HomeMy WebLinkAboutCC 2023-08-04 Minutes MINUTES OF THE BUDGET WORK SESSION OF THE
CITY OF NORTH RICHLAND HILLS, TEXAS,
COUNCIL OF THE
HELD AT TARRANT COUNTY COLLEGE, NORTHEAST CAMPUS
828 WEST HARDWOOD ROAD, HURST, TX 76054
AUGUST 4, 2023
Present: Oscar Trevino Mayor
Tito Rodriguez Place 1 (present at 8:27 a.m.)
Rita Wright Oujesky Place 2
Suzy Compton Place 3
Mason Orr Place 4
Blake Vaughn Associate Mayor Pro Tern, Place 5
Scott Turnage Deputy Mayor Pro Tern, Place 6
Kelvin Deupree Mayor Pro Tern, Place 7
Staff Members: Mark Hindman City Manager
Paulette Hartman Deputy City Manager
Karen Manila Assistant City Manager
Caroline Waggoner Assistant City Manager
Alicia Richardson City Secretary/Chief Governance Officer
Maleshia B. McGinnis City Attorney
Mary Peters Communications Director
Craig Hulse Director of Economic Development
Jimmy Perdue Special Project Coordinator
Mark Mills Director of Finance
Trudy Lewis Director of Budget and Finance
Patrick Hillis Director of Human Resources
Stan Tinney Fire Chief
Mike Young Police Chief
Cecilia Barham Director of Library Services
Adrien Pekurney Director of Parks and Recreation
Stefanie Martinez Director of Neighborhood Services
Billy Owens Assistant to the City Manager
Jennipher Castellanos Senior Budget Analyst
A. CALL TO ORDER
Mayor Trevino called the Budget Work Session to order August 4, 2023 at 8:01 a.m.
B. PUBLIC COMMENTS
There were no requests to speak from the public.
August 4, 2023
City Council Budget Work Session
Page 1 of 8
C.1 SUBMISSION OF THE JULY 2023 APPRAISAL ROLL TO THE GOVERNING
BODY
City Manager Mark Hindman gave an overview of the city's budget process. In
accordance with the city charter, the city manager is responsible for preparing and
submitting a proposed budget to the City Council at least 45 days prior to the beginning
of the fiscal year. The city utilizes the citizen survey as a guide when developing the
proposed budget. The results of the survey indicate that citizens are concerned with
transportation. The presentations provided today include the revised 2022-2023 and
proposed 2023-2024 Operating and Capital Project Budgets. The information presented
for the proposed budget includes the base budget and proposed adjustments to the base.
The city is approaching the final year for the 2020 Street Bond Program.The last issuance
is scheduled for 2024. The city's sales tax is projected to increase 2% in 2024 before it
begins to level off. Fine revenues are projected to decrease by $700,000 this year and
staff anticipates a decrease in building revenue compared to the previous year. The city
will see an increase in interest income, and this will be the final year of American Rescue
Plan Act ("ARPA") funding. There is a trend in public safety among the benchmark cities
to address and retain police officers. He shared that the city would see an increase in the
sewer rate from Fort Worth. In looking forward, future issues for the city include growth
slow down, redevelopment/revitalization, labor shortage, and the next bond program.
Council member Rodriguez joined the meeting at 8:27 a.m.
The City Council and staff discussed vacancies, training and recruiting for the police
department, certificates of obligation being included in the city's tax supported debt, and
TEXRail ridership.
Deputy CityManager Paulette Hartmanprovided an overview of the city's
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to date for the police department,
accomplishments and highlighted the servicesprovided ,
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fire department, public works, planning and building inspections, neighborhood services
and parks and recreation, NRH2O and the library. The City Point Development is
underway and the Peppa Pig Theme Park broke ground in June. The redevelopment
Ross/PopShelf/Five Below, Wares pace,
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projects include Volli Entertainment, ,
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Boulevard Café. At the direction of City Council, staff is working on a Neighborhood
Empowerment Zone (NEZ) and Tax Increment Reinvestment Zone (TIRZ) for Boulevard
corridor revitalization.ACode Cou
rt was implemented
2 and Davis Boulevard to facilitate 6p
to address code compliance cases. The city's 2020 Street Bond Program included 27
streets for reconstruction and the city is halfway through the projects. The budget was
increased for preventive street maintenance.
