08/23/2016 - PacketPort Orchard
Council Finance Committee
August 23, 2016
7:3o am Council Conference Room
City Hall
1) Finance Report
a. Sales Tax Revenue Report
b. Treasurers Report — Funds, accounts
c. Salary Survey
Treasurer Martin
2) Transportation Funding update
a. Berger Abam contract approval and budget amendment Mark Dorsey
Other Items to come before the Committee
Schedule Next Meeting Date
Role of the Finance Committee
The finance committee provides oversight of city budgeting, financial planning, and financial reporting. The committee recommends long-range
financial goals along with funding strategies for the operating and capital budgets. Human resource issues requiring policy direction are brought
before the committee. The committee serves as the advisory forum for transportation and street maintenance funding, and funding relating to the
transportation benefit district.
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General Ledger
Cash and Investment
Totals
User: rnichols
Printed: 08122/ 16 14:16:39
Period 07-07
Fiscal Year 2016
City of Port Orchard
216 Prospect Street
Pat Orchard, WA 98366r
(360)876-5139'
www.c1tyofportorchard.us
Account Number Description Beg Bal Period Amt End Bal
001
Current Expense
2,703,013.27
-28,324.07
2,674,689.20
002
City Street Fund
1,127,261.79
-198,988.81
928,272.98
003
Stabilization Fund
668,990.98
130.88
669,121.86
General Funds
4,499a66.04
-227,182.00
4,272,084.04
103
Criminal Justice
491,556.79
-1,552.56
490,004.23
104
Special Investigative Unit
61,042.46
-6.50
61,035.96
107
Community Events
98,530.83
8,945.08
107,475.91
108
Paths & Trails
5,012.09
97.97
5,110.06
109
Real Estate Excise Tax
1,828,508.12
-365,428.52
1,463,079.60
111
Impact MitigationFee
1,155,695.26
78,955.10
1,234,650.36
Special Revenue Funds
3,640,345.55
-278,989.43
3,361,356.12
206
2003 Limited Tax GO Ref Bond
0.W
0.00
0.00
Debt Service Funds
0.00
0.00
0.00
302
Capital Construction
140,386.28
-75,377.48
65,008.80
303
Cum Res Equip Replacement
390,994.96
177.39
391,172.35
304
Street Capital Projects
610,607.41
-64,221.88
546,385.53
Capital Projects Funds
1,141,988.65
-139,421.97
1,002,566.68
401
Water -Sewer Utilities
1,926,662.80
137,901.21
2,064,564.01
402
Water -Sewer Equip Replace
314,395.16
154.02
314,549.18
403
Water -Sewer Cumulative Reserve
4,691,205.25
14,672.32
4,705,877.57
Water Sewer Utility
6,932,263.21
152,727.55
7,084,990.76
421
Storm Drainage Utility
965,164.47
-55,853.22
909,311.25
422
Storm Drainage Equipment Repla
151,225.06
50.31
151,275.37
423
Storm Drainage Capital Facil
297,569.10
123.67
297,692.77
Storm Drainage Funds
1,413,958.63
-55,679.24
1,358,279.39
631
Trust and Agency
22,167.74
-13,018.63
9,149.11
632
Wastewater Treatment Facil Fee
2,374,641.52
4,287.40
2,378,928.92
Trust & Agency Funds
2,396,809.26
-8,731.23
2,388,078.03
Grand Total
20,024,631.34
-557,276.32
19,467,355.02
GL - Cash and Investment Totals (08/22/2016 - 2:16 PM) Page 1
General Ledger
Fund Balance Reserves
User: michols
Printed: 08/18/16 09:35:00
Period 07 - 07
Fiscal Year 2016
Account Number
Description
End Bal
109-0-508-30-01
Restricted End Fund Bal-REET 1
$
577,849.40
109-0-508-30-02
Restricted End Fund Bal-REET 2
$
885,230.20
109
Real Estate Excise Tax
$ 1,463,079.60
111-0-508-00-00
111-0-508-30-00
End Restr Fund Bal-MW Trans
$
612,765.51
111-0.508-31-00
End Restr Fund Bal - Parks
$
228,014.16
111-0-508-32-00
End Restr Fund Bal - McWdParks
$
127,540.27
111-0-508-33-00
End Restr Fund Bal - Bayside
$
131,992.76
111-0-508-34-00
End Restr Fund Bal-Transportat
$
134,337.66
III
Impact Mitigation Fee
$
1,234,650.36
Department of Revenue
Leasehold excise tax audit 12.85%
PASSED
McCormick Note
C0 FoJ
P
441,250.00 $ 700.00
(168,250.00) $ 225.00
273,000.00
168,250.00
(56,250.00)
112,000.00
Answer 410
550 385,000.00
250 56,250.00
800 441,250.00
o�
J
160''''
112,000.00
250
56,250.00
410
$ 168,250.00
No.10 project. The loan is funded from the Drinking Water State Revolving Fund (DWSRF)
which is a federal infrastructure loan program designed to assist Municipal and other drinking
water systems with low -interest construction loan funding, The City's interest rate is 1.5% and
the loan term is 24 years. Total debt outstanding as of December 31, 2015 is as follows:
Original
Issuance Maturity Interest
Debt
Name Amount Purpose
Date Date Rate
Outstanding
Bus. -Type Activities
Drinking Water State
Revolving Fund
10/1/203
(DWSKR) $ - Capital
4/8/2014 8 1.50%
$ 671,596
Bus. -Type Total
671,596
Total Due to other Governments
$ 671,596
2015
2016
2017
2018
2019
2020-2024
2025-2029
2030-2034
2035-2038
C. GOvERNMENT NOTE
Business -Type Activities
Total
Principal Interest Requirements
33,580
504
34,084
167,900
2,519
170,419
167,900
2,519
170,419
167,900
2,519
170,419
134,316
2,015
136,331
$ 671,596
$10,074 $
681,670
Government note in business activity outstanding at year-end is as follows:
Original Issuance Maturity Interest Debt
Name Amount Purpose Date Date Rate Outstanding
Bus. -Type
Activities
McCormick Note
Bus. -Type Total
Total Note
$441,250 Capital 11/23/1998 N/A
0.00% $ 168,250
168,250
$ 168,250
51
The promissory note that was entered into for the purchase of the McCormick Water Company is
being repaid with new McCormick water connection fees as the revenue source. There is $700
paid on each of the first 550 connections and $225 paid on the 551 n through the 800`s
connection. Payments are made no less frequent than quarterly. This type of note does not have
a repayment schedule.
