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05182015 BUDGET WORK SESSION138 MINUTES CITY OF DUNN DUNN, NORTH CAROLINA The City Council of the City of Dunn held a Special Call Meeting/Budget Work Session on Monday, May 18, 2015, at 8:30 a.m. in the Dunn Municipal Building. Present was Mayor Oscar N. Harris, Council Members Buddy Maness, Carnell Robinson, Frank McLean, Billy Tart, and Billy Barfield. Also present was City Manager Ronnie Autry, Assistant City Manager Steven Neuschafer, Chief Building Inspector Steven King, Planning Director Samantha Wullenwaber, Finance Director Drew Holland, Interim Recreation Director Brian McNeill, Police Captain Robert Jenkins, Police Captain Johnny Royal, Public Works Director Billy Addison, Public Utilities Director Dean Gaster, Human Resources Director Anne Thompson, Librarian Mike Williams, City Attorney P. Tilghman Pope, City Clerk Debra West and Daily Record Reporter Keilah Goff. Absent: Mayor Pro Tem Chuck Turnage INVOCATION Mayor Harris opened the meeting at 8:30 am and gave the invocation. Afterwards the Pledge of Allegiance was repeated. AGENDA ADJUSTMENT AND APPROVAL Motion by Council Member Billy Tart and seconded by Council Member McLean to adopt the May 18, 2015 meeting agenda with changes, if any, as listed below. Items Added to the Agenda: • none Agenda Items Removed: • none Motion unanimously approved. ITEMS FOR DISCUSSIONAND/OR DECISION Fiscal Year 14-15 Budget Update Finance Director Holland provided the following status report for the current budget year (FY 2014-15): • General Fund Balance estimated surplus ending June 30, 2015 - $73,139 FY 2015-2016 Budget Ad Valorem taxes are projected at $3,538,000 (increase based on construction of Rooms To Go). Discussion was held about the $600,000 tax credits which have not been factored into the budget. Should those credits not be reinstated by the State of North Carolina, the City will have to fund this debt beginning in FY 16-17. Mayor Harris explained that Representative David Lewis is continuing to work on behalf of the City of Dunn to obtain funding toward the Harnett Training School Campus project for which the tax credits were intended. Manager Autry summarized the highlights of the proposed budget Revenues: General Fund • Ad Valorem Taxes: Figures are based on an approximate tax base of $715,341,846 keeping the existing tax rate of $0.50. per $100 valuation at a 98.94% collection rate. Tax base includes 40% completion of the Rooms To Go project. • State Revenues: The majority of the state revenues have been projected to remain the same as previous years' or with a slight increase based on the current year's collection estimate. We continue to monitor the state's progress on all revenues and their impact on the City. • Solid Waste Fees: There is no increase in monthly garbage or recycling collection fees. The monthly fee will remain at $13.95 and $3.05 respectively. • Fund Balance: Powell Bill Fund balance was used to cover projected capital costs of the signals and gates at the Pearsall Street railroad crossing. Expenditures: General Fund • General Fund operations are comparable to the FY 14-15 budget. • Employee benefits include a 2% 401 (k) contribution, longevity and a state -mandated retirement of 6.67% (decreased from 7.07% for FY 2014-15). Police officers receive a 5% 401 (k) contribution and state -mandated retirement of 7.15% (decreased from 7.41% for FY 2014-15). Health insurance cost increased by 4%. • One (1) new position has been proposed in the General Fund. A Fire Inspector position is proposed in the inspections department. This position has been proposed as a half year position to begin in January 2016; however, Manager Autry stated that a letter has been received from Dunn Emergency Services advising the City that they would be eliminating this position in October of 139 2015 but they will work with the City until this position is filled by the City. The inspections department may be restructured mid -year after evaluation. All debt service requirements have been appropriated in this budget to meet our debt obligations. Police tasers and in -car dash cameras have been budgeted however the City will wait to see if grant funding will be available for these items before the City purchases them. The Police Department currently has body cameras for each officer and they have been updated by means of funding from the ABC Board. Capital items have been addressed and a list of items proposed for funding is as follows: Planning Department - Large format multi -functional plotter (1/2 from Wtr/Swr Fund) $ 7,500 Police Vehicles (5 @ $29,000) $145,000 (combined USDA Grant & Loan) Aminal Shelter Quarantine $ 40,000 Public Works — Zero Turn Mower $ 7,500 Cemetery - Zero Tum Mower $ 7,500 Cemetery Pick Up Truck $ 25,000 Airlock for Library entrance $ 18,000 Manager Autry explained that there is a state regulation for the Animal Shelter Quarantine which will separate potentially diseased animals from other ones. Discussion was held that Harnett County does not currently contract animal control service for the City of Dunn as they provide to other municipalities in Hamett County. Discussion was held if it would be feasible to look at the possibility of having the County provide this service to Dunn for a fee as