2006 Performance Based Budget - Laserfiche WebLink

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increase in line with annual operating and capital budgets. Intergovernmental revenue of $7.3 million budgeted in 2006 mainly consists ofpension relief distnbutions received from the State of Indiana for city-funded police and firefighters' pension plans ($5.6 million) plus grants received from local, state or federal agencies ($ l .7 million). The State's pension relief funds are supported by a variety of revenue sources inchidmg cigarette taxes and lottery proceeds. These funds are distrbuted to cities within the state based upon complicated formulas that take into consideration the City's pay-as-you-go pension costs, fimding for statewide pension plans and several other variables. As reported for the past several years, the City's Police and Fire Pension Funds continue to experience fixndmg shortfalls as a result of the increasing number of retirees that are receiving pension benefits coupled with the base pay increases for the Police and Firefighters on which the pension payments are determined. Recent changes enacted by new state pension laws Dave lead a positive impact an the overall funding of these fiords. In 2006, the General Assembly enacted SEA 260 which guarantees that SO% of the pension payments the City makes will be reimbursed by the State in the current year. Thies law provides for this type of distribution through 2008. In 2001 is SEA 524 was adopted allowing for the distribution of the interest earned on the Public Deposit Insurance Fund. The total budgeted, for both pension fiords in 2006 is $170,000 for this new revenue source. The grants received from local, state or federal agencies are generally one year commitments and thus projecting this stream of revenue with any degree of certainty is difficult. As mentioned in other sections of this document, the City is committed to preserving its cash reserves and investing these fiords in order to ~aximi;~ investment returns. As a result, the Gity is budgeting 2006 revenues from vestment income of approximately $1.1 million. The City has assuamed an overall investment rate of 2.5% for 2006. Historically, the City has been very conservative in its interest income revenue projection. Through fiscally responsible cash management and sound investments, the City once again believes that its 2006 interest income budget will be met and exceeded, 200b EXPENDITURE BUDGET -SIGNIFICANT ISSUES AND ffiGHLIGHTS The 2006 Operating Budget is balanced and financially conservative. It contiunues the City's commitment to provide high quality, dependable services while directing available resources to service areas experiencing the greatest demand. The trend is to build upon what has aheady become a strong base. This budget addresses current and future commua~ity needs and balances service demands with conservative financial management. The City continually strives tv "live within its means" while providing strong, responsible leadership and offering efficient city services. Early on in the budgeting process, the Mayor set forth general guidelines that were communicated to department managers and fiscal staff before budgets were submitted to the City Controller. The Mayor emphasized his expectations of sound financial and operational decision making by his staff He reminded City Managers that each of the eight citywide goals must remain at the forefront while prepar~g this year's budget, The three key points that the Mayor stressed for the 2006 Operating Budget were as follows: no increases in staffunless new or expanded services were to be added or additional costs were necessary due to legislative mandates; there was zero growth in the category of supplies (unless new services were to be provided); and a targeted reduction of 5% in expenditures for the other services category (unless new services were to be provided). As a result, the City budgeted the costs anticipated to fiord all the services it currently provides as well as a few programs that have been modestly expanded. No services have been B-8