HomeMy WebLinkAbout2017.0424.TCSM.MinutesTOWN OF FOUNTAIN HILLS
MINUTES OF THE SPECIAL SESSION OF THE
FOUNTAIN HILLS TOWN COUNCIL
APRIL 24, 2017
* CALL TO ORDER AND ROLL CALL
Mayor Kavanagh called the meeting to order at 5:00 p.m. in the Fountain Hills Town Council Chambers.
Present for roll call were the following members of the Town Council: Mayor Linda Kavanagh, Councilmember Nick
DePorter, Councilmember Cecil Yates, Councilmember Dennis Brown, Councilmember Art Tolis, and
Councilmember Henry Leger. Town Manager Grady Miller, Town Attorney Andrew McGuire, Finance Director
Craig Rudolphy, and Town Clerk Bevelyn Bender were also present.
Vice Mayor Alan Magazine (arrived at 5:01 p.m.)
AGENDA ITEM #1 - DISCUSSION WITH POSSIBLE DIRECTION TO THE PROPOSED TOWN OF
FOUNTAIN HILLS FY 2017-18 BUDGET, INCLUDING ALL PROPOSED REVENUES, EXPENDITURES
AND PROGRAMS FOR ALL GOVERNMENTAL FUNDS.
Town Manager Miller gave introductive remarks and provided background information on the projected Town's
revenues and expenditures; he mentioned that staff held an open house on Thursday, April 20th with just a few
residents in attendance. Mr. Miller explained the base and supplemental budget requests. Mr. Miller turned the
meeting over to Finance Director Craig Rudolphy reviewed information presented in a PowerPoint presentation
(available on-line and in the office of the Town Clerk). Mr. Rudolphy stated the focus of the meeting was the fiscal
budget year 2017-18 and exhibited the Mission Statement, Vision Statement and Values Statement; he stated these
were the basis for the budget and were repeated in the financial statements or budget reports.
Mr. Rudolphy continued with a review of the five-year forecast, which was presented to Council earlier and explained
the General Fund projections on revenues and expenditures sighting a large shortfall in local sales tax, HURF Funds,
and State Shared Revenues along with the budget assumptions. Mr. Rudolphy gave a debt overview of the outstanding
bonds and pointed out that the entire Town's debt would be paid off in 2020 and the Eagle Mountain debt would be
eliminated in 2021. He also noted that the proposed budget actual for FY2017-18 was $34,317,622, excluding
transfers. Mr. Rudolphy showed a slide comparing previous fiscal year budgets and listed the budgeted assumptions
and stressed that Council should be mindful of the State -Imposed Expenditure Limitations Law and adding his
assumption calculations were made under the current law.
Mr. Rudolphy reported the funding of departments' core service requests in the budget and pointed out the total
supplements approved totaled $1,598,942 in the General Fund and various other funds. Mr. Miller added that
designated revenue sources covered a portion of the $1.3M of approved supplements and noted the net impact would
be far less, with 285K ongoing or one-time only expenses.
Mr. Rudolphy continued and reviewed the budget highlights and Vice Mayor Magazine asked what the downtown
lighting improvements entailed. Mr. Miller answered that the project was in the Capital Improvement Projects (CIP)
and project variations (i.e. the wrap lighting the trees and addressing issues in the electrical located on the Avenue of
the Fountains). Councilmembers discussed the pros and cons of the designated funding for lighting on the Avenue
and whether it was a benefit to the Town and a cost savings.
Councilmember Leger left the dais at 5:15 p.m.
Councilmember Tolis commented that he believed that the Council had previously removed the Fountain Hills
Boulevard Paving CIP project from the budgeted year 2017-18 in the amount of $650K. Mr. Rudolphy explained that
the design concept study totaled $100K noting that if the Town did not spend the funds, they would be lost. He also
mentioned that the study would determine final shoulder paving costs. Councilmember Tolis asked if this was a grant,
why this amount was shown as an expense. Mr. Rudolphy answered that the grant was a 60/40 split and the expense
had to be budgeted even through the Town would be reimbursed for the grant.
z:\council packets\2017\r170518\170424m.docx Page 1 of 4
Councilmember Leger returned to the dais at 5:20 p.m.
