount of gas tax per gallon and Ms. Lemos replied it currently is 18 cents per gallon. Member Lamm inquired about building  permits being down 12% and the value for new home permits being down by only 6%. Ms. Lemos explained that most of the new home permits are being requested for custom homes, thus the value has increased on these permits. Member Lamm asked Ms. Lemos to explain the Budget Expenditures vs. Actuals Report. This report will be presented to the Town Council for next year’s budget. Discussion ensued regarding the number of departments in the Town, which is approximately 15, and the percent of contracted personnel services which is 8% for professional services used primarly for special studies, such as Arroyo Grande. Chairman Kill asked what type of taxes go into the bed tax funds and Ms. Lemos replied these funds are for TREO, Cpath and a rebate for the Hilton El Conquistador and for the Naranja Town Site. Member Harris asked about the personnel vacancies and if the Town expects every vacancy to be filled. Ms. Lemos answered we do expect to be able to budget more efficiently to better capture vacancy savings and, the Town has a new system to track the filling of these vacancies.

 

a.	2003 MPC SENIOR LIEN WATER REVENUE BONDS

Ms. Lemos reported there is 1.1M remaining on these bonds. These bonds are used for wells, resoviors, and improvement projects. The need to expand the water system has slowed down due to less demand and growth.

b.	2005 EXCISE TAX REVENUE BONDS

Ms. Lemos reported these bonds have been for the land purchase for the new Municipal Operations Site, space needs planning and a masterplan for the site. The Town Council has approved full funding for the Municipal Operations project in the FY08/09 budget.

c.	2007 WIFA LOAN PROCEEDS

Ms. Lemos reported on the WIFA Loan Proceeds. These proceeds are used to provide reclaimed water to Painted Sky and the El Conqustidor Golf Courses. Chair Kill asked what happens to any excess funds and Ms. Lemos stated they are paid back to the funding source.

Following the presentation Chair Kill asked for a motion to present the Quarterly Review of Proceeds to the Town Council with a favorable recommendation.

MOTION: A motion was made by Member Harris and seconded by Member Toth to  move forward the Quarterly Review of Proceeds to the Town Council with a favorable recommendation.

MOTION carried, 5-0.

MOTION: A motion was made by Member Lamm and seconded by Member Parks to accept the tentative schedule as set forth.

MOTION carried, 5-0.

Member Harris presented Fiscal Year Budgets from the Cities of Brookings, SD. and Sunnyvale, CA as examples of matrixs for budget preparation
and performance measures. This was presented as an illustrated way to present the budget for next year. Member Harris would like to see Oro Valley  go to this type of performance based budget for budgeting outputs for the future. Due to the state of the economy the citizens of the Town are concerned with governmental spending and stability of revenue sources.

Finance Director Stacey Lemos noted a lot of these items are currently being tracked by the various departments and the ability to provide this type of information is definately available by departments. This would need to be a priority from the Town management and the Council. Going to this type of budgeting would take additional resources. The goal of using this type of budget would be to come up with meaningful measurements.

Member Lamm suggested if the Town goes to this type of budgeting it be done on an experimental basis using a small number of variables. Member Toth expressed concerns of using this type of budget including the use of this against managers.   

Chairman Kill asked Ms. Lemos if the Finance and Bond Committee, as a group, should create a recommendation to the Council that they look at this closely and that they determine if they will be the driver for this with the Town Manager. Ms. Lemos suggested that this topic be placed for possible recommendation on the October Finance and Bond Meeting Agenda.

Ms. Lemos reviewed the general facts and assumptions for salary and benefit analysis. There was a 2.5% COLA and a 2.5% merit increase on the employee’s anniversary. Also assumed was a 15% annual benefits cost increase each year.

Chair Kill asked for a walk through of the Salary and Benefit Analysis year by year. The discussion focused on the total budget amount escalation from year to year, and Ms. Lemos explained that part of the budget totals included capital outlay. Chair Kill asked that the numbers be revised to exclude capital outlay. Ms. Lemos also explained that adjustment could be made to future year expenditures in order to meet our revenue projections.  

None at this time.

Chairman Kill called for Agenda items for future meetings.
Member Lamm - Proposed the following two Agenda items:
1.  Restriction on Town spending
2.  Constraints on utilization of Contigencey Funds
Chair Kill requested an update on the Parks and Recreation Fund and Ms. Lemos told the Board there will be an update available for the Town Council on September 3rd.

MOTION: A motion was made by Member Harris and seconded by Member Toth adjourn meeting.

MOTION carried, 5-0.

Meeting adjourned at 7:53 p.m.