MINUTES
ORO VALLEY TOWN COUNCIL
Town Council Budget Study Session
April 13, 2009
ORO VALLEY COUNCIL CHAMBERS
11000 N. LA CANADA DRIVE
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PRESENT: |
Paul Loomis, Mayor
K.C. Carter, Vice Mayor
Paula Abbott, Council Member
Bill Garner, Council Member
Barry Gillaspie, Council Member
Al Kunisch, Council Member
Salette Latas, Council Member
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Finance Director Stacey Lemos addressed questions that arose at previous study sessions.
1) 74 single family residential (SFR) building permits had been issued during the past six months.
- 100 SFR permits had been issued year-to-date
It was noted that in fiscal year:
- 2007 - 335 SFR permits issued generating $1.3M in revenue
- 2008 - 285 SFR permits issued generating $1M in revenue
- 2009 - 150 SFR permits projected potentially generating $500,000
- 2010 - 100 SFR permits projected potentially generating $350,000
Ms. Lemos referenced the following table noting the impact to revenue should projections fall below budgeted expectations.
| Loss | In | Revenue |
| SFR Permits Issued | Residential Permits | Construction Tax | Total |
| 75 | $(78,850) | $(173,997) | $(252,847) |
| 50 | (157,700) | (347,994) | (505,694) |
Council members requested that:
~The projection for SFR be lowered to 75 as the projection of 100 permits was overly optimistic during the current economic crisis
~Staff research the projections for surrounding municipalities
2) The request for an understanding of the re-organization of Public Works Division personnel would be addressed by the Town Engineer later in the evening.
3) Eight employees were eligible for early retirement; 3 of which held positions that were part of the potential reduction in force.
-The individuals in the remaining five positions had not expressed an
interest in early retirement.
-These key positions and would need to be filled when these
employees retire.
4) The cost savings realized from a 1% pay decrease would be $235,466.
The cost savings realized from one day furloughs per pay period would be
$1,477,869, however Police personnel retirement plans required a minimum
of 40 hours worked per week.
5) Currently the Town pays 100% of the insurance premiums for employees and 75% for their dependents. The following tables identify the amount the Town currently spends for insurance premiums and possible scenarios to reduce the cost:
| CURRENT COVERAGE | Total |
| 100% Employee/75% Dependent | $2,163,358 |
| SCENARIO A | Total |
| 100% Employee/50% Dependent | $1,865,531 |
| Savings | $ (297,827) |
| SCENARIO B | Total |
| 100% Employee/25% Dependent | $1,553,339 |
| Savings | $ (610,019) |
| SCENARIO C | Total |
| 90% Employee/50% Dependent | $1,741,820 |
| Savings | $ (421,539) |
| SCENARIO D | Total |
| 90% Employee/75% Dependent | $2,039,649 |
| Savings | $ (123,709) |
Mayor Loomis requested that a column be added regarding the average cost incurred per employee.
6) It was confirmed that should the COPS grant be received later during FY 09/10, the revenue could be used retroactively to July 1, 2009 to fund personnel expenditures.
7) The following steps would be necessary to determine the feasibility of partnering with an outside agency to manage Parks and Recreation programs:
~Complete a cost benefit analysis
*Determine whether it would be profitable for the contractor while providing a savings to the Town
*Procurement Code requires a competitive process for selecting a private operator
-Seek an operator to mitigate risks in operating programs while providing services to the Town and community
~Conduct public meetings for citizen feedback from user groups and provide transparency to the process.
~Time frame would be approximately one year and encompass:
*Cost benefit analysis
*Public outreach
*Selection process
*Transition and implementation
8) The Community Funding subcommittee meeting is scheduled for April 30, 2009 to review applications and presentations.
9) The status of the Metropolitan Tucson Convention and Visitors Bureau (MTCVB) funding will be discussed by the Community Funding subcommittee on April 30th.
