HomeMy WebLinkAboutStudy Session Minutes Budget 2015-10-09
Town of Estes Park, Larimer County, Colorado, October 9, 2015
Minutes of a Regular meeting of the TOWN BOARD BUDGET STUDY
SESSION of the Town of Estes Park, Larimer County, Colorado. Meeting
held at Town Hall in said Town of Estes Park on the 9th day of October,
2015.
Board: Mayor Pinkham, Trustees, Ericson, Holcomb, Koenig,
Nelson, Norris and Phipps
Attending: All
Also Attending: Town Administrator Lancaster, Assistant Town Administrator
Machalek, Finance Officer McFarland, Director Muhonen,
Manager Fraundorf and Town Clerk Williamson
Absent: None
Mayor Pinkham called the meeting to order at 8:30 a.m.
2015 BUDGET PRESENTATION
Administrator Lancaster stated the goal in developing the 2016 budget was to present
the Board with a balance budget. The 2016 budget continues to use fund balance;
however, the budget has moved in a direct of decreased spending by decreasing
funding to the IT and Vehicle Replacement funds. Staff also cut department budgets by
approximately $1.7 million to eliminate spending in 2016. The main issue continues to
be the cost of flood recovery and the timing of reimbursements. A number of ongoing
projects such as the parking garage, Moraine bridge replacement and Broadband may
have impacts the on budget that are not fully understood. The parking structure NEPA
study has been completed by the Bureau of Reclamation. Staff has identified a CSU
professor to develop a feasibility study for Broadband take rates to be completed by the
end of 2015 to assist the Town in determining if a new utility should be developed or the
Town partner in a public-private partnership. Funds have been awarded by DOLA to
provide engineering for the Moraine bridge project and develop costs. Staff has made
assumptions in the development of the budget due to the flood recovery reimbursement
uncertainty. Sales tax revenues have been strong which has aided the fund balance.
The 2016 Strategic Plan was used to develop the budget presented to the Board for
consideration.
Finance Officer McFarland commented the Town’s fund balance has gradually declined
over the recent year. Recent dips have been a direct impact of the flood recovery and
reimbursements. The Board’s policy of 25% fund balance was maintained until the
flood in which the balance dropped to 20%. Staff estimates the balance at 21% by the
end of 2015 and stabilizing in 2016 with flood recovery reimbursements. The Tabor
reserve is maintained in the General fund and is on top of the unrestricted fund balance
for the General fund. Three items affect the General fund, including sales tax, Event
Center revenues and personnel costs. Sales tax continues to run 10% above budget
projections. Sales tax has been budgeted with a 4% increase in 2016. The Event
Center income has a forecasted shortfall of approximately $400,000 and expected
revenues have been decreased for 2016. Personnel costs comprise 52% of the
General fund and 28% of the entire Town budget. There are $5 million in budgeted
flood expenses and accompanying reimbursements in the General fund for 2015;
however, only $2.1 million would be completed in 2015. An additional $2.9 million
would be allocated in 2016/2017 for the Fish Creek corridor. The float time between
flood expenditures and reimbursements would need to be very narrow when
construction of Fish Creek begins with approximately $2.5 million in expeditors
expected.
The General fund revenues include sales tax, transfer from Light and Power, Events
revenue, property tax, business and liquor licensing, vehicle taxes, building and sign
Town Board Budget Study Session – October 9, 2015 – Page 2
permit fees, Highway User Trust fund, franchise fees, and building rent. Administrator
Lancaster stated the County would propose increasing the Road and Bridge mill levy by
4-6% to fund improvements to the I-25 corridor. The mill levy is shared 50/50 with the
community in which it is collected. The County requests the Town rebate its portion of
the new tax, approximately $39,000, to be used as matching grant funds for federal
grants to improve I-25.
Trustee Ericson requested staff establish an estimated loss in revenue by not allowing
marijuana sales within Town limits. Finance Officer McFarland stated two CAST
communities have collected approximately $100,000 in revenues through July. Mayor
Pro Tem Koenig stated the implications of allowing marijuana sales should be
considered as well as the revenue benefits.
