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HomeMy WebLinkAboutReg 2014-10-06 Item 5.02 - 2015-2016 Biennial Budget - Introduction The Government Finance Officers Association of the United States Distinguished Budget Presentation Award to the City of Tukwila, for the biennium beginning January 1, 2013. In order to receive publish a budget document that meets program criteria as a polic as a financial plan, and as a communications device. This award is valid for a period of two years. We believe our c conform to program requirements, and we are submitting it to GFO another award. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON; ADOPTING THE BIENNIAL BUDGET OF THE CITY OF Tukwila FOR THE 2015-2016 BIENNIUM; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, the preliminary budget of the City of Tukwila for the 2015-2016 biennium was submitted to the City Council in a timely manner for their review; and WHEREAS, a Public Hearing on the proposed budget was advertised and held on November 10, 2014; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY ORDAINS AS FOLLOWS: Section 1. - 2016 ccordance with RCW DRAFT . 35A.34.120 Section 2. The totals of the estimated revenues and appropriations for each separate fund and the aggregate totals are as follows: Section 3. A complete copy of the final budget for 2015-2016, as adopted, together with a be transmitted by the City Clerk to the Division of Municipal Corporations of the Office of the State Auditor and to the Association of Washington Cities. Section 4. Corrections by City Clerk or Code Reviser. Upon approval of the City Attorney, the City Clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; references to other local, state or federal laws, codes, rules, or regulations; or ordinance numbering and section/subsection numbering. Section 5. Severability . If any section, subsection, paragraph, sentence, clause or phrase of this ordinance or its application to any person or situation should be held to be invalid or unconstitutional for any reason by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this ordinance or its application to any other person or situation. Section 6. Effective Date . This ordinance or a summary thereof shall be published in the official newspaper of the City, and shall take effect and be in full force five days after passage and publication as provided by law . PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this _______ day of ____________________, 2014. ATTEST/AUTHENTICATED: Christy O'Flaherty, MMC, City Clerk Jim Haggerton, Mayor APPROVED AS TO FORM BY: Filed with the City Clerk: Passed by the City Council: Published: Effective Date: Rachel B. Turpin, City Attorney Ordinance Number: Attachment: City of Tukwila 2015-2016 Budget Total Total Fund Expenditures Revenues $125,817,778 000 General $ 125,817,778 5,703,632 105 Contingency 5,703,632 DRAFT 2,597,316 101 Hotel/Motel 2,597,316 11,081,721 103 City Street 11,081,721 35,906,080 104 Arterial Street 35,906,080 180,000 109 Drug Seizure Fund 180,000 1,415,333 200 LTGO Bonds 1,415,333 1,623,400 1,623,400 211 Limited Tax G.O. Refunding Bonds, 2008 866,315 212 Limited Tax G.O. Bonds, 2009A 866,315 1,172,100 214 Limited Tax G.O. Bonds, 2010A 1,172,100 229,800 216 229,800 Limited Tax G.O. Refunding Bonds, ValleyComm 1,095,500 217 1,095,500 2011 Refunding Bonds 226,260 218 226,260 2014 Facility 669,000 206 669,000 LID Guaranty 2,400,813 233 2,400,813 2013 LID Land Acquisition, Recreation & Park Devl. 3,902,000 301 3,902,000 10,582,204 302 Facility Replacement 10,582,204 General Government Improvements 901,000 303 901,000 550,200 304 Fire Improvements 550,200 18,422,000 401 Water 18,422,000 19,986,000 402 Sewer 19,986,000 4,181,494 411 Foster Golf Course 4,181,494 20,429,000 412 Surface Water 20,429,000 11,567,136 501 Equipment Rental 11,567,136 14,280,958 502 Insurance Fund 14,280,958 1,772,191 503 Insurance - LEOFF 1 Fund 1,772,191 1,617,300 611 Firemen's Pension 1,617,300 Total All Funds Combined $299,176,531 $ 299,176,531 City of Tukwila, Washington 2015-2016 Organization Chart CITIZENS OF TUKWILA MUNICIPAL COUNCIL MAYOR COURT MEMBERS Jim Haggerton Kimberly Walden CITY ADMINISTRATOR David Cline CITY ATTORNEY Rachel Turpin HUMAN PARKS AND FINANCE PUBLIC WORKS RESOURCES RECREATION Peggy McCarthy Bob Giberson Stephanie Brown Rick Still INFORMATION COMMUNITY FIRE POLICE TECHNOLOGY DEVELOPMENT Chris Flores Mike Villa Mary Miotke Jack Pace CITY OFFICIALS 2014 CITY COUNCIL Council President Councilmember Joe Duffie Councilmember Dennis Robertson Councilmember Allan Ekberg Councilmember Verna Seal Councilmember Kathy H ougardy Councilmember Kate Kruller CITY ADMINISTRATION Mayor Jim Haggerton City Administrator David Cline Finance Director Peggy McCarthy Community Development Director Jack Pace Parks & Recreation