Special City Council Meeting – Budget Overview Session

City Budgeting OVERVIEW 1 Agenda General Council Responsibilities Fund Accounting Principles Enterprise Funds Water Fund Budget Schedule Wastewater Fund Budget Lifecycle Council’s Role in Budgeting City Services General Fund Revenues Capital Funding General Fund Expenses 2  ▪ Provide leadership to the community Council ▪ Adopt local laws, regulations, plans, and ordinances Responsibilities ▪ Approve payables, budgets, and tax levies ▪ Adopt policies guiding the city’s internal operations by resolution, including records retention, personnel, purchasing, investments, Council has etc. specific roles ▪ Confirm appointment and removal of city for the city. appointed officers and confirm appointment Though they and removal of city boards, commissions and come in many committees forms, these ▪ In regard to the financials of the city, the council are the general should ask questions, and understand the responsibilities. reports given by the Treasurer to answer constituents' questions and make the most informed decisions on future projects and policies. 3 City Finances FUND ACCOUNTING 4 Fund Accounting Principles City follows GAAP, GAAP (generally GASB and AIC and accepted accounting guidance and principles), used to standards to meet provide direction on state procedures. governmental accounting GASB (government AIC (Association of accounting standards board) – Idaho Cities) provides specific guidance on provides specific reporting standards, changes reporting guidelines, in asset values or classes, and example reports, certain financial records and support for local updates. finance departments 5  • May 20 (Tues) – Overview of City Finances/Budget Process • May 27 (Tues)– Work Session 1 – Water and Budget Wastewater Schedule • June 10 (Tues) – Work Session 2 (General Fund) • June 24 (Tues) –Work Session 3 • July 15 (Tues) - Work Session 4 – Final Review • July 28 (Mon)- Council adopts tentative budget • August 6-20 - Budget submitted for publication for two weeks • August 25 (Mon) – Public Hearing to Adopt Annual Appropriation Ordinance (the Budget) 6 Budget Lifecycle May – July - Council evaluates the big picture of the Creation City and suggests possible projects or cuts. April-Aug July 28 - Council adopts a preliminary Year End Results Adoption budget. After Audit Aug Aug 28 - Council has public hearing for public to comment on the proposed budget and official adopts the Annual Appropriation Ordinance for the upcoming year. Audit Duration Oct-Jan Oct-Sept Conclusion Sept 7 The End Result – The “Budget” 8 What’s the big picture look like? The Council’s Role in the Budgeting Process 9  The Council’s Role in the Budgeting Process Setting the city’s utility rates and other fees. What levels of service should the city provide? Are there new services the city should provide and how should these services be funded? Is additional staffing needed to provide the necessary services? How do we fund new staff? Or, are services contracted out and how are they funded? How can the budget support the city’s future growth and development? How can we develop a capital budget to invest in the infrastructure necessary to serve new development? Is new infrastructure needed and how can it be funded? What policy priorities should be fulfilled in the budget process? Deciding if cost of living or inflationary pay increases will be granted. 10 Evaluating Competing Budgetary Priorities Will Productivity How Does it Is it Mandated? Increase? Affect Staffing? Will it Reduce What are the Can a Program Liability Priorities of the Offset its Costs? Exposure? Elected Officials? 