HomeMy WebLinkAboutMinutes - Finance Committee - 05/22/2009 -C.‘Finance AdministrationI0FortCoLLins
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Council Finance Committee
Minutes
05 /22 /09
12:00 a.m.1:30 p.m.
Council Attendees:Mayor Doug Hutchinson,Mayor Pro-Tern Kelly Ohlson,
Councilmember Ben Manvel
City Staff Attendees:Darin Atteberry,Chuck Seest,Diane Jones,Mike
Freeman,Heather Shepherd,Jeff Scheick-PDT
Department
Others Pat Kahle,Milliman Actuary,and David May,Chamber
of Commerce
Approval of the Minutes from the April 20th meeting.
Kelly Ohison moved and Doug seconds minutes approved.
GERP Actuarial Update
Pat KahLe,Actuary from MilLiman,and Chuck Seest presented information on GERP
contributions.
V Historically,actuaL contributions have not kept pace with the annual amounts
determined by the actuary.
V In 2006,GERP was Less than 80%funded when Market VaLue of Assets compared to
Benefit Liability.
V Measured approach was agreed upon to provide suppLemental funding via a Phased
Approach:
$200,000 for years 2006-07
$400,000 for years 2008-09
$700,000 for years 2010 and beyond
Recommended next steps
>Stay the Course set by Council Finance Committee.Present a BFO Offer
requesting the additional $300,000 above the current funding level.
>History reflects GERP has experienced this pattern earlier in the decade
following 9-11-01 market sell-off.
Despite recent decline,assets are still adequate to fund benefits thru 2030.
•Better than both Medicare and Social Security.
•Better than most public plans’funded status.
KeLly suggested that even though the market has ‘fixed’problems like this over time
in the past,it would not be wise to assume that it will do so in the future.
Doug agreed and stated that while there is not a need to take action today,it will
need to be reviewed in near future as budgets are addressed by future Councils.
Kelly requested a summary brief (2 pages)on this topic with possible scenarios for the
entire City Council to review.
Darin stated that the City also has to be aware of honoring the commitment that was
made to contribute to the GERP.
Pat reviewed Milliman’s annual actuarial valuation.This presentation will,be
available on the City website at:http://www.fcgov com cltyclerk/retlrement.phD
Budget Update
Darin stated that the budget data being presented,and specifically any cuts,are not
finalized.Mike Freeman informed the Committee that the Original 2009 Budget
Revenue projection was $105,980,000.The updated projection is now $100,514,000,
which results in a Revenue shortfall of $5,466,000
Bulk of shortfall is from:
Drop in use tax by 26.7%year-to-date
Drop in sales tax collections of 3.6%year-to-date
Drop in Building Permits and investment earnings
Proposed measures to address this shortfall:
Vacancy savings/hiring freeze $2,000,000
Benefit savings $500,000
Reduce support to other funds $848,000
Reduce dept.GF spending $2,118,000
Total $5,466,000
In discussing staffing costs Darin wanted to clarify to the Committee that personnel
costs for the city are 58%and not the 80%as stated in a recent opinion column in the
Fort Collins Coloradoan.
Jeff Scheick reviewed some potential cuts with in the Planning Department.These
would not require formal Council approval,however Council will be apprised of the
final outcome.These cuts are being made in response to drop-off in dedicated
revenues due to a downturn in significant large scale construction projects within the
City.The related dedicated revenues are used to fund the operations of the
Development Review Center.
The meeting adjourned at 2:25PM.