 But this fee for all rental, the rental car is $25,000. There's only one other rental. Let's think ahead. Good evening and welcome. We are continuing our coverage of Town Meeting 2019 here at Channel 17, Town Meeting Television. And in fact, I think we're about wrapping up two and a half, three weeks of coverage with South Burlington. Always one of our favorite guests to have. Thank you so much for joining us. Thank you, Lauren Glenn. We have Helen, really, who is the head of the City Council. And we have Tom, who is the, he's the man that makes things happen. He's the one that finds the typos. And I have a lot of admiration for you. So I think we're in good hands talking about the budget here. So why don't we just get right started and I'll let people know that our number is 862-3966. If you have any questions, we'd love to hear from you here on the set on the 25th of February. So, 2020 budget, whoever thought we would live this long. Here we are. Yeah. Well, still going strong here. Exactly. Yeah. So, all right. I'll let you... So why don't I just talk a little bit about the process we used and the Council provided Tom and Kevin guidance. We asked them back in September or October to really try to bring a budget in under a 3% increase. Okay. So that was kind of our caveat, which they achieved with a little to spare. And the other caveats were to make sure that we maintained the current level of services and that we could meet all the contractual obligations. We have three unions in the community. We need to meet all our bonded debt obligations, of course. And then several years ago, we developed a capital improvement plan, our CIP, and we wanted to make sure that there was money in that to support some of the items. I mean, it's a very long list, so you never can do all of them. And one very important piece that we discussed at length was increasing it back up to an $860,000 budget item for the Reserve Fund for the TIF so that we can continue to meet our bond obligations as we build out city projects in the TIF, like the road and the upcoming library and the park, but we'd have enough money to even out those payments. So we've been setting aside that money. We also wanted to make sure that the fund included, or the budget included, money to support the various organizations that we support, like Green Mountain Transit and CCTV, which we included a $10,000 increase. Regional planning, the Vermont League of Cities and Towns, the Winooski Valley Parks Department, those are some items that are important to us. And then we also identified some council initiatives that we wanted to make sure we were hoping that we could continue to fund. One was our affordable housing fund, so we were able to continue funding at $50,000. We looked at and from conversations with our very able and active energy committee, they were really interested in making sure that we committed the income from the solar landfill, that that's recommitted to kind of long-term efficiencies that then pay back. They save us money. That's the old dump, the landfill that you can see if you're driving along Airport Parkway near the wastewater plant. Yeah, we were the first one in the state to use those capped landfills to a positive purpose. We wanted to make sure there was some money going into our open space project funding and when we hired, we wanted to hire or think about personnel for really helping identify the energy efficiencies that would have sort of the biggest bang for the buck and organize that for the city. We really didn't have that staffing, so fortunately in this budget, they found was it $50,000? $40,000? $40,000 to fund a part-time person, so we're very encouraged that that will take us forward to really invest that money wisely and then continue to accrue efficiencies as we go forward in savings in our energy use. Fantastic. So those were sort of some of the major parameters and considerations and we were very happy that all of them, they could find money, they did find money for all of those and we kept the increase under 3%. I think another, I think it was stated, I was going to say unstated parameter, but something that's always in the back of our minds is to really be sensitive about the use of property taxes for city funding because we have other sources for some of our programming. The schools are stuck with, or their only source really now, is the property tax and we know that the school board is really working on, I think they have up to eight different iterations of what opportunities for future visioning for the schools in the city. So we really wanted to make sure that we continue to be very thoughtful and careful about using the property tax so they have the opportunity when they need it to ask for a big increase and we haven't sort of spoiled that for them. And that is reflected in the two ballot questions that you have. Absolutely. Which are, I would say, creative ways of financing road improvements and public projects. Correct. So we'll talk a little bit more about the ballot questions. But that's tied in. Exactly. So Tom, so that was your charge as the staff. That was the charge. All good things. So we can go back and look at some of the numbers as we look at the funds for 2020. The $60 million kind of ominous. It's a big number that's out there. But if you break that down, you see the next line is what percentage of that is actually the general fund. The rest of that $60 million includes all our enterprise funds. And we have three. We have stormwater, water, and sewer. And it also includes all our special funds and all the funding for Market Street and all our TIF money is all held within those special funds as well. So the big number is $60 million. But the real numbers, because those carry over from year to year, the real numbers