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Budget Amendment FY 04MEMORANDUM July 21, 2003 TO: FROM: SUBJECT: The Honorable Mayor and City Council Members Michael C. Van Milligen, City Manager Utility Franchise Fee t would like to modify my recommendation for the Utility Franchise Fee. I had recommended adoption of a 3% Utility Franchise Fee that would generate net revenues of $1,081,997 in Fiscal Year 2004 and $1,622,184 in Fiscal Year 2005. This 3% fee included a net increase of 1% to residential, commercial and industrial customers, because of the fact that the City 1% local option sales tax and the school 1% local option sales tax could no longer be collected. Organizations that are currently exempt from paying all sales taxes would see a 3% increase in their cost. I did not recommend a rebate for these groups. My amended recommendation is for a 2% Utility Franchise Fee with a rebate for the full 2% to organizations currently exempt from sales taxes. This would mean that no individual, business or organization would see an increase in their costs, but the City would see an increase in general fund revenues. The 2% Utility Franchise Fee would take the place of the City 1% local option sales tax and the School 1% local option sales tax for those who are required to pay those taxes now. All others would receive a rebate of the franchise fee. Under this revised recommendation for a 2% Utility Franchise Fee, the City general fund would receive $641,000 in Fiscal Year 2004 and $879,535 in Fiscal Year 2005. This change would be done in conjunction with the Fire Union concessions to their overtime pay and their acceptance in the change in dental benefits, saving the City $62,206. To make up the remaining funds needed to balance the budget in Fiscal Year 2004 ($378,791), I would suggest that the following Fiscal Year 2004 Capital Imprevemenl Projects be canceled: Fire Department- Station #2 Driveway and Exterior Improvements Fire Department - Radio to Replace Telephone Lines Fire Department - Station #4 Improvements Fire Department - Statio~ #5 Improvements Leisure Services - Softball Fields at Vets Histodc District Grants Program TOTAL $62,000 $17,500 $5,800 $13,600 $139,500 $139,450 $377.850 I respectfully request that the Mayor and City Council set a public hearing for Monday July 28, 2003 at 6:00 p.m. to consider this recommendation. Michael C. Van Milligen MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager Pauline Joyce, Administrative Services Manager Jeanne Schneider, City Clerk FRANCHISE FEE REVENUE Sales Tax and Potential Franchise Fees on Residential, Gas and Electric Bills Within City Limits City School Calendar Year State Tax 2001 5.00% 2002 4.00% 2003 Jan.-June 3.00% 3.00% Local Option Local Option 1.00% 0.00% 1.00% 0.00% 1.00% 0.00% Franchise Fee 2.00% 2.00% 2.00% 17-Jul I m pact on City Residents 6.00% 5.00% 4.00% FRANCHISE FEE REVENUE Sales Tax and Potential Franchise Fees on Commercial and Industrial Gas and Electric Bills Within City Limits City School Calendar Year State Tax Local Option Local Option Franchise Fee 2002 5.00% 1.00% 0.00% 2003 Jan.-June 5.00% 1.00% 0.00% 5.00% 5.00% 2,00% Any electricity or natural gas used in processing is exempt from sales tax, but not exempt from the franchise fee. Impact on Comm./Ind. 6.00% 6.00% 7,00% FRANCHISE FEE REVENUE Sales Tax and Potential Franchise Fees on Sales Tax Exempt Properties Within City Limits City School Impact on Calendar Year State Tax Local Option Local Option Franchise Fee Tax Exempt 2OO2 0.O0% Sales tax exempt includes private nonprofit educational institutions, nonprofit private museums, tax-certifying or tax-levying body or governmental subdivision, including state board of regents, state department of human services, state department of transportation, all divisions, boards, commissions, agencies, or instrumentalities of state, federal, county or municipal government which do not have earnings going to the benefit of an equity investor or stockholder. Any electricity or natural gas used in processing Is exempt from sales tax, but not exempt from the franchise fee. MEM ORANDUM July 17, 2003 TO: FROM: SUBJECT: The Honorable Mayor and City Council Members Michael C. Van Milligen, City Manager Budget At the July 9, 2003 Public Hearing on the Fiscal Year 2004 budget amendment, the City Council directed me to further examine a Utility Franchise Fee. After receiving citizen input, listening to the City Council discussions over the last two months, and further examining the available options, I respectfully request Mayor and City Council approval of a 3% Utility Franchise Fee effective October 1, 2003, on the franchises held by Aquila and A] [iant Energy for electricity and natural gas and that a public hearing be set for Monday, July 28, 2003, at 6:00 p.m. to further consider this matter. In the Franchise Fee Agreement with Aquila and Alliant Energy, the Franchise Fee is capped at 3% and a unanimous vote of the City Council is required for approval. The Franchise Fee would allow the restoration of many of the cuts proposed for the Fiscal Year 2004 budget, including eliminating the non-union employee wage freeze and bdnging down next year's projected property increase in Fiscal Year 2005 from 10.54% to 8.05%. Recognizing that over the last nine years there has not been a property tax increase for the average homeowner for the City portion of their property tax bill, in fact, there has been five decreases totaling 7%, this 8.05% increase in Fiscal Year 2005 would be a 1.05% increase over a ten year pedod. As we are all aware, the State of Iowa handed the City of Dubuque most of this problem when the State cut funding to local governments state-wide by $60 million, which is a cut to the City of Dubuque of $1,070,425 The State of Iowa might have inadvertently provided a solution to a budget cdsis they created. In 2002 the State of Iowa began phasing out the 5% State sales tax on residential utility bills. The State is reducing the tax by 1% a year through 2006. n 2006, there will no longer be a State sales tax on residential utility bills. Adoption of a City of Dubuque Utility Franchise Fee of 3% would be mitigated by this drop of 5% by the State of Iowa. 1 There are further mitigating factors which lessen the impact of the 3% Franchise Fee on residential properties. Currently, residential properties pay a 2% local option sales tax (1% to the City and 1% to the schools) on their utility bill. State law removes the local option sales tax from a utility bill when there is a franchise fee. Therefore, a 3% Utility Franchise Fee only costs the residential consumer 1%. The residential consumer would see a high of a 6% charge on their utility bills in 2003 with the State sales tax and Utility Franchise Fee, but go down to a 3% charge in 2006 and beyond, because of the State sales tax reduction and the removal of the local option sales tax. The City of Dubuque is struggling with a substantial budgetary shortfall - mainly the result of a $1,070,425 funding cut from the State of Iowa. This reduction came without warning, and it impacts every department and division within the City. Even more unfortunate, this shortfall comes on the heels of a difficult budgeting process and represents an additional revenue loss. Planning for the Fiscal Year 2004 budget began with City Council goal-setting in August 2002 and included a thorough, detailed and intense examination of the City's finances. The budget process continued with a series of public hearings in February and March. At that time, the City Council addressed a $1 million shortfall, which included a $312,513 state-mandated increase in police and fire pension costs and a 35% boost in health insurance. While considering these cost increases, Council Members had to take into account stagnating tax revenues after a national economic downturn. Dealing with a budget shortfall is a challenging task. Througnout the process, the City Council made the difficult, but financially responsible decisions. After approval, the Fiscal Year 2004 budget, which included the ninth consecutive year of no property tax ~ncrease for the average homeowner, was sent to the State of Iowa for certification by the March deadline. Unfortunately, the budget stow doesn't end there. After the budget was certified, the Iowa Legislature passed laws that dramatically reduced State aid to cities. The result for the City of Dubuque is a reduction of $1,070,425 in revenue or 3.28% of the general fund operating expense. Also, health insurance costs have continued to increase at a rate exceeding budget expectations. The projected recurring cost in Fiscal Year 2004 to cover health insurance is an additional $613,766 (with $315,000 in other budget shortfalls). After addressing a $1 million shortfall during the initial budgeting process, the City's operating budget now faces a reduction of $1,799,103 in tax funds and a $200,088 shortfall in non-tax supported funds. The State of iowa has permanently eliminated this funding to cities making this reduction an annual, recurnng loss. Therefore, findin ~1 a solution for this revenue loss cannot be a one-time, short-term solution. The City of Dubuque runs a lean operation that provides excellent services at some of the lowest rates in the State of Iowa. The following compares Dubuque with the other large cities in Iowa: 2 Property Tax Rank CITY TAX RATE 9 Watedoo 18.37162 8 Des Moines 17.04857 7 Iowa City 16.81344 6 Council Bluffs 16.42850 5 Sioux City 15.95108 4 Davenport 14.63000 3 Cedar Rapids 12.82969 2 Dubuque 10.2730 1 Ames 9.63962 The highest-ranked city (Waterloo) is 79 % higher than Dubuque's rate, and the $14.665 average is 42.8% higher. Refuse Rates RANK CiTY MONTHLY FEE PAY AS YOU THROW 7 Ames $20.50 No (average fee for private service) 6 Cedar Rapids $12.56 Yes 5 Iowa City $12.10 Yes 4 Waterloo $11.00 Yes 3 Des Moines $10.25 No 2 Sioux City $9.50 No 1 Dubuque $7.60 Yes The highest-ranked city (Ames) is 170 % higherthan Dubuque's rate, and the $~1.93 average is 57% higher. Water rates RANK CITY WATER US ED (800 cubic feet/residential average) 5 Ames $18.42 4 Des Moines $15.86 3 Council Bluffs $14.00 2 Dubuque $12.80 1 Cedar Rapids $12.48 The highest-ranked city (Ames) is 44 % higher than Dubuque's rate, and the $14.94 average/s I5% higher. 