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Home My WebLink Aboutagenda.council.worksession.201907161 AGENDA CITY COUNCIL WORK SESSION July 16, 2019 4:00 PM, City Council Chambers 130 S Galena Street, Aspen I.COUNCIL ROUNDTABLE 4:00-4:10 II.WORK SESSION II.A.General Fund Overview and 2020 Budget Assumptions and Benefits Update 1 General Fund / AMP – High Level Overview July 16, 2019 2 General Fund (2019 Budget) Department Related Collections $12,022,830 GF Overhead Allocations $5,359,400 City Share of County Sales Tax $9,839,000 Property & Ownership Tax $4,384,000 Occupation Taxes $1,486,000 Transfers $2,149,530 Other Revenues $829,420 2019 Revenue Mix of Taxes and Fees •Share of County Sales Tax •Property Tax (55% Split) •Overhead Allocations •Department Collections •City Tobacco Tax (2018 1st Yr ) $279,150 $106,650 $185,630 $448,260 $477,000 $1,089,000 $2,427,140 $7,010,000 $0 $2,000,000 $4,000,000 $6,000,000 $8,000,000 All Other Depts Env. Health Police Red Brick Arts Streets Engineering Recreation Com. Dev. 3 General Fund (2019 Budget) Administrative Plus Grants $9,924,510 ComDev and Engineering $6,058,720 Red Brick Arts $529,320 1%Recreation $4,689,500 Police $5,379,310 Parks (Downtown) $216,200 1% Streets $1,997,990 Environmental Health $694,060 Events $887,830 IT Overhead $1,160,700 3%Transfers $5,427,350 15% 2019 Uses •Administrative Offices •City Council, Clerk, City Manager Office, Human Resources, Attorney Office, Finance, Asset Management •Development •Building and Planning Offices •Public Works •Streets and Engineering •Public Health and Safety •Police and Environmental Health •Recreation & Arts •Aspen Recreation Center, Aspen Ice Garden, Parks Downtown Malls, Events, Red Brick Arts4 Asset Management Plan (2019 Budget) Property Tax (45%) $3,383,000 Interest & Other Revenue $361,680 Transfers $2,858,400 Debt Proceeds $26,000,000 2019 Revenues •45% of General Property Tax •One-Time Sources •Debt Financing (City Offices) •Cash Transfers (City Offices +) •Transp: $2.0M •Parking: $3.7M 5 Asset Management Plan (2019 Budget) Asset Management $10,358,300 Engineering $1,288,000 Streets $1,654,450 Recreation $1,011,000 Other GF Departments $455,900 Operational Costs & Debt Service $113,700 2019 Uses •Asset Management: ❑New City Offices: $6.5M ❑Pedestrian Mall: $3.7M •Streets: ❑Three Year Paving Cycle: $875K ❑Annual Fleet Replacement (7Yrs/80K): $725K •Engineering: ❑Annual Concrete Replacement: $453K ❑Garmish Bus/Ped Improvents: $165K ❑Streets to Trails: $130K ❑Hwy 82 Roundabout Evaluation: $128K •Recreation: ❑ARC Downstairs Remodel: $450K ❑Zamboni Replacement: $130K 6 Budget Process •Discussion with Council on Base Budget •Base (Existing Service Levels) •Supplementals (Additional Resources) •Budget Meetings on Proposed Budget •In Depth Discussion on Each Fund •Budget Adoption •Mill Levy (Dec 15) and Fee Ordinance 7 Revenue Update July 16, 2019 8 Revenue Update Total revenue (all funds) is below prior year through June •2018 included $5.1MM housing unit sales & $1.1MM in transportation grants •Other increases and decreases largely offsetting (permits / County sales tax) Jun-17, $51,998,002 Jun-18, $58,324,877 Jun-19, $50,359,023 $0 $20,000,000 $40,000,000 $60,000,000 $80,000,000 $100,000,000 $120,000,000 $140,000,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecRevenue CollectedCumulative Revenue by Month 2017 2018 YTD 2019 9 Revenue Update Tax-specific revenues (all funds) are up year-over-year •YTD Jun-19 tax collections are up 4.9% over the same period ‘18 and 10.6% over ‘17 Jun-17, $22,350,366 Jun-18, $23,571,517 Jun-19, $24,718,663 $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 $40,000,000 $45,000,000 $50,000,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecRevenue CollectedTax Revenue* by Month 2017 2018 YTD 2019 *Tax revenue includes sales, lodging, use and RETT taxes 10 Revenue Update Composition of revenue sources impacts fund cash flows $0 $10,000,000 $20,000,000 $30,000,000 $40,000,000 Housing Fund Parks Fund General Fund/AMP Fund Revenue by Source Tax Revenue Permits, Fees, Intergov Revenue*Other Revenue *Permit, fee and intergovernmental revenue