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HomeMy WebLinkAboutMinutes City Council - 05/02/2005 - RetreatI HEREBY CERTIFY that the foregoing is a true and correct copy of the minutes of the Corpus Christi City Council Retreat of May 2, 2005, which were approved by the City Council on May 31, 2005. WITNESSETH MY HAND AND SEAL, on this the 31st day of May, 2005. Armando Chapa City Secretary SEAL MINUTES CITY OF CORPUS CHRISTI, TEXAS City Council Retreat May 2, 2005 - 8:36 a.m. PRESENT Mayor Henry Garrett Mayor Pro Tem Brent Chesney (Arrived at 8:45 a.m.) Council Members: Melody Cooper Jerry Garcia Rex Kinnison Bill Kelly (Arrived at 8:40 a.m.) John E. Marez Jesse Noyola Mark Scott (Arrived at 8:50 a.m.) City Staff: City Manager George K. Noe City Attorney Mary Kay Fischer City Secretary Armando Chapa Mayor Garrett called the retreat to order in the Bayview Room of the American Bank Center. City Secretary Chapa checked the roll and verified that the necessary quorum of the Council and the required charter officers were present to conduct the meeting. Mayor Garrett asked staff to introduce themselves for the benefit of the new Council members. City Manager Noe stated staff would make a number of presentations to provide background information that may be useful to Council during their goal setting session in the latter part of the meeting. The scheduled reports were updates on the Bond 2000 and Bond 2004 programs, a five- year financial forecast, and a status report on the prior goals set by the City Council. The first presentation was an update on the Bond 2000 program by City Engineer Angel Escobar. Mr. Escobar reviewed the complete bond project list for the public health and safety, park and recreation, museum, and street improvements categories. He reported the vast majority of the projects were completed, with a number of exceptions which he briefly reviewed. Mr. Escobar then responded to Council member questions. Mr. Escobar reported on the Bond 2004 schedule. He referred to a list of the Bond Issue 2004 propositions, noting that the total package was $95,000,000. An additional $30 million in utility relocation costs associated with the street improvement projects was being funded through a one percent increase in the utility rate for three consecutive years. Mr. Escobar covered two project timelines. The first project timeline was for street improvements, and Mr. Escobar stated the city had made a commitment to have all the projects either completed or under construction by November 2008. He stated staff used several criteria to determine the timing of street closures, including impact on traffic and business access, coordination with drainage projects, coordination with the projects of other governmental entities, and materials costs. Consequently, he noted that staff had recommended that construction work on major thoroughfares such as Ayers Street and Gollihar Road or Everhart Road and Saratoga Boulevard not Minutes - Council Retreat May 2, 2005 - Page 2 be worked on concurrently. Staff also accounted for any right-of-way acquisition. Additionally, staff was attempting to equalize the cash flow needed for construction throughout the four year period. He pointed out the projects that were associated with TxDOT. He noted the drainage improvements in the Sunnybrook/Manshiem and Lindale areas would be worked concurrently with the street projects in these areas. To reduce supply costs and to expedite work, staff has also recommended that clusters of projects be awarded to one contractor. Mr. Escobar reviewed the second project timeline for the Public Health & Safety, Public Facilities, Parks and Recreation, and Bayfront projects. He stated staff tried to coordinate construction around Little League, golfing, and other major events to minimize disruptions. Regarding the neighborhood parks improvements, Mr. Escobar noted these projects was scheduled to be completed in-house by the park and recreation department. Staff then responded to questions by Council members. Assistant City Manager Oscar Martinez provided an update on the five-year financial forecast. He discussed the revenues sources for the general fund, more than half of which were comprised of property tax (28 percent) and sales tax (23 percent) revenues. He noted that the 69 percent of the city's revenues sources were inelastic in that they were not under city control, and thus difficult to adjust. Besides the aforementioned property tax and sales tax, the inelastic sources included industrial district and franchise fees. Mr. Martinez covered the sources of expenditures in the general fund. He said 51 percent of expenditures are dedicated to public safety