D. REFUNDED DEBT
In prior years, the City has defeased various bond issues by creating separate irrevocable trust
funds. New debt has been issued and the proceeds have been used to purchase US Government
securities that were placed in the trust funds. The investments and fixed earnings from the
investments are sufficient to fully service the defeased debt until the debt is called or matures.
For financial reporting purposes, the debt has been removed as a liability from the governmental
activities column of the statement of net position. At December 31, 2015, $12,000 of bonds
outstanding are considered defeased.
NOTE 11. LEASES
Operating Leases
The City is obligated under certain leases accounted for as operating leases. These represent
lease of copiers, a postage machine, lease for a police substation and an aquatic lands lease. The
lease for the police substation expires May, 2016. The City signed an aquatic lands lease June 4,
2012, with Washington State Department of Natural Resources. The first four year period the
lease payment amount is $21,280.43 (with an inflation adjustment annually.) In 2015,
$22,676.43 was paid to DNR for this lease. At the end of each four year period, the state will re-
value the annual rent.
The following is a schedule by years of future minimum rental payments required under
operating leases that have initial or remaining non -cancelable lease terms in excess of one year
as of December 31, 2015:
Year Ending December 31 Total
2016 42,002.43
2017 39,752.43
2018 30,159.43
Total minimum payments required $ 111,914.29
Total rent expense for the year ended December 31, 2015 was $45,151.93.
52
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Allan Martin
From: Allan Martin
Sent: Wednesday, August 17, 2016 3:48 PM
To: Rob Putaansuu
Cc: Rebecca Nichols; Heidi Draper
Subject: Berger Abam's work in the amount of $300,000
'..
Mark Dorsey has said that he expects the city will fund Berger Abam's work in the amount of $300,000 for
preparing advertising ready bid documents for the Tremont Street Widening Project.
The original intent was to pay Berger Abam from available grant proceeds obtained/released through a Puget
Sound Regional Council process. That intention seems less likely resulting in the city paying for such services
using its own financial resources.
Tuesday night a contract with Berger Abam goes before council for approval. Council members may first
recommend using Real Estate Excise Tax fund balance to pay Berger Abam. For several reasons funding should
properly come from current expense — general fund balance.
Current Expense:
• recurring source
• greater flexibility
• straight forward transparency
• Current Expense and City Street are general fund
• Street Capital Project receives funding from the general fund.
• Using general fund balance lowers the amount available for street in the upcoming biennium — rather
than impacting other projects
• Straight forward reimbursement of expenditures from bond proceeds should the city pursue
reimbursable bonds
REET
• considered one-time revenue
• revenue source has a restricted purpose
• a permitted use for park improvements
• greater detailed tracking requirements
Our work on the 2017 — 2018 preliminary budget has considered REET proceeds as available for McCormick
Woods Park construction. That amount has yet to be determined.
My recommendation is a budget amendment using current expense fund balance, in effect lowering 2017 -2018
Street Capital Projects beginning fund balance. Street Capital Projects will serve as the expenditure fund for the
Tremont Project. It would be incumbent on the city to consider the $300,000 a cost of the project paid from
Street Capital funding.
Furthermore, Resolution No. 030-13 authorizes the Treasurer to execute a Declaration of Intent to Reimburse
Expenditures from Proceeds of Bonds. The Treasurer has signed such an intent providing the option that at a
future date the city may reimburse the current expense the $300,000 Berger Abam payment using bond
proceeds issued for the project.
I do not recommend using REET balance that currently is estimated to end the year near $1 million. Simply put,
funding from the current expense fund allows the city the most financial flexibility.
Allan
0
PSRC Project Tracking Exceptions Request
Please complete the follow form to request an exception to PSRC's project tracking policies. We strongly
recommend parameters for "exceptions" are reviewed prior to completing the form. The adopted project
tracking policies can be accessed at: http�Hwww,psrc.org/fundinci/tracking/
to
(check appropriate box(s))
Overview of Requ
Please describe the
specific request being
made.
Transfer
extensions for
Click here to enter text.
Regional Parameters
Will the phase(s) involved in the exception request re
fully funded? Please also complete and the attached
spreadsheet.
Can the applicable phase can
❑ Yes
❑ No
phases
❑ Yes
❑ No
months of PSRC
If yes, please provide a detailed schedule, with all necessary milestones and the approval dates or
anticipated completion dates (please provide an attachment, if necessary).
Click here to enter text.
Please describe the need for the exception, including the circumstances that have changed since the
most recent grant application and PSRC funding award. i.e. there is a risk of losing other (non-PSRC)
funding if not granted or is there a significant impact on the timing of completion and coordination with
other projects. As a reminder, per the adopted policies, the transfer of funds to reduce the local match
commitment provided in the competitive project selection process is not considered a compelling need.
Click here to enter text.