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MADAM CLERK, CAN YOU PLEASE READ THE ROLL? SURE.SHE'S, SHE WILL BE PRESENT IN A MOMENT.
[3.a. AB 2971 Public hearing/discussion/possible action regarding approval of a Resolution adopting the City of Sedona’s Budget for Fiscal Year 2023-2024]
OKAY.SPECIAL BUSINESS AB UH, 29 71.
DISCUSSION, POSSIBLE ACTION REGARDING APPROVAL OF A RESOLUTION ADOPTING THE SEDONA, UH, CITY OF SEDONAS BUDGET FOR FISCAL YEAR 20 23, 24.
AND THAT WOULD BE SHERRY, YOU READY TO GO? GOOD AFTERNOON, MAYOR AND COUNCIL.
OKAY, SO WE ARE AT THE FINAL STAGE FOR OUR FISCAL YEAR 24 BUDGET.
THE FINAL BUDGET ADOPTION, UM, PROCESS STARTED BACK IN JANUARY.
AND, UM, SO IT IS A LENGTHY PROCESS THAT WE GO THROUGH TO, TO DEVELOP AND CREATE THIS BUDGET.
UM, WANT TO EXTEND THANKS AGAIN ON THE REVENUE FORECAST TO MICHELLE CONWAY AND CARRIE MEYER FOR, UH, HELPING WITH THOSE, UM, ASSUMPTIONS THAT WE USED AND ALSO TO THE COMMUNITY, UM, FOR THEIR PARTICIPATION IN THE SURVEY BUDGET SURVEY THAT WE DID AND TO OUR, UM, CITIZENS BUDGET WORK GROUP, UM, WHO WAS REALLY GREAT TO WORK WITH THIS, THIS YEAR.
AND THEY, UM, PROVIDED A LOT OF INFORMATION AND, AND A LOT OF TIME IN THIS PROCESS.
SO THE FISCAL YEAR 24 BUDGET IS BALANCED.
UM, THESE NUMBERS, UM, ESSENTIALLY ARE WHAT WAS PRESENTED IN THE, UM, TENTATIVE BUDGET ADOPTION.
UM, THERE WAS SOME ADJUSTMENTS AND I HAD ADJUSTED THE SLIDE, UM, TO THE, TO THESE NUMBERS.
SO THESE ARE THE SAME AS WHAT YOU SAW ON THE SLIDE FOR THE TENTATIVE, UM, ESTIMATING A, A STARTING BALANCE OF ABOUT 98 MILLION REVENUES OF 66 MILLION.
UM, NETTING OUT ALL THE VARIOUS POLICY RESERVES, UM, THAT WE WANT TO HAVE AT THE END OF THE FISCAL YEAR SO THAT THE RESOURCES AVAILABLE ARE 101 MILLION BUDGETING EXPENDITURES OF 85 FOR EXCESS RESOURCES AVAILABLE OF 15 MILLION.
SO ESSENTIALLY THAT MEANS THAT WE COULD HAVE BUDGETED 15 MILLION MORE AND STILL BEEN IN BALANCE.
UM, HERE IS THAT, UM, THE TRENDING OF THE PAST YEAR'S BUDGETS AND HOW THAT COMPARES.
UM, SO YOU CAN SEE THE ESTIMATED BALANCES OVER THE PAST SEVERAL YEARS.
THE REVENUES, THE POLICY RESERVE AMOUNTS, THIS TOTAL RESOURCES AVAILABLE.
SO 101 IS, UM, PRETTY SUBSTANTIAL COMPARED TO, UM, A FEW YEARS AGO WHEN WE WERE 60 AND, AND 71, UM, BUDGET EXPENDITURES, UM, COMPARISONS THERE.
SO WE DID COME DOWN FROM LAST YEAR AND THE EXCESS RESOURCE IS AVAILABLE.
SO THE 15 MILLION IS GETTING MORE BACK TOWARDS SOME OF THOSE PRIOR NUMBERS THAT WE HAD.
