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HomeMy WebLinkAboutMinutes 01-15-2010 CITIZENS’ BUDGET COMMITTEE Meeting Date: January 15, 2010 Conference Room 3 Meeting convened at 7:34 a.m. MEMBERS PRESENT: Carl Hensley, Chair Dana McSweeney Craig Mundt Nathaniel “Nate” Wells Patricia “Pat” Ferrick John Culverhouse Richard Pancoast Jay L. McBee Bill Casey Randy Ezell Dan Kurek Edith Hepburn Edward Lounds Ron Knaggs MEMBERS ABSENT: Bobby Rodriguez OTHERS PRESENT: Faye Outlaw Lee Ann Lowery Marie Gouin Jennifer Hill Carl Holeva Dennis Wetzel John Ferrick Laurie Waldie Paul Hiott Robert O’Sullivan Leo Cordeiro Roger Shinn Debbie Brisson Bill Hoeffner Karen Smith Joe Smith Bill Hammer Toby Long Garry Wilson CALL TO ORDER Mr. Hensley called the meeting to order at 7:34 a.m. ELECT CHAIR & VICE CHAIR Mr. Hensley asked if the Committee would like to proceed in electing the Chair or wait until later in the meeting. It was decided to go ahead. He turned the meeting over to Ms. Outlaw. She asked for nominations for the Chair. Ms. Ferrick nominated Mr. Hensley. Mr. Lounds asked if Mr. Mundt is still the vice chair. He is at the moment. Mr. Lounds moved the nominations close. Mr. Culverhouse seconded the motion. Mr. Hensley was approved unanimously. Citizens’ Budget Committee January 15, 2010 Page 2 Mr. Hensley asked for nominations for vice chair. Ms. Ferrick nominated Mr. Mundt. Mr. Lounds moved that nominations cease. Mr. Mundt was unanimously approved. APPROVAL OF MINUTES th Mr. Mundt made a motion to accept the October 16 minutes. Mr. Pancoast seconded the motion and it passed unanimously. APPROVAL OF MEETING DATES Motion and second to approve the meeting dates (see attached). There can be changes made later in the year if desired. The dates were unanimously approved. Mr. Hensley asked the members to sign the attendance sheet and the form showing they received the Pocket Guide to Florida’s Government-in-the-Sunshine Laws. UPDATE ON STRATEGIC PLANNING Ms. Outlaw said she would give an update on Strategic Planning and advise the members of the challenges of this year’s budget process. Strategic Planning was roundtable discussions focused on the General Fund and Fine and Forfeiture Fund grouped by the kind of services provided. It was planned that the entities invited would begin in the November meetings to suggest cutbacks in their organizations. The sustainability measures would be cost savings, cost reductions or revenue enhancements. The organizations knew it would be a challenge. They have very limited ability to raise revenue. They are at the point of cutting budgets. Ms. Outlaw has not moved forward in scheduling the February meetings because she did not think the entities embraced the message. She does not want to go through an exercise in futility. The suggestions she has heard since Strategic Planning have been on how she could cut her budget. She would like the ones telling her how to cut her budget to also tell her how they will cut theirs. She did not get any of that. She does not want to set up a session where folks take a look at each other’s budget but not their own. The Board agrees that nobody wants to cut their budget. The July budget reviews did not start as Ms. Outlaw expected. One commissioner was adamant that rather than review the department budgets, they should start making cuts. It was a fight to be allowed to make the presentations. She has looked at the numbers for future years and will come in making recommendations for cuts. Mr. Hensley asked if there was any chance of any kind of revenue enhancements. Ms. Outlaw said at this point, the Commissioners are opposed to any millage increase. There is a potential $37 million gap. If there is no increase in millage, that leaves just cutting the General Fund and Fine and Forfeiture Fund budgets. Unlike the Federal Government, the budget must be balanced. The primary reason for the gap is the one-time money has Citizens’ Budget Committee January 15, 2010 Page 3 diminished. Balancing the budget by cutting will be painful. Mr. Casey asked about the way permits are given for new projects. He asked about expediting projects. New businesses and buildings bring revenue to the County. Can we think outside of the box for solutions? He gave an example of a physician who wanted to open an urgent care center. He spent almost $200,000 getting the things requested and still had nothing approved. So he went into an existing building. It would have been revenue from the property value of the new building. Ms. Outlaw was aware of the situation. What they have done is form work groups to look at the development review process and building permit