Director Rick Still Public Works Director Bob Giberson Interim Fire Chief Chris Flores Police Chief Mike Villa Human Resources Director Stephanie Brown Information Technology Director Mary Miotke Municipal Court Judge Kimberly Walden Contracted City Attorney Kenyon Disend, PLLC 2015-2016 ADOPTED BUDGET PREPARED BY: FINANCE DEPARTMENT PERSONN EL Finance Director Peggy McCarthy Deputy Director Vicky Carlsen Senior Fiscal Coordinator Jennifer F. Santa Ines Fiscal Coordinator Craig Zellerhoff Fiscal Coordinator Lily Jue Fiscal Coordinator Richard Takechi Fiscal Specialist Diane Jaber Fiscal Specialist Karen Fricke Fiscal Specialist Cindy Wilkins Fiscal Specialist Laurie Anderson Fiscal Specialist Joanna Fortenberry Fiscal Technician Penny Hansen CITY BOARDS AND COMMISSIONS ARTS COMMISSION Brian Kennedy Steve Mullet Trisha Gilmore Cynthia Chesak City Staff: Stephanie Gardner, Parks & Recreation Analyst Parks & Recreation Department CIVIL SERVICE COMMISSION Dennis Sivak Ronald Johnston Stephen Wheeler City Staff: Kim Gilman, Civil Service Examiner Human Resources Department COMMUNITY-ORIENTED POLICING BOARD Jun Castillo Kim Karnes Arthur Rosengren Jerry Thornton Lynn Churchill City Staff: Chris Partman, Community Oriented Policing Coordinator, Police D EQUITY AND DIVERSITY COMMISSION Kathy Hougardy Katherine Gantz Joan Hernandez Melissa Hart Nate Robinson Aaron Dragonov Crystal Sweet Thong Ung City Staff: Joyce Trantina, Project Development Manager HUMAN SERVICES ADVISORY BOARD Terra Straight Sharon Kidd Jan Bolerjack Christopher Lowrance City Staff: Evelyn Boykan, Program Manager Human Services Division Stacy Hansen, Human Services Coordinator Human Services Division LIBRARY ADVISORY BOARD Sharon Kidd Steve Miller Geraldine Ventura Linda McLeod City Staff: Stephanie Gardner, Parks and Recreation Analyst Parks & Recreation Department LODGING TAX ADVISORY COMMITTEE Council President Maureen Huffman Miesa Berry Mike Schabbing Jim Davis Mike Bush Kelly McMeckin Carol Kolson City Staff: Brandon Miles, Economic Development Liaison PARKS COMMISSION Sean Albert Alice Russel Julie Lee Don Scanlon Hassan Abdi City Staff: Dave Johnson, Recreation Superintendent Parks & Recreation Department PLANNING COMMISSION/BOARD OF ARCHITECTURAL REVIEW Louise Strander Nhan Nguyen Mike Hansen Tom McLeod Miguel Maestas Brooke Alford Sharon Mann City Staff: Wynetta Bivens, Assistant to the Director Department of Community Development SISTER CITY COMMITTEE Sharon Baker-Myklebust Audrey Davis Bonnie Mullet Patricia Timm Domenic Baker City Staff: Tracy Galloway, Parks & Recreation Manager Parks & Recreation Department CITY OF TUKWILA BACKGROUND Tukwila (whose name in local Native American dialect means "land encompasses single and multi-family residences, heavy and light companies, as well as one of the Northwest's largest concentrati prides itself with: a well-established economic base a low debt burden strong financial management City of Tukwila Details A 107 -year old community incorporated in 1908, encompassing an area of 9.7 square miles. Current population is 19,765. Mayor-Council form of government. Administered by a full-time Mayor, a seven-member City Council, and a City Administrator. All elected official terms are for a period of four years. Located in the heart of the Puget Sound region, approximately 12 miles south of downtown Seattle, 17 miles north of Tacoma, and just east of Seattle-Tacoma International airport. Additional information about the City is included in the Appendix. For the novice, the come with a wide variety of backgrounds, and include City staff, financial market experts, the information in the biennial budget information about the City to a lot of different users. The info into one of four main areas to facilitate an understanding of wh for the next biennium period. 1. A Policy Document that are under development (usually stated as goals to be accomp operates in the future, and policies tha beginning of the document, provides the background, sets the sta be accomplished during the coming budget period, and identifies in the community as identified by the City Council. New policy i highlighted in this message. All of these policy issues have the the allocation of existing staff or financial resources. 