1 presented to the city council by dale fisseler, city manager karen l. montgomery, assistant city...
TRANSCRIPT
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Presented to the City CouncilBy
Dale Fisseler, City Manager
Karen L. Montgomery, Assistant City ManagerHoratio Porter, Budget Officer
August 11, 2009
City Manager’s Proposed Budget FY2010
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Economic Drivers and
Update of 5 Year Financial Forecast
Karen MontgomeryAssistant City Manager
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June 2008 Unemployment
- National 9.5%
- State 7.5%
- DFW 8.2%
Consumer Confidence In 1985 = 100%
- June 2009, National = 46.6%
- June 2009, State = 73.3%
National Gas Production Tax Collections are down 42% for FY2009
Dow Jones Industrial Average History 2008-2009
Overview of FY2010Economic Drivers
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2008 2009
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The recession has hit Fort Worth
Overview of FY2010Proposed Budget
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Revenue Impacts
-Foreclosure increase
-Unemployment rate climbing
-Decline in retail sales
-Decline in construction
-Decline in gas well drilling
-Decline in interest income
Expenditure Impacts
-Continued growth: infrastructure demands & other services
-Rising pension costs
-Rising healthcare costs (employees & retirees)
-Increasing contractual costs
-Fewer employees; less pay
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Overview of FY2010Proposed Budget - Recommendation
• Overview of CFW budget– $1.2 billion – Comprised of 20 different operating funds
• General Fund represents 41% of all expenditures
• March 2009:– 5 year financial forecast– GF expenditures outpacing revenues– Budget discussions considered impact on forecast
• Forecast updated for Proposed FY2010 Budget
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Navigating the Fiscal Crisis Audio Conferences
• Opportunity in Crisis– Improve the Organization – Resize or Restructure– Develop New Partnerships– Focus on Community Priorities– Proactive, not Reactive– Embrace the Future’s Possibilities
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Navigating The Fiscal CrisisFiscal Monitored Communities
• East Providence, RI Polk County, FL• Hickory, NC Prince William County, VA• Jefferson County, CO Rancho Cordova, CA• Las Vegas, NV Rockville, MD• Overland Park, KS San Antonio, TX• Phoenix, AZ Washtenaw County, MI
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Navigating the Fiscal CrisisAudio Conferences
• What type of strategies are you deploying now to prepare your community for the future?
– “Long Term Planning and Forecasting” Rockville, MD
– “5 year balanced fiscal plan” Prince William County, VA
– “Making real changes that will insure our long-term solvency while protecting core services” and “Telling our elected officials that there will be no easy decisions and no quick fixes” City of Hickory, NC
• City of Fort Worth’s response? All of the above
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Navigating the Fiscal CrisisAudio Conferences
• What is your prediction for the duration of the economic downturn?
– “Planning horizon is five years with expenditures outpacing revenues creating shortfalls in each of the next fiscal years ranging from $43-67 million” San Antonio, TX
– “2007 Tax Base could be lost until 2018 or later; 2012 is the earliest that property tax revenues would begin to increase Washtenaw County, MI
– “Current 5-Year Financial Plan [2010-2014] projects sales tax stabilization during 2011 and deterioration of property valuation until 2012” Overland Park, KS
• City of Fort Worth’s response?
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Updated 5 Yr Financial Forecast
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$400
$450
$500
$550
$600
$650
$700
FY05
FY06
FY07
FY08
Re-
est
FY09
FY10
FY11
FY12
FY13
FY14
Mill
ions
Revenues Baseline Expenditures
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Original 5 Yr Financial Forecast
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$400
$450
$500
$550
$600
$650
$700
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
Mill
ions
Revenues Baseline Expenditures
Gap = $58M
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Proposed BudgetPolicy Recommendations
• Recommend rescinding policy capping mineral valuesImpact on FY2009 and FY2010 - $6.7 million• Directions Home - $3 million • Vacation Buyback for Gen Employees - $3 million
• Recommend earmarking $5 million for pension • Committee to study alternatives before disbursing funds
• Recommend additional $5 million for retiree healthcare liability instead of $10.9 million
• Limit coverage to eligible employees through FY2020
• Recommend retaining the General Fund 10% reserve policy • Short term, one time infusion of funds
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FY2010 Proposed BudgetRecommendations
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• Service Reductions•Citywide Initiatives•Organizational Changes and Consolidations•Revenue Enhancement
•Proposed Fee Changes•Employee Impact
Horatio PorterBudget Officer
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Overview of FY2010Proposed BudgetBudget Recommendations
Service Reductions
Organizational Changes
Citywide Initiatives
C
B
Enhance Revenues
$59 millionbudget shortfall
A$16 m
$25 m
$3 m $15 mD
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The proposed budget necessitated curtailing spending through departmental and citywide reductions and vacancy management.
