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Home My WebLink About04/15/2014 Council Presentation - FY2015 Manager Recommended BudgetFiscal Year 2014-2015 Recommended Operating Budget –General Fund Tuesday, April 15, 2014 Overview FY2015 Revenue Outlook  Investment Plan  Investment Summary  Overall General Fund Summary  Next steps  2 FY2015 Revenue Outlook 3 Arizona Economy Arizona Revenue Growth¹ Year Over Year Revenue Growth Actuals '07-'13 Forecast '14-17 15% 10.6% 10% 6.9% 6.4% 5.5% 5.3% 5.2% 4.0% 5% 6.7% 0% 20072008200920102011201220132014201520162017 -5% -4.6% -10% -10.3% -15% -18.2% -20% Note 1 -Data provided by JLBCrevenue update April10, 2014 4 Arizona Economy Projected Baseline State Budget Balances  FY2014 –$601M – FY2015 -$135M – FY2016 -$(221)M – U.S. Consumer Confidence 14.9%  (YoYFebruary 2014) U.S. Consumer Price Index (CPI) 1.1%  (YoYFebruary 2014) Unemployment  Rate – (azstats.gov for February 2014)  Arizona 7.5% (-0.5% YoY)   Tucson MSA 6.3% (-0.7% YoY)   Marana 5.5% (-0.1% YoY)  Single Family Housing Prices  (Median February 2014)  Tucson MSA= $158,000 (6% YoY) – 5 Sales Taxes $21.6 $22 $21.0 $20.7 $20.5 $20.5 $21 $19.4 $19.7 $20 $19 $17.7 $18 $17 $16 $15 2007-082008-092009-102010-112011-122012-132013-142014-15 EstimatedBudgeted* Change from FY2014 budget –8% or $1.5M*  Contracting -46% or $0.6M – Hotels* -25% or $0.2M – Utilities -3% or $0.1M – Retail -6% or $0.5M – All others -2% or $0.1M – Continued full allocation (75%) of contracting sales tax back to  the Transportation Fund 6 * Excludes $919K in discriminatory bed tax (2011-SB1460) which has been allocated to the Bed Tax Special Revenue Fund. Shared Revenues $8.8 $9 $8.2 $7.7 $7.5 $8 $6.9 $7.2 $6.5 $7 $5.7 $6 $5 $4 $3 $2 2007-082008-092009-102010-112011-122012-132013-142013-14 EstimatedBudgeted Change from FY2014 budget –7% or $0.5M  Shared sales tax -5% or $0.1M –  Urban revenue -9% or $0.3M –  Auto lieu -6% or $0.1M –  7 Licenses, Fees & Permits $5 $4.3 $3.9 $3.7 $4 $2.6 $2.7 $3 $2.2 $2.3 $2.0 $2 $1 $0 2007-082008-092009-102010-112011-122012-132013-142013-14 EstimatedBudgeted Change from FY2014 budget –  21% or $0.7M  Single Family Residence Building Permits By Fiscal Year Single family:  800 692 FY2014 –550 budgeted 600 – 550 436 FY2015 –600 budgeted 425 – 353 342 400 295 198 FY2015 –Increased  0 c ommercial development 2008200920102011201220132014BudgetBudget 20142015 8 Revenue Summary FY2015 RevenuesFY2014 Budget Recommended $ Change% Change Sales tax revenues $ 19,498,321 21,034,795 1,536,474 8% Intergovernmental revenue8,244,233 8,793,736 549,503 7% Licenses, fees & permits 3,194,225 3,857,453 663,228 21% Charges for services396,701 398,500 1,799 0% Fines and forfeiture625,000 595,000 (30,000)-5% Grants and contributions116,525 125,400 8,875 8% Investment Income 100,000 175,000 75,000 75% Miscellaneous revenues504,570 551,170 46,600 9% Total Revenue32,679,57535,531,054 2,851,479 9% General Fund Revenue by Major Category $40.0 $35.0 $30.0 $25.0 $20.0 $15.0 $10.0 $5.0 $- 2007-082008-092009-102010-112011-122012-132013-142014-15 EstimatedBudgeted* Sales TaxIntergovernmentalLicenses, Fees & PermitsOther 9 * Excludes $919K in discriminatory bed tax (2011-SB1460) which has been allocated to the Bed Tax Special Revenue Fund. Investment Plan 10 Investment Plan Combination of tools to retain and reward Marana’s talent Current Staff Resources & Strategic Key positions to Facilities, tools, Tools Positions complement and vehicles strategic used to objectives complete work (phased/Strategic assignments Plan) 11 Investment Summary 12 FY2015 Employee Investments Market adjustments-$472,000 ($537,000  Total) Market adjustments- – 2% pay adjustment applied to salary structure and employee base  pay Applies to all town employees except temporary seasonal staff and  employees whose salary falls above the maximum of the grade Maintains