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City of sanger

Overview of 2011 proposed budget. City of sanger. Defunded Five Positions Maintained Service Levels Continued Infrastructure Improvements Cut spending early to avoid impacting services Avoided layoffs and furloughs by leaving non-essential positions open when possible

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City of sanger

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  1. Overview of 2011 proposed budget City of sanger

  2. Defunded Five Positions Maintained Service Levels Continued Infrastructure Improvements Cut spending early to avoid impacting services Avoided layoffs and furloughs by leaving non-essential positions open when possible Added Debt Service Fund and Capital Improvement Fund and Merged Smaller Departments Review of 2010 budget

  3. Department Name Changes • Parks is now Parks & Recreation • Data Processing is now Finance • Reclassifying Accounting Tech. Position to Finance Director • No Merit Raises Planned for 2011 • Significant Cuts in Operating Expenses • Funding for Capital Projects Maintained 2011 Budget Highlights

  4. 2011 Budget Highlights Continue to Build Reserves

  5. Strengths • Location, Location, Location • Quality of Life • Electric Utility • 4A & 4B SWOT Analysis

  6. Weaknesses • Dependence on Property Tax • Ratio of Residential to Commercial • Median Home Price • Water CCN SWOT Analysis

  7. Opportunities • Industrial Development • Residential Development • Commercial Development • Threats • Depreciation of Property Values • Decreased Sales Tax Revenues • Increased Cost of Goods & Services • Lack of Emergency and Operating Reserves SWOT Analysis

  8. Six Semi-Autonomous Funds • General Fund • Enterprise Fund • 4A Economic Development Funds • 4B Economic Development Fund • Debt service Fund* • Capital Improvement Fund* * New Funds Understanding the Budget

  9. Budget Process • Spring – Staff begins estimating revenues and expenses and researching the cost of capital projects and equipment • Early Summer – Staff submits proposed budget to City Manager – City Manager balances revenues and expenditures • Summer – Council holds workshops and public hearings on the budget Understanding the Budget

  10. Budget Process Continued • September Final Budget is Adopted • October First – New budget begins • January Property Tax revenue starts coming in and Capital purchases begin • April – Process starts again for next year Understanding the Budget

  11. Revenues are estimates Revenues do not appear in the bank October First – they come in over the year Revenue shortfalls mean cutting expenditures City Operates on a Cash Basis Conservative revenue estimates Control of costs and budget management Important points

  12. A large proportion of our costs are set costs and are unchangeable. This includes bond and lease payments Another large portion of our costs are “automated”, meaning that we do not control the increases. This includes all insurance and water purchases The bulk of the rest is “current” costs or what it takes to maintain current service levels What little, if any, that is left can be used for capital improvements, increased personnel benefits or increased service levels Important Points Continued

  13. Property Taxes Collected in January 2011 are based on Property Values from 2009 • Property Tax is Made up of Two Components • Interest & Sinking Rate (I&S) • Maintenance and Operation Rate (M&O) • I&S Rate is Determined By Debt Obligations • M&O Rate is Determined By Council • I&S Rate is About 19¢ • M&O Rate is About 43¢ Understanding the property tax

  14. Effective Rate – Rate that will service the debt (I&S) and generate the same amount of operating money (M&O) as last year Rollback Rate – 108% of Effective Rate. Any increase over the rollback rate is subject to challenge by petition Setting a rate below the Effective Rate means a decrease in revenue. That decrease comes 100% from the M&O rate Understanding the property tax

  15. Property Tax Varies Widely from City to City Based on Many Factors • Sanger’s is About Average for the Area and for Cities With a Similar Size and Valuation • Lowering the Property Tax Long Term Requires • A Higher Ratio of Commercial to Residential • Higher Residential Values • Carefully Managing Debt Understanding the property tax

  16. Expenditures • Revenues • Property Tax • Sales Tax • Court Fees • Fire and EMS fees • Franchise Fees • Enterprise fund Transfers General Fund

