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HomeMy WebLinkAboutMinutes - Minutes - City Council - Meeting Date: 4/6/2004 * PLEASE NOTE: Since the Glendale City Council does not take formal action at the Workshops; Workshop minutes are not approved by the City Council. MINUTES CITY OF GLENDALE CITY COUNCIL BUDGET WORKSHOP April 6, 2004 8:30 a.m. PRESENT: Mayor Elaine M. Scruggs, Vice Mayor Thomas R. Eggleston, and Councilmembers Joyce V. Clark, Steven E. Frate, David M. Goulet, H. Phillip Lieberman, and Manuel D. Martinez ALSO PRESENT: Ed Beasley, City Manager; Pam Kavanaugh, Assistant City Manager; Jon Paladini, Interim City Attorney; and Pamela Hanna, City Clerk 1. FY 04-05 BUDGET: 4TH BUDGET WORKSHOP This is a request for City Council to review the recommended FY04-05 supplemental requests for the following departments: Community Development Administration, Building Safety, Engineering, Planning, Transportation, Public Works Administration, Field Operations, Utilities, Environmental Resources, Community Services Administration, Library, Parks & Recreation, Community Housing & Revitalization, and the Civic Center. The material to be covered is attached. The attached information is the same as that found in the following tabs of the City Council budget workbook: Community Development Group, Public Works Group, and Community Services Group. Council's review of the FY2004-05 budget is consistent with the Council's goal of ensuring the city's financial stability. The budget process has been modified per Council's requests. Some of the more significant modifications include the following: • Council now receives quarterly presentations on GF revenues and expenditures; • Council now receives periodic presentations throughout the year on enterprise fund issues, such as water and sewer rate adjustments; • Council now reviews the CIP budget at the same time as the operating budgets for next fiscal year, as evidenced by the inclusion of CIP operating and maintenance supplementals as part of the operating budget process; and • Council now reviews all supplemental spending requests as part of the operating budget process. 1 A future FY04-05 budget workshop is scheduled for April 20, 2004. The 3`d budget workshop with Council occurred on March 30, 2004. This workshop covered the following projects and departments: Arena, Stadium, Westgate, Super Bowl, Administration, Code Compliance, Finance, Information Technology, Management & Budget, City Manager's Office, Marketing and Communication, Economic Development, City Auditor, and Intergovernmental Programs. The 2nd budget workshop with Council occurred on March 23, 2004. This workshop covered the FY 2004-05 Pay As You Go (PAYGO) capital projects for the General Fund (GF), the Capital Improvement Program (CIP) operating and maintenance supplementals, the FY 2005-14 preliminary CIP, and the FY 2004 preliminary carryover requests. The 15Y budget workshop with Council occurred on March 16, 2004. This workshop covered the GF budget balancing summary and the following departments: Human Resources, Fire, Police, City Court, City Attorney, City Clerk, City Council Office, and the Mayor's Office. The FY04-05 budget workbook was distributed to Council on March 2, 2004 for review prior to the scheduled budget workshop discussions. Council reviewed the FY04-05 GF revenue projection at the February 17, 2004 workshop. Council was presented with an overview of the draft FY05-14 CIP at the January 6, 2004, workshop. As a follow up to the January 6 workshop, a detailed report on the draft FY05-14 CIP was provided to City Council on January 23, 2004. The City of Glendale's budget is an important financial, planning and public communication tool. It gives residents and businesses a clear and concrete view of the city's direction for public services and operations and a better understanding of the city's ongoing needs for stable revenue sources to fund public services and ongoing operations. The budget provides Council and residents with a means to evaluate the city's financial stability. All budget workshops are open to the public and are posted publicly per state requirements. The recommendation was to seek direction from the Council on the recommended supplemental requests for the following departments: Community Development Administration, Building Safety, Engineering, Planning, Transportation, Public Works Administration, Field Operations, Utilities, Environmental Resources, Community 2 Services Administration, Library, Parks & Recreation, Community Housing & Revitalization, and the Civic Center. Finance Ms. Shirley Schurhammer, Budget Director, said Council asked staff to bring the Finance Department's Budget, specifically the lease payments supplemental request, back to Council when Mr. Art Lynch, Chief Financial Officer, would be available for questions. Mr. Lynch explained the Northern Crossings lease is the primary component of the $2.3 million increase in GF debt service obligations, with $680,000 in interest and $1.6 million in principal. He noted, however, interest earnings will help reduce the amount further. Mr. Lynch confirmed for Councilmember Lieberman that the city