10) Capital projects with restricted funding were listed as follows:
~Special Revenue Funds
*Highway fund in the amount of $3M:
-Federal Economic Stimulus funding for roadway maintenance on arterial and collector streets
~Enterprise Funds
*Stormwater fund in the amount of $2,001,600
-Stormwater Drainage Projects; the funding is received from:
`Federal Emergency Management Agency (FEMA)
`Arizona Department of Emergency Management
`Pima County Flood Control
*Water Utility fund in the amount of $6,677,000
-Existing System Improvement projects funded by WIFA loan proceeds and Water Utility funds
~Capital Projects Funds
*Steam Pump Ranch fund in the amount of $534,000
-Funded by Pima County bond funds and the capacity to receive Federal funding
*Alternative Water Resource fund in the amount of $3M
-Funded from WIFA loan proceeds for Central Arizona Project (CAP) Water Improvement projects
*Potable Water System Impact Fee fund in the amount of $1,920,000
-Carry forward bond proceeds from bonds issued in 2000 for expansion system improvements
*Town wide Roadway Impact Fee fund in the amount of $5,671,486
-Outside funding for roadway improvements and capacity increases funded by:
`Regional Transit Authority (RTA)
`Pima Association of Government (PAG)
`Development Impact fees
It was noted that the cost benefit analysis needed to determine the feasibility of partnering with a contractor to manage Parks and Recreation programs was estimated to cost under $25,000 and could possibly be conducted by staff for $10,000.
Parks & Recreation Director Ainsley Reeder presented the item noting that this was a time sensitive process as 15 seasonal staff members would be needed to run the 8 week summer program that hosts about 200 children per week.
She noted that the cost for the summer programs was $254,000 and would be running at a 45% cost recovery rate. She listed the rates as:
~The base fee for residents was $65 per week
~The base fee for non-residents was $70 per week
~$30 for before and after care
~$25 for Friday field trips
She stated that at least 80% of participants were Town residents. She explained that non-residents were comprised of children of Town employees and people who work in Oro Valley. She noted that increase in fees were modest as this was the first year that a differentiation in fees between resident and non-resident would be implemented.
Council Members stated that they preferred that user fees have a cost recovery rate closer to 100% and that the fee for nonresidents should be higher.
Staff was directed to return to Council with an action item noting the cost recovery at various rates:
| RATES | RESIDENTS | NON-RESIDENTS |
| Scenario A | 100% | 100% |
| Scenario B | 90% | 100% |
| Scenario C | 90% | 105% |
Additionally, it was requested that Staff research what other jurisdictions charge and their rate of cost recovery.
Discussion clarified that direction on this item would be given at the April 20th study session, however the department could proceed with hiring seasonal employees.
Parks and Recreation Director Ainsley Legner reviewed the budget for Parks and Recreation:
~The department's budget was approximately 4% of the General fund budget.
~Consisted of 5 operational areas:
*Administration
*Parks
*Recreation
*Aquatics
*Trails
Ms. Legner noted that $300,000 has been cut from expenditures which equated to a 13.9% decrease in budget. She explained the impact of the reductions:
~$74,000 in contracted landscaping services, now managed Parks' staff
-The change was made in order to cut costs in the current budget
~$18,000 by changing from Amphitheater school facilities to Catalina State park for recreational programs
~$21,000 in pool chemicals by changing from bromine to a chlorination system
~$12,000 savings in water due to the new irrigation system at James D. Kriegh park
Ms. Legner explained the impact of the reduction in force of the Multi-Modal Planner in the Trails division.
~Sole employee of the Trail division.
~This employee represented the Town on 12 regional committees and 6 support/work groups for regional events.
~Grant writing
~Longer response time in handling calls regarding trails and safety.
~Town’s participation with the various committees will need to be evaluated and limited to the most necessary.
Discussion ensued regarding:
~Aquatics division should be at a 100% cost recovery.
~1/6 of the budget was paid by user fees.
~The rise in Contract Personnel Services (instructors) equated to more revenue
It was recommended that volunteers attend regional meetings on behalf of the Parks and Recreation department.
It was requested that an analysis of other Towns with pools be conducted to research cost, hours and programs.
It was noted that the Town has received the following grants:
~Heritage fund for a dog park at Riverfront Park, however the State rescinded the grant.
~Transportation Enhancement grant looks favorable since the Canyon del Oro Linear park has been completed.
It was explained that:
~The 192% increase in Equipment Repair and Maintenance under Administration fees was due to maintenance fees for the copier and software maintenance fees for web-based registration.
~The life safety certifications for the Aquatics division under Travel and Training were mandatory.
