City Council

CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. REGULAR CITY COUNCIL MEETING - CITY HALL - #1 MUNICIPAL DRIVE The City Council of the City of Jacksonville, Arkansas met in regular session on September 6, 2018 at the regular meeting place of the City Council. Councilman Bishop delivered the invocation and Mayor Fletcher led a standing audience in the “Pledge of Allegiance” to the flag. ROLL CALL: City Councilman: Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins answered ROLL CALL. Mayor Fletcher also answered ROLL CALL declaring a quorum. PRESENT TEN (10) ABSENT (0). Others present for the meeting were: City Attorney Robert Bamburg, Public Works Director Jim Oakley, IT Director Scott Rothlisberger, Program and Economic Development Director Robert Price, CDBG Director Theresa Watson, Fire Chief Alan Laughy, Human Resource Director Jill Ross, Finance Director Cheryl Erkel, Parks and Recreation Director Kevin House, Planning Commission Chairman Jim Moore, Planning Commissioner Patrick Thomas, Addie Gibson, Lida Feller, Rick Kron, Bob Johnson, Gerald Clark, Kimberly Lett, Stephanie Friedman, John Donnelly, Gary Sipes, interested citizens, and members of the press. PRESENTATION OF MINUTES: Mayor Fletcher presented the minutes of the regular City Council meeting of August 16, 2018 for approval and/or correction at the next regularly scheduled City Council meeting. APPROVAL AND/OR CORRECTION OF MINUTES: Councilman Ray moved, seconded by Councilman McCleary that the minutes of the regularly scheduled City Council meeting of 19 July 2018 be APPROVED. MOTION CARRIED. CONSENT AGENDA: REGULAR MONTHLY REPORT/ENGINEERING DEPARTMENT Councilman Ray moved, seconded by Councilman McCleary to approve the regular monthly report for August 2018. PERMITS/LICENSE ISSUED INSPECTIONS PERFORMED Building Permits 12 Building Inspections 26 Business Licenses 16 Electrical 30 Plumbing 32 HVACR 20 REGULAR MONTH REPORT/ANIMAL CONTROL Councilman Ray moved, seconded by Councilman McCleary to approve the regular monthly report for August 2018. ADOPTION FEES/FINES $1,670.00 CONTRIBUTIONS 0.00 TOTALS $1,670.00 MOTION CARRIED. ROLL CALL: Councilmen: Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins voted AYE. MOTION CARRIED. 1  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. WATER DEPARTMENT: WASTEWATER DEPARTMENTS: FIRE DEPARTMENT: Presentation regarding EMS Awards Chief Laughy related that annually they compete in the Firefighter/EMS competition, pointing out that for the 5th consecutive year they have placed in the top three positions. He announced that Austin Clevenger, Bobby Tarno, and Payton Sullivan came in third place for the Paramedic competition and second place for Fire/EMS competition. He added their medical doctor, Dr. Darren Flamick was awarded the Medical Director of the Year and Captain Jones was named the EMS Operations Supervisor of the Year. POLICE DEPARTMENT: PRESENTATION: Narcan grant award The item was deferred until Chief Franklin could be present. STREET DEPARTMENT: RESOLUTION 775 (#12-2018) A RESOLUTION EXPRESSING WILLINGNESS OF THE CITY OF JACKSONVILLE, ARKANSAS TO UTILIZE FEDERAL AID SURFACE TRANSPORTATION PROGRAM FUNDS FOR THE ONEIDA STREET BRIDGE REPLACMENT PROJECT; PROVIDINGIN FOR PAYMENT OF THE DESIGN PHASE OF THE PROJECT AND WAIVING COMPETITIVE BIDDING; DECLARING AN EMERGENCY; AND, FOR OTHER PURPOSES. City Attorney Bamburg explained that this Resolution was adopted a few meetings ago but the State has requested a wording change from one place in the Resolution to a different place. Public Works Director Jim Oakley informed the City Council that the Oneida Bridge is on the line between Sherwood, Jacksonville, and Pulaski County. He stated that the Bridge has been declared deficient and has to be replaced. He noted that Sherwood has taken lead on the project, adding that Mayor Fletcher has spoken with Metroplan regarding funding. Mayor Fletcher related that the original grant was $640,000 but that has been increased to $700,000 because of the importance regarding safety and the project is “shovel ready”. Public Works Director Jim Oakley emphasized that the Bridge definitely has to be replaced, noting that it has weight restraints because of safety factors. City Attorney Bamburg stated that competitive bidding is being waved because Sherwood and Pulaski County had already selected an engineering firm to do the design phase. He recalled that the total cost is approximately $120,000 and Jacksonville’s portion is exactly $39,627.33. Mayor Fletcher noted that this had to be expedited in order to meet the time line requirement to get funding help from Metroplan. Councilman Ray moved, seconded by Councilman Bolden to read Resolution 775 (#12-2018). MOTION CARRIED. Whereupon City Attorney Bamburg read the heading of Resolution 775. 2  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. Councilman Ray moved, seconded by Councilman Sansing to approve Resolution 775 (#12-2018) in its entirety. MOTION CARRIED. SANITATION DEPARTMENT: PARKS & RECREATION: PLANNING COMMISSION: GENERAL: a. DISCUSSION lifting the billboard moratorium Mayor Fletcher recognized Mr. T.J. Ashley to address the City Council. Mr. Ashley related that he and his father own a billboard company based out of North Little Rock and are residents of Beebe, Arkansas. He related that they operate in the Central Arkansas area, explaining that he purchased the property, previously owned by Fred West, located north of Jacksonville. He pointed out that it was part of the property that was annexed in 2011, consisting of approximately 16 acres. He noted that only 4 to 5 of the acres are buildable, relating that the remaining property is located in the Floodway. He stated that according to the Jacksonville Code, they could construct one billboard on this property, but it would require that the moratorium on