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Home My WebLink About07/06/92COUNCIL WORK SESSION July 6, 1992 4:30 p.m. Large Conference Room Members present: Mayor Manning, Dell, Fox, Angel, Buck, Wright, Budak, Lemke. The Mayor announced that the purpose of the meeting was to discuss the F.Y. 1993 Budget and the implications resulting from the City's lower than anticipated cash balance for the year ending June 30, 1992, together with state cutbacks in funding. Larry P. Burger, Clerk/Auditor, reported that the unaudited cash balance of the General Fund for F.Y. 1992 is $460,932. This balance is critically low considering the obligations against the available resources. The City has also experienced cutbacks in municipal assistance and franchise fees. Mr. Burger reported that the State of Iowa may be requesting an additional $2.5 million from the City for its obligation to the statewide pension fund. This amount, together with the $750,000 that was utilized from the fund to meet current year obligations, will leave an approximate $0 balance. In addition, the State may request an additional $49,000 in interest back to January 1, 1992 on the $2.5 million. Councilperson Budak suggested using the additional money in the pension funds to relieve the budget problem. Mr. Burger stated that .he anticipates that the reserve funds will be gone without using them to address current budget needs and further stated that the City cannot raise its levy rate after budget certification. Councilperson Dell emphasized that the City must either fix its problem or not fix its problem, and that the State of Iowa has been one source of many problems with the City's budget. Mayor Manning stated that City Department Heads have met to begin discussion of possible areas of cutbacks. Undoubtedly, the cutbacks will impact levels of service, an important point that must be emphasized. Any suggestions from the Council on service level cuts are welcomed. It will be the goal of the Department Heads to present a plan that may or may not include across-the- board decreases and will state specific areas of cuts. Councilperson Dell stated the City must live within the broad perimeters that have been established by the public, noting that it becomes an issue of public safety versus all other activities of the City. He stated that he senses that the public is saying cut out all other areas except public safety. He stressed the need to decrease the City's general obligation bond debt, increase its cash carry overs and establish a rainy day fund. In response to a question from Councilperson Fox, Councilperson Dell presented the following ideas as possible cost saving measures: Reorganize the administrative structure of the Park and Recreation Departments, centralize dispatch, steps to create a fund balance of $2 to $3 million per year, establish a funding level to return public safety to appropriate levels, establish a rainy day fund, decrease the general obligation bond debt, reduce the amount of dollars spent on consulting engineers and hire two to three individuals, freeze all travel, freeze all vacant positions except for public safety, during next contract negotiations employee contributions should be increased for health care coverage, decrease overtime expense, place a library referendum before the voters, review employee use of personal vehicles, and review the amount of hotel/motel tax the Convention Bureau is receiving. The question was raised as to whether there were any "sacred cows" that Department Heads should not suggest cutting. Councilperson Budak said it was okey to decrease public safety but not to cut manpower. Council Work Session July 6, 1992 Page 2 In response to a question from Councilperson Wright, the Mayor was asked to prioritize what he felt were the important programs/activities of the City. Mayor Manning noted that he would rely heavily upon Department Head input, but that all areas should be reviewed. The possibility of layoffs was discussed. Councilperson Fox stated that he would be interested in Department Head input and how the City can provide the same level of service at a lesser cost or fewer personnel. Councilperson Lemke noted that the Tax Increment Financing Districts are a double edge sword and that without them, the City may have the additional valuation to levy, but on the other hand the increment is paying off much needed public improvements in the downtown area. Councilperson Buck stated that it was his understanding that the Council had taken previous action to reduce the Mayor and City Council's salary to 1991 levels. Since this has not been done, he urged the Mayor and Council to consider this option. It was noted that all City staff, including bargaining and non - bargaining personnel, received a raise as of July 1, 1992. It was noted that the Civic Center debt will be paid in the fall of 1992, but there will be no savings realized in the current year budget from this debt retirement. It was reported by City staff that it is not known when the City will receive an additional $100,000 in fines owed to us by the State of Iowa. Due to computer problems, all fines collected have not been paid to the City. Bruce Meisinger, Budget Analyst, noted that the Police Department budget ended in the red partly due to the non -receipt of rental income from the opening of the city jail. Revenues had been budgeted beginning January 1, 1992. The County still has not opened the city jail for its use. Councilperson Fox questioned what the addition of the Waterloo Housing Authority to the City Budget would mean. Currently, the City subsidizes the Chamber $9,000 for this service. It was also noted that the staff's salaries are probably less than bargaining unit employees, and that some adjustments would be required in this area. Mr. Burger noted that Department Heads have worked and will continue to work together to arrive at workable solutions. Jim Rodemeyer, Personnel Director, asked whether the Council had any areas that should be specifically exempt from cuts. He noted that the Department Heads wish to present a consensus report taking into account the desires of the Council. He noted that due to ongoing budget constraints over the past five years, there are no longer many efficiencies that can be found that will result in a savings of $500,000. He noted that undoubtedly the cuts will result in service level decreases. It was noted that Total Quality Management has been undertaken by the Public Works Department, but that no immediate savings will be realized in the near future. Councilperson Fox noted that perhaps a freeze in salaries should be considered since we may be talking about possible layoffs. It seems incongruent to give salary increases and also have layoffs. Bev Lind, Director of the Waterloo Library, noted that her staff has voluntarily agreed to no increase in salary, and still experienced layoffs. Any further cuts will mean reduction in services. Council Work Session July 6, 1992 Page 3 Rick Tagtow, Director of Parks and Forestry, noted that City departments have cut budgets for five years, and that savings and efficiencies have already been realized and any further cuts will be a reduction in services. He also cautioned that the publics' priorities often change over time depending upon the issue at hand or time of season. After discussion, it was the consensus of the Council that Department Heads generate a list of ideas for possible cuts, that all departments be reviewed and that said items be presented to the Council upon completion, hopefully by Monday, July 13, 1992. No official action was taken by the City Council. The meeting was adjourned at 5:30 p.m. Larry P. Burger City Clerk/Auditor