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HomeMy WebLinkAboutMinutes 09-18-2009 CITIZENS’ BUDGET COMMITTEE Meeting Date: September 18, 2009 Conference Room 3 Meeting convened at 7:34 a.m. MEMBERS PRESENT: Carl Hensley, Chair Dan Kurek Randy Ezell Craig Mundt Nathaniel “Nate” Wells Patricia “Pat” Ferrick Edith Hepburn John Culverhouse Edward Lounds Richard Pancoast Jay L. McBee MEMBERS ABSENT: Bobby Rodriguez Thomas Hickey Bill Casey Dana McSweeney OTHERS PRESENT: Faye Outlaw Lee Ann Lowery Marie Gouin Jennifer Hill Carl Holeva Sophia Holt John Ferrick Laurie Waldie Lisa Savage Mark Godwin Leo Cordeiro Roger Shinn Debbie Brisson Bill Hoeffner Susan Kilmer Diana Lewis Bill Martin Jim David Mark Satterlee Mike Powley Robert O’Sullivan Toby Long Erick Gill Katherine Hensley Anita Neal Paul Hiott CALL TO ORDER Mr. Hensley called the meeting to order at 7:34 a.m. APPROVAL OF MINUTES st Mr. Mundt made a motion to accept the August 21 minutes. Mr. Pancoast seconded the motion and it passed unanimously. Citizens’ Budget Committee September 18, 2009 Page 2 COST CONTAINMENT MEASURES, COST REDUCTION MEASURES & REVENUE ENHANCEMENTS – Ideas from members The grid (see attached) was handed out to the members. Ms. Outlaw gave them time to review it. The questions had been sent to the members. The grid was grouped by departments so the directors could focus on their operation. Mr. Hensley noticed that a lot of the suggestions were already being done. Ms. Outlaw added that some of them had been researched but were not implemented for some reason. th There are some that she will look at after the Budget Workshop, September 29, before Strategic Planning in November. Mr. Lounds asked for the employee count. Ms. Outlaw answered that there are 754 positions on the books and 745 live bodies. Two years ago there were over 900. Mr. Lounds asked about lost services. Ms. Outlaw said they have tried to maintain services but there have been changes in hours of operations in some departments such as the libraries. The number of guarded beaches has been reduced. She believes there is an acceptable level of service. We are in a position where although residents voted for Amendment 1 by over 70%, they did not recognize that it would translate into delaying the ability to respond. She does not think some of the expectations are reasonable. Mr. Lounds agreed. The folks he has talked to feel they are getting a fair shake. There are always exceptions. He feels unfunded mandates from the State are out of control. Not all the money that is spent is ours to spend. He thinks Administration and staff has done an excellent job. It has been tough but it is working. He doesn’t know where to go from here. Mr. Hensley agreed that a good job had been done of cutting back. He thinks part of the focus should be on revenue enhancements. Fees may have to be increased if folks are unhappy with their service. Mr. Lounds tried to get dialogue started. He asked if more cutbacks, such as furloughing employees, are possible. He thinks if the number of employees is reduced anymore there will have to be a cut in services or the positive effect of the current employees will diminish. He would look for another job if he were told he would be furloughed. He would rather find other ways than cutting pay or hours. Mr. Mundt asked the amount of the gap. Ms. Outlaw said that is being determined. FY 2010 is balanced. They are looking at 2010-2011. A major portion of funding is one-time money from the year before. They are beginning to experience less available because so much has been stripped from the budget there is less opportunity for departments to save. They will probably be down $8,000,000 to $10,000,000 if the property values decrease st 14% as predicted by Mr. Furst. He won’t know until June 1. A budget workshop has been Citizens’ Budget Committee September 18, 2009 Page 3 th scheduled for September 29 to talk about different scenarios. The direction given at the workshop will determine the structure of the November Strategic Planning Session. The finance plan from Strategic Planning will be used for the next year’s budget planning that begins in early February. Mr. Mundt asked if Ms. Outlaw thinks she can find $14,000,000 in revenue enhancements. She answered that she is certain she cannot. They are still experiencing and anticipating a drop in property values, which is a large source of the County’s revenue. The building permit and development activity have dropped. The Board has approved some incremental increases. The rental of County facilities was increased but it was a financial hardship for non-profits to pay so they asked the Board to waive the fee. The Board is trying to balance. They are looking at increases in impact fees. The final recommendation has been made by the consultant. Around the State, impacts fees are being put on hold. It will be brought before the Board. She believes they will wrestle with the decision. They do believe in making development pay for itself. They are trying to balance. If we can’t make it in revenue, there are constant reminders of people on fixed incomes, and we don’t want to talk about reducing personnel or operations, Mr. Mundt asked what the