HomeMy WebLinkAbout2018-06-05 Finance MinutesCity of Tukwila
City Council Finance Committee
FINANCE COMMITTEE
Meeting Minutes
June 5, 2018 - 5:30 p.m. - Hazelnut Conference Room, City Hall
Councilmembers: De'Sean Quinn, Chair; Dennis Robertson, Kate Kruller
Staff: David Cline, Bruce Linton, Peggy McCarthy, Henry Hash, Rachel Bianchi, Jay
Wittwer, Laura Crandall, Laurel Humphrey, Trish Kinlow
CALL TO ORDER: Committee Chair Quinn called the meeting to order at 5:30 p.m.
I. PRESENTATIONS
II. BUSINESS AGENDA
A. Public Safety Plan Financing
As follow up to the May 22, 2018 Committee meeting, staff provided various financing scenarios
for the Public Safety Plan including Whitebirch modeling against the six-year financial forecast.
Staff also provided preliminary information on 1st quarter sales tax, which at this time appears
to be equivalent to 1st quarter 2017. The Committee was asked to recommend a preferred
financing scenario to be presented to the full Council at its June 11, 2018 Work Session with a
goal of final action on June 18, 2018. Staff's recommendation is "Option E" with LTGO financing
over 30 years, as shown below:
This scenario includes construction of all facilities within the current timeline, dedicates
$30M to shops, and implements a State financing tool that allows cities to finance large
apparatus over 10 years. Staff believes that this scenario provides the greatest flexibility for
the general fund.
Councilmember Robertson spoke to his concerns about the sales tax, as the financial
analysis of all scenarios assumes a small annual increase and there is no indication this will
occur. He looked at two additional scenarios with a 0% increase and a 1.5% increase and is
concerned about the impacts to the fund balance.
LTGO Repayment
Method
Option
FS 51
FS 52
FS 54
A&E
JC
—
PW
LTGO
Bond
Range of
Annual Cash
Contribution
Capacity
from
maturing
debt
Total
GF
Cont.
Total
Debt
Service
—
E-30
$12M
$17M
$14M
$15M
$68M
$30M
$55M
$283K
in 2017
$830K $2M
per yr
$51.9M
$70.6M
This scenario includes construction of all facilities within the current timeline, dedicates
$30M to shops, and implements a State financing tool that allows cities to finance large
apparatus over 10 years. Staff believes that this scenario provides the greatest flexibility for
the general fund.
Councilmember Robertson spoke to his concerns about the sales tax, as the financial
analysis of all scenarios assumes a small annual increase and there is no indication this will
occur. He looked at two additional scenarios with a 0% increase and a 1.5% increase and is
concerned about the impacts to the fund balance.
Finance Committee Minutes June 5, 2018
Councilmember Kruller stated that she does not mind sensible borrowing and is not supportive
of 30 -year financing. She was concerned about apparatus and equipment, as well as the
construction timeline for all of the buildings, and sees relief in Option D. She is also open to the
idea of delaying the Justice Center and would like the City to look at creative solutions regarding
renting to other businesses.
Chair Quinn stated that he is comfortable with Option D along with apparatus funding as
identified in Option E. He is concerned about taking on too much debt and binding future
Councils, so prefers 20 -year financing. Future budget discussions will have to include
consideration of new revenues and potential cuts. He thanked staff for getting the Committee to
this point and acknowledged more hard budget decisions to come.
Councilmember Robertson said he agrees that Option D with 20 -year financing is the best option
of those presented. He appreciates that previous Councils did not bury the City in long-term debt.
He requested for the Council work session that staff prepare Options D and E with both a flat and
a 1.5% sales tax so the Council can see worst case scenarios.
UNANIMOUS RECOMMENDATION. FORWARD TO JUNE 11, 2018 COUNCIL WORK SESSION
WITH ADDITIONAL INFORMATION REQUESTED.
III. MISCELLANEOUS
Adjourned at 6:20 p.m.
Committee Chair Approval
Minutes by LH
LTGO Repayment
Method
Option
FS 51
FS 52
FS 54
A&E
JC
—
PW
LTGO
Bond
Range of
Annual Cash
Contribution
Capacity
from
maturing
debt
Total
GF
Cont.
Total
Debt
Service
—
D-20
$12M
$17M
$0
$15M
$68M
$30M
$40M
$500K $1M
2026-2032
$500K
$1.2M per yr
$21.6M
$37 M
UNANIMOUS RECOMMENDATION. FORWARD TO JUNE 11, 2018 COUNCIL WORK SESSION
WITH ADDITIONAL INFORMATION REQUESTED.
III. MISCELLANEOUS
Adjourned at 6:20 p.m.
Committee Chair Approval
Minutes by LH