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July 1,
2004
Honorable
Mayor and Members of the City Commission
City of Lauderhill, Florida
In accordance with Article VI, Section 6.06 (e) and Article IX,
Section 9.01 of the Charter of the City of Lauderhill, I am pleased to submit a
balanced city manager’s proposed budget for fiscal year 2005. This proposed
budget includes recommended revenues and expenditures for the period covering
October 1, 2004 through September 30, 2005, and is submitted for your review and
consideration.
The goal of this message is to provide information on past and
current trends that contribute to the implementation of all major programs and
services provided by the city. The goal of the budget is to provide sound
fiscal management by allocating resources to those programs and services that
achieve the city’s mission. This document will review the city’s major programs
and services, and the funding sources necessary to provide them.
Budget Highlights
I am excited to be a part of the renaissance of Lauderhill. The
efforts of the city and county staff on the redevelopment of State Road 7 and
the regional park will generate more than $100 million in development in the
near future. Improvements such as the Carishoca Market Place, a 150-room hotel
and approximately 100 single family homes are scheduled for phase one of the
State Road 7 redevelopment project. These improvements, coupled with
landscaping and entranceway features, will greatly improve the appearance of our
State Road 7 corridor; which translates to increased economic development,
increased property values and ultimately additional tax revenues. Another
example of our transformation is the construction of our new police station,
county library, and Publix shopping plaza located on Oakland Park Boulevard.
These projects are examples of the city's new development standard and
philosophy.
As we move into fiscal year 2005, we will continue our efforts to
bring Cricket World Cup 2007 to the City of Lauderhill and work to develop micro
businesses. Other initiatives include the continued investment in our
infrastructure to ensure a clean, safe, and aesthetically pleasing community.
The city is continuing to move forward with its renaissance; however, as
mentioned in previous budget messages, we are at a financial and policy
crossroad. Outlined are the major factors that contributed to the development of
this budget.
General Government Services
I am proposing the addition of four (4) new police officers.
This will bring our total complement of certified police officers to 104. These
are the only new positions proposed in this budget. As you know, last year the
commission approved five (5) new police positions contingent upon receiving
grant funding. Unfortunately, we were not awarded the grant. Consequently,
during fiscal year 2004, we only filled two positions, which were funded by the
city’s budgeted salary match. These additions resulted in our current
complement of 100 officers.
To further the economic growth of the city, I am supporting the
establishment of the Lauderhill Chamber of Commerce, which will oversee business
development and retention. As a result, I am proposing the dissolution of the
Economic Development Department. Two new divisions were created in its place.
The first is the Office of Neighborhood and Business Enrichment, which will
operate under the direction of the Finance Department. Its primary
responsibilities will include grants procurement and management, neighborhood
and business enrichment and housing. The second is the Office of Project and
Program Development, which will operate under the direction of Administration.
Its primary responsibilities include coordinating and enhancing the city’s image
through special projects and events and tourism development, as well as public
relations.
The city continues to receive double digit increases to its
insurance costs. Our projected increase for fiscal year 2005 is twenty percent
(20%). This equates to an overall increase of approximately $400,000 for the
fourth consecutive year. Historically, the city has budgeted insurance costs to
a separate Insurance Service Fund, which was previously allocated to the
General, Water and Sewer, and Stormwater funds. During the six month budget
review of fiscal year 2004, the Insurance Service Fund was dissolved and the
cost of insurance policies were charged to the Human Resources Department while
actual insurance claims are charged directly to the originating department.
This practice will continue during fiscal year 2005.
Salary and benefit costs continue to rise at a pace greater than
projected revenues. Pension costs for the city’s four pension funds average
16.5 percent of payroll or $2,326,929. This is up from 13 percent or $
1,833,338, from last year. The additional costs are attributed to salary and
benefit increases based on collective bargaining agreements.
Debt Management
During fiscal year 2005 the city is required to make $3.8 million
in principal and interest payments for its outstanding debt. This represents an
increase of $2.2 million over fiscal year 2004. The specifics relating to the
increased payments are outlined in the debt management section of this message.