includes state, local tax revenue, investment income and refund of expenditure 11 Revenue Update $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 Jan Feb Mar Apr May Jun General Fund/AMP Revenue (YTD) 2017 2018 YTD 2019 $0 $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 Jan Feb Mar Apr May Jun Parks Fund Revenue (YTD) 2017 2018 2019 $0 $500,000 $1,000,000 $1,500,000 $2,000,000 Jan Feb Mar Apr May Jun Housing Fund Revenue (YTD) 2017 2018 2019 12 Revenue Update City Sales Tax •2018 finished stronger than previously forecast •2019 taxable sales are up 6.9% through first five months o Softened Oct and Nov relative to 2018 actuals •2020 assumes minimal visitation growth o Largely just inflationary price pressure driving additional revenue 2018 Actual Taxable Sales Change 2019 Budget 2019 Projection 2018 to 2019 Change 2020 Projection 2019 to 2020 Change Accommodations 221,056,054 2%225,560,000 232,109,134 5.0%239,070,000 3.0% Restaurants 131,841,092 2%134,280,000 137,110,006 4.0%141,220,000 3.0% Sporting Goods*50,482,238 5%50,390,000 51,998,264 3.0%53,560,000 3.0% Clothing*60,354,675 5%59,410,000 62,183,416 3.0%64,050,000 3.0% Food & Drug 57,182,857 2%57,800,000 58,599,160 2.5%59,770,000 2.0% Liquor 10,745,724 2%11,045,000 10,960,588 2.0%11,220,000 2.4% Marijuana 11,757,528 4%12,606,000 12,108,714 3.0%12,470,000 3.0% General & Miscellaneous 64,668,136 28%59,700,000 67,902,000 5.0%69,939,000 3.0% Luxury Goods*30,027,455 2%30,450,000 33,031,687 10.0%31,390,000 -5.0% Utilities 46,076,938 6%47,378,000 45,155,125 -2.0%46,310,000 2.6% Construction 58,252,544 1%69,454,000 58,835,769 1.0%58,830,000 0.0% Automobile 20,038,125 -4%22,520,000 21,043,497 5.0%21,470,000 2.0% Total Taxable Sales 762,483,367 4%780,593,000 791,037,361 3.7%809,299,000 2.3% Net Tax 15,849,493 3%16,330,000 16,443,000 3.7%16,822,600 2.3% 13 Revenue Update Lodging Tax •2018 finished down 0.5% relative to 2017 •2019 taxable sales are up 8.7% through first five months o Advanced bookings showing hesitation but last year’s Dec was muted •2020 again assumes minimal visitation growth o ADR is forecast to be the underlying driver for revenue growth $922,069 $2,766,215 $968,300 $2,904,800 $997,300 $2,991,800 $0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 Transportation Marketing 2018 2019 2020 2018 2019 2020 (0.5%)5.0%3.0% 14 Revenue Update RETTs •Volatile source of income •2019 down roughly 2% year-to-date o Transaction volume is up, but transfers are not as big of dollars •2019 and 2020 projections to come in October Transactions Wheeler RETT Housing RETT Jan 28 $407,558 $784,556 Feb 23 $500,816 $895,243 Mar 23 $346,604 $672,397 Apr 23 $223,663 $425,425 May 28 $389,336 $741,897 Jun 21 $372,788 $721,175 2018 Thru June 146 $2,240,764 $4,240,693 Jan 33 $569,253 $1,105,098 Feb 14 $109,065 $204,130 Mar 41 $462,116 $892,017 Apr 34 $296,169 $551,428 May 31 $448,417 $793,639 Jun 28 $312,614 $600,971 2019 Thru June 181 $2,197,635 $4,147,285 Change 24%(2%)(2%)15 Revenue Update City Share of 2.0% County Sales Tax •2019 projection assumes roughly 8% increase o Wayfair case has had an impact –up 13% year-to-date •2020 assume same 2.3% increase as City sales tax forecast City Use Tax •Seeing less activity on the new permit side -but bigger projects •This is future revenue -realized when project are completed o May realize less due to Wayfair case impact •Transportation Fund will still experience positive revenue for awhile Permits Deposits 2018 Thru June 65 $595,645 2019 Thru June 60 $965,534 Change (8%)62%16 2020 Budget Assumptions July 16, 2019 17 2020 Budget Assumptions Base Operations •2% increase based on CPI •Current LRP assumptions •Healthcare premium increases at 8% •Wage growth set at 3.5% 18 2020 Budget Assumptions Total Compensation •Near-term (2020) •Increase Annual Cafeteria Benefit from $800 to $1,000 •Increase Annual Wellness Benefit from $300 to $500 •Merit-based increase remains unchanged -up to 4% •Healthcare premium increase of 3% •Compensation plan structure increase of an avg. of 2% June 2018, 12.6%May 2019, 14.4% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% Staff Turnover Rate (Rolling Average) 19