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HomeMy WebLinkAboutBudget Minutes 07-14-2010BOARD OF COUNTY COMMISSIONERS ST. LUCIE COUNTY, FLORIDA BUDGET WORKSESSION 2010 Date: July 14, 2010 Convened: 9:35 a.m. Adjourned: 2:15 p.m. Commissioners Present: Chairman, Charles Grande, Doug Coward, Chris Dzadovsky, Paula A. Lewis, Chris Craft Others Present: Faye Outlaw, County Administrator, Lee Ann Lowery, Asst. County Administrator, Marie Gouin, OMB Director, Millie Delgado-Feliciano, Deputy Clerk Environmental Land Bond The County Administrator addressed the information requested by the Board at the previous work session and requested staff provides the update. Staff advised the Board they had borrowed 19.9 million of the 20 million dollar bond. In their discussion with the Bond Counsel, they were advised they would need a resolution declaring the project was completed and authorizing staff to take the proceeds from the capital fund to pay the debt service and an opinion be obtained that there would not be a problem with the IRS regarding taxes. Com. Craft stated where we are today if we can pay it off with what is left from the bond and free up that millage that is there, we will be better off today and it will be less painful in the future and this is what Bond Counsel recommended. The County Administrator stated not paying it off in advance, but placing the funds aside for when the payment is due. Com. Craft stated the Bond Counsel expressed his concern with having the money sitting there and not being utilized. The ERD Director stated the funds have been utilized over time. Com. Dzadovsky stated he is not interested in raising the millage and would rather pay it with the bond revenue. It was the consensus of the majority of the Board to make the payment of $178,000 as recommended by the Bond Counsel out of the proceeds and not raise the millage rate. Law Enforcement MSTU The County Administrator addressed a previous discussion relating to the Road Patrol deficit and possibly utilizing one time money. The Asst. County Attorney addressed the history of the settlement agreement made between the county and the two cities set up to 2005/2006. After that it states it is subject to negotiations. It does not specify that all the money would be paid for by the unincorporated residents, but it is still open for negotiations. The County Administrator stated that it was her understanding they could not utilize one time money from General Fund/Fine and Forfeiture monies due to the fact those are collected county wide and the cities have to approve this. The Asst. County Attorney stated this was correct. Com. Craft asked if the money could be loaned from the general fund. Com. Grande stated the problem can be alleviated if the percentage can be brought down to 19%. The Asst. County Attorney stated negotiations have not taken place in order to change the percentage. She recommends having the negotiations first to avoid it going back to a law suit. Com. Craft recommended advertising the higher rate and then after negotiations they can bring it down. General Fund/Fine & Forfeiture Fund The County Administrator updated the Board where they are today including current budget reviews and would like to look out as far as 2013 due the critical situation. She stated it looks as if they will be balanced for FY 2012 as well as FY 2011. She believes what lies ahead will be much more difficult to accomplish this than what has been accomplished today. She advised the Board what has been refined from the hard copy is the Constitutional's; she left their budgets at their presented reductions. She believes they are real close with the numbers with the exception of the $100,000. The County Administrator stated the total reduction from the General Fund/Fine & Forfeiture operating is $15,053,195 making the new General Fund/Fine & Forfeiture Fund operating budget $141,514,512. Com. Craft stated he would like for the general public to know how much the county has cut not only this year, but in the previous years. The County Administrator stated with the 2 year summary, FY 2010/2011 and 2011/2012, the projected revenues would be $141,514,512 adjusting the numbers based on the 10.8% property values, and all other General /Fine & Forfeiture Fund revenue streams, the new revenue figure will be $105,076,551, with a sustaining gap of $36.4 million for 2011. Next year they will utilize the same matching amount of $36.4 million which is a sustaining gap. One time money is non sustaining and for 2011/2012 keeping the expenditures where they are in 2011, of $141.5 million and based on the 5% projected reduction in property values and others revenue stream flat, the revenue for FY 2012 would be $100.7 million which would equal a sustainable gap of $40,795,468, with the accumulated fund balance money, there is a double benefit, they are projecting to have $32,0985,795 as one time money to use towards 2012 leaving a deficit of $7,809,673. The County Administrator advised the Board the money from the Sheriff, $875,000 a month for the Federal Prisoners the Sheriff was giving back to the county since March was not in the fund balance figures and this money is available. The $3.3 million she would like some direction on based on the change in the fund balance and emergency reserves policy. The new emergency reserves fund balance amount is $14,347,277 based on the new policy. The insurance fund reserves, the amount she is recommending that will come back to the Board is $1,893,134 and they will have some detailed discussion on this figure later. The FY 10 excess fees projected are $4 million, the return on the capital funds is $6.4 million has not changed, the $2.8 million is an item the Board has not seen and they are working on this, the transportation fund debt service was $43,000,000 and they only drew down $30,000,000 and they had pledged gas tax impact fees and have been paying it from the general fund and she