Finance Committee

City of Oconomowoc Finance Committee Aldermen: Mulder, Chairman / Schellpeper, Secy / Spiegelberg Tuesday, March 07, 2023 - 5:50 PM City Hall - Conference Room 3 174 E. Wisconsin Ave. Oconomowoc, WI 53066 Notice: If a person with a disability requires that the meeting be accessible or that materials at the meeting be in accessible format, call the City Clerk at least 48 hours prior to the meeting to request adequate accommodations. Tel: (262) 569-2186. 1. Call to order and confirmation of appropriate meeting notification 2. Committee Business a. Consider/recommend Resolution 23-R3105 Approving Budget Amendments to the 2023 Budget for Continuing Appropriations b. Consider/recommend Resolution 23-R3106 Approving Budget Amendments to the 2022 Tax Increment Financing District #7 Budget c. Consider/recommend Resolution 23-R3108 Authorizing the Use of ARPA Funds for Full Lead Service Line Replacements 3. Adjourn ________________________________ Diane Coenen, City Clerk City of Oconomowoc Notice is hereby given that a majority of the Common Council will be present at the above scheduled meeting to gather information about a subject over which they have decision-making responsibility. This constitutes a meeting of the Common Council pursuant to State ex rel. Badke v. Greendale Village Board, 173Wis. 2d 553, 494 N.W. 2d 408 (1993) and must be noticed as such, although the Common Council will not take any formal action at this meeting. 1  MEMORANDUM FINANCE DEPARTMENT Date: March 7, 2023 To: Finance Committee, Common Council and Mayor Magnus From: Laurie Sullivan-Murray, Finance Director Re: 2022 Continuing Appropriations Budget Amendment RELATES TO THE STRATEGIC PLAN Strategic Goal- N/A BACKGROUND Each year as part of our annual closing process, the Finance Committee reviews and makes a recommendation for continuing appropriations. A continuing appropriation transfers the budget and spending authority from one year to another. ADDITIONAL ANALYSIS The requests before you this evening are to carryover funds from 2022 to 2023. These items range from unfinished/uncompleted projects, to unpaid amounts on purchase orders, and specific requests for funding. Attached is a resolution summarizing the account number, original 2023 budget, carryover dollar request, and amended 2023 budget amount after the continuing appropriation. Following the resolution is a narrative document providing a brief description of each item. FINANCIAL IMPACT This resolution will transfer the budget authority from 2022 to 2023 for the specified budget line items. In addition, this resolution designates fund balance in the amount of $15,000 for the future maintenance of the Community Center, $51,500 for street trees as part of development agreements for the street tree ordinance, $1,324 for K9 Donations, $10,000 for Police housing and meals fund, $500 Rotary Scholarship fund, and $8,920 for the Lake Country Pickleball maintenance fund. RECOMMENDATION Staff recommends approval of the attached resolution. SUGGESTED MOTION Recommend the adoption of the Resolution Approving Amendments to the 2022 Budget and the 2023 Budget for Continuing Appropriations. 1 2  RESOLUTION NO. 23-R3105 APPROVING AMENDMENTS TO THE 2023 BUDGET FOR CONTINUING APPROPRIATIONS WHEREAS, the Common Council of the City of Oconomowoc approved the appropriation of funds for municipal and utility operations and capital expenditures; and WHEREAS, on March 7th, 2023, the Finance Committee reviewed the various requests for continuing appropriations. NOW THEREFORE BE IT RESOLVED, by the Common Council of the City of Oconomowoc that the 2023 budget be amended for continuing appropriations and transfers, and fund balance classified as appropriate as follows: 2023 BUDGET AMENDMENT 2023 2022 Carryover Amended Budget Amount Budget POLICE ADMIN CLOTH/TOOL ALLOW 