borrowed on a lease payment plan rather than selling bonds for the purchase of the Northern Crossings land, explaining the shorter term debt instrument allowed the city to achieve a lower interest rate. Councilmember Lieberman asked about the City's total GF capital lease debt service obligations for FY04-05. Mr. Lynch responded that the total amount for FY04-05 is $4,390,688. Councilmember Lieberman asked how Northern Crossings revenue from the sale of property is reflected. Ms. Schurhammer said revenue generated from lot sales at Northern Crossings totaled $2.6 million in FY02-03 and $1.6 million in FY03-04 for a total of $4.2 million. Councilmember Lieberman said the city has put $16 million into the Northern Crossing development. He asked about the development's projected city sales tax revenue for FY04-05. Mr. Lynch stated, in their effort to be conservative, they have not included any revenue beyond the sale of the last pads and parcels in the FY04-05 GF revenue projection. Ms. Schurhammer stated that the Finance Department projects city sales tax revenue for Northern Crossings as $1.1 million in FY04-05. She stated this is the information presented to Council at the March 16 budget workshop. She also reiterated that the $1.1 million is not included in the General Fund revenue projection for FY04-05. Councilman Lieberman asked the Lowe's parcel. Mr. Lynch responded that escrow has not yet closed. He said the exact amount of the sale would not be known until escrow closes. Councilmember Clark asked what Northern Crossings' parcels have been or will be sold and how will the other parcels be handled. Mr. Lynch stated the development agreement calls for the sale of the main parcels and pads and the lease of smaller shop areas. He confirmed the drug store parcel represents a sale. Councilmember Clark asked if a small shopping center is proposed for the east side of the development. Mr. Lynch stated he is not aware of a small shopping center, however, some of the smaller shops might be grouped together. He said he understands those parcels will be leased. Vice Mayor Eggleston stated Northern Crossings is an impressive development, expressing his opinion it will bring higher than expected income to the city. Mayor Scruggs agreed it is a great development, noting Wal-Mart will open April 14. She said the project was not only an economic development project, but also a massive 3 neighborhood revitalization project. Mayor Scruggs was called away from the meeting. Community Development Administration Ms. Schurhammer reported a base budget of $362,074, with no carryover requests and $21 ,160 in supplemental requests for the deputy city manager of the community development group. Councilmember Lieberman noted the budget for the deputy city manager of the community development group shows a 52% increase in its budget over last year. He asked if the increase reflects the addition of two employees. Ms. Schurhammer responded yes, explaining two secretaries were moved from the budget of the deputy city manager of the administration group into the budget of the deputy city manager of the community development group. Building Safety Ms. Schurhammer stated the Building Safety Department has a base budget of $3,094,087, with $55,100 in carryover requests and $117,079 in supplemental requests. Councilmember Clark asked why $125,703 is budgeted for the arena project in FY04- 05. Ms. Deborah Mazoyer, Building Safety Director, explained the City has not yet issued the final Certificate of Occupancy for the arena. While Ms. Mazoyer expects to complete tall inspections and issue a certificate of occupancy by July 1, she included a base budget funding request for FY04-05 in the event that deadline is missed. Councilmember Clark asked why the budget for the stadium project increased 76% when the number of employees increased 200%. Ms. Schurhammer explained a mistake was made in the Building Safety's stadium project budget for FY04-05. Specifically, the $817,115 originally reported in the Council Budget Workbook should be $543,225. Ms Schurhammer also stated that the eight contractual positions, and the associated base appropriation (3-year appropriation) originally assigned to the arena were moved to the stadium as construction of the arena was completed. Ms. Mazoyer said all stadium supplementals approved in the current fiscal year were for one-time funding, therefore, all had to come back in the form of supplemental requests. She said the $543,225 represents the department's base budget for the stadium project and it covers the salaries for the eight employees as well as their vehicles and consulting money. Ms. Schurhammer noted the rest of the expenses related to the stadium project for Building Safety Department were included in the supplemental requests Council reviewed at the March 30 budget workshop. Councilmember Clark asked if staff has been advising Council of any errors when each item comes before Council. Ms. Schurhammer responded yes, pointing out, only two errors have been found to date, the one with the Building Safety Department's stadium project and the other with the Fire Department's stadium project budget. Councilmember Lieberman asked how the $277,000 correction affects the budget by category, noting the components of the base budget still total $3,368,000. Ms. Schurhammer offered to get back to Councilmember Lieberman with an answer after today's workshop. 