CITY OF COTTONWOODCity CouncilFY 2009 Budget Overview

City Council Chambers

June 24 & 25, 2008 – 6:00 p.m.

Glossary of Acronyms

ADOT – Arizona Department of TransportationASRS – Arizona State Retirement SystemCAF – Capital Accumulation FundCATS – Cottonwood Area Transit SystemCDBG – Community Development Block GrantCIP – Capital Improvements Plan/ProgramCOLA – Cost Of Living AdjustmentDS – Debt ServiceE-MOD – Experience ModifierFAA – Federal Aviation AdministrationFmHA – Farmers Home Administration

FY – Fiscal YearGADA – Greater Arizona Development AuthorityGASB – Governmental Accounting Standards BoardGF - General FundGFOA – Government Finance Officers AssociationHURF – Highway User Revenue FundIT – Information TechnologyLP – Lease PurchaseM&O – Maintenance and OperationsMPC – Municipal Property CorporationPSPRS – Public Safety Personnel Retirement SystemWIFA – Water Infrastructure Finance AuthorityWWTP – Wastewater Treatment Plant

Building the Proposed BudgetGuidance

Governed by a multitude of State Statutes

Arizona League of Cities and Towns assistance – Municipal Budget & Finance Manual

Process (This is an evolving document)

Review Revenues & Projections

Review Expenditures & Estimates

Review the Reserve Levels

Prepare a Budget Calendar

Meetings! Meetings! Meetings!Staffs

Department Heads

Administration

City Council

Goal - Balanced budget

Budget Process - Calendar

Distribute Budget Worksheets & Instructions February 6, 2008

Distribute Goals & Performance Measures Forms & Instructions February 11, 2008

Distribute Personnel Request & Reclassification Forms February 11, 2008

Capital Improvements Meeting (Finance & City Manager) February 26, 2008

Budget Worksheets Due to Finance February 20, 2008

Distribute CIP Schedules, Forms, & Instructions February 22, 2008

Goals & Performance Measures due to Finance February 22, 2008

Potential Budget Issues Meeting - City Manager February 26, 2008

Goal Setting Meeting - City Manager February 29, 2008

Capital Improvement Forms due back to Finance March 05, 2008

Budget Process - Calendar

Council Annual Goal Setting Workshop March 12, 2008

Review of 1st. Budget Draft with Finance & Administration March 17-21, 2008

1st. Round Departmental Budget Meetings March 24-April 4, 2008

Revenue Update Workshop April 15, 2008

Capital Improvements Workshop- ½ Day (Staff) April 17, 2008

Review of 2nd Budget Draft - Finance & Administration April 21-25, 2008

Economic Issues Facing the 2009 Budget – Administration & Finance April 28, 2008

Dept’l Budget Meeting - Economic Issues: Dealing with a Deficit April 28-May 2, 2008

Strategic Bdgt Mtg – The Budget Deficit – Administration & Finance May 15, 2008

Budget Work Session – Declining Local Economy & Service Levels May 29, 2008

Budget Process - Calendar

Finance Budgetary Meeting – Working Through the Deficit May 29, 2008

Budget Work Sessions with City Council @ Council Chambers June 2008

Department Head Budgetary Update Meeting (Pre-Council Workshops) June 23, 2008

Introduction to the Budget / Personnel Matters / Capital Requests June 24, 2008

Departmental Presentations / Budgetary Wrap-up June 25, 2008

Reserved for additional Budget Meeting June 30, 2008

Budget Process – Calendar Remaining

Present Tentative FY 2009 Budget to City Council July 11, 2008

Public Hearings on Tentative Budget July 15, 2008

Adopt Tentative FY 2008-09 Budgets, set Expenditure Limitation July 15, 2008

Present Final FY 2009 Budget to City Council August 8, 2008

Public Hearing on Final Budget August 12, 2008

Adopt Final FY 2008-09 Budget August 12, 2008

Budget Due to GFOA for Award Review November 12, 2008

Budget Meetings

Council Review of the FY 2009 Proposed Budget

Personnel Issues

Capital Requests

Revenue Discussions

Overall Budget Overview

Review & Wrap-up

Council Meeting StructureAbout 2 hours long

Ask questions as they arise

Staff will keep notes of open issues (Open issues will be dealt with at the wrap-up session)

Structure of the Proposed BudgetCottonwood follows the Government Finance Officers Association (GFOA) Guidelines and serves as a:

Policy Document,A Financial Plan,An Operations Guide, andA Communication Device.

