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HomeMy WebLinkAboutMIN 03.24.2008 CC-WThe City Council of the City of Georgetown, Texas, met in Regular Session on the above date with Mayor Gary Nelon presiding. Council Present: Council Absent: Patty Eason, Gabe Sansing, Keith Brainard, Bill All Council present. Sattler, Pat Berryman, Farley Snell, Ben Oliver Staff Present. Paul Brandenburg, City Manager; Tom Yantis, Assistant City Manager; Patricia E. Carls, City Attorney; Jessica Hamilton, Assistant City Secretary; Micki Rundell, Director of Finance and Administration; David Morgan, Chief of Police; Ken Finn, Animal Services Manager; Terry Jones, Construction Manager; Anthony Lincoln, Fire Chief; Jim Briggs, Assistant City Manager for Utility Operations; Shirley Rinn, Executive Assistant to the City Manager; Elizabeth Cook, Interim Planning and Development Director; Mark Thomas, Economic Development Director Mill 1111 A Discussion and possible direction to staff regarding review of the City Council's current funding policies on Social Service Funding and Youth and Children's Program Funding -- Ben Oliver, District 7 Councilmember; Gabe Sansing, District 2 Councilmember; and Keith Brainard, District 3 Councilmember Oliver reviewed the recommendations given to Counci by the Social Services and Youth Funding committee. He said the first recommendation is to continue with the 1 % for Social Services and 1/8% for Children's and Youth Funding. He said another recommendation is to continue allowing the money to be shifted from one program to another and establish a 10% cap on year-to-year increases. He added a recommendation to actively explore the feasibility of establishing a Trust Fund. He said the sixth and seventh recommendations have to deal with whether or not it might be possible to obtain some of this funding through other means in the general fund. Eason said and Oliver agreed that item 4 iradicates item 1. Mayor added the majority of the subcommittee is recommending a limiting factor of 10% year to year. He said it is still a reference to the 1 % in regard to the formula, but it limits it to no more than a 10% increase. Eason said this would not keep up with the population growth. Brainard said the reason why he raised the objection to this policy is that, while it is simple and easy to understand, by tying social service funding to the general fund , social services and youth services funding ends up becoming a budget driver. He said he wants to replace this policy with one that ties social services and youth services spending to the sum of the rate of inflation and the rate of population growth in the City. Brainard referred to a graph showing how the City's experience with this funding has more than kept up with growth and inflation. Snell noted, in regard to Eason's concern, the 10% cap is for the actual social services budget and it is not on the 1 % of the actual General Fund budget. He said the 1 % placed a ceiling on the amount of money that could be spent each year on the funding. He said the base number from which Council would then make increases does not address the question of whether or not that number was an adequate number to begin with. He added the 1% and 1/8% attempted to give Council an umbrella within which Council could catch up and grow proportionate to the perceived needs. Snell said he does not think the 10% works well. Mayor said we have to have a funding mechanism to balance our budget and that is why Council arrived at a tithing method for social services funding. Snell said the committee has recommended that we stay with the 1 % and 1/8% of the General Fund budget. He added he finds this problematic because the City overbudgeted the youth and children's fund last year by $15,000. He added the City should move money from social services to youth City Council Meeting Minutes/March 24. 2008 Page 1 of 4 Pages program funding. He addea Lne Trust Fund recommendation is a good idea. He said any given amount of money from the 1 %or 1/8% budget could be moved into the Trust Fund and it would be a way to finance the Fund without having to create a separate budgetary mechanism to do so. Brainard said the social services and youth services needs are close to infinite. He added the revenue source for the City, however, is limited and the 10% was created to reflect that fact. Oliver said the subcommittee felt the trust fund was really worth exploring. Oliver said he hopes staff can come back in a timely fashion and let Council know whether or not that is feasible. He said it would be important for staff to look at item seven, which is the possibility of funding some social services through the Utility Fund and other services. He added that he does not believe in the 10% cap unless the City was capping the amount of money spent in any given year in order to use the difference to help fund the Trust Fund. Sansing said he suggested in addition to the 10% cap, another 10% to start the Trust Fund. He added he would like for the youth funding to increase significantly even if it means the City should decrease the social service funding. Mayor asked and Rundell confirmed that staff can look into whether or not the City has the ability to have a trust fund. Motion by Snell, second by Oliver to direct staff to pursue recommendations 5 through 7 and report back to Council in a timely fashion. Berryman said her intent of creating a trust fund would take away the idea of having a subcommittee that decides where all social funding should go. Mayor noted having a trust fund would result in the same kind of decision making process. He added the final decisions are all made by Council. Berryman said the goal is to prevent an influx of applications from coming in all at once. Mayor said the subcommittee only looked at the funding formula, which is separate from the actual criteria and guidelines. He added it would take separate Council action to look at the actual criteria and guidelines. Berryman said with the increasing amount of money for this funding, there will be a growing amount of applications and it would be nice to have a finite amount of money to deal with. Oliver