4 Engineering Department Ms. Schurhammer reported a base budget of $3,138,879 with no carryover requests and supplemental requests totaling $171,044. Councilmember Lieberman asked about the 59% drop in the supplies and contracts category. Mr. Thurman explained the reduction reflects $570,000 and $160,000 appropriated in FY03-04 for engineering review and inspection of the stadium and arena are zeroed out for FY04-05. Councilmember Lieberman asked why the CIP administration division's appropriation is declining by 79% from FY03-04 to FY04-05 when CIP projects will be approved and administered in the future. Mr. Thurman explained there was a significant reorganization in the Engineering Department. He said, while the number of FTE's remains constant, the budget has shifted from division to division to account for the new priorities. Mr. Tim Ernster, Deputy City Manager, said the chart fails to reflect the reorganization, offering to provide Councilmember Clark with the correct staffing chart. Mr. Patrick Thurman, Assistant City Engineer, explained the reduction in the overall Engineering Department budget is the result of zeroing out the arena and stadium project budgets in FY04-05. Councilmember Lieberman asked if operations and maintenance of the Bank of America Building costs $434,000 annually as indicated in the supplemental request for additional funding for B of A building maintenance. Mr. Thurman stated the current base budget totals $272,956. He explained the supplemental represents a request to reinstate funding to previous levels. Councilmember Lieberman expressed his opinion that $37,000 a month to operate and maintain the building is excessive. Mr. Ernster pointed out the supplemental is identified as a one-time funding request because staff does not yet know the ongoing amount needed for ongoing operations and maintenance expenses. He said staff would monitor the costs and expect to return to Council during next year's budget process with an adjusted figure. He noted rent revenue pays for a significant portion, if not all, of the costs associated with operations and maintenance. He offered to meet with Councilmember Lieberman at a later time to review expenditures related to the Bank of America building. Mr. Thurman noted the bondholder inspects the building and dictates certain repairs. Mr. Ed Beasley, City Manager, asked Mr. Lynch to give a historical perspective on the City's purchase of the Bank of America building as well as the City's debt service for the building. Mr. Beasley said staff would also give Council a comparison of the cost of maintaining a building of similar size and use. Mr. Jon Paladini, Interim City Attorney, suggested staff confirm that taxes, repairs, maintenance and utilities are passed through on a pro-rated basis to the tenants. Mr. Lynch stated the first and second notes would be repaid in June 2007 and by the end of 2008, respectively. He said, once the first note is repaid, rent would no longer go towards the note. He said it is his understanding that the rates per square foot tenants pay includes maintenance and common area components. Councilmember Lieberman asked about the annual lease payment on the Bank of America Building. Councilmember Lieberman also inquired about the amount of square footage occupied by City staff. Mr. Ernster offered to provide a copy of staff's monthly report, stating it will include such information. Ms. Schurhammer stated that the city is 5 scheduled to pay $960,000 in debt service payments in the current fiscal year. She said the City's debt service obligation then drops to approximately $870,000 in FY05- 06, $835,000 in FY06-07, and $304,000 by FY07-08. Councilmember Clark asked staff to provide detail on how the $434,000 for maintenance will be expended. Ms. Schurhammer clarified the $434,000 represents the base budget plus the supplemental request. Planning Department Ms. Schurhammer stated the Planning Department has a base budget of $1,495,175, no carryover requests, and a $20,000 supplemental request. Councilmember Martinez pointed out the Planning Department's FY04-05 budget is 5% below the FY03-04 budget despite constant staffing levels. Mr. Jon Froke, Planning Director, explained a couple long-term employees left and was replaced with staff that was hired at a lower point in the salary range. Transportation Ms. Schurhammer reported a base budget of $13,763,602, $112,836 in carryover requests and $579,807 in supplemental requests. Councilmember Lieberman asked how much the Dial-A-Ride program costs the city per year. Mr. Jim Book Transportation Director, confirmed the city subsidizes Dial-A-Ride to a significant degree, noting the City recovers only 10% of the cost. Councilmember Lieberman asked if any of the subsidy is covered by federal funds. Mr. Book stated, while operating costs are not federally subsidized, the City receives federal funding for buses and other capital