Agenda Packets - 2016/06/06 - Laserfiche WebLink

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The employer’s share of PERA will remain at 7.50% for General (non-police officer) plan members, the PERA General rate has increased from 5.53% in 2005 to 7.50% in 2015. The Police plan will remain at 16.2% the police PERA rate has increased from 9.3% in 2005 to 16.2% in 2015. Current PERA pensions are funded at 78.19% for General Employees Retirement Fund and 86.61% for Police and Fire Retirement Fund. A liability has been recognized in the entity- wide financial statements, (General $1,684,318, Police 1,783,887) as a result of implementing GASB Statement 68. The state legislature controls the resolution of the underfunded pensions. The payroll cost for 50 FT 10 seasonal employees is $2,495 per hour, $19,960 per day, $99,800 per 40 hour week and $5,190,242 per year. W ork comp will decrease by $8,098 due to an estimated change in our experience mod from 1.38 to 1.25. Overall, pay and benefit costs will increase by approximately $160,310 across all funds and $128,384 for the General Fund. County dispatch fees will increase by a minimal amount, 2017 proposed fees will increase $705 or 0.6%, 2016 fees decreased $3,393 or 3.01% to $106,426. Fire department costs will increase by about 3-5% in 2017, our share will depend on the cost sharing formula. Capital costs should be stable, excluding consideration of a new ladder truck. (2017 – 15.819%, 2016 – 16.099%) Information technology costs will increase by $6,500 to $83,000 for 2016 due to additional network, software license, and desktop support staff costs. This continues to be an excellent value for the City. Fuel prices were budgeted at $2.75 for 2016, staff would recommend using $2.30 for 2017. Overall most revenues that are tied to economic activity will be flat to improving. Investment income will remain flat to increasing in 2017 as a result of Federal Reserve activities and the weak economic recovery. The franchise fee rate is at 4.00%, the revenue is split between the General fund and the Street Improvement fund. The revenue generated from this fee will be dependent on commodity prices and economic activity in 2017 but should be consistent with 2016. 2015 General Fund unassigned fund balance is $3,448,111 this represents 52.70% of 2016 budgeted expenditures and transfers. The General Fund also has Assigned fund balance for Levy Reduction of $5,826,995, and $339,307 to balance the subsequent budget. It has been the Council’s policy to draw down the levy reduction funds over time. One of the City’s goals is to develop a sustainable budget. The General Fund deficit will be $325,000 to $375,000 this will be partially offset by the drawdown of assigned (levy reduction) funds of $250,000. This will leave a deficit of approximately $75,000 to $125,000 before considering any expenditure reductions or a levy increase. Conclusion Staff is looking for direction from the Council on priorities for the budget and property tax levy. The above items are some of the issues that will drive the 2017 budget and are presented for your consideration. Respectfully Submitted, Mark Beer