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05-03-94 v MINUTES OF THE STRATEGIC PLANNING SESSION OF ATLANTIC BEACH CITY COMMISSION HELD IN CITY HALL AT 4:30 PM ON TUESDAY, MAY 3, 1994 Present: Lyman T. Fletcher, Mayor Suzanne Shaughnessy, Commissioner J. Dezmond Waters, III, Commissioner Robert G. Weiss, Jr. , Commissioner And: Kim D. Leinbach, City Manager James Jarboe, Deputy City Manager Ann Meuse, Finance Director Capt. John Campbell, Police Dept. Maureen King, City Clerk Absent: Steven M. Rosenbloom, Commissioner The meeting was called to order by Mayor Fletcher who indicated that the meeting to clarify the matter relating to the Fire Department pay plan, and to discuss the Ortega law suit, had been canceled since he felt that the budget discussions were of primary importance and should not be cut short for other matters. Jim Jarboe gave an overview of the budget process and noted that Ann Meuse had prepared a list of budget policy issues which should be addressed by the City Commission. Ann Meuse briefly discussed each of the items listed, as follows: A. Capital Improvement Plan: Ms. Meuse expressed concerns about funding the 2010 Comprehensive Plan and indicated this had not been specifically addressed in the past. Kim Leinbach reviewed the Comprehensive Plan and listed those projects which had been completed. It was agreed the Capital Improvements Plan should be revisited annually. B. Privatization: Ms. Meuse felt privatization should be considered in conjunction with the budget. She suggested the city consider contracting out services such as lawn maintenance. Jim Jarboe indicated he was working on a report regarding the cost/benefits of privatizing sanitation service. C. Service Levels: Commissioner Shaughnessy felt that the cost of providing certain services would provide a useful tool to the City Commission in determining the level of service to be provided. Kim Leinbach felt that while purchasing is very closely monitored, he would like to develop a system that would reward department heads for responsible spending. D. Interlocal Agreement: The Mayor reported that mediation had been scheduled for May 25 and June 20. While it is hoped the city will receive additional funding through this action, it was premature to count on receiving funds since any agreement reached in mediation would have to be approved by the Jacksonville City Council. Page Two Minutes of Strategic Planning Session May 3, 1994 E. Risk Management: Ms. Meuse indicated she had included this item since she felt our insurance rates were high. She felt it might be advisable to retain a consultant to review our insurance and, possibly, save the city some money. She felt the city should also look into the possibility of self insurance or a cooperative effort with Neptune Beach or Jacksonville Beach. F. Reserves: Ms. Meuse felt the city should establish a policy regarding the amount of funds to be held in reserve. She indicated that funds had been taken out of reserves to balance negative accounts at the end of the last fiscal year. The City Manager felt that 25% of the operating budget was a responsible amount of funds to hold in reserve. He indicated that the funds in reserve had increased over the last few years. G. Internal Services Fund: Ms. Meuse explained a flow-chart she had prepared to illustrate the separation and function of the different types of funds and reviewed the city' s outstanding debt. (Flow chart attached hereto) . H. Salary Policy: Jim Jarboe indicated it was important for the City Commission to give staff some direction regarding salary policy so that in preparing their departmental budgets the staff would be able to implement the policy and direction of the City Commission. Following further discussion, the Mayor suggested that staff make a list of the questions they want the City Commission to address at the next meeting. Commissioner Weiss asked that salary figures for the current year be compiled along with the actual cost ( including increased cost of contributions to pension, FICA, etc. ) of a cost of living increase. He felt this would be a useful