Council Special Budget and Finance Committee

Summary

Meeting Overview

The Budget & Finance Committee met on October 1, 2013, at 1:00 p.m., with Ellinger presiding. The committee addressed four agenda items during the session, including approval of the August 27, 2013 Committee Summary and review of three informational presentations. The committee took four motions to a vote and heard eleven public comments during the meeting. The informational items presented included a Monthly Financial Report, a Fund Balance Discussion, and Items Referred to Committee.

Attendance

Present: Ellinger, Stinnett, Gorton, Kay, Ford, Beard, Farmer, Scutchfield, Mossotti, Mason, Clark, Lawless, Myers, Akers, Soddy, Schettfield, and Sadi.

Absent: Henson.

Late arrivals: None.

Votes and Decisions

Motion to Reschedule Budget & Finance Committee Meeting 1:30

A motion by Mossotti, seconded by Farmer, to move the Budget & Finance Committee meeting from September 24 to October 1 passed unanimously. All 18 members voted in favor.

Motion to Establish Council Capital Fund 2:00

A motion by Mossotti, seconded by Ford, to recommend establishment of a Council Capital Fund with $250,000 per Councilmember for capital projects passed by roll call vote with 5 ayes and 4 nays.

• Voted for: Henson, Mossotti, Stinnett, Ford, Scutchfield
• Voted against: Beard, Ellinger, Farmer, Gorton

Motion to Allocate Funds to Economic Contingency Fund 1:09:39

A motion by Farmer, seconded by Stinnett, to allocate $2.5 million to the Economic Contingency Fund passed unanimously. All 18 members voted in favor.

Motion to Schedule Special Committee of the Whole Meeting 2:02:06

A motion by Stinnett, seconded by Myers, to hold a Special Committee of the Whole meeting on October 10 at 4:00 PM to discuss ranked project proposals passed unanimously. All 18 members voted in favor.

Budget and Financial Actions

The meeting addressed numerous financial allocations across multiple categories:

Contracts and Professional Services - Affordable Care Act implementation expert: $100,000 - Water franchise negotiator: $100,000 - Old courthouse planning and design: $250,000 - Kitchen floor replacement: $400,000 - Senior center technology upgrades: $200,000 - Bus shelter restoration: $45,000 - Railroad crossing sound barrier: $46,000 - Bike lane striping and signage: $100,000 - Reynolds Road roundabout improvements: $26,000 - Prove Waller Avenue traffic engineering: $100,000 - Southland Drive Commercial Corridor Study: $100,000 - Legacy Trail completion: $1,100,000 - Economic development initiatives: $15,000

Grants - Public art match grant: $100,000 - Sidewalk replacement match grant: $1,000,000

Capital Appropriations and Purchases - Facilities HVAC Projects: $350,000 - Roofing projects: $400,000 - Fleet upgrades: $1,000,000 - Police vehicle replacement: $1,250,000 - Fire vehicle replacement: $1,750,000 - Air tank replacement: $40,000 - Bulletproof vest replacement: $100,000 - Ambulance replacement: $2,000,000 - Pothole patcher technology: $100,000 - Man-O-War redesign: $1,000,000

Reserve Funds and Debt Management - Debt reduction: $4,100,000 - Health insurance reserve: $2,000,000 - Litigation reserve: $5,500,000 - Pension contingency reserve: $2,000,000 - Rainy day fund: $4,000,000

The financial actions encompassed infrastructure improvements, vehicle and equipment replacements, professional services, and strategic reserve allocations totaling significant public investment across multiple departments and initiatives.

Public Comment

Multiple speakers addressed the city's fund balance, its appropriate use, and processes for allocating resources.

Fund Balance and Budget Management

Kay [00:49:26] emphasized that the fund balance represents effective budgeting and efficient government rather than surplus money, and should be used to address unmet community needs like infrastructure and repairs. Stinnett [00:51:34] noted that the fund balance reflects prudent decisions made earlier in the year, including funding health care and addressing streetlights—important public safety actions that were not widely reported. Lawless [00:54:09] stressed that the fund balance is not a windfall but the result of careful budgeting, and warned that delaying infrastructure repairs will cost more in the long run.

