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HomeMy WebLinkAbout2.a. 2006 Budget DiscussionAGENDA ITEM: 2006 Budget Discussion AGENDA SECTION: DISCUSSION PREPARED BY: Jamie Verbrugge, City Administrator AGENDA NO. 7 A ATTACHMENTS: Budget Instructions APPROVED BY: RECOMMENDED ACTION: Give staff direction ACTION: CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION Special City Council Work Session Date: May 31, 2005 BACKGROUND Cite- staff has begun the process of preparing the 2006 City budget. The purpose of the meeting is to share with Council a quick forecast of budget requirements for 2006, to review the Key Financial Strategies, and to discuss Council prerogatives for the coming year. ISSUE As you will see when reviewing the budget instructions from Administration to department heads, the 2006 budget is being prepared m a way that allows Council and staff to identify and pnontize budget items m an "a la carte" fashion. Staff has been directed to begin by identifying 2006 costs for existing service levels. Somewhat akin to zero -based budgeting, the department heads are building 2006 from the budgeted allotments in 2005. However, that does not mean that budgets for each department start at what was given m 2005. The difference is that programmed spending that may have been one -time expenditures in 2005 is not automatically carried over as a cushion to reallocate elsewhere. Departmental budgets will focus on services that are provided on an on -going basis and will reflect necessary increases to maintain those services. There will also be budget increases as a result of decisions made in 2005 or previously. Examples of such increases are an anticipated $350,000 deficit from the State's withholding of Market Value Homestead Credit; the annual installments on assessments for Connemara Phase II related to the acquisition of the Church of St Joseph property; and, implementation costs related to the county -wide High Performance Partnerships imtrauve (H1PP items such as Joint Dispatch). The Key Financial Strategies document will be updated to include the strategic issues identified as priorities by the City Council at its goal setting sessions in April and May A simphfied spreadsheet will be distributed at the meeting (Mr Rapp was in the process of pulling together the final summary at the time the Council agenda was prepared). As we continue the budget process, staff will work to identify any costs related to the pnonuzed work program and will include those in the budget. Council is also encouraged to review the full KFS document and comment on areas that should be reconsidered, revised, or otherwise discussed. The most recent version of the KFS is in the Moody's tour booklet that was distributed to you in early May. If you do not have that document still, please contact me and I will provide a copy of the document to you. Staff will also be preparing budget requests for items that are additions to departmental activities that are either new or enhanced services, new personnel, or new uuuattves This is where the "a la carte" budgeting comes in to play. It is hoped that this process will allow Council to review items and make decisions on their possible inclusion in the budget based on available resources and Council's feelings for an appropriate tax rate. SUMMARY Council is requested to give staff direction as to whether this budget approach is in keeping with the expectations to produce a budget that maintains service levels, focuses on strategic issues, and continues our efforts to provide a competitive tax rate. 2 4 ROSFMOUNT TO: Scott Aker, Fire Chief Andy Brotzler, City Engineer Rick Cook, Operations Superintendent Gary Kalstabakken, Police Chief Kim Lindquist, Community Development Director Jeff May, Finance Director Dan Schultz, Parks Recreation Director Dawn Weitzel, Assistant City Administrator FROM: Jamie Verbrugge, City Administrato DATE: May 10, 2005 RE: 2006 Budget Instructions ADMINISTRATION MEMORANDUM Introduction It is time to begin the annual budget preparation for FY 2006. Below are instructions for compiling operating, capital and personal services figures. As this memo is distributed, it appears the Legislature is very likely to impose some form of limitation on the ability of local government to independently manage its 2006 financial needs. Current proposals suggest that a hard property tax freeze or some other form of levy limits is going to be in place. Given these challenges, matching continued service levels with continued strong growth in the community will require creativity and foresight. The intent is to develop a budget process that establishes a baseline for continuing exisung service levels, as contained in the 2005 budget, and then identifying staffing, services, and initiatives that are desired or necessary m the next and coming years. Operating Budgets Finance Director May will be distributing along with this memo the operating budget worksheets for your respective departments. Please evaluate the non -salary Operating Budget line items to determine what is necessary to maintain your operations at current levels. Do not include new initiatives, service enhancements, equipment and materials, or other items unless they have been specifically 2006 Budget Preparation May 10, 2005 Page 2 of 3 identified as an element of continuing projects or services, or are directly related to the continuation of service delivery. Capital Outlays Attached to this memo is a form (which will also be distributed electronically) that requests detailed explanation for capital items. Please complete this form for every item in the adopted Capital Improvement Plan that is intended to be purchased in 2006. For items that are not in the 2006 CIP (either in out -years or newly identified) that you deem necessary or desirable, please complete the form and specifically identify it as a non -CIP item and explain why it is being proposed for inclusion. Key Financial Strategies Next week I will distribute an itemization of issues for 2006 that are identified in the Key Financial Strategies planning document as being relevant to or the responsibility of your department. Please complete the attached KFS Project Worksheet (which will also be distributed electronically) for 2006 items. Discuss if the respective item is already included in the departmental budget in some manner or if it represents new programming to study or implement. Request for New Staff Additions Attached to this memo are two forms (which will also be distributed electronically) that request detailed explanation for new staff additions one for regular full -time and part-time additions and one for