in the general fund include the expenditures at about $24.5 million. And then the general fund revenues which are about $8.5 million. If you subtract the revenues from the expenditures, you have what's called the tax levy. And that's just over $16 million. That's what the tax is based on. And the tax rate increase with that amount of money which is just over $800,000, $854,000 gives us a rate, a tax rate increase of 2.84%. That's a little under a cent and a half on the tax rate. And that leaves us a proposed tax rate of .5382. And how do you, when a person looks at that and they say my house is worth $350,000, how much are my taxes are going to go up? Yes. How does that... That's a great question. So we do have a separate slide on that that will address that because it's probably the most common question that we get. What does that mean to me? How much is this going to cost me? So we'll get to that in just a bit. I want to just talk a little bit about some of the expense factors. Of course a good part of what's in the expenses is support for the capital improvement plan. And these are any expenditures that are over $10,000. A lot of our fleet, trucks, vehicles, police cars, any improvements that are made to our fire engines and those kinds of things, those are all lumped into there. All our paving costs, you know, things that are substantial. I'll go into the CIP, the Capital Improvement Plan. Another major expense factor for us is the pension contribution. This year that equated to about 6%, which is still pretty significant. Our pension contribution is just over $2 million between what we allocate for the contribution and what we pay towards the loan that we have. Have you run into the same problem the state has? Have you underfunded that for any period of time? Well, that's what the loan was taken out for back in 2012. We were. It was underfunded back in 2012. And that's what the loan kind of brought us up to the 100% funded level. And we've been able to maintain a good level of funding for it. But that's, that loan is a 20-year loan that we took out back in 2012. And that's about a $600,000 payment a year in addition to our contribution for the pension program, which puts us up around $2 million. The health insurance cost is another major factor, and that again is about a $2 million expense in the general fund. And what are you estimating that will go up? About 6%. Yeah, okay. Projected agreements with the three collective bargaining units are figured in there, but we're still in negotiation with two of the bargaining units, even at this point in this current fiscal year. These go back to July 1st of 2018. And for the most part, our three-year agreement. So we hope to conclude our agreements with the other two units soon. The funding level for City Center Reserve Funds, Helen spoke to that earlier. We're looking to bring that $750,000, which we had to cut it back to last year to make the budget work. We're adding that back in to this year's budget to the funding level that had been created at $860,000. And then we are proposing several new staff positions for this year. Proposed as two new firefighters. Anybody that looks at the actuals for 2018 can see that we have a significant amount of overtime in the fire budget. And we have mandatory staffing there where there always has to be eight firefighters on duty. So that number was significant enough for us to look at this past year and say, we got to look at this. And we felt that this would not only reduce the overtime budget, but it would also take a load off the guys needing to come back in shift after shift and the wear and tear on their bodies and the time commitment that they were needing to make. So we think this is a good thing. And this was a budget year that that fit into. And so we're excited that we're going to be bringing staffing to 10 firefighters per shift right now of men and women on duty. And we have three different shifts. They work 24-hour shifts. We anticipate some savings in overtime to help defer that. Although clearly hiring two people is expensive and an ongoing commitment of a considerable amount of money. We're not going to save enough in overtime to pay for them. Hence, that was part of the increase that we needed. It will probably pay the salary dollars, but when you add the long-term benefit cost in there as well, and Helen makes a good point that that's an additional expense. But I think it really brings us to the proper staffing level that we should be at in fire. And we are hiring a new staff person in IT. And our IT system network administrator is retiring, and he's been outstanding. So he's going to be hard to replace, but we'll have a new person coming on that will work with him for a while and then eventually take his position. So talk about some of the revenue factors here. Grand list growth is projected to be at about 1.5%, which is excellent. That's double what we had last year. And where is that growth coming from? New development within the city, and our assessor goes out and makes those estimations, and he'll be going back out to refine that number for us as of April 1st. What else is new on the ground out there? And then come back to the state with a revised assessment by the end of June that finalizes what our actual tax rate will be. The budget also includes some grant money and some impact fee money for various projects. Some of that money comes from the state. The revenue budget itself is relatively neutral. I think there's only about a $26,000 shift to the good in terms of what we'll be bringing in for revenue, but most items are up or down a little bit. It's kind of cost-neutral. And then we have the use of allocation from approved bonding from projects that the voters supported already, the communications bond, the