02-14-2011 Council Minutes - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL. Monday, February 14, 2011 • 7:00 o' clock p.m. 16. 2010 FINANCIAL REPORT Olson noted the majority of the 2010 bills have now been paid and the rest should be paid by the end of February. At this time the expenditure budget is under budget by $188,506. The major reason for the decrease in the expenditures is a result of the actions taken by the police chief to reduce expenses. The police department was able to reduce part-time hours while maintaining control of overtime costs. In addition, fuel costs were slightly cheaper than they were the previous year. Four general fund departments are over budget and will require budget adjustments. Unemployment charges are responsible for the Administration Department being over budget. The law /legal services also exceeded its budget. Increased code enforcement, a personnel issue, increased costs associated with ordinance changes, and complex zoning applications account for the overage. The overage in human services was due to a budgeting error. The engineering department was also over budget. Commencing in 2011, engineering charges associated with planning, zoning and public works will be charged directly to the respective departments, which will allow for greater accountability by each department. The other departments were within budget. Olson noted that property taxes are the City's biggest revenue source and represents 65.6 percent of the general fund budget. Current year tax collections are at approximately 98 percent. When delinquent tax collections, penalties, and interest are included, tax collections are at 101.6 percent of the budget. Olson indicated they are budgeting less in 2011 than in 2010 for plan reviews. Olson noted plan reviews and permit revenues have been less than usual for the past three years due to the economy. In addition, the City's investments are generating less revenue, with the majority of them only paying one percent. Olson noted the City has been benefitting from the low interest rate they pay on their bonds. McMillan noted fines are up and asked what that consists of. Olson indicated the fines are the fines generated from tickets issued by the police department. Olson noted they budgeted $70,000 for investment interest in 2010. In 2011, that number was decreased to $30,000, which represents the one percent interest. Olson commented he has budgeted conservatively on revenues for 2011. Franchot asked whether the change in cash listed under funds is the number listed plus the depreciation number. Olson indicated the majority of it would be and that the rest is liabilities. Franchot noted $367,000 in expenses is listed under the sewer operating fund, and asked what that consists of. Olson stated that is allocated to the Metropolitan Council. Franchot suggested a footnote be added to that fund to denote that that money is allocated to the Metropolitan Council. Franchot commended Ron Olson for his good financial stewardship. Page 13 of 18