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08-18-1993 - Budget Workshop CITY COUNCIL OF EDGEWATER WORKSHOP AUGUST 18, 1993 7:00 P.M. COMMUNITY CENTER MINUTES Call To Order Mayor Hayman called the Budget Workshop to order at 7 : 00 p.m. in the Community Center. Roll Call Mayor Jack Hayman Present Councilman Kirk Jones Present Councilwoman Louise Martin Present Councilman Michael Hays Present Councilman David Mitchum Present City Attorney Krista Storey Excused City Manager George McMahon Present City Clerk Susan Wadsworth Present Police Chief Lawrence Schumaker Present Overview of City Enterprise Funds Budget — Utilities Director and Public Works Director City Manager McMahon presented a recap of the General Fund budget with regard to suggested changes to the proposed budget made by Council at the Budget Workshop held last night and identified the necessary increase to the millage rate that would be needed. Review of City Enterprise Funds and Budgets Utilities Utilities Director Terry Wadsworth presented an overview of the Utilities Department budget by describing the good news/bad news scenarios associated with it with regard to the Water & Sewer Funds. City Manager McMahon asked the Council to think about what the City would do with regard to extending water and sewer lines . He further spoke of the need to add water customers as this was a profitable area for the City. They had impact fees set aside to allow for the extension of lines . It would be prudent and economically wise to extend those lines as the opportunity for customer base expands . He also spoke about the customers that would be looking towards reuse water which would reduce the amount of potable water they would be selling. He asked the Council to give this serious thought. 1 Council Workshop August 18, 1993 Councilman Hays spoke of a discussion that occurred two and a half years ago with Dick Kelton from Volusia County about service areas . They spoke of running water to Boston Whaler once the plant was complete. He felt the water service was a great idea but felt they should be careful getting outside the City with sewer service. He also spoke about charging an extra 20 or 25% when they go outside the City limits which make it a profitable business for them. The people that live south of Edgewater would love to have the water service. He really wanted to see them look at the feasibility of running a line down there. There was further discussion regarding water issues people were having south of Edgewater. Mayor Hayman asked Mr. Wadsworth to elaborate on his comment with regard to the revenue increases being behind the projections and the particulars associated with that, which he did at this time. Mayor Hayman commented on the City having 8 wells showing below the average mark. We were still number one on our consumption scale. He further commented on water conservation and consumer consumption. Mr. Wadsworth identified the City' s withdrawal rate had been lowered and he believed even though they were putting out more water they were below where they were a year ago. Councilman Hays felt people were more aware of water conservation. Mayor Hayman then commented on public awareness with regard to water conservation. Mr. Wadsworth further commented on water revenue and projected new water connections . There was a brief discussion regarding seeing more connections after the CIP was completed in Florida Shores . Mayor Hayman commented on projected growth in the community and the City experiencing another increase in impact fees within the next few months. He asked Mr. Wadsworth if he had a feel for the influence those fees would have. Mr. Wadsworth addressed Mayor Hayman' s concerns. Mr. Wadsworth continued his presentation by describing water revenue with regard to increases in service charges and penalties . He further commented on there being a significant decrease in interest projections . He also identified this was the first year they would be transferring money from the rate stabilization and construction fund. 2 Council Workshop August 18, 1993 Mr. Wadsworth then commented on wastewater with regard to an increase in sewer use sales due to the additional connections in Florida Shores as well as the projected additional connections. There was a discussion regarding the number of people that required financial assistance to connect to the sewer system through the Community Development Block Grant. There was some additional discussion regarding there originally being 26 people in Phase One being billed for sewer whether they connected up to the sewer system or not. Mr. Wadsworth answered questions presented by Councilman Hays regarding how he came up with the figures for the reuse sales and reuse connection fees . He further identified they had to provide a backflow prevention device to the water line, which was being done by the City and included in the $175 connection fee. He felt the $5 monthly fee and connection fee were very reasonable after comparing them with the surrounding area. Mr. Wadsworth further informed Council their connections would be set up so if at a point in time in the future the State wants to require that it be metered, ours were configured so they could insert a meter without modifying the whole connection, which was done intentionally. Mr. Wadsworth spoke of taking the reuse component out of the sewer assessment because it was unfair for effluent disposal to be picked up tab wise by Florida Shores. They anticipated they would have to have a rate increase to accommodate the difference but that didn' t turn out to be necessary. He further identified it would be user rate base. There was a brief discussion regarding when the Council should expect to see the ordinance. Mr. Wadsworth anticipated by December or January they should be ready to start putting reuse water out in the system. He further identified DER was being very cooperative and he didn' t think there would be any hold ups . Mr. Wadsworth identified again for Councilman Mitchum how he came up with the $150, 000 figure for reuse connections, which Mr. Wadsworth estimated was 800 connections at $175 per connection plus an additional $10, 000 for contingencies . Mr. Wadsworth had heard that because of the financial impact of the connection that people were going to wait a while and identified there were other factors that enter into the need for it, such as the weather. Mayor Hayman commented on St. Johns River Water Management District looking at ways to eliminate private wells for irrigation. 