open space projects, and the most recent penny for pass that was passed back last August. I remember that last year you were concerned that there wasn't enough money for the capital improvements. Is that right? It was kind of, it was an under, it was not a budget you were thrilled about, but you wanted to keep it affordable. Right. So many of the expense factors that are more limited this year that we talked about last year brought us to a level that we had to make some significant cuts. I think we were about a million dollars over where the council wanted us to be with our initial draft of the budget. And that forced us to begin looking at the capital improvement plan and what could be delayed a year or what could be shifted between a couple of fiscal years. And we were able to do some of that in the majority of the rest of it we picked up this year as part of the funding. So I think we're on track now with the CIP at a good funding level. And I expect moving forward that we'll be pretty consistent with the amount that's budgeted for this year. And again, CIP means your capital improvement plan. Capital improvement plan, yeah. Well, we had a, we were lucky, I think the health cost increase was a little bit less than last year. I mean, that just goes all over. It depends on who's pushing which buttons about health care reform, I think. Well, it could be 10%. I mean, the fact that it's a 6% increase that's a pretty significant savings. Yeah, and it was 12 last year. So that was a big chunk of money. Not a million dollars, but it was significant. So it all adds up. Some of the additional factors, we are deferring a few of the projects in the CIP, the garage down at Public Works. We're going to spread over two fiscal years, mainly because there's not an urgency to do it. We just want to shift some of the costs so that it doesn't all happen in one year. We don't have a stabilization fund that's been established. And our auditor, it's kind of the fund balance, how much money you have in the fund balance. Right now, we're at about 1.4 million. The auditor would like to see about 2.2 million dollars on there. So we're working towards that, but there's not a specific line item in this budget that says this is for a stabilization fund and will automatically go right on the balance sheet. What we've been doing is any money left from the general fund has gone on to the balance sheet that's brought us to the level of bringing us at least two thirds of the way of where we need to be. I can't remember. I said a month if all of our funding... It's just about 30 days worth of emergency funding. A whole lot. Based on our expenditure. Auditors like to see that kind of... They do. They do. But it's good practice. It is. That's what you're always driving for. So we're making progress towards it, but there's not a specific amount set in the budget to get us there. And then we have a long-term liability with some of our sick bank. We have some employees that have been with us for many years, and we're trying to cap the amount of sick time. So we're continuing to work through the bargaining negotiations with our bargaining units to try to bring that under control somewhat and reduce that long-term liability. So it rotates. It goes over a year. In other words, people... If your time carries. Yeah, it does. Yeah, it does. It does. City services. Yeah, the next slide here kind of... This is what we do on the municipal level, and you can see it all here. I won't read through it, but one of the questions that also comes to us quite frequently is how much of my tax money actually goes to the municipal part of the services. And so 25 cents out of every dollar is the answer to that. So 25% of any amount of money that people pay in taxes goes for these municipal services. And back to your question, Lauren Glenn. Here's what it actually means to the homeowner and to the condo owner. So the city tax rate increase this year is made up of two factors, one of which was approved last August by the voters, about 73%, I think. Yeah, it was a very strong vote. And that was the penny for pass for that infrastructure. The second factor for the rate increase this year is the proposed budget. That's the 2.84% increase. If you just figure that part of it into this, because that's the only thing that the voters are actually voting on is the budget increase. The penny for pass is already figured in, even though it doesn't affect them until the July 1 tax bill. So in terms of the proposed budget, for an average condo that valued at $232,790, that's about $34 annually, $2.83 a month. And for a primary residence, valued at almost $338,000, that's about a $50 annual increase, $4.11 per month. And that was when you said you wanted a 3%. You didn't want to increase the budget over 3%. You're very conscious of that number, I'm sure. Because that's what you hear about from your constituents. Right. And we understand that they look at that number for city services, but then there's a similar number for school, and that's 75% of the property taxes. So it does become real money. Yeah, I understand. Right. So the tax rate history. Yeah, that gives you an idea over the last 10 years. The difference in 2019, 2020, the red line is actually the increase in the general fund budget. And the blue line equals the tax rate increase for the budget plus what was approved last August for the penny for pass. And then of course we have our utility rates. These are enterprise funds. And each of the funds is proposing a small increase that would equal a total of $17.48 for the year, $1.46 on a monthly basis. Is that on a condo level or a house level? That's per user. Oh, per user? It doesn't differ. That's nothing to do. Yeah, I understand. So per household. So those are all user fees based, rather