alternatives are. Ms. Outlaw responded that there are no good alternatives. Historically, the County has kept itself afloat by bearing the burden of the cutbacks in County operations. It will be the Board’s decision to set the policy. It they cut the funding, there will have to be cuts in services. The organization cannot lose half of the staff and maintain services, no matter how dedicated and hard they work. Philosophically, her position is to not support strapping the organization with trying to cut back to the point of tying one hand behind their backs and still offer all services. She would recommend to the Board, if we continue in this direction, that we look at wholesaling entire operations. They would have to decide what we want to offer. It would be challenging. As the County Administrator, she is analyzing the operation to be sure she knows departments are structured as she thinks they should be and see if there can be any consolidation of functions. She hopes for opportunities to save costs. She does not think she will be able to save $14,000,000. She thinks the Board is going to have to look beyond County operations. It is not popular to talk about Constitutionals but if you do the math, the money is not there for County operations to bear the entire anticipated gap. Mr. Mundt believes the Constitutionals have worked hard at it. Obviously, the Sheriff’s department is the big number. Ms. Outlaw agreed but the fine line difference in her mind is there is a clear difference in maintaining expenses and cutting back by 15-20% like County operations has done. She is not suggesting they cut 15-20%. But there is a difference in her mind in them maintaining and her operation cutting back 15-20% and still be expected to provide the same operations. Mr. Lounds asked if the Constitutionals cut back 15-20% would we be a long way up the course toward $14,000,000. Ms. Outlaw has not run those numbers. She is not Citizens’ Budget Committee September 18, 2009 Page 4 suggesting 15-20%. Her point is that they have to cut back the same as County operations. She does not know the percentage. The County cannot continue to cut back and everyone else maintain level funding. Mr. Hensley asked if the Clerk and Property Appraiser had balanced their books and paid money back every year. Ms. Outlaw answered that the County does not fund the Property Appraiser or Tax Collector. Mr. Hensley said you can’t ask them to cut back since they give you money. Ms. Outlaw said she can ask. They may not do it. But she certainly can ask. The issue with the Clerk’s office is that in the past the Clerk gave back excess fees. The County made concessions on charges the Clerk would have picked up. The amount of money the Clerk has given back has all but vanished. They don’t think there will even be $100,000 this year. When the agreement was structured, the return was close to $2,000,000. In exchange for the $2,000,000 back, fees that the Clerk normally paid were picked up by the County. The money back has dropped but the County has continued to pick up the fees. The Board will have to look at the situation. Mr. Mundt suggested that rather than shutting down services, Ms. Outlaw go back to her staff one more time and ask what they need to provide essential services at a reduced level. He would hate to see an entire service area shut down. Ms. Outlaw said after completion of her review of County operations, she will be in a better position to say what approach she wants to take. She understands that at one point Administration suggested a 5-10% across the board cut. There were major problems with that. She does not know all the details. She does not want to say a percent across the board cut will work until she has a better comfort level of understanding operations. She agonizes in having to recommend to the Board that a particular operation be shut down. To be painfully candid, when services are reduced and complaints are received, everyone has selective amnesia that we are now cut from 15 to three employees and there is no way to provide the same level of service. She can’t take the organization to a position where they are beat on both sides. You don’t want to get out of an operation. You have to remind the public that we had to cut back to this level and it is physically impossible for us to provide the same level of service. You can’t have it both ways. We have to mature as an organization and say this is the level of service we can provide. While there will be some complaints, we have to do the best we can. Mr. Wells suggested Mr. Gill do Public Service Announcements to remind the public before cuts are made. He was in the Tax Collector’s office to get his tags renewed and was impressed with the service. Ms. Outlaw said they have not experienced staff cutbacks. She was glad they were able to do that. Mr. Wells renewed his tags for two years to save money. Will that affect the revenue? Ms. Gouin answered that the revenue goes to the State. The Tax Collector gets a portion for the service of collecting the fees. Mr. Wells feels the County’s occupational license is relatively inexpensive as a cost of doing business. You don’t want to run businesses away but wondered if they could