they provide to other towns. It was discussed if the level of service the County provides for this service would equate to the current service given by the City to its' residents. Discussion was held if the City could contract with local veterinarians for quarantine service instead of expending the money to build this facility. Discussion was held that the City contracted with a landscape contractor to cut right of ways and areas around city buildings and city parking lots to see if there is an overall improvement to the appearance of the City. This will allow the cemetery crew to concentrate only on the maintenance of the cemeteries. Nathan Harris Athletic Complex at Tyler Park Phase II debt service of $88,690 has been factored into the budget. When offset by the pledges received for this project, the debt is reduced to approximately $85,000. Discussion was held that monies have been allocated to improve the street signs through -out the City. Manager Autry stated that he is waiting for the completion of the "Welcome to Dunn" signs with the All - America City emblem and "Gateway to Campbell University" language. Discussion was held about the need for pick ups and dump trucks in the Public Works Department and a pick up for the Recreation Director. Discussion was held that the City will be accepting applications to replace two (2) police officers that recently resigned to work in the private sector. Manager Autry stated that with the consolidation of the communications department with the County, the City retained one individual which the Chief stated he needed. He added that the Mayor has questioned if this position could be used in conjunction with helping in the Manager's office. This issue will be discussed with the Police Chief to evaluate this position along with another position in the Police administration office. It was discussed that a police lieutenant position and a support services coordinator which transferred from the communications department currently have combined salaries and benefits of $112,700 that could be placed in a contingency fund and used to reallocate in the Police Department after consultation with the Chief. Mayor Harris stated that these two positions could be eliminated and used for the reorganization process. Council Member Maness stated that he would like to hear the recommendation of Chief Pope and how elimination of these positions may or may not impact his operation. Mayor Harris stated that Manager Autry will meet with Chief Pope to develop what is best for the department. Discussion was held that NCDOT will be landscaping the round -a -bout in the summer of 2015 and the City will be installing an irrigation system in-house. Break: 10:00 —10:15 am Manager Autry recommended that a storm water fee be implemented due to increasing monies being used to correct storm water issues. Replacement of older piping can be costly. The storm water study has been completed and once the informational booklets are received from Davis -Martin -Powell, they will be distributed to the Council. Many municipalities already charge a storm water fee to their residents. A proposed fee of $1.50 to each household would generate annual revenues of approximately $60,000- $70,000 and would allow the City to fund storm water projects. Consensus of the Council was to implement a storm water fee of $1.50 per household in the proposed fee schedule. Discussion was held that if a fee is implemented, it should be allocated in a restricted fund within the budget. Assistant Manager Neuschafer provided updates for downtown revitalization. The City is currently working with DOT for sidewalk replacement on E. Cumberland Street from Clinton Avenue to Magnolia Avenue. Monies would come from the fund balance to complete the sidewalk replacement along Magnolia Avenue from Cumberland Street to Edgerton Street. Discussion was held that the bricks will need to be realigned downtown, trees trimmed and grass removed from the sidewalks. A budget amendment in the 140 amount of $350,000 from the Powell Bill Fund and/or General Fund balance will be forthcoming to the Council to complete the downtown revitalization project including Magnolia Avenue. Assistant Manager Neuschafer provided an update of renovations for City Hall. He is awaiting bids from the contractors for improvements to include a new front door system, raise the front patio, work on the handicap ramp at the front entrance, bathroom upgrades in the front lobby, improve the drive thru window in the finance office, and install energy efficient lighting through -out City Hall. They need to move forward to complete the renovations to City Hall so the loan can be closed for the Harnett Training School Project. Revenues: Water & Sewer Fund • Water & Sewer Rates: A 5% increase is proposed for the inside city limit water rate from $3.89 per 1,000 gallons to $4.08 per 1,000 gallons and outside city limit water rate from $7.78 per 1,000 gallons to $8.16 per 1,000 gallons. The minimum water rate of $12.75 for the first 2,000 gallons will not change. A 10% increase is proposed for the inside city limit sewer consumption rate from $3.63 per 1,000 gallons to $3.99 per 1,000 gallons and outside city limit sewer consumption rate from $7.26 per 1,000 gallons to $7.99 per 1.,000 gallons. The