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Home My WebLink About01-Introduction - OverviewAnnual Operating Plan Element of the Georgetown Century Plan 2006/2007 City of Georgetown, Texas Austin Dallas/Fort Worth San Antonio Lubbock El Paso Amarillo Houston Georgetown Location Georgetown is the northern most “gateway” to the gently rolling hills of Central Texas. While Georgetown offers the amenities and charm of a small community rooted in values of days gone by, it’s strategically and centrally located in the middle of the four major metropolitan areas of Texas. Austin is 26 miles south, Dallas is two hours north, Houston is two hours southeast and San Antonio is just one- and-a-half hours south, placing Georgetown in a very advantageous position for cultural and economic development. Access to Georgetown via the Austin-Bergstrom International Airport and the north/south highway artery of Interstate 35 and east/west highway artery of Highway 29 make traveling to and from Georgetown easy. ANNUAL OPERATING PLAN ELEMENT OF THE GEORGETOWN CENTURY PLAN GEORGETOWN, TEXAS Fiscal Year October 1, 2006 through September 30, 2007 MAYOR Gary Nelon MAYOR PRO TEM Doug Smith District 3 COUNCIL MEMBERS Patty Eason District 1 Gabe Sansing District 2 Doug Smith District 4 Henry Carr District 4 Pat Berryman District 5 Farley Snell District 6 Ben Oliver District 7 CITY MANAGER Paul Brandenburg ASSISTANT CITY MANAGERS Tom Yantis Jim Briggs - Utilities DIVISION DIRECTORS Randy Morrow Community Services Micki Rundell Finance & Administration Anthony Lincoln Fire Department David Morgan Police Department CITY ATTORNEY Patricia E. Carls, Brown & Carls, LLP City of Georgetown City Council 2006/2007 Patty Eason District 1 Gary Nelon Mayor Doug Smith Mayor Pro-Tem District 3 Henry Carr District 4 Pat Berryman District 5 Farley Snell District 6 Ben Oliver District 7 Gabe Sansing District 2 The Mayor and seven City Council members, as the elected representatives of the City of Georgetown, formulate public policy to meet community needs and assure orderly development in the City. The City Council is responsible for appointing the City Manager, City Attorney, and City Secretary, as well as various citizen boards and commissions. The Government Finance Officers Association of the United States and Canada (GFOA) presented an award for Distinguished Budget Presentation to the City of Georgetown for its annual budget for the fiscal year beginning October 1, 2005. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communications medium. The award is valid for a period of one year only. The City of Georgetown has received the Distinguished Budget Presentation Award for the last seventeen consecutive years. We believe our current Operating Plan continues to conform to program requirements, and we are submitting it to GFOA to determine its eligibility for another award. Mission Statement To preserve and enhance the quality of life and unique character of Georgetown by: Preserving the rich heritage and natural resources; Promoting well-planned development, cost- effective professional management and competent, friendly services; and Protecting its citizens, the environment and all other assets. Table of Contents Councilmembers Budget Award Mission Statement Table of Contents OVERVIEW Transmittal Letter.................................................................................................................... i CITY SUMMARY Georgetown Century Plan Georgetown’s Long-Term Planning Process...................................................................... 1 Council Priorities and Strategies Linked to the Century Plan........................................... 3 Budget Adoption and Management Process..................................................................... 13 Annual Operating Plan Preparation ................................................................................... 15 Organizational Chart............................................................................................................ 16 Community Profile............................................................................................................... 17 Georgetown – Then and Now ............................................................................................. 19 FINANCIAL SUMMARY City Operations by Fund ..................................................................................................... 21 Budgeted Revenues............................................................................................................. 22 Budgeted Expenses............................................................................................................. 23 Program Budget................................................................................................................... 24 Revenues.............................................................................................................................. 26 Fund Summaries.................................................................................................................. 36 COMMUNITY DEVELOPMENT DIVISION Division Financial Summary............................................................................................... 51 Code Enforcement...............................................................................................................52 Building Inspections............................................................................................................ 54 Current Planning.................................................................................................................. 56 Long Range Planning.......................................................................................................... 58 COMMUNITY SERVICES DIVISION Division Financial Summary............................................................................................... 61 Convention and Visitors Bureau ........................................................................................ 62 Main Street............................................................................................................................ 64 Public Library....................................................................................................................... 66 Parks ..................................................................................................................................... 68 Recreation ............................................................................................................................ 70 FINANCE & ADMINISTRATION DIVISION Division Financial Summary............................................................................................... 73 Administration...................................................................................................................... 74 Accounting ........................................................................................................................... 76 Municipal Court.................................................................................................................... 78 Purchasing............................................................................................................................ 