100-503-3100-346 1,800 929 2,729 POLICE OPS CLOTH/TOOL ALLOW 100-503-3300-346 14,400 4,485 18,885 POLICE OPS OPER SUP/EXP 100-503-3300-340 34,365 10,789 45,154 POLICE OPS DRUG INTERVENTION 100-503-3300-360 3,500 3,058 6,558 POLICE TRAIN TRAIN/TRAVEL 100-503-3400-330 20,000 6,897 26,897 SNOW & ICE OPER SUP/EXP 100-505-5325-340 175,725 100,000 275,725 STREET SIGNS OUTSD SVCS NON-IT 100-505-5330-210 65,000 17,970 82,970 DAM MAINT RPR/MAINT GRNDS 100-505-5410-410 500 4,000 4,500 CITY BLDGS OPER SUP/EXP 100-505-5510-340 11,595 7,000 18,595 PARKS/PLAYGR OPER SUP/EXP 100-507-7410-340 41,200 8,246 49,446 PLANNING OUTSD SVCS NON-IT 100-508-8100-210 - 25,000 25,000 ECON DEV GRANTS 100-509-9100-730 - 58,000 58,000 Total Fund 100 246,374 RIVER EQIP GRANTS 213-576-3724-730 315,000 20,982 335,982 Total Fund 213 20,982 PARK FAC CAPITAL IMPRV 223-507-7410-820 290,000 982,492 1,272,492 Total Fund 223 982,492 PARKS/PLAYGR CAPITAL IMPRV 230-507-7410-820 - 24,502 24,502 Total Fund 230 24,502 POLICE ADMIN CAPITAL EQUIP 231-503-3100-810 - 9,283 9,283 Total Fund 231 9,283 PARKS/PLAYGR OUTSD SVC NON-IT 405-507-7410-210 - 200,000 200,000 Total Fund 405 200,000 POLICE OPS CAPITAL EQUIP 408-503-3300-810 - 145,101 145,101 POLICE OPS CAPITAL VEH 408-503-3300-811 122,000 95,480 217,480 STREET CONST OUTSD SVCS NON-IT 408-505-5300-210 57,200 103,015 160,215 STREET CONST CAPITAL IMPRV 408-505-5300-820 2,000,000 149,400 2,149,400 CITY BLDGS CAPITAL IMPRV 408-505-5510-820 150,000 266,486 416,486 COMM CENTER CAPITAL IMPRV 408-507-7210-820 - 56,325 56,325 PARKS/PLAYGR OUTSD SVCS NON-IT 408-507-7410-210 - 32,737 32,737 PARKS/PLAYGR CAPITAL EQUIP 408-507-7410-810 65,000 85,000 150,000 PARKS/PLAYGR CAPITAL IMPRV 408-507-7410-820 445,000 322,077 767,077 ATHLETIC FLDS CAPITAL IMPRV 408-507-7420-820 - 33,500 33,500 Total Fund 408 1,289,121 3 ADMIN & GEN OUTSD SVCS NON-IT 601-518-3850-210 175,250 35,000 210,250 GEN PLANT MAINT RPR/MAINT BLDG 601-576-3703-400 15,000 39,000 54,000 CAPITAL PROJECT OUTSD SVCS NON-IT 601-573-7000-210 20,000 47,710 67,710 CAPITAL PROJECT CAPITAL EQUIP 601-573-7000-810 8,394,000 4,321,363 12,715,363 Total Fund 601 4,443,073 RES&STDP MAINT O/S SVC NON-IT 602-573-6672-210 11,000 35,000 46,000 HYDRANT MAINT OUTSD SVC NON-IT 602-573-6677-210 52,000 50,000 102,000 CAPITAL PROJECT OUTSD SVC NON-IT 602-573-7000-210 - 100,910 100,910 CAPITAL PROJECT CAPITAL EQUIP 602-573-7000-810 5,229,243 2,999,373 8,228,616 Total Fund 602 3,185,283 OUTSIDE SVCS OUTSD SVCS NON-IT 603-518-9923-210 86,500 62,891 149,391 SUBST MAINT RPR/MAINT EQUIP 603-573-6592-435 26,350 20,750 47,100 CAPITAL PROJECT CAPITAL EQUIP 603-573-7000-810 5,484,657 2,204,651 7,689,308 CAPITAL PROJECT CAPITAL VEH 603-573-7000-811 - 45,000 45,000 Total Fund 603 2,333,292 TECHNOLOGY OPER SUP/EXP 700-579-1450-340 59,675 39,000 98,675 Total Fund 700 39,000 Total All Funds 12,773,402 Fund Balance Assignment ASSIGNED FUND BALANCE 100-36401 87,244 BE IT FURTHER RESOLVED that the City Clerk is hereby authorized and directed to publish a copy of this Resolution as a Class I Notice within ten days of the adoption of this resolution in accordance with Section 65.90(5)(a) Wisconsin Statutes. DATED: _______________________________ CITY OF OCONOMOWOC ATTEST: By: Diane Coenen, City Clerk Robert P. Magnus, Mayor 4  City of Oconomowoc Background Information on Continuing Appropriations (Carryovers) December 31, 2022 Police – Admin Cloth/Tool Allow ($929): Each officer is allowed to carry over a maximum of one year’s allowance. Police – Operations Cloth/Tool Allow ($4,485): Each officer is allowed to carry over a maximum of one year’s allowance. Police – Operations Operating Supplies/Expenses ($10,789): Replacement of ballistic vests for officers required by department policy and remaining funds for new hire equipment. Vests will be ordered in early 2023 to extend the