Mayor Kavanagh asked if staff could show CIP funding sources in a separate column noting any grants and portions
covered so the residents would have a better understanding and Mr. Miller agreed staff could do this. Mr. Miller
reminded Council they had requested each project be brought back to them for review and approval before moving
forward with any project.
Mr. Rudolphy commented that his projection of the MCSO contract was recently reviewed and revised down to 5%
from 10% in the future years after 2017-18. Mr. Miller stated that in June 2017 staff would hold a work study to
further discuss MCSO's contract and future costs to the Town.
Mayor Kavanagh asked if increases in future Town population was considered in staff's revenue projections and Town
Manger Miller answered that it was not calculated in the current financial documents and stated by June staff would
have a better picture in the Town's financial forecast and could make adjustments at that time in hopes of addressing
Councilmember Tolis questions. Mr. Miller also added that revenue options would be address later this year.
Mr. Rudolphy continued and reviewed the Town's 21 different funds and Mr. Miller added that some of the funds
listed had restrictions.
Vice Mayor Magazine suggested placing a footnote on each of the CIP programs and list where the funding came from
for transparency purposes. Mr. Miller indicated that the information was contained in the draft budget but the
presentation would be revised.
Mr. Rudolphy pointed out that at the end of the Town's five-year slide, the projections showed a cumulative shortfall
of $3.7M.
Mr. Rudolphy presented slides for the following:
Pavement Management Program
General Fund historical projections (excluding transfers
Fountain Hills comparison to other municipalities within the Town's General Fund Operating costs
Town Employees ratio per 1000 population and noted the difference between Fountain Hills with only FTE's
where other Cities and Towns employed additional utility and public services employees
Councilmembers discussed the community comparison ratio per capita slides as to how pertinent the information was
and the various interpretations of the numbers presented.
Mr. Rudolphy offered to create a comparable chart listing the same size Cities or Towns as Fountain Hills and Mayor
Kavanagh answered she would like to see that information.
Mr. Rudolphy discussed the General Fund projections including the organizational chart, Public Safety and Fire and
Emergency and included a break -down of costs along with the Law Enforcement and the Municipal
Court. He also explained that the General Government Contingency Fund was newly created to capture those costs
that were unique Town -wide and these items were listed as non -departmental with the funds held in the Contingency
Fund. Mr. Rudolphy continued with the Administrative Budget breakdown along with Economic Development as well
as the budget highlights. Vice Mayor Magazine asked why the Town Clerk's budget had been reduced by 14.6% and
Mr. Rudolphy explained that next year the Town was not budgeting for election costs.
Mr. Rudolphy mentioned the Development Services flow chart and budget highlights.
Councilmember Tolis discussed the Economic Development Marketing budget and the needs of Director Scott Cooper.
He indicated that the Council was extremely supportive of Mr. Cooper and requested he return to Council with a
proposal to either hire an assistant or continue with the proposed budgeted item involving the hiring of a marketing
firm to address the Town's retail and to assist him in this area. Mayor Kavanagh added that if Mr. Miller could find
z:\council packets\2017\r170518\170424m.docx Page 2 of 4
the funding she could support including both proposals. Mr. Miller noted staff would have an answer by the end of the
preliminary budget.
Councilmember Tolis expressed it was important to retain the current businesses in Fountain Hills and stressed it took
a relationship with the Town and face to face contact. Discussion ensued regarding the Town's retail vacancy rate, Mr.
Cooper's retention and marketing strategy, the question of why hire a firm to assist vs. adding a staffer, and how best
to leverage resources.
Mr. Rudolphy continued with the Development Services budget with estimated numbers broken down by division.
Councilmember Tolis left the dais at 6:19 p.m.
Mr. Rudolphy discussed the Public Works Department's budget highlights. Mayor Kavanagh requested information
on the department's custodian positions; Public Works Director Paul Mood responded that staff would look into if the
contracted service could be increased in hours to cover necessary week -end and other required services and see if the
contracted service would be less expensive than hiring additional staff.
