OFFICE OF
THE CITY COUNCIL
117 WEST DUVAL STREET, SUITE 425
4TH FLOOR, CITY HALL
JACKSONVILLE, FLORIDA 32202
904-630-1377
FINANCE
COMMITTEE BUDGET HEARING #1 MINUTES
August 11, 2016
9:00
a.m.
Location: City Council
Chamber, City Hall – St. James Building; 117 West Duval Street,
In attendance:
Council Members Anna Lopez Brosche (Chair), Aaron Bowman, Katrina
Brown (arr. 9:26), Bill Gulliford, Sam Newby, Matt Schellenberg
Excused: Greg Anderson
Also: Council Members Danny Becton, John
Crescimbeni, Garrett Dennis, Al Ferraro, Jim Love (arr. 10:38 a.m.), Lori Boyer
(arr. 1:00 p.m.); Peggy Sidman and Paige Johnston – Office of General Counsel; Kirk
Sherman, Kim Taylor, Philip Peterson, Brian Parks, Tommy Carter, Heather Reber,
Elena Korsakova - Council Auditor’s Office; Katrin MacDonald – Legislative
Services Division; Sam Mousa and Ali Korman Shelton – Mayor’s Office; Mike
Weinstein and Angela Moyer – Finance and Administration Department
Meeting Convened:
9:01 a.m.
Chairwoman Brosche convened the meeting and the attendees introduced
themselves for the record. Ms. Brosche established procedural ground rules for
the committee’s deliberations for this year’s budget hearings. The Council
Auditor’s recommendations will form the basis of the committee’s agenda and
original motions, and the administration may offer additional motions based on
latest available information. A running tally of proposed changes/enhancements
that will require additional revenue resources will be kept for action at a
wrap-up meeting if not dealt with at a hearing. Vice Chair Matt Schellenberg
and Council President will offer motions for consideration on behalf of
non-Finance Committee members who may be present. The Council Rule regarding
speaking time (5 minutes first time, 3 minutes second time) will be enforced,
with responses to council member questions not counting against the council
member’s time.
Introduction by Administration
Chief Administrative Officer Sam Mousa said the proposed budget does
not reduce any service levels or personnel complements from the current year
budget. Public safety (police and fire) is the Mayor’s top priority. There are
some minor service level increases where recurring revenues would allow improvements;
no one-time revenues are used for on-going services. Mr. Mousa complimented
Budget Officer Angela Moyer and the Council Auditor and his staff on the
preparation and preliminary review of the budget and said he and Finance
Director Mike Weinstein will be present at all meetings to answer questions. In
response to a question from Council Member Gulliford, Mr. Mousa said that there
are no extraordinary lapses imposed on departmental budgets. He also said that
there are no major changes to the budget since it was introduced, only minor
tweaks with identified funding sources.
Council Auditor’s Introduction
Council Auditor Kirk Sherman gave a brief overview of the 8
budget-related ordinances and the budget review and adoption timeline. Because
of solid growth in the value of taxable property (although not yet recovered to
pre-recession levels), estimated ad valorem revenue is projected to increase by
approximately $42 million at the same millage rate. He explained how the Save
Our Homes amendment keeps the tax levy on homesteaded properties from rising
more than the rate of inflation or 3%, whichever is less. The Council is
ultimately responsible for approving budgets amounting to $4.9 million for the
City proper and the independent authorities. The City’s General Fund budget is
proposed to increase by approximately $35 million, the special revenue funds
are nearly unchanged as are capital projects, and the enterprise fund budgets
are down by $16 million. The budgets of the SMG public venues are being
combined into a single, more easily understandable budget. The number of
full-time authorized employees in the General Fund is going up by 87 positions
(including 40 police officers and 40 community services officers in the JSO and
4 new positions in the Building Inspection Division).
Council Member Gulliford noted that 12 positions in the Fire and
Rescue Department are converting from grant-funded to General Fund-funded, and
that the same applied to some positions in the Sheriff’s Office last year. New
council members need to recognize the future impact when accepting grants to
hire new positions.
The former Intra-Governmental Services Department has been disbanded
and the majority of those positions transferred to the Finance and
Administration Department which is picking up most of the services
Intra-Governmental Services formerly provided. Total General Fund personnel
expenditure (salary and benefits) is proposed to increase by $30 million or
4.84%. In response to a question from Council Member Becton, Mr. Sherman
indicated that the $3 million allocated in the current year budget for salary
increases to restore the 2% salary reductions imposed in 2010 was not expended
and remains to be reallocated if the Council desires. CFO Mike Weinstein said that
the Council had allocated $740,000 specifically to restore the 2% reductions
for non-collectively bargained employees and, while those funds were not
specifically used for that purpose, a majority of the employees for whom that
would have been applicable have received other types of increases or are no
longer employed by the City. The cost to restore the 2% reductions to the
remaining employees is down to just over $200,000.
