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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 07/25/2006 - 2007 GENERAL FUND BUDGET DATE: July 25, 2oos WORK SESSION ITEM STAFF: Darin Atteberry FORT COLLINS CITY COUNCIL Diane Jones SUBJECT FOR DISCUSSION 2007 General Fund Budget. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED 1. How does Council prefer to deal with the projected 2007 Budget shortfall--- All expenditure reductions? • All revenue enhancements? • Combination of both? 2. If Council is considering new revenue as part of the approach to balance the budget, which of the option(s) of new revenues does Council prefer? 3. Considering the types and levels of potential service reductions that will have to be made to close the funding gap and balance the budget, what direction can Council provide relative to: a. Which services should be retained at current and/or enhanced levels? b. Which services would be considered for reductions? C. Other ideas for cuts/reductions? EXECUTIVE SUMMARY The purpose of this work session will be to review the City's projected General Fund revenue shortfall and to seek direction from City Council on preferred approaches to close the funding gap. This work session is part of a series of work sessions planned throughout 2006 that will prepare for Council's adoption of the 2007 Appropriations Ordinance in November. As of May, the General Fund shortfall was projected to be as high as $6.8 million. Updated revenue projections indicate that the shortfall is currently projected to be $5.8 million. The City Council is being asked to consider several options for closing this funding gap including service and expenditure reductions, as well as new revenue sources that Council could adopt prior to the 2007 Budget year. Other factors that must be reviewed in balancing the 2007 General Fund budget include: • City staff and an economic forecasting consultant (EPS) is currently reviewing revenue projections and will present recommendations regarding revised projections and changes to City forecasting methodology. Preliminary revenue forecasts indicate that revenues are likely to improve the previously projected "worst case" budget gap of$6.8 million in the General Fund. The forecasting consultant projects July 25, 2006 Page 2 that the revenue shortfall will be closer to $5.8 million--$] million less than previously projected. • The City Manager is suggesting two additional sources of cost reductions which begin to address the shortfall: reduce a portion of employee compensation adjustments and increase organizational efficiencies. Together these two strategies may yield $1,250,000 to $2,000,000 in cost savings for the General Fund. • New revenue source proposals have been considered by Council and additional details regarding these options are included in Section 3 of the Work Session binder. 2007 General Fund Shortfall Anticipated Funding Gap (TMF Assumption) $ (2,300,000) Revised Revenue Shortfall (May, 2006) (4 50n nnm "Worst Case" Revenue Shortfall (5/9/06) $ (6,800,000) Revenue Forecast Adjustment (7-19-06) $ 1 nnn nnn Net Revised Revenue Shortfall $ (5,800,000) City Manager Recommendations: Low Option High Option Reduce a portion of Employee Compensation Adjustments $ 1,000,000 $ 1,000,000 Organizational Efficiencies LOW nnn ..250.000 Net Shortfall $ (3,800,000) $ (4,550,000) New Revenue Alternatives for Consideration: Low Option High Option Park Maintenance Fee $ 2,600,000 $ 4,300,000 Electric Utility Payment in Lieu of Taxes increase $ 700,000 $ 700,000 Transportation Maintenance Fee* $ 2,360,000 $ 3,838,949 * High Option TMF includes replacing all General Fund costs for Street Maintenance and Median Maintenance July 25, 2006 Page 3 BACKGROUND On February 14, 2006 Council and staff met in work session to review alternatives for addressing the recognized funding gap of$2.3 million in the 2007 General Fund budget. City Council adopted the 2006-07 Budget based on the assumption that Council would implement a Transportation Maintenance Fee (TMF) to close the gap, or consider other alternatives early in 2006. At the May 9 work session,staff provided an update on the City sales tax revenue forecast for 2007. Based on that early forecast, staff estimated that the General Fund revenue shortfall could be as much as $6.8 million(including TMF). Council asked staff to evaluate several methods of closing the 2007 General Fund gap—and to primarily focus on reducing expenditures versus relying on new revenues while also addressing questions about three new revenue alternatives that may be considered by Council. The new revenue alternatives that Council focused on were a Park Maintenance Fee(PMF), an increase to the Electric Utility's Payments-in-Lieu of Taxes (PILOT), and implementation of a Transportation Maintenance Fee (TMF). While staff provided an initial list of potential service and expenditure reductions that would have provided an option to the TMF ($2.3 Million), Council asked staff to expand the list of possible reductions beyond the current "worst case" scenario of a $6.8 million gap so Council would have a range of options to consider as we proceed through the 2007 Budget Exception process. General Fund in Review: 2003 - 2006 Before we address the implications of the General Fund alternatives, it may be useful to put this discussion in context with what has happened to the General Fund over the last four years. The General Fund fully supports most of our general government services such as: • Police Building and Zoning • Park maintenance Technology services, including • Facilities maintenance Geographic Information Systems and • Libraries support of financial and asset • Natural Resources, including air management systems quality, solid waste Affordable Housing • Neighborhood Services, including Support services such as finance, code enforcement budget, legal, records and general • Long-range planning administration of direct services • Development Review The General Fund also partially supports or subsidizes other services such as: • Poudre Fire Authority • Human Services Performing Arts • Transportation operations, including Cemeteries street sweeping, snow removal, and Pedestrian access pavement management Engineering • Transfort and Dial-a-Ride Museum • Recreation City Bridge Program July 25, 2006 Page 4 In 2003 and 2004 numerous expenditure reductions occurred in the General Fund: $2,550,000 was cut in 2003 and $3,339,002 in 2004. Also, a variety of compensation adjustments were suspended for most employees during 2003, 2004 and 2005 which amounted to $8.3 million in avoided costs. The cumulative reductions or costs avoided amount to approximately$14.2 million. With limited resources available for the 2006-07 budget process, service changes - efficiencies as well as reductions-were reflected in the BFO offers and a total of 106 City employee positions were cut (this included other funds along with the General Fund). Here is a sample of the services that were eliminated or reduced in the 2006-2007 biennial budget: a. Police staffing increases for 2006 and 2007 not included b. Neighborhood street sweeping was reduced C. Affordable housing production—lowered by$602,898 leaving$133,000 in ongoing funding d. Human Rights and Education Office- eliminated e. Library teen outreach program—reduced f. Park maintenance reduced g. Transportation Demand Management program reduced by approximately 50%; for 2007 restructure the use of the federal dollars (CMAQ) h. Eliminate Showcase Fort Collins and other Cable 14 programs i. Special event/toumament coordinator for recreation programs and City-sponsored events not funded j. New Neighborhood parking and traffic calming programs - elimiated k. Street tree replacement—reduced 50% 1. Library hours reduced four hours per week, per library M. GIS aerial photography update—not funded n. Youth Activity Center closes in 2007 and services will be transferred and consolidated at the new Northside Aztlan Center(YAC gym remains open) o. City Hall Information and Reception Desk eliminated P. Staff training, marketing, supplies were reduced and equipment replacement schedules were extended q. Reduced staff Police Planning and Research Unit r. Eliminated management positions in Transportation,Finance,Budget,Water,CLRS, Human Rights, Neighborhood Resources, CPES, and Information Technology REVENUE GROWTH STAGNATES AND COSTS/DEMANDS CONTINUE The City's Adopted General Fund budget for 2007 amounts to $99.7 million. The 2007 General Fund budget assumed the implementation of a Transportation Maintenance Fee (TMF) to address the projected funding gap of $2.3 million. Council considered the TMF a "placeholder" and wanted to examine other options during the 2007 Budget Exception process. When the revenue forecasts for sales taxes that support General Fund operations softened for 2007, the funding gap widened. Without new revenues or an improved revenue outlook, further General Fund reductions would have to be considered. To reduce the 2007 General Fund by at least$6.8 million represents nearly a 7%decrease. This will be another decrease in a series of reductions since 2003. The last four years have seen the total July 25, 2006 Page 5 General Fund budget grow by 6% from $91.5 million in 2003 to $97.5 million in 2006. This minimal increase of less than 2% per year illustrates declining resources available for providing General Fund services, despite increasing costs for sustaining the current services as well as greater demands from a growing community. While the 2006-07 General Fund increased over 2005,there is simply not enough money,given our current revenue stream, to continue providing services to which Fort Collins' citizens are accustomed. Some of the services that remained in place were funded at lower levels. In a nutshell, the General Fund resources(or revenues)are not enough to sustain all of the services and the service levels the community previously enjoyed. The materials attached to this agenda item include an analysis of options for addressing the 2007 projected General Fund shortfall,a detailed description of potential service reductions,and a review of alternatives for new revenue sources. Over the past 4-5 years, the City has faced slowing revenue growth and ever-increasing cost to provide services to citizens. Based on updated revenue projections for the two quarters of fiscal year 2006, the 2007 General Fund expenditures need to be reduced by$5.8 million in order to balance the 2007 Budget. We can close this gap with the following approaches: • Cutting expenditures • Increasing revenues • Combination of cuts and added revenues POTENTIAL 2007 GENERAL FUND SERVICE REDUCTIONS Based on direction from the May 9 work session, staff has prepared a menu of service and expenditure reductions that total approximately$7.7 million. Some of these are related to improved operating efficiencies and proposed cutbacks in administrative costs. Approximately 10-15%of the proposed budget reductions represent administrative costs, deferred maintenance, deferred equipment replacement and other items that do not represent direct services to citizens. The remaining proposed reductions relate to services directly delivered to and used by citizens. The materials in Section 2 of the work session binder detail the potential reductions. The information is organized by each of the seven Key Outcomes: Safer Community; Improve Transportation; Environmental Health; Cultural, Recreation and Education; Economic Health; Neighborhood Quality; and High Performing Government. For each Key Outcome, there is: • A cover sheet that summarizes the City's total funded offers and the total amount of the potential reduction offers and graphics show the relationship of the potential cuts to the total adopted expenditures. The Drilling Platform as adopted in the 2007 budget. Offers which contain potential cuts are highlighted in yellow. The platform also includes a column that shows the total potential cut for each offer. July 25, 2006 Page 6 • The next section is a description of each suggested service or expenditure reduction. The descriptions are organized by outcome and the offer number. Reductions represent either entire offers or portions of larger offers. • The last section is a spreadsheet summary of all the potential reductions related to the Key Outcome including FTE reductions. REDUCTION OPTIONS The City Manager and staff has identified a number of expenditure reductions for Council's consideration. Potential reductions relate to three major types: a. Employee Compensation—Reduce expenses by$1.0 million The General Fund includes planned compensation adjustments that total$1,941,000 for Cost of Living increases (2.3%) for all employees and Merit or Skill Ladder adjustments (4%) for eligible employees supported by General Fund resources. (This does not include the Police Bargaining Unit compensation adjustments estimated to be $775,000. These adjustments are a contractual obligation with the Bargaining Unit). b. Oreanizational Efficiencies—Reduce expenses by$250,000 to $1.0 million Staff is scrutinizing a range of practices and services to reduce the cost of our local government services. Work is well underway to determine what can be changed, streamlined,or dropped to improve operations and/or reduce costs. Not all the work will be done by the time the 2007 appropriation ordinance is adopted by City Council (in accordance with the Charter, this must be done no later than November 30). Some examples are: o A recent change in the City's vehicle take home policy estimates an annual savings of$49,000. The General Fund will realize a small savings from this policy change as most of the impact is in other funds or subsidized funds. 0 Consolidating and reviewing outsourcing options for Information and Technology services to realize an estimated savings of$250,000. 0 Setting up a"One Stop Shop"for development review and building services. Cost savings are anticipated as we consolidate the activities and look for ways to eliminate redundancies. 0 Reviewing the structure of Transportation Services in relation to other key, related services such as Current Planning (development review), environmental programs and services and Utility operations to determine if changes could improve operations and reduce costs. 0 An independent analysis of the City's pavement management program to test our practices and standards and seek efficiencies and cost savings. July 25, 2006 Page 7 0 Outsourcing and/or partnering to reduce costs—Staff is prepared to test the"reverse auction"approach to see if costs can be reduced for some major purchases of commodities the City uses (e.g., tires). In 2005 the City spent $30.2 million on service contracts,equipment and commodities with private companies. Of this amount, the General Fund outsourced $1.3- 2.5 million in services and goods and we are looking for ways to do more to reduce costs. 0 An energy efficiency study related to the City's buildings to identify ways to reduce costs to heat and cool our facilities. Results are expected by the end of the year. C. Service cuts—reduce expenses by$7.7 million The list of potential expenditure reductions is detailed in Section 2 of the work session binder. The cuts represent a combination of eliminated services and scaled back services (i.e., customer service; reduced maintenance, upkeep, and frequency of replacements). The cuts also represent a mixture of support service reductions (administration) and direct services delivered to citizens. The proposed service and expenditure reductions represent 51 Full-time-equivalent (FTE) in current staffing. If these positions were eliminated, they would total $3.7 million in General Fund resources. HIGHLIGHTS OF THE POTENTIAL SERVICE CUTS The materials in Section 2 of the binder are very detailed regarding the potential cuts. While the reductions are numerous, the following are ones that are particularly noteworthy: a. Elimination of the Police Criminal Impact Unit which would affect the tracking of criminal activity. b. Reduction of the School Resource Officer Program(Police)by eliminating officers in the elementary and junior high schools—officers in the high schools would remain. C. Poudre Fire Authority would close Fire Station #10 and shift service to other stations. d. Poudre Fire Authority would reduce staffing on the South Ladder Truck e. Reduce Human Services grants f. Eliminate Police District 1 Substation g. Reduce resources ($30,000) for Economic Planning projects/policy studies h. Cut back on Library hours of operation i. Eliminate Intergovernmental Relations program j. Reductions in park, trail and median maintenance k. Reduce Dial-a-Ride service to ADA minimum requirements 1. Eliminate Police Traffic Unit M. Reduction of Support Services (staff reductions; maintenance and equipment deferral; training and development; etc) July 25, 2006 Page 8 Fort Collins has historically provided a wide array of services and delivered those with a high degree of quality and customer satisfaction. Since 2003, we have steadily scaled back both direct and administrative services. If the shortfall is to be addressed solely by cuts,without any added or new revenues, then the magnitude of closing the gap cannot be done with only administrative cuts. With respect to direct services,over the last few years many of the reductions reflected trying to do "the same with less." For example, in spite of reductions, the City has continued to maintain the parks and trails, trim and replace trees in our urban forest, minimize the disruption of noisy parties and unruly crowds in late night downtown, plow the snow-covered streets, work with citizens to craft policies and programs to deal with neighborhood and rental problems,provide recreational and special needs programs to youth and families. The list goes on. In an era of limited resources, the challenge is to determine which services are the right services to provide to the community—which ones do we continue; which ones do we enhance;which ones do we scale back, which ones do we drop. A related challenge is to maintain adequate levels of administrative service to support delivery of the direct services. 2007 GENERAL FUND—CURRENT REVENUE OUTLOOK At the May 9 work session,staff noted that,based on the sales tax revenue collections through April, sales tax projections for 2007 would have to be scaled back. That translated into a $6.8 million (worst case) shortfall for the 2007 General Fund. Based on the sales tax revenues collected through June 2006 (the first two quarters of the year), the revenue forecast for 2007 has improved. We are currently estimating that $ 5.8 million in General Fund expenditures will have to be cut from the adopted 2007 General Fund budget. Staff is currently working with a consultant, Economic and Planning Systems(EPS), to revise and update the City's methodology for projecting sales tax revenues and to provide a confident,updated estimate of 2006 and 2007 revenues(sales taxes as well as all other revenue sources for the General Fund). Attachment A includes a description of the revenue forecasting work being undertaken. New Revenue Alternatives—Previously Presented (May 9, 2006) Among the alternatives presented at the May 9 work Session (see Section 3 of the work session binder), Council narrowed the list to the following options that maybe considered if new revenues are to be pursued for 2007: 1. Park Maintenance Fee: A fee of $4.04/month on each residential unit in Fort Collins to pay for the cost of maintaining the City's Community Parks. This revenue source would provide approximately $2.6 million of new revenue to the General Fund, freeing up existing resources to be allocated to other General Fund needs. 