Budget Impact of Service Reductions - $16M
FY2010 RecommendationsService Reductions
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FY2010 RecommendedService Reductions
Elimination or Reduction of Operations and Programs at City facilities, eliminating 66.25 APs:
Service Reductions AP $$
Reduce Hours at Animal Shelter/Kennel 3.00 $103,992
Reduce Education Programs at Botanic Garden 3.00 $176,232
Reduce Staffing at Community Centers for After School Programs
6.00 $188,512
Eliminate 2 Mechanic Positions within the Fire Dept 2.00 $96,924
Service Reductions - Sub Total 14.00 $565,660
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FY2010 RecommendedService Reductions (cont.)
Service Reductions AP $$
Close Day Labor Center Operations 2.50 $271,462
Eliminate Right of Way Maintenance 0.00 $283,000
Reduce Staffing Dedicated to Monitoring Illegal Dumping
6.00 $351,012
Close 6 of the 7 Swimming Pools 2.00 $444,961
Realign Code Districts 6.00 $466,320
Service Reductions - Sub Total 16.50 $1,816,755
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FY2010 RecommendedService Reductions (cont.)
Service Reductions AP $$
Reduce Street and Traffic Operations Maintenance 9.00 $535,605
Eliminate the Late Night Program 10.00 $577,041
Forgo any Additional Alleyway Maintenance 1.00 $622,012
Close 2 Branch Libraries (Meadowbrook and Wedgwood)
15.75 $813,194
Service Reductions - Sub Total 35.75 $2,547,852
Total Reduction of Operations and Programs 66.25 $4,930,267
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FY2010 RecommendedService Reductions (cont.)
Reduction of Citywide Maintenance, Eliminating 22 APs:
Service Reductions AP $$
Reduce Staffing for Bridge Maintenance 1.00 $53,964
Reduce Athletic Fields Maintenance - $62,501
Reduce Staffing for Pavement Management Program
5.00 $85,718
Reduce Staffing for Urban Forestry Program 2.00 $101,280
Service Reductions - Sub Total 8.00 $303,463
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FY2010 RecommendedService Reductions (cont.)
Service Reductions AP $$
Eliminate Graffiti Abatement in General Fund 2.00 $134,451
Reduce one Forestry Hazard Abatement Crew 4.00 $138,516
Reduce Staffing for Facilities Maintenance 5.00 $295,804
Reduce Mowing Frequency 3.00 $424,060
Service Reductions - Sub Total 14.00 $992,831
Total Citywide Maintenance Reductions 22.00 $1,296,294
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FY2010 RecommendedService Reductions (cont.)
Elimination of Special Services:
Service Reductions AP $$
Eliminate Employee PAY$ suggestion program - $32,400
Reduce frequency of Citizens Survey to biennial - $48,000
Reorganize/Reduce Youth and Adult Sports Program schedule
- $102,689
Eliminate funding for FY10 Charter Election - $604,566
Service Reductions - Sub Total 0.00 $787,655
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FY2010 RecommendedService Reductions (cont.)
Elimination of Subsidies:
Service Reductions AP $$
Eliminate City Hall Cafeteria subsidy - $40,000
Eliminate Cable Office General Fund subsidy - $216,135
Service Reductions - Sub Total 0.00 $256,135
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FY2010 RecommendedService Reductions (cont.)
Reduction of Contractual Services:
Service Reductions AP $$
Reduce Legislative consulting services - $68,200
Reduce Outside Attorney Fees - $150,000
Eliminate Sunset Review contractual Services - $216,960
Reduce Audit Fees - $570,000
Service Reductions - Sub Total 0.00 $1,005,160
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FY2010 RecommendedService Reductions (cont.)
Transfer Functions to Alternate Funding Sources:
Service Reductions AP $$
Transfer Storm Water Compliance Efforts to Environmental Protection Fund
1.00 $73,615
Transfer Nature Center operations to Friends of the FW Nature Center
2.00 $117,068
Transfer Staff to Grant and Special Trust Funds 2.40 $174,813
Transfer Development Review/Project Manager positions to Capital Projects Service Fund
6.00 $332,427
Service Reductions - Sub Total 11.40 $697,923
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FY2010 RecommendedService Reductions (cont.)
