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HomeMy WebLinkAboutFIN 2019-04-22 COMPLETE AGENDA PACKETCity of Tukwila Finance Committee • Thomas McLeod, Chair • Verna Seal • De'Sean Quinn AGENDA MONDAY, APRIL 22, 2019 — 5:30 PM HAZELNUT CONFERENCE Room (At east entrance of City Hall) Distribution: T. McLeod V. Seal D. Quinn K. Hougardy D. Robertson K. Kruller Z. Idan Mayor Ekberg D. Cline R. Bianchi C. O'Flaherty L. Humphrey Item Recommended Action Page 1. PRESENTATION(S) 2. BUSINESS AGENDA a. A briefing on the new cashiering system. a. Discussion only. Pg.1 Aaron Williams, Fiscal Manager b. February 2019 departmental budget-to-actuals report. b. Discussion only. Pg.3 Jeff Friend, Fiscal Manager c. An update on the transition of business licensing to the c. Discussion only. Pg.9 State. Vicky Carlsen, Finance Director 3. MISCELLANEOUS 4. ANNOUNCEMENTS Next Scheduled Meeting: Monday, May 13, 2019 46. The City of Tukwila strives to accommodate individuals with disabilities. Please contact the City Clerk's Office at 206-433-1800 (TukwilaCityClerk©TukwilaWA.gov) for assistance. City of Tukwila *ILA 0 INFOR ATIONAL E ORANDU TO: Finance Committee FROM: Vicky Carlsen, Finance Director BY: Aaron Williams, Fiscal Coordinator CC: Mayor Ekberg DATE: April 22, 2019 SUBJECT: Briefing on new cashiering system Allan Ekberg, Mayor ISSUE Update the Finance Committee on the implementation of Tyler Cashiering, the new cashiering system for the Finance Department and City Clerk's office. BACKGROUND The point of sale cashiering system used by the Finance Department and the City Clerk's office, Core Cashiering, was purchased and implemented in January 2009, almost ten years ago. In recent years, consideration has been given to purchasing a new cashiering system because the existing system functions slowly and system support and upgrades have been discontinued by the vendor. In June 2018, the need for a new system became more urgent. The Payment Card Industry (PCI) standards became more stringent requiring a more secure encryption protocol — Transport Layer Security (TLS) 1.2 - effective June 30, 2018. Because the Core Cashiering system did not comply with this protocol, a work around was developed by the City's TIS Department to achieve compliance. Under the TIS-developed solution, credit card transactions are processed using a two-step method. First, the credit card payment is processed using an online terminal. Next, the transaction is recorded into the Core Cashiering system by entering the last four digits of the credit card, the credit card expiration date, and the transaction authorization number from the online credit card terminal. This solution solved the immediate problem but proved to be a very time-consuming process. At the November 5, 2018 City Council Regular Meeting, Council authorized the purchase of the new cashiering system, Tyler Cashiering. DISCUSSION Implementation and go -live for Tyler Cashiering was the week of March 11th with the system going live on the morning of Thursday, March 14th. The three days prior to go -live, staff from Finance, City Clerk, TIS and Police worked with the vendor to configure and train on the new system. Tyler Cashiering has an intuitive, user friendly interface which provides a more streamlined experience with a direct integration into Eden, has the ability to run on laptops (in addition to the cashiering stations) and ultimately improves efficiencies. In the past month since implementing the new cashiering system, staff have noticed significant improvements in their processing of transactions, closing & balancing batches as well as reporting and researching transactions within the system. 1 INFORMATIONAL MEMO Page 2 This new cashiering avotern provides real-time processing for utility peynlante, which has allowed staff to see all payments applied to customer accounts immediately (especially helpful during shut-off times). With the old Con* Cashiering systann, payments would not have been reflected on the customer accounts until after the payment batch was closed, processed and imported into Eden. One of the most noticeable improvements has been with credit card processing, which no longer requires processing, and has been a welcome improvement for both city staff aewell ma the public. Credit card payments are now more secure and the city io|ncompliance with the more stringent Payment Card Industry (PC|)standards. Check processing has also become more efficient with