HomeMy WebLinkAboutMIN JUN 10 2002 M I N U T E S - CITY OF BEAUMONT
Lulu L. Smith, Mayor Pro Tern EVELYN M. LORD, MAYOR Guy N. Goodson
Andrew P. Cokinos 2002 BUDGET SUMMIT Becky Ames
Bobbie J. Patterson June 10,2002 Audwin Samuel
Lane Nichols, City Attorney Stephen J. Bonczek, City Manager Lolita Ramos, Interim City Clerk
The City Council of the City of Beaumont,Texas,met in a special Budget Summit with administration
and staff on June 10, 2002, at the Tyrrell Park Garden Center, Beaumont, Texas, at 11:30 a.m.
Lunch was served at 11:30 a.m., and the Budget Summit opened at 12:15 p.m. Councilmembers
present were:Mayor Evelyn M.Lord,Mayor Pro Tern Lulu Smith,Councilmembers-At-Large Andrew
P.Cokinos and Becky Ames,and Councilmembers Guy Goodson,Audwin Samuel,and Bobbie J.
Patterson. Present were staff members: Stephen J. Bonczek, City Manager; Lane Nichols, City
Attorney; Lolita Ramos, Interim City Clerk; Kyle Hayes, Executive Assistant to the City
Manager/Economic Development Director; Marie Dodson, Human Resources Director; Kirby
Richard, Central Services Director;Tom Scofield, Police Chief; Micky Bertrand, Fire Chief; Ingrid
Holmes,Public Health Director;Tom Warner, Public Works Director;Maurine Gray,Library Director;
John Labrie,Clean Community Director;Sue Dismukes, Personnel Manager;and Andrea Deaton,
Budget Officer. Also, present were approximately 12 citizens.
The City Manager presented the City's current fiscal position, including projected end-of-the-year
revenues and expenditures,city projects completed and scheduled for completion,and proposals
for budget development for the fiscal year 2002-2003, as shown in Exhibit "A."
Topics discussed during the presentation included the following:
• Philosophy behind the strategic direction of the City.
• The Financial Outlook, including revenue and expenditure comparisons, fiscal year end
balances, and the year end fund balances and debt service fund balances.
• Section 108 Projects status.
• Year End Projections: Good News projections are industrial payments exceed FY2002
budget,higherthan expected fund balances,personnel cost savings,building permits growth,
increased employee safety containing workers compensation costs and fire training center
progress report.
• Year End Projections: Bad News projections are industrial payments for FY2003,proposed
expansion of the sales tax holiday,rising cost of property insurance,appraised values lower
than expected, sales tax receipts and increased transit operating costs.
• Alternative courses of action,the City is exploring to increase revenues and reduce spending.
• Long Range Financial Plan outlining impending capital improvements plan, scheduled
projects and an outline on the expenditure of funds from the sale of the Central Park land.
• A review of the proposal first discussed last year on the possibility of implementing a storm
water utility fee to replace the street user fee and generate money to avoid either a tax
increase or reduced city services.
Further discussion on the 2003 budget process was recessed at approximately 2:05 p.m. and
resumed at 2:35 p.m.,when the City Manager lead the discussion on the strategic issues facing the
City as it prepares for the new fiscal year.
Issues discussed concerning the budget development process were:
• Use of the Fund Balance and the percentage year-end fund balance acceptable forthe City.
• A proposal on a Stormwater Utility Fund, including costs per household and impact on
businesses,money such a fund would generate forthe general fund of the City and restricted
uses of the money from such a fund.
• Alternative revenue sources and solutions for reconciling the declining City transit funds.
• Costs and possibilities of implementing the Phase 11 of the City employee classification and
compensation plan and the impact on the general fund.
• Employee health insurance costs and general liability funding levels.
• Calendarforthe budget process,establishing the public hearing date and budget approval
deadline of September 27, 2002.
There being no other business, the Budget Summit ended at 3:30 p.m.
Evelyn M. Lor , Mayor
Lolita Ramos, Interi Cit .clerk
Minutes June 10,2002 Page 2
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Beaumont, Texas
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.budget Summit
June 10, 2002
EXHIBIT "A"
2002 BUDGET SUMMIT
MONDAY, JUNE 10, 2002
11:30 A.M. - 5:00 P.M.
THE GARDEN CENTER at TYRRELL PARK
�
CITY COUNCIL ADMINISTRATION
Evelyn M. Lord, Mayor Stephen J. Bonczek, City Manager
Dr. Lulu Smith, Mayor Pro-Tem Lane Nichols, City Attorney
Lolita Ramos, Interim City Clerk
Becky Ames, At Large
Andrew P. Cokinos, At Large Kyle Hayes, Executive Assistant to the City
Guy Goodson, Ward 11 Manager/Economic Development Director
Audwin Samuel, Ward III Marie Dodson, Human Resources Director
Bobbie J. Patterson, Ward IV Kirby Richard, Central Services Director
Tom Scofield, Police Chief
Michel Bertrand, Fire Chief
Ingrid Holmes, Public Health Director
Tom Warner, Public Works Director
Maurine Gray, Community Services Director
John Labrie, Clean Community Director
FACILITATOR
Stephen J. Bonczek
City Manager
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City of Beaumont, Texas
Mission
WORKING TOGETHER FOR A BETTER BEAUMONT
Providing our community with quality service
through courteous and dedicated employees
Guiding Principles
Integrity Doing the right thing all of the time
Communication Sharing information with each other and those we serve
accountability Being responsible for our actions
Respect Treating each other with dignity and valuing our diversity
Empowerment Having the ability and commitment to act in the public interest
"Creating value in public service"
2002 Budget Summit
Monday, June 10, 2002
11:30 a.m. - 5:00 p.m.
Location: The Garden Center @ Tyrrell Park
Facilitator: Stephen J. Bonczek, City Manager
Purpose
• To discuss strategic financial issues facing the City
• To identify alternative courses of action for addressing the issues
• To provide direction for the development of the 2003 City Budget
Introduction
• Purpose of the Summit
• Mayor/Council and Administration Expectations
Current Fiscal Situation
• Financial Report and Analysis - Seven Months (October 2001 - April 2002)
• Comparative Financial Analysis
• Revenues
• Expenditures
• Fund Balance
• Fiscal Year End Fund Balance
• Debt Service Fund
• HUD Section 108 Projects
Projected Financial Situation - Year End 2002
• Good News/Bad News 2001-2002
• Alternative Courses of Action
• Financial and Budgetary Challenges
• Ideas That Save Costs and Increase Revenue/Service Quality
• Engaging Citizens In the Budget Process
• Analysis of Fund Balance
Long-Term Outlook
• Long-Range Financial Plan (2002-2011)
• Capital Improvement Program
• Stormwater Utility
BREAK
Dress: Casual Food/Refreshments to be Provided
Participants: Mayor/Council, City Manager and Department Directors
The 2003 Budget
• The Budget Development Process
• Calendar for Budget Planning
• The Role of the Financial Improvement Team(FIT)
• Strategic Action Plan
• Issues
• Use of Fund Balance
• Creation of a Stormwater Utility Fund
• Administration Stormwater Utility Proposal
• Maintain Stability/Alternative Revenues/Cost Controls and Reductions
• Reduction in State Transit Funding and Increased Operating Costs
• Classification-Compensation Plan- Phase 11
• Employee Health Insurance
• General Liability Funding Level
• Discussion
• Budget Reconciliation Plan for FY 2003
Dress: Casual Food/Refreshments to be Provided
Participants: Mayor/Council, City Manager and Department Directors
2002 BUDGET SUMMIT
MISSION
This meeting is planned to provide a forum for the Mayor/City Council and Administration
to achieve consensus on major financial/budgetary policy issues facing the community in
FY2003 and then for Council to provide direction to the Administration.
ROLE OF MAYOR AND COUNCIL
The Mayor and Council will discuss issues of concern and assist the facilitator in bringing the
discussion to an agreed upon closure. This closure will provide the Administration with
operational direction in preparation of the FY2003 budget.
ROLE OF ADMINISTRATION
The City Manager and Department Directors are present for the purpose of providing the
Mayor and Council with information when required, to clarify discussions and to participate
in the dialogue as appropriate.
ROLE OF FACILITATOR
The City Manager as facilitator will provide a brief introduction on the issue resolution
process,then direct discussion along the lines ofthe agenda stimulating participation from the
Mayor, members of Council and the Administration while assisting in bringing discussion to
closure.
FINANCIAL REPORT AND ANALYSIS
M O N T H L Y
_ Finance Department
R E P O R T
April 2002
INSIDE Accounting The CIP will provide information
Accounting . . . . . . . . . . . . . . . . . . . . . . . . / relative to major construction
Administration. . . . . . . . . . . . . . . . . . . . . . I either underway or scheduled to
Budget and Grant Administration . . . . . . . I Performance
Cash Management . . . . . . . . . . . . . . . . . . . I Report begin in FY 2003. The financial
Water Customer Service. . . . . . . . . . . . . . . 2 impact of the funding needs will
Monthly Financial Report . . . . . . . . . . . . . 2 The financial report for the month then be incorporated into the FY
of April is submitted with this 2003 Operating Budget. In
report. Audit adjustments have accordance with City Charter, the
been recorded and beginning fund l CIP will be submitted to Council
balances reflect audit balances. May 15, 2002..
Other comments appear under
"Monthly Financial Report." Prior to the publication of April
monthly report, the date for the
annual Budget Summit was in the
Administration process of being rescheduled. Staff
will be in contact with Mayor and
The FY 2001 Popular Annual Council to determine a new date.
Financial Report (PAFR) has been
completed and is currently being
i distributed to the public. Both the Cash Management
PAFR and the FY 2001 CAFR are Three new small business loans
i �,
; 1.j �5 �.4 now available for viewing on the were approved by the Committee
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Citys web page.
r * ,` during the month; Triangle Gold
Books LLC ($22,500), Spotlight
Magazine ($10,000), and
Budget and Grant P-Beaux's Restaurant ($10,000).
Administration The balance of available funds is
j $310,117.
Following the submission of the
Finance Department
City of Beaumont Long Range Financial Plan, the
EMS collections for the month of
next step in the April were $181,999 which
budget process exceeds the estimated amount by
Finance Direoctor oze
Stephen J. B is preparation `gyp` ® $31,000. Year to date collections
and '
total$1,046,452. The total
7
Kandy Daniel, Treasurer submission of number of billings was up from
Andrea Deaton, Budget Officer the Capital B the previous month at 705.
Paula Labrie, Controller Improvement
Plan(CIP).
■April 2002 Finance Department
HOTEL OCCUPANCY TAX
Water Customer FUND
i
Service Revenues are have been right on
Delinquent notices for target with budget projections.
April water billing decreased Staff will continue to monitor and
to 5,672 notices mailed. The ° adjustments will be made as
number of phone calls fielded by the needed.
customer service employees is
up from March at 7,698. The
use of direct debit continues to
grow and has increased this I CASH AND INVESTMENTS
month to a total of 3,439 Cash and investments total
participants. $46.7M. This compares to $68AM
as of the same period for fiscal
d year 2001. Investment revenue
Monthly Financial earned year-to-date totals
$993,330 compared to $2,296,008
Report for fiscal year 2001. The year-to-
The Monthly Financial Report for date average yield on sold or
the month ended April 30, 2002, is maturing investments for fiscal
submitted along with highlights year 2002 is 6.00% compared to
where applicable. It is the seventh 2001's average yield of 5.88%.
month of the fiscal period and The City's current investment
beginning balances have been portfolio is providing an average
adjusted to reflect FY01 year-end yield of 2.79% with an average
audit adjustments. Preliminary maturity of 247 days at April 30,
projections have been established 2002.
and will be reviewed and modified I
on a monthly basis. i
GENERAL FUND
Sales Tax of$1.8 million received
for the period is 2% above last
fiscal year. Revenues represent
sales for the month of February and
reflect an increase from the
previous year although year to date
collections are $95,434 or .7%
below the budgeted amount. Sales
tax will continue to be monitored
on a monthly basis and the forecast
revised if needed. Most
expenditures appear to be on i
budget.
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general fund
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CITY OF BEAUMONT
GENERALFUND
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
FYE 2002 Favorable/
Current Actual Projected at Year-End to
_ Month Year To Date _04130/02_ _ Budget _Budget
REVENUES
Sales and Use Tax $ 1,910,875 $ 13,494,376 $ 26,752,000 26,752,000 -
Property Taxes 148,840 11,743,305 12,213,000 12,213,000 -
Industrial Tax Payments 645,313 12,310,704 12,310,704 11,728,700 582,004
Gross Receipts Tax 823,769 1,634,876 6,350,000 6,350,000 -
Utility Fund in Lieu 425,000 2,975,000 5,100,000 5,100,000 -
Charges for Services 253,777 1,418,850 2,486,900 2,486,900 -
Fines and Forfeits 157,751 1,111,233 2,007,400 2,007,400 -
Licenses and Permits 67,694 783,518 1,272,000 1,272,000 -
Culture and Recreation 91,890 489,674 789,400 789,400 -
Interest Earnings 36,238 178,851 450,000 600,000 (150,000)
Intergovernmental Revenue - - 1,000 1,000 -
Miscellaneous Revenue 45,610 608,238 1,075,800 1,075,800 -
TOTAL REVENUES 4,606,757 46,748,625 70,808,204 70,376,200 432,004
EXPENDITURES
Police 1,588,146 11,235,563 19,444,600 19,494,600 50,000
Fire 1,098,688 8,087,307 14,230,100 14,230,100 -
Public Works 1,006,576 6,487,908 11,822,100 11,822,100 -
Central Services 524,652 3,472,448 6,652,400 6,552,400 (100,000)
Public Health 344,686 2,371,909 4,573,100 4,573,100 -
Library System 215,337 1,448,093 2,646,000 2,646,000 -
Finance 93,784 608,497 1,137,400 1,187,400 50,000
City Clerk 74,474 601,484 1,084,500 1,094,500 10,000
General Government 62,935 589,846 1,021,400 1,021,400 -
Economic Development 58,827 405,138 846,100 846,100 -
Human Resources 53,570 382,396 678,700 678,700 -
City Attorney 47,785 367,786 622,700 622,700 -
Special Purpose 588,075 4,116,525 7,056,900 7,056,900 -
TOTAL EXPENDITURES 5,757,535 40,174,900 71,816,000 71,826,000 10,000
EXCESS REVENUES OVER
(UNDER)EXPENDITURES (1,150,778) 6,573,725 (1,007,796) (1,449,800) 442,004
FUND BALANCE
Beginning Fund Balance 15,129,029 7,404,526 7,404,526 7,163,084 241,442
Ending Fund Balance $ 13,978,251 $ 13,978,251 6,396,730 5,713,284 683,446
3
CITY OF BEAUMONT
GENERALFUND
REVENUE SUMMARY
For the seven months ended April 30,2002
FY 2002 FY 2002
FY 2002 Estimate at Actual at Over/(Under)
REVENUES Budget 04/30/2002 04/30/2002 Estimate
Sales and use tax 26,752,000 13,556,442 13,494,376 (62,066)
Property taxes 12,213,000 11,727,216 11,743,305 16,089
Industrial payments 11,728,700 11,728,700 12,310,704 582,004
Gross receipts tax 6,350,000 1,570,762 1,634,876 64,114
Utility fund in lieu 5,100,000 2,973,810 2,975,000 1,190
Fines and forfeits 2,007,400 1,146,969 1,111,233 (35,736)
Charges for services 2,486,900 1,399,889 1,418,850 18,961
Culture 8 Recreational 789,400 503,091 489,674 (13,417)
Licenses and permits 1,272,000 655,493 783,518 128,025
Interest earnings 600,000 353,400 178,851 (174,549)
Intergovernmental rev. 1,000 94 — (94)
Miscellaneous revenue _._ 1,075,800 _ 613,854 608,238 _ {5,616)
TOTAL REVENUES 70,376 200 46 2, 29.720. _ 46,748,625 518,905
MONTHLY CASH FLOW
Beginning Ending
Cash Balance Receipts Disbursements Cash Balance
October 8,320,512 3,381,452 4,934,278 6,767,686
November 6,767,686 4,920,549 7,424,591 4,263,644
December 4,263,644 6,649,890 5,535,379 5,378,155
January 5,378,155 17,662,504 6,939,934 16,100,725
February 16,100,725 9,312,066 5,448,450 19,964,341
March 19,964,341 3,883,049 6,017,460 17,829,930,
April 17,629,930 5,127,524 6,469,985 16,487,469
May 18.487,489 4,243,308 5,985,5()0 14,705,277
June 14,705;277 3,239,526 5,985,50 11,959,303
July 11,959,303 7,460,778 5,985,500 13,434,581.
August 13,434;581 3,954,582 5,885,500 11,413,663
September 11,413;663 _4,026,168 5,985,500 9,454,331
73-831,396 72,697 577_
[� Estimated
4
Enterprise funds
CITY OF BEAUMONT
WATER FUND
BALANCE SHEET
April 30,2002
_ AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 4,388,530 Escheat Clearing $ 10,052
Utilities Receivable(Net) 2,062,657 Accounts Payable 55,095
Other Receivables 35 Accrued Wages Payable 242,572
Inventories 1,177,313 Customer Deposits 891,430
1,199,149
Fund Balance
Reserve, Receivables 2,062,692
Reserve, Inventories 1,177,313
Unreserved 3,189,381
6,429,386
TOTAL AVAILABLE RESOURCES $_-._7,628,535 TOTAL CLAIMS ON RESOURCES $-.-_7 628 535
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CITY OF BEAUIMONT
WATER FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
_ Month_ Year To Date 041.3012002 Budget _ _ Budget
REVENUES
Residential Water $ 843,118 5,904,944 10,818,000 11,000,000 (182,000)
Residential Sewer 584,152 4,012,740 7,042,000 7,200,000 (158,000)
Major Accounts 475,598 3,613,043 6,655,000 6,344,000 311,000
Service Charges 102,990 721,707 1,200,000 1,100,000 100,000
Interest Earnings 21,234 329,450 730,000 800,000 (70,000)
Miscellaneous Revenue 765 73,293 76,000 26,000 50,000
TOTAL REVENUES 2,027,857 14,655,177 26,521,000 26,470,000 51,000
EXPENSE CATEGORY
Operating
Sewer Maintenance 195,066 1,552,457 2,727,900 2,727,900 -
Production 187,858 1,280,647 2,434,100 2,434,100 -
Distribution 203,095 1,431,858 2,532,900 2,532,900 -
Reclamation 124,368 859,332 1,606,500 1,681,500 75,000
Customer Service 83,309 595,304 1,069,900 1,069,900 -
Administration 52,375 384,163 788,900 828,900 40,000
Non-Operating
Debt Service - 1,755,042 5,619,700 5,619,700 -
Payments in Lieu of Taxes 362,500 2,537,500 4,350,000 4,350,000 --
Other 6
___8_6 891_ 2,976,008 4,680,900 _ 4,680,900 -
- 1 _
TOTAL EXPENSES 2,075,462 13,372,311 25,810,800 25,925,800 115,000
EXCESS(DEFICIT)REVENUES
OVER EXPENSES (47,605) 1,282,866 710,200 544,200 166,000
FUND BALANCE
Beginning Fund Balance 6,476,991 _5,146,520 _5,146,520 _ 6,163,049 (1,016,529)
Ending Fund Balance $ 6.429,386 6,429,386_ .5 856 720 6.707,2 (850 529)
Note: Major Accounts consist of all customers in a given month with total Water and Sewer charges over$2,500.
7
CITY OF BEAUMONT
SOLID WASTE FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 2,677,335 Accounts Payable $ 33,303
Utilities Receivable(Net) 571,476 State Disposal Fees Payable 85,884
Other Receivables 141,405 Accrued Wages Payable 84,890
204,077
Fund Balance
Reserve, Receivables 712,881
Unreserved 2,473,258
_ 3,186,139
TOTAL AVAILABLE RESOURCES $ 3,390.216_ TOTAL CLANS ON RESOURCES $__ _ 3 390.216.
8
CITY OF B EAUMONT
SOLID WASTE FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month_ Year To Date _041301200.2 Budget Budget
REVENUES
Residential Collections $ 383,091 2,674,895 4,591,000 4,591,000 -
Landfill Fees 137,055 939,123 1,552,000 1,282,000 270,000
Interest Earnings 5,493 60,320 100,000 100,000 -
Clean Community Fees 22,389 157,714 264,000 264,000 -
Miscellaneous Revenue 193 _66,300 _ 81,000 21,000 60,000
TOTAL REVENUES 548,221 3,898,352 6_588,000 6,258,000 _ 330,000
EXPENSE CATEGORY
Operating
Landfill Operations 130,701 1,257,227 2,499,200 1,559,200 (940,000)
Yard Waste Collections 141,949 837,169 1,353,100 1,353,100 -
Residential 111,496 689,156 1,207,000 1,207,000 -
Neighborhood Services 49,712 321,080 606,100 606,100 -
Administration 37,650 232,189 407,000 407,000 -
Non-Operating
Debt Service - 173,312 173,200 173,200 -
Transfers to Other Funds 38,016 266,116 456,200 456,200 --
Other 62,500 1,039,321 1,338,000 1,380,000 42,000
TOTAL EXPENSES _ 572,024 4,815,570 _ 8,039,800 _ 7,141,800 X898,000)
EXCESS(DEFICIT)REVENUES
OVER EXPENSES (23,803) (917,218) (1,451,800) (883,800) (568,000)
FUND BALANCE
Beginning Fund Balance 3,209,942 _ 4 ,357 4,103,357 2,773,803 1,329,554
Ending Fund Balance $. _ 3,186 139 __3186.139 2,65-1 1 890,003 761,554
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CITY OF BEAUMONT
HOTEL OCCUPANCY TAX FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 338,455 Accounts Payable $ —
Accounts Receivable 9,728 Accrued Wages Payable 17,120
17,120
Fund Balance,Unreserved 331,063
TOTAL AVAILABLE RESOURCES $ 348,183 TOTAL CLAIMS ON RESOURCES $ 348,183
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CRY OF BEAUMONT
HOTEL OCCUPANCY TAX FUND
STATEMENT OF REVENUES,EXPENDIT URES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date 04/.30/20.02 — Budget Budget
REVENUES _ ----
Hotel/Motel Tax $ 151,497 1,001,406 1,650,000 1,650,000 -
Interest Earrings 655 5,801 8,000 8,000 -
Miscellaneous Revenue _ 71 _ _ 646 1,000 1,000.
TOTAL REVENUES 152,223 1,007,853 1,659,000 1,659,000 -
EXPENDITURE CATEGORY
Convention and Visitors Bureau 59,007 406,185 903,500 903,500 -
Convention Facilities 41,472 255,435 548,700 548,700 -
Designated Programs 33,500 178,800 370,000 370,000 -
TOTAL EXPENDITURES 133,979 840,420 1,822,200 1,822,200 -
EXCESS REVENUES OVER
(UNDER)EXPENDITURES 18,244 167,433 (163,200) (163,200) -
FUND BALANCE
Beginning Fund Balance _ 312,819 _ 163,630 _ 163,630 _ 163,228 402
Ending Fund Balance $--_ 331,063 331-063 430 Z8 402
13
CITY OF BEAUMONT
STREET MAINTENANCE FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 1,178,387 Accounts Payable $ —
Utilities Receivable(Net) 198,440
Fund Balance
Reserved for Encumbrances 222,739
Reserved for Receivables 198,440
Unreserved 955,648
1,376,827
TOTAL AVAILABLE RESOURCES $ 1,376,827 TOTAL CLAIMS ON RESOURCES $ 1,376,827
14
CITY OF BEAUMONT
STREET MAINTENANCE FUND
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date 0413012002 Budget Budget
-- - - --
REVENUES
Charges for Services $ 122,035 847,249 1,450,000 1,450,000 -
Interest Earnings 2,773 26,927 _ 50,000 50,000 -
TOTAL REVENUES 1.24,808 874,176 1,500,000_ 1 500,000 -
EXPENDITURE CATEGORY
Street Rehabilitation 208,643 1,220,496 1,320,500 1,751,400 _ 430,900
TOTAL EXPENDITURES 208,643 1,220,496 1,320500_ 1,751,400 430,900
EXCESS REVENUES OVER
(UNDER)EXPENDITURES (83,835) (346,320) 179,500 (251,400) 430,900
FUND BALANCE
Beginning Fund Balance 1,460,662 1,723,147 1,723,147 251,475 1,471,672
Ending Fund Balance $ 1-175 1.,376.827. = 1,902 647.. 75 1.902 572_
Note:Total expenditures include actual outstanding purchase orders and future purchase orders necessary for
completion of projects. Actual purchase orders as of April 30, 2002 were$222,739.