Page references from this point refer to
Auditor’s Budget Hearing #1 handout.
Mr. Sherman noted Auditor’s recommendation #1 on p. 17 to decrease the
Communication Services Tax revenue by $2,595,751 as a result of changes in the
state’s revenue projection for this revenue source. This reduction will also
have a negative impact on the Jacksonville Port Authority’s budget which
utilizes a portion of this revenue.
Motion (Schellenberg): p.
17, approve the Auditor’s recommendation #1 to reduce the Communication
Services Tax revenue by $2,595,751 – approved
unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #2 to reduce the Build America Bonds
interest rate rebate by $151,749 to $449,649 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #3 to reduce indirect cost recovery by
$46,270 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #4 to reduce the Court Fines - Traffic
by $64,670 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #5 to increase Payment in Lieu of Taxes
- FPL by $41,457 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #6 to increase half cent sales tax
revenue by $451,885 – approved
unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #7 to increase 7th Cent Gas
Tax revenue by $128,122 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #8 to increase 8th Cent Gas
Tax revenue by $728,107 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #9 to increase county sales tax revenue
by $1,193,018 – approved unanimously.
Motion (Schellenberg): on
p. 17, approve Auditor’s recommendation #10 to increase Surplus Gas Tax revenue
by $2,729,315 – approved unanimously.
Finance Director Mike Weinstein explained the reasons for the
difference in the administration’s revenue projections from some sources versus
the Council Auditor’s projections. Partially it is a matter of timing (the
auditors have another month of data on which to base their projections) and
partially it is related to the degree of conservatism in estimating.
Chairwoman Brosche said that she has initiated a project to work with the
City Procurement Division to develop a system to share the City’s active vendor
list with the Tax Collector’s Office so that the Tax Collector can ensure that
all the companies on the list hold current City business licenses.
Mr. Sherman explained the need to take some action regarding the
unspent revenues of the Northbank and Southbank Downtown CRAs. Mr. Mousa said
that the administration was unaware that the Ordinance Code has a provision
applying to the downtown Community Redevelopment Areas (Northbank East and West
and Southbank) that differs from the state statute regarding use of CRA funds
remaining unspent at the end of a fiscal year. The state statute says that
unspent CRA funds can be swept back into a government’s General Fund for
reallocation; Jacksonville’s Ordinance Code provides that any Northbank and
Southbank CRA funds unspent at the end of the year must be segregated into an
account to be retained only for downtown uses. Mr. Sherman offered two options:
waive the Ordinance Code to allow the unspent funds to be swept into the
General Fund or leave the unspent funds in the CRAs and find $4.69 million to
make the proposed budget whole. Mr. Mousa said that the current fiscal year
will have a relatively healthy fund balance and could be a funding source for
this transaction if that is Council’s desire; the required reserve fund balance
should be achievable. Council Member Katrina Brown advocated for leaving the
CRA funds in the CRA accounts and using year-end reserves to make up the $4.7
million needed.
Council Member Crescimbeni noted that the Northbank combined CRA is
still cash negative compared to its obligations and the proposal to use
reserves would add to the subsidy the General Fund already provides. He also noted
that if the Downtown Investment Authority board, which governs the two downtown
CRAs, decided to expend all of its TIF revenues annually, the need for General
Fund subsidy to meet all of the CRAs obligations would increase. In response to
a question from Councilwoman Brown, Mr. Mousa said the administration has no
interest in advocating for any change in the current ordinance regarding those
downtown CRA funds. Council Members Schellenberg and Crescimbeni requested
additional information on the history of General Fund subsidies to the downtown
CRAs. The committee will take no action until after it has heard from Council
President Boyer on the subject.
Mr. Sherman reviewed several pages of overview of departmental and
non-departmental expenditures and answered several questions about particular
line items. With regard to the additional accrued pension liability payments
the City is making to the Police and Fire Pension Fund, Council Member
Gulliford said that the agreement for those additional payments provides that
the payments would be discontinued when a permanent funding source for the
pension amortization obligation is established.
Motion (Schellenberg): on
p. 28, remove the $650,000 Subfund 011 Economic Grant program allocation and
the $100,000 Subfund 011 QTI allocation from the Schedule of Capital Projects
Not Lapsed Schedule AF – approved
unanimously.
