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Minutes July 05, 1988CITY OF DENTON CITY COUNCIL MINUTES JULY 5, 1988 The Council convened into the Work Session at 5:30 p.m. in the Civil Defense Room. PRES ENT: Mayor Stephens; Mayor Pro Tem Hopkins; Council Members.Alexander, Ayer, Gorton and McAdams. ABSENT: Council Member Boyd 1. A Council - Manager discussion was held regarding major issues relative to the 1988-89 budget. Lloyd Harrell, City Manager reviewed the major budget issues for the next fiscal year which included the following: 1. General Fund Level - staff was recommending using 4270,000 of the unreserved fund balance to help balance the operating budget. 2. Revenues - The three items listed under this item were sales tax, property tax, and other revenues. Staff was predicting a 7.2% increase in collections over the current budgeted amount. Staff recommendation for the property tax was to keep the rate at the current level of 4.5928 per 4100 valuation. Other revenues included a staff recommendation to raise the cable television franchise tax to 5% effective January 1, 1989. 3. New Fire Station - Staff was recommending funding the reserve for manpower for the new station at 4120,000 for 1988-89. 4. New Positions - Staff recommended the addition of 13.25 new positions for the next budget year. 5. Salary Adjustment - Staff was recommending a 4% salary adjustment for all job families except Service/ Maintenance, Temporary/Seasonal and Executive. The Service/ Maintenance classification would receive a 5% increase and the Executive would receive a 3% increase. 6. Benefits Adjustment - Staff recommended these benefits adjustments for the next budget year - TMRS updated credit, Martin Luther King, Jr. holiday, classification system overhaul, police incentive pay (6 months) fire holiday pay restoration, fire incentive pay (6 months), and fire pension plan increase. 7. Other Agency Contributions - Staff presented recommendations from the Human Resource Committee which included the funding of four new programs, the increase of funding for some current agencies and a decrease in some funding. The alternatives in this area were to keep the level of funding at the current level which would not fund any new programs and would not take into consideration any increases in current funding, fund at the recommended level or reduce below the current funding level. 129 130 City of Denton City Council Minutes July 5, 1988 Page 2 8. Downtown Development - Staff recommended the funding of 449,587 for the City's share of the Main Street Program under the current 4.5928 tax rate. 9. Health Insurance Fund - Staff was recommending the transfer of 4170,000 to the Health Insurance Fund and 430,000 for an actuarial study. Employee contributions were also recommended for an increase. 10. Martin Luther King, Jr. Recreation Center - Staff recommended that the Center be funded as presented in the draft proposed budget in the amount of 4143,088. 11. Beautification Improvements - Staff recommended that because of the critical need for beautification improvements in the City that one additional position be funded for the Planning Department to assist the Parks Department in beautification issues. 12. Visual Arts Center - Staff's recommendation was to maintain the Visual Arts Center and provide custodial and utility support at the same level as the City does for any other City building. 13. Tax Exemptions for Persons over 65 - Staff recommended increasing the exemption by 41,000 for the 1988-89 fiscal year. 14. Economic Development - Staff recommended leaving the funding at the current level. 15. Geographic Information System - It was staff's recommendation to lease/purchase the Geographic Information System on a five year basis, and to fund the first year costs with the Utility System funds. 16. Transportation Engineering - Staff recommended funding 445,000 for new packages in this area. Major Issues - Utility Fund The proposed Utility budget for 1988-89 as submitted to the Public Utility Board indicated a total revenue for the operating budget of 481,923,000 in expenditures and 483,123,000 in revenues. Exhibit A details all of the information presented by Harrell for the Council. City of Denton City Council Minutes July 5, 1988 Page 3 2. The Council did not meet in Executive Session during the Work Session. The Council then convened into a joint Work Session with the Public Utilities Board at 6:30 p.m. in the Civil Defense Room of City Hall. COUNCIL PRESENT: Mayor Stephens; Mayor Pro Tem Hopkins; Council Members Alexander, Ayer, Gorton and McAdams. COUNCIL ABSENT: Council Member Boyd PUB PRESENT: Vice-chairman Thompson; Members Frady, Chew, and LaForte PUB ABSENT: Chairman Laney 1. A joint discussion was held regarding the Denton County Regional Water/Wastewater Study Master Plan. Council Member Ayer presented background material regarding the plan and requested approval of the study and funding. Bob Nelson, Executive Director for Utilities, presented an introduction to the study. Tom Taylor, General Manager of the Upper Trinity Municipal Water Authority, Inc., presented a slide presentation regarding the study. He stated that the goal of the study was to develop a regional strategy with alternative plans for meeting the water and wastewater needs of the area until the year 2010. The Council convened into the Regular Session at 7:00 p.m. in the Council Chambers. PRESENT: Mayor Stephens; Mayor Pro Tem Hopkins; Council Members Alexander, Ayer, Gorton and McAdams. ABSENT: Council Member Boyd 1. The Council received a presentation of the Government Finance Officer's Association Award for distinguished budget presentation. Debra Fort~ made the presentation to Council. accepted the award for Council and Staff. Mayor Stephens 131 132 City of Denton City Council Minutes July 5, 1988 Page 4 2. The Council considered approval of the minutes for the regular meeting of June 7, 1988 and June 21, 1988. Council Member Ayer noted a typographical error on page one of the June 7, 1988 meeting. He requested a correction. Gorton motion, McAdams second to approve the minutes with the noted correction. Motion carried unanimously. Public Hearings A. The Council considered an ordinance amending the parking regulations of Article 15 of Appendix B-Zoning of the Code of Ordinances of the City of Denton, Texas, to provide for regulations for compact parking spaces; repealing Appendix Illustrations No. 13 and 13A of Appendix B-Zoning; providing for a maximum penalty of ~2,000 for violations thereof; and providing for an effective date. (The Planning and Zoning Commission recommended approval.) The Mayor opened the public hearing. No one spoke in favor. No one spoke in opposition. The Mayor closed the public hearing. Cecile Carson, Urban Planner, stated that the ordinance was in conjunction with the Subdivision Regulations. The purpose of the ordinance was to provide for compact parking spaces with a maximum of 10% of the required parking allowed for compact parking spaces. The Planning and Zoning Commission recommended approval with a 7-0 vote. Mayor Stephens asked if the spaces were required to be marked for compact cars only. Carson replied that this ordinance had no requirements for the spaces to be marked but that it was noted in the Subdivision Regulations that the spaces would be marked. Mayor Stephens stated that he would like to have that language included in the ordinance for further clarification. Hopkins motion, Gorton second to postpone consideration of the ordinance until the next regular meeting for rewording and clarification. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. City of Denton City Council Minutes July 5, 1988 Page 5 B. The Council considered a petition of Vera T. Gershner requesting a variance of Article 4.03 of the City of Denton Subdivision and Land Development Regulations at 2312 Stonegate. This property was further described as Lot 4, Block B, in The Ridge of Southridge Addition. Article 4.03 required the maximum residential driveway approach to be 20 feet. The petitioner was requesting a 38 foot driveway approach to a garage fronting on Hollyhill Drive. V-45 (The Planning and Zoning Commission recommended approval, the Citizens Traffic Safety Support Commission recommended denial.) The Mayor opened the public hearing. Dr. Vera T. Gershner spoke in favor of the petition. She stated that she was requesting a 38' wide driveway. She was in need of a wider driveway as a family member was confined to a wheelchair. The problem arose when they sought approval for a curb cut. No one spoke in opposition. The Mayor closed the public hearing. Elizabeth Evans, Planning Administrator, stated that the Planning and Zoning Commission approved the request for variance with a 5-0 vote to allow a 38' wide driveway approach. Gorton motion, Alexander second to grant the request for variance. On roll vote, McAdams "aye," Alexander "aYe," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. City Attorney Drayovitch stated that Council needed to complete the variance request form included in the backup materials. Conditions for the variance needed to be noted. Gorton motion, Alexander second to accept the wording as presented to the Council from the Planning and Zoning Commission as rational for granting the variance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. (Exhibit B) Consent Agenda Mayor Stephens requested that Items 4.A.3. and 4.C.1. be removed for special consideration. 