2. A Communications Device City Council has set to be accomplished during the next two fisc information about the day- to -day activities the City performs. The Budget Message provides a concise discussion of the major priorities of the City. The fin included in the detailed budget section of this document provide budget for the major priorities, but also provides a considerabl to -day activities and the resources required to meet service deman included in the detailed budget section for each fund to provide effective the City is with in pursuit of meeting City goals and 3. : The budget document is foremost a financial plan, providing a A Financial Plan map that matches resources available with the spending prioritie Council. Each operational area of the budget is comprised of spe by the budget organization charts. a. The Budget by Department: The department designation is used activities to enhance the opportunities for operational efficien professional qualifications of staff to work on multiple types o operate in just one fund, like the Finance Department operating case, the department has a fairly singular focus in its work, wi not cross into other work areas. A department can also operate i Public Works Department that operates in multiple funds, includi Sewer, Surface Water Utility Funds, and various Capital Project department has a more complex set of work tasks, but the same se a number of areas. Each department also has divisions and within anywhere from one to several programs. The program level is used work, allow the ability to cost specific services for which cust or report to the City Council, citizens, or outside agencies. nd can be found at the beginning of this document. The City uses a fund structure as th in the fund specifically associated with the kinds of expenditur there is a legal restriction on the use of the revenue in a fund revenues cannot be used to pay for street repair since the Water use to services necessary to provide water to all properties in providers. Funds are usually named for their primary activity (i arterial street infrastructure). The General Fund is used as a c defined as the fund to use when there is no reason to use anothe and expenditures which overlay the budget by fund and department. Co categories can help a reader understand how major sources of rev treated across the organization. Operating revenues include cate : sales taxes, property taxes, licenses and permits, charges for services, inte and forfeitures, and miscellaneous revenues. Non-operating reven transfers, issuance of long term debt or sale of capital assets. include: personnel services (includes salaries and wages, plus a professional services, materials and supplies, transfers, debt s operating expenditure categories include contingencies and reser but not used unless authorized by the City Council. 4. An Operations Guide every department section is a page showing the organizational structure within that department. The following p allocations for that department and provides a brief summary of Message and budget summary also serve to drive operations by tyi initiatives back to citizen needs and Council goals. The budget staff operationally as both a guide for the work plan to be acco as a comprehensive source of historical information and projecti During the course of the biennium, each department manages and m needed to the City Administrator and/or Finance Director on any Department has the overall responsibility to develop and monitor s included in Council meeting packets. The Finance Department also Annual Financial Report (CAFR) each year. BIENNIAL BUDGET PROCESS process are as follows: 1. Prior to November 1 on even numbered years, the Mayor submits a City Council. This budget is based on priorities established by provided by the City departments during the preceding months, an estimates made by the Mayor. 2. The City Council conducts public hearings on the proposed budget December. 3. The Council makes its adjustments to the proposed budget and ado balanced budget no later than December 31. 4. The final operating budget as adopted is published and distribut the following year. Copies of the budget are made available to t strategic goals and priorities followed by review of department proposals for the up improvement program document is developed in conjunction with th The biennial budget document implements the projects and priorit plan and capital improvement program. It outlines the manner in utilized during the budget period. The course the City is takin of resources. The City Council, Mayor, City Administrator, Depa residents all participate in the budget process. planning, control and evaluation process of government. It pres and the purposeful distribution of those resources. Once adopte resources will be provided to meet those objectives. City staff reviews the adopted financial policies and presents a The Council considers the proposed changes to these policies and revisions. City staff then prepares the six-year financial plan the fall and it is adopted prior to the end of the year. City staff then prepares the final estimates of revenues, expend changes. This Preliminary Budget is presented to the Council in Council discussions are held and the final budget is adopted in The adopted budget takes effect on January 1st. Throughout the ensure that funds are used