budget presentation 2017-2018 · highlights, future issues, outlook. 2017-18 budget proposal 2 one...

City of Huntington Woods2017 – 2018 Budget

Presentation

Highlights, Future Issues, Outlook

2017-18 budget proposal 2

▪ One additional full time personnel budgeted in Recreation.

Huntington Woods 2017-18 BudgetProposed Budget - Highlights

▪ City is in negotiations with Public Safety Officers. The City is seeking changes to pension benefits for new hires

▪ Pension liability continues as an issue. The City will contribute additional $$ in 2017. Funding level is at 58%

▪ The City has updated its OPEB actuary and will contribute 1% of the UAL in 2017. Currently the City is 5% funded.

▪ 2017 fund balance appropriation is $187,000. or 2% of the budgeted expenditures.

▪ Current budget calls for same levels of service.▪ 2017 new road debt was added. Small debt millage to

reflect bond sale. Construction planned this summer and in 2018.

“The Budget Brief”


▪ Road Construction to continue through 2020. No further roadway construction is planned past that date.

Huntington Woods 2017-18 BudgetProposed Budget Highlights

▪ Consumer water rate will increase 3.5% to $12.50/unit. Quarterly capital fee remains at $17.00 Water usage has stabilized at last years’ level.

▪ Sewer cleaning to be complete this summer. Monies have been budgeted for engineering sewer repair program development in 2017-18. Sewer repairs have been projected at $15 Million. Funding methods will be reviewed once all data has been compiled and the scope of the project is identified.



▪ (True Cash) housing values rose 8.30% slightly less than last year. Still indicative of a strong housing market.

▪ TV increased by 3.60% - CPI inflation rate rose <1%.▪ State Shared Revenue is substantially unchanged

projected to increase 0.48%. ▪ Major increases in Major and Local Act 51 Gas tax

distribution due to the impact of the new state gas tax. ▪ The remaining Headlee over-ride cushion is reduced from

.6837 mills in 2016 to .5711 mills this year, equal to $195,000 in revenue if levied in its entirety.

Huntington Woods 2017-18 Current Economic Data and Estimates


▪ The total tax levy will increase by 3.49% equal to approximately $110.00 for the average HW home.

▪ The Administration will ask the City Commission to convene a Blue Ribbon Committee to study projected revenues and expenditures and offer recommendations for long term stability.

▪ Huntington Woods Is hosting a MML presentation “SaveMiCity” to highlight the broken municipal funding model and to explore alternatives.


“The Budget Brief”Huntington Woods 2017-18 Current Economic

Data and Estimates


Uncaptured Assessed Value Values almost identical


290

310

330

350

370

390

410

430

450

470

201620152014201320122011201020092008

MIL

LIO

NS

Assessed Value Taxable Value

Statutory Taxation Conundrum Facing Michigan Municipalities



▪ Administration:▪ Status Quo - No change in service levels at City Hall. Multiple duties handled

by a very small staff.

▪ Public Safety:▪ Significant change in departmental staff dynamics with the institution of

Sergeant position. The new Command structure has been put in place in an effort to reduce the overtime costs. Union negotiations will begin this spring.

▪ Library:▪ No change in staffing levels anticipated. The Library will maintain all operations

with TLN.

▪ DPW:▪ The DPW will be in a rebuilding mode with key staff retirements. The City will

concentrate on maintenance and sewer cleaning either on an in-house or contracted basis.

Operating Budget Overview:



▪ Recreation:▪ One new FT employee is budgeted having transitioned from PT status. The

Recreation Center will focus on expanded program offerings and the implementation of the new recreation software, including work on a Web-based approach to registration. Costs are substantially unchanged from last years’ budget. The General Fund provides 41% of the Recreation Department budget with 51% coming from Recreation program revenue. Only 3.31% of revenue is from the small millage for maintenance.

▪ Program expenditures equal 59% of all recreation expenses and 33.5% are allocated to Administrative functions. In 2017 the recreation fund will require $97,000 from fund balance for operations, therefore the goal in 2017 will include a focus on cost containment and fund balance preservation.