seasonal, temporary and overtime requests. Please explain in the detail if the request for new staff is related to continuing current service levels, to enhancing service levels, or to new initiatives or programming. In order to provide staffing cost projections, please work with Assistant City Administrator Weitzel to identify an appropriate salary range for the proposed position and with Finance Director May to determine total personal service costs including benefits (based on the range) Summary Memorandum Please provide a cover memo with your budget matenals that summarizes the following elements: General Overview of Services please describe the core functions and services supported through your budget. The annual budget book contains descriptions of each department's activities. This section of your memo should be used to either expand upon those descnptions or provide new information. Revenue Enhancements please explain if there are revenue streams beyond those currently used to fund programs and services, and the extent to which those revenues are applicable or reasonable for funding City operations For example, estabhshment of a street hght utility fund would eliminate that expense from the general fund and 2006 Budget Preparation May 10, 2005 Page 3 of 3 levy. Do not include donations that are intermittent to subsidize various community events or departmental programs. Budget and Service Volatility please describe any factors that may influence revenues, expenditures or services in an adverse manner and what options would be available to address such circumstances. For example, if there is pending legislation that could create an unfunded mandate on local governments, describe the issue and impacts. Efficiencies and Operational Change please describe any efforts your department has made in 2005 or proposes to make in 2006 that are intended to deliver services more efficiently or in a manner that deviates to some extent from the manner in which that service is provided now. Please discuss other changes you think are provocative or have the potential for driving efficiencies, and include an explanation of what is necessary to effect this change through the budget or otherwise. New Initiatives please identify any service enhancements or additions that you feel are necessary in 2006 with a detailed rationale supporting the need and an explanation of budgetary or structural adjustments that will be necessary to implement these additions /enhancements Please provide detailed cost breakouts associated with new initiatives that can be added to the operating budgets prior to presentation to the City Council. Future forecast please spend a brief moment looking into the future and forecast issues that will need to be addressed through the budget or service structures, and what options are available in the 2006 budget to prepare for those issues. Final Thoughts Hopefully, this process will provide the greatest flexibility for Administration and the City Council in the decision making process as budget season progresses. Please have your base line item worksheets for the operating budgets to Finance Director May no later than Friday, June 10 Please have the accompanying forms and worksheets submitted to me no later than Friday, une 17. I will be scheduling meetings for Jeff and I to meet with each of you individually to go over your budget materials the weeks of June 20. The first budget discussion will take place at the July 13 City Council Work Session. Budget will also be on the agenda at the regular Work Session on August 10. I anticipate that we may add special work sessions in the fourth week of July and August, prior to adoption of the preliminary levy on Tuesday, September 6. Should you have any questions, please do not hesitate to contact me Quantity Unit Cost Total Cost Trade -In Net Total Cost 2. Give Descnption and Quantity of Item Requested. Indicate Date Desired. CITY OF ROSEMOUNT JUSTIFICATION OF CAPITAL OUTLAYS REQUESTS 1. Department Dept Account No. 2. Give Descnption and Quantity of Item Requested. Indicate Date Desired. 3. Descnbe the necessity for and /or benefits or savings expected from this item. 4. If the item requ an increase in personal services for the activity, state the new job title(s) contingent upon the Item 5. Indicate any expenses necessary to place this item in operation and whether these expenses are included m your budget request. 6 List any item which will be replaced by this purchase. State recommendations for disposition of this item. For example, trade -in, salvage, discard, etc ESTIMATED COSTS CITY OF ROSEMOUNT KEY FINANCIAL STRATEGIES ISSUE /PROJECT WORKSHEET Issue /Project Name: Department Primarily Responsible: Brief Narrative of Issue/Project: (e g descnption of project timeline, level of need) If this issue /project is not pursued, will it affect city service levels? If yes to previous question, when and to what extent? Estimated Cost: What are the funding options for this issue /project? What additional costs will be obligated as a result of this issue /project? (a e if it is a study, what follow up costs would be anticipated? If at is a capital project, what are potential costs for operations and maintenance What other options exist related to this issue/project? Process (e.g amount of staff time; number of meetings with Councils and commissions, community involvement, other stakeholders; estimated schedule) 10 Explain the need for position(s) in detail. 1. Hours per Week 2. Department Cost Allocation 4 Position Title REQUEST FOR REGULAR (FULL -TIME OR PART -TIME) PERSONNEL 5. Number Required 6 Salary Proposed 8. List below the job duties to be performed m the requested position(s). 9. Specify how the above listed job duties are currently performed. 11. Additional costs associated with requested position(s). CITY OF ROSEMOUNT Contractual Services Commodities Capital Outlay 3. Indicate need for position(s) New Operation Expanded Services Increased Work Load 7. 1st Year Cost CITY OF ROSEMOUNT REQUEST FOR TEMPORARY OR SEASONAL PERSONNEL AND /OR OVERTIME 1. Hours per Week 2 Department Cost 3. Indicate Allocation need for position(s) New Operation Expanded Services Increased Work Load r 4. Position Title 5. Number Required 6. Salary Proposed 7. 1st year Cost 8. List below the job duties to be performed in the requested position(s). 9. Specify how the above -fisted job duties are currently performed 10. Explain the need for position(s) in detail. 11. Addition costs associated with requested position(s). Contractual Services Commodities Capital Outlays OVERTIME REQUEST Regular —L Calculation: Amount Temporary or Seasonal Calculation: Amount