Councilmember Priorities and Process

Massadi [00:56:24] defended the need to pursue projects for district needs, comparing it to maintaining a furnace filter, and stated that seeking help for constituents is a core reason for being elected.

Regarding evaluation processes, Gorton [00:57:37] suggested using a ranking system or budget allocation model where each councilmember assigns funds to projects to prioritize them effectively. Kaye [00:59:56] proposed a modified ranking system where councilmembers allocate funds in $100,000 increments across projects to reveal priorities and inform decision-making. Clark [01:02:04] advocated for combining council and administrative requests into a single list to avoid division and ensure fair discussion based on merit.

Debt and Reserve Funds

Henson [01:21:00] and Beard [01:21:00] both expressed concern about the city's debt level and recommended reducing it to 7.5–8% to allow flexibility for future bond issuance.

Stinnett [01:15:22] distinguished between the economic contingency fund, used for revenue smoothing, and a true rainy day fund for one-time emergencies, advocating for a formal, rolling reserve. Farmer [01:14:52] supported the idea of a formal rainy day fund to ensure funds are available for unexpected emergencies without relying on general fund balance.

Contested Items

The October 1, 2013 meeting included two significant areas of disagreement among council members.

Process for Evaluating Capital Project Requests

Council members were divided on how to structure the evaluation of capital project requests. The debate centered on whether requests should be evaluated separately by council and administration or combined into a single unified list. Some members advocated for a unified list approach, arguing this would avoid creating divisions. Others supported maintaining a ranking system to help prioritize projects. The council did not reach unanimous agreement on this procedural matter.

Use of Fund Balance for Council Projects

A heated discussion arose regarding whether the fund balance should be allocated to councilmember-specific projects. Council members expressed differing perspectives on this issue. Some emphasized the importance of accountability in how fund balance resources are used, while others defended the necessity of using these funds to serve their constituents' needs. The disagreement reflected broader concerns about fiscal responsibility versus constituent services.

August 27, 2013 Committee Summary

1:00

The committee reviewed a summary of the previous meeting held on August 27, 2013. Ellinger presented the recap, which covered updates on the monthly financial report and a discussion of the fund balance.

No action was taken on this informational item. The summary was approved by the committee.

Monthly Financial Report

Bill O'Mara presented the monthly financial report for the first two months of fiscal year 2013. 2:00

Financial Performance

The report indicated mixed results against budget projections. Revenue fell $1 million below budget during the two-month period. However, expenses came in $1.4 million below budget, resulting in a net positive variance of $400,000.

Key Economic Indicators

The report highlighted several economic trends affecting the jurisdiction:

• Rising unemployment
• Softening permits
• Strong jail revenue

Speakers and Outcome

Bill O'Mara and Lueker participated in the discussion. The agenda item was presented as informational, with no formal action or decision required from the body.

Fund Balance Discussion

The committee discussed the preliminary fiscal year 2013 fund balance of $51.975 million. 10:14

Proposed Allocations

The discussion included recommendations for allocating the fund balance across several categories:

• $2.5 million to the Economic Contingency Fund
• $5.5 million to litigation reserves
• $2 million to health insurance reserves
• $2 million to pension reserves
• $12.5 million for non-recurring uses
• $2.476 million as unassigned fund balance

Key Participants

The discussion involved committee members O'Mara, Farmer, Stinnett, Kay, Lawless, and Massadi.

Outcome

This agenda item was presented as informational, with no formal action required at this time.

Items Referred to Committee

1:04:25

The committee discussed establishing a formal process for evaluating capital project requests submitted by both council members and the administration.

Key speakers in this discussion included Clark, Gorton, Kaye, and Stinnett.

Discussion Focus

The committee identified a need to create a structured approach for handling capital project requests. Rather than processing requests individually as they arrive, the proposal was to consolidate all requests into a single master list. This centralized approach would allow the committee to review all pending projects together and establish a ranking system for prioritization.

Proposed Plan

The plan involved combining capital project requests from multiple sources—both from individual council members and from the administration—into one comprehensive list. Once consolidated, these projects would be ranked to facilitate more organized and strategic discussion about which projects should move forward and in what order.

Outcome

This agenda item was informational in nature, with no formal vote or binding decision recorded. The discussion resulted in a proposal for how to manage future capital project requests through a more systematic process.