Board of Mayor & Commissioners

MINUTES OF SPECIAL CALLED SESSION OF THE PIPERTON BOARD OF MAYOR AND COMMISSIONERS June 14, 2022, 7:00 P.M. The Piperton Board of Mayor and Commissioners met in a special called session on June 14, 2022 at 7:00 p.m. at City Hall, with Board members: Mayor Henry Coats, Vice-Mayor Mike Binkley, Commissioner David Crislip and Commissioner Hugh Davis present. Commissioner Preston Trotter was absent. City Manager Steve Steinbach, Fire Chief Reed Bullock, Finance Director Maria George, and City Recorder Beverly Holloway were present. Vicki Hancock, Beth Gallagher, Lt. Adam Hursh, Firefighter Brad Woodward, Officer Spurlock, et al were present in the audience. Agenda item 1. Call to order, establish quorum Action taken: Mayor Henry Coats called the meeting to order at 6:00 p.m., and established that a quorum was present. Agenda item 2. Prayer and Pledge of Allegiance to the American Flag Action taken: Fire Chief Reed Bullock led in the opening Prayer and Mayor Coats led in the Pledge of Allegiance to the American Flag. Agenda item 3. First Reading, Ordinance No. 358-22, amending the Budget for FY 2021-2022, (Third Amendment) Mr. Steinbach stated tonight in the special called meeting we are here to consider the third and final budget amendment for FY2022 as well as the proposed budget for FY 23, these are first readings and the public hearing will be on the 28th, with regards to Ordinance No. 358- 22-amending the budget, these are the exhibits associated with the General Fund (Exhibit A), Water Fund (Exhibit B), Sewer Fund (Exhibit C), Special Revenue Fund (Street Aid-Exhibit D) and Special Revenue Fund (Sanitation-Exhibit E), we recognize revenue that has exceeded projections in this third budget amendment and we recognize revenue that wasn’t initially budgeted as part of the fiscal year 2022 budget and we make adjustments up and down to approved budgeted line items and with regards to Exhibit A (General Fund) the first section under revenue recognizes all of the adjustments, most of those I am happy to report are either expenditures, revenues that were proposed that were exceeded for example the Property Tax, you can see the current budget, the budgeted amount which addresses the increase over projections and on down the line, property tax in lieu of is in the negative and that simply reflects a former industrial user that has come off its pilot program but is now subsequently moved into its full property tax mode with the City and not necessarily the County but with the City so it is not lost revenue it is just moved and adjusted revenue, Sales Tax continues to increase beyond expectations, the highlighted items are those revenue items that were not initially budgeted, the American Rescue Plan Act-we have received the first of two payments with the second delivery of that same amount ($294K) will come in November as I understand it, Bulletproof vest & Police-Officer Reimburse Contract that is for a former employee who is reimbursing the City for expenses associated with sending that individual through the academy. Expenditure Items in the General Fund-you will see adjustments again these are for items for which a particular activity or item was budgeted that was either not expended in the case of our Administration Update to our regulatory documents which is a perennial line item for adjustments to the Zoning Ordinance which we didn’t get around to, Master Plan Architect for the Pinckney property-we went ahead and we budgeted an amount for a master plan but we weren’t certain what the architectural fees were once we executed that we were a little bit short but we were over in the maintenance so we adjusted that and moved those funds over, there are adjustments to the City Planner, GIS Mapping and the rest of the items that are indicated there are again mostly 1 adjustments for capital expenditures that were not expended which goes back into the piggybank, moving to the Water Fund (Exhibit B) again the first section is recognizing revenue items that are generally related to line items for which the revenue exceeded budgeted amount projections, Interest Income-the notable exception among those just based on the low interest environment, we usually use trend data that is becoming increasingly more difficult with the interest rate environment such as it is, on expenditure items-Supplies/Repairs/Maintenance- obviously it was going to be difficult at the time we approved the budget to foresee the increase in basic materials related primarily to our utility department if we can even get them but that has exceeded the budgeted amount, Water Meters-the same, our Purchase Water from Collierville that is money in, money out so that expenditure is associated with like-kind revenue, Depreciation has increased as our utility grid consisting of new utility lines be that water or sewer results in increased depreciation, Water Plant