issues, followed by solid waste services at 10 percent, and park and recreation/museum at 10 percent. Mr. Martinez displayed a graph providing historical data on ad valorem tax net taxable values between 1996 and 2004. Within the last two years, he noted a healthy percentage increase of 6.19 percent in 2003 and 7.73 percent in 2004. Mr. Martinez also displayed a graph with historical data on sales tax collections. He noted the sales tax revenues had increased substantially over the last two years. The percentage increase in 2004 was 6.77 percent and 5.5 percent (estimate only) in 2005. He noted that the 2005 figures were based on what was budgeted, and would probably come in higher than 5.5 percent. Mr. Martinez provided a historical prospective of industrial debt payments in lieu of taxes. He said the taxes were a hybrid of ad valorem taxes based on the appraised value of the property located in the industrial district area (in the city's extraterritorial jurisdiction). Mr. Martinez briefly discussed franchise fee revenues, comprised of cable, AEP, and telecommunication services. He pointed out a steady increase in cable revenues, which indicated their services were expanding, but noted broadband services were not included due to pending litigation. Regarding AEP, he said revenues had decreased since 2002 because of deregulation, and the rates were being renegotiated. In addition, he reported the decrease in telecommunication services was due to customer preferences for cell phone service over land line service. Although the presentation material estimated the 2005 franchise fee revenues to be $5.5 million, staffs adjusted total was $4.6 million, creating a $900,000 shortfall. Minutes - Council Retreat May 2, 2005 - Page 3 Mr. Martinez provided a historical perspective on building permit activity. For the last ten years, the number of permits issued was approximately 6,000. In 2003, however, he said 7,800 permits were issued, and in 2004, 7,100 permits were issued, substantially above the ten-year average. Mr. Martinez discussed the status of the General Fund unreserved fund balance. The City Council passed a financial policy which set a goal of having the General Fund unreserved fund balance equal to ten percent of the city's operating expenditures. Mr. Martinez stated the city has been more than successful in meeting this goal, going from a low of $7,547 in 1995 (0.01 percent) to $12,387,670 in 2004 (approximately 18 percent). The estimated amount in 2005-06 was $14.256 million. Mr. Martinez discussed to the five-year financial forecast. First, he reviewed a number of assumptions staff used to develop the projections as follows: revenues - a conservative 3 percent increase in ad valorem and sales taxes; expenditures - 12 percent increase in group health insurance contributions; 3 percent increase in fleet repair costs; and a 10 percent increase in Municipal Information Services contributions. Second, he mentioned a change in the 2005-06 forecast, namely that the ambulance fund was being projected to be blended into the general fund to simplify a number of financial transactions. Regarding net revenues, Mr. Martinez said staff conservatively projected a 2.2 percent annual increase over five years, from $163.35 million in FY 2005-06 to $175.97 million in FY 2009-10. Regarding total expenditures, he stated the increases were linked to the assumptions he had previously mentioned. He highlighted an $11 million increase in expenditures projected between FY 2004-05 ($155.97 million) and FY 2005-06 ($166.74 million). The $11 million increase could be attributed to the 45 cadet police academy, the full funding of the Juvenile Court, and the absorption of the ambulance fund into the general fund. In general, he said total expenditures were projected to increase by 4.3 percent over the five year period. Mr. Martinez also pointed out the projected surplus amounts needed under each fiscal year to meet the fund balance goal, ranging from $800,000 in FY 2005-06 to $475,000 in FY 2009-10. In addition, Mr. Martinez noted the FY 2005-06 projected budget did not include merit and compensation allocations; rather, they commenced in the FY 2006-07 budget. Finally, Mr. Martinez stated that though the city was currently in a growth mode, the five-year forecast could be subject to economic downturns. Staff then responded to questions from the Council. In conclusion, Mr. Martinez reviewed the preliminary budget calendar as follows: May 31 - City Manager submitted the FY 2005-06 proposed budget to the City Council; June 14 - General Fund overview; June 21 - Enterprise Fund overview; and June 28 - Other Funds overview; July 12 - public hearing