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FEDRAC MIN 02-23-2010CITV Of Federal Way City Council Finance SUMMARY Committee Members in AtFendance: Committee Chair Mike Park, Committee Member Jeanne Burbidge and Jack Dovey. Councilmembers in Attendance: Mayor Linda Kochmar, Deputy Mayor Dini Duclos and Councilmember Freeman arrived at 6:48 pm. Staff Members in Attendance: City Manager/Police Chief Brian Wilson, Financial Services Administrator Bryant Enge, City Attorney Pat Richardson, Finance Director Tho Kraus, Communications and Government Affairs Manager Linda Farmer, Assistant Police Chief Andy Hwang, and City Clerk Carol McNeilly. 1. CAII TO ORDER: Committee Chair Park called the meeting to order at 5:30 pm. 2. PUBLIC COMMENT: None. 3. COMMITTEE BUSINESS: Topic Title/Descrfptton A Approval of Minutes: January 26, 2010 Action Motion and second to approve the minutes as presented. Motion carried 3-0. B legislative Report: January 2010 Information City Lobbyist Doug Levy phoned in and stated the operating budgets from oniy * �he Senate and House were publicized this week. Five million in capital allocations were kept intact, however, there is no new funding for road projects. The House budget assumes passage on storm-water taxes, while the Senate budget does not. The Senate budget includes 3 tenths of one cent increase for sales tax revenue. The House budget included more tax , increases. There was a hearing on Senate bill 6051 today, the bilt would require housing money put towards it in order to stay alive. Communications and Government Affairs Manager Linda Farmer provided a Federal Legislative report. She stated the majority of activity was centered on a 2011 appropriations requests for the Triangle project. She along with Councilmember Burbidge, Deputy Mayor Duclos and Mayor Kochmar will be lobbying in WA DC for project funding in early March. COMMITfEE MEMBERS: CITY STAFF: Mike Park, Chair Bryant Enge, Financial Services Administrator Jeanne Burbidge Carol McNeilly, City Clerk Jack Dovey 253.835.2540 R�. �::.r��.r.�. at r ���>> � :;z�sl� .. � # ��:• .. . _ __ _ C Early Replacement of Police Vehicle #526 Assistant Police Chief Andy Hwang stated a 2004 Dodge Intrepid police vehicle had an engine fire in January. The thermostat and water pump have been replaced in the vehicle, however, it is suspected that there is internal damage to the vehicles engine that may cause ongoing issues. Rather than repair the engine, staff is requesting early replacement of the vehicle, which is schedule for replacement in 2011. Funding to reptace the vehicle will come from the replacement reserves. Motion and second to replace vehicle. Motion carried 3-0. D 2009 JAG Grant and Memo of Understanding Assistant Police Chief Andy Hwang stated staff is seeking approval to accept a grant for $49,431 to purchase equipment that will allow the Police Department to issue electronic tickets and accident reports, which would then be downloaded into their computer system, eliminating a large amount of data entry. Motion and second to forward to the March 2, 2010 City Council meeting for approval. Motion carried 3-0, Council Consent 3/2/2010 Council Consent 3/2/2010 E Animal Services Unit Funding Source information Finance Director Tho Kraus stated startup costs for an Animal Services oniy* Division in the Police Department is estimated at $300k. The one time cost would be funded as follows: $58k from Police excess Reserves and Surplus Property, $92k from additional reserves which is part of the 2010 carryforward request, $100k from fuel savings and $SOk from pet licensing fees from King County. Ongoing cost, which are estimated at $338k for 2011 through 2014 would be funded by pet licensing fees of $204k, and fuel cost increases that are currently projected in the long range financial plan of $134k. The committee discussed the funding options for the Animal Services Division. Staff will review alternate funding options and return to the committee and a later date. Assistant Police Chief Andy Hwang stated King County Animal Care and Control is aware that the City will be forming their own Animal Control Unit and no longer contracting with the for services. F Resource Conservation Management Program Financial Services Administrator Bryant Enge stated this position is related to the energy conservation grants the city has been awarded. The program requires the energy improvements that are implemented to be monitored by a Resource Conservation Manger. The City is proposing to share a resource manager with the City of Auburn. This position would be responsible for monitoring th'e city's investment to ensure we are reaching our targeted savings as well as working with staff to make sure the city maximized its energy conservation. Washington State University and Puget Sound Ener�y have pro�rams that would subsidize the costs Council Consent 3/2/2010 _ _ __ __ _ Motion and second to forward the item to the March 2, 2010 City Council