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Home My WebLink About2016 Mayor's Annual Address to CouncilSouth Bend Common CouncilFebruary 13, 2017Mayor’s Annual Address Excellence | Accountability | Innovation | Inclusion | Empowerment At a GlanceThe administration supported over $260 million in private investment since the beginning of 2016 that will generate 651 jobs.Over 7,000 jobs have been added since 2012, reducing the unemployment rate to below 5% from over 10% in 2012. Labor participation rate is at 66%, above national, state, and metro area averages and has been rising since 2009. The City’s population is estimated to have increased again in 2016, continuing the reversal of over 25 years of decline.Roughly 700 new residential units have been announced, half of which have or are coming online downtown this year.Median income $34,656; Per capita personal income $19,064; 27.8% poverty rateExcellence | Accountability | Innovation | Inclusion | Empowerment 2016 Key InitiativesNearing completion of Smart StreetsIssued an Executive Order establishing an official city-wide diversity and inclusion initiativeto promote equal opportunity in the city’s workforce and operations and develop a strategic plan for the cityGroup Violence Intervention helped to reduce group member involved shootings in 2016; homicides were also down slightly from 17 to 14, despite increases nationallyImplemented Priority Based Budgeting to maximize effectiveness and efficiency of taxpayer dollar expendituresPlacemaking•Reorganized the Parks Department into a new Department of Venues, Parks and Arts to ensure better services to residents and better efficiencies throughout the department and the City•Received Regional Cities Grant that will allow for improvements to the City including the Riverfront Parks and Trails initiative Excellence | Accountability | Innovation | Inclusion | Empowerment 311 Calls 1/1/2016 to 9/1/2016 Excellence | Accountability | Innovation | Inclusion | Empowerment NeighborhoodsNeighborhood FeaturesExtremelyDissatisfiedDissatisfied Neutral SatisfiedExtremelySatisfiedCondition of streets12.0 16.7 25.7 31.8 13.9Condition of sidewalks22.0 24.6 25.3 18.6 9.5Condition of street lighting15.9 22.0 27.6 22.0 12.5Condition of parks16.4 16.6 26.2 25.0 15.8Housing12.9 17.7 30.0 24.8 14.6Safety18.0 19.5 27.7 23.8 10.9Quality of businesses17.5 20.2 30.1 22.9 9.3Variety of businesses24.2 23.3 26.2 19.2 7.2Satisfaction with Features by District Excellence | Accountability | Innovation | Inclusion | Empowerment TIF Expenditure Overview 2015-2016•Total River West Investments: $43,697,533•Total River East (inclusive of Residential Area) Investments: $9,868,914•Total South Side Development Area Investments: $5,019,353•Investment Breakdown: •55% Public Infrastructure- neighborhood/community benefit (capital improvements, roads, corridor improvements, streetscape, sidewalks, debt service on public facilities/projects, studies, plans)•45% Economic Development - project specific incentives (capital expenditures, infrastructure, utilities, building improvements, environmental remediation)Excellence | Accountability | Innovation | Inclusion | Empowerment Excellence | Accountability | Innovation | Inclusion | Empowerment 14,546,18814,418,67514,640,61617,519,33413,760,37314,856,07917,047,65717,013,077$0$2,000,000$4,000,000$6,000,000$8,000,000$10,000,000$12,000,000$14,000,000$16,000,000$18,000,000$20,000,0002014 2015 2016 2017(P)RevenueExpenseWater Works O&M FundWater FundingIn addition to O&M shortfall, $88 million of capital investment needs identified over the next 5 yearsExcellence | Accountability | Innovation | Inclusion | Empowerment $7.95$2.21$3.17ALL UTILITIES SURVEYED SOUTH BEND (CURRENT RATE)SOUTH BEND (43% INCREASE)2016 IFA STUDYWATER CUSTOMER RETAIL UNIT COST($/1,000GALLONS)Indiana Finance Authority – Evaluation of Indiana’s Water Utilities 520 Utilities Surveyed60% of Indiana AverageWater RateExcellence | Accountability | Innovation | Inclusion | EmpowermentProposed new rates will only fund 18% of the $88 million of capital investment needs MVH Revenue & Expense Budget$0$2,000,000$4,000,000$6,000,000$8,000,000$10,000,000$12,000,0002014 2015 2016 2017RevenueExpenseRoad Funding •Applied 112,719 gallons of anti-icing liquid treating 2,254 miles of snow routes during the 2015-2016 winter season•1,154 blocks of alleys graded•11 blocks of alleys reconstructed•3,822.5 miles of streets swept•11.12 lane miles of streets repaved•154 loads of storm debris hauled from June storms$3.4 million projected shortfall in road funding in 2020 without state action Excellence | Accountability | Innovation | Inclusion | Empowerment Accomplishments•62% of our fleet is converted to CNG•Implemented new Yard Waste program•Reduced Trash Misses