City Commission Workshop Meeting

City Hall City of Eustis, Florida 10 North Grove Street Post Office Drawer 68 Eustis, FL 32727-0068 Meeting Minutes - Final* City Commission Workshop Thursday, January 31, 2013 4:00PM Eustis Woman's Club Building, 227 N. Center St., Eustis CALL TO ORDER: Mayor Muenzmay ACKNOWLEDGEMENT OF QUORUM AND PROPER NOTICE Present: 5 - Linda Bob; Albert Eckian; Michael Holland; Karen LeHeup-Smith; and Kress Muenzmay I. REVIEW/UPDATE: 13o2o A. Review/Update of Commission Rules & Responsibilities B. Review/Update of Commission Success Statement 2013; House Rules; Protocols Paul Berg, City Manager, reviewed the planned agenda for the workshop and the Commission list of responsibilities. The Commission discussed the monitoring of performance and project results citing those projects that appeared to have problems or delays. CONSENSUS: It was a consensus of the Commission for staff to provide recommended milestones for monitoring upon approval of major or functionally significant projects and to then report back to the Commission every three to four months on the status of those milestones. The Commission discussed defining core businesses and economic development. CONSENSUS: It was a consensus of the Commission to discuss at the February 9th workshop identifying what are the City's strengths in order to determine the focus for economic development. It was also agreed that a consultant would not be utilized for that purpose. The Commission discussed the annual "to do" list with Mr. Berg explaining that is part of the City's Strategic Plan which is prepared for a two-year period. He indicated that all but two items from the previous Strategic Plan have been completed. Mr. Berg reviewed the House Rules - Code of Conduct with the Commission discussing the difficulties in "agree to disagree" and then moving on. No changes were recommended for the Code of Conduct. Mr. Berg then reviewed the Commission's Success Statement for 2013. The Commission discussed not giving implied directives to staff through questions or comments and how to handle issues brought up under "Audience to be Heard". CONSENSUS: It was a consensus of the Commission for the City Manager to follow-up with the Commission during the "Comments" portion of the agenda to determine how to handle issues brought up under "Audience to be Heard". It was also agreed for the Mayor to try and consistently limit speakers to three minutes. The Commission discussed the handling of agenda items and how to reduce the number of items being brought to the Commission for approval. City of Eustis, Florida Page 1 Printed on 21512013 City Commission Workshop Meeting Minutes - Final January 31, 2013 CONSENSUS: It was a consensus of the Commission that if an item comes to the Commission on the agenda that the Commission believes staff could have handled, the Commission will inform the City Manager following the meeting to provide direction for future similar items. The Commission discussed the number of times the Commission meets each month and the possibility of reducing the number of legislative meetings while possibly increasing the number of workshops to allow more general discussion on issues. CONSENSUS: It was a consensus of the Commission for staff to research whether or not it is feasible for the Commission to only hold one legislative meeting per month and the effect on the approval of ordinances and similar City business. II. BREAK FOR DINNER- RECESS: 5:30 p.m. RECONVENE: 5:55 p.m. Review of Commission Protocols - Continued Mr. Berg reviewed the Commission Protocols with the following clarifications or recommended changes by the Commission: 1) The Commission will contact the City Manager to request research on a specific topic. If a specific staff member has information, the City Manager will direct them to call the Commissioner; 2) Urgent Information - Vice Mayor Bob requested that she be contacted first on her cell phone and Mayor Muenzmay requested that his home number be omitted; 3) City Manager will inform the Commission anytime he will be out-of-town and who has been placed in charge during his absence; 4) Commissioners appointed as liaisons to other boards/committees will provide a verbal report at the next available Commission meeting and then provide to all of the Commissioners copies of the board/committee minutes once they are available; and 5) Any time one of the City's affiliated organizations is to give a report to the Commission, it will be placed on the agenda and not given under ''Audience to be Heard". III. REVIEW RECURRING DEFICIT STATUS 13021 Review Recurring Deficit Status Mr. Berg reviewed the projected General Fund deficit between recurring revenues and recurring expenditures. He explained that the unaudited year-end review revealed a decrease in the budgeted expenditures in the amount of $650, 195 and an increase over the budgeted revenues of $333, 189 for an estimated surplus totaling $953,525. He stated that staff analyzed the savings and revenues to determine what part of those could have an effect on the recurring revenues and expenditures. He stated that the savings from Personnel expenditures would not be recurring but that $100,000 in operating expenditure reductions are recurring and could be used to offset the deficit. He noted the increase in property tax revenues and explained that the City has historically only budgeted 95% of the anticipated property tax revenue; however, at worst case the City can expect to collect 96%. Jim Myers, Finance Director, provided the ad valorem collection percentages from 2008 through 2011 as follows: 2008-96.8%, 2009-97.5%, 2010-97.1% and 2011-96.9%. The Commission discussed the percentage of ad valorem taxes to include in the budget, the amount of License and Permits revenue to include, waiting to make the determination until the City has a six to eight month history of current year receipts, and whether or not the City's accounting software could provide a comparison of rolling 12-month figures. Mr. Berg reviewed the estimated recurring revenue/expenditure deficit for 2012- 13, 2013-14 and 2014-15, noting that the estimated deficit for 2012-13 has been reduced from the previous estimate of $571 ,000 to an estimated $343,000. He explained the following facts for the estimates: 1) They do not include any predictions for inflation, personnel compensation increases or revenue growth; 2) Bond payments for 2014-15 are already set aside; 3) Any changes based on the upcoming pension and benefit studies are not included; and 4) The 90-day Reserves are retained with an additional $1 .000.000 reserved. City of Eustis, Florida Page2 Printed on 21512013 City Commission Workshop Meeting Minutes - Final January 31, 