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					                           DUNEDIN, FLORIDA

                            CITY COMMISSION

        BUDGET WORKSHOP OF WEDNESDAY, JULY 11, 2007

                                  6:30 P. M.


PRESENT:             Mayor Bob Hackworth, Vice-Mayor Deborah Kynes,
                     Commissioners Dave Eggers, Julie Scales and Julie Ward
                     Bujalski


ALSO PRESENT:        City Manager Rob DiSpirito, City Clerk Jerie Guegan,
                     Assistant City Manager Harry Gross, Finance Director
                     Sandy Sanders, Budget Officer Annette Stahura, Public
                     Works and Utilities Director Doug Hutchens, Acting
                     Director of Leisure Services Peg Cummings, Management
                     Analyst II Barbara Fidler, Fire Chief Bud Meyer,
                     Supervisor of Fleet Services Randy Moore, City Engineer
                     Tom Burke, Division Director of Wastewater Ken Stidham,
                     Division Director of Water Paul Stanek, Director of
                     Maintenance Keith Fogarty, Division Director of Solid
                     Waste Don Ross, Library Director Anne Shepherd,
                     Harbormaster Bill Frantz, Director of Human Resources &
                     Risk/Safety Nancy Duggan, Board of Finance Members
                     Neal Popham and Sarah McCallum. The press was
                     represented by the St. Petersburg Times.


Mayor Hackworth called the meeting to order at 6:30 P. M.


                           OPENING REMARKS

Mayor Hackworth advised that the purpose of the meeting is to review the Budget
of FY 2007/2008 concluding the General Fund and then to discuss the Enterprise
Funds and Internal Funds.

Vice-Mayor Kynes related her experience yesterday with her car going into a
ditch and expressed her appreciation to the people who helped her, Mark Walters
from the Engineering Department, Adam Hall with TCT Construction, Don Iker a
business owner at Bamboo Tropical, Dallas Fortner and Darrel Deal Jr. with
Fortner Tractor Service.
                                      *****



                                     07-1
Budget Workshop                                      Dunedin City Commission
July 11, 2007
GENERAL FUND CONTINUED

1.      PUBLIC SERVICES/STREETS (pages 83-84)

Mr. Hutchens explained that the total expenditures and percentage increase of
90% is an accurate representation; however, the Streets section is involved in the
proposed reorganization in Public Works. He referred to his July 9, 2007
memorandum that explains the proposed reorganization in detail. It calls for the
elimination of the Traffic Division within Public Works and the distribution of
those services and staff between Public Works, Engineering and the Streets
section and the renaming to the Public Services Division.

    Traffic Control Division Director (General Fund) will become an Engineer III
     (Traffic Engineer) (Utility Fund).
    One part-time administrative assistant reassigned to engineering section
         o Assist with the permitting process within Engineering
    Direct elimination of select staff positions
         o Foreman I position in Traffic (General Fund) – (1 FTE)
         o Foreman I position in Streets (General Fund) – (1 FTE)
         o Streets Supervisor (General Fund – (1 FTE)

Mr. Hutchens referred to the term discussed by Vice-Mayor Kynes “flattening”
and explained that this is an example of that by streamlining. He explained that no
entry level positions are eliminated only middle management positions. He
commented that the intent is to maintain a similar level of service. He noted the
question was brought up regarding the space needs and explained that will be an
item in the Capital Budget portion of the budget review.

Mr. Hutchens referred to page 83 and noted that the total FTE under Proposed
FY2008 should be 12 and not 11.

Mr. Hutchens referred to page 187, Budget Detail:
 Item 4310 – Electricity is going from a budget of $2,360 to $582,360, a
   significant increase attributed to the fact that Traffic has all the City street
   lights cost and that will be transferred over to Streets.
 Item 4610 – Repair and Maintenance noting the increase from $1,200 to the
   $118,000, attributed to picking up the contract with Pinellas County for signal
   maintenance in the City. He advised that he and City Manager DiSpirito
   would be presenting an interlocal agreement in August that discusses
   participation of the City in the Intelligent Transportation System allowing
   some of the costs to be absorbed by Pinellas County.
 Item 5210 – Operating Supplies noting the increase from the previous budget
   of $7,000 to $51,000, attributed to the transfer of barricades and signage from
   Traffic over to the Streets Operations.




                                       07-2
Budget Workshop                                       Dunedin City Commission
July 11, 2007
Mr. Hutchens explained that those changes have an estimated savings of $179,000
a year to the General Fund by the reallocation of resources. He stated he is excited
about the plan that will streamline operations and provide support for Engineering
which may enhance the permitting process.