by 39%•Increased efficiency of extra pick‐ups by 37%•Delivered 6,968 Yard Waste containers$4,800,000$5,000,000$5,200,000$5,400,000$5,600,000$5,800,000$6,000,0002013 2014 2015 2016 2017 (P)RevenueExpenseSolid WasteExcellence | Accountability | Innovation | Inclusion | Empowerment Key projects in 2016 included:•Primary Clarifier Rehabilitation & Equipment upgrades•Digester 2 Upgrade•Digester Gas Cleaning•Secondary Treatment Improvements•Grit & Screening ImprovementsPhase 1 of the CSO Long Term Control Plan (LTCP) cost roughly $148 million to complete. Phase 2 of the LTCP will cost $713 million as drafted in consent decree with EPA.Successful renegotiation of Phase 2 agreement with EPA will likely save ratepayers hundreds of millions of dollars with similar environmental outcomesWastewaterExcellence | Accountability | Innovation | Inclusion | EmpowermentPrimary Clarifier 4 —During ConstructionClarifier 7 —New mechanism and bridgeNew Grit Cyclone & Grit Washer Assessed ValuationExcellence | Accountability | Innovation | Inclusion | Empowerment Land Value DisparitiesExcellence | Accountability | Innovation | Inclusion | Empowerment Value of Density, DowntownExcellence | Accountability | Innovation | Inclusion | Empowerment Taxable LandExcellence | Accountability | Innovation | Inclusion | Empowerment S & P's General Obligation Ratings Indiana Second Class Cities As of January 28, 2016Obligor Rating1Fishers AA+2South Bend AA2Carmel AA2Noblesville AA3Bloomington AA-3Elkhart AA-3Evansville AA-3Fort Wayne AA-3Jeffersonville AA-3Lafayette AA-3Merrillville AA-4Anderson A+4Columbus A+4Mishawaka A+4New Albany A+4Portage A+4Richmond A+5Hammond BBB+5Terre Haute BBB+Second Class City refers to Cities with population in excess of 35,000 residents and a City Council of 9 members.Bond ratings are important to the City as the high rating allows the City to issue bonds at the lowest possible rate, therefore, saving valuable tax dollars.Note: No public ratings of debt for Evansville, Gary, Greenwood, Kokomo or Muncie.Excellence | Accountability | Innovation | Inclusion | Empowerment Projected Property Tax Levies Due to State Circuit Breaker Tax CreditsGeneral Fund$2.54 million estimated property tax reduction in general fund alone$30,000$32,000$34,000$36,000$38,000$40,000$42,000$44,000$46,000$48,000Thousands2009 Actual2010 Actual2011 Actual2012 Actual2013 Actual2014 Actual2015 Actual2016 Actual2017 Estimated2018 Estimated2019 Estimated2020 EstimatedNet Levy (in thousands) $46,551 $43,441 $42,066 $42,160 $38,369 $38,715 $38,619 $39,362 $39,756 $40,153 $40,082 $37,543 Excellence | Accountability | Innovation | Inclusion | Empowerment $70,000$75,000$80,000$85,000$90,000$95,000$100,0002012Actual2013Actual2014Actual2015Actual2016Actual2017Budget2018Estimate2019Estimate2020EstimateThousandsRevenue & Expenditures – General, COIT, EDIT and Public Safety LOIT FundsRevenueExpenditures~$10 million projected deficit in 2020 under BAUExcellence | Accountability | Innovation | Inclusion | Empowerment 1. Piloted the addition of six (6) new firefighters to reduce overtime costs within the department. 2. Reduced burden on general and income tax funds by shifting approximately $1.6 million in debt service payments and other qualifying expenditures from general and income tax funds to TIF funds. 3. With enterprise funds paying their fair share of administration and IT allocations, the general and income tax funds saw relief of over $1.5M. 4. Reduced the overall workforce in the Department of Administration & Finance by two (2) positions due to retirement and overall business requirements. 5. Overall IT expenses were decreased by approximately $300,000 through efficiencies and reduction in need for outside professional services. 6. Launched the new Priority Based Budgeting model for budget preparation and review. By the end of the exercise in 2016, we will have the cost and revenue associated with all of the programs we offer as the City of South Bend and prioritize them according to our goals. 7. Formalized Business Analytics and Innovation to find efficiencies and overall savings throughout City departments. 8. Centralized the Maintenance Divisions within the Department of Venues, Parks, and Arts to find overall efficiencies and cost savings through strategic purchasing efforts and shared labor efforts. 9. Continued progress on reducing claims and increasing collections across city departments with help from the Department of Law. 10. Adjusted parking fees to reduce the overall structural deficit in the Parking Garage Fund.Measures in 2017 Budget to Address Fiscal CurbExcellence | Accountability | Innovation | Inclusion | Empowerment 1. Continuing to work with the County to ensure property taxes accurately reflect market conditions and everyone is paying their fair share. 