Motion (Schellenberg): on
p. 36, approve Auditor’s recommendation #1 reduce the transfer from General
Fund GSD to Subfund 259 by $929,295 and reduce the General Fund GSD transfer to
Subfund 4F6 for interest due by $3,238 - approved
unanimously
Motion (Schellenberg): on
p. 36, approve Auditor’s recommendation #2 reduce the Medicaid funding by
$1,190,672 - approved unanimously
Motion (Schellenberg): on
p. 36, approve Auditor’s recommendation #3 to remove the carry-forward from
FY15-16 in the amount of $650,000 for economic incentive grant payments and
$100,000 for QTI payments and instead fund them out of the FY16-17 budget – approved unanimously.
With regard to the Schedule of Capital Outlay Projects Not Lapsed, Ms.
Moyer said that the dollar amounts listed are maximum amounts. If the actual
amounts are lower by year-end, the lower amount will be carried over.
Motion (Schellenberg): on
p. 28, approve Auditor’s recommendations #1 through #6 – approved unanimously.
Mr. Mousa pointed out that the Public Buildings – Other Construction
Costs item in Subfund 5A1 for $95,000 is the funding allocated for office space
build-out for the Inspector General’s office in the Yates Building. He noted
that a resolution has been introduced in City Council to urge the Inspector
General’s return to City Hall; no action will be taken to expend any of those
funds until the resolution is acted upon by Council and the future location of
the IG is determined.
Motion (Schellenberg): on
p. 29, approve Auditor’s recommendation #1 to revise budget schedule A2 to
reduce the Court Costs $65 fee Trust revenue to $247,891 and to increase the
Driver Education Safety Trust to $300,000 to match the proposed budget – approved unanimously.
Motion (Schellenberg): on
p. 33, approve Auditor’s recommendation to delete the duplicate listing of
$1500 for food for the Annual Homeless Veterans Stand-Down Event – approved unanimously.
Motion (Schellenberg): on
pp. 35-36, approve Auditor’s recommendation to attach a Revised Attachment B –
Chart of Council Member Salaries Being Waived – approved unanimously.
Motion (Schellenberg): on
p. 39, approve Auditor’s recommendation that the Finance Committee, through its
budget deliberations, pursue the elimination or reduction of borrowing for
vehicle purchases– approved unanimously.
Motion (Schellenberg): on
p. 42, approve Auditor’s recommendation to remove the first sentence of the
waiver language referencing SMG’s competitive procurement policies – approved unanimously.
Sam Mousa addressed the subject of performance measurement and
described the difficulty of comparing Jacksonville with other jurisdictions
because of differences in how cities define their terms and include or don’t
include a variety of costs when determining unit costs. The administration is
undertaking a performance measurement program that compares Jacksonville’s
performance year over year, which will be reported in future budgets.
Motion (Schellenberg): on
p. 46, approve Auditor’s recommendations to add provisions to the FY16-17
budget ordinance regarding a recapture review for contributions to subfunds
with negative cash balances and a proviso regarding the deposit of library
fines into a special revenue fund – approved
unanimously.
The committee was in recess from 11:55 a.m. to
1:00 p.m.
Inspector General’s Office
Interim Inspector General Steve Rohan and Lisa Green, Chief of
Investigations addressed the committee. Mr. Rohan explained that he had
arranged for contribution from the independent authorities toward the budgets
of the Inspector General’s Office and the City Ethics Office in the following
amounts: Ethics Office - $5,000 from each of the JEA, JTA, JPA and JAA for a
total of $20,000; Inspector General’s Office - $85,000 from the JEA and $10,000
from each of the other 3 authorities for a total of $115,000. These figures
represent the first year of a two-year commitment on the part of each of the
authorities. The IG will keep records of how much time and resources
Motion (Schellenberg): approve
the Inspector General’s requested budget amendment to appropriate independent
agency contributions in the amount of $115,000 to the IG’s Office and $20,000
to the City Ethics Office – approved
unanimously.
Mr. Rohan explained his budget enhancement request of $114,698 for one
full-time investigator and 1,300 part-time hours for an administrative
assistant position
Motion (Schellenberg):
approve the IG’s request for appropriation of $114,698 for one full-time
investigator and 1,300 part-time hours for an administrative assistant position,
notary fee and AIG membership, hardware/software maintenance and licenses,
other operating supplies to purchase new cell phone, desks, chairs, file
cabinets/shelves and supplies, interview room and conference room furniture,
travel and employee training
Motion (Gulliford): amend
to add “pending satisfactory review by the Council Auditor’s Office”
The Schellenberg motion as amended by the Gullford motion was approved unanimously.