on budget/summary discussion; July 19 - First Reading of Budget adoption ordinance; and July 26 - Second reading of Budget Adoption ordinance. Mayor Garrett called for a brief recess. After the recess, City Manager Noe discussed the status of the prior Council goals for 2003-05. As a general overview, Mr. Noe stated 18 goals were set during the last Council term. Of these 18, eight were continuing goals/issues and 10 were new priority issues. The eight continuing goals were as follows: charter revision; master drainage plan; Minutes - Council Retreat May 2, 2005 - Page 4 legislative agenda; Garwood water; increased CVB funding; new funding/inner city improvements; trashy neighborhoods; and improved permitting process. He said the goals were reviewed during mid-term, and a quarterly status report was issued during the budget report. The 10 new priorities were as follows: long-term revenue picture; Bond 2004; revitalize downtown/Bayfront initiatives; skate park; long-term storm water funding; ADA compliance; park master plan implementation communication with other taxing entities; revisit SOB ordinance; and call center for city services. Mr. Noe reported on the status of each goal, and then responded to Council members's questions. Mr. Scott Elliff, the retreat facilitator, led the discussion on the City Council's short and long- term goals for this term. He reviewed the group norms for the retreat. He explained that prior to the meeting, he had sent the Council members a questionnaire asking what they felt were ongoing key initiatives, critical issues to be addressed, and procedural issues to be addressed. (A copy of Mr. Elliff's report is attached.) Mr. Elliff reported the Council identified job growth development as a short-term priority issue. The Council also identified the following priority issues as long-term goals: downtown development; improved city/county relations; and intergovernmental relations. In addition, they identified three new goals as follows: infrastructure improvements; neighborhood affordable housing initiatives; and budget/finance processes and policies. Mr. Elliff asked the Council to develop achievable goals for each initiative that could be accomplished in a year. The Council then discussed those issues at length and city staff responded to Council members' questions. The Council also identified a number of other priority issues as follows: rethink/re-energize the recycling program; support TAMU-CC downtown campus; bring DMC agreement for joint use of the Fire Training facilities to Council; and receive plan from EDC for promotion of North Padre Island Drive for business development. Mr. Elliff stated the Council identified two possible procedural changes as follows: to change the start time of the Council meeting; and to reduce the number of Council members required to place an item on the agenda. The Council concurred that they did not wish to address these issues at this time. City Secretary Chapa discussed the Council meeting calendar for 2005-2006. The Council concurred to cancel the following meetings: August 9, August 16, November 22, November 29, December 27, 2005 and March 14, 2006. There being no further business to come before the Council, Mayor Garrett adjourned the Council retreat at 3:25 p.m. on May 2, 2005. * * * * * * * * * * * * * Corpus Christi City Council May 2, 2005 Retreat — Priority Focus Areas Downtown Vacant Buildings • Incentives for Development (e.g., New Market Tax Credits) • Specific building sale / use • Stringent code enforcement Shoreline Improvements • Compress timeline /fast track 1-37 — North • Leverage private development Coliseum • Process leading to re -use development decision by December 31, 2005 Job Growth / Attraction • Continually improve Development Services Infrastructure (Drainage, Sewer, Streets, Water) • Approved storm water master plan • Review airport project results to identify an additional undeveloped area to supply infrastructure for future development Neighborhoods • Implement plan for infill lots and affordable housing Budget / Finance Processes and Policies • Decision on Council Budget Policies and Priorities (e.g. tax increase limits, tax rate reductions, increased fire and protection) to influence five-year forecast Intergovernmental Relations • Set of jointly developed goals with Nueces County • Convening of area / regional elected officials / leaders around a topic of mutual interest Other Issues • Rethink / re-energize the Recycling Program • Support TAMU-CC Downtown Campus • Bring DMC agreement for joint use of Fire Training facilities to Council • Receive plan from EDC for promotion of North Padre Island Drive for business development