Councilmember Tolis returned to the dais at 6:21 p.m.
Mr. Rudolphy covered the Street Fund, HURF/Street programs and the 2017-18 staff recommended maintenance
expenditures and then moved on to the Community Services Department employment chart, budget highlights by
division.
Mr. Rudolphy discussed the CIP plan totaled $7,049,800 and noted the changes in the proposed revised fee schedule
shown in red text.
Mr. Rudolphy moved on to the Personnel graph noting 55 FTE's were projected for FY2017-18 with personnel cost of
$4,209,986. He pointed out that included the recommended cost of living increase at 2.5%. Mr. Rudolphy informed
Council that changing to the Arizona Metropolitan Trust had saved the Town $100K annually in medical employee
benefits costs.
Mr. Rudolphy walked Council through the next steps in the budget process with the final budget shown as being
adopted on June 1, 2017 and the tax levy adopted by Resolution on June 15, 2017.
Vice Mayor Magazine congratulated staff for a job well done and expressed his appreciation. Mayor Kavanagh
acknowledged staff members who worked on week -ends to meet deadlines.
Councilmember Leger asked if the $550K to repave the downtown could be paid out of the Downtown Fund and Mr.
Rudolphy answered "yes" it was possible. Mr. Miller added that was a Council policy decision.
Councilmember Leger questioned the $30K amount budgeted for Tourism and asked what the funds were designated
for. Mr. Miller answered staff was working with the Chamber of Commerce Director to relocate the Visitors Center to
the Avenue of the Fountains adjacent to the Chambers' planned office, which was to be located to the Park Place
Development. He added that the Visitors Center would be operated with Town volunteers, overseen by the Chamber,
and that the $30K from the Town would help fund the Visitors Center; he stated it was a cost effective project for the
Town.
Mr. Miller stated that the Town was currently negotiating an operating agreement that would allow the Town to
participate in the Visitors Center noting that the agreement would be provided for Council's review and approval in
June 2017. Mr. Miller noted that the Visitors Center would encourage people to spend money in Town and give
direction to those who requested services or places in Town. He added the Visitors Center would offer a convenience
to visitors as physical presence that used the Town's brand.
Councilmember Leger asked how the Visitor Center would add to the benefits of what staff had already established
and questioned if it would add value or if it would overlap staff functions. Mr. Miller said he had stressed to the
z:\council packets\2017\r170518\170424m.docx Page 3 of 4
Chamber that the Visitors Center must promote all businesses and that he felt this idea fit with the Town's tourism
strategy for success.
Councilmember Tolis asked about the funding allocation for development of the shell space behind the Council
Chambers for an economic development office (store front). Miller reminded the Council that this project had been
eliminated during the Council's CIP discussion.
Mr. Rudolphy added one more piece of information on how staff would budget third party inspection funds and
explained that those funds were not currently shown in the budget, but would be a pass-through funding with a
significant adjustment noted within the revenue and expenditures to allow for that type of transaction.
Mayor Kavanagh asked if there were further questions for Mr. Rudolphy and if not requested a motion to adjourn.
AGENDA ITEM #2 - ADJOURNMENT
Councilmember Yates made a MOTION to adjourn the meeting and Vice Mayor Magazine SECONDED the motion,
which CARRIED UNANIMOUSLY (7-0), by those present. The Special Session adjourned at 6:38 p.m.
1111WASell17 a 0111111ell 1I:71►`g1110&1
Lo
ATTEST AND
PREPARED BY:
Bevelyn Bender, Town Clerk
CERTIFICATION
Linda M. Kavanagh, Mayor
I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Special Session held by the
Town Council of Fountain Hills in the Town Hall Council Chambers on the 24th day of April, 2017. 1 further certify
that the meeting was duly called and that a quorum was present.
DATED this 18th day of May, 2017.
Bevelyn Bender, Town Clerk
z:\councilpackets\2017\rl7O5l8\170424m.docx Page 4 of 4