15
CITY OF BEAUMONT
MUNICIPAL TRANSIT FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ — Accounts Payable $ —
Due from Other Governments 1,161,540 Due to Other Funds 751,404
751,404
Fund Balance
Fund Balance, Unreserved (379,179)
Equity in Bmt Municipal Transit Co. 186,769
Reserved for Encumbrances 602,546
410,136
TOTAL AVAILABLE RESOURCES $ 1,161,540 TOTAL CLAIMS ON RESOURCES $ 1,161,540
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CITY OF BEAUMONT
MUNICIPAL TRANSIT FUND
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
(Unfavorable)
FYE 2002 Year-End
Current Actual Projected at To
Month Year To Date 0.4_/30/02 Budget_ _ Budget
REVENUES
Service Charges $ 48,983 369,584 817,800 817,800 —
Intergovernmental Revenue 112,219 1,365,636 2,938,600 2,938,600 —
Interest — 79 — — —
Miscellaneous Revenue 1,550 13,350 30,000 30,000 —
Transfer from General Fund 85,000 595,000 1,020,000 1,020,000 —
TOTAL REVENUES 247,752 2,343,649 4,806,400 4,806,400 —
EXPENDITURE CATEGORY
Contract Services 274,970 2,064,479 3,240,000 3,240,000
Capital Improvements — — 1,578,600 1,578,600 —
TOTAL EXPENDITURES 274,970 2,064,479 4,818,600 4,818,600 —
EXCESS(DEFICIT)REVENUES
OVER EXPENDITURES (27,218) 279,170 (12,200) (12,200) —
FUND BALANCE
Beginning Fund Balance 437,354 130,966 209,151 209,151 (78,185)
Ending Fund Balance $ 410,136 410,136 196,951 _ 196,951 _ (78,185)
17
.... Z « 2
internal Service funds
CITY OF BEAUMONT
CAPITAL RESERVE FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 1,481,703 Accounts Payable $ 218,656
Receivables — Due to Other Funds 77
218,656
Fund Balance, Unreserved 1,263,047
TOTAL AVAILABLE RESOURCES $ 1,481,703. TOTAL CLAIMS ON RESOURCES $ 1.481.703
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
Month Year To Date
Cash Flow from Operating Activities _
Cash Received from Charges for Services $ 146,050 1,037,987
Cash Paid to Suppliers _L475) A36,7"
—145,575 601,193
Cash Flow from Capital and Related Financing Activities
Proceeds From Other Sources — —
Proceeds from Issuing Debt —
Principal Retirement and Interest Charges (167,310) (276,617)
Acquisition of Capital Assets _161,408 538,588
_ L28,718) (815,20
Cash Flow from Investing Activities
Interest Earnings 3,758 33,039
Net Cash Flow (79,385) (180,973)
CASH BALANCE
Beginning Cash Balance __1,561,088 1,662,676
Ending Cash Balance $14-81,703 1,481,703,
20
CITY OF BEAUMONT
CAPITAL RESERVE FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End To
_Month Year To Date 04130/2002 Budget Bu_d_get
REVENUES
Charges for Services $ 116,175 813,225 1,394,100 1,394,100 —
Interest Earnings 3,758 33,039 60,000 60,000 —
Transfers from Other Funds 29,875 209,125 358,500 358,500 —
Proceeds from Capital Leases — — — —
Miscellaneous Revenue — — 20,000 20,000 —
TOTAL REVENUES 149,808 1,055,389 1,832,600 1,8321600 —
EXPENSE CATEGORY
CapitalOutlay-Equipment 61,883 757,244 1,324,800 1,324,800 --
Capital Outlay-Critical Bldg 475 95,682 297,000 297,000 —
Debt Service 167,310 276,617 775,600 775,600 —
TOTAL EXPENSES 229,668 1,129,543 2,397,400 2,397,400 —
EXCESS(DEFICIT)REVENUES
OVER EXPENSES (79,860) (74,154) (564,800) (564,800) —
FUND BALANCE
Beginning Fund Balance 1,342,907 1,337,201 _ 1,337,201 1,171,380 _ 165,821
Ending Fund Balance $ 1.263.047 1,263 047- _ 772,401_ . 606580 165 821_
21
CITY OF BEAUMONT
FLEET FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES _ CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 405,195 Accounts Payable $ 54,555
Inventories 336,451 Accrued Wages Payable 41,916_
Other Receivables — _ 96,471
Fund Balance
Reserved for Inventories 336,451
Unreserved 308,724
645,175
TOTAL AVAILABLE RESOURCES $ 741.646 TOTAL CLAIMS ON RESOURCES $ 741 646.
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
Month Year To Date
Cash Flow from Operating Activities
Cash Received from Charges for Services $ 411,994 2,463,029
Cash Paid to Suppliers (228,215) (1,492,083)
Cash Paid to Employees —_ (92,95 —(661,9
90,854 308,947
Cash Flow from Capital and Related Financing Activities
Cash to(from)Other Funds (13,608) (95,258)
Acquisition of Capital Assets _____(342) L,303)
(13,950) _ (97,561
Cash Flow from Investing Activities
Interest Earnings 313 1,754
Net Cash Flow 77,217 213,140
CASH BALANCE
Beginning Cash Balance 327,978 192,055
Ending Cash Balance $__ 405.195 405 195_
22
CITY OF BEAUMONT
FLEET FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date _0.4/3.0/2_00.2 B_ udget _ Budget
REVENUES
Charges for Services $ 411,994 2,463,029 4,080,100 4,080,100 —
Interest Earnings 313 1,754 4,000 4,000 —
Miscellaneous Revenue — — — — —
TOTAL REVENUES 412,307 2,464,783 4,084,100 4,084,100 —
EXPENSE CATEGORY
Personnel Costs 92,925 661,999 1,195,100 1,195,100 —
Operating Expenses 257,875 1,480,072 2,794,600 2,794,600 —
Capital Outlay 342 2,392 4,100 4,100 —
Transfers Out 13,608 95,258 163,300 163,300 —
TOTAL EXPENSES 364,750 2,239,721 4,157,100 4,157,100
EXCESS(DEFICIT)REVENUES
OVER EXPENSES 47,557 225,062 (73,000) (73,000) —
FUND BALANCE
Beginning Fund Balance 597,618 _ 420,113 420,113 636,489 216,376
__1 6
Ending Fund Balance $ _645,175- _. (245,175 _ _ 347,113. 563 489. _(216.376J
23
CITY OF BEAUMONT
EMPLOYEE BENEFITS FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 1,717,016 Escheat Clearing $ 29,824
Receivables 125 Employee flex plan, suppl life&Rd 22,558
Accounts Payable 7
Accrued Wages Payable 16599
68,988
Fund Balance, Unreserved 1,648,153
TOTAL AVAILABLE RESOURCES $ 1,717,141 TOTAL CLAIMS ON RESOURCES $ 1,717,141
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
__Month Year To Date
Cash Flow from Operating Activities
Cash Received from Charges for Services $ 1,027,701 7,201,209
Cash Paid for Benefits&Services __i1,151,964) _ (7,232,1
(124,263) (30,896)
Cash Flow from Investing Activities
Interest Earnings —7,666 61,758
Net Cash Flow (116,597) 30,862
CASH BALANCE
Beginning Cash Balance 1,833,613 1,686,154
Ending Cash Balance $ 1,717,016 1,717,016
24
CITY OF BEAUMONT
EMPLOYEE BENEFITS FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date 04/301200_2_ _ Budget Budget
REVENUES
Interdepartmental Transfers
Employee Health Ins $ 300,257 2,102,906 3,603,600 3,603,600 -
Dependent Health Ins 468,666 3,283,091 5,641,800 5,641,800 -
Worker's Comp. 92,325 646,658 1,109,900 1,109,900 -
General 34,149 239,041 410,000 410,000 -
Employee Contributions 132,304 924,161 1,524,000 1,524,000 -
Miscellaneous Revenue - 5,352 - - -
Interest Earnings 7,666 60,295 90,000 90,000 -
TOTAL REVENUES 1,035,367 7,261,504 12,379,300 12,379,300 -
EXPENSE CATEGORY
Health
Point-of-Service 582,778 2,977,762 5,011,000 5,011,000 -
HMO Blue Texas 253,476 1,658,278 2,900,000 3,350,000 450,000
Dental 56,301 368,848 617,000 617,000 -
Health Prescriptions 161,708 1,099,547 1,750,000 1,750,000 -
Other Benefits 6,294 44,026 95,000 95,000 -
Total 1,060,557 6,148,461 10,373,000 _ 10,823,000 450,000
Worker's Compensation
Third Party Admin. 5,373 45,810 91,000 91,000 -
Claims Paid 39,488 597,278 950,000 900,000 (50,000)
Safety Management 7,033 76,824 129,200 129,200 -
Excess Insurance - 25,414 25,000 25,000 -
Total 51,894_ 745,326 _1,195,200 _ 1,145,200 (50,0
General
Unemployment 12,045 24,357 60,000 60,000 -
Short-term Disability 27,699 _ 293,073 350,000 - 350,000 - _ _-
Total - 39,744 317,430 -410,000 - 410,000 -
TOTAL EXPENSES - 1,152,195 7,211,217 11,978,200 12,378,200 400,000
EXCESS(DEFICIT)REVENUES
OVER EXPENSES (116,828) 50,287 401,100 1,100 400,000
FUND BALANCE
Beginning Fund Balance 1,764,981 1,597,866 1,597,866 928,102 669,764
Ending Fund Balance $ 1648,153 164$153 1.998,966 = _929.202_ = 1 069 764
25
CITY OF BEAUMONT
GENERAL LIABILITY INSURANCE FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 900,145 Accounts Payable $ 586
_ 586
Fund Balance
Reserved for Claims 899,559
Unreserved —
899,559
TOTAL AVAILABLE RESOURCES $.,__ ._900.145 TOTAL CLAIMS ON RESOURCES $__ 900.145
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
Month Year To Date
Cash Flow from Operating Activities
Cash Received from Charges for Services $ 33,333 233,333
Cash Paid for Claims _ (6,293) (627,937)
27,040 (394,604)
Cash Flow from Investing Activities
Interest Earnings 2,047 20,309
Net Cash Flow 29,087 (374,295)
CASH BALANCE
Beginning Cash Balance 871,058 1,274,440
Ending Cash Balance $. KO-145 900,145
26
CITY OF BEAUMONT
GENERAL LIABILITY INSURANCE FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date _04/3_0/2002 Budget Budget
REVENUES
Interest Earrings $ 2,047 19,619 40,000 60,000 (20,000)
Interdepartmental Transfers 33,333 233,333 400,000 400,000 —
Miscellaneous Revenue — — — — —
TOTAL REVENUES 35,380 252,952 440,000 460,000 (20,000)
EXPENSE CATEGORY
Professional Services 322 24,053 100,000 100,000 —
Settlements 6,557 584,262 700,000 700,000 —
Other Insurance — 3,420 4,000 4,000 —
TOTAL EXPENSES 6,879 611,735 804,000 804,000 —
EXCESS(DEFICIT)REVENUES
OVER EXPENSES 28,501 (358,783) (364,000) (344,000) (20,000)
FUND BALANCE
Beginning Fund Balance 871,058 1,25342 1,258,342 1,272,987 X4645)
Ending Fund Balance $ _ 899,559. _ 899 559.. —_894 342 928,987 3C645)
27
-1
--Nt,
Capital Trojects funds
CITY OF BEAUMONT
GENERAL IMPROVEMENT FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 184,210 Accounts Payable $ 950
Receivables 500
950
Fund Balance
Reserved for Park Improvements 575,000
Reserved for Construction (543,533)
Reserved for Encumbrances 152,293
183,760
TOTAL AVAILABLE RESOURCES $ 184,710 TOTAL CLAIMS ON RESOURCES $ 184,710
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
per General Ledger
Actual
To Date
Revenues $ 374,335
Expenditures 632,2_2_3
Excess(Deficit)Revenues
Over Expenditures (257,888)
Fund Balance
Beginning Fund Balance 441,648
Ending Fund Balance $ 183,760
FUNDING SUMMARY
April 30,2002
Project
Balance
Funds Available(On Hand/Receivable) $ 183,760
UPARR Funding Provided 200,000
TPW Funding Provided 25,000
Grant Funding Provided 1,052,123
Available from Miller Trust 365,133
Reserved for Parts Improvements(Central Pk) (575,000)
Required future 540,326
Total $ 1,791,342
30
CITY OF BEAUMONT
GENERAL IMPROVEMENT FUND
PROJECT EXPENDITURE REPORT
April 30,2002
Current
Project Expended Project
Budget To Date Balance(1)
EXPENDITURES
Playground Renovations 400,000 274,664 125,336
McLean Park 100,000 625 99,375
Roberts Paris 150,000 625 149,375
Theodore R. Johns Library 1,950,000 1,625,068 324,932
Charlton Pollard Park 1,103,900 376,709 727,191
Miller Library Expansion 800,000 434,867 365,133
TOTAL EXPENDITURES $ 4,503,900 2,712,558 1,791,342
(1) Total project balance includes actual outstanding purchase orders and future purchase orders necessary for completion of
projects. Actual purchase orders as of April 30,2002 were$152,293.
Project Highlights
Renovation of existing playgrounds at Alice Keith, Chaison and Gilbert Parks. Original CIP budget
was$300,000.
Renovations of existing playgrounds at McLean and Roberts Parks with partial funding from UPARR and TPW.
Construction of Theodore R.Johns Branch Library with funding from CDBG, Section 108.
Construction of a park in the Charlton Pollard neighborhood,with other funding from CDBG.
Expansion of Miller Library with proceeds from the Miller Trust.
31
CITY OF BEAUMONT
STREETS AND DRAINAGE IMPROVEMENTS
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash 3,621,912 Accounts Payable $ —
Receivables 495,788
Fund Balance
Reserved for Construction 268,373
Reserved for Encumbrances 3,849,327
4,117,700
TOTAL AVAILABLE RESOURCES $ 4,117,700 TOTAL CLAIMS ON RESOURCES $ 4,117,700
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
per General Ledger
Actual
_ To Date
Revenues 425,049
Expenditures 3,732,456
Excess(Deficit)Revenues
Over Expenditures (3,307,407)
Fund Balance
Beginning Fund Balance 7,425,107
Ending Fund Balance $ 4,117,700
FUNDING SUMMARY
April 30,2002
Project
Balance
Funds Available(On Hand/Receivable) $ 4,117,700
Available from TxDOT 3,906,436
Available from TIFF _
Required(Future) 1,626,703
Total $ 9,650,839
32
City of Beaumont
STREETS AND DRAINAGE IMPROVEMENTS
PROJECT EXPENDITURE REPORT
April 30,2002
Current
Project Expended Project
Budget To Date Balance(1)
EXPENDITURES
Major Dr(Hwy 105 to Hwy 124) 4,000,000 1,741,482 2,258,518
Concord II(Helena St.to RR) 9,150,000 6,811,126 2,338,874
Concord III(RR to East Lucas) 5,310,000 4,259,987 1,050,013
Neches River Hike&Bike Trail 3,400,000 376,445 3,023,555
Walden Road 6,569,100 6,543,616 25,484
Downtown Improvements 1,500,000 545,605 954,395
TOTAL EXPENDITURES $ 29,929,100 20,278,261 .9,650,839
(1) Total project balance includes actual outstanding purchase orders and future purchase orders necessary for completion of
projects. Actual purchase orders as of April 30,2002 were$3,849,327.
Project Highlights
Relocation of utilities and purchase of rights-0f--way on Major Dr from College to Hwy 124. The citys portion is
estimated at$800,000;the state will reimburse other costs up to total project cost of$4M.
Engineering, land acquisition and construction costs for the widening of Concord Road from I1-110 to Hwy 105.
Construction of a Hike and Bike Trail from Riverfront Park to Collier's Ferry Park. The City's portion is estimated
at$900,000;the state will reimburse other costs up to the total grant amount of$2.4M.
Engineering and construction costs for the paving and drainage improvements on Walden Road from
Hwy 124 to Major Dr.
Improvements to downtown streets and sidewalks in conjunction with the Crockett Street Entertainment Complex,
with funding from TIFF estimated at$500,000.
33
CITY OF BEAUMONT
WATER UTILITIES IMPROVEMENT FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 4,005,643 Accounts Payable $ 459,700
Receivables – Due to Other Funds --
4_5_9,_700_
Fund Balance
Reserved for Construction (12,502,814)
Reserved for Encumbrances 16,048,757
- 3,545,943
TOTAL AVAILABLE RESOURCES $ 4,005,643. TOTAL CLAIMS ON RESOURCES $ 4 005,643.
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
per General Ledger
Actual
To Date
Revenues $ –
Expenses 13,796,286
Excess(Deficit)Revenues
Over Expenses (13,796,286)
Fund Balance
Beginning Fund Balance 17,342,229
Ending Fund Balance $---3.W-943.
FUNDING SUMMARY
April 30,2002
Project
Balance _
Balance to Complete Existing Projects $ 41,273,939
Funds Available(On Hand/Receivable) 3,5451943
Funds Required to Complete Existing Projects $ 727,996
34
CITY OF BEAUMONT
WATER UTILITIES IMPROVEMENT FUND
PROJECT EXPENSE REPORT
April 30,2002
Project Expended Project
Estimate To Date Balance
EXPENSES
Construction Projects
Water Supply Study Phase II $ 1,831,450 1,239,525 591,925
Prison Sewer Force Main 1,460,500 1,390,692 69,808
Water Line Replacement 3,000,000 990,135 2,009,865
Dowlen Rd Sewer Int Rehab 2,771,600 1,790,779 980,821
11th St Sewer Int Rehab 2,758,500 912,678 1,845,822
Gmd Storage Tank-Pine St 7,828,500 3,762,500 4,066,000
Water Meter Relocation 900,000 193,924 706,076
Entertainment Complex 365,000 292,408 72,592
Sewage Treatment Plant 2,720,000 441,778 2,278,222
Tyrrell Park Rd Sewer Int 1,007,900 812,419 195,481
Langham Facility Improv 700,000 652,006 47,994
Loeb Water Tank Rehab 646,100 265,303 380,797
Lawson Raw Water Line 4,000,000 2,656,852 1,343,148
Lawson Pump Station 3,700,000 1,206,678 2,493,322
Water Plant Expansion 14,000,000 209,931 13,790,069
Digester Conversion 1,400,000 251,250 1,148,750
Lawson Rd/Bank Stabilization 1,395,000 558,976 836,024
E Lucas Sewer Interceptor 2,950,000 69,959 2,880,041
Central Trunk Line 5,500,000 _ 44,732 _5,455,268
Total Construction 58,934,550 17,742,525 _41,192,025
Line Relocations
Concord Rd Phase II 780,500 736,172 44,328
Concord Rd Phase III 206,000 168,414 37,586
Total Relocations _ _986,500 _ 904,586 __ 81,914
TOTAL EXPENSES $ 59,921.050 18.647.111_ -41 Z73,939
Water Supply Study Phase q is for the construction of a 5-million gallon clearwell and high service/backwash pump
station at the water treatment plant and improvements to the Lawson's canal pipeline and pump station.
The Prison Sewer Force Main,constructed in 1990, has reached its maximum carrying capacity. An additional force
main is needed to provide service to the prison complex. This initial estimate is for the design phase.
The Water Line Replacement project will replace city wide water tines that are in very poor condition.
The Dowlen Rd&11th St Sewer Int Rehab projects will restore the structural integrity of the interceptors and capture the
lost carrying capacity. These projects will also reduce the bad at the sewage treatment plant by reducing inflow.
The Pine St Ground Storage Tank project is for the demolition and rebuilding of the ground storage water tank at the
water production plant on Pine St.
The Water Meter Relocation project is for Phase I of the relocation of alley meters to street r.o.w.'s.
The Entertainment Complex project involves extensions of water mains to support the SETEX Entertainment Complex.
The Sewage Treatment Plant improvements are for the replacement of the electrical and control systems.
The Tyrrell Park Rd Sewer Int Rehab project will rehabilitate the interceptor and replace manholes.
The Langham Facility improvements are for the replacement of the roof on the main bldg,conversion of the parking shed
into a machine shop,expansion of the parking lot,and additional storage area for materials and equipment.
The Loeb Tank Rehab project provides for repairing and repainting the interior of the steel water storage tank.
Line Relocations consist of water and sewer line relocations due to the Concord Rd street widening project
Lawson Raw Water Line Phase I consists of installing 12,000 LF of 48"pipe to deliver water from L.awson's pump
station to the water treatment plant.
The Lawson Pump Station upgrade will increase delivery to 40 million gallons per day to the water treatment plant
The Water Plant Expansion project will add 14 mgd additional capacity to the water treatment plant
The Digester Conversion project will convert two anaerobic digesters to the aerobic system
The Lawson Rd project will repair the road leading to the pump station and stabilize the river bank. $1 m funded by MRCS.
The E Lucas sewer interceptor will be rehabilitated. it was constructed in 1953.
The Central Trunk 54"diamater line will be rehabilitated. It was constructed in 1954.
35
U
. �. . . \/ �
,\ 4
2 ` p
OCash & investments O
CITY OF BEAUMONT
STATEMENT OF CASH POSITION
April 30,2002
Current Prior Increase/
Year Year (Decrease)
Balance' Balance' FY 2001-2002
BALANCES CLASSIFIED BY FUND
General Fund 16,487,469 16,409,185 78,284
Hotel Occupancy Tax Fund 338,455 362,114 (23,659)
Municipal Airport Fund 13,429 38,686 (25,257)
Texas Motor Carrier Violation Fund 16,755 15,467 1,288
Municipal Court Security Fund 102,177 66,269 35,908
Municipal Court Tech Fund 273,535 162,360 111,175
Miscellaneous Grant Fund 5,240 (18,716) 23,956
ISTEA Grant Fund - - -
Police Grant Fund (140,047) (207,033) 66,986
Tax Increment Financing Fund (56,498) 350,926 (407,424)
Health Grants Fund (199,495) (149,703) (49,792)
C.D.B.G. Program Fund 70,070 (16,726) 86,796
Shelter Plus Care Grant Fund (9,097) (1,845) (7,252)
Emergency Shelter Grant Fund - (45,595) 45,595
Home Fund (100,809) (78,835) (21,974)
Revolving Loan Fund 154,627 126,455 28,172
Rental Rehab Fund 884 173,472 (172,588)
Library Grants 11,848 (16,106) 27,954
HUD Sec 108 Loan Fund 3,471,339 6,745,720 (3,274,381)
Confiscated Goods Fund 1,039,049 1,508,970 (469,921)
Local Law Enforcement Bg Fund 526,163 622,964 (96,801)
Weed&Seed Fund (8,963) (69,765) 60,802
Street Maintenance Fund 1,178,387 1,960,122 (781,735)
Fire Training Grounds Fund (46,565) 4,371 (50,936)
Transit Fund (751,404) (752,312) 908
Debt Service Fund 3,834,983 3,565,199 269,784
Water Utilities Fund 4,388,530 5,295,111 (906,581)
Solid Waste Fund 2,677,335 3,852,153 (1,174,818)
General Improvements Fund 184,210 235,292 (51,082)
Street and Drainage Improvement Fund 3,621,912 1,927,980 1,693,932
Water Utilities Improvement Fund 4,005,643 21,080,705 (17,075,062)
Capital Reserve fund 1,481,703 767,159 714,544
Fleet Maintenance Fund 405,194 362,217 42,977
Employee Benefits Fund 1,717,016 1,815,601 (98,585)
General Liability Fund 900,145 1,272,736 (372,591)
'Reflects general ledger(book)balances and may differ from investment report due to uncollected items or items in transit.
(continued)
38
CITY OF BEAUMONT
STATEMENT OF CASH POSITION
April 30,2002
(continued)
Current Prior Increase/
Year Year (Decrease)
Balance" Balance' FY 1999-2000
BALANCES CLASSIFIED BY FUND Julie Rogers Trust Fund 222,372 213,969 8,403
Tyrrell Historical Trust Fund 22,407 21,560 847
Expendable Trust Fund 176,704 187,289 (10,585)
Library Trust Fund 121,250 114,484 6,766
Library Endowment Trust Fund 24,630 24,679 (49)
Payroll Fund 526,581 505,449 21,132
Historical Fire Museum Trust Fund 8,735 9,605 (870)
TOTAL ALL FUNDS 46,695,899 68,441,633 (21,745,734)
BALANCES CLASSIFIED BY FINANCIAL INSTITUTION
Petty Cash 13,067 12,717 350
Wells Fargo — — —
Hibernia National Bank 574,533 4,411,967 (3,837,434)
TOTAL CASH 587,600 4,424,684 (3,837,084)
Texpool 4,197,980 21,021,491 (16,823,511)
Logic Investment Pool 11,317,799 4,018,547 7,299,252
TexasTERM Investment Pool — 6,000,000 (6,000,000)
Fidelity Treasury Money Market Fund 3,471,278 6,878,737 (3,407,459)
Agency Securities (book value) 24,121,814 6,101,146 18,020,668
U.S. Treasury Bills (book value) — — —
U.S. Treasury Notes (book value) 2,999,428 19,997,028 (16,997,600)
TOTAL INVESTMENTS 46,108,299 64,016,949 (17,908,650)
TOTAL CASH AND INVESTMENTS 46,695,899 _ 68,441,633 _ (21,745,734
'Reflects general ledger(book)balances and may differ from investment report due to uncollected items or items in transit.
(concluded)
39
CITY OF BEAUMONT
SCHEDULE OF INVESTMENT POSITION
April 30,2002
Face Principal Book Unrealized
Amount Invested Value Earnings
CONSOLIDATED INVESTMENTS
U.S.Treasury Notes 3,000,000 2,998,594 2,999,428 17,608
Agency Securities 24,000,000 24,213,220 24,121,814 198,681
Overnight Investments•
Hibernia National Bank 1,151,049 1,151,049 1,151,049 62
Logic Investment Pool 10,888,486 10,888,486 10,888,486 566
TexPool 3,295,203 3,295,203 3,295,203 166
42,334,738 42,546,552 42,455,980 217,083
RESTRICTED INVESTMENTS•'
Overnight Investments'
Hibernia National Bank 878,559 878,559 878,559 47
Logic Investment Pool 429,313 429,313 429,313 22
TexPool 902,777 902,777 902,777 45
Fidelity Treasury M M Fund 3,471,278 3,471,278 3,471,278 4,235
5,681,927 5,681,927 5,681,927 4,349
48,016,665 48,228,479 48,137,907 221,432
' Reflects collected balances at month end. Will vary slightly from general ledger balances due to items in transit.