3 Sewer Rates RANK CiTY SEWER FEE (Based on 800 cubic fi/month) 9 iowa City $31.82 8 Des Moines $21.56 7 Waterloo $18.95 6 Sioux City $17.11 5 Ames $16.78 4 Council Bluffs $15.12 3 Davenport $13.76 2 Dubuque $13,04 1 Cedar Rapids $10.73 The highest-ranked cify (Iowa City) is 144 % higherthan Dubuque's rare, and the $I7.65 average is 35% higher. Stormwater Utility Rates RANK CITY RATE* *Average Monthly Residential rate 8 Des Moines $4.60 7 Burlington $3.00 6 Garner $2.63 5 Cedar Rapids $2.25 4 Boone $1.95 3 Sioux City $1.84 2 Ames $1.50 1 Dubuque $1.29 The highest-ranked city (Des Moines) is 257 % higher than Dubuque's rate, and the $2.38 average is 85% higher. The City of Dubuque workforce has declined by nearly 12 percent or 69 positions since 1981 in spite of adding numerous services. Initiatives dudng that time period have included: Yard waste and recycling Economic development efforts County-wide E911 dispatch Comprehensive housing programs Community oriented policing DARE and other drug-related programs ~ental prope~y inspections Operations of the new leisure pools McAleece Recreation Complex City Focus newsletter industrial pretreatment and lead and copper testing programs Fifth Street Parking Ramp Fourth Street Parking Ramp Hazardous materials team 4 MEMORANDUM July 17, 2003 TO: FROM: SUBJECT: The Honorable Mayor and City Council Members Michael C. Van Miltigen, City Manager Budget At the July 9, 2003 Public Hearing on the Fiscal Year 2004 budget amendment, the City Council directed me to further examine a Utility Franchise Fee. After receiving citizen input, listening to the City Council discussions over the last two months, and further examining the available options, I respectfully request Mayor and City Council approval of a 3% Utility Franchise Fee effective October 1, 2003, on the franchises held by Aquila and Alliant Energy for electricity and natural gas and that a public hearing be set for Monday, July 28, 2003, at 6:00 p.m. to further consider this matter, in the Franchise Fee Agreement with Aquila and Alliant Energy, the Franchise Fee is capped at 3% and a unanimous vote of the City Council is required for approval. The Franchise Fee would allow the restoration of many of the cuts proposed for the Fiscal Year 2004 budget, including eliminating the non-union employee wage freeze and bringing down next year's projected property increase in Fiscal Year 2005 from 10.54% to 8.05%. Recognizing that over the last nine years there has not been a property tax increase for the average homeowner for the City portion of their property tax bill, in fact, there has been five decreases totaling 7%, this 8.05% increase in Fiscal Year 2005 would be a 1.05% increase over a ten year period. As we are all aware, the State of Iowa handed the City of Dubuque most of this problem when the State cut funding to local governments state-wide by $60 million, which is a cut to the City of Dubuque of $1,070,425 The State of Iowa might have inadvertently provided a solution to a budget crisis they created. In 2002 the State of Iowa began phasing out the 5% State sales tax on residential utility bills. The State is reducing the tax by 1% a year through 2006. n 2006, there will no longer be a State sates tax on residential utility bills. Adoption of a City of Dubuque Utility Franchise Fee of 3% would be mitigated by this drop of 5% by the State of Iowa 1 There are further mitigating factors which lessen the im pact of the 3% Franchise Fee on residential properties. Currently, residential properties pay a 2% local option sales tax (1% to the City and 1% to the schools) on their utility bill. State law removes the local option sales tax from a utility bill when there is a franchise fee. Therefore, a 3% Utility Franchise Fee only costs the residential consumer 1%. The residential consumer would see a high of a 6% charge on their utility bills in 2003 with the State sales tax and Utility Franchise Fee but go down to a 3% charge in 2006 and beyond, because of the State sales tax reduction and the removal of the local option sales tax. The City of Dubuque is struggling with a substantial budgetary shortfall - mainly the result of a $1,070,425 funding cut from the State of Iowa. This reduction came without warning, and it impacts every department and division within the City. Even more unfortunate, this shortfall comes on the heels of a difficult budgeting process and represents an additional revenue loss. Planning for the Fiscal Year 2004 budget began with City Council goal-setting in August 2002 and included a thorough, detailed and intense examination of the City's finances. The budget process continued with a sedes of public headngs in February and March. At that time, the City Council addressed a $1 million shortfall, which included a $312,513 state-mandated increase in police and fire pension costs and a 35% boost in health insurance. While considering these cost increases, Council Members had to take into account stagnating tax revenues after a national economic downturn. Dealing with a budget shortfall is a challenging task. Throughout the process, the City Council made the difficult, but financially responsible decisions. After approval, the Fiscal Year 2004 budget, which included the ninth consecutive year of no property tax increase for the average homeowner, was sent to the State of Iowa for certification by the March deadline. Unfortunately, the budget stow doesn't end there. After the budget was certified, the Iowa Legislature passed laws that d ramaticalty reduced State aid to cities. The result for the City of Dubuque is a reduction of $1,070,425 in revenue or 3.28% of the general fund operating expense. Also health qsurance costs have continued to increase at a rate exceeding budget expectations. The projected recurring cost in Fiscal Year 2004 to cover health insurance is an additional $613,766 (with $315,000 in other budget shortfalls). After addressing a $1 million shortfall during the initial budgeting process, the City's operating budget now faces a reduction of $1,799,103 in tax funds and a $200,088 shortfall in non-tax supported fun(is. The State of Iowa has permanently eliminated this funding to cities making this reduction an annual, recurring loss. Therefore, finding a solution for this revenue loss cannot be a one-time, short-term solution. The City of Dubuque runs a lean operation that provides excellent services at some of the lowest rates in the State of Iowa. The followin9 compares Dubuque with the other large cities in Iowa: 2 Property Tax Rank CITY TAX RATE 9 Waterloo 18.37162 8 Des Moines 17.04857 7 Iowa City 16.81344 6 Council Bluffs 16.42850 5 Sioux City 15.95108 4 Davenport 14.63000 3 Cedar Rapids 12.82969 2 Dubuque 10.2730 1 Ames 9.63962 The highest-ranked city (Waterloo) is 79 % higher than Dubuque's rate, and the $14.665 average is 42.8% higher. Refuse Rates RANK CITY MONTHLY FEE PAY AS YOU THROW 7 Ames $20.50 No (average fee for private service) 6 Cedar Rapids $12.56 Yes 5 Iowa City $12.10 Yes 4 Watedoo $11.00 Yes 3 Des Moines $10.25 No 2 Sioux City $9.50 No 1 Dubuque $7.60 Yes The highest-ranked city (Ames) is 170 % higherthan Dubuque's rate, and the $11.93 average ia 57% higher. Water rates RANK CITY WATER USED (800 cubic feet/residential average) 5 Ames $18.42 4 Des Moines $15.86 3 Council Bluffs $14.00 2 Dubuque $12.80 1 Cedar Rapids $12.48 The highest-ranked city (Ames) is 44 % higher than Dubuque's rate, and the $14.94 average ia 15% higher. 