UM, AND THEN TAKING THE TOTAL, SO ALL OF THOSE RESERVES AND THE 15 MILLION PUTS US AT AN ESTIMATION OF ENDING FUND BALANCES OF SEVEN, 8 MILLION.
UM, LOOKING AT SOME OF THE HISTORY, UM, IN A GRAPHICAL PERSPECTIVE, SO HERE ARE THE BUDGET AMOUNTS ALL THE WAY BACK TO FISCAL YEAR 2006.
SO PRIOR EVEN TO THE GREAT RECESSION.
UM, THE, UH, KIND OF ORANGES LINE, THERE ARE THE ACTUAL EXPENDITURES.
SO YOU CAN SEE THAT EXPENDITURES WERE, UM, WELL UNDER THE BUDGET AMOUNTS EACH YEAR.
UM, AND THE GREEN LINE IS THE FUND BALANCES.
SO YOU CAN SEE THE, THE GREEN LINE IS ABOVE THE ORANGE LINE, ACTUAL EXPENDITURES.
SO WE'VE CONTINUED TO CARRY IN FUND BALANCES MORE THAN A YEAR'S WORTH OF EXPENDITURES.
UM, LITTLE CLOSE TO WHAT BUDGET NUMBERS ARE, BUT COMPARED TO EXPENDITURES, WE'VE GOT AMPLE AMOUNT IN FUND BALANCES.
AND THEN THIS KIND OF, I GUESS, BLACK LINE HERE, UM, ON THE OPERATING RESERVE AMOUNTS.
UM, SO YOU CAN SEE THE OPERATING RESERVE REQUIREMENTS ARE WELL UNDER WHAT THE FUND BALANCE NUMBERS ARE.
SO HERE'S A COMPARISON OF THE REVENUES, UH, BY FUND AND BY ONGOING REVENUES.
AND, UH, THE ONE TIME, UM, REVENUES.
SO OUR ESTIMATION IS A 6% DECREASE IN TOTAL REVENUES.
THE VAST MAJORITY OF THAT IS RELATED TO, UM, THE CONSERVATIVE ESTIMATES ON OUR SALES AND BED TAX.
UM, THE ECONOMISTS HAVE KIND OF FLIP FLOPPED ON WHETHER OR NOT THERE'S A RECESSION COMING.
MORE OF THEM ARE KIND OF LEANING TOWARDS, MAYBE THERE'S NOT A RECESSION COMING WHO, WHO KNOWS.
BUT IN THIS BEING CONSERVATIVE,
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WE'RE ESTIMATING A $15 MILLION SURPLUS.AND IF SALES BED TAXES COME IN STRONGER THAN THIS, IT JUST MEANS THAT WE'RE GONNA HAVE MORE IN SURPLUS, UM, THAN 15 MILLION.
SO, UM, THAT'S PRIMARILY WHERE THE DECREASE COMES IN.
THERE'S A FEW PLACES ON SOME OF LIKE THE OTHER INTERGOVERNMENTAL, SOME OF THE GRANTS THAT WE'RE GETTING THAT ARE, UM, A LITTLE BIT HIGHER DOLLAR AMOUNTS.
AND, UM, HERE'S SHOWING THE CHANGES FROM THE 70 MILLION IN THE FISCAL YEAR 23 BUDGET TO THE FISCAL YEAR 24 BUDGET OF THE 66.
UM, SOME OF THE INCREASES RELATED TO URBAN REVENUE SHARING, WHICH IS THE STATE SHARING THEIR INCOME TAX WITH US.
UM, AND, UM, THEY DEFINITELY HAD SEEN SOME VERY SIGNIFICANT INCREASES IN INCOME TAX REVENUE AND THEN THE VARIOUS GRANTS, UM, THAT WE'RE ALSO INCLUDING AS FAR AS EXPENDITURES BY FUND.
