JULY 10 2012 BUDGET WORKSHOP NO. 3

12-13 FISCAL YEAR GENERAL FUND & ANCILLARY FUNDS

Innovation will serve to keep the plan in the forefront of all that we do. Our actions should always be advancing the Plan.

Operation Innovation

Workshop Schedule

Schedule of FY 12-13 Council Work Sessions:

June 7- Budget Format Workshop* June 26- Capital Projects & Replacement/Renewal Fund

Workshop* July 10- General Fund (and smaller ancillary funds) Workshop** July 24- Enterprise Fund Workshop (Electric,

Telecommunications, Water/Sewer, Sanitation, Golf & Airport)* August 14-Preliminary Budget Presentation Workshop* TBA- 1st Reading Tentative Budget (Public Hearing) TBA- 2nd Reading Final Budget (Public Hearing)

*11:00 Council Lunch*11:30-1:30 Work Session (Council Chambers)** 3:00 pm Work Session (Council Chambers)

Items of Discussion

Reserve Policy Adjustment Fee increases (Development Services,

Engineering, Recreation & Parks, Telecommunications)

Proactive approach to curtailment of current year expenses

Continued culture and innovation enhancements

General Fund Balancing Strategies

FY 12-13 General Fund Information

The General Fund is the main operating fund of the City. As such it bears the brunt of costs associated with a majority of the City’s core functions.

The General Fund will be balanced using a millage of 6.1502, the Revenue Neutral Option, which allows the City to collect the same tax revenue as in the current fiscal year.

All cash balances available to the City, including a 20% reserve, have been incorporated into the budget in an effort to enhance the transparency of the budgeting process.

Salaries have been kept at current levels, as such there are no raises programmed into the budget.

Enterprise Fund transfers were held to FY12 levels. The General Fund will be balanced using the proposed fee

increases from Development Services, Engineering, Recreation & Parks.

The VSIP savings of ~$500,000 has been factored into the General Fund.

The City assumed the 2% increase in Health Insurance Premiums. The General Fund will be balanced using a transfer of $1M from the

1/8 mil Police & Fire Fund.

Millage Information

FY2012/2013 MILLAGE RATES

When setting the tentative millage rates, Council should consider:

1. The maximum millage rate that can be levied by a majority vote of City Council is the rolled-back rate adjusted per the new legislation.

2. A millage rate of not more than 110% of the rolled-back rate adjusted for growth may be adopted if approved by two-thirds vote of the City Council.

3. A rate in excess of the 110% described in #2 may be adopted if approved by a unanimous vote of City Council or if approved by a referendum.

Additional Millage Information

For comparison purposes, the following schedule lists the current rate, rolled-back, the maximum millage rate that can be imposed with a majority vote of City Council and the amount of revenue that would be generated for each, based on a 95% collection rate.

*Rolled Back Rate is not a tax increase

FY 12 Rate% Incr/Decr over

RBR Comments Vote

FY 13 Proposed Revenue @

95%FY 12 Actual

Revenue @ 95%Incr/Decr over FY 12 Revenue @ 95%

5.9332 -3.56% Current Rate FY 12 Majority $20,030,863 $20,888,517 ($857,654)

6.5276 6.11% Majority Vote Max Majority $22,037,595

6.1502 0.00% Rolled-back Rate Majority $20,769,546REVENUE

NEUTRAL OPTION

7.1804 16.72% 2/3rd Vote Max 2/3rd Vote $24,241,490

General Fund Deficit

Adopted YTD Revised Increase/ Increase/

FY 10-11 Budget Actuals Base Budget Decrease Decrease

  Actuals FY 11-12 FY 11-12 FY 12-13 Amount Percentage

CASH BALANCE FORWARD $0 $22,443,019 $21,512,427 $16,500,000

Revenues $50,808,008  $48,592,420  $38,280,936  $48,609,077  $16,657  0.03%

Transfers from Other Funds $11,358,680  $15,242,555  $10,053,018  $13,946,207  $(1,296,348) -8.50%

Total Revenues & Transfers $62,166,688 $63,834,975 $48,333,954 $62,555,284 $(1,279,691) -2.00%

Operating Expenditures $63,133,849  $64,730,249  $43,681,304  61,095,937  (3,634,312) -5.61%

Transfers  $3,333,077  $3,642,608  $2,759,521  3,739,756  886,414  24.33%

Total Expenditures $66,466,925 $68,372,857 $46,440,825 $64,835,693 $(2,747,898) -4.02%

REVENUES - EXPENDITURES $(4,300,237) $(4,537,882) $1,893,129 $(2,280,409)

General Fund Balancing Strategies

CASH BALANCE FORWARD (Estimated) $ 16,500,000

RESERVES  Revenues  $48,609,077 

Reserve For Fund Balance  $  12,942,139   Transfers In   $  13,946,207 

Reserve For Contingencies  $    1,110,128  $ 62,555,284

Reserve For Fire Grant Match  $          96,238 

Reserve For Affordable Housing  $        557,677   Expenditures   $  61,095,937 

Reserve For Tree Mitigation  $        115,351   Transfers Out    $    3,739,756 

Reserve For Discovery Science Center  $          20,000  $ 64,835,693

Reserve For Salaries/OT/Retire/VSIP  $        458,467 

Building Fund  $    1,200,000 

$ 16,500,000  Budget Gap   $  (2,280,409)

   Reserve Deficit   $                     0 

DEFICIT $ 0 TOTAL DEFICIT $(2,280,409)

STRATEGIES PERMANENT OPTIONS AMOUNT PRIORITY TEMPORARY OPTIONS AMOUNT PRIORITY

Comm Tech Consolidation (Fire Only)  $        476,973   Delay Fire Station  $     1,000,000  

Reduce Reserves to 19%  $        647,107   800 MHz Payment Transfer  $        300,000  

Reduce Reserves to 18%  $    1,294,214   Enterprise Funds Transfers  $     2,280,409  

OPD Reductions  $        700,000  Furloughs  $     1,800,000 

Insurance Changes  $        360,000 

Lay Offs  $    1,000,000  

Pay Cuts  $    1,500,000  

Questions/Comments