be Citizens’ Budget Committee September 18, 2009 Page 5 increased. Ms. Outlaw said a review of revenue streams will be presented during Strategic Planning. She is not optimistic of the fees being increased because of last year’s discussion. But that may change. She cannot presuppose what the Board will do. They did increase the Development Review fee and added an Environmental Resource fee. They are looking at adding a fee for Public Works to development applications. Mr. Lounds commented on outside sources for Central Services. He believes in the current economy, there would be several companies wanting to do business with the County and do it well so they could keep the job. He keeps pounding on unfunded mandates. Is there a County that has not paid? What are the repercussions if we don’t pay? Mr. Long said the Sheriff would go to jail. It is State law. The legislature passes laws. You must follow the law or go to jail. Mr. Lounds does not think the State would put all 67 Sheriffs in jail if they all said it needed to be fixed. Mr. Long does not want his Sheriff to be the example. Mr. Lounds thinks there is a good relationship here. He thinks the Sheriffs’ association needs to address the issue. Mr. Lounds asked how much the Court system has to do because of unfunded mandates. Mr. Godwin answered millions of dollars. As an example, the County has to pay $2,500,000 for the State operation of the Juvenile Detention Center. They looked at not paying the fee and operating it cheaper themselves. The State would withhold the sales tax from the County. Ms. Gouin confirmed that the revenues from the State would be withheld. They have the authority. Mr. Hensley asked about comparing fees throughout the State. Ms. Outlaw said they looked at comparable Counties. When compared last year, some were low because they had not been increased in over 10 years. There were a number of Counties that have fees that we don’t. But the Board is trying to balance how many fees you can impose on residents and the business community. There was a lot of discussion on a boat ramp fee. The Board decided against it since they are trying to increase tourism. They looked at increasing some Parks and Recreation fees. Ms. Brisson reported on a meeting of the Recreational Advisory Board the evening before. They just completed a review of all the fees. It was a statewide comparison. They will bring a recommendation to the Board for some increases. There was a lot of discussion about youth fees. They felt it was more important to keep the youth occupied. They recommended lowering a couple fees. Generally, they are requesting a modest increase in most fees. Mr. Culverhouse asked about revenue from traffic citations. Ms. Gouin answered that the County does get part of it but there are specific items you can use it for. It cannot be used for operations. Part of it is used for the debt service on the 800 MHz system and part of it is put in the facility trust fund. Those facilities must be used for court operations. Ms. Outlaw thinks the crux of the challenge is operations that are funded by the general fund. Property taxes are decreasing and the balances at the end of the year are shrinking. Discretionary items such as travel, training and office supplies have been cut to bare Citizens’ Budget Committee September 18, 2009 Page 6 bones. A freeze was put on out of state travel a couple years ago. Some directors have paid their way to conferences to maintain certification. Travel is limited to within the State on a case by case basis. The departments can make the decision only if the event is on the Treasure Coast and they take a County vehicle. The travel budget is down to a minimum, so there are no savings at the end of the year. Discretionary memberships have also been taken out of the budget. They are working to true up the fund balance. Every dollar found will bring down the $14,000,000. She expects it to be less but does not want to be quoted. Mr. Mundt asked about lowering the fund balance policy and reducing the emergency reserves. How much would that produce? Ms. Outlaw has not formulated her position. The Board did not fund the addition to the Emergency Reserves. They may be open to leaving them at the current level. Based on their discussion, she does not think they will reduce the $17,000,000. Ms. Gouin added that as the operation budget decreases, the number for Emergency Reserves will decrease. The 5% will be less. If 5% was $15,000,000, Ms. Gouin thinks the Board would be more open to reducing the $17,000,000 because they would be observing the policy. They know what happened in 2004, so they are nervous about cutting the number any lower. Mr. Mundt knows they are going to check some fees. He feels they need to look at some big numbers. Observing the budget process, he did not see the political will to raise the millage. To get the $14,000,000, you’re going to have to look at the big numbers which are in wages, health and perhaps some operations. Mr. Mundt asked about minor wage reductions for all employees for a year to prevent layoffs. Ms. Outlaw said she was going to agree until he said up to the County Administrator. Seriously, they may have to take a look at it. She