Mr. Hutchens explained his one concern is space, which he reviewed. He
explained that there is $200,000 identified for a new building in the Facilities
Capital Fund in this year’s budget. The adopted six-year Capital Improvement
Fund (CIP) indicates setting aside $600,000 for three consecutive years to fund
the construction of a replacement building on Lake Haven for Traffic which was
recommended in the 2000 Facilities Assessment Space Planning Study; however,
given the reorganization it seems prudent to expedite that work. He commented
that in order to do that it is necessary to increase the General Fund Transfer to the
Facility Capital Account to complete that a year earlier; however, what is
recommended is to take the difference from Penny-for-Pinellas to expedite the
work; therefore, in the proposed budget there is $300,000 in Penny-for-Pinellas to
bring up the $600,000 to construct the building. He explained the
recommendation is to construct the building where Streets, Stormwater and
Facility Maintenance already exist to consolidate to one location. He explained
that the relocation would free up space at Fleet and Solid Waste for their
expansion needs.

Vice-Mayor Kynes asked how much savings there is with the “flattening”.

Mr. Hutchens explained that his estimate with Streets, Engineering and Traffic
and eliminating a $1.2 million Traffic budget and the dollars that go to Streets and
Traffic indicates an estimated savings of $179,000 per year to the General Fund.

Mayor Hackworth commented on a good presentation in line with the efforts to
make across the board efficiencies.
                                    *****

2.     CITY MANAGER (pages 51-52)

City Manager DiSpirito stated that changes to his budget are minimal.

Vice-Mayor Kynes commented that City Manager DiSpirito’s goals are on target.

Commissioner Bujalski asked City Manager DiSpirito to expand on his goal about
improving the City’s diversity.

City Manager DiSpirito explained that he has just spoken to one of the founding
members of the Inclusion Committee and that he would like to reconvene that
group to discuss various ideas and move on to the next level. He would like to
prepare a comprehensive plan for presentation.




                                        07-3
Budget Workshop                                      Dunedin City Commission
July 11, 2007
GENERAL FUND SUMMARY

Mayor Hackworth reviewed the following:
Revenue Adjustments Discussed
 Fire – expected increase in revenues related to EMS from Pinellas County
 Proposed millage rate resulting in approximately $27,200,000 revenue number

Commissioner Eggers commented that there would be further discussion
regarding the Country Club Lease between now and September.

Expenditure Adjustments Discussed
 Labor cost reduction at $100,000 achieved by the merit rate decision
 Minor adjustments to the transfers to not-for-profits of approximately $16,000
 Commissioner Travel budget decreased by approximately $10,000
 With previous changes agreed to makes a minor adjustment to the Total
   Expenditure shown on page 40

Mayor Hackworth commented that this is in line with the direction for a budget
where the expected revenues meet the needs of the expected expenditures and he
believes those two numbers are very close now. City Manager DiSpirito agreed.
Mayor Hackworth commented then the actual calculation for Unobligated
Reserves is just arithmetic.

Commissioner Bujalski confirmed that the reserve number is approximately 20%
of operating costs and the policy calls for a minimum of 15%. She stated that
several other savings are being considered between now and the final approval of
the budget. She noted that the memo from Mr. Sanders indicated keeping the
reserves inflated and City Manager DiSpirito mentioned that some of those
savings could go into the reserve. She stated she wants to get a general feeling on
this issue. She commented that the reasoning was for an option to cover any
bigger cuts next year. She stated that what she has seen as policy of the
Commission is to use reserves for debt consolidation, paying off debts and/or
capital projects and not operating costs. Commissioner Bujalski commented that
she does not mind having a little extra reserve; however, the thought process
behind paying the operating costs out of reserves as a possibility in the future is
not something she is willing to do.

Mayor Hackworth clarified with Commissioner Bujalski that her concern is for
using reserves for operating expenditures, but not in the budget being discussed;
therefore, that is a discussion to have during the next budget year. He commented
that as far as direction being given to the City Manager and what has been given
in the past, nothing has changed.

Commissioner Bujalski commented that she prefers the additional efficiencies
found after this budget workshop being given back to the citizens and not placed




                                       07-4
Budget Workshop                                     Dunedin City Commission
July 11, 2007
into reserves given the fact that there is already a 20% to 21% ratio. She would
prefer giving a lower millage rate.

