City of sanger
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Transcript of City of sanger
CITY OF SANGEROverview of 2011 proposed budget
REVIEW OF 2010 BUDGET
Defunded Five Positions Maintained Service Levels Continued Infrastructure Improvements Cut spending early to avoid impacting
services Avoided layoffs and furloughs by leaving non-
essential positions open when possible Added Debt Service Fund and Capital
Improvement Fund and Merged Smaller Departments
2011 BUDGET HIGHLIGHTS
Department Name Changes Parks is now Parks & Recreation Data Processing is now Finance
Reclassifying Accounting Tech. Position to Finance Director
No Merit Raises Planned for 2011 Significant Cuts in Operating Expenses Funding for Capital Projects Maintained
2011 BUDGET HIGHLIGHTS
2008 2009 Current$0.00
$100,000.00
$200,000.00
$300,000.00
$400,000.00
$500,000.00
$600,000.00
General FundEnterprise Fund
Continue to Build Reserves
SWOT ANALYSIS
Strengths Location, Location, Location Quality of Life Electric Utility 4A & 4B
SWOT ANALYSIS
Weaknesses Dependence on
Property Tax Ratio of
Residential to Commercial
Median Home Price
Water CCN
SWOT ANALYSIS
Opportunities Industrial Development Residential Development Commercial Development
Threats Depreciation of Property Values Decreased Sales Tax Revenues Increased Cost of Goods & Services Lack of Emergency and Operating Reserves
UNDERSTANDING THE BUDGET
Six Semi-Autonomous Funds General Fund Enterprise Fund 4A Economic Development Funds 4B Economic Development Fund Debt service Fund* Capital Improvement Fund*
* New Funds
UNDERSTANDING THE BUDGET
Budget Process Spring – Staff begins estimating revenues
and expenses and researching the cost of capital projects and equipment
Early Summer – Staff submits proposed budget to City Manager – City Manager balances revenues and expenditures
Summer – Council holds workshops and public hearings on the budget
UNDERSTANDING THE BUDGET
Budget Process Continued September Final Budget is Adopted October First – New budget begins January Property Tax revenue starts
coming in and Capital purchases begin April – Process starts again for next year
IMPORTANT POINTS
Revenues are estimates Revenues do not appear in the bank
October First – they come in over the year
Revenue shortfalls mean cutting expenditures
City Operates on a Cash Basis Conservative revenue estimates Control of costs and budget
management
IMPORTANT POINTS CONTINUED
A large proportion of our costs are set costs and are unchangeable. This includes bond and lease payments
Another large portion of our costs are “automated”, meaning that we do not control the increases. This includes all insurance and water purchases
The bulk of the rest is “current” costs or what it takes to maintain current service levels
What little, if any, that is left can be used for capital improvements, increased personnel benefits or increased service levels
UNDERSTANDING THE PROPERTY TAX Property Taxes Collected in January 2011
are based on Property Values from 2009 Property Tax is Made up of Two Components
Interest & Sinking Rate (I&S) Maintenance and Operation Rate (M&O)
I&S Rate is Determined By Debt Obligations M&O Rate is Determined By Council I&S Rate is About 19¢ M&O Rate is About 43¢
UNDERSTANDING THE PROPERTY TAX Effective Rate – Rate that will service the
debt (I&S) and generate the same amount of operating money (M&O) as last year
Rollback Rate – 108% of Effective Rate. Any increase over the rollback rate is subject to challenge by petition
Setting a rate below the Effective Rate means a decrease in revenue. That decrease comes 100% from the M&O rate
UNDERSTANDING THE PROPERTY TAX Property Tax Varies Widely from City to
City Based on Many Factors Sanger’s is About Average for the Area
and for Cities With a Similar Size and Valuation
Lowering the Property Tax Long Term Requires A Higher Ratio of Commercial to Residential Higher Residential Values Carefully Managing Debt
GENERAL FUND
Expenditures Revenues
Property Tax Sales Tax Court Fees Fire and EMS fees Franchise Fees Enterprise fund
Transfers
Public Safety56%Community
Services21%
Public Works11%
Admin. & Support12%
General Fund
ENTERPRISE FUND
Composed of revenue generating utilities (Water, Wastewater, Electric)
Intended to generate revenues in excess of costs
Excess Revenues can be used for infrastructure improvements and help support the General Fund
Currently only Electric generates significant excess revenues
ENTERPRISE FUND
REVENUES VS EXPENSES
NO RATE INCREASE
2010-2011 Proposed Water Wastewater Electric
Total Operation Cost