3 Council Workshop August 18, 1993 Mr. Wadsworth continued his presentation by describing the special assessment income was rolling in rather well. He further identified the money transfers, which may or may not be needed. Mayor Hayman identified the Miscellaneous Personnel Costs under Salaries and Wages was for the pay for performance package. Mr. Wadsworth then commented on the Water Expenditure Overview with regard to refilling a position that could not be filled last year. There was then a brief discussion regarding the Workmen' s Compensation rate increase which was a mandated expense the taxpayers were going to bare, with the premiums going up 12 . 12% from the previous year, from $253, 000 to $284, 000 . This problem was affecting everyone, not just government agencies . City Manager McMahon informed Council the safety program saved the City $33, 000 and without that, the rates would have gone up considerably more. Mr. Wadsworth answered questions presented by Councilman Hays with regard to the anticipated decrease in overtime. Mr. Wadsworth then identified what was included under Professional Services. There was further discussion regarding Travel and Per Diem, Transportation, Machinery and Equipment, and Renewals and Replacements. Mr. Wadsworth then answered questions presented by Mayor Hayman regarding the need to look at the older part of the community, particularly the business area, and whether there was money in the budget to address that area as well or if they were focusing their attention on the fire hydrants in Florida Shores . He agreed to start looking at this particular area as this year goes along and identified if it was impact fee eligible it didn' t have to be specifically budgeted. Mayor Hayman pointed out the debt service was going up. Mr. Wadsworth then presented an overview of the Field Operations Department budget. Mr. Wadsworth then addressed Machinery and Equipment at the request of Councilman Hays . There was a brief discussion regarding whether the car was essential and if it was cheaper for the City to pay per diem and mileage. 4 Council Workshop August 18, 1993 City Manager McMahon asked the Council to allow the expense to remain in the budget with the understanding he and Mr. Wadsworth would sit down and further evaluate this . Mr. Wadsworth then presented an overview of the Sewer Department budget with regard to an increase in personnel. City Manager McMahon asked Mr. Wadsworth to explain Other Contractual Services because of the significance of the percentage it went up, which he identified $8, 000 of this as being the County administration fee to process the assessments, which there was further discussion on. Councilwoman Martin asked about the $88, 000 increase in Utility Services and whether this amount would increase ever year. Mr. Wadsworth identified that as being the electric bill but felt it should pretty much remain the same unless there was a rate increase or other circumstances . Mr. Wadsworth then commented on Professional Services as it related to permitting and the reuse system. Councilwoman Martin asked about the increase in Books and Subscriptions, which Mr. Wadsworth described he had chosen to pay the Volusia City County Water Supply Cooperative out of Books and Publications this year to the tune of $14, 752 due to the significance in reuse. Police Chief Schumaker was excused at this . Mayor Hayman commented on taking a big hit within this department to workmen' s compensation to the tune of 70 . 4% . Mr. Munoz informed commented on the additional personnel in this department. There was a discussion regarding Promotional Activities as it related to putting out information for people to sign up for reclaimed water above and beyond putting information in the City' s newsletter. Mayor Hayman felt they may be able to capitalize on money from the Water Cooperative as well as St. Johns as they have money earmarked for that sort of thing. Mr. Wadsworth then commented on Machinery & Equipment and answered questions presented by Mayor Hayman with regard to improvements other than buildings at a cost of $150, 000. There was a brief discussion regarding hiring starting October 1st Refuse and Sanitation Mr. Williams then presented the Refuse and Sanitation Department budgets . 