billboard be lifted. He asked the City Council to consider lifting the moratorium to facilitate their being able to construct one billboard. City Attorney Bamburg responded that in January 2012, the City Council adopted a moratorium on billboards and in the Resolution it was stated that the moratorium would be a minimum of 6 months or until the Arkansas Highway Department finalizes plans for modifications to Hwy. 67/167. He added that the billboard moratorium was specifically for the 67/157 corridor. He stated that while the first phase of the Highway modifications and development, the Highway Department is yet to approve the plans for the central phase of highway modification and expansion through the heart of Jacksonville and despite the calendar that the Highway Department setup themselves, they are far behind that. He continued saying that the Highway Department has not even provided the preliminary drawings that they finalized to Water, Sewer, or any other utility at this stage; because they are still making changes. He related that the City Council has the authority to change any part of the moratorium. Councilman Traylor questioned if the City Council could stipulate that any change could be for the phase that is completed but would stay in affect for the remainder. Councilman McCleary questioned if there would need to be a time limit placed on any changes. City Attorney Bamburg concurred, adding that if the City Council could impose a time limit or address each request on a case by case basis. 3  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. Councilman Sansing stated that since there is a moratorium until the State finished what it is going to do for Hwy. 67/167, he does not see a reason to change it at this time. He noted that the State Highway Department likes to put in change orders at the last minute, adding that until some things are more clarified, he does not support any change to the moratorium. Councilman Bolden asked Mr. Ashley when he wanted to begin construction on the billboard. Mr. Ashley related that the property would first have to be rezoned, noting that the property has been zoned residential for a long time. He stated that he would like to rezone the property to light industrial or commercial. He reiterated that only 4 to 5 acres are buildable, pointing out that the property backs up to the Holland Bottom Farms. He stated that his plan is to begin the process to rezone the property immediately. In response to a question from Councilman Collins, Mr. Ashley related that according to the billboard regulations his placement would have to be 2,000 feet from another billboard on the same side of the roadway and 500’ from a perpendicular line to the right-of-way on the other side of the roadway. He noted that the proposed placement of his billboard does meet those requirements. Councilman Ray stated that his recommendation would be that until the Highway Department finished the north corridor, he would not recommend any change to the moratorium. Councilman Bolden concurred. Councilman Traylor stated that could be Councilman Ray’s recommendation but if someone wants to bring it to the City Council, we still could entertain that. Councilman Bolden agreed, saying that once the property is rezoned we can go from there. Councilman McCleary confirmed what City Attorney Bamburg had stated, that it could be addressed on a case by case basis. Mayor Fletcher stated that a case by case basis sort of defeats the moratorium. City Attorney Bamburg stated that unless the moratorium is lifted it couldn’t be done on a case by case basis. He explained that the City Council would have to modify the moratorium to address any potential billboard location on along the north corridor. Councilman Elliott stated that the City Council would have to look at modifying the moratorium for the part that is completed and leave it for the unfinished area. 4  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. City Attorney Bamburg reiterated that any modification or no modification is up to the determination of the City Council but a petition for a billboard in that location at present is not allowable. In response to a question from Councilman Bolden, City Attorney Bamburg stated that the moratorium was established in Resolution 675, adding that it is available on the City website. Councilman Bolden stated that he feels this needs to be further investigated, pointing out that if Mr. Ashley has a vision for his property on a major Interstate, the City Council needs to support this. b. 2017 Audit by McAllister & Associates Gerald Clark of McAllister & Associates stated it is privilege tonight to present the Comprehensive Annual Financial Report (“CAFR”) for the City of Jacksonville for the year ended December 31, 2017. He stated that he would be presenting the highlights from that report, noting that the report is actually being printed, bound and distributed in the next few days. He referenced three handouts, saying that one is the Independent Auditor’s Communication with those charged with governance. He stated that in that report they are required by accounting standards to communicate to the City Council. Secondly, there is an Audit Management letter in which we have noted 3 instances where we feel like internal controls need to be strengthened and our recommendations for doing so. He then noted the third handout is an Executive Summary. Calendar year 2017 marks the 21th consecutive year that the City has prepared a Comprehensive Annual Financial Report. The report was prepared by the City’s Finance Department. It contains financial statements audited by the City’s auditing firm, McAlister & Associates, P.A., CPAs, and also pertinent financial, economic, demographic, and statistical information related to the City of Jacksonville over a ten-year period. The purpose of the report is to provide the City’s elected officials, citizens, bondholders and other interested parties with detailed information concerning the City’s operations and financial position. Each year since 1997 and including the 2016 report, the City’s CAFR has received the Certificate of Excellence in Financial Reporting awarded by the Government Finance Officers Association of the United States and Canada (GFOA). The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government financial reports. The 2017 Comprehensive Annual Financial Report has also been submitted to GFOA for award consideration. 