1. City of Cottonwood Budgetary Workshop I May 29, 2008 6:00 p.m. City Council Chambers

2. City’s Budget Shortfall This is what department heads started with— ($2,297,465) (including $100K in Undesignated Reserves) No additional staffing No reclassifications No new programs or contracts This is a barebones base budget number

3. Reality Check On Our Main Revenue Sources Sales tax down 10.4% in FY 2008 Sales tax expected down by 3.0% in FY 2009 State Shared Revenue is down Urban Revenue-5.7% State sales tax-4.5% Local car dealership moved out of town

4. Dealing with the Reality Check Eliminated Cost Of Living Adjustment – COLA Eliminated Compensation Study Elimination of positions Reduction in overtime

5. Dealing with the Reality Check Reduction in temporary staffing services Hiring freeze Reduction in maintenance Building maintenance Vehicle maintenance Grounds maintenance

6. Dealing with the Reality Check Reduction in fuel Reduction in contractual services (legal, ground maintenance) Reduction in services (community policing, swimming pool hours, Emergency Medical Services, public safety inspections) Reduction in recreational programs (Rhythm & Ribs, summer youth programming)

7. Dealing with the Reality Check Reduction in training and continuing education Reduction in travel/change in travel policy Reduction in book purchases Reduction in networking services

8. Dealing with the Reality Check Reduction in support to outside agencies Old Town Association - OTA Senior Center Youth Commission Additional reductions Supplies Subscriptions Postage & freight Small tools and operating supplies

9. City’s Budget New Shortfall After all these budget cuts the new balance is – ($602,710) (including $50K in Undesignated Reserves)

10. Projected 2.2% Sales Tax (Pre – Recreation Center – Summer 2006)

11. Police Department Loss of 3 Patrol positions Increased response time Reduced visibility Increased safety risk to on duty officers Overtime reduction Reduced public relations (block watches, school talks, multi- housing inspections) Reduced patrol time on streets Reduced presence at public events ( Verde Valley Fair, Smoke Out west, Christmas Parade)

12. Police Department Reduced vehicle maintenance Tire replacement will be delayed Reduced car washes will lower public image Small repairs will be delayed, possibly causing larger repairs costs in the future Reduced Training limits growth of staff knowledge, skills and abilities that could increase safety and save lives In general As the economy gets worse, crime rises Inability to perform services at prior professional level

13. Animal Control/Communication Animal Control Increase in dog at large issues No work at the dog park Communications Increasing stress on staff due to reduced staff Reduced supervision, since supervisor will need to cover a shift Increased time to rebuild with staffing changes Increased risk to officers on duty due to working with obsolete, broken or faulty equipment due to budget cutbacks

14. Fire Department Loss of one existing Firefighter/Medic Non-compliance with Occupational Safety & Health Administration (OSHA) – 2 in/2 out Increased public and firefighter risk due to longer response times The inability to respond to multiple events or requests for service is significantly increased Already need an additional staffed 4 person engine company

15. Fire Department Absences will need to be covered by volunteer staff at a time we are cutting volunteer funding Non– compliance with Federal, and State regulations and standards related to staffing, response times, and public & firefighter safety Loss of ½ time fire prevention support position Reduced public fire and life safety education Reduced building fire safety inspection Reduced participation in community events

16. Fire Department Reduced travel, training & continued education Limits growth of staff knowledge, skills and abilities Increase in liability by failure to meet; OSHA Insurance Services Office (ISO), and National Fire Protection Association (NFPA) Standards Reduces eligibility for grant, federal, and disaster aid (grants can’t supplant) Reduced operation supplies Increased health risks – Blood Borne Pathogens/ Communicable diseases/hearing damage Loss of technical advantage/service quality Reduced standard of care in emergency medicine

17. Fire Department Deferred maintenance of vehicles, equipment, and radios Increases long-term costs Efficiency, and reliability is compromised Deterioration of standard of excellence Decreases safety and public image