in an approved manner. A few times d may be changed (amended) by Council action in an open public mee activities throughout the course of the budget period. BUDGET PROCEDURES AND AMENDMENT PROCESS The City prepares its biennial budget in accordance with Optiona Revised Code of Washington. Biennial budgeting has been permitt and allows cities to adopt a two- authority to expend funds. Traditionally, the appropriations hav for a two-year term. Currently, an annual budget means that eve context of elections for in non-election years, as the biennium must begin in odd-numbere The most common reason for using a two-year appropriation is the development and approval process. This is true of staff time in as the time Council spends during the approval and adoption phas prepare a two-year budget than one for the traditional twelve mo as significant as preparing two annual budgets. As a result, ov substantial time savings. This time savings allows staff and Co plannin g. The concept of a two-year appropriation is straightforward. Rat during which the appropriated funds can be legally spent, a bien month window. The two-year budget provides an opportunity to wi allow more long-term thinking to be part of the financial plan t there may also be concerns about spending portions of the budget been planned. For this reason, many cities have adopted variati The requirements for preparing an annual budget and a biennial b - make adjustments to the budget or essentially, a tune up. This another complete budget process in itself. The mid-biennium rev and is to be st completed by the end of the first year of the budget. 2013 Council and Executive Team held first workshop to determine potential 2015- 2016 priorities. Admin Team and consultant refined 2015- 2016 priorities. 2014 Council held retreat to refine 2015-2016 priorities. Council and Executive Team held second workshop to finalize 2015-2016 priorities. Forum held to engage community. 2013 accomplishments were reported and feedback on 2015-2016 priorities was gathered. 2015-2016 priorities were discussed with staff. Department staff presented 2015-2016 proposals to Admin Team. Admin Team reviewed all proposals. Budget files were made available to staff. Budget presentations were heard, preliminary decisions on proposals, increases were made. Budget files were due to Finance department. Council was briefed on budget process. Community updated on budget process, priorities. Finance department compiled and refined draft budget. Admin Team reviewed and refined draft budget. Mayor presented preliminary budget. Budget workshops were held throughout the month. Public hearing held. Property tax levy set by ordinance. Budget and CIP adopted by ordinance and resolution. 2015-2016 Budget Calendar Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 Final budget published and distributed. Instruction packet for mid-biennial review and modification distributed to Departments. Departments review budgets and prepare budget modifications. Department Directors return budget modification requests to Finance. Departments review budget modifications with the Mayor and City Administrator. Budget modifications adjusted based on Mayor's recommendations. Department budget modification requests are reviewed by Council Committees. Notice of public budget hearing #1 on proposed budget modification is published. Proposed budget modification is filed with the City Clerk, distributed to City Council and made available to the public. Public budget hearing #1. Notice of public budget hearing #2 is published. Public budget hearing #2 is held and property tax levy is set by ordinance. Council/Mayor Work Session on budget recommendations. CIP Amendment and Mid-biennial budget modification are adopted by ordinance. 2016 Mayor and Council budget retreat to update the vision for the City. Mid year Budget Amendment is adopted by ordinance if necessary. Year-end Budget Amendment is adopted by ordinance, if necessary. BUDGET DEFINITIONS The City Council authorizes transfers within funds and must appr that increase the total for the fund. Budget amounts presented i both the original amounts and the final amended budget as approv Expenditure categories are identified in the following: Salaries and Wages Wages for full-time and part-time employees, overtime, and extra short-term needs of the City. Personnel Benefits includes all mandatory and negotiated benefits for all City staf Supplies includes items used for day- to -day operations and small tools that do not meet the capitalization threshold of the City... Services includes professional and contracted services, utilities, insura accomplished by outside vendors. Intergovernmental charges paid to other government agencies including jail costs, police, interfund taxes due from enterprise funds to the