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HomeMy WebLinkAbout06102004CITY OF PORT TOWNSEND CITY COUNCIL MINUTES OF THE WORKSHOP SESSION OF JUNE 10, 2004 CALL TO ORDER AND PLEDGE OF ALLEGIANCE The City Council of the City of Port Townsend met in workshop session this tenth day of June, 2004, at 1:00 p.m. in the Port Townsend Council Chambers of City Hall, Mayor Catharine Robinson presiding. ROLL CALL Council members present at roll call were Freida Fenn, Kees Kolff, Laurie Medlicott, Catharine Robinson, and Frank Benskin. Michelle Sandoval and Geoff Masci arrived late. Staff members present were City Manager David Timmons, Finance Director Michael Legarsky, Assistant Finance Director Corena Stem, Project/Grant Accountant Randy Pendergrass, and Legal Assistant, Bobbie Usselman. 2005 BUDGET City Manager Timmons stated the workshop was called to address budget issues for 2005. The goal is to get a consensus around what we can do to address the root cause of issues we are facing. He gave an overview of the entire current budget, including a few year's history and future projections. He said it was originally reported by the Department of Revenue that Initiative 864 (I-864), if passed, would not impact cities. However that information is incorrect and the initiative will impact the general fund. Because of that, there are certain steps the Council may need to take to insure it can maintain its budget in the future. Initiative 864 is a statewide initiative, and if it is passed statewide, even though the vote in our area may not pass it, we are still affected. Mr. Timmons gave an overview of the options the City can take ifi-864 passes, or if it does not pass. If the City does nothing and 1-864 goes through, we will "crash and bum" in 2005. If 1-864 passes, it is effective January 1, 2005. If we did nothing, we would be in a desperate situation, having to shut down something immediately to make up the deficit for the year. He believes we cannot take the risk that 1-864 will not pass, and need to have a plan in effect. Ifi-864 fails and we don't take any action to address the funding needs, we will be okay going into 2005, but we will mn into the same problem in the future. Mr. Timmons provided different scenarios to show what may need to be done in the future. There was general discussion about whether services are mandatory or discretionary. Mr. Timmons stated some discretionary services could be handled through districts, such as a sewer district or park district. He provided a handout showing which services fall into which category. Mr. Timmons stated if we choose to go to voters on any initiative, we cannot speculate on what the impacts might be. We cannot put out a flyer saying if this doesn't pass, the following cuts may be made. Municipalities are preparing an alternative budget model that contains what will be de-implemented if 1- 864 passes. We need to plan to have a decision ready by July, which is when we will know whether or not 1-864 will be on the ballot. We need to have a general consensus in regard to how we are going to address the issues, so when we prepare the preliminary budget, we will know what course it will take. If City Council t~orkshop Meeting Page 1 June 10, 2004 1-864 fails in September, you have another bite of the apple in November. Otherwise, you will have to wait until 2006. Port Townsend does not have a healthy reserve and cannot wait until 2006. Mrs. Medlicott asked what would happen if we ran out of money. Mr. Timmons indicated we would have to expand our service area to enhance revenues, or cut services. We have been discreetly cutting service by deferring, but we cannot afford to do that any longer. Mr. Timmons stated five years ago he started trying to identify what was happening in our budget. It took time to figure out. There was absorption of services over the past decade and deferral of expenses, such as streets and facilities. We have exhausted our funding sources. We have started looking at those areas that can have district capabilities, and also at a special street levy that is comparable to what the County has. We have explored the library annexation and have deferred those discussions, as the County was not receptive. There have been discussions with Fire District 6 regarding consolidation. The timing was not right as the district was in turmoil. The Parks Advisory Task Force recently recommended that there was no perceived threat to recreation services in the City and did not feel a need to move to a park district or have a special levy. There was general discussion concerning how the process levy would work in relation to 1-864. Mr. Timmons provided estimates of a property tax levy. Concerning districts, we could create a park district, a fire district or a library district. As far as timing is concerned, the last date to get on the September ballot is July 30. We will also know in mid-July whether 1-864 will be on the ballot. Mr. Timmons indicated that staff would create two draft budgets: one ifi-864 goes on the ballot, and one if it does not. He stated the "sacred cows" of the Program Options are parks and recreation; fire/EMS; police; streets and library. There was further discussion about how services are categorized, mostly directed by RCWs. RECESS Mayor Robinson called a recess at 3 p.m. for the purpose of a break. RECONVENE The meeting was reconvened at 3:10 p.m. Councilmembers were receptive to the idea of a levy that affirms the current levy rate of $1.94, and also that there is a need to do an educational campaign for voters to understand why there will be a need for an additional levy. There was further discussion about the possibilities of different districts, the wording of same, and voter approval rates. Mr. Timmons indicated we could do a special levy for general appropriation purposes, or we can earmark money for specific appropriation. It was discussed that voters are~ more inclined to support a levy if it is specifically earmarked. ThOm was general discussion concerning the City being proactive in some long-term infrastructure development, including local improvement districts (LID). Additionally, there was discussion concerning levy options for different areas. Mr. Timmons stated there is an advocacy group behind ballot issues, and you can get the biggest bang for your buck with fire. It was agreed if Council has to go to the voters for approval, that we should get enough money to fix our problems and have some in reserve. City Council Workshop Meeting Page 2 dune 10, 2004 Mr. Timmons suggested two draft budget projections, one with the impacts of 1-864, and another without concerns ofi-864. Also to be considered will be the fire district consolidation. Mr. Timmons cautioned that in order to go to the voters, Council must be unified, with no political dissent. COUNTY REQUEST FOR FUNDS Ms. Robinson indicated there would be discussion concerning the May 24, 2004 letter to the City from the Jefferson County Board of Commissioners requesting a contribution of funding to the Jefferson County Health & Human Services to fund public health services used by the City and County that are not paid for by property taxes. Mr. Kolff indicated the Health Department needs $110,000 to save some critical services, and discussed the trickle down of program cuts that start with the federal government. He suggested we look at our banked capacity as a way to address in the short term a six-month bridge of $55,000 for health department funding. Mr. Legarsky stated we have $140,000 in our banked capacity. Mr. Masci, who is on the Board of health, stated in reality there is a need for only $25,000 this year to continue the program. This issue was discussed by all Councilors, who understand the importance of the position considered being cut. Council also indicated the City itself is not in a position to be giving away extra funds we need, especially after the earlier discussion on the status of the City's finances. Council requested Mr. Timmons to see where he could find funds to provide $25,000, and report back to council in two weeks so it can be voted upon before the end of the month. ADJOURN There being no further business, the meeting was adjourned at 5:00 p.m. Minutes by Bobbie Usselman, Legal Assistant Attest: Pam Kolacy, CMC City Clerk City Council Workshop Meeting Page 3 dune 10, 2004