2013 Mr. Berg then reviewed the budget goals as follows: 1) Eliminate the recurring deficit no later than 913012015; and 2) Keep recurring expenditures within recurring revenues. He noted the following issues to be considered: 1) Pension study and evaluation; 2) Benefits study and evaluation; 3) Inflation; 4) Potential for declining property values: 5) Potential for more mandates from the state and federal government; 6) Potential for increasing service demands; and 7) Need for competitive compensation levels for City employees. The Commission discussed the need to evaluate City operations, how well individual employees function, the need to utilize a merit increase system versus across the board pay increases, use of a compensation statement, identifying the appropriate market for salary comparisons and the need to agree on a target within the median for salary levels. Mr. Berg noted that the City has used a merit system in the past and it is already in place. He noted that the standards probably need to be revised and employees need to be informed as to what they would be held to prior to re-implementation of the merit system. The Commission further discussed the cost of living, there being no raises for City employees for the past five years, the recent increase in payroll taxes, City compensation levels being below market rate, and how employee input on a merit system could best be obtained. IV. DISCUSS BUDGET PREPARATION SURVEY & PRIORITIES 13022 Discuss Budget Preparation Survey and Priorities The Commission reviewed their individual responses to each of the budget survey questions. Each question was posed under the following three scenarios: A - Same millage rate with no increase or decrease in revenue; B - Land value declines with same millage resulting in less revenue; and C - Increase in population and land value with current millage resulting in increased revenue. The questions and resulting responses were as follows: 1) Would you want to consider a budget option that increases the current millage rate to cover the current and future gap between revenues and expenditures: Three Commissioners indicated they would consider the roll-back rate in all three scenarios. One indicated they would consider covering 75% of the gap this year with a millage increase and 25% of the gap next year. One indicated "maybe" they would still use an increase in millage rate to cover the gap in funding- even in a situation where there were increases in property values or other revenues. 2) Would you want to consider an increase in user fees for children's and/or adult recreation programs? All of the Commissioners indicated they would raise user fees for children and adult programs if the current rate is too low. 3) Would you want to consider increases in development submittal and review fees? Three were opposed to increasing these fees under all three scenarios. Two would consider increasing the fees under Scenarios A and C. 4) Would you want to consider increasing facility rental fees and other user charges? One indicated support for raising fees under all three scenarios up to 70% of the market rate (including commercial competitors). Three indicated support for increasing to market rate under Scenarios A and B. One indicated support to market rate under Scenarios Band C and one indicated "maybe" under Scenario C. All indicated they did not want to have the City facilities priced out of the market. 5) Would you want to consider a budget option that increases the current millage rate to cover the gap between revenue and expenditures? Five indicated they would consider increasing the current millage to cover the gap under Scenarios A and B and four supported raising the millage rate under Scenario C. One was a "maybe" for increasing the millage rate under Scenario C. 6) Would you want the proposed budget to maintain all current employee positions? Four supported maintaining all currently budgeted positions under all three scenarios and one opposed maintaining all ppsitions under all three scenarios. All Commissioners agreed that the City has already eliminated City of Eustis, Florida Page3 Printed on 21512013 City Commission Workshop Meeting Minutes - Final January 31 , 2013 50 positions and needs to continue to weed out low performing employees while maintaining the quality of service. 7) Would you want to consider a budget option that includes some reduction of workforce to reduce expenditures? Three did not support further staff reductions under all scenarios. One did not support any further reductions under Scenarios A and C but said "maybe " under Scenario B. One supported further reductions under all scenarios. All agreed that low performers need to be addressed. 8) Would you want to consider a budget option that includes salary/benefit increases for employees? Four supported salary or benefit increases under all three scenarios. One said "maybe" under all three scenarios. All agreed that merit and performance plans must be re-enacted and communicated to the employees with supervisors trained in their proper use. 9) Would you want to consider a budget option that reduces current expenditures and/or cost increases by reducing employee benefits? One supported reducing expenses for benefits and four opposed under all three scenarios. Discussion was held regarding the need for employees to share in costs and for benefits to be capped and predictable in order to better control costs. 10) Would you want to consider a budget option that maintains current pay levels, but includes a benefit of reduced work hours (37.5 hr. per week) or days off (birthday or days at the end of the year) as a substitute for a pay increase? Under all three scenarios, four opposed reducing work week hours or providing additional time off in lieu of pay increases and one indicated maybe. Discussion was held regarding the need to not affect service levels. V. CONFIRM DIRECTION TO STAFF TO RESOLVE DEFICIT The Commission discussed the benefits of the workshop format and the advantages and disadvantages of the offsite location. CONSENSUS: It was a consensus of the Commission to carry forward to the February 9th workshop the discussion on the Penny Sales Tax and Gas Tax revenues and expenditures. CONSENSUS: It was a consensus of the Commission to move the location for the February 9th workshop to the Eustis Memorial Library conference room. VI. Adjournment - 8:12 p.m. City Clerk Mayor/Commissioner •These minutes reflect the actions taken and portions of the discussion during the meeting. Please note that due to the workshop nature and remote location of the meeting, there is no audio or video recording of this meeting avai lable. City of Eustis, Florida Page4 Printed on 21512013