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2013 BudgetCITY OF HOPKINS MEMORANDUM Date: August 9, 2012 To: Mayor & City Council From: Christine Harkess, Finance Director Subject: 2013 Budget FINANCE DEPARTMENT Staff has been working to put together a 2013 budget based on the needs of the community and the services they have come to expect. The 2013 budget is prepared with the transfer of dispatch to Hennepin County that takes effect later this month, a 2% salary increase that was approved as part of the 3 -year union/bargaining contracts that cover 2012-2014. Those contracts call for a 0% increase in 2012, a 2% increase in 2013 and a 2% Jan -1% July in 2014. 2013 Budget Info • The budget as it is currently presented is a 1.26% increase over 2012. • If dispatch were still part of the City budget the increase would be 4.42% over 2012. • The 2013 budget is a $332,887 savings over what it would be had we maintained dispatch. • Tax Levy o The tax levy currently shows a 1.62% increase, all of it due to the General Fund. o The 2012 Street debt service levy is offset by the increase in franchise fees. o The Equipment Certificates debt levy is offset by equipment charges. o There is no increase in the levy as a result of adding debt levies of $231,107 The following page sets lists budget items that impacted the 2013 budget. Attached are the following: 1. 2013 Budget — items impacting the budget 2. 2013 Budget with and without Dispatch 3. 2013 General Fund Budget compared to 2012 4. 2013 Preliminary Tax Levy and a history of the tax levy from 2010 — 2012 Items that impact the 2013 budget Revenues • Increased miscellaneous taxes resulting from payments and rents in lieu of taxes by $15,000 to reflect revenue trend. • Decreased interest earnings to reflect revenue trend. • Municipal Building — Hennepin County has ended the satellite lease on city hall resulting in a $2,500 decreased in revenue. • City Clerk — in local election years the school district shares in elections costs. Revenue of $5,000 is budgeted. • Inspections — permit revenue was increased $22,680 due to economic trends. • Police — E-911 revenue of $24,860 will be transferred to Hennepin County along with dispatch. Court fees have been increasing and once prosecution costs are covered the remaining revenue goes to offset police expense. • Fire — reduction of $67,000 as school inspections are only done every three years. • Public Works — state aid was increased by $5,000 as our maintenance allotment has increased. Expenditures • General o 2% salary increases budgeted. This is pursuant to year 2 of the approved bargaining agreements. o No increase in employer contribution to health care ■ Health care changes are due to employees opting in or out and changing coverage between options such as: single, single + spouse, single + children or family o In 2012 if you recall we reduced the Police personnel salaries for the two officers who were on military duty. Those officers are back and the salaries budgeted for those positions resulted in a budget increase of $132,501 with no changes in the number of officers. • Administration — reallocation of one employee's time from 95% Admin/5% Fire to all admin. Changes in health insurance options. • Finance — Audit costs, software maintenance costs and the OPEB actuarial contracts all increased for 2013. • Legal — costs were increased by $7,000 to align the budget with actual. • Municipal building has requested $7,000 in PT summer help. • Receptionist — employee step increases • Assessing — Hennepin County assessing contract increased by $2,000. • City Clerk — adjusted budget to account for a local election in 2013. • Inspections — staffing was re -allocated among the Inspections Departments resulting in personnel changes between departments. Changes in health insurance options. • Police o Admin — added radio contract and CDJN fee to admin — formerly part of dispatch o Patrol — added back full salaries and benefits for one officer on military duty (at 95% - 5% to SWAT). Added