general Capital includes all items purchased that meet the capitalization thresh and utility projects within the City. Budget and Accounting System and accounting system at a very detailed line item level. Compu any time and at various levels of detail. Departments can also read-only inquiry basis to compare actual revenue and expenditur computerized budget becomes the accounting system that controls final budget. Pr eliminary Budget the City Council. This public document contains a summary of in the General Fund at the department level. It focuses on key pol comprehensive overview of the complete budget. Budget Ordinance The actual appropriations implementing the budget are contained the City Council. Final Budget The Final Budget is issued as a formal published document as mod document which is formally filed as the Final Budget. Programs While the budget proposals of the administration are developed i the budget, the budget documents themselves only summarize the i performance measures. Generally, these programs are not finaliz since the budget will determine the actual activities undertaken Components of the Budget The budget consists of two parts: operating budget and capital b Operating Budget The operating budget consists of departmental budget proposals, maintain the objectives set by the departments to meet Council g Capital Budget The capital budget authorizes and provides the basis of control significant city assets and construction of capital facilities. Separation of the budget into these two components separates key their consideration. The policy officials can examine the level funded, what program improvements should be made and at what lev Capital Planning The Capital Improvement Program (CIP) was originally adopted as ans to finance capital facilities that will be needed during the next 20 years. The CIP includes both long-range stra projects. The CIP is maintained and reports are published separ Budget, in this budget document, includes a summary of the proje upcoming biennium. For more detailed information see the Financ Improvement Program. Implementation, Monitoring and Amendment The financial aspects of the budget are monitored in periodic re comparing actual expenditures and revenues with the budget. In presented at a higher level of detail than the final budget. Th From time to time it becomes necessary to modify the adopted bud the budget depends upon the type of change that is needed. One -item to presented by administration to City Council for their considerat The second type of budget amendment brings about a change in the department or fund. Examples of these changes include but are n acceptance of additional grant money, an adjustment to reflect i the appropriation of additional funding if expenditures are proj re -appropriation of monies from one fund to another when deemed ne council approval in the form of an ordinance. The status of the during the mid-biennial review and periodically through each yea All requests for amendments are first filed with the Finance Dep Basis of Budgeting All governmental fund type budgets are prepared on the modified conformity with generally accepted accounting principles (GAAP). prepared on an accrual basis, also in accordance with GAAP. The where expenditures cannot exceed appropriations is at the indivi the total expenditures of any fund must be approved by the City budget, as adopted biennially by the City Council, constitutes t that level of detail. FUND DEFINITIONS ensure legal compliance and financial management for various res expenditures. Fund accounting segregates certain functions and funds created and maintained for specific purposes (as described The City of Tukwila budget is organized in a hierarchy of levels A fund is an accounting entity used to record the revenues and Fund governmental unit which is designated for the purpose of carryin or attaining certain objectives. For example Fund 104, the Arter designated for the purpose of maintaining the arterial streets w A department designates a major function of City operations, e. Department and Recreation. A specific distinguishable line of work performed by the depart Program The appropriation unit (object of expenditure) is the level of Object sort and summarize objects of expenditure according to the type being purchased, e.g., salaries, supplies. FINANCIAL STRUCTURE OF THE CITY BUDGET The following are the fund types budgeted by the City and other Governmental Fund Types General Fund The General Fund supports the general operations of the City gov administration, the legislative function, legal services, public development, enforcement of local codes, parks, recreation, and principal source of revenue for the General Fund: property, sale es . Other important sources are shared revenue from other governments, lic