Mayor Hackworth stated that is also a discussion for when the millage rate is set
which is an agenda item, both the setting of the TRIM notice as to the highest
number and then again when the millage rate is actually set.

Vice-Mayor Kynes commented that the Board of Finance wrote the policy.
                                 *****

3.      ENTERPRISE FUNDS

Mayor Hackworth clarified to the citizens that the Enterprise Funds are not
generated by ad valorem taxes.

Commissioner Eggers clarified that no decisions are being made at these budget
workshops.

Mayor Hackworth stated that no decisions have been made and this is work
toward the actual Budget Hearings that are scheduled public hearings at which the
public is welcomedto comment on the numbers being brought forward.

PUBLIC WORKS

Solid Waste (pages 87-92)
Mr. Ross provided a handout with updates regarding the goals and objectives
portion that was cut out in the proposed budget document.

Mr. Ross explained that the Enterprise Fund operates as a business based on the
fees charged and that the only revenue is the user fee collected on the bills each
month and there is no funding from the General Fund or tax revenues.

Mr. Ross explained that the proposed budget shows a 1% year over year increase.
He explained that the updates provided are not changes in the numbers, just in the
text, descriptions and goals and objectives. He commented that they are
continually improving the operation and efficiencies.

Mr. Ross highlighted the following:
 Elimination of 1 Driver Position
 Addition proposed of 1 Sustainability Coordinator
      o Growth of the Recycling Program
      o Greening local government

    Service has not changed from last year
    Subscription recycling program has grown dramatically by 24%
    Addition of Spanish Oaks Subdivision



                                      07-5
Budget Workshop                                       Dunedin City Commission
July 11, 2007
   Electronic waste curb side collection fully integrated with a $15 charge per
    appliance
   Purchase of new recycle truck has improved service
   County TIF fees remain stable at $37.50
   Feasibility Study on processing recycling is out for RFP for the County
    regarding better ways to recycling and capacity
   Dunedin continues to be the lowest cost municipal provider in the County
   October should bring in the second phase of the Rate Study the additional
    5.6% increase
   Recommendation for only 5 trucks being replaced instead of 6 trucks
   Possibility of trading in 6 to 8 vehicles for $20,000 to $25,000 each that is not
    represented in proposed financials but will reduce the cost of new trucks.

Commissioner Eggers asked if anything has been done in the past year that might
negatively affect the model from the Burton Study for utility rates.

Mr. Ross stated that he is not recommending any more as he is confident that the
rate increase model will be sufficient. He commented that there are items such as
the resale value of the trucks that does not have a good number yet. He explained
that the biggest negative was a $35,000 rental expense because of an electrical fire
in a vehicle before the new vehicles arrived; therefore, they chose to forego
container and capital purchasing at $70,000 and use only approximately $30,000
to make up for that.

Commissioner Eggers noted that the proposed budget has no increase from last
year which indicates being well within the model forecast.

Commissioner Scales asked what is done with used trash trucks.

Mr. Ross explained that there is a large export market and rental fleets.

Commissioner Kynes commented that she believes that Mr. Ross is saying there
might be a best practice beyond curbside for recycling. She asked Mr. Ross to
review “single stream” recycling.

Mr. Ross explained that “single stream” recycling is in the top ten markets and is
growing. The customer is given a cart just like the one for garbage and all the
recycling materials are gathered in one container. He explained that recycling
needs to be integrated into the whole system and he envisions a service that picks
up trash one day and recycling another day using the same truck and route
structure.

Commissioner Kynes commented that she was happy to see the sustainability
coordinator position which is ahead of the trend.

Commissioner Bujalski noted the recycling promotion budget dropped.


                                        07-6
Budget Workshop                                       Dunedin City Commission
July 11, 2007

Mr. Ross explained that they want to promote the recycling; however, not spend
too much money.

Commissioner Bujalski would like to see other City buildings recycle and use
environmentally friendly products. She noted the goal to work towards
encouraging recycling for businesses and condominiums.

Mr. Ross explained that the key is to inform businesses. He acknowledged that
the department has the capability to pick up larger volumes.

Commissioner Eggers stated that the schools need to be included in the recycling.

Mr. Ross advised that there is a meeting scheduled with Pinellas County Schools
Engineering Department.

Mayor Hackworth reiterated that the Enterprise Funds are run like a business,
efficiently and cost effectively but not making a profit. He reiterated that the City
provides the service at the lowest rate in the County and that is important.
                                      *****

Water (pages 99-100)
Mr. Stanek explained that the budget is staying flat with small increases in
chemical costs and salaries. He stated that they made strides in the goals and
objectives and will continue those in FY2008. He commented regarding being
new to the City and learning how things work.