Director of Economic Development Craig Hulse presented an overview of the local
economy. He reviewed city population trends, key economic indicators, local development
trends, existing single-family values, local and commercial real estate trends, and taxable
sales. New retail under construction includes Volli Entertainment located at Rufe Snow
and 820 (west side); Pop Shelf, Five Below and Ross Dress for Less located at Rufe
Snow and 820 (east side); EoS Fitness located at Rufe Snow and Hightower; Seconds &
August 4,2023
City Council Budget Work Session
Page 2 of 8
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Surplus located at Boulevard 26 and 820; Caddo located Davis Boulevard and North
Tarrant Parkway; and Peppa Pig Theme Park located at Boulevard 26 and Harwood.
Director of Finance Mark Mills reviewed the July 2023 Appraisal Roll.The data is provided
by the Tarrant Appraisal District ("TAD") and the Tarrant County Tax Office. The Truth-in-
Taxation calculation cannot be certified until the Certified Roll and Certified Collection
Rate information is presented to the City Council. The information was included in the
Executive Summary provided to the City Council for the Budget Work Session. The
Certified Appraisal Roll for July 2023 specifies $10,744,722,917 for appraised value,
$8,623,319,355 for estimated net taxable value, and $141,009,789 for taxable new
construction. According to the Certified Appraisal Roll, the market for a North Richland
Hills average single-family residence is $383,824. The market is the value established by
TAD. The appraised value for the same single-family residence is $337,091. The
appraised is the value less appraisal caps. The taxable value for the same single-family
residence is $269,976. The taxable value is the appraised value less exemptions
(homestead) and tax ceilings (i.e., senior freeze). He reviewed the certified collection
rates for the years 2020—2022. The city anticipates a 100% collection rate for 2023.The
Certified Roll includes five categories—residential, commercial, industrial, mineral, and
agriculture. Mr. Mills provided a historical overview of the net taxable value for Fiscal
9
Years 2015 — 2024. He reviewed the city'ssingle-family sin le-famil market values for Fiscal Year
2024 (table).
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Mr. Mills stated that the City has a 20% homestead exemption and senior tax ceiling.
Seniors (over 65) and disabled persons will not pay more property taxes unless (i) they
purchased a new home or (ii) they modified (addition) their existing home. Currently, the
city has 6,052 (27.3%) residential accounts with senior tax ceilings and 309 (1.4%)
residential accounts with disabled person tax ceilings.
Mr. Mills provided an overview and breakdown of the total combined tax rate. The current
fiscal year tax rate is $2.406371. The tax rate encompasses the Birdville Independent
August 4,2023
City Council Budget Work Session
Page 3 of 8
School District at$1.2798 (53.2%), Tarrant County and Associated Districts at$0.578599
(24.0%), and North Richland Hills at $0.547972 (22.8%).
The city's property tax rate is the combination of Maintenance and Operations (M&O)
from the General Fund and Interest and Sinking (I&S) from Debt Service. The property
tax cap limits how much properties' taxable value can grow. The property tax cap does
not affect the Debt Service rate. The city's current adopted tax rate is $0.547972, of which
the M&O is $0.347744 and the l&S is $0.200228.
In preparation for the Proposed 2023-2024 Operating and Capital Budgets and Truth-in-
Taxation calculations, staff determines the No-New Revenue Rate ("NNRR") and Voter-
Approval Rate ("VAR"). The NNRR produces the same amount of taxes if applied to the
same properties taxed in both years. The VAR requires an election if the City Council
adopts a rate that exceeds the Voter-Approval Rate.The VAR is determined by calculating
the No-New Revenue Rate and adding 3.5%, any unused increment, and the debt rate
(I&S). The Fiscal Year 2024 No-New Revenue Rate is $0.489389 per $100 of assessed
value and the Voter-Approval Rate is $0.498348 per $100 of assessed value. The
Ij! proposed Fiscal Year 2024 preliminary tax rate is $0.498155, of which the M&O is
$0.322349 and the l&S is $0.175806.
The proposed preliminary tax rate of$0.498155 was used to prepare the proposed Fiscal
Year 2024 General Fund budget. He reviewed the following table showing the change
from Fiscal Year 2023 to preliminary Fiscal Year 2024.
Description FY23 FY24 Change
Adopted Preliminary
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C.2 PRESENTATION OF THE BUDGET AND DISCUSSION OF REVISED 2022-
2023 OPERATING BUDGET AND PROPOSED 2023-2024 OPERATING
BUDGET.