80 Facilities Maintenance.........................................................................................................82 Fleet Management................................................................................................................ 86 Utility Office.......................................................................................................................... 90 FIRE DIVISION Division Financial Summary ...............................................................................................93 Administration......................................................................................................................94 Operations ............................................................................................................................96 GEORGETOWN UTILITY SYSTEMS DIVISION Division Financial Summary ...............................................................................................99 Administration....................................................................................................................100 Energy Services .................................................................................................................102 Systems Engineering.........................................................................................................108 Transportation Services....................................................................................................110 Water Services....................................................................................................................114 Sanitation............................................................................................................................120 MANAGEMENT SERVICES DIVISION Division Financial Summary .............................................................................................123 City Council ........................................................................................................................124 City Manager’s Office.........................................................................................................126 Airport .................................................................................................................................128 Economic Development.....................................................................................................130 General Government Contracts........................................................................................132 Human Resources..............................................................................................................134 Information Technology ....................................................................................................138 Legal Contract....................................................................................................................142 POLICE DIVISION Division Financial Summary .............................................................................................143 Administrative Services Bureau.......................................................................................144 Field Operations Bureau....................................................................................................146 Support Services Bureau ..................................................................................................148 Animal Services..................................................................................................................150 CAPITAL PROJECTS Capital Projects & Five Year Plans...................................................................................153 DEBT Debt Management & Policy...............................................................................................213 Outstanding Debt Summary..............................................................................................214 Outstanding Debt by Type.................................................................................................215 General Debt Service.........................................................................................................216 Utility Debt Service.............................................................................................................218 Utility Revenue Bond Coverage........................................................................................219 Proposed Debt Issues........................................................................................................220 GTEC Debt Service (Blended Component Unit – for Reference Only)..........................221 STATISTICAL Miscellaneous Statistical Data.......................................................................................... 223 Key Indicator Graphs......................................................................................................... 224 Benchmarking Graphs ...................................................................................................... 226 Financial Ratio Graphs...................................................................................................... 228 Certified Property Value.................................................................................................... 230 Certified Taxable Assessed Values.................................................................................. 231 Tax Rates Property Tax Rate Comparison........................................................................... 232 Combined Tax Rate – City of Georgetown......................................................... 233 Total Combined Tax Rate Comparison............................................................... 233 Sales Tax Revenue Analysis............................................................................................. 234 Sales Tax Revenue by Quarter ......................................................................................... 235 Tax Revenues Ten Year History ................................................................................................... 236 Combined Sales and Property Taxes.................................................................. 236 Population .......................................................................................................................... 237 Georgetown’s Top Ten...................................................................................................... 237 Utility Customer Growth.................................................................................................... 238 Utility Revenues................................................................................................................. 239 REFERENCE Fiscal and Budgetary Policy............................................................................................. 241 Personnel Summary by Division 2005-2008.................................................................... 262 Personnel Summary – FTE’s ............................................................................................ 263 Personnel Summary – New Positions Added ................................................................. 