11  City Services What services should the city provide? Are there new services the city should provide and how should these services be funded? Is additional staffing needed to provide the necessary services? Law Enforcement Fire and Emergency Services Streets Misdemeanor Prosecution Solid Waste / Recycling Drinking Water Wastewater Stormwater Management 12 City Revenues WHERE DOES OUR MONEY COME FROM? (General Fund) 13 Revenue Forecasting Estimating revenue involves predicting future economic conditions, estimating tax bases, and evaluating revenue sources. These projections form the basis for budget planning, ensuring the continued funding of essential services and allowing for future planning. 14 Where Does the Money Come From? Governmental resources constitute City Property Tax. Cities may increase 61% of the total revenue for the the property tax portion of their budget General Fund: up to 3%. The maximum increase, including new construction and City property tax (35%) annexation levies, cannot exceed 8% in State sales tax revenue (12%) total. State highway revenue (12%) State Liquor Sharing (3%) State-Shared Sales Tax Revenue. The State allocates 11.5% of sales tax revenue to counties, cities and non-school special districts. For fiscal year 2024 ending Sept. 30, 2024, sales tax revenue decreased for the second consecutive year. FY25 estimates were for a 4.1% decrease in revenue sharing dollars to cities. 15 Where Does the Money Come From? State-Shared Highway Revenue. The State Highway Distribution Account Governmental resources constitute provides over $250 million to local 61% of the total revenue for the highway jurisdictions annually. These General Fund: revenues are allocated solely on the City property tax (35%) basis of population. Bellevue received State sales tax revenue (12%) $278,089 of highway revenue in FY24. State highway revenue (12%) Bellevue is slated to receive just under State Liquor Sharing (3%) $200,000 in FY25. State Liquor Sharing comprised 3% of income for FY24. For FY25, is expecting to receive $260,000. 16 Where Does the Money Come From? The balance of funds, 39%, is comprised of city LOT tax, franchises, charges for services, licenses, permits, fees, grants, administrative fees and other. 17  In June 2022, after voter approval, Bellevue adopted Ordinance 2022-04 establishing a 3% LOT tax on hotel-motel lodging. The Ordinance also pertains to LOT TAX – condominiums, tourist homes and any Local other entity that rents or leases for occupancy temporary lodging to Option individuals for less than 30 days. Tax The Ordinance provides that LOT revenues are dedicated to road repair, As a designated “resort city” this is a revenue maintenance, transportation stream that has been enhancements, equipment, and snow under-utilized by removal. Current LOT revenues account Bellevue. for 3% of city income. 18  GENERAL FUND REVENUES FY24 State Shared Revenue 15% City Property Tax 35% State Highway Funds 12% Admin Fees 8% Charges for Services 6% Franchises 4% LOT Tax 3% State Liquor Sharing 3% Dev. Impact Fees 3% Court Fees 3% Grants & Donations 1% Other 9% Interest on Investments 1% Other includes licenses, permits (non-building), fees, fines, park fees, sign permits and misc. 19 Income the City has Authority Over 20 Franchise Revenue Current franchise revenue accounts for 4% of the city’s income. FY24 Franchise Revenue Cox = $ 9,629 ID Power = $60,766 IGC = $21,900 Total FY24 = $92,296 FY23 Total = 97,553 FY22 Total = 83,260 A fourth franchise agreement is currently in negotiation with Clear Creek Disposal. 