2. Electric Utility Payments-in-Lieu-of-Taxes (PILOTS): A 1% increase to the PILOT paid from the Electric Utility to the General Fund. The increase would yield approximately$700,000 per year to the General Fund. July 25, 2006 Page 9 3. Transportation Maintenance Fee:A monthly fee on all commercial,industrial and residential properties within the City. The fee would pay a portion of the cost of maintaining the City's street system. This funding alternative would provide an additional$2.3 million to$3.8 million in General Fund revenues,freeing up existing resources to be allocated to other General Fund needs. At the May 9 Work Session, Council asked staff to develop several additional TMF alternatives. These options, outlined in Section 3, analyze the rate structures that would be necessary to recover the cost of median maintenance through a higher TMF fee and/or fully funding the Pavement Management Program through a TMF, eliminating the current General Fund subsidy. OUTREACH FOR 2007 BUDGET PROCESS The City plans to work to raise community awareness regarding the City's current financial condition. Staff will seek input from citizens in resolving the current issue and involvement the process. Objectives of the outreach process will include: • To help people better understand the City budget and how it works • To engage the community in solving the budget crisis o Gather input about citizen priorities for City services 0 Learn what services citizens may be willing to reduce o Learn whether or not citizens would support additional revenues To have informed consent about the outcome and support for the process Involvement Process Staff will use multiple tools and techniques, including: • Newspaper columns Website:fcgov.com/budget • Speaker's Bureau • Hands-on and online service prioritization activity • Cable 14 shows • City News articles • News releases &media outreach • Stakeholder meetings July 25, 2006 Page 10 The following schedule outlines the citizen involvement process: Communication Strategy Timeline City Manager"Budget Fact&Fiction" columns in The July 20 - August 3 Coloradoan City News Articles August, October Cable 14 City at a Glance Budget Q &A with Darin & August Mayor Hutchinson Fast facts; trivia information on Cable 14 bulletin August-November board "Close the Gap" activity(people will be presented with a "base"that includes services already in our budget, then remove services or add revenue to fill the identified budget gap) August - September Online version & hands-on activity Speaker's Bureau(service clubs, Boards & Commissions, August- September special events) www.fcgov.com/budeet Ongoing Media Relations: press releases & editorial board Ongoing meetings Stakeholder Meetings (i.e., Chamber; key community Ongoing leaders) Town Hall Meeting - televised on Cable 14 with call-in October ATTACHMENTS 1. Revenue Forecasting Description 2. Section 2 Proposed General Fund Reductions—by Key Outcomes 3. Section 3 New Revenue Alternatives—Park Maintenance Fee; PILOT increase; Transportation Maintenance Fee Attachment 1 FORECASTING SALES TAX REVENUES 2006 Sales and use tax revenue represents about 60%of total General Fund revenue. Since 1991,the City used a statistical model based on a regression analysis of the City's historical sales tax collections and Colorado Disposable Income. For many years,the model served us well as the variance between projected revenues and actual collections was approximately 1%. However, the existing approach relies on statewide income data and is not sensitive to changes in local retail spending and building activity which have the greatest impact on General Fund revenues. The 2006 and 2007 sales tax projections were based on the application of the statistical model. With the exception of a one-time sales tax payment,sales tax collections for 2006 have been below projections. Sales tax projections(and increases)for 2007 are estimated on the 2006 revenue base. Consequently,with 2006 sales tax collections below estimates, the 2007 sales tax projections must be adjusted downward. Because we rely on sales tax revenue to fund a significant share of our general government services, it is important to accurately forecast these revenues. With the underperformance of this year's collections, it is apparent that we need to rework and modify our methodology for forecasting sales tax revenues. City staff held a meeting with approximately 35 Finance and Budget managers from Front Range cities and counties. The purpose of the meeting was to gather information about the methods they employ for forecasting revenues and what has worked well and not so well in comparing forecasts to collections. Staff developed a preliminary strategy using multiple data points and is currently working with Economic and Planning Systems(EPS)to: (1)revise the 2006 and 2007 forecasts(all revenue types) for input to the Budget Exception Process; and(2)to develop a broader revenue forecasting model that will be a more accurate predictor of sales tax changes. A broader revenue forecasting model will take into account the following: Historical budgeted and actual revenues collected • Sales tax returns for major generators in the community Sales tax data for all retailers in 2005 and (to date) in 2006 • Other General Fund revenue sources • Changes in population, households, and housing unit growth • Employment and income trends • Conditions of the communities in the Fort Collins trade area Changes in regional retail in the trade area that includes Fort Collins, Loveland, Windsor, Wellington and unincorporated Larimer County. ATTACHMENT 2 • Potential Service and Expenditure Reductions 2007 General Fund Budget July 25, 2006 City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-1 Funded v. Reductions by Result Area (General Fund) High Performing Government Funded, $13,926,554 Economic Health Funded, High Pedonnirg Government $3,142,738 Reduction, $1,440.383 Economic Health Reduction, Transportation Reduction, $738,714 $1.115,087 Transportation Funded, $7,060,809 Enviro.Health Funded, $608,117 Envim.Health Reduction, $109,101 CRE Reduction, $1,294,933 rhoods Funded, $1,614,713 Neighborhoods Reduction, $203,393 CRE Funded, $12,324,928 • Safer Community Reduction,$2,776,357 Safer Community Funded, $39,223,635 • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-2 Economic Health 2007 Budget % Change of General Fund Total Funded Expenditures for Outcome $6,806,699 Total General Fund Expenditures for Outcome $3,881,452 General Fund Potential Reductions $ 738,714 -19% Total FTE Effect 6.05 FTE Economic Health Reduction Highlights: General Fund Offers and Reductions $3.881,452 Total,General Fund • Elimination of the Police District One Substation • A change in funding source Funded Offers,General is proposed for the Urban Fund, $3,142,738, Renewal Authority 81% • Downtown District Maintenance would be reduced by eliminating flower planting at various • downtown facilities • Reductions are proposed for Various aspects of the 4IF! City's Economic Vitality programs WGeral Fund Potential Reductions, $738,714, • Reduction in 19% resources for Council Policy projects and Economic Health studies Reductions v.All Funded Offers $6,806,699 Total,All Funds • Reduction in service resources in the Development Review Fwdwoffw,AllFundS P s6,067,985,s9°o Center Gems]Fmd Potential Reductions. $739,714, II°o City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-3 W W A Ol O) N m A W A 01 m 6 O A A W N W N W A O O CO O Oo (0 O Ui W N (n V W M M O O N W CJt N W W W V -+ V V A A W W V Cn CD W 0 A V O O) O z O Cm < oOCn pDTZTT (7TCm� oomvcomm (mf mm 0 m C N. -o g CD O 7 a. � 7 7 . O O O (=O < C O O O O th aD -V ° °: an0 D 0 3 � o m -° mv, 03. 3 3. 3 l7 o ano � = < � M mmm0N � > � CD m m C � o � � m o � wn� w � ° � mTo « < v D F � (n CD N D C) (D CD A � � N d d .. to a , n n °c m N v < (D m. 'a � m <, c CnCnCn3 = < (o < � m � o in. 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This will cut by 50% the Service Area's ability to engage independent contractors to assist with analysis and timely response to emerging Council policy issues. In the past, these funds have been used on projects such as the Impact Fee Analysis, Timnath Community Separators, Natural Area Buffer Standards, Regional Retail Analysis, Poudre River Contamination, and the City Plan Survey. Offer 287: Economic Vitality and Sustainability: Financial Tools $15,000 Reduction Description: This service reduction includes a reduction of$10,000 from the Landmark Rehab Loan Program, leaving $15,000 for 2007. The Design Assistance Program is also eliminated, resulting in a savings of$5,000. Offer 408: Development Review Center $66 173 P > Reduction Description: • Funding for City Council Policy Agenda work is reduced by $10,000 in each of three offers (#226, #394, and 4408) for a total reduction of$30,000. This will cut by 50% the Service Area's ability to engage independent contractors to assist with analysis and timely response to emerging Council policy issues. In the past, these funds have been used on projects such as the Impact Fee Analysis, Timnath Community Separators, Natural Area Buffer Standards, Regional Retail Analysis, Poudre River Contamination, and the City Plan Survey. This service reduction offer also reduces a Planning Technician position from 1.0 FTE to .5 FTE, an Environmental Planner Position from 1.0 FTE to .75 FTE and a reduction in funding for Outside Reproduction Costs by $12,000. Offer 409: Urban Renewal Authority $62,741 Reduction Description: This expenditure reduction changes the funding source for the Urban Renewal Authority from on-going General Fund to one-time Economic Health Vendor Fee Reserves. This funding source could continue to fund this offer in 2008 and 2009, and/or funding could come from Urban Renewal Authority Tax Increment provided sufficient funds are available. Offer 411: Downtown District Maintenance $ 53,500 Reduction Description: • This service reduction will eliminate annual flowers planted at any City facility in the downtown area that Parks maintains. This cut does not include Old Town City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-4 • Square which has a separate funding source for its flower program, medians and parkways along College Avenue or the flower garden in Civic Center Park. City facilities that will be affected include Library, Museum Courtyard, City Hall, Police Building, Avery House, Lincoln Center, Mulberry Pool, City Office Building, Transit Center, and flower beds on Block 31. Offer 428: Police - Patrol - District One Substation —Basic $495,595 Reduction Description: This service reduction would eliminate the District One Police Substation. Four sworn officer positions and one sergeant position would be eliminated. (The liquor officer would be maintained). Offer 490: Economic Program Leadership $20,705 Reduction Description: This service and expenditure reduction reduces support staff for the Economic program by eliminating a .25 FTE Executive Administrative Assistant and a .05 FTE Policy and Project Manager. Offer 537: Economic Marketing and Strategic Public Relations $15,000 Reduction Description This service reduction would eliminate the City's financial participation in the • Downtown holiday lights display. This program is currently a cooperative effort between the City, the Downtown Business Association and the Downtown Development Authority. Lack of City funding will reduce the scale of the holiday display which will in turn impact the ambiance of the downtown. The holiday light display is undertaken to attract people to Old Town for holiday shopping, dining and recreation. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-5 • • Economic Health 2007 Expenditure and Service Reductions 19.Jul-06 Offer # Offer Title Reduction/Impact Cuts 226 Economic Vitality & Reduce City Council Policy Reduce City Council Policy Agenda work by$10,000. (See offer 394 and 408 for total reduction of$30,000) Sustainability: Long Range Agenda work Will reduce ability to engage independent contractors to assist with analysis and timely response to Planning emerging Council policy issues. Examples of past projects are the Impact Fee Analysis, Natural Area Buffer Standards, Regional Retail Analysis, and City Plan Survey. (10,000) 287 Economic Vitality& Reduce Landmark Rehab Reduce Landmark Rehab Loan Program by$10K, leaving $15K. Eliminate the Design Assistance Program Sustainability: Financial Loan Program&Design of$51K. • Tools Assistance Program (15,000 408 Development Review Center Various Reductions FTE reduction of 0.75 (.5 Planning Technician and .25 Environmental Planner. Reduce outside reproduction costs by$12,000. Reduce City Council Policy Agenda work by$10,000. (See offer 394 and 226 for total reduction of$30,000) Will reduce ability to engage independent contractors to assist with analysis and timely response to emerging Council policy issues. Examples of past projects are the Impact Fee Analysis, Natural Area Buffer Standards, Regional Retail Analysis, and City Plan Survey. (66,173) 409 Urban Renewal Authority Fund with Restricted Changes the funding source from ongoing General Fund to one-time Economic Health Vendor Fee Revenues reserves. (62,741) 411 Downtown District Downtown Core Area Cut downtown core area horticulture program. Annual flowers will not be planted at any City facility in the Maintenance Horticulture downtown area including: Library, Museum Courtyard, City Hall, Police Building,Avery House, Lincoln Center, Mulberry Pool, City Office Building, Transit Center, and flower beds on Block 31. The effect of the cut will be a lack of color at downtown facilities during the summer months. Areas where flowers were planted will have a weedy appearance, making City facilities less attractive. (53,500) 428 Patrol District One Substation Eliminate District One FTE reduction of 5(4 Police Officers and 1 Sergeant). Will maintain the liquor officer. Eliminates the Substation District One substation and building rental expenses. Dramatic reduction in community oriented policing efforts. (495,595) 490 Economic Program Reduce .3 FTE FTE reduction of 0.3(0.25 Exec Admin Assist, and 0.05 Policy& Project Mgr). Leadership (20,705) 537 Economic Marketing& Reduce Holiday Lights City partners with the Downtown Business Association and the Downtown Development Authority to provide Strategic Public Relations holiday lights in downtown. Without City funding, the light display will be significantly scaled back, or the other entities will need to provide addtional monies. Reduction will impact the ambience of the downtown. (15,000) TOTAL ECONOMIC HEALTH (738,714) G:\BUDGET\Exception Process\2007 reductions&add-backs by outcome Environmental Health 2007 % Change of Budget General Fund Total Funded Expenditures for Outcome $68,552,326 Total General Fund Expenditures for Outcome $ 717,218 General Fund Potential Reductions $ 109,101 -15% Total FTE Effect .50 FTE Environmental Health Reduction Highlights: General Fund Offers and Reductions $717,218 Total, General Fund • The Waste Reduction & Recycling program would be reduced including staffing and program Funded Offers,General funding Fund, $608,117,85% • A reduction of$2,500 in "partner support" funds for • the Climate Wise program General Fund Potential Environmental Health Reductions, $109,101 , Reductions v. All Funded Offers 15% $68,552,326 Total, All Funds Funded Offers,All Funds, $68,443,225, 99.84% 11 • General Fund Potential Reductions, $109,101 , 0.16% City aaaaaaa.aaa .,aauuaay yrvan 0 bbIUaa, auay c,a, �.VVU i asc c-6 O N V O A A N N N 0 N W O (D W W W N W W A AI CD 0 (D W N V A OD V O W W O W W O A O N CO -4 A O Ou Z O (D (D V � N � O O O 0 O � 0 A CD O O 0 V do < D vmy(i m cK c m� �o c z ? D * cr: c c o3 cma cc: c-' zc c?' cZ cZ C? 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O O O A A 0 0 O O O O O N O 0 0 0 0 W O O O O O O A co V G) n (D N C m Ln f N (OD O 0 N co N CD N N W (n T O A aD O (D' C a • Environmental Health Service Package Items Reduction Items Offer 237: 100% Use of Clean Burning Bio-Diesel $30,842 Reduction Description: This expenditure reduction will account for anticipated lower Bio-Diesel costs in 2007. The need for the general fund subsidy will not be necessary for 2007. This g Y Y represents a $30,842 general fund cost reduction. Offer 272: Natural Resources Department Administration — Environmental Planning $5,282 Reduction Description: Ten percent of the Natural Resources Director's salary will be shifted from the General Fund to the Natural Areas dedicated fund. The ratio of General Fund to dedicated fund will be 25/75. This change will reflect the Director's 2007 time allocations based on proposed reductions to General Fund Natural Resource Department projects. Offer 286: Air Quality Improvement $2,366 Reduction Description: This expenditure reduction is a minor adjustment (less than $2,500) to move a portion of the Natural Resources Director salary to the Natural Areas program. • The change will result in no impact to services provided. Offer 31 l: Climate Wise $2,500 Reduction Description: This service reduction eliminates $2,500 in program funds for the Climate Wise program. These funds would have provided partner support. These funds are already limited and the program is growing. Any reduction in the budget will limit services available. Offer 370: Waste Reduction & Recycling $68,111 Reduction Description: This service reduction moves an Environmental Planner position to a .50 FTE and eliminates $30,000 in program funds. The program will no longer provide services to the Resource Recovery Farm project. Services provided to Climate Wise will be reduced or eliminated. The Christmas tree recycling program will be eliminated. Education and outreach will be substantially reduced. This program provides services to help the community attain a 50% solid waste diversion rate. It manages the Resource Recovery Farm business plan; the Pay—as-You-Throw ordinance; provides education/outreacb; and develops news programs and policies. • City of Fort Collins—Financial Stability Work Session, July 25,2006 Page 2-7 Environmental Health 2007 Expenditure and Service Reductions 194ul-06 Offer # Offer Title Reduction/impact Cuts 237 100% Use of Clean Burning Eliminate Bio-Diesel Subsidy Due to anticipated reductions in Bio-Diesel costs, there is no longer a need for the planned $30,842 subsidy Bio-Diesel from the General Fund in 2007. (30,842) 272 Natural Resources Increase Director Charged to Increase the Director's time charged to Natural Areas to 75%. This offer reduces the General Fund by 0.05 Administration - Natural Areas to 75% FTE. This change will reflect the Director's 2007 time allocations based on proposed reductions to General Environmental Planning Fund Natural Resource projects. See offer#286. (5,282) 286 Air Quality Improvement Increase Director Charged to Increase the Director's time charged to Natural Areas to 75%. This offer reduces the General Fund by Natural Areas to 75% 0.025 FTE. This change will reflect the Director's 2007 time allocations based on proposed reductions to • General Fund Natural Resource projects. See offer#272. (2,366) 311 Climate Wise Climate Wise Reduce Climate Wise funding by$2,500. This reduction will have a significant impact on funds available for Climate Wise partners(program customers). Since funds available for partner support are limited and the program is growing, any reduction in the budget will limit services available. 2,500) 370 Waste Reduction& Recycling Reduce .52 FTE and FTE reduction of 0.52(.5 Environmental Planner and .02 Director. Reduce program funds by$30,000. Will Programs eliminate services to the Resource Recovery Farm and Christmas tree recycling program. Will reduce education and outreach and services to Climate Wise. 68,111) TOTAL ENVIRONMENTAL HEALTH 1 (109,101) • G:\BUDGET\Exception Process\2007 reductions&add-backs by outcome Neighborhood Quality 2007 Budget % Change of General Fund Total Funded Expenditures for Outcome $2,285,924 Total General Fund Expenditures for Outcome $1,818,106 General Fund Potential Reductions $ 203,393 -11% Total FTE Effect 1.0 FTE Reduction Highlights: Neighborhoods General Fund Offers and Reductions • Reduce City $1,818,106 Total, General Fund contributions to Human Services Grants by 25% Funded Fund, $1 Offer6s,Gen3eral • A reduction in 89% administrative support to the One-Stop Shop in the Neighborhood Services department. 41General Fund Potential Neighborhoods Reductions, $203,393, 11^io Reductions v. All Funded Offers $2,285,924 Total, All Funds Funded Offers,All Funds, $2,082,531 , 91% 41 General Fund Potential Reductions, $203,393, • 9% City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-8 mcooV) w "N0' � CA) Ul wwNrn (WA mwww (�DN O0 RZ1 N N m 0) N N N to cD OV) ((00 CD A CO UV) A W O 2 0 C 0 :A m 0 0 a 0 m v = a U 0 0 0 m 0 0 0 ) Z O = W m o ° co 8 -B 0' 0' y o > j cc ° ( m c c0 3 3b3 Co" 0 o O n CL N_ w S a S C S S S ? S S S 7 0 M O a cr 000 7 and DOQ QtS7 > 330- d oQo gSo ago 0010 (occ03 2 'n a0 2Qmm oa. � � 0 Fr oo60o �, � � � 0 Er cn 0 0 0 0 0 � m DaO no Or- � °o m Z tnv5 � ' � mcnco � Sm T � 3 m a � z. � v Z tp o N to �-�. 