3 Sewer Rates RANK CiTY SEWER FEE (Based on 800 cubic fi/month) 9 iowa City $31.82 8 Des Moines $21.56 7 Waterloo $18.95 6 Sioux City $17.11 5 Ames $16.78 4 Council Bluffs $15.12 3 Davenport $13.76 2 Dubuque $13.04 1 Cedar Rapids $10.73 The highest-ranked city (iowa City) is 144 % hlgherthan Dubuque's rate, and the $17.65 average is 35% higher. Stormwater Utility Rates RANK CITY RATE* *Average Monthly Residential rate 8 Des Moines $4.60 7 Burlington $3.00 6 Garner $2.63 5 Cedar Rapids $2.25 4 Boone $1.95 3 Sioux City $1.84 2 Ames $1.50 1 Dubuque $1.29 The highest-ranked city (Des Moines~ is 257 % higher than Dubuque's rate, and the $2.38 average is 85% higher. The City of Dubuque workforce has declined by neady 12 percent or 69 positions since 1981, in spite of adding numerous services. Initiatives during that time period have included: Yard waste and recycling Economic development efforts County-wide E911 dispatch Comprehensive housing programs Community odented policing DARE and other drug-related programs Rental property inspections Operations of the new leisure pools McAleece Recreation Complex City Focus newsletter Industrial pretreatment and lead and copper testing programs Fifth Street Parking Ramp Fourth Street Parking Ramp Hazardous materials team 4 Advanced life support ambulance service Government Channel 8 programming Cable TV monitoring and regulation Additional commissions including Long Range Planning, Environmental Stewardship, Investment Oversight, Development Review Committee Extensions of bike and hike trails City-operated FBO functions Increased zoning code enforcement Developers and builders reundtables tm plementation of riverfront plan Downtown c~rculation study Implementation of the Neighborhood Reinvestment Strategy Lead paint abatement program School resource officer program Washington D.C. initiative Increased security operations at the airport Thirteen additional neighborhood parks Reinstatement of traffic accident investigations Police K-9 unit Even with a Utility Franchise Fee. the amended Fiscal Year 2004 budget includes the elimination of five additional positions for a total reduction of 74 or heady 13 percent of the workforce since 1981. This has been accomplished despite adding certain positions, like 15 Police Officers, since 1994. Public safety exemplifies one of those areas where the City provides excellent service. The Insurance Service Office (ISO) rating is a national classification system that rates a community's fire protection capabilities with a score of 1 to 10, with 1 being the best. The ISO rates 45,898 fire departments nationwide. The City of Dubuque finished higher than 96.2% or 44,148 of the other fire departments in the country with a Class 3 rating. The City of Dubuque's ability to deal with a fire is in an elite class of 1,750 departments that are rated between I and 3. This puts the City of Dubuque in the top 3.8% of fire departments in the country. No fire department in the State of Iowa has a higher classification than Dubuque. Under State of Iowa law, franchise fees may be implemented as part of a service agreement executed between local governments and a utility company. In Dubuque, AIliant Energy and Aquila provide electric and natural gas services to businesses and residences. These service agreements are made to ensu re service to all customers in a territory and outline the terms under which utility companies provide service. The intent of these fees is to reimburse local governments for use of public rights-of-way and other public services. A franchise fee typically is calculated on a percentage of the revenues derived from the sales of gas or electricity to customers n that community. A franchise fee is imposed in lieu of licenses or permits that would otherwise be required. A franchise fee can be imposed as a percentage of gross sales, so the exact amount would vary each month. However, the impact of a franchise fee in Dubuque would not be as significant due to some changes in the State of Io~,a taxing system. If the City of 5 Dubuque were to implement a franchise fee in 2003, residential property would pay the 3% franchise fee in addition to the 3% iowa tax for a total of 6%. However, in 2004 the State tax declines to 2%, while the franchise fee would remain at 3%. The total in 2004 is 5%. The total in 2005 is 4%. By the year 2006, the State tax is phased out, and only the franchise fee remains at 3%. When a community implements a franchise fee, local option taxes cannot be collected. In the case of Dubuque, this 2% in local option sales taxes would come off of residential, commercial and industrial bills. Commercial/industrial customers are not receiving a break on their state sales tax (unless the electdc or gas is used ~n processing) therefore, their overall bill would go up 1% with the 3% franchise fee. Entities that are currently exempt from sales tax would not be exempt from the franchise fee, but they would still be exempt from sales tax. Safes Tax and Potential Franchise Fees on ~ Gas and Electric Bills within City Limits City School Impact on Calendar Year State Tax Local Option Local Option Franchise Fee City Residents 2001 5.00% 1.00% 0.00% 6.00% 2002 4.00% 1.00% 0.00% 5.00% 2003 Jan.-June 3.00% 1.00% 0.00% 4.00% 6 Sales Tax and Potential Franchise Fees on Gas and E ectric Bills within City Limits City School Imeact on Calendar Year State Tax Local Option Local Option Franchise Fee Comm./ind. 2002 5.00% 1.00% 0.00% 6.00% 2003 Jan.-June 5.00% 1.00% 0.00% 6.00% ~ s.oo% ~ ~ ~ 2004 and beyond 5.00% 3.00% 8.00% Any electricity or natural gas used in processing is exempt from sales tax but not exempt from the franchise fee. Sales Tax and Potential Franchise Fees on within City Limits Calendar Year State Tax City School Franchise Impact on Local Option Local Oetion Fee Tax Exempt 2002 0.00% 2004 and beyond 3.00% 3.00% *Sales tax exempt includes private nonprofit educational institutions, nonprofit pdvate museums, tax-certifying or tax- levying body or govemmental subdivision, including state beard of regents, state department of human sennces, state department of transportation, all divisions, boards, commissions, agencies, or instrumentalities of state, federal, county, or municipal government which do not have earnings going to the benefit of an equity investor or stockholder. Any electricity or natural gas used in processing is exempt from sales ta,~ but not exempt from the franchise fee, The revenues from a 3% Utility Franchise Fee are projected to be $1,081,997 in Fiscal Year 2004 (9 months) and $1,622,184 in Fiscal Year 2005. Since the City would no longer collect the City. local option sales tax the City could lose $216,399 from the Fiscal Year 2004 CIP and $324,437 from the Fiscal Year 2004 CIP. 7 FRANCHISE FEE REVENUE Aquila Rev. Alliant Rev. Average Taxable by Source by Source by Source Value-FY 04 Residential 69.00% 40.50% 54.75% 49.00% Commemial 28.00% 16.00% 22.00% 40.00% Industrial 3.00% 42.60% 22.80% 5.00% Utilities/Other 0,90% 0.45% 6.00% Impact FY 2004 Effective Date Oct. 1 Impact FY 2005 Total 100.00% Revenue from 3% 750,000 Loss of Sales Tax Revenue in General Fd Operating Budget (125,000) Capital Budget (125,000) Net Gain in Revenue Overall Net Gain in Revenue for Operating budget Net Loss in Revenue into Capital budget 100.00% 1,196,621 (199,437) (199,437) Total Total Total 100.00% 1,946,621 (324,437) (324,437) 1,297,747 1,622,184 (324,437) 1,298,396 (216,399) (216,399) 865.597 1,081,997 (216,399) 1.946,621 (324,437) (324,437) 1,297,747 1,622,184 (324,437) As directed, I met with the leadership of Teamster's Union, Local ¢421 and the Dubuque Professional Firefighter's Association, Local #353. The discussions with the Teamsters revolved around the Park Ranger position. The Teamsters membership had already rejected a wage freeze and already accepted all the requested health care changes. They asked the City to consider raising the entry fee at Eagle Point Park from $1 to $2, which would generate over $60,000, more than enou9 n to pay for the Park Ranger position, or cancel a Park's Division Capital Improvement Project. The Firefighters reiterated their wiliness to change their FLSA overtime to comp time and accept paying their full dental premium, which is accepting part of the health care changes accepted by other employees (except the Police umon). This will save the City $62,206 in Fiscal Year 2004. I have included this $62,200 savings in my revised budget recommendation. If the City Council does not approve the Utility Franchise Fee, all the previously approved cuts, including the non-union wage freeze and the position eliminations, will be implemented. To fund the three Fire Equipment Operator positions, the Park Ranger position, restore Saturday Fixed Route Bus Service and not increase Fixed Route or paratransit fares, the funding will come from the Capital Improvement Program budget in the amount of $307,729, and the $62,206 offered up by the Fire Union by accepting the changes in dental premiums and allowing FLSA overtime to be compensated through time-off, instead of overtime. The canceled ClPs are the Historic Distdct Grant Program ($139,450), the softball field renovation at Vet's Park ($139,500) and $28,779 of the $62,000 Fire Station #2 ddveway and exterior improvements. Canceling these CIPS merely pushes this problem into Fiscal Year 2005, which's already looking at a 10.54% property tax increase for a maintenance level budget. This will push the anticipated Fiscal Year 2005 property tax increase of 10.54% to 13.77%, instead of reducing it to 8.05%, as would the implementation of a Utility Franchise Fee. Administrative Services Manager Pauline Joyce has provided the attached additional information on these very important issues. Michael C. Van Miliigen MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager Pauline Joyce, Administrative Services Manager 9 MEM ORANDUM July 15, 2003 TO: FROM: SUBJECT: Michael C. Van Miiligen, City Manager Pauline Joyce, Administrative