Budgeted vs. RevisedBudgeted amounts are planned revenues and expenditures when preparing the budget, including reservesRevised are more up to date estimates that are closer to what will actually happen through the close of the fiscal year – necessary to project a starting point for the new year’s budget

Reserves available to Council for allocationUndesignated reserves $266,745Council contingency $35,000

City Manager’s Transmittal Letter

Good place to Start Reading this documentIntroduces the budget document to its readers

Highlights important data about the document

Discusses Key Issues

Touches on Staffing and benefits

Reviews New Programs being introduced

Reviews the budget process

Finally, lays out the City’s Capital Expenditures for the following year

Budget Highlights

Total Budget is $86,941,470

4% Cost Of Living AdjustmentPlanned at mid-year, contingent on revenues meeting estimatesEstimated cost is $200,000

Merit Program is fully funded

Workman’s Comp e-mod is stable at 0.95x

Budgeted compensation studyContingent on revenues meeting estimatesPlanned for last fiscal quarterTo be implemented July 1, 2009

Budget Highlights

ASRS contributions declined slightly from 9.6% to 9.45%

Fire Department is going to a 24/48 work schedule

Health Insurance costs remained stable for FY 2009

Sales tax revenues were budgeted with an anticipated increase from 2.2% to 3.0%

Budget Challenges

PSPRS contributions increased:Police went from 17.30% to 22.07% - increase of 27.6%Fire went from 10.32% to 14.83% - increase of 43.7%

$689,310 in new staffing and reclassification requests

Sales tax, our main source of revenue is estimated to be down by 3%

An increase in the sales tax rate from 2.2% to 3.0% is budgeted

AZ Average fuel prices are up 37.4% over last year (regular gasoline)

Capital & Staffing needs to continue to increase dramatically

Compression and Structure issues still plague Public Safety

Major Items Budget Summary

New Staffing & Reclassifications $ 81,983

New Programs $ 68,800

Capital Outlay <$35,000 $212,580

Personnel Issues$81,983 Budgeted

Personnel Requests

Dept Job DescriptionExtended

CostsBenefits

Est.Annual Costs

NEW PERSONNEL

IT ManagerTech $56,025 $19,501 $75,526

Police Community Relations &Invest Assist $26,810 $17,441 $44,250Records Clerk/GIS $26,156 $14,155 $40,310Professional Standards Sergeant $46,155 $23,190 $69,345

Fire Fire Captain - Training/Safety $46,155 $16,987 $63,142Fire Captain - Admin/Grants $46,155 $16,987 $63,142PT Receptionist $10,000 $765 $10,765

Planning Housing Planner $41,814 $16,958 $58,772

CATS Transportation Driver (replace PT) $24,896 $13,929 $38,825

Library Library Security $26,156 $14,155 $40,310Library Security, part-time $12,000 $948 $12,948

Public Wks Streets Maintenance Worker $24,896 $13,929 $38,825

Utilities Project Manager $41,814 $16,958 $58,772

$429,029 $185,903 $614,933$0

Savings due to positions eliminated ($15,000) ($2,685) ($17,685)Net ($17,685)

$597,248

Personnel Reclassification RequestsDept Job Description

Current Range

Requested Range

% Increase incl 2% cola

Est Increase Benefits

Est.Annual Costs

Admin City Clerk 52 54 8.22% $1,110.83 $7,317Assistant City Manager to Natural Resources Director 56 56 2.00% $314.48 $2,071

Library Library Clerk to Library Specialist 17 26 27.39% $1,273.50 $8,388Library Director 52 54 5.00% $695.16 $4,579