133 134 City of Denton City Council Minutes July 5, 1988 Page 6 Hopkins motion, McAdams second to approve the Consent Agenda as presented with the exception of Items 4.A.3. and 4.C.1. Motion carried unanimously. A. Bids and Purchase Orders: 1. Bid #9874 - Wire & Cable 2. Bid #9872 - Electronic Pulse Recording System 4. P.O. #84943 - Freese & Nichols B. Plats and Replats Consider approval of preliminary plat of the Frank Borman Elementary School Addition, Lot 1, Block A. (The Planning and Zoning Commission recommended approval.) e Consider approval of preliminary and final replat of Lots 2, 3, 5, 7, 8, 9, 10, 11, 12, 13, and 14, to Lots 2, 3A, 3B, 5, 7, 8A, 8B, 8C, 9A, 9B, 10, 11, 12, 13, and 14A, Section One; and Lots 15, 16, 19, and 20 to Lots 14B, 15, 16, 19 and 20, Section Two, of the Solar Way Addition. (The Planning and Zoning Commission recommended approval.) The Council considered Item 4.A.3. Mayor Stephens questioned the wording in the back-up material which stated that the cost of the bags were 44.20 per bag. John Marshall, Purchasing Agent, stated that the cost should have been stated as 44.20 per roll. Stephens motion, Alexander second to approve Consent Agenda Item 4.A.3. Motion carried unanimously. 3. P.O. #84937 - Arrow Industries The Council considered Item 4.C.1. Mayor Stephens questioned the discrepancy between the amount of the taxes and the amount of the check for the taxes. John McGrane, Executive Director for Finance, stated that the check was for three parcels of land and not just for the parcel that the refund was being requested for. City of Denton City Council Minutes July 5, 1988 Page 7 Stephens motion, McAdams second to approve Consent Agenda Item 4.C.1. Motion carried unanimously. C. Tax Refund Consider approval of a tax refund to Fleet Mortgage - 41,051.94. 5. Ordinances A. The Council considered adoption of an ordinance accepting competitive bids and providing for the award of contracts for the purchase of materials, equipment, supplies or services. The following ordinance was considered: NO. 88-112 AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING A CONTRACT FOR THE PURCHASE OF MATERIALS~ EQUIPMENT, SUPPLIES OR SERVICES; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motion, Hopkins second to adopt the ordinance. On roll vote, McAdams 'aye," Alexander "aye,' Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. B. The Council considered adoption of an ordinance providing for the expenditure of funds for emergency purchases of materials, equipment, supplies or services in accordance with the provisions of state law exempting such purchases from requirements of competitive bids. The following ordinance was considered: NO. 88-113 AN ORDINANCE PROVIDING FOR THE EXPENDITURE OF FUNDS FOR EMERGENCY PURCHASES OF MATERIALS, EQUIPMENT, SUPPLIES OR SERVICES IN ACCORDANCE WITH THE PROVISIONS OF STATE LAW EXEMPTING SUCH PURCHASES FROM REQUIREMENTS OF COMPETITIVE BIDS; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motion, Hopkins second to adopt the ordinance. On roll vote, McAdams "aye," Alexander 'aye," Hopkins "aye,' Gorton "aye," Ayer "aye," and Mayor gtephen~ "aye." Motion carried unanimously. 135 136 City of Denton City Council Minutes July 5, 1988 Page 8 C. The Council considered adoption of an ordinance authorizing the execution of a contract between the City of Denton and the United States Army Corps of Engineers for access and site activities on the hydropower project at Lewisville Lake. (The Public Utilities Board recommended approval.) The following ordinance was considered: NO. 88-114 AN ORDINANCE AUTHORIZING THE EXECUTION OF A CONTRACT BETWEEN THE CITY OF DENTON AND THE UNITED STATES ARMY CORPS OF ENGINEERS FOR ACCESS AND SITE ACTIVITIES ON THE HYDROPOWER PROJECT AT LEWISVILLE LAKE: PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE: AND PROVIDING FOR AN EFFECTIVE DATE. Bob Nelson, Executive Director for Utilities, stated it was a requirement of the City's Federal Energy Regulatory Commission license that the Corps of Engineers review and approve all the plans for construction and activity at the site. The contract outlined and described all of the various relationships and obligations between the City and the Corps of Engineers regarding the project. Corps required that the City put the money up front to do the review which would be under $60,000. McAdams motion, Alexander second to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. D. The Council considered adoption of an ordinance authorizing the Mayor of the City of Denton, Texas, to execute a mutual use agreement between the City of Denton and the City of Lewisville for an 800mz trunked communication system. The following ordinance was considered: NO. 88-115 AN ORDINANCE AUTHORIZING THE MAYOR OF THE CITY OF DENTON, TEXAS TO EXECUTE A MUTUAL USE AGREEMENT BETWEEN THE CITY OF DENTON AND THE CITY OF LEWISVILLE FOR AN 800 MHz TRUNKED COMMUNICATION SYSTEM; AND PROVIDING AN EFFECTIVE DATE. Rick Svehla, Deputy City Manager, stated that the agreement would allow Denton and Lewisville to use each other's 800 system. This was part of the regulations from the FCC. It dedicated one of the City's channels for Lewisville's use and Lewisville dedicated one of its for the City's use. City of Denton City Council Minutes July 5, 1988 Page 9 McAdams motion, Ayer second to adop~ the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. E. The Council considered adoption of an ordinance authorizing the Mayor of the City of Denton, Texas to execute a mutual use agreement between the City of Denton and the City of Carrollton for an 800mz trunked communication system. The following ordinance was considered: NO. 88-116 AN ORDINANCE AUTHORIZING THE MAYOR OF THE CITY OF DENTON, TEXAS TO EXECUTE A MUTUAL USE AGREEMENT BETWEEN THE CITY OF DENTON AND THE CITY OF CARROLLTON FOR AN 800 MHz TRUNKED COMMUNICATION SYSTEM; AND PROVIDING AN EFFECTIVE DATE. McAdams motion, Alexander second to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens maye." Motion carried unanimously. F. The Council was to have considered adoption of an ordinance authorizing the conveyance of a tract of land consisting of approximately 2907 square feet to Theron Gerald Snider, Jr. and accepting the conveyance of a tract of land consisting of approximately 2905 square feet from Theron Gerald Snider, Jr. The item was pulled by staff from the agenda. 6. Resolutions A. The Council considered approval of a resolution accepting the Water and Wastewater Study Regional Master Plan for Denton County. The following resolution was considered: RESOLUTION NO. R88-041 A RESOLUTION ACCEPTING THE WATER AND WASTEWATER STUDY REGIONAL MASTER PLAN FOR DENTON COUNTY; AND PROVIDING FOR AN EFFECTIVE DATE. 137 138 City of Denton City Council Minutes July 5, 1988 Page 10 Ayer motion, Gorton second to approve the resolution. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. B. The Council considered approval of a resolution authorizing the Mayor to execute a security agreement on behalf of MBank relating to the lease between the City and First Financial Resources, Inc. (The Airport Advisory Board recommended approval). Rick Svehla, Deputy City Manager, stated that this resolution would execute a security agreement. A new owner leased a hanger from the City because the original owner relinquished his lease. The new owner borrowed money to improve the hanger. MBank was seeking a security agreement which stated that if the owner, First Financial, defaulted on the rent, MBank could sub-lease the hanger to someone else. The City would be providing MBank with collateral for the loan it made to First Financial. Debra Drayovitch, City Attorney, noted that there was a section in the lease with First Financial that would allow the City Manager or the Mayor to execute a consent to a security interest, not in the lease hold, but in the actual buildings that were improved. In order to do that, it did not require Council approval but the lease did not authorize crediting a security interest in the lease hold itself. Svehla replied that MBank would still be required to pay the same lease rate to the City that First Financial was paying to the City. If that was not done, then the lease would revert back to the City. Council Member McAdams questioned as to whether the language was clear and certain as to the rights of the City with regard to the property. Drayovitch replied that the lease would allow MBank to only operate the structures where the improvements were made. The security agreement, if First Financial defaulted on the note, would allow MBank to operate for the remainder of the lease. She stated that the way to ~tay fully protected would be to not grant a security agreement. McAdams stated that if the loan had already been granted to First Financial and the improvements had already been done, how did granting the security agreement advantaged the City. Why should the City grant the agreement and on their terms? City of Denton City Council Minutes July 5, 1988 Page 11 Drayovitch replied that it might be best to postpone further discussion on the item until bank's attorney could be contacted because she could not give a reason why the City should or want to execute the document. McAdams motion, Hopkins to postpone consideration of the resolution until the next regular meeting. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. C. The Council considered approval of a resolution accepting the Capital Improvement Plan proposed by the Planning and Zoning Commission. The following resolution was considered: RESOLUTION NO. R88-042 A RESOLUTION ACCEPTING THE CAPITAL PROPOSED BY THE PLANNING AND ZONING PROVIDING FOR AN EFFECTIVE DATE. IMPROVEMENT PLAN COMMISSION; AND Council held a discussion as to the wordin~ of the resolution regarding formal approval of projects beyond the year 1991. It was felt that perhaps the resolution should state that projects beyond 1991 were under consideration and not formally approved. Alexander motion, McAdams second to approve the resolution with the following amendments: Section II to read, "... to be constructed during the forthcoming three year period, and the capital improvement program for the electric and water utilities..." Section III to read, "That the Council hereby takes under consideration the attached list of recommendations of the Planning and Zoning Commission of capital improvements for the years 1991-92 and 1992-93". On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. 7. The Council considered a motion authorizing the City Manager to reallocate unutilized CDBG Administrative and 1986 Morse Street funds to the Housing Rehabilitation Program. (The Community Development Block Grant Committee recommended approval.) 139 140 City of Denton City Council Minutes July 5, 1988 Page 12 Barbara Ross, Community Development Coordinator, stated that the excess 1987 administrative funds and the excess 1986 Morse Street funds would be put into Housing Rehabilitation Program. The amount of money would be approximately ~25,000. McAdams motion, Ayer second to approve the authorization. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. Miscellaneous matters from the City Manager Lloyd Harrell, City Manager, presented the following items: A. Consideration of a motion to confirm an appointment to the Civil Service Commission for a term to expire in 1990. Harrell offered the name of Frank Davila as Civil Service Commissioner for a term to expire in 1990. Hopkins motion, McAdams second to approve the confirmation. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," and Mayor Stephens "aye." Motion carried unanimously. B. Harrell stated that there would be a tour of City facilities on July 12 for any Council Member who might be interested. Council Member Boyd joined the meeting. 9. There was no Executive Session held during the Work Session. 10. New Business No Council Member suggested any items for future agendas. 11. The Council convened into the Executive Session to discuss the following: ae Legal Matters -- Under Sec. 2(e), Art. 6252-17 V.A.T.S . Discussed County v~. Cit~ and Maverick vs. City. Real Estate -- Under Sec. 2(f), Art. 6252-17 V.A.T.S. City of Denton City Council Minutes July 5, 1988 Page 13 Personnel/Board Appointments -- Under Sec. 2(g), Art 6252-17 V.A.T.S. Considered a Denton representative to the Regional Transportation Council. Considered appointments to all City of Denton Boards and Commissions. The Council reconvened into open session and took the following action: A. Hopkins motion, Gorton second to approve the following appointments: Curtis Ramsey - Community Development Block Grant Committee, Dale Maddry - Data Processing Advisory Board, and Fran Morgan - Planning and Zoning Commission. On roll call vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. With no further business, the meeting was adjourned at 10:25 p.m. 141 N'Ni F ~R WALTERS TY SIBCRETARY CITY OF DENTON, TEXAS CITY O~DENTON, TEXAS 2952C ! ~BIT A 1,it.,lOR ISSUES REPORT ON THE PROPOSED 1988-89 BUIIGET SUBMITTED TO CITY COUNCIL Ju~y 5, 1988 Prepared by The Depermen~ o£ Finance Submitted by LLOYD V. HARR~T.T. City~sser 'JTY of DENTON, TEXAS 143 MUNICIPAL BUILDING / DENTON, TEXAS 76201 / TELEPHONE (817) 566-8200 July 5, 1988 TO THE HONORABLE MAYOR AND MEMB~/~S OF CITY COUNCIL AND THE CITIZENS OF DENTON: The purpose of this report is to highlight ~aJor issues affecting the preparation of the 1988-89 budget for the various city funds. The report follows the same format that has been used tn prior years. There is a statement of the major issues, alternatives for dealing with the issues, and recommendations from the staff. Once again, the major factor affecting the budget is the economy. However, the projections for the next fiscal year are more optimistic than those in-the last two years. Preliminary indications from sales tax receipts, unemployment rates, area forecasters and the State Controller's Office are su~gestin$ that the Texas economy has bottomed out and will experience some moderate growth during the next fiscal year. The budget is, therefore, built on revenue forecast based upon this premise. As you are aware, Denton has weathered the recessionary economy of the last two years with little impact on overall city service levels. Although' there was very little impact on service levels, there were a number of projects and programs that were delayed because of the limited resources available. Over the past two fiscal years a backlog of these projects and programs has occurred. The demand for these services has grown even greater this year because of the problems associated with past and anticipated future growth. The theme for the 1988-89 budget is to continue with the same level of general service with moderate expansion of new prosreme where possible. The areas of expansion are primarily areas where City Council had expressed a need for improvement in the 1988-89 Council questionnaire form. The five highest areas of rankin~ were: Area Average Score o Code Enforcement o Beautification Effort o Street MAintenance and Repair o Storm Drainage o Traffic Signalization 7.43 7 · 29 7.14 7.14 7.00 i44 Major Issues Report to Mayor and City Council July 5, 1988 It was not an easy process arriving at preliminary budgeti ~roposals. Every available resource was examined in order to provide for the continuation of service along with moderate expansion in some service areas. With these factors in mind, the draft proposed budget was established with the philosophy of retaining the City's fiscal integrity while keeping current level services and providing attention to the above mentioned concerns. In conjunction with this philosophy the following are some of the major issues impacting this year's budget. MAJOR ISSUES - GENERAL FDND 1. GENERAL FUND RESERVE LEVEL - Over the past few years, the City Council and staff have been committed to bringing the undesignated fund balance of the General Fund to an acceptable level, it was agreed that a generally acceptable undesignated reserve fund balance level would be in the range of eight to ten percent of total expenditures. As you are aware, it is necessary to keep an undesignated reserve in order to allow the City to absorb unexpecte~ losses that may occur from lawsuits, uninsured claims, natural disasters, revenue shortfalls, etc.. Conversely, the reserve should not be so high as to create an undue burden on the taxpayers. The followin~ is an illustration of the past three year's unreserved balances, along with the projected balance for September 30, 1988. General Fund Unreserved Balances % of Total Expenditures As of As of As of Estimated 9/30/85 9/30/86 9/30/87 9/30/88 $1,122,131 $1,515,934 $2,301,690 $2,558,000 6.1% 7.5% 11.43% 11.35% The alternative choices relating to the unreserved fund balance level are: 1. Allow She balance to stay at its current level. 2. Use $270,000 of the fund balance as a resource ~o balance the 1988-89 budget. 3. Use all, or a portion, of the balance to fund one time capital expenditures. Use part of the unrese~ed b~ance aa an o~fset to the Health Insurance _ Fund. -2- 145 Major Issues Report to Mayor and City Council July 5, 1988 Recom~endation: Staff's recommendation is to utilize ":~270,000 of the unreserved balance as a resource to balance the operating budget. This would then bring the estimated fund balance to 9.11% of the proposed budget expenditures. 2. REVENUES - The second major issue deals with General Fund revenues. A. Sales Tax - The draft budget forecasts a 7.2% increase in collections over the c~rrent budget amount of $4,595,000. This increase assumes an estimated current year growth of 2.12% over budget and a 5~ growth for next year. The projected budget of $4,927,091 is $332,091 above the current year budget amount. Part of the estimated increase is based on collections from the sales tax on telecommunication services, and the expanded base on which taxes are collected. It is also anticipated that the economy will grow at a rate of around 3~ for the next fiscal year. B. Property Tax - One of the major revenue sources to the General Fund is the ad valorem tax. The 1988-89 draft budget proposes keeping the actual tax rate at 5.