Miscellaneous reductions*:
Service Reductions AP $$
Various positions throughout the City that provide administrative support. Also includes salary savings, supplies, and miscellaneous services.
45.40 $7,018,651
Service Reductions - Sub Total 45.40 $7,018,651
*Detailed descriptions are available in the FY2010 Proposed Decision Package Book.
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FY2010 RecommendedService Reduction Recap
SUMMARY AP $$
Reduction of Operations and Programs Sub Total 66.25 $4,930,267
Reduction of Citywide Maintenance Sub Total 22.00 $1,296,294
Reduction of Special Services Sub Total 0.00 $787,655
Reduction of Subsidies Sub Total 0.00 $256,135
Reduction of Contractual Services Sub Total 0.00 $1,005,160
Transfer Functions to Alternate Funding Sources Sub Total
11.40 $697,923
Miscellaneous Service Reductions 45.40 $7,018,651
Service Reductions – Grand Total 145.05 $15,992,085
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AP REDUCTION BY SERVICE GROUP
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Management Services
12.008%
Neighborhood Services
77.6554%
Infrastructure Services
50.0034%
Public Safety/Econ Develop
5.404%
General Fund only
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FY2010 RecommendationsCitywide Initiatives
Recommendation TOTAL
Fund Balance $7,500,000
Modify Retiree healthcare benefits ($10.9M vs $5M) $5,900,000
$3,900,000
Eliminate Third Contribution to Housing Fund $2,000,000
Reduce Medstar subsidy back to FY2008 level $2,000,000
Reduce Non Civil Service Vehicle Purchases $1,500,000
Reduction in Discretionary Spending $1,000,000
$779,000
Reduce Spending for Non Civil Service Uniforms $220,000
Total Citywide Initiatives $24,799,000
Eight (8) mandatory furlough days – equivalent to a 3% salary reduction for general employees
Reduce Funding to Non Profit Agencies
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FY2010 RecommendationsNon Profit Funding
Adopted ProposedFY2009 FY2010 Variance
Arts Related FundingArts Council* 1,220,484$ 1,000,000$ (220,484)$ Community Arts Center 200,000 200,000 Van Cliburn 100,000 100,000 Artes de la Rosa 60,000 60,000 Imagination Celebration 50,000 (50,000)
Total Arts Related funding 1,630,484$ 1,360,000$ (270,484)$
Agency FundingSafe Haven 90,000 90,000 Women's Center 75,000 75,000 Alliance for Children 63,998 64,000 2 Resource Recovery Council 50,000 50,000 Tarrant County Recovery Campus 51,000 51,000 Tarrant County Youth Collaboration 15,000 15,000
Total Agency Funding 344,998 345,000 2
Subtotal of Non Profit Funding 1,975,482$ 1,705,000$ (270,482)
Convention and Visitor's Bureau 7,622,527$ 7,622,527$ -
* Excludes Public Art Funding
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FY2010 RecommendationsNon Profit Funding
Adopted ProposedFY2009 FY2010 Variance
Other FundingMusuem of Science and History 572,149 500,000 (72,149) Sister Cities 378,420 (378,420) Safe Cities Commission - Police 60,195 60,195 - World Affairs Council 33,000 (33,000) North Texas LEAD - HR 25,000 20,000 (5,000) Corporate Champions 10,000 (10,000) ICMA 5,400 (5,400) Tarrant County Veterans Council 5,000 (5,000)
Other Funding 1,089,164$ 580,195$ (508,969)
Total Non-Profit Funding 3,064,646$ 2,285,195$ (779,451)$
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FY2010 RecommendationsRevenue Enhancements
REVENUE ENHANCEMENT TOTAL
Revenue from change in Policy on Mineral Values 6,700,000$
Assess a Payment in Lieu of Ad Valorem Taxes on Enterprise Funds 4,200,000$
Collect Outstanding Court Fines Thru Collection Agency 1,500,000$
General Fund Fees Increases 1,470,000$
Increase Collection of Third Party Residential Inspections Revenues 1,300,000$
Total New Revenue 15,170,000$
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Proposed Fee ChangesGeneral Fund Revenue Increases from Proposed Fee Changes
Department Increased Revenue
Parking Fees $470,000