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Those assets have traditionally been managed by the Larimer County Health and Human Services Division through coordination with the City. Offer 230: Innovative Neighborhood Code Enforcement $50,000 Reduction Description: This service reduction eliminates a portion of Code Compliance contractual funds used for abatements. To offset the proposed decrease in these funds, staff has made efficiency and effectiveness improvements to mitigate nuisances such as overgrown weeds, rubbish piles, or un-shoveled sidewalks with a new on-site violation posting process, as well as an increase in abatement fees that passes all associated costs on to the violator, resulting in significantly reduced numbers of City-contracted abatements performed. Staff anticipates the overall impact on City nuisance code services by this cut will be minimal, barring unforeseen • circumstances such as an extremely high number of snowstorms, etc. Offer 361: Customer Services—One-Stop Shop $69 643 Reduction Description: These service reductions will be accomplished by eliminating one Administrative Assistant position and reclassifying another Administrative Assistant position to a lower classification. The direct support provided to Neighborhood Services and Code Compliance staff will be reduced by approximately 20 hours per week. Support for the Zoning Board of Appeals will be eliminated from this offer and be assigned to other staff within CPES. Financial activities such as accounts receivable/accounts payable, vendor invoice processing, travel requests and other similar activities will experience delays as these duties will have to be absorbed by other administrative employees and prioritized in with other current duties and responsibilities. A further significant impact on this offer is the potential for a dramatic influx of complaint intake and processing associated with the new occupancy limit regulations when these become effective beginning in 2007; along with entirely new property and building maintenance regulations, now under development for discussion at the Sept. 12, 2006 Council Work Session. The reclassification of an Administrative Assistant position to a CSR 11 is not expected to result in any service reductions. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-9 • • • Neighborhood Quality 2007 Expenditure and Service Reductions 19Jul-06 Offer # Offer Title ReductiontImpact Cuts 91 Housing&Community Reduce Human Services Reduces the Human Services Program by about 25%. Funds are allocated to agencies serving households Develo ment Pr ram 25% below 80%AMI. (83,750) 230 Innovative Neighborhood Reduce Code Compliance Reduce Code Compliance funds used for abatements. Staff anticipates impact on City Nuisance code Code Enforcement funds services will be minimal, barring unforeseen circumstances such as high number of snow storms. (50,000 361 Customer Services--One Eliminate 1 Admin Assistant FTE reduction of 1.0 Admin Assistant($64,788). Reclass 1.0 FTE Admin.Assistant to Customer Service Stop Shop Rep. II ($4,855). There would be no service impact due to the reclassification. Elimination of the Admin. Assist.would result in a longer wait for customers at the counter and longer service response time, likely compounded with new regulations in early 2007. (69,643) TOTAL NEIGHBORHOOD QUALITY 203,393 G:\BUDGET\Exception Process\2007 reductions&add-backs by outcome Safer Community 2007 Budget % Change of General Fund Total Funded Expenditures for Outcome $143,600,942 Total General Fund Expenditures for Outcome $ 41,999,992 General Fund Potential Reductions $ 2,776,357 -7% Total FTE Effect 15.25 FTE Safer Community Reduction Highlights: General Fund Offers and Reductions $41,999,992 Total, General Fund • Poudre Fire Authority would close Fire Station #10 Funded Offers,General ($840,000) shifting service to Fund, $39,223,635, other stations. 93% • The Police Criminal Impact Unit would be eliminated which will affect the tracking of criminal activity. • The School Resource Officer Program would be reduced by eliminating 41 officers in elementary and junior high schools, while retaining officers in high General Fund Potential schools. Reductions, $2,776,357 ,7% • The Police Training Officer Safer Community position would be Reductions v. All Funded Offers eliminated $143,600,942 Total, All Funds • The Police Crime Funded Offers,All Prevention Officer Funds, $140,824,585, 98% would be eliminated • PFA would reduce staffing at its South Ladder Truck, reducing its staffing by 3 positions • Reduce the Restorative Justice Program General Fund Potential Reductions, $2,776,357 2% City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-10 -4 12 +mil V W A N v A V W N N ONi J W N fT W N W tW0 �Wp (Wl� N O O O J OD W CP m 0I O (00 J v N OWD N O V W OD A it D A O Of W A N tD V A IJ f0 (D O AA 0) c0 (0 O A T m D v � v v v m v m v O D T Z v cn v m N W 'D m C C m C C C 'U C C m C C C V () m C m M C m m Q � Q QQQQOQ o ¢� Qo 0Q � o c_ o o _. = o ... — o = = Qo = c c. 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O m O = N n � m O 0 0 0 0 0 0 o n o V J n N N c N (� N 000 m O = a • Safer Community Service Package Items—Reduction Items Offer 69: Police - Information Services Basic $86,538 Reduction Description: This service reduction would eliminate a Police Report Specialist and a portion of the Police Training Officer which are included in this offer. The Report Specialist will likely be eliminated from the District One substation. The balance of the Training Officer position is eliminated in Offers 332 and 438. Offer 321: Police Investigation - Criminal Impact Unit— CIU $509,409 Reduction Description: This service reduction would eliminate Police Services' Criminal Impact Unit (CIU). The CIU exists for the purpose of identifying patterns of serious criminal activity in the community and developing proactive, preventative strategies to reduce these risks and provide a flexible response to these crime patterns. The ClU investigates and tracks gang members, gang activity, and identifies patterns of serious criminal activity. The elimination of the(CIU)would eliminate these gang and career criminal response services and it would become increasingly difficult to identify patterns of serious criminal activity and to develop problem • solving strategies to reduce these risks and prevent criminal activity. It would also prevent the tracking and targeting of criminal activity by career criminals, and limit the department's ability to arrest wanted fugitives. Four Detectives and one Police Sergeant position will be eliminated through this service reduction. Offer 332: General Investigations Property/Major Crimes $130,591 Reduction Description: This expenditure reduction is tied to the elimination of offer 321 (Criminal Impact Unit) and the reduction of Offer 341 (School Resource Officer Program). All vehicle lease purchase expenses and operating/maintenance costs along with some other divisional associated costs were included in this offer when the original offers were written. This revised offer also includes the elimination of Investigations contribution to one training officer position. Each major service area will be reducing its original offer by their corresponding contribution percentage to reflect a total reduction of 1 FTE. Offer 341: Police Investigations - School Resource Officers $269,697 Reduction Description: This service reduction would reduce the scope of the School Resource Officer • program. Under this revised offer, School Resource Officers (SROs) would be removed from elementary and Junior High feeder schools but remain in place at City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-I 1 the four traditional Fort Collins high schools. This reduction would eliminate 6 SRO positions, leaving four SROs and one sergeant in the program. This reduction would also result in the loss of funding provided by Poudre School District (PSD)for a portion of this program. The revenue loss will equal $262,074. Offer 354: Police- Information Services Equip./Computer Replacement $3,600 Reduction Description: This expenditure reduction would reduce Equipment Replacement funds for Police Services by $3600. Offer 371: Police Investigations - Restorative Justice $18,284 Reduction Description: This service reduction would eliminate the .25 FTE Restorative Justice Coordinator position. Offer 394: Building Inspection $89,210 Reduction Description: Funding for City Council Policy Agenda work is reduced by $10,000 in each of three offers (226, 394, and 408) for a total reduction of$30,000. This will cut by 50% the Service Area's ability to engage independent contractors to assist with • analysis and timely response to emerging Council policy issues. In the past, these funds have been used on projects such as the Impact Fee Analysis, Timnath Community Separators, Natural Area Buffer Standards, Regional Retail Analysis, Poudre River Contamination, and the City Plan Survey. This expenditure reduction would also eliminate a Building Inspector position. It reduces on-site building code and contractor licensing enforcement by 40 hours per week. The approximate 30% decrease in plan review and building permit demand over the last two years and resulting corresponding decrease in building inspections and related field activity should allow additional inspection/investigation duties to be spread among the remaining Building Inspection and Code Compliance personnel, while maintaining acceptable service levels most of the time in terms of response time and adequate compliance- verification time on site provided building permit demand does not surge upward for any sustained period. Offer 438: Police -Patrol—Basic $280,640 Reduction Description: This service reduction will eliminate the Patrol Division's contribution to one training officer position and one(1.0 FTE) Crime Prevention Officer. Each major service area will be reducing its original offer by their corresponding contribution percentage to reflect a total reduction of 1.0 FTE. The elimination of the Crime Prevention Officer will directly impact the community, as the preventative services this position provides will be eliminated. Cityof Collins—Financial Stability WorkSession, u J l 25 2006 Page 2-12 YY g • Offer 566: Police 800 MHz Radio $58,241 Reduction Description: This expenditure reduction would extend the replacement schedule for 800 MHz Radios for Police Service. These funds will diminish the equipment replacement fund for the department, and require the lease purchase of future replacement radios with additional cost for interest. Offer 646: PFA Service $1,330,147 Reduction Description: The Poudre Fire Authority service reduction offers impact three areas of the department's services. Since 86.7% of PFA's operating budget consists of personnel, a cut of$1,330, 147 would heavily impact staffing and service levels. The service reduction packages that would have the least impact on emergency response and overall organizational support include: 1. Elimination of engine company 410 $840,000 2. Reduce south ladder truck from 4 to 3 $273,000 personnel per shift, reducing 3 positions 3. Reduce the Fire Prevention Bureau by one $97,387; position 4. Various line item reductions including $58,541 overtime conferences & training $47,988 • and tuition reimbursement $13,231 • City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-13 0 0 0 Safer Community 2007 Expenditure and Service Reductions 119.Jul.06 Offer # Offer Reduction/Impact Cuts 69 Information Services - Basic Eliminate 1 Police Report FTE reduction of 1.22(1-Police Report Specialist, and .22 Training Officer). This reduction also includes Specialist&partial Training the expenses related to these positions, such as training, overtime, meals, supplies, and equipment. Will Officer make staffing the District One substation with a Police Report Specialist virtually impossible.This will effect the quantity and quality of information provided by this department. (86,538) 321 Investigation -Criminal Impact Unit Eliminate Criminal Impact Eliminate the Criminal Impact Unit(CIU)of 4 Detectives and 1 Police Sergeant. Without the CIU, Police Unit Services would no longer be able to investigate, educate, and suppress gang related crimes or focus investigative efforts on apprehending and arresting fugitives. (509,409) General Investigations Reduce .24 Training Officer Reduce support costs for the Criminal Impact Unit and School Resource Officers that would be eliminated. Property/Major Crimes and support costs for offer These costs include equipment, tuition reimbursement, laundry, training, and supplies. FTE reduction of.24 #321 and#341 Training Officer. Will result in lack of coordination of all hiring processes within the agency, placing a heavier burden on HR. Will reduce the amount of training provided and increase the cost as training is provided by officers using overtime. The background investigation processes will become more expensive as overtime will be paid to officers and civilians to investigate applicants. Will cause a degradation or elimination of the current recruiting effort. (130,591 341 School Resource Officers Eliminate 6 School Resource FTE reduction of 6 School Resource Officers (SRO). Will reduce staffing of SRO unit to 1 sergeant and 4 Officers SRO's assigned to traditional high schools. Will significantly alter current contract agreement with Poudre School District. Reduces amount received from PSD b $262,074. (269,697) 354 Information Services - Reduce Equipment Reduces equipment replacement funds associated with eliminated FTE. (See offer#69) E ui menttCom uter Replacement Replacement (3,600) 371 Restorative Justice Eliminate .25 Restorative FTE reduction of 0.25 Restorative Justice Coordinator. Will dramatically limit number of referrals that could Justice Coordinator be accommodated. (18,284 394 Building Inspection Eliminate 1 Building Inspector FTE reduction of 1.0 Building Inspector and reduce City Council Policy Agenda work by$10,000. (See offer 394 and 226 for total reduction of$30,000) With reduction in plan review and building permit demand should be able to maintain acceptable service levels most of the time. (89,210) 438 Patrol -Basic Eliminate Crime Prevention FTE reduction of 1.54(1 Crime Prevention Officer& .54 Training Officer) Combined with reductions in Officer, .5 Training Officer offers#69&#332 the full training officer has been eliminated. Support costs are also reduced for vehicles, equipment, training,and supplies. The elimination of the Crime Prevention Officer will impact the community as the preventative talks and services provided by this position will be eliminated. (280,640) 566 Police 800 MHz Radio Reduce radio replacement Reduced savings for future radio and packset replacement. Currently replace in 7 to 10 years. Will reduce funds ability to pay for future replacement. A portion will need to be financed with the additional cost of interest. 58,241) 646 PFA Service Station 10 closure Eliminate engine company 10 (2067 Vermont Drive), eliminating nine positions. Station 10 has the fewest calls in the system (654 calls annually), and fewer second-in, backup responsibilities. Closing Station 10 will increase response time into it's area by approximately two minutes per call. (840,000) G:\BUDGET\Exception Process\2007 reductions&add-backs by outcome 0 Safer Community 2007 Expenditure and Service Reductions 19.1ul-06 Offer # Offer Reduction/Impact Cuts 646 PFA Service 25% staff reduction-South Reduce the south truck from four to three personnel per shift(25% reduction). The reduction would Truck decrease the speed and efficiency of the company. Truck operational procedures would have to be modified to accommodate the reduction in personnel resources. 273,000) 646 PFA Service Fire Prevention Bureau FTE Reduce Fire Prevention Bureau personnel by 1.0 FTE. Since all duties of Fire Prevention Bureau personnel reduction are legally mandated or necessary for basic customer service, responsibilities will need to be prioritized and .piece-meal"job duty performance with personnel from Admin., Operations, and the Bureau. (97,387) PFA Service Overtime, conferences, Reduce expenses for overtime($58,541), conferences and training ($47,988), and tuition reimbursement tuition reimb. reductions $13,231 . (119,760 TOTAL SAFER COMMUNITY 2,776,357) s G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome Cultural, Library and Educational 2007 % Change of Budget General Fund Total Funded Expenditures for Outcome $30,189,385 Total General Fund Expenditures for Outcome $13,619,861 General Fund Potential Reductions $ 1,294,933 -10% Total FTE Effected 10.75 FTE Cultural, Recreational and Educational Reduction Highlights: General Fund Offers and Reductions $13,619,861 Total General Fund • A $364,000 reduction in Library Services would result in an Funded Offers,General additional 16 hour reduction in Fund, $900324,928, library hours and the elimination of several programs. • Eliminate the Trips program at • the Senior Center and Senior discounts for recreation programs. • Substantial reductions in park maintenance including 41 Community and Neighborhood Parks and Trails General Fund Potential • Reduce upkeep and customer Reductions, $1,294,933 service at EPIC ,10 • Reduce City funding for Cultural, Recreational and Educational July 4`h celebration. Reductions v. All Funded Offers • Reduce Lincoln Center $30,189,385 Total, All Funds marketing and technical support. Funded Offers,All Funds, $28,894,452, 96% General Fund Potential Reductions, $1,294,933 City of Fort Collins—Financial Stability Work Session, July 25, 2006 Pag6 2-14 0) W M - " P. rQ N (� " " W W � AAA � (� � � n O m W O N A A N W A V V O O V V A V A V V m co m O co m O A O N 0 0 0 0 0 0 O O O W O O # O C 0) m W W O O W N A V V O V V m m W W A co (O 0 0 OD O O (O A CA m N m m CD m N A m m m 0 0 0 D O m N ro o z O D m m 2 D o Z Q X z v D ro c � o as (D W m W ZO aZ � Za (ow CZc Q) 00 pCz 0 CD C C) 0 � � � C � Z - 5' « rn -0 C C W O Z O C m O m C C 'O m m Z 0 2 j Z O O N Z A o o = 3 > >' 3 Cm x Cm Q Cm W D d M _. m 3 m F E' 3 m 0 m m .Z m 0 m c c y m - ([� o0i (ao 0 CD f0 S m (D @ G fD G CD G �. CD = G Oi (D @ -O � = m >• m c c m O. m < O O �? O a ' o m < m 3 < < �1 = m c3 < CL (_� w m < _U } o mCD ? 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N W O CL d c A p O a O � m m w N D .. 'o n 0 0 d A O � V A N W 0 m A6 N 0 0)- O N W _0 V V OD O w -n A V cn 0 w c O c0 000 N a ,i O c � cD d � A _ _ Om N N O 0) 0) 0 N w Vt O. Ci N O O a O 00000000 V C \ n N N c CD � N CD N N O to T 0) O a • Cultural, Recreation and Education Service Package Offers -- Reduction Items Offer 95: The YAC—Safe Place for Kids $ 15,000 Reduction Description: This reduction will reduce hourly clerical staff at the YAC. At the beginning of 2007, the hourly clerical position at 214 N. Howes will be transferred to the YAC to provide coverage. This will provide a seasoned staff member to help with the YAC closure and transition to the new Northside Aztlan facility. This will result in a probable closure of 214 North Howes as a central registration site. Because a primary registration site would be eliminated, this would result in increased lines at other Recreation registration sites, increased phone traffic and possible busy signals at Recreation facilities, and reduced customer service. Offer 101: Northside Aztlan Community Center $49,000 Reduction Description: This reduction will eliminate a portion of the funding for hourly clerical staff for the new Northside Aztlan facility. Clerical staff from the YAC and a classified clerical employee from 214 N. Howes will be transferred to the new recreation center to provide coverage. This will result in a probable closure of 214 North • Howes as a central registration site. Because a primary registration site would be eliminated, this would result in increased lines at other Recreation registration sites, increased phone traffic and possible busy signals at Recreation facilities, and reduced customer service. Offer 102: Recreation-At-Your-Door(RAD) Van Program $ 19,100 Reduction Description: This service reduction will reduce funding for hourly staff for this program. Staff will focus on soliciting donations, sponsors, and volunteers to continue the program at the same service level. Impact to participants should be minimal if staff is successful with fund-raising. Offer 106: EPIC: "Liquid and Frozen Assets" $ 63,000 Reduction Description: This expenditure reduction will decrease staffing at EPIC. Staff reductions will include a .75 FTE clerical position that is currently vacant (coverage will be provided with hourly clerical staff) and a 1.0 FTE facility maintenance technician (coverage will be provided with hourly facility attendants). Both of these positions are currently scheduled evenings/weekends for broader coverage by full-time classified staff during these times. The maintenance, cleanliness, general upkeep, and front desk customer service of EPIC will be compromised, potentially impacting customers' perception and rating of EPIC as a high quality City of Fort Collins facility. City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-15 • Offer 112: RAFT (Registration and Financial/Technology) $ 22,000 Reduction Description: This expenditure reduction and revenue increase will reduce expenses for technology upgrades and repairs for the Recreation Division, thus delaying PC and equipment replacement. Additional revenue from the Recreation Fund will be achieved because interest income in the Recreation Fund is ahead of projection. Offer 131: Essential Library Services $363 780 Reduction Description: This service reduction will reduce the library hours of operation by 8 hours at each facility for a total of 16 hours per week. Staff will eliminate the programs that fall outside the core services that public libraries must provide. This will include eliminating services that affect the fewest people including Bilingual Outreach Services programs to Spanish speaking families, Homebound Outreach for disabled patrons without transportation, elimination of the Homebound and Volunteer Coordinator(affects the use of 7.5 FTE volunteers in the library.) The IGA with FRCC calls for the library to be open at least 55 hours each week. With this reduction the Harmony Library will be open less than 55 hours. The IGA allows for this deviation only due to non-appropriation of funds. • Offer 159: Museum Program $ 27,006 Reduction Description: Several expenditure and service reductions will be made by the Museum. • Reduce Museum advertising budget by 50% • Reduce Museum programs and exhibits budget by 30% • Add an admissions charge for Museum visitors, thus reducing General Fund support of the facility. Offer 179: Senior/Adult Programs—"Ageless and Awesome" 77,900 Reduction Description: Three service and expenditure reductions are offered from the Senior Center programs: • Eliminate the 20% discount on activities for adults age 60 and older based only on age. This would result in increased revenue ($24k). • Eliminate the trips program for adults/seniors,including eliminating a 1.0 FTE classified Recreation Coordinator. This will eliminate trips for older citizens who like to travel but no longer drive or choose not to drive long distances, as well as short day trips offered through this program. 