Includes Debt Service Fund, and Prior Lien Interest 8 Sinking Fund.
40
CITY OF BEAUMONT
SUMMARY OF INVESTMENT POSITION AND INTEREST INCOME
April 30,2002
INVESTMENTS BY TYPE Face
Amount Percentage
U.S.Treasury Notes 3,000,000 6.25%
Money Market Funds and Pools 18,987,057 39.54%
Agency Securities 24,000,000 49.98%
Bank Deposits 2,029,608 4.23%
48,016,665 100.00%
Current Year Prior Year
Weighted Average Yield of Portfolio 2.786% 5.357%
Weighted Average Maturity of Portfolio 247 95
INVESTMENT MATURITY SCHEDULE Face
Amo-unt. Percentage
Less Than 3 Months 23,016,665 47.93%
3 Months To 6 Months 0 0.00%
6 Months To 9 Months 2,000,000 4.17%
9 Months To 12 Months 6,000,000 12.50%
1 Year to 2 Years 17,000,000 35.40%
48,016,665 100.00%
INTEREST INCOME Increase/
- Current Prior (Decrease)
Year Year FY 2001-2002
Total Unrealized Earnings 221,432 476,795 (255,363)
Realized Interest Income _ _771,898 — 1,819,213 (1,047,315)
Total Earnings 993,330 2,296,008 1,302,67�
41
CITY OF BEAUMONT
SCHEDULE OF PURCHASES,SALES AND MATURITIES
April 30,2002
SCHEDULE OF PURCHASES
Purchase Face Principal
Date Description Amount Invested
04/01/2002 Logic 04/30/2002 3,500,000 3,500,000
3,500,000 3,500,000
SCHEDULE OF SALES AND MATURITIES
Purchase Face Principal
Date Description Amount Invested Sale Price
01/25/2001 FHLMC 04116/2002 2,000,000 2,037,756 2,000,000
04/01/2002 Texpool 04/30/2002 3,000,000 3,000,000 3,000,000
04/01/2002 Logic 04/30/2002 1,000,000 1,000,000 1,000,000
6,000,000 6,037,756 6,000,000
Summery Of.S—a e�-And Maturities YearT"aW
Current Year Prior Year
Average Holding Period Yield 6.006% 5.877%
Market Gain/(Loss) _ _
42
CITY OF BEAUMONT
SCHEDULE OF COLLATERAL
April 30,2002
Face Market Total
Description Amount Value_ Investments'
HIBERNIA NATIONAL BANK
FHLMC 6.500 03/01/14 CUSIP#31294JV47 3,011,536 3,020,917
FNMA 6.49411/01/28 CUSIP#31382LPL4 621,977 611,582
FNMA 6.500 08/15/04 CUSIP#31359MEX7 1,000,000 1,061,563
FDIC _ 100,000 100,000
4,733,513 4,794,062 2,236,299
' Reflects ledger balances at month end for the purpose of evaluating pledged collateral.
43
COMPARATIVE FINANCIAL ANALYSIS
Total Revenues
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Fund Balance
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N 1999 2000 112001 0 2002
Fiscal Year End Fund Balance
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DEBT SERVICE FUND
Fund Balance
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m 2002 2003 2004 2005 2006
a Fiscal Year
The financial policies indicate 20% of debt service requirements as an adequate level
of fund balance reserves. The level estimated for fiscal year end 2002 is 18.5%. This
is projected to decrease to 17.1% in FY 2003.
The amount required to elevate the fund balance to the 20% policy level is approximately
$380,000 which is equal to one cent of property tax.
The implementation of the administration's Stormwater Utility proposal would create the
capacity in the General Fund to shift a portion of the dedicated tax rate from the General
Fund to the Debt Service Fund.
Assumptions from the Long Range Financial Plan used in this presentation:
Issue $9M in Certificates of Obligation late FY 2002
Assessed value (AV) growth of 3% in FY 2003
Issue $8M in Certificates of Obligation late FY 2003
Assessed value growth of 2.5% in FY 2004 through FY 2006
HUD SECTION 108 PROJECTS
STATUS OF SECTION 108 PROJECTS
In 1998, the City of Beaumont received approval of Section 108 funding in the amount of
$11,000,000 from the Department of Housing and Urban Development. The Section 108 Program
is a loan guarantee provision of the Community Development Block Grant (CDBG) Program
whereby municipalities can borrow up to five times their annual CDBG allocation. The$11,000,000
loan will be repaid by the City and project developers over a 20-year period.
Crockett Street- The Beaumont City Council approved a Section 108 loan for the Crockett Street
project in the amount of $3,000,000 in August, 1998. The total project cost is estimated at
$10,000,000. The project is the redevelopment ofthe"Dixie Street"commercial block in downtown
Beaumont. .The developers plan to redevelop the two-story historic storefront buildings into a
combination of entertainment, eating, and drinking establishments. Approximately 300 permanent
jobs would be created upon completion of the project. Four(4) of the eleven(11) planned venues
are currently open.
Hotel Beaumont Retirement Home - The Council approved a request from the National
Development Council(NDC) for Section 108 funding in the amount of$3.175 million($2.0 million
loan and $1.175 million grant) in December, 1998. The NDC has completely renovated the Hotel
Beaumont, located at 625 Orleans Street. The total project cost was $7,495,000. The project is
100% complete.
Jefferson Theatre- Council approved Section 108 funding in the amount of$2,000,000 (grant) in
September, 1998. The Theatre will be restored as close as possible to its original design. In 1996,
a concentrated effort was initiated to mobilize over 150 civic leaders and area citizens to undertake
a comprehensive planning process and capital campaign with a goal of raising$3,000,000 in addition
to the $2,000,000 grant from the City. Construction should commence in June, 2002 after final
survey and title work is completed.
Theodore R.Johns, Sr.Branch Library-Council approved Section 108 funding in the amount of
$1,825,000 for the construction ofa new library,the Theodore R.Johns,Sr. Branch. The new library
will replace an outdated facility,the Spindletop Branch,currently serving the south end of Beaumont.
The building will be approximately 12,000 square feet on a five-acre site at the intersection of State
Highway 124 (Fannett Road) and Sarah Street. The Theodore R. Johns, Sr. Library will open on
June 6, 2002.
L.L. Melton YMCA - Council approved Section 108 funding in the amount of$1,000,000 (grant)
for the renovation of the L.L. Melton YMCA and the construction of new facilities. The Melton has
also received an Economic Development Initiative(EDI) from Congress in the amount of$500,000
to assist in the development of the project. The City Council will have a work session in June to
discuss a proposal from the National YMCA.
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Good News/Bad News
FY 2002
Good News
• Industrial Payments Exceed Budget FY 2002
• Higher than Expected Fund Balance
• Personnel Cost Savings
• Building Permits Growth
• Increased Employee Safety - Containing Worker's Compensation Costs
• Fire Training Center Progress Report
Bad News
O Industrial Payments FY 2003
O Proposed Expansion of Sales Tax Holiday
O Rising Cost of Property Insurance
O Appraised Values Lower than Expected
O Sales Tax Receipts
O Increased Transit Operating Costs
GOOD NEWS
Industrial Payments Exceed Budget FY 2002
In addition to renegotiated industrial district contracts,several new companies entered into
agreements with the City. These new contracts brought in approximately$400,000 in new
revenue. Additionally, in consideration for de-annexing a piece of property near their
facility,the ExxonMobil agreement was negotiated at a lower percentage for the first years
of the agreement and included an additional one time payment of approximately$280,000
in FY 2002.
Higher than Expected Fund Balance
Although not a significant increase, the FY 2002 beginning fund balance was $241,000
higher than budgeted projections. No one category significantly contributed to this
increase, however it did include$65,000 in FEMA reimbursements related to tropical storm
Allison. This, combined with the industrial payment windfall received in FY 2002, has the
projected year end fund balance equal to 9.1% of expenditures rather than the 8% level
originally budgeted. Financial policies dictate 8 - 10% as an adequate level of Fund
Balance.
Personnel Cost Savings
Reflecting the efforts of the past three fiscal years, the administration is continuing its
commitment (as attrition allows) to eliminate under-utilized positions from the budget.
Since a substantial number of reductions were made in these prior years, a smaller budget
impact will be realized in FY 2002.
As positions are cut, the tasks assigned to those jobs are distributed among other
employees. In those instances where job reclassifications are not warranted, the persons
assigned those additional duties are considered for a pay increase commensurate with the
amount of work and added responsibility that they assume.
In addition to salary savings from eliminating jobs, the cost of benefits is also saved. The
person assuming additional duties is already a participant in the City's benefits program,
therefore the City is able to save on average 30% of the salary amount for each position
eliminated.
Fiscal year to date a total of eight positions have been designated as "Will Not Be Filled"
in the General Fund for a total savings amount of $303,000. Eliminating these under-
utilized positions minimized the budgetary impact resulting from the two additional
positions required to staff the new Johns Branch Library.The net effect of these personnel
modifications was a savings of$233,300. In the Hotel Occupancy Tax Fund for FY 2002
one position was eliminated and one added for a net cost of$10,800.
Since July 1999 the administration has eliminated 42 under-utilized positions with a value
of $1,981,500. These eliminations generated the capacity to add 44 positions which
included 10 paramedics (seven of which staffed a fifth ambulance unit)and a construction
management team of 10 to oversee the $55M water system rehabilitation program
currently underway. The net savings across all funds related to these personnel
adjustments is $529,300 with $512,600 being in the General Fund.
Building Permits Growth
In October 1999, the building, electrical, plumbing, gas and mechanical permit fees were
increased to reflect the fee schedule in Appendix"B"of the 1997 Standard Building Code.
The new permit fee schedule became effective on December 1, 1999. The Fiscal Year
2001 anticipated revenue from permit fees was $671,000. Actual revenue from building
related permit fees in Fiscal Year 2001 was $925,170.
The total anticipated revenue in Fiscal Year 2002 from building related permit fees were
estimated at $807,000. With fifty-eight (58) percent of the fiscal year complete,
approximately$669,650 in revenue has been generated from building related permit fees.
It is anticipated that the total amount of revenue generated from building related permit
fees for Fiscal Year 2002 will total $1,144,000. This represents a forty-four (44) percent
increase in anticipated revenue. A breakdown by permit type reflecting the budgeted
revenue amount,the revenue to date and the year end revenue estimate is provided below
for Fiscal Year 2001 and Fiscal Year 2002.
Fiscal Year 2002 Bui ding Related Permit Revenue
Estimated Year
Permit Type Revenue Estimate Revenue to Date End Revenue
Building $300,000 $310,000 $530,000
Electrical 50,000 26,800 45,000
Plumbing 20,000 22,800 39,000
Gas 7,000 4,050 7,000
Mechanical 30,000 25,000 43,000
Other* 1 400,000 281,000 480,000
Totals $807,000 $669,650 $1,144,000
Fiscal Year 2001 Building Related Permit Revenue
Permit Type Revenue Estimate Year End Revenue
Building $250,000 $469,651
Electrical 55,000 37,797
Plumbing 30,000 28,445
Gas 6,000 7,548
Mechanical 30,000 28,249
Other* 300,000 1 353,480
Totals $671,000 $925,170
*Misc. Permits for Signs, Oil Wells, Fire Alarms, Sprinklers, Swimming Pools and
Driveways
Increased Employee Safety - Containing Worker's Compensation Costs
Based on Best Practices as reported in Workers Compensation and Human Resources
publications, an aggressive program which monitors the safety of the work environment,
trains and rewards employees; as well as actively seeks out the best care for injured
workers, serves as the most effective cost-containment program in which an organization
can invest.
In the past,the City's Safety Pays program rewarded departments whose employees have
achieved an inordinate number of work weeks without an accident and/or individuals who
demonstrate success from a new personal health regime. Beginning in January, 2002, a
new program was initiated to reward individual and team efforts to improve health and
safety. This program, called the "Goodwill Games", has events that are scheduled
throughout the year. These activities include: health screens and meetings, golf, bowling,
basketball, billiards, board games(checkers, dominos, backgammon), volleyball, softball,
tennis, turkey shoot/archery tournament, aerobics marathon, table tennis, weight lifting,
bingo, and a fishing tournament.
As a self-insured municipality, the City is entitled to submit a notice of subrogation for any
settlement made with an injured City of Beaumont employee from a third party that is
responsible for the injuries. As in the past, during fiscal year 2002,the City is aggressively
seeking out opportunities to recoup a portion of its Worker's Compensation costs through
subrogation. A combination of subrogation efforts and refunds resulted in payments back
to the Workers' Compensation account in the amount of$146,295.
Fire Training Center Progress Report
FY 2002 is the second year of the Training Center's five year strategic action plan. The
goals for the facility included:
♦ addressing safety concerns at the BASF, Industrial Complex and Pressure Manifold
projects;
♦ avoiding potential environmental problems due to leaks at the Storage Tank project;
♦ classroom renovations at the Rescue and Sprinkler Systems projects;
♦ upgrading the flow capacity from the north sump to the separator system;
♦ refurbishing instructor sheds and piping on the south side of the fire field.
The secondary stairway at the BASF project was determined to be too steep posing a
tripping hazard. The stairway was rebuilt to conform to OSHA standards. A center railing
was installed on the Industrial Complex project to insure the safety of students entering
the project's stairways.A solution to the slipping hazards created by algae formation at the
Industrial Complex and Pressure Manifold projects has not been determined to date.
Leaks in the bottom of the Storage Tank project placed it out of service for environmental
reasons. Williams Fire and Hazard Control, Inc. adopted the Storage Tank project and
funded the$8,250 refurbishment of the tank bottom to correct the problem.The project was
placed back in service in March, 2002.
The old "Dome Room" was converted into a second classroom at the Rescue Project.
Improvements included correcting a water seepage problem into the room during periods
of heavy rain by installing a french drain, rebuilding the pea gravel rappelling pad, and
adding fresh paint, window coverings and audiovisual equipment. Other classroom
renovations include demolition of the systems cubicles in the Sprinkler building to convert
the space to an additional classroom.The demolition was completed in February, and with
available funding, renovations will begin this summer.
The addition of the BASF project last year has increased the water flow to the north sump.
To handle the additional flow, larger 6" sump pumps are being installed. The system will
be hard piped from the sump to the separator and will require upgraded electrical systems
to accommodate the larger pumps. A vault across the back road is being constructed and
installation of the pipe supports have been completed. The project is scheduled for
completion in June, 2002.
The instructor sheds and piping have been refurbished on the South side of the fire field.
Piping is being sandblasted and painted, and the Instructor Sheds have new metal roofs
and chalk boards. Piping is now color coded to indicate the type of fuel or water running
through the lines. Marking of the valving will occur this summer.
BAD NEWS
Industrial Payments FY 2003
Due to the one time payment received from ExxonMobil in FY 2002, industrial payments
are projected to decline by 2.62% or $322,000 in FY 2003. This assumption includes an
approximate increase in assessed value of 2% applied to all industries. Industries in
Beaumont, along with others across the United States, have felt the impact of a declining
economy that was exacerbated by the events of September 11, 2001. Administration
remains optimistic that these companies will hold steadfast during these trying times and
assessed values will not be adversely impacted.
Proposed Expansion of Sales Tax Holiday
The State of Texas is once again considering increasing the types of items exempt from
taxation and the number of days of the sales tax holiday. Although specific information is
not available relative to the amount of revenue lost during the holiday, an expansion of the
holiday is expected to have a negative impact on an already struggling revenue source.
Rising Cost of Property Insurance
A 150% increase in the premium for property insurance was not expected last budget year
but due to unexpected events during the past year, the City, like all other policyholders,
must bear the burden of increased premiums.
Nationwide increases in cost for insurance began in early 2001 because of a declining
stock market. In June 2001, Tropical Storm Allison caused extensive damage in the Gulf
Coast region and millions of dollars in insurance claims. The insurance market incurred
billion dollar losses after the destruction of the World Trade Center.All of these factors are
negatively affecting insurance rates for both the public and private sector.
Property insurance for City facilities includes fire,flood and windstorm protection.The total
building value is approximately $103,069,932. Deductibles were increased last year to
reduce cost and are currently $100,000 for fire and flood and $250,000 for windstorm.
The new policy, provided by the Texas Municipal League Intergovernmental Risk Pool, is
for a one year period that began May 1, 2002. The total cost is $359,009, an increase of
$217,460 from the previous year's policy.
Appraised Values Lower than Expected
Preliminary 2002 appraised values were received from the Chief Appraiser May 15, 2002.
Net appraised value after applying exemptions and abatements is $3,984,789,183. This
is an increase of 1.95% over the 2001 certified tax roll.
It is important to recognize that this is only a preliminary estimate. The appraisal records
will be reviewed by the appraisal review board and they will hear and determine all tax
payer protests on these values. Once the appraisal review board process is complete, the
final roll will be certified by July 25, 2002.A five year average shows the July 25'certified
roll, after disputes are resolved, is approximately 1% less that the preliminary value. If this
holds true for this tax year, the increase would be reduced to about 1%.
The Long Range Financial Plan projected an increase of 3% in appraised values. The
impact of the actual preliminary values to the General and Debt Service Funds will be a
reduction in projected revenue, including the allowance for disputed values, of
approximately $250,000 in each fund. Approximately $0.0131 of property tax would be
required to generate this additional $500,000 required in both funds. An FY 2003 penny
equals $380,000.
Sales Tax Receipts
As of May 2002 sales tax revenue received year to date is $15.8 which is $228,000 or
1.4% below budgeted levels. April and May collections were less than 1% higher than the
same periods last year and February and March were 1.4% and 8.5% below.
Administration is cautiously optimistic that future collections will be representative of the
economic growth being experienced throughout the City.
Increased Transit Operating Costs
Operating costs for the Beaumont Municipal Transit system have increased due to fuel
costs, age of the fleet and employee wages. The FY 2002 budget provided, through a
transfer from the General Fund, an operating subsidy of $767,500 as well as $250,000
for capital match. At the time the FY 2002 budget was prepared, the state subsidy was
estimated at $420,000, however the final contract amount was $525,000.
The budget reconciliation plan implemented in FY 2002 included reduced operating hours
in the form of longer mid-day head times and a fare increase of $0.25. The proposal to
recover costs through charges to social service agencies amounting to approximately
$100,000, has not been realized.
Revised projections indicate potential under-funding of approximately $100,000. This
deficit, if realized, would be recovered through an increased transfer from the General
Fund.
ALTERNATIVE COURSES OF ACTION
2002 BUDGET SUMMIT
FINANCIAL AND BUDGETARY CHALLENGES
In order to meet the increasing challenges of reduced or limited funding and increased citizen
expectations for service, the City is exploring ideas to reduce cost, generate revenue and increase
service quality.
It is important to match the taxes and fees that the public is willing to pay with the cost of services
that the public demands. The Administration's efforts to Rightsize,as opposed to downsize,a service
cost means having the right number of people with the right kind of skills and training, the right
amount of supplies and just the right amount of physical plant and equipment to provide the service
properly.
"If you downsize,you're cutting costs but you're not fixing
fundamental problems."
- W. Edwards Deming
Before any organization attempts to Rightsize its efforts, it should ask the following
questions:
• Does the activity fit the organization's strategic plan?
• Does the activity produce more value for the customer than it consumes in
resources?
• If not, why is the organization doing this?
Crucial to all downsizing or rightsizing efforts is deciding on what the organization does
well. Rational resource allocation simply means putting scarce resources to good use.
Government activity should produce more value than it consumes.
"Unless we change our direction, we are likely to end
up where we are headed."
-Old Chinese Proverb
To meet the financial challenges of FY2003, the City must consider changing the
fundamental way government operates. This process of change involves new directions -
• Empowerment of Neighborhoods in Decisions Allocating Resources
• Ensure Competition In Service Delivery
•
Government Focus on Mission/Values
• Results-Oriented Government — Funding Outcomes, Not Inputs
• Meeting the Needs of the Customer, Not the Government
• Creating Revenue Rather Than Spending Opportunities
• Anticipate — Focus on Prevention Rather Than Correction
• Increased Employee Participation and Teamwork
The City needs to move beyond the basic improvement of an existing process. What must
occur is a fundamental change to an existing process or eliminating it totally. Therefore,
Council and Administration must provide the necessary leadership if significant changes are
to be made to provide the most efficient and cost effective services to our customers.
A process to analyze service effectiveness provides Council with various policy options:
• Provide services differently or at a different service level
• Raise revenue (fees and/or taxes)
• Ask for understanding for a declining City and reduced service levels
An Administrative analysis of services and programs provides significant cost savings for the
long-term financial stability of the City by:
• Determining services to be eliminated
• Identifying subsidies to be reduced or discontinued
• Determining appropriate service levels focusing the organization on mission,
encouraging an entrepreneurial spirit throughout the organization
COMPETITIVE GOVERNMENT
INJECTING COMPETITION INTO SERVICE DELIVERY
• Most obvious advantage of competition is greater efficiency or more bang for the buck.
• Competition forces public or private monopolies to respond to the needs of their
customers.
• Competition rewards innovation; monopoly stifles it.
• Competition boosts the pride and morale of public employees.
• Competition must be carefully structured and managed, if it is to work...unregulated
markets generate inequity.
PRIVATIZATION TECHNIQUES
Service Shedding. A form of total privatization in which government stops providing a
service entirely.
Contacting Out. The City contracts with a private organization, for profit or nonprofit, to
provide a service.
Public-Private Competition. Public in-house units compete against private firms to provide
a public service.
Franchise. A private firm is given the exclusive right to provide a service within a certain
geographical area for a limited time.
Vouchers. Government provides individuals with certificates redeemable for purchase of
a good/service on the open market.
Subsidy. The producer of the service is subsidized by the government contributing
financially or in-kind to a private organization to reduce the cost of private provision of
service to consumers.
Internal Markets. Government departments are free to purchase services from either the
private sector or internal support units.
Asset Sale or Lease. Government sells assets such as airports, utilities or real estate to
private firms, thus turning physical capital into financial capital.
Volunteers. Volunteers are used to provide all or part of a government service.
Self-Help. Community groups and neighborhood organizations take over a service or
government asset such as a local park.
Private Infrastructure Development. The private sector builds, finances and/or operates
infrastructure such as roads and airports, recovering costs through user charges.
Deregulation. Government regulations are eliminated to allow private providers to compete
against a government provider; for example, allowing firms to compete with the U.S. Postal
Service.
The following are critical activities to support a process of financial renewal and
revitalization:
• Create a mission and shared vision of the community and organization.
• Embrace the primary values of the organization.
• Mayor/Council sets strategic goals and objectives.
• Mayor/Council sets priorities and eliminates programs that do not support the mission
of the City.
• An effort is made to reduce organizational layers as part of streamlining the
administration.
• All non-essential work that does not provide value to the customer is eliminated
through improving work processes.
• Implement a quality improvement/customer service perspective.
• Emphasize performance measures for all services areas.
• Explore alternative service delivery approaches.
• Create meaningful opportunities for citizen involvement.
• Communicate the results of the process to the organization employees and
community.
• Celebrate the success achieved!
ORGANIZATION GUIDELINES
• Is it the right thing for the community and organization?
• Is it the right thing for the department?
• Is it ethical and legal?
• Is it something you are willing to be accountable for?
• Is it consistent with the organization values and policies?
When the answers to all ofthe above questions are yes,the guidelines state"just do it"without asking
for permission or forming a committee to decide. This is direction that encourages employees to
think; and when employees think, they can respond with flexible, innovative solutions and services
for their customers.
The funding strategies to be utilized focus on the following areas:
• Preserve and enhance the capital improvements program and planning process.
• Commit to not substituting City funding for reductions in state or federal funding
programs.
• Reduce personnel positions by attrition when feasible.
• Identify best practices through benchmarking- search for best practices that lead to
performance;and become the standard against which the local government compares
itself.
• Survey citizens to understand demands and expectations for service.
• Emphasize user fees as opposed to increase in taxes.
• Maintain a reasonable fund balance.
• Develop productivity initiatives and gain-sharing with departments that are successful
in reducing costs while maintaining or increasing service quality.
• Initiate a trust fund to encourage and facilitate private sector donation.
• Institute an aggressive program to procure federal/state grants to address identified
priorities to the City.
"The only person who likes change is a wet baby."
-Roy Z.M.Bliurr
There are other important aspects to an improvement process that Mayor and Council need to
consider prior to a major commitment.
• To be successful,long-term financial forecasting and planning is essential. However,
unexpected and unpredictable events can and will occur to impact any forecast no
matter how well prepared.
• The Mayor, City Council and Administration need to commit to the process and its
potential outcome.
• A major improvement process can't be accomplished in one or two years.It is a long-
term commitment and a basic rethinking of the fundamental mission on how
government provides service.
• It is important to solicit community understanding and involvement as the process
proceeds into reducing or eliminating programs and reviewing fees for services.
• A commitment must be made to enhance volunteer programs and public/private
partnerships in order to maintain existing levels of priority services.
• A renewed commitment is necessary to education and training to lead and change the
organization.
• Sufficient time must be spent on communicating openly through focus groups, staff
meetings,public forums,citizen newsletters and other strategic sources ofinformation
that can be identified.
"There is nothing more difficult to take in hand,
more perilous to conduct... than to take the lead in
the introduction of a new order of things."
-Niccolo Machiavelli,"The Prince"
IDEAS THAT SAVE COSTS AND INCREASE REVENUE/SERVICE QUALITY
Mayor/Council and Administration are agents of change. Change requires a driving force
and the most powerful change agent is financial stress. The City of Beaumont must make
major changes in the operation of government if financial stability and quality services are
to be continued.