Preliminary Design-after the City had concluded that its extension with Collierville there was no further need to engage a consultant to design a plant, we did engage in some initial exploratory research to find out where the optimal location would be for wells, Critton/Hollow Roads Water Extension is rolling over into next year’s fiscal budget, the design is complete but we did not get to the construction and the same thing with the Water Tank, Local Gov Upgrade was not required so that money is returned to the Enterprise Fund, moving to the Sewer Fund (Exhibit C) it is the same with revenue items- recognizing increased revenue over the projected revenue receipts, decentralized revenue came in under and that is largely related to the decentralized customers that we have now moved to centralized as the result of the decommissioning of the Greenbrier plant, expenditure items-utilities related largely to the various pump stations we have in the City, Chickasaw Trails Payment like the Collierville water is money in and money out associated with like kind revenue, Decentralized Sewer Plant-State is renewal fees that doesn’t come up every year and we weren’t aware of at the time we approved the budget and then recognizing increased Deprecation, moving to Special Revenue Fund (Street Aid)-the State has split its gas tax so we have added a line item to recognize what the State wants to see (Gas Improvement Taxes) so that was shifted from one line to a new line item, City Paving (Keough)-this is a budgeted capital project in addition to the annual paving $160,000.00 was related to Keough improvement rolling into a new fiscal year, Miscellaneous is miscellaneous revenues, expenditures show a nominal increase of $200.00 in the line item for Grounds maintenance, Small Equipment/Keough Rd. Widening are expenditures not made this fiscal year and the Annual Paving Patching Program expenditure is less than what was budgeted and lastly Exhibit E (Special Revenue Fund related to Sanitation) will see increases in revenue over approved and projected revenue items for garbage collections, recycling and yard waste bags, small decreases in late payment penalties and interest income-again due to interest rate environment and expenditures items; Storm Pickup-we generally budget between $15,000.00 and $20,000.00 annually and we only expended $5,000.00 thanks to the assistance of Collierville during the major storm that we did have, Recycling Costs-a nominal adjustment and that concludes my overview of the first reading and there will be a more through presentation at the public hearing. Action taken: Commissioner Hugh Davis moved to accept Ordinance No. 358-22 on first reading, seconded by Vice-Mayor Mike Binkley. The Motion received all affirmative votes. Agenda item 4. First Reading, Ordinance No. 359-22, adopting the annual Budget and Tax Rate for the Fiscal Year beginning July 1, 2022 and end June 30, 2023 Mr. Steinbach stated the State has required us to move to its budget template which has been incorporated in this document that you are looking at-the actual ordinance and the summary of expenditures, they have asked us to move to this but they have also requested our detailed budget exhibits, there will be a more detailed presentation at the public hearing with graphics and will go line by line through the department budgets and the ordinance before you reflects those reconciled numbers and staff is still tweaking numbers-adjusting for expenditures 2 by the end of this fiscal year as well as late entrants into our fiscal year budget, we are 90% and had Bev pass out a budget highlight sheet just to give you the highlights and I will address the big picture along with answering any specific questions, also we passed out the proposed capital budget and the revenue/expenditure summary which again contains all the information in the State template budget, so the highlights; increased property tax revenue roughly 15%, increased sales tax revenue abruptly 17% (that has been the shining star over the last three fiscal years), decreased building permit revenue is projected over the next fiscal year due to the macro-economic environment, increased enterprise fund (water & sewer) revenue and we are proposing a utility rate increase which will be presented to the Board on first reading and this is resulting from the Rates Studies, Inc. utility rate study that we commissioned and has concluded, we have received those numbers and we are budgeting for increased personnel in utility, it is absolute necessity and we have increased depreciation expenses that we must fund and it is a nominal rate increase that is appropriate and will be reassessing that each fiscal year, with regard to our most important asset-our personnel-we are proposing a 4% cost of living increase across the board for civilian employees, recognizing step promotions as well as an additional 3% cost of living increase