had worked in other organizations where furlough days and pay cuts were taken by higher paid employees. She will have to take a look at it. She does not know if she will recommend it to the Board. She will have to look at every option as part of her preparation for Strategic Planning. She may give them a menu of options to discuss and decide what they will support. Each one will come with different degrees of pain. It is not pleasant. The organization is already strained. The employees are picking up extra duties. It was not pleasant for her to forego her end-of-probation increase. She is in a position of leadership and must make sacrifices. It will not be pleasant. To not be able to recommend a cost of living increase is painful. Mr. Mundt asked what feedback she has received from staff. Ms. Outlaw said she will get their input in preparation for Strategic Planning. The departments will work on their plans for Strategic Planning after the Budget Workshop. They did have and will have discussion in their departmental strategic planning meetings. They will have input. The date has not been set for Strategic Planning. The plan is early November. Mr. Lounds thinks all the ideas have merit and we should look at personnel. But you get to a point where you can’t get rid of a $15 per hour grader operator and put a $10 per hour Citizens’ Budget Committee September 18, 2009 Page 7 tractor operator in that position. It doesn’t work. Whatever they find on the list will reduce the $14,000,000. He thinks the negative wish list and department suggestions are good ideas. He feels the best staff in the State is in the room. He would like to see results from the Economic Development Council (EDC). Ms. Outlaw reported on the controversy on Digital Domain. The EDC, St. Lucie County and Port St. Lucie were working on that deal. th There will be an announcement at the October 6 luncheon. Mr. Lounds thinks there should be more development around the Airport and Research and Education Park. Ms. Outlaw said they are intimately involved in getting a company into the Research and Education Park. They have the initial approval from Federal Aviation Administration (FAA) to modify the lease structures, which had been a barrier in the past. They realized that they have to be flexible. She thinks it will be a matter of months. Mr. Lounds said that business would stimulate other business. Mr. Lounds said it shows signs of progression and hope. Mr. McBee said that what the EDC does is for the good of the whole County. All the governments fund the EDC. Ms. Hensley added that you only hear about what comes to fruition. You don’t hear about what is worked on because it is confidential. Mr. Long wanted the group to know the Sheriff’s office did sacrifice. They lost 80 positions. There are mandated services such as the jail, deputies for courts and patrolling the County. The Sheriff has worked with the County and they, like the County, are understaffed. There are seven people in their IT department to take care of 600 computers in seven locations. They are running lean and will do what they can to cut costs. They are sharing the pain. Mr. Lounds asked about the County supplying the IT service to the Sheriff. Mr. Long answered that the needs of the Sheriff are completely different from the needs of the Library. You need to have people that specialize in your system. They do share some server equipment. Mr. Hensley said they were split because they could not have centralized IT service due to all the different requirements. Mr. McBee left the meeting at 8:37. Mr. Long said they have done a better job the last few years getting systems that talk to each other. Mr. Mundt said it comes down to deciding what are essentials and formulate from there. He thought about asking Florida Power and Light to prepay the taxes on the $1.3 billion they are requesting from Tallahassee to expand the nuclear power plant. Ms. Outlaw’s optimistic hope is we will be in a position with a fund balance number greater than the number in July, thereby reducing the projected shortfall of $14,000,000 and revenue options for the Board to consider. She plans to have gone through County operations and examined them from a number of perspectives. There has been an analysis of required services. All services will be put in order of priority with attached Citizens’ Budget Committee September 18, 2009 Page 8 dollar values. She hopes whatever staff cutbacks or service reductions the Board has to consider will be minimal. The unknown factor is how much the property revenue will drop. There will be some tough decisions. OTHER ISSUES th Mr. Lounds made a motion to combine the December 18 meeting with the meeting th scheduled November 20. Mr. Pancoast seconded the motion. It was unanimously approved. Mr. Lounds asked Ms. Outlaw what the Committee could do to help. She feels the dialogue generates ideas. Mr. Mundt thinks future thoughts should be sent to Ms. Gouin. ADJOURNMENT Mr. Hensley adjourned the meeting at 8:45 a.m. Respectfully submitted by: Brenda Marlin The next CBC regular meeting will be held on Friday, October 16, 2009, at 7:30 a.m., in Conference Room #3, at the St. Lucie County Roger Poitras Administration Annex.