SO AGAIN HERE, UM, THE EXPENDITURES WE'RE LOOKING AT BUY FUND AND BY ONGOING AND ONE TIME, AND, UH, THE COMPARISON TO PRIOR YEAR IN TOTAL, GOING FROM THE 105 MILLION TO 85, UM, SO THAT IS SUPPOSED TO BE 19% DECREASE.
THAT NUMBER DID NOT GET UPDATED.
UM, SO SLIGHT DECREASE, AND THIS IS LOOKING AT BASED OFF OF THE ONGOING AND ONE TIME AND THE, THE VARIOUS CATEGORIES, PERSONNEL, OPERATIONS, DEBT SERVICE CAPITAL, SO OUR OPERATING PORTION OF OUR BUDGET, WHICH INCLUDES ALL THOSE PERSONNEL AND OPERATIONS AND DEBT SERVICE AND CONTINGENCIES.
SO THAT'S A TOTAL OF 52 MILLION.
AND THEN OUR CAPITAL IMPROVEMENTS BUDGET AT 33 FOR THE TOTAL OF THE 85 MILLION.
UM, AND AGAIN, AS A 19% DECREASE.
AND THE BIGGEST PART OF THE DECREASE IS RELATED TO THE CAPITAL IMPROVEMENT PROJECTS, PRIMARILY DUE TO THE PURCHASE, THE ACQUISITION OF THE CULTURAL PARK THAT WAS BUDGETED IN FISCAL YEAR 23.
THAT OBVIOUSLY DOESN'T OCCUR EVERY YEAR AS FAR AS THE SALARY AND BENEFIT CATEGORIES GOING FROM THE 18.9 TO THE 20000000.3.
AND SO THE VARIOUS ADJUSTMENTS HERE.
SO WE HAD SOME POSITIONS THAT WERE ADDED AND, UM, WAGE ADJUSTMENTS AND THEN SOME OF THE INCREASES IN THE BENEFITS, THE ONE-TIME ADDITIONAL P S P R S CONTRIBUTION.
SO IN FISCAL YEAR 23, COUNCIL HAD AUTHORIZED A ONE-TIME $1 MILLION TO BE CONTRIBUTED TO THAT, UM, UNFUNDED LIABILITY.
AND IN THE, UH, BUDGET PROCESS FOR FISCAL YEAR 24, COUNSEL SAID, LET'S DO 1.2 MILLION, UM, ONE TIME ALLOCATION TO THAT UNFUNDED LIABILITY.
SO THE ONETIME INCREASE BY 200,000.
UH, HERE'S A LIST OF THE DECISION PACKAGES FOR THE, UH, POSITIONS THAT WERE INCLUDED IN THE BUDGET.
UM, PRIMARILY THE, UH, MOTOR OFFICER POSITION.
AND, UM, THERE'S A TEMPORARY COURT CLERK, UM, TO HELP THE COURT GET CAUGHT UP ON SOME THINGS.
UH, OPERATIONS WENT FROM, UM, NOT QUITE 20 MILLION TO ABOUT 21 MILLION.
SOME OF THE BIGGEST THINGS HERE REALLY IS RELATED TO DECISION PACKAGES.
AND SO HERE'S THE LIST OF THE DECISION PACKAGE AMOUNTS THAT WERE INCLUDED.
UM, THE BIGGER ITEMS. SO THERE'S THE, UM, CULTURAL PARK MASTER PLAN, WHICH IS BASICALLY A C F A, UM, FOR THE CULTURAL PARK, UM, CONSULTING SERVICES FOR THAT, THE TOURISM DATA COLLECTION, UH, PROJECT TO GET SOME OF THAT INFORMATION TO IDENTIFY HOW MANY TOURISTS ARE WE REALLY GETTING AND, AND SOME OF THOSE DETAILS.
AND THE 400,000 FOR, UM, SETTING UP A SAFE PLACE TO PARK FOR C I P, UM, GOING FROM 56 MILLION TO 33 MILLION.
AND AGAIN, THE BIGGEST ITEM HERE IS THAT 20 MILLION DECREASE.