*Professional certifications for the director and the arborist were also necessary
~The following memberships were the most important:
*Arizona Parks and Recreation Association
*National Parks and Recreation Association
~$300,000 was cut from the budget
~In order to cut programs, it would be a matter of community selection
It was noted that:
~Performance indicators did not identify the success or lack thereof for programs.
~There is significant usage of trails and bike paths
~There would be a significant impact to the Town’s participation in regional meetings
~Programs will need to be more self funded
~The multi-use paths and trails make Oro Valley unique
*Funding should be sought to maintain the Multi-Modal Planner position.
Mayor Loomis called for a recess at 6:30 p.m. The meeting resumed at 6:35 p.m.
Oro Valley Police Chief Danny Sharp presented the item stating that the bids for the substation came in favorably. He clarified that FY 09/10 budget included the substation.
Chief Sharp announced that at a regional competition for Crime Scene Investigation Arizona, Canyon del Oro High School had four teams and placed first, second and third.
| B. |
Police Department FY 09/10 Budget |
Chief Sharp presented changes to the recommended budget for the Oro Valley Police Department:
~Eliminated Subject Matter Expert Consultant/Trainer in the amount of $20,000
~Eliminated employee awards program in the amount of $5,000
~Eliminated "Investigate OVPD" event
~Re-negotiated cell phone bill at a reduced cost of $25,000
~Replacement of gas masks is mandatory
~Ammunition prices increased which will cost about $40,000
~Purchase of 10 hand guns for replacement purposes
~Critical Incidents - must contract for a psychologist to meet with personnel to properly manage such incidents
~Utilities for the Oro Valley Marketplace substation in the amount of $16,700
~$10,000 for a consultant to complete the Information Technology aspect of the Business Continuity Plan
~Kennel fees
~Deferred Capital Improvement Projects:
*In-car cameras
*Replacement of Mobile Command Post
He noted that:
~Volunteers saved the Town over $300,000 in 2008.
~$13,800 budgeted for Citizen Volunteer Assistance Program (CVAP)
Discussion noted the following:
~The increase in line item "Other Employee Benefits" was due to life insurance and moving personnel within the budget categories.
~The increase in Memberships & Subscriptions was due to the Safety and Risk Manager’s required certifications.
~It was noted that the attrition rate for last 3 years was 4.4%.
Vice Mayor Carter requested a comparison of the 2008/2009 budget projected to July 1, 2009 and compare to 2009/2010 budget.
Council Members urged that the new proposed budget cuts remain regardless of the outcome of the grant that could fund six officers' positions.
Mayor Loomis called for a recess at 7:35 p.m. The meeting resumed at 7:42 p.m.
Assistant Town Manager Jerene Watson presented the item.
It was clarified that the recommendation to Council was to reduce travel budgets by 1/3 and allow directors to determine how the budget should be handled.
It was noted that some professional certifications may be completed online.
The Mayor recommended that travel within state could be approved by department managers and out of state travel could be approved by the Town Manager. He further stated that travel updates could be made to the Council during budget updates to determine whether these controls were necessary.
It was noted that the total amount requested in the budget for travel and training was $260,000 for all departments. Ms. Lemos informed Council that $360,000 was the amount budgeted for FY 08/09.
Town Engineer Craig Civalier presented the Public Works department budget. He listed the funds that were managed by Public Works:
~Highway fund
*21.8% reduction
*Reduction of 5 full time employees
*$3M in Federal Economic Stimulus funds were excluded from the budget as they would be
managed by the Arizona Department of Transportation(ADOT)
~Town Wide Impact Fee fund
*72.6% reduction
-No roadway widening projects for 09/10
~Custodial Maintenance
~Stormwater
*41.8% increase due to State and Federal funding for flood control projects
~PublicTransit
Mr. Civalier discussed the impacts the proposed budget cuts would have with regard to operations:
~Department reorganization to balance duties as a result of staff reductions
~Roadway building projects will be reduced
~Delay pavement management program from reaching 100% for 2-3 years
*Currently 85% implemented
~Fewer in-house designs in highways, Stormwater and traffic engineering studies as a result of staff reductions
~Street Operations will need to balance current duties with inspecting the annual surface treatment project
~Administrative support duties will need to be reallocated with the proposed cut of 2 clerical positions
~Response times for internal and external customers will increase
~Impacts to Transit
*Service reductions
*Passenger load would be limited to 60 per day
*Same day service and guaranteed reservations would be eliminated
*Reservations would not be taken after 3 p.m.