for Fire and Police; proposing a $1,500.00 employee retention bonus for each employee, and increasing deferred compensation from 3.5% to 4.0%, the cost of the employee retention bonuses is $60,000.00-it is a nominal cost relative to the overall budget and the deferred compensation increases are identified on your revenue/expenditure summary, we are budgeting for four new employees (3 in Fire to provide for three man 24 hour coverage), we have directed our department heads to encompass a zero based budgeting strategy (meaning let’s look to cut operational expenses-those are flat generally across our departments except for those items generally related to public works and utilities that have seen drastic increases if we can even get the materials in, our capital budget is generally $4 million dollars and that is inclusive of a $673,000.00 TDEC grant for which the City will have to provide a 35% match which is about $217,000.00 so we are leveraging $900,000.00 for $217,000.00 and we are proposing to fund our entire capital budget from our fund savings with no debt and we are anticipating $700,000.00 in projected revenues over proposed expenditures that will go back to fund savings and I ask the Board to adopt the Ordinance at first reading, again most of these numbers are reflected and I turn your attention to the revenue/expenditure summary which identifies each department fund and it illustrates the proposed operating expenses relative to our current fiscal year and recognizes the increase/decrease, Administration that is a flat increase due largely to personnel and most of these are due largely to personnel, Building and Codes-our prior Building Official who was handsomely compensated has retired, Elizabeth Reed is now running that department at a reduced salary that has had a favorable fiscal impact to that department and we have also hired a consultant to assist her, Public Works-has a $28,638.40 increase largely due to personnel same with the Fire Department resulting from budgeting for 3 new additional personnel, there is a decrease in Police due to reductions in operating expenses, a nominal increase in Court, Water and Sewer-those increases are due to new personnel, we are proposing hiring a certified waste water operator, Garbage increased expenses again that is money in/money out related to our sanitation operation. Commissioner Davis inquired on increases for Fire, does that consider hire date or is that an average or is that really enough money for the expansion of three people. Mr. Steinbach stated that is as if the Chief were to hire 3 candidates as of the day of the new fiscal year which is not likely but we have to budget for that, yes there is enough money and happy to report that Chief’s operating budget across the board has been reduced so he is always looking to balance that, we will review the capital budget after this document, the summary of the fiscal year 2023 obligations are identified in the middle of this page, the increased expenditures due to personnel are roughly $215,000.00 that is attributable to raises, salary adjustments, new positions, new hires as well as the retention bonus, Health insurance 3 reflects no increases in premiums, if classification changes in January our cost could go up, Retirement benefit-we are proposing a .5% increase in our deferred compensation from 3.5% to 4.0% at a cost of $15,429.85, and Increased sewer infrastructure depreciation cost of $10,000.00, the summary of all of that is identified under projected revenues vs proposed expenditures-projected revenues by fund; General Fund $3.9 million dollars, Enterprise Fund including tap fees and General Fund is $5.3 million dollars and proposed operating expenditures of $4.6 million dollars leaving an overage of $720,911.90. Commissioner Davis inquired where we keep our depreciation. Mr. Steinbach stated it is a liability account but an encumbrance against our physical cash assets and now to look at the Capital Budget; the highlights for the General Fund- Administration is the Pinckney House Renovations obviously $600.000.00 is the estimated cost by the architects and those documents will be bid out and will be anxiously awaiting those documents and the other big item is a transfer from the General Fund to the Street Aid Fund to pay for the annual paving program, Fire Department-nothing significant under Fund Balance Appropriation, the big items in Fire are the emergency sirens ($130,000.00) and are anticipating grant money and the other large item is land acquisition ($200,000.00) for identifying a site and making plans for ultimately constructing a combined Police/Fire facility and administration supports that endeavor but we need to proceed methodically, he has identified a site and we have had an initial appraisal review of that and are not certain if we can acquire it for that but we are going to purpose we make a go of that, Police-1 police