UM, THAT WAS IN THE 23 BUDGET FOR THE CULTURAL PARK DEBT SERVICE.
NOT SIGNIFICANT CHANGES HERE GOING FROM 7.8 7.4, UM, WHICH IS JUST REALLY THE, UM, IN FISCAL YEAR 23, THE FIRST BOND PAYMENT FOR THE SERIES 22 ALWAYS HAS SOME ACCRUED INTEREST BUILT INTO IT.
AND SO IT'S A LITTLE BIT HIGHER CONTINGENCY AMOUNTS GOING FROM 2.5 TO 3.4.
UM, PART OF THAT IS ADDING THE, UM, TOURISM INITIATIVES CONTINGENCY WHERE WE TOOK THE AMOUNT THAT WAS BUDGETED FOR THE, UH, CONTRACT WITH THE CHAMBER.
AND WE'VE ADJUSTED SOME OF THOSE, UM, BALANCES, UM, TO, UH, REFLECT SOME OF THE THINGS THAT WE ALREADY PUT IN THE TOURISM DATA COLLECTION AND THE POSITIONS FOR THE TOURISM ECONOMIC INITIATIVES, UM, DEPARTMENT.
AND, UM, THERE'S AN ADJUSTMENT FOR THE ARPA CONTINGENCY BASED OFF OF THE BALANCE THAT STILL HASN'T BEEN SPENT.
HERE'S THE, UM, TOTALS ON THOSE CONTINGENCY AMOUNTS.
SO IN THE GENERAL FUND, 900,000 IN THE GRANTS, UM, DONATIONS OF RESTRICTED FUNDS, SO 2.3 MILLION THERE AND
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A HUNDRED THOUSAND IN THE WASTEWATER FUND.UM, IN ADDITION TO ALL THE VARIOUS EXPENDITURES THAT WE'VE, WE'VE BUDGETED FOR, WE ALSO BUDGET FOR TRANSFERS BETWEEN FUNDS AND WE'VE BUDGETED FOR $35 MILLION WORTH OF TRANSFERS, 23 MILLION OF THAT COMING FROM THE GENERAL FUND TO GO TO OTHER FUNDS TO HELP SUPPORT THEM.
UM, SUPPORT FOR THE STREETS FUND BECAUSE THE GAS TAX DOLLARS THAT WE GET FROM THE STATE IS NOT ADEQUATE TO COVER THE STREETS COSTS.
UH, WE'RE PUTTING QUITE A BIT OF MONEY INTO THE HOUSING FUND AND, UM, MONEY IN THE CAPITAL IMPROVEMENTS AND WASTEWATER AS WELL AS FAR AS CAPITAL IMPROVEMENT PROJECTS.
SO HERE'S A SUMMARY BY THE VARIOUS CATEGORIES WITH SEDONA AND MOTION BEING THE LARGEST CATEGORY AND WASTEWATER BEING THE NEXT LARGEST.
UM, AND THE OF THIS AMOUNT, UM, THE 25 MILLION WAS, UM, CARRYOVER AMOUNTS THAT HAD BEEN, UM, APPROPRIATED AND THEN ADDING AT 8.6 MILLION, UM, TO THOSE PROJECTS OR ADDING NEW PROJECTS, LOOKING AT THE CAPITAL IMPROVEMENTS BASED OFF OF THE FUNDING SOURCES.
SO THE UNRESTRICTED MONIES, THE CAPITAL RESERVES IS A SMALL PORTION OF THIS TOTAL, SO 3.3 MILLION OUT OF THE $34 MILLION C I P BUDGET.
SO THE UNRESTRICTED MONIES THAT WE'RE HAVING TO CONTRIBUTE IS, IS PRETTY MINOR.
ALL THE REST IS RESTRICTED FUNDING.
THE LARGEST AMOUNT WOULD BE THE DEBT FINANCING, THE BALANCE OF THE 25 MILLION IN BONDS THAT WE HAD ISSUED, UM, BACK IN MARCH OF 2022.
