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Minutes 06-11-12 MINUTES OF THE FINANCIAL ADVISORY COMMITTEE MEETING HELD ON MONDAY, JUNE 11, 2012, @ 6:00 P.M., IN THE BOYNTON BEACH CITY LIBRARY, ROOM "A ", 208 S. SEACREST BLVD., BOYNTON BEACH, FLORIDA PRESENT: Don Scantlan, Chair Barry Atwood, Finance Director Dennis Dougherty Tim Howard, Deputy Finance Director David Katz Terry Lonergan 1. Call to Order Chair Scantlan called the meeting to order at 6:00 p.m. Roll call was taken. A quorum was present. It was noted Steve Grant, a potential Committee member was present. Chair Scantlan advised he wanted to add an item at the end of the agenda to address a letter received from a citizen. Motion Ms. Lonergan moved to approve the agenda as amended. Mr. Katz seconded the motion that unanimously passed. 2. Approval of May 21, 2012, Minutes Motion Ms. Lonergan moved to approve the minutes. Mr. Dougherty seconded the motion that unanimously passed. Mr. Katz left the room at 6:02 to make copies, which left no quorum. Mr. Katz returned at 6:07 and the meeting continued. 3. Distribution and presentation by each Committee member of individual recommendations. Employee Leave Benefit Analysis - Lonergan Ms. Lonergan advised she reviewed the contracts for everyone and also compared them to Delray Beach. She advised the contracts appeared to be very generous as far as vacation and sick time was involved. In addition to sick and vacation time, Police and Meeting Minutes Financial Advisory Committee Boynton Beach, FL June 11, 2012 Firefighter also received personal time. She reviewed the amounts of time received for each level of personnel. There was lengthy discussion on the excessive amount of time off an employee was afforded and that the personal time should be taken away. There was also discussion on the accumulation of sick hours up to 1040 hours. After that limit was reached, an employee could transfer hours to vacation hours. Chair Scantlan advised last year there was a discussion for a use it or lose it policy. Vote the vote was 4 for, 0 against. Compensation Package Analysis - Lonergan Ms. Lonergan began by stating it was very difficult to find ways to reduce these items to pull the budget together. Her recommendation would be to discontinue paying for city - owned cell phones, with the exception of department heads. She would also recommend discontinuing car allowances for all except the emergency department heads. She opined that those that have City paid cell phones and car allowances made sufficient salaries to cover the cost out of their own pocket. City Commissioners have a generous expense account and the City still pays their cell phone bill. The problem was some of the cell phones and cars were contractual. Two of the take home vehicles are not contractual. With a preliminary estimate, it appeared to be a savings to the City of $66,000 per year for take home vehicle and car allowances; $47,316 per year for City owned cell phones; and $54,000 per year for cell phone allowances. Mr. Katz opined the reduction and /or elimination should be City -wide and not exclude department heads. There was discussion on taking away the vehicle allowance. Chair Scantlan indicated when you have a vehicle allowance; the administrative portion of tracking mileage would be deleted. If the vehicles are taken away, when originally it was part of the position, the employee must keep logs every day, turning in the mileage to get reimbursed. In addition, the effect of not having a City vehicle could possibly make the City Tess efficient. Services may not get completed if an employee knows their own car would be used, but with a company vehicle, there would be no choice. Mr. Katz commented that anyone who has a job and had to go to a site and took his own vehicle, they should keep a log. He could get his reimbursement at the end of the year by deducting it off taxes, rather than have the City provide reimbursement. There was lengthy discussion on the pros and cons of eliminating vehicle allowances and cell phone allowances. Chair Scantlan reminded the members that an exempt employee did not look at a cell phone as a perk, whereas a non - exempt employee would be eligible for overtime should the phone ring after regular working hours. 2 Meeting Minutes Financial Advisory Committee Boynton Beach, FL June 11, 2012 After further discussion, there was clarification in the recommendation to state eliminating cell phones and vehicle allowances for everyone. Ms. Lonergan reminded everyone that this involved a very small dollar amount in closing the budget shortfall. Vote Tthe vote was 3 for, 1 against. Employee Pension Contribution — Katz Mr. Katz advised that if all employees contributed an additional 2% per year to the pensions, it would be an additional $1263 million savings as an expenditure out of the General Fund. Mr. Katz was proposing each employee City -wide contribute an additional 6% which would bring the savings up to $3.790 million. He felt that although employees would be saving for retirement, some would view it as a pay cut. Chair Scantlan maintained that it had been more than three years since employees received a pay raise and would view taking an additional 6% out of their pay for a future benefit as a definite pay cut. Mr. Katz maintained there would be no pay raises, but the increase would prevent lay offs. There was discussion about ways to reduce benefits to help with the deficit. The recommendation to be voted on was that one of the strategies the Commission could use to increase revenue would be to increase employee pension contributions. Vote The vote was 3 for, 1 against. Car Allowances — Katz Mr. Katz advised this topic was the same that Ms. Lonergan presented. Cell Phone Allowances — Katz Mr. Katz advised this topic was the same that Ms. Lonergan presented. Additional Revenue Sources — Katz Mr. Katz suggested the refuse pickup be raised $1.00 a month. It would raise the revenue by $450,000. This revenue could be transferred to the General Fund. Vote The vote was 4 for, 0 against. 