sewer base rate will not change. • Fund Balance: Fund Balance was not required to balance the budget. Sampson County is currently using their well system and they have advised that they will not be using bulk water which will result in a $250,000 loss in revenues; however, they are aware that should they need water in an emergency situation, then they will be charged at a higher rate. It was discussed that $100,0004200,000 should be annually appropriated for unexpected water & sewer line replacements due to the aging system through -out the City. Expenditures: Water & Sewer Fund • Water & Sewer Fund operations are comparable to the FY 14-15 budget. • Employee benefits include a 2% 401 (k) contribution, longevity and a state -mandated retirement of 6.67% (decreased from 7.07% for FY 2014-15). Health insurance cost increased by 4%. • No new positions have been proposed in the Water & Sewer Fund. • All debt service requirements have been appropriated in this budget to meet our debt obligations. • Capital items have been addressed and a list of items proposed for funding is as follows: Hand-held meter readers (2 @ $1,325) $ 2,650 Spartan 758 Trailer Jet $ 17,000 3' Trash Pump $ 3,000 Tracer HL 5000 Leak Detector $ 5,000 VM -810 Locator System $ 3,500 Mini Air Hammer $ 3,500 Lift Station — SCADA Upgrade $ 6,500 Eastside LS—Self Cleaning Wear Plates & Impellors S 5,000 Large format multi -functional plotter (1/2 from General Fund) $ 7,500 Water Plant Pick Up Truck $ 20,000 Water Plant— 4 mgd finish water pump $ 30,000 Sewer Plant — Storage cubicle $ 1,500 Sewer Plant — 8" Super T circulation pump $ 11,500 Sewer Plant — 4" Grit pump $ 7,500 Sewer Plant — SCADA software upgrade $ 7,500 Proposed Fee Schedule for FY 15-16 The proposed fee schedule was presented to the Council. Storm Water fee of $1.50 per household will be added to the schedule based upon Council deliberation. Manager Autry pointed out that Cemetery lot fees are proposed to increase. Privilege License fees have been eliminated based on the legislature; this resulted in the loss of $65,000 in revenue. A business registration fee is now being considered by the legislature. Dunn Area History Museum (Community Service Contribution) Mayor Harris explained that a letter has been received from Mr. Robert Carr, President and Mr. Mark Johnson, vice president of the Dunn Area History Museum, officially requesting a donation of $7,500.00 from the City of Dunn to financially assist the association in acquiring a 501 (c) (3) classification to continue their work in creating a history museum. Additionally, they are seeking a long-term monetary commitment from the City of Dunn to help establish a permanent location for the museum. These funds would be used solely for the maintenance and upkeep of the museum facility, insurance, building rent, utilities, signs, security, ADA compliance, display equipment, showcases and maintenance. 141 Manager Autry stated that community contributions have not been allocated in the proposed budget. Council Member Robinson stated that he doesn't see how the City can commit long term funding above the initial $7500.00 for this organization to incorporate. Council consensus to appropriate up to $7500.00 in the FY 15-16 Budget for the Dunn Area History Museum to acquire a 501 (c) (3) classification and take into consideration their request for a long-term monetary commitmentat the appropriate time. Manager Autry was directed to take this appropriation from the contingency fund. Council Member Barfield stated that Harnett County is also considering a donation to this organization. Special Olympics Council Member Barfield stated that Harnett County will be contributing to this organization and he would like for the City of Dunn, to once again, invest in this cause. Council Member Robinson concurred that he would also like the City to make another contribution to Special Olympics. Mayor Harris stated that this is an investment back into our community. Resurfacing Mayor Harris reminded the Council that there will not be any funds appropriated for resurfacing in the proposed budget. Cemetery Renovation and Maintenance Guidelines Mayor Harris stated that this document will be proposed again on the June 9, 2015 agenda. Council Member Maness pointed out that many of the guidelines in this document had associated costs and will require further discussion by the Council. Manager Autry recommended that the Council conduct a short work session to discuss these guidelines. Special Call Meeting Date Set Mayor Harris recommended that the Council meet one on one with the City Manager to address their issues of concern with the Cemetery Renovation and Maintenance Guidelines prior to a Special Call Meeting which Mayor Harris called for Tuesday, June 2, 2015 at 8:30 am to discuss it further and prepare to make a decision about the document at the June 9"' Council meeting. If necessary, Mayor Harris stated that the Council may discuss additional budget issues at the Special Call Meeting on June 2na With no further business to discuss, a motion was made by Council Member Barfield and seconded by Council Member McLean to adjourn the meeting at 11:35 am. Motion unanimously approved. Attest: Debra G. West C City Clerk G\TY OFA'., r'GpRPO=q��•.� .LOR SEAL Oscar N. Harris Mayor