two PSO's at a cost of $136,557 o SWAT Team — one officer added to this department. In 2012 two police officers time was reduced for military duty (allocated at 5% each to this dept.). o Reserves — sergeant's time allocation reduced by 50%. o Investigations — one office on military duty (allocated at 95%), in 2012 there were 4 officers assigned to investigations and in 2013 there are 5. Also in 2013 more 8/9/2012 Page 2 experienced officers were assigned to investigations resulting in higher payroll for this department. o Metro Drug Task Force — step increase and health insurance election changes o Outreach — we will be picking up approximately $22,000 in JCPP costs formerly covered by Hennepin County. o Support Services — adding two night clerks at an estimated cost of $56,700. There may be some budget savings with the vacant support services position currently open. • Fire o Added Global connect contract, Hennepin County contract for radio's and MDT's o Several line items adjusted to reflect actual expenditure history. Public Works o Administration — salary increases and health insurance election changes. o Streets & Alley's — PT increased by $7,500, increased vehicle parts by $5,000 to reflect expenditure history, increased street supplies by $10,000 to allow for in- house paving of the trails at Valley & Central Parks. o Snow Removal — decreased supplies by $5,000 as less salt is required due to more efficient salt spreading equipment and we have a surplus remaining from 2012. Worker's comp premiums for this department decreased by $6,000 as there were less salaries coded to this department. o Parks — increased contractual services by $2,000 for turf management contract of athletic fields and $11,000 light upgrade at Valley Park rink. Motor fuels increased by $4,000 to more accurately reflect usage and increased parts & supplies by $2,000 to fertilize Excelsior Blvd corridor and for irrigation upgrades at parks. o Forestry — two employees were promoted from Maintenance Worker II to III. • Recreation — Joint recreation was increased by $3,000. o Joint Rec continues to provide $15,000 in support to the Depot. • Activity Center — Increased professional services by $10,000 for programming, reduced heating costs by $2,000 and reduced other areas slightly. Net dept. increase is $4,890. • Planning & Zoning — small changes across several line items • Community Development — employee step increases and other small changes • Contingency was reduced by $40,000. A higher level was set for 2012 as several employee contracts were not settled before the budget was approved. We have three year contracts in place and that level of contingency is not needed. Finally, included below are employee statistics that may be of interest to you. Since 2002 we have less employees working fewer hours doing the same amount of work. As a result of the various economic challenges cities have faced over the years we have become leaner and more efficient as technology has changed the way we work. Interestingly, part time hours have not increased during this time. 8/9/2012 Page 3 2002 2011 Number of Employees 114 106 In 2013 we will be down to 102 Hours Worked Full Time 202,117 179,117 Part Time 21,093 19,952 Total Hours Worked 224,004 199,069 (24,935 hours less than 10 years ago) 8/9/2012 Page 3 GENERAL FUND BUDGET CMPARISION OF 2013 BUDGET WITH AND WITHOUT DISPATCH Legal 135,000 NO Dispatch Dispatch 2013 Budget Difference 68,967 68,967 - 178,860 2012 Department Budget City Council 68,697 Administrative Services 254,988 - Administration 171,090 Personnel 44,405 Wellness 2,000 Information Services 251,637 Total Administrative Services 469,132 Finance 91,358 Budget 26,249 Debt Management - General Accounting 133,402 Payroll 45,075 TIF Administration - Utility Billing 5,000 Total Finance 209,726 Legal 135,000 NO Dispatch Dispatch 2013 Budget Difference 68,967 68,967 - 178,860 178,860 - 46,768 46,768 - 2,000 2,000 - 254,988 254,988 - 482,616 482,616 - 26,388 26,388 - 137,199 137,199 - 45,609 45,609 - 