|
REGULAR MEETING SEPTEMBER 11, 2006
<br />insurance plan has been restructured to provide two tiers, with four different categories
<br />that will allow the employees to make a choice in the health insurance coverage that they
<br />choose. For some employees that can actually a decrease in the premium that they are
<br />paying. Among the more painful choices that the City has looked at is the one of no
<br />raises for non-bargaining employees, however, the City is proposing a $750.00
<br />supplemental pay for these employees. So that they are able to meet some increases in
<br />cost that they are experiences in their budgets as well.Finally, the proposal from the
<br />Park’s Department to close the Greenhouse and Conservatories as cost savings measure
<br />which will allow them to put those dollars into the Zoo and to sustain and improve Zoo
<br />Operations. So there are a number of challenges that the City faces, nevertheless, he
<br />believes that this is an excellent budget that they are submitting. Local Government must
<br />evolve; it can’t continue to do things the way that they have always done it. The City
<br />will always have challenges, but these challenges provide us opportunities to become
<br />more creative. Mayor Luecke stated that the team is up to those challenges and he
<br />believes that the budget that they are submitting, again, is a solid budget, that keeps the
<br />City fiscally sound and allows the City to meet their obligation and continue to provide
<br />the services, that the customers, the citizens and residents desire.
<br />th
<br />M. Catherine Fanello, City Controller, 14 Floor County-City Building, 227 W. Jefferson
<br />Boulevard, South Bend, Indiana, thanked all of the department heads and managers for
<br />their patience as a lot of discussion went on during the budget process. She thanked Tom
<br />Skarbek, Budget Director, who worked very hard on giving a revised way of looking at
<br />the budget this year. Ms. Fanello advised that the 2007 budget assumptions are that
<br />revenue in property taxes show a growth quotient of four (4) percent. Other taxes such as
<br />excise and State taxes (auto, commercial vehicle, etc.) advised by State to use 2006
<br />revised budget numbers. In other revenues such as increases and decreases based on
<br />current experience, past history, fee increases, and department input range from three (3)
<br />to twenty-three (23) percent. In non-bargaining, no base wage increases a $750.00
<br />supplemental pay will be in lieu of. Teamsters and Public Safety will be by contract.
<br />There will be no increases in supply line items, except where necessary, (i.e. gasoline.)
<br />Reduction in service line items, except where necessary (i.e. utilities, liability insurance.)
<br />No reduction in services to the residents of South Bend, and will maintain cash reserves
<br />at 20% in the General Fund. The 2007 Projected Fund Revenue is $197,555,472. The
<br />projected Operating Expenditures are $172,371,298. Ms. Fanello stated that the overall
<br />budget increased 6.79%. Personnel costs salaries and benefits net increase 5.18% (4.8
<br />million) net reduction of 25.5 budgeted positions, ($796,800) plus benefits for a total
<br />approximate budget reduction of ($1,076,874) Increases are largely due to public safety
<br />salaries and benefits ($2.1 million) and pension payments ($3.01 million) Teamsters and
<br />Non-bargaining approximately $590,000. In 2004, there were eleven (11) full time
<br />positions reductions; 2005, four (4) full time positions reductions; 2006, six (6) full time
<br />positions reductions; and in 2007 there will be twenty-five and one-half (25.5) for a total
<br />reduction of forty-six and one-half (46.5). The 2007 projected salaries and benefit
<br />expenditures are $97,220,885. The total 2007 projected pension contributions for all
<br />eligible employees is $5,702,111. The City contribution rates for Non-bargaining and
<br />Teamsters increased from 4.5% to 5.5%, as mandated by Public Employees Retirement
<br />Fund (PERF). The total 2007 contribution is $1,546,842 a change from 2006, of
<br />st
<br />$237,583. For Public Safety (Active), the City contributes 21% of a 1 Class
<br />policeman/firefighter salary as mandated by PERF. The total 2007 contribution is
<br />$4,155,268, a change from 2006, by $307,144. The 2007 projected expenditures of
<br />Police and Fire Pension benefit payments (retirees) is $14,334,692. An increase of
<br />$3,086,375 largely due to DROP, and drop payments will be made in the amount of
<br />$3,526,329. A transfer of $2.6 million for the General Fund to the Pension Funds was
<br />required to meet benefit payment obligations. Ms. Fanello advised that the health care
<br />costs budgeted medical payments will be $11.4 million. This is a claims increase of
<br />twelve 12% percent. The overall fund increase is 6.4% compared to last year’s increase
<br />of 14%. The City contributions based on active enrollment increased by only $520,459
<br />compared to $1.2 million in 2006. Even with plan restructuring, the City contributes an
<br />overall 85% of active employee health insurance premiums compared to the private
<br />sector contribution of 75%. In supplies an increase of 1.9% ($730,915) mainly for fuel
<br />costs, fuel was budgeted at $2.50/gallon with estimated increases totaling $536,701 over
<br />the 2006 budget. Other increases are in the Parks non-reverting and utility funds. An
<br />increase in services of 9.5% ($5.0m) was due to health and liability insurance cost
<br />6
<br />
<br />
|