Capital Improvements
Planned redevelopment of our major thoroughfares is a priority
that is addressed. The commission approved an inter-local agreement with
Broward County on June 14, 2004, to contribute $4.2 million to the State Road 7
Beautification Initiative. Also, the proposed capital improvement plan includes
an additional $8 million for citywide beautification.
This budget includes a $2 million capital investment toward the
development of an arts and cultural center that will accommodate between 1,000
and 1,500 permanent seats. We will continue to work with the County in the
development of a state-of-the art, main event field. Both the cultural center
and event field are scheduled for construction in the planned county regional
park.
In summary, I am proposing the following to pay for the
aforementioned new positions, enhanced programs and services, increased debt
service payments, and capital projects. I am proposing that we increase the ad
valorem rate from $5.82 to $6.32 per $1,000 of assessed valuation; fire rescue
fee from $98 to $142 per year for all residential properties; the fixed water
and sewer fee from $6.65 to $10.00; the monthly stormwater fee from $6 to $8;
the delinquent utility payment assessment fee from 2 percent of outstanding
utility charges to 4 percent of outstanding utility charges. In addition, I am
proposing that we issue a $5 million Water and Sewer Revenue Bond and a General
Obligation Bond in the range of $20 million to $30 million.
Revenues and Expense Summary
The city will collect $36,545,019 in General Fund revenue for the
upcoming fiscal year, up from $32,600,413 in fiscal year 2004.
Fiscal year 2005 revenue
projections continue to be flat. Even though we have enjoyed a 12 to 15 percent
increase in our taxable property tax base, all other revenues are projected to
increase only 3 to 5 percent during fiscal year 2005. Communication Service
Tax revenue has leveled off during fiscal year 2004. Previously, we experienced
a decline in revenue based on the increase usage of residential and commercial
cable modems and DSL services. In addition, building structure permits are
projected to be $35,000, down from $150,000 during fiscal year 2004. This is a
direct result of the lack of available land for new construction.
This
will be the first year that we implement a Utility Water Service Tax. Based on
current water usage, this will generate approximately $1,000,000 in General Fund
Revenue. In an effort to grow our revenue base, staff will continue to seek new
funding sources by applying for federal, state, and local grants.
Taxes and fees
I am proposing a $.50 cent increase from $5.82 to $6.32 per
$1,000 in assessed valuation in the property tax rate for fiscal year 2005. As
a result, the new rate and property appreciation will generate $ 1,050,497 in
additional revenue.
Based on an equity rate study performed by Government Services
Group, Inc., which analyzed the cost of providing fire service, I am proposing
an increase to the fire rescue rates for commercial, industrial and residential
services. More specifically, the proposed fire rescue assessment fee will
increase from $98 to $142 per residential household. In total, the increased
Fire fees will generate $1,325,000 in additional revenue. This will fully fund
our fire rescue service.
User rates and charges
I am proposing to increase the monthly stormwater fee from $6 to
$8. This will produce $650,000 in additional revenue. The proposed increase is
based on an independent consultant study performed in fiscal year 2000. Based
on that study, the recommendation was to increase our monthly rate to $8 so that
we would have sufficient funds to support future infrastructure improvements and
debt service payments. This additional revenue is needed to pay for upcoming
principal and interest payments relating to our outstanding State Revolving
Loans and 2004 Stormwater Capital Project Bond.
Additionally, I am proposing to increase water and sewer rates
from $6.65 to $10.00. This will produce an additional $1,000,000 in revenue.
The additional revenue will fund much needed infrastructure improvements, such
as lift station rehabilitations and the required Turnpike crossing project.
Also, delinquent fee for past due utility payments will increase from 2 percent
of the total outstanding balance to 4 percent of the total outstanding balance.
The new rate will generate an additional $27,000 revenue.