The implementation of a portfolio management tracking system to monitor
taxes, water, sewer and other City assessments will result in increased
revenues received in a more timely manner.
The City should aggressively sell assets - land, buildings, equipment to the
extent possible in order to turn underutilized physical capital into financial
capital and produce tax benefits.
Privatization of public services should be considered through a competitive
process with City employees when contracting provides a clear advantage
on cost savings and service quality. While the private sector can be an
effective agent for delivering public services, the responsibility for providing
services - determining the scope, level and conditions under which they are
delivered remains with City officials committed to the public interest.
Management improvement efforts many times focus on how to do unimportant
things cheaper. Instead, as City leaders we should ask- "should we be doing
this at all?" City government should limit activities to core functions and
missions. Does the City activity/service provide more value for the customer
than it consumes in resources? Is the service essential? Is the private sector
already providing the service or if not, is it capable of doing so better than
government? Does the program displace voluntary community or
neighborhood networks? This approach must be applied to all service areas
with the intent to eliminate activities that don't meet the criteria.
The City Council and City Manager meet quarterly with the Beaumont
Independent School District to discuss common issues and priorities. The
Council and Manager also meet quarterly with the Chamber of Commerce and
all Beaumont governmental entities for the same reason. Programs, services
and taxpayer facilities should be identified for better coordination and use.
For example, the City and BISD could expand use of joint facilities for
recreational programs.
Institute energy management program through public/private partnership to
retrofit City facilities with capital costs paid from energy savings over time.
Develop Government business opportunities to market products or services to
other public agencies, e.g. the "webber" back-flow device for toilets.
Solicit private sponsorship of public facilities such as the Civic Center.
Proposals would be solicited from the business community for naming rights
for an annual fee for a 20 year term.
Use of Fund Balance to address revenue shortfalls or unexpected expenses.
This is a short term solution that has negative consequences long term if the
fund balance is depleted.
Establish an employee incentive program to enhance morale,productivity and
cost savings. The program will provide monetary incentives to employees
exceeding departmental goals and budget targets. The program is based on the
following:
Incentive is based on performance measures through budgetary savings
Incentive is not related to performance evaluation system
It is department and program based not individual based
Each department has a mission statement and performance measures;
incentive comes if the department meets performance measures;partial
accomplishments are recognized as well
Capital outlays/improvements, insurance and professional fees are not
included
50% of savings is returned to general fund, 50% is shared equally
among employees generating the savings.
Reduction in number of Fleet vehicles.
Outsourcing City Internal Services.
Elimination/Transfer of Service Responsibility.
Adjust Service Levels.
Discontinue or Reduce Subsidy of Programs/Services.
Subsidize Transfer of Service.
Encourage Volunteer/Non-Profit Participation in Service Delivery.
Private Infrastructure Development.
Establish Trust Opportunities for Private Donations.
Improve Effectiveness of Collection Process of City Fees.
ENGAGING CITIZENS IN THE BUDGET PROCESS
Why should a city market their budget?
• The annual budget process is an opportunity to dialogue with citizens regarding
community goals and priorities and to create public support.
How can the City involve the community in the budget process?
• Neighborhood meetings
• Citizen survey (PAFR distribution)
• Website
• Newsletter (water bill distribution)
• Channel 4 (local government access)
Relying on the public hearing process is in most cases "too little, too late" to involve a
significant number of participants. It is desirable to inform and educate the public so that
they might understand the "budget process" but this is often "one-way," not two-way
communication.
Focus of Public Discourse
Informing Citizens Engaging Citizens
One-Way Two-Way
Telling/Selling Listening/Responding/Listening
Education Learning
Presenting Information Eliciting values,hopes, aspirations,
concerns
Discerning"Public Opinion" Promoting"Public Judgement"
Citizen Participation
FY 2003 Budget
Jun 10 Budget Summit
Aug 8 * Financial Improvement Team
Aug 13 Submission to Council of Proposed Budget
Aug 14 * Ward III - Martin Luther King Middle School
Aug 19 '` Ward I - MCFeddill Ward HODS@
Aug 21 * Ward IV - Theodore Johns library
Aug 26 * Ward II - Forest Park Methodist Church
Sep 10 * Public Hearing - City Hall
Sep 17 * Adoption of Budget, CIP, Tax Rate
* Dates are tentative
LONG -RANGE FINANCIAL PLAN
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City of Beaumont
April 1, 2002
To the Honorable Mayor and Councilmembers
INTRODUCTION
The Long-Range Financial Forecast, the Capital Improvement Program and the Annual
Budget, combine to form the basis of the annual budget process for the City of
Beaumont. The first report, the Long-Range Financial Forecast, is presented to Mayor
and Council prior to April 1 each fiscal year. The forecast is prepared to assess the
City's current financial condition and project that position ten years into the future
utilizing current policies, trends and assumptions, while maintaining the existing levels
of City services. The Capital Improvement Program and Annual Budget provide
increasing levels of detail and analysis.
The impact of the Long Range Financial Forecast will be reviewed during the 2002
Budget Summit mid May in preparation of the fiscal year 2003 Annual Budget. The
City's fiscal year encompasses the period from October 1 to September 30.
GENERAL GOVERNMENTAL FUNDS
General governmental funds include the General Fund and Debt Service Fund. The
General Fund accounts for the fundamental operating costs of most city departments.
The Debt Service Fund is used to record the resources received to retire the
outstanding debt obligations which are secured by taxes levied by the City.
Finance Department • (409) 880-3789 • Fax (409) 880-3132
P.O. Box 3827 • Beaumont, Texas 77704.3827
General Fund Revenues
The majority of revenues recorded in the General Fund are derived from Sales Tax,
Property Tax, Industrial Payments and Gross Receipts Tax. The following illustrates the
proportion of each source for FY 2002.
General Fund Revenues
by source
37.7% Sales and use tax
17.2% Property taxes
11.6% Other
17.3% Industrial payments 7.2% Utility in lieu
8.9%Gross receipts tax
$70,953,500
The forecast of revenues is based on several assumptions.
Sales and use tax is projected to increase slightly in FY 2002 to $26.8M which is the
original budget amount. Administration has been reporting to Council monthly
regarding this revenue source in light of the events of September 11. At this time it is
expected that these revenues will be realized. The remaining years of the long range
forecast project annual increases of two to three and one-half percent providing
increasing additional revenue of between $500,000 - $1.1 M annually.
Property taxes represent $12.2M of total General Fund resources, at a tax rate of
$0.31 per $100 of assessed value. Estimates for this revenue source assume the
potential for growth in assessed value at a range of 2.5% - 3%. Positive economic
conditions related to the construction of several new retail centers, the Entertainment
Complex and downtown improvements support increasing assessed values in future
years. With no change in the tax rate proposed, revenues are estimated at $12.6M in
FY 2003. This is an increase of 3% from FY 2002 estimates. The forecasted increase in
assessed value will drive the increased property tax revenues for FY 2003.
In fiscal years 2004, 2006, 2008 and 2011 the anticipated reduction in existing debt
service requirements would allow for a reverse shift in the dedication of the tax rate
from the Debt Service Fund to the General Fund. However, the issuance of$9M in
certificates of obligation is proposed in the fall of 2002 to fund current and critical need
projects. If authorized, a reverse shift from debt service would not be feasible until
2
fiscal year 2006 at which time one cent would equal approximately $425,000. Based on
the assumptions of this plan, an estimated $0.045 would be available at that time.
Industrial payments account for approximately $12.3M. The reduction of 2.5% for FY
2003 is a result of a one-time payment received from ExxonMobil in FY 2002. Current
contracts were negotiated in FY 2002 and have a seven year term. The most significant
contract is with ExxonMobil followed by duPont and Goodyear. These industries
combine to provide 75% of the existing industrial payment revenues. The average
growth rate for projections beyond FY 2003 is 2%, which like the property tax, is
predicated on positive economic conditions and growth in assessed values.
Gross receipts taxes (franchise fees), collected from utility companies operating
within the City, are estimated at $6.4M for FY 2002, a decrease of 10.8%. This
decrease is attributable to the return from extraordinary natural gas prices and higher
usage during FY 2001. Based on current known conditions and trends, these revenues
are projected to increase 2% annually for the foreseeable future. Entergy is the lead
contributor of gross receipts tax and is the most sensitive to fluctuation. Utility rate
reductions and lower usage directly impact the receipt of these taxes by effectively
reducing the "gross receipts" on which the tax is based.
Overall, an average 2.2% growth rate is projected for in General Fund revenues for the
10 years in this forecast.
Total General Fund Revenues
100
80 ......................................_.............._................................................................... ... ... ... .......
60 ... ... ... ... ... .......
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20 ... ... _. .......
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Fiscal year
®Sales and use tax w Property taxes ❑Industrial payments
O Gross receipts tax ®Utility in lieu ❑Other
3
General Fund Expenditures
The basic costs of operating the City are charged to the General Fund. These
disbursements provide for Police; Fire; Public Works; Health, Culture and Recreation;
Central Services; and General Government.
Current assumptions maintain existing services at FY 2002 staffing levels, contractual
salary increases for civil service personnel (estimated for fire civil service as contract is
in negotiation) and an annual salary adjustment of 3% for civilians. For this report,
funding limitations predicated the exclusion of future salary adjustments associated
with the Classification Compensation plan which began in FY 2001.
Transfers, reflecting those charges related to dependent healthcare, workers
compensation, the cost of liability claims and lawsuits, facility renovation and the transit
subsidy, are anticipated to increase $177,000 for FY 2002. This change reflects an
increase of$229,000 for dependent healthcare and 180,000 for the transit subsidy.
These increases were offset by decreases in the transfer to Capital Reserve of
$200,000 and General Liability, $100,000. Future increases in this category are most
significantly related to dependent healthcare which is projected to impact the General
Fund by over $500,000 annually.
Total expenditures are expected to grow an average of 2.5% annually throughout the
projection period.
General Fund Expenditures
by category
FY 2001 FY 2002 FY 2003
Actual Estimated Projected
Wages $41,284,435 42,523,400 43,586,000
Benefits 8,520,202 9,094,400 9,252,900
Other Operating 14,028,657 13,483,700 13.536,000
Total Operating 63,833,294 65,101,500 66.374,900
Dependent Healthcare 4,080,259 4,309,500 4,903,500
Workers Compensation 822,000 895,000 901,000
Capital Reserve 500,000 300,000 300,000
General Liability 300,000 200,000 250,000
Transit Subsidy 845,000 _1,020.000 _1,200,000
Total Transfers 6.547.259 6,724,500 7.554,500
Total General Fund $70,380,553 71,826,000 73.929,400
4
Fund Balance
For the fiscal year ending September 30, 2002, the City will maintain a fund balance in
the General Fund of 9% of expenditures. It is projected, based on current
assumptions, that by FY 2003, the level will fall seriously below the goal of 8-10%
and end the year with a fund balance equal to 5.9% of expenditures. Using
projected levels of revenues and expenditures, it is anticipated that the FY 2005 fund
balance will fall into a deficit position.
Storm Water Utility
The creation of a Storm Water Utility to capture the rising costs associated with the
Environmental Protection Agency (EPA) storm water runoff requirements continues to
be considered a viable and prudent solution to this unfunded mandate. If implemented,
approximately $2.6M in General Fund costs related to storm water would be recovered
by a fee charged by the Storm Water Utility. This revenue source could effectively
provide relief to General Fund resources which could then be directed to other uses. It
would also serve to sustain General Fund fund balance at a level that is sufficient to
meet policy guidelines.
Debt Service Fund Expenditures
The major source of revenue recorded in the Debt Service Fund is property taxes.
Currently, a rate of$0.325 is applied to each $100 in assessed valuation. As noted in
the General Fund discussion, the rate of growth for assessed valuation is estimated to
range from 2.5% to 3% during the term of this forecast.
In order to fund the ongoing Capital Improvement Program (CIP), debt issues of$9M in
August 2002 and $8M August 2003 are proposed. The first issue would provide the
resources to complete projects classified as current in the FY 2002 CIP and fund
critical need projects. The next issue would allow for the continuance of the capital
program. A dynamic document, the projects in the CIP are reviewed, prioritized and
approved annually by Mayor and Council.
Debt Service Requirements
Existing and Potential
20
.............................................................................................................................................................................................
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Fiscal Year
ED Existing Debt Service Requirements p Potential$9M-August 2002
® Potential$8M-August 2003
5
The effect of debt service related to the proposed August 2002 $9M issue will be
realized beginning FY 2003 with interest only payments projected for year one and two.
The anticipated FY 2003 $8M issue is also projected with interest only payments in the
first two years, beginning in FY 2004.
The debt service policy calls for 20% of principal and interest requirements as an
adequate level of fund balance. FY 2001 and 2002 are slightly below policy at 18% and
18.5% respectively. With no increase in the tax rate projected, fund balance will fall to
17.1% at fiscal year end 2003 specifically related to the anticipated 2002 $9M issue.
Additional revenue of$200,000 in FY 2003 would be adequate to maintain the fund
balance at the FY 2002 level of 18.5%. Equating to an increase in the tax rate of
$0.005, this could be achieved by either increasing the total tax rate or shifting this
amount from the dedicated General Fund rate. A $0.0005 increase will adequately
provide for debt services payments related both issues addressed in this report.
Based on these assumptions, the capacity exists to issue new debt or shift a portion of
the tax rate dedicated to Debt Service to the General Fund in fiscal years 2006, 2008
and 2011.
INTERNAL SERVICE FUNDS
Internal Service Funds account for common charges to all departments. Risk
management for claims and lawsuits are recorded in the General Liability Fund. The
Employee Benefits Fund includes all health benefits, worker's compensation and
unemployment charges. Equipment and vehicle purchase, as well as building
renovations, are charged through the Capital Reserve Fund. These charges are
recorded proportionately in individual departments, per employee or by equipment. The
funding sources for these funds are through charges and/or transfers from other funds.
Employee Benefits Fund
Funded through charges and transfers from other funds, the Employee Benefits Fund
has no independent revenue source other than employee contributions, which provide
approximately 12% of the revenues in this fund. For FY 2002, the City raised it's
contribution toward health benefits from $6,100 per employee to $6,650, which is
driven by the rising cost of the employee health plan and prescription program. The
employee rate for dependent coverage was increased $12 per month, effective January
2002, to further offset rising costs. Current contribution levels will result in a fund
balance for FY 2002 of$1.6M. An increase in the City's contribution of $550/employee
is included in this forecast for FY 2003. The approximate amount of claims that have
been incurred but not reported in the indemnity plan, coupled with the reserve
requirements necessary to fund incurred workers compensation claims, dictate a level
of fund balance of approximately $1.3M. Based on these assumptions, the projected
level of contributions will be sufficient to provide adequate coverage.
6
Capital Reserve Fund
Originally created to provide for the replacement of equipment and vehicles, the Capital
Reserve Fund also exists to provide for the renovation of public facilities that are not
major capital improvements. It is anticipated that expenditure levels will be reduced and
available fund balance will be utilized during the first several years of the projection
period. The ending fund balance in FY 2003 is projected at $530,000. This will drop to
a projected low of$440,000 in FY 2004.
General Liability Fund
Initiated in FY 1987, the General Liability Fund is the central repository for the payment
of claims, lawsuits and the professional services related to the defense of claims made
against the City. With an estimated liability for claims and lawsuits slightly under $1 M, it
is projected that adequate resources will be available through this projection period.
The sole funding source for the General Liability Fund is transfers from other funds.
SUMMARY
In summary, administration's assumptions include average general revenue increases
of 2.2%. Projections for General Fund operating expenditures show an increase 2.5%
annually for personnel, with other operating costs remaining relatively flat. This
increase is expected to maintain the same level of service. Based on these revenue
and expenditure assumptions, fund balance is expected to drop seriously below policy
levels in FY 2003, with a deficit fund balance anticipated by fiscal year end 2005.
The Debt Service Fund will require an additional $200,000, approximately one half
cent, in FY 2003 to cover existing requirements. This could be achieved by either
increasing the total tax rate or shifting this amount from the dedicated General Fund
rate. Notwithstanding the issuance of new debt, beginning in fiscal year 2004, the
capacity exists to reverse shift a portion of the Debt Service dedication to the General
Fund. If authorization is granted for the $9M issue, the reverse shift would be deferred
to FY 2006.
Internal Service Funds, including Employee Benefits, Capital Reserve and General
Liability, are dependent on service charges and transfers from other funds to service
the claims and purchases recorded therein. Sustaining sufficient fund balances will
require an increased contribution in the Employee Benefits Fund.
Tables are attached for each of the funds discussed. The information provided is
organized so that a brief historical perspective may be gained as well as a forecast
studied, which is based on current known conditions and historical trend analysis.
Reports to Council will be made as needed should future developments occur that
significantly impact the City's financial condition.
Respectfully submitted,
Stephen J. Bonczek
City Manager
7
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
General Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY_2009 FY 2010 FY 2011
REVENUES
Sales and Use Tax $ 26,180 26,752 27,287 27,833 28,668 29,528 30,414 31,478 32,580 33,720 34,900
Property Taxes 12,521 12,213 12,579 12,893 13,215 13,545 13,884 14,231 14,587 14,952 15,326
Industrial Payments 11,267 12,306 11,985 12,215 12,215 12,445 12,680 12,920 13,165 13,420 13,670
Gross Receipts Tax 7,115 6,350 6,477 6,607 6,739 6,874 7,011 7,151 7,294 7,440 7,589
Utility Fund In Lieu 4,250 5,100 5,100 5,200 5,200 5,300 5,300 5,400 5,400 5,400 5,400
Other - 7,437 8,233 8,315 8,398 _ 8,482 8,567 8,653 8,740 8,827 8,915 9,004
TOTAL REVENUES 68,770 70,954 71,743 73,146 74,519 76,259 77,942 79,920 81,853 83,847 85,889
EXPENDITURE CATEGORY
Wages 41,285 42,523 43,586 44,676 45,793 46,938 48,111 49,314 50,547 51,811 53,106
Benefits 8,520 9,095 9,253 9,416 9,583 9,754 9,929 10,109 10,293 10,482 10,675
00 Other operating 14,029 13,484 13,536 13,657 13,779 13,922 14,046 14,172 14,299 14,447 14,576
Total Operating 63,834 65,102 66,375 67,749 69,155 70,614 72,086 73,595 75,139 76,740 78,357
Dependent Healthcare 4,080 4,309 4,903 5,437 5,966 6,387 6,834 7,296 7,790 8,316 8,860
Workers Compensation 822 895 901 907 912 918 924 905 911 918 924
Capital Reserve 500 300 300 300 300 500 500 500 500 500 500
General Liability 300 200 250 250 250 250 250 250 250 250 250
Transit Subsidy 845 1,020 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200
Total Transfers Out 6,547 6,724 7,554 8,094 8,628 9,255 9,708 10,151 10,651 11,184 11,734
TOTAL EXPENDITURES 70,381 71,826 73,929 75,843 77,783 79,869 81,794 83,746 85,790 87,924 90,091
EXCESS(DEFICIT) REVENUES
OVER EXPENDITURES (1,611) (872) (2,186) (2,697) (3,264) (3,610) (3,852) (3,826) (3,937) (4,077) (4,202)
FUND BALANCE
Beginning Fund Balance 9,015 7,404 6,532 _ 4,346 1,649 (1,615) __L,225) (9,077) X12,903) (16,840) (20,917)
Ending Fund Balance $_ 7,404 6,53.2 _-4,346 1,649. (1,61.5) (5,225) (%077) (12,903) (16,840) -A20.917) (25,119)
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
Debt Service Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 200_1_ FY 2002 _FY_2.003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
REVENUES
Property Tax Revenue $ 11,507 12,675 12,991 13,308 13,644 12,085 12,379 7,379 7,566 7,747 6,981
Interest Earnings 241 240 204 200 230 270 258 259 237 219 213
Miscellaneous Revenue 839 1,027 1,034 1,099 1,148 1,153 1,155 1,154 1,232 1,232 1,237
TOTAL REVENUES 12,587 _ 13,942 14,229 14,607 15,022 13,508 13,792 8,792 9,035 9,198 8,431
EXPENDITURE CATEGORY
Principal&Interest(P& 1 13,135 13,716 13,772 13,447 13,458 12,169 12,115 7,554 7,701 7,671 6,835
P & I-anticipated issues -- -- 537 997 1,251 1,546 1,640 1,640 1,640 1,640 1,640
Service Charges 9 10 10 10 10 10 10 10 10 10 10
TOTAL EXPENDITURES 13,144 13,726 14,319 _ 14,454 14,719 13,725 13,765 9,204 9,351 9,321 8,485
EXCESS (USE)OF FUND
BALANCE (557) 216 (90) 153 303 (217) 27 (412) (316) (123) (54)
FUND BALANCE
Beginning Fund Balance 2,880 2,323 2,539 2,449 _ _2,602 2,905 2,688 2,715 -2,303 1,9V _ 1,864
Ending Fund Balance $_ 2,323 2.539. 2449 2,602 2,905 2,688_ 2,715 2,303 1 087 1,864 1.810
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
Employee Benefits Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY FY 2007_ FY 2008 FY 2009 FY 2010 FY 2011
REVENUES
Charges to Funds
Health Insurance $ 8,561 9,245 9,998 10,701 11,396 11,951 12,538 13,148 13,797 14,488 15,205
Worker's Comp. 1,014 1,110 1,120 1,125 1,130 1,135 1,145 1,125 1,130 1,135 1,145
Unemp.lTerm STD 290 410 360 360 310 310 280 280 260 260 260
Employee Contributions 1,430 1,524 1,540 1,557 1,574 1,591 1,608 1,625 1,643 1,661 1,679
Interest Earnings 133 90 100 100 100 100 100 100 100 100 100
Miscellaneous Revenue 51 -- 20 20 20 20 20 20 20 20 20
TOTAL REVENUES 11,479 12,379 13,138. 13,863 14,530 15,107 15,691 16,298 16,950 17,664 18,409
EXPENDITURE CATEGORY
Health 9,302 10,860 11,662 12,380 13,090 13,660 14,267 14,897 15,560 16,266 17,004
o Workers Compensation 1,229 1,109 1,116 1,123 1,130 1,137 1,144 1,121 1,129 1,137 1,145
Unemployment 50 60 60 60 60 60 60 60 60 60 60
Short-term Disability 422 350 300 300 250 250 _ 220 _ 220 _ 200 _ 200 200
TOTAL EXPENDITURES 11,003 12,379 13,138 13,863 14,530 15,107 15,691 16,298 16,949 17,663 18,409
EXCESS(DEFICIT) REVENUES
OVER EXPENDITURES 476 -- -- -- -- - --
-- 1 1 --
FUND BALANCE
Beginning Fund Balance 1,122 _ 1,598 1,598 1,598 1,598 1,598 1,598 1,598 1,598 1,599 1,600
Ending Fund Balance $ 1,598_ 1,598 . 1,598 1,598 1,598 1-598 1,598 _ 1,598. 1_L99_ 1,600 1,600
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
Capital Reserve Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
REVENUES -.._ --. _ . ---- --
Service Charges $ 1,506 1,394 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500
Interest Earnings 55 60 35 24 22 29 38 46 43 53 66
Miscellaneous Revenue 52 20 20 20 20 20 20 20 20 20 20
Transfers In 1,138 358 358 358 358 558 558 558 558 558 558
TOTAL REVENUES 2,751 1,832 1,913 1,902 1,900 2,107 _.2,116 2,124 2,121 2,131 2,144
EXPENDITURE CATEGORY
Renovations 101 297 50 50 50 50 50 100 100 100 100
Equipment 1,150 266 200 200 200 200 400 500 500 500 500
Vehicles 965 1,058 1,000 1,000 1,000 1,000 1,000 1,200 1,200 1,250 1,250
Debt Service 586 776 907 740 556 556 481 380 100 -- --
TOTAL EXPENDITURES 2,802 2,397 2,157 1,990 1,806 1,806 1,931 2,180 1,900 1,850 1,850
EXCESS(DEFICIT) REVENUES
OVER EXPENDITURES (51) (565) (244) (88) 94 301 185 (56) 221 281 294
FUND BALANCE
Beginning Fund Balance 1,388 1,337 772 528 440 534 835 1,020 964 1,185 1,466
Ending Fund Balance $ 1,337 772 528 440 534 835. 1,020 _ -._964 ___..1,185 - .-1,466 1,760_
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
General Liability Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
REVENUES —
Interest Earnings $ 76 60 40 40 50 50 50 50 50 60 60
Transfer in/Service Charg 500 400 —550 550 550 550 550 550 550 550 550
TOTAL REVENUES 576 460 590 590 600 600 600 600 600 610 610
EXPENDITURE CATEGORY
Professional Services 51 100 80 80 80 80 80 80 80 80 80
Liability Claims 741 700 500 500 500 500 500 500 500 500 500
Other Insurance 3 4 4 4 4 4 4 4 4 4 4
TOTAL EXPENDITURES 795 804 584 584 584 584 584 584 584 584 584
ry EXCESS(DEFICIT) REVENUES
OVER EXPENDITURES (219) (344) 6 6 16 16 16 16 16 26 26
FUND BALANCE
Beginning Fund Balance 1,477 1,258 914 920 926 942 958 974 990 1,006 1,032
Ending Fund Balance $—_ 1,258 914 _920 926 942 958 974. 990 1 006. 1 032 1,058
CAPITAL IMPROVEMENT PROGRAM
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May 14, 2002
To the Honorable Mayor and Councilmembers
Capital Program
The Capital Program, sometime referred to as the Capital Improvement Program (CIP), is
a plan prepared annually to provide for both short and long range physical development
within the City of Beaumont. Charter requires the submission of the CIP to Council as part
of the financial planning process. It is adopted in September with the annual operating
budget. The CIP allows for project evaluation at a comprehensive level and also provides
the financial information necessary to plan and anticipate potential changes to the tax
structure, user fees and bonded indebtedness.