5  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. Independent Audit The City is responsible for the accuracy, completeness and fairness of the data presented in the CAFR. The report is prepared by the City’s Finance Department in accordance with standards prescribed by the Governmental Accounting Standards Board (GASB), the Government Financial Officers Association of the United States and Canada (GFOA) and other rule-making bodies. The City is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements. Our responsibility as auditors is to conduct the audit in accordance with generally accepted auditing standards and government auditing standards; to express an opinion on the City’s financial statements; and to gather sufficient evidence to provide a basis for our audit opinions. Based upon our audit, we have rendered a “clean”, or unmodified opinion on the City’s financial statements for the year ended December 31, 2017. An unmodified opinion means that, in our opinion, the financial statements have been prepared using accounting principles generally accepted in the United States of America (GAAP), do not contain material misstatements, and are fairly presented. Our Independent Auditor’s Report is presented on page 11 of the CAFR. Management Letter We have issued a formal management letter, included with the annual report, which is a customary by-product of the audit process and is intended to provide management with suggestions and guidance in the ongoing effort to improve internal controls. The management letter contains three comments related to the 2017 audit. FINANCIAL HIGHLIGHTS The following are financial highlights of the 2017 report:  The first two financial statements in the CAFR on pages 26 through 29 are referred to as the government-wide financial statements. These statements include all funds of the City, with the exception of the Police and Fire pension trust funds. They also include the financial statements of the City’s component units which are the Water, Wastewater and A&P Commission.  The first of these government-wide financial statements is the Statement of Net Position. This statement is comparable to a balance sheet for a private business enterprise.  The Statement of Net Position presents information on all of the City’s assets and liabilities on a full accrual basis with the difference between the assets and liabilities reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. 6  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M.  The City’s Statement of Net Position indicates total assets of the City were $63M at the end of 2017. Of the total assets, $51M was the City’s investment in capital assets, $4.4M was cash and investments, and $7.6M were accounts receivable and other assets. Total liabilities of the City were $35.2M at the end of 2017. Of this amount, $32.3M were long-term obligations due beyond one year and $2.9M were considered current liabilities due in one year. Total assets exceeded total liabilities by $32.2M at the end of 2017. The amount by which assets exceed liabilities is referred to as the City’s “Net Position”. Net position is essentially composed of three components: the largest of which, for the City, is its investment in capital assets such as land, buildings, infrastructure, and machinery and equipment. This amount at the end of 2017 was $43.7M or 134% of total net position. These capital assets are used to provide services to the community and, as a result, they are not available for future spending. An additional portion of the City’s net position is subject to external restrictions as to how the funds may be used, such as street and grant funds. At the end of 2017, the City’s restricted net position totaled $4.8M or 15% of the total net position of the City. The City’s unrestricted net position at the end of 2017 was a deficit balance of $16.2M. City of Jacksonville Summary Statement of Net Position December 31, 2017 and 2016 City of Jacksonville Net Position Governmental Activities Business-type Activities T otal 2017 2016 2017 2016 2017 2016 Current assets $ 8,065,786 $ 7,693,507 $ 2,455,873 $ 1,815,992 $ 10,521,659 $ 9,509,499 Noncurrent assets 1,236,302 1,387,033 - - 1,236,302 1,387,033 Capital assets 45,650,304 50,277,632 5,284,651 1,820,668 50,934,955 52,098,300 Other assets 281,317 - - - 281,317 - T otal assets 55,233,709 59,358,172 7,740,524 3,636,660 62,974,233 62,994,832 T otal deferred outflows of resources 7,208,142 5,306,984 740,407 535,175 7,948,549 5,842,159 T otal Assets and Deferred Outflows 62,441,853 64,665,156 8,480,931 4,171,835 70,922,782 68,836,991 Current Liabilities 2,279,687 2,541,550 713,634 153,487 2,993,321 2,695,037 Long-term liabilities 30,144,127 29,557,054 2,088,542 1,845,494 32,232,669 31,402,548 T otal liabilities 32,423,814 32,098,604 2,802,176 1,998,981 35,225,990 34,097,585 T otal deferred inflows of resources 2,873,754 600,122 215,251 24,096 3,089,005 624,218 T otal Liabilities and Deferred Inflows 35,297,568 32,698,726 3,017,427 2,023,077 38,314,995 34,721,803 Net Position: Net investment in capital assets 37,788,738 42,125,123 5,284,651 1,820,668 43,073,389 43,945,791 Restricted 4,759,509 4,161,056 - - 4,759,509 4,161,056 Unrestricted (15,403,962) (14,319,749) 178,852 328,090 (15,225,111) (13,991,659) T otal Net Position $ 27,144,285 $ 31,966,430 $ 5,463,502 $ 2,148,758 $ 32,607,787 $ 34,115,190 7  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M.  