said he seconded Snell's motion because items 1-4 are items for which Council does not need more background information. He added information on items 5 and 7 could fuel more discussion. Sattler said he would like to look at awarding money based upon leverage. He added the City could match the amount of money raised by social services and youth organizations. Mayor said this, again, applies to the spending guidelines and not the funding formula. Snell said each of the groups show in their application what percentage of their total revenue they contribute and how much the City contributes. He added the City's contracts with these organizations would not constitute more than 5% of their funding. Brainard said, with regard to the motion, he would like for staff to address who may invest the money and in what. Snell and Oliver agreed this is a friendly motion. Vote on the motion: Approved 7-0 B Finalize Budget Priorities -- Micki Rundell, Director of Finance and Administration and Paul E. Brandenburg, City Manager Rundell gave Council a handout demonstrating results of the ranking exercise Council submitted. She said the top priority on this list deals with public safety compensation and the least important was to continue to expand and revitalize exisiting neighborhood parks. She said the second listing dealing with the City's new priorities shows the top priority as the need to deal with traffic lights and implementing the plan for resource allocation in the fiber system. She reviewed some of the rankings and said the least important was the development of an environmental beautification program. She noted nothing had an average lower than a 2.5. She said only 3 of the Council members gave a response in regard to the police facility, but the top priority for the GCP was the Williams Drive Gateway as well as the engineering for a parking garage in the downtown area. Rundell noted she does not have a good feel for what the City will and will not be able to fund. She added a lot of these projects are one time, some are ongoing, and some are not even in the general fund. She said it is very early in the process and staff is not able to project revenues. Brandenburg added they are not sure what the cut off point is until they have a dollar amount for the new budget. He said staff will try to budget according to the priorities given by Council. Mayor said, last year, Council went through this process and Brandenburg came back with a new ranking according to what could be funded within the confines of the budget. Mayor asked and Rundell said Council will have the first budget overview in May. She said a lot of the revenue depends on the weather because a large portion of the general fund budget comes from the 10% return on utilities. She noted it is sometimes easier to fund the one time projects than the ongoing projects. Snell said it would be nice if the general fund money was separated out from the utility funds, because Council pays more attention to the general fund money in terms of budget building. Brandenburg said that was done last year. Rundell added, in some cases, the money is allocated, which will be discussed at the next Workshop. Mayor suggested staff seperate the two funds when they come back to Council. C Presentation and update of the City's current outstanding and proposed debt obligations -- Micki Rundell, Director Finance & Administration With a slide presentation, Rundell gave Council a debt update. She said the update will include the different types of debt the City issues, the current City debt condiitons, and the upcoming debt issues. She told Council about the types of debt, including general obligation debt and certificates of obligation. Snell asked and Rundell confirmed that, with 4B, there is an agreement in which both Council and GTEC approve the bonds. She noted City Council Meeting Minutes/March 24. 2008 Page 2 of 4 Pages our CO/GO debt outstanding is $52,326,112 of the tax supported amount. She added $20,810,000 of that amount is part of the City's voter approved GO bonds from 2004. She added the City also has $21,068,888 of self-supporting CO bonds outstanding, the majority of which is GTEC. She noted, historically, as the City has grown it has issued more debt. She said the general debt capacity is $1.50 per $100 valuation. She added the City only uses $.15337 of allowable levy, which is about 11 % of the total allowable amount. Snell asked and Rundell confirmed the Legislature only allows $1.50 on the GO side. Rundell outlined where all of the debt goes. She said the majority is for City facilities, but some has been for public safety related to vehicles. Rundell displayed a graph that showed the increase in both self supported and tax supported debt over the past ten years. She described capital leases and said the City has one, which is for the VoIP telephone system. Rundell explained revenue bonds and said they are bonds that the City issues for utility improvements. She noted the outstanding balances are $23.8 million for the electric utility and $ 27.2 for water services. She said our utility revenue bond coverage is projected at 3.15. She noted this amount fluctuates because of the changes in revenue. She said the City's revenue debt has stayed level over the past 10 years. She noted electric services have gone up significantly over the past three years. She spoke about bond ratings and said rating agencies review the City's financial and management conditions. She added they determine the City's "credit worthiness." She said the City's current bond rating is A2 from Moody's and a AA- from Standard and Poors. She noted we have the same rating as the City of Austin. She said our total tax -supported debt per capita, which includes self-supporting debt, is $1,656 for 06/07. She noted, if you take the self supporting debt out, $1,181 is funded through property tax. She noted our assessed valuation continues to grow. Sattler asked and Rundell said the new properties for this past year total $336 million. Sattler asked and Rundell said the frozen portion of this on the homestead side is approximately 24% of the total. Brainard asked and Rundell confirmed this