To: Honorable Mayor and Members of Town Council
From: David L. Corliss, Town Manager
Trish Muller, Finance Director
Title
Resolution Approving the 2018-2020 Balanced Financial Plan
Body
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Executive Summary
Future planning is an essential part of the annual budget development process. Accordingly, a three-year balanced financial plan has been prepared for Town Council’s review. The framework for this initiative ties back to the Town’s numerous Council-adopted long-range plans, which define levels of service and provide clear direction on priorities and projects.
The 2018-2020 Balanced Financial Plan demonstrates that the Town is in good financial condition and is able to accommodate the requests included in the three year planning period. All funds are balanced for all three years of the plan, meaning that funds available plus annual revenues exceed the total planned expenditures in all funds. All funds are also balanced from an operating perspective.
The plan does not include any tax increases. However, a system development fee increase is incorporated for water and wastewater funds for 2018.
Overarching goals of the 2018-2020 Balanced Financial Plan include 1) addressing top-priority, though not all, level-of-service issues identified by staff; and 2) incorporating additional major priorities and projects in a responsible and conservative manner.
Discussion
2018 Budget Priorities
The 2018 Budget priorities used as the basis for development of the 2018 - 2020 Balanced Financial Plan can be summarized as follows:
• Ensuring outstanding public safety
• Enhance our transportation
• Secure our water future
• Maintain strong parks and recreation
• Support economic development
• Manage Town finances conservatively
• Unique community character
Council has affirmed the above priorities and approach throughout the 2018 Budget process. These priorities are also supported in the 2017 community survey results as previously presented to Town Council.
Financial Overview
The 2018-2020 Balanced Financial Plan was developed using conservative and informed financial modeling and forecasting. Annual growth in sales tax revenue is included at 6.2% in 2018, 5.4% in 2019 and 5.2% in 2020. Residential growth is expected to continue to be strong over the three-year planning period and is budgeted at 700 single-family units and 634 multifamily units in 2018; 600 single-family units and 210 multifamily units in 2019; and 600 single-family units and zero multifamily units in 2020.
Based on these revenue assumptions, a General Fund operating surplus is reflected in each year from 2018-2020. This is with the inclusion of Town and employee medical and dental insurance premium increases for 2018-2020; accommodation of the increase to the police retirement contribution of 1.6%, and the addition of Thanksgiving and Christmas Eve holidays. Additionally, service levels were evaluated within each department as part of the annual financial planning process. Several service pressure points were identified, and provisions for some of the forecasted additional needs have been included, as detailed in the next section.
Financial Details
The 2018-2020 Balanced Financial Plan (Attachment A) shows that the estimated costs of addressing top-priority level-of-service needs and of implementing additional major priorities and projects can be accommodated in all operating funds using estimated revenues. Included within the plan are 28.75 additional positions, 17 of which are in public safety, needed to address top-priority level-of-service needs, along with increases in expenditures for equipment, technology and services. Following is a summary of the most significant items (generally, totaling $100,000 or more) in the plan for 2018, by fund and by department.