264 Program Summary by Fund.............................................................................................. 265 Contingency Reserve Requirements Worksheet............................................................ 268 Transfers Between Funds................................................................................................. 269 Internal Service Premiums................................................................................................ 270 Utility Rate Schedule......................................................................................................... 272 Ordinances......................................................................................................................... 275 GEDCO Budget (for information only)............................................................................. 287 GTEC Budget (for Information only)................................................................................ 288 Advisory Boards & Commissions.................................................................................... 289 ACRONYMS / GLOSSARY / INDEX Commonly Used Acronyms.............................................................................................. 293 Glossary.............................................................................................................................. 294 Index.................................................................................................................................... 300 Overview October 1, 2006 To the Honorable Mayor Nelon, Members of the City Council and Citizens of Georgetown: We are pleased to present to you the adopted Annual Operating Plan Element (Operating Plan) of the Georgetown Century Plan for 2006/07. The Georgetown Century Plan is the comprehensive strategic plan by which Georgetown strives to enhance its quality of life. The Operating Plan is an outline of the programs and services to be provided by the City during the coming year. The Operating Plan continues the direction established by our citizens and the City Council to meet the existing challenges and effectively plan for future needs. It is also an opportunity to ensure energies and resources are directed to the programs, policies and issues that are shaped by the Georgetown Century Plan and prioritized by the City Council. Community Growth – 2005/06 in Review Providing services to a rapidly growing community continues to challenge community leaders. Much headway has been made, as new revenue sources were developed and existing ones expanded. The City’s tax base grew to over $3 billion, while the population topped 44,000. Utility customers have grown to over 22,000 accounts, a 6% growth over last year. The City’s electric utility provides service to the new Premium Outlet Mall and new Scott & White Hospital, both located in the City of Round Rock. New jobs were created as Tasus Texas, a major supplier for the new Toyota plant in San Antonio, opened in January 2006. Retail opportunities also increased as Wolf Ranch and the Rivery shopping areas continued their build out. The historic downtown square continues to be a viable business area within the City with several renovation and redevelopment projects underway. Development continues along Williams Drive to serve the over 6,000 residents of Sun City. Residential growth continues with a record 1,300 new residential building permits issued last year, with over 600 of those being in Sun City. The City annexed over 10,000 acres over the past two years in an attempt to preserve natural areas and ensure quality growth for Georgetown’s gateway areas including along Highway 29 and the new State Highway 130, the new toll road connecting Georgetown to San Antonio, the first phase of which opens in December 2006. Overall, it’s an exciting time to be in Georgetown. The 2006 Citizen Quality of Life Survey 2006 marks the third time the City has conducted the Citizen Quality of Life Survey, a bi-annual survey (previously conducted in 2004 and 2002) to gather citizen input and feedback on City services, as well as, other issues and concerns impacting the community. The success of previous programs and projects implemented over the past five years are also measured. In previous surveys, transportation related issues were the dominating factor influencing the community. In 2006, managing growth and preserving the City’s quality of life, while continuing to enhance economic development became the primary focus. Many of the key findings support continued improvement in reaching the goals outlined in the Georgetown Century Plan. Such as: • 86.8% of respondents said the City is doing an excellent or good job ensuring sufficient green and open spaces throughout the City. • 84.3% of residents feel very safe in Georgetown during the day and 62.3% feel very safe at night. • 74.8% believe the maintenance condition of local streets is good or excellent and 49.6% feel the maintenance condition has improved in the last two years. • 86.6% of respondents rate their overall experiences with City employees as good to excellent. iii DIVISION RESPONSIBLE FOR IMPLEMENTATION 2006/07 COUNCIL PRIORITY GOALS & STRATEGIES Commun i ty Dev Commun i ty Svc s Fi nan c e & Ad m i n Fi r e GUS Mgt Svcs P ol i ce A Continue revitalization and economic development *Implement Master Plan for Williams Drive Gateway redevelopment √√ √ *Create a redevelopment Master Plan for Leander Road/Austin Ave area √√ *Develop a Transit Oriented Development plan √√ *Continue implementation and funding of Wayfinding and Welcome to Georgetown signage program √√ *Implement a comprehensive strategy for community wide property maintenance enforcement √√ B Alleviate traffic congestion *Develop plan for assuming responsibility for signalization of City traffic lights √ *Assist Transportation Advisory Board in developing funding strategies for future road projects √√ √ *Develop plan for implementation of a Northwest Boulevard connection to Austin Avenue √ *Develop and implement a Transit System Master Plan √√ C Continue implementation of Downtown Master Plan *Develop and implement a historic abatement program √√ √ *Construct gateway sign element for north end of downtown on Austin Ave √ *Establish funding plan for on-going landscaping of City parking lots √ *Require newspaper vending machines to be consolidated and visually appealing √ D Improve quality of services while keeping property taxes low *Evaluate options for an updated Customer Information System to continue to provide excellent customer service to our utility customers √√ *Continue implementation of citywide records management system √ *Implement Phase Two of Graphic Information System (GIS) Plan √ *Educate public on renewal of 1/4 cent sales tax for street maintenance in the November 2006 election √√ √ *Renegotiate or investigate a potential new provider for power contracts beyond 2016 √ *Purchase bid tracking software to improve efficiency and ensure a thorough and ethical purchasing process √ E Improve emergency response levels *Continue participation in county wide public safety communications system √√ √ *Implement Year 3 of staffing plan for Public Safety √√ √ *Develop plan to increase public safety compensation toward 100% of Round Rock √√ √ *Implement interlocal fire services agreement with Williamson County Emergency Services District (ESD) #8 √ *Redesign and renovate old warehouse facility for secured evidence storage √√ F Expand and coordinate Parks system *Develop funding plan for Garey Park project √√ *Implement Phase Two of a large community park on the west side of the City √√ *Expand existing IOOF Cemetery and develop a Master Plan of the project √√ *Develop a dog park √ *Complete design and begin construction of the Recreation Center expansion √√ *Purchase river springs property for preservation and conservation √√ *Expand and revitalize neighborhood parks in River Ridge and Katy Crossing √ G Continue efforts for community long-range planning *Complete update of City's comprehensive plan √√ *Develop conservation subdivision ordinances √√ *Continue implementation of voluntary and involuntary annexation plan √√ *Update Parks, Recreation and Open Space Master Plan √√ *Create regulations to implement the Transit Oriented Development, Mixed Use and Williams Drive Gateway land use categories √√ *Continue implementation of Regional Wastewater Master Plan √ *Develop plan for locating future fire stations √√ H Develop an Affordable Housing Program *Hire Affordable Housing Coordinator to develop an Affordable Housing Master Plan √ *Develop funding alternatives for housing rehabilitation and property maintenance √√ *Seek state and federal grant funding for affordable housing programs √√ I Expand recycling opportunities and environmental programs *Upgrade the Citizen’s Collection Station and offer additional recycling opportunities √√ *Develop new programs to encourage recycling and conservation √ J Ensure adequate staffing & competitive compensation for all employees *Review staffing levels for non-public safety departments √ *Develop on-going funding plan to implement market compensation for non-public safety employees √ K Continue implementation of City's Facility Plan *Develop plan and implement 911 Call Boxes at all City facilities √ *Begin design for new Georgetown Utility Systems Electric facility √√ *Upgrade City owned fiber cable system √ *Renovate existing building into the new technology center housing new data and communications centers √√ *Conduct a facilities needs assessment for Police and Municipal Court *Develop a comprehensive landscape design and maintenance program for all City facilities √ L Increase operational efficiency and financial integrity *Prepare a disaster recovery plan and redundancy data backup plan for the City's financial systems √√ *Prepare a citywide information technology disaster recovery plan √ *Develop and implement a service agreement with other local water providers to read and bill water meters of mutual customers √√ *Continue to pursue ownership of all electric substations √ *Develop and implement plan for 24/7 dispatch for substation operations √ *Develop online Benefits Management System √ *Purchase and implement evidence/property management software √ iv BUDGET OVERVIEW The 2006/07 Annual Operating Plan (Budget) is an operational and financial plan for the programs and services provided by the City during the coming year. The proposed $154.4 million budget includes funding for all services, including utilities, as well as capital improvements for the upcoming year. Of that amount, approximately $99.2 million is for continued operations, which includes $30 million for purchased power costs, as well as, $11.4 million for debt payments and $32.8 million for capital improvement projects. Operating interfund charges/transfers, which include internal service fund transfers, are approximately $11 million. The 2006/07 Operating Plan is approximately 7.2% greater than the 2005/06 amended budget. Overall, on-going operating costs increased as a result of new programs to address Council priorities, increased purchased power costs and other fixed operational expenses. • Georgetown Utility Systems (GUS) – 38% increase due to maintenance and contracted expenses that increase in relation to customer growth, including additional funds for street maintenance. Oversight of the City’s sanitation contract was transferred from Finance & Administration. 13 positions will also be added in 2006/07 to accommodate increased demands for service. • Community Development – 8% increase due to one-time funding for long-range planning studies ($200,000), as well as, continued implementation of the Graphic Information System (GIS) plan. A Planner III and an upgrade to the Fire Plan Reviewer is also included to address workload issues. • Fire Services – 13% increase due to increased staffing and compensation for public safety needs. Four new positions are added, with an additional firefighter approved for October 2007 to complete the 3 year staffing plan approved in June 2004. • Management Services – 12% increase for programs for employee market adjustments, retirement and insurance increases, as well as for increased social service contract funding. Also included are funds for an Assistant City Secretary and an Affordable Housing Coordinator to assist in managing new and expanded programs. • Community Services – 9% increase related to the opening of the new City Library in January 2008 which adds 4 new positions, as well as, additional maintenance costs for the newly renovated Community Center. Park improvements at Katy Crossing and River Ridge, and other park capital projects are funded along with a new Recreation Center Specialist to support the increased activity in recreational programming. • Police Services – 13% increase due to increased staffing and compensation for public safety needs. Four positions are added, including 2 police officers and two dispatchers. Four additional police officers are scheduled in October 2007 to complete the 3 year staffing plan approved in June 2004. • Finance and Administration – 11% decrease due to the transfer of Sanitation oversight to GUS. This decrease is offset by the addition of 5 new positions, 4 of which directly support utility services. A General Capital Projects Coordinator is also added to manage various cross-divisional general capital projects. • Capital Improvements - 10% decrease, as prior year included the $10 million Library that was constructed in 2005/06. Major projects for 2007 include the renovation of the previously purchased Williamson County Appraisal District (WCAD) building into a new data/technology and communication center for the City and remodel old warehouse space into a secured police evidence storage area. Utility projects include over $12.7 million of Water Services projects and over $7.4 million of new Electric infrastructure to support system growth. Total Budget per Capita $2,613 $2,752 $2,556 $2,449 $2,679 $2,900 $3,193 $- $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 2000 2001 2002 2003 2004 *2005 *2006 *Projected - 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06* 06/07* Public Safety Compared to General Fund Police Fire General Fund v Assessed Property Valuation in billions 1,427 1,629 1,939 2,116 2,247 2,319 2,643 0 250 500 750 1,000 1,250 1,500 1,750 2,000 2,250 2,500 2,750 99/00 00/01 01/02 02/03 03/04 04/05 05/06 Existing Property New Property • Debt Payments – increased due to the issuance of the 2006 General Obligation