usability of the vests. Police – Operations Drug Intervention ($3,058): Carryover unspent funds to assist in educational support related to recent drug trends. Police – Training & Travel ($6,897): Supervisor training opportunities in 2023 that were cancelled in 2022 due to Covid. Public Works – Snow and Ice Operating Supplies/Expenses ($100,000): Carryover unspent funds for salt contract. Public Works – Street Signs Outside Services ($17,970): Open purchase order for the epoxy pavement marking program ($12,739) and remaining funds ($5,231). Public Works – Dam Maintenance Repairs/Maintenance ($4,000): Carryover funds for Lac La Belle dam boards purchased in 2022 but not received until 2023. Public Works – City Buildings Operating Supplies/Expenses ($7,000): Carryover unspent funds for ADA door openers. Parks, Recreation & Forestry – Parks/Playgrounds Operating Supplies/Expenses ($8,246): Transfer of remaining funds from the capital improvements fund for skate park maintenance ($888) and donations received for bench plaques and a swing bench ordered in 2022 but not received until 2023 ($7,358). Planning – Outside Professional Services ($25,000): Carryover funds for the historical property inventory and GIS implementation and projects. Economic Development – Grants ($58,000): Carryover and designate excess budgeted façade funds to add to the Major Façade Fund as identified in City Strategic Plan (Item III A 10). Watershed – River Equipment Grants ($20,982): Lac La Belle Golf Course improvements project was not completed in 2022. Park Facility Impact Fee – Capital Improvements ($982,492): Carryover remaining funds budgeted for the Village Green Restrooms ($284,232) and Northeast Regional Park Tree Planting ($19,800). Open purchase order for the Northeast Regional Park Restrooms and Shelter ($678,460). Chapman Park – Capital Improvements ($24,502): Carryover remaining donated funds for park improvements. Police Equipment – Capital Equipment ($9,283): Carryover remaining donated funds for fitness room equipment. Tax Incremental District #5 – Parks/Playgrounds Outside Services ($200,000): Carryover funds for City Beach Boat Launch Design/Engineering to be completed in 2023. Capital Projects – Police Operations Capital Equipment ($145,101): Open purchase order for squad video/body worn cameras ($136,855) and remaining funds for squad rifles and training equipment ($8,246). Capital Projects – Police Operations Capital Vehicle ($95,480): Open purchase order for squad car replacements ($79,938) and remaining funds for squad change overs ($15,542). Capital Projects – Street Construction Outside Services ($103,015): Open purchase orders for 2022 streets design engineering ($25,913), 2022 construction management ($3,477) and 2023 streets design engineering ($73,625). Capital Projects – Street Construction Capital Improvements ($149,400): Carryover funds for the Highway 67 Pedestrian Underpass ($149,400). Capital Projects – City Buildings Capital Improvements ($266,486): Carryover of budgeted funds for various city building projects delayed due to movement of the police department. Y:\Financial Statements\2021\Year End\Reconciliation & Support\Carryovers\Carryover 2021 Background For Council.docx 5 Capital Projects – Community Center Capital Improvements ($56,325): Open purchase order for the Community Center railings replacements ($53,825) and remaining funding ($2,500). Capital Projects – Parks/Playgrounds Outside Services ($32,737): Open purchase order ($19,000) and remaining donated funds ($250) for the Splash Pad design and remaining budgeted funds for Rockwell Phase 1 Construction Management ($13,487). Capital Projects – Parks/Playgrounds Capital Equipment ($85,000): Open purchase order ($83,863) and remaining budgeted funds ($1,137) for the wide area mower replacement. Capital Projects – Parks/Playgrounds