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2003 08 06 WS MinutesMINUTES OF THE WORK SESSION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN August 6, 2003 The City Council of the City of Baytown, Texas, met in work session on August 6, 2003, at 4:00 p.m. in the Hullum Conference Room of Baytown City Hall, 2401 Market Street, Baytown, Texas, with the following in attendance: Ronnie Anderson Calvin Mundinger Mercedes Renteria III Scott Sheley Pete C. Alfaro Bob Leiper Ignacio Ramirez, Sr. Gary W. Smith Absent was: Don Murray Council Member Council Member Council Member Council Member Mayor Assistant City Manager City Attorney City Clerk 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 and informed those in attendance of the illness of Patti Mercer, wife of former City Manager Monte Mercer. He asked that prayers be offered for Ms. Mercer and her family. Bob Leiper, Assistant City Manager, outlined the follow -up issues that are the topics of the meeting, as follows: • Contingency fund and Unforeseen/New Initiatives Account • Adjustments to Industrial District Agreement revenues • Adjustments to City share of health care costs • Adjustments to "Bright Star" program • Discussion of requested information on Library proposal • Budget reductions. Mr. Leiper explained that the Charter requires a Contingency fund, not to exceed 3% of the budget. To meet this requirement, $160,000 is allocated to Contingency. The use of this fund is limited to events that were not reasonably foreseeable. Due to the uncertainty in the revenues last year, a new account is proposed, the Unforeseen/New Initiatives account. In the original proposal, this account would have been funded with $140,000. Changes that have occurred since the end of July have substantially depleted the proposed account. Page 2 of 4 Minutes of the Work Session — August 6, 2003 Industrial District Revenues When the proposed budget was prepared, staff did not have the Industrial values from the appraiser. Therefore the budget was based on the 2002 valuations. Values are dropping in some of the industries. We have received valuations that are $500,000 less than the values presented in the budget. The preliminary values are lower than those projected in the budget. The revenues will be $98,005 lower than projected in the budget. There will be an increase over last year's revenues, but it will be 1.6% or $261,629. To offset the shortfall, staff proposes the elimination of the assistant city manager position (proposed for six months) at a savings of $61,387 and a reduction of the Unforeseen/New Initiative account by $36,620. This reduces the General Fund budget by $98,005. Health Care costs As further study of the City's share of health care costs has been done, staff is concerned that too great a savings was projected in employee turnover. Staff proposes to move $70,000 from the Unforeseen/New Initiatives account to the health care accounts in individual departments. This does not affect the General Fund total expenditures. The funds are shifted from one General Fund account to other General Fund accounts. Coleman Godwin arrived at 4:24 p.m. Bright Star program Goose Creek Consolidated Independent School District has decided not to fund one position in the Bright Star program. This reduces revenue by $43,680. After discussions with the Chief of Police, staff proposes to return the position to Patrol and reduce the Police Department overtime account by $43,680. This reduces the General Fund expenditures by $43,680. Byron Jones, Chief of Police, explained that the department is constantly hiring new patrol officers. Returning this position to Patrol will increase the Police presence on the street without increasing the budget. Library hours and costs To provide Police security at the Library between 5 p.m. and 7 p.m., the cost would be $8,355. The cost to close the Library at 8 p.m., rather than 7 p.m. is $34,273 (staff costs-$12,532, Police costs- $21,741). From July 1, 2002 through July 31, 2003, twenty -four incidents were reported. Fourteen of the incidents occurred between 5 p.m. and 7 p.m., while 10 occurred between 7 p.m. and 9 p.m. The proposed reduction in Library hours is not due to behavior. The proposal was a response to management's requirement that each department find a way to reduce its budget. Staff now proposes that the Library close at 7 p.m. and have Police security from 5 p.m. to 7 p.m. The additional expense for security is proposed to be taken from the Unforeseen/New Initiatives account ($8,355). General Fund expenditures are not affected. Page 3 of 4 Minutes of the Work Session — August 6, 2003 Council Member Sheley suggested deletion of Police security at the Library and Council Member Renteria objected to closing the Library before 9 p.m. Budget Reduction summary Mr. Leiper explained that the amount of reduction is a reduction from the base level budget and did not include health care cost increases or salary increases. Mr. Leiper reviewed the positions proposed for elimination or reduction. All of the positions are vacant. Mayor Alfaro explained his opposition to deletion of the assistant city manager position. The workload is too heavy on the City Manager and Assistant City Manager. He requested that the position be retained in the budget and made subject to review after the end of the first quarter of the fiscal year. Mr. Leiper then reviewed the base level reductions taken in the proposed budget. General overhead shows an increase. The base level reductions do not include the proposed salary increases, but it does include the proposed Unforeseen/New Initiatives account, which staff proposes to be reduced as discussed in the meeting. The total reductions are $933,290 from the base level budget. Mr. Leiper summarized his presentation. The anticipated reduction in IDA revenues ($98,005) has been addressed by a transfer from Unforeseen/New Initiatives account. The reduced Bright Star revenue is offset by the overtime reduction ($43,680). The total revenue reduction ($141,685) is matched by equivalent expenditure reduction. The proposed expense changes in health care and Library security are covered by $78,355 being reallocated from the Unforeseen/New Initiatives account. The bottom line of the budget is not changed. In response to an inquiry from Council Member Renteria, Mr. Leiper explained that staff will provide the technical changes to Council at the August 14 meeting. The assistant city manager position is not in staff's proposal. The savings realized from vacant positions lapse at the end of each budget into the fund balance. It is available for reallocation in the succeeding year budget. It is recommended that such savings be used for capital expenditures and not to fund recurring expenses. The warrant officer position is self-funding and is not an existing employee. The position is proposed to be a peace officer. Mayor Alfaro asked Mr. Leiper to identify the services to the citizens that are reduced in the proposed budget. Mr. Leiper identified the reduction in Library hours and the consolidation of a Parks crew that will delay mowing of parks and medians. He reminded Council that the contracted mowing services are proposed for reduction. Staff has endeavored to maintain the level of service to the citizens, however the response time might be slower. A smaller staff will result in slower response for service delivery. Mayor Alfaro stated that he had received calls concerning the $1 per month fee for storm drainage. The callers expressed concern that the fee would become permanent. Mr. Leiper confirmed that the fee is intended to start a fund and to provide for a rate study. After the rate study, the fee will be adjusted to reflect each property's impact on the storm drainage program. Page 4 of 4 Minutes of the Work Session — August 6, 2003 OW Mayor Alfaro noted that the results of the Council budget priority survey were placed at Council's places. He thanked each member that completed the survey for his participation. Adjourn. There being no further business, Council Member Mundinger moved adjournment. Council Member Anderson seconded the motion. The vote follows: Aye: Council Members Anderson, Godwin, Mundinger, Renteria, and Sheley. Mayor Alfaro Nay: None. The motion carried and the meeting adjourned at 5:32 p.m. G W. Smith City Clerk Opp"