Motion (Schellenberg):
move the $302 not allocated for expenditure in the IG’s budget to Special
Council Contingency – approved
unanimously.
In response to a question from Council President Boyer, Kirk Sherman
indicated that he had just received the Inspector General’s second amendment
request and had not had a chance to review the calculations contained therein. Mr.
Rohan and Ms. Green explained the sequence of employee hiring in the office
over the past year. Council Member Crescimbeni questioned the amounts, if any,
appropriated to the IG’s office in the current fiscal year for office build-out
and furniture purchases and expressed concerns about the delay in hiring
approved personnel and reallocating salary dollars to furniture acquisition.
Mr. Sherman indicated that his staff had had the chance to do a review of the
handouts just distributed by the Inspector General and found that the numbers
appeared to balance correctly.
Ethics Office
Ethics Officer Carla Miller advocated for a budget enhancement to add
additional staff to the one full-time and one part-time employee currently
working in the office using the new income from the independent authority
contributions to the Ethics Office as the funding source. The Chair repeated
her comments from the beginning of the meeting that the committee would not be
considering any enhancements during the departmental hearings but would keep a
running tally of requests to be considered at a wrap-up meeting at the end of
the process if funds are available.
Motion (Schellenberg):
appropriate $15,000 in salaries and $5,000 in benefit costs to the Ethics
Office
Motion (Crescimbeni):
amend the motion to appropriate $20,000 to the Ethics Office with the Council
Auditor to determine the exact amount for salary and benefits within that cap
The Schellenberg motion as amended by the Crescimbeni motion was approved unanimously.
Sheriff’s Office
In response to a question from Council Member Schellenberg, Sheriff
Mike Williams and JSO Budget Officer Bill Clement reported that 105 personnel
are in the DROP program and will be retiring during the new fiscal year. The
Sheriff discussed recruitment and hiring and reported that he is taking a
comprehensive look at inmate health in the corrections system with an eye
toward making changes to improve efficiency. Committee members posed questions
about the increase in worker’s compensation heart and hypertension claims and
what steps the department is taking to try to reduce those claims.
Motion (Schellenberg): on
p. 54, approve Auditor’s recommendation #1 to increase the employee cap by 1
and to appropriate $74,442 to fund a Public Safety Analyst position to be fully
reimbursed by the State Attorney’s Office – approved unanimously.
Motion (Schellenberg): on
p. 54, approve Auditor’s recommendation #2 to bring process service in-house
with a total cost of $295,017, a savings of $134,655 to the Special Council
Contingency fund - approved unanimously
Motion (Schellenberg): on
p. 55, approve Auditor’s recommendation #3 to include $507,132 in the budget to
match the COPS grant, offset by an increase in the Sheriff’s salary lapse - approved unanimously.
Motion (Schellenberg): on
p. 55, approve Auditor’s recommendation #4 to reduce the SMG overtime
reimbursement revenue by $801,911 to correct an erroneous calculation, with
$675,669 being covered by savings in jail meal costs under a new contract and a
charge to Special Council Contingency of $126,842- approved unanimously
Council Member Gulliford asked Sheriff Williams to become personally
involved in meetings about the future of Hemming Park and to suggest ideas for
how the undesirable behaviors in the park can be curbed. If the Ordinance Code
needs to be amended to make the JSO’s enforcement more effective, the Council
is willing to consider making those changes. Mr. Crescimbeni reiterated that
the Council is ready and willing to make whatever Ordinance Code changes are
needed to make JSO’s enforcement better.
Finance Director Mike Weinstein explained the change in state law
several years ago that changed the presumption and burden of proof for heart
and hypertension workers comp claims to place the burden of (dis)proof on the
government. He described the City’s vehicle replacement policy for police cars.
In response to a question from Council Member Bowman, Sheriff Williams
explained his department’s change in hiring qualifications to no longer require
a college degree for initial applicants. That change opens up the potential
applicant pool and should make recruiting easier. In response to a question from Council Member
Katrina Brown about overtime usage, the Sheriff explained how squads of
officers are deployed to attack high crime areas. The Sheriff also answered
questions about the arrangement the department has with apartment complexes to
provide free or reduced rent to police officers in exchange for enhanced
security services at the complex, noting that the details of the arrangements
vary from complex to complex about what exactly the officer is expected to do.
Ms. Brown asked for information about how many officers are participating in
such residential arrangements and what duties they perform. She is concerned
that some apartments are implying to residents that the resident police
officers are providing security services for the complex when the written
agreements may not require much if any real security service.