3 Meeting Minutes Financial Advisory Committee Boynton Beach, FL June 11, 2012 Additional Revenue Sources — Katz Mr. Katz recommended raising the millage rate enough to raise an additional $500,000 in property taxes. Mr. Atwood advised it would be a 2.2% increase in the rate. There was discussion on the difference between this and the rollback rate. If the property values did not rise, it would equal an approximate $20.00 per year increase. Chair Scantlan felt the City would need to have its tax rate set at the rollback rate and making it a set amount. Next year, if property values were to increase, he would still be in favor of the rollback rate rather than an increased tax rate because tax rates would begin to go down with a rollback. Chair Scantlan gave a detailed explanation of the differences and there was a lengthy discussion and opinions before the vote. Vote The vote was 3 for, 1 against. Employee Contribution to Medical Insurance — Katz Mr. Katz requested clarification on what employees paid for dependent insurance and for themselves. He advised it cost the City $8259 per employee for insurance coverage per year. He was suggesting that employees pay 50% or 75% of their insurance coverage depending on their salary, as well as remain at 100% payment for dependent. There was discussion and a decision that the recommendation be that all employees pay 50 %, regardless of salary. Vote The vote was 4 for, 0 against. Additional Revenue Sources /Reduction to TIF to CRA — Katz Mr. Katz proposed reducing the TIF dollars that would be given to the CRA. It would create an increase of $400,000 in revenue coming back to the General Fund. There would be a process involved in completing this should it be approved by the Commission. Chair Scantlan wanted clarification from Mr. Atwood as he was under the assumption that TIF was part of the statute as far as the increase and what was allowed to go into the CRA. Mr. Atwood advised there was a base year set on the taxable value. Next year, due to redevelopment or added value, the tax would go up. The difference of what goes up was what would go to the CRA. Mr. Howard clarified that what Mr. Katz was proposing was changing the boundaries of the CRA, but not the values, thereby making the CRA area smaller. 4 Meeting Minutes Financial Advisory Committee Boynton Beach, FL June 11, 2012 Vote The vote was 3 for, 1 against. Going off the agenda and assigned areas of recommendation, Mr. Katz added that he had an additional recommendation and requested consensus from the Board to discuss it at this meeting. He advised the topic was "staff reduction of non - essential staff', which included two named positions. It was not a scheduled researched topic or a topic on the initial list. The members indicated they would prefer Mr. Katz bring it up at the next budget meeting and he indicated he would bring it up to the Commission. Public Safety Communications Hub — Dougherty Mr. Dougherty made the recommendation that the Communications Hub proposal be kept as he felt it was a good idea. However, nothing had happened yet. He was made aware that a report was done but had not seen it. He recommended rolling this topic over to next year. Vote The vote was 4 for, 0 against. Capital Improvement Fund — Dougherty Mr. Dougherty advised he spent a lot of time trying to understand the plan and met with key people involved. Projects had been pushed down the road. There were funds allocated for certain projects that were not happening, so it appeared monies were simply being moved around. Mr. Atwood explained the financial area of the Capital Improvement Plan. There was lengthy discussion and Mr. Dougherty recommended that the plan be more realistic instead of moving figures around all the time, which delayed the projects Vote The vote was 4 for, 0 against. Street Lighting on County /State Roads — Scantlan Chair Scantlan advised this came out of discussion of redundant City and County services. Mr. Atwood had pulled the resolutions dating back to 1928 where agreements for different street lighting existed. Over the years there had been a multitude of different street lighting. The County and State roads should be similar to 1 -95. The City of Boynton Beach was not billed for streetlights on 1 -95 that are within the City limits. On State and County roads, the City was billed, even though the lights were not on a 5 Meeting Minutes Financial Advisory Committee Boynton Beach, FL June 11, 2012 City road in Boynton Beach. Monies come out of the County ad valorem revenue that was shared. Chair Scantlan recommends that the Commission work with the League of Cities to create a State /County -wide policy where the State /County pays the FPL bill for all street lighting along State /County roads regardless of whether they are inside municipal boundaries or not. Vote The vote was 4 for, 0 against. County /City Services Redundancies — Scantlan Chair Scantlan advised he reviewed the organization charts for the City and the County. For every City department, there was a County department. In other words, one could say the City was 100% redundant with the County. The question would be what departments should be kept to consider it a City. This was being brought up due to the possibility of the Police Department being turned over to the Sheriffs Department. Chair Scantlan advised he had two recommendations. First, establish a prioritized list of which departments should be turned over to the County. The second suggestion would be to establish the means in which data would be collected and analyzed. There was lengthy discussion on the pros and cons of the issue. Vote The vote was 3 for, 1 against. Make /Buy Other City Services — Scantlan Chair Scantlan recommended status quo. He did not complete the study this year but would next year. The study was to investigate if any City services could be outsources to save money and /or increase revenue. Mr. Katz requested it be on record that he would in no way be in favor of turning over the Sanitation Department to a private contractor. Vote The vote was 4 for, 0 against. 4. Letter Received from Citizen Chair Scantlan advised the members that there was a letter received from a citizen and would be answered by recommending the citizen attend the City Commission and Budget Workshop meetings to bring up issues and to also participate in the survey next year. 6 Meeting Minutes Financial Advisory Committee Boynton Beach, FL June 11, 2012 The Financial Advisory Committee would present the recommendations to the City Commission on Tuesday, July 3, 2012, providing Chair Scantlan completes the summary of the suggested topics. The City Commission budget workshop dates are Monday - Wednesday, July 16 -18 in the Library Program Room. 4. Adjournment Motion Mr. Katz moved to adjourn. Ms. Lonergan seconded the motion that unanimously passed. The meeting was adjourned at 7:50 p.m. .-) ( L- -k- _ /tt.(,Q--c°_ Ellie Caruso Recording Secretary 7