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Home My WebLink About05-14-2012 Regular Meeting.. Public Meeting Notice Committee: Fairhope Financial Advisory Committee Date & Time: Monday, May 14, 2012 at 4:45 p.m. Place: Delchamps Room 161 North Section Street Subject: See Attached Agenda Notice must be sta1nped, dated and initialed before posted on bulletin board. POSTED 5-tl1-/q ~= DAT~ ~ {/ tiotmOALL4V SIGNATURE City of Fairhope Financial Advisory Committee SPECIAL MEETING Agenda -Monday, May 14, 2012 4:45 p.m. in Delchamps Room at City Hall City Hall -161 N. Section St., Fairhope, AL 1. Discussion and recommendations from Mayor and staff of action plans to resolve the FY2012 budget shortfa ll s projected at the 4/23 /2012 FAC meeting. 2. Additional discussion and recommendations from F AC members. 3. Recommendation(s) to City Council. 4. Discussion and recommendations from Mayor and staff of action plans to manage the funding gaps for water and was te water projects projected at the 4/23 /2012 F AC meeting. 5. Additional di scussion and recommendations from FAC members. 6. Recommendation(s) to City Council. Schedule Of Future Meetings (Note: Regular meetings are on the 4th Monday of each month at 4:45 p.m. in the Delchamps Room at City Hall, 161 N. Section St., Fairhope, AL.) • Next regular meeting: Tuesday, M ay 29 , 2012 STATE OF ALABAMA COUNTY OF BALDWIN )( )( The Financial Advisory Committee met at 4:45 p.m., City Hall, Delchamps Room, 161 North Section Street, Fairhope, Alabama 36532 , on Monday, 14 May 20 12 . Present were: Chuck Zunk, Chairman Members: Stan Grubin, Mac McCawley, Marvin Wilder, John Brown, and Bob Riggs , and Mayor Kant. Ex-Officio Members: Debbie Quinn , Dan Stankoski, Lonnie Mixon, Mike Ford , and Ri ck Kingrea. Chuck Zunk called the meetin g to order at 4:45 p.m. He announced that the first item is the discussion and recommendation from Mayor and staff of action plans to resolve the FY2012 budget shortfalls projected at the April 23, 2012 Financial Advisory Committee meeting. Mayor Kant stated that the General Fund would be short approximately $700,000 with budget cuts of $200 ,000. He suggested increasing transfers from the Electric and Gas Reserves for the shortfalls or using money from the Rainy Day Fund for a few months. Chuck Zunk summarized the three suggestions from Mayor Kant to the Committee: curtail spending, increase transfers from Gas and E lectric , and using money from Rainy Day Fund by haltin g for several months (a diversion of funds). All members agreed with the recommendation to allow transfers from the Gas and Electric Funds temporarily and not start a trend ; keep spending down ; take caution in what we are doing; and do not use the Rainy Day Fund. After further discussion , Lonnie Mixon moved to recommend to the City Council to allow an increase in the perc e ntage of transfers from the Electric and Gas Funds as needed for shortfall s temporarily through this Fiscal Year; and that the Ci ty Treasurer wi ll give a report to the Ci ty Council at the second meeting of each month. Seconded by Stan Grubin, motion passed unanimously by voice vote . Stan Grubin and Mac Mccawley mention ed the bond monies and how much the City was in debt. Nancy Wilson commented the only bond outstanding is the 2007 and we refinanced the others in 2011. Chuck Zunk said the debt picture has not changed and in 2007 was a new debt for the Airport . Mayor Kant stated we cannot borrow more than $18,000,000 unless the Council raises the debt limit. Financial Advisory Committee Monday, 14 May 2012 