Capital Improvements ($322,077): Open purchase order ($292,077) and remaining budgeted funds ($30,000) for Rockwell Park Phase 1 Construction. Capital Projects – Athletic Fields Capital Improvements ($33,500): Carryover funds for the Champion Fields Concessions and Restrooms not completed in 2022. Wastewater – Admin & General Outside Services ($35,000): Carryover funds for West side flow study that was not completed in 2022. Wastewater – General Plant Operations Repair & Maintenance of Buildings ($39,000): Carryover funds for epoxy floor sealing that was not completed in 2022. Wastewater – Work Order Clearing Outside Services ($47,710): Open purchase orders for a SCADA upgrade ($5,000), 2022 streets design engineering ($2,043), Northeast lift station construction management ($40,667). Wastewater – Work Order Clearing Capital Equipment ($4,321,363): Carryover funds for open work orders including primary digester improvements ($528,484), secondary digester design ($7,047), GIS system ($19,791), secondary digester construction ($2,726,162), disc filter replacements ($136,429), Northeast lift station ($903,450). Water – Reservoir & Standpipe Maintenance Outside Services ($35,000): Carryover funds for reservoir needs study at Wells #4 and #6. Water – Hydrant Maintenance Outside Services ($50,000): Carryover funds for hydrant repainting. Water – Work Order Clearing Outside Services ($110,910): Carryover funds open work orders for Well #8 construction administration ($55,313) and Well #8 drilling ($43,969), and open purchase orders for the streets design engineering ($1,628). Water – Work Order Clearing Capital Equipment ($2,999,373): Carryover funds for Well #8 Pump Station Design ($17,986), Well #8 Pump Station and Reservoir ($2,225,000), and Well #8 continuing construction ($756,387). Electric – Materials and Supplies ($98,234): Carryover Various open purchase orders for electric and street light inventory. Electric – Outside Professional Services ($62,891): Carryover open purchase order for an electric & fiber system study. Electric – Substation Maintenance & Repair of Equipment ($20,750): Carryover open purchase order for a nitrogen generator at a substation. Electric – Work Order Clearing Capital Equipment ($2,204,651): Carryover funds for various capital projects including; Second Street industrial service rehabilitation ($161,094), Jefferson Substation Circuit 203-204 Conversion ($150,000), Southwood Drive annexation ($346,457), Pabst Farms Distribution Looping ($231,648), replacement of remaining CB72 in West industrial area ($500,000), Cable Replacement – Orchard area ($324,392), Overhead to Underground Conversions ($76,432), open purchase orders for transformer purchases ($394,628), and a Vermeer Reel Trailer ($20,000). Electric – Work Order Clearing Vehicles ($45,000): Carryover funds for an electric Ford F-150 Lightning Pickup Truck. Technology – Operating Supplies/Expenses ($39,000): Carryover lifecycle replacements for desktops, laptops and upgrade components not deployed in 2022. General Fund Assigned Fund Balance ($87,244): Designation of funds budgeted to accumulate the reserve for K9 funding based on donations received ($1,324), Police housing & meal fund ($10,000), future capital improvements or repairs for the Community Center ($15,000), designation of funds received for street trees as part of development agreements for the street tree ordinance ($51,500), Rotary scholarship fund ($500) and Lake Country Pickleball maintenance fund ($8,920). Y:\Financial Statements\2021\Year End\Reconciliation & Support\Carryovers\Carryover 2021 Background For Council.docx 6  MEMORANDUM FINANCE DEPARTMENT Date: March 1, 2023 To: City Council, Mayor Magnus From: Laurie Sullivan-Murray, Finance Director Re: Resolution 23-R3106 Authorizing a Budget Amendment for 2022 activity in TIF #7 RELATES