Generally, a capital improvement has the following characteristics: relatively high monetary
value (at least $100,000), long life (will last at least 10 years), and results in either the
creation of a fixed asset, or the revitalization of one. Fixed assets are resources owned by
the City which have monetary value, long-term character and will be held or used. Examples
are land, buildings and improvements to land other than buildings. Included within the above
definition are the following specific items: purchase, improvement and development of land;
construction of new facilities for the delivery of City services; remodeling of existing facilities;
and the planning/engineering costs related to specific improvements of the type listed above.
The CIP includes a listing of all General and Public Works improvement projects along with
project descriptions and cost estimates. General Improvements include Parks and
Recreation, Public Safety and other general government municipal facility improvements,
whereas Public Works Improvements include street and stormwater drainage projects. For
informational purposes, water system projects are listed separately in this document;
however, they are funded through water revenues rather than property taxes.
Approved projects are classified in three phases: current, scheduled and planned. A
project classified as current is underway orwill be underwaywithin the calendar year.Those
classified as scheduled are under design and right-of-way is being acquired however no
construction contract has been let. Projects classified as planned are approved projects but
are only in the preliminary stage. Other projects for consideration, also included in this
presentation, represent projects that are desirable but are not included in the five year plan.
Capital Program 2003
May 14, 2002
Completed Projects (1998-2002)
Since 1998, approximately$36.9M of projects, both general improvement and public works,
have been completed or will be completed prior to fiscal year end 2002. The general
improvement projects completed during this five year period totaled $16.3M. The costs for
all public works projects topped $20.6M. An average of $7.4M in projects were completed
annually during this period. A summary of the projects completed from 1998-2002 follows:
YEAR DESCRIPTION AMOUNT
Public Works Projects
1998 Royal Street Outfall $ 940,000
Eleventh Street-Washington to Fannett 1,900,000
Folsom Road - Crow to Dowlen 1,500,000
1999 Chaison Street- Threadneedle to Harriot 156,000
2000 Walden Road/Ditch 109 845,000
Ector Street Ditch 500,000
2001 Concord Road - Phase 1 (1-10 to Helena) 3,500,000
Franklin Street 785,000
Folsom Road 2,900,000
Frontage Road - Entertainment Complex 1,000,000
2002 Walden Road - Major Dr. To Fannett 6,570,000
General Improvement Projects
1998 Elmo Willard Library $1,695,000
Julie Rogers Theatre - Site Development 255,000
1999 Alice Keith Swimming Pool 1,380,000
2000 Municipal Court Building 1,904,000
Fire Station Construction (3) 2,285,000
Beaumont Yacht Club Additions 1,080,000
Parks Maintenance Facility 700,000
2001 Police Building Renovation 300,000
Fire Training Center Improvements 1,496,000
Athletic Complex - Softball Fields 1,616,000
Airport Fuel Facility 195,000
2002 Airport Runway Extension 268,000
Miller Library Expansion 475,000
T. R. Johns, Sr. Library 1,950,000
Playground Renovations 410,000
Perlstein Park 275,000
Capital Program 2003
May 14, 2002
Outstanding Debt
Relative to the assessed value of property within the Beaumont city limits, the outstanding
general obligation debt has ranged between a high of 2.41%at 10/01/99 and a low of 1.95%
at 10/01/97.The increasing assessed valuation of property is attributable to both the addition
of new property to the tax roll and increasing values of existing properties. The growth in
assessed value mirrors the level of debt issued by the City for improvements to infrastructure
which support a growing economy. The debt level has fluctuated between$67M at 10/01/94
to $89M at 10/01/99 while maintaining an average basis of 2.12%for period under review.
The projected debt ratio at 10/01/02 is in line with the average at 2.10% of assessed value.
The following table illustrates this discussion.
Outstanding Assessed Debt
Debt (1) Value Ratio
10/01/93 71,922,491 3,245,152,910 2.22%
10/01/94 67,584,491 3,251,615,993 2.08%
10/01/95 68,501,191 3,311,639,210 2.07%
10/01/96 71,482,591 3,420,010,280 2.09%
10/01/97 68,286,391 3,499,102,595 1.95%
10/01/98 76,723,691 3,661,785,240 2.10%
10/01/99 89,243,491 3,701,491,226 2.41%
10/01/00 81,093,791 3,779,873,302 2.15%
10/01/01 80,276,091 3,908,466,045 2.05%
10/01/02 (2) 85,362,576 4,025,700,000 2.10%
' Outstanding debt shown net of self-supporting HUD Section 108 loan.
2 Preliminary 10/01/02 outstanding debt includes proposed debt issue.
Capital Program 2003
May 14, 2002
As a percentage of total general government expenditures(General Fund and Debt Service),
annual tax supported debt service payments have ranged from 14.85%to 15.77%during the
period FY99 through FY02. Considering existing debt levels along with the anticipated
issuance of$9M in the fall of FY 2002, this ratio is projected at 15.70% for FY 2003.
Fiscal General Govt. Debt Service Percent
Year Expenditures Payments of Total
1999 73,707,665 11,046,675 14.99%
2000 78,433,086 12,371,272 15.77%
2001 82,687,272 12,297,280 14.85%
2002 (Est) 82,701,516 12,689,100 15.34%
2003 (Proj) 84,525,116 13,274,639 15.70%
Debt Service Payments
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O General Govt Expenditures ®Debt Service payments
Capital Program 2003
May 14, 2002
Capital Program 2003
Current, scheduled and planned projects total $71M. Individual project descriptions, with
maps for street and drainage projects, may be found in the section titled "Project
Descriptions."
The following table identifies the specific cost associated with each phase of the CIP.
Capital Program 2003
Program Summary
Cost
Public Works Improvements
Current $23,360,000
Scheduled 7,350,000
Planned 28,400,000
Total 59,110,000
General Improvements
Current $1,353,900
Scheduled 1,075,000
Planned 9,897,000
Total 12,325,900
Total Program Cost $71,435,900
Funding
Financing for the annual program is provided by the "cash flow" approach, whereby debt is
issued to generate enough cash to pay the actual expenditures during the year for both
existing and new projects. This approach provides the most efficient use of the public tax
dollars by allowing multi-year projects to be initiated without issuing debt for the full cost of
the projects at the time of project commencement. All available funding sources are
considered. Historically, funding has been provided by the sale of general obligation debt,
Community Development Block Grant, and various Federal and State agencies.
Capital Program 2003
May 14, 2002
Based on a "cash flow" approach the City expects to sell $9M in Certificates of Obligation
(CO's) in the fall of FY 2002. This inflow of cash will provide sufficient cash flow for current
General and Public Works Improvement projects and a significant portion of scheduled.
Funding for the remaining planned projects has not been identified. As these projects
transition into the "scheduled" or "current" classification funding requirements will be
reviewed and proposed. Several factors which are unforeseeable will dictate the amount of
debt issued. Weather, planning, design and construction costs all factor into the decision of
when and how much debt to issue.
The funding required to complete all current and scheduled projects is estimated at$10.1 M
at this time.
Capital Program 2003
Funding Summary
Estimated Cost of Projects
Current $24,713,900
Scheduled 8,425,000
Planned 38,297,000
Total $71,435,900
Funds Available
Committed $23,040,500
2002 Proposed CO's 9,000,000
Total $32,040,500
Funds required to complete
Capital Program 2003 $39,395,400
Effect on Operating Costs
It is expected that the operational needs related to current and scheduled Public Works
Improvements will be absorbed into existing operating departments and will not require
additional personnel. The most significant operating item is maintenance of rights-of-way
related to street projects, which will be handled by the Parks Division.
The projects within the General Improvements category will be handled the same way.
Additional operating needs will be absorbed.
Capital Program 2003
May 14, 2002
Water Utilities Improvements
The City Public Works Department has worked with engineering firms to identify necessary
improvements to the water and waste water systems. Preliminary estimates for the
renovation of the systems, which will be completed over a five year period, is in excess of
$691M.These renovations are required to meet federal and state mandates as well as meet
the needs of the City's growth. Individual project descriptions may be found in the section
titled "Project Descriptions."
The initial sale of$25M in Water Revenue Bonds in August 2000 funded the first phase of
these improvements. A rate adjustment of 30%was made in July 2000 with increases of 4%
in July of 2001, 2002 and 2003. These increases are necessary to adequately fund debt
service requirements. A debt issuance of $30M will be completed this summer to provide
additional funding for these major system improvements.
Conclusion
The Capital Program is designed to annually review the development and continuing
maintenance of the City's infrastructure. The relationship between the assessed valuation,
outstanding debt, annual debt service requirements and general government expenditures
as illustrated provide a basis for project consideration and funding. Revisions and
amendments may be incorporated into the plan as desired by Council.
Capital Program 2003
Public Works Improvements
Amount
Current Projects.
Major Drive $ 4,000,000 (1)
Neches River Hike and Bike Trail 3,400,000 (2)
Concord Road - Phase II (Includes Delaware outfall) 9,150,000
Concord Road - Phase III (Includes Concord Road North outfall) 5,310,000
Downtown Improvements 1,500,000 (3)
Total $ 23,360,000
Scheduled Projects
Fire Training Grounds South Road/Drainage $ 350,000
Main Street - Calder to Blanchette 2,000,000
Minor Street Rehab Program 1,000,000 (4)
Twenty-Third Street - College to Washington 1,500,000
Virginia - Mercantile to Avenue A 2,500,000
Total $ 7,350,000
Planned_Projects
Caldwood Outfall $ 3,700,000
Delaware - Dowlen to Major 3,500,000 (5)
High School Ditch 8,000,000
Madison Street - Irving to Grove 1,500,000
Moore Street Relief 4,000,000
Old Dowlen - SH 105 Connector 2,600,000
Phelan Boulevard - Major Drive to West of Westbrook 1,500,000
South Park Relief- Remaining phases 3,600,000_
Total $ 28,400,000
Total Public Works Improvements $ 59,110,000
(1) Includes TXDOT funding of 80% or$3.2M.
(2) Includes TXDOT funding of 80% up to maximum of $2.4M.
(3) Includes TIFF funding of$500,000
(4) In CIP due to the proposed elimination of the Street User Fee.
(5) Pursuing earmarked funding of 80% or $2.8M.
Capital Program 2003
General Improvements
_Amount
Current Projects
Charlton Pollard Neighborhood Park $ 1,103,900 (1)
McLean and Roberts Park Improvements _ 250,000 (2)
Total $ 1,353,900
Scheduled_P"o ects
Art Museum of Southeast Texas Roof Replacement $ 150,000
Athletic Complex - Tennis Courts 325,000 (4)
Cottonwood and Magnolia Park Improvements 325,000 (3)
Fletcher Mini Park Improvements 50,000 (4)
Pony League Baseball Field 50,000 (4)
Sprott, Rogers and Central Parks - Spray Devices 175,000 (4)
Total 1,075,000
Planned Proiects
Central Park - Tennis Courts $ 62,000
Communications Network - Phase II 750,000
EMS 2 Facility 375,000
Perlstein Park - Walking Trail/Shelter 150,000 (5)
Riverfront Park - Bank Stabilization 1,135,000
Telephone System Replacement 500,000
Transit System - Coach Acquisition (20) 6,450,000 (6)
Tyrrell Park - Clubhouse 475,000
Total $ 9,897,000
Total General Improvements $ 12,325,900
(1) This project is 100% funded by a combination of CDBG and EDI Grants.
(2) This project includes grant funding of 80% from UPARR and 10% from TPW.
(3) This project includes grant funding of 80% from UPARR and 10% from TPW.
(4) These projects will utilize the $575,000 proceeds from the sale of a portion of Central Park.
(5) Requesting TPW - TX Recreation Trails Fund funding of$50,000.
(6) This project includes Federal, State and Local Transportation grant funding of 80% or $5.16M.
Pursuing other grant funds for remaining 20%.
CALDWOOD OUTFALL
When completed, this project will double the capacity of the Caldwood Addition Outfall and relieve street
flooding. The project includes installation of a trunk system on East Caldwood, installation of inlets and
laterals on Bristol, Sunbury, Medford, Canterbury and the reconstruction of the streets.Also included is the
installation of new laterals, replacement of 50 inlets and reconstruction of Cross, North Caldwood, Central
Caldwood, and South Caldwood Streets. The estimated cost of this project is$3,700,000.
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CONCORD ROAD
This project is needed to relieve the north/south traffic congestion on Eastex Freeway as well as to provide
an extension of M. L. King, Jr. Parkway. Concord road has an indefinite right-of-way and as a result,
additional right-of-way requirements are difficult to determine.The addition of a curb and gutter section will
also require the construction of the Concord Road North Outfall to complement this project as well as the
Delaware Outfall Drainage Project. This project will be carried out In three phases and provide for the
reconstruction of Concord Road from IH-10 to East Lucas into an arterial roadway. Phase I, IH-10 to Helena,
has been completed.Phase 11,Helena to the railroad track,includes the construction of the Delaware Outfall.
Estimated cost for Phase II is$9.2M. Phase III will cover the area from the railroad track to East Lucas and
will include the Concord Road North Outfall. Estimated cost for this phase is$5.3M. Maps with descriptions
for the outfalls are included in alphabetical sequence.
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CONCORD ROAD NORTH OUTFALL
During the design of the Concord Road Project it was determined that a drainage outfall would be needed
for the northern section of Concord Road. This outfall would drain an area that is bounded by Dogwood
Street on the south, U.S. 69/96287 on the west, East Lucas on the north, and the Santa Fe Railroad on
the east In addition to providing drainage for the northern section of the Concord Road Project it will also
provide relief to a portion of the Minglewood Subdivision. The estimated cost of this project is included in
Concord Road Phase III project.
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The extension of Delaware is required to provide an additional easttwest corridor from Eastex Freeway
through to Major Drive. The limits of this project would run from Dowlen Road to Major Drive. Most of the
street right-of-way has been donated, except in the area where an active tank farm exists. The oil field
company anticipates closing the tank farm by 2005. Upon completion of oil field activities, it is anticipated
that the property will become available for development.Property acquisition could delay completion of the
middle portion of the project, and may require construction to be completed in more than one phase. The
remaining right-of-way requirements are contingent upon oil field activity completion.Estimated cost for this
project is$3,500,000.
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DELAWARE OUTFALL
Phase II of the Concord Road Project will require the construction of a drainage outfall. The outfall will be
constructed within the Delaware Street right-of-way from Concord Road to Pine Street,the Pine Street right-
of-way from Delaware to Manning Street, the Manning Street right-of-way from Pine to Astor Street and the
Astor Street right-of-way from Manning to Fletcher Street. In addition to serving as the outfall for Concord
Phase II, this outfall will also provide relief in the Prince Street Drainage. The construction of the outfall is
required prior to commencement of Concord Road Phase II roadway improvements.
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DOWNTOWN IMPROVEMENTS
The downtown area is currently experiencing a tremendous amount of private investment. To make
downtown more attractive and entice further capital investment, the City plans to make street, sidewalk,
lighting and landscaping improvements.Asa part of Phase 1,the City will brick pave Crockett Street between
Main and Pearl,and brick pave the sidewalks in the surrounding block,which includes Crockett,Main, Bowie
and Pearl. The City will also make lighting and landscaping improvements in the above area and construct
arches over Crockett at Main and at Pearl for entrance points into the Crockett Street Entertainment District.
Total estimated cost is $1.5M, with $500,000 being funded with TIFF funds. Phase 11 will continue the
sidewalk, lighting and landscaping improvements to Orleans Street, in front of the Hotel Beaumont and on
Fannin Street in front of the Jefferson Theatre.
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FIRE TRAINING GROUNDS SOUTH ROAD/DRAINAGE
This project provides for improvements to the drainage system and rehabilitation of the roadway on the south
side of the Fire Training Center. The current drainage system and roadway are in very poor condition. The
improvements and rehabilitation will reduce problems with standing water during heavy rains and provide
better access to fire training projects on the south side. Estimated cost of this project is$350,000.
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HIGH SCHOOL DITCH
There are two remaining phases of the High School Ditch project, South and North. Each section consists
of the installation of trunk lines, inlets, manholes and connecting pipe improvements that are required to
complete the drainage improvements in the entire High School Ditch area.This area covers approximately
600 acres and is served mostly by an underground storm sewer system. The primary outfall for the High
School Ditch Drainage area is a 9 foot x 6 foot concrete box culvert which runs from Oxford Street under
the Southern Pacific Railroad tracks and South 11th Street to a concrete lined ditch section near 13th Street.
The concrete lined ditch runs to near Highway 69, 96, 287, and IH-10, where the flow is carried under the
highway by three 7 foot x 8 foot concrete box culverts.The lined concrete ditch then conveys the flow from
the west side of the highway approximately 1,300 feet to Hillebrandt Bayou Oxbow. The engineering phase
of this project is complete. Estimated cost for this project is$8,000,000.
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MADISON STREET
Madison Street, from Irving to Grove, is the primary truck route for the industrial district located east of
Carroll Street. The existing concrete pavement is deteriorating and should be replaced. Estimated cost for
this project is$1,500,000.
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MAIN STREET
The existing pavement on Main Street, from Calder to Blanchette, is beginning to experience numerous
failures as a result of an old waterline that runs underneath it. After continually repairing the roadway, it is
now at the point that the entire roadway needs to be replaced. The estimated cost to reconstruct this four-
lane concrete roadway is$2,000,000.
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MAJOR DRIVE
Major Drive is a participation project with TxDOT specifically classified as a demonstration project. Our
funding provides for just the purchase of right-of-way and utility relocation that must occur prior to the state
proceeding with its construction project to widen Major Drive from Hwy 105 to Hwy 124. Total cost for just
ROW and utility relocation is estimated at$4M with TxDOT responsible for 80%or$3.2M. The City will be
responsible for the remaining 20% or$800,000. Currently the portion from Hwy 105 to Humble has been
completed.
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STREET NAME CONSTRUCTION LIMIT
Amarillo Victoria/SantaFe RR
Avenue E May/Virginia
Avenue H Gilbert/Cartwright
Avenue I Milam/Blanchette
Avenue I Foch/Cartwright
Avenue I Roberts/Avenue F
Blanchette 12th/SantaFe RR
Coast Simmons/Liveoak
Forrest Weiss/Concort Beach
Genoa Elba/Dead End
Goldsborough Byrd/Dead End
Grove Madison/Grant
Harding Lucas/Arthur
Houston Washington/Franklin
Katy Jean/Moses
Kitchner Renaud/Concord
Lou Sarah/Dead End
Lou Sarah/May
Moses Katy/Wescalder
Natalie Adams/Dead End
Perl Rd. Major Dr./John Lee
Pershing Anchor/Dead End
Pine Burr Lucas/Spencer
Roberts Fourth/Avenue B
SanCarlos Guess/Willis
Simmons Gulf/Dead End
Stardust Kipling/Sunburst
Thirteenth Laurel/Cedar
Tilson Jackson/McGovern
Tracey - Pope/Delaware
Concrete Pavement Repair by
Slab Lifting @ Various Locations
Total $ 1,000,000
MOORE STREET RELIEF
The lack of roadside drainage facilities in residential areas, inadequate capacity within existing storm
sewer systems, and large paved areas within the Lamar University campus, all contribute to flooding
problems. The Moore Street Drainage Area is located within the southeast quadrant of the City and is
generally defined as the watershed contributing to the Moore Street Ditch. Drainage generally flows
westward from Highland Avenue and southerly from East Lavaca to University Drive, where storm sewer
pipes convey the storm water to the Moore Ditch. Proposed improvements include the construction of
storm sewers, the removal of a concrete restriction at the old Lower Neches Valley Authority Crossing and
realignment of the channel, the installation of a box culvert crossing Highland Avenue and the replacement
or modification of existing inlets. The preliminary engineering design is complete. The estimated cost of
this project is$4,000,000.
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OLD DOWLEN
Due to the significant development in the Parkdale Mall area, a very high demand has been placed on Old
DcnMen Road between Dowlen and SH 105.While the Dowlen/Old Dowlen intersection has been signalized,
little room for improvement exists at the Old Dowlen/SH 105 intersection due to its close proximity to US 69.
Accommodating the various intersection movements and traffic queuing will require the relocation of the
north section of Old Dowlen Road several hundred feet west. This change would move the intersection
further away from US 69,and it would allow the installation of a traffic signal.Pavement widening to provide
a curb and gutter street will allow greater traffic loads with much less required maintenance. Also included
is the reconstruction of Caswell through to US 69, which Old Dowlen will connect to when relocated. The
estimated cost for this project is$2,600,000.
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Phelan Boulevard west of Major Drive is a heavily traveled two lane roadway that provides access to West
Brook High School and the west end of Beaumont The current roadway cannot adequately handle the traffic
demand and requires widening to a four lane curb and gutter section. Estimated cost for this project is
$1,500,000.
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The remaining phases of the South Park Relief project includes construction of laterals on Campus Avenue,
Zavalla Drive, East Woodrow, Kenneth Avenue, Saxe Street and Florida Avenue. Also included are
improvements to substandard inlets, manholes and connecting pipe. Estimated cost for this project is
$3,600,000.
28
4
TWENTY-THIRD STREET - COLLEGE TO WASHINGTON
Twenty-third Street is currently a two lane roadway with open ditches from College Street to Washington
Blvd.Development along this section of Twenty-third consists of both commercial and residential properties.
The commercial development exists on each end with residential development in the center section. The
reconstruction of Twenty-third Street into a four lane concrete curb and gutter roadway will provide an
improved north/south corridor. Estimated cost for this project is$1,500,000.
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Virginia Street is currently four lanes from Fourth Street to Mercantile Street. The section from Mercantile
to Avenue A is only two lanes with ditches on both sides. The reconstruction of this section into a four lane
concrete curb and gutter roadway would provide a continuous collector between Fourth Street and Avenue
A. This construction would not require any additional right-of-way. Estimated cost for this project is
$2,500,000.
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CAPITAL PROGRAM 2003
GENERALIMPROVEMENTS
ART MUSEUM OF SOUTHEAST TEXAS ROOF REPLACEMENT
Due to numerous leaks and water ponding, replacement of the entire roofing
systems is needed at the Art Museum of Southeast Texas.Work may include a new
polyvinylchloride roofing membrane and structural repairs, including repairs to the
exterior insulation and finish (EIFS) system and stucco surfacing and replacement
of window glazing. Estimated cost of this project is $150,000.
ATHLETIC COMPLEX - Tennis courts
Seepage of water makes the existing eight (8) tennis courts, constructed in 1976,
unsafe and unplayable after rainfall. Renovation of the courts will include
installation of a post tension concrete surface, new surfacing material, striping,
nets, and new fencing. Estimated cost for this project is $325,000 and will be
funded with proceeds from the sale of a portion of Central Park.
CENTRAL PARK - Tennis Courts
This project will provide for the renovation of two (2) tennis courts at Central Park
with an asphalt overlay. The Parks and Recreation Advisory Committee has
recommended this project for FY 2003. Estimated cost of this project is $62,000.
CHARLTON-POLLARD NEIGHBORHOOD PARK
This project replaces Carroll Street Park which was sold to Exxon-Mobil in 1998.
Proceeds from the sale of the old park will be used to procure property for the new
site. The new park, located at the intersection of Sabine Pass and Mary Streets, is
part of a neighborhood revitalization effort in the City's south end. Park facilities
include off-street parking,security lighting,covered picnic area,creative playground
equipment,aquatic spray devices,softball fields,tennis courts, multi-purpose court,
restrooms and jogging path with exercise stations. Construction funding is provided
by a Community Development Block Grant(CDBG)and an Economic Development
Initiative (EDI) grant. The estimated total project cost is $1,103,900.
COMMUNICATIONS NETWORK - Phase II
Phase 11 allows for the Fire Department to connect to the City's 800 MHZ trunked
communication system. Phase I, which includes infrastructure, purchase of police
portables and mobiles, and project design was completed in September, 2001.The
estimated project cost is $750,000.
COTTONWOOD AND MAGNOLIA PARK IMPROVEMENTS
This project will provide for rehabilitation to Cottonwood and Magnolia Parks.
Improvements to Cottonwood Park will include playground equipment, a spray
device, surfacing, drainage improvements, sidewalks, site work and grading,
landscaping, a drinking fountain and a covered hard-surface pavilion.
Improvements to Magnolia Park will include playground equipment, surfacing,
drainage improvements,sidewalks,sitework and grading, landscaping and drinking
fountain. Estimated cost for this project is $325,000 ($260,000 in UPARR funds,
$32,500 in Texas Park and Wildlife funds, and $32,500 in City funds).
EMS 2 FACILITY
This project would provide for the construction of a new EMS 2 Facility at 3020
Municipal Drive. "Medic 2"was previously stationed in a former City fueling station
at this address. Due to severe deterioration, the building was abandoned, and will
be demolished. The City now rents a modular unit to house the medic team. A
rental fee of$5,760 is paid annually.The requested facility contains living quarters,
supply storage areas and covered parking for two to three units. Estimated cost for
this project is $375,000.
FLETCHER MINI PARK IMPROVEMENTS
This project will provide for improvements to Fletcher Mini Park and will include
electrical service, lighting, playground equipment, sidewalks, ADA surfacing,
drinking fountain, grading, and site improvements. Estimated cost for this project
is $50,000 and will be funded with proceeds from the sale of a portion of Central
Park.