believes there is enough in that account to pay that from the gas tax 2 impact fee next year rather than the general fund if the Board approves it and the Board would then have the $2.8 million, all total this amounts to $19.4 million of one time money. Com. Coward asked if this $19.4 million is included in the present budgeted figures. The County Administrator stated they are not, this is new found money. The County Administrator addressed the annual payment of Torrey Pines and the discussion held during Strategic Planning. The following were staff's recommendations • Pulling the economic development incentive payment out of operating equaling $7.5 million ($1.2 million for the next 6 years). • Taking non-profits from operating and designating funds for 2 years out on the basis that this will give them one year's notice if the Board cannot continue to fund • Taking the Special Olympics $64,000 out of operating ($32,000 for the next two years) • Image of Christ, $20,000 for the next two years = $40,000 • Contingency $2.7 million • Airport Subsidy from one time money ($162,635) opposed to canceling terminal project • SRO -1.62 million -this is an issue they will have more discussion on since this is the School Board's portion and she is not confident the cities will be coming back into the equation. Com. Coward questioned how many of the above items are already in the existing budget already identified for this coming fiscal year. The County Administrator stated the $19 million is in the total budget, but the Board has not approved the use of the money for these purposes. Staff advised the Board the 557 million is what the County Administrator budgeted to start with and included most of these items, during the strategic planning she received approval to move them from operating to one time money. Some of those already in were Torrey Pines, for one year, Special Olympics at a different level. Com. Coward asked what money is in the budget now and what one time money needs to be determined. The County Administrator stated the $19 million; all of it is in the budget and accounted for but has not been identified for specific things. Com. Coward stated there seems to be some inconsistencies and requested clarification. The County Administrator and staff addressed Com. Coward's questions. The money is in the $557 million and if you look at the items already in the operating budget, she can take the allocations for this year, Torrey Pines and the non-profits and can build it back into the operating budget and deduct it on the fund balance side. Com. Coward stated he did not believe they should hold such a large amount for Torrey Pines for 7 years having such a deficit. The County Administrator stated they have a legal commitment for that payment and if there is a problem in the future, the Board would have already set aside the monies to meet their legal obligation. Com. Coward stated he believes the country and the economy may be better in that length of time. He does not wish to heighten the budget crisis today. 3 Com. Craft stated if he is correct the only funds they should have an obligation to have is the contingency fund and Torrey Pines. He would like to leave the Torrey Pines money in the contingency fund. The County Administrator stated they have the $19 million and she has included the items discussed at Strategic and the additional items. Com. Grande stated his recollection at yesterdays discussion was that the Board was only going to fund the 1.2 million. Com. Lewis stated she still had concerns with the safety of the children at the schools. Com. Grande stated if the Board continues to provide everyone else's portion, then no one will step up to the table to fund their share. Com. Coward asked is it our responsibility to pick up other's portion for those who have pulled out. Com. Craft stated he would like to see where they will be at the end of the day and see what we can and cannot do. Com. Dzadovsky stated he wanted to maintain his position of only funding the 1.2 million for the SRO's. It was the consensus of the Board to fund the SRO program at the level of 1.2 million. The County Administrator stated the Board can come back and designate where they wish to utilize the 1.62 million. Insurance Fund The County Administrator had a meeting with the Clerk of Court and his Finance Director. In the discussion the Clerk had designated 1.5 million and she felt there was not a need to double up. She advised the Board of the calculation for the Supervisor of Elections and stated she still had to work with the Tax Collector, Medical Examiner and the Property Appraiser. The Clerk had calculated what was to be returned on the courtside and what percentage to the Finance Department. Parks and Rec. There is $100,000 on the Parks and Rec. side available and not designated. This was identified during their budget review. The FY 12 deficit is on the 5% drop in values and is anticipated to be higher. She recommends any additional one time money identified be first applied to the FY 12 budget deficit and second be applied against our obligation of Torrey Pines. The County Administrator stated FY 12 is balanced but not sustainable. It includes 46% of one time money, $255.8 million of which $78.3 is the general fund/fine and forfeiture fund and this is where we are anticipating the greatest deficit. To reach a sustainable budget position by FY 2012 end, she believes the Board will need to do additional cost reductions or enhance ongoing revenues or a combination of the two and not wait until we get into 2012. The County Administrator requested direction on the allocation of the undesignated monies. The Board will have the 1.62 million from the SRO program to designate to FY2012 or where they wish. 4 The Board will continue to pay their portion of 1.2 million; the 1.6 million was one time money for last year's program when the other partners opted out. Com. Grande stated he would like to