Operating Budget Overview



Sanitation and Recreation FB are lower than desired however overall FB Citywide is at 41.32%

FUND BALANCE / OPERATING EQUITY

GENERAL FUND MAJOR ROAD LOCAL ROAD RECREATION CIP SANITATION EQUIPMENT TOTAL

FB JUNE 2016 3,685,512 407,532 109,071 251,092 487,228 18,140 57,944 5,016,519

FB JUNE 2017 3,872,151 402,648 109,553 206,291 430,771 70,628 96,798 5,188,840 2017-18

EXPENDITURE 7,633,740 478,370 307,660 2,057,530 474,500 575,402 375,060 11,902,262

FB JUNE 2018 3,776,831 312,198 108,653 109,181 494,271 39,884 104,338 4,945,356 OPERATING

BUDGET 7,633,740 478,370 307,660 2,057,530 474,500 575,402 440,060 11,967,262 F/B AS % OF OPERATIONS 49.48% 65.26% 35.32% 5.31% 104.17% 6.93% 23.71% 41.32%



fiscal year

Annual

Recycling

tons

Dollar

rebate

per ton

Annual

Recycling

rebate

Avoided

Disposal

per ton

Avoided

Disposal

credit

Total Annual

Credit/Savings

Annual

Savings per

household

2006-2007 1,016 30 30,493 38 38,116 68,608 28

2007-2008 925 55 50,900 24 22,359 73,259 30

2008-2009 1,004 55 55,233 25 25,598 80,830 33

2009-2010 893 30 26,795 25 22,766 49,561 21

2010-2011 811 30 24,342 26 21,096 45,438 19

2011-2012 888 38 33,317 26 23,100 56,417 23

2012-2013 985 50 49,272 27 26,607 75,878 31

2013-2014 1,011 50 50,531 27 27,287 77,818 32

2014-2015 1,028 35 35,966 27 27,745 63,711 26

2015-2016 1,038 20 20,760 27 28,026 48,786 20

Ten Year AVERAGE 960 39 37,761 27 26,270 64,031 27

640,306

RECYCLING ANNUAL AVERAGES

TOTAL H.W. SAVINGS FOR 10 YEARS

• In 2016 the savings of $64,031 equaled 18% of the entire cost of the SOCRRA sanitation bill• Highest recycling community per capita within SOCRRA

Sanitation Fund:

▪ Sanitation Fund is at the millage cap.

▪ Current levy is 1.6167 as reduced by Headlee and Prop A.– No other revenue source for funding of operations.– Fund balance stands at $18,140 @ 6/30/15. – Fee for Single Stream MRF is equal to $0.68 per resident/month or $19,700 annually

for a period of 10 years.

▪ Bond Costs - MRF:– SOCRRA has marketed a revenue bond for the building of single stream recycling

facility estimated to cost 7.9 million dollars and to purchase recycling containers for its member communities. The bond issue is a ten year obligation.


“The Budget Brief”Sanitation Fund:

Funding is in place for a new MRF


“The Budget Brief ”Water/Sewer Fund:

$6.00

$7.00

$8.00

$9.00

$10.00

$11.00

$12.00

$13.00

$14.00

$15.00

$16.00

$1,200,000

$1,400,000

$1,600,000

$1,800,000

$2,000,000

$2,200,000

$2,400,000

$2,600,000

$2,800,000

$3,000,000

2002 2004 2006 2008 2010 2012 2014 2016

WATER BUDGET AND RATES

Water Fund Budget Water Rate

The City Budget Growth is consistent with the SOCWA water rate


“The Budget Brief”Water/Sewer Fund:

Wastewater Cost$41.18

Administration& Wages $22.13

Capital Expense$10.94

Water Purchase$15.46

System supplies$5.86

Maintenance$4.44

How Your Water Bill is Spent

Linear feet of watermain 130,680Linear feet of sewer mains and laterals 247,170Fire Hydrants 269Gallons of water pumped 2016 22,688,280Water Source Lake HuronType of sewer system Gravity/ CombinedLinear feet of sewer line 168,960GWK retention basin storage 124 Million Gallons


▪ “The Budget Brief”Water/Sewer Fund:

▪ Water & Sewer• Reduction in water use

beginning to move up, however this is down 40% since 1990 and 22% since 2000. This presents a significant issue system-wide for SOCWA.

• Water and Sewer billing rate is up 3.48% based upon current and anticipated usage rates.

• $17.00 capital cost is being maintained in 2017-18 to help defray capital and engineering costs .

