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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/02/2010 - FIRST READING OF ORDINANCE NO. 111, 2010, BEING TH DATE: November 2, 2010 STAFF: Darin Atteberry Mike Freeman First Reading of Ordinance No. 111, 2010, being the,Annual Appropriation Ordinance Relating to the Annual Appropriations for the Fiscal Year 2011 and Adopting the Budget for the Fiscal Years Beginning January 1, 2011 and Ending December 31, 2012, and Fixing the Mill Levy for Fiscal Year 2011. EXECUTIVE SUMMARY The Annual Appropriation Ordinance is presented for First Reading. This Ordinance sets the City Budget for the two year period (2011-2012). The approved Budget becomes the City's financial plan for the next two fiscal years. BACKGROUND / DISCUSSION This biennial Budget represents the work of many dedicated individuals who came together to participate in the budget process. Since 2005, the City has used the Budgeting for Outcomes (BFO) process. BFO has a number of advantages over traditional budgeting approaches and helps the City meet several important goals, including: • Create clarity about the overall budget process for the community; • Allocate revenues to the highest priorities and outcomes citizens want and need; • Understand the choices for funding programs and services; and • Emphasize staff accountability, efficiency, innovation and partnership. Using this approach, City Council and staff worked in close collaboration over the past two months to build a financial plan,based on revenue available,thatwill achieve service outcomeswhich matter most to the citizens and community. This work has resulted in the development of the Final 2011-2012 Budget. The approval of the Appropriation Ordinance on First Reading represents a major milestone in this process. As the budget development process began in February 2010, City Council and staff met on several occasions to outline goals and assumptions for developing the recommended budget. Council was actively engaged in the development and approval of the seven key outcomes that have shaped this budget. Result Area/Outcome Description Culture, Parks and Recreation Fort Collins provides diverse parks, cultural, and recreational amenities. Economic Health Fort Collins has a healthy, sustainable economy reflecting the values of our unique community in a changing world. Environmental Health Fort Collins promotes, protects and enhances a healthy and sustainable environment. High Performing Government Fort Collins exemplifies an efficient, innovative, transparent, effective and collaborative city government. Neighborhood Livability Fort Collins fosters and supports a variety of quality neighborhoods. Safe Community Fort Collins provides a safe place to live, work, learn and play. Transportation Fort Collins provides for safe and reliable multi-modal travel to, from, and throughout the City. November 2, 2010 -2- ITEM 15 Budget Highlights The 2011-12 Final Budget is a financial and service plan linked to the seven key outcomes and results that matter most to our citizens. Some key highlights of the City Budget include: 1. The total Budget for all City funds for 2011 is $425.8 million and $426.4 million for 2012. 2. The Budget includes no tax increase. 3. Sales and Use tax revenue accounts for approximately 55%of the General Fund revenue collected annually. This tax revenue is projected to increase by 1.5% in 2011 with a slightly larger increase in 2012 of 2.9%. 4. The projected Utility rate increases for 2011 to fund operations and maintain minimum reserves are a 9% increase for Wastewater, a 6.5% increase for Electric, a 3% increase for Water and no increase for Stormwater. For 2012, the projected Utility rate increases are an 8% increase for Wastewater, a 6.23% increase for Electric and no increases for Water and Stormwater. 5. In 2011 the Budget will reduce classified, unclassified, and contractual City staff by a net of 13.28 full-time equivalent(FTE) positions. The estimated reduction in hourly staff in 2011 is 25 FTE positions. For 2012, the net change is an additional decrease of 5.75 FTE for classified, unclassified,and contractual City staff and a decrease of approximately 10 hourly FTE. Budget Assumptions 2010 2011 % Change 2012 % Change Operating 448.7 $379.7 -15.4% $386.9 1.9% Debt $21.3 $22.8 7.0% $23.2 1.8% Capital $28.0 $25.0 -10.7% $18.1 -27.6% Total City Appropriations 498.0 427.5 -14.2% $428.2 0.2% Less Internal Service Funds - 58.1 - 55.2 -5.0% 57.0 3.3% Less Transfers to Other Funds - 95.4 39.9 -58.2% 38.5 3.5% Net City Budget $344.5 $332.4 -3.5% $332.7 0.1 Note: This includes GID and URA which will be appropriated in separate ordinances. Some of the key assumptions used in developing the Final Budget include: 1. Limited revenue growth for 2010 and 2011 i Despite the stabilization of the economic conditions in 2010,most experts agree that the recovery will continue to occur gradually with sectors of the economy enduring a lasting reduction in output and employment. The 2011-2012 Budget,therefore,employs conservative assumptions of growth that reflect a cautiously optimistic outlook for the next two years. 