Levelland City Council held a special meeting Monday night. The main portion of the meeting was spent looking at the city budget and discussing ways to cut costs.
Richard Ellis spoke during the public forum portion of the meeting. He noted that the city has some high capital items so he encourages saving for the high capital items. He said it is not common in governmental entities but he would suggest that money be put into a “rainy day” fund to cover high capital items as the city goes through the budget. He said “just spend $1 less than you make and it is a safe sustainable model.” Don’t spend more than you make and try to save a little for Capital expenses.
The council then took action on a contract with Parkhill, Smith and Cooper for the Texas Capital Fund Community Block Grant project. EDC Director, David Rushing noted that the contract agreed to matches the Texas Department of Agriculture budget. South Plains Association of Government has approved the contract. The contract was approved with little discussion.
The city council held a budget work session and discussed the special funds.
The city is projecting to end the current budget year with $328,926 which is up from $297,184 in October, 2018. There are no significant changes in expenditures for the Airport Fund. The City Airport is on schedule with the state for an AWOS or Advanced Warning System. This system will give the airport the capability to land larger aircraft at our airport. The system would make it possible for planes to land in denser fog than otherwise. It is approximately 10-12 week process to construct. TxDOT has to give final approval and their engineers will come out and design the project. It was also noted that new runway lights will also be installed. It was the early 90’s when they were last replaced. That will be a $1 million dollar project and TxDOT will pay 90% of that cost.
Interest & Redemption Fund
Maintained as part of debt service schedule. Significant cash flow will be freed up in 2021-2022 and additional will be paid off in 2024-2025. Councilwoman Breann Buxkemper noted the council needs to be forward thinking looking for improvements that are needed that the freed up cash flow could be used for.
Wastewater System Improvement Fund:
The fund was created approximately 15 years ago to have a way to build cash into to go toward Wastewater Treatment plant improvements or replacements. Currently the city is estimating ending the current budget year at $1.7 million dollars. One expenditure is being proposed in the 2019-2020 budget year. The city is needing to replace the pivots at Wastewater farm at an estimated cost of $275,000. It was also discussed that the city will be looking to start design of a new Wastewater Treatment Plant. That is a 10-15 million dollar project. It was also noted that it would be a wise move to possibly start a Water System Improvement fund in the near future. Councilman JoeBill Vardeman and Breann Buxkemper agreed that it is good fiscal sense to start saving for future improvements and future capital projects such as replacing the old clay lines. They are discussing a fee of $1.00 per month charge on each water bill which is approximately 5,400. That amount would generate $64,800 per year. It was also noted that if you are planning and possibly saving for capital expenditures will improve the city’s scores on grant applications for many projects. Councilwoman Breann Buxkemper said “it is a good idea.” The city administration will come back to the council with numbers in regards to creating the water system improvement fund.
Civic Improvement Fund:
Generates fund from Civic Center and Activity Building rental. There was a significant expenditure for gas line replacement as well as replacing all fixtures inside the building which are run by gas and were not up to code. The cost was an estimated $29,761. There is some discussions in making some improvements in the building. City council asked staff to get estimates on making improvements to the electrical in the building and adding air conditioning to the building.
Voluntary Park Donation Fund:
The city is looking at ending the current fiscal year with an estimated balance of $65,361. The city is proposing a portion of the fund to be used toward the grant the city is applying for to fund improvements at City Park. City Manager Erik Rejino said he felt the city had a good chance at receiving the grant based on the early scoring criteria he has reviewed.
Council also reviewed the Court Special Funding. Currently $3 per citation is directed by state statute to be used for building security for the building housing the court. Time Payment, $25 of every citation goes to various funds including $12 to the State. It was pointed out that the first $99.10 of every citation goes to the State of Texas.
Police Special Funds:
There are some funds generated through the state which pays for some training for officers. This funding helps pay for training in the smaller agencies that can’t budget for training. Approximately $2000 will be budgeted in 2019-2020 and the Police Department tries to use all of those first to pay for training classes.
State Seized Funds:
It is based on Seized funds. The department received some federally seized funds which helped pay for the new IPad technology in the officers cars. State seized funds will run lower than the Federally seized funds. There are some remaining seized items on the Federal side but funds have not been released by the Federal Government. Federal seized funds also helps pay for Undercover vehicles.
Community Development Corporation:
They are looking to end the current fiscal year with $787,832. They are planning to fund a new playground to create a “tot land” at the Country Club Park and have budgeted a $500,000 expenditure as a matching amount for the grant being applied for improvements to City Park or to fund a partial project at City Park. They are also looking to install a Windbreak at the Oxy Sports Complex.
Erik asked for council input on any items they felt could be cut from the budget. Erik noted City staff has looked at some areas to make cuts including a possible cut in Demolition of substandard structures. They are also looking closely at the Cost of Living Adjustment for staff. Currently they are looking at a 2%, however, Erik said it is critical that the city put money back this year. It is important the rainy day fund be built back. “There are tough decisions to be made by this council.” He noted that historically the city has come under budget. It was noted that one of the biggest funding sources the city has currently is sales tax which is scary because that is the most volatile revenue source the city has. Councilman Jim Myatt, asked what the largest expenditure was for the city, the City Manager said Personnel is the biggest expense and accounts for approximately 70% of the budget. Breann Buxkemper said she we would hate to see money for the housing demolition to be cut, but understands the city’s discussion in freeing up staff in the building inspection office to help in implementing a new sign ordinance which city committees are currently looking at. They are also looking at reducing money spent on training and travel. It was noted that some of it can be done through Webinars. Councilwoman Breann Buxkemper noted that if you need to decrease expenditures to save money or increase revenue which could impact property owners tax rates. Councilman Jim Myatt said “you cannot continue to spend more money than you have coming in.”
The city manager also touched on new requirements on reducing the Roll Back Rate from 8% to 2.5% before an election is required. There is an exception for smaller cities and after looking at the exception Levelland will not be affected by the new Roll Back Rate and the original 8% rate will remain in place. It means that the city cannot create more than 8% more revenue that the previous year. City Administration will continue to look at the budget and will release an updated budget following the release of Appraised Values on July 25th.