equipment. Ms. Schurhammer offered to get back with Councilmember Lieberman on the amount the city subsidizes the Dial-A-Ride program. Councilmember Lieberman noted many of his older constituents comment on the need for more Dial-A-Ride, stating he tries to explain the expense involved in offering the service. Vice Mayor Eggleston pointed out some funding for Dial-A-Ride comes from Regional Public Transportation funds. Mr. Book agreed LTAF funds could be used for operations. Councilmember Martinez asked about the decrease in the Dial-A-Ride program's base budget for FY04-05. He also expressed concern about the long wait times associated with Dial-A-Ride and asked if the decrease in the Dial-A-Ride program's budget will further negatively impact the wait times. Mr. Book said the $73,000 decrease in the program's budget would not affect wait time. He stated that the average wait time is 45 minutes. He also stated that the program has many regular customers who are pre- scheduled and, as a result, receive regular, on-time service. He stated frustration occurs when people call and want immediate service. In response to Councilmember Martinez's question about the decline in the budget for the transportation program management division, Mr. Hoffman stated t the reduction represents reductions in internal charges to the Transportation Fund, stating there will be no service impacts. Mr. Hoffman also explained the decrease in the Dial-A-Ride program's budget, stating that it is the result of declines in replacement fund premiums. 6 Councilmember Lieberman asked about the $72,445 supplemental request for streetlight utility costs. Mr. Hoffman explained the supplemental covers the anticipated 10% t increase in utility charges as well as normal growth. Councilmember Martinez said he believes an additional $92,000 to $100,000 will be necessary to bring the neighborhood mitigation program up to speed based on the current number of requests for traffic studies related to speed humps, Mr. Book pointed out there are many components to the Neighborhood Mitigation Program and traffic studies do not always result in the installation of speed humps. He said the requested supplemental is intended to partially restore the $80,000-$90,000 the program lost as a result of previous budget cuts. . Councilmember Martinez expressed his opinion the funding should be doubled. Councilmember Lieberman noted he has neighborhood concerns about traffic mitigation that have not yet been satisfied. He stated speeding is the number one problem in neighborhoods and he agrees with Councilmember Martinez that the funding should be doubled. Councilmember Clark noted the proposed budget shows no increase for traffic mitigation. She asked why the department did not feel it was a high enough priority to redirect funding from other divisions into traffic mitigation. Mr. Book commented on the importance of all of their duties and responsibilities. He noted the department actually doubled the budget for traffic mitigation with the passage of the Go Glendale Program, however, the budget was later reduced in an effort to protect other vital components of the department that are funded solely with General Fund monies. Mr. Ernster stated many divisions within Transportation were reduced during last year's budget reductions. He said it would be difficult to find funding in other divisions to put towards traffic mitigation without harming the services in those other divisions. Councilmember Clark asked why certain divisions were found worthy of full restoration, but not traffic mitigation. Mr. Book said the traffic studies program also covers traffic mitigation issues and that division's budget increased 1% over this FY's budget. He stated his staff looked at the department as a whole, however, Council has the authority to direct staff to reassign the funds if it so desires. Councilmember Martinez said he understands the rationale for last year's budget cuts but suggests using some of the recommended excess GF contingency appropriation for FY04-05 to restore full funding to traffic mitigation. Councilmembers Clark and Lieberman agreed it should be placed on the Council's wish list for additional funding in FY04-05. Vice Mayor Eggleston said speeding in neighborhoods is a priority but he believes Council should listen to staff since they are the experts. He pointed out speed humps are not necessarily the answer to speeding in all neighborhoods. Councilmember Martinez said he respects staff, but he also has to listen to his constituents. He noted only one neighborhood has requested that its speed humps be removed since the program's inception, explaining the speed humps were removed as part of another project and residents requested they not be reinstalled. Councilmember Lieberman said their job is to ensure citizens get the services they desire. Councilmember Goulet stated individuals are not taking responsibility for speeding because they are not being ticketed. He suggested the city reinstate the education 7 portion of their speed reduction campaign. He said speed humps often shift the problem from one neighborhood to another and can impact response times for the Fire