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Agenda: 14-97
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City Commission
Special Meeting,
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7-14-97
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• Clearwater City Commission Item #: {
' Agenda Cover Memorandum '
Meeting Date: '
SUBJECT:
MILLAGE RATE FOR FISCAL YEAR 1997/98
RECOMMENDATION/MOTION:
Adopt a tentative millage rate of 5.1158 mills for fiscal year 1997198 and set Public Hearings on the Budget for
September 4, 1997 and September 18, 1997 to be held no earlier than 6:00 p.m.,
® and that the appropriate officials be authorized to execute same.
BACKGROUND:
In accordance with the TRIM Bill process it is necessary for the City Commission to adopt a tentative millage rate
prior to finalizing and adopting the Budget. The tentative millage rate will be included in the TRIM Bill notices
sent to taxpayers in early August and cannot be increased without special mailing.
The City Manager's recommended millage rate of 5.1158 mills is the same millage rate as adopted for the current
year. The rolled back rate, according to State definition, is the millage rate which exclusive of new construction,
additions to structures, deletions, and property added due to geographic boundary changes, will provide the same
ad valorem tax revenue as was levied the prior year. If the recommended rate of 5.1158 mills is adopted, the
City's' .ordinance adopting the millage rate will reflect a 2.23% increase over the rolled back rate of 5.0044 mills.
To summarize the effect of the recommended increase of 5.1158 mills on an individual Clearwater taxpayer:
• If an individual's property tax value has not increased (i.e., no reassessment), there would be no
increase in Clearwater's share of property tax.
• If an individual's tax value has increased (i.e. reassessment), the tax increase would be the same
percentage increase (a 3% increase in value would result in a 3% increase in Clearwater's share of
property taxes)
This will be the seventh consecutive year in which the millage rate will remain at 5.1158 mills, and it has been
eight years ( FY 1990191) since the City has last increased the millage rate. We have added many new programs
over the past several years including, but not limited to, the Office of Tourism Development, the Community
Response Team, and Community Outreach. These three programs alone have impacted the General Fund budget
at a cost of just over $2 million annually. As we move into the next fiscal year, our focus will be on
implementation and promotion of the City's vision and the first of a three year management review of City
operations. Any costs associated with these efforts will require serious consideration as we determine the effect on
future operating budgets.
Reviewed by: Originating Department: Costs: Commission Action:
Legal NIA office of Management NIA ? Approved
Budget and Budget Total ? Approved w/Conditions
Purchasing IA User Department: ? Denied
Risk Mgmt. NIA Current Fiscal Year ? Continued to:
IS NIA Funding Source:
ACM ? capilallmprovemrnll
Other NIA Advertised: ? operating:
Date: ? 01her: Attachments:
Paper;
Submitted b : ? Not Required Appropriation Code
Affected P rties:
Notified ? None
City Manage 0 Not Required
0 Printed on recycled paper
Y
GENERAL FUND
STATEMENT OF REVENUES AND EXPENDITURES
ACTUAL BUDGET ADJUSTED RECOMMENDED
FY 95/96 FY 96197 FY 96197 FY 97198
BEGINNING FUND BALANCE 12,173,137 10,209,898 10,289,898 8,573,563
REVENUES:
Property Taxes 19,482,181 19,824,890 19,824,890 20,366,810
Sales Tax 4,302,831 4,532,590 4,475,000 4,913,920
Franchise Fees 7,082,847 7,451,180 7,527,950 7,750,730
Utility Taxes 13,351,614 13,982,880 13,982,880 14,739,970
Licenses & Permits 2,435,798 2,432,000 2,528,000 2,688,100
Fines, Forfeitures & Penalties 1,210,792 1,434,000 1,211,500 1,312,700
Intergovernmental Revenues 7,260,232 7,367,700 7,665,170 7,837,760
Charges for Current'Services 1,066,848 1,610,240 1,458,445 1,527,940
Use/Sale of City Property/Money 1,245,583 1,811,800 1,422,170 1,456,700
Miscellaneous Revenue 121,330 106,680 90,280 140,320
Interfund Charges/Transfers 8,945,035 9,778,230 9,873,230 9,969,360
Transfer from Surplus 0 500,000 1,716,335 427,210
TOTAL'REVENUES 66,505,091 70,732,190 71,776,850 73,031,520
EXPENDITURES:
Commission 193,226 201,880 272,120 205,380
Administration 2,434,938 2,967,940 2,983,673 3,249,660
Legal 960,063 1,075,650 1,074,880 1,1 17,920
City Clerk 623,225 675,720 687,490 777,770
Info Mgmt/Community Outreach 520,468 626,920 626,920 693,960
Finance Department 1,275,843 1,340,090 1,365,570 1,450,390
Human Resources 715,101 723,330 755,120 774,710
Police 21,415,885 23,769,360 23,780,010 23,980,120
Fire 10,027,149 10,779,070 10,760,900 11,217,920
Mousing & Urban Development 402,408 449,770 449,770 467,130
Central Permitting 1,885,604 1,864,760 1,912,260 2,088,460
