AGENDA #1
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Public Hearing on the Recommended Budget and Capital Program
DATE: May 10, 2000
INTRODUCTION
The purpose of this memorandum is to provide background information for the Council’s public hearing on the recommended 2000-20001 budget, the 2000-2005 capital program and on use of transit grants and downtown service district taxes in 2000-2001.
We suggest that the Council receive comments tonight in a combined hearing format in which citizens may make comments regarding any one or more of the topics.
OVERVIEW OF THE TOWN’S BUDGET
Through the Town's annual budget process, the Town Council makes decisions on the level and types of services to citizens. The Town’s service year begins on July 1 in accord with State law.
Adoption of a budget determines in many respects the level of resources to be available for Town services over the coming budget year. Normally, there are limited options for adding to the budget after it is adopted.
The budget process is one of the most important functions and responsibilities of the Mayor and Council, and a key opportunity for citizens' participation in Town government.
BACKGROUND
Process for Participation by Citizens
In addition to the public hearing tonight, initial budget forums were held on January 25th and March 25th.
Citizens may make comments to the Mayor and Council by letter, fax, e-mail, etc. at any time in the budget process.
Notices of the budget forum and hearing were published in the Chapel Hill News on Friday, May 5 and Sunday, May 7. Letters inviting citizens to attend and speak at the forum were mailed last week to about 200 community organizations and community leaders. A copy of the notice is attached.
Council’s Budget Process
The Council held budget work sessions on February 16th, March 1st and 3rd, April 12th and 18th, and on May 3. The next work session is scheduled for May 17th and the Council may hold additional work sessions as needed.
The budget process adopted by the Council in September includes consideration of adopting a budget on June 12th. Under State law, the Council must adopt an annual budget or a temporary budget by July 1st.
SUMMARY OF THE RECOMMENDED BUDGET
Under the recommended 2000-2001 budget, most services would continue as at present, although two services would be changed:
· the proposed budget is based on implementation of once-weekly curbside collection of refuse using rollcarts, resulting in first-year savings of $53,000
· the recommended budget reduces the cost of providing Police School Resource Officers to $54,750 (25% of the estimated costs of four positions), held in reserve pending a decision by the Chapel Hill-Carrboro City Schools on the number of positions they wish to fund.
The General Fund tax rate would be increased by 2.5 cents from the present 52.4 cents to 54.9 cents, and the Transportation Fund tax rate would increase by .4 cents, resulting in a total tax rate of 59.2 cents (from 56.3 cents to 59.2 cents).
Key factors influencing the proposed tax rate are:
· continuation of most present General Fund services.
· additional debt service cost of $430,000 related to the 1996 bonds.
· implementation of phase II pay plan adjustments recommended by consultants.
· continuation of current Transportation services with higher costs for fuel and personnel
SUMMARY OF THE RECOMMENDED 5-YEAR CAPITAL PROGRAM
· $783,000,000 of small capital repair and maintenance projects with cash financing in 2000-2001 as part of the annual budget, including sidewalks/bikeways, energy efficiency improvements, extraordinary maintenance, small park projects, greenways, and renovations and improvements to Town facilities
· An overall total of $4.2 million in small, cash-financed capital repair and maintenance projects over 5 years.
· $13.5 million of projects, over five years, funded with bonds approved by the voters. Major projects would include:
Northern Community Center/Pool
Downtown streetscape improvements
Buying land for open space and greenways
Southern fire station and fire truck
Southern police substation
Sidewalk and curb and gutter installation
Replacing bridges
PROPOSED USE OF TRANSPORTATION GRANT FUNDS
· Operating Assistance
These funds would support services of the public transit system in the Chapel Hill/Carrboro area, which currently operates fifteen bus routes, demand responsive shared ride service and service for elderly and handicapped people.
The estimated amount of federal and State operating assistance to be requested for 2000-2001 is $1.3 million, or about 19% of the cost of the transit system.
· Capital Projects
Up to $280,000 of federal funds would be requested. . In addition, State grant funds would be requested to help cover matching costs. Proposed uses of grants are:
1) Replacing three lift-equipped vans and replace one maintenance truck
2) buying major spare parts such as engine and transmission rebuilds, air conditioning compressors, and bus tires.
· Planning
About $158,000 of federal funds would be requested for short-range transit planning projects such as service and fare analysis and monitoring of public transportation activities.
USE OF DOWNTOWN SERVICE DISTRICT TAXES
The Town Council established the Downtown Service District in 1989-90 to provide supplemental services in a special district under procedures in State law. Most property with Town Center zoning is in the service district. A few properties used only for residential purposes have been excluded through the Council’s decisions on the district boundary.
The current tax rate for the downtown district of 6.2 cents and interest income would produce about $46,000 in 2000-2001 about the same as in the current year.
State law requires using the district tax funds in accord with the Council's service plan for the downtown. The plan as amended in 1995 allows the Council flexibility to use these funds for any service permissible under State law for the Downtown Service District. For example, district tax funds could be used to supplement police protection or pay for additional streetscape projects or to purchase holiday decorations. These funds are now allocated for
• promotional events and publications,
• marketing,
• supplemental sidewalk cleaning, and
• downtown welcome center operations.
These services are provided through a performance agreement with the Chapel Hill Downtown Commission.
MANAGER’S PROCEDURAL RECOMMENDATION
That the Council refer comments and questions to the Manager for consideration and follow-up reports as needed in the budget process.
ATTACHMENTS
1. Copy of notice mailed to citizens regarding public hearing (p. 6)