tool to the City Commission when salaries are discussed. He also asked that a sample department budget be drafted for discussion. The Mayor inquired regarding the status of the audit report and it was agreed to invited the auditors to attend the next planning session and to be prepared to present the official audit report at the following commission meeting. Mayor Fletcher felt it was important that all the commissioners attend the next planning session and instructed the City Clerk to make sure that Commissioner Rosenbloom was notified of this meeting. There being no further discussion, the meeting was adjourned at 6:20 PM. Mau een King, gYL5erk CITY OF lireetariee Eeete% - 47eePteda, e. • ••'. 0..d•' • • • C • . City of Atlantic Beach Budget Meeting May 3, 1994 . I BUDGET PLANNING MEETING AGENDA MAY 3, 1994 I. OVERVIEW OF BUDGET PROCESS II. BUDGET FORMAT AND FUNDS OVERVIEW III. BUDGET POLICY ISSUES: A. Funded Capital Improvement Plan 1. Priorities 2. Long term financing B. Privatization 1. Sanitation 2. Fleet Maintenance C. Service levels 1. Existing levels 2. Increased levels 3. Reduced levels 4. Cost D. Interlocal Agreement E. Risk Management 1. Consultant 2. Pool 3. Self-insured F. Reserves 1. Types 2. Level G. Internal Services Fund 1. Finance 2. Fleet Maintenance 3. Insurance 4. Data Processing 5. Public Works Administration 6. Legal 7. Mis. H. Salary Policy I. Prioritizie Councilman Brown's Funding IV. AGENDA FOR NEXT MEETING POSSIBLE PROJECTS RENAISSANCE MONIES CITY OF ATLANTIC BEACH Total Available $165,000 Russell Park Concession Stand 70,000 Complete 16th Street Beach Access 25,000 Donner Park Concession Stand 100,000 12th Street Beach Access Improvement 10,000 Life Guard Building 5,000 Public Safety Building Improvements 150,000 Tresca Property Acquisition 160,000 Life Guard Replacement Vehicle 8,000 Note: The former City Commission approved the transfer of $100,000 from Sanitation fund reserves to finance improvements to the Public Safety Building THE CITY OF ATLANTIC BEACH FLOWCHART OF CITY FUNDS MAY 3,1994 GOVERNMENTAL FUNDS PROPRIETARY FUNDS FIDUCIARY FUNDS I --] GENERAL FUND 1 SPECIAL REVENUE FUNDS DEBT 1 CAPITAL ENTERPRISE INTERNAL TRUST& ISERVICE PROJECTS FUND FUND FUND SERVICE A AGENCY FUND FUND i I —LiI ocal Option G - Convention I Special CAPITAL Gas Tax I Deveopment IAssessments IMPROVEMENT Pension FUND Fla.Mun.Loan ICMA v Restricted for Restricted GilfBreeze f Water I Streets&Roads F.S. 212.0305 I Paving&Drain. Promote Liberty Nat'l ` Police Trust Tourism - I Sewer Pledged for Debt { Convention& G.E.Fleet Service Gulf Breeze Tourist Centers Atlantic Beach Sun Bank Sanitation Experimental I Theater Commission CDBG Section H I Storm Water I City Manager Not Budgeted Finance B.L.E.N.D. Seminole Rd Legal Planning NEAT Ocean Grove Code Enforce. City Clerk PAVE Coquina Rd. City Hall Build. General Gov. Police Fire Public Works Parks&Rec. City of Atlantic Beach Funds Budgeted For 1993/1994 (0.8%)Convention Development (6.8/o)Sanitation F and ° 0.7°/ Misc Ilan ou Gr nts (27.1%)General Fund ( �) s ax�un� #;. £ %?: 2.6 o L tical CI Uon �a ( P %ss >s>; x}: il'•i'iii':�t::�yiiii�``': ::fir:.:.:.,:::::.:.•}}:..�: ................. ( 40 Storm Water Utility zz <::>:s<:::::«::>-::<:>:<::: :::>:<:::>`:«:::.;:,,.;;::<::::r,«.;.:.};:•;::::{:>::::>;;: '� (13.3%)Water Funds (41.7%)Sewer Funds :r ::3C2;.::f.•:'.r{v{%nJ}�}',.vw t:�}:3' \:S.;�.}. 'it.:{]1.5:%•A::}:.�:::TiY i• :..x{Riga•:,:•' ; .;.4t•{\':y: �:',':}iic•','fit''.},{.;�n.{7'E;>3{:::::: >: � (1.7%)Capital Project Fund (3.9%)Debt Service Fund CITY OF ATLANTIC BEACH FUNDS BUDGETED FOR FISCAL YEAR 1993-1994 General Fund 4,900,488 27.14% Convention Development 150,000 0.83% Sanitation Fund 1,236,765 6.85% Miscellaneous Grants 125,000 0.69% Local Option Gas Tax Fund 464,137 2.57% Sewer Funds 7,531,096 41.71% Debt Service Fund 697,388 3.86% Capital Project Fund 301,000 1.67% Water Funds 2,403,982 13.31% Storm Water Utility Fund 247„532 1.37% 18.057.38E General Fund General Fund ,93/94 Budgeted Revenues 93/94 Budgeted Expenditures (29.0%)Police 1 i`vi4:::i:S::.. 7.3% Finance 8 % :Ye`?2 ( 0. i::3.:. 