meeting for approval. Motion carried 3-0. G Carry-Forward Budget Adjustments - Ordinance intro Finance Director Kraus reviewed details of the proposed 2010 Carry- ordinance Forward Budget Adjustment and provided the results of the General and 3/2/20�0 Street Fund 2009 operations. The combined General and Street Fund ended 2009 with $1.4M above the projected ending balance. Actual expenditures were $1.SM below budget, operating revenves were $286K above projections and one-time grant revenues were down by $390K. The entire $1.4M is needed to fund the proposed carry-forward adjustment which includes $1,069K for continuation of existing programs; $467K for grant funded projects, $30K in technical adjustments and $363K for new programs. New program requests include a total of $16K in City Manager's Office for Enterprise Seattle dues increase and electronic communications system start-up costs, a total of �7K in Community Development for temporary help for CDBG feasibility study and ongoing graffiti machine m&o; a total of $122K in Police for replacement of three patrol supervisor vehicles, increase in excess fleet reserves, and retention one additional secondary vehicle; $20K for City Hall street lights, and $200K in Risk Management for future pending insurance deductibles. Ms. Kraus noted the City is taking a proactive and conservative approach by including a total of $435K in the proposed budget adjustment for sett►ed, pending and future insurance deductibles. Ms. Kraus also highlighted other fund's budget adjustments noting that of the $44.1 M total adjustment, $39.6M is for capital projects which includes $61 K transfer of emergency equipment savings back to the General Fund, closing out $86K unallocated FW Community Center CIP to FW Community Center operating fund capital reserves, and closing out $151 K from the sale of old City Hall to the building fund replacement reserves to help cover some items that are either not accumulating enough reserves or not coltecting at all such as the HVAC and security system. Motion and second to forward the ordinance to first reading at the March 2, 2010 City Council meeting. Motion carried 3-0. H Final 2009 Monthly Financial Report councii Finance Director Kraus reviewed the December 2009 Monthly Financial consent Report. General and Street Fund operating revenues came in $286K 3/2/2oto above projections with increases in property tax, intergovernmental, gambling tax, court revenue, parks 8� recreation fees, police services, permits 8� developments fees, interest/miscellaneous/other up offset by decreases in franchise fees and prop 1 utility tax transfer. Expenditures were below budget by $1.5M with all departments within budget with the exception of Court due to legal and settlement fees. The $1.5M savings is above and beyond the $630K 1-time savings projected during the mid- biennium adjustment. Ms. Kraus highlighted what contributed to each department's savings and noted Parks department savings of $34K is due to wire theft budget not spent and parks maintenance savings of $112K offset by increases in general recreation expenditures of $125K. During the mid-biennium, general recreation revenues were projected to increase by $175K with no expenditure increases. It is expected general recreation _ ___ _ expenditures will continue to exceed budget in 2010 but will be covered within the current Generai Fund budget and wiil be considered as part of the 201 1/12 budget process. Ms. Kraus stated sales tax through February 2010 is $1 1 K above estimates. Ms. Kraus highlighted year-end results of REET, utility tax, Traffic Safety Fund, and Federal Way Community Center. Utility tax revenue came in $189K below budget, net of $70K back taxes received in 2009. Ms. Kraus stated that based on the current trend, the estimated cumulative utility tax shortfall for 2010 - 2014 could be $5.8M. Federal Way Community Center revenues came in $8K below budget, expenditures were on target, and $72,900 of capital reserves was used in 2009 to cover the $8K revenue shortfall and repay 2008's $65K interfund loan. General Recreation picked up $30K of FWCC internal service charges in 2009 to more appropriately account for General Recreation's usage of the facility. Beginning in 2010, General Recreation will begin paying FWCC $25K annually for facility usage which Council approved during the mid-biennium adjustment. Motion and second to forward monthly financial report to the March 2, 2010 City Council meeting for approval. Motion carried 3-0. VouChefs Council Motion and second to forward the vouchers to the March 2, 2010 City consent Council meeting for approval. Motion carried 3-0. 3/2/2oio 'Handouts/additional information may be distributed ai ihe meeting. 4. OTHER: City Manager/Police Chief Wilson provided a brief update on the Braches Garden Center Code Violation. 5. FUTURE AGENDA ITEMS: None 7 6. NEXT MEETING: Tuesday, March 23, 2010 7. ADJOURN: Chair Park adjourned the meeting at 7:35 pm.