139 trips involving 2,535 participants were held in 2005 ($38.9k). • Cut miscellaneous expenses from this Offer, including supplies, food, and other commodities ($15k). This would "tighten the purse strings" on spending. City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-16 • Offer 199: Operating and Maintaining City Owned Memorial Parks $19,516 Reduction Description: The Cemetery Fund will reduce services in 2007 by reducing its seasonal workforce and delaying capital improvements. Maintenance will be deferred and trimming, mowing and weed control will be delayed. Capital improvements needed to increase revenue options will be delayed. i.e. an improved cremation garden venue. Savings from these cuts will be $19,516. Offer 328: Special Event Support $ 37,000 Reduction Description: This expenditure reduction will affect special events sponsored by the Parks department, such as the 41h of July celebration. 4th of July fireworks will be reduced by $37,000. Fundraising will be done in 2007 to help support the event and fund a portion of this reduction. If fundraising efforts are not successful, City Park preparation for the event will be significantly reduced. It will be a fireworks event only with no entertainment, no additional park preparation and next day cleanup only. This offer does not include Police, Fire or Transportation costs for this event. Offer 344: Urban Forest Management $ 65,028 Reduction Description: • This service reduction will eliminate one full time classified Forestry Technician position. The Forestry Division has 6 classified Forestry Technicians that are involved in maintaining 40,000 trees on city property. By cutting one Forestry Technician ($65,028) the pruning rotation for trees on city property will be extended from 9 to 11 years. Customer requests and complaints will increase due to reduced tree pruning, removal and planting. Hazard tree work will remain a priority but an increased risk of an accident will occur from falling trees or limbs. Tree replacement will be reduced from 50 percent of removed trees being replaced to only 40 percent. The condition of the cities urban forest will decline due to reduced maintenance. The cities ability to deal with the storm clean up of down trees and limbs will be reduced. Offer 345: Cultural, Library,Recreation Services Administration $ 33,252 Reduction Description: This offer will reduce contractual and commodity expenses in the CLRS Administration budget and reallocate personal services to other divisions. Park Planning will fund 15% of the CLRS Director's position through impact fees, and Golf will fund 1/4 of an Administrative Aide position previously paid for by the General Fund. Offer 369: Maintenance of City Owned Hard Surface Trails $125,000 Reduction Description: • This expenditure reduction will be made by using an additional $125,000 of Conservation Trust lottery money for trail maintenance. This will reduce the City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-17 • General Fund contribution to this service. There will be no impact on current service levels. Offer 414: Neighborhood Park Maintenance $ 65,000 Reduction Description: Several service reductions will be made in the maintenance of Neighborhood Parks: • Trimming along fence lines, buildings, trees, etc. will be eliminated. • Trash collection will be reduced from 6 days a week to 2 or 3 days a week depending on the park site. • Equipment replacement budget will be reduced by $25,000. Offer 415: Community Parks Maintenance $206,000 Reduction Description: Several service reductions will be made in the maintenance of Community Parks: • Trimming around fence lines, buildings, trees etc. will be eliminated in the park system. • Gateway Mountain Park will be taken over by Natural Areas or closed permanently. If Natural Areas is unable to take over the park, the City will be required to refund $100,000 to GOCO for funds that were used to create Gateway Park. • The City will no longer maintain the Picnic Rock area along Highway 14, unless Natural Areas staff can assume responsibility for maintenance. Picnic Rock is currently supported by one-time funding in 2007 of $18,500, Offer 433. If Natural Areas assumes responsibility for Gateway in 2007 any funding for Picnic Rock should also be given to Natural Areas. If Gateway is closed there will be no park maintenance personnel in the Poudre Canyon and it will not be economically feasible to keep Picnic Rock open. • Lifecycle maintenance in the community park system will be reduced by $20,000. This reduction will delay improvements and replacement of aging park infrastructure. • Equipment replacement will be reduced by $25,000. • Spring Canyon Community Park maintenance will be reduced by one Park Technician position. Funding for this position in 2007 was to be used for equipment purchases and start up costs and the position was to be hired in 2008. Equipment purchases will be delayed and Park Technician duties will be reorganized in order to meet the needs at Spring Canyon Community Park. Lights for basketball courts and tennis courts will not be turned on until on-going funding can be obtained in the future. Savings from this cut will be$55,000. Total savings from cuts to this offer in 2007 are $206,000 General Fund. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-18 • Offer 423: Gardens on Spring Creek/ Community Horticulture Program $5,000 Reduction Description: Expenditure reductions will be made for the operations of the Gardens on Spring Creek. Commodities and contractual budgets will be reduced by $5,000, from the previously proposed $60,300 to $55,300. We will accomplish this by cutting everything but the most essential needs, and applying more of our earned revenue to offset this cut. Offer 610: Lincoln Center Offer $ 102,351 Reduction Description: This service reduction eliminates General Fund revenues totaling$102,351. One Facility Assistant position (1.0 FTE) will be eliminated, saving $46,115 in General Fund expenditures. Lincoln Center advertising, marketing, meeting room and technical supplies and hourly personal services will be reduced by $35,640. The Lincoln Center will also increase revenue to replace a portion of General Fund support in the amount of$20,600. Performance Hall rents will increase by 7% and users will be billed for previously unbilled technical services. The result of these reductions will be to limit rental of conference rooms on Mondays, reduce promotional efforts by 35%, reduce maintenance and replacement of equipment and supplies, and place more of financial burden on Lincoln Center customers. This may result in out-pricing some customers. • • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-19 • Cultural, Recreation and Education 2007 Expenditure and Service Reductions 19-Jul-06 Offer # Offer Title Reduction/Impact Cuts 95 The YAC-Safe Place for Kids Youth Activity Center Reduced hourly clerical staff, funded by the General Fund, providing reception and registration support. Use hourly clerical support from Recreation Administration, not supported by the General Fund, to fill the void. This action will provide a seasoned staff member to help with the YAC closure and transition of processes and programming to the new NACC. Will result in probable closure of 214 N. Howes as central registration site. Result in increased lines at other registration sites, increased phone traffic, and reduced customer service. (15,000) 101 Northside Aztlan Community Northside Aztlan Community Reduce clerical staffing at the Northside Aztlan Community Center, funded by the General Fund, and replace • Center Center that staffing with existing clerical support from Recreation Administration, not funded by the General Fund. Will result in probable closure of 214 N. Howes as central registration site. Result in increased lines at other registration sites, increased phone traffic, and reduced customer service. (49,000) 102 Recreation-at-Your-Door Recreation-at-Your-Door Reduce General Fund supported hourly staff for this program. Staff will focus on soliciting donations, (RAD)Van Program (RAD)Van Program sponsors, and volunteers to continue the program at the same service level. Minimal impact to program participants if fund-raising is successful. (19,100) 106 EPIC:"Liquid and Frozen Reduce EPIC staff Reduce classified personnel by 1.75 FTE, (0.75 FTE clerical position, currently vacant, and 1.00 FTE facility Assets" maintenance technician). Both positions currently work evenings and weekends providing broader coverage by full-time classified staff. Hourly facility attendants will be used to provide coverage for the facility maint. tech. Maintenance, cleanliness, and front desk customer service will be lost with the use of hourly staff. (63,000) 112 RAFT(Registration and Reduce Recreation Reduce expenses for technology upgrades and repairs($22,000)for the Recreation Division. Interest income Financial Technology)"we Technology Upgrades in the Recreation Fund is ahead of projections which will allow them to cover$10,000 of the reduction, Keep Recreation Afloat" lesseninq the net reduction to Recreation to$12,000. 22,000) 131 Essential Library Services Reduce Library Hours & Reduce hours of operation at the Library by 8 hours at each facility(16 hrs./week). Elimination of"non-core" Services services. Eliminate services affecting the fewest people such as the Bilingual Outreach Services, Business • Librarian Services,and Homebound Outreach for disabled patrons. 90% of the total dollar reduction is in personal services-a reduction of 5.0 classified/unclassified FTE's. The IGA with FRCC calls for the library to be open at least 55 hours each week. The IGA allows for this deviation only due to non-appropriation of funds. Circulation and use will decline. Customer satisfaction will be significantly impacted. (363,780 159 Museum Reduce Museum Expenses Reductions of 50%and 30% respectively in the Museum's advertising and exhibits budgets. Advertising will be reduced $5,000 and exhibits expense reduced by$4,438. Programming will also be reduced by$4,438 (43%). In addition the Museum staff proposes reducing General Fund support of the Museum by$13,130. The reduced General Fund support will be made up by charging an admission charge to visitors at the Museum. Reducing exhibits, advertising and program may lead to reduced public participation by the public. Charging admission may discourage participation at the Museum, especially those who may be economically disadvantaged. 27,006) G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome • • Cultural, Recreation and Education 2007 Expenditure and Service Reductions 19-Jul-06 Offer # Offer Title Reduction/Impact Cuts 179 Senior/Adult Programs- Eliminate Senior/Adult Trips Eliminate the trips program for adults/seniors, including a 1.00 FTE classified Recreation Coordinator "Ageless and Awesome" ($38,900). This reduction will impact older citizens who like to travel but no longer drive or choose not to drive long distances and those who enjoy short day trips. In addition, the 20%discounts on activities for adults age 60 and over will eliminated ($24K). This fee increase may deter some from participating. Finally, miscellaneous adult proqramming expenses will be eliminated $15K . (77,900) 199 Operating and Maintaining Cemetery Miscellaneous Cemeteries will reduce its seasonal workforce and delaying certain improvements. Delayed maintenance will City Owned Memorial Parks Reductions result from this cut. Trimming, mowing and weed control will be delayed, as will capital improvements which • are used to increase revenue options(i.e. improved cremation garden venue). (19,516) 328 Special Event Support 4th of July $37,000 will be eliminated from the budget for the 4th of July celebration at City Park. Fundraising would be needed in 2007 to support the reduced portion of 4th of July programming. If fundraising is not successful, City Park preparation for the event will be significantly reduced. The event would be a fireworks only event with no entertainment, no additional park preparation, and next day cleanup only. This reduction does not include Police, Fire or Transportation costs for this event. (37,000) 344 Urban Forest Management Eliminate 1 Forestry Eliminate a Forestry Technician position (1.0 FTE)at a cost of$65,028. Pruning rotation for trees on City- Technician owned property will be extended from 9 yrs. to 11 yrs. Customer requests and complaints will increase and an increased risk of accident could occur from falling trees or limbs, tree replacement will be reduced from 50% of removed trees being replaced to 40%. The condition of the City's urban forest will decline and the City's ability to deal with the storm cleanup of down trees will be reduced. (65,028) 345 CLRS Administration Charge CLRS Staff to Other Reduce General Fund support equal to 0.278 FTE. 0.15 of the CLRS Director's position will be charged to the Funds City's Park Planning Division ($22,208), funded by Neighborhood Parkland fees. 0.128 of an Adminstrative Aide's position will be charged to the Golf Fund ($8,056). An additional $2,988 is reduced from non-personal services expenditures 33,252) • 369 Maintenance of City Owned Trail Maintenance Conservation Trust Fund lottery proceeds, totaling $125,000, will be used to fund trail maintenance in lieu of Hard Surface Trails using General Fund support. This adjustment will not impact the current level of services provided. 414 Neighborhood Parks Neighborhood Parks Trimming along fence lines, buildings, trees, etc. will be eliminated resulting in a less manicured look in the (125,000) Maintenance parks ($10,000). Trash collection will be reduced from 6 days a week to 3 days a week, depending on the park, this will result in more loose trash in the parks and increased complaints from citizens($30,000). Equipment replacement will be reduced by$25,000, delaying the replacement of wom out equipment and increasing repair costs to existing equipment. May increase the workload of Fleet Services and productivity will lessen due to increased down-time because of repairs. (65,000) G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome • 00 Cultural,Recreation and Education 2007 Expenditure and Service Reductions 19-Jul-06 Offer # Offer Title Reduction/impact Cuts 415 Community Parks Community Parks Trimming along fence lines, buildings, trees, etc. will be eliminated resulting in a less manicured look in the Maintenance parks ($10,000). Gateway Park to be taken over by Natural Areas or closed permanently. Closure of Gateway would affect rafting companies use as a launch site; the Water Utility would need to assume responsibility for protecting their infrastructure; and$100,000 in GOCO funds, used to construct the park, would need to be refunded to GOCO. Savings from the closure would be $96,000, however, one-time funds, totaling$100,000, would be needed to repay GOCO. Picnic Rock maintenace should no longer be a Parks Department responsibility if Gateway is closed ($18,500 one-time dollars in 2007). Life cycle in the community • park system will be reduced by$20,000 delaying improvements and replacement of aging equipment. Equipment replacement will be reduced by$25,000, delaying the replacement of worn out equipment and increasing repair costs to existing equipment. Spring Canyon Park maintenance will be reduced by one Park Technician position. Funding for this position in 2007 was to be used for equipment purchases and start up costs. Equipment purchases will be delayed and Park Tech. duties will be reorganized. Lights for basketball and tennis courts will not be turned on until ongoing funding can be obtained in the future. Savings associated with Spring Canyon reductions total $55,000.May increase the workload of Fleet Services and productivity will lessen due to increased down-time because of repairs. (206,000) 423 Gardens on Spring Creek Horticulture Center Reduction in non-fixed cost line items, totaling$5,000. Earned revenues will be used to offset the expenditure and Associated Community reductions. Horticulture Program (5,000 610 Lincoln Center Lincoln Center Eliminate a Facility Assistant position (1.0 FTE)at the Lincoln Center at a cost of$46,115. Reduce hourly personnel expense and non personal service expenditures including advertising, marketing, meeting room and technical supplies, a reduction of$35,640. Reductions will limit the rental of conference rooms on Mondays, reduce promotional efforts by 35%, reduce maint. and replacement of equipment and supplies, place more or a financial burden on Lincoln Center customers. In addition, the Lincoln Center will eliminate the General Fund support of 1.0 FTE by$20,596. Lincoln Center will pay for the reduction through an increase in Performance Hall rentals and user charges for technical services. 102,351) TOTAL CULTURAL, RECREATION AND EDUCATION 1 (1,294,933) G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome Improve Transportation 2007 Budget % Change of General Fund Total Funded Expenditures for Outcome $41,969,170 Total General Fund Expenditures for Outcome $ 8,175,896 General Fund Potential Reductions $ 1,115,087 -14% Total FTE Effect 10.08 FTE Reduction Highlights: Transportation General Fund Offers and Reductions • A proposed substantial $ 8,175,896 Total, General Fund reduction in service levels for the Dial-a-Ride Program to the ADA minimum requirements • A proposed reduction Funded Offers,Gener would eliminate the Fund, $7,060,809,8 . Police Traffic Unit • Reduce maintenance of street medians • Delays in constructing and installing traffic signs, signals and pedestr General Fund Potential ian Transportation Reductions14$11,115,087, crossin Reductions v. All Funded Offers gs• $ 41,969,170 Total, All Funds Funded Offers,All Funds, $40,854,08 97 General Fund Potential Reductions, $1,115,087 City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-20 (� 7q V A 0 A � W 0 A O 0N� 0O -40 A N WW N V � W jN V V A tj A (l1 m 41 O O V1 A A O 01 D) m W O A O W O Q)0) 0 A O) V (71 0 V O W 0 V 01 A O O (P V O tD o V A W � U) C 3 � 0 0 -0 -1 -pco0m -i � p D T co Op --1 ml7 � � � � 0C) -uV U (7 � (n � 2 0 m d ° m � o@30' � 0 £ a@ � °) o � °. 91j � (On 2.(C01 v°', ? � o m0003CD M nc �( n3 � n �p � 3 °ny o 0 0 2CD> 0 0m � oco � mmfDc= � v7 � � � —1 o a m � � � Of ° � � °• m m � O � i � o ° (DQ ° N0Oo Mm = D (o CD '0 < 7 a) m (D o p C) m a a. � c (�. 