and Police Departments. Councilmember Martinez said campaigns and patrols only have an impact for a limited time, therefore, he thinks the speed hump program should be available to all neighborhoods that meet the criteria. Councilmember Lieberman commented speed humps redirect traffic to arterial streets where it belongs. He noted Glendale is the only major city in the valley that does not have radar or red light cameras at intersections. With regard to the supplemental request for $50,00 to conduct a financial analysis of the GO Program Councilmember Lieberman asked if the $50,000 is self-funded by the Go Program. Mr. Book responded yes. Public Works Administration Ms. Schurhammer reported a base budget of $235,661, with no carryover or supplemental requests for the deputy city manager of the public works group budget. Mr. Ken Reedy, Deputy City Manager, explained the increase in his budget for next FY is the result of the management assistant position added to his office. Field Operations Ms. Schurhammer stated the Field Operations base budget is $40,364,599, the carryover requests total $873,000, and supplemental requests total $2.8 million. She noted the landfill and sanitation operations are self-supporting in that the fees charged for services are expected to cover the expenses of providing the services. Councilmember Lieberman asked if the paint and body shop has been eliminated. Mr. Staurt Kent, Field Operations Director, responded no, explaining the positions and funding for fabrication and welding as well as the paint and body shop have been moved into the equipment management division. He stated the two budgets combined total $380,000 and represent the11% increase in the equipment management division's budget. Councilmember Martinez asked about the 68% decrease in the Manistee Ranch maintenance division's budget. Mr. Kent explained security service has been reduced throughout the city, noting, however, Manistee still gets security service as part of a patrol. Councilmember Martinez asked about the 18% reduction in the loose trash division's budget. Mr. Kent said the current year's budget includes one-time funding for the purchase of pieces of heavy equipment; this one-time funding is not needed in FY04-05 and therefore is not included in the FY04-05 budget. Councilmember Lieberman asked if the city eliminated its wood waste operation. Mr. Kent responded yes, noting the equipment sold for $187,000 at auction. In response to Councilmember Clark's question about the graffiti removal program, Mr. Kent explained that residential properties, not commercial properties, have been the focus of the program. This focus will change so that property type is no longer a determining factor of service. . He also said the vacant graffiti removal program's FTE was moved into Facilities Management last fiscal year, however, this position will be returned to the graffiti removal program. Councilmember Clark asked if the number of FTEs in Facilities Management will be reduced by one and Mr. Kent answered yes. 8 Councilmember Clark commented on the importance of the graffiti removal program to citizens. Councilmember Lieberman asked about the 2% reduction in the materials recovery facility's budget for FY04-05. Mr. Kent said the decrease reflects a reduction in the usage of temporary personnel. Councilmember Lieberman asked about the cost recovery rate for the facility. Mr. Kent offered to provide that number to Councilmember Lieberman at a later date. He noted, however, this has been a record year in terms of the sale of material and the price received for material. Vice Mayor Eggleston pointed out the recycling program extends the life of the landfill. Councilmember Lieberman asked if sanitation trucks rare in the vehicle replacement fund. Mr. Kent responded no, stating they typically lease purchase such vehicles. With respect to the carryover request for the purchase of sanitation trucks, Mr. Kent said four of the five vehicles are at Phoenix dealerships and he hopes to have all five delivered by June 30. The carryover requests were submitted just in case the vehicles cannot be delivered until the new fiscal year. Councilmember Lieberman asked if extended warranties are purchased for the sanitation trucks. Mr. Kent said extended warranties are purchased only on key components of the vehicles. In response to Councilmember Lieberman's question, Mr. Kent stated the $1.639 million in the Vehicle Replacement Fund supplemental is in addition to the $800,000 base budget for a total FY04-05 vehicle replacement budget of approximately $2.4 million. Utilities Ms. Schurhammer reported a base budget of $28,177,013, carryover requests of $299,758 and a supplemental request of $1 ,037,572 for the Utilities Department Councilmember Clark asked if the increase in Water Distribution FTEs and the elimination of FTE positions in Transmission Line Maintenance is the result of a reorganization of the department. Mr. Roger Bailey, Utility Director, responded yes, explaining the two groups were consolidated into one. In response to Councilmember Lieberman's question, Mr. Bailey explained the utilities information management division handles