MCLEAN AND ROBERTS PARK IMPROVEMENTS
This project provides for improvements to McLean and Roberts Parks.
Improvements to McLean Park will include playground equipment, surfacing,
drainage improvements, sidewalks, site work and grading, landscaping, and a
drinking fountain. Improvements to Roberts Park include playground equipment,
surfacing, drainage improvements, sidewalks, site work and grading, landscaping,
drinking fountain and a water playground. A UPARR grant was awarded in August,
2001 in the amount of $250,000 ($200,000 in UPARR funds, $25,000 in Texas
Parks & Wildlife funds, and $25,000 in City funds).
PERLSTEIN PARK - Walking Trail/Shelter
This project would provide for a walking trail, parking and picnic shelter at Perlstein
Park. Estimated costforthis project is$150,000. Possible funding of up to$100,000
is being pursued from the Texas Recreation Trails Fund of the Texas Parks and
Wildlife Department.
PONY LEAGUE BASEBALL FIELD
The Beaumont Youth Baseball Association has requested a pony league field with
an outfield of 310 feet. Estimated cost for this project is $50,000 and will be funded
with proceeds from the sale of a portion of Central Park.
RIVERFRONT PARK - Bank Stabilization
This project provides for 1,225 feet of bank stabilization. The shoreline along the
west bank of the Neches River is eroding and the existing sidewalk supports are
exposed. The existing sidewalks on the north shore will collapse without support.
Estimated cost for this project is $1,135,000.
SPROTT, ROGERS AND CENTRAL PARKS - Spray Devices
This project provides for the installation of spray devices at Sprott, Rogers and
Central Parks and will include water features, controls, circular pad with non-slip
deck, concrete skirt, and electrical service. Existing wading pools will be removed;
area will be graded, leveled, material added, and sod placed around the new
concrete. Estimated cost for this project is $175,000 and will be funded with
proceeds from the sale of a portion of Central Park.
TELEPHONE SYSTEM REPLACEMENT
This project would provide for complete new telephone systems at City Hall, Police
Department, Fire Headquarters and health facilities located on Washington Blvd.
The existing systems at these locations are outdated and only used or
reconditioned parts are available. City Hall telephone communications switch
remains to be the hub for four sites and is at maximum capacity at this time.
Replacement of the switches would allow for future expansion, include improved
features, and would relieve the City of the precarious situation that currently exists.
Estimated cost for this project is $500,000.
TRANSIT SYSTEM - Coach Acquisition (20)
This project would provide for the purchase of twenty(20)alternatively fueled buses
to replace the existing fleet of diesel powered buses. Total estimated cost for this
project is$6,450,000,which includes Federal, State and Local Transportation grant
funding of 80%, or$5.16M. Currently pursuing other grant funds for the remaining 20%.
TYRRELL PARK - Clubhouse
This project provides for the renovation of the parking lot and clubhouse at the
Henry Homberg golf course. Estimated cost for this project is $475,000.
CITY OF BEAUMONT
CAPITAL RESERVE FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 1,481,703 Accounts Payable $ 218,656
Receivables — Due to Other Funds 77
218,656
Fund Balance, Unreserved 1,263,047
TOTAL AVAILABLE RESOURCES $ 1,481,703. TOTAL CLAIMS ON RESOURCES $ 1.481.703
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
Month Year To Date
Cash Flow from Operating Activities _
Cash Received from Charges for Services $ 146,050 1,037,987
Cash Paid to Suppliers _L475) A36,7"
—145,575 601,193
Cash Flow from Capital and Related Financing Activities
Proceeds From Other Sources — —
Proceeds from Issuing Debt —
Principal Retirement and Interest Charges (167,310) (276,617)
Acquisition of Capital Assets _161,408 538,588
_ L28,718) (815,20
Cash Flow from Investing Activities
Interest Earnings 3,758 33,039
Net Cash Flow (79,385) (180,973)
CASH BALANCE
Beginning Cash Balance __1,561,088 1,662,676
Ending Cash Balance $14-81,703 1,481,703,
20
CITY OF BEAUMONT
CAPITAL RESERVE FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End To
_Month Year To Date 04130/2002 Budget Bu_d_get
REVENUES
Charges for Services $ 116,175 813,225 1,394,100 1,394,100 —
Interest Earnings 3,758 33,039 60,000 60,000 —
Transfers from Other Funds 29,875 209,125 358,500 358,500 —
Proceeds from Capital Leases — — — —
Miscellaneous Revenue — — 20,000 20,000 —
TOTAL REVENUES 149,808 1,055,389 1,832,600 1,8321600 —
EXPENSE CATEGORY
CapitalOutlay-Equipment 61,883 757,244 1,324,800 1,324,800 --
Capital Outlay-Critical Bldg 475 95,682 297,000 297,000 —
Debt Service 167,310 276,617 775,600 775,600 —
TOTAL EXPENSES 229,668 1,129,543 2,397,400 2,397,400 —
EXCESS(DEFICIT)REVENUES
OVER EXPENSES (79,860) (74,154) (564,800) (564,800) —
FUND BALANCE
Beginning Fund Balance 1,342,907 1,337,201 _ 1,337,201 1,171,380 _ 165,821
Ending Fund Balance $ 1.263.047 1,263 047- _ 772,401_ . 606580 165 821_
21
CITY OF BEAUMONT
FLEET FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES _ CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 405,195 Accounts Payable $ 54,555
Inventories 336,451 Accrued Wages Payable 41,916_
Other Receivables — _ 96,471
Fund Balance
Reserved for Inventories 336,451
Unreserved 308,724
645,175
TOTAL AVAILABLE RESOURCES $ 741.646 TOTAL CLAIMS ON RESOURCES $ 741 646.
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
Month Year To Date
Cash Flow from Operating Activities
Cash Received from Charges for Services $ 411,994 2,463,029
Cash Paid to Suppliers (228,215) (1,492,083)
Cash Paid to Employees —_ (92,95 —(661,9
90,854 308,947
Cash Flow from Capital and Related Financing Activities
Cash to(from)Other Funds (13,608) (95,258)
Acquisition of Capital Assets _____(342) L,303)
(13,950) _ (97,561
Cash Flow from Investing Activities
Interest Earnings 313 1,754
Net Cash Flow 77,217 213,140
CASH BALANCE
Beginning Cash Balance 327,978 192,055
Ending Cash Balance $__ 405.195 405 195_
22
CITY OF BEAUMONT
FLEET FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date _0.4/3.0/2_00.2 B_ udget _ Budget
REVENUES
Charges for Services $ 411,994 2,463,029 4,080,100 4,080,100 —
Interest Earnings 313 1,754 4,000 4,000 —
Miscellaneous Revenue — — — — —
TOTAL REVENUES 412,307 2,464,783 4,084,100 4,084,100 —
EXPENSE CATEGORY
Personnel Costs 92,925 661,999 1,195,100 1,195,100 —
Operating Expenses 257,875 1,480,072 2,794,600 2,794,600 —
Capital Outlay 342 2,392 4,100 4,100 —
Transfers Out 13,608 95,258 163,300 163,300 —
TOTAL EXPENSES 364,750 2,239,721 4,157,100 4,157,100
EXCESS(DEFICIT)REVENUES
OVER EXPENSES 47,557 225,062 (73,000) (73,000) —
FUND BALANCE
Beginning Fund Balance 597,618 _ 420,113 420,113 636,489 216,376
__1 6
Ending Fund Balance $ _645,175- _. (245,175 _ _ 347,113. 563 489. _(216.376J
23
CITY OF BEAUMONT
EMPLOYEE BENEFITS FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 1,717,016 Escheat Clearing $ 29,824
Receivables 125 Employee flex plan, suppl life&Rd 22,558
Accounts Payable 7
Accrued Wages Payable 16599
68,988
Fund Balance, Unreserved 1,648,153
TOTAL AVAILABLE RESOURCES $ 1,717,141 TOTAL CLAIMS ON RESOURCES $ 1,717,141
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
__Month Year To Date
Cash Flow from Operating Activities
Cash Received from Charges for Services $ 1,027,701 7,201,209
Cash Paid for Benefits&Services __i1,151,964) _ (7,232,1
(124,263) (30,896)
Cash Flow from Investing Activities
Interest Earnings —7,666 61,758
Net Cash Flow (116,597) 30,862
CASH BALANCE
Beginning Cash Balance 1,833,613 1,686,154
Ending Cash Balance $ 1,717,016 1,717,016
24
CITY OF BEAUMONT
EMPLOYEE BENEFITS FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date 04/301200_2_ _ Budget Budget
REVENUES
Interdepartmental Transfers
Employee Health Ins $ 300,257 2,102,906 3,603,600 3,603,600 -
Dependent Health Ins 468,666 3,283,091 5,641,800 5,641,800 -
Worker's Comp. 92,325 646,658 1,109,900 1,109,900 -
General 34,149 239,041 410,000 410,000 -
Employee Contributions 132,304 924,161 1,524,000 1,524,000 -
Miscellaneous Revenue - 5,352 - - -
Interest Earnings 7,666 60,295 90,000 90,000 -
TOTAL REVENUES 1,035,367 7,261,504 12,379,300 12,379,300 -
EXPENSE CATEGORY
Health
Point-of-Service 582,778 2,977,762 5,011,000 5,011,000 -
HMO Blue Texas 253,476 1,658,278 2,900,000 3,350,000 450,000
Dental 56,301 368,848 617,000 617,000 -
Health Prescriptions 161,708 1,099,547 1,750,000 1,750,000 -
Other Benefits 6,294 44,026 95,000 95,000 -
Total 1,060,557 6,148,461 10,373,000 _ 10,823,000 450,000
Worker's Compensation
Third Party Admin. 5,373 45,810 91,000 91,000 -
Claims Paid 39,488 597,278 950,000 900,000 (50,000)
Safety Management 7,033 76,824 129,200 129,200 -
Excess Insurance - 25,414 25,000 25,000 -
Total 51,894_ 745,326 _1,195,200 _ 1,145,200 (50,0
General
Unemployment 12,045 24,357 60,000 60,000 -
Short-term Disability 27,699 _ 293,073 350,000 - 350,000 - _ _-
Total - 39,744 317,430 -410,000 - 410,000 -
TOTAL EXPENSES - 1,152,195 7,211,217 11,978,200 12,378,200 400,000
EXCESS(DEFICIT)REVENUES
OVER EXPENSES (116,828) 50,287 401,100 1,100 400,000
FUND BALANCE
Beginning Fund Balance 1,764,981 1,597,866 1,597,866 928,102 669,764
Ending Fund Balance $ 1648,153 164$153 1.998,966 = _929.202_ = 1 069 764
25
CITY OF BEAUMONT
GENERAL LIABILITY INSURANCE FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 900,145 Accounts Payable $ 586
_ 586
Fund Balance
Reserved for Claims 899,559
Unreserved —
899,559
TOTAL AVAILABLE RESOURCES $.,__ ._900.145 TOTAL CLAIMS ON RESOURCES $__ 900.145
STATEMENT OF CASH FLOW
For the seven months ended April 30,2002
Current
Month Year To Date
Cash Flow from Operating Activities
Cash Received from Charges for Services $ 33,333 233,333
Cash Paid for Claims _ (6,293) (627,937)
27,040 (394,604)
Cash Flow from Investing Activities
Interest Earnings 2,047 20,309
Net Cash Flow 29,087 (374,295)
CASH BALANCE
Beginning Cash Balance 871,058 1,274,440
Ending Cash Balance $. KO-145 900,145
26
CITY OF BEAUMONT
GENERAL LIABILITY INSURANCE FUND
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
Favorable/
FYE 2001 (Unfavorable)
Current Actual Projected at Year-End to
Month Year To Date _04/3_0/2002 Budget Budget
REVENUES
Interest Earrings $ 2,047 19,619 40,000 60,000 (20,000)
Interdepartmental Transfers 33,333 233,333 400,000 400,000 —
Miscellaneous Revenue — — — — —
TOTAL REVENUES 35,380 252,952 440,000 460,000 (20,000)
EXPENSE CATEGORY
Professional Services 322 24,053 100,000 100,000 —
Settlements 6,557 584,262 700,000 700,000 —
Other Insurance — 3,420 4,000 4,000 —
TOTAL EXPENSES 6,879 611,735 804,000 804,000 —
EXCESS(DEFICIT)REVENUES
OVER EXPENSES 28,501 (358,783) (364,000) (344,000) (20,000)
FUND BALANCE
Beginning Fund Balance 871,058 1,25342 1,258,342 1,272,987 X4645)
Ending Fund Balance $ _ 899,559. _ 899 559.. —_894 342 928,987 3C645)
27
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--Nt,
Capital Trojects funds
CITY OF BEAUMONT
GENERAL IMPROVEMENT FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 184,210 Accounts Payable $ 950
Receivables 500
950
Fund Balance
Reserved for Park Improvements 575,000
Reserved for Construction (543,533)
Reserved for Encumbrances 152,293
183,760
TOTAL AVAILABLE RESOURCES $ 184,710 TOTAL CLAIMS ON RESOURCES $ 184,710
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
per General Ledger
Actual
To Date
Revenues $ 374,335
Expenditures 632,2_2_3
Excess(Deficit)Revenues
Over Expenditures (257,888)
Fund Balance
Beginning Fund Balance 441,648
Ending Fund Balance $ 183,760
FUNDING SUMMARY
April 30,2002
Project
Balance
Funds Available(On Hand/Receivable) $ 183,760
UPARR Funding Provided 200,000
TPW Funding Provided 25,000
Grant Funding Provided 1,052,123
Available from Miller Trust 365,133
Reserved for Parts Improvements(Central Pk) (575,000)
Required future 540,326
Total $ 1,791,342
30
CITY OF BEAUMONT
GENERAL IMPROVEMENT FUND
PROJECT EXPENDITURE REPORT
April 30,2002
Current
Project Expended Project
Budget To Date Balance(1)
EXPENDITURES
Playground Renovations 400,000 274,664 125,336
McLean Park 100,000 625 99,375
Roberts Paris 150,000 625 149,375
Theodore R. Johns Library 1,950,000 1,625,068 324,932
Charlton Pollard Park 1,103,900 376,709 727,191
Miller Library Expansion 800,000 434,867 365,133
TOTAL EXPENDITURES $ 4,503,900 2,712,558 1,791,342
(1) Total project balance includes actual outstanding purchase orders and future purchase orders necessary for completion of
projects. Actual purchase orders as of April 30,2002 were$152,293.
Project Highlights
Renovation of existing playgrounds at Alice Keith, Chaison and Gilbert Parks. Original CIP budget
was$300,000.
Renovations of existing playgrounds at McLean and Roberts Parks with partial funding from UPARR and TPW.
Construction of Theodore R.Johns Branch Library with funding from CDBG, Section 108.
Construction of a park in the Charlton Pollard neighborhood,with other funding from CDBG.
Expansion of Miller Library with proceeds from the Miller Trust.
31
CITY OF BEAUMONT
STREETS AND DRAINAGE IMPROVEMENTS
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash 3,621,912 Accounts Payable $ —
Receivables 495,788
Fund Balance
Reserved for Construction 268,373
Reserved for Encumbrances 3,849,327
4,117,700
TOTAL AVAILABLE RESOURCES $ 4,117,700 TOTAL CLAIMS ON RESOURCES $ 4,117,700
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
per General Ledger
Actual
_ To Date
Revenues 425,049
Expenditures 3,732,456
Excess(Deficit)Revenues
Over Expenditures (3,307,407)
Fund Balance
Beginning Fund Balance 7,425,107
Ending Fund Balance $ 4,117,700
FUNDING SUMMARY
April 30,2002
Project
Balance
Funds Available(On Hand/Receivable) $ 4,117,700
Available from TxDOT 3,906,436
Available from TIFF _
Required(Future) 1,626,703
Total $ 9,650,839
32
City of Beaumont
STREETS AND DRAINAGE IMPROVEMENTS
PROJECT EXPENDITURE REPORT
April 30,2002
Current
Project Expended Project
Budget To Date Balance(1)
EXPENDITURES
Major Dr(Hwy 105 to Hwy 124) 4,000,000 1,741,482 2,258,518
Concord II(Helena St.to RR) 9,150,000 6,811,126 2,338,874
Concord III(RR to East Lucas) 5,310,000 4,259,987 1,050,013
Neches River Hike&Bike Trail 3,400,000 376,445 3,023,555
Walden Road 6,569,100 6,543,616 25,484
Downtown Improvements 1,500,000 545,605 954,395
TOTAL EXPENDITURES $ 29,929,100 20,278,261 .9,650,839
(1) Total project balance includes actual outstanding purchase orders and future purchase orders necessary for completion of
projects. Actual purchase orders as of April 30,2002 were$3,849,327.
Project Highlights
Relocation of utilities and purchase of rights-0f--way on Major Dr from College to Hwy 124. The citys portion is
estimated at$800,000;the state will reimburse other costs up to total project cost of$4M.
Engineering, land acquisition and construction costs for the widening of Concord Road from I1-110 to Hwy 105.
Construction of a Hike and Bike Trail from Riverfront Park to Collier's Ferry Park. The City's portion is estimated
at$900,000;the state will reimburse other costs up to the total grant amount of$2.4M.
Engineering and construction costs for the paving and drainage improvements on Walden Road from
Hwy 124 to Major Dr.
Improvements to downtown streets and sidewalks in conjunction with the Crockett Street Entertainment Complex,
with funding from TIFF estimated at$500,000.
33
CITY OF BEAUMONT
WATER UTILITIES IMPROVEMENT FUND
BALANCE SHEET
April 30,2002
AVAILABLE RESOURCES CLAIMS ON AVAILABLE RESOURCES
Assets Liabilities
Cash $ 4,005,643 Accounts Payable $ 459,700
Receivables – Due to Other Funds --
4_5_9,_700_
Fund Balance
Reserved for Construction (12,502,814)
Reserved for Encumbrances 16,048,757
- 3,545,943
TOTAL AVAILABLE RESOURCES $ 4,005,643. TOTAL CLAIMS ON RESOURCES $ 4 005,643.
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND BALANCE
For the seven months ended April 30,2002
per General Ledger
Actual
To Date
Revenues $ –
Expenses 13,796,286
Excess(Deficit)Revenues
Over Expenses (13,796,286)
Fund Balance
Beginning Fund Balance 17,342,229
Ending Fund Balance $---3.W-943.
FUNDING SUMMARY
April 30,2002
Project
Balance _
Balance to Complete Existing Projects $ 41,273,939
Funds Available(On Hand/Receivable) 3,5451943
Funds Required to Complete Existing Projects $ 727,996
34
CITY OF BEAUMONT
WATER UTILITIES IMPROVEMENT FUND
PROJECT EXPENSE REPORT
April 30,2002
Project Expended Project
Estimate To Date Balance
EXPENSES
Construction Projects
Water Supply Study Phase II $ 1,831,450 1,239,525 591,925
Prison Sewer Force Main 1,460,500 1,390,692 69,808
Water Line Replacement 3,000,000 990,135 2,009,865
Dowlen Rd Sewer Int Rehab 2,771,600 1,790,779 980,821
11th St Sewer Int Rehab 2,758,500 912,678 1,845,822
Gmd Storage Tank-Pine St 7,828,500 3,762,500 4,066,000
Water Meter Relocation 900,000 193,924 706,076
Entertainment Complex 365,000 292,408 72,592
Sewage Treatment Plant 2,720,000 441,778 2,278,222
Tyrrell Park Rd Sewer Int 1,007,900 812,419 195,481
Langham Facility Improv 700,000 652,006 47,994
Loeb Water Tank Rehab 646,100 265,303 380,797
Lawson Raw Water Line 4,000,000 2,656,852 1,343,148
Lawson Pump Station 3,700,000 1,206,678 2,493,322
Water Plant Expansion 14,000,000 209,931 13,790,069
Digester Conversion 1,400,000 251,250 1,148,750
Lawson Rd/Bank Stabilization 1,395,000 558,976 836,024
E Lucas Sewer Interceptor 2,950,000 69,959 2,880,041
Central Trunk Line 5,500,000 _ 44,732 _5,455,268
Total Construction 58,934,550 17,742,525 _41,192,025
Line Relocations
Concord Rd Phase II 780,500 736,172 44,328
Concord Rd Phase III 206,000 168,414 37,586
Total Relocations _ _986,500 _ 904,586 __ 81,914
TOTAL EXPENSES $ 59,921.050 18.647.111_ -41 Z73,939
Water Supply Study Phase q is for the construction of a 5-million gallon clearwell and high service/backwash pump
station at the water treatment plant and improvements to the Lawson's canal pipeline and pump station.
The Prison Sewer Force Main,constructed in 1990, has reached its maximum carrying capacity. An additional force
main is needed to provide service to the prison complex. This initial estimate is for the design phase.
The Water Line Replacement project will replace city wide water tines that are in very poor condition.
The Dowlen Rd&11th St Sewer Int Rehab projects will restore the structural integrity of the interceptors and capture the
lost carrying capacity. These projects will also reduce the bad at the sewage treatment plant by reducing inflow.
The Pine St Ground Storage Tank project is for the demolition and rebuilding of the ground storage water tank at the
water production plant on Pine St.
The Water Meter Relocation project is for Phase I of the relocation of alley meters to street r.o.w.'s.
The Entertainment Complex project involves extensions of water mains to support the SETEX Entertainment Complex.
The Sewage Treatment Plant improvements are for the replacement of the electrical and control systems.
The Tyrrell Park Rd Sewer Int Rehab project will rehabilitate the interceptor and replace manholes.
The Langham Facility improvements are for the replacement of the roof on the main bldg,conversion of the parking shed
into a machine shop,expansion of the parking lot,and additional storage area for materials and equipment.
The Loeb Tank Rehab project provides for repairing and repainting the interior of the steel water storage tank.
Line Relocations consist of water and sewer line relocations due to the Concord Rd street widening project
Lawson Raw Water Line Phase I consists of installing 12,000 LF of 48"pipe to deliver water from L.awson's pump
station to the water treatment plant.
The Lawson Pump Station upgrade will increase delivery to 40 million gallons per day to the water treatment plant
The Water Plant Expansion project will add 14 mgd additional capacity to the water treatment plant
The Digester Conversion project will convert two anaerobic digesters to the aerobic system
The Lawson Rd project will repair the road leading to the pump station and stabilize the river bank. $1 m funded by MRCS.
The E Lucas sewer interceptor will be rehabilitated. it was constructed in 1953.
The Central Trunk 54"diamater line will be rehabilitated. It was constructed in 1954.
35
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OCash & investments O
CITY OF BEAUMONT
STATEMENT OF CASH POSITION
April 30,2002
Current Prior Increase/
Year Year (Decrease)
Balance' Balance' FY 2001-2002
BALANCES CLASSIFIED BY FUND
General Fund 16,487,469 16,409,185 78,284
Hotel Occupancy Tax Fund 338,455 362,114 (23,659)
Municipal Airport Fund 13,429 38,686 (25,257)
Texas Motor Carrier Violation Fund 16,755 15,467 1,288
Municipal Court Security Fund 102,177 66,269 35,908
Municipal Court Tech Fund 273,535 162,360 111,175
Miscellaneous Grant Fund 5,240 (18,716) 23,956
ISTEA Grant Fund - - -
Police Grant Fund (140,047) (207,033) 66,986
Tax Increment Financing Fund (56,498) 350,926 (407,424)
Health Grants Fund (199,495) (149,703) (49,792)
C.D.B.G. Program Fund 70,070 (16,726) 86,796
Shelter Plus Care Grant Fund (9,097) (1,845) (7,252)
Emergency Shelter Grant Fund - (45,595) 45,595
Home Fund (100,809) (78,835) (21,974)
Revolving Loan Fund 154,627 126,455 28,172
Rental Rehab Fund 884 173,472 (172,588)
Library Grants 11,848 (16,106) 27,954
HUD Sec 108 Loan Fund 3,471,339 6,745,720 (3,274,381)
Confiscated Goods Fund 1,039,049 1,508,970 (469,921)
Local Law Enforcement Bg Fund 526,163 622,964 (96,801)
Weed&Seed Fund (8,963) (69,765) 60,802
Street Maintenance Fund 1,178,387 1,960,122 (781,735)
Fire Training Grounds Fund (46,565) 4,371 (50,936)
Transit Fund (751,404) (752,312) 908
Debt Service Fund 3,834,983 3,565,199 269,784
Water Utilities Fund 4,388,530 5,295,111 (906,581)
Solid Waste Fund 2,677,335 3,852,153 (1,174,818)
General Improvements Fund 184,210 235,292 (51,082)
Street and Drainage Improvement Fund 3,621,912 1,927,980 1,693,932
Water Utilities Improvement Fund 4,005,643 21,080,705 (17,075,062)
Capital Reserve fund 1,481,703 767,159 714,544
Fleet Maintenance Fund 405,194 362,217 42,977
Employee Benefits Fund 1,717,016 1,815,601 (98,585)
General Liability Fund 900,145 1,272,736 (372,591)
'Reflects general ledger(book)balances and may differ from investment report due to uncollected items or items in transit.