27.3 is ` : "' i :: i`•''•#t .t.. azzz 2.5 Executive ve 6 s%ss > : :. ::::::• : • iiii •; , ::•:..• : 1.3Plan in 9& Zoning •Y'.`f5 iit:> :-srz iii (6.4%)4 General Government 1.6 Le l 9a t-Y .fr,„{lr 4.3 PaksBR r ecreation itis iz:z zzzzzzzzzz::zzzzt.,,-.,-:•.,:•.: s:.::::::.: :............. i; pi;:i:<•::.3ii:i$>i3?<f%1i:i:i:iiiSi' s;.r < .�:::: .... ................................ 1.0 Code Enforcement ...:... . .. ....... . .:.. . •t ( un a TraTransfers .: ... (2.3 )CitY Clerk r. t :;ia: i (21.9 :: . ..... 23.1% . • ii :ix ?:?:`[ :<:>' > (05 Legislative e A . ..:•>r:t::•: .... .. :::: :. >. v ' yr `• {(:: �i.niii.�ri�i%ryrii�::: •::r: (2.9 )EQ Equipmentme nt Maintenancepixs :�rfA :y ii0.3Beautifcation > . i. r�vv f r ..- (18.3%)Fire :� �•r.�.. IPoperty T 0Franchise ®Utility Tax ©Licenses •n..s?v '•'''r (14.5%)Public Works ®State Shar ®Misc.Loc uFund Tran (1.0%)Building 1993-1994 Budgeted 1993-1994 Budgeted General Fund Revenue: General Fund Expenditures: Poperty Taxes 1,335,931 27.3% General Government 312,190 Franchise Fees 527,000 10.8% Planning &Zoning 64,930 Utility Taxes 470,800 9.6% Executive 123,100 Licenses & Permits 165,600 3.4% Finance 357,305 State Shared Reveues 1,070,783 21.9% Police 1,421,211 Misc. Local Revenues 199,344 4.1% Legal 78,740 Fund Transfers 1.131.030 23.1% Parks& Recreation 208,644 $4,990,488 Code Enforcement 47,417 City Clerk 112,650 Legislative 24,792 Fire 897,054 Building 47,173 Public Works 709,160 Beautification 13,585 Equipment Maintenanc 140,653 Interfund Transfers 341.884 THE CITY OF ATLANTIC BEACH DEBT OUTSTANDING MAY 3, 1994 Annual Debt Service Debt Interest Rate Funds Used For Revenues Pledged 1994-1995 General Fund: 1971 General Obligation Bonds 77,000 5.75% Sewer System Improvements Good Faith& Credit of City 39,127 1985 Florida Muncipal Loan 1,015,470 3.79% City Hall, Public Safety, Street Half Cent Sales Tax 188,268 Improvements,Equipment Drainage, Sidewalks Ect. City of Gulf Breeze 1,678,529 7.70% Section H Roads Utility Services Tax 309,706 &Drainage Local Option Gas Tax Liberty National 208,973 5.45% Patrol Cars,Backhoe Lease-Equipment 107,265 Pickup Truck,Mowers Micro film reader,Excavator General Electric Fleet Services 65,058 8.10% Patrol Cars,Fire Truck Lease-Equipment 0 Sun Bank,N.A. 194,715 7.29% Computer,Telephone,Furniture Lease-Equipment 78,353 Total General Fund Debt 3.239.745 222.119 Enterprise Funds Water,Sewer& Sanitation Barnett Bank 10,000,000 5.35% Water& Sewer Improvements Water and Sewer Revenues City of Gulf Breeze 1,116,471 7.70% Section H Water& Sewer Utility Services Tax Local Option Gas Tax Liberty National 128,286 5.45% Garbage Trucks,Excavator Lease-Equipment Total Enterprise Fund Debt 11.244.757 NOTES TO FINANCIAL STATEMENTS CITY OF ATLANTIC BEACH, FLORIDA (Continued) Note 6 - Long-Term Obligations (Continued) Revenue Bonds 1985 Buccaneer District Water and Sewer Serial Bonds, Payable in Annual Installments of Principal and Semiannual Installments of Interest at 9% Through 2000. These Bonds Were Legally Defeased on July 29, 1993 and Will be Prepaid in Full on May 15, 1994. $ 0 State Pollution Control Bonds, Series "Q", Payable in Annual Installments of Approximately $185,000, Including Interest at 8% Through 2000. These Bonds Were Legally Defeased on July 29, 1993 and Will be Prepaid in Full on July 1, 1995. 0 1985 Florida Municipal Loan Council Pooled Loan Program Revenue Bonds, Payable in Quarterly Installments of$40,371 Plus Interest Through 1995 With a Balloon Payment of all Remaining Principal and Interest Due December 1, 1995, Bearing Interest at a Variable Rate (Approximately 3.794% at September 30, 1993). 1,015,470 1989 Oak Harbor Water and Sewer District Revenue Bonds, Payable in Annual Installments of Principal and Semiannual Installments of Interest at 8% Through 2015. These Bonds Were Legally Defeased on July 29, 1993 and Will be Prepaid in Full on March 1, 1994. 