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Minutes February 11, 2003CITY OF DENTON CITY COUNCIL M1NUTES February 11, 2003 After determining that a quorum was present, the City Council convened in a Planning Session on Tuesday, February 11, 2003 at 4:30 p.m. in the City Council Work Session Room at City Hall. PRESENT: Mayor Brock, Mayor Pro Tern Burroughs, Council Members Fulton, McNeill, Montgomery, Phillips, Redmon ABSENT: None 1. The Council received a report, held a discussion, and gave staff direction regarding a multi-year financial forecast, municipal operations funding, budget process, and capital items. Kathy DuBose, Assistant City Manager of Fiscal and Municipal Services, reviewed the financial makeup of the City. She stated that the City's budget was made up of Utilities, Debt Service, General Fund, Internal Services (captures the cost of services provided), and Other (represents grants and contributions). DuBose stated that the General Fund was made up of the following Major Departments that serviced the community - Police, Fire, Streets/Traffic/Engineering, Parks, and Library. These made up 75% of the General Fund budget. She reviewed the appraisal roll comparisons for the past several years. Property tax was 21% of the General Fund budget. Sales tax was about 27% of the General Fund budget. DuBose stated that Assumptions were based on Revenues, Expenditures, and the Capital Improvement Program. Revenues included: No property tax rate increase. Sales Tax increase at 3%. Franchises - Electric, Water and Wastewater Utilities based on rate revenue. External Utilities based on 5% growth. Fines, Fees, Licenses, Permits, and Miscellaneous Revenues increases ranged from 2% to 5%. Return on Investment based on Utility Revenue projections. Expenditures included: No personal services increases for next fiscal year and 4% for years 2-5. Health insurance increase at 30% for next fiscal year and 20% for years 2-5. Electric, Water, Wastewater, and Solid Waste based on Utilities projections. Lone Star Gas increase at 5%. No new positions except for Capital Improvement Program (CIP) related. Ross Chadwick, Fire Chief, reviewed some of the changes proposed in the Capital Improvement Program. He stated that based on the low call activity in the area and unknown alignment of the connector road between 1-35 and 377, construction of Fire Station 7 would be postponed until 2006. The hiring of 15 firefighters scheduled for 2003 would be postponed until 2005. Chadwick stated that the City would provide training for a Citizen Emergency Response Team for the southwest portion of the city and an interlocal agreement with the Argyle Fire Department for ambulance services. Chadwick stated that the Fire Department would purchase land for a fire training facility and design the facility in 2003. Construction of the facility would be scheduled for 2004. A training chief would be hired in 2003. A medic for Station 7 would be hired after 2007. City of Denton City Council Minutes February 11, 2003 Page 2 Mayor Brock requested a report on the ISO rating. DuBose stated that renovations to the Emily Fowler Library would be completed in 2005. Staff from Emily Fowler would be moved to the North Branch Library while Emily Fowler was being renovated. No new employees would need to be hired for the North Branch Library next fiscal year. DuBose stated that for ad valorem growth they tried to maintain 9% over the forecast. that the budget priorities established during the budget process last year were development, street maintenance, public safety training, and compensation-year 1. She stated economic Jim Coulter, Director of Water Utilities, briefed the Council on Street Maintenance. He stated that the current policy of deferring maintenance could cost the City $11-12 million per year. He stated that at the current street maintenance budget, streets would deteriorate faster than they could be maintained. An increase of materials budget for streets would reduce the cost of deferred maintenance. DuBose reviewed the unfunded needs: street maintenance, no compensation for year 1, and new positions - related to growth. Council Member McNeill stated that he was not comfortable with not adding any positions for police and fire as the city grew. Council Member Phillips felt there was a need to do an overall management study, take a look at all departments and the alignment of them. Howard Martin, Assistant City Manager of Utilities, reviewed the impact fee/rate options for water utilities. He stated that the Public Utilities Board recommended utilizing the calculated credit methodology. With this option, there would be a small rate increase in 2005. Martin stated that staff recommended using the calculated credit methodology for meters over 3". He stated that PUB recommended two separate impact fee zones for wastewater to include Hickory/Pecan Creek and Clear Creek. With this option there would be a small rate increase in 2007. Mayor Brock stated that previous councils, when looking at new growth, had expressed their desire to not penalize existing residents with raised taxes but look at possible impact fees for new residents to pay. Martin reviewed the Solid Waste rate projections. Mike Conduff, City Manager, recapped budget concerns for the Council: Streets were a priority item. If funding could be found, the Council was still interested in a management study. Salary increases for employees was still a concern. The Council also expressed concern about being the most expensive city in the area for impact fees. City of Demon City Council Minutes February 11, 2003 Page 3 With no further business, the meeting was adjourned at 6:45 p.m. EUL1NEBROCK MAYOR CITY OFDENTON, TEXAS JANE RICHARDSON ASSISTANT CITY SECRETARY CITY OF DENTON, TEXAS