Vice-Mayor Kynes commented on the report required by the Environmental
Protection Agency sent in the mail to citizens. She noted the public service of
advising people of micro-biological contaminants as some people may be prone to
infections.

Commissioner Scales inquired regarding the well protection.

Mr. Hutchens advised that a proposed ordinance should be presented to the
Commission in August.
                                *****

Wastewater (pages 101-102)
Mr. Stidham reviewed the proposed budget highlighting the following:
 No changes in staffing
 14% increase overall
 Budget Detail( page 196):
       o Item 4310 - Electricity increase of $436,000 attributed to adjustment
          and realignment of electrical charges to correct for appropriate cost
          centers



                                        07-7
Budget Workshop                                       Dunedin City Commission
July 11, 2007
        o Item 4580 - Insurance Expense increase of $137,303 due to a rate
            increase
   All other operating expenses were held to last year’s level
   Significant increase in operating supplies that was offset by decreases in
    professional services and repair maintenance accounts

There was discussion regarding the short-term and long-term disposal of bio-
sludge. Mr. Hutchens explained that there is a study being done for a possible
facility in the north county and the size needed to accommodate the north county.
He explained that the consultant has visited the City’s facility to collect data for
the study, and the report is being finalized for a long-term solution and should be
out any time. He advised that there is still the interlocal agreement with Largo for
now.

Mr. Stidham advised that the current contract expires in November and it will go
out to bid before that; however, there is a letter offering to extend the contract at
the same price for land application for another year. He advised there is money
budgeted to go to the Largo location if that is the choice or if it is necessary.

Vice-Mayor Kynes asked the progress of using bio-sludge for waste energy.

Mr. Stidham explained that there are a number of alternative technologies that
tried to convert the bio-sludge to usable energy and he has been pursuing one of
those trials and hopefully there will be enough data to evaluate its application to
the City’s needs.

Vice-Mayor Kynes commented that it might be worth looking into what the
County is doing. Mr. Stidham stated that they are looking at that.
                                     *****
Reclaimed Water (pages 103-104)
Mr. Hutchens reviewed the proposed budget highlighting the following:
Proposed budget is at a 3% increase over last year by $26,700 due to electricity
and insurance.
 Budget Detail( page 198):
       o Item 4310 – Electricity increase by $21,000
       o Item 4580 – Insurance increase by $32,872
 SWFWMD has decided to support the next four projects and possibly
   accelerate the funding.
 Automatic Meter Reading (AMR) conversion is progressing on track for
   additional efficiencies and cost efficiencies in this fund and Utility Billing.

Commissioner Bujalski asked if the assumptions for the revenue for reclaimed
water include the new projects.

Mr. Hutchens explained only for the partial year because as they are built they are
brought on line and signed up.


                                        07-8
Budget Workshop                                     Dunedin City Commission
July 11, 2007

Commissioner Bujalski asked if the City is doing well regarding conservation of
potable water and over usage of reclaimed water.

Mr. Hutchens explained that they only had to augment in the month of May at 5.1
million gallons and the City is authorized to augment 14 million gallons during
the dry season.

Commissioner Bujalski commented that last year reclaimed water was moved in
with Water and Wastewater, but still there is a transfer from reclaimed water to
the Public Works Administration the way that Enterprise Funds are done.

Mr. Hutchens noted that is on page 198, line item 3730, and is a remnant from the
prior year when it was tracked separately and should not be there; however, he
would confirm this with Finance.

Commissioner Kynes asked how much the SWFWMD grant would be.

Mr. Burke explained that the SWFWMD grant is two-fold now with it being
programmed to have approximately 60% funding rather than 50% because of
other State money made available. He recalled that there is a $2.6 million overall
project and expect the grant funding to be $1.4 to $1.5 million. He stated that
presuming that the contractor is prepared the construction is expected to be
completed by the end of this year in order to bring more customers on line in time
for next year’s dry season.

Mr. Burke stated that the Pinellas Anclote Basin Board is scheduled to have their
February meeting at the Community Center and the City will be able to thank
them for the funding made available.
                                    *****

Utility Fund Summary –Water – Sewer - Reclaimed Water (pages 92 -94)

Commissioner Eggers suggested an analysis to get an update on the changes that
have occurred in the interim two-year period since the model from the Burton
Study was implemented. He commented on the importance of being confident the
model is being preserved and rates would not have to be addressed too soon.