§928 per $100 valuation. This rate will generate 512,838,864 for both debt service payments and operations and maintenance expenditures at a 97% collection rate. However, this is based on a preliminary roll from the County Appraisal District and contains a 2% estimate of potential adjustments to the tax roll prior to the official certification. This number may vary because of the number of the valuation appeals applied for and the potential approval of those appeals. Because of the increase in valuation on the preliminary tax roll, the tax rate of $.5928 will generate 312,838,864 in total ad valorem taxes. Of the total tax amount, $5~172,754 will be needed to pay debt service on the city's General Obligation Bonds, Certificates of Obligation and Contractual Obligations. The amount of debt service for 1988-89 is an increase of $1,027,518 over the 1987-88 debt service amount. The increase is due to the issuance of the $1,100~000 C.O.'s for the 800 MHZ radio system~ the $500,000 airport improvement C.O.'s, the $775~000 equipment Contractual Obligations and the Capital Improvement Program General Obligation Bonds for 1987 and 1988. It was anticipated that the revenue generated from the radio system, the airport leases~ and growth in the tax roll would offset the increased debt service requirements. This revenue has not materialized. In 'fact, only $32,807 of additional property tax revenue for the General Fund operations will be available from a $.5928 levy. For 1988, there is a change in the formula for calculation of the effective tax and the roll back tax rate. -3- Major Issues Report to Mayor and City Council July 5, 1988 Using the preliminary tax roll, the adjusted roll back rate fo~ 1988-89 would be $.6139 per $100 valuation. The property tax alternatives are: 1. Keep the tax rate at its current level of $.5928 per $100 valuation. 2. Reduce the tax rate to the effective rate of $.5459 per $100 valuation. It wou~d be necessary to reduce the proposed budget by $1,171,000. 3.Raise the rate to the 8% roll back limit of $.6139. additional $457,000 worth of revenue. Raco~endation: Staff reco~nendation is to keep the rate at the current level of $.5928 per $100 valuation. Tkis would generate an C. Other Revenues - The only other area of the General Fund where an increase in charges is being recommended is in the cable television franchise. The staff has been in negotiati~ns with the cable television company for over -a year. The purpose of the negotiations is to implement a new franchise agreement. It is anticipated that an accepted franchise agreement should be in place by January 1, 1989. The draft proposed budget incorporates an increase of the franchise taxx revenue in the amount of $41,250. In order to generate this amount, the agreement would raise the franchise rate from 3% to 5% for nine months of the 1988-89 fiscal year. The alternatives for the cable franchise are: 1. Keep the rate current and reduce the budget by $41,250. 2. Raise the franchise tax to 5%. Recom~.ndation: - It is the staff's recommendation to television'franchise tax to 52 effective January 1, 1989. raise the cable 3. NEW FIRE STATION - As has been indicated in the past, the Capital Improvement Program provides for the building of additional fire stations in the 1988-89 fiscal year. However, the Capital Improvement Program does not contain any fundin& for manpower costs associated with the new stations which have been _ estimated at $225,000 yearly. In order to prepare for the opening of the stations, -4- ~aJor Issues Report to ~ayor and City Council July 5, 1988 $75,000 was budgeted for 1986-87 and was put into a reserve accOUnt. 147 The 1987-88 budget provided for another $120,000 which brought the reserve account to $195,000. the 1988-89 The draft proposed budget keeps the funding level at $120,000 for fiscal year, thus bringing the reserve level to $315,000. The alternatives for funding the fire station reserve are: 1. 0nly set aside a portion of the $120,000 in the 1988-89 budget, which would allow for the allocation of funds elsewhere. 2. Set aside $120,000 whichwill bring the reserve level to $315,000. 3. Leave the reserve at $195,000. This would allow $120,000 to be allocated to other programs. 4. Deplete the reserve. This would free up $315,000 to be allocated to other programs. 5. Increase the funding for the fire station to $225,000 which would necessitate $105,000 being taken from other programs. R~commsndation: Staff recommends the fundin~ of the reserve at $120,000 for 1988-89. This would allow the City to build up the reserve and ~ake it easier to meet the manpower costs of $225,000 that will be necessary for the new stations. 4. NEW POSITIONS - In the 1988-89 draft budget proposal there are some new positions recommended which will either pay for all or part of their costs themselves, or are necessary in order to meet the community demand for additional services. All the position requests were closely scrutinized by the entire Executive Review Comm4ttee, Finance Department and the Personnel Department. More than 62.75 requests were adequately Justified, but due to the tight budget, only 13.25 positions were included tn the budget proposal. Although these positions will help in areas of tncreastn~ demand for services, we are still not able to keep up with the growth of the city and continue to fall behind. O~ly those absolutely essential positions that will have the offset of additional revenues, or address critical public service demand areas, are recommended. -5- Major Issues Report to Mayor and City Council July 5, 1988 The positions are as follows: Position Lead Building Technician Department/ Full-Time Division Equivalent Bldg. Operations 1 Main Street Director Planning Dept. 1 Utilities Cost Accounting 1 Accountant Code Enforcement Officer (position funded for 6 months) Public Works 1 Clerk/TTpist PW/En$ineerin8 .50 Civilian Jailers Police 2 Comments Tb/s position is essential in being able to keep up the maintenance of the number of city buildings. Much of the expense for this position will be offset by a de- crease in contractual maintenance expanses. This position will serve as coordinator of the Main Street Program. It will work in con- Junction with the State Main Street Program in an effort to redevelop the downtown area. This position will work with the Utilities Dept. to develop cost accounting information. The Public Utility Board has requested this type of position. Funding will bE provided for by the Utilittei tt-tnistrative transfer. ~ This position will increase our staffing in this area from two to three plus a temporary position which is assigned from Building In- spections. This increased staffing should substantially increase our code enforcement efforts through- out the city. This position is an upgrade from a half-time to a full-time. It will help address the heavy clerical workload in this area as well as ass-ming the clerical assignment for the airport staff. These position will allow us to substantially reduce the amount of time patrol officers must spend processing prisoners into our jail as well as allowing for better security and safety in the Jail area. -6- Major Issues Report to Mayor and City Council July 5, 1988 Position Budget Analyst Department/ Full-Time Division Equivalent Treasury 1 Warrant Officer Police Senior Secretary Legal .5O Receptionist Personnel Adm. 1 149 Comments This position which has been recommended in the past by the auditors will further enhance the availability of staff to do cost benefit analysis, monitor perfor- mance measures and budget analysis. The position will report to the Treasurer who will also assume the title of Budget Officer. Because of the backlog of warrants, this position is necessary and will be off-set by increased warrant collections. This position is necessary because of the increased demand upon the Legal Dept. and will allow the ability to expand the collections area. This position will help with the increased traffic coming into the Personnel Office and will free other staff members for other assignments. Court Clerk Fire Maintenance Mechanic Personnel Generalist (funded for 6 mouths) Municipal Court 1 Fire Operations 1 Personnel 1 -7- This position will help handle the increased workload in the Municipal Court and will be offset by in- creased revenues, This position will provide for a firefi~hter to be reclassified as a fire maintenance mechanic. In order to keep current staffing levels, the vacant firefighter position will be filled. In order to offset the additional position, the Fire Department will not fill the Division Comma-der position formerly held by Paul Reed. This position will help alleviate the current workload of the staff. Primary responsibilities will be in the areas of training assistance, interviewing, salary surveys, research and special projects. 