2. Use of reserves Approximately $4.2 million in General Fund reserves were used to balance the 2011 budget and $712,000 in the 2012 Budget. Reserves are used primarily for one-time projects. 3. Employee salary adjustments No merit-based pay increases are budgeted for City employees in 2011, and any adjustments in 2012 (not to exceed 2%)will be based on the market conditions. The budget also includes two unpaid furlough days for all City employees in 2011. November 2, 2010 -3- ITEM 15 4. Focus on City Council and community priorities and adjust to changing revenues This Budget continues to place a high priority on the services identified by citizens and City Council as most important. Due to significant decreases in revenue,this Budget includes reductions in several areas,including parks and recreation and general government. Adjustments to the City Manager's Recommended Budget During previous Budget work sessions, Council did not provide any collective change in direction on the Budget. Accordingly, there are no changes for First Reading on the City Manager's Recommended Budget. An additional Budget discussion is scheduled for the November 9 Work Session. Conclusion The 2011-2012 Final Budget is a sound financial plan to deliver the services the citizens value most. Due to limited resources, it does not, however, fully meet the demand for services that citizens need and expect. However, the Budgeting for Outcomes process has enabled staff to focus and apply the resources available to key community outcomes. Citizens will receive excellent value for their tax dollars. Any final amendments agreed to by Council will be included in the Second Reading of the Budget Ordinance on November 16, 2010. By Charter, the Budget must be adopted and appropriations for the 2011 fiscal year must be adopted by November 30, 2010. FINANCIAL/ ECONOMIC IMPACTS This Ordinance represents the annual appropriation for fiscal year 2011, and adopts the total City budget for fiscal year 2011 at$425.8 million and for fiscal year 2012 at$426.4 million. This Ordinance also sets the City mill levy at 9.797 mills, unchanged since 1991, for fiscal year 2011. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. ORDINANCE NO. 111, 2010 OF THE COUNCIL OF THE CITY OF FORT COLLINS BEING THE ANNUAL APPROPRIATION ORDINANCE RELATING TO THE ANNUAL APPROPRIATIONS FOR THE FISCAL YEAR 2011; ADOPTING THE BUDGET FOR THE FISCAL YEARS BEGINNING JANUARY 1, 2011, AND ENDING DECEMBER 31, 2012; AND FIXING THE MILL LEVY FOR FISCAL YEAR 2011 WHEREAS,the City Manager has,prior to the first Monday in September,2010,submitted to the City Council a proposed budget for the next ensuing budget term, along with an explanatory and complete financial plan for each fund of the City, pursuant to the provisions of Article V, Section 2, of the City Charter; and WHEREAS, within ten days after the filing of said budget estimate, the City Council set September 21 and October 5, 2010, as the dates for the public hearings thereon and caused notice of such public hearings to be given by publication pursuant'to Article V, Section 3, of the City Charter; and WHEREAS, the public hearings were held on those dates and persons were given the opportunity to appear and object to any or all items and estimates in the proposed budget; and WHEREAS, Article V, Section 4, of the City Charter requires that, before the last day of November of each fiscal year, the City Council adopt the budget for the ensuing term by ordinance and appropriate such sums of money as the Council deems necessary to defray all expenditures of the City during the ensuing fiscal year; and WHEREAS,Article V, Section 5,of the City Charter provides that the annual appropriation ordinance shall also fix the tax levy upon each dollar of the assessed valuation of all taxable property within the City, such levy representing the amount of taxes for City purposes necessary to provide for payment during the ensuing fiscal year for all properly authorized expenditures to be incurred by the City; and WHEREAS, Article XII, Section 6, of the City Charter permits the City Council to fix, establish, maintain, and provide for the collection of such rates, fees, or charges for water and electricity, and for other utility services furnished by the City as will 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 City Council. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. Budget a. That the City Council has reviewed the City Manager's 2011-2012 Recommended Budget, a copy of which is on file with the office of the City Clerk, and has approved certain amendments thereto. b. That the City Manager's 2011-2012 Recommended Budget, as amended by the Council, is hereby adopted, in accordance with the provisions of Article V, Section 4, of the City Charter and incorporated herein by reference; provided,however,that the comparative figures contained in the adopted budget may be subsequently revised as deemed necessary by the City Manager to reflect actual revenues and expenditures for the fiscal year 2010. C. That the adopted budget,as amended,shall be maintained in the office of the City Clerk and identified as "The Budget for the City