Budget & Finance Advisory Committee

CITY OF SPRING HILL BUDGET AND FINANCE ADVISORY COMMITTEE MONDAY, MARCH 11,2013 4:30PM Present were: Chad Whittenburg, Rick Graham, Eliot Mitchell, Jim Smith, April Goad, Missy Stahl, Amy Wurth, Jonathan Duda, Bruce Hull, Charlie Schoenbrodt, Brooks Euler, Shelley Taylor, Kayce Williams, Jamie Page (reporter), Bailey Loosemore (reporter) and Doug Phillips Chairman Whittenburg called the meeting to order and named people in attendance. Chair Comments - Chairman Whittenburg recognized Missy Stahl for completing and graduating from the CMFO program through MTAS. Item #1 -Approval of February Meeting Minutes- Alderman Graham made a motion to approve the January minutes. Seconded by Chairman Whittenburg. Motion carried 2-0, no opposition with Alderman Mitchell abstaining as he was absent from the February meeting. Item #2- Current RFQ's & RFP's status updates- Jim Smith- Jim stated we have not sent out any new RFQ's. We just sent out a new RFP to replace all carpeting in City Hall. The engineer RFQ is done and just needs to be sent to eligibles who has not been determined yet. The attorney RFQ is still on hold; Jim will check with Mr. Lay to see when this is planned to go out. Jim discussed the TML insurance renewals to include the new $1 ,000 deductible for workers comp claims. Committee discussed the health care RFQ. It has not been sent to the papers yet but will be this week. It has also been sent to a list of candidates composed of people who have inquired and thru a survey done of all TN municipalties of companies they use. Shelley and Mr. Lay will narrow down the list based on the RFQ requirements met and present the top ones to the BFAC for interviews. Item #3- Discussion of BOMA resolutions/ordinances: • Resolution 13-25- Bad Debt Collection Services Contract- Jim stated we have been using Solutia. They were the only company to respond to the RFP. This service does not cost us anything to turn our bad debt to them to collect on our behalf. Jim stated it is for water bills and court fees and we have not had any complaints against them. Committee discussed the risk the City has on bad debt. Committee also discussed the terms and rates in Solutia' s contract. April stated right now we are having them collect court fees but we can expand to collection of water debt with this same contract. Alderman Mitchell made a motion to favorable recommend Resolution 13-25. Seconded by Alderman Graham. Motion carried 3-0; no opposition. • Resolution 13-26- Haynes Crossing Sidewalk Proposal- Jim stated this is for a stretch from Monoco Drive to Paradise Drive as proposed by the Mayor. It is not a budgeted item so the funds would be added as a budget amendment. Alderman Graham asked how you choose which subdivision comes first when there are so many sidewalks needed. Price is $24,000 with the HOA contributing $7,000. Alderman Wurth, a member of the Haynes Crossing HOA, discussed the contribution but also the safety concerns associated with BFAC Meeting 3/11/13 1  adding this section of sidewalk. They would like for the City to continue the sidewalk down to the Dollar General shopping center. Alderman Mitchell asked if engineering work had been done to make sure we have the easements and if it should go to the Parks and Rec committee, the TAC or the Safety committee before the BFAC makes a recommendation. Committee discussed. Alderman Duda discussed a sidewalk in-fill program Mr. Lay is working on. Jim presented a notebook that has just been completed showing where sidewalks are needed but no order of need has been established. Alderman Wurth discussed what the HOA would like. Alderman Mitchell stated he is ok with sending this to the BOMA for discussion but he would like to know first if engineering work has been done and what the cost was, it needs legal review first and should a plan and budget be developed to determine if this is where we need to start with sidewalks. Jim stated Jerome put the RFP together so he thinks Jerome did do the engineering work. Chairman Whittenburg stated the BFAC will not make a recommendation on Resolution 13- 26 due to lack of information. They will yield to the BOMA to continue further discussion. Item #4 -Discussion of Mayor's request to look at a Property Tax decrease for FY 13114- • Look at Sales Tax Revenues • Look at projected CIP and servicing those projects Jim discussed dropping the tax rate to $0.52. If all expenses stay the same as this year and we leave the tax rate at $0.59 we would have a $92,000 surplus. If we drop the rate and all spending remains the same, we would have a deficit of $362,000. Every penny is worth about $64,000 revenue. Jim discussed the items that are in the approved CIP for the next year