Sheriff Williams described the upcoming pilot program beginning in
spring 2017 to test body cameras for police officers using 4-6 vendors
providing different types of cameras. Bill Clement said the COPS grant has two
more years to run subsidizing the salaries of officers, after which the full
cost will be the City’s responsibility. Council Member Schellenberg asked the
Sheriff’s Office to report back on whether they have considered using cloud
storage for data rather than purchasing servers.
Fire and Rescue Department
In response to a question from Council Member Brown, Fire Chief Kurtis
Wilson explained the reasons for the reduction in ambulance revenue projections
despite the increase in the number calls and transports, which include reduced Medicare
and Medicaid reimbursement rates and the proliferation of stand-alone emergency
rooms which reduces transport distances and therefore the mileage charge
revenues. Revenues are also decreasing in the fire inspection function because
of an increase in non-payment of bills. A settlement of a lawsuit over fire
inspection fees will be coming to the City Council in the next several months
and that will offer an opportunity to re-think the billing and collection
process. Chief Wilson answered a question about the increase in overtime costs
due to increased vacancies in the department due to firefighters retiring under
the DROP program and increased absences due to injury and illness. Filling
vacancies is limited by the number of personnel in a fire academy class and the
timing of their graduations.
In response to a question from Council Member Gulliford, Chief Wilson
explained how the department’s hiring of several ambulance billing collection
personnel has led to substantially increased revenue. The chief reported that
the department is now buying lighter weight rescue vehicles on lighter chassis
which has drastically reduced operating costs. Chief Wilson explained the
status of the department’s SAFER grant-funded positions – 67 employees hired 3
years ago with the federal government paying the salaries for 2 years (3 years
for veterans). The department has applied for a grant for an additional 26
positions. In the first seven months of this fiscal year EMS calls were up 7%
and fire calls were up 5%. The department is projecting 150,000 total calls
this year, over 80% of which will be rescue calls.
Chief Wilson explained the department’s staffing requirements and
overtime usage required to keep units operational because of minimum per piece
of apparatus. There currently are no restrictions on how many hours a
firefighter can work in a week or month and how much overtime they can accrue,
and there are no regulations on how many consecutive hours an employee can be
on duty.
Property Appraiser’s Office
Property Appraiser Jerry Holland noted that he has not budgeted for
any pay raises in the new budget as requested by the Mayor’s Office despite the
fact that inadequate salaries have cost him 5 employees in recent months who
left for higher salaries. The Mayor’s Office did not approve his office’s
$165,000 request for new computer change technology that would allow aerial
photographs of properties to be compared for purposes of determining building
changes, which would allow a reduction of personnel assigned to that tax. Mr.
Holland reported that the office has experienced a substantial increase in
productivity in the last year both in terms of illegal homestead claims
identified and of number and dollar amounts of liens levied. Sam Mousa said
that the administration is willing to review the Property Appraiser’s budget
and if there is sufficient available unexpended salary, the Mayor’s Budget
Review Committee is willing to consider reallocating the salary dollars to the
purchase of the computer software. Mr. Holland explained that Department of
Revenue regulations don’t allow reprogramming of funds from salaries to other
uses, so he doesn’t believe this approach would work. Mr. Mousa said the
administration will work with Mr. Holland to explore options.
Motion: on p. 68, approve
Auditor’s recommendation #1 to make various minor adjustments in the proposed
budget to align the Mayor’s budget with the budget tentatively adopted by the
Council several months ago and subsequently approved by the Florida Department
of Revenue – approved unanimously.
Motion: on p. 68, approve
Auditor’s recommendation #2 to reduce the postage line by $417 to match the
DOR-approved budget – approved
unanimously.
Motion: on p. 68, approve
Auditor’s recommendation #3 to approve the Property Appraiser’s corrected
budget of $10,174,143 to incorporate all changes made since the tentative
budget approval several months ago - approved
unanimously.
The Special Council Contingency fund stands at a positive $1,019,519
at the end of Hearing #1.
Outstanding items
·
CRA budgets – in the City budget or approved
separately?
·
Vehicle purchases – waiver for borrowing or
use fund balance?
·
Waiver of $25,000 minimum threshold for CIP
projects – waive to include $4396 project
·
Property Appraiser change comparison software
request
·
Ethics Office personnel enhancement request
Meeting adjourned:
3:41 p.m.
Minutes: Jeff Clements, Council Research
8.12.16
Posted 9:00 a.m.
Tapes: Finance Budget Hearing #1
– LSD
8.11.16
Materials: Council Auditor’s Budget Meeting #1 handout - LSD
8.11.16