Memorandum

City of Lawrence

City Manager’s Office

TO:	Dave Corliss, City Manager
FROM:	Cynthia Wagner, Assistant City Manager
CC:	Casey Toomay, Budget Manager
DATE:	March 11, 2010
RE:	2009 Year-End Information and Initial 2011 Budget Development Information

2009 Fourth Quarter Report and Expenditure Summary

As was presented in the City Manager’s Report on March 9, 2010, for the third consecutive year, the city was able to manage expenditures to revenues in 2009.  The General Fund ended 2009 with expenditures lower than revenues by $340,581.  Attached are the 2009 fourth quarter report, fund summaries, and 2009 vendor payment list which were included in the City Manager’s Report.

Development of 2011 Budget

At this time, preparations for development of the 2011 budget have begun.  On March 12, a budget kick-off memo outlining parameters for 2011 budget development was provided to department directors and staff members responsible for departmental budget development. 

General direction is to provide two scenarios:  one holding 2011 expenditures (excluding personnel) to 2010 budget levels, the other to reduce 2010 budget (excluding personnel) by 2.5%.  Department have also been asked to provide the impact to service levels of a 2.5% reduction.

In late April, staff will present first quarter 2010 information, which will provide additional information in how to proceed with development of the 2011 budget.

In the first quarter, staff has been reviewing a number of issues that will have an impact on development of the 2011 budget, including what impact state funding cuts may have on various city functions (especially any changes to the alcohol tax); a review of our recent interest rates in comparison to other cities and our budgeted levels; continual monitoring of sales tax revenues in comparison to budgeted levels; and reviewing expenditures to determine where we may be able to achieve economies of scale in purchasing or revising our purchasing practices, particularly in the areas of contractual mowing, cleaning and car washes of city vehicles. 

In addition to review of revenues and expenditures in the general fund, staff is closely monitoring all financial aspects of other funds, most notably the gas tax, solid waste, water and wastewater and public parking funds.

Staff has developed a recommendation regarding review of funding requests by social service agencies and has drafted a letter to be sent to the agencies outlining the budget request process for 2011.  Staff would like to review this information with the City Commission at the March 23 study session in order to obtain direction on how to proceed on this issue.

Library Proposal

The Library Board has sent a letter, requesting a public referendum on library facility expansion and renovation, and associated operational funding be placed on the November ballot.