The second of the government-wide financial statements is the Statement of Activities. This statement is comparable to an income statement for a private business enterprise.  The Statement of Activities presents information showing revenues and expenses on a full accrual basis and how the City’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave)  The Statement of Activities indicates total revenues of the City for 2017 were $26.8M, while total expenses for 2017 were $28.7M. Overall, expenditures exceeded revenues by $1.9M in 2017, resulting in a decrease in the City’s net position for 2017. City of Jacksonville Summary Statement of Change in Net Position December 31, 2017 and 2016 City of Jacksonville Changes in Net Position Governmental Activities Business-type Activities T otal 2017 2016 2017 2016 2017 2016 Re ve nue s Program revenues: Charges for services $ 2,141,027 $ 2,353,228 $ 3,960,037 $ 3,405,200 $ 6,101,064 $ 5,758,428 Operating grants and contributions 4,300,118 4,413,390 15,855 11,947 4,315,974 4,425,337 Capital grants and contributions 111,000 259,177 - - 111,000 259,177 General revenues: Property taxes 821,693 871,178 - - 821,693 871,178 Sales taxes 14,013,579 13,781,154 - - 14,013,579 13,781,154 Franchise taxes 1,096,000 1,105,865 - - 1,096,000 1,105,865 Investment income 110,441 89,570 4,125 1,539 114,566 91,109 Intergovernmental revenues 449,828 451,246 - - 449,828 451,246 Gain/(loss) on sales of capital assets (149,160) 37,520 56 45,250 (149,104) 82,770 Total re ve nue s 22,894,527 23,362,328 3,980,074 3,463,936 26,874,600 26,826,264 Expe nse s General government 3,191,788 3,439,457 - - 3,191,788 3,439,457 Public works 3,134,679 2,987,291 - - 3,134,679 2,987,291 Parks and recreation services 2,875,561 4,109,087 - - 2,875,561 4,109,087 Public safety 14,330,204 16,302,436 - - 14,330,204 16,302,436 Housing and neighborhood programs 216,681 240,454 - - 216,681 240,454 Agent fees on long-term debt 6,990 6,844 - - 6,990 6,844 Interest on long-term debt 242,525 262,728 - - 242,525 262,728 Sanitation services - - 1,575,392 1,516,551 1,575,392 1,516,551 AGFF Shooting Sports Complex 813,554 813,554 - Emergency medical services - - 1,994,625 2,472,158 1,994,625 2,472,158 Total e xpe nse s 23,998,428 27,348,297 4,383,571 3,988,709 28,381,999 31,337,006 Change in net position before transfers (1,103,902) (3,985,969) (403,497) (524,773) (1,507,399) (4,510,742) T ransfers (3,718,243) (434,989) 3,718,243 434,989 - - Change in net position (4,822,144) (4,420,958) 3,314,745 (89,784) (1,507,399) (4,510,742) Net Position, Beginning of Year, as previously reported 31,966,430 36,387,390 2,148,758 2,238,542 34,115,188 38,625,932 Net Position - December 31 $ 27,144,285 $ 31,966,429 $ 5,463,502 $ 2,148,758 $ 32,607,787 $ 34,115,189 8  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M.  Narrowing the focus from the City-wide financial statements to the governmental funds financial statements, these funds include all funds with the exception of the pension trust funds, and the enterprise funds (Sanitation, EMS and the Shooting Complex). Governmental funds are reported on the modified accrual basis of accounting, which combines accrual-basis accounting with cash-basis accounts. Under this method, revenues are recognized when they become available and measurable, generally within 60 days after year-end.  The City’s governmental funds reported total 2017 revenues of $23M, down $307K or 1.3% from 2016. Expenditures of the governmental funds were $22M, down $3.8M or 14.9% from 2016. The net position of these funds increased by approximately $561K during 2017.  Sales tax revenues which account for 61% of all City revenues were just over $14M in 2017. This amount was an increase of $232K or 1.7% over 2016 sales tax revenues. A category called intergovernmental revenues which includes State tax turnbacks and grants is the City’s second largest revenue source. Intergovernmental revenues totaled $4.7M in 2017 which was down slightly from $4.8M in 2016. Utility franchise taxes were $1.1M or just under 5% of total revenues. City of Jacksonville Comparative Statement of Revenues and Expenditures-Governmental Funds Percent Percent of Change 2015 2016 2017 Total Prior Year Revenues Property taxes $ 833,835 $ 839,052 $ 826,251 3.6 % (1.5) % Sales taxes 13,798,792 13,781,154 14,013,579 60.8 1.7 Licenses and permits 136,274 226,274 434,535 1.9 92.0 Intergovernmental 4,575,835 4,847,747 4,738,360 20.6 (2.3) Charges for services 1,150,933 1,097,253 942,439 4.1 (14.1) Fines and fees 651,626 562,916 542,862 2.4 (3.6) Utility franchise taxes 1,262,049 1,105,865 1,096,000 4.8 (0.9) Investment income 15,644 89,570 110,441 0.5 23.3 Miscellaneous 1,437,312 806,294 344,085 1.5 (57.3) Total revenues $ 23,862,300 $ 23,356,125 $ 23,048,552 100.00 % (1.3) % Expenditures General government $ 2,708,248 $ 2,781,035 $ 2,904,825 13.2 % 4.5 % Public works 2,802,715 2,375,150 2,390,959 10.9 0.7 Parks and recreation 3,292,345 3,936,111 2,473,090 11.2 (37.2) Police 7,347,242 7,370,238 6,970,618 31.6 (5.4) Fire 4,472,701 7,214,517 4,764,915 21.6 (34.0) Emergency communications 675,758 699,037 714,326 3.2 2.2 Animal control 287,637 280,536 290,121 1.3 3.4 Housing and neighborhood programs 202,067 226,768 213,718 1.0 (5.8) Debt service 6,784,314 1,004,378 1,308,954 5.9 30.3 Total expenditures $ 28,573,027 $ 25,887,770 $ 22,031,526 100.00 % (14.9) % 9  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M.  The City’s General Fund finished 2017 with a fund balance of $1,001,212 which was an increase of $160,028 from the December 31, 2016 fund balance. This was the first increase in the fund balance of the General Fund since 2012. General Fund revenues of $19,904,000 were $893,000 under budgeted revenues for the year, while General Fund expenditures of $18,413,000 were $1,456,000 under budgeted expenditures for 2017. 