Ashland Budget Study Session – March 19, 2018
Mayor John Stromberg brought to order the third Ashland budget study session Monday at 5:30 p.m. in the City Hall Council Chambers.
Public Works Director Paula Brown presented a one-page summary of 28 capital improvement projects (CIP) with an estimated cost of $1.4 million. She said the Nevada Bridge project will be converted to Oregon Department of Transportation (ODOT) funds, which will not be entirely spent during the 2017-2019 budget biennium but will be obligated.
The Hersey Street repavement design will be completed in nine months, she said. Pump stations will come to the council for approval March 20, Brown said, and plans for the water treatment plant will be presented April 2. The outflow relocation project Ashland Creek to Bear Creek has been accepted by the Department of Environmental Quality (DEQ) under its temporary credits program, she said.
The oxidation project (tied to the wetlands project) design will be completed by late spring, Brown said.
Brown suspects there is leakage in the water treatment plant piping system because Ashland “produces two million gallons a day of effluent until there is a heavy rain, and then it spikes,” she said.
Councilman Rich Rosenthal asked what percentage of CIP are paid for by the general fund. “Almost all are paid for by enterprise funds,” Brown replied.
Citizens’ Budget Committee Member Paula Hyatt questioned funding for the railroad project and asked whether money was being transferred from other sources.
Budget Committee Member Shaun Moran said, “It is hard to show whether a project is over or under in a biennium budget” when you are looking at one year at a time. “You want to know the whole picture and see the carry forwards actually shown in this year’s budget,” he said.
Next up was Director of Administrative Services and Finance Mark Welch, who said he is modeling line items on his spreadsheets by changing percentages to look at the impact. “An economic slowdown is not built into the model,” he said.
“There will be challenges in the general fund,” Welch added—“we’re still showing a $2.5-million deficit going forward.”
“Do you see 10, 12, 13% increases in personnel services?” Moran asked.
“PERS (Public Employees Retirement System) is forecasting a lot higher than a 7% increase,” Welch answered, “and based on actual information we have we can break down costs better with individual rates rather than with blended rates.” The PERS baseline is $3.5 million increasing to $4.5 million, he said.
Referring to the second quarter financial report—July 1-December 31 2017—Welch said property taxes were above budget and general fund expenditures below. The health benefit fund was above budget, he said but claims remained high.
“Is a 16% increase sustainable?” asked Budget Committee Chair David Runkel.
“We know the health benefit fund is not sustainable,” Welch replied. “If you have one extra payroll it will throw off the numbers,” he added. This reserve fund is only $60k.
Runkel asked if Ashland firefighters who responded to fires in California last year were reimbursed, and Welch answered 75%.
Chris Jung demonstrated OpenGov, “putting a legacy system into the cloud,” he explained. Citizens will be able to look at Ashland’s finances using this tool.
The council asked for a volunteer to join the Budget Process Ad-Hoc Committee. Budget Committee Vice Chair Garrett Furuichi volunteered and was told he would be notified by the Wednesday before the next council meeting.
City Attorney Dave Lohman solicited volunteers to be on a committee dealing with grant cycle updates. The meeting dates are Thursdays, but he proposed changing that to Wednesdays.
Councilman Dennis Slattery, in remarks about the biennial budget, said “When I get three more votes in the council I will move to go back to annual budgeting. Biennial budgeting moves citizens one step further back. We need to improve our long-range plans. We need to have more and more transparency, and to consider our citizens as assets.”
Addie Greene, Ashland