21 Capital Funding PLANNING FOR FUTURE INFRASTRUCTURE (General Fund) 22  The City contracted with Richard Caplan and Development Associates to prepare an impact fee study dated November 30, 2022. Impact The City’s current impact fees are based on this study and are designated for the cost of the capital Fees (DIF) improvements element of the comprehensive plan. Pursuant to City Code 9-5-10-02, DIF fees may not be held for longer than 8 years unless it identifies in writing: a) a reasonable cause why the fees should be held longer than 8 years; and b) an anticipated date by which the fees will be expended, but in no event greater than 11 years from the date they Bellevue City Code, were collected. Title 9, Chapter 5 Pursuant to City Code 9-5-14-01, unless City Council Idaho Code, Title 67, Chapter 82 deems some other period is appropriate, the City shall, at least once every 5 years review the capital improvements plan. 23 Development Impact Fees (DIF) THIS FY TO DATE (3/31/25) TOTAL COLLECTED SINCE MAY 2021 Total fees collected by Dept: Admin . . . . . . . . . . $15,000 B & G . . . . . . . . . . . $32,429 Comm. Dev. . . . . . . $36,942 Fire . . . . . . . . . . . . . $55,407 Library . . . . . . . . . . $ 3,006 Marshal . . . . . . . . . $ 5,493 Parks . . . . . . . . . . . . $ 5,602 Streets . . . . . . . . . . $58,732 Total: $212,671 Budgeted DIF Fees for FY25 = $ 69,993 24  IC 67-8203(24) "Public facilities" means: City Municipal Code 9-5-12. Use (a) Water supply production, treatment, storage of Development Impact Fees. and distribution facilities; The monies collected from the (Dept (b) Wastewater collection, treatment and disposal Name) development impact fees facilities; shall be used only to plan for and (c) Roads, streets and bridges, including rights-of- acquire or construct (Dept Name) way, traffic signals, landscaping and any local capital facilities, or to pay debt components of state or federal highways; service on any portion of any future (d) Stormwater collection, retention, detention, general obligation or revenue bond treatment and disposal facilities, flood control issue or similar instrument used to facilities, and bank and shore protection and finance the acquisition or enhancement improvements; construction of (Dept Name) capital (e) Parks, open space and recreation areas, and facilities within the City, or to related capital improvements; and reimburse the City for such costs. (Ord. 2021-03, 3-22-2021) (f) Public safety facilities, including law enforcement, fire stations and apparatus, emergency medical and rescue, and street lighting facilities. 25  Current Capital Improvements Plan - GF (a) Low value and type of Community Development expenditure is not considered to be a DIF eligible capital improvement. (b) Includes projects in FY 2024 included in 2020 CIP but not yet funded. 26 Current Capital Improvements Plan – Water and Wastewater Funds 27  Reserves / Carryover Don’t Spend it All—Build Up Reserves. The City’s fund balance (cash) started Fiscal Year 2024 at $589,742. The General Fund balance increased $217,403 during the fiscal year. This is a big accomplishment compared to the $282,697 decrease in fund balance in FY23. The City’s ending General Fund balance as of Sept. 30, 2024, was $807,145. Don’t Use One-Time Money for Ongoing Expenses. 28 City Expenditures WHERE DOES OUR MONEY GO? (General Fund) 29  Personnel – 63% How Does the Money General Operations = 28% Get Used? Capital Expenditures = 9% • Construction and Improvements • Long-term leases and purchases of equipment and autos • Computer/Software Purchases Note: Percentages are based on FY25 budget. 30 Capital Leases / Debt Service Buildings and Grounds – ▪ Real property lease of lot next to the Bellevue Museum for $1,625/year Fire – ▪ 2021 Ford F-150 - $7,514.33 per year (Dec 2020 to Feb 2026) ▪ Pierce 7400 Responder Fire Truck - $21,169/year (2017 to 3/7/27) Marshal – ▪ 2022 Dodge Durango - $20,310/year ▪ 2022 Dodge Durango for $18,346/year Streets – ▪ 2023 Chevrolet HD 5500 Truck - $1,826 per month 5 years (Nov 2023 to Nov 2030) ▪ 2024 Caterpillar 938M Loader - $30,383/year (Nov 2023 to Nov 2030) ▪ 2024 Bobcat Loader - $1,581 per month (June 2024 to June 2027) Total Per Year: $140,231 --- GF portion = $92,720 31  GF PAYROLL SUMMARY FY25 Streets 14% Admin Parks 26% 3% Bldgs & Grounds 1% Marshal 33% Comm. Dev. / P&Z 13% Fire Library 4% 6% Admin B&G CD Fire Library Marshal Parks Streets Totals: Wages $ 289,284 $ 10,764 $ 147,020 $ 71,234 $ 43,380 $ 354,093 $ 29,049 $ 141,447 $ 1,086,272 Tax $ 22,130 $ 823 $ 10,979 $ 2,833 $ 3,319 $ 27,088 $ 2,222 $ 10,821 $ 80,216 Insurance $ 51,600 $ 5,040 $ 25,200 $ 1,500 $ 12,600 $ 51,600 $ 6,048 $ 29,484 $ 183,072 Worker's Comp $ 608 $ 453 $ 59 $ 1,449 $ 55 $ 12,270 $ 81 $ 7,500 $ 22,474 Retirement $ 34,364 $ 386 $ 17,165 $ 5,425 $ 5,188 $ 51,875 $ 3,474 $ 16,917 $ 134,795 TOTALS: $ 397,987 $ 17,467 $ 200,423 $ 82,441 $ 64,542 $ 496,926 $ 40,874 $ 206,169 $ 1,506,829 32 General Operations Expenses by Account & Department Operating Expenses Admin B&G CD Fire Library Marshal Parks Streets TOTALS 51020 · Advertising / Publishing $ 500 $ 1,000 $ 200 $ 1,700.00 51060 · Computer IT Support* $ 15,000 $ 15,000.00 51062 - Computers - Software & Subs. $ 17,000 $ 3,000 $ 250 $ 20,250.00 51073 - Contract Labor $ 3,000 $ 2,200 $ 20,000 $ 25,200.00 51073.1 - DBS Contract Labor $ 39,172 $ 39,172.00 51075 - Contingency Fund $ 10,000 $ 10,000 $ 10,000 $ 10,000 $ 10,000 $ 50,000.00 51080 · Dues & Memberships $ 1,200 $ 100 $ 3,800 $ 350 $ 800 $ 100 $ 6,350.00 51110 - Fuel $ 4,000 $ 15,000 $ 13,000 $ 32,000.00 51125 - Interest Expense $ 8,600 $ 8,600.23 51130 - Equipment Lease $ 17,000 $ 17,000.00 51140 · Legal Fees $ 8,000 $ 10,000 $ 200 $ 18,200.00 51145 · Legal - Prosecuting Attorney $ 22,000 $ 22,000.00 51150 · Liability Insurance $ 6,915 $ 714 $ 3,495 $ 2,692 $ 938 $ 8,701 $ 878 $ 8,274 $ 32,607.55 51160 · Repairs & Maintenance (General) $ 6,654 $ 3,000 $ 500 $ 10,154.00 51163 · M & R - Equipment (non-vehicle) $ 5,000 $ 7,518 $ 12,518.00 51164 - M & R - Streets $ 10,000 $ 10,000.00 51165 - M & R Trees $ 4,000 $ 4,000.00 51166 - M & R Snow (LOT) $ 50,000 $ 50,000.00 51167 · M & R - Autos $ 5,000 $ 7,000 $ 5,000 $ 17,000.00 51168 - M & R Street Lights $ 2,000 $ 2,000.00 51177 · Misc Expense $ 500 $ 500 $ 500 $ 1,500.00 51180 · Office Equipment Rental/Repair $ 7,304 $ 250 $ 7,553.84 52010 · Office Supplies $ 9,000 $ 100 $ 1,200 $ 250 $ 10,550.00 52020 · Internet Expense $ 4,164 $ 4,164.00 52040 · Postage, Copies, Mailing $ 6,000 $ 6,000.00 52050 · Professional Services $ 5,000 $ 7,000 $ 12,000.00 52052 - Prof. Engineering $ 12,000 $ 12,000.00 52070 - Signs $ 300 $ 2,000 $ 2,300.00 52080 · Small Tools & Equipment $ 2,000 $ 800 $ 2,000 $ 4,800.00 52085 · Storage $ 800 $ 800.00 52090 - Supplies $ 1,000 $ 1,000 $ 500 $ 500 $ 600 $ 4,000 $ 7,600.00 52100 · Telephone $ 11,000 $ 600 $ 602 $ 2,950 $ 750 $ 15,902.00 52120 · Training & Meetings $ 2,000 $ 700 $ 2,000 $ 200 $ 5,000 $ 1,500 $ 11,400.00 52124 - Travel Expense $ 600 $ 300 $ 1,500 $ 3,000 $ 500 $ 5,900.00 52130 - Uniforms $ 1,000 $ 5,000 $ 1,500 $ 7,500.00 52140 · Utilities - Gas $ 6,000 $ 6,000.00 52143 - Utilities - Power $ 7,700 $ 7,700.00 33 General Operations Expenses by Account & Department Operating Expenses Admin B&G CD Fire Library Marshal Parks Streets TOTALS 52145 - Utilities - Street Lights $ 20,000 $ 20,000.00 52146 - Utilities - Trash / Toilet $ 3,000 $ 3,000 $ 6,000.00 55000 - Library - New Books $ 1,800 $ 1,800.00 55010 - Library Programs $ 2,500 $ 2,500.00 56010 - 911 Dispatch $ 28,886 $ 28,886.19 56020 - Service Contracts $ 15,000 $ 15,000.00 56030 - Investigations (Fire) $ 150 $ 150.00 56040 - Medical/Lab Kits $ 500 $ 500.00 56045 · Radio Fees $ 240 $ 2,640 $ 500 $ 3,380.00 56047 · RMS/CAD $ 4,000 $ 13,199 $ 17,199.05 56050 · Specialized Equipment $ 10,000 $ 10,000.00 57000 · Safety Equipment $ 40,000 $ 1,500 $ 500 $ 42,000.00 Total Operating Expenses: $ 142,482.84 $ 28,068.28 $ 77,367.32 $ 94,083.90 $ 10,237.90 $ 132,626.58 $ 28,578.31 $ 151,391.73 $ 664,836.86 Admin B&G CD/P&Z Fire Library Marshal Parks Streets 58000 - Capital Expenses 58120 · Construction & Improvement $ 11,000.00 $ 20,000.00 58150 · Auto/Equipment Lease (12+ mos) $ 20,083.46 $ 38,656.00 $ 23,440.00 58160 · Auto or Equipment Purchase 58190 - Real Property Lease $ 1,625.00 58250 - Street Construction $ 100,000.00 Total Capital Expenses: $ - $ 12,625.00 $ - $ 20,083.46 $ - $ 38,656.00 $ 20,000.00 $ 123,440.00 $ 214,804.46 TOTAL OPERATING AND CAPITAL $ 142,482.84 $ 40,693.28 $ 77,367.32 $ 114,167.36 $ 10,237.90 $ 171,282.58 $ 48,578.31 $ 274,831.73 $ 879,641.32 EXPENSES FY25: 34 Enterprise Funds WATER AND WASTEWATER FUNDS 35 Enterprise Funds Enterprise funds are established to operate as self-sustaining businesses within a municipal government. Revenues are generally restricted and can only be used for the specific enterprise’s operations, maintenance, capital improvements and debt service obligations for that specific fund. 36 Water Fund Revenues Water User Fees Other Income Operating revenue comes from water Water received ARPA grants for user fees, charges and new $79,999 last year and invested funds connections. FY24 user fees were for water earned interest of $43,545 $458,691. Hookups and connections in FY24. were $38,426 for total user fees of $498,025. Water Capitalization (CAP) Fee Total income for FY24 was $620,472. Water CAP fees are for future water capital needs. FY24 income was $33,306 for a total ending balance in savings of $567,998 from Water CAP fees. 37 How Does Personnel = 20% the Water Fund General Operations = 63% Money Get Used? Capital Expenditures = 17% • Construction and Improvements • Long-term leases and purchases of equipment/autos • Computer/Software Purchases Note: Percentages are based on FY25 budget. 38  Water Fund Expenses This chart does not include the Capital, $3.3M grant. Personnel, $104,640 , $123,926 , 16% 20% Ongoing Capital Expenses: ▪ 2023 Chevrolet HD 5500 Truck - $609/month (Ends Nov 2030) ▪ 2024 Caterpillar 938M Loader - $10,128/year (Ends Nov 2030) ▪ 2024 Bobcat Loader - $527/month (Ends June 2027) Operations, $400,575 , 64% Personnel Operations Capital 39  Drinking Water Improvement Plan Water Bellevue residents approved a water bond to replace aging components, Fund secure long-term access for Capital construction, operation and maintenance of the infrastructure Project necessary to continue to use the Seamons Creek surface water rights. The project is in early stages of studies necessary to develop engineering $3.3M grant plans for construction. Project (to be used prior to loan) completion is scheduled for the end of $6.3M loan 2026. 40 Wastewater Fund Revenues Wastewater User Fees Operating revenue comes from Other Income wastewater user fees, charges and new connections. FY24 user fees were Wastewater received ARPA $1,161,816. grants for $49,999 last year and invested funds for Wastewater earned interest Wastewater Capitalization (CAP) Fee of $50,499 in FY24. Water CAP fees are for future water capital needs. FY24 income was $33,300 for a total ending balance in savings of $223,566 from CAP fees. Total income for FY24 was $1,346,713. 41 How Does the Personnel = 10% Wastewater Fund General Operations = 42% Money Get Used? Capital Expenditures = 48% • Construction and Improvements • Long-term leases and purchases of equipment/autos • Computer/Software Purchases Note: Percentages are based on FY25 budget. 42 Wastewater Fund Expenses Personnel 10%, $148,840 Ongoing Capital Expenses: ▪ 2023 Chevrolet HD 5500 Truck - $609/month (Ends Nov 2030) Capital ▪ 2024 Caterpillar 938M Loader - (48%), $10,128/year (Ends Nov 2030) $688,947 ▪ 2024 Bobcat Loader - $527/month (Ends June 2027) Operations $42%, $612,017 Personnel 10% Operations $42% Capital (48%) 43  Beginning November 2010, the City obtained a construction loan for the Wastewater Wastewater treatment plant. Fund Capital The Revolving Promissory Note Series 2010 was for $6M at 3.25% per Project annum. The note is scheduled to be paid off in 2031. The current balance of the loan is approximately $2.4M. 44 What’s Next? CITY COUNCIL BUDGET WORK SESSIONS 45 Questions? 46 Diane Shay’s Budget Book FY26