City Council

August 14, 2009 CITY OF SARATOGA SPRINGS City Council Meeting (Capital Budget Presentation) Agenda 1:00 PM CALL TO ORDER ROLL CALL SALUTE TO FLAG PUBLIC COMMENT PERIOD / 15 MINUTES PRESENTATION(S) 1. Recommendations for 2010 – 2015 Capital Program / Budget EXECUTIVE SESSION None CONSENT AGENDA None MAYOR’S DEPARTMENT None ACCOUNTS DEPARTMENT None FINANCE DEPARTMENT None PUBLIC WORKS DEPARMENT None PUBLIC SAFETY DEPARMTENT None SUPERVISORS None Capital Budget Presentation 8/14/09 CITY OF SARATOGA SPRINGS Capital Budget Presentation City Council Room Friday, August 14, 2009 1:00 PM PRESENT: Scott Johnson, Mayor John Franck, Commissioner of Accounts Ken Ivins, Commissioner of Finance Ron Kim, Commissioner of DPS Anthony Scirocco, Commissioner of DPW STAFF PRESENT: Shauna Sutton, Deputy Mayor Michele Boxley, Deputy Commissioner, Accounts Kate Jarosh, Deputy Commissioner, Finance Eileen Finneran, Deputy Commissioner, DPS Joe Scala, City Attorney ABSCENT: Patrick Design, Deputy Commissioner, DPW RECORDING OF PROCEEDING The proceedings of this meeting were taped for the benefit of the secretary. Because the minutes are not a verbatim record of the proceedings, the minutes are not a word-for-word transcript. CALL TO ORDER Mayor Johnson called the meeting to order at 1:03 p.m. PUBLIC COMMENT Mayor Johnson opened the public comment period at 1:04 p.m. Al Callucci of 9 Lexington Road advised he met with Commissioner Scirocco after the last Council meeting regarding the Gilbert Road waterline project. Since the project came in under budget and the equipment will be there, he feels the City should continue to complete the loop. Also, he noticed the Page 2 of 6 Capital Budget Presentation 8/14/09 public safety building on the next 5 year plan but didn’t see anything about a parking garage. He suggested building a parking garage first; especially since the City Center expansion will need it. The revenue that will be generated from the parking garage could help fund the public safety building and eliminate the amount of burden on the taxpayers. He asked the Council to consider his suggestion in future planning. Mayor Johnson closed the public comment period at 1:07 pm. Presentation Recommendations for 2010 – 2015 Capital Program / Budget Mayor Johnson ran through the agenda for today’s meeting. The proposed capital program will be on line as well as a full copy with all back-up documentation in the City Clerk’s Office and in the library. He read the following message (Mayor’s Message on the 2010 Proposed Capital Program) into the record: Our City Charter is specific in both the content of the Capital Program to be adopted by the City Council as well as designating the Mayor as the Chair of the Capital Program Committee. IN conjunction with the Capital Program Committee, the Mayor is responsible for preparing the City’s Capital Program for a six year period, in this instance from 2010 through 2015. The Mayor is required to transmit the Capital Program projects recommended for the ensuing budget (for year 2010), along with the six year Capital Program, to the Finance commissioner on or before September 15 each year to ensure its incorporation into the City’s annual Capital Budget. Prior to transmission to the Finance Commissioner, the proposed Capital Program must be submitted to the City Council for adoption. The proposed Capital Program must also be submitted to the City Council on or before the first regularly scheduled Council meeting in September of each year. Finally, two public hearings are to be scheduled prior to the Council’s final adoption of the six year Capital Program for 2010. Rather than two public hearing, three hearing are schedule for August 24, 2009 at 7 p.m., August 28, 2009 at 1 p.m. and September 1, 2009 at 6:30 p.m. The deadline of September 15 for adoption of a proposed Capital Program by the City Council is to ensure that the program is ready sufficiently in advance of the overall deadline of November 30 for adoption of the City’s Comprehensive Budget. The eventual Comprehensive Budget shall consist of an Operational Budget, a Capital Budget, and a Debt Service Budget. The Capital Program, per the terms of the Charter, shall consist of capital projects and capital equipment, to be listed by department and contain recommended priorities. Please refer to the City Charter, Section 3.1.1, for the conditions required for each Capital Project to be included into the Capital Program. For 2010, the recommended projects are ranked by priority and confirmed sources of funding. Projects for which funding is presently contingent upon funding other than City bonding are not ranked by the Committee. Failure to assign a ranking to a project, for 2010, should not be construed as the project not being a priority. Rather, the funding for such projects is wholly dependent upon receiving contingency funds, such as grants or Federal and State appropriations, and was a realistic recognition by the Committee that such projects may not be accomplished in 2010. The composition of the Capital Program Committee is also dictated by the Charter and varies significantly in the otherwise ad hoc committees that can be formed to analyze City issues. The Capital Program Committee shall consist of one representative each from the Departments of Finance, Public Safety, Public Works, and Accounts; the