Bonds that funded construction of the new Library, as well as, the 2006 Certificates of Obligation Bond that funded other improvements, including the construction of the new Fire Station 1. Debt service for bonds issued by the City on behalf of the Georgetown Transportation Enhancement Corporation (GTEC), the City’s 4B economic development corporation, also flows through the City’s budget. • Interfund Charges – these amounts vary from year to year due to project funding and source of funds. Property Taxes. The City Council adopted a property tax rate of $0.36728 per $100 valuation, which is a 6.7% increase over the effective tax rate. The effective property tax rate (the rate needed to collect the same amount of revenue as last year based upon the current year valuations) is $0.34394 which is .07% less than last year’s adopted rate of $0.34626. The rollback rate, or the highest rate allowable without risking a rollback election is $0.37699. This year’s rate includes $0.0304 of sales tax used to reduce property taxes that offsets $0.0388 in total debt service associated with voter approved general obligation debt for expanded facilities approved in November 2004. Even with this tax rate increase, Georgetown continues to have the lowest municipal tax rate in the Central Texas area. Property Values. The assessed property valuation for 2006/07 is $3.07 billion, which is a 14% overall increase over last year’s adjusted value of $2.68 billion. Of this increase, $267 million is new and annexed property. Existing property values increased 3.6% over last year. The average home value for 2006/07 increased from $166,458 in 2005/06 to $179,064 for 2006/07, a 6.3% increase over prior year. Utility Rates. While the current utility rates continue to support on-going operations in 2006/07, they will be reviewed by staff throughout the first quarter of the fiscal year to address unique issues confronting the various utilities. Recommendations will be presented to City Council in early 2007 for consideration and implementation. Current water and wastewater rates are sufficient to fund the costs of operating the system. Yet several areas are being reviewed for potential adjustments later in the fiscal year. One area under consideration is to revise the methodology used in determining wastewater rates and thereby address concerns related to averaging winter water usage to determine sewer rates. Also under consideration is the adoption of a fixed sewer rate for customers who have wastewater service only. Rates may also be impacted by a program to retrofit areas within the community that are currently on septic system to sanitary sewer. These issues and options will be considered in early January 2007, with any adjustments effective in April 2007. Combined Sales & Property Taxes Property Tax Sales Tax - 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 14,000,000 16,000,000 1996 1997 1998 *1999 2000 2001 2002 2003 2004 **2005 **2006 - 20 40 60 80 100 120 140 160 180 200 00/01 01/02 02/03 03/04 04/05 05/06 06/07 Average Monthly Cost Comparison Electric (1,000 kwh) Drainage Garbage Wastewater (6,000 gal) Water (10,000 gal) vi Sales Tax per Capita $152$147 $124$116 $105$101 $114 $- $20 $40 $60 $80 $100 $120 $140 $160 2001 2002 2003 2004 *2005 *2006 *2007 *Projected Electric rates are currently sufficient to fund the cost of operating and maintaining the system. The Council will consider adjusting the rate components to reflect the actual cost of power in January 2007. Currently, power costs that exceed the amount included in the base rate, set in 2003, are adjusted through a Power Cost Adjustment (PCA). This readjustment will recognize the 2007 estimated cost of power and therefore eliminate the on-going PCA within today’s rate. The average customer should not see a noticeable difference in their bill. Sanitation rates are also being reviewed as the City renegotiates its solid waste contract. Sanitation rates have not been adjusted since 2003/04 while the cost to provide service continues to increase. Any rate changes will be presented before April 2007. Stormwater rates will remain the same. Sales Taxes. The City’s sales tax revenue has increased over 17% in 2005/06 due primarily to revenue generated at Wolf Ranch, an 800,000 square foot retail center developed by Simon Properties that opened in July 2005. The City refunds 53% of the 1% general sales tax generated at Wolf Ranch back to the developer. While increases at Wolf Ranch were expected, during the same period, base line sales tax (without Wolf Ranch) grew by 10%, due mainly to increased sales of building materials. The City projects a 6.9% total increase in sales tax in 2006/07, which includes 5% of growth in non-Wolf Ranch revenue. This projection is based on the continued growth and volatility of the housing market and local economy. While sales tax revenue at Wolf Ranch has been less than originally projected due to slower build out, sales are expected to increase once the Interstate 35 Frontage Road is completed and further build out of the project occurs. Wolf Ranch includes Target, Old Navy and Kohl’s, as well as numerous smaller retailers. Historically, sales tax fluctuations mirror economic conditions. Sales tax now funds 25% of the General Fund operating budget, yet sales tax revenue is the most volatile revenue stream within the General Fund. Therefore, the City monitors this revenue stream closely for any potential shortfalls that could impact the General Fund cash flow. The City budgets a contingency reserve of 90 days of general fund operations, to provide stability should sales tax revenues fall short and has adopted a budget contingency plan as part of its Fiscal and Budgetary Policy. Additional Sales and Use Taxes In May 2001, voters authorized the adoption of an additional sales and use tax within the City at the rate of one-half of one percent, with the proceeds to be used for transportation system improvements to support economic development. This tax became effective October 1, 2001. The additional revenue is not part of the City’s general operating budget, but is budgeted and spent by a non-profit economic development corporation, Georgetown Transportation Enhancement Corporation (GTEC). GTEC was established expressly for the above purpose by the City Council. GTEC’s activities are included in the City’s audited financial statements as a blended component unit. In November 2002, voters authorized the adoption of an additional sales and use tax within the City at the rate of one quarter of one percent, with the proceeds thereof to be used for maintenance of streets in existence at the time of the adoption of the tax. This revenue is included in the City’s operating budget in a Special Revenue Fund. This tax has a four year sunset provision, and will be presented to the voters again in November 2006 for renewal. In May 2005, voters authorized the adoption of an additional sales and use tax within the City at the rate of one eighth of one percent, with the proceeds to be used to promote and develop new and expanded business enterprise on behalf of the City of Georgetown and became effective October 1, 2005. This additional revenue is not part of the City’s operating budget, and is budgeted and spent by a non-profit economic development