Memorandum

City of Lawrence

City Manager’s Office

 

TO:

Dave Corliss, City Manager

 

FROM:

Cynthia Boecker, Assistant City Manager

Casey Toomay, Budget Manager

 

CC:

Diane Stoddard, Assistant City Manager

Ed Mullins, Finance Director

DATE:

July 17, 2008

 

RE:

2009 Budget

 

 

Mill Levy Scenarios

At the July 14, 2008 study session, Commissioner Highberger requested that at the time of setting the maximum mill levy as part of setting the budget public hearing date, two (2) scenarios regarding the mill levy be provided.  Notification of public hearing under each scenario is outlined below and actual notification documents are attached. 

 

Scenario 1:     Reflects the City Manager’s recommended budget, which re-allocates the existing transportation mill levy to the general fund, bond and interest fund, and provide for a slight reduction in the total mill levy.  The total mill levy in this scenario is 26.688.

 

Scenario 2:     Includes the City Manager’s recommended budget as well as full property tax support for the transit program, resulting in an increase to the mill levy of 2.52 mills.  In 2009, $2,452,484 is needed to fully fund transit.  Expenditures also increase in order to meet state law fund balance requirements of five percent (5%).  The total mill levy in this scenario is 29.208.  Tax bills for 2009 would include the increased levy.

 

The table below compares the two scenarios.

 

Highlights of the City Manager’s Recommended Budget

The 2009 recommended budget totals $146,339,949 of expenditures in all funds.  This is supported by $152,571,143 of resources.   The recommended budget maintains appropriate fund balances pursuant to City policy goals.  The recommended budget maintains existing city services and provides funding to respond to estimated fuel and energy cost increases.  The recommended budget does not include funding for any new positions in 2009, unless the City Commission proceeds with expansion of the residential rental program.

 

The General Fund expenditure budget totals $66,551,615.  As previously discussed, in order to balance projected 2009 expenditures with anticipated 2009 revenues, cuts totaling $3.9 million were made to the General Fund operating budget requests by departments:

 

·         Administrative Support III (Administrative Services Department)

·         Planner II (Planning and Development Services Department)

·         Two Zoning Enforcement Officers (Planning and Development Services Department)

·         Management position in Development Services

·         Management Analyst (Finance Department)

·         Information Systems Technician (Information Systems Department)

·         Human Relations Staff Attorney (Legal Department)

·         Municipal Court Clerk (Legal Department)

·         GIS Analyst (Public Works Department)

·         Parks and Recreation eliminated five (5) vacant positions with its budget submittals.

 

Vacancies in the Police and Fire/Medical Departments have been left funded. 

 

·         Requests of $2.3 million for the purchase of a ladder truck and a quint in the fire department 2009 budget have been eliminated.  

·         the KPERS retirement amount has been reduced based on revised calculations from the State;

·         printing, contractual services, training and travel, advertising, and supplies line items in various departments has been reduced;

·         replacement of four (4) vehicles has been deferred per recommendations of the fleet manager (this includes two (2) sedans in the fire department, one (1) police vehicle and one (1) public works inspection vehicle);

·         contingencies for weather related events in the public works budget have been eliminated;

·         transfers from the general fund to the worker’s compensation, equipment capital and liability reserve funds have been reduced.

 

The recommended budget includes revenues of $3,759,875 from two (2) proposed sales tax referenda.  Resolutions considering placing these two (2) questions on the November ballot will be considered by the Commission at the August 5 City Commission meeting.

 

The recommended budget also includes $880,000 for all compensation adjustments in the General Fund.  As previously discussed, since compensation is an on-going expense, funding through on-going revenues, like the mill levy, is preferable to one-time funding (e.g. transfers from reserve funds to purchase equipment or provide maintenance).  This compensation recommendation requires revenues equivalent to approximately 1 mill. 

 

Charges for service are recommended to increase as follows:

Solid Waste – four percent (4%) increase in rates.

Water and Wastewater – An overall increase of five percent (5%) is recommended (twelve percent (12%) increase for water and no increase for wastewater.)        

 

Budget Calendar

Outlined below is the remaining process for adoption of the 2009 Budget.

                   City Commission Direct Publication of Notification                        July 22

                   Notification Documents to Lawrence Journal World                     July 23

                   Publish Notification                                                              August 1

                   Public Hearing                                                                    August 12

                   First Reading of Budget-Related Ordinances                              August 12

                   Second Reading/Adoption Budget-Related of Ordinances              August 19

 

Action Item

Both attached summaries set August 12 as the public hearing date.  The required budget summary/notice of public hearing document will set the upper limits of the 2009 budget and the mill levy.  Once the summary is published, the budget cannot be increase, nor can the mill levy.  Staff seeks direction from the City Commission regarding which scenario of publication of the 2009 Budget summary and notice of public hearing should be used.