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HomeMy WebLinkAboutMinutes BOC 051905,6 . It BUDGET OVERSIGHT COMMITTEE May 19, 2005 Minutes The Budget Oversight Committee met on May 19. 2005 in the Council Chambers of the Municipal Complex, located at 10500 North Military Trail, Palm Beach Gardens, Florida, and opened with the Pledge of Allegiance. I. ROLL CALL Present: John Chaplik, Martin Cohen and Maureen Maquire Also Present: Allan Owens, Staff Liaison and Finance Administrator, Mary Anderson, Alternate Staff II. APPROVAL OF MINUTES The Board approved the minutes from the January 27, 2005 meeting in a 3 -0 vote. III. DIRECTIVES FROM LAST MEETING Alan Owens reported on the two questions that that board wanted details on. The first question was regarding the tax status of privately owned property that is leased to a non -profit entity. Staff has verified with the Palm Beach County Property Appraisers Office.that the owner of the property would be responsible for paying property taxes but the lessee would retain their tax exempt status. This would pertain to tangible personal property. John Chaplik questioned whether the City will be getting taxes from the Bascon Palmer Eye Institute at their new location on PGA Blvd. Alan said that if it is privately owned the City will receive taxes, but the building is owned by a non- profit we will not. John was concerned with the future and stated the City should look at the owners before approving projects to see if the City would receive taxes from the project. Regarding the question about the City having an audit committee, Alan reported that Staff received information from Palm Beach County, Palm Beach County School Board and the City of West Palm Beach. They found that in Palm Beach County and the School board the audit committee is primarily dealing with the internal audit function. Palm Beach Gardens does not have that function. Alan then focused on the City of West Palm Beach which does have an audit committee similar to what this board is referring to. Two officials in the City of West Palm Beach have provided Alan with a copy of their charter,. which set up their committee. The primary purpose of that committee is with respect to the external audit function is to provide oversight of the function. The committee M � consists of five members and they review the annual audit plan, review the audit progress and the audit findings. They also assist in the auditor selection process. The City should establish an audit selection committee in the near future. The City is in the process of developing an RFP for the selection of auditors for the years ahead. They will also be putting together an audit selection committee to help with this process. This will be brought to City Council in the near future. IV. BUDGET PROCESS Alan reported where the City is in the budget process for next year. They have estimated a beginning undesignated balance for next year of about 6.9 million dollars. Estimated revenues are about 61.6 million dollars. The property evaluation will come in on June 1, 2005 and at the next meeting Alan will have the report on the property tax valuation. Estimated expenditures are about 63.2 million dollars. As of this date the expenditures are higher than the revenue but this is without knowing what the property taxes will be. If there was no change in these numbers the expected reserve balance would be 5.24 million. This is about 9% of the expenditures for 2005/2006 budget, which is within the target range guidelines. It is actually below where it has been in the past but it is still within the target range. There was discussion about what would happen to the reserve if the is another big hurricane. Alan said there is enough to cover another hurricane if necessary. Alan discussed staff salary and benefit costs. This went from 36.7 million to 41.3 million. This is 4.7 million dollar increase. Operating expenses went from 11.7 million to 12.1 million, which is about a 2.3% increase. Alan stated that everything other than personnel and capital expenses are included in the operating expense. The over all increase for personnel and operating will be about a 10.3% increase. Some of the factors affecting the increase are the increasing insurance costs. The health insurance will increase about 15% alone. The PGA Flyover maintenance will be about $400,000 that will have to be transferred from the general fund. The cost of living adjustment is based on the March Employment Cost Index which is 3.6 %. There was discussion regarding the health insurance. Staff will be looking at other options for insurance as they do every year. There was also discussion about the maintenance of the PGA Flyover. The board questioned if the road was a county road and do we get money from the county to maintain the road. Alan stated that we do not get money from the County but the City is trying to work with the developers in the area to help maintain the road. There was discussion about the increase in personnel and the background of the need for more positions and cutting overtime for current employees. There was also discussion about the Firefighters and Police Pension funds and the Fire and Police contract negotiations. N �y� • 1 Some other factors that are affecting the budget process this year are the HR department is currently doing a market study of compatible cities. They are looking at staffing levels and compensation including The Board had questions about the golf course funds. Alan stated that the golf course funds will'#M be part of the recreation budget as opposed to the enterprise fund it is now in. There was discussion about the golf course fees and how the rates are changed. There was discussion regarding the Fleet Committee. The Fleet Committee reviews the recommendations for replacement or new vehicles. They also look at alternative types of vehicles which might be more economical as far as purchasing the vehicle and the fuel economy. The facilities department along with all the department heads is looking at ways to conserve energy throughout the city. The board would like a summary of line items broken down by each department. Alan will provide this to the Board for their review. The Board thanked Councilmember Hal Valache for attending the meeting. V. Next Meeting At the next meeting the board will discuss the committees thoughts and how they would like to provide feedback to City Council and what format they would like to communicate with council their findings and recommendations. VI. ADJOURNMENT There being no further business to discuss, the meeting was adjourned at 3:20 PM Approval: I Ur JJhn Chapl' MWn Co Ma� squire Attest: Sus Bell