2017 General Fund Operations Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues $ 20,796,905 $ 19,904,153 $ (892,752) Expenditures 19,869,587 18,413,136 1,456,451 Expenditures in excess of revenues 927,318 1,491,017 563,699 Other financing sources (uses) Carryover - prior year 80,948 - (80,948) Transfers-in: (From Other Funds) 15,000 - (15,000) Transfers-out (1,023,266) (1,330,989) (307,723) Total other financing sources (uses) (927,318) (1,330,989) (403,671) Net change in fund balances $ - 160,028 $ 160,028 Fund balances, January 1 841,184 Fund balances, December 31 $ 1,001,212  As a measure of the General Fund’s liquidity, it is useful to compare total General Fund fund balance to total General Fund expenditures. The fund balance of $1,001,212 at December 31, 2017 represents approximately 5.4% of 2017 actual General Fund expenditures and approximately 5.0% of 2018 General Fund budgeted expenditures. As a general policy, the City’s minimum target at the end of a fiscal year for the fund balance of the General Fund is 60 days (16%) expenditures based on the most recent completed year. At the end of 2017, the balance on hand was approximately 18 days of 2018 budgeted General Fund expenditures. This was up from 15 days of reserves at the end of 2016. This minimum level of fund balance is required to ensure funds availability for unforeseen emergencies that might impact the City’s ability to pay for basic operations and also to guarantee the payment of debt obligations. 10  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. General Fund Ending Fund Balance as a Percent of Next Year’s General Fund Budgeted Expenditures General Fund Fund Balance % of Budgeted end of Budgeted Year Expenditures Previous Year Expenditures 2008 17,516,497 3,672,742 21.0% 2009 18,888,911 3,552,714 18.8% 2010 18,663,794 3,571,855 19.1% 2011 17,853,061 3,456,369 19.4% 2012 19,190,962 5,404,555 28.2% 2013 20,677,929 4,639,312 22.4% 2014 22,011,653 3,219,851 14.6% 2015 20,657,218 2,435,404 11.8% 2016 21,059,443 1,876,818 8.9% 2017 20,273,419 841,184 4.2% 2018 19,939,044 1,001,212 5.0% $25,000,000 $22,011,653 $20,000,000 $21,059,443 $20,677,929 $20,657,218 $20,273,419 $19,939,044 $18,888,911 $19,190,962 $18,663,794 $17,516,497 $17,853,061 $15,000,000 $10,000,000 $5,000,000 28.2% 22.4% 21.0% 18.8% 19.1% 19.4% 14.6% 11.8% 5.0% $‐ 8.9% 4.2% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 GF Fund Balance % Budgeted Expenditures Conclusion In conclusion, I encourage you to read the Management’s Discussion and Analysis included in the financial section and beginning on page 15, and also the notes to financial statements which begin on page 45. The MD&A analyzes the City’s financial performance for the year, provides comparisons of the current year results to the prior year, and discusses both the positive and negative aspects of the comparison. The notes to the financial statements provide required detailed disclosures and descriptions of the financial statements. 11  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. The preparation of this report would not have been possible without the dedication and committed services of key staff in the City’s Finance Department under the leadership of Finance Director Cheryl Erkel. I would like to express our appreciation to all City staff who assisted us in the audit and whose efforts resulted in a timely and successful completion of this year’s report. Finally, we want to express our appreciation once again to the City and the Council for allowing us the opportunity to serve as the City’s auditors. We very much value our business relationship with the City of Jacksonville. Mayor Fletcher stated that the City can no longer rely on Sales Tax and Intergovernmental Funds along, noting that those represent 82% of the annual revenues. He then noted that Intergovernmental Funds, which is State Turnback, is related to the population; pointing out that Jacksonville lost 1,600 people and have lived with that number. He related that hopefully when the Census comes in two years it will be better. He stated that most cities are in the same situation we are, most of them have passed a sales tax in the last two years, citing Sherwood, North Little Rock, and Benton. He related that we are going to have to come to grips that we need a more stable source of revenue for a foundation. He added that no one likes to talk about it but it is just being responsible, adding that he believes that 2.5 mills would generate about a million dollars which would help shore up the reserves. He further added that it would set aside enough money for Capital Improvement Projects and equipment, offering a more solid foundation. He stated that the City would still rely on Sales Tax but there have been so many factors that have attacked the Sales Tax, obviously one is the Internet Sales Tax, as well as other things. He mentioned the lottery tickets, saying that we are selling 8 to 10 million dollars in lottery tickets that do not go toward consumer goods or products so therefore there is no Sales Tax. He noted that the Casino Amendment is coming up, which is another opportunity to take money out of the merchants and businesses pockets. He stated that cities keep being bombarded, which seems to be the trends of the future, so we will have to do something other than just rely on Sales Tax. Mr. Clark concurred, saying that the City has a real liquidity problem. He stated that while the Sales Tax did increase slightly in 2017, the general trend has been downward not only for that but also for State Tax Turnback. He agreed that the City would have to look for a new revenue source in addition to Sales Tax, saying that he believes some cities have even reached the double digit in Sales Tax rates when combined with the State and County rates. Mayor Fletcher stated that cities are anxious each month waiting for the Sales Tax figures. He added that we do not need to live month to month hoping the Sales Tax will be good. Mr. Clark agreed, saying that the City is going to have a real need for funds regarding Capital Improvements, equipment acquisitions, and drainage projects; that is just not there currently. 