Code Compliance $463,000
Transportation & Public Works $243,000
Parks & Community Services $168,000
Fire Department $126,000
Total $1,470,000
Other Funds Increases from Proposed Fee Changes
Fund Increased Revenue
Storm Water Utility $5,404,000
Water & Sewer $1,535,000
Solid Waste $1,328,000
Office Services $192,000
Municipal Golf $88,000
Total $8,547,000
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Account Number: XXXXXX-XXXXXXTotal Charges: $76.13Current charges due on 05/01/10After 05/24/10 Amount Due $79.94
WATER Current reading 368.7 Previous Reading 358.0 Water use in CCF 10.7
Service Charge 7.008.0 CCF @ $1.90 15.202.7 CCF @ $2.66 7.18 WATER SUBTOTAL $29.38WASTEWATER Service Charge 5.10 6.2 CCF @ @2.64 16.37WASTEWATER SUBTOTAL $21.47
SANITATION Service Charge 18.50 Garbage sales tax 1.53SANITATION SUBTOTAL $20.03
ENVIRONMENT Environmental Protection Fee .50ENVIRONMENT SUBTOTAL $.50
STORM WATER UTILITY Service charge 4.75STORM Water UTILITY SUBTOTAL $4.75
$76.13
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Account Number: XXXXXX-XXXXXXTotal Charges: $76.13Current charges due on 05/01/10After 05/24/10 Amount Due $79.94
Late Fee inclusio
n
Late Fee inclusio
n
WATER Current reading 368.7 Previous Reading 358.0 Water use in CCF 10.7
Service Charge 7.008.0 CCF @ $1.90 15.202.7 CCF @ $2.66 7.18 WATER SUBTOTAL $29.38WASTEWATER Service Charge 5.10 6.2 CCF @ @2.64 16.37WASTEWATER SUBTOTAL $21.47
SANITATION00 Service Charge 18.50 Garbage sales tax 1.53SANITATION SUBTOTAL $20.03
ENVIRONMENT Environmental Protection Fee .50ENVIRONMENT SUBTOTAL $.50
STORM WATER UTILITY Service charge 4.75STORM Water UTILITY SUBTOTAL $4.75
$76.13
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• No across the board or step increases for general or fire employees
• Eliminate tuition reimbursement
• Offer $10,000 incentive to eligible general employees for retirement by 12/31/2009. – Currently have 170 individuals that are eligible– We assume that 25% or 42 individuals will participate
FY2010 RecommendationsEmployee Impact
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• Furlough – 8 days, 3% reduction in pay, 10% pay reduction in pay period of furlough day
FY2010 RecommendationsEmployee Impact – Furlough Days
Columbus Day Monday, October 12, 2009
Day Before Thanksgiving Day Wednesday, November 25, 2009
Christmas Eve Thursday, December 24, 2009
Presidents' Day Monday, February 15, 2009
Good Friday Friday, April 2, 2010
Friday Before Memorial Day Friday, May 28, 2010
Friday Before Independence Day Friday, July 2, 2010
Friday Before Labor Day Friday, September 3, 2010
FY2010 Proposed Furlough Days
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• Reduction in Force (RIF) of 188 Citywide APs (114 filled, 74 vacant)– 134 General Fund APs (85.0 – filled, 49.0 vacant)– 54 Other Fund APs (29.0 filled, 25.0 vacant)
FY2010 RecommendationsEmployee Impact – RIF Timeline
August 11th City Manager presents FY2010 Proposed Budget
September 15th City Council adopts FY2010 Budget
September 16th Employees receive RIF notification
September 17th Human Resources meet with RIF employees
September 21st Human Resources begin referral process
November 6th RIF Effective date
November 5th 2010 End of preferential rehire status
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• Vacation Buy Back option for eligible
general employees – 40 hours equivalent to 2% salary
• Longevity Pay is included for those eligible employees
• Open a Health Clinic in FY2010
FY2010 RecommendationsEmployee Impact
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Proposed Budget General Fund FY2010 - Balanced
ADOPTED ADOPTED PROPOSED VARIANCE VARIANCEFY2008 FY2009 FY2010 $ %
Property Tax $324,907,629 $293,055,766 $292,440,666 ($615,100) -0.21%
Sales Tax $99,583,863 $104,536,265 $98,866,422 ($5,669,843) -5.73%
Other Local Taxes $9,297,234 $9,515,000 $9,077,500 ($437,500) -4.82%