the new system. The receipt printers include functionality which a||ovVa for automatic endorsement and check image capture. In the coming n1ontho. Finance staff will be evaluating the use of the cash image letter function which will transmit all check deposits directly to the bank. This will provide more timely daily deposits and increase the city's average daily balance with the bank which will lower bank fees. LasUy, with the Tyler C@ahiehng, staff can log into the cashiering system from their ovvO workstations and no longer must use one of the cashiering stations at the counter tQ'access the system. With this feature the Police Department is able toutilize the cashiering system toprocess payments related to the secure mailbox program without needing to send the customer over the Finance and then come back toPOinorder tocomplete their transaction. T|Sand Finance plan to work together to identify other opportunities to expand Tyler Cashiering to other departments in the future. RECOMMENDATION For information only. City of Tukwila INFOR ATIONA E TO: Councilmembers CC: Mayor Ekberg FROM: Vicky Carlsen, Finance Director BY: Jeff Friend, Fiscal Manager DATE: April 9, 2019 SUBJECT: Year -to -Date February 2019 Financial Update Summary ORANDU Allan Ekberg, Mayor The purpose of the February 2019 Financial Report is to summarize for the City Council the general state of departmental expenditures and to highlight significant items. The following provides a high-level summary of the departmental financial performance. The February 2019 Financial Report is based on financial data available as of April 8, 2019, for the period ending February 28, 2019. Additional details can be found within the attached financial report. Departmental Expenditures General Fund expenditures totaled $11.84M through February, which is about $556K below the allocated budget of $12.4M. The allocated budget is calculated to reflect year-to-date spending patterns of the previous year. Snowstorms During the month of February, the City experienced two winter snowstorms. Unbudgeted overtime and supply costs incurred by the General Fund directly related to the snowstorm were as follows: Department Overtime and Benefits Supplies Combined Police $ - $ 143 $ 143 Fire 30,313 285 30,598 Public Works - 286 286 Park Maintenance - 452 452 Street Maintenance and Operations 19,463 8,887 28,351 Total $ 49,777 $ 10,053 $ 59,829 3 INFORMATIONAL MEMO Page 2 Departmental Variances Twelve of fourteen General Fund departments were under their allocated budget through February 2019. Major variances are: • Police was $237K under budget through February primarily due to Salaries, Overtime, and related Benefits being under budget by $150K, $40K, and $80K; respectively, while supplies were $32K over budget. As discussed in the January report, the department has had a few open positions while new employees have filled positions at a lower pay level than that of the employees who were employed during last year's budget process. Purchases of equipment for new employees resulted in Supplies being over budget in February. • Public Works was $86K under budget through February primarily due to some vacant positions. The vacancies resulted in Salaries and Benefits being under budget $40K. Public Utilities was also under budget $35K due to the timing of utility invoice payments. Administrative Services was $73K under budget through February due to two vacant positions (Community Engagement Manager and Human Resources Technician) as well as Professional Services being under budget. The position vacancies resulted in Salaries and Benefits being under budget $42K. The Human Resources Technician position was filled in mid -February while the Community Engagement Manager position was filled in March. Now that the Community Engagement Manager has been hired, an increase in service program costs reported under Professional Services is expected to increase. Fire is $88K over budget. Salaries and Benefits were $156Kcover budget resulting from 1) filling four unbudgeted pipeline positions and 2) overtime costs that were $70K over budget through February. (As stated above, $30K of overtime was related to the two snow events in February.) Services and Supplies were under budget by about $67K partially offsetting the amount the department was over budget on Salaries and Benefits. Analysis is being performed to determine options for addressing the department's operating cost issues. These options will be presented to the Finance Committee in May. Street Maintenance and Operations was $34K over budget through February primarily due to Overtime and Supplies costs related to the snow events. Overtime was $25K over budget while Supplies were $28K over budget. These amounts were partially offset by Public Utilities being $17K under budget due to the timing of utility invoice payments. 