Services Manager ~ Fiscal Year 2004 Budget Amendment Hearing Follow-Up The purpose of this memorandum is to provide follow-up information from the July 9 Fiscal Year 2004 budget amendment public hearing. Attachment A is an updated summary with City Council actions/direction from the July 9t~ public hearing highlighted in yeflow. The Fire Union representatives have again stated their agreement to shift the cost of single dental coverage expense to employees and to utilize comp time versus overtime for FLSA overtime hours if the three Fire Equipment Operator positions are maintained. The savings associated with these changes is $62,206, leaving a shortfall of $127,794 to make up from additional cuts and/or revenue increases to save these three positions. Attachment B is a summary of capital improvement budget reductions that are recommended if City Council chooses to proceed with funding the extra $127,794 needed to restore the three Fire Equipment Operator positions, the $43,916 needed to restore the Park Ranger position, and $135,075 required to restore Saturday Transit service ano avoid the Transit fare increases. The recommended capital budget reductions include elimination of a CIP for Realignment of the Veterans Memorial Park Fields I and II ($139,500), eliminating the current year balance of $139,450 in the Historic District Grant program and canceling or deferring a portion of the Fire Station #2 Ddveway and Exterior improvements ($27,779 from the total $62,000 budgeted for this project). Attachment C provides additional background information and analysis on the electric and gas franchise fee per City Council direction. Included in this packet is a summary of the impact of the franchise fee if it were initiated in Fiscal Year 2004 in terms of the decision package cuts that could be avoided. GENERAL FUND FY 04 FY 05 Cat. Priority Dept Item Amount Amount 0 City-wide O City-wide 0 City*wide 0 Citv-wide 0 City-wide O City-wide 0 City-wide 0 City*wide 0 City-wide 0 Citwwide 0 City-wide 0 City-wide O City-wide 0 City-wide Impeol of State cuts Liquor Sales Tax Credit 269.942 269,942 Municipal Assistance 305.715 305.715 Personal Property Tax Replacement 449.968 449.968 Monies and Credit Reolacement 44,800 44,800 Homestead Tax Credit change Imnact of health cost increases 413.678 413.678 Hiring freeze/confined space revenue 315.000 315.000 One month lag in positions cuts-Aug. 9 50.000 50,000 Unemployment costs,outplacement, 60,000 80,000 Retirement Incentive 30,000 30.000 SS and IPERS impact 4,050 4,050 Health TF savings (under)/over target 98,879 (56.438) ICAP Co nt ribu tie n-liebilit y insurance 12,000 t2.000 Attachment A Cumulative Fy 04 Total Impact 269,942 575.657 · 025.625 1.070.425 These State funding reductions in credits are being passed on to property tax payers 1,799, t03 ~ .849.103 August 9th for position eliminations or 30 days after Council decision 1.929.103 I! you assume that 9 positions are cut and aren't placed thru retirements/attrition 1,95g~ 103 Assuming 3 retirements--Directed to extend offer until August 31~ 2003 1,963 153 2,032,032 Target of ~236.000,only came up with 9164.805 in '04 & $190.713 in '05 2,044,032 Billing received 4122/03 which is t20,O00 higher than FY 04 budget estimate Non-Union Wage Freeze City-wide {349.876) (355,187) 1,694.156 Expense Reductions That Do Not Involve Cutting City Positions in priority order with #1 2 t Police 2 3 Library 2 4 City Clerk 2 § City Manager 2 6 Emerg. Camm 2 7 City Manager 2 8 City Manager 2 9 Engineedng 2 10 Purch of Serv 2 11 Recreation 2 12 City Council 2 13 City Council 2 14 City Council 2 1E Legal Services 2 16 City Clerk 2 17 City Clerk 2 18 Annex Mainl 2 19 City Hall 2 20 City Hall 2 21 City Hall 2 22 Info Services being cut est. Soecialized police services overtime disc. (gl.736t {81 736) Reduce pmgrammm{~ by 47% for all (4.285) 14,285) 1.908.135 Eliminates staff support on CS tests (1,350) (1.350) 1.606,785 Sensitivity Training {3,000) (3,000) 1,603,765 Training expense for Ride-^longs (I ,665) (1,965) 1,602,120 Eliminate employees gifts (4,072) i4,072) 1.598.048 Wellness Programming (9,700) {9.7001 I,E98,348 Eliminates ~8,000 for overtime {8,000) {8.000) 1.580.348 Reduction in altec, by 7.8% (3.945} (3,945) 1.576.403 Eliminate Ice Rink Warming Houses (5,871i (5,871) 1.570.532 Eliminate Boards and Comm. Picnic (2,400) (2,400) 1.568.132 Reduce Travel Professional Conference (13.750) (13.750) 1,554.382 Sister City Program {2.000) i2.000) 1,552,382 Eliminated Education & Training 1.552,382 Eliminate microfilming/scanning {8.260) ~4,500) 1.644,122 Drop printing of Council Proceedings {1,190) (1,210) 1.542.932 Equipment Maint. Contract 1475) {475) 1.542.457 Reduced janitorial services {5.668) (11,336) 1.536.789 Reduce property maintenance {2,299) (2.298) 1.534.49~ Reduce operating supplies tl .oEgJ (1 .O59) 1,533,432 Reduce network maint to 8hfs/5 days {5,000) (5,000) t.528,432 1,612.420 STOP. Domestic Violence overtime, accreditation, Eliminates overtime for staff suoport. Dept staff and Commissioners would need to help Net savings (expense less 1/3 county reimbursement) SDiril luncheon Would continue with no gifts or service awards Lower priority tasks will be delayed One book would be provided to Library and one in City Clerk's Office Monday. Wed, and Friday janitorial service and restrooms on summer weekends GENERAL FUND Cat. Priority Dept 2 22 Ubrar¥ 2 23 Info Services 2 24 Hea~th 2 25 Health 26 Health 2 27 Info Services 2 27 Legal Services 2 28 Parks 2 29 Plannin~ 2 30 Planning 2 31 City Manager 2 32 Annex Maint 2 33 Annex Maint 2 34 Annex Maint 2 35 City Manager 2 36 Econ. Day 2 37 City Manager 2 38 City Manager 2 39 City Manager 2 40 City Manager 2 41 Emerg. Corem 2 42 Emerg, Mgmt 2 43 Finance 2 44 Finance 2 45 Health 2 46 Housing Serv 2 47 Human Rights 2 48 Info Services 2 49 Info Services 2 50 Recreation 2 51 City Manager 2 52 Police 2 53 Recreation 2 54 Police 2 55 Planning FY 04 Item Amount Reduce materials purchased 17.4% (45,575[ Renegotiated service contract (5.000) Eliminates ST for Animal Control Officer (1.494) Eliminates tamp clerical {885) Elimintes ST for Sanitarians {3.268) Uses comp time vs paid overtime (6,535) Splits health insurance between debts (4.30 I) Eliminate weekend overtime (7.860) Reduce times zoning map updated (2.000) Eliminate ECIA contracted services (12.000i Drop 25 Laserfiche view only licenses {1,980) Boiler Maintenance (4§0) Property Maintenance 12.088) Property Maintenance {615) Droo Dale Carnegie Training [3,431) Washington DC Initiative reduced | 13,218) Budget pdnting--4 copies only [5,300) Meals for budget hearing sessions, (2.650) Eliminate catering for meetings 12,500) Subscriptions Services-Personnel [2,000) CAD maintenance shifted to 911 Fund (15,3111 Increased fedora) funds (3.541) Monitor/Collect Loans Internally-CDBG 16.000) Recharge addl OH to parking (4,000) State reimbursement of activities (5.000) Shift vehicle expense.reduce supplies {2.200) Shift $10.000 salaries to HUD funding I10,000) Actual savings on SQL more than antic, (1,702) Emait management moved in house (13.055) Increase Admin. Overhead Chg to Golf (10,000) College Reimbursement Funds (7.400) Eliminates Graphic Artist positio~ [60,85g) CDBG funds r~av for 60% sw~m pass (13,528) Re)mb for tickets issued bv Police (20.O00) Eliminate staff membership in APWA (900) 17-Jul-2003 FY 05 Cumulative Amount Fy 04 Total Impact (45.875) 1,482,557 [5.000) 1.477,557 1,539) 1.476.063 (902) 1,475.178 13.400) 1,471.9t0 Limited after bour time spent on inspections 16.8351 1.465,075 (4.3011 1.460.774 Same amount of savings in Police {7.860) 1,452,914 {2,000) 1,450,914 (12,0OO} 1,438,914 (1,980) 1,430,934 Reduced from 50 to 25 and dropped 2 full licenses. (450) 1.436.484 Reduce boiler checks from weekly to every other week during heating seaso{~ (2,086) 1.434.396 Reduce nightly custodial service and preserve restroom and floor care nightly {615) 1.433.781 Reduce freouency of rug replacement servic from biweekly to montMy (3,431) 1,430.350 (13,218) 1.417,132 (5,360) 1,411,772 CD ROM available to public at cost (2,650) 1.409, 122 (2,500) 1.406.622 (2,000) 1.404.622 {15,311) 1,389.311 ~let savings (expense less 1/3 county reimbursement) {3,541) 1,385.770 {6.O00) 1,379,770 Revenue will go to Finance instead of to financial institution {4.000) 1.375.770 (5.400) 1,370,770 Activities performed will be reimbursed for FY 04 & 05 et min. (ia, bioterrorism) 12.200) 1.368.570 (10,000) 1.358 570 Housing cases would take priority (16,783) 1,343,810 {10.000) 1.333,810 17~4001 1.326.410 (60,555) 1.265.552 Funds publlc information personnel in Police and Fire with Cable Franchise fees {13,528) 1,252,024 (20,000) 1,232,024 (900) 1,231,124 Will maintain City Planner's membership Increase in Revenues by Department-~Not Priority 3 1 Building 3 2 City Clerk 3 3 Emerg. Comm 3 4 Engineering 3 5 Engineering Increase Business License Fees $20 charge for each tape made Adds traffic control permit fee 950 Increase 3ermit fee for dumpster (17,550) (4,950) (2.0001 (2.500) (5.850) {17,650) {12,900l (2,O00) (2,50Ol (5,85OI 1.213,474 Additional 925 per contractor license fee 1.208,524 Business licenses from $50 to $75, taxicab from $5 to 910 and add special event 1.206,524 1,204,024 %198,174 