(continued)
38
CITY OF BEAUMONT
STATEMENT OF CASH POSITION
April 30,2002
(continued)
Current Prior Increase/
Year Year (Decrease)
Balance" Balance' FY 1999-2000
BALANCES CLASSIFIED BY FUND Julie Rogers Trust Fund 222,372 213,969 8,403
Tyrrell Historical Trust Fund 22,407 21,560 847
Expendable Trust Fund 176,704 187,289 (10,585)
Library Trust Fund 121,250 114,484 6,766
Library Endowment Trust Fund 24,630 24,679 (49)
Payroll Fund 526,581 505,449 21,132
Historical Fire Museum Trust Fund 8,735 9,605 (870)
TOTAL ALL FUNDS 46,695,899 68,441,633 (21,745,734)
BALANCES CLASSIFIED BY FINANCIAL INSTITUTION
Petty Cash 13,067 12,717 350
Wells Fargo — — —
Hibernia National Bank 574,533 4,411,967 (3,837,434)
TOTAL CASH 587,600 4,424,684 (3,837,084)
Texpool 4,197,980 21,021,491 (16,823,511)
Logic Investment Pool 11,317,799 4,018,547 7,299,252
TexasTERM Investment Pool — 6,000,000 (6,000,000)
Fidelity Treasury Money Market Fund 3,471,278 6,878,737 (3,407,459)
Agency Securities (book value) 24,121,814 6,101,146 18,020,668
U.S. Treasury Bills (book value) — — —
U.S. Treasury Notes (book value) 2,999,428 19,997,028 (16,997,600)
TOTAL INVESTMENTS 46,108,299 64,016,949 (17,908,650)
TOTAL CASH AND INVESTMENTS 46,695,899 _ 68,441,633 _ (21,745,734
'Reflects general ledger(book)balances and may differ from investment report due to uncollected items or items in transit.
(concluded)
39
CITY OF BEAUMONT
SCHEDULE OF INVESTMENT POSITION
April 30,2002
Face Principal Book Unrealized
Amount Invested Value Earnings
CONSOLIDATED INVESTMENTS
U.S.Treasury Notes 3,000,000 2,998,594 2,999,428 17,608
Agency Securities 24,000,000 24,213,220 24,121,814 198,681
Overnight Investments•
Hibernia National Bank 1,151,049 1,151,049 1,151,049 62
Logic Investment Pool 10,888,486 10,888,486 10,888,486 566
TexPool 3,295,203 3,295,203 3,295,203 166
42,334,738 42,546,552 42,455,980 217,083
RESTRICTED INVESTMENTS•'
Overnight Investments'
Hibernia National Bank 878,559 878,559 878,559 47
Logic Investment Pool 429,313 429,313 429,313 22
TexPool 902,777 902,777 902,777 45
Fidelity Treasury M M Fund 3,471,278 3,471,278 3,471,278 4,235
5,681,927 5,681,927 5,681,927 4,349
48,016,665 48,228,479 48,137,907 221,432
' Reflects collected balances at month end. Will vary slightly from general ledger balances due to items in transit.
Includes Debt Service Fund, and Prior Lien Interest 8 Sinking Fund.
40
CITY OF BEAUMONT
SUMMARY OF INVESTMENT POSITION AND INTEREST INCOME
April 30,2002
INVESTMENTS BY TYPE Face
Amount Percentage
U.S.Treasury Notes 3,000,000 6.25%
Money Market Funds and Pools 18,987,057 39.54%
Agency Securities 24,000,000 49.98%
Bank Deposits 2,029,608 4.23%
48,016,665 100.00%
Current Year Prior Year
Weighted Average Yield of Portfolio 2.786% 5.357%
Weighted Average Maturity of Portfolio 247 95
INVESTMENT MATURITY SCHEDULE Face
Amo-unt. Percentage
Less Than 3 Months 23,016,665 47.93%
3 Months To 6 Months 0 0.00%
6 Months To 9 Months 2,000,000 4.17%
9 Months To 12 Months 6,000,000 12.50%
1 Year to 2 Years 17,000,000 35.40%
48,016,665 100.00%
INTEREST INCOME Increase/
- Current Prior (Decrease)
Year Year FY 2001-2002
Total Unrealized Earnings 221,432 476,795 (255,363)
Realized Interest Income _ _771,898 — 1,819,213 (1,047,315)
Total Earnings 993,330 2,296,008 1,302,67�
41
CITY OF BEAUMONT
SCHEDULE OF PURCHASES,SALES AND MATURITIES
April 30,2002
SCHEDULE OF PURCHASES
Purchase Face Principal
Date Description Amount Invested
04/01/2002 Logic 04/30/2002 3,500,000 3,500,000
3,500,000 3,500,000
SCHEDULE OF SALES AND MATURITIES
Purchase Face Principal
Date Description Amount Invested Sale Price
01/25/2001 FHLMC 04116/2002 2,000,000 2,037,756 2,000,000
04/01/2002 Texpool 04/30/2002 3,000,000 3,000,000 3,000,000
04/01/2002 Logic 04/30/2002 1,000,000 1,000,000 1,000,000
6,000,000 6,037,756 6,000,000
Summery Of.S—a e�-And Maturities YearT"aW
Current Year Prior Year
Average Holding Period Yield 6.006% 5.877%
Market Gain/(Loss) _ _
42
CITY OF BEAUMONT
SCHEDULE OF COLLATERAL
April 30,2002
Face Market Total
Description Amount Value_ Investments'
HIBERNIA NATIONAL BANK
FHLMC 6.500 03/01/14 CUSIP#31294JV47 3,011,536 3,020,917
FNMA 6.49411/01/28 CUSIP#31382LPL4 621,977 611,582
FNMA 6.500 08/15/04 CUSIP#31359MEX7 1,000,000 1,061,563
FDIC _ 100,000 100,000
4,733,513 4,794,062 2,236,299
' Reflects ledger balances at month end for the purpose of evaluating pledged collateral.
43
COMPARATIVE FINANCIAL ANALYSIS
Total Revenues
at 04130
$50
i
$40 '-
................................. ..
I ;
$30
a ........................... ..........................................................._ .
........... ..... ... .............
$20
I ,
...................................................................................... ... .
$10
$0
General Water Solid Waste
Fund Fund Fund
au 1999 ❑ 2000 ❑ 2001 0 2002
I
Total Expenditures
At 04/30
$50 .................... ......................... ... ............................... . . . . . ....... .........�
I
I
. . .......................... . . . ..... .
$40 . ........... .... .. ............... .. ............. ...... .......... . ... ...
....................._................... _.. ... .. .........................................................
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..................
$20 - ............................. ........ ......... ......
.............. ............. .......... .... ...... .. ... ..... .. ...... . .. .... . . .......
$10 ............
I
$0 - --
General Water Solid Waste
Fund Fund Fund
---uii 1999
D2000 ❑ 2001 E, 2002 I
Fund Balance
At 04/30
$20 —
.... . .......................... . ................................
.. .
.... ....... .. ......... . . ........................ . .... ................
$15
.................... . .. . ................
................... ............................ .... .. ........................... .
................. ......................... ................................. ............................
o
$10
................. ................. .........................................
$5 .............
$0
General Water Solid Waste
Fund Fund Fund
N 1999 2000 112001 0 2002
Fiscal Year End Fund Balance
$10 .... ...... ... ._................. ... .. ........ ...... ... _ ..................
..{
............
..................... ..........
. ..................................
_
$6
o -
__...._........._.......... — .........................
$a :fi....... .......
$2 _.__._...
i
$p
General Water Solid Waste
Fund Fund Fund
J® 1999 Actual ❑ 2000 Actual ❑ 2001 Actual 0 2002 Projected)
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DEBT SERVICE FUND
Fund Balance
Current tax rate dedicated to Debt Service
c
E 25
a
20 ..................................................................................................._.....................................
W -- . 19.8% .... 19.6%
a) i 15 .....I 18.5°6 ......
17.1% ..... 18.0% i..... I......
....y ...... .......
,.-
5
m 2002 2003 2004 2005 2006
a Fiscal Year
The financial policies indicate 20% of debt service requirements as an adequate level
of fund balance reserves. The level estimated for fiscal year end 2002 is 18.5%. This
is projected to decrease to 17.1% in FY 2003.
The amount required to elevate the fund balance to the 20% policy level is approximately
$380,000 which is equal to one cent of property tax.
The implementation of the administration's Stormwater Utility proposal would create the
capacity in the General Fund to shift a portion of the dedicated tax rate from the General
Fund to the Debt Service Fund.
Assumptions from the Long Range Financial Plan used in this presentation:
Issue $9M in Certificates of Obligation late FY 2002
Assessed value (AV) growth of 3% in FY 2003
Issue $8M in Certificates of Obligation late FY 2003
Assessed value growth of 2.5% in FY 2004 through FY 2006
HUD SECTION 108 PROJECTS
STATUS OF SECTION 108 PROJECTS
In 1998, the City of Beaumont received approval of Section 108 funding in the amount of
$11,000,000 from the Department of Housing and Urban Development. The Section 108 Program
is a loan guarantee provision of the Community Development Block Grant (CDBG) Program
whereby municipalities can borrow up to five times their annual CDBG allocation. The$11,000,000
loan will be repaid by the City and project developers over a 20-year period.
Crockett Street- The Beaumont City Council approved a Section 108 loan for the Crockett Street
project in the amount of $3,000,000 in August, 1998. The total project cost is estimated at
$10,000,000. The project is the redevelopment ofthe"Dixie Street"commercial block in downtown
Beaumont. .The developers plan to redevelop the two-story historic storefront buildings into a
combination of entertainment, eating, and drinking establishments. Approximately 300 permanent
jobs would be created upon completion of the project. Four(4) of the eleven(11) planned venues
are currently open.
Hotel Beaumont Retirement Home - The Council approved a request from the National
Development Council(NDC) for Section 108 funding in the amount of$3.175 million($2.0 million
loan and $1.175 million grant) in December, 1998. The NDC has completely renovated the Hotel
Beaumont, located at 625 Orleans Street. The total project cost was $7,495,000. The project is
100% complete.
Jefferson Theatre- Council approved Section 108 funding in the amount of$2,000,000 (grant) in
September, 1998. The Theatre will be restored as close as possible to its original design. In 1996,
a concentrated effort was initiated to mobilize over 150 civic leaders and area citizens to undertake
a comprehensive planning process and capital campaign with a goal of raising$3,000,000 in addition
to the $2,000,000 grant from the City. Construction should commence in June, 2002 after final
survey and title work is completed.
Theodore R.Johns, Sr.Branch Library-Council approved Section 108 funding in the amount of
$1,825,000 for the construction ofa new library,the Theodore R.Johns,Sr. Branch. The new library
will replace an outdated facility,the Spindletop Branch,currently serving the south end of Beaumont.
The building will be approximately 12,000 square feet on a five-acre site at the intersection of State
Highway 124 (Fannett Road) and Sarah Street. The Theodore R. Johns, Sr. Library will open on
June 6, 2002.
L.L. Melton YMCA - Council approved Section 108 funding in the amount of$1,000,000 (grant)
for the renovation of the L.L. Melton YMCA and the construction of new facilities. The Melton has
also received an Economic Development Initiative(EDI) from Congress in the amount of$500,000
to assist in the development of the project. The City Council will have a work session in June to
discuss a proposal from the National YMCA.
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Good News/Bad News
FY 2002
Good News
• Industrial Payments Exceed Budget FY 2002
• Higher than Expected Fund Balance
• Personnel Cost Savings
• Building Permits Growth
• Increased Employee Safety - Containing Worker's Compensation Costs
• Fire Training Center Progress Report
Bad News
O Industrial Payments FY 2003
O Proposed Expansion of Sales Tax Holiday
O Rising Cost of Property Insurance
O Appraised Values Lower than Expected
O Sales Tax Receipts
O Increased Transit Operating Costs
GOOD NEWS
Industrial Payments Exceed Budget FY 2002
In addition to renegotiated industrial district contracts,several new companies entered into
agreements with the City. These new contracts brought in approximately$400,000 in new
revenue. Additionally, in consideration for de-annexing a piece of property near their
facility,the ExxonMobil agreement was negotiated at a lower percentage for the first years
of the agreement and included an additional one time payment of approximately$280,000
in FY 2002.
Higher than Expected Fund Balance
Although not a significant increase, the FY 2002 beginning fund balance was $241,000
higher than budgeted projections. No one category significantly contributed to this
increase, however it did include$65,000 in FEMA reimbursements related to tropical storm
Allison. This, combined with the industrial payment windfall received in FY 2002, has the
projected year end fund balance equal to 9.1% of expenditures rather than the 8% level
originally budgeted. Financial policies dictate 8 - 10% as an adequate level of Fund
Balance.
Personnel Cost Savings
Reflecting the efforts of the past three fiscal years, the administration is continuing its
commitment (as attrition allows) to eliminate under-utilized positions from the budget.
Since a substantial number of reductions were made in these prior years, a smaller budget
impact will be realized in FY 2002.
As positions are cut, the tasks assigned to those jobs are distributed among other
employees. In those instances where job reclassifications are not warranted, the persons
assigned those additional duties are considered for a pay increase commensurate with the
amount of work and added responsibility that they assume.
In addition to salary savings from eliminating jobs, the cost of benefits is also saved. The
person assuming additional duties is already a participant in the City's benefits program,
therefore the City is able to save on average 30% of the salary amount for each position
eliminated.
Fiscal year to date a total of eight positions have been designated as "Will Not Be Filled"
in the General Fund for a total savings amount of $303,000. Eliminating these under-
utilized positions minimized the budgetary impact resulting from the two additional
positions required to staff the new Johns Branch Library.The net effect of these personnel
modifications was a savings of$233,300. In the Hotel Occupancy Tax Fund for FY 2002
one position was eliminated and one added for a net cost of$10,800.
Since July 1999 the administration has eliminated 42 under-utilized positions with a value
of $1,981,500. These eliminations generated the capacity to add 44 positions which
included 10 paramedics (seven of which staffed a fifth ambulance unit)and a construction
management team of 10 to oversee the $55M water system rehabilitation program
currently underway. The net savings across all funds related to these personnel
adjustments is $529,300 with $512,600 being in the General Fund.
Building Permits Growth
In October 1999, the building, electrical, plumbing, gas and mechanical permit fees were
increased to reflect the fee schedule in Appendix"B"of the 1997 Standard Building Code.
The new permit fee schedule became effective on December 1, 1999. The Fiscal Year
2001 anticipated revenue from permit fees was $671,000. Actual revenue from building
related permit fees in Fiscal Year 2001 was $925,170.
The total anticipated revenue in Fiscal Year 2002 from building related permit fees were
estimated at $807,000. With fifty-eight (58) percent of the fiscal year complete,
approximately$669,650 in revenue has been generated from building related permit fees.
It is anticipated that the total amount of revenue generated from building related permit
fees for Fiscal Year 2002 will total $1,144,000. This represents a forty-four (44) percent
increase in anticipated revenue. A breakdown by permit type reflecting the budgeted
revenue amount,the revenue to date and the year end revenue estimate is provided below
for Fiscal Year 2001 and Fiscal Year 2002.
Fiscal Year 2002 Bui ding Related Permit Revenue
Estimated Year
Permit Type Revenue Estimate Revenue to Date End Revenue
Building $300,000 $310,000 $530,000
Electrical 50,000 26,800 45,000
Plumbing 20,000 22,800 39,000
Gas 7,000 4,050 7,000
Mechanical 30,000 25,000 43,000
Other* 1 400,000 281,000 480,000
Totals $807,000 $669,650 $1,144,000
Fiscal Year 2001 Building Related Permit Revenue
Permit Type Revenue Estimate Year End Revenue
Building $250,000 $469,651
Electrical 55,000 37,797
Plumbing 30,000 28,445
Gas 6,000 7,548
Mechanical 30,000 28,249
Other* 300,000 1 353,480
Totals $671,000 $925,170
*Misc. Permits for Signs, Oil Wells, Fire Alarms, Sprinklers, Swimming Pools and
Driveways
Increased Employee Safety - Containing Worker's Compensation Costs
Based on Best Practices as reported in Workers Compensation and Human Resources
publications, an aggressive program which monitors the safety of the work environment,
trains and rewards employees; as well as actively seeks out the best care for injured
workers, serves as the most effective cost-containment program in which an organization
can invest.
In the past,the City's Safety Pays program rewarded departments whose employees have
achieved an inordinate number of work weeks without an accident and/or individuals who
demonstrate success from a new personal health regime. Beginning in January, 2002, a
new program was initiated to reward individual and team efforts to improve health and
safety. This program, called the "Goodwill Games", has events that are scheduled
throughout the year. These activities include: health screens and meetings, golf, bowling,
basketball, billiards, board games(checkers, dominos, backgammon), volleyball, softball,
tennis, turkey shoot/archery tournament, aerobics marathon, table tennis, weight lifting,
bingo, and a fishing tournament.
As a self-insured municipality, the City is entitled to submit a notice of subrogation for any
settlement made with an injured City of Beaumont employee from a third party that is
responsible for the injuries. As in the past, during fiscal year 2002,the City is aggressively
seeking out opportunities to recoup a portion of its Worker's Compensation costs through
subrogation. A combination of subrogation efforts and refunds resulted in payments back
to the Workers' Compensation account in the amount of$146,295.
Fire Training Center Progress Report
FY 2002 is the second year of the Training Center's five year strategic action plan. The
goals for the facility included:
♦ addressing safety concerns at the BASF, Industrial Complex and Pressure Manifold
projects;
♦ avoiding potential environmental problems due to leaks at the Storage Tank project;
♦ classroom renovations at the Rescue and Sprinkler Systems projects;
♦ upgrading the flow capacity from the north sump to the separator system;
♦ refurbishing instructor sheds and piping on the south side of the fire field.
The secondary stairway at the BASF project was determined to be too steep posing a
tripping hazard. The stairway was rebuilt to conform to OSHA standards. A center railing
was installed on the Industrial Complex project to insure the safety of students entering
the project's stairways.A solution to the slipping hazards created by algae formation at the
Industrial Complex and Pressure Manifold projects has not been determined to date.
Leaks in the bottom of the Storage Tank project placed it out of service for environmental
reasons. Williams Fire and Hazard Control, Inc. adopted the Storage Tank project and
funded the$8,250 refurbishment of the tank bottom to correct the problem.The project was
placed back in service in March, 2002.
The old "Dome Room" was converted into a second classroom at the Rescue Project.
Improvements included correcting a water seepage problem into the room during periods
of heavy rain by installing a french drain, rebuilding the pea gravel rappelling pad, and
adding fresh paint, window coverings and audiovisual equipment. Other classroom
renovations include demolition of the systems cubicles in the Sprinkler building to convert
the space to an additional classroom.The demolition was completed in February, and with
available funding, renovations will begin this summer.
The addition of the BASF project last year has increased the water flow to the north sump.
To handle the additional flow, larger 6" sump pumps are being installed. The system will
be hard piped from the sump to the separator and will require upgraded electrical systems
to accommodate the larger pumps. A vault across the back road is being constructed and
installation of the pipe supports have been completed. The project is scheduled for
completion in June, 2002.
The instructor sheds and piping have been refurbished on the South side of the fire field.
Piping is being sandblasted and painted, and the Instructor Sheds have new metal roofs
and chalk boards. Piping is now color coded to indicate the type of fuel or water running
through the lines. Marking of the valving will occur this summer.
BAD NEWS
Industrial Payments FY 2003
Due to the one time payment received from ExxonMobil in FY 2002, industrial payments
are projected to decline by 2.62% or $322,000 in FY 2003. This assumption includes an
approximate increase in assessed value of 2% applied to all industries. Industries in
Beaumont, along with others across the United States, have felt the impact of a declining
economy that was exacerbated by the events of September 11, 2001. Administration
remains optimistic that these companies will hold steadfast during these trying times and
assessed values will not be adversely impacted.
Proposed Expansion of Sales Tax Holiday
The State of Texas is once again considering increasing the types of items exempt from
taxation and the number of days of the sales tax holiday. Although specific information is
not available relative to the amount of revenue lost during the holiday, an expansion of the
holiday is expected to have a negative impact on an already struggling revenue source.
Rising Cost of Property Insurance
A 150% increase in the premium for property insurance was not expected last budget year
but due to unexpected events during the past year, the City, like all other policyholders,
must bear the burden of increased premiums.
Nationwide increases in cost for insurance began in early 2001 because of a declining
stock market. In June 2001, Tropical Storm Allison caused extensive damage in the Gulf
Coast region and millions of dollars in insurance claims. The insurance market incurred
billion dollar losses after the destruction of the World Trade Center.All of these factors are
negatively affecting insurance rates for both the public and private sector.
Property insurance for City facilities includes fire,flood and windstorm protection.The total
building value is approximately $103,069,932. Deductibles were increased last year to
reduce cost and are currently $100,000 for fire and flood and $250,000 for windstorm.
The new policy, provided by the Texas Municipal League Intergovernmental Risk Pool, is
for a one year period that began May 1, 2002. The total cost is $359,009, an increase of
$217,460 from the previous year's policy.
Appraised Values Lower than Expected
Preliminary 2002 appraised values were received from the Chief Appraiser May 15, 2002.
Net appraised value after applying exemptions and abatements is $3,984,789,183. This
is an increase of 1.95% over the 2001 certified tax roll.
It is important to recognize that this is only a preliminary estimate. The appraisal records
will be reviewed by the appraisal review board and they will hear and determine all tax
payer protests on these values. Once the appraisal review board process is complete, the
final roll will be certified by July 25, 2002.A five year average shows the July 25'certified
roll, after disputes are resolved, is approximately 1% less that the preliminary value. If this
holds true for this tax year, the increase would be reduced to about 1%.
The Long Range Financial Plan projected an increase of 3% in appraised values. The
impact of the actual preliminary values to the General and Debt Service Funds will be a
reduction in projected revenue, including the allowance for disputed values, of
approximately $250,000 in each fund. Approximately $0.0131 of property tax would be
required to generate this additional $500,000 required in both funds. An FY 2003 penny
equals $380,000.
Sales Tax Receipts
As of May 2002 sales tax revenue received year to date is $15.8 which is $228,000 or
1.4% below budgeted levels. April and May collections were less than 1% higher than the
same periods last year and February and March were 1.4% and 8.5% below.
Administration is cautiously optimistic that future collections will be representative of the
economic growth being experienced throughout the City.
Increased Transit Operating Costs
Operating costs for the Beaumont Municipal Transit system have increased due to fuel
costs, age of the fleet and employee wages. The FY 2002 budget provided, through a
transfer from the General Fund, an operating subsidy of $767,500 as well as $250,000
for capital match. At the time the FY 2002 budget was prepared, the state subsidy was
estimated at $420,000, however the final contract amount was $525,000.
The budget reconciliation plan implemented in FY 2002 included reduced operating hours
in the form of longer mid-day head times and a fare increase of $0.25. The proposal to
recover costs through charges to social service agencies amounting to approximately
$100,000, has not been realized.
Revised projections indicate potential under-funding of approximately $100,000. This
deficit, if realized, would be recovered through an increased transfer from the General
Fund.
ALTERNATIVE COURSES OF ACTION
2002 BUDGET SUMMIT
FINANCIAL AND BUDGETARY CHALLENGES
In order to meet the increasing challenges of reduced or limited funding and increased citizen
expectations for service, the City is exploring ideas to reduce cost, generate revenue and increase
service quality.
It is important to match the taxes and fees that the public is willing to pay with the cost of services
that the public demands. The Administration's efforts to Rightsize,as opposed to downsize,a service
cost means having the right number of people with the right kind of skills and training, the right
amount of supplies and just the right amount of physical plant and equipment to provide the service
properly.
"If you downsize,you're cutting costs but you're not fixing
fundamental problems."
- W. Edwards Deming
Before any organization attempts to Rightsize its efforts, it should ask the following
questions:
• Does the activity fit the organization's strategic plan?
• Does the activity produce more value for the customer than it consumes in
resources?
• If not, why is the organization doing this?
Crucial to all downsizing or rightsizing efforts is deciding on what the organization does
well. Rational resource allocation simply means putting scarce resources to good use.
Government activity should produce more value than it consumes.
"Unless we change our direction, we are likely to end
up where we are headed."
-Old Chinese Proverb
To meet the financial challenges of FY2003, the City must consider changing the
fundamental way government operates. This process of change involves new directions -
• Empowerment of Neighborhoods in Decisions Allocating Resources
• Ensure Competition In Service Delivery
•
Government Focus on Mission/Values
• Results-Oriented Government — Funding Outcomes, Not Inputs
• Meeting the Needs of the Customer, Not the Government
• Creating Revenue Rather Than Spending Opportunities
• Anticipate — Focus on Prevention Rather Than Correction
• Increased Employee Participation and Teamwork
The City needs to move beyond the basic improvement of an existing process. What must
occur is a fundamental change to an existing process or eliminating it totally. Therefore,
Council and Administration must provide the necessary leadership if significant changes are
to be made to provide the most efficient and cost effective services to our customers.
A process to analyze service effectiveness provides Council with various policy options:
• Provide services differently or at a different service level
• Raise revenue (fees and/or taxes)
• Ask for understanding for a declining City and reduced service levels
An Administrative analysis of services and programs provides significant cost savings for the
long-term financial stability of the City by:
• Determining services to be eliminated
• Identifying subsidies to be reduced or discontinued
• Determining appropriate service levels focusing the organization on mission,
encouraging an entrepreneurial spirit throughout the organization
COMPETITIVE GOVERNMENT
INJECTING COMPETITION INTO SERVICE DELIVERY
• Most obvious advantage of competition is greater efficiency or more bang for the buck.
• Competition forces public or private monopolies to respond to the needs of their
customers.
• Competition rewards innovation; monopoly stifles it.
• Competition boosts the pride and morale of public employees.
• Competition must be carefully structured and managed, if it is to work...unregulated
markets generate inequity.
