1. New Port Richey The State of the City March 3, 2011 John Schneiger, City Manager
2. Topics to be covered Ten year history of the CRA and General Fund - interesting facts Changing fiscal environment New Port Richey’s economic and fiscal challenges Recent City accomplishments My recommendations for meeting the challenges of changing times and new situations 2
3. Financial Work Sessions Council Work Sessions Feb. 1: Financial Planning Status Feb. 8: Five Year Financial Projections Feb. 15: Recreation and Aquatic Center Feb. 17: Managers’ Finance and Budget Meeting Mar. 3: “State of the City” presented to the public Mar. 10: CRA Strategic Redevelopment Plan 3
4. What’s different The “New Norm” The economy will not automatically rebound Revenue sources are realigning, possibly permanently State and County are in deep financial trouble Short-term fixes won’t bridge the gap anymore Structural change is coming 4
5. Economic challenges No “quick fix.” City needs to continue efforts to cut City Government costs. Improve City Budgeting process and administration in order to truly become a blueprint for next year. Take a hard look during the next few years at Fund structure and flow. Make necessary systematic adjustments. Work collaboratively with Public Safety unions to devise sustainable pension plans. Overall, ensure all Funds’ fiscal sustainability, especially the General Fund and the Community Redevelopment Agency. 5
6. New Port Richey Population: 16,454 (2009) 2011 Budget: $34,785,480 6
7. Recent accomplishments Millage level not increased in 2011 Debris collection funded again in 2011 Street Improvement Program US 19 utility improvements Pine Hill Road/stormwater improvements Downtown Railroad Square II Project completed US 19 Intersection Safety Program (red light cameras) 7
8. Recent accomplishments Successfully negotiated Interlocal Agreement with County to widen Main Street (split utility cost and better design) Upgraded Disaster Preparedness Plan Agreement struck with Main Street Landings More water sold to Tampa Bay Water Outstanding operations at Water Treatment and Distribution Operations - less than 6% leakage Finance Department Operational Audit close to completion 8
9. Recent accomplishments:City Manager Initiated all-employee meetings to increase City employee cohesiveness and communication. Initiated monthly Coffee with the City Manager meetings. Hired new Chief of Police, Development Services Director, and assisted City Council in hiring an Interim City Attorney. Took ownership and initiative to resolve redevelopment programs such as the Main Street Landings and the Hacienda Hotel. 9
10. Recent accomplishments:Police Deployed the Department’s second K-9 unit. Deployed an investigator to Pasco Sheriff’s Office Vice/Narcotics to work full-time on prescription pill crimes. Participated in a National Domestic Violence Round-Up with other County agencies; achieved national second place for the second consecutive year, with 67 arrests and 382 attempts at service. Considering a possible City animal control project. Participated in enforcement projects with the Pasco County Sheriff’s Office, resulting in over 60 criminal charges. 10
11. Recent accomplishments:Human Resources Aggressively limited City liability from a risk management prospective via working with City attorneys. Initiated a Safety Task Force to help reduce liability claims and effect a 3% reduction in liability premiums. Modernized City policies, procedures, and systems that impact liability, as well as City operations and staff efficiency and effectiveness; all of which ultimately impact City costs. 11
12. Recent accomplishments:Public Library Nominated for Best Small Library in America. Set up computer for hard of hearing to make phone calls using donated Sorenson Videophone equipment. Set up a Rosetta Stone language computer for patrons to use to learn a foreign language. Created a Web application for issuance of library cards to eliminate paper applications. Worked on “green” project: public areas painted, restrooms upgraded; lights to be retrofit in March and flooring replaced by June. 12
13. Recent accomplishments:Development Department A streamlined Development Department was created at the end of last year to meet Budget challenges. Processed 72 applications through the Development Review Committee. Issued 1,238 permits with a conservative estimated $10,484,129 total value. 13
14. Recent accomplishments:Parks and Recreation Opened Frances Avenue Park playground. Wi-Fi installed at the Recreation and Aquatic Center. Funding provided by Katelyn Foundation to enroll 61 children in swim lessons. 230 volunteers collected 1.71 tons of debris during River Clean-Up. National “Playful City USA” for the 2nd year in a row. Youth Advisory Board awarded “Volunteer Group of the Year” by the Florida Recreation and Park Association. 14
15. Recent accomplishments:City Clerk’s Office Successful qualification of one Mayoral candidate. Second year in a row for an unopposed candidate. Saved the City approximately $6,000 in election costs. City Code Book is up to date. One new ordinance is at Municipal Code. E-mailed as Word document for rapid update. 15