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Q O N 000000 (D O o 0 0 0 0 o W N O 0 0 0 0 0 0 0) O A O A 0 0 PO 0 OD O N O V O -4 O N C (D p� (� N 3 W O 0 a NN 01 (tDn ((°n O pO coW O 00 T 0 01 00 O -W+ (Wn N CO 7 OD M V 0 00 0 0 O � n • Transportation Services Service Package Offers -- Reduction Items Offer 217: Harmony Transfer Center $9,500 Reduction Description: This expenditure reduction would defer maintenance at the Harmony Transfer Center. The reduction will create minimal service impact. The aesthetic appearance of the facility may suffer; there may be pavement cracks or low spots in the asphalt where water collects. Over time, deferred pavement and concrete maintenance will accelerate the deterioration of the facility and be more costly to repair later. Offer 219: Regional Planning Organization Contributions $19,500 Reduction Description: This expenditure reduction eliminates the 20% contingency from the amount budgeted for the North Front Range Metropolitan Planning Organization (MPO) Fort Collins contribution. Fort Collins would not be able to meet its obligation if the MPO received unanticipated additional funding that would require any part of the 20% contingency. Offer 340: Maintenance of City Owned Medians $ 30,000 Reduction Description: • This service reduction will reduce the median maintenance contract from an 8 month contract to a 7 month contract. Median maintenance will therefore end one month earlier in the fall. Some plant loss may occur if there is a hot dry fall, weeds may develop in the fall before a hard freeze occurs, and grass may continue to grow after contract period has ended and will not be mowed until spring. Budget will be reduced by $30,000. Offer 434: Police- Patrol - Traffic Unit—Basic $363,310 Reduction Description: This reduction would eliminate the Police Traffic Unit, including three sworn officers and one sergeant. This will eliminate the team of officers and supervisor whose primary assignment is to enforce the city and state traffic code. Traffic ticket surcharge revenue will be lost as a result of this reduction. Offer 636: Core Street Maintenance $10,856 Reduction Description: This service reduction will cut administrative support for the Streets Maintenance department by .25 FTE. The reduction will result in reduced levels of customer service to citizens, other service areas and staff including contacts in person, by telephone or by e-mail. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-21 • Offer 644: Traffic Operations $81,921 Reduction Description: Three expenditure reductions are offered in the Traffic Operations Division budget. An efficiency improvement will be made by replacing Walk, Don't Walk indicators, from incandescent to LSD's. ($20,000 savings) An Equipment Operator 11 position will be eliminated, with other classified and hourly employees performing these duties ($20,000). Neither of these reductions will result in noticeable impact to citizens. The final reduction in Traffic Operations is a $42,000 reduction in the budget for traffic signal materials and equipment will result in fewer signal improvements throughout the community. Intersections that meet warrants and have no other funding sources will not be built in 2007 and staff will not be able to respond to citizen requests for pedestrian crossings and signal upgrades. Additional funding for this program has been included in the Building on Basics capital program beginning in 2008. This offer may have a significant impact on citizens. Offer 674: Transfort/Dial-A-Ride $600,000 Reduction Description: This service reduction would limit Dial-A-Ride para-transit services to the minimum level required under the Americans with Disabilities Act. The effect of these service reductions will include: • • Elimination ofparatransit service that is not within ''/< mile of a fixed route. Impacted destinations include Foothills Gateway and Poudre Valley Hospital's Harmony Campus. • Elimination of service hours beyond the fixed route hours of operations. • Elimination of reduced fares for low-income passengers. All passengers would be charged $2.50 per one-way fare. • Elimination of service to non-disabled passengers. • Elimination of service to disabled passengers who are able to utilize fixed route service. All active clients would undergo re-certification to verify capabilities. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-22 Improve Transportation 2007 Expenditure and Service Reductions 19-Jui-9s Offer # Offer Reduction/lmpact Cuts 217 Harmony Transfer Center Maintenance reductions Reduce maintenance expenditures by$9,500. Will create a minimal service impact, however, aesthetic appearance may suffer, pavement cracks or low spots may appear where water collects. Deferred maintenance could lead to more costly repairs later. (9,500) 219 Regional Planning Reduced MPO contribution Reduction eliminates the 20%contingency from the amount budgeted for the North Front Range Organization Contributions Metropolitan Planning Organization. Fort Collins would not be able to meet its obligation if the MPO received unanticipated additional funding that would require any part of the 20%contingency. Other impacts could include: funded projects not proceeding, return of funds to CDOT, and a delay year-end payment to 2008- (19,500)340 Maintenance of City Owned Reduce Median Maintenance Reduce medians maintenance contract from an 8 mo. contract to a 7 mo. Contract, resulting in a savings of Medians $30,000. Effect is that median maint.will end one month earlier in the fall. Some plant loss may occur, weeds may develo , and grass could row after final fall cutting until the spring. (30,000 434 Patrol Traffic Unit-Basic Eliminate Traffic Unit FTE reduction of 4(3 Police Officers and 1 Sergeant). Eliminates Traffic Unit whose primary assignment is to enforce the city an state traffic code. Will have a significant impact on offer#534 as the traffic ticket surcharge revenue will decline. 636 Core Street Maintenance Reduce Streets front desk Reduce contractual FTE Admin.Clerk I (363,310) ( )position by 0.25. Front desk hours will be reduced as will the coverage ability to provide customer service to citizens, other areas, and employees in person, by telephone, or by e- mail. Add'I workload will be distributed among two administrative staff members. (10,856 644 Traffic Operations FTE, electric, and traffic (1)Reduced Electric expenses will result from replacing Walk, Don't Walk indicators from incandescent to control equipment reductions LED's (svg. $20,000). No impact to the citizens of Fort Collins. (2)Eliminate a currently vacant 0.33 FTE (Traffic Equip. Operator II)(svg. $19,921). No noticeable impact to the public. Responsibilities will be distributed to the Signal Technicians and experienced hourly employees, and reprioritizing signal • maintenance priorities. (3) Reduce Traffic Control Equipment expense by$42,000. Intersections that meet warrants and have no other funding sources will not be built. Will impact Traffic Op's. ability to respond to citizen requests for pedestrian crossings and signal upgrades. 674 Transfort/Dial-A-Ride Dial-A-Ride reduction to FTA Reduce Dial-A-Ride(DAR)services to areas mandated by FTA and Americans with Disabilities Act (81,921 and ADA mandates mandates. Specific impacts include:elimination of paratransit service not within 3/4 mile of a fixed route (would eliminate service to Foothills Gateway and PVH's Harmony Campus); elimination of service hours beyond the fixed route hours of operation; elimination of reduced fares for low-income passengers(all passenger would be charged $2.50 per one-way fare); elimination of service to non-disabled passengers; elimination of service to disabled passengers who are able to utilize fixed route service (active clients would undergo re-certification to verify capabilities). This reduction will eliminate 5.5 FTE($270,891). 00,000) TOTAL IMPROVE TRANSPORTATION (6 (1,115,087) G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome 0 • Improve Transportation 2007 Expenditure and Service Reductions 19Jul-06 Offer # Offer Reduction/Impact Cuts NOTE: Transportation Services prepared an additional add-back requesting$500,000 needed to meet the projected Dial-A-Ride expenses based on an increasing demand for service. DAR has experienced steady annual growth for the past few years. As Fort Collins ages, and more retirees move into the community,and as outlying development grow,the demand for paratransit service is expected to increase substantially. • G:\BUDGE-RException Process12007 reductions &add-backs by outcome High Performing Government 2007 % Change of Budget General Fund Total Funded Expenditures for Outcome $59,887,352 Total General Fund Expenditures for Outcome $15,366,937 General Fund Potential Reductions $ 1,440,338 -9.57% Total FTE Effect 7.1 FTE Reduction Highlights: High Performing Government General Fund Offers and Reductions • Reduce funding and $15,366,937 Total, General Fund administrative support for Rebate Program Funded Offers,General • Eliminate publication of"City Fund, $13,926,554, News" (Utility Bill insert) 91% • Eliminate Intergovernmental Relations Program • Reduction in Municipal Court • expenditures • Reduction in custodial services to City buildings lot • Reduction in major maintenance and repairs to City buildings • Reduction In services High Performing Government General Fund Potential that support major Reductions v.All Funded Offers Reductions, $1,440,383 technical computer $59,887,352 Total,All Funds 9% systems Funded Offers,All Funds, $58,446,969, 98% 96 • General Fund Potential Reductions, $1,440,383 .2% City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-23 N 01 ((Cfinn (n A A A W N) � (T 9 ptlp, A A W N 0 0 A A M (n .06 j O) 01 O@ OM (T A W E LP A A W DN ° OD 0) ° NA A W N O CO CO A N N 0 N A 0) (3) (T W O ODON D) O W U WV N ((n N01 OA (T AA A(� V ( Ov 0 O N W Al (D U OA Q C j0 CD 0owAC C C—D M � xvm0 Ct0 (D mm0 n D m0 C CD mw (� vC a CD CD (� mDcD0) CD M. 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These reductions can be made without significantly impacting services to the community. Included are a reduction of the Deputy Court Clerk's FTEs from 3.5 to 3.0 and reduction of the Judge's FTE from 0.75 FTE to 0.70 FTE. This will eliminate a .5 FTE position that is currently vacant. Offer 84: Municipal Court Services Camera Radar/Red Light Cases $14,250 Reduction Description: This expenditure reduction in the Municipal Court's Camera Radar/Red Light program will reduce the Judge's position from 0.15 FTE to 0.05 FTE. The reduced FTE more accurately represents the amount of judicial time currently needed for this area. (*$14,250 is restricted revenue for camera radar uses only) Offer 85: Municipal Court Services Liquor Licensing Authority $7,125 Reduction Description: This expenditure reduction would change the Judge's FTE allocated to Liquor • Licensing Authority duties from 0.10 to 0.05 FTE. The reduced FTE more accurately represents the amount of judicial time currently needed for this area. Offer 181: City Clerk Administrative Clerk $ 50,189 Reduction Description: This service and expenditure reduction eliminates an Administrative Clerk I position ($47,694)in the City Clerk's Office. Elimination of this position, which serves as the front desk receptionist, will have a negative impact on customer service, including leaving the office front desk unattended and possibly leading to the elimination of the new passport application service. In addition the cost of April elections will increase due to the need to hire temporary employees to assist during the election and in increased overtime for existing employees. The service reduction will also eliminate the annual appreciation event for board and commission members ($2,495). Offer 193: Elections $7,125 Reduction Description: This offer reduces the funding for the November 2007 special election by $7,125. It is possible that this reduction is not practical to make, since the cost of elections is set by Larimer County and will be based upon their cost for running the coordinated election. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-24 • Offer 211: Custodial Services $78,290 Reduction Description: A number of service and expenditure reductions are offered by Operations Services in the area of custodial service in a variety of City facilities, with a total cost reduction of$78,290. • Eliminate Senior Center custodial services in the administration offices, mail room, office conference room, studio, wet crafts room, tech office and break room. Senior Center staff will need to clean these areas. • Reduce EPIC carpet vacuuming to every other day instead of daily. In addition, bleachers will be cleaned twice a week instead of daily. • Eliminate two days of custodial services, including trash removal, at Lee Martinez Farm (from 7 days to 5 days). • Reduce hallway carpet cleaning at 215 N Mason, 281 N College, and the cleaning of Library low traffic carpeted areas from twice a year to once a year. • Reduce exterior window cleaning at 35 general fund buildings to once a year instead of twice a year. • Eliminate half year of custodial services at YAC, and all custodial services at: 321 Maple, Downtown Restrooms, 110-114 Howes, Police Annex and 214 N Howes if these facilities are closed as denoted in Offer 214 (below). • Reduce office cleaning and trash removal in 26 general fund buildings • with offices to once every other week instead of weekly. • Elimination of on-going funding for a portion of a Buyer FTE ($4,313 salary &benefits). Purchasing will resume funding this position using one-time funding. Offer 214: Building Systems and Energy $274,310 Reduction Description: These service reductions in the Building Systems and Energy area will total $274,310. Reductions will include: • Elimination of the on-going funding for a portion of a buyer position. Purchasing will resume funding this portion using one-time funding. • Savings in utilities (Natural Gas, Water, Electricity) and maintenance/repair costs through the proposed closures of the following buildings: o Downtown Restrooms (in Remington St. Parking area) 0 321 Maple (2 staff will relocate to 215 N. Mason office bldg.) 0 110-114 N. Howes (Police staff will relocate temp. to 215 N. Mason, Friends of the Library will need to relocate.) 0 300 N Howes (Cramers) (Vacant) 0 304 N Howes (Vacant) 0 304 1/2 N Howes (Vacant) 0 214 N Howes (Recreation Administration). (Staff will relocate to • 215 N. Mason office bldg.) City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-25 • • Savings in utilities (Natural Gas, Water, Electricity) and maintenance/repair costs through the proposed par tial closures of the following buildings: • Partial closures (1/2 year) of: Youth Activity Center (YAC), and 228 LaPorte (Police Annex) • Leasing of 212 LaPorte (Abraxis) • Eliminate funding for maintenance and repair of Fire Stations 1-4 by Operations Services. A review of the inter-governmental agreement between the City and PFA indicates that PEA receives an annual allocation for the maintenance of the Fire Stations from the City. Thus PEA will need to fund future expenses. • Reduction of non-specific maintenance and repair funding($85,563) of facilities. The City's financial policy has a stated goal of providing an on- going funding level of 4% of the Current Replacement Value (CRV) of maintained general fund buildings. With this reduction, the funding for maintenance and repair of general fund buildings will be: 1.19% on-going and .95% one-time for a total of 2.1% CRV. Some unforeseen repairs may have to be deferred unless life-health-safety related. Offer 238 Accounts Payable processing $15,500 Reduction Description: • Delay in replacement of PC's, get rid of old check printer, remove privacy phones, may result in reduction in customer service. Offer 355: Payroll Processing $52,000 Reduction Description: This expenditure reduction is made possible through efficiency improvements such as saving on paper forms by converting to electronic timesheets, delaying the replacement of PCs for staff and discontinuing the maintenance contract for the payroll system. The reduction will not result in any significant impact to citizen services. Offer 359: Procurement Process $10,000 Reduction Description: This service reduction would include a reduction in advertising for the purchasing division, elimination of departmental maintenance contracts and reductions in phone usage. The cost of copier rental for the Purchasing Division will be transferred to Risk Management. This will result in delays in responses to vendors and departments. Offer 442: Sales & Use Tax $16,200 Reduction Description: This service reduction will include reducing travel by Sales Tax auditors by 42%. This will result in fewer out-of-town audits for auditors. Some revenue may be • lost if audits do not occur. The Sales and Use Tax division will also delay the replacement of some computers, extending the division's replacement schedule. City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-26 • Offer 445: Treasury Services $12 207 Reduction Description: Expenditure reductions in the Treasury Services Division will include discontinuing the City's lease of a monitor from Bloomberg for real time delivery of Financial Information System (no impact to service since existing equipment could be used) and reduction from a full 1.00 FTE to a .85 FTE for the Financial Analyst position. The result of the reduction will be a delay in processing cash flow projections on major capital projects such as the Police Bldg& Northside Aztlan Center. Offer 458: Cable/Media $10,000 Reduction Description: This expenditure reduction would delay Equipment Replacement for City Channel 14 and remote cameras in Council Chambers, DVD duplication equipment, studio sets, editing systems, etc. This cut would delay equipment replacement cycle with the risk of not meeting the 2009 deadline for conversion to digital format. Offer 460 Enterprise Resource Planning (ERP) Base Services $131,686 Reduction Description: These expenditure reductions will not directly affect services to citizens. The • following reductions were made: Reduce Equipment Replacement by $100,000; Reduce Other Commodities by $30,000; Reduce Other Contractual by $1,686. Because of changes in technology, existing equipment replacement funds are sufficient for the next hardware replacement. However, future equipment and/or application replacement will depend on requests for one-time funds, as no reserve will be available. The reduction in commodities will affect ability to purchase auxiliary computer equipment such as additional disk space, hardware for testing and prototyping, etc. Offer 470: Department of Transportation (DOT) Compliance Program $5,630 Reduction Description: This service reduction would be accomplished by transferring DOT responsibilities to Risk Management from the Human Resources Department. The position is a .1 I FTE. Responsibility for other DOT related activities currently fall under Risk Management. They interact with, support and provide direction to the person in this position, therefore this move will create a need for additional coordination between Risk Management and HR related to drug test results and will have some impact on HR administrative support staff. This position administers the contract employee process and provides back-up to HR secretaries. This work will have to be absorbed by current staff. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-27 • Offer 471: City Council Core Services $12,000 Reduction Description: This expenditure reduction reduces the amount of funds available in 2007 for City Council to travel for City business. The Council travel budget for 2007 would be reduced to $18,000. Offer 477 and 480: City Manager's Office- City Council Policy Development and Management; Organizational Leadership & Implementation $63,270 $49,153 Reduction Description: These service reductions in the City Manager's Office would result in the elimination of one Executive Administrative Assistant position in the City Manager's Office for .75 FTE (the balance of this position would be eliminated in Offer 490 as it provides support to the Economic Advisor.) An additional service reduction in the City Manager's Office would include the elimination of a .5 FTE Policy and Project Manager(with a small portion of the FTE included in the Economic Program Leadership Offer) This position provides policy development and implementation for special projects, such as the Southwest Annexation,Nuisance Ordinance, etc. Expenditure reductions in the City Manager's Office would be made in line items • for office supplies and equipment, for professional development of staff, and other unexpected expenses that occur during the year. Portions of the Intergovernmental Affairs program are included in this offer. This program would be eliminated in another service reduction offer. Offer 482: Basic Enterprise GIS Software & Support $35,000 Reduction Description: This expenditure reduction would diminish equipment replacement funding for Basic GIS systems by $30,000. With this reduction, the existing system will not be upgraded or replaced until after the normal replacement cycle, which will increase risk of equipment failure and reduce the ability to meet City department's increasing need for geographic based data. Data conversion funds were eliminated, further reducing the budget by $5,000. The total reduction for this offer is $35,000. Offer 483: Information Technology Application Development and Support $49,052 Reduction Description: This service reduction will eliminate a .5 FTE position which supports critical applications such as Ballot Tracking for Elections, Petitions, Liquor Licenses, and the City's check writing application. (Accounts payable, payroll, etc), database administration and support for fcgov.com web applications. By eliminating this .5 FTE, MIS' ability to assist City departments with application development in support of their business needs is severely hampered. This type of support is also City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-28 • needed to reach citizens through the City's website and get information back from the citizens by survey or other electronic form using a database application (such as "Ask the City Manager"). Reducing staffing in this area will limit the City's ability to develop similar new applications. Offer 484: Professional Enterprise GIS Hardware/Software & Support $10,000 Reduction Description: This expenditure reduction would diminish equipment replacement funding for Enterprise GIS systems by an additional $10,000. With this reduction, the existing system will not be upgraded or replaced until well after the normal replacement cycle, with the same impacts as stated above. Offer 509: Business Outcome Support/Budget Office $4,250 Reduction Description: This expenditure reduction reduces the Budget Office's funding available for office commodities and equipment. Offer 510: Rebate Programs $86 550 Reduction Description: This service reduction will include hiring fewer contractual staff to administer the City's Rebate Programs. This staff reduction will delay the processing of rebates. • A reduced and more accurate funding level for rebates (based upon the 2005 experience which provided funding to nearly twice as many households as a result of higher household income limits) will also be budgeted in 2007. Finally, advertising for the program will be cut in half($2,000). These changes will result in minor impacts to the overall program. Offer 529: City Attorney's Office—Legal Services $105,972 Reduction Description: The City Attorney's Office has offered three service and expenditure reductions. The first reduction would reduce non-personal services including conference and training and other minor line items. The second reduction would be to reduce the projected Assistant City Attorney salary adjustments. The adjustments were budgeted to realign these salaries more appropriately in the local market. The final reduction offer would be to eliminate a .5 FTE Assistant City Attorney. Offer 538: Bridging the Community & City through Communication $30,800 Reduction Description This service reduction would eliminate the publication of City News & reduce other contractual expenses within the Communications and Public Information Program. The contractual expenses will include eliminating funding for part-time hourly staff support. City News is used by nearly every city department to share information with residents. • City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-29 • Offer 539: Intergovernmental Relations $78,135 Reduction Description This service reduction would eliminate the Intergovernmental Relations program, including the Legislative Affairs Coordinator. In addition to managing the City's legislative lobbying efforts through the Legislative Review Committee, this individual also provides broad support services m the City Manger's Office. P PP Y g Additional services include providing internal communications including legislative updates, issue analysis, response to Council queries; External communications including City Manager's Update, City Manager's newspaper column, position papers, public speaking, and response to citizen queries. Offer 558: Network file and printer server operations $22 50 P P � Reduction Description: The Systems Group of the IT Department currently maintains and support several file servers that use Novel] NetWare, Microsoft Windows, Linux, HP-UX operating systems. This expenditure reduction reduces equipment replacement funding by $12,350 and reduces JDE System support by $10,000. The ERP budget will absorb the JDE System support reduction. Server replacement will depend on one-time funding requests rather than establishing an equipment reserve for the timely replacement of enterprise critical servers. • Offer 560: Accounting and Intern al/Extern a] Financial Reporting $10,400 Reduction Description: This reduction will eliminate the use of contractual assistance for the annual audit process, which will result in a delay in completion of CAFR. However, the CAFR will still be produced in compliance with the Charter deadline of May 31". Offer 582: High Performing Hiring -26,570 Offer 583: Performance Excellence 44,340 Offer 584: Human Relations Business Partners 88,670 Reduction Description: This service reduction eliminates and reduces staffing levels in the Human Resources Department. These positions were previously in three Human Resources offers, 582, 583, and 584. A 1.0 FTE Senior Human Resource Representative position would be reclassified to a lower level Staffing Representative position and the Assistant Human Resources Director position would be eliminated. The elimination of two key positions within the HR department will significantly impact the department's ability to transform the HR department to more fully meet the needs of the organization. The Assistant Director position cut will impact the ability to deliver service improvements; will reduce oversight for legal issues related to recruitment and selection; ADA compliance; and background and • drug testing. The department will also be less able to create business partner relationships with all City departments. City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 2-30 • Offer 626: Finance Administration and Financial Advisory Role $77,149 Reduction Description: These expenditure reductions include a delay in ordering office supplies for the Finance department and elimination of privacy phones in the department. These actions will result in minor impact. The department will also eliminate a vacant 1.0 FTE position which was included in the 2007 Budget due to prior year budget duplication. • • City of Fort Collins Financial Stability Work Session, July 25, 2006 Page 2-31 High Performance 2007 Expenditure and Service Reductions 194ui-06 Offer # Offer Title Reductionlim pact Cuts 47 Non-Camera Radar/Red Reduce .55 FTE FTE reduction of.55 (.5 Deputy Court Clerk and .05 Judge). If the case load does not increase there will be Light Cases no negative impact at this time. (29,600) 84 Camera Radar/Red Light Reduce .10 Judge FTE reduction of.10 Judge. No negative impact at this time. The reduced FTE more accurately represents Cases the amount of judicial time currently needed. This is funded by camera radar funds, $14,250 of the restricted revenue would be available forspecific camera radar uses. 0 • 85 Liquor Licensing Authority Reduce .05 Judge FTE reduction of.05 Judge. No negative impact at this time. The reduced FTE more accurately represents the amount of judicial time currently needed. 7,125) 181 City Clerk Administration Eliminate 1.0 Admin Clerk I FTE reduction of 1.0 -Admin Clerk I. Customers will need to ring bell for service, need to hire temporary staff during election, more overtime of existing staff during election. Passport application service may be discontinued. Eliminate annual appreciation event for board and commission members. (50,189) 193 Elections Reduce November special Reduce funding for November special elections. Allocation of the total cost is determined by formula. If the election funding cost is higher more funds would need to be found. (7,125) 211 Custodial Services Reduced Custodial Services Eliminate funding of$4,313 representing a portion of a Buyer(0.05 FTE)position funded by Op. Svcs. The portion will be picked up Purchasing, using one-time funds. Reduce"Custodial Services"by$78,290. Facilities impacted will include Senior Center, EPIC, Lee Martinez Farm, 215 Mason, 281 N. College, and the Library. In addition, exterior window cleaning will be reduced to once a year. Custodial svcs.at the YAC (112 yr), 321 Maple, Downtown Restrooms, 110-114 Howes, Police Annex and 214 Howes will be eliminated. Reduce office cleaning and trash removal in General Fund bldgs. to once every other week (except for City Hall or the offices of the Mayor, City Manager, and Council). (78,290 214 Building Systems and Energy Reduced Utilities and Repair Eliminate funding of$4,313 representing a portion of a Buyer(0.05 FTE)position funded by Op. Svcs. This Management and Maintenance of General portion will be picked up Purchasing, using one-time funds. Reduce utility (natural gas,water,and • Fund Facilities electricity) maintenance and repair costs through: 1)closing of the Downtown Restrooms, 321 Maple, 110- 114 N. Howes, 300 N. Howes (Cramers), 304 1/2 N. Howes and 214 N. Howes (Rec. Adm.); 2)partial closures (1/2 yr.)of the Youth Activity Ctr., and 228 LaPorte Ave(Police Annex); and 3)leasing of 212 LaPorte (Abraxis Glass). Additionally, Ops. Svcs. will no longer fund maintenance of Fire Stations 1-4 ($75,600). According to the IGA, the City contributes through an RAF, dollars for PFA to use for O&M. Finally, a reduction of non-specific maintenance and repair, totaling$85,563, will reduce funding in terms of the Current Replacement Value (CRV)of General Fund bldgs.for repair and maintenance. (274,310) 238 Accounts Payable Processing Delay PC replacement& Delay rplmt. of PC's, reduce exp. for maintenance contracts and telephone. May reduce the level of reduce other expenses customer service. (15,500) 355 Payroll Processing Delay PC replacement& Delay rplmt. of PC's, reduce maint. contract for payroll module, and records and forms (convert to electronic reduce other expenses timesheets. Minor impact to customer service. (52,000) G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome i • • High Performance 2007 Expenditure and Service Reductions 19Jul-06 Offer # Offer Title Reduction/impact Cuts 359 Procurement Process Reduce various expenses Reduce advertising, maintenance and phone usage, and move copier rental to Risk Management. Will result in some delay in response to vendors and departments. (10,000) 442 Sales & Use Tax Reduce travel audits,delay Reduce travel for sales tax audits by 42%, delay replmt of PC's. Reduced travel takes flexibility away from PC re lacement audit scheduling. Minor impact in delaying re Imt. of PC's. (16,200) 445 Treasury Services Reduce .15 Financial Analyst Reduce Financial Analyst FTE by 0.15, and drop Bloomberg System lease. No impact from dropping Bloomberg equipment lease. Delay in processing cash flows will result from the FTE reduction. (12,207) 458 Cable/Media Reduce Equipment Reduce Equipment Replacement which includes equipment for City Channel 14 and remote cameras in Replacement Council Chambers, DVD duplication equipment, studio sets, editing systems, etc. Will delay equipment replacement cycle with the risk of not meeting the 2009 deadline for conversion to digital format. 460 Enterprise Resource Reduce ERP Equipment Reduce equipment replacement($100K),other commodities($30K), and other contractual ($1,686). The (10,000) Planning (ERP) Base Replacement ERP program has adequate funds for upcoming hardware replacement in 2007. MIS is analyzing options Services for system upgrades and replacement and will make recommendations and funding requests in 2008/2009 if needed. (131,686) 470 Department of Transportation Reduce FTE .11 -transfer FTE reduction of 0.11($5,630)-transfer DOT responsibilities to Risk Mgmt. Other HR duties associated (DOT)Compliance Program DOT to Risk Mgmt with this FTE reduction will have to be absorbed by existing personnel resulting in reduced services and added delays. (5,630) 471 City Council Core Services Reduce conference and other Reduce conferences and other contractual expenses. Council conference funds were$28,000 and are now contractual $18,000. Will limit City Council networking,educational opportunities, and the ability of the City to lobby legislators on issues of concern to Fort Collins. (12,000) 477 CMO-City Council Policy Reduce .75 FTE and other FTE reduction of 0.75(0.25 Exec Admin Assist, 0.4 Policy& Project Mgr, and 0.1 Legislative Affairs Development&Management expenses Coordinator). Reduce other contractual expenses$5,000. Reduces CMO ability to fund unexpected • expenses during the year. 63,270) 480 CMO-Organizational Reduce .75 FTE and other FTE reduction of 0.7(0.5 Exec Admin Assist, 0.1 Policy&Project Mgr, and 0.1 Legislative Affairs Leadership & Implementation expenses Coordinator). Reduce other expenses $7,000. Reduces CMO ability to fund unexpected expenses during the ear. (49,153) 482 Basic Enterprise GIS Delay equipment Eliminate data conversion costs ($5K)and reduce equipment replacement($30K). The existing system will Software &Support not be upgraded or replaced until well after the normal replacement cycle. (35,000) 483 Application Development& Reduce .5 Systems Analyst Reduction of 0.5 FTE (Systems Analyst). This position provides database support, develops new products Support to assist departments, and generates Crystal reports. This position is vital to the continued function of the City. (49,052) 484 Professional Enterprise GIS Reduce GIS Equipment Equipment replacement by $1 OK. Impact, unable to upgrade the system after normal life cycle. Hardware/Software& Replacement Support (10,000) G:\BUDGET1Exception Process\2007 reductions &add-backs by outcome 0 High Performance 2007 Expenditure and Service Reductions 19Jul-06 Offer # Offer Title Reduction/impact Cuts 509 Business Outcome Reduce various expenses Reduce contractual expenses, primarily outside reproduction. Able to print about 75 budgets at similar Su ort/Bud et Office quality to 2006-2007 Budget. (4,250) 510 Rebate Programs Reduce contractual Reduce contractual assistance in processing rebates ($44.5K), advertising ($2K), and program dollars for assistance&program funds sales tax rebates ($40K). Reduction in contractual help will delay processing rebates. Minor impact expected from reducing the program amount for sales tax rebates. (86,550) 529 City Attorney's Office Reduce .50 FTE Assistant FTE reduction of.50 (Assist. City Attorney's). Will reduce the level of service and may result in Assist. City • City Attorney Attorney's leaving. Reduce City Attorneys'salary adjustments. Will leave attorneys at a wage well below average. Reduce conference, training and other expenses. Continuing legal education is mandated by the state bar, so credits will need to be earned in other ways. (105,972) 538 Bridging the Community& Eliminate City News& reduce Eliminate City News and reduce other contractual expenses for part-time hourly support. City News is used City through Communication other contractual by nearly every city department to share information with residents. Other contractual will effect the all of the members of the CPIO and reduce efficiency. 30,800) 539 Intergovernmental Relations Eliminate Intergovernmental FTE reduction of 0.8 Legislative Affairs Coordinator and all associated costs. This eliminates the Affairs program Inter overnmental Affairs program. (78,135) 558 Network File &Printer Server Eliminate File/Print Servers Eliminate file/print servers equipment replacement funding ($12,350)and reduce JDE support($10K). Will Operations Equipment Replacement require extending the life the existing systems which increases the risk of computer failure, and Funds subsequently reduces the Ci 's ability to perform day to day functions. (22,350) 560 Accounting and Reduce contractual Reduce contractual assistance, contractual labor($8,500)and telephone exp. ($1,900), during the year-end Internal/External Financial assistance&telephones audit. May cause delay in completion of the Comprehensive Annual Financial Report(CAFR). Reporting Services (10,400) 582 High Performing Hiring Trade higher paying positions FTE reduction of 0.50(0.25 Asst. HR Dir, and 0.25 Sr. HR Rep.). With reductions here and in offers 583 for lower paying position and 584,an HR Staffing Rep. position will be created. Impact: offloads some admin. tasks to a more appropriate clerical level; reduces the HR Business Partners (formerly Sr. HR Reps) interaction with departments on recruitments. 26,570 583 Performance Excellence Reduce .5 FTE FTE reduction of 0.50 (0.25 Asst. HR Dir, and 0.25 Sr. HR Rep.). Eliminating these positions will negatively impact HR's ability to implement of the pay for performance system, create add'I workload for the HR Dir., and reduce the resources HR Business Partners/Res available for projects. 44,340) 584 Human Relations Business Reduce 1.0 FTE FTE reduction of 1.0 (0.5 Asst. HR Dir, and 0.5 Sr. HR Rep.). Eliminating these positions will: create add1 Partners workload for the HR Dir.; negatively impact the ability of HR to focus on leading-edge, innovative HR strategies, and lessen the coverage by HR Business Partners. (88,670) 626 Finance Administration and Reduce 1 FTE&telephone Reduction of 1 FTE ($68,049)due to a duplication in the'07 budget. Delay ordering supplies and reduce Financial Advisory Role for telephone expense by eliminating private lines will result in minimal service impacts. the City (77,149) TOTAL HIGH PERFORMANCE (1,440,383) G:\BUDGET\Exception Process\2007 reductions &add-backs by outcome ATTACHMENT • New Revenue Alternatives 2007 General Fund Budget Work Session July 25, 2006 City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 3- 1 Option 1: Community Park Maintenance Fee t Option I A Option IB Applies to: All residential properties All residential properties Annual Yield to $2.6 Million Annually $4.3 Million Annually General Fund Tax/Fee Amount $4.04 per household per $6.47 per household month per month Approval City Council approval City Council approval required required Annual Cost to Average $48.48 / year $77.64 / year Household Annual Cost to Average Not Applicable Not Applicable Business The Parks Division has refined the Parks Maintenance Fee (PMF) proposal that was • brought before City Council in February 2006. The initial proposal included an option to fund community park maintenance and the Forestry Division. Forestry has now been removed because Forestry services benefit residents and businesses equally, which would require the fee to be applied to businesses as well as residents. Instead, Option 1 B creates a fee to fund maintenance of neighborhood parks as well as community parks. How does it Work? The City currently charges an impact fee on new residential dwelling units to fund construction of new parks. This means we have funding to build new parks but funding to maintain them comes out of the General Fund. This proposal would create a flat fee charged to all residential dwelling units for maintenance of City community parks (Option IA) or for neighborhood and community parks (Option 113). The fee would provide a permanent funding source to pay for maintenance of the developed parks, as well as new parks scheduled to be built over the next 20 years (See below). The fee would eliminate the current and (with appropriate fee increases) the future General Fund financial burden associated with maintenance of City parks. Who pays? The fee is calculated using the number of active residential electric accounts as of December 31, 2005 and estimated residential dwelling units within the City without • separate electric meters. Residential dwelling units are defined in the City Code (Sec.7.5-17). City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 3- 2 • Denver --Boulder-Greeley CPI inflation rates will be used to calculate the annual fee, if approved by City Council and implemented. An administrative fee has been included to cover the cost to the Utility Department for administration of the fee. This fee is an estimate by the Utility Department and may need to be adjusted in the future. The initial monthly fee per household for maintenance of community parks (Option IA) would be $4.04 or $48.48 annually per dwelling unit, providing $2,731,890 in 2007. If a fee for all parks is considered (Option 1 B), the monthly fee would be $6.47 per month or $77.64 annually,per dwelling unit, providing $4,422,730 in 2007. Council may also wish to consider implementation of a rebate program for low income households, based on income levels already established by current sales tax rebate program. The General Fund would need to subsidize the rebate program and the amount of the rebate needs to be determined. The estimated cost of the rebate program (based on rebating 100% of the fee to approximately 1,200 dwelling units) is $58,000 for community parks and $93,000 for all parks. General Fund Revenue Projections 2007 Parks Maintenance Fee Community Community and Revenue Park Fee Neighborhood • Park Fee Maximum General Fund collections in 2007: Only Community Parks $2,731,890 $2,731,890 Neighborhood Parks $1,690,840 Total Fee Revenue $2,731,890 $4,422,730 Administrative Fee (1) <$ 69,000> <$ 69,000> Unrecoverable costs to General Fund in 2007: Rebate Program (1,200 refunds, <$58,000> <$93,000> assuming 100% fee rebate) Savings to the General Fund in 2007 $2,604,890 $4,260,730 (1) Estimated cost from Utility Department to administer fee. History of Revenue Source in Fort Collins This fee has not previously been used in Fort Collins. • City of Fort Collins—Financial Stability Work Session,July 25, 2006 Page 3- 3 • Pros: Cons: • Provides a stable and predictable • May be perceived as a tax increase funding source for parks maintenance needs • Frees up funds to balance the 2007 • Increases utility bills General Fund • Doesn't require voter approval so Residents do not have opportunity to could be implemented in timely approve the fee in advance manner for 2007 Budget year. • Relatively easy to implement via existing utility bills • Parks Maintenance costs would be allocated to residential properties only,not to businesses. Implementation Issues: If City Council directs staff to move forward with implementing the proposed Park Maintenance Fee (PMF) various issues will need to be resolved before implementation on January I, 2007. 