18. Parks & Recreation Elimination of Recreational Programs & Events Rhythm & Ribs Event Summer programming Youth Basketball Summer internships Camping Series Overtime budget cuts Cannot support after hours programming Remaining programming will suffer

19. Parks & Recreation Early pool closure around September 1st Reduced services to public Affects Mingus High School most of all If they need it they will have to provide full funding Affects a group of lap swimmers and evening swim programs Weight-room – reduced hours of operation Will affect weight-room patrons

20. Facilities Maintenance Reduced cost of facilities maintenance Field over-seeding program is impacted Annual tree pruning, and weed-herbicide will be reduced Bldg maintenance schedules will be extended Repairs on exteriors and interiors will be postponed Custodial cleaning services eliminated on Fridays except PD and FD

21. Other Impacts to Parks and Recreation Current impacts Children will not have much to do during the summer City will not have a signature event Pool early closure will probably not go unchallenged Parks will look ill maintained Lengthened maintenance schedules could cause early failure of equipment. Buildings will fall in ill repair Old Town building will cost more later to repair

22. Other Impacts to Parks and Recreation Upcoming impact – Recreation Center City may not have the ability to cover the O&M on the Recreation Center

23. Library Reduction in book purchases will age our collection Traffic continues to increase and resources are not available Concerns over being able to fund the O&M for the new addition to the Library

24. Utility Department Eliminated sales tax contribution to Sewer Fund Capital fund will grow only by interest Capital program will be modified to fit within the new model City is looking at smaller package plant vs. regional plant Department has reduced its budget to comply with overall City directive

25. Utility Department Both Water & Sewer contribute to the GF Contribution to Natural Resources position (50%) Will contribute to 25% of PW for engineer’s services Utilities contribute $266,000 to GF in indirect costs Despite staffing constraints this department continues to maintain the Clarkdale water system and brings in additional revenues to our Utility Co.

26. Impacts on All Departments Reduction in staff, compensation, COLA Stress will affect all personnel in general Stress due to uncertainty of their jobs Stress over maintaining our high level of services The general feeling of “who” or “what’s” next Employees can’t keep up with rising costs Stress will drive up our health insurance Stress will increase our absenteeism Reduction in training & travel Forego ability to acquire and implement knowledge and skills Lower employee morale

27. Impacts on All Departments Reduction in supplies, materials, & tools Reduction in quality of supplies and materials used Inability to do the job properly Increased health & safety risks Increased liability to the City due to cuts Grounds/Building Maintenance Parks will look bad and will increase our liability due to lack of maintenance Increased costs for building maintenance in the future

28. Impacts on All Departments Sacrificing services and programming Reducing support for outside agencies

29. Other Potential Cost Savings 10/40 schedule for employees Open 4 days a week 7:30 a.m. to 5:30 p.m. Savings on utility costs Travel Policy Changes Reduce daily per-diem for meals Review mileage reimbursement Cellular Phone Policy Changes Shift service responsibility to employee Will lower costs to the City

30. Revenue Options Adopt the new building fees Current downturn in the housing market will not make much revenue for the City Increase in fees concentrated on commercial property Increases the cost of building projects Positions the City for future growth

31. Revenue Options Adjust all 1% sales tax allocation away from streets to General Fund Street projects will be postponed General Fund capital will be delayed We have already affected the sewer facility We have been to this trough before Not sure when, if ever, we will be able to adjust the allocation back to the Streets or GF capital

32. 1% Sales Tax Distribution

33. Revenue Options Increase in sales tax All current 1% sales tax allocations remain in place Street projects can be scheduled with sales tax revenue General Fund capital, too, will be scheduled with sales tax revenue We will still need to watch our spending, but will be able to avoid layoffs Will make every effort to keep existing programs and contributions to outside agencies

34. Sales Tax Comparison

35. Property Tax Comparison

36. What now????? Council and staff discussion Staff needs direction Proceed with more reductions to balance the budget Council will support a revenue increase A combination of added reductions and a revenue increase (and where do we concentrate)