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2018 Preliminary City of Moorhead Budget
The City continues to experience significant growth and economic development and as a result, the revenue picture is improving; however, the costs to deliver current services are also growing. We continue to strive to support new or enhanced services in the upcoming years. There are very few opportunities for increased revenue in financing City government. The recommended budget continues to provide basic services, and maintains the quality standards our residents have come to expect. This balanced and strategic approach results in a spending plan that adapts to the changing needs of our community, without compromising our financial future.
The process: Mayor Williams, City Council members, and City Manager Volkers, along with all City department directors participated in a series of facilitated meetings over the past four months to establish the City’s 2018 budget priorities. Springsted, Inc., the City’s financial and bond consultant, served as the facilitator. Further, the council’s Advisory Budget Workgroup discussed and reviewed recommendations through a series of nine meetings beginning in March, 2017. Prior to this process and soon after she started work in January, City Manager Volkers thoroughly reviewed existing detailed department budgets and met individually with all department directors to discuss current spending levels. As a result of this thorough analysis, Volkers confirmed that the City is operating at maximum efficiency within current resources.
The result is a 2018 proposed budget that works within existing resources, but also includes modest additions to ensure service levels are maintained in our programs and activities. Also, the plan strives to maintain or replace existing assets as needed and address demands of new growth throughout the City. Lastly, the City’s vigorous economic development efforts continue to be funded in a manner that produces beneficial results. A key focus of the city’s economic development pursuits is to ensure that services and amenities are well balanced and targeted to maximize business opportunities throughout the community.
Features of the 2018 proposed budget:
Implementation of a workforce compensation plan:
- A recent classification and compensation analysis documents below-market employee compensation and recommends adjustments to address employee recruitment and retention difficulties.
- The analysis evaluated all positions in the City. Especially difficult to recruit and retain are positions that require licensure and extended training periods.
- The current turnover is costly and results in a less experienced workforce. As an example, the Police Department has lost 11 employees in the past year alone, and spent $3.25 million in training new employees during the past 10 years, only to have several employees leave for higher wages in surrounding communities. Other departments are also experiencing significant retraining costs.
- Health insurance premium rates for employees have increased significantly in 2018 due to recent incurred and projected claims. It is expected that the additional cost will be shared by employees and the City.
- Authorization of three additional staff positions:
- Park Technician:
- The number of parks has increased from 30 in 1997 to the current 46 parks in 2017.
- Grounds maintenance acreage has increased 122%, from 414 acres in 2007 (excluding the golf course acreage) to the current (2017) 919 acres after property buyouts for flood protection that have occurred since 2009.
- Bike trails and paths have increased from 11.5 miles in 1997 to 44.6 miles in 2017 (288% increase), and more trails will soon be constructed.
- Parks Maintenance staffing has remained the same (5 FTEs) during the past 20 years.
- The additional Park Technician will improve customer service and help keep pace with the increasing park system infrastructure.
- Forestry Truck Driver:
- Moorhead’s urban forest has increased by 5,400 trees in the past 10 years.
- The number of households have increased from 13,730 to 16,475 (20%) since 2007, resulting in increased branch pickup and wood waste volumes.
- Forestry staffing has remained the same (6 FTEs) during the 10-year time period.
- The additional forestry position will enable the City to reduce the boulevard tree trimming cycle from 10–12 years to 7–8 years and maintain quality and timely brush pick up service.
- Technical Office Specialist – Public Works:
- Improved Facility Management – The City of Moorhead does not have a Facility Management Division. Currently, all facility management and maintenance functions are coordinated by the Public Works Director.
- The new position will assist the Public Works Director to develop and implement a project execution strategy for facility maintenance as determined during the city-wide Facility Condition Assessment to include:
- Reviewing work items
- Formulating executable projects
- Developing RFPs for design and construction
- Assisting with overall project management.
- Efficient Service Request Coordination – New position will assess work management within Public Works and evaluate performance of over 3,000 annual service requests, evaluate GPS route data for optimization and manage the overall work management process.
- Effective Fleet Management – New position will assist the Public Works Director in Fleet Management. Currently, the Public Work Director manages over 600 vehicles and pieces of equipment and handles approximately $2M in annual purchases for fleet recapitalization. The specialist will develop vehicle/equipment specifications using the MN State Bid contract and other pre-existing contract methods such as the National Joint Powers Alliance contract, obtain quotes, coordinate with end users and generate purchase recommendations for Public Works Director approval.
- Park Technician:
- Investment in capital improvements:
- Highlights (Leveraging state and federal resources where possible):
- Retrofitting outdoor warning signals with battery backups – modify 5 in 2018 and remaining 4 in 2019 which will complete this project of ensuring all outdoor warning systems have battery backup.
- Leveraging Minnesota Legacy Fund grants and other outside funding to complete connected bikeways and pedestrian trails along the river corridor—north, south, and central (Memorial Park Bridge, MB Johnson, Blue Goose Trail, Homestead Trail, and reconstruction of the Downtown Trail:
- $4.1 million total project cost
- $2.7 million in grants
- $612,200 City cash match
- $404,500 City in-kind match (engineering services)
- Replacing two vehicles within the MATBUS fleet: One transit bus and one senior ride van replacement: 20% local share ($100,000) matches 80% state and federal funds.
- Conducting critical maintenance and repairs to a number of city facilities.
- Providing furniture for move of Police Department to new joint City/County Law Enforcement Center.
- Highlights (Leveraging state and federal resources where possible):
- Increasing support for street maintenance materials and ice control supplies
- Allocating $155,000 additional Municipal State Aid for pavement marking, signal maintenance, and city additional infrastructure maintenance
- Realigning various department expenses to more clearly define costs for functions
- Incorporating election costs totaling $50,000
The Proposed 2018 Operating & Capital Budget totals $82,284,861, an increase of $1,506,830 (1.86%) over 2017. The property tax impact on a median value home ($177,000), is an increase of approximately $35 annually. In 2018, the owner of this median value home would pay an estimated $2,213 in property taxes, an increase from $2,178 per year. This $35 annual increase equates to a 1.6% increase in the total property tax bill; however, County and School District budget changes and adjustments to taxable property values are not included in this calculation and will ultimately affect the impact on property owners’ property taxes.
A $1.00 monthly fee increase to cover Wastewater Treatment service needs is also projected. This fee increase will offset construction costs for two large lift station rehabilitation projects ($1.3M total) and fund design fees associated with lift station and wastewater treatment facility rehabilitation and improvements. The remainder of these large budget items will come from budget reserves.
Public Input Opportunities: Mayor Williams and the City Council set the preliminary budget and levy at the September 11, 2017 City Council meeting. This preliminary tax levy may not be increased but may be decreased at final approval. Presentation of the 2018 Operating and Capital Budget will be made at the December 11, 2017 City Council meeting where public input will also be received after which final approval of the budget is anticipated.
Further information is available at www.cityofmoorhead.com/budget