TO THE STRATEGIC PLAN Strategic Goal-N/A BACKGROUND TIF districts follow a project plan that includes a budget for all projects within the District. TIF #7, the Olympia Fields district, has had substantial development throughout 2022 and has issued long term debt. Finance Department recommends budget amendment that trues up the revenues and expenses for the year for the district. ADDITIONAL ANALYSIS The Finance Department prepares an annual report for each TIF District and distributes to the Joint Board of Review at the annual meeting. This report is also available on the City’s website. FINANCIAL IMPACT N/A RECOMMENDATION A 2022 budget amendment to reflect the current year activity is recommended for TIF District #7. SUGGESTED MOTION Motion to adopt Resolution 23-R3106 Authorizing an Amendment for 2022 activity in TIF #7. 1 7  RESOLUTION NO. 23-R3106 APPROVING AMENDMENTS TO THE 2022 TAX INCREMENT FINANCING DISTRICT #7 BUDGET WHEREAS,TIF 7 issued long-term debt had substantial development throughout the year, and; WHEREAS, a budget entry is recommended to establish a 2022 amended budget based on current year activity, and; NOW THEREFORE BE IT RESOLVED, by the Common Council of the City of Oconomowoc that the 2022 TIF #7 budget be amended to account for current year activity as shown below. REVENUE Account Number Account Name Original Budget 2022 Activity Amended Budget 407-408-8110-500 INTEREST ON INVESTMENTS 1,000.00 121,051.52 120,051.52 407-408-8430-500 PURCHASING CARD REBATE - 45.12 45.12 407-409-9110-500 LONG TERM DEBT ISSUANCE - 2,735,000.00 2,735,000.00 407-409-9111-580 PREMIUM ON LONG TERM DEBT - 86,290.50 86,290.50 TOTAL REVENUE 1,000.00 2,942,387.14 2,941,387.14 EXPENDITURES Account Number Account Name Original Budget 2022 Activity Amended Budget 407-500-0300-326 CITY ADMIN PUBLICITY - 118.18 118.18 407-500-0300-825 CITY ADMIN LAND - 13.86 13.86 407-500-0400-210 LEGAL OUTSD SVCS NON-IT - 29,606.80 29,606.80 407-501-1100-210 GEN ACCTG OUTSD SVCS NON-IT 150.00 7,950.00 7,800.00 407-505-5300-210 STREET CONST OUTSD SCVS NON-IT - 655,094.37 655,094.37 407-505-5300-820 STREET CONST CAPITAL IMPRV - 3,329,080.60 3,329,080.60 407-505-5350-820 STORM SEWER CAPITAL IMPRV - 1,223,042.25 1,223,042.25 407-530-3322-820 SANITARY SEWER CAPITAL IMPRV - 267,099.06 267,099.06 407-530-3333-820 WATER DISTRIB CAPITAL IMPRV - 1,055,312.49 1,055,312.49 407-530-3334-820 ELEC DISTRIB CAPITAL IMPRV - 356,198.00 356,198.00 407-560-6701-831 SITE IMPROVEMENT GRANTS - 752,492.20 752,492.20 407-580-8300-691 DEBT ISSUANCE EXPENSE - 73,525.00 73,525.00 407-590-9230-913 TRANSFER TO DEBT SERVICE 239,457.50 276,053.89 36,596.39 TOTAL EXPENDITURES 239,607.50 8,025,586.70 7,785,979.20 DATED: _______________________________ CITY OF OCONOMOWOC ATTEST: By: Diane Coenen, City Clerk Robert P. Magnus, Mayor 8  MEMORANDUM DEPARTMENT - WATER UTILITY Date: March 7, 2023 To: Mayor Magnus and Common Council From: Scott Osborn P.E. – Water Superintendent Joe Pickart – Utility Manager Re: Consider / Act on Resolution 23-R3108 to Use ARPA Funds for Full (public and private) LSL Replacements RELATES TO THE STRATEGIC PLAN Strategic Goal- I – PROVIDE A SAFE AND SECURE COMMUNITY  I.D.5 – Evaluate the removal of lead water laterals (private and public) BACKGROUND The City of Oconomowoc currently has approximately 800 public and over 900 private side lead water service lines (LSL) serving customers in our water distribution system. Health effects of continued ingestion of lead from drinking water include early childhood development difficulties, kidney and liver issues, early onset dementia, etc. The Utility has again reached out to all Oconomowoc residents with an assumed lead water service line this year with a letter mailed asking for help to confirm the material type of the water service line and provide additional information on