4 INFORMATIONAL MEMO Page 3 Year to Date Department Expenditures Compared to Allocated Budget (Through February 2019) City Council S60 • 565 Mayor Administrative Services Finance Attorney S4 Recreation Community Development Municipal Court Police Fire Technology & Innovation Svcs Public Works Park Maintenance Street Maintenance & Operations Dept 20 $0 $364 $411 219 293 $678 $469 $530 $527 $554 $192 $208 271 $307 $348 $380 $500 5728 $660 $747 $1,000 $1,282 $1,251 $1,350 $1,350 $1,500 $2,000 YTD Actual illYTD Budget $2,247 $2,158 $2,500 $3,000 $3,177 $3,414 $3,500 $4,000 Thousands 5 INFORMATIONAL MEMO Page 4 GENERAL FUND CITY OF TUKWILA GENERAL FUND EXPENDITURES YTD AS OF FEBRUARY 28, 2019 SUMMARY OF EXPENDITURES BY DEPARTMENT BUDGET ACTUAL COMPARISON OF RESULTS 2019 2019 ANNUAL ALLOCATED 2017 20f8 20 ACTUAL OVER/(UNDER) °lo CHANGE ALLOCATED MGT % EXPENC D 201712018 2018/2019 01 City Council 432,111 64,671 58,828 58,476 59,842 (4,829) 14% (1)% 2% 03 Mayor 2,595,514 410,741 385,269 407,646 363,793 (46,948) 14% 6% (11)°fo 04 Administrative Ser ices 2,111,509 292,890 270,034 249,794 219,056 (73,834) 10% (7)% (12)% 05 Finance 2,671,195 727,877 712868 634,862 677709 (50,169) 25% (11)% 7% 06 Attorney 710,730 3,994 46,449 1,743 665 (3,328) 0% (96)% (62)% 07 Recreation 3,294,138" 530,279 473,969 469,729 469,212 (61,067) 14% (1)°fa (0)% 08 Community Development 3,511,558 554,424 505,359 500,579 527,009 (27,415) 15% (1)°fa 5% 09 Municipal Court 1,298,228 207,832 185,967 203,122 191,711 (16,122) 15% 9% (6)°fa 10 Police 19,427,613 3,413,570 3,017,119 3,113,670 3,176,565 (237,005) 16% 3% 2% 11 Fire 12,473,387 2,158,213 2,107,444 2,059,503 2,246 655 88,442 18% (2)% 9% 12 Technology& Innovation Svcs 2,043,934 306,868 201,998 290,907 270,546 (36,322) 13W 44% (7)% 13 Public Works 3,948,613 747,020 660,324 663,098 660,404 (86,615) 17% 0% (0)% 15 Park Maintenance 1,630,586 379,607 256,505 261,306 348,008 (31,598) 21 % 2°1 33% 16 Street Maintenance & Operations 3,354,733 1,250,809 738,308 744,576 1,282,090 31,281 38* 1% 72% Subtotal 59,503,849 11,048,794' 9,620,442 9,659,009 10,493,265 (555,529} 18°k 0°fo 9°lo 20 Dept 20 19,067,819 1,350,000 50,000 2,050,000 1,350,000 7% 4000°,4 (34)% Total Expenditures 78,571,668 12,398,794 9,670,442 11,709,009 11,843;265 (555,529) 15°/ 21% 1% Frcent of year completed 17% 6 INFORMATIONAL MEMO Page 5 GENERAL FUND CITY OFTUKWILA GENERAL FUND EXPENDITURES YTD AS OF FEBRUARY 28, 2019 BUDGET ACTUAL COMPARISON OF RESULTS SUMMARY OF SALARIES AND BENEFITS 2019 ANNUAL 2019 ALLOCATE) 2017 2018 ACTUAL OV E /(UNDER) %CHANGE. 2019 ALLOCATED EDT % EXPEND 7 2017/2018 2018/2019 11 Salaries 28,891,480 4,815,247 4,497,579 4,521,543 4,608,338 (206,908) 16% 1% 2% 12 Extra Labor 762,833 113,485 79,487 81,481 97,922 (15,563) 13% 3% 20 13 Overtime 1,350,099 214,844 286,821 220,522 272,001 57,157 20 % (23) % 23% 15 Holiday Pay 504,517 104 489 97 3,891 3,786 1% (80)% 3930% 21 FICA 2,107,153 351,192 290,651 296,020 296,589 (54,603) 14% 2% 0% 22 Pension-LEOFF 2 922,206 153,701 133,423 138,003 139,809 (13,892) 15 % 3% 1% 23 Pension-PERS/PSERS 1,751,656 291,943 239,905 279,347 284,940 (7,003) 16% 16% 2% 24 Industrial Insurance 861,417 143,570 95,951 96,455 162,286 18,716 19% 1% 68% 25 Medical & Dental 5,998,564 999,761 935,400 923,300 943,627 (56,133) 16% (1) % 2% 28 Uniform/Clothing 8,525 1,431 630 1,030 235 (1,196) 3% 63% (77)% Total Salaries and Benefits 43,158,450 7,085,277 6,560,809 6,574,418 6,809,637 (276,640) 16% 0% 4% SUMMARY OF SUPPLIES, SERVICES, AND CAPITAL BUDGET ACTUAL COMPARISON OF RESULTS 2019 ANNUAL 2019 ALLOCATE) 2017 2018 2019 ACTUAL OVER (UNDETi) % CHANGE ALLOCATED BOOT % EXPENDED 2017/2018 2018/2019 0 Transfers 19,067,819 1,350,000 50,000 2,050,000 1,350,000 - 7% 4000 % (34)% 31 Supplies 1,072,087 155,072 165,801 138,545 200,807 45,735 19% (16)% 45 % 34 35 Items Purchased for resale Small Tools 22,000 163,569 - 15,296 69 16,060 - 11,144 - 4,528 - (10,767) - 3% _ (31)% (59)% 41 Professional Se s 6,404,856 712,538 211,216 191,973 596,053 (116,484) 9% (9)% 210% 42 Communication 434,600 63,592 40,100 