of Fort Collins for the Fiscal Years Ending December 31,2011,and December 31,2012,as Adopted by the City Council on November 16, 2010." Section 2. Appropriations. That there is hereby appropriated out of the revenues of the City of Fort Collins, for the fiscal year beginning January 1, 2011, and ending December 31, 2011, the sum of FOUR HUNDRED TWENTY FIVE MILLION SEVEN HUNDRED NINETY THOUSAND SEVEN HUNDRED ELEVEN DOLLARS ($425,790,711) to be raised by taxation and otherwise, which sum is deemed by the City Council to be necessary to defray all expenditures of the City during said budget year,to be divided and appropriated for the following purposes,to wit: GENERAL FUND $103,482,975 ENTERPRISE FUNDS Golf $2,879,387 Light & Power Operating Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104,907,193 Capital: Electric Substations 315,000 Southwest Annexation Electric System 1,755,000 Capital Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,070,000 Total Light& Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106,977,193 -2- Storm Drainage Operating Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,746,019 Capital: Asset Management 83,333 Canal Importation Basin 2,840,000 Drainage & Detention System 370,000 Stormwater Developer Repays 95,000 Stormwater Master Planning 95,000 Capital Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,483,333 0 Total Storm Drainage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,229,352 Wastewater Operating Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,073,294 Capital: Asset Management 83,334 Collection System Replacement 1,230,000 Collection System Study 170,000 DWRF Improvements 100,000 Engineering Collection System Replacements 700,000 Flow Monitoring Stations 100,000 North College Sewer 900,000 Sludge Disposal Program 100,000 Water Reclamation Replacement 975,000 Capital Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,358,334 Total Wastewater . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,431,628 Water Operating Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,767,591 Capital: Asset Management 83,333 Cathodic Protection 170,000 Distribution System Replacement 975,000 Engineering Distribution System Replacements 1,910,000 Halligan Reservoir Enlargement 190,000 Water Production Replacement Program 1,175,000 Water Supply Development 100,000 Capital Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,603,333 Total Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,370,924 TOTAL ENTERPRISE FUNDS $176,888,484 -3- INTERNAL SERVICE FUNDS Benefits $21,702,110 Data& Communications 7,410,443 Equipment 9,457,218 Self Insurance 3,247,228 Utility Customer Service & Administration 15,462,965 TOTAL INTERNAL SERVICE FUNDS $ 57,279,964 SPECIAL REVENUE FUNDS Capital Improvement Expansion Fund $ 619,354 Capital Leasing Corporation Fund 5,290,795 Cemeteries 587,558 Cultural Services 3,223,584 Debt Service 359,820 General Employees' Retirement 3,043,926 Natural Areas Fund 8,447,731 Perpetual Care 45,395 Recreation 6,400,152 Sales and Use Tax 11,098,000 Street Oversizing 2,978,079 Timberline/Prospect SID 106,885 Transit Services 9,989,823 Transportation Services 25,422,387 TOTAL SPECIAL REVENUE & DEBT SERVICE FUNDS $77,613,489 CAPITAL IMPROVEMENT FUNDS General City Capital City Bridge Program $ 300,000 I-25 & SH 392 Interchange and Improvements 2,640,000 Police Facility 750,000 Railroad Crossing Replacement 100,000 TOTAL GENERAL CITY CAPITAL $ 3,790,000 1/4 Cent - Building on Basics Administrative Charge $ 34,914 Bicycle Program Plan Implementation 125,000 Museum/Discovery Science Center 115,113 North College Avenue Improvements 4,275,671 Pedestrian Plan and ADA Improvements 300,000 TOTAL 1/4 CENT - BUILDING ON BASICS $ 4,850,698 -4- Conservation Trust Fund Administration $ 198,918 Trail Acquisition / Development 350,000 Open Space Acquisition 10,000 Fossil Creek Trail 50,000 Transfer to General Fund-Parks Maintenance 923,704 TOTAL CONSERVATION TRUST FUND $1,532,622 Neighborhood Parkland Fund Administration $ 187,679 Equipment Replacement 15,000 New Park Site Acquisition 150,000 TOTAL NEIGHBORHOOD PARKLAND FUND $ 352,679 TOTAL CITY FUNDS $425,790,911 Section 3. Mill Levy a. That the 2011 mill levy rate for the taxation upon each dollar of the assessed valuation of all the taxable property within the City of Fort Collins as of December 31,2010,shall be 9.797 mills,which levy represents the amount of taxes for City purposes necessary to provide for payment during the aforementioned budget year of all properly authorized expenditures to be incurred by the City. b. That the City Clerk shall certify this levy of 9.797 mills to the County Assessor and the Board of Commissioners of Latimer County,Colorado,in accordance with the applicable provisions of law, as required by Article V, Section 5, of the Charter of the City of Fort Collins. -5- Introduced, considered favorably on first reading, and ordered published this 2nd day of November,A.D. 2010,and to be presented for final passage on the 16th day of November,A.D.2010. Mayor ATTEST: City Clerk Passed and adopted on final reading on the I6th day of November, A.D. 2010. Mayor ATTEST: City Clerk -6-