The August ritual began anew Thursday morning in Jacksonville’s City Hall, with the City Council Finance Committee beginning its review of the Mayor’s proposed budget.
The day began with a romp through a presentation from the Curry administration, followed by the Council Auditor’s review of the budget.
The proposed $1.27B budget is up from the $1.2B budget the previous year, with highlighted adds including 100 new cops, 42 new fire and rescue workers, contingency accounts for raises, and augmented reserve levels.
There are caveats even in those employee adds: 80 new cops are funded for six months, and 20 are unfunded altogether.
Throughout the three-hour plus opening session, the budget was reviewed holistically, with some tweaks from the Council Auditor approved without discussion, and others occasioning much debate.
Finance Chair Garrett Dennis kicked off the meeting with props: a ruler and sharpened pencils, to facilitate a sharp review.
And his words were as sharp as those No. 2 pencils : Dennis said that all of Jacksonville needed to be represented in the budget, suggesting that last year’s $8M Council Contingency may not be so robust this year.
Dennis also suggested that there’s “new information” to consider as part of the budget process.
Tension erupted early with visiting Councilor John Crescimbeni questioning Dennis’ decision to not consider enhancements and adjustments as the process went on, rather than at the end.
“I’m specifically talking about enhancements,” Dennis said.
Chief Administrative Officer Sam Mousa introduced Curry’s “thoughtful and conservative budget,” noting that the administration has been working with the Council Auditor.
Some recommendations from the auditor are fine, Mousa said. Others require “dialogue.”
Mousa noted that pension reform was key to solvency, including maintaining employee cap and fulfilling capital improvements.
“We are now able to look forward to enhancements and improvements, many of which have been overdue,” Mousa said.
Mousa noted the public safety enhancements, $60M set aside for pension allocation, and an enhanced emergency reserve to 6 percent. As well, $32M will be allocated to vehicle replacement, most of which will be paid for via cash.
“The CIP begins to address needed improvements,” Mousa said, throughout the city. Fire stations and equipment: in the CIP, as is a $50M “Safer Neighborhoods” program that includes $8.4M for Edward Waters College.
Mousa noted that any borrowing falls “well within our debt authority guidelines,” with current borrowing getting “positive ratings from bond agencies,” which in turn decreases borrowing costs.
Mousa also referenced Finance Chairman Garrett Dennis’s promise to press departments on equal opportunity provisions, noting that an ordinance went into effect this year, and other steps are being and have been taken to comply with that ordinance.
Mousa also noted that Better Jacksonville Plan paydown is going very well. Once BJP is retired, of course, the half-cent sales tax moves over to address the city’s unfunded pension liability of $2.7B.
“Better Jacksonville’s looking good,” Mousa said.
Also discussed: budgets for the Jacksonville Journey and Jacksonville Children’s Commission, which will both be phased out, with functions rolled into the Kids Hope Alliance proposal.
The Journey and JCC budgets are combined this year, a reflection of the re-org.
Some positives in ad valorem were discussed by the Council Auditor: an estimated $45M revenue increase, of a total expected revenue of $625M, a 6.45 percent increase that reflects the property bubble at the late-stage in the current cycle of economic expansion driven by monetary-supply manipulation.
This increase helps to drive the total increase of 166 employees, bringing the city to 7,310 total, in addition to the capital improvements.
“That’s mostly police and fire positions,” Council Auditor Kyle Billy noted.
Salaries are up, almost 8 percent ($28.331M). New public safety employees and collectively bargained wage hikes drive most of the rise. Personnel costs are down $80M, $79M of that from decreased defined benefit pension contributions, offset by $4M to the defined contribution plan to new hires.
Group hospitalization costs: down nearly $10M, due to switches to self-insurance plans.
“The city’s had really good experience with self-insurance,” Billy said, and he proposed five contribution “holidays” to use up reserves.
A list of ten Council Auditor recommendations were considered, and most of them were approved without objection. These boost the council contingency by $1.332M.
As well, a talking point was the torpor of FEMA reimbursements post-Matthew, regarding $7M for an emergency incidents contingency.
“It can take years,” Billy said.
That didn’t mollify some committee members, who speculated about there perhaps being shortfalls in the city’s applications.
Discussion continued with concerns about loans to enterprise funds, including a $3M loan to Solid Waste. The Council Auditor suggested fee raises to offset these loans.
“Solid waste is in a state of flux,” Mousa said, noting the city’s recycling contract is ending and the city will no longer get paid for recycled waste.
Recycling isn’t paying off right now, Mousa said, because of an oil glut.
“We do not have a timeline of what the future of recycling will bring,” Mousa said.
Stormwater also needs a $2.3M loan, and a fee increase is not appropriate or timely, Mousa said.
The loans were approved, and the auditor recommendation was spiked.
In another bit of intrigue, Councilman John Crescimbeni noted that he may want to revisit the Cultural Council’s budget based on “some things [he] heard.”
He was told he’d be afforded the opportunity to do that, but the timing is still up in the air as of when.
Discussion also ensued as to Council members’ salaries, which were reduced by 2 percent in FY 2010-11.
Councilman Matt Schellenberg motioned to bump the salaries up to pre-FY 2010-11 levels, and that motion was quickly adopted by the committee “to be in compliance with the state statute.”
Borrowing money for capital offered controversy eventually, via: $9.7M for fire and rescue vehicles, as part of the Safe Neighborhoods plan.
The Council Auditor wanted to eliminate or reduce borrowing; CFO Mike Weinstein said that the Mayor’s Office agrees with the recommendation, conceptually.
Weinstein believes that the administration could move to 100 percent pay-go in three to five years.
Weinstein got pushback, with Matt Schellenberg noting that the homestead exemption hit could impact budgets.
The recommendation is conceptually approved; the trick will be, of course, finding the money in the budget to offset proposed borrowing.
Notable: the $9.7M is a hard cap without further legislation.
Fee reviews: also a talking point, with the Council Auditor wanting waiver language to be consistent with the ordinance code.
Weinstein said there were too many fees and not enough time to get a handle on them before budget, with a promise to come back with an updated fee analysis in a few months.
Councilwoman Lori Boyer backed the play, seeking an amendment to give the administration a December 15 deadline, which would lock fees into the FY 16/17 level in the short term.
Weinstein believes the fee process is “outdated” and “can be improved greatly,” but it will take time — with over 100 fees to mull.
“Dec. 15 is not doable,” Mousa said. “The fee structure is messed up.”
Current ordinance doesn’t include all the fees, for one thing. The administration has finally listed and cataloged a “comprehensive” list of current fees, per Mousa.
An ordinance will be filed setting fees to the level they are on the city’s website, as municipal code on fees is outdated.
Mousa proposed bringing a more complete schematic to the Finance Committee later this year.
Boyer pushed back, saying that in previous years a list was provided, and she wanted a list to review.
“There’s hundreds of fees out there,” Councilman Matt Schellenberg said, urging a “complete review by the first quarter of next year.”
In total, there are 58 pages of fees.
“I don’t want to be in this position next year in the budget,” Boyer contended.
Chairman Dennis wants to ensure that fees cover costs, decreasing the need to borrow to cover shortfalls.
Fees will, for now, stay at current FY levels.
The magic and mystery continue Thursday afternoon with a romp through Jacksonville’s police and fire & rescue budgets.