process. They flow-charted the various steps involved, what is required for approval. It forced them to take a look at the information required and how it is processed. It is on the website. Ms. Lowery oversaw the process done by a team from various departments. There was a change in the notification process of development applications. The owner and representatives are informed of what is needed. Sometimes the owner was told by the consultant that the County was holding up the application when that was not always the case. There have been several meetings with members of the business community to try to hear and work through their problems. They have worked through a lot of the issues. Another issue for Growth Management was all the changes in staff. Development applications were put on hold for 60 or 90 days. Ms. Outlaw believes we are past those situations. Now there are very few commercial applications. They should be expedited. The Board made commercial building permits a priority. A process was put in place. Mr. Casey asked if different departments were able to work together. Ms. Outlaw answered that the work group was comprised of reps from Growth Management, Building, Environmental Resources Department, Public Works and Utilities. The work product is on the County’s website. A lay person should be able to look at the flow chart and walk through what is required and understand the process. It should be a breeze for an expert. Mr. Casey thinks there should be a public announcement. He thinks a person who might go to another County would come here, even if it was more money, if they thought their project would be expedited. Ms. Outlaw said she would give thought to his suggestion. She is in the process of getting on the schedule with the Economic Development Council to do a presentation on the processes to members of the business community. She also plans to speak to the Chamber. Mr. Mundt reviewed Mr. Furst’s prediction of 10% decrease in value that he changed to 11.5% for 2010-2011 and asked if there was any further word. Ms. Outlaw answered that Mr. Furst has not changed 2010-2011 and is saying 5% for 2011-2012. He has said the commercial property is going to take the big drop. Copies of information that was presented at Strategic Planning were distributed to the members (see attached). In addition to the dropping property values, another challenge is the reduction of one-time money. Mr. Casey asked for an explanation of Fund Balance Forward and asked if the Emergency Citizens’ Budget Committee January 15, 2010 Page 4 Reserve was included in the amounts. It is not. That money is restricted. One discussion Ms. Outlaw plans to have with the Commissioners is if they would like to take some money from the Emergency Reserve to use toward the gap. Mr. Casey asked if the Emergency Reserves were fully funded. Ms. Outlaw believes they are. Mr. Knaggs asked for clarification about the 5% of expected revenue that you cannot budget and the 5% the Commissioners decided to set aside. Ms. Outlaw explained the formula used in page three of the handout and how those numbers were used on page four. We are already increasing the amount of one-time money that would be available for 2011-2012. She has put a freeze on hiring. She has not filled the second Assistant County Administrator position or an assistant position in her office. Vacant positions are not being filled and they are keeping a running total. Hopefully, there will be savings from other areas. The $18,000,000 fund balance available for FY 2011-2012 amount should increase, but it may not be substantial. Mr. Knaggs asked for an explanation of the numbers in the last two columns of the last page. Ms. Outlaw explained how they were achieved. Mr. Casey asked why four of the Constitutionals’ budgets are the same amount when revenues are going down. Can we ask them to cut? What incentive do they have to cut? Ms. Outlaw answered that their budgets have not been cut because the Board has not directed they be cut. Recommendations of cuts are made through the budget process. The State requires the Board to fund certain entities. The level of funding is to be determined in the budget process. The Property Appraiser and Tax Collector are fee based. She will propose cuts. We will have to wait and see the Board’s decision. He asked if it was unreasonable to expect them to return surplus. That is what excess fees are. Ms. Hill explained that the difference in the Sheriff’s budget is the one-time money for the School Resource Program. Mr. Casey asked what incentive they have to make cuts. Ms. Outlaw said her approach is that each entity knows their budget better than