5,000 5,000 - 214,196 214,196 - 142,000 142,000 - Municipal Building 296,863 313,998 313,998 Receptionist 44,846 47,048 47,048 Assessing 173,091 City Clerk 33,088 City Clerk 16,822 Records Management 32,273 Elections 60,875 Total City Clerk 109,970 Inspections 628,417 - Building Code Inspections 268,598 Fire Inspections 34,494 Heating & Plumbing Inspections 91,358 Housing Inspections 135,597 Restaurant & Hotel Inspections 1,160 Misc. Community Inspections 79,260 Vacant Property Management 2,700 Total Inspections 613,167 Police 65,855 Police Administration 486,499 Patrol 2,466,299 SWAT Team 58,906 Reserves 24,467 Investigations 430,357 Metro Drug Task Force 105,292 Pawn Shop 3,493 Outreach 84,036 Communications (Dispatch) 553,145 Support Services (Records) 252,356 Systems Management 65,182 Total Police 4,530,032 177,187 177,187 18,694 18,694 33,088 33,088 45,582 45,582 97,364 97,364 261,854 261,854 - 35,155 35,155 - 88,952 88,952 - 158,882 158,882 - 78,908 78,908 - 4,666 4,666 - 628,417 628,417 - 527,437 527,437 - 2,653,370 2,515,995 (137,375) 73,611 73,611 - 15,959 15,959 - 615,083 615,083 - 114,468 114,468 - 3,537 3,537 - 107,332 107,332 - - 527,022 527,022 310,813 254,053 (56,760) 65,855 65,855 - 4,487,465 4,820,352 332,887 NO Dispatch Dispatch 2012 Department Budget 2013 Budget Difference Fire Fire Department 851,559 920,261 920,261 - Emergency Preparedness 3,865 4,030 4,030 - Total Fire 855,424 924,291 924,291 - Public Works PW Building 32,739 34,988 34,988 - Equipment Services 86,229 85,096 85,096 - Administration 27,442 38,345 38,345 - Engineering 132,267 132,003 132,003 - Street & Alleys 859,205 888,724 888,724 - Snow & Ice Removal 197,550 187,160 187,160 - Parks 652,465 679,471 679,471 - Forrestry 210,780 233,774 233,774 - Total Public Works 2,198,677 2,279,561 2,279,561 - Recreation Playground 21,034 21,417 21,417 - Ice Rink 12,192 13,113 13,113 - Park Service 12,810 12,454 12,454 - Joint Recreation 152,000 155,000 155,000 - Skate Park 7,063 7,165 7,165 - Total Recreation 205,099 209,149 209,149 - Activity Center Act Ctr - Community Use 264,914 270,180 270,180 - Act Ctr - Maintenance 58,851 58,475 58,475 - Total Activity Center 323,765 328,655 328,655 - Planning & Zoning 126,837 129,683 129,683 - Community Development 85,999 88,926 88,926 - Tuition Reimbursement 10,200 10,200 10,200 - Contingency 90,000 50,000 50,000 - Total Expenditures 10,546,525 10,679,723 11,012,610 332,887 Other Financing Uses Transfers Out 10,000 10,000 10,000 - Total Other Financing Uses 10,000 10,000 10,000 - Grand Total Expenditures 10,556,525 10,689,723 11,022,610 332,887 Increase from 2012 - NO Dispatch 133,198 1.26% Increase from 2012 - WITH Dispatch 466,085 4.42% Budget Savings in 2013 with NO Dispatch 332,887 CITY OF HOPKINS ANALYSIS OF GENERAL FUND REVENUE BUDGET Increase Finance 400 Current Services 5,750 5,750 - 449 Miscellaneous 4,800 4,800 - Total Finance 10,550 10,550 3601 Legal - Court Fines 115,000 115,000 Municipal Building 380 Rent 2,500 - (2,500) 449 Other Miscellaneous - - - Total Municipal Building 2,500 - (2,500) -100.00% 400 Assessin - Charges for Service 1,200 1,500 300 25.00% City Clerk - (Decrease) Penalties 2012 2013 from % Department Budget Budget 2012 Budget Incr/(Decr) Unallocated - - 400 Property Taxes - levy 8,819,591 5,000 (8,819,591) Property Taxes - delinq 45,000 45,000 - Penalties 8,000 8,000 - Miscellaneous Taxes 15,000 30,000 15,000 Fiscal Disparities (incl w/taxes) - - - PERA Aid 20,510 20,510 - MVHC - unallotment - - - Interest Earnings 25,000 15,000 (10,000) Franchise Fees 290,000 290,000 - Miscellaneous - - - Total Unallocated 9,223,101 408,510 (8,814,591) -95.57% Finance 400 Current Services 5,750 5,750 - 449 Miscellaneous 4,800 4,800 - Total Finance 10,550 10,550 3601 Legal - Court Fines 115,000 115,000 Municipal Building 380 Rent 2,500 - (2,500) 449 Other Miscellaneous - - - Total Municipal Building 2,500 - (2,500) -100.00% 400 Assessin - Charges for Service 1,200 1,500 300 25.00% Forfeitures City Clerk - - Penalties 312 Licenses 5,000 5,000 - 364 Administrative Citations - - - 400 Charges for Service - 5,000 5,000 345 Total City Clerk 5,000 10,000 5,000 100.00% 911 Service Fee - IGR 24,860 - (24,860) Inspections County Grants - - 318 Licenses and permits 246,500 269,180 22,680 364 Administrative Citations 8,000 8,000 20,000 20,000 Plan Check Fees 32,000 32,000 - Char es for Service 39,950 33,850 (6,100) Total Inspections 326,450 343,030 16,580 Forfeitures Police - - Penalties 330 Federal Grant - 82,000 82,000 344 State Aid 177,000 177,000 1,000 345 State Grants 86,000 10,000 (76,000) 345 POST Reimbursement 9,000 9,000 - 911 Service Fee - IGR 24,860 - (24,860) County Grants - - - 313 Licenses 96,200 96,000 (200) 360 Court Fines - 20,000 20,000 Forfeitures - - - Penalties 2,500 1,000 (1,500) 400 Charges for Services 40,000 42,000 2,000 449 Other Miscellaneous 500 1,000 500 440 Contributions 500 500 - Total Police 436,560 438,500 1,940 0.44% Increase (Decrease) 2012 2013 from % Department Budget Budget 2012 Budget Incr/(Decr) Planning & Zoning 320 Permits 1,000 1,000 - 387 Variances 1,500 1,500 - 400 Charges for Service - Total Planning &Zoning 2,500 2,500 - 0.00% 4491Communitv Development - Misc 85,999 88,900 2,901 3.377% Use Reserves Total Revenues Fire -83.85%� 318 Licenses 3,500 3,500 - 320 Permits - - - 384 Federal Grant - - - 344 State Aid 70,000 70,000 - 449 County Grants - - - 450 Administrative Citations - - - 400 Current Service 70,000 3,000 (67,000) Donations - Miscellaneous - Total Fire 143,500 76,500 (67,000) -46.69% Planning & Zoning 320 Permits 1,000 1,000 - 387 Variances 1,500 1,500 - 400 Charges for Service - Total Planning &Zoning 2,500 2,500 - 0.00% 4491Communitv Development - Misc 85,999 88,900 2,901 3.377% Use Reserves Total Revenues Public Works -83.85%� 329 Licenses & Permits 9,415 9,415 - 344 State Aid 125,000 130,000 5,000 384 Equipment Use Charge - - - 400 Charges for Service 2,750 2,750 - 449 Miscellaneous Revenue 4,000 4,400 400 450 Sale of Fixed Assets - - - Total Public Works 141,165 146,565 5,400 3.83% Planning & Zoning 320 Permits 1,000 1,000 - 387 Variances 1,500 1,500 - 400 Charges for Service - Total Planning &Zoning 2,500 2,500 - 0.00% 4491Communitv Development - Misc 85,999 88,900 2,901 3.377% Use Reserves Total Revenues Activity Center -83.85%� 380 Rent 26,000 26,000 - 400 Charges for Services 15,000 15,000 - 404 Memberships 8,500 8,500 - 440 Contributions 10,700 10,700 - 445 Fundraising 2,000 2,000 - 449 Other Miscellaneous 800 800 - Total Activity Center 63,000 63,000 - 0.00% Planning & Zoning 320 Permits 1,000 1,000 - 387 Variances 1,500 1,500 - 400 Charges for Service - Total Planning &Zoning 2,500 2,500 - 0.00% 4491Communitv Development - Misc 85,999 88,900 2,901 3.377% Use Reserves Total Revenues 10,556,525 1,704,555 (8,851,970) -83.85%� Total Expenditures 10,556,525 10,689,723 133,198 1.26% 2013 Revenue Shortfall - LEVY NEEDED( (8,985,168) 8,949,668 No levy limits for 2013 35,500 PERA Special Levy 2012 Levy - inlcudes special levies for GF 8,819,591 8,985,168 Total Estimated Tax Levy 1,704,555 Non levy revenues 10,689,723 Total 2013 Revenues shortfall CITY OF HOPKINS ANALYSIS OF GENERAL FUND EXPENDITURE BUDGET Increase (Decrease) 2012 2013 from % Department Budget Budget 2012 Budget Incr/(Decr) lCity Council 68,697 68,967 270 0.39% Administrative Services Administration 171,090 178,860 7,770 Personnel 44,405 46,768 2,363 Wellness 2,000 2,000 - Information Services 251,637 254,988 3,351 Total Administrative Services 469,132 482,616 13,484 2.87% Finance 135,000 142,000 7,000 Budget 26,249 26,388 139 Debt Management - - - General Accounting 133,402 137,199 3,797 Payroll 45,075 45,609 534 TIF Administration - - - Utility Billing 5,000 5,000 - Total Finance 209,726 214,196 4,470 2.13% Le al 135,000 142,000 7,000 5.19% 11 32,273 33,088 815 Elections 60,875 Munici al Building 296,863 313,998 17,135 5.771/:. 