grant funding available that helps pay for a portion of the private LSL. The City is currently in year 3 of its Private LSL Replacement Program which has utilized financial assistance from the Wisconsin Department of Natural Resources (WDNR). The City does proactively replace the public side LSL of any water main that is in its’ Annual Street Maintenance Program project and works with the private residents on options to replace their LSL at the same time. Before the grant funding obtained in 2021, very few private side LSL replacements occurred. Starting in 2021, we were able to create a new Private Lead Water Service Line Replacement Program from WDNR grants where we were awarded $800,000 over the last two years to help private residents remove their portion of the LSL. To date, our program has been able to remove 220 private and 145 public LSLs from our system since 2021. ADDITIONAL ANALYSIS Utility staff will provide an update on the status of the 2023 LSL replacement program including the number of potentials, committed, and completed private (and public) replacements. We will also discuss the funding sources in place for this year’s program. 1 9 FINANCIAL IMPACT In 2021 and 2022, the City was able to secure grant funding from the Wisconsin Department of Natural Resources (WDNR) to provide reimbursements directly to pre-qualified contractors for the private side replacement of the lead water service line.  Oconomowoc was awarded $200,000 in 2021 and $600,000 in 2022  To provide residents with a maximum of $3,000 each for their LSL replacement  Also provided supplemental funding opportunities from Ixonia Bank (‘22) & Bank Five Nine (‘23) o 5-Yr loan at 1 ½% interest For 2023, we learned the LSL Replacement Program would have the following changes:  Any unused 2022 grant funding could be only carried over until April 30, 2023  Funding through WDNR grants after April 30, 2023, is unlikely for the City of Oconomowoc  Use of ARPA funds for full (private and public) LSL replacements are acceptable RECOMMENDATION Suggested Motion: Motion to recommend to the Common Council approval for the use of ARPA Funds both the private and public Lead Service Lateral Replacement Program. SUGGESTED MOTION Motion to apdopt Resolution 23-R3108. 2 10  RESOLUTION NO. 23-R3108 AUTHORIZING THE USE OF ARPA FUNDS FOR FULL LEAD SERVICE LINE REPLACEMENTS WHEREAS, the City of Oconomowoc (the “City”) currently has a Private Lead Service Line (LSL) Replacement Program which provides financial assistance to homeowners with a confirmed LSL when using a pre-qualified plumbing contractor to replace it; and WHEREAS, the City estimates there are 800 residents with a LSL on both the private and public side of their water lateral, making them eligible for funding assistance; and WHEREAS, the City must replace any LSL remaining on the public side within 45 days of a private side replacement; and WHEREAS, the City will fund the public side LSL replacement using its current $350,000.00 Utility Budget Account Number 602-573-7000-222006; and WHEREAS, the City may fund up to $3,000.00 per private side LSL replacement when completed at the same time as the public side LSL using their remaining ARPA Funds of $389,815.00. NOW THEREFORE, BE IT HEREBY RESOLVED, appropriate City officials are authorized by and on behalf of the City to execute the use of up to $389,815.00 of ARPA funds to cover the full (private and public side) LSL replacement or to supplement the replacement of the public side LSL in conjunction with a private side LSL replacement through the City’s Private LSL Replacement Program. DATE: March 7, 2023 CITY OF OCONOMOWOC BY: ____________________________ Robert P. Magnus, Mayor ATTEST: Diane Coenen, City Clerk Z:\City Administrator\Council Agenda\Resolution-23-R3108 Revised Use of ARPA Funds for LSL Replacements Final.docx 11