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08-03-2016 VC BWS-MMINUTES OF THE BUDGET WORKSHOP SESSION VILLAGE COUNCIL OF NORTH PALM BEACH, FLORIDA AUGUST 3, 2016 Present: David B. Norris, Mayor Doug Bush, Vice Mayor Darryl C. Aubrey, Sc.D., President Pro Tem Robert A. Gebbia, Councilmember Mark Mullinix, Councilmember James P. Kelly, Village Manager Melissa Teal, Village Clerk ROLL CALL Mayor Norris called the meeting to order at 7:00 p.m. All members of Council were present. All members of staff were present, except the Village Attorney. Also present were Finance Director Samia Janjua, Library Director Zak Sherman, Parks and Recreation Director Mark Hodgkins, Golf Director Casey Mitchell, Food and Beverage Director Chuck Huff, Information Technology Director Michael Applegate, and Human Resources Director Britoni Garson. PURPOSE OF THE MEETING Mr. Kelly explained the Fiscal Year 2017 budget items for review and discussion included: • FY 17 Summary of Budget Changes to Country Club and General Fund • Library Budget • Parks & Recreation Budget • Country Club Budget FY17 SUMMARY OF BUDGET CHANGES — COUNTRY CLUB AND GENERAL FUND Mr. Kelly stated the budget changes for both the Country Club and General Fund since the last discussion had to do with updated personnel costs due to savings in the insurance contract. Mr. Kelly reviewed the changes, as follows: • Country Club o Updated Personnel Costs - $5,685 ■ Health Insurance o Ending Contingency - $10,762 • General Fund o Updated Personnel Costs - $116,896 ■ Health Insurance ■ Director of Library Salary and Benefits o Ending Contingency - $116,896 Minutes of Village Council Budget Workshop Session held August 3, 2016 Page 2 of 6 LIBRARY Mr. Kelly reviewed the organizational chart for the library, noting there were no changes proposed to the department, which includes seven (7) full-time and nine (9) part-time employees. Mr. Kelly introduced the new Library Director, Zak Sherman. Mr. Kelly reviewed the FY17 projected revenues for the library, including memberships, State Aid, copying, lost books, library fines, gift account interest, donations, and miscellaneous revenue. Mr. Kelly stated the projected revenues totaled $29,112 for the year. FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Personnel $659,824 $641,182 2.91% $18,642 Operating $161,194 $163,957 -1.69% ($2,763) Total Expenses $821,018 $805,139 1.97% $15,879 PARKS & RECREATION Mr. Kelly reviewed the organizational chart for Parks & Recreation and noted there were no changes proposed. Mr. Kelly stated there were six (6) full-time employees in the department along with 43 part-time employees, including lifeguards, recreation assistants, and camp counselors. Parks & Recreation Combined Summary Councilmember Mullinix asked for further explanation of the revenue share on the pool for lessons. Discussion ensued regarding swimming lessons and other pool activities. Mr. Kelly reviewed the projected Recreation and Special Events revenues and expenses. Recreation & Snecial Events Expenses Recreation Tennis Pool Total Total Revenues $484,300 $473,100 $80,500 $1,037,900 Operating $502,825 $464,723 8.2% $38,102 Personnel $636,216 $155,069 $94,715 $88600 Operating $502,825 $294,354 $103,255 $900,434 Total Expenses $1,139,041 $449,423 $197,970 $1,786,434 Revenues over (under) expenses ($654,741) $23,677 ($117,470) ($748,534) Councilmember Mullinix asked for further explanation of the revenue share on the pool for lessons. Discussion ensued regarding swimming lessons and other pool activities. Mr. Kelly reviewed the projected Recreation and Special Events revenues and expenses. Recreation & Snecial Events Expenses Councilmember Gebbia asked for further clarification on Anchorage Park. FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Personnel $636,216 $628,142 1.29% $8,074 Operating $502,825 $464,723 8.2% $38,102 Total Expenses $1,139,041 $19092,865 4.23% $46,176 Councilmember Gebbia asked for further clarification on Anchorage Park. Minutes of Village Council Budget Workshop Session held August 3, 2016 Page 3 of 6 Discussion ensued regarding revenue being down because of lack of spaces available for larger boats, the impact of the seawall repair on revenue, reduction in facility rentals, the waiting list for larger spaces, and standardizing materials used from park to park. Discussion continued regarding Recreation program expenses., Mr. Kelly explained the line item was for instructors in each area. Council requested a profit and loss on each program category. Tennis Expenses FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Personnel $15509 $139,012 11.55% $16,057 Operating $294,354 $214,425 37.28% $79,929 Total Expenses $449,423 $353,437 27.16% $95,986 Mr. Kelly reviewed the projected Tennis revenues and expenses. Discussion ensued regarding salary and benefits, reviewing the current year to date expenses compared with