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File #: RES 2019-091    Version: 1 Name:
Type: Resolution Status: Passed
File created: 9/10/2019 In control: Town Council
On agenda: 9/17/2019 Final action: 9/17/2019
Title: Resolution Approving the 2020-2024 Balanced Financial Plan
Attachments: 1. Attachment A: Resolution, 2. Exhibit 1: 2020-2024 Balanced Financial Plan, 3. Presentation

To:                     Honorable Mayor and Members of Town Council

 

From:                     David L. Corliss, Town Manager

                     Trish Muller, CPA, Finance Director

 

Title

Resolution Approving the 2020-2024 Balanced Financial Plan

Body

________________________________________________________________________________

 

Executive Summary

 

Future planning is an essential part of the annual budget development process.  In the past, a three-year balanced financial plan has been prepared along with the annual budget.  For 2020, planning has been increased to reflect five years. Increasing the planning period to five years provides a longer term perspective that demonstrates the sustainability of Town funds based on current planning.  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 while maintaining conservative financial management.

 

The 2020-2024 Balanced Financial Plan demonstrates that the Town is in good financial condition and although not all departmental budget requests were able to be accommodated, numerous requests to support level of service needs are included.  All funds are balanced for all five 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 Balanced Financial Plan does not include any tax rate increases.  The Town’s sales tax rate remains consistent at 4 percent.  The property tax mill levy is projected to be lower than the current rate of 1.330 based on preliminary property valuation for the Town that reflects an 18 percent increase over the prior year.  Per Town Code, property tax growth is limited to 5.5 percent annually, which will reduce the mill levy to 1.187 based on the preliminary valuation information.  The actual mill levy will be determined after final valuation is available from the County in November. 

 

A decrease of 3 percent for wastewater fees for the typical existing residential water customer is included, along with an increase in growth-related water system development fees.  In order to better accommodate growth related projects, planning also includes increasing Town development impact fees to the maximum allowable fee in 2020 rather than phasing in the increase over multiple years as previously approved.  Projections also include a 13 percent increase in healthcare cost for both the Town and its employees.  The Balanced Financial Plan includes 11 additional FTEs in 2020 including three police positions, one in the Division of Innovation and Technology, six in Castle Rock Water, and one for the Community Center.

 

Overarching goals of the 2020-2024 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

 

2020 Budget Priorities

 

The 2020 Budget priorities used as the basis for development of the 2020 - 2024 Balanced Financial Plan can be summarized as follows:

 

                     Ensure outstanding public safety

                     Enhance our transportation

                     Secure our water future

                     Maintain strong parks and recreation

                     Support economic development

                     Manage Town finances conservatively

 

Council has affirmed the above priorities and approach throughout the 2020 Budget process.  These priorities are also supported in the 2019 community survey results as previously presented to Town Council.

 

Financial Overview

 

The 2020-2024 Balanced Financial Plan was developed using conservative and informed financial modeling and forecasting.  Annual growth in sales tax revenue is included at 4 percent for 2020 and 3 percent for 2021-2024.  Residential growth is expected to continue to be strong over the five-year planning period and is budgeted at 700 single-family units and 128 multifamily units in each year.

 

Based on these revenue assumptions, the General Fund operating budget is balanced in each year from 2020-2024.  This is with the inclusion of Town and employee medical and dental insurance premium increases along with departmental budget requests related to level of service needs.  Several department requests were unable to be included into financial planning based on fiscal constraints in the projections.

 

Financial Details

The 2020-2024 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 projected resources.  Included within the plan are 11 additional FTEs for 2020 needed to address top-priority level-of-service needs, along with needed 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 2020, by fund and by department.