150 Major Issues Report to Mayor and City Council July 5, 1988 Position Clerk/Typist Department/ Full-Time Division Equivalent Police 1 Secretary General .25 Govt. Comments This position will allow increased productivity of the officers assigned in the criminal investi- gation division. There is currently only one secretary assigned to assist the 17 CID Officers within this division. This is an upgrade of the present secretary from half-time to three- quarter time. This upgrade will allow the secretary to handle the increased necessary day-to-day workload currently being done by the City Secretary and the Adminis- trative Secreta~. TOTAL 14.25 Less Position Eliminated 1.0 NET ADDED 13.25 Full Time Equivalent (does not include MI/( positions covered in issue #10) Recammen~ation: It is recommended that the new positions defined above be included in the 1988-89 budget. 5. SALARY ADJUSTMENTS - The next major issue is that of salary increases for employees. There are several possible alternatives for salary increases. The first alternative would be to grant no annual pay adjustments. The second alternative would be to bring the various Job classes to minimum market as determined by the market survey conducted by the Personnel Department. The total impact to the General Fund would be 31,870,302 3. The third alternative would be to grant a percentage increase to the various Job families. Recommendation: Staff recognizes that resources in the 1988-89 fiscal year will once again be limited. However, because there were no salary range adjustments granted in the 1987-88 budget year, staff feels that some adjustment is necessary in order to keep us from falling further behind market. The staff also Major Issues Report to Mayor and City Council July 5, 1988 151 recognizes that because of very large increased health insurance' costs, employees' costs for health care for dependents will be substantially increased next year. Because of these factors, staff is recommending a 4% salary adjustment for all job families except Service/Maintenance, Temporary/Seasonal and Executive. Staff is recommending that the Service/Maintenance classification receive a 5% increase because it is 16% behind actual market average. Staff is also recommending that Executives Feceive a 3% increase and Temporary/Seasonal 0%. The total cost of this proposal to the General Fund would be $594,020. 6. BENEFITS ADJUSTMENT - The benefits adjustment package that is being recommended once again takes into consideration the items that have been postponed in the past because of fiscal constraints. P. ecommendation= The following benefit adjustments are recommended by staff for inclusion in the 1988-89 draft proposed budget~ Benefit Cost 1. TM~S updated $58,300 credit Comment This would bring the city's service credit up-to-date which has not been done since 1984. It is further recommended that a TMRS update be done on an annual basis in future years. 2. Martin Luther $10,178 King, Jr. Holiday This would increase the number of paid holidays for city employees from eight to nine. The $10,178 is for actual overtime pay. Lost productivity costs are estimated to be $103,726. 3. Classification $34,500 system, overhaul The city's job classification system is in critical need of overhauling having iasc been comprehensively reviewed nine years ago. In order to administer wages and salaries, a review should take place at least every five years. The amount budgeted is for 50% of the consultant costs only. The remaining 50% would be incurred in ~iscal year 1989-90. Th~s amount also does not provide costs associated for implementation of recommendations from the consultant. -9- 15 2 Major Issues Report to Mayor and City Council July 5, 1988 Benefit Cost Police Incentive $44,248 Pay (6 months) Fire Holiday Pay Reetoratio~ Fire Incentive Pay (6 months) Fire Pension Plan Increase $52,516 $26,054 $13,142 Comment This would allow for the expansion of th~ police incentive pay program. The current program provides the following incentives: Level/Code Monthly Payments Level 1 $ 30.00 Level 2 $ 45.00 - $ 50.00 The expanded request includes: Certification/Education 30 hours toward a degree Field Training Officer Intermediate Cert. or Assoc. Degree Advanced Certification or Bachelors *Figures are not cumulative Certification Intermediate Advanced Field Training Officer Mo. Payment* $ .00 $ 50.00 $ ~o.o0 $12o.oo This will pemanently address the fire holiday pay issue by granting a pay increase to fire personnel and shifting to a compensa- tory time system for future holidays. The resources in this plan will provide pay__ for the restructuring of the fire education and incentive pay plan. The plan will encourage advanced fire training. The plan will also reward those who seek college level fire tratnin~ in both technical and managerial areas. Below is listed the current and proposed incentive program: Incentive Certification Pay Level Cur Pro Basic/EMT $ 30 $ 0 Intermediate $ 30 $ 50 Advanced $ 45 $ 75 ~aster $ 60 $ lO0 *Paramedic $ 35 $ lO0 *Paramedic pay cumulative with any one fire certification level. The resource for the increase allow for the phase-in process of 1/2~ per year as agreed to by the firefi~hters. State law allows th, firelight,rs to increase their pensi~ contribution to 9I which must be matched b~_~ the city. This increase will put the contribution rate at 8I. -10- Major Issues Report to Mayor and City Council July 5, 1988 153 The total cost to the General packages is $238,938. .%¸ Fund for all of the bensfii adjustment 7. OTHER AGENCY CONTP~IBUTIONS - In the draft proposal, the staff has included the recommendations from the Human Resource Committee. The comau[tree has recommended the funding of four new programs. It has also recommended increases for some current agencies and, in the case of SPAN and Handi-Hop, have recommended a decrease in funding. The requests and recommendations are as follows: Agency Current Fundin~ Levels Requests Denton City County Nursery $ 12,000 $ 15,000 $ 14,000 Friends of the Family 32,000 35,000 33,000 SPAN 35,000 36,000 34,000 ~SVP 6,800 7,500 6,800 Fred Moore Child Care 25,000 26,000 26,000 Handl-Hop 34,707 36,000 34,000 HOPE 3,000 5,000 5,000 Parents Anonymous 0 9,000 1,000 Life Planning/Health Services 0 4,480 4,480 Ann's Haven Hospice 0 12,000 2,000 Denton County Pre-Natal Clinic 0 3,000 3,000 North Texas Alcohol/Drug Service 0 10,000 0 LaLeche League 0 1~190 0 TOTAL 5200,170 $148,.507 $163,280 Recommendations The alternatives are: Keep the level of funding at its current level of $148,507. This would not fund any new programs and would not take into consideration any increases in current funding. This would release 514,773 for other programs. 2. Fund at the recommended level. 3. Reduce below the current funding level. 8. DOWNTOWN DEVELOPMENT - Another major issue is the continuing development of the downtown area. As Council is aware, the City has been trying to establish a Main Street Program over the past year. The 1988-89 draft proposed budget contains a request of $39,587 that will be used in conjunction with any amounts of contributions or in-kind services provided by the downtown merchants to fund the Main Street Program. In addition to the ~39,587 la next year's proposed budget, $10,000 will be carried over from the current fiscal year for total city support of 549,587. The program will allow for the hiring of a Main Street Coordinator. The Director will work in conjunction with the State Main Street Program in order to -11- 154 Major Issues Report to Mayor and City Council July 5, 1988 redevelop the downtown area. The Main Street program relies he~%ily on the activities of its manager, and 64% of the budget goes to the manager's salary. Office space, tentatively valued at $18,000, will be provided by the Downtown Association; $3,500 in furniture and $2,700 in supplies will make the office functional. Main Street training by the State and other organizations is intense and continuous. $3,700 is allocated for training and travel, which will often be transferred to persons and orgam/zations working within the scope of the program. Advertising promotional events is budgeted at $1,000. This funding will not cover all program costs, but represents an opportunity to match or leverage private and other organizations' funding. Special services funding of $5,000 is allocated for historical architecture services, and business consultants or will be used to pay the State a fee for such services, if the State adopts a program for cities over 50,000 in population. The duration of the program should be three to five years. Alternatives regar~ing downtown development are: 1. Increase the tax rate over $.5928 ia order to generate more funds to be allocated to the Main Street Program. 