Mr. Mills discussed the Debt Service Fund and reviewed the 2020 Street Bond Program.
The amount issued to date is $43,980,000 and the remaining authorized/unissued bonds
is $5,895,000. He also reviewed the debt service capacity and other tax supported debt
payments.
August 4,2023
City Council Budget Work Session
Page 4 of 8
I'.
Director of Human Resources Patrick Hillis provided an overview of the proposed
recommendations for the compensation and benefits program for 2023-2024. Mr. Hillis
explained the merit, step increases, and pay range movement. The proposed budget for
the general government pay plan includes a merit increase of 3.5% at maximum of the
pay grade and a 2% pay range adjustment, both effective October 1, 2023. The public
safety (police and fire) pay plans include a 4% range adjustment on October 1, 2023 and
additional salary adjustments on April 1, 2023 to move employees through the pay plan.
The city has experienced a good claims year and anticipates coming in under budget for
the Health Insurance Fund, and savings will be moved to the fund balance. The
recommendations for health insurance include a $90.00 reduction for all monthly
premiums, the HRA "employee only" plan will be offered at no cost to an employee, and
an increase in dental and orthodontia cap from $1,500 to $2,000 beginning January 1.
There will be no medical plan design changes.
There was no objection from City Council regarding the proposed pay plans and health
insurance.
Mayor Trevino recessed the meeting at 11:43 a.m.
Mayor Trevino reconvened the meeting at 12:02 p.m., with the same members present.
Director of Budget and Research Trudy Lewis provided an overview of changes to the
revised 2022-2023 General Fund budget discussing significant impacts to revenues and
expenditures. There is a positive balance of $777,858 and staff proposes the following
additions to base - $17,800 drone tether device; $40,000 advanced life support simulator
mannequin; $90,054 city facility AED(s); and $104,922 (2) outdoor warning siren
replacements for a total of$252,776.
Ms. Lewis provided an overview of the proposed 2023-2024 General Fund expenditures
($58,445,762) and revenues ($60,148,295). Revenue highlights include $1.15 million in
property tax ($454,000 in new construction); $363,912 increase in franchise fees;
$1,725,641 increase in sales tax; decrease of$656,396 in court fees and fines; decrease
of $693,167 in licenses and permits; $435,790 increase in charges for service; and
$706,903 interest earnings. Expenditure highlights include $122,479 increase for the new
code court; $265,872 increase for public safety step plan adjustments from mid year
Fiscal Year 2023; $279,872 increase in property and liability insurance; and $166,293 in
capital project transfers. A positive balance of $1,702,533 remains prior to proposed
additions to the base budget.
Mayor Trevino recessed the budget work session at 12:18 p.m.
Mayor Trevino reconvened the budget work session at 12:33 p.m., with the same
members present.
Assistant City Manager Karen Manila reviewed the Utility Fund, to include the revised
2022-2023 revenues ($45,931,308)and expenditures ($44,835,974) and proposed 2023-
August 4,2023
City Council Budget Work Session
Page 5 of 8
2024 revenues ($42,675,352) and expenditures ($41,223,686). A positive balance of
$1,451,666 remains prior to the following proposed additions to the base budget -
$108,474 GIS and asset management technician; $1,250,000 Conn pump station
generator UT2403; and $211,253 merit/market adjustments for a total of$1,569,727. The
remaining balance of$118,061 will be paid from reserves.
Manila reviewed the Drainage UtilityFund. This fund accounts for the monthlyfees
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9
charged to residents and businesses to pay for the cost of drainage improvements
throughout the city. She reviewed the revised 2022-2023 revenues ($2,726,022) and
expenditures ($2,726,022) and proposed 2023-2024 revenues ($1,767,515) and
expenditures ($1,241,754). A positive balance of $525,761 remains, and staff proposes
the following additions to the base budget - $25,000 storm water management program
design consulting fee and $8,219 merit/market adjustments for a total of $33,219. The
remaining balance of$492,542 will be moved to reserves.
Ms. Hartman reviewed the Park and Recreation Facility Development Fund, to include
the revised 2022-2023 revenues ($12,080,687) and expenditures ($9,971,749) and
proposed 2023-2024 revenues ($11,748,652) and expenditures ($10,108,592). The fund
will see an increase in sales tax revenue, interest income, NRH Centre revenue, and Park
Fund Revenues. The fund will see a decrease in appropriation of NRH Center Fund
balance and Park Fund expenditures.A positive balance of$1,640,060 remains, and staff
proposes the following additions to the base budget - $72,158 salary increase for part-
time staff and $125,906 market/merit salary adjustment.