GENERALFUND Cat. Pdodty Dept 3 0 Engineering 3 7 Engineering 3 8 Fi~e 3 9 Fire 3 IO Five Flags 3 I1 Five Flags 3 12 Five Flags 3 13 Five Flags 3 14 Health 3 15 Health 3 16 Housing Serv 3 17 Legal Services 3 18 Library 3 19 Parks 3 20 Parks 3 21 Planning 3 22 Planning 3 23 Planning 3 24 Police 3 25 Recreation 3 26 Police 3 27 Recreation 3 28 Recreatio~ 3 29 Recreatior FY 04 FY 05 Cumu/atlve Item Amount Amount Fy 04 Total Increases license (1,800) (1,800) 1,196.374 increase Sidewalk Inspectfon fee 121,000) (21.0001 1.175.374 Adds $1.25/ capita cbarge for hazmat [33.321 {33.3211 1,142,053 Confined space charges to industries (4.500) (4.500) 1.137.553 Increase Labor Rates (4,865) 14.865) 1,132,688 Add $1.00 surcharge on tickets sold (34,500) (34.500) 1,098,188 Increases Public Skating Fees (2,050) (2.050) 1,096,138 Increase skate rental fee 81.00 to $1.50 (1,175) (1,175) 1,094,963 Incr. late penalty on dog/cat license (3,750) (3.750) 1,091,213 Increases dog/cat license fees {I0,841) (17,400) 1,080.372 Increase rental housing fees (3,595) {3,595) 1,076,777 Payment for Rd of Review tax appeals (10.000) (10,000) 1.066,777 Meeting room fees,interqibrary loan fee (4.300) (4.300) 1.062,477 Increase pavilion rental fees 15% (7.800) (7,800) 1,054.577 Increase camping fees (9.574] {9,574) 1.045,103 New billboard inspection fees 17~800~ (7,800) 1,037,303 Increase spec. exception/setback fee {2,800) (2,800) 1,034,503 Zoning fees increased in budget (58,620) (58,620} 975.883 New research fee for criminal checks (31,800) (31.8001 944,083 Impact of background check fee 1.000 1,000 945,083 Processing fee for impounded vehicles {20.400) (20,400) 924.683 ncrease Play Lot/Tot Lot fees by $5 14.000) (4.000{ 920,683 ncrease After School Sports fee by $3 (3.750) (3,750i 916.933 Increase ~'outh sports fees by 83.00 (2,610) (2,610) 914.323 17-Jul-2003 Revocable and irrevocable License processing fee for use of 9ublic rrght of way $50 if defect is found as Dart of inspection, 830 for sidewalk permit requested at Office Per capita for populatiol3 outside tile city vs currenttv flat fee to County of 86.000 From $3.50 to 84.00 for adults and $2.00 to $2.50 for youth ~- $2 for spayed/neutered (810), + $7 for non-spav/nonmeutered (825) From 88,50 to 89,00 per unit last increased in 1998 Should total 193.970 Impact of Police decision package From 810 to $18 Exoanditure Reductions That Involve Elimination of City Positions in priority order with #1 being cut last. Fire 2 Police 4 3 Police 4 4 Parks & 6 Library 4 7 Finance 4 8 Five Flags 9 Police 4 10 Parks 4 11 Engineering 12 Engineering 13 City Manager 4 14 Human Rights Eliminates 3 Fire Equip Operators Fire offer on Dental Insurance (10,667) (16.000) Fire offer on Comp time vs overtime (51.539) (51.539) Amount of needed to restore 3 ~osit~ons 128,738) {123,405) Freezes Traffic Safety patrol officer (60,989) (60,989) Canine officer itu rag. patrol. -1 officer 164.134) (64.134) Eliminate one park ranger 143.916) (43,919) Reduce Libraw hours from 69 to 64-65 (12.778) (12,778) Replace FT Fiscal Coord w PT (42.206) (42,206) Reduces Bldg Supv to pT (34,011) (34,011) F;eezes computer programmer (46,343) (46,343) Eliminate one maintenance worker (50.999) (50,699) Eliminate Traffic Engineer (56.982) (56,982) Freezes Eng g position (19,050) (19,050) Admin. Serv Mgr-;> Budget Director (18.135) (33,272) Eliminate Legal Intern, DDRC (13,872) (13.872) 914.323 903.656 852.117 723.379 662.390 598,256 554,340 541.562 Reduces Library hoursfmm 69 to 64 or 65 hm/week, no staffcuts, overtime reduced 499.356 PT Account Clerklforpayroll 465.345 358.303 Assigned to downtown 274,136 260,264 GENERALFUND Cat, Priority Del~t 4 1 § Police 4 16 Library 4 17 Legal Services 4 18 Finance 4 19 Engineering 4 20 Airport 4 21 Airport Item Eliminates civilian computer intern Cut Americorp program, outreach Eliminates Intern Eliminate Finance Intern Sbift funds/assignment of Eng II Savings used to hem cover NW rev. Eliminate LEO FT and PT positions TRANSIT FUND (part of General Fund tax asking shor~fag) 0 0 Transit City-wide 3 2 Transit Transit 3 3 Transit 2 I Transit State Transit Assistance reduction Non-union wage adjustments Increase Fares rag $1 to ~1.gO Charge for tours software maintenance Eaualize garage recharge rate Eliminate Fixed Route Saturday serv. ROAD USE TAX FUND 0 00per. A MaJnt. Increased health Costs 0 Use non-recurnng reserves in FY 04 and replenisb in FY 05 Total. Genera( Fund.Transit. RUTF FY O4 (11.887) (13,494) (7.008i (11.934) 18,315 (73.614) 22,049 30.778 (78.694) (0) FY 05 Cumulative Amount Fy 04 Total Impact (11.587) 248.677 {13.494) 236.183 (10,011) 228,175 14.000) 228.175 Keen in FY 04 due to GASB34 changes 18,315 234,556 Aimort reeuest to usa tlmse funds to halo address revenue shortfall due to Northwest (73,614} 160.942 8.000 160,942 {5.311) 160.942 (102,682) 160.942 (3.000) 160.942 22.049 182,991 {32.393) 182.991 ~ ~ 47.916 Impact of Operations and Maint. decision package 30.778 78,694 (16.447) 78.694 Unencumbered Funds--GeneralFund WATER OPERATING Categ Priority Dept 0 Water City-Wide 2 Finance 2 Water 2 Water 2 Water 3 Water Item Amounl Amount Increased health costs 28,028 28.O28 Non-union wage adjustments (16,757) {16.757) Lower Step due to retirement (1 ,O71 ) (1,07 ]) Reduce hydrant repLpmventive maint. (8,200) (8,200) Reduce consultant services tel to CIPs (2.O00) (2,000) Reduced water demand Duebecor 58.567 58.567 Rate adjustment relative to Quebecor (58,567) {58,567) Total. Water Operating Fund 0 O Fy 04 TRial Impact Savings in Finance offset by reduced recharges to the utgitfes Reduced cut from ~19.500 to $8,200 Rate Increase of 1.88% on too of 3% increased adonted by Council for FY 04 Use Water Operating fund balance until imoact of Ouebecor is more certain SEWER OPERATING Categ Priority Dept 0 ODer. & Maint City-Wide 2 Finance 2 WPC Planl 2 WPC Planl 2 WPC Plan1 FY 04 FY OS Cumulative Item Amount Amount Fy 04 Total Increased health costs Non-un(on wage adjustments Lower Star, due to retirement Reduce subscriptions/travel Rebidding shifta to reduce ST Renting oxygen generating system Tota[, Sewer Operating Fund 28,790 {17.409) {1,071) (20,322) {10.012) 28,790 (17,409) (1,071) (34.842) (24,532) Impact Savings in Finance offset bv reduced recharges to the utilities Can avoid this reduction of $2,475 Can avoid this reduction of $5,010 Equipment installation in FY 04 REFUSE OPERATING Categ Priority Dept Item 0 Spar. & Maint, Increased health costs CitY-Wide Non-onion wage adjustments Finance Lower Ste~ due to retirement Spar. & Maim, Increase fee from ~7.49 to $7.60/month Spar. & Maint. Increase appliance pickup fee ~10-:> ~14 TotaL. Refuse Collection FY 04 Amount 24,719 (2,608) (21.700) (O60) FY 0S Cumulative Amounl Fy 04 Total 24.719 (2,6081 (21,700) Impact Non-union wage adjustment missed on previous summary Savings in Finance offset by reduced recharges to the utigties Still 20% lower than the next lowest solid waster collection fee of other ten largest cities Can avoid this increase to generate $2,000 STORMWATER OPERATING Categ Pdodty Dept Item 2 Finance Lower Step due to retiremen! FY 04 Amount (1,071) FY OS Cumulative Amount Fy 04 Total (1,071) Savings in Finance offset by reduced recharges to the utilities TotaL. Stormwater Fund (1,07 f } I1,07 II LANDFILL OPERATING FUND FY 04 Categ Priority Dept Item Amount 0 Ooer & Malnt Increased health costs 10.765 10,765 City-Wide Non-union wage adjustments '6.520) (6,520) 2 Ooer & Maint Use Agency's FY 04 rate increase {4,245) (4,245) Total. Landfill Oper. Fund FY OS Cumulative Amount FY 04 Total 0 0 Impact Non-union wage adjustment missed on prewous summary No impact as covered by $.75 per ton fee increased already scheduled for 7-1-03 PARKING FY 04 Categ Priority Dept Item Amount Parking increased health costs 11,513 City-Wide Non*union wage adjustments (4,095) Parking Shortfall in revenues 30,000 Finance Recharge addl OH to parking 4,000 Parking Reimburse police for tickets written 20.000 Parking Eliminate a Maintenance worker [49,91 I} Parking Reduce Cashier hours .57 FTE I13.988) Total. Parking Oper. Fund {2,491) FY 05 Cumulative Amount Fy 04 Total (4,095) 30,000 4.000 20.000 (2,481) Impacl Non*union wage adjustment missed on previous summary 4th Street Ramp Look at rate increase decision packages in FY 05 if necessary. UDAG FUNDS Cate9 Priority Dept 0 Corem, Dev. City Wide 2 Parch of Serv FY 04 FY 05 Cumulative Item Amount Amount Fy 04 Total Increased heaRh costs Non-unmn wage adjustments Reduction in alloc, by 7.6%-Labor Mgmt Total. UDAG Fund 717 (2,187} (1,470) 717 12.167] {1,470) hnpact Non-union wage adjustment missed on previous summary Reduction no longer needed $717 COMMUNITY DEV. FUNDS Categ Priority Depl Item 0 City Wide City Wide 2 Econ. Dev. 2 Housing/CD Increased heagh COSTS Non-union wage adjustments Education and Tr~inlng Funds Rahab activity supplies reduced FY 04 2,799 8.000) FY 05 Cumulative Amount Fy 04 Total 12.799 Impact Reduction no longer needed ~2.600 Reduction no longer needed 81,470 2 Housing/CD 2 Housing/CD 2 Housing/CD Admin supplies and services General Liability Insurance Rental Unit Survey eliminated Total. Community Dev. Block Grant (6,701) [6.701} Reduction no longer needed $1.397 Reduced due to error in spreading costs Reduction no