2007 0917 Special City Commission Meeting - Budget

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- Summary Minutes: Special City Commission Meeting September 17,2007 First Budget Hearing Sunny Isles Beach, Florida Action: City Manager Szerlag reported noting that we wilJ have a number of components tonight, one is a recap and a sl ight recalibration of the initial power-point that was presented at the last workshop. He said we also have Addenda that updates the current budget document, and we would also like to include organizational positives/accomplishments that we performed throughout the year. City Manager Szerlag did a power-point presentation on F iscal Year 2007/2008 Budget He said the challenges that face us as welJ as other municipalities are that we have a loss of Home Rule that is becoming eroded almost yearly, there are property tax reductions and limited growth in the future. He said we are fortunate in Suuny Isles Beach to still have growth but there is going to be a point where we are essentially built-out and the revenues that we once enjoyed from new construction are being diminished. He said there may be further reductions in Fiscal Year 2008/2009 depending upon what the Legislature does in January, and we will also have increased operating costs for new programs and facilities. City Manager Szerlag said our initial impact is we reduced Operation and Maintenance (O&M) expenditures by approximately $2.9 Million Dollars, however, we did have Proposed start -up costs and other changes that added about $1.5 Million Dollars into the O&M Budget He said we are going to be going on line with the Community Center and at that point we are having a modified start-up, we are not having an entire cost this coming Fiscal Year but we are easing into it in some respects in tenus of OUr O&M costs. He said we are either going to have our opening ceremony sometime in November or the first weekend in December. In tenus of Wireless Island, we are now methodical in our approach, essentialJy there are three tiers: Government Access Hotspots, street level penetration, and verticality, and we are going to try to achieve SUccess in one area before going to the next, and our reduced budget numbers reflect that. City Manager Szerlag also reviewed Fiscal Year 2006/2007 Budget revenues which are higher by $2.4 MilJion DolJars, expenses which are lower by $3.8 Million DolJars, and fund balance with an increase of $6.2 Million DolJars for a total estimated fund balance, as of September 30,2007, of $17.5 MilJion DolJars. He said this is because we have a fiscal conservative approach to budgeting whereby we tend to overestimate our expenditures and underestimate our revenues, the money does not evaporate and with that philosophy we have monies going into the General Fund on a yearly basis. City Manager Szerlag reviewed Fiscal Year 2007/2008 Budget revenues which are proposed at $26.9 Million Dollars, as well as our expenses because we have to have a balanced budget He said that number includes a transfer of $5 MilJion Dollars to the Capital Improvement Fund for proj ects as welJ as a $212,434.00 usage of fund balance asrevenue to balance our budget He said the proposed milJage rate is now 2.3979 milJs, which is a decrease of I 9% from last year's rate of 2.9500, this rate reflects the maximum cap and rolJback effect of the new legislation referred to now as the maximum millage. The effect of that essentially is a BilJion Dollar increase in total property valuations last year provided additional revenues of $2.8 Million DolJars, and this year a $1.5 Billion Dollars increase in valuation only provides about $653,000 in additional revenues. 2