INTRA-FUND TRANSFER
The fund has been used to transfer funds from the General fund to the Community
Services funds for their operations in the past. In 2015, the Community Services funds
were added back into the General fund and transfers were eliminated. In 2016,
$520,000 would be transferred from the General fund to pay for the Certificates of
Participation (COPS) to repay the loan for the construction of the Event Center and
Pavilion buildings. An additional transfer from the General fund of $435,000 to the
Street Improvement fund would be made for street improvement projects (STIP).
Mayor Pro Tem Koenig state the STIP funds could be used to fund a storage
facility for street equipment rather than funding the sales tax account with
additional General fund dollars. Director Muhonen requested staff complete the
street assessment to determine the funds needed to bring the roads up to 70%
standards by 2025 prior to reallocating street improvement funds. The assessment
would be completed in 2015. The Street division does need a facility to store snow
plows and the pothole truck in order to run the equipment effectively in winter months.
1A sales tax funds could not be used to construct facilities for equipment.
Administrator Lancaster reviewed other fees such as the increase in Community
Development land use fees to enhance the services of the department. Staff continues
to review the possibility of adding a storm drainage utility to collect fees from residents
to fund planning and upgrades to the storm water drainage system. Currently Light and
Power imposes a sales tax on electricity and Water does not. The Water department
could impose a sales tax. Staff has discussed the development of a strategic plan for
annexation of key retail locations to collect additional sales tax. The first order of
business continues to be identifying way to work more efficiently and eliminating waste.
Trustee Ericson stated the Town has made commitments to the voters in the past with
the establishment of the Local Marketing District and the approval of the 1A sales tax to
continue to fund the $800,000 previously earmarked for marketing into the Community
Reinvestment fund for infrastructure improvements and the $435,000 into the Street
Improvement fund. He stated concern with the Board’s credibility by not maintaining the
funding commitments, the fund balance of the Community Reinvestment fund, and the
reinvestment into infrastructure improvements.
COMMUNITY REINVESTMENT FUND
The Community Reinvestment fund serves at the Town’s capital project fund for its
governmental funds (General and Special funds). Funding comes from the General
fund, grants and Tabor excesses. Major projects for 2015 included the completion of
the Event Center, Elm Road mitigation, Conference Center roof repair, Conference
Center interior repairs paid for by insurance, Certificate of Participation (COPS)
payment and Visitor Center restroom upgrades. The Performance Park overlay has
been postponed for 2015 as the River Coalition requested additional time to develop
river channeling that may affect the elevation of the parking lot. In 2016 the fund would
continue to fund the construction of the parking structure, grant-aided electronic signs
on Hwy 36, sound dampening boards in the Event Center and COPS payment.
Revenues would include a transfer from the General fund of $520,000, $3.14 million
from parking garage grant, and grant funds for signage for a total of $3.7 million. The
Town Board Budget Study Session – October 9, 2015 – Page 3
fund also maintains $200,000 for the Museum storage facility. Expenses are estimated
at $5.17 million and a fund balance of $111,913 at the end of 2016.
Mayor Pinkham called a break at 10:15 a.m. and reconvened the meeting at 10:27 a.m.
EMPLOYEE COMPENSATION/BENEFITS
Eric Marburger/EMS Consulting Services was hired to complete the market salary
survey for 2016. After review of the market adjustments for the five market pay families,
staff recommends an average market adjustment of 2.3% for all position. Pay ranges
would be adjusted and employees would see a 2.3% increase as the first full paycheck
in 2016 with the exception of the sworn police personnel as they were adjusted in
September 2015.