There was no objection from City Council regarding the proposed additions to the base
budget.
Ms. Hartman reviewed the Aquatic Fund, to include the revised 2022-2023 revenues
($4,884,096) and expenditures ($4,978,453) and proposed 2023-2024 revenues
($6,155,626) and expenditures ($5,387,590).
The City Council and staff discussed policy during extreme weather days, locker
equipment, process to receive feedback from guests, retirement celebration of NRH2O
and announcement of the new replacement ride.
C.3 REVISED 2022-2023 AND PROPOSED 2023-2024 CAPITAL PROJECTS
BUDGETS.
Special Project Coordinator Jimmy Perdue reviewed the Fleet Services Fund, to include
the revised 2022-2023 revenues ($6,345,051) and expenditures ($6,281,540) and
proposed 2023-2024 revenues ($4,632,087) and expenditures ($4,549,557). He
highlighted changes in the revised and proposed budgets.
Mr. Perdue reviewed the Facilities Fund, to include the revised 2022-2023 revenues
($3,515,072) and expenditures ($3,615,968) and proposed 2023-2024 revenues
August 4,2023
City Council Budget Work Session
Page 6 of 8
($3,243,135) and expenditures ($3,295,080). He highlighted changes in the revised and
proposed budgets and reviewed proposed additions to the base budget.
Ms. Manila reviewed the Information Technology Fund, which oversees and manages all
technology related items for the city. Revenues for this fund are generated by charges to
city departments. She reviewed the revised 2022-2023 revenues ($5,401,071) and
expenditures ($5,410,428 ) and proposed 2023-2024 revenues ($4,842,773) and
expenditures ($5,010,789). Staff proposes the following proposed adjustment in the
amount of$56,764 for merit/market salary adjustments. The negative ending balance will
be offset with an appropriation from the fund balance.
Ms. Manila reviewed the Self Insurance Fund, to include the revised 2022-2023 revenues
($15,829,450) and expenditures ($14,139,155) and proposed 2023-2024 revenues
($14,474,050) and expenditures ($14,457,838). The city will see an increase in insurance
costs next year.
calmingpolicy, and speed
The City Council and staff discussed traffic, the city's traffic p
cushions. Staff will place an item on a future work session to discuss the city's traffic
calming policy and speed cushions.
Mr. Hindman stated that the preliminarytax rate of $0.498155 was used to
proposed
prepare the proposed Fiscal Year 2024 General Fund budget. The proposed items to add
to the base budget as presented are included in the proposed 2023-2024 budget. He
sought City Council's input on the proposed competitive salary adjustments; addition of
four police officers contingent upon receiving grant funds (partially grant funded); addition
of three firefighter positions contingent upon receiving grant funds (partially grant funded);
reduction of health insurance premiums and GIS position for the Utility Fund.
The City Council had no objections to the salary adjustment, reduction in health insurance
premiums, and the addition of four police officers and three firefighters contingent upon
the city being awarded the grant.
Mr. Hindman also sought input regarding the following recommendations to the base
budget.
• FlashVote Citizen Survey Tool $11,900
• Crossing Guard salary increase (part-time positions) $27,952
• Maintenance of fire burn building
$22,406
• Firefighting bunker gear/PPE $28,554
• Paramedic training $31,715
The City Council discussed the proposed budget and additional requests to add to the
base budget. Apart from Associate Mayor Pro Tern Vaughn, the City Council had no
objection regarding the proposed additions to the base budget.Associate Mayor Pro Tern
Vaughn clarified that he was 95% in favor.
August 4, 2023
City Council Budget Work Session
Page 7 of 8
Ms. Lewis reviewed the budget calendar and dates for the upcoming public notices and
public hearings.
C.4 REVISED 2022-2023 AND PROPOSED 2023-2024 PARK AND RECREATION
FACILITIES DEVELOPMENT CORPORATION OPERATING BUDGET AND
CAPITAL PROJECTS BUDGETS.
The City Council received a presentation from staff earlier in the meeting.
D. ADJOURNMENT
Mayor Trevino the meetingat 2:04 p.m.
Y adjourned
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August 4,2023
City Council Budget Work Session
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