Engineering Department 4,714,986 5,051,230 4,999,560 4,932,180
Public Services 1,610,308 1,665,660 1,665,660 1,707,710
Parks & Recreation 9,760,786 10,380,010 10,411,291 10,852,510
Library 3,911,994 4,187,130 4,201,050 4,289,950
Sailing Center 119,882 124,480 124,480 127,420
Pier 60 348,779 269,780 269,780 261,170
Non-Depart mental 7,467,685 4,579,410 5,435,316 4,837,160
TOTAL. EXPENDITURES 68,388,330 70,732,190 71,775,850 73,031,620
To/From Unappropriated
Retained Earnings
0 -500,000 -1,716,335 -427,210
TOTAL ENDING FUND BALANCE 90,289,898 9,789,898 8,573,663 8,146,353
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Interoffice Correspondence Sheet
To: Michael Roberto, City Manager
From: Tina Wilson, Budget Director
CC: Kathy Rice, Deputy City Manager
Bob Keller, Assistant City Manager
Date: July 11, 1997
RE: Preliminary 1997198 Budget
The following highlights will provide background for discussion with the City Commission
regarding the Preliminary 1997198 Budget and the establishment of the TRIM rate on Monday.
Most of this information has been provided to you in a previous memo.
Funding the "Vision"
The preliminary budget includes funding of a 1 million contingency to support the City's
"Vision" and an additional $250,000 for a management audit to be phased over a two year
period. The one-time funding for the management audit ($250,000) and approximately
$177,210 of the vision contingency will be provided by the appropriation of $427,210 ( the
equivalent of 1110 of a mill) from the unappropriated retained earnings of the General Fund.
Millage Rate
The "rolled back rate", which is the millage rate that would provide the same tax revenue to
the City as in the prior year, is 5.0044 mills. If the millage rate for FY 1997198 is set at the
same 5.1158 mills as the current year, this would be an increase of 2.23 % over the roll back
rate, and this increase would be
Because our tax values have increased for FY 1997198, we will need to advertise a "Notice of
Proposed Tax Increase", but this only compares the previous year's tax levy to the proposed
tax levy. It does not specifically address any percentage increase in the millage rate, only the
additional tax levy dollars that we will receive in comparison with the current fiscal year.
The second advertisement is the "Budget Summary". This ad will address the % increase of
total budgeted expenditures across all funds compared to the current year's operating budget.
This increase should be approximately 2.4% for advertising ilumoses,
General Fund Retirements
The preliminary budget does not include any funding for the General Fund retirement pool. We
will need to do some additional analysis to determine the total anticipated funding needs for FY
1997198. We will fund this need at third quarter of the current year from the unappropriated
surplus of the General Fund at an estimated cost of $500,000. We will be analyzing the cost will
be for future budget years, and developing a plan as to how we will address this issue in future
budgets.
General Fund-Surplus
The proposed budget anticipates the funding of $427,210 ( the equivalent of 1110 of a mill)
from the unappropriated retained earnings of the General Fund for one-time funding for the
management audit ($250,000) and approximately $177,210 of the vision contingency.
In addition, the preliminary budget does not include any funding for the General Fund
retirement pool. We will fund this cost at third quarter of the current year from the
unappropriated surplus of the General Fund at an estimated cost of $500,000.
With the appropriation of this additional $927,210, the Unappropriated Retained Earnings of
the General Fund will be approximately $7.646.350 on October 1, 1997. This is
approximately 10.5 0 of the proposed General Fund _operating-budget.
Personnel Costs
The preliminary budget, includes cost of living adjustments (cola) of 2%. Historical annual
salary increases in comparison with the preliminary budget are offered below:
FY 1994195 4% cola 2.8% step increase
FY 1995196 3% cola 2.8% step increase
FY 1996/97 3% cola 2.8% step increase
Proposed FY 1997198 2% cola 2.8% step increase
The CPI index for wage earners for FY 1996 was 2.9 %, but remember that many of our union
employees receive step increases along with the cost of living increase. Human Resources has
estimated that the following employees will receive some level of step increase along with the
cola in 1997:
CWA Employees 61%
IAFF 39%
FOP 10 63%
Sgts & Lts 58%
Avg all Unions 59%
Salary Savings
The preliminary budget includes a 2.5% salary savings. Based upon historical data, most
departments achieve a 1.5 % salary savings on an annual basis. By requiring a 2.5 % salary
savings, this may necessitate a delay in hiring some employee replacements, but it will also offer
the opportunity to prioritize our needs and possibly allow for some reorganization.
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