the management of the computerized systems at the treatment plants. He said the supplemental is for two additional FTEs. Councilmember Martinez asked if there is a need to replace aging equipment. Mr. Reedy stated the costs would rise over time as the system deteriorates due to naturally occurring gases. He stated the $60,000 supplemental request for equipment maintenance and refurbishment will address odor control scrubbers, manholes, and equipment at the reclamation plants. Councilmember Martinez asked about the decline of 3 FTEs in previous years. Mr. Bailey explained staff made up for the three positions by increasing the usage of overtime and standby. Mr. Reedy said the department needs to add a person to the daily operations to help mitigate the need for after-hour activities. Mayor Scruggs rejoined the meeting. 9 Environmental Resources Ms. Schurhammer stated the base budget for the Environmental Resources Department totals almost $1.8 million. She stated there are no carryover or supplemental requests. Councilmember Frate asked if staff is requesting a supplemental with regard to West Nile virus and roof rats. Mr. Doug Kukino, Environmental Resources Director, stated roof rats are the responsibility of the Community Partnership Department. He assured Councilmember Frate the FY04-05 budget for environmental resources will accommodate additional outreach to educate the public about on the West Nile virus. Community Services Administration Ms. Schurhammer reported a base budget of $236,005, with no carryover or supplemental requests for the budget of the deputy city manager of the community services group. Community Partnership Ms. Schurhammer stated the Community Partnership Department has a base budget of $432,093, no carryover requests and a supplemental request totaling $13,500. Mr. Frate asked if the budget includes money for public outreach concerning roof rats. Mr. Eric Strunk, Neighborhood Partnership Director, said community education, including Glendale University and the Homeowners Association Training Academy, is his department's responsibility. He said his department has baiting stations available should they be needed and staff is working with the Marketing Department staff, Council staff and the city manager's office to educate citizens on the issue of roof rats. He said his staff also is working with the Environmental Resources Department to educate citizens on the West Nile virus. Councilmember Clark asked if the city works with Maricopa County and the Flood Control District to spray the river channel to control mosquitoes. Mr. Strunk stated the city handles educating residents on how to prevent mosquito populations. Mr. Kukino said complaints about mosquitoes are directed to Maricopa County. Library Department Ms. Schurhammer reported a base budget of $7.9 million, no carryover requests and supplemental requests totaling $363,993 for the Library Department. Parks and Recreation Ms. Schurhammer stated the Parks and Recreation Department has a base budget of $10.3 million, with no carryover requests and supplemental requests in the amount of $230,319. Councilmember Clark pointed out there is no increase in the number of park ranger FTEs, despite new parks being brought on line. Mr. Warren Smith, Parks and Recreation Director, said some of the department's supplementals did not move forward because of the lack of available funding. He acknowledged the need for additional rangers, explaining the job descriptions for park service workers have expanded to include the responsibilities of a park ranger. Councilmember Clark asked 10 if most service workers work from 9:00 a.m. to 5:00 p.m. Mr. Smith responded yes, stating the department can then schedule the four park rangers they have for evening and weekend hours. Mayor Scruggs asked if the department has increased staffing to address the expansion of the community center and adult center. He explained the expansions would be handled using a combination of methods, including collaboration with other agencies and utilization of volunteers. Mayor Scruggs asked Mr. Smith whether he believes additional staffing would allow the centers to better serve the public. Mr. Smith responded yes. . Mayor Scruggs commented on the importance of adequately staffing the centers, stating she is going to insist staff look at privatizing new centers when they are brought on line. Mr. Smith said the department has not had to cut back the hours of operation at the centers to date but it struggles to have them staffed sufficiently. Mayor Scruggs stated the city has reduced operating hours in the past, however, and, more to the point, the city has not expanded the hours of operation. On behalf of Councilmember Martinez, Mayor Scruggs asked if the AM/PM recreation program is the same as the GRASP program. Mr. Smith responded yes, except it is a licensed program and no GF monies are used. He explained GRASP is a free service that is partiallyfundedthrough a partnership with the Glendale Elementary School District and 21 Century Learning Grants. He noted the GRASP program has been improved to allow parents the choice of letting their children leave on their own or