assessed valuation includes everthing such as households and commercial. Rundell outlined the total tax supported debt compared to general sales tax revenue growth. She said the revenue from sales tax continues to stay in line with the debt growth. She noted the city assets net of related debt. Rundell spoke about the debt to assessed valuation comparison to other surrounding cities. Sattler asked and Rundell explained Temple and San Marcos have a lower assessed valuation because they may have more debt and not as much valuation that offsets that debt. Rundell said the utility customer growth has continued to increase. She noted the otustanding utility debt per customer is about $927. Rundell showed Council the total electric debt compared to electric assets. She noted our electric assets are much higher than our electric debt. She said our water services assets are even better compared to debt. Rundell spoke about the upcoming debt issue. She said the total net proceeds from the 2008 Bond Issue is going to be a little over $14.4 million. She said the revenue bonds are the largest piece of this at $9.2 million. She added we also have $5.2 million of Certificates of Obligation. She outlined the various facility related projects such as parking lot renovations, design renovation of the old library building, and the completion of HSUS kennel upgrades at the Animal Shelter. She said the City funds a portion of the public service vehicles and equipment through certificates of obligation. She noted the debt service is matched to the life of the asset. Brainard asked and Rundell confirmed that the City does pay for some of the vehicles with cash and not certificates of obligation. She added any vehicles that are not for public safety are funded through internal service funds. Sattler asked and Rundell said the equipment for Fire Station #5 will not be issued until next year or the year after. Rundell outlined the next steps in the debt issuance process including upcoming important dates. Snell said and Rundell confirmed it is impossible to separate the taxes that are a result of the citizens authorizing Council to borrow money and spend it and the taxes the City imposes on the citizens by doing certificates of obligation. Rundell said the City tries to educate the public on what percentage of the taxes they voted on. Brainard asked and Rundell said a good estimate of debt issuance cost is about 10%. Brainard added the City has a very impressive balance sheet and it should pay cash at every opportunity possible. Sattler asked and Rundell said the percent at which we are borrowing depends on the market but it will probably be around 4.25% to 4.4%. Sattler asked and Rundell said there is no difference between borrowing on GOs or COs. She said the credit worthiness of the City stands behind both. Sattler asked and Rundell said utilities are becoming a much more important part of funding the budget. She added the City's utility growth is coming from both residential and industrial. Mayor mentioned our bond ratings increase and said it would take the City getting to 300,000 in population to reach the next rating. D Presentation by the Animal Shelter Advisory Board regarding dog tethering issues in the community and the possible need for anti -tethering ordinances -- Ken Finn, animal Services Manager and David Morgan, Chief of Police Finn introduced a member of the Animal Shelter Advisory Board, Christy Hullum. Hullum said the Advisory Board started discussing dog tethering about a year ago and decided it needed further action. She showed a slide presentation explaining what dog tethering is and the dangers and concerns that it entails. She said they are addressing dogs who are living on a chain full time. She added dog tethering is dangerous and inhumane for both people and the dogs. She said the Center for Disease Control states that chained dogs are 2.8 times more likely to bite, and victims are most often children as they are smaller and weaker targets. Hullum listed statistics relating to deaths and injuries from dog bites. She noted chained dogs are more dangerous than dogs that are not chained. She added, since chained dogs can not flee, they are going to become aggressive. She outlined the living conditions of tethered dogs. She said the dogs can get entangled in their chains which can keep them from shelter, food, and water. She said many chained dogs live in filthy surrounding that can pose City Council Meeting Minutes/March 24, 2008 Page 3 of 4 Pages as a public health hazard. huilum added chained dogs can be a sign of illegal dog fighting. She said many people say they have their dog chained up because it is a guard dog and she noted this is not a valid excuse. She said the only possible compromise would be a dog trolley system. Huilum referred to the handouts given to Council and directed them to the proposal for a ban on the tethering of dogs. She said the Advisory Board would like to put a ban on the life tethering of dogs. She noted the Board would like to limit tethering to supervised or attended tethering. She said there is no limits to walking on a leash. She said the Board would like to move the dogs into fenced areas and they would propose a minimum of 150 square feet per animal. She added the Board would like to ban all choke collars and provide daily exercise for kenneled dogs. Mayor asked and Hullum said animal control officers will be "policing" this issue. Berryman asked and Finn said there is a statewide ordinance about dog tethering in Texas. Finn said the state law more clearly defines the current state of the anti -cruelty law and it states certain things you can not do in regards to tethering. Finn said they would like to take the Ordinance farther than the State. Berryman asked and Finn said they think about a minimum of a 100 households in Georgetown are impacted by this problem. 5:25 p.m. -- Recessed to Executive Session 6:08 p.m. -- Returned to Open Session and adjourned These minutes were compiled by Assistant City Secretary, Jessica Hamilton. The meeting was adjourned at 06:08 PM. City Council Meeting Minutes/March 24. 2008 Page 4 of 4 Pages ity Secretary Sandra