anyone else. They would know the service impact of cuts and be able to inform the residents. We have avoided significant service impacts by using the one-time money. She does not see us being able to do that in the future. All of the capital has been taken out of the budget. They are now, unfortunately, looking at personnel, occupied positions. Rather than doubling up on duties, there will be three to four times as much to do. Service will be cut back. Mr. Mundt asked about Other under BOCC Total Appropriations. Ms. Gouin answered that they were one-time revenues that will be gone because they will be used for operations. Mr. Lounds said there is a tremendous deficit in 2012. There is a big difference in corporate and government budget that is hard to understand. He thinks she should divide Citizens’ Budget Committee January 15, 2010 Page 5 the departments between essential and non-essential. Then divide essential between life- support and life-saving. The Sheriff is life-saving. The Health Department and Mental Health is life-support. If you need a 10% reduction, weight essential services heavier than non-essential services. He’d rather have the rescue squad come to his house than have the roads graded. He’d rather see the County maintain current buildings than build new ones. He’d rather see them grade than pave. It is a tough decision. The elected officials want special projects and expect her to find the money. He gave his opinion on services the County has to offer. The citizens are going to have to understand that there is no more money. He thinks a lot of folks understand but he thinks there is a group of management in the County that doesn’t. We cannot afford any added expenses. They have to say stop. It is time for hard facts. He thinks the Constitutionals also need to ask the essential/non- essential questions. If you take the emotions out of the question, the answer is not that hard to find. He doesn’t know how to answer people who ask for special projects. Ms. Outlaw said he made a number of excellent points. Her approach will be similar except to refer to the services as essential or non-essential. It is difficult for her to tell an operating department that they are not essential. She is taking the approach of what the State mandates the County fund. They are working on a matrix. They are identifying amounts and if there are grants or other obligations to give the Board a full picture. Ms. Outlaw thought it was interesting that Mr. Lounds said to identify essential and non- essential in departments. They have not gone to that level. Mr. Lounds said they should. She thinks that is a good suggestion. Mr. Lounds used Road and Bridge as an example. It is a hard process. He said it is easier in corporations. Mr. Lounds gave his opinion on grants. If we do not have funds to maintain, they may not be what we need. Mr. Wells asked about the millings at a project on 95. Mr. Casey has been told they belong to the contractor. They reduced their upfront bid because they are allowed to use them. Mr. Kureck asked at what point all sheriffs in the State dig in their heels and say this is it. Mr. Long said every budget presented by the Sheriff was approved by the Board so they must have thought it was a good budget. The Sheriff will do everything he can to help with the budget except compromise public safety. It won’t happen. They have always worked with Ms. Outlaw and the budget department. We need to be careful of what happens in the Cities. Calls for service are growing. He thinks the Cities will do away with their specialized services, which will leave them to the Sheriff. There is a point where the Sheriff cannot cut his budget any further. The Palm Beach County Sheriff received an increase in his budget. What Palm Beach County would not do that Sheriff Mascara did, is tell the union that they are not getting a raise, even though they have a contract. Lawsuits have and will be filed. The Sheriff does have recourse if the County does not fund his department. Mr. Knaggs asked if they were able to bill the Cities when they provide a service there. Mr. Citizens’ Budget Committee January 15, 2010 Page 6 Long answered they do not. By statute the Sheriff must provide service to the entire County. If they give up their police department, would it all fall to the Sheriff? Mr. Long believes they would contract with the Sheriff. They would understand that without additional resources, the Sheriff would not be able to supply a high level of service to the residents. That is what is happening in larger counties. They save on duplications. They could say we are closing down and walk away. Mr. Lounds said no