0 Total Bonds Payable $ 1,092,470 Notes Payable and Lease Obligations Notes payable at September 30, 1993 are comprised of the following: Barnett Bank of Jacksonville, Up to $10,000,000 Single Draw-Down Note, With Total Principal to be Drawn Down Within 36 Months of Closing; Payable in Quarterly Installments of Interest Only From October 1, 1993 to July 1, 1996; Thereafter Approximately Equal Quarterly Principal Plus Interest Payments Through July 1, 2008. The Note Carries a Fixed Interest Rate of 5.35%, Based on a 360-Day Year. The Note is Secured by a First Lien Upon and Pledge of the Net Revenues of the City's Combined Water and Sewer Systems. $ 3,230,389 22 NOTES TO FINANCIAL STATEMENTS CITY OF ATLANTIC BEACH, FLORIDA (Continued) Note 6 - Long-Term Obligations (Continued) Notes Payable and Lease Obligations (Concluded) City of Gulf Breeze, Florida, Local Government Loan Pool Program, Government Unit Note, Payable in Annual Installments of Principal and Semiannual Installments of Interest at a Floating Rate Increasing From 6.50% to 6.85% Over the Term of the Note. Total Payments are Approximately $225,000 Annually. The Note is Secured By the City's Utility Service Taxes and the Local Option Gas Taxes. $ 785,000 City of Gulf Breeze, Florida, Local Government Loan Pool Program, Government Unit Note, Payable in Annual Installments of Principal and Semiannual Installments of Interest at a Floating Rate Increasing From 7.40% to 7.70% Over the Term of the Note. Total Payments are Approximately $195,000 Annually. The Note is Secured By the City's Utility Service Taxes. 2,010,000 Liberty National Bank and Trust Company, Payable in 33 Monthly Installments of Principal and Interest at a Fixed Rate of Approximately 5.45% Through September 1995. The Note is Secured By Equipment. 337,259 Installment Note, General Electric Fleet Services, Inc., Payable in Monthly Installments of$6,199, Including Interest at 8.1%. 65,058 Capital Lease, Sun Bank, N.A., Payable in Monthly Installments of$6,529, Including Interest at 7.29%. 194,715 Total Notes Payable and Lease Obligations $ 6,622,421 The annual requirements to amortize all debts outstanding (excluding accrued compensated absences) at September 30, 1993 are as follows: General Long-Term Obligations Account Group Enterprise Funds 9/30 Principal Interest Total Principal Interest Total 1994 S 634,599 S 164,487 $ 799,086 S 87,433 S 252,028 S 339,461 1995 587,099 135,620 722,719 90,845 260,422 351.267 1996 440,729 108,308 549,037 27,773 255,549 283,322 1997 398,709 85,641 484,350 224,554 249,263 473,817 1998 185,932 71,208 257,140 238,224 236,350 474,574 Thereafter 992,676 579,289 1,571,965 3,806,318 1,572,056 5,378,374 Total S 3,239,744 S 1,144,553 $ 4,384,297 S 4,475,147 $ 2,825,668 S 7,300,815 23 1 1 NOTES TO FINANCIAL STATEMENTS CITY OF ATLANTIC BEACH, FLORIDA (Continued) Note 6 - Long-Term Obligations (Continued) General Obligation Bonds General obligation bonds (1971 series) of the General Long-Term Obligations Account Group represent bonds issued by the City for construction, improvements and extensions to the City's sewer system. These bonds were issued as general obligations of the City and, therefore, are not obligations of the individual Enterprise (sewer) Fund. Buccaneer District Water and Sewer Serial Bonds During 1995, the City issued revenue bonds to acquire an additional water and sewer system. These bonds were payable from the net revenues of the Buccaneer District Water and Sewer System, and are not general obligations of the City. The bonds contained a provisions which allowed for early prepayment on May 15, 1994, at no penalty. The bonds were legally defeased in connection with the issuance of the note payable to Barnett Bank of Jacksonville on July 29, 1993. Proceeds from the note totalling$1,310,174 plus City debt service reserves of$139,595 were placed in an irrevocable trust account to gross refund all outstanding principal and all interest payments remaining up to the early prepayment date. Cash in escrow of$31,090 plus additional amounts totalling $1,648 will be returned to the City on May 15, 1994, the prepayment date. State Pollution Control Bonds During 1985, the City obtained a State Board Loan which is administered by the State Board of Administration and secured by State Pollution Control Bonds, Series "Q," to support