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08-26-2009 VC B WS-MMINUTES OF THE BUDGET WORKSHOP SESSION VILLAGE COUNCIL OF NORTH PALM BEACH, FLORIDA • AUGUST 26, 2009 Present: David B. Norris, Mayor William Manuel, Vice Mayor Darryl Aubrey, Sc.D., President Pro Tem Edward M. Eissey, Ph.D., Councilman T.R. Hernacki, P.E., Councilman Jimmy Knight, Village Manager Melissa Teal, CMC, Village Clerk ROLL CALL Mayor Norris called the meeting to order at 7:00 p.m. All members of Council were present. All members of staff were present, except the Village Attorney. Finance Director Samia Janjua, Community Development Director Chuck Huff, Human Resources Director Mary Kay McGann, Information Technology Director Michael Applegate, and Building Official Jim Brown were present. FY 2010 GENERAL FUND BUDGET OVERVIEW Mr. Knight distributed copies of the FY 2010 General Fund Budget presentation concerning the departments of Community Development, Human Resources, Finance, and IT. Mr. Knight reiterated that personnel costs account for 70% of the budget and health insurance premiums have risen 9.4% over that of the current year; additionally, the cost of insurance rose 15% between 2007 and 2010, even though the number of full time employees decreased by 17% during the same time period. Mr. Knight reviewed the projected merit increase and amount of Village pension contribution for both GE and FPE employees and Police and Fire employees. Mr. Knight reported that an unofficial market wage adjustment survey using responses from 29 Palm Beach County municipalities found an average 0.63% cost-of-living adjustment or market wage increase, and an average of 1.4% in immediately neighboring cities. COMMUNITY DEVELOPMENT Mr. Knight detailed current year third quarter expenses. Mr. Knight reviewed personnel changes, and noted a savings of $64,727 due to funding only two permit and licensing tech positions, as the vacant position would not be filled at this time. Mr. Knight stated Community Development Department revenues are derived from community planning, building, business taxes, and code enforcement, with combined revenues proposed at $763,049 for FY 2010. Mr. Knight advised this is down $207,000 from the current year, due to the economic downturn. The Community Planning division consists of the Community Development Director and the Village Planner. Mr. Knight reported the Community Planning budget is up 3% or $6,177. Mr. Knight noted a significant cost reduction in the Building budget, primarily in personnel, due to the unfunded permit and licensing tech position. Mr. Knight reported the Building budget is down 17% or $94,162. Discussion ensued on the reduction in utility costs. Mr. Knight advised that the utilities line item was audited in all budgets, in order to assign the fee to the appropriate department. Minutes of Village Council Budget Workshop Session held August 26, 2009 Page 2 of 3 COMMUNITY DEVELOPMENT continued • Mr. Knight reviewed the cost allocation worksheet for the Building Department, and noted direct costs and indirect costs total $771,646.74, which is offset by $388,250 in departmental revenue. Discussion ensued concerning the amount of personnel versus the drop in revenue. Mr. Knight reported there are two full-time inspectors, one part-time electrical inspector, one full-time and one part-time code compliance officer, and one building official. Mr. Knight noted one of the full-time inspectors has been cross-trained in code enforcement in order to cover both inspections and code enforcement on weekends. Mr. Knight advised that one permit and licensing tech is assigned to both permitting and business tax receipts, and one tech is assigned to building permits. Mr. Knight reported the Code Enforcement budget is down 10% or $13,486. Mr. Knight stated there is a vacant part-time code compliance officer position, which is budgeted at entry level. The combined Community Development Department budget is down 11 % or $101,471. HUMAN RESOURCES Mr. Knight detailed current year third quarter expenses. Mr. Knight noted one personnel change reclassifying the H.R. Specialist position from pay grade 27 to 22, resulting in savings of $6,086. Mr. Knight reported the budget is up 12% or $24,493, primarily due to insurance costs. FINANCE Mr. Knight detailed current year third quarter expenses. Mr. Knight reported personnel changes including reclassifying the Assistant Director of Finance to Finance Manager, and a 5% adjustment in the Finance Director's salary to bring it more in line with that of surrounding communities. Mr. Knight advised the Finance budget is up 7% or $36,438, primarily due to COLA and merit pay. Discussion took place regarding health insurance costs, including continuing costs associated with the Southeast Risk Management Association (SERMA). GENERAL SERVICES -VILLAGE HALL Mr. Knight noted that the General Services budget for Village Hall is down 2% or $2,533. A question was raised regarding postage. Mr. Knight advised this includes postage for the Newsletter. DEBT AND OTHER Mr. Knight reported an increase in property/general liability insurance, due to a SERMA payment of $106,082. Mr. Knight noted a substantial reduction in debt service as four out of five debt service instruments have been paid off. Mr. Knight reviewed Council Contingency and Village Manager Contingency funds. Because the General Employees Pension Plan is funded at only 58%, Mr. Knight recommended making a $640,000 payment to the plan. Mr. Knight discussed efforts to eliminate the lump sum pension benefit through collective bargaining. • Discussion ensued on the time needed to bring the General Employees Pension Plan funding to a higher level Mr. Knight advised that elimination of the lump sum benefit provision would increase funding by six to seven percent. Additionally, Mr. Knight noted that many long-tenured employees have already retired. Mr. Knight reported that the Debt and Other budget is down 1 % or $15, 870. Minutes of Village Council Budget Workshop Session held August 26, 2009 Page 3 of 3 INFORMATION TECHNOLOGY Mr. Knight detailed current year third quarter expenses. Mr. Knight reported no personnel changes, and noted that IT staff is responsible for maintaining all the data and telephone infrastructure in Village facilities as well as computer equipment in the patrol vehicles. Mr. Knight advised that IT is migrating to a new telephone system, which will provide substantial savings. Mr. Knight reported that the Information Technology budget is up 3% or $9,256, including capital of $5,800 for email server software. Brief discussion ensued on training. Director Michael Applegate advised that a large amount of IT training is available online at no charge. Mr. Knight related that travel for training purposes has been limited to only that needed for continuing education credit to maintain certifications. DISCUSSION ITEMS Mr. Knight advised that the radiator unit in the Public Safety emergency generator is failing and must be replaced in FY 2011, at an estimated cost of $25,000. Mr. Knight reviewed General Fund budget changes and noted that all budget changes would be tracked and included in the final budget document. Mr. Knight asked Council to consider paying offthe remaining loan, at a cost of $2.2 million. Mr. Knight reminded Council that each one-tenth of a mil is equal to $158,958 and the rolled back rate is 7.4114 mils. Discussion took place concerning sanitation expenses, next year's projected capital costs, and paying for services through user fees versus property taxes. NEXT BUDGET WORKSHOP DATE Mr. Knight announced the next Budget Workshop on 9/2/09 to summarize the budget and discuss the proposed millage rate. ADJOURNMENT With no further business to come before the Council, the meeting adjourned at 8:20 p.m. Melissa Teal, CMC, Village Clerk •