HR HR Director 52 54 5.00% $668.98 $4,406

Fire Admin Coordin to Fire Admin Tech 24 25 4.55% $249.58 $1,644

Bldg Maint. Buildings & Maintenance Specialist to Buildings & Maintenance Specialist I 19 25 18.29% $872.64 $5,748

Parks Recreation Supervisor to Recreation Manager 32 37 5.58% $474.28 $3,124

Building Inspection

Building Inspector to Senior Building Insp/Plans Examiner 28 35 21.25% $1,513.76 $9,971

CATSDispatcher/Transportation Driver to Dispatcher/Trainer 21 26 13.14% $780.67 $5,142Transportation Manager to Transportation Director 40 54 41.30% $4,051.69 $26,687

Municipal Court

Court Clerk21 24 9.85% $470.30 $3,098

Court Clerk 21 24 10.33% $570.26 $3,756Court Clerk 21 24 9.84% $452.05 $2,977Court Clerk 21 24 9.84% $479.02 $3,155

$92,062

Personnel/Reclassification Requests Funded

Dept Job DescriptionExtended

CostsBenefits

Est.Annual Costs

NEW PERSONNEL

CATS Transportation Driver (replace PT) $24,896 $13,929 $38,825

Utilities Project Manager $41,814 $16,958 $58,772$66,710 $30,887 $97,597

Dept Job DescriptionCurrent Range

Requested Range

% Increase incl 2% cola

Est Increase Benefits

Est.Annual Costs

Assistant City Manager to Natural Resources Director 56 56 2.00% $314.48 $2,071

FY 2009 New Programs$68,800 Budgeted

FY 2009 New Programs Request / Budgeted

Department Requests BudgetedAdministration / City Council

Sustainable Arizona $5,000Growth Study and Analysis $150,000

Verde River Basin Partnership $10,900Prescott Air Service Subsidy $10,000

Natural Resource Department $0 $0Computers for City Council $10,000

Senior Center $15,000Senior Commission $2,000

Lobbyist ?Cottonwood ABC ?

Veteran's Van ?"Shop in Cottonwood" Campaign ?

Share Youth Commission Funding with Seniors

?

Elevate Economic Development to Department Level

$13,800 $13,800

NEW PROGRAM REQUESTS

FY 2009 New Programs Request / Budgeted

Department Requests BudgetedHuman Resources

Compensation Study $30,000 $30,000

Community DevelopmentHousing Program Coordinator $64,500

Police DepartmentNational Night Out $5,000 $3,000

Economic DevelopmentMarketing Video $5,000 $5,000

NEW PROGRAM REQUESTS

FY 2009 New Programs Request / Budgeted

Department Requests BudgetedParks & Recreation

Equestrian Center Spray Irrigation & Pump System Installation $10,000 $10,000

Walkin on Main Street $9,500Riverfront Landscape Project $7,000 $7,000Little League Parking Lot Access Gate

Project $5,000Sizzlin Salsa Event $17,000

CATIncrease Temporary Driver hourly rate

from $10 to $11 per hour$2,100

NEW PROGRAM REQUESTS

FY 2009 Capital Outlay & Improvements

$34,770,125 Budgeted

FY 2009 Capital – General FundGeneral Fund

Department Equipment & Project Description Requested BudgetedAdmin Software 25,000 25,000Natural Resources Used Hybrid Vehicle 22,000 22,000

Subtotal 47,000 47,000

City Council Old Town Parking 125,000 125,000Subtotal 125,000 125,000

Community DevelopmentPlotter 8,000 8,000Desktop Computer 1,500 1,500Roof Light Bar 500 0Permit Software 20,000 15,000