longer needed $6.000 LEAD PAINT PROGRAM Categ Priority Dept 2 Housing/CD Housing/CD Item Shift vehicle expense,reduce supplies Non-union wage adjustments FY 04 Amount FY 08 Cumulative Amount Fy 04 Total (3,616) (3,616) Impact Reduction no longer needed ~1.OOO Non-union wage adjustment missed on previous summary SECTION 8 HOUgING Categ Priority Dept Citv Wide Housing/CD 2 Housing/CD 2 Housing/CD 2 Housing/CD 2 Housing/CD 2 Housing/CD 4 Flousing/CD CABLE TV FUND Categ Priority Dept Cable TV Cable TV City Wide Annex Maint Coble TV Cable TV Cable TV Cable TV Cable TV City Managers FY 04 FY 05 Cumulative Item Amount Amount Fy 04 Total Increased health costs 13.853 13.853 Non-umon wage adjustments {13,343) (13,343) Reduce postage, more internet (500) (500) Staff to donate refreshments*FSS (200) (200) Mileage reduced, fewer visits ~590) (590) Reduced telephone long distance (700) 1700) Change background checks to latel 12,250) (2,2501 Impact of increase background checks 9,000 9.000 Total, Section 8 4,760 4,760 Item ncreased health insurance costs FY 2004 Operating Budget Surplus Non-union wage adjustments Property Maintenance Reduce membership expense Reduce Machinery/Equip. Rental FY 04 FY OB Amount Amount 7,015 7.015 (12,467) (12,467) {23,700) (23,700) Cumulative Fy 04 Total Impact Take min. amount we need to meet health insurance target Police $ I 0 fee for background checks Use fund balance to cover or alternate background check admin, policy Impact Estimate of FY 04/05 surplus $45.600/$42.000 but uncertain--negotiations in process. Non-union wage adjustment missed on 9revious summary Reduction no longer needed Reduction no longer needed Reduction no longer needed City Managers Eliminate Cit'! Expo Event City Managers Graphic Artist position eliminated Police Charge Pi function of Police & Fire (60,868] (60,858) 60,868 60,858 Total. Cable TV Fund (29,162) (29,152) 9ERVICE FUND Categ Priority Dept Item Engineering Increased heaRh costs-Engineering City Wide Non-union wage adjustments City Wide Reduce recharges based on Iowe~ rates Oper. & Maint, Increased hea~th costs-Garage Engineering Eliminate Traffic Engineering positio~ Engineering Shift funds/assignment of Eng g ODer. & Maint. Equalize 9arage rates for Transil Total Service Fund FY 04 FY 05 Cumulative Amount Amount Fy 04 Total 18 743 18,743 {33.7961 (33,796) 21.536 21.536 12.360 12,360 (8,727) (8.727) 11,934 11,934 {22,050) [22.050) 0 0 impact Non-u~lion wage adjustment missed on previous summary Increase recharges to projects and to garage recharges Attachment B Capital Projects that could be cancelled to support Fire and Park Ranger Positions in FY 2004 Only -- if Franchise Fees are not adopted Fire Department Amount Required to Fund 3 Fire Equipment Operators Less Amount Offered by Fire Union-dental & Comp Time Amount Required to Fund Park Ranger Amount Required to reinstate Saturday bus service and avoid fare increases Total Shortfall to be made up Cs pital Projects to be cancelled Historic District Grant balance from FY 03 Softball Fields at Vets Station #2 Driveway & Extedor Improv. Amount (19O.944) 62,206 (43,916) (135,075) (307,729) 139,450 139,500 28,779 Recurring savings Remaining in project $33,221 Total Capital Budget Reductions 307,729 MEM Attachment C ORANDUM July 15, 2003 TO: FROM: SUBJECT: Michael C. Van Mitligen, City Manager Pauline Joyce, Administrative Services Manager (SP~ / Summary of Information Developed to date on Gas and Electric Franchise Fees The purpose of this memorandum is to provide background information developed in response to City Council direction to continue to look into the alternative of a gas and electdc franchise fee. The first information presented in Attachment 1 ~s a comparison of State, City and School sales and local option taxes and franchise fees that would be paid by year for residential, commercial and tax exempt properties. This demonstrates the impact on each class of property if the City Council were to approve a 3% gas and electric franchise fee effective October 1,2003. It is important to look at the issue by class of property since the State's phase out of sales tax on gas and electric utilities applies only to residential properties. Upon enactment of a franchise fee, the City's local option sales tax and the School's local option sales tax would no longer apply to gas and electric bills. Highlighted in yellow are the changes in each of the taxes and fees and the final impact on the customer. The first sheet of Attachment 1 shows the impact on Residential Property in the City of Dubuque. Currently residential property owners are paying a 3% State Sales Tax, 1% City Local Option Tax and a 1% School Local Option Tax for a total of 5% tax on their electdc and gas bills, tfa 3% franchise fee is initiated effective October 1, 2003, the School and City Local Option Taxes will no longer apply and the qet effect ill be a 1% increase ~n taxes and franchise fees paid by the homeowner on their gas and electric bills or a total tax of 6%. Effective January 1, 2004 the State Sales Tax is reduced from 3% to 2% and the average homeowner will be paying 5% once more on these energy bills. This will continue to be reduced another 1% effective January 1, 2005 and 1% January 1,2006. From January 1,2006 and beyond, the total taxes and franchise fees for homeowners will be 3%. The second sheet provides the same information for commercial and industrial customers. Their taxes on energy bills are currently 7% including the 5% State Sales Tax, the 1% City Local Option Tax and the 1% School Local Option Tax. If the franchise fee goes into effect October 1,2003, their taxes and fee increase only 1% because the City and School Local Option Tax no longer apply. Their rates will not decrease over time as the State phase out of Sales Tax does not apply to commercial or industrial properties. The third sheet shows the im pact of a franchise fee on the tax exempt properties which are primarily the tax levying bodies, nonprofit educational institutions and state and federal government buildings. Also, commercial and industrial is exempt from sales tax on electricity and gas used in processing. The impact on the sales tax exempt properties is 3% effective October 1, 2003 and beyond. Attachment 2 quantifies the estimated revenues that could be generated from a 3% gas and electdc franchise fee. This summary indicates that a gas and electric franchise fee would generate an estimated $1,081,997 for the General Fund operating budget for Fiscal Year 2004 and $1,622,184 in Fiscal Year 2005 (full year versus 2/3 of a year). It is also important to note that the franchise fee alternative does reduce capital budget resources by an estimated $324,437 due to the loss of the Local Option Sales Tax. Attachment #3 takes the estimated amount of revenue generated by a 3% franchise fee if it were to go into effect September 1,2003 and applies that revenue to the recommended operating budget cuts that came out of the July 9 public hearing. The funding was used to restore the following decision packages: · non-unionwage plan, · avoids unemployment, outplacement, and impact of one month lag in position cut · all education and training accounts, · $4,165 of the total $81,736 of overtime for STOP, Domestic violence and other specialized police services overtime · Purchase of Services 7.6% proposed cut · Restores $4,000 in Library materials · Overtime for Environmental Sanitarian · New research fee for criminal checks · Three Fire Equipment Operator positions · Traffic Safety patrol officer · Canine officer · ParkRanger position · Library. hours from 64 back to 69 (current level) · Five Flags Building Supervisor back to FT · Police Computer Programmer position · Parks Maintenance worker assigned to downtown · Traffic Engineer · Engineering Assistant II · Legal Intern · Computerlntern in Police · Amedcorp program and other Library outreach programs · Legal Services Intern · Finance Intern · Transit Saturday service restored and avoid fare increases · Charges for tours for other City departments As noted above, this alternative does not require reductions in the Fire, Park and Historic District Grant capital improvement programs to balance the operating budget for FY 04. Since FY 05 franchise fees will be for a full year versus % of a year, the revenue generated in FY 05 will result in an additional $392,871 of franchise fee revenues available to address FY 05 budget difficulties, such as the anticipated 10.54% property tax increase. If this amount were applied to reducing the FY 2005 property tax requirements, the anticipated residential property tax increase would be reduced to 8.05%. Attachment I FRANCHISE FEE REVENUE SalesTaxand PotentialFranchiseFeeson ResidentialGasand Electric Bills within CityLimits City School Calendar Year State Tax Local Option Local Option 2001 5.00% 1.00% 0.00% 2002 4.00% 1.00% 0.00% 2003 Jan.-June 3.00% 1.00% 0.00% Franchise Fee 3.00% 3.00% 3.00% 3.00% 17-Jul Impact on City Residents 6.OO% 5.00% 4.00% FRANCHISE FEE REVENUE Sales Tax and Potential Franchise Fees on Commercial and Industrial Gas and Electric Bills within City Limits City School Calendar Year State Tax Local Option Local Option 2002 5.00% 1.00% 0.00% 2003 Jan.