PRIVATIZATION TECHNIQUES
Service Shedding. A form of total privatization in which government stops providing a
service entirely.
Contacting Out. The City contracts with a private organization, for profit or nonprofit, to
provide a service.
Public-Private Competition. Public in-house units compete against private firms to provide
a public service.
Franchise. A private firm is given the exclusive right to provide a service within a certain
geographical area for a limited time.
Vouchers. Government provides individuals with certificates redeemable for purchase of
a good/service on the open market.
Subsidy. The producer of the service is subsidized by the government contributing
financially or in-kind to a private organization to reduce the cost of private provision of
service to consumers.
Internal Markets. Government departments are free to purchase services from either the
private sector or internal support units.
Asset Sale or Lease. Government sells assets such as airports, utilities or real estate to
private firms, thus turning physical capital into financial capital.
Volunteers. Volunteers are used to provide all or part of a government service.
Self-Help. Community groups and neighborhood organizations take over a service or
government asset such as a local park.
Private Infrastructure Development. The private sector builds, finances and/or operates
infrastructure such as roads and airports, recovering costs through user charges.
Deregulation. Government regulations are eliminated to allow private providers to compete
against a government provider; for example, allowing firms to compete with the U.S. Postal
Service.
The following are critical activities to support a process of financial renewal and
revitalization:
• Create a mission and shared vision of the community and organization.
• Embrace the primary values of the organization.
• Mayor/Council sets strategic goals and objectives.
• Mayor/Council sets priorities and eliminates programs that do not support the mission
of the City.
• An effort is made to reduce organizational layers as part of streamlining the
administration.
• All non-essential work that does not provide value to the customer is eliminated
through improving work processes.
• Implement a quality improvement/customer service perspective.
• Emphasize performance measures for all services areas.
• Explore alternative service delivery approaches.
• Create meaningful opportunities for citizen involvement.
• Communicate the results of the process to the organization employees and
community.
• Celebrate the success achieved!
ORGANIZATION GUIDELINES
• Is it the right thing for the community and organization?
• Is it the right thing for the department?
• Is it ethical and legal?
• Is it something you are willing to be accountable for?
• Is it consistent with the organization values and policies?
When the answers to all ofthe above questions are yes,the guidelines state"just do it"without asking
for permission or forming a committee to decide. This is direction that encourages employees to
think; and when employees think, they can respond with flexible, innovative solutions and services
for their customers.
The funding strategies to be utilized focus on the following areas:
• Preserve and enhance the capital improvements program and planning process.
• Commit to not substituting City funding for reductions in state or federal funding
programs.
• Reduce personnel positions by attrition when feasible.
• Identify best practices through benchmarking- search for best practices that lead to
performance;and become the standard against which the local government compares
itself.
• Survey citizens to understand demands and expectations for service.
• Emphasize user fees as opposed to increase in taxes.
• Maintain a reasonable fund balance.
• Develop productivity initiatives and gain-sharing with departments that are successful
in reducing costs while maintaining or increasing service quality.
• Initiate a trust fund to encourage and facilitate private sector donation.
• Institute an aggressive program to procure federal/state grants to address identified
priorities to the City.
"The only person who likes change is a wet baby."
-Roy Z.M.Bliurr
There are other important aspects to an improvement process that Mayor and Council need to
consider prior to a major commitment.
• To be successful,long-term financial forecasting and planning is essential. However,
unexpected and unpredictable events can and will occur to impact any forecast no
matter how well prepared.
• The Mayor, City Council and Administration need to commit to the process and its
potential outcome.
• A major improvement process can't be accomplished in one or two years.It is a long-
term commitment and a basic rethinking of the fundamental mission on how
government provides service.
• It is important to solicit community understanding and involvement as the process
proceeds into reducing or eliminating programs and reviewing fees for services.
• A commitment must be made to enhance volunteer programs and public/private
partnerships in order to maintain existing levels of priority services.
• A renewed commitment is necessary to education and training to lead and change the
organization.
• Sufficient time must be spent on communicating openly through focus groups, staff
meetings,public forums,citizen newsletters and other strategic sources ofinformation
that can be identified.
"There is nothing more difficult to take in hand,
more perilous to conduct... than to take the lead in
the introduction of a new order of things."
-Niccolo Machiavelli,"The Prince"
IDEAS THAT SAVE COSTS AND INCREASE REVENUE/SERVICE QUALITY
Mayor/Council and Administration are agents of change. Change requires a driving force
and the most powerful change agent is financial stress. The City of Beaumont must make
major changes in the operation of government if financial stability and quality services are
to be continued.
The implementation of a portfolio management tracking system to monitor
taxes, water, sewer and other City assessments will result in increased
revenues received in a more timely manner.
The City should aggressively sell assets - land, buildings, equipment to the
extent possible in order to turn underutilized physical capital into financial
capital and produce tax benefits.
Privatization of public services should be considered through a competitive
process with City employees when contracting provides a clear advantage
on cost savings and service quality. While the private sector can be an
effective agent for delivering public services, the responsibility for providing
services - determining the scope, level and conditions under which they are
delivered remains with City officials committed to the public interest.
Management improvement efforts many times focus on how to do unimportant
things cheaper. Instead, as City leaders we should ask- "should we be doing
this at all?" City government should limit activities to core functions and
missions. Does the City activity/service provide more value for the customer
than it consumes in resources? Is the service essential? Is the private sector
already providing the service or if not, is it capable of doing so better than
government? Does the program displace voluntary community or
neighborhood networks? This approach must be applied to all service areas
with the intent to eliminate activities that don't meet the criteria.
The City Council and City Manager meet quarterly with the Beaumont
Independent School District to discuss common issues and priorities. The
Council and Manager also meet quarterly with the Chamber of Commerce and
all Beaumont governmental entities for the same reason. Programs, services
and taxpayer facilities should be identified for better coordination and use.
For example, the City and BISD could expand use of joint facilities for
recreational programs.
Institute energy management program through public/private partnership to
retrofit City facilities with capital costs paid from energy savings over time.
Develop Government business opportunities to market products or services to
other public agencies, e.g. the "webber" back-flow device for toilets.
Solicit private sponsorship of public facilities such as the Civic Center.
Proposals would be solicited from the business community for naming rights
for an annual fee for a 20 year term.
Use of Fund Balance to address revenue shortfalls or unexpected expenses.
This is a short term solution that has negative consequences long term if the
fund balance is depleted.
Establish an employee incentive program to enhance morale,productivity and
cost savings. The program will provide monetary incentives to employees
exceeding departmental goals and budget targets. The program is based on the
following:
Incentive is based on performance measures through budgetary savings
Incentive is not related to performance evaluation system
It is department and program based not individual based
Each department has a mission statement and performance measures;
incentive comes if the department meets performance measures;partial
accomplishments are recognized as well
Capital outlays/improvements, insurance and professional fees are not
included
50% of savings is returned to general fund, 50% is shared equally
among employees generating the savings.
Reduction in number of Fleet vehicles.
Outsourcing City Internal Services.
Elimination/Transfer of Service Responsibility.
Adjust Service Levels.
Discontinue or Reduce Subsidy of Programs/Services.
Subsidize Transfer of Service.
Encourage Volunteer/Non-Profit Participation in Service Delivery.
Private Infrastructure Development.
Establish Trust Opportunities for Private Donations.
Improve Effectiveness of Collection Process of City Fees.
ENGAGING CITIZENS IN THE BUDGET PROCESS
Why should a city market their budget?
• The annual budget process is an opportunity to dialogue with citizens regarding
community goals and priorities and to create public support.
How can the City involve the community in the budget process?
• Neighborhood meetings
• Citizen survey (PAFR distribution)
• Website
• Newsletter (water bill distribution)
• Channel 4 (local government access)
Relying on the public hearing process is in most cases "too little, too late" to involve a
significant number of participants. It is desirable to inform and educate the public so that
they might understand the "budget process" but this is often "one-way," not two-way
communication.
Focus of Public Discourse
Informing Citizens Engaging Citizens
One-Way Two-Way
Telling/Selling Listening/Responding/Listening
Education Learning
Presenting Information Eliciting values,hopes, aspirations,
concerns
Discerning"Public Opinion" Promoting"Public Judgement"
Citizen Participation
FY 2003 Budget
Jun 10 Budget Summit
Aug 8 * Financial Improvement Team
Aug 13 Submission to Council of Proposed Budget
Aug 14 * Ward III - Martin Luther King Middle School
Aug 19 '` Ward I - MCFeddill Ward HODS@
Aug 21 * Ward IV - Theodore Johns library
Aug 26 * Ward II - Forest Park Methodist Church
Sep 10 * Public Hearing - City Hall
Sep 17 * Adoption of Budget, CIP, Tax Rate
* Dates are tentative
LONG -RANGE FINANCIAL PLAN
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City of Beaumont
April 1, 2002
To the Honorable Mayor and Councilmembers
INTRODUCTION
The Long-Range Financial Forecast, the Capital Improvement Program and the Annual
Budget, combine to form the basis of the annual budget process for the City of
Beaumont. The first report, the Long-Range Financial Forecast, is presented to Mayor
and Council prior to April 1 each fiscal year. The forecast is prepared to assess the
City's current financial condition and project that position ten years into the future
utilizing current policies, trends and assumptions, while maintaining the existing levels
of City services. The Capital Improvement Program and Annual Budget provide
increasing levels of detail and analysis.
The impact of the Long Range Financial Forecast will be reviewed during the 2002
Budget Summit mid May in preparation of the fiscal year 2003 Annual Budget. The
City's fiscal year encompasses the period from October 1 to September 30.
GENERAL GOVERNMENTAL FUNDS
General governmental funds include the General Fund and Debt Service Fund. The
General Fund accounts for the fundamental operating costs of most city departments.
The Debt Service Fund is used to record the resources received to retire the
outstanding debt obligations which are secured by taxes levied by the City.
Finance Department • (409) 880-3789 • Fax (409) 880-3132
P.O. Box 3827 • Beaumont, Texas 77704.3827
General Fund Revenues
The majority of revenues recorded in the General Fund are derived from Sales Tax,
Property Tax, Industrial Payments and Gross Receipts Tax. The following illustrates the
proportion of each source for FY 2002.
General Fund Revenues
by source
37.7% Sales and use tax
17.2% Property taxes
11.6% Other
17.3% Industrial payments 7.2% Utility in lieu
8.9%Gross receipts tax
$70,953,500
The forecast of revenues is based on several assumptions.
Sales and use tax is projected to increase slightly in FY 2002 to $26.8M which is the
original budget amount. Administration has been reporting to Council monthly
regarding this revenue source in light of the events of September 11. At this time it is
expected that these revenues will be realized. The remaining years of the long range
forecast project annual increases of two to three and one-half percent providing
increasing additional revenue of between $500,000 - $1.1 M annually.
Property taxes represent $12.2M of total General Fund resources, at a tax rate of
$0.31 per $100 of assessed value. Estimates for this revenue source assume the
potential for growth in assessed value at a range of 2.5% - 3%. Positive economic
conditions related to the construction of several new retail centers, the Entertainment
Complex and downtown improvements support increasing assessed values in future
years. With no change in the tax rate proposed, revenues are estimated at $12.6M in
FY 2003. This is an increase of 3% from FY 2002 estimates. The forecasted increase in
assessed value will drive the increased property tax revenues for FY 2003.
In fiscal years 2004, 2006, 2008 and 2011 the anticipated reduction in existing debt
service requirements would allow for a reverse shift in the dedication of the tax rate
from the Debt Service Fund to the General Fund. However, the issuance of$9M in
certificates of obligation is proposed in the fall of 2002 to fund current and critical need
projects. If authorized, a reverse shift from debt service would not be feasible until
2
fiscal year 2006 at which time one cent would equal approximately $425,000. Based on
the assumptions of this plan, an estimated $0.045 would be available at that time.
Industrial payments account for approximately $12.3M. The reduction of 2.5% for FY
2003 is a result of a one-time payment received from ExxonMobil in FY 2002. Current
contracts were negotiated in FY 2002 and have a seven year term. The most significant
contract is with ExxonMobil followed by duPont and Goodyear. These industries
combine to provide 75% of the existing industrial payment revenues. The average
growth rate for projections beyond FY 2003 is 2%, which like the property tax, is
predicated on positive economic conditions and growth in assessed values.
Gross receipts taxes (franchise fees), collected from utility companies operating
within the City, are estimated at $6.4M for FY 2002, a decrease of 10.8%. This
decrease is attributable to the return from extraordinary natural gas prices and higher
usage during FY 2001. Based on current known conditions and trends, these revenues
are projected to increase 2% annually for the foreseeable future. Entergy is the lead
contributor of gross receipts tax and is the most sensitive to fluctuation. Utility rate
reductions and lower usage directly impact the receipt of these taxes by effectively
reducing the "gross receipts" on which the tax is based.
Overall, an average 2.2% growth rate is projected for in General Fund revenues for the
10 years in this forecast.
Total General Fund Revenues
100
80 ......................................_.............._................................................................... ... ... ... .......
60 ... ... ... ... ... .......
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20 ... ... _. .......
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Fiscal year
®Sales and use tax w Property taxes ❑Industrial payments
O Gross receipts tax ®Utility in lieu ❑Other
3
General Fund Expenditures
The basic costs of operating the City are charged to the General Fund. These
disbursements provide for Police; Fire; Public Works; Health, Culture and Recreation;
Central Services; and General Government.
Current assumptions maintain existing services at FY 2002 staffing levels, contractual
salary increases for civil service personnel (estimated for fire civil service as contract is
in negotiation) and an annual salary adjustment of 3% for civilians. For this report,
funding limitations predicated the exclusion of future salary adjustments associated
with the Classification Compensation plan which began in FY 2001.
Transfers, reflecting those charges related to dependent healthcare, workers
compensation, the cost of liability claims and lawsuits, facility renovation and the transit
subsidy, are anticipated to increase $177,000 for FY 2002. This change reflects an
increase of$229,000 for dependent healthcare and 180,000 for the transit subsidy.
These increases were offset by decreases in the transfer to Capital Reserve of
$200,000 and General Liability, $100,000. Future increases in this category are most
significantly related to dependent healthcare which is projected to impact the General
Fund by over $500,000 annually.
Total expenditures are expected to grow an average of 2.5% annually throughout the
projection period.
General Fund Expenditures
by category
FY 2001 FY 2002 FY 2003
Actual Estimated Projected
Wages $41,284,435 42,523,400 43,586,000
Benefits 8,520,202 9,094,400 9,252,900
Other Operating 14,028,657 13,483,700 13.536,000
Total Operating 63,833,294 65,101,500 66.374,900
Dependent Healthcare 4,080,259 4,309,500 4,903,500
Workers Compensation 822,000 895,000 901,000
Capital Reserve 500,000 300,000 300,000
General Liability 300,000 200,000 250,000
Transit Subsidy 845,000 _1,020.000 _1,200,000
Total Transfers 6.547.259 6,724,500 7.554,500
Total General Fund $70,380,553 71,826,000 73.929,400
4
Fund Balance
For the fiscal year ending September 30, 2002, the City will maintain a fund balance in
the General Fund of 9% of expenditures. It is projected, based on current
assumptions, that by FY 2003, the level will fall seriously below the goal of 8-10%
and end the year with a fund balance equal to 5.9% of expenditures. Using
projected levels of revenues and expenditures, it is anticipated that the FY 2005 fund
balance will fall into a deficit position.
Storm Water Utility
The creation of a Storm Water Utility to capture the rising costs associated with the
Environmental Protection Agency (EPA) storm water runoff requirements continues to
be considered a viable and prudent solution to this unfunded mandate. If implemented,
approximately $2.6M in General Fund costs related to storm water would be recovered
by a fee charged by the Storm Water Utility. This revenue source could effectively
provide relief to General Fund resources which could then be directed to other uses. It
would also serve to sustain General Fund fund balance at a level that is sufficient to
meet policy guidelines.
Debt Service Fund Expenditures
The major source of revenue recorded in the Debt Service Fund is property taxes.
Currently, a rate of$0.325 is applied to each $100 in assessed valuation. As noted in
the General Fund discussion, the rate of growth for assessed valuation is estimated to
range from 2.5% to 3% during the term of this forecast.
In order to fund the ongoing Capital Improvement Program (CIP), debt issues of$9M in
August 2002 and $8M August 2003 are proposed. The first issue would provide the
resources to complete projects classified as current in the FY 2002 CIP and fund
critical need projects. The next issue would allow for the continuance of the capital
program. A dynamic document, the projects in the CIP are reviewed, prioritized and
approved annually by Mayor and Council.
Debt Service Requirements
Existing and Potential
20
.............................................................................................................................................................................................
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Fiscal Year
ED Existing Debt Service Requirements p Potential$9M-August 2002
® Potential$8M-August 2003
5
The effect of debt service related to the proposed August 2002 $9M issue will be
realized beginning FY 2003 with interest only payments projected for year one and two.
The anticipated FY 2003 $8M issue is also projected with interest only payments in the
first two years, beginning in FY 2004.
The debt service policy calls for 20% of principal and interest requirements as an
adequate level of fund balance. FY 2001 and 2002 are slightly below policy at 18% and
18.5% respectively. With no increase in the tax rate projected, fund balance will fall to
17.1% at fiscal year end 2003 specifically related to the anticipated 2002 $9M issue.
Additional revenue of$200,000 in FY 2003 would be adequate to maintain the fund
balance at the FY 2002 level of 18.5%. Equating to an increase in the tax rate of
$0.005, this could be achieved by either increasing the total tax rate or shifting this
amount from the dedicated General Fund rate. A $0.0005 increase will adequately
provide for debt services payments related both issues addressed in this report.
Based on these assumptions, the capacity exists to issue new debt or shift a portion of
the tax rate dedicated to Debt Service to the General Fund in fiscal years 2006, 2008
and 2011.
INTERNAL SERVICE FUNDS
Internal Service Funds account for common charges to all departments. Risk
management for claims and lawsuits are recorded in the General Liability Fund. The
Employee Benefits Fund includes all health benefits, worker's compensation and
unemployment charges. Equipment and vehicle purchase, as well as building
renovations, are charged through the Capital Reserve Fund. These charges are
recorded proportionately in individual departments, per employee or by equipment. The
funding sources for these funds are through charges and/or transfers from other funds.
Employee Benefits Fund
Funded through charges and transfers from other funds, the Employee Benefits Fund
has no independent revenue source other than employee contributions, which provide
approximately 12% of the revenues in this fund. For FY 2002, the City raised it's
contribution toward health benefits from $6,100 per employee to $6,650, which is
driven by the rising cost of the employee health plan and prescription program. The
employee rate for dependent coverage was increased $12 per month, effective January
2002, to further offset rising costs. Current contribution levels will result in a fund
balance for FY 2002 of$1.6M. An increase in the City's contribution of $550/employee
is included in this forecast for FY 2003. The approximate amount of claims that have
been incurred but not reported in the indemnity plan, coupled with the reserve
requirements necessary to fund incurred workers compensation claims, dictate a level
of fund balance of approximately $1.3M. Based on these assumptions, the projected
level of contributions will be sufficient to provide adequate coverage.
6
Capital Reserve Fund
Originally created to provide for the replacement of equipment and vehicles, the Capital
Reserve Fund also exists to provide for the renovation of public facilities that are not
major capital improvements. It is anticipated that expenditure levels will be reduced and
available fund balance will be utilized during the first several years of the projection
period. The ending fund balance in FY 2003 is projected at $530,000. This will drop to
a projected low of$440,000 in FY 2004.
General Liability Fund
Initiated in FY 1987, the General Liability Fund is the central repository for the payment
of claims, lawsuits and the professional services related to the defense of claims made
against the City. With an estimated liability for claims and lawsuits slightly under $1 M, it
is projected that adequate resources will be available through this projection period.
The sole funding source for the General Liability Fund is transfers from other funds.
SUMMARY
In summary, administration's assumptions include average general revenue increases
of 2.2%. Projections for General Fund operating expenditures show an increase 2.5%
annually for personnel, with other operating costs remaining relatively flat. This
increase is expected to maintain the same level of service. Based on these revenue
and expenditure assumptions, fund balance is expected to drop seriously below policy
levels in FY 2003, with a deficit fund balance anticipated by fiscal year end 2005.
The Debt Service Fund will require an additional $200,000, approximately one half
cent, in FY 2003 to cover existing requirements. This could be achieved by either
increasing the total tax rate or shifting this amount from the dedicated General Fund
rate. Notwithstanding the issuance of new debt, beginning in fiscal year 2004, the
capacity exists to reverse shift a portion of the Debt Service dedication to the General
Fund. If authorization is granted for the $9M issue, the reverse shift would be deferred
to FY 2006.
Internal Service Funds, including Employee Benefits, Capital Reserve and General
Liability, are dependent on service charges and transfers from other funds to service
the claims and purchases recorded therein. Sustaining sufficient fund balances will
require an increased contribution in the Employee Benefits Fund.
Tables are attached for each of the funds discussed. The information provided is
organized so that a brief historical perspective may be gained as well as a forecast
studied, which is based on current known conditions and historical trend analysis.
Reports to Council will be made as needed should future developments occur that
significantly impact the City's financial condition.
Respectfully submitted,
Stephen J. Bonczek
City Manager
7
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
General Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY_2009 FY 2010 FY 2011
REVENUES
Sales and Use Tax $ 26,180 26,752 27,287 27,833 28,668 29,528 30,414 31,478 32,580 33,720 34,900
Property Taxes 12,521 12,213 12,579 12,893 13,215 13,545 13,884 14,231 14,587 14,952 15,326
Industrial Payments 11,267 12,306 11,985 12,215 12,215 12,445 12,680 12,920 13,165 13,420 13,670
Gross Receipts Tax 7,115 6,350 6,477 6,607 6,739 6,874 7,011 7,151 7,294 7,440 7,589
Utility Fund In Lieu 4,250 5,100 5,100 5,200 5,200 5,300 5,300 5,400 5,400 5,400 5,400
Other - 7,437 8,233 8,315 8,398 _ 8,482 8,567 8,653 8,740 8,827 8,915 9,004
TOTAL REVENUES 68,770 70,954 71,743 73,146 74,519 76,259 77,942 79,920 81,853 83,847 85,889
EXPENDITURE CATEGORY
Wages 41,285 42,523 43,586 44,676 45,793 46,938 48,111 49,314 50,547 51,811 53,106
Benefits 8,520 9,095 9,253 9,416 9,583 9,754 9,929 10,109 10,293 10,482 10,675
00 Other operating 14,029 13,484 13,536 13,657 13,779 13,922 14,046 14,172 14,299 14,447 14,576
Total Operating 63,834 65,102 66,375 67,749 69,155 70,614 72,086 73,595 75,139 76,740 78,357
Dependent Healthcare 4,080 4,309 4,903 5,437 5,966 6,387 6,834 7,296 7,790 8,316 8,860
Workers Compensation 822 895 901 907 912 918 924 905 911 918 924
Capital Reserve 500 300 300 300 300 500 500 500 500 500 500
General Liability 300 200 250 250 250 250 250 250 250 250 250
Transit Subsidy 845 1,020 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200
Total Transfers Out 6,547 6,724 7,554 8,094 8,628 9,255 9,708 10,151 10,651 11,184 11,734
TOTAL EXPENDITURES 70,381 71,826 73,929 75,843 77,783 79,869 81,794 83,746 85,790 87,924 90,091
EXCESS(DEFICIT) REVENUES
OVER EXPENDITURES (1,611) (872) (2,186) (2,697) (3,264) (3,610) (3,852) (3,826) (3,937) (4,077) (4,202)
FUND BALANCE
Beginning Fund Balance 9,015 7,404 6,532 _ 4,346 1,649 (1,615) __L,225) (9,077) X12,903) (16,840) (20,917)
Ending Fund Balance $_ 7,404 6,53.2 _-4,346 1,649. (1,61.5) (5,225) (%077) (12,903) (16,840) -A20.917) (25,119)
CITY OF BEAUMONT
LONG RANGE FINANCIAL FORECAST
Debt Service Fund
(In thousands)
Actual Estimated Projected Projected Projected Projected Projected Projected Projected Projected Projected
FY 200_1_ FY 2002 _FY_2.003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
REVENUES
Property Tax Revenue $ 11,507 12,675 12,991 13,308 13,644 12,085 12,379 7,379 7,566 7,747 6,981
Interest Earnings 241 240 204 200 230 270 258 259 237 219 213
Miscellaneous Revenue 839 1,027 1,034 1,099 1,148 1,153 1,155 1,154 1,232 1,232 1,237
TOTAL REVENUES 12,587 _ 13,942 14,229 14,607 15,022 13,508 13,792 8,792 9,035 9,198 8,431
EXPENDITURE CATEGORY
Principal&Interest(P& 1 13,135 13,716 13,772 13,447 13,458 12,169 12,115 7,554 7,701 7,671 6,835
P & I-anticipated issues -- -- 537 997 1,251 1,546 1,640 1,640 1,640 1,640 1,640
Service Charges 9 10 10 10 10 10 10 10 10 10 10
TOTAL EXPENDITURES 13,144 13,726 14,319 _ 14,454 14,719 13,725 13,765 9,204 9,351 9,321 8,485
EXCESS (USE)OF FUND
BALANCE (557) 216 (90) 153 303 (217) 27 (412) (316) (123) (54)
FUND BALANCE
Beginning Fund Balance 2,880 2,323 2,539 2,449 _ _2,602 2,905 2,688 2,715 -2,303 1,9V _ 1,864
Ending Fund Balance $_ 2,323 2.539. 2449 2,602 2,905 2,688_ 2,715 2,303 1 087 1,864 1.810