Meeting of 2003-4-1 Special Meeting

Larry Mitchell said this is the kick-off for the Budget Workshop Process for the FY 2003-2004 budget year. This has been a tough year and starting the process early and getting information out to Council should help make the process smoother. A different approach will be used this year; preliminary numbers will be given to Council by mid-April on revenues and expenditures for next year to have a base line to work from. The preliminary budget will be presented in early May, a series of workshops will be scheduled during May and June; revenues will be outlined first, then expenditures will be considered but the first thing is to find out if we have the money.

Mitchell said his two observations about the budget are: 1) The budget is merely an estimate of the City's operations for the coming 12 months. It is a flexible document; as time goes by, things may change and adjustments will be needed; 2) The budget is more than a dollars and cents document. It is a policy document; what is set out in the yearly budget is a statement to the community of the activities and programs that are worthy of our funding and to use this like a work plan for the year.

Rick Endicott, Finance Director, said he would give a brief overview of the process and explanations of terminology and definitions that are key terms in understanding the budget. Endicott explained the budget process going over the booklet handed out. On total expenditures, Public Works, Police, Fire and Parks and Recreation, termed "The Big Four" equals about 80% of the total budget. He said general government, Information Services, and Community Services make up the other 22%.

Mayor Powell asked why there is a 6% difference in the police and fire. Endicott said it would have a lot to do with the number of people employed; personnel make up about 85-90%. Powell said he hoped that could be looked at a little more in depth.

Endicott said on revenues, the sales tax and water make up over half of the revenue, which is important in projecting revenue for next year. Those projections are being developed but that is about 52% of the revenue base. Sewer and refuse make up another 20%, so we have 72% in our sales tax and utilities. Mayor Powell asked what was last year's percentage on sales tax in the actual budget. Endicott said this is based on this year's sales tax. Powell said he thought this was a projection; it says projection. Endicott said no, that is an error; this is actually out of our 2002-2003 budget because we are not trying to project at this point. He said he was just using this as an example. He said this 29% of our total revenue comes from sales tax.

Endicott went over the organizational chart to show the ten or eleven departments and the multitude of divisions. He also went over the budget cycle; July 1 ^st through June 30^th. He said early in the year, the budget information packets are sent to departments with instructions on budget preparation. He continued on through the budget cycle explaining each step. Endicott said about April 15^th, the Council will be provided with some very rough revenue and expenditure forecast numbers we think will be the basis to start the budget process for next year. Council will have a couple weeks to review this and in early May, the Preliminary Budget will be presented. A series of workshops will be held in May and a schedule was included in the back of the packet handed out earlier. A public hearing will be held in June and the budget must be approved and filed with the Excise Board prior to July 1.

Powell asked if Mitchell was requesting guidance and direction as to how to continue the budget, given in writing, to better prepare him for mid April. Mitchell said we would like to do that and if the Council has any projects or activities they have a particular interest in, we certainly would accept those.

Endicott reviewed the terminology and definitions used during the budget process, as listed in the booklet previously handed out. Baxter asked about "fund" in the definitions; it says the enterprise fund is comprised of mainly water, sewer and refuse. He asked what else there would be other than those three. Endicott said landfill, he didn't break out the refuse; that's really all there is in the enterprise fund. Mitchell said some cities may have a golf course or airport, something like that, could be an enterprise fund. Powell said ours is separate and Mitchell agreed. Endicott said we have water, sewer, landfill, and solid waste; those are all enterprise fund accounts.

Powell asked if COLA was mentioned and Endicott said no. Powell said it has been discussed a lot in past years, with different types of meanings, and it may be appropriate to get something in writing where everybody understands what it is and it's not a one time deal. Endicott said it is a cost of living adjustment above and beyond a merit increase; we have a pay plan that has merit increases built into the plan. Powell said right, but it's quite apparent this has been misunderstood over the years. He said he thinks this should be addressed sometime prior to getting into the budget and having a misunderstanding.

Devine suggested the City Attorney provide copies of the section of the City Code so there will not be differences of opinion. Powell said he agrees and we need to address this; there have been such ill feelings over this one thing, over the past year, regarding money and it needs to be dealt with.

Bass asked if it was complicated on the general fund, enterprise fund or sewer rehab, any fund we have, to show exactly what goes into them and what is paid out of those funds, so we can know better what happens with it. Endicott said it is not complicated and he handed out an adopted budget summary. He said this is the entire budget and shows every fund, the total balances, and everything you need to know. Ewing-Holmstrom asked for a definition of the capital outlay, rolling stock, to prevent confusion on the Council and the public. Endicott will do so.

Endicott continued with his presentation going over why a budget, parties to the budget process; role of staff, management, the public, the governing body, and the State Auditor. Endicott said Council will be provided quarterly reports showing the budget status, and if necessary, make budget amendments. He said if you want to make changes to revenue or expenditures after approval or the budget, you may have to do an amendment, which is quite a process to go through.