car purchase this year and outfitting cost associated with that, Court-no capital appropriations but continue to fund our third party attorney for appeals, Public Works-Community Drainage Repairs-this is an item that I will propose funding annually, we will be looking at adding a drainage fee to our development fee structure early in this coming fiscal year, Public Works-Capital reflects City Entrance Monument Design that is a roll-over and we have retained a consultant and has been instructed to begin design for the entrance monument signs, requesting service truck replacement which is split over General Fund, Water and Sewer Funds, requesting a backhoe, zero turn mower and Piper (Pinckney) House Park improvements is a place holder and we have also retained a consultant to begin doing preliminary design on a park on the property behind the Pinckney residence and will bring the preliminary sketches before the Board, Building Dept-no capital improvements budgeted, demolition continues to be funded annually, Street Aid-annual expenditures for Street Stripping, Grounds/ROW Maintenance, Capital Street Aid-Milton Drive Street Lighting, Keough Road widening for pedestrian connection which is a roll-over from our current fiscal year, new street light installation and annual paving program, Sanitation-no fund balance appropriations, Sanitation Capital-we are proposing a brush truck as we have reported to the Board, the City is currently sitting on over $200,000.00 in accumulated savings and the City has passed on some of those savings to the residences in terms of a nominal rate cut in recycling and a reduction in our margins nevertheless that money needs to be put to use and that truck is our proposal, the idea is that we would have a brush truck to pick up debris neighborhood by neighborhood and we would set up a mulch area for free mulch for their use, Water Fund balance appropriations- Emergency water infrastructure repair which is budgeted annually, Local Government Upgrade (additional seats for the software), Pubworks software-it is an asset management inventory software (split between water and sewer) which will allow staff to be more efficient in its reporting and inventory management, Water tank maintenance program is proposing that the City engage this vendor and there are some benefits, and Locator, Water Capital proposing water tank electronic valve/vault, SCADA system construction-the Board had previously approved the contract with the vendor and it was split between water and sewer, Bold items are proposed to be funded with the bulk of the TDEC money, so that is why we did start the Critton/Hollow Rds water extension project, the Wastewater Grant is showing (35% match) based on the expenditures, Water line upgrade (TDEC)-Hwy 196 to Hwy 57-there are pressure issues, this is an opportunity for the City to upgrade undersize lines, same with Old Stateline 4 Road, moving on to sewer fund appropriation-moving the sewers, sewer pump replacements, residential tank pumping for our decentralized subdivisions, annual decentralized plants grass mowing-these are items we generally budget annually, Capital items-we just talked about the SCADA improvements this reflects sewer’s portion of that, Piperton Farms sewer extension design again proposed funding under the TDEC monies, Railroad sewer line extension design and construction-this is to get our sewer under the railroad at the Wittichen subdivision to open up development opportunities on Hwy 57, Sewer jetter for cleaning/clearing gravity sewer lines, backhoe which is replacing unrepairable equipment, Service truck reflects sewer’s portion of the split, TDEC-ARP Wastewater represents the sewer funds portion of the match, Generator (Sewer Lift Stations), the total by funds is $4,294,404.00 is reconciled with the $3,884.404.0 on your revenue/expenditure summary, staff asks for your approval on first reading. Commissioner Davis requested a note or annual line item for Business Appreciation just to let them know that we know they are there. Vice-Mayor Binkley stated for the record state the new tax rate. Mr. Steinbach stated the Ordinance does recognize no property tax increase in the body, in section 8 at .3176. Mayor Coats stated thank you to Maria and all of the staff who have done a great job, appreciate it very much for keeping the City in the black. Action taken: Vice-Mayor Binkley moved to approve Ordinance No. 359-22, adopting the annual budget and tax rate for FY 22-23 on first reading, seconded by Commissioner Hugh Davis. The Motion received all affirmative votes. Agenda item 5. Adjournment Action taken: Vice-Mayor Binkley made a motion to adjourn the meeting, seconded by Commissioner Davis. The Motion received all affirmative votes and the meeting was adjourned at 7:41 p.m. Respectfully submitted, Beverly Holloway, City Recorder Approved: _________________________________date:______________________ 5