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2003 08 04 WS MinutesMINUTES OF THE WORK SESSION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN August 4, 2003 The City Council of the City of Baytown, Texas, met in work session on August 4, 2003, at 8:00 a.m. in the Hullum Conference Room of Baytown City Hall, 2401 Market Street, Baytown, Texas, with the following in attendance: Coleman Godwin Council Member Calvin Mundinger Council Member Don Murray Council Member Mercedes Renteria III Council Member Scott Sheley Council Member Pete C. Alfaro Mayor Gary M. Jackson City Manager Ignacio Ramirez, Sr. City Attorney Gary W. Smith City Clerk Absent was: Ronnie Anderson Council Member The meeting was opened with a quorum present after which the following business was conducted: Discuss proposed budget for fiscal year 2003 -2004. Mayor Alfaro reviewed the rules for the meeting: All are to participate, each person should be courteous and not interrupt, the views and opinions of others are to be respected, stay on the issues, seek common good for the entire Council, no one is to dominate the discussion, consensus is the agreement of the majority of Council and staff is to be guided by consensus. Gary Jackson, City Manager, gave an overview of the proposed budget. Staff's priorities preserve core services with focus in the areas of public safety and health, employee compensation and benefits, infrastructure, capital improvement plan and bond project implementation, and economic development. The proposed budget is conservative. It does not accomplish everything that the staff would like, but it preserves the core services. No property tax rate increase is proposed. The certified tax roll has not been received, but a 3.2% increase in overall value is projected. A 2.5% across -the- board increase is proposed for all non - collective bargaining employees. Funding sufficient to provide a 2.5% increase for employees subject to a collective bargaining agreement has been identified, contingent upon such increase being included in a collective bargaining agreement that is ratified. Health and dental premium increases are proposed for the City and all employees. The health premium will increase 15.3 %. Nine vacant positions are proposed for elimination. Two vacant positions are proposed to be filled only after April 1, 2004. An increase is proposed for water rates and sewer rates. The increases are mainly due to the Page 2 of 5 Minutes of the Work Session — August 4, 2003 increased debt service on utility bonds. A storm water utility fee is proposed, as is a rate study to apportion the fee based on area and impervious cover. Public Safety and Health comprise 57% of the General Fund budget. In the Police Department, cameras will be installed in the remainder of the patrol cars; additional training will be funded; accreditation of the department will be pursued; additional equipment for the Department of Transportation division is proposed; and the Police Academy building is proposed for construction. In the Fire Department the $750,000 Homeland Security/Weapons of Mass Destruction grants were approved; 7 cardiac defibrillators will be purchased; 2 thermal imaging cameras will be acquired; vehicle replacement will continue; the Emergency Operations Center will be constructed; and funding to continue 4- person staffing is provided. In Health/EMS the Neighborhood Protection Division will be funded; mosquito control funding will be continued; funding to provide for the Trash -Off and participation in Keep Texas Beautiful is provided; funding is provided to off -set the loss of CDBG funding for lot and alley cleaning; funding for the third Mobile Intensive Care Unit is provided; and funding for enforcement of the new state laws relating to restaurants is proposed. Employee compensation and benefits account of 68% of the General Fund budget and 47% of the overall budget. A 2.5% across the board increase is proposed for all employees. In health care, the claim costs are projected to increase 19.3 %. This is offset by a 15.3% premium increase and plan design changes. The dental coverage is under- funded by 57.9 %. This is addressed by a 30% increase in each of the next two years. Health care for future retirees is proposed under a tiered system. The proposal requires rescission of the 1993 action. City contribution to retiree coverage would be based upon length of service to the City, as follows: less than 15 years, no contribution; at least 15 but less than 20 years, 25% contribution; at least 20 but less than 25 years, 50% contribution; and 25 or more years, the same contribution as is paid for an active employee. Infrastructure, capital improvements and bond project implementation will be addressed as follows: Streets -$8.8 million of the street bond program is in final design and $3.2 million in debt will be added; $90,000 is proposed for drainage improvements; and $291,800 of concrete work is proposed. Economic development is supported through staff activities with the Economic Development Foundation. The EDF will be developing a strategic plan that will involve all major stakeholders. Funding for the Unified Land Development Code is proposed in the Municipal Development District budget. Staff is working with EDF personnel at trade and industry shows to promote Baytown. The focus is on recruiting light industry and light manufacturing to the area. Through the Municipal Development District, joint projects with the EDF and TIRZ are being developed to facilitate the recruitment of new and expanded retail and restaurants to the area. The Decker Drive improvements are proceeding rapidly. Traffic signal synchronization is proceeding on Garth Road and is proposed for North Main and Alexander in the future. The North Main and Alexander projects look good for grants from the H -GAC TIP fund. MDD may be available to support annexation and new thoroughfare projects. Annexation will not be actively pursued until the wastewater capacity problems are resolved. The TIRZ 1 has 29 of 300 homes under construction in Eastpoint and 76 of 300 homes under construction in Country Club Manor. Chili's is operating and Johnny Carino's is in the permit process. The TIRZ is expanding the potential for retail and restaurant businesses. TIRZ 2 is proposed for the Island Park development. Page 3 of 5 Minutes of the Work Session — August 4, 2003 In the General Fund, $125,000 is proposed for an additional traffic