budget format is easy. If you spend now to save later, it is the correct move to make. You do have to stop some projects, such as new buildings. Ms. Outlaw said that has stopped. There is no capital in future years. Mr. Lounds predicts there will be requests for special projects. Ms. Outlaw said that kind of requests always come up and she expects them to continue. The reality of where we are is the Board would have to make the decision of what would come out if they wanted a special project. In the past, budgets were not funded so tight. We are no longer in that situation. Mr. Lounds talked about businesses coming to St. Lucie County as a revenue source. He doesn’t know how to fund the increased activity of community development other than giving dollars to outside agencies. Ms. Outlaw clarified that he meant on the growth management side. Mr. Mundt said that he is sure Ms. Outlaw has asked departments to think outside the box. He saw an agenda item for $33,000 for maintenance of landscaping of a median. Why not rip it out and go to Xeriscape? It might cost more now but save in the future. People have done a good job, but they are going to have to press more. Mr. Hensley said the Constitutionals are elected by the people and maintain their own budgets, but they do get assistance from the Board. He does not think the Board wants to get in a fight with them, especially the ones that return excess money. Mr. Long said the Board cannot legally tell them what to do. Mr. Casey asked what incentive the Constitutionals have to make the tough cuts. Citizens don’t know how bad it is. They will get complaints if they reduce their services. Mr. Lounds asked Ms. Outlaw for her thoughts. She is working on several scenarios. She has started briefings with the Board. It is a grim situation. Mr. Lounds asked what the Committee can do. Ms. Outlaw asked if they want to be involved in making recommendations, such as prioritizing services. Do they want to look at the situation on a function or program basis? The gap is so big, line item recommendations will not get them to where they need to be. She thinks the Committee should look at approaches. Mr. Lounds is not sure the Committee is focusing on what it should. He believes the Committee should advise the Board of community trends, how the community feels. He is not sure the Board listens when they give it. Overall, he thinks they should support Citizens’ Budget Committee January 15, 2010 Page 7 Administration and the department heads. He would like Ms. Outlaw to give them outlines of what they need to do to support Administration. He would like to see Ms. Outlaw give the criteria of what she needs, so department heads and the Committee could give input. They could not make the decisions for her. Mr. Hensley said recommendations should be given to the Commissioners or staff. He doesn’t know how many members talk to the person who appointed them or staff, but they listen. Send your suggestions to Ms. Outlaw or the Board. Mr. Mundt asked about excess fees in future years. He would think the Constitutionals should have enough history to budget more tightly and reduce the amount they request. He thinks that should impact the budget and show some thought. Ms. Outlaw agreed that it would be a possibility. Mr. Casey asked if he was the Tax Collector, why would he do that. What would happen if you needed the money? You would not get it. There is a bigger detriment to budgeting closer. You get good press and maybe a picture if you return the money at the end of the year. You get nothing for budgeting closer and it is harder. Mr. Mundt believes if you are a million dollars over consistently, you could knock $500,000 out. Mr. Lounds asked how many members are involved in banking. Are they overrun with commercial requests? Ms. McSweeney answered they are getting more and are not involved in residential. Mr. Casey said they increased their commercial lending last year about 30%. Ms. McSweeney said they are getting more referrals and requests but they are not all approved. Mr. Lounds feels more requests are a good sign. Mr. Casey said commercial activity is dramatically down. The difference is banks that have the ability to do things they want to do are seeing an increase because other banks are restricted by regulators. OTHER ISSUES Ms. Outlaw was encouraged to keep up the good work. She has the support of the Committee. ADJOURNMENT Mr. Hensley adjourned the meeting at 8:59 a.m. Respectfully submitted by: Brenda Marlin The next CBC regular meeting will be held on Friday, February 19, 2010, at 7:30 a.m., in Conference Room #3, at the St. Lucie County Roger Poitras Administration Annex.