1. The utility billing system will need to be modified to add this fee to electric utility bills. • 2. For billing purposes, an analysis will need to be done to accurately capture dwelling units within the City's electric utility boundaries that do not currently have separate electric meters. 3. The type and amount of community outreach needs to be determined. PARK CONSTRUCTION SCHEDULE THRU 2022 Parks Classification Year(l) Acres ProvincelOwn Park Neighborhood 2007 6.5 Spring Canyon Community Park Community 2008 88 Re ist Ride Neighborhood 2009 5 Richards Lake Neighborhood 2010 6 Trailhead Neighborhood 2010 4 Staley Neighborhood 2011 10 Community-Southeast Community 2012 53.4 Maple Hill Neighborhood 2013 7 Fossil Lake Neighborhood 2014 7 Iron Horse Neighborhood 2014 6.5 Elm. School Neighborhood 2015 7 East Community Park Community 2016 50 Lind Neighborhood 2017 4 SideHill Neighborhood 2018 10 Eastrid e Neighborhood 2019 7 Community-North Community 2020 98 Lake Canal Nei hborhood 2022 7 (I) The construction schedule dates are subject to change based on collection of mpact fees. City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 3- 4 • Option 2: PILOTs (Payments in Lieu of Taxes) Applies to: All City Utility customers Annual Yield to General Fund $700,000 Tax/Fee Amount l% addition to Electric PILOT Approval Council Approval Required Annual Cost to Average $5.76 per Year Household Annual Cost to Average See Attachment 5A for examples of Business im act to various size customers How does it Work? PILOT stands for "Payment in Lieu of Taxes." The PILOT is paid to the City's General Fund in place of revenue the City would receive in property taxes, use taxes and • franchise fees if a privately owned utility provided these services in the City. These payments are part of the General Fund revenue that support general City services, including police, fire, library and parks. City Charter requires the payments of PILOTS and City Code establishes the current rate at 6% for electric, water, and wastewater. Staff has examined the City's existing PILOTS to compare the rates charged to other utilities in the area. While the 6% PILOT for the Water and Wastewater Utilities are comparable to others regionally, the Electric PILOT could be increased by 1%to a rate of 7% while remaining regionally comparable. A I% increase in the Electric Utility PILOT would yield approximately $700,000 per year. These funds could be used to help support General Fund services as defined by City Council. At the May 9, 2006 Work Session, City Council Members asked for additional information regarding this proposal. Utilities staff provided a follow-up memo addressing these questions, dated May 30. A copy of this memorandum is attached for Council's reference. See Exhibit 1. Who pays? All city utility rate payers would be assessed the additional PILOT. An additional 1% would be added to the PILOT for Electric utility customers. All or a portion of the rate • increase may be absorbed under current Electric utility rates for 2007, though the electric rates would likely increase in 2008 to cover the additional PILOT amount. City of Fort Collins—Financial Stability Work Session,July 25, 2006 Page 3- 5 History of Revenue Source in Fort Collins PILOTS have been charged to City utility customers since at least the 1954 Charter was approved. Since 1988, the amount of the PILOTS has been set by ordinance, with a rate of 5% from 1989-1997, increasing to 6% from 1997 to the present. Currently, the City's charter provides that: "If the utility is subject to a payment to the general fund in lieu of taxes and franchise fees, an estimate shall be made of the amount of taxes and franchise fees that would be chargeable against such utility if privately owned, and the amount of such payment, as determined by the Council under Article XII, Section 6 of this Charter, shall be charged against the utility fund." (Charter Article V, Section 23) In 2006, the existing PILOTS are estimated to generate about $6.6 Million for the General Fund, with $4.46 million of this amount from the Light and Power Fund. Pros: Cons: • Provides a stable and predictable additional All utility customers would be affected,thus revenue source for General Fund needs the PILOT may be regressive • Is competitive with other Electric rates in May be perceived as a tax increase the private and public sector • All or a portion of the PILOT may be able • to be absorbed in current utility rates in 2007. • Pays for the City services used by the utilities just as paid by other businesses or enterprises: Police,street maintenance, planning etc. • City of Fort Collins—Financial Stability Work Session, July 25,2006 Page 3- 6 • Option 3: Transportation Maintenance Fee Option 3A Option 3B Option 3C Option 3D Applies to: All residential All residential All residential All residential and commercial and commercial and commercial and commercial properties, based properties, based properties, based properties, based on trip generation on trip generation on trip generation on trip generation data data data data Annual Yield to $2.36 million $2.36 million $3.46 million $3.84 million General Fund Annual $120,000 $120000 $120,000 $120,000 Administrative Costs Tax/Fee Amount $1.32 per $1.67 per $1.93 per month, $2.09 per month, per month, per per residential month,per residential unit residential unit unit residential unit Non-residential Non-residential Non-residential Non-residential fee by category fee by category fee by category fee by category (see table below) (see table below) (see table below) (see table below) • Approval Council approval Council approval Council approval Council approval required required required required Annual Cost to $15.84 per $20.04 per $23.16 per $25.0?per Average year year year year Household Annual Cost to See Table below See Table below See Table below See Table below Average Business How does it Work? The proposed Transportation Maintenance Fee (TMF) would be a charge on City utility bills for maintaining City streets, bike lanes, medians (excluding landscaping), and city maintained sidewalks. Maintenance includes such work as keeping pavement surfaces in good condition, performing seal coats as needed, repairing potholes and cracks, repaving and other work to keep our transportation system safe. This work is done to maintain the community's investment in transportation infrastructure. The revenue from the fee could not be used for anything except street maintenance. Other city resources provide the majority of funds for this program. Other funding sources include revenue from the Street Maintenance quarter-cent sales tax approved by voters in 2005, and General Fund on-going funding. Each residential unit would be charged a flat dollar amount ($1.32- 2.09 per month) for the fee. Commercial, industrial and institutional properties are assessed a fee based on City of Fort Collins—Financial Stability Work Session,July 25, 2006 Page 3- 7 • trip generation data—land uses which generate more trips are charged a higher fee than those which generate fewer trips on the transportation system. This "nexus or direct relationship between the fee and the amount that a user utilizes the service is a key aspect of developing the fee. Staff has developed four alternative calculations for the Transportation Maintenance Fee based on Council's May 9 request for additional options, including the following: Option 3A This option fully implements the proposal which was preliminarily accepted as a part of the 2006-2007 BFO process. The adoption of a Transportation Maintenance Fee in the amount of $2.3 million plus implementation costs was assumed in the 2007 Budget adopted by Council in 2005. The full $2.3 million in revenue would be received if $1.32 fee per residential unit (non-residential varies by use) were implemented in January 2007. This fee is calculated based on the assumptions that the City of Loveland used in developing its Street Maintenance Fee. This option generates 64% of revenues from Commercial properties and 36% from residential properties. • Option 3B This option alters the previous option by allocating 50% of all costs to residential properties and 50% to commercial properties. The revenue projection remains the same at $2.3 million per year. Residential properties, assumed to generate 50% of trips would be charged $1.67 per unit per month and non-residential uses vary by land use. (see table below) Option 3C This option maintains the same relationship or nexus of trip costs, but also covers the current General Fund contribution of$779,500 per year plus all General Fund overhead costs for the program, thus raising all fees. Option 3D This option maintains the same relationship or nexus of trip costs, but also covers the cost of maintaining street medians ($370,000 per year), thus raising all fees. Who pays? The basis of this fee is to charge users of the City's transportation system for its maintenance. By charging a fee for the cost of maintenance, a portion of the system would be funded by the parties most frequently using the streets and most directly • benefiting from its maintenance. City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 3- 8 • The fee would be based on the actual cost of maintaining the system, including City streets, bike lanes, medians (excluding landscaping), and city maintained sidewalks. The fee would be allocated to different users based on the average number of trips each type of user generates in a day. This results in a fee structure in which users pay in rough proportion to the extent they use the system. For example, users who add 10 trips per day to the transportation system pay a fee much lower than those user types (i.e. high traffic businesses) that average 300 trips per day. This trip generation theory is similar to the method used to calculate street oversizing fees, and has also been recognized by courts as a fair and legally appropriate way of apportioning costs. Proposed Fee Structure: Staffs original proposed fee structure (Option 3A) would allocate 36% of the fee to residential properties and 64% to non-residential uses. By using the same fee methodology as was adopted by the City of Loveland, the TMF in Fort Collins would equal $1.32 per residential unit and would generate $2.36 million per year for Transportation Maintenance. Fees for each use category would be as follows: Proposed Transportation Maintenance Fee Parcel Use Category Definitions Residential: Any single family,two family,or multi-family dwelling premises.Includes single • family detached housing units, townhouses/patio homes and condominium units,mobile home trailers and multifamily units, including apartments and duplexes. Commercial: Any premises not devoted to Residential,Retail,High-Traffic Retail,Industrial or Institutional purposes. High-Traffic Retail:Any retail establishment which has automobile volumes greater than 1,000 trips per day/per acre.These retail purposes often have gas pumps or drive-through windows(but are not a necessary criteria). Retail: (as opposed to High-Traffic Retail)Any establishment engaged in the sale or rental of goods or services related to the sale or rental of goods to the public. Industrial:Any business devoted primarily to manufacturing,processing or assembly or storage of tangible personal property,research facilities,experimental or testing laboratories,warehouses, distribution or wholesale uses,utility service facilities,aircraft hangars and repair facilities for aircraft,and caretaker's quarters and other accessory buildings reasonably required for maintenance or security of the uses set out in this section. (City of Loveland definition)Includes all manufacturing,construction contracting,transportation,utilities,wholesaling,warehousing and mineral extraction uses. Institutional: Any unit devoted primarily to schools,hospitals,churches,libraries,and similar public and quasi-public uses. Includes churches,cemeteries,hospitals,and other charitable, civic or religious uses. • Trip generation data serves as the basis for developing the proposed fee structure. Truck trips and other vehicle trips are estimated for each land use based on generally accepted City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 3- 9 • trip generation data provided by Institute of Transportation Engineers (ITE) Manuals. The general formula for allocating costs by traffic data includes the following data: For Each category: Average Daily Trips D.U. Total Daily 365 Total Per D.U. or x or Acres = Trips x days = Annual Acre by Category Trips Target Annual Trips per Cost Per Total Annual Annual Revenue — Year = Trip x Trips per D.U. = Fee or Acre D.U. — Dwelling Unit Acres = Parcel acreage for each non-residential utility billing customer This method of fee calculation closely ties the number of trips generated by a type of business with the cost of maintaining roads. Imbedded in this calculation is the assumption that some types of businesses generate greater volumes of truck traffic (which cause more significant road damage) and that some businesses generate greater volumes of other vehicle traffic such as passenger vehicle passing through fast-food • restaurants. High volumes or high truck traffic lead to greater costs per acre of development thus resulting in higher fees in some categories such as "High Traffic Retail" and "Industrial." In addition to allocating costs to non-residential uses, the proposed fee structure acknowledges that a share of the fees should be allocated to businesses which attract traffic from residents outside the City. These trips cannot be allocated to Fort Collins residential uses, and should be attributed to the businesses or institutions which generate the traffic. The effect of this assumption is to allocate the cost of maintenance 36% to residential and 64% to non-residential uses. The Pavement Management Program is funded through a variety of sources. In 2007, if the TMF were approved, 61% of the program would be funded through the Building on Basics Pavement Management Sales Tax (one-quarter cent), 24% through TMF revenue, and 15% by other sources such as the General Fund and Fort Collins' share of State and County transportation taxes. Though the TMF portion of the program is allocated 64% to business uses, the funding of the entire program is more heavily weighted to the individual residential tax or fee payer. Some examples of the impact of the proposed fee on various non-residential uses are provided to illustrate the relative impact of the fees on various businesses in Fort Collins. • City of Fort Collins—Financial Stability Work Session, July 25, 2006 Page 3- 10 Transportation Maintenance Fee Options July 25,2006 Work Session--2007 Budget Issues lRe.1dom.1 tion 3A(Original TMF Proposal) Option 3C (No General Fund Subsidy) tutional $20.04 Per Acre strial $t5.99 Per Acre Instituional $2938 Per Acre High Traffic Retail Industrial $23.44 Per Acre $15247 Per Acre High Traffic Retail $223.54 Per Acre il $63 06 Per Acre Retail 892g6 Per Acre mercial $20.04 Per Acre Commercial $92 6 Per Acre $129 Per Unit Residential $1.93 Per Unto Yield=$2,360,000 Yield=$3,466,557 Monthly Yearly Lot Size in Use Use Monthly Yearly lot Size in Fee Fee Acres Fee Fee Acres Industrial Industrial Manufacturing $8825 $1,059.05 54 Manufacturing $12658 $151891 5.4 Manufacturing $1,14403 $13728.41 70 Manufacturing $1640.80 819,689.6E 70 Retail Retail Pug Sore $135.38 $1,624.52 21 Drug Store $194.17 $2,329.99 2.1 Old Town Restaurant $12.89 $154.72 02 ad Town Restaurant $1849 $221 So 02 Old Town Shop S774 $9283 0.12 Old Town Shop $11.10 $133.14 0.12 Large Retail $63821 $7658.47 99 Large Retail $91535 $10,984.25 9.9 Institutional Institutional Church parge lop $102.58 $1231.01 5 Church(large loll $14690 $1.762.80 5 Church(small lot) $1026 $123.10 o.5 Churn(small lop $1469 $176.28 0.5 Elementary Schod $11079 $1,329.50 54 Elementary School $ 52 $1,933.82 54 High School $246.20 $2,9%44 12 High School $3556.56 E4,23072 12 High Traffic Retail High Traffic Retail Fast Food $281.43 $3,37360 1.a Fund Footl $40237 $482846 16 Bank $18742 $2249.07 1.2 Bank $26826 $3,218.98 12 Convenience Stare $124.95 S1499.38 08 Convenience Store $178K $2,t45.98 0.8 Grocery Store $92149 $1105791 5.9 Grocery Store $1.31889 $15,826.63 5.9 Commercial Commercial Law Of!a $5.13 $61.55 0.25 Law Office $735Mmel 4113 888.14 0. 