55,448 57,861 (5,730) 13% 38% 4% 43 Travel 159,630 29,923 30,554 28,622 22,886 (7,037) 14% (6) % (20) 44 Advertising 47,550 5,060 4,237 3,796 1,539 (3,521) 3% (10)% (59)% 45 Rentals and Leases 2,901,035 497,138 355,612 351,180 468,793 (28,344) 16% (1) % 33 % 46 Insurance 1,005,775 996,081 880,875 967,328 883,280 (112,801) 88% 10% (9)% 47 Public Utilities 1,999,424 1,132,538 581,973 602,659 1,069,128 (63,410) 53 % 4% 77% 48 Repairs and Maintenance 623,150 189,646 117,078 32,316 191,581 1,935 31% (72)% 493% 49 Miscellaneous 1,271,723 165,601 183,778 208,617 181,459 15,858 14% 14% (13)% 51 Inter -Governmental - - 462,269 488,066 5,574 5,574 - 6 % (99) % 53 ExtTames, Oper. Assess - - 16 85 136 136 - 423 % 60 % 64 Machinery & Equipment 240,000 1,033 9,995 4,812 - (1,033) - (52)% - Total Supplies, Services, and Capital 35,413,218 5,313,517 3,109,633 5,134,592 5,033,628 (279,888) 14% 65% (2) % Total Expenditures 78,671,668 12,398,794 9,670,442 11,709,009 11,843,266 (555,529) 15% 21% 1% Percent of year completed 17% 7 8 City of Tukwila J'r 4d, INFOR ATIONAL E ORANDU TO: FROM: Vicky Carlsen, Finance Director CC: Mayor Ekberg DATE: April 17, 2019 SUBJECT: Update on transitioning business licensing to the State ISSUE Update the Finance Committee on transitioning the business licensing function to the State. Allan Ekberg, Mayor Finance Committee BACKGROUND Engrossed House Bill 2005 passed unanimously in 2017. The bill, now codified as Chapter 35.90 RCW, requires any city with a general business license, to partner with a combined licensing service. At the November 9, 2018 Regular Meeting, Council authorized the Mayor to sign an interlocal agreement with the State of Washington Department of Revenue for business licensing services. The purpose of the agreement was to establish the terms under which Revenue's BLS work unit would act as the City's agent for the purpose of collecting, processing and disbursing information, licenses and fees related to the City's general business license activities. The City retains all power and authority over its business licensing and other regulatory activities except as expressly delegated in this agreement. The date for transition was set for March 28, 2019 DISCUSSION A communications plan announcing the change was prepared and implemented prior to the transition. Outreach to the business community included the following: • Postcard mailed to all Tukwila businesses • Letter mailed to all Tukwila businesses •Website updated with information about the transition *Posts on social media *Outreach to the Chamber *Article in E-Hazelnut In addition to outreach to the business community, Finance also installed a kiosk at the front counter that will allow businesses to access the State site and apply and/or renew their business license while still onsite. The kiosk can also be used to pay a utility bill. Additional features, including the ability to apply for a job, will be added in the future. As mentioned above, the transition occurred on March 28, 2019. Training on the new system occurred the week of, and the week after transition. 9 INFORMATIONAL MEMO Page 2 The City benefits from this partnership iDseveral ways. Staff resources can beallocated from the renewal and fee collection function tQauditing licensing data. Staff will also have access to more data oneach business licensed in the City 'including: wState licenses compared toTukwila licenses • Other endorsements * Location codes for sales tax reporting * Revenue * Monitored alarms As nanev«a| time for business licenses approaches in the fall, the City will again reach out to our business community with information on renewing with the State. RECOMMENDATION Information Only. ATTACHMENTS Postcard mailed toall Tukwila businesses 10 Please take note: Important information about your Tukwila business license In accordance with a new state bv4 the Washing- ton DepartrnentofRevenue'sBusinessLicensing Service (BLS) wit[ handle processing ofall City nfTukwila busi- ness |icensesandrenevvais'efhecUveMarch28,2UI9. Registering with the City ofTukwila through the Business Licensing Service - Our partnership with BLS will allow you "one'stopshopping" when maintaining orrenewing many of your state and City licenses. New orexpanding businesses will beable toapply for their City license on[ nealong with other state and local licenses that partner with BLS. kWhutdo/hovetodo? Nothing right now, ifyouhave an existing business license. About six weeks