requiring that they be signed out. Councilmember Lieberman asked if the after school programs are held exclusively in schools. Mr. Smith answered yes. In response to Vice Mayor Eggleston's question, Mr. Smith clarified the community center's hours of operation as 8:00 a.m. to 9:00 p.m., while the adult center closes at 4:30 p.m. Councilmember Frate commented many adults want the adult center to remain open later, asking how many personnel would be needed to extend the hours of operation to 7:00 p.m. Mr. Smith noted funding was provided to extend the adult center's hours of operation years ago, but $314,000 was cut from the Parks and Recreation budget last year. He estimated it would cost $43,000 to $46,000 to extend the hours to 7:00 p.m. Councilmember Frate recommended Council add extended hours of operation at the adult center to the wish list of items that should be considered for additional funding in FY04-05. Mayor Scruggs agreed, stating she often hears about the significant portion of the senior population who work and volunteer and want more access to the fitness center. Community Housing and Revitalization Ms. Schurhammer reported a base budget of $11.8 million, carryover requests totaling $2 million, and supplemental requests totaling $81,633 for the Community Housing and Revitalization Department. Councilmember Lieberman asked about the $100,000 Neighborhood Partnership carryover request. Ms. Santiago-Espino stated Neighborhood Partnership has requested the money for its programs. Councilmember Goulet asked about the $50,000 carryover request for the Habitat for Humanity infill program. Ms. Gloria Santiago-Espino, Community Housing and 11 Revitalization Director, stated the money is for the infill rebate proram, for which the boundaries now extend from Northern to Camelback, from 43`' to 67 Avenues. Civic Center Ms. Schurhammer stated the Civic Center has a base budget of $667,529, carryover requests totaling $10,925 and no supplemental requests. Councilmember Lieberman asked about Civic Center revenue. Mr. John Moses, General Manager, said the Civic Center currently has a 56% cost recovery rate with total Civic Center revenue coming in at approximately $300,000. Revised Balancing Detail Ms. Schurhammer reviewed the revised balancing information for ongoing GF revenue and expenditures for FY04-05 and compared the numbers to those shown to Council at the March 16 budget workshop. The bottom line for the "ongoing revenue surplus" figure shows that it has increased from $321,00 to $597,000 - $672,000. She said total GF revenue shows a decline of about $133,000 due to the shift of the primary property tax revenue attributable to appreciation of existing building stock to the secondary property tax side. She said total General Fund expenses remain unchanged. She stated the cost of the benefits supplemental would decrease from $800,000 to either $375,000 or $450,000, depending on the option Council chooses. She said an adjustment to a Field Operations Department supplemental resulted in $58,000 being added back to the ongoing GF revenue side. Mayor Scruggs asked when Council would be asked to decide on which benefits option to select and Ms. Schurhammer answered April 20. Councilmember Clark noted they could also decide to use a portion or all of the recommended excess GF contingency appropriation. Ms. Schurhammer agreed, emphasizing, however, that the excess GF contingency represents one-time funding, not ongoing funding. Ms. Schurhammer noted Council asked her to reduce the total General Fund revenue projection for state-shared revenues by $1.9 million so that it would be held constant with the FY03-04 revenue budget for state-shared revenues. Mayor Scruggs clarified Council directed staff not to include an increase in state-shared revenues because adding the $1.9 million into the ongoing budget would result in ongoing expenses that the city may not be able to fund in two years when the city is expected to lose $3.6 million in state-shared revenue as a result of the mid-decade census. Councilmember Lieberman asked if the Arizona League of Cities and Towns estimates Glendale will receive $1.6 million more than the city projected for state-shared revenue. Ms. Schurhammer responded no, explaining staff originally estimated state-shared revenue, which includes state sales tax; state income tax and motor vehicle in-lieu revenues would increase by $1.9 million over the FY03-04 revenue budget for these sources. The League estimated state sales tax; state income tax and HURF revenues will increase $1.6 million over the FY03-04 revenue budget for these sources. She emphasized the League's estimate was not included in the General Fund revenue projection for FY04-05. 