March 26 - City of Melbourne, Florida

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CITY OF MELBOURNE, FLORIDA MINUTES – REGULAR MEETING BEFORE CITY COUNCIL MARCH 26, 2013 • The City of Melbourne once again received the Certificate of Excellence in the reporting of our financial statement, which is very positive. The independent auditors’ report is a clean, unqualified report, which is the highest, most positive report that can be issued. • Citywide total assets have gone up by about $6 million, from $375 million to $381 million. Liabilities went up, but a significant portion of that is the liability required to be recorded for retirement health benefits for employees. The total of assets, less liabilities, moved in a positive direction on a citywide basis. • Revenue over last year in the General Fund went down and total expenses went up. The City spent about $346,000 from fund balance, which was a decision made by Council. Council intended to use some of the reserves during leaner times. Total change in net assets for the Water and Sewer Fund was a positive $2.7 million – up about $900,000 over the prior year. • The money the City contributes to retirement plans is up about $1.2 million. The net appreciation in retirement plans was negative last year; this year, it’s positive by a swing of over $18 million. There are more assets this year than in the past, which relates to funding and investment on return. The fire pension is underfunded by about $21 million, the police pension is underfunded by about $30 million, and the general pension is overfunded. Although unfunded liability is paid through future budget processes, it is something Council needs to be aware of. • The City budgeted General Fund revenue at $65.7 million and actually received about $63.3 million. The largest item in that amount is property taxes. To meet the needs of government, the City budgeted to spend about $67.3 million and actually spent about $64 million. The largest item in the under budget amount is public safety. • The undesignated fund balance in the General Fund is about 22% of annual expenditures. Authoritative sources indicate that 20 – 25% is a good range. • Revenue for the Golf Course Fund is down, which relates to the economy; expenses are up slightly. The loss in that fund is about $115,000; however, about $99,000 of that is depreciation. If sales do not improve, money may have to be loaned from another fund to meet the day to day commitments until play increases. • With regard to federal and state grants – SHIP, HOME, etc. – there are no material findings. One finding was noted where a receivable was booked relating to the state revolving loan, but that loan had not been completed by September 30. Financial Services backed that out so it’s not shown in the statements. • The final portion of the report relates to the management letter and the City’s compliance with certain sections of the Florida Statutes. Council Member Greg Jones referenced the category titled “other – unclassified” in the schedule of revenues, expenditures and changes in fund balance. He asked what is rolled Page 4 of 26
CITY OF MELBOURNE, FLORIDA MINUTES – REGULAR MEETING BEFORE CITY COUNCIL MARCH 26, 2013 into this item. Mr. Hoyman replied that he will send an email to all Council Members describing that line. Mr. Jones pointed out the spike in workers’ compensation claims, which is significant over previous years. Director of Finance Michele Ennis explained that we experienced the perfect storm this year with old claims, current claims, and a significant increase in the cost of public safety. She advised that addressing workers’ compensation issues is always an ongoing process between departments and the Risk Management Division. She confirmed that this year’s trend is somewhat normalizing. Mr. McNees thanked Michele Ennis, her staff, and the Financial Services Department for this great, clean bill of financial health the City received. He stated that the financial report reflects their good work. Mr. McNees also recognized his predecessor, Jack Schluckebier, for his financial stewardship that placed the City in this position. Mr. Hoyman closed by commending City staff for doing a tremendous job. He noted that not many cities in the County have this kind of financial statement. Moved by Goode/Tasker to (consider Items 9 through 12) before hearing Item 8. Motion carried unanimously. (Items 9 through 12 were heard before Item 8.) UNFINISHED BUSINESS 8. ORDINANCE NO. 2013-09: (Second Reading/Public Hearing) Finding of Consistency (FOC- 2012-08). Amending Chapter 27 of the Code of Ordinances entitled Storm Water Management by creating a new Article IV, City of Melbourne Fertilizer Ordinance. (First Reading - 3/12/13) City Attorney Paul Gougelman read Ordinance No. 2013-09 by title. Council Member Harry Goode asked if the Legislature plans to readdress the fertilizer legislation. Mr. Gougelman said that some jurisdictions are considering adopting a fertilizer ordinance that is more stringent than the state model ordinance. Some legislators are concerned about that and one legislator in particular is considering a proposal to tighten the law, which would probably result in ebbing of home rule. City Engineer Jenni Lamb stated that staff is concerned about the Indian River Lagoon and recognizes that the sea grass has greatly deteriorated, which impacts the overall health of the lagoon. In addition to the proposed fertilizer ordinance, the City has taken or is taking a variety of steps to reduce pollutants that enter the lagoon, including preparation of a stormwater quality master plan; stormwater quality capital improvement projects; street- Page 5 of 26
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March 26 - City of Melbourne, Florida

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