external competitiveness  Contributes to the Town’s strategic goal for attracting and retaining  quality professional staff. Special equity adjustments – ―Addresses severe compression resulting from the implementation of the classification and compensation study 13 FY2015 Employee Investments Cultural value excellence performance  awards -$150,000 ($162,000 All Funds) One-time adjustment in September 2014 – Re-introduction of performance based increases. – Eligibility applies to all classified, unclassified and term-limited – temporary employees hired on or before December 31, 2013 Excludes employees who have received formal disciplinary – action FY 14 Exceptional Achiever Award -$800 – Achiever Award-$400 – Pro-rated for part-time employees – 14 FY2015 Employee Investments Other pay and benefits  $168,000 ($174,000 Total) on other pay and benefits – (health, retirement, disability insurance, etc.) Training and development  $24,000 ($25,000 Total) employee training – Internal training and development program – Total investment = $814,000 ($898,000 All  Funds) 15 FY2015 Resources & Tools Investments Vehicle Replacements  $518,155 ($1,082,955 All Funds) – Technology  Applicant Tracking Software $14,000 – eCitationUnits (Phase III) $86,000 Other Funds – Facilities  Maintenance projects $366,000 GF – Shared use path preservation $135,000 – Equipment  Park utility vehicles, fleet tire equipment, mowers and – other items $187,5000 ($190,500 Total) Taser replacement $69,800 Other Funds – Total investment -$1,375,405($2,099,005 All  Funds) 16 FY2015 Selected Strategic Position Investments Police Officer (4 positions; 2 GF, 2 Grant Funds)  Maintenance Worker (2 Parks positions)  Tourism Development Manager (Bed Tax)  Senior Accountant  Well Production Supervisor (Water Utility)  Construction Inspector (Water Utility)  Water Reclamation Mechanic (Water Reclamation  Utility) Total investment -$823,300 ($1,519,650 All Funds)  17 Overall Financial Summary 18 FY2015 General Fund Summary FY2015 RevenuesFY2014 Budget Recommended $ Change% Change Sales tax revenues $ 19,498,321 21,034,795 1,536,474 8% Intergovernmental revenue8,244,233 8,793,736 549,503 7% Licenses, fees & permits 3,194,225 3,857,453 663,228 21% Charges for services396,701 398,500 1,799 0% Fines and forfeiture625,000 595,000 (30,000)-5% Grants and contributions116,525 125,400 8,875 8% Investment Income 100,000 175,000 75,000 75% Miscellaneous revenues504,570 551,170 46,600 9% Total Revenue32,679,57535,531,054 2,851,479 9% Expenditures Personnel & benefits 22,036,60223,779,642 1,743,040 8% Contracted services2,694,2133,520,625 826,412 31% Operating supplies & equip3,925,0924,478,436 553,344 14% Capital outlay1,298,032977,955 (320,077)-25% Total Expenditures$ 29,953,939 32,756,658 2,802,719 9% Over/(Under)$ 2,725,636 2,774,396 48,760 2% Other Sources and (Uses) Transfers out(2,725,636)(2,774,396)(48,760)2% Total Sources and (Uses)(2,725,636)(2,774,396)(48,760)2% Change in fund balance---0% 19 * Both the FY2014 and FY2015 budgets exclude contingency Operating Budget Impact on Reserves $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 2008-20092009-20102010-20112011-20122012-132013-142014-15 EstimatedBudgeted Fund BalanceRequired Reserve Established reserve policy target–25% of expenditures  Reserves are a one-time resource  Healthy reserves are required to:  Provide for overall cash needs (liquidity) – Provide capacity for major, unanticipated events – Maintain overall credit rating – Possible use of reserves  Heritage River Park Ranch Phase I -$6.5M – 20 Sewer line extension $7.8M (future developer/impact fees) – Next Steps DateArea May 20, 2014Considerthe approval of the tentative budget May 20, 2014Considerthe adoption of the changes to the comprehensive fee schedule and establish an effective date June 17, 2014Considerthe adoption of the final budget 21