The 2015 budget contains an 8% increase in medical and no increase in dental or vision
premiums. The Insurance Committee reviewed with the Town’s new benefit broker
Hays Companies the possibility of bringing back spousal coverage in 2016, and,
determined the Town would not be able to do so with the current claim history. This
issue would be reviewed on an annual basis. The Town would see a slight increase in
the fee for the Employee Assistance Program with a 7.7% increase in utilization. The
Air Ambulance service would be maintained for 2016 with membership covered by the
Medical Fund. A new benefit, Teledoc, would be added to the benefit program
providing 24/7 access to a doctor by all employees, spouses and dependents
regardless if they are on the Town’s medical plan. The Insurance Committee would
continue to investigate options to assist employees and provide a comprehensive
benefit package, research additional out-of-pocket cost mitigation tools/programs, and
continue to educate employees on how to maximize benefit offerings.
INTERNAL SERVICES FUNDS
MEDICAL
The fund maintains the medical premiums and fund balances as the Town moved to self
insurance in 2012. The fund has a balance of approximately $450,000. The Town’s
new benefit broker has stated a healthy balance would be 30% of the cost of insurance
premiums.
FLEET MAINTENANCE
To be presented at the October 16, 2015 meeting.
INFORMATION SYSTEMS TECHNOLOGY
Each department pays a fee based on the equipment the department utilizes (laptops
and computers, servers, audio and video components, software, copiers and telephone
components). The IT division would continue to update, simplify and consolidate the 1
gig network components while providing world-class support. Approximately $200,000
in IT expenses have not be allocated to other departments thereby reducing the IT fund
balance. The reduction of the IT fund balance would not be sustainable over time. The
division would collect $397,244 in fiber lease revenue. $71,000 has been budgeted for
capital purchases, including HTE financial software (Edge module), one server and
firewall/switch enhancement. The new software would allow staff to access data for
customers and staff more readily for studies such as the rate studies.
VEHICLE REPLACEMENT
The Internal Services Fund maintains a fund balance for future vehicle purchases with
approximately 100 vehicles in the fleet. In 2015, 17 vehicles were replaced at a cost of
$1.38 million. The 2016 budget contains 12 vehicles slated to be replaced at a cost of
$820,000. Three new vehicles would be added to the fund, including two L&P vehicles
and a new Cushman for the Parks Division. The fund has been identified as being
overfunded; therefore, funding has been reduced for 2016.
GENERAL FUND. Each fund was reviewed and requests for additional information is
noted below:
Town Board Budget Study Session – October 9, 2015 – Page 4
Legislative – In 2016 the budget reflects a reduction in funding for the Volunteer
Recognition program as staff would be reviewing changes to the programs.
Funds have been budgeted to purchase Netbooks for the incoming Trustees and
Mayor and to replace a laptop in the Board room.
Judicial remains flat with no material changes over 2015. The salaries for both
the Municipal Judge and the Municipal Court Clerk would be reviewed based on
market data and adjusted in 2016. Currently the two positions are adjusted on
even years with a 5% increase per the Municipal Code. Both positions would be
contract employment moving forward and the salaries adjusted annually.
Executive –The personnel and O&M budgets were reviewed and reductions
made to decrease expenses. The department would conduct a Community
Survey in 2016.
Administrative Services – A regular Municipal Election has been budgeted to
elect three Trustees and a Mayor through a mail ballot election. In lieu of
additional staffing the department has requested funding for contract labor to aid
with projects, including records retention, EPURA file organization, and day-to-
day operations. Consulting services were added to the budget to prepare a
recommendation to the Board on document management.
Finance – Personnel costs increase in 2016 with the addition of a Payroll
Technician. O&M costs decrease overall with IT costs decreasing.
Employee Benefits – This fund contains the homeownership program, tenure
awards, wellness program, benefit consultant, post-employment benefits and
employee gatherings. There are currently eight employees participating in the
homeowner program with four additional participants anticipated for 2016. The
2016 budget was reduced as the cost of benefit consulting services was less
than anticipated.
The next Budget Study Session is scheduled October 16, 2015 8:30 a.m. – 12:00 p.m.
There being no further business, Mayor Pinkham adjourned the meeting at 11:20 a.m.
Jackie Williamson, Town Clerk