funding for improvement and expansion of its sewer system. These bonds were payable from pledged revenues derived from the operations of the sewer system. The bonds were legally defeased in connection with the issuance of the note payable to Barnett Bank of Jacksonville on July 29, 1993. Proceeds from the note totalling $955,450 plus City debt service reserves of$192,200 were placed in an irrevocable trust account to gross refund all outstanding principal, all prepayment penalties, and all interest payments up to the early prepayment date. As a condition of the defeasance, the City continued to fund a debt service reserve in the amount of$195,804. Additional amounts in escrow totalling $76,278 will be returned to the City on July 1, 1995, the prepayment date. Florida Municipal Loan Council Pooled Loan Program During 1986, the City elected to participate in the Florida Municipal Loan Council Pooled Loan Program (Revenue Bonds, Series 1985). Under this program, the City is eligible to borrow up to $1,871,000 to be used to finance capital projects. At September 30, 1993, $1,015,470 was outstanding and included as an obligation of the General Long-Term Obligations Account Group. The amortization schedule above includes interest on these obligations at an assumed rate of 3.794%. 24 NOTES TO FINANCIAL STATEMENTS CITY OF ATLANTIC BEACH, FLORIDA (Continued) Note 6 - Long-Term Obligations (Concluded) Oak Harbor Water and Sewer District Revenue Bonds During 1989, the City issued additional revenue bonds to acquire the Oak Harbor District Water and Sewer System. These bonds were payable from the net revenues of this system and are not general obligations of the City. The bonds contained a provision which allowed for early prepayment on March 1, 1994, at no penalty. The bonds were legally defeased in connection with the issuance of the note payable to Barnett Bank of Jacksonville on July 29, 1993. Proceeds from the note totalling $898,500 plus City debt service reserves of $18,200 were placed in an irrevocable trust account to gross refund all outstanding principal and all interest payments remaining up to the early prepayment date. Cash in escrow of$14,170 plus additional amounts totalling $1,300 will be returned to the City on March 1, 1994, the prepayment date. Barnett Bank of Jacksonville On June 28, 1993, the City adopted Resolution 93-26, authorizing the issuance of the City's Water and Sewer Revenue Notes, in a principal amount not to exceed $10,000,000, to Barnett Bank of Jacksonville. The proceeds of the note will be used to: (i) finance design, engineering, construction and other eligible costs of certain water and sewer system improvements, (ii) repay certain existing debt of the City consisting of the outstanding principal amounts of the City's Oak Harbor Bonds, Buccaneer Bonds and State Pollution Control Bonds, and (iii) pay costs of issuance and other qualified costs and expenses. The notes were issued in the form of a single draw-down note, which provides for periodic disbursement of funds until the authorized total principal amount of$10,000,000 has been disbursed,not to exceed 36 months. The notes may be prepaid, in whole or in part, without penalty or premium. As of September 30, 1993, $3,230,389 had been drawn down on the notes, which included refunding proceeds of$3,164,125 and issue costs of$66,264. Terms of the Resolution required the establishment of various funds and accounts on the books of the City, including the Gross Revenue Fund, the Debt Service Reserve Fund, the Restricted Reserve Fund and the Improvements Impact Fees Funds. As of September 30, 1993, the City had not established these funds. Other Disclosures During 1991, the City entered into a capital lease to purchase office equipment for $327,484. The minimum lease payments for the remaining lease term are as follows: 1994 - $78,354; 1995 - $78,354; 1996- $58,666. The present value of the minimum lease payments is $194,715. 3 Interest incurred during the in the Enterprise Funds.September All,the 9 interest was charged to expense $188,630 in the Debt Service Fund and$350,5 during the year. 25