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Home My WebLink AboutCC Min 2011-04-05Seal Beach California April 5, 2011 The City Council of the City of Seal Beach met in adjourned 2011 Budget Study Session at 5:00 p.m. with Mayor Levitt calling the meeting to order. ROLL CALL Present: Mayor Levitt Council: Deaton, Miller, Shanks, Sloan City Staff: Jill R. Ingram, Acting City Manager Chief Jeff Kirkpatrick, Seal Beach Police Department Sean Crumby, Director of Public Works Robbeyn Bird, Director of Administrative Services/Treasurer Mark Persico, Director of Development Services Chief Joe Bailey, Seal Beach Marine Safety /Lifeguard Department Linda Devine, City Clerk Others Present: 17 City employees and 17 community members ACTING CITY MANAGER The acting City Manager introduced Dave Morgan - retired Anaheim City Manager and Executive Consultant for CPS Human Resources in Sacramento. Mr. Morgan set the tone of the study session by providing a presentation that emphasized areas in "Leadership and Public Finance" BUDGET STUDY SESSION The Director of Administrative Services provided a powerpoint presentation (on file in the City Clerk's office) covering the following: • Revenues and Expenditures Decline in Revenues: Utility User's Tax; Property Taxes; Barrel & Excise Tax; Transient Occupancy Tax; Franchise Fees; and Interest Income Increase in Expenditures: Post Employment Benefits (lifetime medical); Fire Station Bonds; Police Department Medical & Overtime; Vehicle Transfers; and Senior transportation • Budget Process 1 st Phase: 2% Department Budget Cuts (November 2010) - Carmany; 2nd Phase: Change in Direction - Categorize line items by Federal, State, and City Council Mandates (remainder of budget line items marked as discretionary) - Importuna; 3rd Phase: Director of Administrative Service - eliminated optional items (OPEB - lifetime medical funding, JPIA - Joint Powers Insurance Authority, and Vehicle Transfers); eliminated overtime for non -sworn personnel; and decreased overtime for sworn personnel 4th Phase: Reviewed 5 years of data (budget vs. actual); and 5th Phase: Reviewed prior year budget to current proposed budget (result - $500K deficit) • Budget Goals Present a balanced budget; Preserve current service levels; and Preserve core work force - Major balancing items: Leave vacancies open (Accounting Technician, Equipment Services Supervisor (reduce to part- time), and Executive Assistant); Eliminate Positions (Office Aide (part- time); and Decrease Overtime • Revenue Projections - Fiscal Year 2011/2012 Proposed Revenue - $26,237,700 -Top 3 Major Revenue Sources: Sales Tax - 16 %; Property Tax - 31 %; and Utility User's Tax - 19% (total 66% of revenue source) -Lost Revenue from General Fund Interest due to the spending of the reserve funds 1 1 J Page 2 - Budget Study Session 04 -05 -11 • Expenditure Projections - Fiscal Year 2011/2012 Proposed Expenditures - $29,344,700 - Expense areas of concern: City Attorney; Joint Powers Authority; Fire Authority; Tennis Center; Special Events (In -kind costs); Senior Transportation Program; Jail Operations With no objections, the Mayor called a recess at 6:25 p.m. and reconvened the study session at 6:38 p.m. - Expense areas of concern (continued): Police Department Overtime (field services (sworn pe'rsonnel), support services (non - sworn personnel, and detention facility) • Vehicle Replacement Budget Initial set -up for the Vehicle Replacement Fund (VRF) was $2M designated from the General Fund - currently there is $1.2M in the account - it is recommended not to transfer any additional funds into the VRF and re- analyze the fleet replacement list. With no objections, the Mayor called a recess at 7:37 p.m. and reconvened the study session at 7:47 p.m. • Fund Balance Reserves - Accounting Cycle: Balance Sheet (permanent accounts) Assets = Liabilities + Fund Balance and Income Statement (nominal accounts) revenues and expenditures (collect costs all year long) - General Fund Total Fund Balance: Beginning Fund Balance + Actual Surplus /Deficit (expenditures over revenues) equals Ending Fund Balance - General Fund: Designated Balance = $14.4M and Undesignated Balance = $5M - Designations: City Clerk (donation); Traffic Impact Fees; College Park East; Swimming Pool; Economic Condition; Street Improvement; Storm Drain; Buildings; and Compensated Absences - Fiscal Policy Requirement and Encumbrances • Economic Outlook -Slow Economic Recovery; Small but Steady Growth; and Watch Cautiously the actions of both State and Federal legislation. - Future Items to Consider: Increase in pension costs; rising medical costs; and negotiations with 2 employee groups • Long -term Financial Planning - Evaluate tennis center; evaluate jail operations; contain police overtime; re- negotiate vendor contracts; and re -open personnel contracts (police) PUBLIC COMMENTS (limited to 5 minutes each) Robert Goldberg, Clipper Way, stated his opinions regarding police overtime - vehicle replacement fund - vendor contracts - and OPEB; Jim Caviola, Ocean Avenue, expressed his interest in trees and recommended Council budget $100,000 for the tree program - not subsidize the tennis center; Esther Cummings, St. Andrews Drive, inquired about vendor contracts; and Bruce Bennett, 4th Street, asked questions regarding CalPERS and the unfunded benefits. COUNCIL COMMENTS • personnel (position elimination and not filling vacancies) - review after a year and may reinstate positions if funding is available; • lifeguard boat repair - delay purchasing a new boat; • budget overtime for the jail - not realistic to budget zero; • questions about not funding the JPIA and OPEB; The Acting City Manager concluded that the study session was to present the budget information to Council and the next study session the Council and public Page - 3 Budget Study Sessions 04 -05 -11 will have an opportunity to ask questions. The CIP presentation will be on the 13th and the Council will have a week to study all the information and then offer any recommendations. ADJOURNMENT With no objection, the Mayor adjourned the Budget Study Session at 8:22 p.m. to Thursday, April 7, 2011 at 7:00 p.m. to meet to continue the 2011 Budget Study Session and to meet in closed session, if deemed necessary. 6 r 1/1, . ,] Cit Clerk City of Seal Beach Mayor r Attest: I City Clerk 1 I 1