Capital Projects Summary
Fiscal year 2005 budget includes a total of $17,024,333 in
capital improvement projects and expenditures. Of the total, $10,132,833 is in
the Capital Project Fund (305) and $6,891,500 in the Enterprise Funds (Fund 401
and 450). Projects in Fund 450 will be funded with current revenues. However,
projects in Fund 305 and 401 are not currently funded and will require the city
to issue debt to complete the recommended projects.
As previously discussed at commission workshops and retreats, our
policy has been to issue bonds in $5 million increments to fund current year
projects. Based on our current revenue streams, we only have the ability to
continue to fund our capital projects in this manner for three to four more
years. Hence, I am proposing that we continue to work to have a referendum
proposal for a General Obligation Bond in the range of $15 - $30 million
prepared for the November 2, 2004, General Election. With interest rates at a
50-year low, now is an excellent time to continue investing in our city by
seeking the approval of our residents for a General Obligation bond. This will
not only fund our current capital projects, but also give us the ability to
complete projects that are currently included in years four and five of our Five
Year Capital Improvement Plan to be completed in a timely manner.
A complete list of all capital projects is included in the
Capital Improvement Section of the budget document.
Debt
Management Summary
We currently have approximately
$35 million in revenue bonds and $8.1 million in State Revolving Fund Loans
outstanding. During fiscal year 2005 our total debt service equals $3.8
million, up from $1.225 million in fiscal year 2004. The sharp increase
represents principal payments that are required on our outstanding issues. The
increased payments are a result of the debt repayment structure. Upon the
issuance of our existing debt, the city pays interest only in the early years of
the repayment period with the understanding that future years would require
higher yearly payments. This methodology allows a larger portion of current
funds to be utilized at the beginning of the construction cycle while deferring
principal payments until the completion of the project. However, going forward
we will seek to refinance existing debt to ensure level payments over the entire
repayment period of the bond.
Summary
The city is well positioned to deal with this period of slow
revenue growth and increased expenses. We have adequate reserves to address any
unexpected revenue shortfalls or extraordinary expenditures. We will continue
to work diligently to ensure sound fiscal management of taxpayer’s dollars.
As stated in my fiscal year 2004 budget message, our goal is to
become the beacon of revitalization and economic growth in central Broward
County. As we continue to move forward with the renaissance of our city, we
must continue to work diligently to ensure sound fiscal management of our
taxpayer’s dollars. Being that we are at a financial and policy crossroads we
must continue to get the maximum return on all of our capital investments, both
human and fiscal.
In conclusion, I would like to thank our staff for their
contributions to the development of this proposed fiscal year 2005 budget for
your review. Through information gathered at our pre-budget workshops and from
the Commission, department directors and their staff had the tremendous task of
developing estimates and documentation necessary to support the proposed budget
requests. Assistant City Manager Desorae Giles-Smith, Finance Director Kennie
Hobbs, Jr., and Accountant II Herbert Gumbs assisted me in reviewing the
departmental budget requests and formulating the final version of the proposed
fiscal year 2005 budget. Lastly, I applaud the Finance Department staff for
compiling and producing the final version of the budget for your review and
consideration.
July 1,
2006
To the
Honorable Mayor, Members of the City Commission, and Citizens of the City of
Lauderhill, Florida
In accordance with Article VI, Section 6.06 (e) and Article IX,
Section 9.01 of the Charter of the City of Lauderhill, I am pleased to submit a
balanced City Manager’s Proposed Budget for Fiscal Year 2007. This Proposed
Budget includes recommended revenues and expenditures for the period covering
October 1, 2006 through September 30, 2007, and is submitted for your review and
consideration.
The goal of this message is to provide information on past and
current trends that contribute to the implementation of all major programs and
services provided by the City. Furthermore, the goal of the budget is to
outline an operating plan, which provides for sound fiscal management through
the allocation of limited resources; as we strive to achieve the City’s
mission. This document will review all of the City’s major programs and
services and the funding sources necessary to provide them.