City Planner; the City Engineer; Chair of the City Planning Board; a representative of the Recreation Commission; and the Administrator of Parks, Open Lands, and Historic Preservation. This year, as in prior years, there were additional representative, notably the Risk and Safety Manager, to address certain proposed projects and need analysis. However, in the event of disagreement on the inclusion of any proposed project into the Capital Program, only those committee members established by the Charter were entitled to vote and reach consensus. The City Charter also places limitations on bonding capabilities of the City under Section 11.2 of the City Charter, restricting the long term debt bonding of the City to 1% of the average full valuation of taxable real estate of the City, with any further increase in the City’s bonding limits to be approved by voter referendum. By decision of the last City Council in 2006, the bonding capacity was increased to 2%, translating to a current bonding capability of $64,999,128. The City presently has long term debt bonds totaling $26,235,771. Therefore, the net amount presently available for future bonding is approximately $38,000,000, to be in compliance with overall debt limitation. This is the entire bonding capability remaining for all future years, not to be confused with what is available on a year by year basis. The Capital Program Committee reviewed a number of proposed capital projects for 2010 alone. Of the 6 projects recommended for 2010, totaling $1,650,000, there should be deducted $400,000 for one project (Water improvement and replacement project), thereby reducing the proposed long term bond debt for 2010 to Page 3 of 6 Capital Budget Presentation 8/14/09 $1,250,000. By historical contrast, for 2008 the 2007 Capital Program Committee had recommended capital projects totaling $25,790,000 for bonding in 2008 alone. Last year’s committee had recommended $5,141,000 for bonding in 2009. The City Charter also clarifies, per Section 3.1.3, that the Mayor shall present to the City Council and the public the six year Capital Program “highlighting capital request for the upcoming fiscal year to be included in the City’s annual Capital Budget.” Therefore, neither the City Council nor the public should misconstrue any projects listed beyond the year 2010 as either approved for recommendation as actual Capital Projects to be undertaken, or as referendum on the viability and acceptance of such projects ultimately by the City Council and the public. Clearly, the City Council and the public have not decided whether future projects beyond 2010 will ultimately be undertaken by the City, but there was sufficient supporting financial documentation submitted to include them within the future projected years as a potential project. Accordingly, the overall projected cost of the entire six year program must not be viewed as any recommendation, by this Committee or the Mayor’s office, to actually undertake and accomplish all the projects beyond those actually recommended for 2010. Any particular action should not be viewed by the public as any referendum whatsoever by this Committee on whether the City should undertake all projects. Rather, the decisions were difficult but necessary because all future projects cannot simply be bonded. The public should also be aware that the present economic downturn and pre-existing debt and obligations were a significant factor in this Committee choosing to be fiscally conservative, again given the present economic forecast and continue uncertainty. In this message, I have attempted to present some insight and explanation for the recommendations now presented to the City Council and public for approval. However, this message should not be construed as one endorsed or sent with the full approval of the Committee. I also wish to thank the Committee again this year for their dedication, cooperation and hard work. As your elected official, I feel compelled to provide some insight into the proposed program, while recognizing and respecting there may be differing opinions. In any event, I am sure the Committee joins me in expressing the intention to be fiscally responsible and conservative with your tax dollars. Respectfully submitted, Scott T. Johnson Mayor Johnson went on to explain the capital program is mandated by the City Charter as a program to identify, over a 6 year period, the capital needs of the City and the proposed means of financing. The program is to indicate the amount proposed to be finance by local taxes and the amount, if any, estimated to be received from the Federal government, the State government, any other government, etc. The source of the funding needs to be identified for inclusion in the Capital Program. The primary focus is for the upcoming year, 2010. Mayor Johnson explained how the capital program was developed and those who make up the committee. The recommended projects are ranked by priority and confirmed sources of funding. If the funding of a project is contingent upon a source other than City bonding, those projects were not ranked by the committee. Failure to assign a ranking to a project should not be construed as the project not being a priority. Mayor Johnson explained the City’s current long-term debt bonding capacity or limit is $64,999,128. Of that limit the amount that can