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Expenditures <br />The draft expenditure budget reflects an increase of $320,883 (3.87%). The expenditure section <br />of the Major Budget Impacts (attachment F) lists expenditure increases and decreases of $5,000 or <br />more. <br />At 64% of the budget, wages and benefits have the greatest impact on the General Fund budget. <br />2018 is the second year of a three year labor contract with both the Sergeants and Patrol Officers. <br />In accordance with the contracts there is a 2.5% increase budgeted in addition to eligible officers <br />who are to receive step increases per union contract. Assuming a 2.5% increase, the budget impact <br />would be $60,222. In addition to possible union wage increases, many employees are due for step <br />or longevity increases. There are two new employee unions and contract negations are still under <br />way. There is a 2.5% increase planned in the 2018 budget. The budget impact would be $30,000. <br />Additional increases for those eligible for a step increase based on the new wage scale adopted in <br />2016. The process of adopting the new scale brought to light that the City's wages were falling <br />behind other city's pay. An annual COLA increase can help to keep the city competitive with <br />other cities in attracting quality staff. Finally, the Council will need to determine the size of a <br />COLA increase for non-union employees. <br />Workers compensation is estimated to increase between 3-6%, we still are waiting for those <br />numbers. Our experience modification factor is projected (subject to change) to go down from 1.0 <br />to 0.93. <br />The increase in wages is spread throughout the General Fund budget. On a department level the <br />following departments have significant budget increases regarding wages. The Administration <br />budget, a new City Administrator will start at the end of August. He will be full-time whereas the <br />prior administrator was not. Additionally he is starting at a higher step than the prior administrator. <br />The budget impact would be about $22,000. The Building & Zoning department a proposed new <br />hire of a Code Enforcement position. That position is budgeted at about $45,000. Finally the Golf <br />Course, a proposed full-time Golf Course/Parks Supervisor, which is budgeted at $58,672. The <br />Council should decide if they would like to move forward with these new positions. <br />Central Services is projected to decrease by $7,100. A decrease in repairs and maintenance of <br />Equipment, decreases to the office supplies and Internet/other communication. Additionally the <br />Building & Zoning department increased its software licensing for the Citizen Serve Software <br />($15,600). Similar to other software companies' licenses must be renewed annually. Additionally <br />$5,000 was budgeted in Building & Zoning to cover bank fees associated with taking on-line <br />payments through Citizen Serve. <br />The Police Budget is projected to increase by $35,487. As discussed with wages, the scheduled <br />step/longevity increases will result in an increase of approximately $39,000. The other significant <br />increase in the department is the result of the police records system that will be upgraded. The <br />upgrade will result in a $16,331 increase to the LOGIS Applications line item. <br />The Parks Department is requesting a budget increase of $12,211. The main increases ($5,000) is <br />in miscellaneous supplies for Park Commission initiatives. Maintenance Building and ground line <br />item is also going up ($5,220) to more accurately reflect current maintenance levels. The major <br />costs in the line item are: Mowing, Big Island Docks and Tree Trimming. Also $1,000 for <br />