Council Budget and Finance

Summary

Meeting Overview

The Budget & Finance Committee met on January 29, 2013, at 1:00 p.m., with Ellinger presiding. The committee addressed seven agenda items, including organizational matters, financial reports, and a deferred discussion on the Affordable Housing Trust Fund. Four motions were voted on during the meeting, and the committee heard four public comments. The committee approved the election of a Committee Chair and selection of a Vice Chair, as well as approval of the November 27, 2012 Committee Meeting Summary. Two informational presentations were received: the Monthly Financial Report and the Comprehensive Annual Financial Report and Management Letter. The Affordable Housing Trust Fund discussion led by Henson was deferred to a future meeting.

Attendance

The following individuals were present at the meeting on January 29, 2013:

• Ellinger
• Gorton
• Kay
• Ford
• Beard
• Farmer
• Henson
• EQ Chair
• TBD
• TBD

No absences or late arrivals were recorded.

Votes and Decisions

The meeting included four votes, all of which passed by voice vote.

Election of Budget & Finance Committee Chair 3:30 A motion was made by Stennett and seconded by Beard to elect a Budget & Finance Committee Chair. The motion passed by voice vote.

Appointment of Vice Chair 4:00 A motion was made by Scutchfield and seconded by Massadi to appoint a Vice Chair. The motion passed by voice vote.

Approval of November 27, 2012 Committee Meeting Summary 5:06 A motion was made by Gorton and seconded by Kay to approve the Committee Meeting Summary from November 27, 2012. The motion passed by voice vote.

Motion to Adjourn 1:26:58 A motion to adjourn passed by voice vote.

Public Comment

Four speakers addressed the council during the public comment period, presenting perspectives on affordable housing and homelessness initiatives.

Adam Jones 1:16:04 spoke on behalf of BUILD in support of the Affordable Housing Trust Fund. He urged the council to act before the March 2013 deadline, emphasizing that 27,000 households are affected by the affordable housing crisis and that immediate action is necessary.

David Christensen 1:18:52 argued that the Affordable Housing Trust Fund and the Homeless Commission's proposal should be treated as distinct initiatives. He contended that the Homeless Commission's proposal focuses exclusively on homelessness and urged the council to consider both proposals separately.

Dr. K 1:22:11 provided clarification on the Homeless Commission's report, correcting what he characterized as misinformation. He stated that the Homeless Commission's proposal allocates half of its funds to affordable housing and incorporates most of the Affordable Housing Trust Fund's recommendations.

Council Member Beer 1:23:47 raised concerns about the proposed approach to tax increases. He opposed splitting the proposed tax increase into two parts, arguing that this approach would be politically unwise. He advocated instead for a single, decisive action as a more effective strategy.

Appointments

The following appointments and reappointments were made during the meeting:

• Ellinger was reappointed as Budget & Finance Committee Chair
• Stennett was appointed as Budget & Finance Committee Vice Chair

Contested Items

Affordable Housing Trust Fund vs. Homeless Commission Proposal

Council members were divided on how to treat the Homeless Commission's proposal in relation to the Affordable Housing Trust Fund. The core disagreement centered on whether these should be considered as separate initiatives requiring distinct consideration, or whether they should be evaluated together given their overlapping goals and recommendations. Some members advocated for treating the proposals as independent items for deliberation, while others emphasized the substantial overlap in objectives and urged a unified approach to the two proposals.

Tax Increase Strategy

A heated discussion emerged regarding the implementation timeline for a proposed 0.5% tax increase. Council members debated whether to implement the full increase immediately or to phase it in across two separate periods. The debate reflected concerns about potential public backlash and the political feasibility of the tax increase. Members weighed the benefits of immediate revenue generation against the risks of implementing an unpopular measure all at once.

Election of Committee Chair

3:30

Councilmember Stennett nominated Ellinger for reappointment as committee chair. The nomination was seconded by Beard. The motion passed unanimously by voice vote.

Following the election, Ellinger was asked to appoint a vice chair.

Selection of Vice Chair

4:35

Ellinger was tasked with appointing a vice chair for the body. He requested that Stennett serve in this role. Stennett accepted the appointment.

No formal vote was taken on this selection. The appointment was approved.

11.27.12 Committee Meeting Summary

5:06

The committee considered approval of the summary from the November 27, 2012 meeting. Speakers Gorton and Kay participated in this agenda item.

The committee voted to approve the meeting summary. No substantive discussion occurred beyond the motion and vote to approve the document.

Outcome: Approved

Monthly Financial Report

Bill O'Meara and Melissa Luker presented the December 2012 financial report 5:40.

Revenue Performance

Revenue was slightly ahead of budget, with employee withholdings performing particularly well compared to projections.

Profitability and Expenses

Net profits fell below budget expectations. Expenses exceeded budget by 4.5%, primarily due to personnel costs. However, this overage was attributed to timing factors rather than structural issues.

Outcome

The report was presented for informational purposes. No questions were raised by attendees regarding the financial results.

Comprehensive Annual Financial Report and Management Letter

Simon Keemer and Travis Thomas from Dean Dorton & Allen Ford presented the audit results for the organization's financial statements 20:06.

Audit Opinion

The financial statements received a clean opinion, indicating that the organization's financial reporting met applicable accounting standards.

Internal Control Findings

The audit identified two significant deficiencies in internal controls:

• PeopleSoft Access: A deficiency was noted regarding access controls within the PeopleSoft system
• IT Security: A deficiency was identified in information technology security controls

Despite these findings, no material weaknesses in internal controls were identified during the audit.

Disaster Recovery Planning

The auditors noted that a formal disaster recovery plan was not in place at the time of the audit.

Outcome

The presentation was informational in nature. The clean audit opinion on the financial statements indicates sound financial reporting, while the identified deficiencies in PeopleSoft access and IT security represent areas for management attention and remediation. The absence of a formal disaster recovery plan was also flagged as an item requiring management action.

Affordable Housing Trust Fund — Henson

58:18

Councilmember Ford provided a five-minute historical overview of the Affordable Housing Trust Fund, tracing its development since 2008.

Councilmember Kay updated the committee on the Homeless Commission's report, which largely incorporates the Trust Fund's recommendations but proposes a 1% tax increase and a different allocation structure.

The committee agreed to defer final action on this item until the full Homeless Commission report was presented.

Outcome: Deferred

Items Referred to Committee

1:25:25

Schoninger provided an update on several items that had been referred to committee for further discussion and analysis. The update covered the following matters:

• Procurement Task Force — Status and progress on this initiative were discussed, with plans for continued committee review.

• Solid Waste Cost and Tax Structure — The committee received information on this referred item, which addresses cost considerations and the associated tax structure for solid waste services.

• Local Vendor Preference — This item was reviewed as part of the referred items update, with scheduling for future discussion.

• Financial Efficiency Measures — The committee discussed various measures aimed at improving financial efficiency, scheduled for additional deliberation.

All referred items were scheduled for future committee discussion. The outcome of this agenda item was informational in nature, with Schoninger providing the committee with updates on the status of previously referred matters rather than taking formal action on any of them.