Page -2- Mayor Kant discussed and recommended action plans to manage the funding gaps for water and waste water projects projected at the April 23, 2012 Financial Advisory Committee meeting. He said we need to move forward on the upgrades at the waste water plant, paint the water towers , and prepare an RFP for the waterline to Rock Creek. Chuck Zunk agreed with Mayor Kant to finali z e with Volkert and prepare an RFP for an engineering firm for the waterline to Rock Creek. Steve Seay recommended adding the gas lines to be included with Rock Creek. Gregg Mims commented that the RFP for the waterline to Rock Creek did not have to go before the City Council and staff would handle it. Marvin Wilder moved to adjourn the meeting. Seconded by Mac McCawley, motion passed unanimously by voice vote. There being no further business to come before the Financial Advisory Committee, the meeting was duly adjourned at 5 :36 p .m. Chuck Zunk, Chairman OPERATING EARNINGS PROJECTIONS/TRANSFERS UTILITIES FISCAL YEAR 2012 BUDGET -PROJECTED -BUDGETED PROJECTED EARNINGS EARNINGS TRANSFER TRANSF ER BUDGETED % GAS FUND 2 ,396 ,829 1 ,792 ,063 1 ,307 ,5 7 3 977 ,647 54 .55 % ELECTRIC FUND 3 ,890 ,199 3 ,025 ,949 2 ,122 ,270 1 ,650 ,785 54 .55 % WATER FUND 2 ,946,210 2 ,781 ,958 1 ,473 ,105 1 ,390 ,979 50.00 % 9 ,233 ,238 7 ,599 ,970 4 ,902 ,948 4 ,019 ,411 PROJECTED TRANSFERS SHORT OF BUDGET 883,537 NET EARNINGS ALTERNATIVE OPT T ION OPT ION % AFTE R TRANSF E RS GAS FUND 2 ,396 ,829 1 ,792 ,063 1 ,307 ,573 1 ,062 ,573 59 .29 % 729 ,490 ELECTRIC FUND 3 ,890 ,199 3 ,025 ,949 2 ,122 ,270 1 ,877 ,270 62 .04 % 1 ,148 ,679 WATER FUND 2 ,946 ,210 2 ,781,958 1 ,473 ,105 1 ,473 ,105 52 .95 % 1 ,308,853 9 ,233,2 38 7 ,599 ,970 4 ,902 ,948 4 ,412 ,948 EXPENSES General Fund REVENUES AND EXPENSES GOVERNMENT FUNDS FISCAL YEAR 2012 Budgeted 6,756,106 Projected - after suggested cuts 6,655,236 Suggested Cuts % Cut 234,871 3.48 % Police Department 5,213,334 5,201,856 79,478 1.52 % Projected amount includes $68,000 over budget for DEA fund expenditures offset by over budget DEA collections. Fire Department 472,679 465,473 7,206 1. 52 % Recreation Department 1,239,012 1,175,123 63,889 5.16 % Special Services 902,130 888,377 13,753 1. 52 % Street Department 2,301,570 2,266,482 35,088 1. 52 % Sanitation Department 1,888,562 1,859,771 28,791 1. 52 % Golf Operations 1,101,685 1,084,890 16,795 1. 52 % Staff Agencies 970,124 970,124 0.00 % Debt Services 1,961,230 5,684,595 0.00 % Other Expenditures 90,000 128,779 0.00 % 22,896,432 26,380,706 479,871 OPTION 1 TOTAL REVENUES TRANSFERS FROM UTILITIES TOTAL REVENUES AND TRANSFERS TOTAL EXPENSES EXCESS REVENUES OVER EXPENSES SUGGESTED CUTS REVENUES AND EXPENSES GOVERNMENT FUNDS FISCAL YEAR 2012 EXCESS REVENUE OVER EXPENSES AFTER CUTS TRNSFERS TO SALES TAX RESERVES Budgeted 20 ,418,862 4,902,949 25,321,811 (22 ,896,432) 2 ,425 ,379 2 ,425 ,379 (2 ,375 ,000) 50 ,379 Projected 24 ,394 ,639 4,019,411 28 ,414,050 (26,860 ,577) 1,553 ,473 479 ,871 2 ,033 ,344 (2 ,361 ,801) (328 ,457) OPTION 2 TOTAL REVENUES TRANSFERS FROM UTILITIES TOTAL REVENUES AND TRANSFERS EXPENSES EXCESS REVENUES OVER EXPENSES TRANSFERS TO SALES TAX RESERVES REVENUES AND EXPENSES GOVERNMENT FUNDS FISCAL YEAR 2012 Budgeted Projected 20,418,862 24,337,868 4,902,949 * 4,412,948 25,321,811 28,750,816 (22,896,432) (26,860,577) 2,425,379 2,370,110 (2,375,000) (2,361,801) 50,379 8,309 C 1 ,y o~ /4 r~ l+o l't:,- Lo ,,J & !En./'-'/ µ €8 1 fi~ C t:: fl ~ p P -·r:.> /_o"' C Tc (</'1 9/ '?>o ."b <f e, r, p,J ty I _:ft ! 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