-Dispatcher will be acting as a driver
*Trips could be cancelled due to lack of drivers
*11.3% reduction in the Public Transit fund
-Staff reduction of 1 part time employee
*Termination of Intergovernmental Agreement (IGA) with the City of Tucson for an underperforming express route
~Custodial Maintenance fund
*9.5% increase as a result of shifting 1 full time employee form the Highway fund to this fund
Transit Administrator Aimee Ramsey stated that currently 79 passengers were transported per day. She noted that since the hiring freeze, Transit is short 2 drivers. She explained that the remaining drivers have not taken any vacation time in order to meet public demand. She stated that Transit would be losing another driver.
It was noted that the majority of passengers were senior citizens and were not eligible for Handicar services as that service was strictly for people with disabilities.
It was clarified that:
~The budget did not contain any job reclassifications
~Overhead costs would not be covered by Stimulus money
~Contractors that bid on stimulus contracts must be local
*Stipulation of the Stimulus package
*ADOT will administer contracts and funds from the Stimulus package
-The State will manage projects on the Town’s behalf
~Finance could identify Stimulus funds as a separate fund
It was noted that Coyote Run's initial function was to provide rides to medical appointments and was operating at an 11% recovery rate.
The Mayor requested that an action item be prepared for Council that included the following:
~Identify elements that could be done to conduct work in house
~Parts of the budget that could be changed
*Contingency recurring funds
-Contingency reserves can be used to cover emergencies
-Unnecessary to include emergency funds in the Public Works budget.
~Identify the percentage of Coyote Run trips made for medical purposes and for leisure
~Research possibilities for allotting so many seats per day for passengers that need service for medical appointments.
Council Members recommended:
~Reviewing fees and possibly re-zoning to increase cost recovery
~Creating an inexpensive fare for seniors to get them to the commuter buses
~Review and return with how the decrease in drivers impacts ridership
It was clarified that $50,000 was budgeted for annual maintenance for both park and ride locations.
Library Administrator Jane Peterson presented the proposed Library budget noting the following:
~Visitors to the library have increased 11% since last year.
~Program attendance is 25% higher than last year
~Serves 605-1,000 people per day
~The library’s budget is $1,252,406 which is a reduction of 4.5%
*5% of General fund expenditures
~Anticipated reimbursement from Pima County is $601,783
~The Town’s share of the budget would be $649,623
She listed the four program areas:
~Administration
~Technology
~Youth services
~Adult services
Ms. Peterson explained the reductions to Operations and Maintenance:
~Eliminated use and maintenance of the Town car
*Will reimburse for mileage as necessary
~Eliminated the storage unit, coffee service, First Aid cabinet refills, some subscriptions and memberships and waste management services
~The Volunteer Recognition dinner will be paid for by the Friends of the Oro Valley Public Library
~Installation of the new check out system will also save money
She noted that $16,000 was trimmed from the original budget request. She stated that staff had been reduced by 3 positions; 2 Pages were cut due to attrition and 1 proposed lay off.
Ms. Peterson stated that the budget for collection materials went up as the library collection was seven years old and needed updating and new publications needed to be purchased.
It was noted that:
~Pima County reimbursed 50% of the collection cost
~According to the IGA, Pima County must have a 120 day notice in order to turn the management of the library over to them
~The reimbursement rate from Pima County for personnel was 50%
~The position proposed for lay off was a 14 hour position
The reclassifications were noted as follows:
~Library Associate to a Senior Library Associate to handle scheduling and evaluations
~Page to Customer Service Representative
*Requires an additional level of training to apply more duties
It was noted that:
~Library Associates or Library Technical Assistant III (as classified by Pima County) had a difference in salary of $2,032
~Library Page or Library Technical Assistant II had a difference in salary of $3,587
~The increase in the line item for Adult Services was due to the transfer of two employees to this line item from Administration
The Mayor requested that an action item be prepared to include:
~Personnel costs for FY 08/09 and the projected cost for FY 09/10
~Changes in the budget to reflect the job titles used by Pima County
It was explained that according to Town procedures, in order to reclassify an employee, that employee must be placed within in the pay range of the reclassification.
MOTION: A motion was made by Vice Mayor Carter and seconded by Council Member Garner to adjourn at 9:10 p.m.
MOTION carried, 7-0.