Budget Highlights
Over the past year, the City and
many of its residents have experienced the challenges presented by Hurricane
Wilma. Our City Hall incurred substantial damage and had to be evacuated. The
City will be operating for an extended period of time at the Corporate Park in
Inverrary.
Plans to construct a new City Hall at the corner of Oakland Park Boulevard and
Rock Island Road are currently underway, and more details will be forthcoming as
we continue into Fiscal Year 2007. Despite these challenges, the City of
Lauderhill has proven itself to be a vibrant and resilient community, of which I
am proud to be a part of.
As we progress with the renaissance of Lauderhill, the City has
made an ongoing commitment to improve the quality of life of its residents. As
an example of that dedication, the City has partnered with private developers,
the Broward County Commission, and the Department of Transportation, to invest
more than $100 million in neighborhood beautification and infrastructure
projects along the State Road 7 corridor. In addition, the County is moving
forward with the development of the Regional Park and Arts and Cultural Center.
The former will feature the Carishoca Market Place, which includes more than
400,000 square feet of both retail and office space, while the latter will host
art galleries and various educational and enrichment events.
As mandated by the Citizens, the City commenced phase one of its
Great Neighborhood Bond community improvement program in Fiscal Year 2006.
Projects such as the construction of privacy walls on Inverrary Boulevard,
various park renovations and community center enhancements commenced. Roadway
improvements and intersection enhancements on North West 56th Avenue
and North State Road 7 will be ongoing. In addition, during Fiscal Year 2007
the following projects are scheduled to commence construction: meeting room in
Jackie Gleason Park, construction of a community center at West Wind Park and in
Windermere, park improvements at West Ken Lark and St. George Parks, in addition
to various other capital projects that are detailed in the Capital Improvement
Section of this budget document.
The City continues to demonstrate it’s commitment to the
redevelopment of the Lauderhill by providing $648,612 in Tax Increment Financing
(TIF), to the Central Lauderhill and East Community Redevelopment Agency’s (CRA),
during Fiscal Year 2007. As a result, the CRA, in partnership with the City of
Lauderhill, is moving forward with the targeted acquisition of properties in
need of rehabilitation and redevelopment. These developments will help
contribute to reduced calls for service increased property values, and
ultimately, additional ad valorem tax revenue.
The FY 2007 budget includes funding for 12 firefighters, 4 police
officers and 5 part-time commission aides, which represent positions that were
approved during the 6-month budget but were only partially funded. The City of
Lauderhill has recently concluded a (3) three-part annexation of the areas of
West Ken Lark, St. George and Broward Estates. Over the past two years we have
added a total of 14 police officers, 12 firefighters, 2 code officers, 4
maintenance workers, and several part-time recreation leaders.
Budget Overview
For Fiscal Year 2007, the Proposed Operating and Capital Budget
totals $94.3 million for all funds. Of that amount, approximately $47.4 million
is for General Fund activities, $17.0 million for capital improvements, and $4.0
million for debt service. Special revenue funds, which include the Community
Development Block Grant (CDBG), State Housing Initiative Program (SHIP), HOME
grant and the CRA, total $2.3 million. Lastly, our Utility and Stormwater
programs total $23.5 million. As always, limited resources and increased
demands make it essential for the City to fund only the programs that provide
the most benefit to its residents.
An example of the continuing revitalization of our neighborhoods
is the 25.4 percent increase in property values. Total assessed property values
increased from $2.1 billion in 2006 to $2.7 billion in 2007. This increase in
assessed property value is primarily due to escalating residential home values
and also new commercial development. Included in the appreciation of property
values is $101 million, or 4 percent of taxable value, that is attributed to the
annexation of Broward Estates.
On the whole, operating costs
continue to rise due to built in increases relating to insurance, salary, and
pension benefits. Over the past 5 years, the City has seen double digit
increases in insurance costs. For Fiscal Year 2007, liability insurance will
increase $342,163, or 26.9 percent. The cost of health insurance coverage will
decrease by 5 percent in the upcoming year.