12,606 -11.46% Housing Inspections 135,597 158,882 23,285 Rece tionist 44,846 47,048 2,202 4.91% 79,260 78,908 (352) Vacant Property Management 2,700 lAssessing 173,091 177,187 4,096 2.37% City Clerk City Clerk 16,822 18,694 1,872 Records Management 32,273 33,088 815 Elections 60,875 45,582 15,293 Total City Clerk 109,970 97,364 12,606 -11.46% Inspections Building Code Inspections 268,598 261,854 (6,744) Fire Inspections 34,494 35,155 661 Heating & Plumbing Inspections 91,358 88,952 (2,406) Housing Inspections 135,597 158,882 23,285 Restaurant & Hotel Inspections 1,160 - (1,160) Misc. Community Inspections 79,260 78,908 (352) Vacant Property Management 2,700 4,666 1,966 Total Inspections 613,167 628,417 15,250 2.49% Police Police Administration 486,499 527,437 40,938 Patrol 2,466,299 2,653,370 187,071 SWAT Team 58,906 73,611 14,705 Reserves 24,467 15,959 (8,508) Investigations 430,357 615,083 184,726 Metro Drug Task Force 105,292 114,468 9,176 Pawn Shop 3,493 3,537 44 Outreach 84,036 107,332 23,296 Communications (Dispatch) 553,145 - (553,145) Support Services (Records) 252,356 310,813 58,457 Systems Management 65,182 65,855 673 Total Police 4,530,032 4,487,465 42,567 -0.949,46 (Decrease) 2012 2013 from % Department Budget Budget 2012 Budget Incr/(Deer) Fire Fire Department 851,559 920,261 68,702 Emergency Preparedness 3,865 4,030 165 Total Fire 855,424 924,291 68,867 8.05% Public Works 21,034 21,417 383 PW Building 32,739 34,988 2,249 Equipment Services 86,229 85,096 (1,133) Administration 27,442 38,345 10,903 Engineering 132,267 132,003 (264) Street & Alleys 859,205 888,724 29,519 Snow & Ice Removal 197,550 187,160 (10,390) Parks 652,465 679,471 27,006 Forrestry 210,780 233,774 22,994 Total Public Works 2,198,677 2,279,561 80,884 3.68% Recreation Playground 21,034 21,417 383 Ice Rink 12,192 13,113 921 Park Service 12,810 12,454 (356) Joint Recreation 152,000 155,000 3,000 Skate Park 7,063 7,165 102 Total Recreation 205,099 209,149 4,050 1.97% Activity Center Act Ctr- Community Use 264,914 270,180 5,266 Act Ctr - Maintenance 58,851 58,475 376 Total Activity Center 323,765 328,655 4,890 1.51% IPlanning & Zoning 126,837 129,683 2,846 2.24% lCommunity Development 85,999 88,926 2,927 3.40% Tuition Reimbursement 10,200 10,200 - 0.00% lContingency 90,000 50,000 40,000 -44.44% Total Expenditures 10,546,525 10,679,723 133,198 1.260/ Other Financing Uses Transfers Out 10,000 10,000 - Total Other Financing Uses 10,000 10,000 - 0.00% lGrand Total Expenditures 10,556,525 10,689,723 133,198 ( 1.26%1; Budget Incr in 2012 2.50% CITY OF HOPKINS ANALYSIS OF TAX LEVY Purpose Subject to Levy Limits General Fund Capital Levy Total Levy subject to Limits Special Levies: PERA Levy MVHC Levy - for unallotment of 2008 & 2009 MVHC Levy - for unallotment of 2010 Subtotal - Special Levies Other Debt Levies: 2001 GO Refunding Bonds - Park & Rec 2002B GO Improv Revolving Bonds 2003 HRA Revenue Bonds 2007B GO Improv Revolving Bonds 2007A Capital Improvement Bonds 2010A GO Improvement Bonds 2010B Refunding (200213 Improv Bds) 2012B Improvement Bonds Gas & Elec Franchise Fees - levy offset 2012B Equipment Certificates Fees used to offset levy Subtotal - Debt Levies Total - Special Levies TOTAL LEVIES Increase over prior year 08/02/2012 35,500 35,500 35,500 Incr 239,175 - - from 2010 2011 2012 2013 Est 2012 274,675 258,350 $ 8,384,010 $ 8,539,064 $ 8,784,091 $ 8,949,668 - - 100,000 125,000 125,000 59,000 $ 8.384.010 $ 8.639.064 $ 8.909.091 $ 9.074.668 1.86% 35,500 35,500 35,500 35,500 239,175 - - - - 222,850 - - 274,675 258,350 35,500 35,500 108,000 - - - 59,000 59,000 - - 200,000 200,000 220,000 220,000 185,000 172,000 184,500 186,520 715,000 710,000 765,900 763,800 - 100,000 77,000 77,000 - - 59,000 - 166,737 (107,657) 64,370 (64,370) 1,267,000 1,241,000 1,306,400 1,306,400 0.00% $1,541,675 $ 1,499,350 $ 1,341,900 $ 1,341,900 0.00% $ 9,925,685 $10,138,414 $10,250,991 $ 10,416,568 1.62% $ 372,571 $ 212,729 $ 112,577 $ 165,577 Percentage Incr (Decr) - Total 3.90% 2.14% 1.11% Tax Capacity Rate (per HC rate cards) 48.999 55.739 55.718 Increase/(Decrease) 1.6840 6.7400 (0.0210) Percentage Incr/Decr in Tax Capacity Rate 3.559% 13.755% -0.038% 1.62% Est. 0.0000 #DIV/0!