  17. Composed of revenue generating utilities (Water, Wastewater, Electric) Intended to generate revenues in excess of costs Excess Revenues can be used for infrastructure improvements and help support the General Fund Currently only Electric generates significant excess revenues Enterprise fund

  18. Enterprise Fund

  19. Water currently operates at a deficit Wastewater barely breaks even Electric is supporting the other enterprise utilities Water and wastewater rates need to be raised incrementally over the next few years to lessen the impact on customers 2010 Rate Study

  20. To bring water out of operating at a deficit To save money toward the new wastewater plant (Save 10% of wastewater revenues) To help pay for the new wastewater plant when it is built To help pay for some water and wastewater capital improvements without having to go into debt Why rate increases are necessary

  21. Water and Wastewater – 10% increase except for residential base rate increase of 6% Will work out to be a 7% to 8% increase for residential customers This is the same as last year Will still leave us generally below the average on utility rates of cities in the area of similar size Proposed rate increase

  22. Impact on residential customers

  23. Revenues from Sales tax (1/2c each) • 4A Expenditures • Warehouse • 4B Expenditures • Sports Park • Administrative Costs – Requesting $18,000 from each this year Economic Development Funds

  24. Created to make general fund budget more understandable Also helps track project costs Debt Service Fund is funded by the I&S Rate Capital Improvement Fund is an internal service fund where bond proceeds are deposited and expended on projects Debt service and capital improvement fund

  25. conclusion The goose and the Golden Egg

  26. General Fund Department highlights

  27. Used for expenses that do not fit inside one department Includes Postage, Property and Liability Insurance and Tax Collections Also includes line items for Keep Sanger Beautiful and Park Board for better tracking of expenses Non-departmental

  28. Split 50/50 between GF & EF No major changes this year City council

  29. Split 50/50 between GF & EF Moved TML Insurance and Tax Collections to Non-Departmental Moved Administrative Assistants Salary from Data Processing (Finance) to Administration Administration

  30. Split 50/50 between GF & EF No Major Changes Public Works Administration

  31. Includes $7000 to support the Child Advocacy Center Funds to purchase and equip only one vehicle next year Includes $38,000 for Dispatch Services from the County Police Department

  32. No Major Changes Animal control

  33. Includes two grants totaling $40,000 in matching funds if grants are awarded Does not include SAFER grant Adds funds for dispatch services Fire Department

  34. No Major Changes Ambulance

  35. No Major Changes Court

  36. No Major Changes Development Services

  37. $100,000 for street improvements to be used for leveraging County funds $50,000 for continued sidewalk expansion Moved two positions from Parks to Streets to reflect new workforce structure streets

  38. Moved two positions to Streets Now includes the Sullivan Center and Community Center budgets Parks & Recreation

  39. No Major Changes Fleet Services

  40. No Major Changes library

  41. Pared back to reduce Transfers from 4A & 4B Economic Development

  42. Enterprise fund

  43. Includes Safety & Incentive and One Plus Fund Includes line item for reimbursement of Damage Claims Includes $50,000 in contingency reserve to hedge against revenue shortfalls and for emergencies Non departmental

  44. Used to be Data Processing Reclassified Accounting Clerk to Finance Director Moved Administrative Assistant to Administration finance

  45. $40,000 in contingency reserve for unexpected repairs $50,000 in water line improvements water

  46. $150,000 for Wastewater system improvements including I&I study Waste water

  47. Includes $125,000 for lighting at the Sports Park Includes $90,000 for system Improvements Includes funds for a stump grinder that will be shared with other departments electric

  48. Looking at funding significant utility improvements in the industrial area Approximately $400,000 fund balance Requesting Transfer of $18,000 to Economic Development Department 4A

  49. Pledged $180,000 to Sports Park Fund Balance of Approximately $500,000 Requesting $18,000 for Transfer to Economic Development Department 4B

  50. Planning on another lean year Continue to fund capital improvements to aging infrastructure Continue to build reserves Continue planning and preparing for the future summary

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