than tax dollars. Got it. Thank you for clarifying that. And then we get into some of our city ballot. Did you want to talk about the voting day first? Sure. Yeah, yeah. So early voting is going on right now and it's available until noon on Monday, March 4th, the day before town meeting. And then we have a pre-town meeting on Monday the 4th that evening where you can hear this all again. And then you can also hear from the school board and then from the candidates for school board and city council, only one of whom has opposition. And then the polls on town meeting day, Tuesday, March 5th are 7-7. And there are three polling places. There are three polling places, Orchard School, Markcott Central, Chamberlain and the Middle School. Got it. And we have copies of our city and school district budgets. This is on our website. It's also available to anyone who would like to have a copy mailed to them. Just call the city manager's office and we'll send a copy to any of the residents who would desire a copy of the whole booklet. And I also brought a copy of our ballot. I like the color. I know you want to talk more about it. That is your shirt. Yes, that's right. I color coordinated with our ballot today. And it's on both sides, so you have to remember to turn it over. Both sides, that's right. That's right. So why don't we just run through them in our last five minutes and we'll have for the articles. So we have the elected positions. The two incumbents, Tim Barrett and Dave Kaufman are running. Tim Barrett has opposition. Frank Davis. And then for school board, it's Brian Minier and Martin Lalonde, neither of whom are running opposed. So there's not a whole lot of choice, although you can always write in. And can I just ask a question? David Kaufman, is he running for Pat Nowak's seat? Yes, he was appointed to fill that out. And at the time he said, no, I'll just fill it. And then he's added a lot in my opinion to the council and he decided he'd really, really liked it. So he'd run again. So he's running for the two year and Tim is running and Frank are running for a three year term. Then the article two is really approving the budget of $60 million of which 16 million and change will be raised by the local property tax. So that's a yes or no. Then we are offering two other articles that would amend the city charter. And the first one, article three, the first amendment to the charter is looking at raising the local options tax which would include sales, rooms, meals and alcohol. Raising that, which is, well, the sales tax is 7%. That's right, but the local option part of that is just 1%. And we're asking the public in many ways it's a referendum, would you consider asking the legislature to allow us to amend our charter to give us the ability to raise that local option tax 1%. And so it's sort of a three part issue. This is the first, the city council said yes, let's ask the public, we don't know. It sounds like a good idea to fund some of the specific public projects that people have indicated they were interested in, both in surveys as well as meetings and discussions about what do we want to grow or build for public amenities for the community. So the first question is, do you approve going to the legislature specifically to ask them, can we raise this? And then it also specifically says that if that is voted in the affirmative, it then goes to the legislature if they vote in the affirmative in both houses, and then it goes to the governor and the governor signs the bill, then that would allow the city of South Burlington to go back to the public and say we have a project that we would like to dedicate this money to rather than charge it to the property tax because we really want to reserve that for the schools. So it won't kick in unless there's a project? It won't kick in unless there's an affirmative vote for a project by the community. And we also may, at that point, understanding what the cost of the project is, we may say, well, you know, it only has to be half a percent, or we're only going to charge rooms and meals and alcohol, or we're only going to add it to the sales tax. So there's a lot of flexibility. So it's really a referendum for the public to tell us do you want to look creatively at some other taxes. And one of the things Tom said is these are likely to be more regional projects, so it makes sense to take advantage of the regional audience who pays these kinds of taxes. So we have a short time left. And then the last one is a short-term car rental tax. That's half a percent on all the tax, the car rentals for pleasure, not trucks or those kinds of things that are rented in the city of South Burlington, which does include the airport. And those dollars, if the community says yes, it then goes to the legislature. If they say yes and the governor says yes, then we can assess this half a percent, or half a percent, I guess it is, and utilize those dollars only for maintenance and road improvements. And, you know, as everyone knows, South Burlington is a pass-through community. We get an enormous amount of cars and trucks coming through. And this winter is a good example of why we need to start really looking at where we're going to find the money to improve our roads or fix them, just get them up to a drivable level. So this is one of those options. The last one is a non-binding resolution on increasing the smoking age to 21. And then with that, I'm going to wrap us up, and thank you both for joining us. Oh, you're very welcome. Thank you. We've been talking about the city of South Burlington budget and ballot questions, and we are so glad you could join us and stay tuned for coverage of the city council candidates. Thanks for joining us. Well, thank you very much, and make sure you vote, people. Exactly. Thanks.