16. Recent accomplishments:Fire Department Scored “outstanding” on their Emergency Medical Services Audit from the State Department of Health. Leading efforts related to the Disaster Preparedness Plan. 16
17. Increasing City cash flow Florida League of Cities Training Last six months’ accomplishments: Code Enforcement collections Red light cameras Cell towers Recreation concession stand Charging criminals with the cost of police services Comprehensive Fee Study 17
18. Strategic Action Plan for the Community Redevelopment Agency Evaluation and recommendation of 6 selected properties Evaluate and recommend CRA-wide strategies Downtown US 19 Neighborhoods A vision for the future Community Meeting in February Plan on adoption in March or April 18
20. General Fund issues General Fund’s revenue is capped, as a result of CRA, which comprises most of the City. City’s assessed value: over $1 billion. Statewide average per capita taxable value is $83,000. New Port Richey is less than one half, at $41,000. Statewide average for per capita property tax is levied at $418. City of New Port Richey is $332. Port Richey is $413 per capita, and Zephyrhills is $298. 20
23. City Manager recommendations City staff: continue to do everything possible to cut costs and develop cost containment strategies. City Council: prioritize General Fund services based on financial projections that demonstrate the need for the General Fund to support CRA debt in the near future. Improve City Budget to give it a stronger focus on programs (Goals and Objectives). Improve Budget process, format, and management. Further develop the Five Year Capital Improvement Program to facilitate an increase in outside funding procurement. 23
24. City Manager recommendations Be very frugal with “Penny for Pasco” funds, which may sunset in 2014 (CDBG). Adopt a formal policy regarding City charges and fees, leading to a systematic review of current charges and fees. “Stay the course” regarding 2012 Budget emphasis. Accept the necessity of changing how things have been done. City to increase partnerships with citizens, employees, organizations, and the business community. The City and Community should support local businesses. 24
25. City Manager recommendations Future City Council Work Sessions to consider: The cost to the City of special events Review of the Finance Operational Study Street light assessment increase Electronic utility reader investment Alternatives to the current debris collection Animal Control partnership 25
26. 26 What is a Strategic Plan? Just like a road map, a Strategic Plan shows us the steps we need to take to get to our destination.
27. Strategic Plan benefits Enables the City Council to provide better leadership Improves the partnership between Council and staff Encourages “thinking ahead” Provides a chance for us to evaluate our services Helps us to better utilize City resources 27
28. Summary The fiscal sustainability of the City, through cost containment and economic recovery, is not just an issue for elected officials, the City Manager, and the City staff, but for the community as a whole. 28
29. Economic challenges No “quick fix.” City needs to continue efforts to cut City Government costs. Improve City Budgeting process and administration in order to truly become a blueprint for next year. Take a hard look during the next few years at Fund structure and flow. Make necessary systematic adjustments. Work collaboratively with Public Safety unions to devise sustainable pension plans. Overall, ensure all Funds’ fiscal sustainability, especially the General Fund and the Community Redevelopment Agency. 29
Editor's Notes
As we look at our City over this past year and into the future we must pause to reflect:Do we want a possible future, a plausible future or a preferable future? For the first two we simply just have to be reactive and hope we will survive through these harder times and things will go better in the future. For a preferable future we need to create a plan that incorporates partnerships with our citizens, our council, and our employees. Today I want to talk to you of the challenges ahead and the opportunities that are before us in making that preferable future. Our initial goal is simple: To make the strongest possible recovery from the most severe national recession our country has faced in the post-war era. As we all know, a strong and speedy recovery is not inevitable for any city in Florida. It won’t happen on its own. But with the right strategy, there is no doubt in my mind that we can bring NPR to economic sustainability and lift our City to new heights. That is the great challenge facing us, and together we can meet that challenge and prevail. Today, I want to tell you where we are and where our journey needs to take us. My first 9 months as your City Manager have been both intense and difficult. My primary effort has been and will continue to be cost containment. The City of New Port Richey is experiencing a high level of financial distress. Continuing to hope for a magic bullet will, in my opinion, lead to very undesirable results.I believe that over the next few years the City Council, City Manager, and staff will need to look at structural problems within the City Budget and make systematic adjustments. By this I mean that there is no quick fix. It will take time to turn the City’s finances around.
