Memorandum

City of Lawrence   

TO:	Craig Weinaug, Douglas County Administrator Randy Weseman, Lawrence Public Schools Superintendent
FROM:	David L. Corliss,  Interim City Manager
CC:	Mayor Mike Amyx City Commissioners Debbie Van Saun, Assistant City Manager
Date:	January 18, 2007
RE:	Summary of Discussion on Future Fiscal Impact Issues Facing County, School District and City – 2007 Update

On May 31, 2006 the following officials met:

· Sue Morgan, Vice-President, Lawrence Public Schools;

· Bob Johnson, Chair, Douglas County Commission;

· Mayor Mike Amyx;

· Randy Weseman, Lawrence Public Schools Superintendent;

· Craig Weinaug, Douglas County Administrator; and

· David Corliss, Interim (at the time) City Manager. 

The purpose of the meeting was to follow-up earlier discussions concerning known fiscal/spending demands, particularly focusing on possible mill levy demands as the jurisdictions prepare either their 2006 – 2007 budget (School) or their 2007 calendar year budgets (County and City).  The group discussed the impact of the recently enacted State legislation to remove future acquisition of machinery and equipment, telecommunications, and railroad property from property tax roles will likely have a significant impact on future assessed valuation growth – impact the school district, county and the city – and the legislative program to provide funding to cities and counties in future years will unlikely fund the gap. 

The following issues are neither prioritized nor categorized based on importance or impact and have been updated as to status changes made since that May 31^st meeting.  Additional information regarding the City’s short term major capital projects is provided in a January 12, 2007 memo presented at a January 17, 2007 City Commission study session.  

Industrial Sites and Open Space:   This issue has been discussed by County and the City officials in recent years, including the ECO2 proposals.  There has been discussion among County and City leadership focused on the County taking the leadership role in the acquisition of industrial space and the acquisition and management of open space.   The current estimate for a County mill levy to fund a 20 million dollar 10 year program was 1.75 mills per year.  The City of Lawrence would have responsibility for infrastructure installation in a new industrial / business park site, with no current estimate available on City fiscal responsibilities (deferred special assessments similar to the East Hills business park being a likely model for this effort).  There was a consensus that this issue was not planned as having a 2007 mill levy impact.

County Road Issues:  County officials indicated growth related County road items were not likely to be a 2007 budget item or mill levy impact.

Partners for Lawrence Athletics and Youth (PLAY):  The Request for Proposals for the sports/athletics/recreation facility needs study has been disseminated with a due date of June 12, 2006.  Neither the City, County nor USD officials at the meeting anticipated that this item would be a 2007 budget or mill levy item, however, the issue will likely be discussed during 2007 after receipt of the feasibility study with possible budget and mill levy impact (capital and operating) if any projects are pursued. 

County Jail: County officials indicated that expansion (capital and operating budget impact) of the County jail is not planned until approximately 2010, whether such expansion will have a mill levy impact at that time is not known.  The Sheriff’s office indicates that the most likely expansion would be a single project with two phases.  The first being a halfway facility and the second including an actual expansion of beds at the facility.  Preliminary costs are estimated at around 4 million.

Youth Detention Facility:   County and School District officials will discuss possible expansion (capital and operating budget impact) of the day school at the Youth Detention Facility.  This may be shared cost between the County and School District.  Expansion in the next two to five years is anticipated, with an estimated cost of approximately $4 million.  Preliminary discussions have taken place with an architect regarding space needs and cost proposals. 

USD 497 Facility Expansion:  School officials indicated that given current growth plans they do not have plans to build an elementary school in the next five years.

Impact of 2006 Legislative Session on USD 497:  School officials indicated that if the recently enacted school finance legislation withstands Kansas Supreme Court review, the School District Board will face a 2007 mill levy increase in the range of 4 to 6.5 mills to fund anticipated budget demands.  This increase is the result of State funding allocations and increased mill levy authority under the Local Option Budget (LOB) and the capital outlay budget portions of the USD mill levy.

Lawrence Public Library:  The City conducted a study session on June 8 to discuss the public/private partnership proposals received concerning the possible expansion of the library.  There are four public/private proposals, plus an evaluation of expansion on the existing site.  The proposals range in possible costs and complexities of implementation. The consensus of the Commission has been that any expansion viewed favorably by the Commission will be placed before City voters for approval.  Voter consideration is unlikely in 2007.  This item is planned as a February agenda item for discussion by the City Commission.

City Budget and Street Maintenance Issues: City officials indicated that a major focus of the City’s 2007 budget will be seeking to provide additional resources for street maintenance.  The City’s Public Works department is requesting an additional $2.8 million (beyond current efforts) in 2007 and 2008 to respond to the City’s pavement management system findings concerning street conditions.  This will likely be a priority of funding in 2007 and place a stress on the City mill levy, in addition to existing pressures.

City Office Space/Joint Office Space:  The City and the County have discussed the possibility of sharing office space for certain functions, as the City has explored possible options to respond to existing office space needs, including the desire to house a “one stop” location for development services (planning, building inspection, coordination of infrastructure with development, etc.).  Whether an opportunity for space can be funded in the near future is not known.

City Water and Wastewater Issues:  City officials indicated that water and wastewater rates will likely increase as previously planned for 2007.

Social Services-WRAP:  The City, County and USD officials added funds for support of this program starting in January of 2007.  This program is likely to be a permanent funding commitment, since federal funding was unlikely to return in the foreseeable future. 

North Lawrence Drainage Study Initiatives:   City officials at the meeting indicated that major improvements were not likely to be funded in 2007 given the importance of street maintenance priorities.