20,000

22,000

24,000

26,000

28,000

30,000

32,000

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

WATER PUMPED THOUSANDS OF GALLONS

2001 - 2016

GALLONS


▪ $ 440,800 in Capital Projects 2017-18

▪ $ 65,000 Admin - Commission Chambers▪ $ 11,000 P-S Video Capture System ▪ $ 5,000 P-S Turnout Fire Gear▪ $ 10,000 P-S Ballistics vests▪ $ 75,000 DPW Roof Repair (per Schedule) ▪ $ 10,000 DPW City Tree Replacement Program▪ $ 130,000 P-R Scotia Park re-build▪ $ 20,000 P-R Tennis Court Rehab… Temporary

C A P I T A L E X P E N D I T U R E S



▪ $ 85,000 P-R Peasley Park enhancement▪ $ 5,200 P-R Pool Chairs and related deck equip.▪ $ 14,200 P-R Solar Panel, last payment in 2017▪ $ 35,000 LIB Gardner Room repurpose▪ $ 9,100 LIB Library Windows, last payment in 2017

C A P I T A L E X P E N D I T U R E S



“The Budget Brief”Pension legacy cost dilemma:

$323,339

$1,169,604 45

52

0

10

20

30

40

50

60

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

2001 2003 2005 2007 2009 2011 2013 2015 2016

Annual Required Contributions and Number of Retirees

ARC Retirees & Beneficiaries

equal to 3.4 mills


“The Budget Brief”Revenue - Expenditure Projection

ANTICIPATED REVENUE - (000)5 YR REVENUE

2016 2017 2018 2019 2020 PROJECTION

TAX COLLECTIONS 5528 5,762 5,892 6,039 6,106 102.61%

LICENSES & PERMITS 472 470 475 476 485 101.28%

STATE SHARED REVENUE 562 562 564 572 580 100.80%

USER FEES 638 532 547 560 652 100.54%

REVENUE IN THOUSANDS 7,200 7,326 7,478 7,647 7,823 101.31%

ANTICIPATED EXPENDITURES – (000)5 YR EXPENDITURE

2016 2017 2018 2019 2020 PROJECTION

101-COMMISSION 13 19 27 22 24 116.92%

172-ADMINISTRATION 870 838 1,183 1,190 1,215 107.93%

301-PUBLIC SAFETY 3,241 3,104 3,147 3,250 3,380 100.85%

441-PUBLIC WORKS 415 389 439 450 485 103.37%

790-LIBRARY 452 482 526 538 555 104.55%

954-INSURANCE 134 226 182 165 145 101.64%

958-TRANSFERS 1,946 2,142 2,128 2,170 2,252 103.14%

EXPENSE IN THOUSANDS 7,071 7,200 7,632 7,785 8,056 105.48%

BASED UPON 3 YEAR LOOKBACK PROJECTION – TOTAL EXPENDITURES CONTINUE TO OUTPACE REVENUE

▪ The City is faced with systemic revenue issues such as constitutional taxation policies (TV, capped vs uncapped, CPI remains low), population has stabilized

▪ Limited or no growth in state shared revenue.▪ New building permit revenue is good, housing market stable.▪ District Court issue still unresolved ▪ Rackham service fee issues are still unresolved.▪ Rackham property (long-term status remains unresolved)▪ No development space, limited new tax revenue.▪ Millage margin is at 0.5711 mills from override.▪ “Capturing” bump-up in value is critical to long term survival.


“The Budget Brief”Revenue –Expenditure Projection

Future Considerations

▪ Employee Benefits continue to outpace CPI.▪ MERS requires increased funding to help reduce legacy

costs. ▪ GF transfers to the Recreation fund will increase if program

revenue increases remain no higher than CPI.▪ Building and capital cost increases will rise due to deferred

maintenance and aging buildings.▪ Long term decision for revenue or capital bonds for sewer

repair should be discussed in 2017-18.


“The Budget Brief”Revenue – Expenditure Projection

Future Considerations


OPERATING GENERAL FUND / REC FUND 17.5695 17.3205 -1.42%SANITATION 1.6494 1.6167 -1.98%

RACKHAM 0.0000 0.0000 ----SUB TOTAL 19.2189 18.9372 -1.47%

DEBT MILLAGE 3.1582 4.2219 33.68%GRAND TOTAL LEVY 22.3771 23.1591 3.49%

MILLAGE CHANGE % -8.49% -3.49%HEADLEE ROLL BACK ? YES YES

COMPOUND MILLAGE REDUCTION FACTOR 0.9819 0.9802 -0.17%TAXABLE VALUE 330,782,340 342,689,140 3.60%

AVG TAXABLE VALUE PER PARCEL 136,857 141,783 3.60%


2016-17

MILLAGE RATESBUDGETED

The H.W. maximum millage cap continues to be reduced by Proposal A


QUESTIONS - CONCERNS !

budget presentation 2017-2018 · highlights, future issues, outlook. 2017-18 budget proposal 2 one...

Documents