5 Council Workshop August 18, 1993 Mr. Williams answered questions presented by Mayor Hayman with regard to the truck that is used to pick up trash automatically dumping the trash. Currently the guys have to lift the cans to chest high in order to dump the cans into the truck. Mr. Williams commented on having a goal of eliminating one truck and identified there was one driver and two guys that pick up trash on each truck. Mayor Hayman further commented on what he felt was the safest way and most competitive, cost effective way of collecting trash with regard to the trash truck used picking up and dumping the can into the truck. City Manager McMahon spoke of this system being used in Maitland and further identified it slowed the pickups down but they saved on workmen' s compensation injuries . He felt they needed to be looking for more economical ways but felt they needed to look at the entire system in terms of economics . Councilman Jones spoke of New Smyrna Beach having that system in the past and they sold it because it slowed the process down. He further spoke of the problem of getting the people to use the cans . Mr. Williams commented on two new programs they were looking at that would reduce the trash flow that was being picked up with regard to composting and using a task approach which would allow the guys to go home when they finish their route. City Manager McMahon spoke of doing this in Maitland and it proving to be extremely effective. Mr. Williams then commented on improvements that needed to be made to the incinerator at the Public Works facility. There was further discussion regarding purchasing a new trash truck. Stormwater City Manager McMahon then commented on the Stormwater Department budget. City Manager McMahon complimented Mr. Williams for the work that was being accomplished and taking the initiative to do what needed to be done with regard to replacing culverts and pipes . The Florida Shores system was never designed right and the canals were never properly maintained or designed. Mr. Williams provided an update on the box culvert to be placed at Riverside and SR 442 as well as looking at reconstructing the bridge. 6 Council Workshop August 18, 1993 Mr. Williams at the request of Mayor Hayman provided an update on the results of the work done on Riverside Drive, just north of Indian River Boulevard, with regards to the drainage problem. Councilman Hays commented on certain areas of Edgewater having serious flooding problems when it rains . Mr. Williams then commented on the Stormwater Study that was done and not paying attention to it causing some of the problems. Councilman Hays wanted the flooding issue to be a goal and priority. City Manager McMahon informed Council of a proposed agreement they would be confronted with from the County with regard to stormwater drainage. He identified the City was not going to share in the cost of the County' s problem. Mayor Hayman spoke of the County starting to develop a stormwater master plan where most of the municipalities already have theirs in place and there being a disconnect. City Manager McMahon identified the City had excellent control of the situation from a physical standpoint. The canals of the County that provide additional water into our canals have to exit into the Indian River. If they cause a need to increase the size of the piping or the canals, he believed the County should pay for it. Mr. Williams then commented on a position that was vacant and things weren' t getting done. He further spoke of using a temp agency if the need should arise where they needed more bodies . Mayor Hayman spoke of looking at a part-time position instead of a full-time position and the savings as a result of using a professional employment agency. Mr. Williams then commented on the projects they were proposing for next year and the organizational chart. City Manager McMahon informed Council he had included in the proposed budget the staffing level at the grades for each department. City Manager McMahon and Finance Director Munoz then made a presentation with regard to the Self-Insurance Fund and answered questions presented by Council. Council questions and summary on proposed City budgets City Manager McMahon informed Council if they had no further problems with the budget to approve the tentative budget and millage recommended tonight and they would have that prepared for the first tentative budget meeting in September. 7 Council Workshop August 18, 1993 Council conclusion and decision on final tentative budget Finance Director Munoz identified instead of the 6. 6 mills they initially started the budget with, they were now looking at 5. 8882 mills, which represented a 26.53% increase over the roll forward rate of 4 . 65366. City Manager McMahon informed Council the bottom line of the budget was $5, 515,277 for a 1 . 4% increase over last year' s budget. Councilwoman Martin moved to approve the tentative budget, second by Councilman Hays . Councilman Mitchum pointed out they couldn' t do a motion at a workshop. City Manager McMahon explained it would be a consensus tonight and the actual motion for adopting the tentative budget would come at the first meeting in September. It was the consensus of Council to move forward with the tentative budget towards the public hearing. City Manager McMahon informed Council at the two public hearings they would review the budget for anybody' s information that may not be aware of it but they would not go back and redo the entire budget. The two public hearings would be held September 7th and September 13th City Manager McMahon thanked the staff and department heads who worked closely with him to make the budget a reality in terms of bringing costs down. He identified Finance Director Munoz had been a tremendous help to him. At the request of Councilman Jones, Finance Director Munoz explained why property values had decreased. Councilman Jones expressed concern with 50/50 with regard to the sewer assessment as opposed to the 1/3 for the property owner on one side of the street, 1/3 for the property owner on the other side of the street and 1/3 for the City. Finance Director Munoz and City Manager McMahon elaborated on his concern. Councilman Jones was anxious to see the figures for 50/50 . Councilman Hays was curious what the interest rates would be. City Manager McMahon informed Council they would have those figures and a proposed plan to them no later than 60 days but probably within 30 days . Adjournment There being no further business to discuss, Mayor Hayman adjourned the meeting. Minutes submitted by: Lisa Bloomer, CMC 8 Council Workshop August 18, 1993