Review and discussion of proposed FY 2014/15 Budget

Major Street Fund

The Act 51 monies are a state allocation through the federal government.  A formula is utilized, based on the number of major miles. There are 15.25 miles of major streets.  The city receives $290,000 in Act 51 monies.  

The salary numbers are higher, as they had been putting the burden on water and sewer to pay salaries.  They tried to be more reflective of what they are expending in the salaries for streets.  It is not 100% reflective, but that is the direction they will go.

Regarding snow removal supplies, all of the salt was used.  The city secures MIDEAL pricing on the salt at a discounted rate per ton.  They don’t want to run out and have to go to the free market for salt. 

Building maintenance is for DPW facilities. 

Mayor Gunderson expressed a concern about all the sand in the catch basins. 

City Manager Mullendore stated they would have ample resources for basin cleaning. 

Tree City USA – the allocation for the per capita requirement is in Major Street. 

Council Member Jones stated two or three years ago new trees were put underneath the power lines.  Ornamentals should be used in areas with power lines.    

Street striping through the county program can go another year.

They are working to change the motor pool to an equipment fund.    

S. Bridge Street, from State Street to the city limits has a budget of $200,000 for that project.  There is concrete underneath the asphalt.  The allocation is $375,000 from the Small Urban Program.  Section 1 and Section 2 of the project will be done in two budget cycles, but the work will be done concurrently.  Advance construct will be done and the city will be reimbursed when the State starts their fiscal year in October. 

Council Member Jones asked if sidewalks or pathways would be done?

City Manager Mullendore stated they may just do sidewalk on one side of the road.  Curb and gutter will be a part of the project. 

Snowblades are funded out of the same fund as the salt. 

Local Streets

Less money is received for local streets, as they are not primary and are less travelled.  They do not have to meet MDOT specifications on local streets, as required on major streets.

$96,000 in revenue is received from Act 51. 

Local streets have a significant reliance on the General Fund.  $30,000 is transferred from CIP.   The salaries are reflective of reality. 

Uniforms - the collective bargaining agreements with the unions have a uniform allowance.  By MIOSHA standards, DPW has to wear steel toed boots.  It is a matter of equality among employees, as the police get boots and equipment covered. 

Council Member Jones asked if they should use part time staff to help that can get their CDL?

Finance Director Andres stated overtime is used for water breaks and plowing.    

City Manager Mullendore stated they plan to spend $60,000 on asphalt laying.  Funds may be transferred from Major Streets to Local Streets to make fund balance look better.  They will know more at year end.    

Electrolux Property

There is funding, but no maintenance allocated.  As long as the fence is there, Electrolux will do the maintenance.  If the fence comes down, a budget amendment will be done when the city assumes the maintenance of the property.  Electrolux maintenance staff does communicate with Ernie

DDA

DDA merges money with the local jurisdiction. 

Contractual services will cover the redistricting of boundaries and development plan.  With redistricting, the DDA will begin to have a capture. 

The governing body approves the DDA budget. 

Building Inspection

There will be changes with this.  She has been talking to City of Ionia regarding who they utilize. The City of Ionia and County of Ionia utilize a firm.  Our building inspector has no office hours.  They heard he may resign, so they would engage a firm for mechanical, electrical and plumbing with established office hours.  The details must be worked out. 

Drug Forfeiture

Revenue was not allocated.  They have not had any big assets from drug crimes that could be sold.  There is an expenditure for enforcement. 

Council Member Lallo stated they should step up their efforts if they can. 

Library

The city if the custodian of the budget, but it is not a city budget.  They have a balanced budget and are not touching their fund balance.  They would like a contribution from the Friends for $1,000 for movies.

Museum Fund

Building repair and maintenance – there is a leak in the roof.  The city will pay for the stairways and sidewalk going out.  The city will have to get a permit from the Historic District Commission. 

Debt Service Funds

Fund 302, TIFA payment – this is the last year of the payment for Ellis and Crawford Streets.

State Revolving Fund (SRF) covered sewer infrastructure work, with the last payment in 2028. 

Building Authority Debt Fund – this was a $950,000 bond issue for the parks with a payoff in 2021.  The money to pay the bond comes from General Fund.

Capital Improvements Bond (CIB) – a $999,000 bond with the final payment in 2028. 

Library Debt – anything applied above the payment amount will reduce the debt.  With a USDA loan, they can only loan to a municipal entity.  If the county millage does not go through in 2017, the library will lose that funding and the city will be responsible for the debt as the recipient of the loan. It will be very important to support that millage.