4 51560 $18958 t4 Motel $2262 $27147 14 Da care Center $15.80 8189.SB OT] Da care Center 822.62 $2]14] 0]] Fee Scenario 3D(No General Fund Option 3B(50/50 Split) Subsidy+ Median Maintenance Costs) Institutional $1671 Per Ache Institutional Industrial $32.54 Per Acre 82710 Par Acre Intlustrial $25.95 Per Acre MgM1 Traffic Retail E127.10 Per Ave High Traffic Retail $24755 Per Abe Retail $52.57 Per Ave Retail $102.39 Par Acre Commercial $1671 Per Acre Residential Commercial $32.5q Per Acre $15]Per Unit Residential $2.09 Per Unit Yield=$2,360,000 Yield=$3,838,949 Monthly Yearly Lot Size in Use U Monthly Yearly Lot Size in Fee Fee Acres Fee Fee Acres Industrial Industrial se Manufadunn9 $71.98 $86378 54 Manufacturng $933.10 $11,19720 70 Manufacturing $140.13 1,68156 5.4 Manuacturng E1816.50 E21798.r]0 70 Retail Retail Drug Store $11040 $1,32476 2.1 Pug Store $21502 $2,58023 21 Old Town Restaurant $10.51 $126.17 0.2 Old Town Restaurant M48 $24574 0.2 ad Town Shop $6.31 $7570 0.12 Old Town Shop $1229 $14T,14 0.12 Large Retail $52044 $6,245.32 9.9 L.M.Retail $101366 $12,163.93 9.9 Institutional Institutional Church(large lop $83.55 $FW260 5 Church(large la) $162.70 $1,95240 5 Church(small lop $836 Sim 26 0.5 Church(small lop $16.27 SIM 24 0.5 Elementary School $90.23 $1,082.81 54 Elementary School $17572 $2,108.59 54 High School $200.52 $2A06.24 12 High School $39048 $40576 12 High Traffic Retail High Traffic Retail Fast Food $22878 $2,745.36 18 Fasl Footl E445.59 $5,347 E6 18 Bank $152.52 $1.83024 1.2 Bank S29706 $3,56472 12 Convenience Store $10168 E1220.15 0.8 Convenience Store $198.04 $2,37648 0.6 Grocery Sore $749.89 $8,998 fib 59 Grocery Store $1460.55 $17,52654 5.g Commercial Commercial Law 84.18 280.73 025 law Office 4556 $W.62 0.25 E1287 $28073 Metal g45.5fi $5466] 14 Da rare Center E1287 E15q 40 01A 77 Da care Center 825.06 $300.fi] OP City of Fort Collins-Financial Stability Work Session, July 25, 2006 Page 3- 11 • Loveland's Example: In 2000, the City of Loveland established a Street Maintenance Fee which is charged to all properties within the Loveland city limits. As an example of one method of setting these fees, Staff collected information about the methodology used for Loveland's fee. Loveland assumes that 68% of trips are generated by non-residential uses, and uses property acreage as a part of its fee calculation. Both of these assumptions will be key parts of the policy development process if the City of Fort Collins pursues implementing a Transportation Maintenance Fee. Both assumptions have a significant impact on the ultimate cost of the fee to various properties. Several other theories regarding the apportionment of costs should be considered. Residential units in Loveland pay $1.40 per unit per month. Residential properties pay 32% of the cost of the service while other property types pay 68%. Non-residential fees are based on the use of the property. These uses tie to trip generation data to determine the property's relative share of the cost of maintaining the transportation system. Commercial, industrial and institutional uses are divided into seven categories. History of Revenue Source in Fort Collins The Transportation Maintenance or Transportation Utility Fee has a long history in Fort Collins, dating back to its adoption by City Council in 1988, and a subsequent review of the fee by the Colorado Supreme Court. A court challenge regarding the ability of the • City to levy such a fee was made and the case was argued at the Colorado State Supreme Court. In the case, the court found that the fee was not a property tax, excise tax or special assessment, but rather a special service fee. Though the fee was upheld, the fee was discontinued. More recently, other cities have used a Special Services Fee and those fees have been found to be appropriate despite challenges regarding the application of the TABOR amendment requirements on the imposition of a fee. A recent Court of Appeals decision reaffirms a home rule city's ability to impose a special service fee and to do so without a TABOR vote as long as: (1) the fee is imposed on persons or property to defray the costs of a particular government service, and not the general expenses of government; (2) the amount generated by the fee must be reasonably related to the overall cost of the service; (3) the methodology used to determine the amount paid by individual fee payers has a rational basis; and (4) revenues generated by the fee are segregated and used only for the purpose for which the fee was imposed. An additional concern has been raised that the City is transferring the "tax" liability for services to fee payers. Adopting the TMF would, in fact, shift part of the cost of street maintenance from the general citizenry to those who use the streets most often and most heavily. Several discussions were held during the budget process suggesting that citizens are • already burdened with too many fees that support general government services. if Council adopts the TMF, it would be the City's only special service fee that is imposed City of Fort Collins—Financial Stability Work Session,July 25,2006 Page 3- 12 • on a City-wide basis for a general government service. The other fees are either impact fees paid by developers to offset the impacts of their developments, or user fees paid by individuals who use City facilities (such as EPIC or the Lincoln Center), or who use services such as those involved in processing permit and license applications. Pros: Cons: • Provides a stable and predictable funding May be perceived as a tax increase source for a basic City service • Shift part of the cost of street maintenance • Costs are distributed more heavily to certain from the general citizenry to those who use businesses,especially those which generate the streets most often and most heavily. high traffic volumes • Ensures that both the portion of the program • Voters approved a '/, cent sales and use tax funded by the Street Maintenance sales tax extension for pavement management in April and the general fund portion of the program 2005. This may appear to be double-dipping have adequate funding levels • Doesn't require voter approval so could be • Some businesses may perceive that they pay a implemented in timely manner for 2007 disproportionate share of the cost Budget year. • Relatively easy to implement via existing • Increases utility bills utility bills Implementation Issues: If City Council directs staff to pursue implementation of the Transportation Maintenance • Fee by January 1, 2007, several issues must be resolved and further data must be collected to finalize the fee calculations. Remaining issues to be addressed include: • Final Database development: For the purposes of this Work Session, staff has created a database of non-residential properties. A number of property owners will need to be contacted individually and properties reviewed to ensure that they are placed in the appropriate category. This work will finalize the fee calculations. • Community outreach and information sharing: Staff has not worked with potentially affected interests to develop awareness of either the problem being addressed by the proposed fee or the impact of the proposal on individuals and businesses. • Implementation costs: Finalize an agreement with Utility Services for the cost of billing the fee on existing utility bills. Currently, a rate of$.]0 per utility bill, per month is being discussed. If this billing cost is finalized, the total billing cost will be approximately $100,000 per year including the cost of staff to maintain the database and address customer service questions. This is significantly less than the original projection of$300,000 per year. • Staffing: Short-term staffing to implement the program and on-going staffing needs must be reviewed and addressed. • Collection of delinquencies: The City must determine how delinquencies will be handled. • Institutional Accounts: Several property owners, such as Poudre School • District, Larimer County, Front Range Community College and the City of Fort Collins have large parcels which would be assessed the fee. Contacting those City of Fort Collins—Financial Stability Work Session,July 25, 2006 Page 3- 13 • specific agencies will be helpful in ensuring compliance with the fee structure. A total of approximately $170,000 per year in revenue would be expected from all governmental properties if they are obligated to pay. • Exceptions: Data must be reviewed to determine if there should be some adjustments to fees for special circumstances. Examples that may require review may include examining large parcels with small portions developed (i.e. less trip generation because a significant portion of the parcel is not yet developed), and multi-use sites (i.e. mixed housing and commercial properties. • • City of Fort Collins—Financial Stability Work Session,July 25, 2006 Page 3- 14 O CD o 0 1c o 0 C C 0 0 W > > O O LL 0 O O N • E O O N Q C 7 O O O O O aD m 0) O O oD N M m c0 W f9 fA fA fA Rn C o '•" O O U O M N C oo a O C N o cd Q aCl+ LL M Qw N C c�i � � O O O N o ..y C V N o > L� O D r o (D �I its CD U) IM cv G C o 0 0 0 % • " y o of o o � c0 0 o O LL coo 0 3 o o R I °> z > md Iq -It a m min m 0 a+ o 0 0 0 f0 X N O U ~ n co V L O m M M W O � 0 0 0 0 R C o 0 0 o c c C) m ' U N c o 3 (D v_ m c # LL w e» va W c N _ o 0 0 0 • � GI L It EA a y 0 O '*o rn o N 0 H N N LL � � y N L 00 O O C O O O o 2006-2007 Pavement Management Program 1 -May-06 BFO BFO Increase % Inc. Funding Source 2006 2007 Decrease Dec. Transportation Fund - ongoing 1 /4 cent sales & use tax 51591 , 935 57845, 445 253, 510 4 .5% Other revenue ( 410 Fund ) 6381288 582 , 967 ( 55 , 321 ) -8 .7 % TMF - Proposed 0 2 , 3001000 2 , 3001000 100 . 0 % Transportation Fund - one-time 1 /4 Cent BCC - Streets & Transportation Package - Savings 4007000 0 (4007000) 100 . 0% General Fund - ongoing 777 , 175 7792549 21374 0 . 3% General Fund - one-time j TABOR - 2004 overage 8001000 0 (8007000) 100 .0 % Total Funding Sources 87207 ,398 9, 507,961 113007563 15 .8% 2006 PMP Shortfall ` Desired Funding Level 8, 929, 984 91507 , 961 577, 977 6 . 5% BFO BFO Increase % Inc . Expenditures by Funding Source 2006 2007 Decrease Dec. Transportation Fund - ongoing Transportation Administration 241 , 778 262 , 486 202708 8 . 6% PMP - Program Costs 519882445 6 , 1657926 177 ,481 3 . 0% PMP - Program Costs (TMF) 0 2 , 3001000 21300 ,000 100 .0% Transportation Fund - one-time PMP - Program Costs 1 , 2007000 0 ( 172007000 ) 100. 0% General Fund - ongoing PMP - Program Costs 660, 285 655, 549 (47736) -0 . 7% Administration Support Service ( Engr. ) 91 , 521 97 , 594 61073 6 . 6% Technology & Equipment ( Engr. ) 25 , 369 26,406 1 , 037 4 . 1 % Total Exp. By Funding Source 812077398 975077961 17300, 563 15 . 8% ' !a N 0�N2406 PMP Short#af ; , y , rv010 v .�,;. Desired Exp. By Funding Level 8 ,9293984 97507 ,961 577, 977 6 . 5% City of Fort Collins—Financial Stability Work Session , July 25, 2006 Page 3- 16 _ Utilities Exhibit 1 6V�x electric • stormwater • wastewater • water City of Fort Collins MEMORANDUM Date: May 30, 2006 To: Mayor and City Council Members Thru: Darin Atteberry, City Manager From: Michael B. Smith, Utilities General Manager YM% Terri Bryant, Utilities Finance and Budget Manager Ellen Switzer, Utilities Financial Operations Manager Re: PILOT Information Requested at the 5/9/2006 Work Session The following are questions and answers related to the electric utility payment in lieu of taxes(PILOT)option discussed by Council during the May 9th financial stability work • session. Question: What are Payments in Lieu of Taxes (PILOTS)? Answer: Payments in lieu of taxes (PILOTS) are a contribution from the utility to the City's General Fund. PILOTs are intended to compensate the General Fund for sales, use and property taxes and franchise fees that the City would receive if the utility were privately owned. City Charter (Art.XI 1, Sec.6) establishes Council authority to set rates, fees or charges for utility services to produce revenues sufficient ...... "to pay into the general fund in lieu of taxes on account of the city-owned utilities such amount as may be established by the Council by ordinance." Question: What is the history of PILOTs payments for the electric utility? Answer: PILOTs have been paid by the electric utility since 1938. The amount has varied from as little as $7,593 (or about 3%of operating revenues)in 1938-1941 to as high as 10- 12%for several years between 1940 and 1962. In 1987, City Ordinance established PILOTS at 6%of operating revenues and that amount has remained constant since. Beginning in 1986 the Utilities' contributions to the General Fund have also included the operation and maintenance of the City's street lighting system. This non-cash contribution was the equivalent of approximately$1,068,166 in 2005 or an additional contribution of 1.35% of operating revenues. Based on Xcel's published street lighting rate schedule, its charges for the City's street lighting system in 2005 would have totaled $1,460,952 or 37% • greater than Fort Collins Utilities cost of service estimate for street lighting. 700 Wood St. • P.O. Box 580 • Fort Collins, CO 80522-0580 • (970) 221-6700 • FAX (970) 221-6619 • TDD (970) 224-6003 e-mail: utilities@fcgov.com . www.fcgov.com/utilities In 2005, the electric utility paid $4,464,628 in PILOTS in addition to providing street • lighting for the city. (Attachment I shows a complete history of the electric utility's payments in lieu of taxes.) Question: Who pays for PILOTs? Answer: All city electric customers have the 6% PILOTs added to their electric bills as specified in the electric rate schedules adopted by Council ordinance. The PILOT is not line-itemed on the utility bill. Question: Does the customer pay sales taxes on PILOTS? Answer: While the City does collect sales tax on both residential and commercial electric bills, the City has made an administrative decision not to collect sales taxes on the PILOTS portion of the electric bill. The State/County only taxes non-residential electric bills, however, both require that sales taxes be collected on the PILOTS portion of the bill. Question: What data is available for payments made in taxes and franchise fees for regional and national investor owned utilities? Answer: Based on 2004 financial statements published for Public Service Company of Colorado (PSC), staff calculates that taxes paid to all entities (other than income tax) total approximately 2.6% of PSC's operating revenue. In addition Colorado cities typically collect a 3% franchise fee from PSC. • Unfortunately regional data for investor owned utilities in the mountain area is not available. Information for other areas was published by American Public Power Association (APPA) in June 2004 (using 2002 data.). The following tables show the data reported by APPA for(1) investor owned utilities, and (2)publicly owned utilities: I' Net Taxes as Percent of Electric Operating Revenue, 2002 Investor Owned Systems by Region Number of First Third Region Utilities Median Quartile Quartile Northeast 32 4.4 2.8 6.2 Atlantic 18 5.6 4.2 7.2 East North Central 27 4.2 3.2 6.2 East South Central 8 3.2 West North Central 14 5.5 4.4 7.0 West So. Central 12 5.0 3.7 5.9 Mountain NA NA NA NA Pacific Northwest 5 3.4 Pacific Southwest 7 5.1 • Total 126" 4.9 3.3 6.7 Quartiles not provided for fewer than 9 responses. '=Hawaii is included in the totals but not in any of the regions. 2 • 2. Net Taxes as Percent of Electric Operating Revenue, 2002 Publicly Owned Systems by Region Number of First Third Re ion Utilities Median Quartile Quartile Northeast 51 3.3 1.8 6.2 Atlantic 66 7.0 2.8 10.7 East North Central 92 3.5 2.5 4.9 East South Central 101 6.5 6.0 7.4 West North Central 134 5.7 3.6 9.1 West So. Central 43 8.8 4.6 12.8 Mountain 24 7.9 4.7 13.8 Pacific Northwest 41 5.6 3,9 8.6 Pacific Southwest 21 4.6 2.7 8.4 Total 573 5.8 3.2 8.5 Question: Why are Xcel's electric rates considerably higher than the Utilities' when they pay less in local and state taxes? • Answer: The following factors are among many that may contribute to the difference in rates: • Xcel is subject to state and federal income taxes not included in the analysis; Fort Collins Utilities does not pay income taxes. • Xcel rates are set to provide a return on investment for its shareholders; Fort Collins Utilities low rates and the PILOTS paid to the General Fund provide a "return on investment" for our citizens/customers. • Xcel has a shortage of generation and must purchase additional power on the market; At this point in time, PRPA has limited need for additional power purchases. • Xcel utilizes rapidly escalating natural gas for generation; PRPA uses natural gas only for peaking generation. • Per the Denver Post, Xcel has higher cost of debt with a credit rating is BBB-,just above junk bond level; PRPA has an AA credit rating. Please let us know if we can provide any additional information. Attachment cc: Diane Jones • 3 • Attachment 1 -CITY OF FORT COLLINS LIGHT&POWER UTILITY HISTORICAL PAYMENTS IN LIEU OF TAXES 7 Retail Operating %of Rate Year Formula Revenues PILOTS Street lighting Revenues Increase Not 1938 $7,593 $234,663 $7,593 Paid by Gen Fund 3.24% Available 1939 $7,593 $247,679 $7,593 Paid by Gen Fund 3.06% NA 1940 $7,593 $259,472 $7,593 Paid by Gen Fund 2.93% NA 1941 $7,593 $261,464 $7.593 Paid by Gen Fund 2-90% NA 1942 $10,000 $260,744 $10,000 Paid by Gen Fund 3.84% NA 1943 $10,000 $265,203 $10,000 Paid by Gen Fund 3.77% NA 1944 $12,000 $275,081 $12,000 Paid by Gen Fund 4-36% NA 1945 $12,000 $293,969 $12,000 Paid by Gen Fund 4.08% NA 1946 $15,000 $318,500 $15,000 Paid by Gen Fund 4.71% NA 1947 $46,000 $383,194 $46,000 Paid by Gen Fund 12.00% NA 1948 $48,000 $421,620 $48,000 Paid by Gen Fund 11.38% NA 1949 $48,000 $447,933 $48,000 Paid by Gen Fund 10.72% NA 1950 $48,000 $483,013 $48,000 Paid by Gen Fund 9.94% NA 1951 $48,000 $512,772 $48,000 Paid by Gen Fund 9.36% NA 1952 $53,865 $533,923 $53,865 Paid by Gen Fund 10.09% NA 1953 $48,000 $572,918 $48,000 Paid by Gen Fund 8.38% NA 1954 $48,000 $612,739 $48,000 Paid by Gen Fund 7.83% NA 1955 $48,000 $673,002 $48,000 Paid by Gen Fund 7.13% NA 1956 $57,000 $717,405 $57,000 Paid by Gen Fund 7.95%% NA 1957 $75,000 $813,741 $75,000 Paid by Gen Fund 9.22% NA • 1958 $75,000 $907,840 $75,000 Paid by Gen Fund 8.26% NA 1959 $85,000 $1,023,952 $85,000 Paid by Gen Fund 8.301% NA 1960 $100,000 $1,158,012 $100,000 Paid by Gen Fund 8.64% NA 1961 $107,600 $1,270,752 $107,600 Paid by Gen Fund 8.47% NA 1962 $144,000 $1,400,201 $144,000 Paid by Gen Fund 10.28% NA 1963 $144,000 $1,569,138 $144,000 Paid by Gen Fund 9.18% NA 1964 $148,000 $1,851,606 $148,000 Paid by Gen Fund 7.99% NA 1965 $164,000 $2,143,148 $164,000 Paid by Gen Fund 7.65% NA 1966 4%of Op.Rev.&$86,400 $2,220,930 $180,000 Paid by Gen Fund 8.10% -6%E 1967 4%of Op.Rev.&$86,400 $2,314,039 $190,000 Paid by Gen Fund 821%% -i t%E 1968 4%of Op-Rev.&$86,400 $2,557,344 $191,300 Paid by Gen Fund Z48% -7%E 1969 4%of Op.Rev.&$86,400 $2,814,850 $197,135 Paid by Gen Fund 7.00% - 1970 4%of Op.Rev.&$86,400 $3,017,797 $208,253 Paid by Gen Fund 6.90% - 1971 4%of Op.Rev.&$86,400 $3,269,159 $218,113 Paid by Gen Fund 6.67% - 1972 7.5%of Operating Revenues $3,922,360 $294,177 Paid by Gen Fund 7.50% - 1973 7.5%of Operating Revenues $4,172,187 $312,914 Paid by Gen Fund 7.50% 10.0% 1974 7.5%of Operating Revenues $4,696,123 $352,086 Paid by Gen Fund 7.500/6 5.00% 1975 7-5%of Operating Revenues $5,950,829 $446,312 Paid by Gen Fund 7.50'/ 16.60/6 1976 Z5%of Operating Revenues $7,173,867 $538,040 Paid by Gen Fund 7.509/6 13 7% 1977 7.5%of Operating Revenues $8,968,352 $672,626 Paid by Gen Fund 7.50% 16.8% 1978 7-5%of Operating Revenues $10,425,004 $781,B75 Paid by Gen Fund 7.50% - 1979 3.75%of Op-Rev.&$0.001038/kWh $11,071,858 $835,179 Paid by Gen Fund 7.54% 11.6% 1980 3.75%of Op.Rev.&$0.001038AWh $14,539,632 $1,012,566 Paid by Gen Fund 6.96% 37.90% 1981 375%of Op.Rev.&$0-001038fkWh $19,524,536 $1,209,817 Paid by Gen Fund 6.201% 16.6% 1982 5%of Operating Revenues $24,621,080 $1,231,054 Paid by Gen Fund 5.001/6 9-5% 1983 5%of Operating Revenues $28,739,215 $1,436,961 Paid by Gen Fund 5-00% 4.0% 1984 5%of Operating Revenues $28,626,683 $1,431,334 Paid by Gen Fund 5.00% -5.7% 1985 5%of Operating Revenues $30,265,972 $1,513,290 Paid by Gen Fund 5.00% - 1986 5%of Op.Rev.&Street lighting $30,612,896 $1,546,876 $631,810 7.12% - • 19117 5%of Op.Rev_&Street lighting $32,208,384 $1.610,419 $637.578 6.98% - 1988 5%of Op.Rev.&Street lighting $35,312,766 $1,765,638 $658,504 6.86% 1989 61%of Op-Rev.&Street lighting $37.857,691 $2,271,461 $668,105 Z76 1990 6%of Op.Rev.&Street lighting $38,075,922 $2,284,555 $682,443 7.79% -3.0°/ 1991 6%of Op.Rev.&Street lighting S39,242,383 $2,354,543 $694,558 7.77% - 1992 6%of Op.Rev.&Street lighting $39,433,614 $2,366,016 $706,759 7.79% - 1993 6% of Op. Rev_& Street lighting $44 ,6002707 $2,6761041 $685,416 7.54% 7.4% 1994 6% of Op.Rev.& Street lighting' $46,594,387 $2,637,418 $705,881 7. 18% 1995 6% of Op. Rev.& Street lighting' $49,031 ,421 $2,7757363 $72211535 7. 13% 1996 6% of Op.Rev.& Street lighting' $51 ,593,748 $2,920,400 $7411941 7.10% 1997 6% of Op. Rev.& Street lighting' $53,9111435 $3,051 ,591 $759,511 7.07% 1998 6% of Op. Rev.& Street lighting' $54,855,272 $3, 102,325 $775,845 7.07% 1999 6% of Op.Rev.& Street lighting' $57,491 ,849 $37254,611 $794,206 7.04% 2000 6% of Op.Rev.& Street lighting' $61 ,547,434 $3114951173 $815,053 7.00% - 2001 6% of Op. Rev.& Street lighting' $651287,967 $3,695,769 $8521T781 6.97% 2.0% 2002 6% of Op. Rev.& Street lighting' $671434,915 $3,801 ,954 $8787065 6.94% - 2003 6% of Op. Rev.& Street lighting' $7072581, 108 $3,9032422 $8927248 6.83% - 2004 6% of Op.Rev.& Street lighting' $737255,892 $4, 146,560 $12042,513 7.08% 5.3% 2005 6% of Op. Rev.& Street lighting' $78,875,097 $4,46411628 $1 ,0681166 7.01 % 4.4% 2006 6% of Op. Rev.& Street lighting' PILOTs are calculated as 6% of Operating revenue less PILOTs beginning in 1994. Prior to 1994 PILOTs were collected as percent of revenue including the PILOT component. Payments in Lieu of Taxes - Fort Collins Electric Utility (Including Street Lighting ) $6 — $5 - -- -- - - - - - - - -- - $a - ---- - - - - - $s --- - - - - --- - -- -- - $2 - --- - -- - - -- - - - $1 - --- — - - — - - —_ - -- - — $o k c0 r V 1� O [h (O O N In dD '7 (� O V) (D O N N CID r 7 V) V V '7 to In to LO c0 c0 c0 r� t� " OD OD DD co O O O O O O 0) 0) 0) 0) 0) 0) 0) (3) 0) 0) O 0) O 0) O 0) O O 0) O O O r r r r r r r r r r r r r r r r r r r N N 1 i r ` m m w o mc `m a .n a ZY a .�. 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