Budget & Finance Committee

Summary

Meeting Overview

The Budget & Finance Committee of the Whole met on October 21, 2014, at 1:00 p.m., with Gorton presiding. The committee addressed five agenda items during the session, taking six votes and hearing three public comments. The meeting resulted in approval of the September 23 Committee Summary, the Fund Balance Discussion, and the 2015 Bond Adjustment for QECD. A Monthly Financial Report was presented for informational purposes, while Items Referred to Committee were deferred to a future date.

Attendance

The following individuals were present at the meeting on October 21, 2014:

• Gorton
• Ellinger
• Kay
• Ford
• Akers
• Lawless
• Beard
• Farmer
• Stinnett
• Scutchfield
• Myers
• Mossotti
• Clarke
• Henson
• Lane

No absences or late arrivals were recorded.

Votes and Decisions

The committee took six votes during this meeting, all of which passed.

Corrected September 23 Minutes 5:03 A motion by Clark, seconded by Browlinger, to approve corrected minutes from the September 23 Committee Summary passed by voice vote.

Preliminary Fund Balance Categories 48:19 A motion by Farmer, seconded by Farmer, to approve preliminary fund balance categories as outlined on page 22 passed unanimously.

General Obligation Bond for Fire Station 1:05:39 A motion by Massadi, seconded by Stinnett, to add $1.5 million to the general obligation bond for the fire station to reach $4 million passed unanimously.

Qualified Energy Conservation Bond 1:07:14 A motion by Farmer, seconded by Beard, to approve issuance of $2.9 million Qualified Energy Conservation Bond for detention center energy improvements passed unanimously.

Special Budget Committee Meeting 1:15:20 A motion by Farmer, seconded by Stinnett, to schedule a special budget committee meeting on November 13, 2014, at 3:00 PM passed unanimously.

Economic Development Partner Agency Performance Measurement 1:18:04 A motion by Scutchfield, seconded by Gorton, to remove the Economic Development Partner Agency Performance Measurement item from the Committee referral list passed by voice vote.

Budget and Financial Actions

The meeting addressed two significant financial actions:

Fire Station Expansion Bond Amendment

An amendment to the 2015 bond project was approved for fire station expansion, allocating $1,500,000 for this purpose.

Detention Center Energy Efficiency Improvements

The body approved issuance of a Qualified Energy Conservation Bond in the amount of $2,900,000 to fund energy efficiency improvements at the detention center. Siemens was identified as the vendor or recipient associated with this bond issuance.

Public Comment

Three speakers addressed the council during the public comment period.

Lyric Theater Audit Correction

Clark provided a correction to the meeting minutes regarding the Internal Audit Board's authorization of an audit of the Lyric Theater 3:54. Clark clarified that the board could revisit the audit after the public accountants complete their work, addressing a point of clarification about Bruce Salley's earlier statement.

Fire Station Bond Increase

Henson spoke in support of the motion to increase the fire station bond to $4 million 58:38. Henson emphasized the need for future planning in light of new residential development occurring nearby and stressed the importance of ensuring adequate staffing levels to serve the growing area.

Fund Balance Allocation

Farmer addressed the council regarding fund balance allocation 1:11:00. Farmer emphasized the importance of maintaining a $2.2 million unassigned fund balance to address unforeseen needs and encouraged the council to avoid dedicating all available funds to specific projects.

Contested Items

Fund Balance Allocation and Unassigned Balance

Council members divided on how to allocate the city's non-recurring fund balance during the October 21, 2014 meeting. The central disagreement concerned whether to assign the full $2.2 million in available non-recurring fund balance or to retain a larger reserve for unforeseen needs.

Those advocating for assigning the full amount prioritized targeted spending on identified priorities and projects. In contrast, council members supporting a larger cushion emphasized the importance of maintaining financial flexibility to address unexpected expenses or emergencies that might arise.

The debate reflected differing philosophies about fiscal management—balancing the desire to deploy available resources against the prudent practice of maintaining adequate reserves. The result was a split vote, indicating the council could not reach consensus on the appropriate allocation strategy.

September 23 Committee Summary

The committee reviewed and approved the corrected minutes from the September 23 meeting 3:23. Council Member Clark provided a correction to the Lyric Theater audit statement that had been included in the original minutes. The committee approved the minutes with this correction incorporated.

Monthly Financial Report

The committee reviewed the August monthly financial report, with presentations from O'Mara, Cook, and McGee. 5:42

Financial Performance

The August report demonstrated strong overall financial performance:

• Revenue exceeded budget by $1.5 million
• Expenses came in $4.8 million under budget
• Combined positive variance of $6.3 million through August

Notable Areas of Strength

The report highlighted particularly strong performance in two key areas:

• Franchise fees
• Net profits

Outcome

This agenda item was presented for informational purposes, with no action items or decisions required from the committee.

Fund Balance Discussion

The committee reviewed the preliminary fund balance, which showed a $9.3 million year-over-year increase. 16:33

O'Mara presented the fund balance discussion, covering several key categories:

• Economic contingency
• 27th payroll
• Energy improvement
• Litigation reserve

The presentation included recommendations for fund balance reporting and allocation across these categories.

The committee approved the fund balance discussion and its recommendations.

2015 Bond Adjustment for QECD

50:03

The committee discussed a proposal to issue a $2.9 million Qualified Energy Conservation Bond (QECD) for energy improvements at the detention center. This bond would be issued in conjunction with an existing $26.1 million general obligation bond.

Key speakers in this discussion included O'Mara, Farmer, and Beard.

The committee considered the energy conservation bond as a financing mechanism for facility improvements at the detention center. The proposal involved coordinating the $2.9 million QECD issuance with the broader $26.1 million general obligation bond package.

The motion to approve the 2015 Bond Adjustment for QECD passed unanimously.

Items Referred to Committee

1:16:30

The committee addressed several items that had been referred for further consideration. During this discussion, the committee took action on multiple referrals based on administrative readiness and scheduling considerations.

The committee voted to remove the Economic Development Partner Agency Performance Measurement item from the referral list. This action concluded the referral process for that particular item.

The Wellness Center lease was deferred to the November meeting, allowing additional time for preparation and review before the committee would take it up again.

Other items under referral were also deferred to future meetings, with the timing determined by the administrative readiness of each item. This approach ensured that the committee would address each referral when sufficient preparation and supporting materials were available.

Key participants in this discussion included Ellinger, Farmer, Stinnett, and Lane. The overall outcome of the agenda item was a deferral of most items, with specific scheduling determined by administrative needs and the status of each referral.