corporation, Georgetown Economic Development Corporation (GEDCO). This corporation was established by the City Council to oversee this revenue. Activities are included in the City’s audited financial statements as a discretely presented component unit. A copy of GEDCO’s approved 2006/07 budget is included within the reference section of this document vii In May 2005, voters also authorized the adoption of an additional sales and use tax within the City at the rate of one eighth of one percent, with the proceeds to be used for property tax relief. This tax became effective October 1, 2005 and is used in the City’s 2006/07 property tax calculation. Revenue from this sales tax is included in the City’s general operating budget. BUDGET HIGHLIGHTS The major program initiatives, linked to the Council’s priorities (paraphrased in bold italics) for the 2006/07 Annual Operating Plan are outlined as follows: • Community Development The division will continue efforts for community long-range planning by coordinating the completion of the City’s comprehensive plan update begun last year. Development of new ordinances, such as conservation subdivision and transit oriented development will ensure quality growth and preservation of natural areas. The division will also work on continuing the City’s voluntary and involuntary annexation plan. Land use categories will be created for mixed use areas and the Williams Drive Gateway project. Another focus for the division will be for continued revitalization and economic development including creation of a redevelopment Master Plan for the Leander Road / Austin Avenue area. The division will also implement a comprehensive strategy for community wide property maintenance enforcement. Overall, $200,000 has been included in the 2006/07 budget to continue long-range planning efforts. • Community Services This division will continue to expand and coordinate the parks system by developing a funding plan for Garey Park, a 500 acre river-fronting parcel west of the City that is being donated to the City. Continued development of a west side park is included in this budget, along with development of a dog park. Construction of the $10 million expansion of the Recreation Center, to be funded with bonds approved by voters in November 2004 is scheduled to begin late in the fiscal year. An additional $300,000 is included to purchase natural springs along the North San Gabriel River for preservation for future generations. $94,000 is included to build restrooms in Rivery Park. Playground equipment, purchase of trail maintenance and field maintenance equipment are also included in this budget. The division will also open the new 45,000 sq ft City Library in January 2007, adding five additional staff members. • Finance and Administration This division will assist other divisions in the implementation of the Downtown Master Plan by implementing a historic abatement program. The division will also continue implementation of the City’s Facility Plan by overseeing the renovation of a recently purchased building into the new technology center housing both the City’s data and communication centers. The division will also develop a comprehensive landscape design and maintenance program for all City facilities. A disaster recovery plan and redundancy data backup plan for the City’s financial systems will also be implemented to increase operational efficiency and financial integrity. Development of a service agreement with other local water providers to read and bill water meters of mutual customers will also increase efficiency. The Purchasing department will implement bid tracking software, and add a new buyer position ($90,000) to improve the quality of services while keeping the property taxes low. The division will also assist the Transportation Advisory Board in developing funding strategies for future road projects to alleviate traffic congestion. • Fire Services Improving emergency response levels will continue to be the focus for Fire during 2006/07. The interlocal agreement with the Williamson County Emergency Services District 8 (ESD) to provide fire services will be implemented. $190,627 is included to fund four new firefighters to be added in January 2007, with an additional firefighter added in October 2007, thus completing the 3 year staffing program begun in 2003/04. Salaries for civil service employees will increase to 95% of the Round Rock pay scale on October 1, as a part of the City’s plan to ensure adequate staffing and competitive compensation for all employees. Fire will also be involved in the annexation planning to continue efforts for community long-range planning by forecasting the location of future fire stations and to ensure response levels are adequate in newly annexed areas. viii • Georgetown Utility Systems (GUS) Development and implementation of 24/7 dispatch operations for Electric substation operations will increase operational efficiency and financial integrity. Keeping the Electric Fund healthy ensures a good return on investment to the City’s General fund, thereby improving the quality of services while keeping property taxes low. The Street Department, as well as the utility areas, will provide support to implement the master plan for the Williams Drive Gateway, which is an area proposed for revitalization and economic development. The continued conversion of overhead electric lines to underground in the downtown area provides a link to the implementation of the Downtown Master Plan. This division will also provide support to the City’s annexation initiative, and the update of the comprehensive plan. The Water Services Department will continue efforts for community long-range planning through the implementation of the Regional Wastewater Master Plan on the South Fork of the San Gabriel River. The newly relocated sanitation function will expand recycling opportunities and environmental programs through the upgrade of the Citizen’s Recycling Center and development of an education program to inform citizens of existing recycling programs. • Management Services Management Services provides oversight to all divisions and also includes several stand alone departments that are not included elsewhere. Information Technology will work with Finance to expand the City’s records management program, as well as, prepare a citywide technology disaster recovery plan to increase operational efficiency and financial integrity. Human Resources will develop an on-going funding plan to implement market compensation for non- pubic safety personnel and ensure competitive compensation for all employees. Over $77,000 is included for the City Manager to hire an Affordable Housing Coordinator to develop an Affordable Housing Master Plan and develop funding alternatives for housing rehabilitation. An Assistant City Secretary ($33,089) is also funded to improve quality of services. This division will ensure the completion of all strategies outlined in the 2005/06 Operating Plan. • Police Services Police will strive to improve emergency response levels by adding two additional police officers in January 2007 ($129,686) and an additional four officers in October 2007. This completes the 3 year plan to ensure adequate staffing. Competitive compensation is also addressed as funding to increase