designate the funding for Torrey Pines for only 2 years. He believes they are going too far out. Com. Coward concurred. The County Administrator requested direction and stated they have taken out the SRO funding. Com. Craft stated he would prefer to place it in the operating budget to cover the obligation and paying it out each year. Com. Dzadovsky stated he would prefer to keep it as originally proposed for 6 years having the obligation taken care of. Com. Coward prefers 2 years of funding. Com. Lewis concurs with the original proposal and would like to be sure they have the money to meet the obligation. It was the consensus of the Board, 3 to 2 to leave the funding as originally proposed. Com. Craft stated there is a larger picture and stated if they believed the numbers staff was presenting are accurate was going to remain constant and cannot be lowered any further, the question is, in 2013, do they believe the economy is going to recover enough to cover the deficit that year. He stated that for him he does not believe it will, and he felt the sooner they react with a millage increase, the less affect it will have on the public at any one time because you can spread the pain out over time and not hit them with one large increase. Com. Coward addressed having to close libraries and asked how we fund outside groups when we are not able to provide basic services. He is fond of the UDT Seal Museum, but cannot justify providing $42,000 when the county is in such a deficit. Com. Craft addressed the fact that in our budget there are other costs the county is picking up. The County Administrator advised the Board, the county provides $18,200 for the insurance. It was the consensus of the Board to leave in the $18,200 and remove the $42,000 for the UST Seal Museum. Mr. Craig Mundt, UST Seal Museum board member, addressed the Board and requested the Board reconsider their decision. He requested the board include this funding from excess fees for this coming year which is where the other non profits are being funded. The County Administrator advised the Board looking at 2011/2012, based on expenditures holding flat at $141,500,000 and revenues at $100.7 million and with a 5% projected property value reduction, the gap would be $40.7 million that they would need to close for 2013. The County Administrator advised the Board there are 8 mandated BOCC staff positions, 3 are in the general fund. She also reviewed the mandated services. Looking at 2013 and should the situation be as indicated, she advised the Board of the areas where they may need to cut out of operations or find another way to fund them State/Federal Mandated Services & Costs Constitutional Officers State Agencies (Statutory) $ 82,548,846 2,548,211 5 CRA Payments Debt Service Payment Other Financial Obligations Board of County Commissioners State Mandated BOCC Staff Positions Community Services Mandated Costs Co-op Extension Mandated Costs Health Department Mandated Costs Public Safety Mandated Costs BOCC Priority Hold Harmless Core Services Costs County Attorney Criminal Justice Veteran Services EDC ED Incentives R&E Park Sports Complex/ (Mets Agreement) FY13 POINT IN TIME SNAPSHOT Assumptions: GF/FF Operating Revenues GF/FF Operating Mandated Services Costs BOCC Priority Core Services Cost ($105,063,508) BOCC Residual Services to Be Addressed $ 3,877,000 $ 527,677 $ 1,770,814 $ 1,058,391 $ 450,369 $ 2,346,202 $ 249,728 $ 964,782 $ 130,409 $ 96,472,429 $ 1,294,277 $ 4,525,440 $ 443,208 $ 225,000 $ 592,709 $ 680,445 $ 830,000 $ 8,591,079 $100,719,044 $ 96,472,429 $ 8,591,079 ($ 4,344,464) • County Administration- eliminate the Asst. County Administrator's position, all Executive Aides to the Commissioners( The County Administrator's position is a mandated position); Media Services • Library Operations • Oxbow Services • Land Management Services • Library Services • Central Services • Budget Services • Purchasing Services • I.T. Services • Public Safety Services • Recreational Services • Grant Services 6 She stated the most difficult road they have to travel is in front of them. If they do not have any additional revenues by 2013 then they will be looking at further cuts of services. By 2013 if all the revenues hold and the expenditure hold at $141,000,000 they have a remainder challenge in looking to make cuts in the above operations. She stated it will be harder to do this than what they have already done. They may want to be looking at possibly getting with the cities and consolidating services. After this year's budget adoption, the Board wilt have more time to work through the difficulties and this would be a whole new process with the Board of County Commissioners and the County Administrator as opposed to staff recommendations. She believes they are more suited to bear the additional pain than what staff would be. Com. Dzadovsky stated they needed to make a valid statement that even if they lay off every employee; they would still not close in the gap. He stated he has been hearing from some of his constituents that they need to get the millage to an appropriate number. Com. Grande stated he does not see 5% as realistic; it seems to be too high. He stated we are making assumptions on the income side that may not pan out. The economists are saying we are getting better. He believes we are getting closer to normal. The County Administrator stated she hopes in 2012 the number will come in under the 5%, however in meeting with the Property Appraiser he indicated the 5% for 2012 was a number projected when the Board was continually requesting a figure in 2010 and he was reluctant to give a figure for 2012. He had stated he wanted to wait and come to the Board with a much better figure. She stated in speaking with Port St. Lucie, they anticipate coming in at 10% so she is estimating we should come in around 7%. Com. Craft stated even if we come in at a better percentage than anticipated, they still have a large gap to