12  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. Mayor Fletcher spoke of cuts, saying that there is nothing left to cut without cutting the quality of life. Mr. Clark stated that the City did a good job staying within the budget in 2017. Councilman Collins clarified that Mayor Fletcher had stated that 2.5 mills would produce approximately one million in revenues. Mayor Fletcher concurred, saying that would be a rough estimate. Councilman Ray moved, seconded by Councilman McCleary to accept the Audit report as presented. MOTION CARRIED. c. DISCUSSION Taxis and vehicles for hire Chapter 5.20 Jacksonville Municipal Code Councilman Collins explained that he had spoken to a business owner who had complained that the City code as written was causing him to have to maintain a physical location within the City in order to be able to operate a taxi. He affirmed that the code 5.20.060 dictates such so that the operator can have a landline phone and do basic maintenance on their vehicles. He noted that landline phones are not in use as much as they once were. He then cited 5.20.055 the code requires the posting of fares on the vehicles along with the name and phone number of the business. He pointed out that Uber and Lyft do not have to post that information according to the rules of the companies. He acknowledged that it is a different way of doing business than when the code was adopted. Discussion ensued regarding regulations for taxis versus Uber and Lyft drivers. A subcommittee consisting of Councilmen Collins, Traylor, Bolden, Sansing, and CDBG Director Theresa Watson was formed to research outdated or unnecessary regulations as a result of changed modes of taxis service and vehicles for hire. d. ORDINANCE 1589 (#11-2018) AN ORDINANCE AMENDING ORDINANCE NO. 1532 (#12-2015) AUTHORIZING APPROVAL OF MODIFICATIONS OF EXPENDITURES UNDER THE 2015 BOND ISSUE BY THE CITY OF JACKSONVILLE, ARKANSAS; PRESCRIBING OTHER MATTERS RELATING THERETO; AND, DECLARING AN EMERGENCY Finance Director Cheryl Erkel reminded the City Council that several meetings ago, the City Council voted to reallocate bond monies to purchase an ambulance and other things. She continued saying that the timing of the bond issue in order for the City to have it all allocated is September 15th. She related that they discovered that due to some of the items that they initially wanted to use the bond money for were not able to be done, we had 13  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. extra funds still left on the bond issue. She explained that they went back and we’ve decided that there is enough money there to get another ambulance and some more playground equipment and some more parks equipment, saying that is the purpose of Ordinance 1589. She clarified that this will allocate what is left on bond proceeds. Chief Laughy explained that the Fire Department had four ambulances, and sold the oldest, a 2003 Ford ambulance, for $6,200.00 on GovDeals several months ago. He stated that they do not have a back up ambulance currently. He noted that they have the first ambulance “in the shoot” for $230,000 and this offers us another opportunity to purchase a second ambulance. He stated that they really need three, adding that they could get by with two, adding that it would also provide for a reserve ambulance. Mayor Fletcher clarified with Chief Laughy that the last ambulance was 2011, which is their newest ambulance. Chief Laughy stated that Medic One is a 2011 which has almost 120,000 miles, adding that this is a great opportunity to get a second ambulance to prevent trying to fund this down the road, when we may or may not have the funds. He then related that he would also like to purchase four cardiac monitors. Mayor Fletcher noted that delivery of the previously purchased ambulance should be in the middle of October. In response to a question from Councilman Traylor, Chief Laughy responded that the City has two 2011 ambulances and a 2008. He then concurred that a 2018 is coming. He stated that they need four ambulances, adding that if they purchase another ambulance they can sell the 2008. He stated that the ones they have now regarding “useful life” have run their course, adding that the ones that they are getting would have a useful life of 15 to 16 years. Councilman Traylor concurred with Finance Director Cheryl Erkel that the bond issue is for 15 years. Chief Laughy interjected that he feels they could easily keep the new ambulances easily 15 years adding that he would bet they could be kept for 20 years because as they cycle out they can be moved to reserve. Fire Captain Jones noted that the new ambulance have a Fleetwood springs in the rear, which makes the ride more comfortable and it also helps to extend the life of the box and the unit itself. He addressed the cardiac monitors, saying that they currently have two 2005, a 2010, and a 2011. He stated that these monitors have far exceeded their lifespan. He related that they have tried to apply for the “assistance to Firefighter’s grant” but did not get it. He explained that the monitors they currently have will not be able to be warrantee after this year. He stated that they carry warrantees because they 14  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. are so expensive, noting that other than ambulances, their cost benefit analysis shows that cardiac monitors are the most expensive equipment on an ambulance. He stated