Mayor Gunderson stated they are already visiting the townships regarding the millage vote.    

Capital Improvement Plan

The council dedicated two mills to the Capital Improvements Fund, which generates $162,000 from taxes.  PILOT is the payment in lieu of taxes.  The projects covered under the plan were described and discussed. 

Council Member Jones would like the city to tear the boards out of the landscape area on Main Street between the Library and Ashfield Street.  The gardeneers have removed the flowers and the flower beds look terrible.

The Chamber of Commerce is doing an Adopt-A-Bed program to maintain and weed the landscaping in the mall parking lot.  Craig Crebessa will do on-site training and recommend low maintenance vegetation.  The program will not cost the city anything.  The ornamental pieces will stay, but there will be different kinds of blooming flowers.  Each group will have a placard.  It is a way to advertise and give back to the community.  Individuals interested in maintaining an area would approach the chamber. 

City Manager Mullendore suggested that Jerry should talk to Patty Donovan from the Chamber about the Christmas decorations.

CIP Fund

The CIP Plan is a six year living document.  City Manager Mullendore described the proposed projects.  $10,000 will be moved from Update Master Plan to Local Streets. 

There will be a $25,000 allocation for city hall for Individual AC Units (mini splits).  That project could be bid out.  All units need their own breaker and service. 

Council Member Jones stated to go to more efficient lighting in the city, the cost can be offset through energy programs.

Finance Director Andres stated the city had complete units installed for new, high efficiency lights.  

Council Member Jones stated they could have someone come in to evaluate and make an estimate.  It may even apply to the heating and ventilation units.   

General TIFA Fund

Funds are received and transferred to the TIFA Fund.

Dial a Ride

676.101 – the transfer will go from $80,000 to $30,000.  There will be a reorganization.  60% to 70% of Keven’s job is dispatching.  There will be a vacancy for Becky’s spot.  Keven is being moved into Becky’s position for 65% of his time, and 35% for Dial-A-Ride.  They want to eliminate Saturday service, as it is used for leisure and is very minimal.  It would save just under $2,000 in dispatcher wages and just under $3,000 in driver wages.  They are only open five hours with one bus.  It is not an essential function on Saturday.  By eliminating that, it would be a significant savings.  The reduction in the number of busses running in the summer will save $3,325.  There are no school kids.  By moving Keven and the elimination of Saturday service, they could have a net savings of $40,000.  There would be no General Fund transfer.  Keven would do the DART program management at city hall.  She will send out the corrected budget numbers reflecting this change in the update. 

Council members wish to see the numbers on the changes before making a decision on eliminating Saturday service.     

Sewer Fund

The city is not charging enough for what the cost is for the services.  10% of water and sewer fees should be set aside for capital improvements and that is not being done.  There is a deficit of over $300,000.  The revenues are not covering operational costs.  The bond payments are almost $200,000 alone.

The reliance on paying DPW is quite heavy here even though they are increasing other funds. 

Pitsch wanted to tap into the city system, but that will not be done.  A lateral will not be run for them and they cannot connect to existing city lines. 

The expenditures exceed revenues by $308,000.  The city is not charging enough to deal with solid waste and is putting nothing aside for capital improvements.  A full rate analysis is needed. 

Council Member Jones stated they should have a rate comparison to other cities.

Water Fund

There is a $200,000 difference in expenditures over revenues. 

Council Member Jones said when a house ownership transfers, they should hook up to water and sewer services.  Pass an ordinance.  In Kent County, they have to be upgraded.

City Manager Mullendore will check on it.

City Manager Mullendore stated there should be a rate analysis done.

Internal Service Funds

City Manager Mullendore stated other funds transfer to 606 – Internal Service Funds to cover the overhead costs of the various departments.  It would involve general legal services, computer services of BS&A, Fund Balance, repair and replacement of computers. 

Building and Grounds

City Manager Mullendore stated expenditures are relative to city hall, Belrockton and the depot.

Motor Pool

There has been a reduction in the revenues.  The contributions from other departments have been lessened, to positively impact other departments. 

Health Insurance

Retirees premiums come in and are paid out for health insurance.

Cemeteries       

City Manager Mullendore stated they are thinking about an investment that would get a greater return to go into cemetery revenue. 

Adjournment

Council Member Scheid moved to adjourn the meeting, supported by Council Member Lallo.

Ayes:               Council Members Feuerstein, Scheid, Lallo, Jones and Gunderson.

            Nays:               None.

The Mayor adjourned the meeting at 10:19 p.m.