CITY OF ROCKY RIVER

JULY 20, 2009

The Committee-of-the-Whole was called to order by Mr. Moran, President of Council, at 8:00 p.m.

Council Members Present: Mr. Hunt, Mr. Mylen, Mr. Furry, Mrs. Arabian Whitman,

Mr. Moran

Absent: Mr. Shepherd, Mr. Long

Administration: Mr. Linden

Law Director: Mr. Bemer

The meeting was opened with the Pledge of Allegiance.

MAYOR'S REPORT:

In the Mayor's absence, Safety-Service Director Linden reported that paving and water line projects are going well. The Elmwood Project will begin August 7.

UNFINISHED BUSINESS:

Ordinance No. 48-09: Mr. Moran indicated that last week Councilman Long explained that this ordinance authorizes amendments to the Development Code. The ordinance has been referred to the Planning Commission for review and will be returned to Council following its recess.

• •Mr. Mylen asked if the proposed Development Code is available to residents. Mr. Moran indicated that residents may request an electronic copy or a hard copy at $.05 per page, but advance notice is required for preparation of a CD or hard copy.

MISCELLANEOUS BUSINESS: NONE

COMMITTEE REPORTS: FINANCE COMMITTEE UPDATE

Mr. Moran, Chairman of the Finance Committee, noted that the members of his committee, Mr. Furry, Mr. Long and Mr. Mylen are assisted by Mr. Shepherd, Mrs. Arabian Whitman and Mr. Hunt. Each member of Council is charged with oversight on the City's finances, so all participate in the budget process.

During last year's budget meetings, Mr. Moran had the overall responsibility for organizing and convening the finance meetings; Mr. Shepherd, for Police and Fire Divisions; Mr. Mylen, for the Courts; Mr. Hunt, for the Service Division; Mr. Furry, for the WWTP; Mrs. Arabian Whitman, for the Parks and Recreation Department, and Mr. Long for the Senior Center. Assistance and direction are provided by the Finance Director, Mr. Thomas, and Mayor Bobst.

Approximately three years ago, the budget review process underwent a change when preliminary considerations were begun in September with a goal of completion by year's end. Prior to that change, the process began in late in the year and was completed in March. During that time, money was being spent under a temporary appropriation.

This year has been challenging, with a tightened budget which was revisited by directors for cuts several times and a watchful eye being exercised by Council. Next year will be an even greater challenge with a fall in property and income taxes along with other challenges. The process is beginning with the directors now with a review of this year's figures and ideas for the coming year. The hope is to complete the process for the 2010 Budget by December 31, 2009.

Mr. Moran then reviewed Director Thomas' report for the budget year through June, 2009:

Revenue :

• •Income Tax: $4.395 million, less than 2008 at this time by $424,000 (about 8.8%)
• •Property Tax: 1/7 of the annual tangible personal property tax has been received; second half real property tax distribution from the County will begin in July. A drop will probably occur next year.
• •Estate Tax: received to date, $1.5 million with $143,000 on deposit with the Auditor compared to $1 million budgeted. This amount over the budget projection is consistent with that of the last two years.
• •Sanitary Sewer Collections: billed at $703,630 and $613,000 was collected. Almost 20% of the difference is one delinquent account.
• •Recreation Department: income is above budget projections, but membership renewals begin in the fall when income should increase.
• •Interest: projected at $534,000, but year-to-date is $120,000 which annualizes to $240,000, a considerable shortfall. This consists of short-term investments of funds received by the City; interest rates have fallen considerably with current rates often below 1%.

Expenditures:

• •Payroll: wages through June are $3.29 million (including the Court) compared to $3.258 million at this time in 2008. The City's payroll is $32,000 higher than last year, but considering the 2.5% increases granted, it is clear that overtime and part-time hours have been reduced.
• •Interest Payments: a June 1 payment of $411,267 was made for General Bond Retirement, Special Assessment Bond Retirement and RRMC Special Projects. This represents one-half of the annual interest due; the other half and the principal payment are due 12/1/09.
• •Sewer Rehabilitation and Capital Improvement: Contract payment for the Valleyview Water Main Rehabilitation Project. Another payment was made for the ice rink fire alarm system.

Mr. Moran summarized by saying that while the budget is holding to expectations with a slight windfall in estate taxes and the electric bill for Recreation Department, other funds have been slower to generate income than projected.

The same process will be used this year with each Council member assuming responsibility for a segment of the budget for review. He asked if any Council member has suggestions for improvement.

Discussion:

• •Mr. Furry commented that he favors having the budget in place before the beginning of the fiscal year. Mr. Moran added that there will be a surplus at the end of the year, though lower than at the beginning of the year. Next year's budget will be a challenge for all departments particularly since payroll is such a large part of the budget and income may fall again.



• •Mr. Hunt said that the budget process has become an important tool for Council members and sessions with the directors are extremely important. Members spend time going through budget projections with an assigned director so that they are knowledgeable about specific portions of the budget. This promotes accountability which is Council's obligation to its constituents, and being able to ask difficult budget questions is often very useful. He believes that the process works and is worth the effort.



• •Mrs. Arabian Whitman pointed out that with so many departments, it is helpful to have input from the knowledgeable directors who present information. A great deal of information is presented and, building upon that, Council members know what further questions to ask. There are no surprises during the year as directors present and explain expenditures before the budget is passed.



• •Mr. Mylen agreed with the foregoing comments and added that any information shared by the Administration as early as possible would be welcome. Mr. Moran noted that early involvement is valuable so that questions can be asked, and that Council is responsible for the final budget draft. He will set up the committee structure well before budget hearings.

NEW BUSINESS: NONE

COMMUNICATIONS AND ANNOUNCEMENTS:

Mr. Hunt was congratulated for being the coach of the winning team in the Little League World Series. The final games of this 57^th year of Rocky River Little League were last Wednesday with Mitchell's Ice Cream the champions of the minor league division and the Rocky River Brewing Company winning the major league division. Both series went to three games.

Mr. Moran commented that the crowds were huge and enthusiastic.

President Moran indicated that next week will be Council's last meeting before the August recess. A special meeting may be required in August for the Elmwood Sewer Project.

As there was no further business by members of Council, the meeting was adjourned at 8:33 p.m.

______________________________ ______________________________

James W. Moran Misao Kurokawa

President of Council Clerk of Council