Endicott reviewed the Municipal Budget Act; Title 11, Section 17-201 - 216 and Public Trust (Authority) Provisions; Title 60, Section 176(g). Powell asked if the Water Authority came under the Public Trust Provisions and Vincent said yes. Powell asked if it addresses funds not being transferred to the General Fund prior to being identified as surplus. Vincent said he would have to check into it. Powell said he would like to see the City move towards what that Authority binds that Governing Board to. He said, in his opinion, we do not adhere to and it would take awhile, but between now and 2005, he hopes this City could move in that direction and it would make the City Government a lot easier to run. Powell said it seems like if we try to pay everything out of the revenues from the water, sewer and refuse, those type of things, they are supposed to meet all our needs, and we know they will not. He said there is not time to do that for the coming fiscal year but it probably could be done by the next year if there is an interest by the Council to do this.

Endicott said one of his long term goals, as Finance Director, is to move towards enterprise accounting. Powell said that is exactly what he was talking about, and the Trust Authority agreement talks about that an awful lot. Endicott said that basically says we charge each department; we do a cost accounting type of accounting, spread all the expenditures and revenues according to what a department is actually costing us, instead of just throwing the money in a big pot and paying funds out of it. He said it's a kind of complicated system, but it's the way the City of Lawton needs to go.

Moeller said on the role of a governing body, there is one thing not here she feels is imperative; that the governing body, which is held accountable by the public, should also be held accountable for overseeing funds expended by other groups, persons or entities. She said one of the things we have is a director to oversee the CDBG money, but it's important that we are accountable for that money that is spent. We give it to someone else to spend and should insure that it is spent in the best interest and wisely.

Endicott reviewed legal deadlines associated with the Budget Act. He said the proposed schedule includes submitting the budget to the governing body 30 days prior to start of fiscal year; conduct a public hearing two weeks prior to start of fiscal year; publish the budget summary and hearing notice five days prior to the date of hearing; and adopt the budget seven days prior to the start of fiscal year. Vincent said key dates are to adopt the budget seven days prior to the start of fiscal year and make the proper submittals.

Endicott continued with his presentation, speaking on budget funding sources; recurring revenues; transfers and other financing sources. He said primarily to finance long term capital improvement projects, usually end up being financed through ad valorem, initially when they are passed by the voters. He said Lawton needs to go back to building this fund balance as carry over as much as possible for the future. Powell said we did not take that seriously previously, it has been talked about every year but the dollar amount is not very big. Endicott said over the last four years, that balance has taken a nose dive and hopefully it can be built back up over the next several years.

Endicott completed his presentation going over budget amendments and the schedule of budget workshops. Powell said he some Council members had scheduling conflicts. Mitchell said the schedule is subject to change; we need to know quickly about the public hearing because of notice requirements.

Powell said prior to construction, signs were in place prohibiting trucks from traveling on 67 ^th Street from Rogers Lane to Quanah Parker Trailway; through research it was found that permission was given to take the signs down. He said construction is now complete and people are asking for the signs to be put back up. He said the City Attorney's office and others went through all the history we have and cannot find a resolution supporting ever putting up a sign.

Powell said he has received several calls about the intersection and he has been out there and observed and it is very dangerous; there is a left turn "Yield" sign to on coming traffic which is all right with the exception of being a little bit blinded there and if there is any speed at all, that could be bad. Devine said one thing to make clear to the people wanting this done; this is not going to stop those 18 wheelers. He said you are only putting a weight limit in there for 31 tons and when those trucks get empty, they can turn around and go out that way. He said you are putting a weight limit, not a wheel limit and if you are going to stop those trucks, you are going to have go to a wheel limit, not a weight limit.

Jerry Ihler, Public Works Director, said they could take a closer look at whether the 18 wheelers would weigh more or less than 31 tons when empty. Bass asked the weight of the trucks when they come in to Wal-Mart; the tractor of the truck weights probably 28,000 lbs. to 30,000 lbs. Ihler said when they come in loaded, they are going to be 60,000 to 80,000 lbs.. Bass said what Devine is saying is correct, they are still going to be able to travel on that road. Powell asked what was needed to get the trucks off that road. Devine said you are going to have to go a wheel limit instead of a weight limit. Ihler said we could do some type of signage that said no 18 wheelers allowed.

Devine said they have got to get on 67 ^th Street to get to Wal-Mart. Powell suggested a sign; "No 18 Wheelers Beyond This Point" and that point being the north side of the entrance into Wal-Mart, there on the south end.

Moeller said she agrees with that. She asked about the route of the trucks taken to service the grocery stores, which is another concern, some are going to come down 67 ^th Street off Rogers Lane to the grocery stores, so it's not just Wal-Mart, there are three major grocery stores to be serviced in that area. Powell suggested including the term "18 Wheelers" and that the sign be put on the north side of the entrance on the south entrance, just after entering 67^th Street, which will keep them off the narrow area, which is the concern of the area residents. Ihler said staff understood and would come up with a solution.

MOTION by Ewing-Holmstrom, SECOND by Baxter, to approve Resolution No. 03-54, as amended, to install signs at the north side of the entrance on the south entrance, just after entering 67^th Street and at Quanah Parker Trailway and Rogers Lane reading, "No 18 Wheelers Allowed Beyond This Point". AYE: Ewing-Holmstrom, Moeller, Haywood, Baxter, Bass NAY: Devine MOTION CARRIED