-June 5.00% 1.00% 0.00% Franchise Fee Impact on Comm./Ind. 6.00% 6.00% 2004 and beyond 5.00% 5,00% 3.00% Any electricity or natural gas used in processing is exempt from sales tax, but not exempt from the franchise fee 8.00% FRANCHISE FEE REVENUE Sales Tax and Potential Fra,~chise Fees on Sales Tax Exempt Properties within City Limits Calendar Year 2002 City School Franchise Impact on State Tax Local Option Local Option Fee Tax Exempt 0.00% 2004 and beyond 3.00% 3.00% Sales tax exempt includes private nonprofit educational institutions nonprofit private museums [ax-certifying or tax-levying body or governmental subdivision, including state board of regents, state department of human services, state department of transportation, all divisions, boards, commissions, agencies, or instrumentalities of state federal, county or municipal government which do not have earnings going to the benefit of an equity investor or stockholder, Any electricity or natural gas used in processing is exempt from sales tax, but not exempt from the franchise fee Attachment 2 Residential Commercial Industrial Utilities/Other Aquila Rev. by Soume 69.00% 28.00% 3.00% Total 100.00% Revenue from 3% 750,000 Loss of Sales Tax Revenue in General Fd Operating Budget (125,000) Capital Budget (125,000) Net Gain in Revenue Overall Net Gain in Revenue for Operating budget Net Loss i~ Revenue into Capital budget AIliant Rev. by Soume 40.50% i 6.00% 42.60% 0.90% 100.00% 1,196,621 (199,437) (i99,437) FRANCHISE FEE REVENUE Average by Source 54.75% 22.00% 22.80% 0.45% Total Total Total Taxable Value-FY 04 49.00% 40.OO% 5.00% 6.00% 100.00% 1,946,621 (324,437) (324,437) 1,297,747 1,622,184 (324,437) Impa~ FY 2004 Effective Date Oct. 1 1,298,396 (216,399) (210,399) 865.597 1,081,997 (216,399} Impact FY 2005 1,946.621 (324,437) (324,437} 1,297,747 1,622,184 (324,437) SUMMARY OF DECISION PACKAGE9 BY FUND PER ADOPTED AMENDMENT GENERAL FUND FY 0~- FY 09 Cat, Pdorlty Dept Item Amount Amount 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 City-wide City-wide City-wide City-wide CRy-wide City-wide City-wide CRv-wide City-wide ,CRy-wide City-wide City-wide Linuor Sales Tax Credit 269,942 269,942 Municipal Assistance 306,715 305,715 Personal Property Tax Replacement 449,968 449,968 Monies and Credit Replacement 44.800 44.800 Homestead Tax Credit change Impact of health cost increases 413,678 413,678 Hiring freeze/confined space revenue 315.000 315,000 Retirement Incentive 30,000 Health TF savings (unded/over target 68,879 (56,438) ICAP Contribution-liability insurance 12,000 12.000 Non-Union Wage Freeze Expense Reductions That Do Not Involve Cutting City Positions in priority order with #1 being cut last. 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 3 Library 4 City Clerk 5 City Manager 6 Emerg. Corem 7 City Manager 8 City Manager 9 Engineering Reduce programming by 47% for 811 (4,285) (4,285) Eliminates staff support on CS tests (1.380) (1,350) Sensitivity Training {3,0001 {3,000) Training expense for Ride-Alongs (1,665) (1,665) Eliminate employees gifts (4,072) (4,072) Wellness Programming (9.700] (9.700) Eliminates $8.000 for overtime (8,000) [8.000) 11 Recreation 12 City Council 13 City Council 14 City Council 15 Legal Services I0 City Clerk 17 City Clerk ~8 Annex Maint 19 City Hall 20 City Hall Eliminate Ice Rink Warming Houses (5,871) (5,871) Eliminate Boards and Comm. Picnic (2,400) (2,400) Reduce Travel Professional Conference (13,750) (13,750) Sister CRV Program (2.000) {2,000) Eliminated Education & Training Eliminate microfilming/scanning 18.260) 18.260) Drop printing of Council Proceedings (1,1901 {1,190) Enuipment Maint. Contracl (475) (475) Reduced janitorial services IS,66g) [5,988) Reduce property maintenance {2.298) (2.298) Attachment Cumulative Fy 04 Total Impact 269.942 575,657 1.025.625 1.070,425 1,070,425 These State funding reductions in credits are being passed on to property tax payers 1,799,103 1,799,103 August 9th for position eliminations or 30 days after Council decision 1,799,103 If you assume that 8 positions are cut and aren't placed thru retirements/attrition 1.829,103 Assuming 3 retirements-Directed to extend offer until August 31, 2003 1,897.982 Target of ~236,000,only came up with $184.805 in 'O4 & $190,713 in 1.909,982 Billing received 4/22/03 which is ~20,000 Idgher than FY 04 budget estimate 827,985 870,185 Restores Education and Training Solit savings Police OT and Library Materials 870,185 Committment b¢ Council to look at reinstating this next year. Staff directed to come back to Council with information on utility franchise fee process. 792,614 Restores 84.165 of the 981,736 overtime for STOP. Domestic violence, accreditation 788.329 786.979 783,979 782.314 778,242 768,542 760,542 760,542 754.671 752,271 735,521 Restores 50% of Travel Professional Conference expense. Cost share on expense 736,521 736.821 Don't eliminate this training Impact is 9962 728.261 Eliminates intern to scan records and microfilming of Council records. 727.071 One book would be provided to Library and one in City Clerk's Office 726,596 Reduce regular elevator testing and prey. malnt, from monthly to every two months 720.928 Monday, Wed. and Friday janltodal service and restrooms on summer weekends 718,630 Group replace ballasts defer maintenance if necessary on other items Lower priority tasks will be delayed SUMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT GENERAL FUND FY 04 Cat, Priority Dept Item Amounf FY 05 Amounl Cumulative Fy 04 Total Impact 21 City Hall Reduce operating sure,lies 11.059) (1.059) 22 Info Services Reduce network maint to 8hrs/§ days (S.O00) (5,O001 23 Info Services Renegotiated service contracl (5,000) [5.000J 24 Health Eliminates eT for Animal Control Officer (1.494) (1,539) 25 Hea~th Eliminates tamp cmdca; (88~) (902) 2 2 2 2 2 2 2 2 27 info Services 2 27 Legal Services 2 28 Parks 2 29 Planning 2 30 Planning 2 31 City Manager 2 32 Annex Maint 2 33 Annex Maint 2 34 Annex Maim 2 35 City Manager 2 36 Econ, Dev 2 37 City Manager 2 38 City Manager 2 39 City Manager 2 40 City Manager 2 Al Emerg. Camm 2 42 Emerg. Mgmt 2 43 Finance 2 44 Finance 2 45 Health 2 46 Housing Berv 2 47 Human Rights 2 48 Info Services 2 49 info Services 2 50 Recreation 2 51 City Manager 2 52 Police 2 53 Recreation 2 54 Police 2 55 Planning Uses comp time vs paid overtime (6.835] (6.835) Splits health insurance between depts {4.301 (4.301) Eliminate weekend overtime (7,860) (7.860) Reduce times zoning map updated (2,000) Eliminate ECiA contracted services (12,000) (12,000) Drop 25 Laserfiche view only licenses (1,980) (1,980) Boiler Maintenance 1450) (450) Property Maintenance {2.088) (2.088) Property Maintenance (615} (61 Drop Dale Carnegie Training (3.431) (3,431) Washington DC initiative reduced (13,218) (13,218) Budget printing--4 copies only (5,360) (5,360) Meals for budget hearing sessions {2,650) (2.650) Egminale catering for meetings [2,600) (2.5OO} Subscriptions Services-Personnel 12.OOO) (2,000) CAD maintenance shifted to Bll Fund (15.311) (15.311) Increased federal funds (3,541) (3.541) Monitor/Collect Loans lnternally-CDBG (6,000) (6,000) Recharge addl OH to parking 14.OO0) (4,000) State reimbursement of activities (5.000) (5.400) Shift veidcle expense.reduce supplies (2,200) (2,200) Shift 810,000 salaries to HUD funding (10.000) {10.000) ActuaJ savings on SOL more than antic. (1,702) {1 702) Email management moved in hOUSe {13,056) (I 6,783) ncrease Admin. Overhead Chg to Golf (1 O.000) I0.000] College Reimbursement Funds (7,400) {7.400] Eliminates Graphic Artist oosition (60,858) (B0,8§8) CDBG fm3ds pay for 50% swim pass (13,528) (13.528) Reimb for tickets issued by Police 120.000) (20.OOO) Eliminate staff membersl]ip in APWA 1900) (900) 717,571 712.571 670,696 665.696 664.202 663,317 663.317 656.482 652,181 644,321 642.321 630.321 628,341 627,891 625,803 625.188 621.757 608.539 Restores $4,000 of proposed 945,875 cut Limited after hour time spent on inspections Same amount of savings in Pogce Reduced from 50 to 25 and dropped 2 full licenses. Reduce boiler checks from weekly to every other week during heating season Reduce nightly custodial service and preserve restroom and floor care nightly Reduce frequency of rug replacement servic from biweekly to monthly 603.179 CD ROM available to public at cost 600.529 598,O29 596,029 580.717 Net savings {expense less 1/3 county reimbursement) 577 176 571,176 Revenue will go to Finance instead of to financial institution 567,176 562.176 Activities performed will be reimbursed for FY 04 & 05 at min. (ia. bioterrorism] 559,976 549,976 Housing cases would take priority 548.274 535,216 525,216 517.816 456.958 Funds public information personnel in Police end Fire with Cable Franchise fees 443.430 423.430 422,530 Will maintain City ~lanner's membership increase n Revenues by Department--Not Priority 3 1 Building Increased contractor license fees 3 2 City Clerk Increase Business License Fees (17,650) {17.650) (4,950) 112.900) 404.880 Additional ~25 per contractor license fee 399,930 Business gcenses from 950 to 975. taxicab from 95 to $ fO and add special event SUMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT GENERAL FUND Cat. Priority Dept Item FY 04 FY 05 Cumulative Amount Amount Fy 04 Total Impact 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 Emerg. Corem 4 Engineering § Engineering 8 Engineering 7 Engineering 8 Fire 9 Fire I0 Five Flags 11 Five Flags 12 Five Flags 13 Five Flags 14 Health ! 