that this is equipment we use every day to save lives. He stated that it has been studied and determined that the quicker we can identify a sudden cardiac event that fits certain perimeters and notify the ER the faster they can get to a cath lab and bypass the ER. He stated that this dramatically decreases the fatality rate. He stated that the new monitors would transmit to the ER and the doctor can read it in real time, which is going to be a full requirement in 2019. He added that these monitors meet the American Heart Association standards as well as all other health care standards. He then answered Councilman Collins that each unit is approximately $40,000, adding that the equipment for the old monitors are not compatible with the new monitors so we will also have to purchase the batteries and charges to go with the new monitors. He stated that each unit and accessories is approximately $50,000, adding that they are hoping to replace four units because then they will get a discount and the price drops from $40,000 to approximately $32,816 for the unit without accessories for an overall savings of approximately $32,000. He then added that they would also get a trade-in allowance for the current monitors at $3,500 each equaling approximately $14,000. Mayor Fletcher stated in round figures it would be approximately $240,000 for the ambulance and $145,000 for the cardiac monitors. Captain Jones noted that one down fall of not purchasing would be if one of the present monitors break without being under warrantee, the City would be out that money immediately. He noted that the other part is that you cannot run a paramedic ambulance without a cardiac monitor. Parks and Recreation Director Kevin House reminded the City Council that a year and a half ago they had to pull the playground equipment from Pleasure Park for safety reasons, adding that he is proposing to replace that equipment with approval for a grant that will save approximately 25%. He said that the total price for the equipment at Pleasure Park is going to be $86,011. He then answered Councilman Mashburn, that they were approved for a matching grant of 75/25%. He then added that the grant is based on the equipment not installation. In response to a question from Councilman Traylor, Mayor Fletcher stated that any unused monies goes back, clarifying that it is not assess against the loan. Councilman Traylor clarified that it is money that the City does not have to pay back. 15  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. Finance Director Cheryl Erkel stated that actually what happens is that they have to have it allocated before the 15th but do not have to actually have it spent. She continued saying that by the City Council approving this Ordinance that allocates the funds, she stated that if not and we pass the September 15th date then we have to be limited on how much interest we accrue on the remaining funds that are trust fund at the bank and then we also have to follow some other legal terms to make sure that we are not receiving more income on those funds than what the interest rates that the bonds initially had. She related that she wrote and got approval from Wright Jennings and the trust people who are the bond counsel that gave approval to do it like this. City Attorney Bamburg clarified that you have three years to commit your expenditures, and as Finance Director Cheryl Erkel indicated, if you do not get them apportioned within that three year timeframe, it creates all kinds of problems and basically with some exceptions you lose the ability to use the bond money for the intent purposes for what the City Council planned. He went on to say that if the expenditures had been approved during that time period it would not be a problem, but in these circumstances we were running up on the deadline and there was still some money left available for the Fire Department and Parks because those were part of the original 2015 bond issue purposes. Mayor Fletcher stated that the bottom line is everything being brought before the City Council is items that need to be replaced now or in the near future and if we do not through the bond issue, then somewhere in the budget process it will have to be included. He stated that it makes sense to add these items to the bond issue. Councilman Traylor remarked that the amount requested is $200,000 but the Park equipment is only going to cost $86,000 with the matching grant. He questioned if this means the other $120,000 can be spent anyway at all. Finance Director Cheryl Erkel stated that Parks and Recreation Director House is also looking at some other equipment too in Parks and Recreation. Commission Traylor questioned where this equipment is to be placed. Parks and Recreation Director House answered that he has not gotten a price, adding that he needs a piece of exercise equipment. He then answered Councilman Traylor that the piece of equipment he is replacing is 23 years old. Councilman Traylor reminded that when the City Council approved a bond issue, it needs to be for something that is not only going to last 5 years. Mayor Fletcher interjected that it needs to last the life of the bond. 16  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. City Attorney Bamburg stated that any of the expenditures that are approved that exceed what the appropriate purchase price is, will end up either coming before the City Council for bid approvals or coming before City Council regarding waiving competitive bidding. Councilman Twitty questioned if any of the equipment is special needs compatible. Parks and Recreation Director Kevin House answered that it will not be an inclusive park, adding those are astronomical. He stated that he has worked with a guy and he was supposed to send the new drawing but unfortunately he has not done that. He related that he does not want to say yes, adding