Salary and benefit costs account for approximately 70 percent of
the City’s total General Fund budget. The City’s required average pension
contribution ranges from 18 percent in the General Employees Retirement Plan (GERS)
to 33 percent in the Firefighter Retirement System (FRS). These salary and
benefit increases are primarily the result of collective bargaining
agreements.
As aforementioned, with the completion of the City’s annexation,
I am proposing the hiring of (12) twelve additional firefighters and (4) police
officers. This will bring our total complement of certified police officers up
to (115), and our total complement of firefighters to (103). The City continues
to place a high priority on public safety, and is committed to delivering the
lowest possible emergency response time, and excellent police coverage in all
areas of the City. The additional fire and police presence will ensure that
these areas have the same exceptional customer service as do existing ones.
Capital Improvements
During Fiscal Year 2007 the City will continue its investment in
capital and infrastructure improvements in the amount of $17 million. The
capital improvement fund (Fund 305) is dedicated to the management of capital
project expenditures such as equipment, renovations and vehicle purchases.
Staff carefully analyzes the costs associated with each item, compared to the
benefits and useful life of the purchase over time. The effective monitoring of
construction costs generally results in saving opportunities on both current and
future projects.
Debt
Management
The City is required to make $5.9 million in principal and
interest payments for its outstanding debt. This represents an increase of $2.1
million over Fiscal Year 2006. The specifics relating to the increased payments
are outlined in the debt management section of this message.
Revenue and Expenditure Summary
In the General Fund we have projected revenue growth of nearly
13.3 percent. As a result, total General Fund revenues have increased from
$41.9 million in Fiscal Year 2006 to $47.4 million in Fiscal Year 2007. The
increase, in part, is due to a strong real estate market. Our projected
property tax increased by $2.6 million. This
rise is primarily due to growth in increased property taxes as a result of
increased valuations, as well as new commercial property development.
Property Taxes and Fees
I am proposing that the ad valorem tax rate remains at $6.0200
mills per $1,000 of taxable value. However, to continue to service the debt of
our $35 million Great Neighborhoods Bond, we are recommending imposing a debt
service millage not to exceed $0.6310 mills per $1,000 of taxable value. Funds
collected from the debt service levy will be used solely to repay the principle
and interest on the Great Neighborhoods Bonds. The Fire Rescue fee will remain
at $143 per residential household, no change from the prior year.
Conversely, I am proposing to restructure the Water and Sewer Fee
Schedule to ensure sufficient revenues to meet our bond obligations. In
addition, there are proposed amendments to transport fees and recreation program
fees included in this budget. These proposed changes are fully detailed in the
Budget Summary section of this document.
Property Values
The total taxable property for the City of Lauderhill is
approximately $2.7 billion. This figure has risen 25.0 percent since last
fiscal year, or roughly $6.0 million dollars.
Utility Taxes
Fiscal Year 2006 was our first full year collecting the Water
Utility Tax. This 10 percent tax on water and sewer availability and
consumption generated $1.1 million in revenue for the General Fund. In Fiscal
Year 2007, the water utility tax is projected to bring in $1.3 million in
revenue. Based on increased fuel costs passed down by regional suppliers,
related utility taxes are expected to increase by approximately $400,000.
Licensing and Permitting Fees
Permitting and connection fees will reflect a $1 million
increase, due to the construction of 325 luxury town-homes scheduled to be
completed during Fiscal Year 2007. In addition, supplementary occupational
licenses revenue will be generated as a result of the new commercial business in
the annexed areas.
Public Safety
This year public safety operational costs will increase a total
of $3.3 million. This is due to the addition of twelve (12) new firefighters
and (4) four new police officers, as well as increased salaries and benefits due
to contract obligations.
City
Commission
At the direction of the Commission, funding for community
programs and special events are included in this budget. Total funding for the
requested programs is roughly $460,430.
