08-21-2008 VC B WS-M• MINUTES OF THE BUDGET WORKSHOP SESSION
VILLAGE COUNCIL OF NORTH PALM BEACH, FLORIDA
AUGUST 21, 2008
Present: William Manuel, Mayor
David B. Norris, Vice Mayor
Darryl Aubrey, President Pro Tem
Edwazd M. Eissey, Councilman
T.R. Hernacki, Councilman
Jimmy Knight, Village Manager
Melissa Teal, CMC, Village Clerk
ROLL CALL
Mayor Manue] called the Budget Workshop Session to order at 7:00 p.m All members of Council
were present. All members of staff were present, except the Village Attorney. Finance Director
Sarnia Janjua, Community Development Director Chuck Huffy Human Resources Director Mary
Kay McGann, Library Director Donna Riegel, Pazks and Recreation Director Mark Hodgkins,
Interim Public Safety Director George Warren, Public Works Director Wiley Livingston, and
Information Technology Manager Michael Applegate were present.
. FY 2009 BUDGET RECAP
Mr. Knight reminded those present of the following:
• Only 31 ¢ of each tax dollaz goes to the Village
• Personnel costs comprise 68% of the budget
• Public Safety and Public Works account for 36% and 26%, respectively, of the budget
• Ad Valorem taxes generate 61.8% of General Fund revenues
• Projected General Fund revenues for FY 2009 total $19,133,755
• Total assessed taxable value has decreased to $1,960,565,457, aloss of $56,749,896
• Amendment 1 has further decreased assessed property values by $112,720,252
Mr. Knight noted that the combined loss in taxable value at the current millage rate of 6.1 is
equal to a $1,033,768 loss in ad valorem revenue. Further, Mr. Knight reported a decline in
revenues received from franchise fees, utility services tax, sales and use taxes, license and permit
fees, fines and forfeitures, and investment income. Mr. Knight advised that the combined
revenue from franchise fees, sales and use taxes, license and permit fees, utility services tax,
intergovernmental revenue, fines and forfeitures, and changes for services is projected at
$7,061,695 for FY 2009 - a reduction of $345,967 from the current yeaz.
Mr. Knight reported an 8.3% increase in health insurance, and noted that this would have been
more, but prescription benefit changes were implemented and the dental insurance policy was
• changed to United Healthcare, in order to lessen the amount of increase.
Minutes of Village Council Budget Workshop Session held August 21, 2008 Page 2 of 3
• Mr. Knight advised that full-time positions in the General Fund budget were decreased by 21.
Full-time positions in the Country Club budget decreased by 13, as a result of outsourcing golf
course maintenance in October, 2007.
Mr. Knight explained that due to the current volatility of fuel costs, gasoline was budgeted at
$5.00 per gallon - a significant impact to operating costs.
Mr. Knight reviewed the capital plan, and noted that the costliest capital items aze street overlay,
ambulance purchase, and pool resurfacing.
Mr. Knight discussed debt service, and noted that $898,172 has been budgeted for loan repayments
in FY 2009. Mr. Knight advised that three out of five loans aze variable.
Mr. Knight reviewed changes to the contingency amount in the General Fund Budget resulting
from Council Budget Workshop discussions and recent adjustments to certain revenue and
expense items. Mr. Knight reported a $44,026 decrease in estimated revenue due from the Local
Government 1/2¢ sales tax. Mr. Knight noted changes in expenses for park maintenance, tennis
court maintenance, and sanitation. Mr. Knight reported that the new IT Tech Support position
was changed from full-time to part-time. Mr. Knight advised that the new full-time custodian
position was deleted; however, a cleaning service for the parks was added. Mr. Knight explained
that FPL has projected an 8% increase in the cost for electricity, rather than 5% as originally
budgeted. Mr. Knight noted a reduction in the cost of health and dental insurance, which
• initially came in at 19%, but was reduced to 8.3% through negotiation. Mr. Knight reported
$630,243 in contingency funds for FY 2008-2009.
Mr. Knight compazed projected revenue from ad valorem taxes for FY 2009 ($11,818,060) to the
original FY 2008 budget ($11,757,545) and noted a total increase in ad valorem taxes of$60,515
at the proposed millage rate of 6.7322. Mr. Knight advised that total expenditures aze down
$558,193 over FY 2008. Mr. Knight expressed concern about the impact lowering the millage
rate will have on succeeding budget years. Mr. Knight discussed three options regarding the
millage rate, and recommended that Council consider keeping the millage rate at the current
yeaz's rolled-back rate of 6.7322 and redirect budgeted savings to satisfying four loans having a
payoff amount of$1,156,808. Mr. Knight explained that by combining $468,172 in debt service
payments with $410,243 in contingency funds and $478,393 from the undesignated unreserved
fund balance, the Village would be able to retire all but one loan in the General Fund.
Mr. Knight noted the four loans include one that is split between the General Fund budget and
Country Club budget, which would require expending approximately $22,000 of the $212,000
balance in Country Club contingency in order to pay offthe Country Club's portion ofthat loan.
Discussion ensued on the balance remaining in the State Business Administration (SBA) Local
Government Investment Pool (LGIP) Fund "B", as well as any projected surplus from the current
yeaz's budget. Mrs. Janjua reported the Fund "B" balance is just under $600,000. Mr. Knight
estimated the FY 2008 budget surplus could be a maximum of$200,000.
• Mr. Knight requested an increase in Manager's contingency from $10,000 to $20,000.
Minutes of Village Council Budget Workshop Session held August 21, 2008 Page 3 of 3
• Council discussed reducing the millage rate. Mr. Knight advised that if the millage rate is
reduced to 6.6977 and Council opts to pay off four loans, it leaves a balance of $159,437 in
contingency funds. Mr. Knight noted that a millage rate of 6.6977 results in lower taxes, a
reduced budget, and a substantial reduction in debt service.
CONSENSUS ITEMS
• Reduce the millage rate to 6.6977
• Approve "option 3" and pay off four loans
• Increase Village Manager contingency to $20,000
Mr. Knight advised that employees affected by workforce reductions will receive letters and
personal contact tomorrow.
ADJOURNMENT
With no further business to come before the Council, the meeting adjourned at 8:25 p.m.
Melissa Teal, CMC, Village Clerk
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