fill. He stated he is not comfortable with not making an adjustment in the millage for this coming year in order to prepare for 2013. He believes this would minimize the pain and is something they must do. The County Administrator stated she recommended raising the millage for the two MSTU's but had withheld making a recommendation for the county millage. Com. Grande stated he felt today was the worst time to increase the county's millage. He supports increasing the millage for the MSTU's, but he does not think we should start increasing the county's millage now especially since the budget is balanced through 2012. He believes the taxpayers of the county are in the same or worse shape than we are. Com. Craft stated he has not heard an alternative for the general millage and believes things are as low as we are going to go and start to recover. He does not agree with the rate of recovery. He believes it will not match the rate of decline. He does not believe they will get anywhere close to closing the gap by making additional cuts. In 2013 they will run into a wall and run out of money. He believes it's irresponsible not to make an adjustment at this point. The Management and Budget Director stated today they would need a 2.82% millage increase to have a sustainable budget in 2013. Com. Craft stated this was a figure where he did not wish to be. Com. Lewis stated she had concerns with moving forward assuming there would only be a 5% decrease. She believes they need to do something now. Com. Craft asked what the carry forward would be for 2013. 7 Staff advised the Board in the beginning nothing, however based on the recent Board direction; they are looking at $411,950. There will be some excess fees and although personnel is not turning over at the 10% but is at 2%. There will also be some transitions out of the organization. Even if you quadruple the figure, there will still be a huge shortfall for 2013. The Board asked the County Administrator for her recommendation. The County Administrator stated based on the information and what the Board has done in cutting Constitutional budgets and she believes there cannot be any additional cuts in those budgets, and looking at the County's budget placing all in context and all the operations the Board wants to hold harmless, she advised the Board she would recommend an increase in the millage by 1 mil, at a minimum the rollback rate in order to minimize the monsters the Board would have to face in the future. Com. Coward stated he believes what he is hearing from constituents is to keep the budget down and keep the millage as is to the best of their ability. He believes people would want to provide a limited amount of revenue assistance to provide the needs, but he does not support such a large increase. He stated he would not support roll back or a one mil increase. He stated the 2013 figures may be speculative and does not wish to raise the millage fora 3~d or 4th year out. Com. Craft addressed the fact that some residents will be paying less even with a limited increase due to the loss in property value and provided the example of his property. He stated he does not wish to do this anymore than anyone else. They have cut all they canto this point and if they cut next year, they will still have a gap. He stated he was willing to support rollback to make it a softer hit in2013. He stated he does not take this lightly, but felt it was something he needed to do at this point. Com. Grande stated he has advocated not having any type of increase in the county millage, but will support an increase in the MSTU's. Com. Dzadovsky recommended a half mil increase as a first step which is $50.00 on a $100,000 home. Com. Lewis stated she would support going to the rollback rate. She believes it is reasonable with what they are facing. She stated they can continue to economize and what helped her make this decision was if they go to roll back this year it would provide $11 million, if they wait until next year it will only be $3 million. Staff advised the Board the rates would be .9459 for the unincorporated area and .8092 for the incorporated area. Com. Craft stated if he could not get support for rollback, he would recommend the accumulative of the rollback to include the MSTU's. Staff advised the Board it would bring the millage to 6.7505 with revenue of $8,444,804 generated. The Board continued to discuss the millage rate among themselves (comments and discussion unintelligible). 8 Com. Dzadovsky stated he will continue to move toward bridging the gap and in the way of trying to find a compromise, he proposed rather than his first proposal of a half mil increase, he proposed taking the 2 two MSTU increases, reduce the half mil to .3633 and this would provide them 5.5 million for 3 years for a total of $16 million towards the $40 million gap, provides funding going forward, continuing to look for reductions and working with the Sheriff and looking to manage the jail with some savings, this would be $36.33 per homeowner with a $100,000 valued home which is not a huge burden. Com. Craft stated he cannot support it due to the fact they will not have carry forward funds. Com. Dzadovsky stated the impetus is for everyone to be more efficient. He is trying to find a compromise where they can start filling in the gap and look for other revenue sources outside. Com. Grande's comments were unintelligible. Com. Craft stated they had a recommendation from the County Administrator to go to a minimum of rollback and he recommended something lower. Com. Lewis stated she would support the accumulative rollback. This would provide her with some comfort level. Com. Coward stated he did not support any of the recommendations made and reiterated his position that he did not agree with the county residents paying for transit to Martin County to shop. At this time the Board could not reach a consensus and decided to continue the discussion on July 19th at 10:OOa.m. 9