2. Make no allocation for any downtown proposal which will allow the~ $49,58? to be reallocated. Utilize hotel/motel tax receipts for the fundi~ of the Main Street Program. This would allow $49,58? to be re-allocated in the General Fund. 4. Fund the Main Street Program at a total of ~49,587. Recommendation= Staff recommends the funding of $49,587 for the city's share of the Main Street Prosram under the current $ .5928 tax rate. 9. HEALTH INSMCE FUND - The next major issue for the General Fund is the funding of a Subsidy to the Health Insurance Fund. The city health insurance fund is basically a self-insured fund. Over the past several months, the fund has had an enormous amount of "shock loss" claims. Through April 30, 1988, these claims have totalled $292,300. It is projected that by the end of this fiscal year, the deficit in the fund will amount to ~225,000. -12- Major Issues Report to Mayor and City Council July 5, 1988 155 In order to help offset this loss, the Personnel Department 'has made several recommendations to the City Manager. One recommendation calls for a transfer of $170,000 to the Insurance Fund. It also allows for an actuarial study at $30,000. Even with this allocation, indications are that the following increases ~rlll be required of employees durin~ the next five fiscal years. Year Spouse Coverase Dependent Coverase Family Coverage 1988-89 20% 20% 30% 1989-90 20% 20% 30% 1990-91 10% 10% 20% 1991-92 10% 10% 20% 1992-93 10% 10% 20% The General Fund portion of the $200,000 support to the Health Insurance Fund is $111,662. With the transfer allocation and the additions/ employee contributions, the Health Insurance Fund will still have a deficit balance through the year. The proJectgd balances are as follows= Year Amount 1987-88 $ (225,000) 1988-89 $ (137,646) The alternatives regarding support to the Health Insurance Fund are as follows: Do not provide any General Fund support and increase the employee's contribution in order to reduce the deficit. This would allow $111,662 to be allocated elsewhere for other programs, but would require substantial increases in employee contributions. e Se Have the General Fund and other funds with employees contribute the whole amount to make up the current deficit and future year projected deficits. Phase in the contributions from the General Fund over a number of years. Do away with the self-insurance health fund and require that all employees become members of the HHO. Recommendation: Staff recommends the funding of the $170,000 transfer to the Health Insurance Fund and $30,000 for an actuarial study. It also recommends the increases for employee contributions as mentioned above. -13- 156 Major Issues Report to Mayor and City Council July 5, 1988 10. MARTIN LUTHER KING RECREATION CENTER - As Council ,is aware, it is: projected that the Martin Luther King Center will be ready to open in December, 1988. The building of the center was provided for through Capital Improvement Funds and Community Development Block Grant funds. However, those funds did not provide for any operation and maintenance costs of the center. The center will be approximately 20,000 square feet in size which is 8,000 square feet larger than the current recreational centers. This will mean increased maintenance and utility costs for the additional square footage. Although there is a larger amount of square footage, the staffing level will be only slightly more than that at the other centers. In addition, the hours of operation will be the same as the other recreational centers. The draft proposed budget includes funding of $28,936 for a recreation specialist with the primary emphasis on youth athletics, a recreation leader with a speciality in general children programs for $18,967, and also includes funding of $5,754 for building attendants. Total personal services cost is $53,657. Additional costs for supplies, services, utilities and pay back on the loan for the heating system amount to $54,331. In addition there is *22,600 for maintenance and $12,600 for custodial services funded in the Building Operations budget. Thus, General Fund support for the Center totals $143,188. In addition to the General~ Fund support, additional equipment for the center will be paid for from the Community Development Block Grand Fund and the Recreation Fund. in the amount of $100,000 and $50,000, respectively. This brings the total funding for equipment and fixed assets at the Center to $160,000. The initial General Fund request for the operation, maintenance, and equipment costs for the Martin Luther K/ng Center was $232,524 which provided for 79 hours of operation as compared to 71 hours at North Lakes and 66. hours at Den/a and substantially more personnel. The reduced package recommends 66 hours of operation for the MLK Center. Total initial requests from all funding sources was $362,524. Of this amount, $205,450 was requested for additional equipment and fixed assets. The Executive Staff reviewed the proposal from the Parks & Recreation Department for the funding and had reduced the amount to a total of $143,188. The alternatives for the MLK Center are: 1. Delay opening of the center un,il after December 1, 1966 and use the savings from that elsewhere in the General Fund. 2. Fund the MLK Center at the original request. This would add an increase oi---~ $23,886 to the General Fund for operation and $65,450 for capital equipment. -14- Major Issues Report to Mayor and City Council July 5, 1988 R~commendation: Staff recommends that the Center be the draft proposed budget in the amount of $143,088. 157 Fund at the reduced level for phase equipment proposals and staffing over a two year period. funded as presented in 11. BEAUTIFICATION IMPROVEMENTS - In order to address the concerns of City Council for' improved beautification efforts, the draft proposed budget has added ~wo new positions. The first position is an additional code enforcement officer funded for six months. This position will allow the city to better regulate code violations through improved citation issuance and enforcement. It is anticipated that this position will generate $2,500 in additional fines which will help offset some of the costs of the additional position. The addition of one officer will bring the total number of code enforcement officers to four. However, one of the officers is a plan eTamtuer borrowed from the Engineering Division. If the workload in the Engineering Division increases, it may require the plans examiner to be recalled to that division sometime during the year. The second position is proposed by reorganizing the staffing of the Planning Department which allows for the hiring of a f-Il-time senior planner. This position will be able to assist the Parks Department by completing a bikeway and sidewalk plan. The other beautification effort of the senior planner will be to develop an entrance way plan as recommended by the Beautification Com~ittee. Other efforts considered as part of the budget process but rejected because of the lack of funds were= o Ea~le and Bell Beautification Project $ 8,500 o LillianMiller Parkway Landscapin~ $ 34,840 o Contracted litter pick up in the parks $ 8,568 o Downtown Beautification $ 5,000 o Contract clean-up (litter) $ 30,000 The alternatives for beautification improvements are as follows= 1. Do not fund the new positions. This would allow $27,627 to be allocated elsewhere within the General Fund. 2. Increase the tax rate over the $.5928 and use the increased amounts to do further beautification efforts. 3. Fund one additional position and approve the reorganization. -15- 1.58 Major Issues Report to Mayor and City Council July 5, 1988 Recommendation: Staff recommends that because of the critical need for beautification improvements in the city that the one additional position be funded and the reorganization in the Planning Department take place. 12. VISUAL ARTS CENTER - The city, as part of its contractual obligation with the Greater Denton Arts Council, provides maintenance, utilities and some custodial services fo~ the Visual Arts Center. Custodial support for 1988-89 is budgeted at $3,?50, maintenance support at $12,000 and, utility payments at $17,000. The Arts Council had requested maintenance and improvement items totalling $53,100 as opposed to the $12,000 recommended. The alternatives for the Visual Arts Center are: e Provide the same level 'of support to the Visual Arts Center as we do for other city buildings. This would result in a total allocations of $32,7~0. Fund the requests of $53,100 of maintenance and improvement items as requested by the Greater Denton Arts Council. This would require an additional allocations of $41,100. 3. Investigate modifying the lease agreement with the Greater Denton Arts Council so this level of support could be reduced or elim/nated. Recomendation: Staff's recommendation is to maintain the Visual Arts Center and provide custodial and utility support at the same level as we do for any other city building. 