$ 1,143,594.00
$ 820,632.00
$ 6,661,290.00
Total Capital Cost $ 458,361.00
$ 139,278.00
$ 419,739.00
Projected Revenue
$ 1,245,333.00
$ 1,045,333.00
$ 7,795,333.00
Revenue over (under)
$ (356,622.00)
$ 85,423.00
$ 714,304.00
Balance $ 443,105.00
2010 RATE STUDY
Water currently operates at a deficit Wastewater barely breaks even Electric is supporting the other
enterprise utilities Water and wastewater rates need to be
raised incrementally over the next few years to lessen the impact on customers
WHY RATE INCREASES ARE NECESSARY To bring water out of operating at a
deficit To save money toward the new
wastewater plant (Save 10% of wastewater revenues)
To help pay for the new wastewater plant when it is built
To help pay for some water and wastewater capital improvements without having to go into debt
PROPOSED RATE INCREASE
Water and Wastewater – 10% increase except for residential base rate increase of 6%
Will work out to be a 7% to 8% increase for residential customers
This is the same as last year Will still leave us generally below the
average on utility rates of cities in the area of similar size
IMPACT ON RESIDENTIAL CUSTOMERSImpact Current Proposed % Change $ Change
Residential
Water
Residential customers using:
4000 gallons a month $ 23.80 $ 25.55 7% $ 1.75
Wastewater
Residential customers using:
4000 gallons a month $ 23.75 $ 25.50 7% $ 1.75
ECONOMIC DEVELOPMENT FUNDS
Revenues from Sales tax (1/2c each) 4A Expenditures
Warehouse 4B Expenditures
Sports Park Administrative Costs – Requesting
$18,000 from each this year
DEBT SERVICE AND CAPITAL IMPROVEMENT FUND
Created to make general fund budget more understandable
Also helps track project costs Debt Service Fund is funded by the I&S
Rate Capital Improvement Fund is an
internal service fund where bond proceeds are deposited and expended on projects
CONCLUSION
The goose and the Golden Egg
GENERAL FUND DEPARTMENT HIGHLIGHTS
NON-DEPARTMENTAL
Used for expenses that do not fit inside one department
Includes Postage, Property and Liability Insurance and Tax Collections
Also includes line items for Keep Sanger Beautiful and Park Board for better tracking of expenses
CITY COUNCIL
Split 50/50 between GF & EF No major changes this year
ADMINISTRATION
Split 50/50 between GF & EF Moved TML Insurance and Tax
Collections to Non-Departmental Moved Administrative Assistants Salary
from Data Processing (Finance) to Administration
PUBLIC WORKS ADMINISTRATION
Split 50/50 between GF & EF No Major Changes
POLICE DEPARTMENT
Includes $7000 to support the Child Advocacy Center
Funds to purchase and equip only one vehicle next year
Includes $38,000 for Dispatch Services from the County
ANIMAL CONTROL
No Major Changes
FIRE DEPARTMENT
Includes two grants totaling $40,000 in matching funds if grants are awarded
Does not include SAFER grant Adds funds for dispatch services
AMBULANCE
No Major Changes
COURT
No Major Changes
DEVELOPMENT SERVICES
No Major Changes
STREETS
$100,000 for street improvements to be used for leveraging County funds
$50,000 for continued sidewalk expansion
Moved two positions from Parks to Streets to reflect new workforce structure
PARKS & RECREATION
Moved two positions to Streets Now includes the Sullivan Center and
Community Center budgets
FLEET SERVICES
No Major Changes
LIBRARY
No Major Changes
ECONOMIC DEVELOPMENT
Pared back to reduce Transfers from 4A & 4B
ENTERPRISE FUND
NON DEPARTMENTAL
Includes Safety & Incentive and One Plus Fund
Includes line item for reimbursement of Damage Claims
Includes $50,000 in contingency reserve to hedge against revenue shortfalls and for emergencies
FINANCE
Used to be Data Processing Reclassified Accounting Clerk to
Finance Director Moved Administrative Assistant to
Administration
WATER
$40,000 in contingency reserve for unexpected repairs
$50,000 in water line improvements
WASTE WATER
$150,000 for Wastewater system improvements including I&I study
ELECTRIC
Includes $125,000 for lighting at the Sports Park
Includes $90,000 for system Improvements
Includes funds for a stump grinder that will be shared with other departments
4A
Looking at funding significant utility improvements in the industrial area
Approximately $400,000 fund balance Requesting Transfer of $18,000 to
Economic Development Department
4B
Pledged $180,000 to Sports Park Fund Balance of Approximately
$500,000 Requesting $18,000 for Transfer to
Economic Development Department
SUMMARY
Planning on another lean year Continue to fund capital improvements
to aging infrastructure Continue to build reserves Continue planning and preparing for
the future