Commissioner Eggers referred to the Budget Detail and expressed the following
concerns:
 Noting that the utility retirement accounts experienced positive increases and
   percentages year to year and the General Fund has experienced decreases and
   asked for an explanation.
 How the inter-department transfer from the Enterprise Fund is determined.
 The impact of moving the technical administration from the General Fund
   over to the Utility account, a change that was not part of the model.



                                      07-9
Budget Workshop                                       Dunedin City Commission
July 11, 2007
   A better understanding of the increase in electrical costs and where they came
    from and are going to determine if there was an inordinate hit on the Utility
    account that was not anticipated.

It was noted that these concerns would be discussed at the meeting on Friday.

Commissioner Bujalski expressed concern that the changes this year were not
considered in the original assumptions of the Rate Study. She commented that the
7.5% rate increase that is inclusive was achieved last summer by moving some
capital projects out of the scenario that Burton & Associates showed and funded
alternatively because the original recommendation was 8.25% and it went to
7.5%. She stated now less than a year later staff comes back saying they can still
maintain the 7.5% and keep those projects in the Utility Fund and still afford to
pay for it. She stated her concern is that the assumptions greatly changed before
even implementing and in a very short period of time. She stated that last year the
Commission expressed concern that the assumptions for the previous water
increases were already changing and she felt they were changing too quickly in
addition to seeing this budget and what has not been covered, the Stormwater that
has a loss in income. She stated she is concerned for garbage rates and it is her
understanding that they are using income and information from staff to come up
with their scenarios. She stated she does not want to approve this Utility budget
until the consultant comes back and tells the Commission what happened.

Mayor Hackworth commented that it seems that Commissioner Bujalski is saying
that they have built in some capital expenditures that are funded from utility fees
and anticipated to be funded by financing; therefore, the suggestion is that if they
were funded by financing, then the utility rate increase could be lower.

Mr. Sanders referred to a memo to the Commission with a description of what has
happened and offered to paraphrase that memo from memory as best he can. He
explained that the original rate increase recommendation was approximately 8.2%
which the Commission decided was too much for the citizens and staff looked for
ways to alleviate that. He explained they found that in pulling out the reclaimed
projects from the capital the effective debt service savings would be able to
provide a 7.5% rate increase which was approved. He explained that the
Commission at that time directed that staff add to the budget because the
Reclaimed projects were listed in the Utilities that the budget be footnoted that
those projects were to be funded through debt financing and at that time staff
stated the source of debt service would be the Capital Cost Recovery Fees and if
those were not sufficient there would be the availability of Penny-for-Pinellas
money. He stated that at the time staff had no way of knowing what revenues
would be available from Capital Recovery Fees that being dependent on the
subscription to the reclaimed facilities. He explained that over time and
considering opportunities to fund the utility projects they found the availability to
fund within the utility rate structure through wrapping the debt service the ability
to fund those reclaimed projects and notified the consultant of the possibility. He



                                       07-10
Budget Workshop                                       Dunedin City Commission
July 11, 2007
ran a scenario that showed within the current debt structure the City could now
fund those reclaimed projects for two reasons: they could wrap the debt and the
City had a much more attractive debt financing rate then what had been in the
original assumption that was 5% at which time rates were moving up. Staff came
in with a 3.59% funding which is substantially less providing the opportunity to
fund through the latest bond issue the reclaimed projects as well as the other
projects and at the same time the Commission had approved combining the
Reclaimed Fund with the Utility Fund. He stated that it is generally shown that
way as reclaimed is an outfall from wastewater process it is rare to separate out
the reclaimed product from the wastewater operations. He commented that
nothing stays static from year to year and there was an opportunity to save a good
deal of money from financing while financing the Reclaimed projects.

Mayor Hackworth commented that as part of that the representation is that there
was no opportunity to lower the factored-in utility rate increase. He summarized
that Mr. Sanders did an analysis and found the most cost effective way to do the
capital expenditures and it did not have to affect the rates and the rate is fair and
equitable to provide the service.

Mr. Sanders agreed with Mayor Hackworth’s summary.

Commissioner Bujalski commented that it gives her pause as to what the
assumptions were and recalled that the Commission asked for a yearly review of
these types of rates. She stated that she does not want to make a decision on this
until the consultant reviews this and stormwater.