13. TAX EXEMPTIONS FOR PERSONS OVER 65 - City Council has expressed the concern that individuals on fixed incomes, especially those over 65, are generally not able to absorb additional property tax increases. It was discussed by Council that, in order to address this concern consideration be given to increasing the over 65 property tax exemption. The current exemption is $16,000. In the past, City Council has reviewed the proposal to increase the exemption, but because of the tight fiscal constraints has not been able to implement an increase. However, this year Council has established an exemption goal of $25,000 to be implemented over time. Staff has been reviewing options to achieve Council's stated position of increasing the exemption to $25,000. Under the current number of exemptions that are filed, every $1,000 increase would eliminate $13,338 of tax revenue to the' Major Issues Report to Mayor and City Council July 5, 1988 General Fund. be $53,352. 159 If the exemption was increased to $20,000 the tax revenue loss would If the exemption was increased to the target amount of $25,000 the loss of revenues would increase to $120,042. The alternatives for the over 65 exemptions are as follows: 1. Do nothing. Leave the exemption at the current amount of $16,000 and utilize the $13,338 for another purpose. 2. Increase the exemption to $25,000 immediately and eliminate $120,042 of expenditures in the General Fund, or increase the tax rate above $.5928. Se Implement a goal of increasing the exemption by $1,000 to a total of $17,000. Recommendation: Staff's recommendation would be to increase the exemption by $1,000 for the 1988-89 fiscal year. 14. ECONOMIC DEVELOPMENT - The City provides monetary support for a Joint effort between the City and the Chamber of Commerce for economic development (this year proposed at $34,000 and $50,000 for next year). In addition, the City provides approximately 16.6%, or $26,776, of its total Municipal Services Department budget for economic development. The draft proposed budget for 1988-89 continues this level of support. Discussions did occur during the review process concerning the possibility of requiring the Economic Develo~nent Office of the Chamber of Commerce to provide this support for the City of Denton. The alternatives for economic development are: 1. Leave the funding as it is currently allocated. 2. Require the Chamber to assume the activities that are currently being done by the City. This would allow $26,276 to be allocated elsewhere. Increase the City's effort in the area of economic development. Staff's recommendation is to leave the fundin~ at its e Recomndatton: current level. 15. Geographic Information S~stem - Another major issue is the installation of a Geographic Information System. Staff has been reviewing a proposal to develop and install a geographic info~mation system. This is a computerized software system -17- 160 Major Issues 1{eport to Mayor and City Council July 5, 1988 that allows for computerized mapping and informational data retri~val. The system would be the cornerstone system for a number of future automotive functions. The plan that is under development calls for a five year lease/purchase program with phased in operations for various departments. The proposed implementation plan calls for the Utility Department to be the first and only user of the system in 1988-89. The package includes additional hardware equipment for Data Processing, a software geographic information system and additional staff necessary to fully implement the system in the utility area. Total staff cost for the package for the first year is $84,§63. Total first year costs of the package, including personnel, equipment, lease, and license costs, are $246,891. Of the first year cost,' the Utility Fund would provide the entire amount. After the first year program, the annual General Fund portion of the cost of the system will be approximately $120,000 per year for the length of the lease/purchase plan. After the system is purchased, annual maintenance and personnel costs would be required. Alternatives to th~ Geographic Information System are: 1. Do not implement the system. 2. Implement a scaled down version with Utilities being the majority user. This would allow for a limited use system that would be used primarily by the Utility Department. 3. Fund the five year /mplementation lease/purchase program of the Geographic Information System. ~ecos~endation: The staff reco~nendation is to lease/purchase the Geographic Information System on a five year basis, and to fund first year costs with Utility System funds. 16. Transportation En~ineerin~ - The last major issue for the General Fund deals with transportation engineering and traffic signalization. In the draft proposed budget several new packages for the Traffic Engineering Division are recommended. The major addition to the budget is $20,000 for contracting with a traffic consultant. The consultant will review major traffic problems areas in the city and make recommendations as well as examining the traffic implications of private development. In addition to the consultant, there is $20,000 allocated for the purchase of a wedge concrete saw, a hot melt applicator and two Jackb-mmers. This equipment will allow the crews to be more efficient and productive when working in the field on -18- Major Issues Report to Mayor and City Council July 5, 1988 current problem areas. 161 The last new package included is the prop6sal is $5,000 for transportation planning. This program will allow for the purchase of the North Texas Council of Governments' TRANSPLAN/NEDS and TRACS software programs. The TRACS software package is a local area' site impact analysis program which tests the impact of new developments on the local roadway system. The TRANSPLAN/NEDS software program will provide for computer assisted transportation planning. It will aid in.the forecasting capabilities of highway and transit networks. The alternatives for Transportation Engineering are: 1. Eliminate from the budget the new packages. This allows for the reallocation of $45,000 to other areas. 2. Increase the budget allocation for Transportation Engineering. This would necessitate the finding of additional resources or expenditure reductions. 3. ~eep the new package of consulting services, equipment and software in the proposed budge~. Staff's recommendation is to fund the $45,000 of new Reco~endation: packages. MAJOR ISSUES - UTILITY FUND The proposed utility budget for 1988-89 as submitted to the Public Utility Board, shows total revenues for the operating b~dget of $81,923,000 in expenditures and $83,123,000 revenues. New Positions - In the draft proposed budget, the electric department has 6.5 additional positions. This brings the total positions from 14~.0 to 146.5. Total additional cost for these positions is $114,111. The positions are as follows: 1. Computer Administrator. The primary responsibility of this position will be to act as the project manager for the AM-FM, Geographic Info~mation System for the Utility Department. It will assist in the design of the specifications for the system and will assist in the preparation of the requests for proposals. This position will also help in the oversight of centraliaed computer acquisition, inter-connects and centralized programs, maintenance. Th/s position also will furnish assistance to all utility departments for purchase of future equipment, trouble shooting, and training. -19- Major Issues Report to Mayor and City Council July 5, 1988 2. Secretary/Electric Administration. This secretarial position will provide additional clerical staff to the Electric Utility which includes eight divisions. Included in its area of responsibility w~ll be Energy Management which has been added to the Electric Utility this past year, and the Budget Rate Adm~nistrator functions which have been relocated to the Service Center. The present staff consists of one senior secretary, one secretary and one clerk/typist to serve management .personnel. Due to the additional work load imposed by the load management and customer incentive programs, this position is being recommended for funding in the 1988-89 budget. 3. Special Projects Supervisor/Electric Production. Tkis position will coordinate and supervise the installation and operation of the back up diesel units at the electric power plant. In addition, this position w~ll oversee special projects such as remodeling activities, assessment of building needs and custom construction projects at the plant. 4. Maintenance Apprentice/Electric Production. The maintenanc~ a~prentice will service turbines by checking clearances on components and repairing and replacing damage of unduly worn parts. It will service h/Eh pressure boilers, service condensors (by locating and stopping air leaks), and cleaning tubes. It w~ll also be responsible for the inspection and repair of general planning equipment. 5. Electric Apprentice/Electric Communications. This position is required to have adequate staffing to maintain the radio system for all city departments. 6. Results Engineer/Electric Production. The results engineer w~ll be responsible for the plan and design extension modifications of the Spencer Electric Generation plant. It w~ll act as a project engineer and coordinator of major construction projects a~ Spencer Plan~ and will assis~ in computer programs and computer studies of the Spencer Plant. It will study Plant performance and make recommendations for improvements. 