before your current license expiration date, BLS will send you a license nznevva( letter with instructions on how to renew your City ofTukwila business license. You may use E'checkorcredit card tomake payment for online transactions. Prefer torenew your license bymail using the BLS renewal form? Please dosoinplenty nftime toreach BLS before the expiration date, and include acheck made out 1oDORfor the appropriate amount. A[ate filing fee wit( beassessed for renewals received after the expiration date. CITY OFT0KWILA 62003ouUhcenterBoulevard Tukwila, WA 98188 Doing business in Tukwila? A change is coming to ho0/you 'it renew your business license! Please read important information on other side What /f/don't have obusiness license/ |fyouare operating abusiness inthe City ofTukwila without a license, you are required toapply for one. Until March l5'2Ol9'this must bedone inperson bycoming tnCity Hall at620OSouthcenterBoulevard. Businesses found operating without alicense are charged additional fees and penalties. Nhotfees will/ have topay? For renewals, you will still pay the City ofTukwila license fee, which isbased on your part-time and full-time employee count. There will be a minimal processi-n5fee assessed by the DORto help cover BLS processing costs, aswelt asthe printing and mailing ofrenewals and licenses. Duyou have questions? For more information about this new process, visit the BLS websiteatBLS.DOR.VVA.gov orcall BLS atI'80O'45I'79O5. You can also contact the City ofTukwila for additional information by calling 2U6'433I83Soremai(ingFinance@Tukm/i\aVVA.gov. Finance staff members are available atCity Hall tm assist with navigating the BLS vvebsiteifneeded. PR5RTS0 U.S. Postage PAID Olympic Mailing Services 11 12 Allan Ekberg, Mayor Finance Department Peggy McCarthy, Director — Dear Tukwila Business: TheCitynfTukv«laconstantlystrivestpmaintoinacompetitiveemvirnnmentinwhichourbusinessescanoperate. We work hard to balance the City's revenue needs with the ability of business to compete in the local, regional and _global economy. This letter is to inform you that starting in 2019 the City will be raising the business license fees. The decision to raise these fees came after significant public outreach and discussion with the City Council. The City met with dozens of businesses, provided notice toall business operating in the City, conducted a public open house, and solicited public testimony atmultiple City Council meetings. |nresponse tppublic input, the City decided tophase in the fee increase over two years. The table below shows the two-step fee schedule. BUSINESS LICENSE FEE 2018 2019 202 _ Per full-time employee _ '� Per part-time employee Prior toenacting the business license fee increase, the City reduced its expenditures for supplies and services by 3Y6in2018. In addition, budgeted supply and service expenditures for 2019-2020 were reduced by an additional 396for all City departments, except for Police and Fire which were reduced byl.Sy6. The business license fee increase plus our spending reductions allow the City to retain essential public services. More than 6096 of the [1ty'sGenera| Fund goes to Public Safety. The City has traditionally relied on sales tax for a significant source nfits revenue. However, due to changing buying patterns, the City has started tosee sales tax growth flatten. Additionally, several years ago the State of Washington changed the method in how sales tax is distributed to jurisdictions ("Stveano|inedSales Tax''). In the past, sales tax revenue was awarded based on the where the sales transaction occurred. Now the tax revenues are awarded based on where the customer takes delivery. This change resulted in the City of Tukwila losing substantial revenues. At the time of the change, the State enacted Streamline Sales Tax mitigation payments for municipalities such as Tukwila that were hard-hit by the change in revenue distribution. However, last session the Legislature voted to end these payments, which will result in a revenue loss to Tukwila nf$1.I million per year starting inZOZ0. The City has limited revenue options and ultimately prioritized retaining a high level ofservice for visitors, residents and guests. VVeappreciate your presence asamember ofour community. |fyou have any questions, please call Cindy Wilkins atZ06'431'36DOoremail [indy.VVi|kins@Tuhwi|aVVA.gov. Tukwila City Hall ^G20qSout6cenferBoulevard ^ Tukwila, WA 98188 ~ 206'433-2800 ^ Nebs/te: 13 14