5 Health )g Housing Serv )7 Legal Services 18 Library 19 Parks 20 Parks 21 Planning 26 Police 27 Recreation 28 Recreation 29 Recreation $20 charge for each tape made (2,000i 12.000] Adds traffic control permit fee $50 {2,800) (2.5001 Increase I~ermit fee for dumester (5,850) (8,850) Increases license (1,800) (1.800) Increase Sidewalk inspection fee (21.000) (21.000) Adds $1.25/ capita charge )or hazmat (33,321 (33,321) Confined space charges to industries )4.5001 (4,§00) increase Labor Rates {4,8651 {4,865) Add 81.00 sumharge on tickets sold (34,500] {34.500) Increases Public Skating Fees (2.0§0) 12.050) Increase skate rental fee 81.00 to $1.50 {1.175) 1,175} Incr. late penalty on dog/cat license {3,750) 13.7§0) Increases dog/cat license fees (10,841) (17,400) Increase rental housin~ fees (3,595) (3,595) Payment for Bd of Review tax appeals (10,000) (10,0001 Meeting room fees.interqibrary loan fee (4,300) 14,300) Increase pavilion rental fees 15% (7,800) 17.800) Increase campm~ fees (9,§74) {9,574) New billboard inspection fees {7.800) (7,600) Increase spec. exception/setback fee 12.800) {2,800) Zoning fees increased in budget (58,620} las.620) Processing fee for/reDounded vehicles (20,400) (20.400) Increase Pla,/ Lot/Tot Lot fees bv 85 (4,000) 14.000) Increase After School Sports fee by 83 (3.750) (3,750) increase youth sports fees bv ~3.00 (2.610} (2.610) 17-Jul-2003 397.930 395.430 389,580 387,780 366.780 333.459 328.959 324,094 289,594 287,544 286,369 282.619 271,778 268.183 258,183 253,883 Should total193.970 246.083 236,509 228.709 225.909 167,289 167,289 167.289 Impactof Police decision package 146.889 142,889 From ~lOto ~18 I39,139 136.529 Revocable and irlevocable License processing fee for use of public right of way $50 if defect is found as part of inspection. ~30 for sidewalk permit requested at Office Per capita for population outside the city vs currently flat fee to County of 8g,O00 From ~3.50 to ~4.00 for adults and ~2.00 to 82.50 for vouth + 82 for spayed/neutered [~ 10}. + s7 for non-spay/non-neutered [82]5) From 88.§0 to ~9.00 per unit. last increased in 1998 Expenditure Reductions That Involve Elimination of City Positions in priority order with #t being cut lest. Replace FT Fiscal Coord w PT (42,206) (42,206) 136.529 74,323 74.323 74.323 74,323 74,323 32,117 PT Account CIerklforpayroll 32,117 32,117 Asslgnedto downtown 32,117 suMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT GENERAL FUND FY 04 FY og Cat. PrlorRy Dept Item Amount Amount 4 4 4 4 4 4 4 4 4 13 City Manager 14 16[ 21 Airport Admin. Serv Mgr->Budget Director (18,135) (33,272) Eliminate LEO FT end PT positions TRANSIT FUND (part of General Fund tax asking shortfall) O O Transit State Transit Assistance reduction 1 3 {73.614J {73,614) 8000 8,000 3 3 Transit Equalize garage recharge rate 22,049 22,049 2 Cumulative Fy 04 Total Impact 17-Ju[-2003 13,982 13,982 13,982 13,982 13,982 13,982 Keepin FY 04 dueto GASB34 changes 13,982 13,982 Airportrequestto usethesefundsto help address mveuue sho[tfalldue to Northwest {59,632) (51,632) (51,632) {51,632) (31,583)lmpactof Operations and Maint. decision package ROAD USE TAX FUND 0 00~er. & Maint. Increased health costs 30.778 30,778 0 Use non-recurring reserves in FY 04 and replenish in FY 08 TotaL. General Fund,Transit, RUTF O (732,670) SUMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT WATER OPERATING Categ Priority Dept 0 Water City-Wide 2 Finance 2 Water 2 Water 2 Water 3 Water Item Amount Amounl Increased healtb costs 28.028 28.028 Lower Step due to retirement (1.071) { 1 ,O71) Reduce consultant services roi to CIPs 12.000I {2,000) Reduced water demand Ouebecor 58.567 58.667 Rate adjustment relative to Ouebecor 158.567) (58.567) Total. Water Operating Fund 5,457 5.457 Fy 04 Total Savings in Finance offset by reduced recharges to the utilities Rate increase of 1,68% on tod of 3% increased adopted by Council for FY 04 Use Water Operating fund balance until impact of Quebecor is more certain SEWER OPERATING Categ Priority Dept 0 Oper. & Maint City-Wide 2 Finance 2 WPC Plant 2 WPC Plant 2 WPC Plant FY 04 FY 0S Cumulative Item Amount Amount Fy 04 Total Increased health costs 28,790 28,790 Lower Step due to retirement (1,071) (1,071) Renting oxygen generating system 120.322} {34.842) Total. Sewer Operating Fund (694) (7.123) Impact Savings in Finance offset bv reduced recharges to the utilities Can avoid this reduction of $2.475 Can avoid this reduction of $5.61S Equipment installation in FY 04 REFUSE OPERATING Categ Priority Dept 0 ODer, & Maim. City-Wide 2 Finance 3 Oper. & Maint, 3 O~er. & Major, Item FY O4 Amount FY OS Cumulative AmounI Fy 04 Total Increased health costs 24,719 24.719 Lower Step due to retirement (1,071) (1,071) Increase fee from 87.49 to ~7.60/month (21,700) (21,700) Increase appliance oickup fee $10- > $14 Total. Refuse Collection 1.948 1,948 Savings in Finance offset bv reduced recharges to the utilities Still 20% fewer than the next lowest solid waster collection fee of other ten largest cities Can avoid tbis increase to generate ~2,O00 STORMWATER OPERATING Categ Priority Dept Item 2 Finance Lower Step due to retiremenl FY 04 Amount (1,071) FY 05 Cumulative Amom~t Fy 04 Total {t,07t) Impact Savings in Finance offset by reduced recharges to the utilities SUMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT Total. Stormwater Fund 1.071 ) ( 1,071) LANDFILL OPERATING FUND Categ Prlodty Dept Item FY 04 FY 05 Cumulative Amount Amount Fy 04 Total Oper & Maint Citv-Wide ODer & Malnt Increased health costs 10,765 10,765 Non-union wage adjustments Total. Landfill Oper. Fund 0 O No impact as covered by 9.75 per ton fee increased already scheduled for 7-1-O3 PARKING Categ Priority Dept 0 Parking City-Wide 0 Parking 2 Finance 3 Parking 4 Parking 4 Parking FY 04 FY 05 Cumulative Item Amount Amoun! Fy 04 Total Increased health costs 11,513 11,513 Shortfag in revenues 30.000 30.000 Recbarge addl OH to parking 4.000 4.000 Reimburse police for tickets written 20,000 20,000 Eliminate a Maintenance worker (49,911) (49,911) Reduce Cashier hours .57 FTE (13.988) {13,988) Total, Parking Opar. Fund 1.614 1,614 Impact 4th Street Ramp Look at rate increase decision packages in FY 05 if necessary. UDAG FUNDS Categ Priority Dept 0 Comm Dev. City Wide 2 Purch of Serv Item Increased heaRh costs FY 04 Amount 717 FY 05 Cumulative Amount Fy 04 Total 717 TotaL. UDAG Fund 0 O Impact Reduction no longer needed $717 COMMUNITY DEV. FUNDS Ceteg Priority Dept Item 0 City Wide City Wide 2 Econ. Dev. 2 Housing/CD Increased health costs FY 04 Amount 12,799 FY 0S Cumulative Amount Fy 04 Total 12,799 Impact SUMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT 2 Housing/CD /~ l;I ~ih ~ ~ L~ j~ j~Ji~'~~~~ g{~ 2 Housing/CD General Liability Insurance (1.500) (1.500) 2 Housing/CD ~P~ ~L U~¢~ ~ ~l~qt ~g~¢~~~ Total. Community Dev, Block Grant Reduced due to error in spreading costs LEAD PAINT PROGRAM Categ Priority Dept 2 Housing/CD Housing/CD FY 04 FY OS Cumulative Item Amount Amount Fy 04 Total Shift vehicle exoense,reduce supplies Impact SECTION 8 HOUBING Categ Priority Dept City Wide Housing/CD 2 Housing/CD 2 Housin0/CD 2 Housing/CD 2 Housing/CD 2 Housing/CO 4 Housing/CD CABLE TV FUND Categ Priority Dept O Cable TV 0 Cable TV City Wide 2 Annex Maim 2 Cable TV 2 Cable TV 2 Cable TV 2 Cable TV 2 Cable TV 2 City Managers FY 04 FY 0E Cumulative Item Amount Amount Fy 04 Total Increased health costs 13,853 13.853 Reduce Dostage, more internet (500) (5OO) Staff to donate refreshments-FSS (200) (200} Mileage reduced, fewer visits (590) (590) Reduced telephone long distance (700) (700) Change background checks to later (2,250) {2.250) redact of increase background checks Total, Section 8 9,613 9.613 FY 04 FY 05 Cumulative Item Amount Amount Fy 04 Total ncreased health insurance costs 7.015 7,O15 FY 2004 Operating Budget Surplus {7,01§) (7,015] Property Maintenance qeduce membership expense Reduce Machinery/Equip. Rental Eliminate Promotional activities Reduce Subscriptions Reduce Subscriptions Impact Police 910 fee for background checks Impact Estimate of FY 04/05 surplus $45.600/~42,000 but uncertain--negotiations in process, Reduction no longer needed Reduction no longer needed Reduction no longer needed Reduction no longer needed Reduction no longer needed Reduction no tonger needed City Focus to be insert in utility bills (quarterly) SUMMARY OF DECISION PACKAGES BY FUND PER ADOPTED AMENDMENT City Managers Eliminate City Expo Evenl City Managers Graphic Artist position eliminated ¢60,8581 (60,858} Police Charge PI function of Police & Fire 80.858 00,858 Total, Cable TV Fund 0 0 Position and related supplies and services $60.858 SERVICE FUND Categ Priority Dept FY 04 FY 0§ Cumulative Item Amount Amount Fy 04 Total Engineering Increased health costs-Engineering 18,743 18.743 City Wide Reduce recharges based on lower rates Oper, & Maint. Increased health costs-Garage 12,360 12,360 Engineering Eliminate Traffic Engineering position (8,727) (8,727) Impact Non-union wage adjustment missed on previous summary Increase recharges to projects and to garage recharges