7. Admtutetrattve Assistant/Electric Adm~n/strattou. Thle poetttou is a permanent part-time position which w~ll report to the Executive Dlrector of Utilities. The position will be utilized to perform routine tasks including document research, prepare reports, graphs, and charts as required. It w~ll gather factual and/or statistical data, investigate customer complaints, analyze findings and take the necessary action. Major Issues Report to Mayor and City Council July 5, 1988 The Water/Waste Water Department currently has budgeted for the addition of seven and one-half positions. This brings the total positions from 108.25 to 115.75 Total additional cost for these positions is $182,015. 1. Administrative Assistant in Waste Water Administration. This position would bring to the Waste Water utility a full time position which is currently being shared by Water/Waste Water and Electric Utilities divisions. The individual will act as. secretary of the Denton County Water Study and as laision between the Utilities Department and Customer Service division. 2. Geographical Information System Technician/Waste Water Engineering. This position will allow for the gathering, coding and input of data bases for the new AM-FM Geographic Information System. This position will also review data to insure for accuracy. 3. Civil Engineer/Waste Water Engineering. This position will be responsible for engineering design, analysis construction and facilities management. It will also be responsible fo. management of consultant services and special assignments. This will allow the present engineering staff to work less overtime hours and reduce the dependency on outside services. 4. Light Equipment Operator/Sewer Collection. This position will provide support personnel to implement OSHA standards and highway safety procedure such as barricades and flagging when field work is required. 5. Field Technician/Waste Water Engineering. This position will be responsible for managing and conducting field activities such as sewer filming, sewage flow testing, pressure monitoring, fire hydrant flow/C-Factor testing and leak detection and management of geographical information system. 6. Two Seasonal Technicians/Engineering. These technicians will be responsible for assisting field technicians in sewage flows, testing pressure and monitoring, etc. These positions will allow more in-depth analysis of infiltration and flow analysis to obtain field information as required for meeting deadlines and will allow the office technicians to meet deadlines within the office. This will be funded at .25 full time equivalent 7. Light Equipment Operator/Water Distribution. This will allow utilities to provide for implementation procedures initiated by OSHA and standards in highway safety procedures. -21- ,16 4 Major Issues Report to Mayor and City Council July 5, 1988 8. Water Treatment Plant Maintenance Technician/Water. This position will provide on site maintenance at the new Ray Roberts Water Treatment Plant. The' plant is scheduled to be operational by May, 1991. In order to allow for necessary training and development for this technical position, it will be involved with the construction and implement phases of the new plant. The position will be filled approximately October/November 1988. Construction should begin in February, 1989. ELECTRIC SUMMARY No rats increase or decrease is planned in electric rates for 1989. However, the opportunity for refund exists in the 1988 fiscal year. During fiscal year 1988, variable fuel costs lessened the 2.0t per KNH charge due to the ability to purchase natural gas on the spot market prices less than contract prices. A refund of approximately 5.251 or .4~ per K~H will reduce 1988 revenues by $2,888,000. The staff is currently looking at ways to be able to refund this amount to the utility customers. This will also have significant savings in the General Fund because the General Fund is a larse user of electric utilities for ica city buildings and street lighting program. The savings to the General Fund were used as resources for the 1988-89 budget. WATER SU~_ ~Y An 8.5% increase in water rates is projected effective in October, 1988. This will be the last half of the increase needed to pay the cost for the Ray Roberts Project with the first half occurring in 1987-88. A water rate study is presently under way to determine the cost allocations and rate design for specific customer classes. The water department budget is based on revenues of $10,119,000 with expenditures of $10,198,000. The large increase in expenditures is due to RaY Roberts payments. The fiscal year 1989 payment will be $1,882,000. WASTE~ATERSU~iRY No change is proposed for the sewer rate. Total expenditures budgeted at $6,169,000. Total revenues estimated at ~6,270,000. for 1989 are -22- Major Issues Keport to Mayor and City Council July 5, 1988 SANITATION FDND 165 The Solid Waste Department performs the function of collecting and disposing of all residential and the majority of commercial refuse generated in the city. The department is composed of residential collections, commercial collections and disposal divisions. The rates for the residential service will remain at the same level. The commercial rates will increase April 1, 1989 based on the proposal that was submitted to Council earlier this year. The plan was a ~wo-step phased approach that called for $.74 per cubic yard increase in roll-off charges and $.13 per cubic yard for dumpeters in this fiscal year and an additional $.?4 and $.12 increases respectively for 1989. It is anticipated in the 1988-89 budget that $7,050 will be collected from various recycling programs and should significantly exceed the cost of the operation of the program. Any excess revenues from the program are pledged to furthering beautification efforts. On the expenditure.side, the additional packages provided in next year's budget are one additional commercial truck driver, additional trash receptacles for the square at a cost of $1,840, "Help Keep Denton Clean" signs at at cost of $750 and, an expanded recycling program and a $1,000 reward for recycling. The expanded recycling program will expand the current recycling program to include the collection of computer paper from selected sites. The $1,000 reward program for recycling news print will institute a program where a customer will receive a monetary reward for recycling. This program has been very successful in other cities and can be funded from the recycling revenues. The cost for the additional position of commercial truck driver is $25,854 and will be offset by a decrease in overtime costs. SUN~ARY This has been a very difficult budgeting process as indicated in the major issues report. Some minor service levels were not restored in the current funding level so that moderate new programs could be instituted. There are a few new positions added to the budget which will allow us to address areas that have become an increasing concern over the past two fiscal years. This repart has been an -23- 166 ~ajor Issues Keport to Mayor and City Council July 5, 1988 attempt to bring these issues to the forefront and highlight thew so that Council can discuss these issues, and if corrective measures are necessary, it will allow' for discussion and proper decision prior to the submission of the proposed annual program of services for 1988-89. Should you desire any additional information, or have questions prior to the presentation of this report at the Council Work Session, please contact John McGrane, the staff, or me, and we will be more than happy to assist you. Lloydt~. ltarrell / JFMcG: LVH: a f 3561F -24- EXHIBIT CITY COUNCIL CITY OF DENTON~ TEXAS V-45 The City Council held a public hearing on July 5, 1988 to consider the petition of Vera T. Gershner requesting a variance of Article 4.03 of Appendix A of the Code of Ordinances of the City of Denton, Texas. After consideration and discussion of the following criteria, the Council approved the variance by a vote of 6-0 at its meeting on July 5, 1988. The Council based its decision on the following responses to the criteria: 1. Granting of the request would not violate any master plans. No master plans apply to driveway approaches. 167 The special or peculiar conditions upon which the request is based relate to the topography, shape, or other unique physical features of the prop- erty, which are not generally common to other properties. Dr. Gershner has had a home built with a four car 8arase. The house and sarape were designed to be handicapped assessible. An error was made when the site plan was reviewed. The error was recosnized when the contractor applied for a curb cut permit. This permit was not applied for until the house and ~ara~e were complete. Hollyhill at this location has only 4 houses which would be affected. The special or peculiar conditions upon which the request is based did not result from or were not created by the owner's or any prior owner's action or omission. The owner was not at fault for the desisn of the house and garage in relation to the City ordinances, but will be the one who has to live with the results.