The City’s stated goal is to maintain an unrestricted fund
balance of at-least 10 percent of budgeted expenditures. As you know from prior
budget messages and various community workshops, the City’s long-range financial
plan included a planned spend-down of fund balance to fund needed City-wide
capital improvements with current resources versus issuing bonds. We have
accomplished our mission. With the successful issuance of the City’s first
General Obligation Bond in the amount of $35 million, we will be able to address
many of our long term Capital needs over the next four years.
Current year-end unrestricted fund balance is projected to be
$4.4 million or 9.3 percent of the General Fund budgeted expenditures as of
September 30, 2006; while Fiscal Year ending September 30, 2007 projected fund
balance is estimated to be $4.8 million or 10.3 percent of the General Fund
budgeted expenditures.
Capital Projects Summary
Traditionally, the City has taken a proactive approach in
addressing the infrastructure and public asset needs of the community. Fiscal
Year 2007 budget includes over $21.0 million in capital projects. Of that
total, $17.0 million is in the Capital Projects Fund (305), with $11.1 million
directly funded by the Great Neighborhood Bond Fund (GO Bond). The Enterprise
Funds (Fund 401 and 450) account for $4.3 million in capital improvements.
Projects in the Capital Projects Fund that are not GO bond projects, will be
funded with current revenues through a transfer from the General Fund, and from
proceeds from the sale of City assets. Enterprise Fund projects will be funded
primarily from prior debt proceeds ($3.9 million); however, $400 thousand of
retained earnings will be used to fund the balance of the capital projects.
Major projects included in phase two of the Great Neighborhoods
Bond improvement program are as follows:
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Various park improvements (West Ken Lark Park, St. George
Park, Wolk Park, Jackie Gleason Park, Westwind Park, City Hall Park and
Ilene Lieberman Park
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Roadway improvements on 55th Avenue from Sunrise
Boulevard north to Oakland Park Boulevard, 47th avenue, 19th
street, 21st street and 26th street
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Continued installation of Privacy walls in Northwest
Lauderhill and the Homes of Inverrary
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Improvements to Wolk Park, City Hall Park, Jackie Gleason
Park, and Westwind Park
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Various Land acquisitions
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Citywide street resurfacing and paving
Major projects in the Enterprise
Funds include the completion Florida Turnpike Crossing Water and Sewer Line
Relocation project, and mandated upgrades to our water utility plant and tanks.
Debt Management Summary
We currently have approximately
$50.2 million in revenue bonds, $34 million in General Obligation bonds, and $7
million in State Revolving Fund Loans outstanding. As a result, the City’s
required debt service payments for Fiscal Year 2007 is roughly $5.9 million; of
that, $2.25 million needed to make debt service payments on the General
Obligation Bonds will be generated through tax levies and interest earning. To
meet our legal obligation to the bondholders; funds for the General Obligation
Bonds are kept separately, and are dedicated to funding only capital projects
that are a part of the five-year capital improvement program.
Summary
The FY 2007
budget continues to focus on our goals and priorities that have been
developed through our continual planning processes. These priorities include:
public safety, transportation initiatives, revitalization of our neighborhoods
and major thoroughfares, and the expanded economic development of our
businesses; which ultimately results in an improved quality of life for our
residents and businesses. These shared priorities are within our reach, but
only if we continue to work together to envision and build a successful future.
In conclusion, I would like to thank our staff for their
contributions to the development of this Proposed Fiscal Year 2007 Budget for
your review. Through information gathered at our pre-budget workshops and from
the Commission, department directors and their staff have had the tremendous
task of developing estimates and documentation necessary to support the proposed
budget requests. Assistant City Manager Desorae Giles-Smith, Finance Director
Kennie Hobbs, Jr., and Budget Analyst Herbert Gumbs assisted me in reviewing the
departmental budget requests and formulating the final version of the Proposed
Fiscal Year 2007 Budget. Lastly, I commend the Finance Department staff for
compiling and producing the final version of the budget for your review and
consideration.
Very truly yours,
Charles “Chuck” Faranda
City Manager
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