12 Mayor Scruggs clarified state-shared revenue is determined by formula and divided among the communities based on each community's population. She said other west valley cities have experienced a high level of growth, therefore, they will claim a larger share of the money once the census is conducted in 2005. In response to Councilmember Lieberman's question, Ms. Schurhammer clarified the League projected the City of Glendale will collect $1.6 million more state sales tax, state income tax and HURF revenues will increase $1.6 million over the FY03-04 revenue budget for these sources. She said State Shared Revenue currently represents $45.1M, or over one-third of the city's total GF revenue for FY04-05. Vice Mayor Eggleston asked Ms. Schurhammer about the $75,000 difference between the two benefits options. Ms. Pam Kavanaugh, Assistant City Manager, offered to provide a memo to Council explaining the differences prior to the April 20 meeting. Ms. Schurhammer then reviewed the revised balancing detail for one-time GF revenue, stating the surplus has increased from $181,000 at the March 16 meeting to $767,000. She explained the one-time GF transfer for the stadium declined from $829,000 to $336,000. She said the Community Facilities District (CFD) is expected to cover the $336,000 transfer, but it is shown as a transfer from the GF just in case the CFD does not cover it. She said the minimum GF contingency appropriation was reduced from $13,622,000 to $13,609,000 as a result of the slight decline in projected GF revenue for FY04-05. She said and the recommended additional GF contingency appropriation was reduced from $3,550,000 to $2,550,000 to allow $1 million to be set-aside for the Super Bowl. She said an $80,000 adjustment was also made to a one-time Finance Department supplemental, explaining the request was accommodated through other means. Ms. Schurhammer stated the final budget balancing meeting will be held April 20, at which time staff will ask Council to make its decision with regard to the supplementals it wants to fund. She said Council would also be asked to make decisions on wish list items discussed during previous workshops, noting she will add the adult center to that list. Finally, decisions about the recommended capital improvement program will be required at the April 20th workshop. Councilmember Clark asked Ms. Schurhammer to specify which of the wish list items represent one-time versus ongoing expenses when they return on April 20. Ms. Schurhammer confirmed for Mayor Scruggs that one-time money could be so supplement funding for the economic opportunities program. If this were done, then the additional funding would lapse in FY05-06. Mayor Scruggs noted some of the items on the wish list could be viewed as one-time expenses, while others can only be added as ongoing expenses. Councilmember Frate asked Mr. Lynch why staff originally recommended a $17 million GF contingency appropriation and what has changed to justify reducing staff's recommendation to $13.6 million, which is the minimum amount necessary. Mr. Lynch explained staffs recommendation was to begin building the fund balance to strengthen the city's overall financial picture for rating agencies. Councilmember Frate asked Mr. Lynch if he is comfortable with a 10% contingency appropriation. Mr. Lynch said the 13 faster the city builds its GF contingency appropriation, the faster it grows the GF fund balance, the better off they will be as a city. Councilmember Lieberman asked about Grand Avenue Marketing. Ms. Schurhammer stated a $50,000 GF supplemental as well as $357,000 in Transportation Sales Tax money is set aside for Grand Avenue marketing in FY04-05. Councilmember Lieberman noted CTOC agreed to $357,000 for Grand Avenue marketing. Ms. Frisoni explained this item could be removed from council's wish list since CTOC approved the $357,000 funding request. She believed the item was on Council's wish list only if CTOC did not approve the $357,000 funding request. Vice Mayor Eggleston pointed out the signage will help everyone who drives in the area, not just the merchants. Ms. Frisoni agreed, explaining the CTOC proposal was a joint proposal between Marketing and Transportation and includes a public education component and signage. Councilmember Clark asked Mr. Lynch why he did not recommend a higher percentage for the minimum GF contingency appropriation. She also asked what percentage is necessary to achieve a positive impact on the city's bond rating. Mr. Lynch said staff originally recommended a higher amount. He explained 10% is the minimum amount recommended under various accounting requirements, noting most cities of similar size have sizably larger fund balances. He said there is no target percentage that will guarantee a higher bond rating, but he believes building the fund balance should translate into bond rating increases. Mr. Lynch confirmed for Councilmember Clark that staff is recommending the city work towards achieving a $50 million GF contingency appropriation. Councilmember Clark asked to see the unappropriated fund balances for other cities in the metro area. Mayor Scruggs asked staff to compile a list of the amounts of unappropriated fund balances that were actually used each year. Councilmember Clark suggested they develop a program that increases the percentage gradually over the next 10 to 15 years. Vice Mayor Eggleston commented the minimum GF contingency appropriation of $13.6 million plus an additional GF contingency appropriation of $2.5 million results in a total Contingency of $16.1 million. ADJOURNMENT The meeting was adjourned at 11:45 a.m. 14