potentially be bonded is approximately $38,763,357. This committee’s recommendation is to bond $1,650,000 for 2010, of which $400,000 is water bonds which are excluded from the debt limit. The water fund is a fund available to pay off the bonds taken out for water projects. It is a separate fund that is not factored into the overall City debt limit per Charter. A 3 year history of capital program recommendations is as follows: Committee Recommendation Accepted by Council Included in Budget 2008 $25,799,914 No Program Adopted $13,298,314 2009 $ 5,141,000 $7,736,000 $2,150,000 2010 $ 1,650,000 A 6 year Capital Program was passed last fall for this year. The $5 million dollar recommendation was increased to provide additional money for a police station. That increase is what raised the figure accepted by the Council for 2009. The $5 million had been reduced first and the $3 million for public safety was added at the last minute to raise the amount accepted to the $7 million dollar figure. The amount actually included in the City budget at bonded was $2,150,000. This year the committee is Page 4 of 6 Capital Budget Presentation 8/14/09 recommending the bonding of $1,650,000 for 6 different projects. The recommendation is the lowest in years. The economy is the driving force behind this recommendation. The mayor provided copies of the entire 6 year program to the Council and the public (attached). The projects that are being recommended are those that if not undertaken in 2010, there is great risk to the City in terms of providing essential services to our community. #1 – Canfield Casino Rehab Project. There are a number of projects needed at this facility such as the handicap access to the building, the roof, foundation, ceiling in the ballroom, and other structural issues. This project is to span through the entire 6 year Capital Program. The amount recommended for 2010 is $400,000. #2 – Visitor Center Replacement Project. This building requires roof repairs and repairs to the northeast corner of building. The amount recommended for 2010 is $175,000. #3 – Vacuum – Sewer Cleaning Truck. The amount recommended for the purchase of a new truck is $300,000. #4 – City Building and Facilities. Money is dedicated each year for the up keep of buildings. The recommended amount is $200,000 for 2010. #5 – Water Improvement & Replacement Project. This is a multi-year upgrade for the replacement of 4 inch watermains throughout the City. The amount recommended for 2010 is $400,000. #6 – Sewer Jet. This is a DPW item and a critical piece of equipment. The current equipment is a 1991 truck which will be replaced. The amount recommended for 2010 is $175,000. Mayor Johnson continued to go through the list of projects that are contingent upon grants or school funding as follows: Blueway Trail – a request has been put in for funding of $30,000 with matching funds from the City. Waterfront Property Re-development – we have filed for grant money to open up the lowest level of the 3 tiers of the park. This will only be undertaken if we receive money through various grant applications. Municipal Facility (Design, Land, Site Development, Construction) – This is the police station. The documentation submitted by public safety indicated special funding requests made through federal and state governments. New Eastside EMS Facility – This is for EMS and fire response contingent upon funding through FEMA applications. Fire Engine – The amount is $407,000. East Side and West Side Recreation Improvements – The $25,000 is the portion we receive from the schools annually in exchange for the City’s services to maintain the fields. Refurbishment of Bleachers – This is for the East Side Recreation green bleachers. These bleachers have been closed based upon safety concerns. The figure of $85,000 is a best estimate. Lockers at the Ice Rink – The school district has asked the City to be involved with this. The school has offered $12,000 towards this project. Mayor Johnson stated he would be happy to address any questions about the remaining 5 years. The public can go to him in-between meetings with any questions. The charge of the committee is to identify future capital needs of the City and included projects beyond 2010. Mayor Johnson advised the City Charter requires 2 public hearings before the adoption of the capital program by the City Council. Three public hearings have been scheduled: August 24, 2009 at 7:00 p.m., August 28, 2009 at 1:00 p.m., and September 1, 2009 at 6:30 p.m. Per the Charter, the capital program must be submitted to the Council with a vote by September 15, 2009. It will then be forwarded to Commissioner Ivins for inclusion in the City’s comprehensive budget of 2010. The Council is due to adopt a comprehensive budget by November 30, 2009. Mayor Johnson announced there will be monthly meetings throughout the year of the capital program committee to better facilitate ongoing discussion of the capital needs of the City. This will be more productive and efficient to keep a handle on it year round. Mayor Scott Johnson moved and Commissioner Ivins seconded to adjourn the meeting. Page 5 of 6 Capital Budget Presentation 8/14/09 Ayes - All There being no further business, Mayor Scott Johnson adjourned the meeting at 1:45 pm. Respectfully submitted, Lisa Ribis Clerk Approved: 9-1-09 Vote: 5 - 0 Page 6 of 6