services, and fines and forfeitures. The General Fund accounts which a specific fund has been created. The Contingency, or Reserve Fund, is an accumulation of fund bal previous year General Fund revenue, exclusive of significant non this fund can be used for more restrictive, emergency type purpo general fund. Special Revenue Funds Special Revenue funds are used to account for revenues which are for special purposes. These funds receive revenue from a variet State grants, taxes, and service fees. These revenues are dedic individual special revenue fund. There are two Special Revenue Hotel/Motel Tax, and Drug Seizure. Debt Service Funds These funds account for resources necessary to pay principal and Debt limits are based on percentages of assessed valuation, with the city electorate. Tukwila has a Limited General Obligation bond rating of AA- with Capital Projects Funds These funds are used to account for financial resources to be us including those financed by special assessment, major improvemen capital funds consist of contributions from operating funds and usually dedicated to capital purposes and are not available to s are adopted on a multi-year basis. Currently the City has six a Streets, Bridges & Arterial Streets, Land Acquisition, Recreatio Replacement Fund, General Government Improvements, and Fire Impr Proprietary Fund Types Enterprise Funds are used to account for operations that are fi Enterprise Funds in a manner similar to business enterprises. They are establish with revenues provided primarily from fees, charges, or contract Enterprise Funds to account for the operations of Water, Sewer, Reserves and Golf Course. Internal Service Funds are used to account for operations simil Internal Service Funds accounted for in Enterprise Funds, but these funds provide goods cost reimbursement basis. The City maintains three Internal Ser management and self-insurance activities. Fiduciary, or Trust Funds, are used to account for assets held b Fiduciary Funds investment trust, private-purpose trust, and agency funds. Th recognized when earned and expenses are recorded when incurred. FINANCIAL PLAN Introduction The National Advisory Council on State and Local Budgeting (NACS revenue and expenditures in their Recommended Budget Practices. a combined view of both past and anticipated future revenues and focuses analysis on revenue sources in order to inform users of the services it provides to its citizens. A table, graph and exp the General Fund, Special Revenue funds, Capital Projects funds, funds, and Fiduciary funds. This is followed by a six-year forec with a discussion of the factors that affect the forecast. Long well as the General Fund fiscal capacity. This chapter ends with working capital balances. community needs in both the present and future. The development and allocation the basis of the foregoing policies, goals, and objectives addressing the requirements and needs of the City of Tukwila. While the other sections of this document will section provides an overview of the budget as a Financial Plan. strategies to maintain its financial strength and the basis for affecting 2015-2016 are summarized under the Capital Budget sect Capital Improvement Program (C IP ) is outlined, in detail, in a separate document. A six- governmental fund revenues and expenditures follows this summary The purpose of the forecast is to highlight issues associated wi decisions. It is not intended to be a multi-year budget. Revenues and expenditures are projected on the basis of assumed are forecast on the basis of future economic and demographic fac Expenditures are forecast based on past trends modified by present and future conditions. Futur assumptions. This model has been used to test a large range of course of developing budget recommendations. Forecasting models have been used to assist in fiscal planning f allowed analysis of alternative actions in funding programs duri The model accents the continuing need to control the per capita preceding pages. Continued caution will be required to anticipa and future legislative actions to avoid service reductions for b slower than anticipated the adverse effect on fund balance may b As mentioned, the City takes into account the statewide initiati issue that develops when property tax increases for existing imp is that costs cannot be held to the same 1% increase. Costs suc contracts, services and supplies continue to increase at a great healthcare costs are good examples. The shortfall then has to b collection and population growth. The City has been able to mai light of legislative action, because the economy is growing at r on property taxes. Sales tax revenue needs to grow at a rate tha property tax declines. If not, the City will then have to make basic levels of services. This page intentionally left blank