 

GENERAL FUND

Police Department:

                     Add a middle school School Resource Officer for a full year, along with two other Police Department positions, for an ongoing annual cost of $340,963; one additional vehicle (paid from Police Capital) and equipment are included to support these positions, which will cost $90,003

Fire Department:

                     Transfer $695,044 to the General Long-term Planning Fund for the replacement of Self Contained Breathing Apparatus (SCBA) and other future equipment replacement needs

Parks & Recreation Department:

                     Annual trail improvements planned for $285,000

Division of Innovation and Technology:

                     Add a Security and Access Control Coordinator position for $134,523, including salary and benefits

TRANSPORTATION FUND:

                     Craig and Gould Infrastructure for $3,100,000

                     Annual pavement maintenance program costs totaling $6,780,000, plus street reconstruction projects of $3,806,000

                     Traffic signal program costs of $640,000 for two new traffic signals and $125,000 for signal operation and maintenance adjustments

                     Downtown alley improvements for $315,000 plus Downtown Alley Master Plan for $200,000

                     Guardrail repair for $140,000

 

CASTLE ROCK WATER FUNDS (Combined):

                     Addition of six new positions for $566,823 including salary and benefits; positions include one Engineer Project Manager, three Water Plant Operators, and two Field Services Repair Operators

                     Water supply well projects totaling $3,300,000

                     Water storage projects totaling $4,025,000

                     Expenses of $400,000 for upgrades to the pumping and distribution system

                     Rehabilitation and replacement of water lines for $1,098,000

                     Water Treatment Plant upgrades and equipment for $255,000

                     General Facility upgrades and replacements for $292,000 and construction costs for Administration and Customer Service Building for $4,048,805

                     Customer billing software for $350,000

                     Costs of $4,833,000 for continuation of the WISE project

                     Chatfield reallocation project costs of $1,132,996

                     Continuation of the Alternative Source of Supply project for $5,800,000

                     Newlin Gulch project for $3,000,000

                     Castle Rock Reservoir expenses of $325,000

                     Miscellaneous projects, including stream gages, for $200,000

                     Purchase of Cherry Creek water rights for $5,000,000

                     Additional Parker Water and Sanitation District capacity for $250,000

                     Stabilization of streams and minor drainage ways for $1,183,767

                     Plum Creek wastewater interceptor upsize for $2,500,000

                     Wastewater lift station upgrades for $422,000 and sewer line rehabilitation for $500,000

                     Plum Creek Water Reclamation Authority expansion and projects totaling $3,271,219

                     Craig and Gould improvements and infrastructure for $2,426,925

 

CONSERVATION TRUST FUND

                     Improvements at select Town parks for $1,150,000

PARKS AND RECREATION CAPITAL FUND:

                     Construction costs for a new neighborhood park in Cobblestone Ranch of $4,000,000

POLICE CAPITAL FUND:

                     Expansion of the Police Department parking lot for $430,128

TRANSPORTATION CAPITAL FUND:

                     Construction, design, and right of way acquisition related to the Crystal Valley Interchange for $5,100,000

                     Plum Creek Parkway widening and roundabout for $3,660,000

                     Highway 85 and 5th Street improvements for $1,200,000

                     Wilcox and South street roundabout construction for $600,000

 

GENERAL LONG-TERM PLANNING FUND (TECHNOLOGY AND CAPITAL REPLACEMENT):

                     Fire Department SCBA replacement for $1,034,000

                     Replace networking and wireless devices/hardware for 309,500

                     Remodel Fire Station 154 and 155 vehicle bays for $250,000

                     Synthetic turf replacement at Butterfield Park for $216,000

 

COMMUNITY CENTER FUND:

                     Parking lot improvements for $225,000

                     Funding for the minimum wage increase for a total of $204,312

GOLF FUND

                     Parking lot improvements for $120,000

FLEET FUND

                     Purchase of new and replacement vehicles for $1,908,294

CONCLUSION

 

The overarching goals of the 2020-2024 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.  Based on projected revenues, not all departmental requests were able to be accommodated; however, the included items align with Council priorities and endeavor to maintain levels of service in the community.  The 2020-2024 Balanced Financial Plan demonstrates that the ongoing initiatives set forth within the 2020 Budget are sustainable and the one-time requests are able to be accommodated.

 

Staff Recommendation

 

Staff recommends that Council approve the 2020-2024 Balanced Financial Plan as presented.

 

Proposed Motion

 

“I move to approve a Resolution Approving the 2020-2024 Balanced Financial Plan.”

 

Attachments

 

Attachment A: Resolution

Exhibit 1: 2020-2024 Balanced Financial Plan