Item 8DAGENDA ITEM # 8D
JANUARY 12, 2009
CITY OF ATLANTIC BEACH
CITY COMMISSION MEETING
STAFF REPORT
AGENDA ITEM: Recommended Budget
SUBMITTED BY: Jim
DATE: January 5, 2009
BACKGROUND: The City has recently received amended revenue forecasts from the State
that aze lower than those used to prepaze the budget. Interest rates have
also decreased dramatically because of current economic conditions and
the amounts budgeted by the City for interest earnings this yeaz aze
significantly more than we can expect to receive. These two factors
together decrease expected revenues by $372,000. These aze in addition
to the already decreased revenue estimates for many funds that aze already
included in the current budget.
These same factors aze affecting local governments across the country and
have resulted in many dramatic reductions in personnel and service cuts.
Fortunately, Atlantic Beach is in better fiscal condition than many other
local governments and there are alternatives to reduce the budget without
significant service level reductions to the public. This staff report is to
outline a recommended group of budget modifications that will offset the
expected reductions in state revenues and interest.
Most important is what is not included in this recommendation. No cuts
in personnel, benefits or maintenance projects are recommended. The
biggest single change is in the elimination of the budget for new sidewalk
construction. This is made possible by the Commission's decision not to
move forwazd with the Main Street sidewalk and by eliminating most of
the new sidewalk construction budget for FY 09. There are also several
capital projects both lazge and small that have been bid or otherwise priced
which have, come in under budget. We can also offset the revenue
reductions by a couple of increases in revenues which were not included in
the original budget. These will not require any changes in rates paid by the
public.
There are several recommended reductions in operational accounts in
many of the city's departments. These aze not anticipated to be noticeable
by the public in the short term. For example, training funds in several
departments will be reduced. Training in the long term results in more
AGENDA ITEM # 8D
JANUARY 12, 2009
professional and efficient city employees but, in times of fiscal stress,
some of the city's training can be delayed or eliminated.
The result of these budget amendments, if approved by the City
Commission, will be a loss of flexibility to handle other things that come
up during the year and lower year end budget balances in many of our
funds. Flexibility is often used to move funds from one account that may
be over budgeted to another project that may need additional funds to
complete. Also, smaller projects often come up through the year that can
be accommodated when flexibility exists. Without this flexibility, many
of these projects must be rebudgeted in later years or not done at all.
However, unlike the drastic actions being taken by local and state
governments across the country in response to the current economic crisis,
these recommended actions will not cause undue hardship for staff or
service reductions for the citizens we serve.
BUDGET: The attached spreadsheet entitled "Recommended Budget Amendment
January 2, 2009" includes reductions in revenues totaling $268,500 and
equal reductions and expenditures.
RECOMMENDATION: Authorize staff to prepare a budget amending ordinance for first reading.
ATTACHMENTS: Recommended Budget Amendment January 2, 2009.
AGENDA fl'EM # 8D
JANUARY 12, 2009
Recommended Budget Amendment
January 2, 2009
Revenues
* State Revenue
Estimates
-$150,000 Reductions in sales tax, municipal revenue sharing and bed taxes
received from the State results in reduction of $150,000 in the
General, Gas Tax, Half Cent Sales Tax and Bed Tax Funds.
* Interest Earnings
-$222,000 Interest revenues are declining. This would reduce total interest
budgeted in all funds (except pension) from $330,000 to
$108,000.
* FEMA
Reimbursement
$9,500 Additional reimbursement related to Tropical Storm Fay due to
emergency plan approval.
* Internal Service
Charges
$94,000 Due to error in budget preparation, funds for some internal
service charges were not budgeted
Total Revenues -$268,500
Expenditures
* Capital projects
- New Sidewalks
-$141,000 Eliminates funds budgeted for Main St sidewalk project as welt as
most of FY 09 budget for new sidewalks. Repair budget to remain
funded.
- Bed Tax -$9,000 Reduces undesignated contingency to $231,915.
- Front End loader
for sewer division
-$19,000 Replacement loader purchased under state contract with
significant savings
- AVL project -$12,000 Quotes taken for Automatic Vehicle Locator under budget
- Replace Dutton Isle
gate
-$10,000 Eliminates project for this year. Budgeted at $10,000 but new cost
estimates equal $20,000
- Looking Glass
Software
-$40,000 This is a software project to upgrade the Land Management
System, but is not as urgent given the elimination of other IT
upgrades from the FY09 budget
- Msc. projects -$12,500 Results from 4 other projects in under budget
* Operating Expenses
- Training expenses
-$8,700 Reduction in travel and training accounts from several
departments
- Radio costs
-$7,000 Had budgeted for increase in shared radio costs from COJ, but
increase later reduced; also reduced number of radios to save
money
-Duty phone
-$2,600 Reduces by 1 the number of personnel on-call for after hours
utility emergencies
- PD operations
-$6,700 Eliminates replacement of 2 Tasers this year and reduces PD
accounts for Repair & Maintenance and Supplies by 6%
Total Expenses -$268,500