that there are transfer platforms, things for children with special needs that can use. He then answered Councilman Twitty that Dupree Parks has some transfer platforms in some areas that are, special needs is such a wide range. Councilman Twitty clarified that she is referring to wheel chair accessibility. Parks and Recreation Director Kevin House stated that the shredded rubber flooring is ADA approved, so yes we do have some, we do not have an inclusive plan, but we do have some that can be used for special needs. Councilman Mashburn related that she understands that the money has to be allocated before the deadline and that both the Fire Department and Parks & Recreation has needs but she questioned when the last time the Police Department was upgraded was. Finance Director Cheryl Erkel stated that the original bond issue did not include the Police Department, adding that the Police Department got a brand new building a few years ago. Mayor Fletcher stated that the main thing right now is police cars, saying that is always something we always do. He noted that the life of a police car would not extend the life of the bond issue. Finance Director Cheryl Erkel noted that police cars are depreciated over 5 years but most of them do not last over 3 years. Mayor Fletcher then noted that 4 new police cars were purchased in 2017. He then answered Councilman Mashburn that the budget process is the typical way to purchase new police cars. Councilman Bolden reminded everyone that a bond is money for a specific task, saying that he wondered that same but then realized the Police Department was not in the bond issue. He then noted that the deadline is basically across the board, even the Federal Government is the same way, if you do not expend your funds you will not get money next time. He stated that it is very 17  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. important that you exhaust a funding as much as possible so that when you apply for a bond again that will not look back and see other monies were not spent. Councilman Sansing moved, seconded by Councilman McCleary to place Ordinance 1589 on FIRST READING. ROLL CALL: Councilman Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins voted AYE. MOTION CARRIED. Whereupon City Attorney Bamburg read the heading of Ordinance 1589. Councilman McCleary moved, seconded by Councilman Sansing to APPROVE Ordinance 1589 on FIRST READING and SUSPEND the rules and place Ordinance 1589 on SECOND READING. ROLL CALL: Councilman Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins voted AYE. MOTION CARRIED. Whereupon City Attorney Bamburg read the heading of Ordinance 1589. Councilman Ray moved, seconded by Councilman Sansing to further suspend the rules and place Ordinance 1589 on THIRD AND FINAL READING. ROLL CALL: Councilman Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins voted AYE. MOTION CARRIED. Whereupon City Attorney Bamburg read the heading of Ordinance 1589. Councilman Sansing moved, seconded by Councilman Ray that Ordinance 1589 be APPROVED AND ADOPTED. ROLL CALL: Councilmen Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins voted AYE. MOTION CARRIED. Councilman Ray moved, seconded by Councilman McCleary that the EMERGENCY CLUSE be approved and adopted. ROLL CALL: Councilmen Elliott, Bolden, McCleary, Sansing, Ray, Mashburn, Traylor, Twitty, Smith, and Collins voted AYE. MOTION CARRIED. ORDINANCE 1589 (#11-2018) APPROVED AND ADOPTED THIS 6th DAY OF SEPTEMBER, 2018. Mayor Fletcher recognized CDBG Director Theresa Watson, explaining that she established a green space in the Sunnyside neighborhood center space in the street without much funds. APPOINTMENTS: PARKS AND RECREATION APPOINTMENTS Mayor Fletcher stated that a lot of the positions had expired, adding that there were problems trying to get quorums to hold meetings. He explained that he and Parks and Recreation Director Kevin House were considering different things, saying that he would like to see a Parks and Tourism Department because it works so closely with the A&P Commission. He stated that Parks and Recreation Director Kevin House had researched “Friends of Parks” which would open the door for more people to get involved in the Parks system. He stated that there had been questions so they decided to go ahead and appoint and reappoint some Commissioners and hopefully keep discussions 18  CITY OF JACKSONVILLE REGULAR CITY COUNCIL MEETING SEPTEMBER 6, 2018 7:00 P.M. – 8:20 P.M. and ideas open about what we can do to better expand not only this Commission but any Commission to broaden the ability to get more public participation. He stated that he feels these Commissions will contribute a lot to the Parks Department. Councilman Ray moved, seconded by Councilman Bolden to approve the appointments of Lauren Martin to fill the unexpired term Cheryl Carpenter for a term to expire 05/09/2021; the appointment of Travis Hooper to fill the unexpired term of John Toombs, Jr. for a term to expire 05/09/2019, the appointment of Laura Walker for a term to expire 05/09/2022; the appointment of Ava Coleman for a term to expire 05/09/2022; and the reappointment of Tony Gordon for a term to expire 05/09/2023. MOTION CARRIED. ANNOUNCMENTS: Bunco Fundraiser for the Senior Wellness and Activity Center Saturday, September 22nd Landmark Baptist Church doors open at 4:30 p.m. EXECUTIVE SESSION: Councilman Twitty moved, seconded by Councilman Smith to retire into Executive Session at approximately 8:06 p.m. MOTION CARRIED. Councilman Collins moved, seconded by Councilman Traylor to reconvene from Executive Session at approximately 8:19. MOTION CARRIED. ADJOURNMENT: Without objection, Mayor Fletcher adjourned the meeting at approximately 8:20 p.m. MOTION CARRIED. Respectfully, ________________________ _________________________ Susan L. Davitt MAYOR GARY FLETCHER City Clerk-Treasurer 19