FY 2011-12 Adopted Budget - City of Oviedo

Debt Service and Lease Financing Support
Debt service expenses are down by $30,000 due to the lower principal amount for the 2011 equipment lease, which
now excludes debt service for the jet-vacuum machine that was purchased in FY 10-11 from Stormwater Utility
reserves. The General Fund share of debt service costs is approximately $1,617,000 or 6.9% of the FY 11-12
proposed General Fund Budget. Approximately 90% of this obligation is associated with several refunding revenue
bonds originally issued in the 1990’s for parks and recreation and general facility improvements, as well as, two
bank notes ($7 million total) for the new Fire Station and Public Works Maintenance facility approved by voters in
November 2006. The $1.6 million debt service share is well within the standard set in City financial policy that
limits revenue bond debt to no more than 10% of General Fund operating revenues or approximately $2.32 million
for FY 11-12.
Fund Balance for Economic Uncertainties
An important indicator of the City’s financial position is the level of its undesignated fund balance relative to the
total General Fund expenditures. At September 30, 2010, the General Fund reserve was $3,769,456 or
approximately 15.9% of FY 10-11 General Fund budget. FY 10-11 year-end projections indicate that the
undesignated fund balance will decline to 15% as expenses are projected to exceed revenues by approximately
$285,000. To the extent that year-end expenses exceed revenues by more than this amount, the ending fund
balance will fall below 15%.
Changes in the City Workforce and Total Payroll
Excluding the staffing reduction associated with the proposed Police dispatching consolidation, the total number of
authorized full and regular part time positions for FY 11-12 is set at 266, which is essentially the same as in FY 10-
11. The size of the city’s workforce is the same as it was in FY 03-04, whereas the number of positions has
declined to 7.7 per 1,000 population compared to 9.8 in FY 07. Since FY 06-07, the city’s workforce has been
reduced by 70 positions or more than 20%. Contributing to this reduction is the contracting of Building
Services and Grounds/Right-of-Way Mowing that occurred last year. The seasonal workforce that is budgeted at 19
full time equivalent positions has also declined by 10 full time equivalents since FY 06-07.
The citywide payroll of $18 million for all operating funds combined is down by $228,000 or 1.25%. The
decline reflects the workforce and other personnel reductions described herein including the proposal to contract
with the Seminole County Sheriff for Police dispatch services at mid-year. The decrease is net of the 2% wage
increase for Police bargaining unit members and General Employees (scheduled at mid-year), higher City
contributions for the Police and Fire pensions and higher Fire Department overtime that has been contained by the
addition of three (3) full time Firefighter “overhires”.
Total Benefits (Payroll Matching Costs and Health Insurance)
Health Insurance: Health insurance premiums established by the City through its self-insurance plan for all
coverage types will decrease by 5% effective October 1, 2011. The cost of single (employee) coverage will
decline from $6,397 to $6,077. This premium decrease coupled with proposed workforce reductions and
changes based on the August open enrollment have lowered total FY 12 health insurance costs by $112,000
to $1,592,000 of which $1,434,000 is the cost for single coverage paid by the City on behalf of City
employees. The balance or $158,000 reflects the City’s 35% cost share for dependent health insurance costs
based on the current mix of dependent coverages elected by City employees.
City Pension Contributions: Total pension contributions budgeted by the City for FY 11-12 is set at
$1,361,000, an increase of $100,000 compared to FY 10-11. The increase is being driven by higher City
contributions to the Police and Fire pensions with the Police contribution increasing from 13.96% to 16.68% of
payroll and Fire increasing from 17.1% to 17.6% of payroll.
Worker’s Compensation: The City will benefit from lower Worker’s Compensation costs due to the City’s
continued low claims trend. Total workers’ compensation costs based on the FY 11-12 insurance renewal
through Public Risk Management is $335,631 compared to $354,533 for FY 10-11.
vii