the budget. Consensus was to request staff review the FYI salaries and benefits further. Pnnl r1.YnPiICPC FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Personnel $94,715 $99,029 -4.36% ($4,314) Operating $103,255 $9209 11.40% $10,566 Total Expenses $197,970 $191,718 3.26% $6,252 Mr. Kelly reviewed the projected Pool revenues and expenses. Discussion continued regarding the trend in operating costs, pool temperature, flow, and chlorine. Councilmember Mullinix asked for clarification on the arrangement with the swim coach. Parks and Recreation Director Hodgkins explained the change from receiving revenue for lessons to receiving a monthly flat lease amount. Discussion ensued on pool rentals. Council and staff discussed how to account for the planned pool closure. Finance Director Janjua explained the adjustments made to budgeted salaries. COUNTRY CLUB Finance Director Janjua explained a proposed change in the Member Relations Coordinator, moving from part-time to full-time. Mr. Kelly reviewed the organizational chart for the Country Club, pointing out changes. Mr. Kelly stated adjustments had been made because of positions which were carried forward and never filled. He explained with the reclassifications, the overall full-time staff would remain steady at eight (8), and the part-time staff would move from 65 to 62. Minutes of Village Council Budget Workshop Session held August 3, 2016 Page 4 of 6 Discussion continued regarding Food and Beverage staffing and flexibility of the changes. Country Club Combined Summary Mr. Kelly noted the number of golf rounds projected was 44,050, down from 44,200 in FY16. Golf Director Casey Mitchell discussed the projected golf revenues for FY17, including a breakdown of membership revenues. Ms. Mitchell discussed the potential for slow down and recommended no increase in fees for FYI Council and staff discussed considering a comparison study of membership costs. Ms. Mitchell stated she thought rates were competitive and suggested waiting. Council agreed by consensus to leave membership fees as presented. Golf Director Mitchell continued to review revenues, discussing cart rentals and walking fees. Discussion ensued regarding the upward trend in walkers. Golf Expenses FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Total Revenues $3,797,455 $4,128,676 -8.02% ($331,221) Operating $1,744,024 $1,782,700 -2.17% ($389676) Personnel $1,155,130 $1,209,119 -4.47% ($53,989) Operating $398,151 $510,151 -21.95% ($112,000) Capital Outlay $7,000 $20,000 -65% ($13,000) Debt Service $398,151 $510,151 -21.95% ($112,000) Contingency $10,762 $115,350 -90.67% ($104,588) Total Expenses $3,797,455 $4,128,676 -8.02% ($331,221) Mr. Kelly noted the number of golf rounds projected was 44,050, down from 44,200 in FY16. Golf Director Casey Mitchell discussed the projected golf revenues for FY17, including a breakdown of membership revenues. Ms. Mitchell discussed the potential for slow down and recommended no increase in fees for FYI Council and staff discussed considering a comparison study of membership costs. Ms. Mitchell stated she thought rates were competitive and suggested waiting. Council agreed by consensus to leave membership fees as presented. Golf Director Mitchell continued to review revenues, discussing cart rentals and walking fees. Discussion ensued regarding the upward trend in walkers. Golf Expenses Councilmember Mullinix noted the Capital lease ending was virtually all of the change. Mayor Norris asked when the golf maintenance contract was up. Mr. Kelly explained the contract would be up in FYI 8. Discussion ensued regarding contractual services and salaries. Golf Director Mitchell shared efforts to decrease expenses by becoming creative with scheduling. FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Personnel $649,333 $618,928 4.91% $30,405 Operating $1,744,024 $1,782,700 -2.17% ($389676) Capital Outlay $7,000 $20,000 -65% ($13,000) $398,151 $510,151 -21.95% ($112,000) Total Expenses $2,798,508 $2,931,779 1 -4.55% ($1335271) Councilmember Mullinix noted the Capital lease ending was virtually all of the change. Mayor Norris asked when the golf maintenance contract was up. Mr. Kelly explained the contract would be up in FYI 8. Discussion ensued regarding contractual services and salaries. Golf Director Mitchell shared efforts to decrease expenses by becoming creative with scheduling. Minutes of Village Council Budget Workshop Session held August 3, 2016 Page 5 of 6 Vice Mayor Bush asserted the increase in salaries and expenses needed to be reflected in an increase in membership costs and fees. Discussion ensued regarding what was realistic and what would cause a loss in membership. Fnnd and Beverage Expenses FY 2017 Budget FY 2016 Budget % increase/ decrease $ increase/ decrease Personnel $440,366 $525,399 -16.18% ($85,033) Operating $389,017 $400,288 -2.82% ($11,271) Total Expenses $829,383 $925,687 -10.40% ($969304) Food and Beverage Director Chuck Huff discussed Food and Beverage revenues. Mr. Huff reviewed a comparison of annual revenues from 2014 forward. Council and staff discussed year- to-date revenue and beer and liquor prices compared to prices. Food and Beverage Director Huff reviewed options for operation in the Clubhouse between the beginning of FY 17 through March. Mr. Huff discussed expenses and staffing considerations with each option and asked for feedback from Council. Councilmembers asked questions about how the bar would be impacted with each option and existing precedent from other projects. Vice Mayor Bush stated he favored continuing to operate and utilize the construction period as the transition period on how food and beverage would operate in the future. Discussion continued on messaging to employees regarding the closure. Mayor Norris suggested a Request for Proposals (RFP) or Request for Quotes (RFQ) to determine if there were any entities interested in operating the snack bar month-to-month but stated they should budget as though operations would continue as normal. Discussion ensued on the timeline for the Country Club project and projected losses. Finance Director Janjua explained the year-to-date loss for the restaurant was $219,000 and revenue over expense for Golf was $754,000, prior to debt service. Resident Magill Sanderson provided public comment, stating that bringing in a new restaurant could be a dangerous option because not many restaurants make money initially. Vice Mayor Bush agreed, asserting new restaurants typically budget to lose money for the first three (3) years, so a six (6) month operating period would probably not make sense. In response to questions, Mr. Kelly reviewed budgeting and funding sources for the Country Club project. Mr. Kelly discussed changes staff had made to balance the budget and the positions which would be needed if the restaurant continued to operate. Discussion continued regarding the overall budget. Consensus was to budget for 12 months of Food and Beverage and to continue operating the restaurant. Minutes of Village Council Budget Workshop Session held August 3, 2016 Page 6 of 6 Country Club Administration Expenses Mr. Kelly discussed Country Club administration revenues briefly, explaining they were budgeted at $16,000 in interest and charge card fees. Councilmember Mullinix asked if there were golf projects scheduled for FYI 7. Golf Director Mitchell stated there were no projects budgeted. Discussion ensued regarding the need to continue doing projects each year to keep up with needs, debt service, the process for budgeting golf project expenses, and the Master Plan. BUDGET WORKSHOP SCHEDULE Mr. Kelly reviewed the schedule of remaining budget hearings, including: • Wednesday, August 10 — General Fund Department Budgets • Tuesday, August 16 — Country Club • Wednesday, August 17 — Public Works Budget • Tuesday, August 23 — Police, Fire Rescue, and Community Development Budgets • Wednesday, August 31 — Budget Recap and Millage Discussion Mr. Kelly stated he had been approached about purchasing an adjacent property and asked for direction from Council regarding how to proceed. Upon discussion, consensus was to have staff gather additional information. ADJOURNMENT There being no further business to come before the Council, the meeting adjourned at 9:04 p.m. Co `gyp eted by Jessica Green, MMC, Village Clerk L) FY 2017 Budget FY 2016 Budget % increase/. decrease $ increase/ decrease Personnel $65,431 $64,792 0.99% $639 Operating $38,887 $39,179 -0.75% ($292) Debt & Other $65,246 $167,239 -60.99% ($101,993) Total Expenses $169,564 $271,210 -37.48% ($101,646) Mr. Kelly discussed Country Club administration revenues briefly, explaining they were budgeted at $16,000 in interest and charge card fees. Councilmember Mullinix asked if there were golf projects scheduled for FYI 7. Golf Director Mitchell stated there were no projects budgeted. Discussion ensued regarding the need to continue doing projects each year to keep up with needs, debt service, the process for budgeting golf project expenses, and the Master Plan. BUDGET WORKSHOP SCHEDULE Mr. Kelly reviewed the schedule of remaining budget hearings, including: • Wednesday, August 10 — General Fund Department Budgets • Tuesday, August 16 — Country Club • Wednesday, August 17 — Public Works Budget • Tuesday, August 23 — Police, Fire Rescue, and Community Development Budgets • Wednesday, August 31 — Budget Recap and Millage Discussion Mr. Kelly stated he had been approached about purchasing an adjacent property and asked for direction from Council regarding how to proceed. Upon discussion, consensus was to have staff gather additional information. ADJOURNMENT There being no further business to come before the Council, the meeting adjourned at 9:04 p.m. Co `gyp eted by Jessica Green, MMC, Village Clerk L)