GENERAL FUND
Police Department:
• Addition of five personnel including a Special Operations Sergeant, Community Service Officer, a Public Information Officer, and two dispatchers totaling $555,427
• Increase to the retirement contribution for sworn police officers of 1.6% totaling $120,506
Fire Department:
• Twelve new personnel including Lieutenants, Engineers, Paramedics, and Firefighter/EMT positions needed to staff the new Crystal Valley Fire Station estimated at $1,563,745
• Operating costs for the new fire station totaling $390,248
• Transfer of $308,700 for the planned replacement of Self Contained Breathing Apparatus (SCBA) units in 2020 - annual transfers will occur through 2020 in order to accumulate necessary funds for replacing this equipment
Parks and Recreation:
• Partial funding of $207,000 in the General Fund related to recreation opportunities at Reuter Hess Reservoir - funding for this initiative is also included in the Parks & Recreation Capital Fund
• Extension of the East Plum Creek Trail for $2,000,000, of which $1,000,000 will be reimbursed as part of grant proceeds from Great Outdoors Colorado (GOCO)
Division of Innovation and Technology:
• Addition of a Network Infrastructure Engineer for $108,814, including salary and benefits
• IT Governance project funding of $200,000 to accommodate several projects that meet the criteria of benefiting public safety, having Townwide benefit, or being public facing
• Operating cost increase of $153,920 to accommodate increased hardware and software maintenance costs for town systems
Town Attorney:
• Addition of an Assistant Town Attorney for $145,223, including salary and benefits
TRANSPORTATION FUND
• Addition of a CIP Inspector position for $146,981, including salary and benefits
• Increase of $100,000 to accommodate changes to compensation for employees who perform snow removal
• Funding of $300,000 for a feasibility study related to the consideration of a Black Feather interchange
• Downtown mobility study costs of $120,000
• Annual pavement maintenance program costs totaling $6,982,060, plus street reconstruction projects of $3,660,768
• Meadows Parkway reconstruction for $2,467,000
• Traffic signal program costs of $500,000
CASTLE ROCK WATER FUNDS (Combined)
• Purchase of an additional jet truck for $425,000
• Water supply well projects totaling $3,025,000
• Water treatment plant upgrades and equipment for $350,000
• Water storage projects totaling $460,000
• Expenses of $460,000 for upgrades to the pumping and distribution system
• Rehabilitation and replacement of water lines for $953,000
• Canyons South Red Zone extension for $110,000
• Costs of $570,000 for continuation of the WISE project
• Chatfield reallocation project costs of $899,805
• Future pipeline and pump station expenses totaling $5,555,300
• Continuation of the Alternative Source of Supply project for $2,976,667
• Construction of the Plum Creek Diversion and well fields for $18,609,762
• Expansion of the Plum Creek Water Purification Facility totaling $17,683,174
• Stabilization of streams and minor drainage ways for $1,410,735
• Storm sewer improvements totaling $456,000 in the Young American subdivision
• Wastewater lift station upgrades for $242,000 and sewer line rehabilitation for $740,000
• Plum Creek Water Reclamation Authority expansion and projects totaling $19,696,205
CAPITAL FUNDS
Parks and Recreation Capital Fund:
• Partial funding of $207,000 in the General Fund related to recreation opportunities at Reuter Hess Reservior - funding for this initiative is also included in the General Fund
• Construction of a new neighborhood park for $2,000,000
Fire Capital Fund:
• Equipment for the new apparatus for the Crystal Valley Ranch fire station totaling $300,000
Police Capital Fund:
• Two new vehicles for $103,000 related to the new Special Operations Sergeant and PIO positions
Transportation Capital Fund:
• Expansion of the Service Center for $3,997,500
• Improvements at Highway 86 and Allen Way totaling $4,264,200
• Improvements at Highway 86 and Crowfoot Valley for $3,460,000
• Addition of a roundabout at Plum Creek and Wolfensberger for $1,119,813
• Design costs of $640,625 for widening of Plum Creek Parkway (East)
• Design of a roundabout at Plum Creek and Gilbert for $153,750
• Accumulation of funds for a future interchange at Crystal Valley Parkway for $500,000 and planning for eventual widening of North Meadows Drive for $250,000
GENERAL LONG-TERM PLANNING FUND (TECHNOLOGY AND CAPITAL REPLACEMENT)
• Replacement of the Town telephone system for $200,000
• Replacement of synthetic turf totaling $160,000
• Parking lot maintenance for $285,500
DEVELOPMENT SERVICES FUND
• Addition of one Building Inspector position for $131,134, including salary, benefits, and vehicle costs
COMMUNITY CENTER FUND
• Replacement of the boiler at Butterfield Pool for $160,000
• Funding to add a boarding system to the north field at the Miller Activity Complex totaling $125,000
CONCLUSION
The overarching goals of the 2018-2020 Balanced Financial Plan are to address top-priority level-of-service issues and to incorporate additional major priorities and projects in a responsible and conservative manner. The 2018-2020 Balanced Financial Plan demonstrates that the ongoing initiatives set forth within the 2018 Budget are sustainable and the one-time requests are able to be accommodated.
STAFF RECOMMENDATION
Staff recommends that Council approve the 2018-2020 Balanced Financial Plan as presented.
PROPOSED MOTION
“I move to approve a Resolution Approving the 2018-2020 Balanced Financial Plan.”
ATTACHMENTS
Attachment A: Resolution
Exhibit 1: 2018-2020 Balanced Financial Plan