UM, AND THEN WASTEWATER MONIES, UM, WOULD BE THE NEXT LARGEST AND THEN THE HALF SINCE SALES TAX SHERRY, HAVE WE SPENT ALL THAT BOND? NO, BUT WE'VE ALLOCATED IT TO PROGRAMS, CORRECT.
AND SO BASED ON WHAT WE HAVE IN THE BUDGET FOR FISCAL YEAR 24, IF ALL OF THAT STAYS ON TRACK THE WAY THAT IT'S BUDGETED, THEN WE WILL HAVE ALL THAT MONEY SPENT BY THE END OF FISCAL YEAR 24.
IS THAT OUR DEADLINE? NO, WE HAVE, UM, THREE YEARS.
SO IT WOULD BE, UM, THE END OF FEBRUARY, 2025 THAT WE WOULD HAVE TO HAVE THE MONEY SPENT BY.
SO WE'VE GOT SOME WIGGLE ROOM.
UM, AND I DON'T KNOW IF KURT HARRIS IS, I DON'T SEE KURT HARRIS HERE, BUT I HAVE TOLD HIM THAT I'M REALLY COUNTING ON THE FOREST ROAD TO NOT SEE TOO MANY DELAYS BECAUSE THAT'S GONNA BE THE ONE BIG PROJECT THAT'S REALLY GONNA HELP US GET THERE.
UM, SO AS FAR AS THE COUNCIL PRIORITIES THAT HAVE BEEN INCLUDED IN THE BUDGET, SO THIS IDENTIFIES ALL THOSE DOLLAR AMOUNTS RELATED TO THE PRIORITIES.
THERE ARE SOME CATEGORIES WHERE THERE'S NOT REALLY, UM, A DOLLAR AMOUNT ALLOCATED, JUST STAFF RESOURCES, JUST STAFF TIME THAT'S INVOLVED.
UM, SO EACH ONE OF THESE PRIORITIES DOES HAVE SOMETHING WITHIN THE BUDGET.
UM, THE SIM PROJECTS, TRAFFIC TRANSPORTATION IMPROVEMENTS, THAT'S ALL LOCATED IN C I P.
SO $20 MILLION THERE, GOT MONEY BOTH IN C I P AND OPERATIONS FOR TRANSIT.
UM, AS FAR AS THE, UM, HOUSING AND HOMELESSNESS INITIATIVES, SO THERE'S, UM, 950,000 IN THE OPERATION COSTS, UM, BUT NOT IN EXPENDITURES.
18.9 MILLION IS FOR BALANCE SHEET LOANS.
UM, SOME OF IT HAS BEEN LOANED, UM, FOR SUNSET LOFTS SO FAR.
UM, AND THE REMAINDER THAT, UM, HOPEFULLY THE PROJECT WILL MOVE FORWARD AND WE WILL CONTINUE TO PROVIDE MORE LOANS AND THEN AVAILABLE FOR OTHER PROJECTS.
UM, AND THEN THE NEXT PAGE, UM, ADDITIONAL, UM, PRIORITIES THAT ARE IDENTIFIED HERE.
SO IT WAS KIND OF A LONG LIST ON THE PRIORITIES, COULDN'T REALLY FIT THEM ALL ON ONE PAGE.
UM, SO IT SEPARATED BETWEEN, BETWEEN THE TWO.
UM, THIS SLIDE HERE IS JUST, UM, THE BASELINE OF THE LONG RANGE FORECAST.
UM, IN THE WORK SESSIONS WE PLAYED AROUND WITH DIFFERENT SCENARIOS OF WHAT IT MIGHT LOOK IF WE DID THIS OR THAT.
THIS IS BASED OFF OF THAT BASELINE WITH THE ADJUSTMENTS FOR THE BUDGET NUMBERS, UM, BUILT IN.