police salaries to 95% of Round Rock’s pay scale is also included. The old warehouse will be renovated for securing and storing evidence. The division will also be participating in the development of a county wide communications system funded by Williamson County through a Homeland Security grant. Capital Projects Capital improvements make up 22% of the City’s proposed upcoming budget. The major projects, by type of project, are listed below: General Capital Projects General capital projects are those that are funded through the general tax base, versus utility capital projects, funded through utility rates. The following projects are included as general capital projects for 2006/07: • Remodel the old Williamson County Appraisal District (WCAD) Building, purchased in 2005/06, into a City technology and communication center - $2 million • Construct a new Electric Services facility - $1.7 million • Begin design for renovation of the old library building into a new police center - $100,000 • Start up costs for new facilities (Library, Community Center, and Fire Station) - $1.1 million • Downtown improvements - $300,000 • Parkland development - $961,000 Employees Per 1,000 Population 20.59 17.42 16.39 15.83 13.77 13.47 12.20 11.84 11.50 10.92 10.12 0 5 10 15 20 25 1996 1997 1998 1999 2000 2001 2002 2003 2004 *2005 *2006 *Projected ix The Airport will complete construction of a control tower, which is funded through grant funds and revenues from Airport operations. Street Improvements and Maintenance The capital budget for street construction and maintenance is funded through four primary sources: General Fund revenue, quarter cent sales tax for maintenance, service improvement program (SIP) fees and half cent sales tax for transportation improvements for economic development (through Georgetown Transportation Enhancement Corporation- GTEC). The City increased the General Fund contribution to $1.1 million from $825,000 in 2005/06. This amount represents 4% of the General Fund operating budget. The City plans to increase funding to 5% in 2007/08 to increase maintenance for the City’s expanding street network. Over 46% of the City’s street maintenance program is funded by the 1/4 sales and use tax specifically for street maintenance approved by voters in November 2002. This tax will go before the voters again in November 2006 for another 4 year authorization. The City has budgeted projects in the event the tax is renewed. Should the measure fail, adjustments to the budget would be made as a result of reduced funding for maintenance projects. General, 1/4 cent sales tax and SIP funded projects: • Church Street • Elm Street • Pine Street • Myrtle Street • Walnut Street • Ranch Road • Parkway • Main Street Georgetown Transportation Enhancement Corporation (GTEC) projects are included in a separate budget that is adopted by the GTEC board and approved by City Council during the budget adoption process. Projects are administered and managed by City staff. A copy of GTEC’s approved budget is included in the reference section of this document. Utility Capital Projects The City will fund over $20.8 million for utility and infrastructure improvements in 2006/07. The majority of these projects are a part of the City’s on-going capital expansion and upgrades to ensure quality services to the citizens. Electric – Improvements are scheduled throughout the system. Water Services – Improvements include line upgrades, mandated Edward’s Aquifer Recharge Zone testing and repairs, and an upgrade at the Rabbit Hill pump station and upgrades to the San Gabriel Wastewater Treatment Plant. Stormwater – Complete construction of downtown regional ponds and improve the San Gabriel retaining wall. FINANCIAL HIGHLIGHTS The City is committed to sound financial planning and direction, and uses the City’s Fiscal and Budgetary Policy to guide the budget process and financial administration. This policy is reviewed and updated annually as part of the budget process and requires all funds be self-sustaining, meaning on-going operating revenues must fund on-going expenses. Also, the policy has substantial debt coverage requirements. All enterprise funds that have debt commitments are required to maintain 1.5 times coverage, meaning excess operating revenues must equal 1.5 times the Street Maintenance Per Capita $34.40 $46.66 $57.14 $73.27 $82.48 $90.21 $90.88 $54.49 0 20 40 60 80 100 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 - 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 14,000,000 95/96 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 Contingency Reserves x annual debt service payment. The 2006/07 Annual Operating Plan meets the Council's goal that each utility system is a self-supporting operation that provides a desirable and affordable level of service. All of the City’s enterprise funds, including the Airport, are self-supporting and policy compliant in 2006/07. The City-wide contingency reserves have been increased 19.2% from $10.4 million to $12.4 million, due to the increase in the total operating budget. This amount represents 75 days city-wide operating expenses, with $5.35 million for General Fund, representing 90 days of operating expense in this fund. Capital is excluded from the contingency calculation. Revenues. The City's revenues continue to rise due to added property tax revenue resulting from an increased total assessed valuation and increased utility service demands. The City's overall customer base for its electric, sanitation, wastewater and water services has increased at a rate of 5-7% for the last three years. The City continues to conservatively project a 5% increase in revenues for utility growth. Since weather conditions affect the electric and water revenues significantly, revenue projections utilize conservative growth estimates to avoid budget shortfalls, and utilize a rolling average consumption method to factor out any weather aberrations. General Fund. General Fund revenues are expected to increase for 2006/07, through increased property taxes and increases in sales taxes due to new retail development. Return on investment transfers are expected to increase due to overall customer growth and higher revenues in the City’s utility system. Fee adjustments for building inspection fees and parks fees will also contribute towards the increase. Court fines are expected to increase due to increased ticket volume. Other revenues are expected to remain stable through upcoming year. Proposed Debt. The 2006/07 budget includes a total of $14.5 million in new debt issues. $8.5 million in revenue bonds are scheduled to be issued for electric utility infrastructure projects, as well as the San Gabriel Wastewater Treatment Plant upgrade another Water Services infrastructure. Debt will also be issued to renovate the old WCAD building, purchased last year into the City’s new technology and communications center. The total tax supported debt is estimated at $5.8 million, including over $1 million for new park improvements. The City plans to issue these bonds April 2007. In November 2004, voters approved a $22 million bond package that includes a new library, an expanded recreation center and renovation of the City’s community center. These bonds have been issued in stages to mirror cash flow needs