Subtotal 30,000 24,500

Economic DevelopmentMarketing Display 5,000 2,500

Subtotal 5,000 2,500

Municipal Court Audio Recording System 1,730 1,730Subtotal 1,730 1,730

Engineering Computer 2,500 2,500Subtotal 2,500 2,500

FY 2009 Capital – General Fund

General FundDepartment Equipment & Project Description Requested Budgeted

Police Department Building Security Software 5,000 0Computer Replacement Program 26,500 0Document Feed Scanner 1,000 0Interview Room Recording Equipment 4,500 4,500Intranet Solutions 6,500 0Mobile Computing Router 2,200 2,200Old Town Security Cameras 55,000 0Police Motorcycle 40,000 40,000Spillman Pin Mapping Module 11,500 0Substation Security Camera 5,000 0Tasers and Peripherals 14,700 14,700

Subtotal 171,900 61,400

FY 2009 Capital – General Fund

General FundDepartment Equipment & Project Description Requested Budgeted

Fire Department Command Staff Vehicle Replacement 29,250 29,250Emergency Medical Svc. Equip 25,000 10,000Emergency Preemption System 90,000 90,000Fire Prevention Safety House 75,000 75,000Fire Suppression & Safety Equip 25,000 20,000Rescue/Extrication/Special Ops Equip 5,000 5,000Telescoping/Articulating Light Tower for Support Vehicle 20,000 0Thermal Imaging Camera 12,000 12,000Physical Fitness Equipment 3,000 1,500Communications Infrastructure and MCT's 25,000 15,000Office/Station Equipment and Furnishings 5,000 2,500Computer Replacement/Upgrade Program 3,000 3,000Computer Software Upgrade/Purchase Program 2,000 2,000

Subtotal 319,250 265,250

FY 2009 Capital – General Fund

General FundDepartment Equipment & Project Description Requested Budgeted

Parks And Rec Used 1/2 Ton Pickup Truck 14,000 0Hand-held Radios 3,000 3,000Planning and Zoning Building - New Awning 5,000 0City Hall Renovations 8,000 0Equestrian Center Spray Irrigation & Pump Sys Install 10,000 10,000Riverfront Park Improvements 7,000 7,000Herridge Park Relocation 5,950 5,950Viejo Park 30,000 30,000

Subtotal 82,950 55,950

Building Maintenance Computer Equipment 1,800 1,800Subtotal 1,800 1,800

Total General Fund Capital Outlay $787,130 $587,630

FY 2009 Capital - HURFSpecial Revenue Funds

Department Equipment & Project Description Requested BudgetedStreets-Construction Pavement Preservation 350,000 350,000

W. Mingus St. Reconstruction 700,000 700,00012th Street Project - NACOG 95,000 95,000Sidewalk Additions 80,000 80,000Paula Street Reconstruction 345,000 345,000Willard St. Extension 910,000 910,000

Subtotal 2,480,000 2,480,000

Streets - Operations Dump Trucks 57,000 57,000Subtotal 57,000 57,000

C.A.T.S. 14-Passenger Buses 240,000 240,0007-Passenger Bus 45,000 45,000Shade Structure 183,750 183,750Fuel Tank Construction 47,540 47,550Wash Pads 37,000 39,500Electric 9,000 9,000Water/Sewer 16,000 16,000Storage Shed 2,500 0Wash Equipment 6,500 6,500Paving and Grading 75,000 75,000Computer Upgrade 5,000 5,000Bus Shelters 30,000 30,000Bus Stop Signs 2,400 2,400

Subtotal 699,690 699,700

FY 2009 Capital – Enterprise FundsEnterprise Funds

Department Equipment & Project Description Requested BudgetedSewer Construction Wastewater Collection System Master Plan 110,000 110,000

Reclaimed Water Pumping System Upgrade 150,000 150,000HWY 260 Construction 1,900,000 1,900,000Bella Montana Water Reclamation Facility 5,600,000 5,600,000WWTP Headworks 300,000 300,000Lift Station SCADA Upgrades 90,000 90,000

Sub-total 8,150,000 8,150,000

Enterprise FundsDepartment Equipment & Project Description Requested Budgeted

Sewer O&M Replenish Sand Filter Media 20,000 20,000UV Disinfection Lamps and Hardware 38,000 38,000WWTP Centrifuge Overhaul 8,000 8,000Control Valves 35,000 35,000

