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Home My WebLink AboutReg 2014-09-02 Item 2C - 2015-2016 Biennial Budget Update - Tab 1: 2015-2016 Budget Preview2015 -16 Budget Preview City of Tukwila September 2, 2014 September 2, 2014 2015 -16 Budget Preview 1 MI L Agenda • Timeline • General Fund Revenues • General Fund Expenditures • Departmental • Debt Service • Capital Project funding • General Fund balance • Financial Planning Model • Capital Improvement Program DELIVERABLES 10114 :10MIlliTe1_[elM14011 4 Z w X e7Kef' 1 /E i l 2013 2014 Oct Nov Dec Jan Feb ( Mar A.r ( Ma Jun Jul Au! Sep Oct Nov Dec 0 Council /Exec Team Workshop #1 > potential 2015/16 Priorities 10/10/2013 Admin Team / Berk ,> Refine 15/16 priorities 12/17/13 Potential Impacts on Budget > Facilities Plan > Fire Authority • 0 Council /Exec Team Workshop #2 >Finalize 2015/16 Priorities Council Retreat > Refine 15/16 priorities 01/25/2014 • Admin Team > Proposals- vetted • Admin Team > Budget presentations heard; preliminary decisions made - staff increases, other initiatives • `0 Dept Staff Finance/Dept > Proposals presented >Priorities discussed with 'dept staff Admin Team W Admin Team > Review, refine draft budget • 0 Dept Staff Finance > Budgetfiles available > Budgets discussed, justified > Budget files due Community Engagement > Report on 2013 accomplishments >Gatherfeedbackon 15/16 priorities Council briefing COW > Compile draft budget > Refine draft budget Community Engagement > Bri of i ng /update >Tukwila Reporter article Finance /Depts Dept staff Dept staff 1. Finance distributes priorties list 2. Dept proposals presented 3. Finance provides budget files to de pts 4. Budget files to Finance 5. Draft budget • > Mayor presents preliminary budget Council Workshop > kick -off Finance Council > Budget adoption >Public Hearing 6. Preliminary budget completed 1ML 2015 -16 Priorities 1. Tukwila International Boulevard Community Transformation 2. Community Livability 3. Create Community Partners to Implement City- wide Plans and Visions 4. Develop /Implement Comprehensive Economic Development Plan 5. Continue to create a more effective organization 6. Improved communications and community identity September 2, 2014 2015 -16 Budget Preview 4 MI Revenue Assumptions • Construction activity increases in 2015 and accelerates in 2016 • Tukwila Village • TIB Redevelopment project • Other • Economy continues to strengthen 2015 -16 Budget Review 5 MC Revenue Projections TAXES 2015 2016 5 Year Average Property tax 3.0% 3.5% 3.0% Sales tax 3.0% 3.5% 2.0% Utility tax 1.9% 2.0% -1.6% Interfund utility 4.0% 6.4% 5.0% RGRL 2.0% 2.0% 2.6% Gambling, excise 1.9% 2.5% 3.5% Total Taxes 2.8% 3.3% 2.5% (a) (b) (a) Average of 2010 -2013 actual and 2014 estimated results. (b) 3 -year average from 2011 implementation. September 2, 2014 2015 -16 Budget Preview 6 MC Revenue Projections OTHER REVENUE 2015 2016 5 Year Average Sales tax mitigation 0.9% 0.0% -6.1% SCL Agreement 3.1% 3.0% 2.8% Licenses & permits 4.4% 2.5% 10.5% Intergovernmental -9.5% 3.1% -1.4% Charge for service 0.9% 1.6% 7.9% (a) Average of 2010 -2013 actual and 2014 estimated results. September 2, 2014 (a) 2015 -16 Budget Review 7 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% - 1.0% - 2.0% - 3.0% - 4.0% - 5.0% Ongoing Revenue Trend Ongoing Revenue % Change 4.2% 2.9% -4.1% 3.2% 2010 2011 2012 2013 2014 2015 2016 September 2, 2014 2015 -16 Budget Preview 8 =IL One -time Revenue Property Sales • Tukwila Village Land sale • Newporter property • Longacres property • Old Fire Station 53 MU Risks & Considerations • Revenue risks: • Revenues fall short of projections • Property sales are delayed or proceeds are less than projected • Policy considerations: • Interfund utility tax sunset in 2015 • Voter approved new revenues • Revenue increases not requiring voter approval MC Proposals Description Cost 2015 2016 Comments Est Add'I Add'I Budget Budget 1 Legally Mandated Public Defender caseload limitation Tier One Code Enforcement Public Records request assistance Fire equipment; September 2, 2014 $275K $275K $275K In Mayor's budget a professional services. $85K $87K $87K In DCD budget as professional services $97K $100K $100K In Attorney's budget as professional services $30K - $137K $0 In Fire budget as supplies: $140K Airpack cylinders, thermal imaging cameras, defibrillators 2015 -16 Budget Preview 11 Pro osals Description Cost 2015 2016 Comments Est Add'I Add'I Budget Budget Tier Two Recreation $100K- $0 $0 Accomplished with existing afterschool $300K budget through program partnership with TSD and YMCA Police recruiter .5 $56K $0 $59K $0 Accomplished with existing FTE budget through process improvements City Identity, $100K $39K In Communications budget communication as professional services strategy Economic $30K - $60K $60K In Economic Development Development Plan $100K budget as professional services -201546-Budget 6-- Budget Previe% i 1 01-4 .1 MI Departmental Expenditures • Mayor's Office • Public defender costs • Communications division • Enhanced Economic Development ❖ City Attorney • Public records request initiative ❖ Park & Street Maintenance • Utility costs September 2, 2014 2015 -16 Budget Preview 13 MI Departmental Expenditures ❖Fire Department • Fire equipment appropriation • Fleet and apparatus replacement reserve holiday ❖Finance • Insurance and claims September 2, 2014 2015 -16 Budget Preview 14 •er Expenditures by Type ❖ Salaries • decrease in 2015 compared with 2014 budget ❖ Benefit increase • Retiree Leoff 1 premiums • Employee healthcare experience • PERS increases ❖ Supplies • Fire equipment • Police ammunition September 2, 2014 2015 -16 Budget Preview 15 • Expenditures by Type ❖ Professional services • Public defender costs • Communication and City identity • Economic Development plan • Code enforcement enhancement • Insurance, Utilities ❖ Intergovernmental • Valley Com & SCORE ❖ Capital • Reduction with implementation of permit system September 2, 2014 2015 -16 Budget Preview 16 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% - 1.0% - 2.0 - 3.0% - 4.0 Expenditure Trend Departmental Expense % Change -2.8% 2.6% 6.0% 1.5% 2010 2011 2012 2013 2014 2015 2016 September 2, 2014 2015 -16 Budget Preview 17 Risks & Considerations +CERT Trainer carried at 100`)/0 City funding ••Fire apparatus & fleet replacement funding on hold ••Employee healthcare claim experience and trend +Retiree Leoff 1 healthcare premiums restored 1 • $4,000 m $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 — $500 City of Tukwila General Obligation Bond Debt Service • SCORE $0 1 • SC Parkway Extension /HHD • Arterial Street, KC Bridge • City Hall Annex, Tukwila Village • Valley Com • MPD Capital Loan NEW -BAR Bridge ▪ :id EW- 42-ndAre 5 • TCC, Fire Station #53 NEW- Interurban Ave S NEW -Urban Renewal e-S III 11111111_I111 ,LO 0 ,LO � ,LO co ,LO A ,LO % ,LO 0 ,LO 0 ,LO ti r , � ,LO � ,LO � ,LO � ,LO � ,LO 1 ,LO � ,LO ,LO LO ,LO ,LO ,LO ,LO ) LO � ,LO 1 ,LO % ti N. titi ti ti ti ' 3 " " 3 30) ,LO September 2, 2014 2015 -16 Budget Preview 19 IIU Proposed New Debt Residential Streets: 42nd Ave S 53rd Ave S Total Bonding Estimated Annual Debt Service $3,800 1,700 5,500 $ 440 Non Voted Debt Capacity 2015 = $46.0M 2016 = $46.4M Calculated with proposed new debt included September 2, 2014 2015 -16 Budget Preview 20 Capital Projects Paid for through General Fund Transfers Routine maintenance: • Overlay • Bridge inspections • Annual traffic signal program • ADA improvements • Wetland mitigation 2015 budget $2,108K 2016 budget $2,008K September 2, 2014 2015 -16 Budget Preview 21 NMI Capital Projects Paid for through General Fund Transfers In Thous $ 2015 2016 Arterial Street: Routine maintenance $ 2,108 $ 2,028 Ped Bridge 1,283 280 Andover Park West 470 BSNF 250 Walk & roll plan 140 Transp comp plan 100 S 144th 231 90 4,582 2,398 General Government: Facility improvements 200 200 General Fund Contribution to Capital Projects $ 4,782 $ 2,598 September 2, 2014 2015 -16 Budget Preview 22 It Projected Financial Results + General fund draw down of $695K for biennium + Margin of ongoing revenue versus ongoing expenditure September 2, 2014 2015 -16 Budget Preview 23 • 8.0% 6.0% 4.0% 2.0% 0.0% - 2.0% -4.0% - 6.0% Changes Ongoing Revenues & Expenditures Ongoing Revenues versus Ongoing Expenditures 6.0% 4.2% 3.2% 2.2% - 2.8% -7.7° - 4.1% 1.6% 1.5% 2010 2011 2012 2013 2014 2015 2016 Revenue % Change Exp % Change September 2, 2014 2015 -16 Budget Preview 24 li Financial Planning Model Attachment A: ❖ Revenue assumptions 1% to 3% ❖ Expenditure assumptions 2.5% ❖ Reserve policy met at end of Six -Years ❖ Governmental fund balance of $6.3M • Reserve fund balance of $6.1 M September 2, 2014 2015 -16 Budget Review 25 Governmental Fund Balances Attachment A* (In Thous) 27,433 $21,967 $21,370** $22,896 $22,542 $16,386 2009 2010 2011 2012 2013 * * exclusive of unspent bond proceeds. September 2, 2014 2015 -16 Budget Preview 26 Policy Considerations + Margin between ongoing revenues and expenditures + Fund balance levels •:• Level of debt and debt service September 2, 2014 2015 -16 Budget Preview 27 Capital Improvement Program September 2, 2014 2015 -16 Budget Preview 28 •Mli ✓ August ✓ September October November December July 28, 2014 Next Steps Develop budget draft 2014 2nd Quarter Financial Report Debt policy to Finance & Safety Council presentation — Budget draft and CIP Presentation of proposed budget Public Hearing on budget Budget Adoption 2015 -16 Budget Update 29 Comments & Questions Tukwila The City of opportunity; the community of choice. September 2, 2014 2015 -16 Budget Preview 30