and to minimize the impact on property tax rates. Bonds for the library and community center have been issued. The remaining $9.4 million to expand the Recreation Center will be issued in 2007/08 once construction on the project begins. The City’s debt per capita increased this year due to the issuance of these bonds, yet continues to be lower than most comparable cities. The City‘s total tax-supported general debt is expected to be $40.9 million by September 30, 2007. Electric and Water Services Funds. Growth demands continue to impact service levels within the City’s two largest utility funds. Operational costs continue to increase as the infrastructure expands. Annexation within the City’s outlying area requires expansion of City services, and creates additional demands on the City’s existing utility facilities. The City's electric system continues to generate revenues sufficient for operations and maintenance and some system improvements. Growth in the southern most area of the Electric service area will create increased demands on substations in that area. In 2006, the City became the electric provider for several large developments within the City of Round Rock, including a new outlet mall, as well as, a regional hospital. This additional service revenue will not only provide income to the electric utility, but will also increase revenue to the General Fund. These projects are expected to generate over $670,000 in Return on Investment to the General Fund, and thereby benefiting the City without increasing General Fund expenditures. $300 $402 $544 $618 $525 $681 $0 $200 $400 $600 $800 '96 '98 '00 '02 '04 '06 Tax Supported Debt Per Capita Combined Utility Revenues (in millions) 0 2 04 06 08 0 01/02 02/03 03/04 04/05 05/06 Proj 06/07 Electric Water Wastewater Sanitation Stormwater xi Growth, as well as, increased environmental mandates has also impacted the Water Services Fund, which includes the City’s water, wastewater and irrigation utilities. Water utility costs continue to increase due to increased operational costs, as well as increases in long term water supply cost and costs associated with the operation of the Williamson County Raw Water Line. Contracting for additional water with the Brazos River Authority has ensured the availability of a long-term water supply for Georgetown. Expenses in the wastewater utility have increased due to Edwards Aquifer compliance issues and increasing treatment plant operational costs. The expansion of effluent for irrigation purposes, which provides large commercial customers a non-potable water supply for irrigation needs, has been completed to help mitigate the demand on the City’s water plants for treated water. The City continues to pursue options for regional wastewater service on the City’s western boundary and is taking a leadership role in developing methods to promote sanitary sewer service and eliminate the proliferation of septic thus ensuring water quality for the Georgetown area. These actions will become critical as rapid growth continues within the area. The utility debt coverage ratio, a standard measure of utility revenue debt capacity, or the number of times the debt service payment could be funded through net income from the utility, remains healthy at 2.95 times. While this number is slightly less than previous years, the amount is more than adequate to meet the City’s fiscal and budgetary requirement of 1.5 times coverage and the City’s utility bond requirements of 1.35 times coverage. As the City continues its annexation plan, the City’s water and wastewater utilities will be dramatically impacted. The City will annex an additional 6,000 acres before December 2006, to ensure land use control over the critical State Highway 130 area. This annexation will require over $7 million in water and sewer improvements over the next few years to provide service as required under the annexation plans. These improvements will be included in future CIP forecasts. Actual timing and financial liability will be impacted by growth in the area. Airport Fund. The Airport Fund is financially self-supporting and funds its on-going operations, as well as provides a times coverage ratio of 1.55 times for its debt service coverage. The construction of an airport traffic control tower, which is funded 90% through a federal grant administered through the Texas Department of Transportation, will be completed in April 2007. The Airport Master Plan update will be completed 2007, and will include expected improvements to the Airport. Funding needs and a financial plan will be considered in the adoption of the updated Plan. Internal Service Funds. The internal service funds provide administrative services and asset management for information, facility, and fleet services to City programs and departments by charging lease and administrative fees. These fees are incorporated in each department’s budget. Information Services Fund $ 1,501,190 Add and replace network and application technology and hardware. Fees fund computer support services and annual software maintenance contracts. Facilities Maintenance Fund $ 1,112,891 Building maintenance and repairs to include HVAC, janitorial services and minor remodeling. Repairs and scheduled maintenance will be completed in 2006/07. Fleet Management Fund $ 1,334,843 Add / replace 36 vehicles and equipment. The Council continues the four-year replacement cycle for police vehicles and added laptops as standard equipment in the patrol cars. Times Coverage Ratio 0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00 9.00 10.00 2001/02 2002/03 2003/04 2004/05 2005/06 Combined Water Services Electric Minimum Policy Requirement xii CONCLUSION Georgetown is a growing community with ever increasing needs. The 2006/07 Annual Operating Plan allocates resources to address priorities identified by the City Council last Spring and addresses many of those needs. This budget continues the prudent fiscal and budgetary policies implemented in previous years and provides services to the community through new and expanded programs. Each program addressed within the budget has been evaluated to ensure value to the community and enhancement to the quality of life for our citizens. We believe we’ve made an outstanding effort to ensure the goals and objectives set forth by the Council have been met, as well as ensuring that Georgetown remains a safe and affordable place to live and work. The proposed budget balances the needs of the community with available funding to provide quality services to the citizens of Georgetown. This budget also continues the City Council’s commitment to preserving and enhancing Georgetown’s unique character and quality of life. Finally, we acknowledge the tremendous contributions and teamwork of all City staff in preparing the 2006/07 Annual Operating Plan. The management team worked together to assist in achieving the goals set by Council. Each department worked to find savings in their operating budgets, and to make suggestions for program improvements. Most notably, we want to recognize the Finance and Administration Division for their long and dedicated hours in preparing the Annual Operating Plan. Respectfully submitted, Paul E. Brandenburg Micki Rundell, CGFO City Manager Director of Finance & Administration