AND SO YOU CAN SEE FROM THE DOTTED BLACK LINE, WHICH IS OUR RESERVE REQUIREMENTS COMPARED TO THIS, THE BLACK BAR, WHICH IS WHAT WE'RE ESTIMATING THE FUND BALANCES TO BE, THAT UM, OUR FUND BALANCES ARE ESTIMATED TO BE WELL ABOVE WHAT THOSE RESERVE REQUIREMENTS ARE FOR EACH YEAR.
AND THAT'S INCLUDING THE BUILDING IN OF, OF A GUESS AT A RECESSION COMING.
SO WE'RE, WE'RE IN PRETTY, PRETTY STRONG SITUATION AS FAR AS LIKE ALL THOSE WHAT IFS IT WILL IMPACT THESE NUMBERS OF IF COUNSEL CHOOSES TO, UM, DO A VARIETY OF OTHER THINGS.
SO, UM, AFTER THE ALLOCATION, DURING THE BUDGET WORK SESSIONS OF 12 MILLION TO THE HOUSING FUND AND 1.2 MILLION AS A ONE-TIME
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CONTRIBUTION TO THE P S P AS UNFUNDED, THESE ARE THE REMAINING SURPLUS ESTIMATIONS.SO IT'LL BE A LITTLE BIT OF TIME BEFORE WE HAVE FINAL NUMBERS FOR FISCAL YEAR 23 THAT WE CAN REPORT ON WHAT THE FINAL SURPLUS NUMBER IS.
BUT RIGHT NOW OUR ESTIMATE IS THAT AFTER THE ALLOCATIONS THAT WERE DONE, THERE WOULD BE STILL 6.9 MILLION IN SURPLUS MONEY FOR 23, AND THEN FOR FISCAL YEAR 24, IT WOULD BE 1.8 MILLION.
DO I HAVE A MOTION? MAYOR, WE NEED TO OPEN THE PUBLIC HEARING.
OKAY, THEN WE'RE GONNA CLOSE THE PUBLIC HEARING.
NOW, DO WE HAVE A MOTION? CAN I MAKE A COMMENT FIRST? YOU CAN ABSOLUTELY MAKE A COMMENT FIRST.
SO I JUST WANNA COMMENT THAT THIS IS, I THINK THE, THE THIRD PUBLIC HEARING WE'VE HAD SINCE WE HAD THE TENTATIVE BUDGET, AND THERE HAS BEEN NO PUBLIC COMMENT AT ANY OF THOSE THREE PUBLIC HEARINGS, AND I JUST THINK IT'S IMPORTANT TO, TO NOTE THAT.
UM, AND THE OTHER COMMENT THAT I'D LIKE TO MAKE IS I REALLY WANNA THANK SHERRY FOR THESE VERY, I UNDERSTAND COMPLETE AND WELL PRESENTED INFORMATION THAT YOU'VE GIVEN US ALONG EVERY STEP OF THE PROCESS OVER A BASICALLY A YEAR LONG PROCESS.
SO THANK YOU FOR THAT VERY MUCH.
I APPRECIATE THE DETAIL THAT YOU PROVIDE TO US VICE MAYOR, IF NOBODY ELSE HAS ANY COMMENTS, I, I'LL MAKE A MOTION.
DOES ANYBODY ELSE WANNA SPEAK? OKAY, I MOVE TO APPROVE RESOLUTION AND NUMBER 2023 DASH 25 25, ADOPTING THE BUDGET FOR FISCAL YEAR 20 23 24, INCLUDING THE BUDGET ATTACHMENTS.
UH, ANY DISCUSSION? OKAY, ALL THOSE IN FAVOR SAY AYE.
ANY OPPOSED? WE ARE UNANIMOUS.
JOANNE, GOOD JOB, SHERRY, AND TEAM.
UM, HERE WE HAVE DISCUSSION ITEM D, DISCUSSION, POSSIBLE ACTION REGARDING FUTURE AGENDA ITEMS. I WILL DO IN THE NEXT SEC, UH, SESSION.
[5. Adjournment]
ANYTHING ELSE? HEARING NOTHING, WE WILL ADJOURN TILL FOUR 30.