signal at an undesignated location. In March of 2003 there were 3,912 streetlights that cost $512,470 to operate each year. In the proposed budget, an additional 150 streetlights are anticipated (new subdivisions and citizen requests) at an additional cost of $26,946. The proposed budget contains revenue projections as follows: Taxable properties value increased 3.2 %. No growth in sales tax or franchise payments. The IDA revenue is projected to increase 2.2 %, but this is subject to change due to valuation changes. Growth is anticipated in permits and fees by 5.4 %. An increase is projected in Operating Transfers In of 12.2 %. The budget projects no change in Intergovernmental transfers, however, it was learned recently that Goose Creek Consolidated Independent School District will not provide its share of funding for one Bright Star Officer. There is projected to be a decrease in charges for services by 1.9 %, a decrease in fines and forfeitures by 2.6% and a decrease in interest on investments by 3.1 %. From the 2001 bond program, debt for the following purposes is proposed: • Streets $3,200,000 • Drainage $400,000 • Technology and Communication $905,000 • Parks $125,000. Utility bonds are proposed as follows: • Water and Sewer $16,524,000 • Rehabilitation $10,772,000 • Utility system $5,352,000 • Northeast Wastewater plant $400,000. The debt service fund will increase from $8,000,000 to $9,500,000. No increase is proposed for sanitation fees. A rate increase is anticipated for the next budget year. The hotel occupancy tax fund will provide for the annual Fourth of July Celebration, summer concerts and a children's symphony concert, support for the Bayou Bowl, improvements to the amphitheater, S25,000 for new initiatives, increased expenditures for promotion and tourism, including the Nature Center, webpage development to promote tourism, and 1% of the funds for waterfront cleanup. The Cinco de Mayo parade will be funded through the General Fund. Mr. Jackson then provided handouts on the changes related to health and dental premiums and a summary of the plan changes. The handouts reflected the increased costs for the City and employees under each plan and the seven areas of changes to the health care plan to reduce costs to the City. Council Member Murray asked for information on the Capital Improvement Plan fund. Donna Sams, Finance Director, responded that the fund was developed to capture growth in revenues to fund projects on a cash basis and offset the costs of the 2001 bond program. Council Member Murray asked if a profit was made from the sale of garbage bags. Mr. Jackson replied that the numbers shown in the proposed budget did not include the cost of employees or Page 4 of 5 Minutes of the Work Session — August 4, 2003 storage of the bags. Council Member Murray noted that the Recycling/Dropoff Center operates at a $150,000 annual loss. Mr. Jackson asked Denise Fischer, Director of Library Services, to explain the proposed reduction in Library operating hours from 60 to 51 hours per week. Ms. Fischer reported that the operating hours proposed are Mondays through Thursdays, from 10 a.m. until 7 p.m. and on Friday and Saturdays from 10 a.m. until 5:30 p.m. The change will not affect grant funding eligibility. The reduction will be in part-time staff and security. Alternate sites will be located for the Literacy Program. The Library offers outreach to nursing homes and child -care facilities funded with federal funds or through United Way donations. Outreach to residents in the CDBG target zone neighborhoods is offered through the Bookmobile. Through the facilities of the Bookmobile, all Library services are available, the same as offered in the Library. Council engaged in a discussion of the proposed reduced hours. Mr. Jackson stated that it would be a policy decision for Council. If the hours were maintained, Council would need to reduce $60,000 elsewhere in the General Fund. Mr. Jackson compared the proposed budget against previous projections of revenues and expenditures. One year ago it was projected that, if expenditures continued at the then current rate and revenues remained flat, the shortfall would be $3.8 million. The current projections of revenues are better. Property tax is improved. Sales tax and franchise fees are lower. IDA payments are improved, but this is subject to change. EMS receipts are better. CCPD funding is better than anticipated. Establishment of a Marshal's office would produce new revenue. Interest on investments is lower. Overall, revenues are better than projected. Expenditures were slowed. The General Fund proposed budget is 0.4% less than last year's approved General Fund budget. The proposed budget uses $1.8 million of the fund balance, rather than $3.8 million. The City is experiencing an increase in calls for service. The Police Department is up 8 %. EMS is up 21%. Fire and Rescue calls for service increased 10 %. The workloads have increased while the expenditures have been reduced. During the budget work session on Tuesday, August 5, 2003, the Enterprise Funds will be discussed. This will include the Water and Sewer Fund and the rate study. The budget proposes a two engineer design team to design rehabilitation projects. This should provide a savings over hiring engineering firms for all of the projects. Some projects may require hiring a firm. Mayor Alfaro encouraged the Council Members to read the budget manual and work with the City Manager to get answers. There should be no surprises at the August 28 meeting. Topics requiring additional information are as follows: Library- -costs if closed at 8 p.m. and security provided from 5 p.m. to 8 p.m. and research on calls to the Police Department for criminal acts. A list of services reduced in the proposed budget. Mr. Jackson reminded Council that significant issues confronting Council in the proposed budget are the loss of $80,000 in IDA revenues and the loss of funding from the School District for the Bright Star officer ($50,000). Technical adjustments can be expected as better information is received. Page 5 of 5 Minutes of the Work Session — August 4, 2003 Adjourn. There being no further business, Council Member Godwin moved adjournment. Council Member Mundinger seconded the motion. The vote follows: Aye: Council Members Godwin, Mundinger, Murray, Renteria, and Sheley. Mayor Alfaro Nay: None. The motion carved and the meeting adjourned at 10:42 a.m. G W. Smith City Clerk A