2. The administration will evaluate each vacant position and refill based upon operational needs (e.g. a 2.5% reduction of full‐time equivalents in the general and LOIT funds would save about $1.5 million from 18 positions.) 3. Working towards a more strategic purchasing plan and coordinating purchasing efforts to ensure the City is considering long term sustainability when making decisions. 4. Engaging in multiple strategies to bend the health care cost curve by maintaining a Health & Wellness Clinic and revising the Wellness Program (e.g. slowing cost increases to 5% per year instead of 8% would save nearly $1 million.) 5. Working with the State to fund local roads adequately could relieve the $3.4 million projected shortfall in 2020.6. Collaborating with the PSAP management to contain the cost of the consolidated 911 center. 7. Exploring new partners and outside funding streams for various City projects (e.g. government and philanthropic). 8. Discussing ways to partner with the County and gain overall efficiencies in service delivery. 9. Continuing work through the Department of Sustainability to that will provide cost savings. 10. Working to find energy efficiencies and implement technological solutions to save on operation costs (e.g. 5% cut would yield about $1.5 million of savings.) 11. Considering new revenue options to offset fiscal curb and growing structural deficit.Options to Stay Ahead of Fiscal CurbExcellence | Accountability | Innovation | Inclusion | Empowerment 02004006008001,0001,200Full Time Employees ‐December 31, 20165552928923222276Excellence | Accountability | Innovation | Inclusion | Empowerment RevenuesGeneral Fund 63,585,275 62,367,954 55,106,216 53,719,608 56,474,525 Special Revenue Funds 55,684,376 59,232,045 55,527,526 58,056,013 67,801,179 Capital & Debt Service Funds 5,469,086 4,178,129 2,990,006 3,781,829 4,926,841 Enterprise Funds 115,975,757 80,206,643 81,994,452 94,852,365 94,282,102 Internal Service Funds 21,154,131 22,799,127 23,646,014 23,608,505 28,766,463 Trust Funds 13,207,579 10,913,212 11,250,794 11,427,281 10,888,596 Redevelopment Funds 30,244,194 33,035,709 31,199,681 35,495,272 30,106,095 Total Revenue 305,320,398 272,732,819 261,714,689 280,940,873 293,245,801 ExpendituresGeneral Fund 63,399,284 62,326,332 54,686,374 51,988,184 52,482,273 Special Revenue Funds 52,199,459 55,048,410 58,525,465 64,812,979 61,963,073 Capital & Debt Service Funds 7,391,170 5,100,018 7,580,704 5,511,960 4,472,162 Enterprise Funds 91,466,805 95,162,743 90,470,162 95,696,921 99,861,764 Internal Service Funds 21,636,374 24,428,685 24,682,209 24,334,214 26,190,507 Trust Funds 12,215,209 11,927,126 12,156,033 11,547,460 11,557,934 Redevelopment Funds 34,578,806 25,664,749 20,683,664 39,613,972 30,825,761 Total Expenditures 282,887,107 279,658,063 268,784,611 293,505,690 287,353,474 Net Sources of/ (Uses of) Fund Balance 22,433,291 (6,925,244) (7,069,922) (12,564,817) 5,892,327 2016Actual2014ActualCity of South BendConsolidated Revenue and Expenditure Summary2013Actual2012Actual2015ActualExcellence | Accountability | Innovation | Inclusion | Empowerment $- $5,000 $10,000 $15,000 $20,000 $25,000 $30,0002012 2013 2014 2015 2016 2017ThousandsLocal Income Tax Revenue - 2010 to 2017CEDITCOITPS LOITYear CEDIT COIT PS LOIT Total2012 $ 9,068,785 $ 8,610,742 $ 6,605,601 $ 24,285,128 2013 8,177,352 7,846,939 5,892,386 21,916,677 2014 8,796,821 8,645,811 6,380,029 23,822,661 2015 9,181,206 8,859,912 6,466,190 24,507,308 2016 9,594,602 9,454,023 6,791,160 25,839,785 2017 10,600,122 10,459,265 7,467,618 28,527,005 Excellence | Accountability | Innovation | Inclusion | Empowerment 2017 Key Initiatives•Sustaining commitment toinclusive economic growth (small business and workforce development, homelessness working group, anchor institution strategy, wireless)•Making our community safe for everyone (GVI, 21stcentury policing, recruiting, training)•Optimizing County-City partnerships and partnering with the South Bend Community School Corporation and other key stakeholders to enhance education opportunities •Pursuing a range of internal governance improvements that will increase overall efficiency and effectiveness through reform of purchasing, central services, and central payment processing, as well as integrating Performance Management andPriority Based Budgeting programs•Moving forward with implementation of Diversity and Inclusion plan•Further engaging the neighborhoods•Placemaking (Riverfront Parks and Trails, infrastructure investments)Excellence | Accountability | Innovation | Inclusion | Empowerment Additional Information Available Online at:https://www.southbendin.gov/government/division/finance(“View publicly‐available city budgets and finance records” section)