and the debt service associated with those items. PFM is making a presentation tonight to the BOMA. We have to stay under $10M borrowed in a calendar year to remain in tax-free status. Stormwater projects are supported by a dedicated source of revenue. Alderman Wurth stated the loss of revenue would almost net out to the gain of the repayment to water/sewer fund. Therefore, we would not be gaining any extra revenues. Charlie Schoenbrodt stated he does not think we need to cut the property tax rate until we have a reserve of about $4M. Chairman Whittenburg stated this is not up for BOMA discussion but instead the Mayor asked the BF AC to review. He thinks the committee needs to vote tonight and make a recommendation back to the Mayor. He made a motion to make an unfavorable recommendation back to the Mayor not in support of a property tax decrease. Seconded by Alderman Mitchell. Motion carried 3-0; no opposition. Chairman Whittenburg will send an email to Mayor and copy everyone letting him know what they decided. Item #5 -FY 13/14 Budget Update- Jim Smith- Jim stated he is at the point where he would like guidance from the BFAC or the BOMA regarding items on the CIP scheduled to come up starting in July. The budgeted amount for Duplex Road has not been spent this year so it could roll over to next year. Chairman Whittenburg stated he would like to see everything included in the budget since it is a BOMA passed CIP and then if we are in the red, things can be taken out. The only staffing changes Jim has included is a City planner and an IT person. The Utility Director is already included in the budget so that will just carry over. Chairman Whittenburg stated he would like to see the budget with three additional firemen and three additional police officers included. Alderman Graham agreed. Jim has also included a 10% increase in health insurance and a 2% increase for salaries across the board (not to include Shelley's second catch-up increases). Other than fire and police, IT and Codes are the only departments that need staffing. Pay increases will eventually be based on merit but that is still being worked on. Alderman Mitchell discussed a City-wide procurement system to help streamline everything between departments. Jim discussed the current system of how things are done but he has in the BFAC Meeting 3/ 11/ 13 2 budget funds for a new system through a RFP. Alderman Mitchell stated this new system needs to be a priority and will be very supportive of an upgrade. Committee discussed needs and costs (approximately $300,000). Jim will have the adjustments done to the projected budget and have it sent out within a week for the committee to review. Item #6- Review of current executive summary financials - Jim Smith - Jim stated the numbers for February look really good. November and December retail sales produced the highest sales tax numbers we have received (received in January and February). Committee discussed the overall numbers. Drug Fund has spent more than they have brought in for the fiscal year but the bank balance is still positive. We have collected property taxes very well for this year so far. We have total cash of almost $15M in the bank to include all funds. Roundtable Discussion - Alderman Mitchell recommended looking for a larger meeting place. Committee discussed time and place for the BF AC meeting. Alderman Graham suggested putting this on next month's BFAC agenda. Chairman Whittenburg stated this will be looked at. Kayce Williams discussed Spring Hill Little League being awarded to host the first intermediate division southeast Regional tournament and State tournament this year in July and what preparations need to be done. All costs of the tournaments are the responsibility of the Little League. She would like for the City to come on board to help with this. She will present the numbers to the City once she gets them. Committee discussed where funds could come from in the budget and corporate donations from various companies (i.e., GM). Mr. Schoenbrodt stated in the future, we should look at establishing an entertainment tax and an occupancy tax for the City. Alderman Hull stated he does not think there is enough information to discuss tonight at BOMA. He suggested putting it on the BFAC agenda for next month to discuss before taking it to BOMA. Alderman Mitchell stated he does not know if legally the City can spend any funds to improve land outside the City limits. Chairman Whittenburg stated this is an outstanding opportunity for Spring Hill Little League and for the City of Spring Hill. Alderman Graham made a motion to adjourn the meeting. Chairman Whittenburg seconded the motion. Meeting adjourned. James H. Smith, Finance Director BFA C Meeting 3111113 3