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BUDGET OVERSIGHT COMMITTEE
March 23, 2006
Minutes
The Budget Oversight Committee held a meeting on March 23, 2006 in the Council
Chambers of the Municipal Complex, located at 10500 North Military Trail, Palm Beach
Gardens, Florida. The meeting was called to order at 8:37 AM.
I. ROLL CALL
Members Present: John Chaplik
Martin Cohen
Harvey Goldberg arrived at 8:42 AM.
H. PENSION REPORT UPDATE
Allan Owens informed the Board that the Committee's report regarding the pension
boards was sent out to Council approximately 2 weeks ago. As of the date of this
meeting, Allan has not heard back from any of the council members. The City hired an
independent actuarial firm. The firm of Bolton Partners is based out of Baltimore but they
have an office in Boca Raton and will be moving to the West Palm Beach area in the next
few weeks. This firm has a lot of experience with pension boards and Allan feels they
will be a good fit. They will have an initial report in the next two to three weeks.
III. APPROVAL OF MINUTES
The Committee talked about a few changes to the minutes and the committee approved
the minutes from January 11, 2006 and February 23, 2006.
IV. CAPITAL PROJECTS BUDGETING PROCESS
Allan Owens introduced Angela Wong, Operations Manager, to the Committee. Angela
gave the Committee an overview of how the City handles the capital outlay and how
capital improvements are approved. Angela explained that the City uses the CIP as a
multi year planning instrument. A capital improvement plan is developed by all
departments for a 5 year period. She explained that all departments fill out a form which
is reviewed and ranked by criteria. There is a committee whose purpose is to monitor the
progress of capital improvement projects. There was discussion about maintenance of the
projects, and Allan added that there is a facilities committee that works with these issues.
The Committee talked about grants and Allan stated that since the Grant Coordinator
position was created, the City collected over 6 million dollars in grant money.
John Chaplik asked if there is a cap on the amount spent on capital projects. Allan stated
there is no specific cap and that management decides what an acceptable level of taxation
will be. There was discussion about what capital improvements are eligible for impact
fees. Allan stated there is a strict legal test to determine if an item or project is eligible.
The Committee talked about what will happen to capital projects when impact fees slow
down. Allan stated that in theory, there would be no additional expansion of facilities and
the general fund would have to absorb any other funding for projects that need to be
done.
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The Committee discussed the status of the building expansion and buying another
facility. There was a question about the possibility of having employees telecommunicate
as opposed to expanding the facility. Allan stated that there has not been any serious
discussion among staff regarding employees working from home, but there is ongoing
discussion about space needs and building expansion.
V. COMPARATIVE BUDGET DATA
Mary Anderson gave an overview regarding the upcoming budget. She stated that the
finance department will be getting each departments this week and this information will
be available the next meeting. In the meantime, she put together a presentation that
shows how Palm Beach Gardens compares with other municipalities. The cities that were
selected in the comparison had similar services and population. This study was based
solely on comparing the general fund items. In most of the areas, Palm Beach Gardens
ranked in the middle range. However, the City ranked highest in relying on advalorem
taxes for revenue and the seconded to lowest in salary increases for general employees.
There was discussion about the process for merit increases for general employees and
Allan explained the evaluation process. There was also conversation about employee
benefits and if there is a way to save money on such benefits. Allan stated that staff
looks at this each year during the negotiation process with the insurance companies.
There was continued discussion about the rapid growth of the City including the long
term expenses and long term tax revenue.
Allan acknowledged that he would like to see the Committee look into and make
recommendations on diversifying revenue sources since this City relies so much on
advalorem taxes. Allan pointed out that the residents do not pay for trash/sewer services.
The City starts paying for these services from the day the resident moves in but does not
collect the taxes until up to 18 months later. There was discussion about putting a
package together that includes lowering taxes but incorporates residents paying for user
fees. Martin Cohen brought up the fact that tax exempt businesses would have to pay for
services if this was implemented. This would be a way for the City to collect money from
these businesses that do not pay taxes.
There was discussion about Scripps and other biotech companies. John Chaplik stated
that he doesn't feel start-up companies are going to be coming into the City because the
real estate and taxes are too expensive. He feels the City should secure a large anchor
company because they have more money for land and taxes. There was also discussion
about the possibility of building new homes on the Vavrus property and the potential
money that it will bring in.
The Committee continued the discussion about the Cities that were used as a comparison
in the presentation that Mary gave. John Chaplik asked for a comparison regarding what
other Cities are doing as far paying for services and revenue sources.
Allan stated that the auditor's report will be done and will be presented to the Council at
the April 6a' meeting. He said this is the first year that there are no manager's comments
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and the Committee congratulated Allan on this accomplishment. There was discussion
about the auditor's function.
VI. NEXT MEETING
John Chaplik reminded the committee that they can call Allan if they have any topics to
put on future agendas. For the next meeting the committee would like to discuss the
auditor's reports, the preliminary department budgets, and discussion about alternate
Revenue sources.
VII. ADJOURNMENT
With no further business to discuss the meeting adjourned at 10:07 AM.
John Chaplik, Chairman
7:ohen V 4ce-E -i rn a a
arvey 14 ldberg, Be
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Attest:
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