It was obvious to me when I came to my position in the middle of the 2011 Budget process that we were in fiscal distress. At that time, I recommended that we cut $650,000 from the Community Redevelopment Agency. This included 8.3 full time positionspositions and elimination of the residential and commercial grant programs.I also shared with the City council that we needed to begin work on the 2012 Budget as soon as possible, as this was, in my mind, the number one priority. That work began this past January and resulted in the above financial and Budget work sessions.We are attempting to get ahead of the curve and then stay on the determined course, and also focus on sustainability.
The crisis that is facing all cities is rethinking models of service delivery and administration whose time has passed. They may have been viable 10, 20, or 50 years ago when developed. Need to be revisited in an innovative way. The answer is not necessarily to do without, the answer is to do differently.
Analysis over the last month demonstrates that the City needs to continue its efforts to cut City Government costs and raise revenues wherever possible.
New Port Richey is a great community, but is experiencing a lot of what other Florida cities are experiencing: changing crime patterns, drug problems, high unemployment, changing demographics, significant number of foreclosures, increased service demands, federal mandates, decreasing revenues, and impacts of Amendment #1.Along with this, the overall City Budget has decreased by 28% in the last 4 years, from $48 million to $34 million. During this same period, the CRA Budget decreased by 54%.The city has eight departments. This year, had decrease of 8.3 full-time positions.Initiated a mandatory analysis to justify the filling of all existing vacancies, and we are freezing some that we don’t consider core services.This is the third year in a row with no salary increases.We will continue to right-size the City’s staffing levels to reflect Budget concerns, again, based on analysis.The majority of City staff recognize that fiscal sustainability is a major challenge. They, along with myself, continue to look for ways to cut costs. There is a continuing increase in employees who understand the need to make sacrifices in these difficult times.We have dedicated employees in all departments. Outstanding people! We are working very hard to communicate with them about what’s happening, and involving them in many efforts to improve the city. Excellent examples of teamwork; Disaster Preparedness Plan.
Successfully negotiated Interlocal Agreement with County to widen Main Street (split utility cost and better design)Congress to Rowan.
Accomplishments:City Council and staff worked together to find ways to generate additional revenues for the City in order to lessen the need to cut expenditures.Working on a number of other concepts that will be brought before the City Council for consideration.Attempting to be creative and innovative in finding ways to make more money for the City. Red light cameras: promote intersection safety on US 19
Another accomplishment:Believe strongly in “planning the work, and then working the plan.” That’s what doing here and in other areas.Very important public work session from 6:00 - 8:00pm on March 10 (next Thursday) in Council Chambers.AECOM, hired by the City, will present a 70% complete draft of plan. Looking for lots of community input.6 opportunity sites: First Baptist Church (Post Office) Hacienda South River Road Church Main Street Landings Two hospitals Meeting with Community Hospital to discuss their properties in New Port Richey. They are important to the community sustainability.
What we are going to look at first is the history of the CRA. You’re all familiar with what has happened with the CRA in the last 10 years, but not necessarily the ways in which the General Fund has been impacted. In 2001 CRA expanded to almost entire city, which capped increases in property valuations or new construction property tax revenues into GF, while need for GF services increased.City leveraged CRA revenues to pay debt service on Recreation & Aquatic Center ($14 million) and redevelopment property purchases ($7 million). These projects not appear to produce revenue to repay CRA. During period CRA paying for growing amount of GF services. Based on economy CRA hit very hard. Short term outlook not good. Approval of Note 2010 changed a lot of things. Instead of paying interest only in past, including only $77K in 2010, now looking almost $700K year. Will result in reversal as see with GF subsidizing CRA. Future will be guided 2011 CRA Plan.Economic development, including redevelopment, need to be an important part of what we do. As well as leveraging limited available capital funds with outside funding resources. The question is how to pay for this type work.General Fund issues
The first thing to recognize is that the three primary funds of the City are Utility, General Fund, and Community Redevelopment Area, and that there are major transfers between these funds each year. What we are looking at tonight are the CRA and General Fund, between which is a strong relationship. Last year the CRA provided the General Fund with over $2 million. After we look at each fund separately, we’ll combine the two, and anticipate what we can expect.As you know, we have had three years of double-digit decreases in the CRA based on the shrinking of the Tax Increment. What we have done here is look at both the CRA and the General Fund, and projected what we believe may happen in the future under different scenarios.Last 3 years 54% decrease. Significant decrease this year. Total debt $22 million.
First thing you can see is the dramatic drop over the last 3 years. Then you can see what happens under the two different scenarios.Demonstrate major transition (lack of sustainability)Note CNotes A and BUnder each scenario CRA becomes separate fund, with no transfer of funds out in the future.
Lastly, lots of good things going on at City. At the same time change and transitions are never easy.