Sub-total 101,000 101,000

Water Construction HWY 260 Water System Upgrades 1,500,000 1,500,000Construction Manager at Risk 1,025,000 1,025,000Water Storage 750,000 750,000Aid in Lieu of Construction 143,000 143,000Arsenic Mitigation 925,000 925,000

Sub-total 4,343,000 4,343,000

FY 2009 Capital - Grants

Grants FundDepartment Equipment & Project & Project Description Requested Budgeted

Airport Runway Lighting 360,000 360,000Land Acquisition/Environmental Study 300,000 300,000

Sub-total 660,000 660,000

Total Airport Fund Capital Outlay 660,000 660,000

CDBG 12th St. Reconstruction 460,000 460,000Sub-total 460,000 460,000

FY 2009 Capital – Capital Projects Fund

Capital Projects FundDepartment Equipment & Project Description Requested Budgeted

Capital Projects Library Expansion 784,420 784,420Land Acquisition - Cemetery 575,000 575,000Recreation Center 13,169,405 13,169,405Furnishings and Equipment 885,390 885,390Architectural 792,000 792,000Evidence Building Architectural 350,000 350,000Evidence Building Land Acquisition 675,580 675,580

Sub-total 17,231,795 17,231,795

Total Capital Projects Fund Capital Outlay 17,231,795 17,231,795

FY 2009 Capital – Capital Projects Fund

CapitalEquipment Project

Administration & Water Resources 47,000Council 125,000Community Dvlpmt & Economic Dvlpmt 27,000Municipal Court 1,730LegalPolice 61,400Fire 265,250Engineering 2,500Parks & Recreation / Pool / Weight room 3,000 52,950Building Maintenance 1,800Street Maintenance & Construction 2,480,000Street Operations 57,000CATS 296,500 403,200Airport 660,000Sewer Operations & Maintenance 101,000 8,150,000Water Construction & Design 4,343,000Water O&MWater AdministrationCommunity Development Block Grant 460,000Capital Projects Fund 17,231,795

Total Capital Equipment & Projects $864,180 $33,905,945

FY 2009 ProposedCapital Equipment

General Government9.3%

Public Safety37.8%

Culture & Recreation

0.3%

Transit34.3%

Streets6.6%

Health & Sanitation11.7%

Reserves Status

Restricted Fund Balance $1,899,670From 45 to 60 days coverageFY 08 - $1,656,720

Capital Accumulation Fund $1,000,000Council capped until economy improvesAny excess over $1M for O&M

Undesignated Reserves $322,410

0.2% Public Safety Capital Fund $266,745

1% Portion Sales Tax CIP Reserve $827,265

Sales TaxSales Tax revenue is estimated to decline by an additional 3% in FY 2009

Retail Sales is 10% below last year – ($5.1M FY 2008 to $5.7M in FY 2007)

Real Estate and Rental is up 10% - ($807K FY 2008 to $731K in FY 2007)

0.8% is estimated to bring in only $1.8M due to the implementation, collection and disbursement

Use of fiscal responsibilityAll capital purchases are minimal and will be scheduled

Minimal additional staffing and reclassifications

Already have changes in Financial Operations Guide policies:Wireless Communication Device Policy

Travel Policy

Less patrol cars driving and more use of the MDTs

COLA was delayed until 01/2009 and only if revenues meet estimates

Compensation Study delayed until last fiscal quarter of 2009

Compensation Study implementation is delayed until 1st quarter FY 2010

Will be back to the Council in November for Sales Tax update

Question and Answer Time

Department Scheduling

General Fund Administration Legal Personnel City Council Natural Resources Community Development

Planning & Zoning Building Inspection

Municipal Court Engineering

General Fund Finance Service

Finance IT Services Non-Departmental Debt Service Internal Services Fiduciary Fund

Police/Dispatch/Animal Ctrl Fire

Department Scheduling

General Fund Police Dispatch Animal Control Fire

Enterprise Funds Water Utility Wastewater Utility

Special Revenues Library HURF CAT Grants Airport CIP Fund