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CEDAR KEY BEGINS ANNUAL BUDGET PROCESS,
NEXT MEETING TONIGHT
*** Public Welcome ***
July 24, 2014
 
 
The Cedar Key City Commission met for its first 2014-2015 budget workshop on Tuesday evening, July 22, 2014, at 6pm in City Hall.  In attendance were Mayor Dale Register, Vice Mayor Sue Colson, and Commissioners Royce Nelson and Nettie Hodges.  Commissioner Tina Ryan did not attend.
 
Staff in attendance included Police Chief and Public Works Director Virgil Sandlin, Fire Chief and Building Department Manager Robert Robinson, City Clerk Teresa George, and staffer Lisa Fine.  Newly-hired Robert Beauchamp of Beauchamp and Edwards, CPAs, attended.   City Attorney Norm Fugate did not attend but, explained Mayor Register, was available by telephone should he be needed.
 
In the audience were:  Allison Nelson, Bob and Jeri Treat, Jean Rigg, Mandy and Frank Offerle.
 
OVERVIEW
Though the evening was planned around an ordered, thoughtful agenda, much necessary discussion, and possibly learning-on-the-job, interrupted the meeting’s clarity. Consider the following. 
  • One commissioner was not in attendance.
  • The second commissioner has had the opportunity to sit on the commission for one half of one meeting.
  • The third commissioner has been on the commission for only two plus months.
  • The forth commissioner, though he has chaired the CRA, has been on the commission since 2001.
  • Only two of the four commissioners sitting this evening have ever sat through a budget discussion. 
  • Four of the five commissioners were not on the commission at the inception of the CRA loan agreement and its requirements.
MILLAGE RATE
The City of Cedar Key must declare its tentative millage rate and submit that rate to the county and the state by August 4, 2014. The actual millage rate for 2013-14 was 5.5000.
 
A millage rate is defined as “a rate of taxation expressed in mills per dollar” (www.merriam-webster.com/dictionary) or “a tax rate that is applied to the assessed value of real estate. Millage rates are expressed not as regular percentages, but in tenths of a penny.  For example, a millage rate of two mills would mean two tenths of a penny (www.taxes.about.com).
 
It was stated that the tentative rate is generally set higher than a rate city anticipates they will need due to the fact that the final rate may be set lower than the tentative rate but it may not exceed the tentative rate. At the end of the evening, after much discussion, the millage rate to work with initially was still unclear.  Colson suggested that the rate be tentatively set at 6; Register and Nelson agreed that the rate should be set at the rollback rate of 5.4950. The proposed millage rate will be set at the July 29th Tentative Budget Hearing.
 
 CITY AND CRA BUDGET MIXING
Mayor Register’s budget presentation contained both City and Community Redevelopment Agency (CRA) monies.   Register explained that he had done so as the two were integrally related and should form the basis of a sound start to the budgeting process.
Register said that his reason for combining the City and the CRA dollars, in the line items of personnel, parks, was because the CRA will most probably be unable to make a full debt payment in the 2015-2016 fiscal year.  Transferring some expenses to the City’s budget now would enable the CRA to more fully repay that years debt.   He cited the fact that 90% of one City Public Works staffer’s salary is currently paid for by CRA funds and that, indeed, that worker spends far more than 10% of his time on City labors.  
Register further explained that he did not want to fail to repay the SunTrust CRA loan.  He knew that he might have to do so should property values not increase, but that non-repayment was not his choice, by any means.
 
Commissioner Sue Colson expressed her strong disagreement with combining the figures, citing the requirement that the City and the CRA function as two separate entities.  She said she saw “no need to mingle the funds,” that it made her “uncomfortable.”  “Once you start mixing, it’s a problem,” she said.
 
Register responded saying that he had conferred with attorney Fugate who opined that there was “no problem” discussing the two budgets in the same workshop.  Resultant City and CRA budget decisions would be made in separate, appropriately titled meetings.
 
Colson remained adamant that the two budgets be disaggregated and dealt with separately.
Commissioner Royce Nelson opined that “The CRA and the City are the same thing, it’s still our tax dollars” and that regarding the CRA, “it’s served its purpose.” Default is default.”
Colson responded that the requirement has been and is that the City and the CRA are, indeed, separate, that they must “not mingle the money or the people,” meaning that when the City meets, the group members are termed and function as commissioners; when the CRA meets, the group members are termed board members.
 
Commissioner Colson explained that the “CRA money come from pledged taxes.” Some of the money was pledged for repayment of the (loan) and some of the money was to be used for the operation of the CRA and maintaining the CRA properties that were bought or improved.
  
Resident Jeri Treat posed a “broader look at the problem.”  She commented that commissioners continue to talk about property taxes rising and that such a position unrealistic.  
Another member of the audience asked that if having the City assume and pay the CRA’s operating expenses (therefore making more funds available for the loan repayment) was not the same as using City funds to help make CRA loan payments.
 
NEXT MEETING PLAN
Clerk George was instructed to: separate the City and the CRA funds; work with Robert Beauchamp to disaggregate the insurance numbers so that each department’s insurance expenditures are reflected in that department’s budget; with Beauchamp’s help, disaggregate the insurance for the City’s buildings; and communicate with persons responsible for setting the county and the school millage rates.
   
FUTURE CAPITAL OUTLAY AND MAINTIANING STANDARDS NEEDS
Colson expressed concern that the group designate dollars for capital outlay needs, such as new roofs, mower replacement, painting, and the like.  She further urged the group to set aside dollars that would assure the quality of life be maintained and deterioration is prevented, such as aging picnic tables, deteriorating Cemetery Park and City Park playground equipment, fading signage, and the like.
 
CARRY OVER FUNDS
If all precedes as planned and budgeted, $255,911 will be carried over from the current 2013-2014 budget to the 2014-2015 budget.  Unseen expenses or emergencies could impact that figure.  Beauchamp suggested that carry over funds not be used for any recurring expenses and should be used a contingency and emergency fund.
 
AUDIT COMMITTEE TO MEET
The audit committee consisting of Mayor Register, Commissioner Royce Nelson, and City Clerk Teresa George will meet at 5:15pm on Tuesday, August 5, 2014, at City Hall to finalize its decision to either hire Purvis, Gray, and Company as auditors for the upcoming 2013-2014 audit or to post and request for proposals for another firm. 
 
 
City of Cedar Key
Meeting & Budget Workshop Dates
 
July 2014
Thursday, July 17 - Budget Workshop @ 6 pm (cancelled)
Tuesday, July 22 - Budget Workshop @ 6 pm
Thursday, July 24 - Budget Workshop @ 6 pm
Tuesday, July 29 - Tentative Budget Hearing & Set Proposed Millage Rate @ 6 pm
 
August 2014
Tuesday, August 5 - CRA/City Meeting @ 6 pm
Thursday, August 7 - Budget Workshop @ 6 pm
Tuesday, August 19 - City Meeting @ 6 pm
Thursday, August 14 - Budget Workshop @ 6 pm
Thursday, August 2l - Budget Workshop @ 6 pm
 
September 2014
Tuesday, September 2 - CRA/City Meeting @ 6 pm
Tuesday, September 16 - City Meeting @ 6 pm
September Budget Workshop Dates: TBA 
 
 
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