Licenses & Permits $53,899,857 $44,222,278 $44,022,974 ($199,304) -0.45%
Fines & Forfeitures $13,727,486 $12,528,370 $13,168,383 $640,013 4.86%
Use of Money & Property $17,697,559 $14,263,915 $4,792,100 ($9,471,815) -197.65%
From Other Agencies $1,068,420 $1,168,420 $1,262,953 $94,533 7.49%
Service Charges $25,714,687 $24,964,394 $23,524,849 ($1,439,545) -6.12%
Other Revenue $1,338,262 $1,450,137 $1,100,204 ($349,933) -31.81%
Transfers $15,497,208 $33,282,607 $39,960,498 $6,677,891 16.71%
$562,732,205 $538,987,152 $528,216,549 ($10,770,603) -2.04%
PERSONNEL $357,429,610 $369,030,244 $375,553,394 $6,523,150 1.74%SUPPLIES $25,569,341 $27,838,254 $25,926,858 ($1,911,396) -7.37%CONTRACTUAL $126,234,552 $140,048,854 $125,015,297 ($15,033,557) -12.03%CAPITAL OUTLAY $53,498,702 $2,069,800 $1,721,000 ($348,800) -20.27%
$562,732,205 $538,987,152 $528,216,549 ($10,770,603) -2.04%
REVENUES
Total Revenues
Total Expenditures
EXPENDITURES
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Total General Fund Revenues FY2010 Proposed Budget
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$528,216,548
PROPERTY TAX$292,440,666
55.36%
OTHER REVENUE$1,100,204
0.21%
SERVICE CHARGES$23,524,849
4.45%
USE OF MONEY AND PROPERTY$4,792,100
0.91%
TRANSFERS$39,960,498
7.57%
OTHER AGENCIES$1,140,508
0.22%
FINES AND FORFEITURES
$13,168,383 2.49%
LICENSES AND PERMITS$44,145,419
8.36%
OTHER LOCAL TAXES
$9,077,500 1.72%
SALES TAX$98,866,421
18.72%
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Total General Fund Expenditures FY2010 Proposed Budget
$528,216,548FY2009 Adopted Budget = $ 538,987,152 (2.0% Decrease)
NEIGHBORHOOD SERVICES 81,116,879
15.36%
MANAGEMENT SERVICES 23,697,179
4.49%
INFRASTRUCTURE SERVICES 63,825,174
12.08%
NON DEPARTMENTAL
69,575,626 13.17%
PUBLIC SAFETY & ECONOMIC
DEVELOPMENT 290,001,690
54.90%
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Total Citywide Expenditures FY2010 Proposed Budget
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TOTAL EXPENDITURES: $1,048,824,998* FY2009 Adopted Budget = $1,034,021* (1.4% Increase)
Cable Communications $616,341 0.06%
Crime District $50,625,926 4.83%
Culture and Tourism $29,010,535 2.77%
Environmental Protection $4,305,117 0.41%
Awarded Assets $782,407 0.07%
Lake Worth $922,630 0.09%
Solid Waste $52,157,385 4.97%Water and Sewer
$341,494,432 32.56%
Municipal Parking $4,654,455 0.44%
Municipal Golf $5,726,246 0.55%
Municipal Airports $4,619,947 0.44%
Stormwater Utility $25,693,028 2.45%
General Fund $528,216,549 50.36%
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*Excludes internal service and insurance funds
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Total Citywide Revenues FY2010 Proposed Budget
General Fund $528,216,548 50.39%
Stormwater Utility $25,693,028 2.45%
Municipal Airports $4,619,947 0.44%
Municipal Golf $5,726,246 0.55%
Municipal Parking $4,654,455 0.44%Water and Sewer
$341,494,432 32.57%
Solid Waste $52,157,385 4.98%
Lake Worth $196,800 0.02%
Awarded Assets $843,146 0.08%
Environmental Protection $4,305,117 0.41%
Culture and Tourism $29,010,535 2.77%
Crime District $50,816,184 4.85%
Cable Communications $616,341 0.06%
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TOTAL REVENUES: $1,048,350,164**Excludes internal service and insurance funds
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Next Steps• August 11th City Manager recommends FY2010 Budget
• August 18th Budget Study Sessions / Public Hearing
• August 20th–21st Budget Retreat - Southwestern Baptist Seminary
• August 25th Budget Study Session / Public Hearing
• August 27th Budget Study Session
• September 1st Budget Study Session / Public Hearing
• September 3rd Budget Study Session
• September 8th Budget Study Session Public Hearing
• September 10th Budget Session
• September 15th City Council to adopt FY2010 Budget
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Questions?