Mayor Hackworth recalled there was clear direction for an annual review;
however, he did not recall whether that was to be outside or internal. He thought
that the direction was for staff to do an annual review to make sure the
assumptions are in line with the actual performance of the fund and that review is
needed to determine the final approval of the number to go into the budget and
perhaps an adjustment to the rate increase could be considered.

Vice-Mayor Kynes recalled that was a clear discussion for a periodic review of
the rate structure. She also noted that it is an Enterprise Fund and as such the
umbrella view was appropriate. She stated that if another source was considered it
would be the Penny-for-Pinellas and there has been discussion on the importance
of the Penny for major stormwater projects.

Mayor Hackworth commented that the review was to justify the continued
efficacy of the annual rate increase and if the rate increase needs to be adjusted
there is an opportunity to consider that. He stated that right now the
recommendation is to leave the rate increase at 7.5% and the numbers become an
Enterprise Fund with the expected revenues equaling the cost of providing the
services. He reiterated that the Commission does need the review.




                                       07-11
Budget Workshop                                       Dunedin City Commission
July 11, 2007
Commissioner Scales commented she believed that is what Commissioner Eggers
was asking for in what affects the rates. She stated that this Commission
unanimously approved financing of the projects in this Enterprise Fund. She
recalled that the Commission wanted Reclaimed in Water and that in order to
have the 7.5% rate increase it had to be financed elsewhere.

Mayor Hackworth clarified that the review is that the assumptions that were made
that resulted in a 7.5% increase to make sure they are in line and based on sound
assumptions.

Mr. Sanders explained that as a matter of course as part of the audit at the end of
each year there is an in depth analysis examining revenues and expenditures of an
analysis of the Rate Covenant which is a measurement of how the rate study is
tracked and staff will go back and look at the assumptions and how those compare
to date with the original.

Commissioner Eggers stated that the comment was on target that the Commission
intent last year was to have the capital items for reclaimed under the umbrella;
however, it had to be pulled for reasons discussed and now that there is a chance
to wrap it back in and it fits the model is a good thing. He commented that
Stormwater is a completely different issue to be discussed.

Commissioner Bujalski stated that she looked into this and how it became an
issue was that all the minutes form the discussions on the rate adjustment last year
referred to using the Penny in order to keep the 7.5% and there was direction
given. She stated that this is the better option from a financing standpoint except
that it was not brought to the Commission’s attention that there might have been
an option to reduce the water rate.

Mayor Hackworth commented that he does not know that it had not been brought
to the Commission attention.

Commissioner Scales stated she read the minutes also and she did not think there
was a direction to staff where the funding had to come from.

City Manager DiSpirito commented that administratively they would be happy to
do the review. He stated that as Mr. Sanders indicated the explanation was
provided in writing to the Commission this past week. He stated that the
appropriate source fund was used, the rate the Commission requested was
achieved with lower financing and additional revenues which is the appropriate
way to go about it. He stated that the footnote in the budget referred to more than
the Penny including fees, grants and other sources. He stated that it is best to
avoid outside sources to prop up an Enterprise Fund which can bring on many
violations and problems.




                                       07-12
Budget Workshop                                      Dunedin City Commission
July 11, 2007
Mayor Hackworth emphasized that there is a proposed budget that indicates it
costs $16.9 million to provide Water, Sewer and Reclaimed services to the
citizens and that the revenues generated from fee payers of those services is $16.9
million and that is the essence of an Enterprise Fund. He asked how the City rates
with others when the charge is benchmarked.

Mr. Hutchens stated that a year ago the study indicated the City was in the middle
and that can be provided with the analysis of the recent performance.
                                     *****

Stormwater Utility Fund (pages 112 – 113)
Mr. Fogarty reviewed that the proposed budget reflects no increase for the coming
fiscal year and that Mr. Hutchens has addressed how the reorganization affects the
maintenance division.

Mr. Fogarty reviewed the proposed budget highlighting the following:
 Department continues to be compliant with the MPS Stormwater permit.
 TMDL issues are getting closer and it does reflect in the proposed budget that
   Curlew Creek and Cedar Creek remain as impaired water bodies and samples
   are being collected from both creeks to address that possibly the TMDL’s are
   not accurate.
 Sweeping contract with FDOT at State Road 580 and Alternate 19 that had a
   4% increase last year would possibly be negotiated at a higher increase this
   year.

Commissioner Eggers commended the Stormwater Department for the work they
have been doing that directly affects homeowners and noted that stormwater work
benefits the entire City.

Sarah McCallum, Member of the Board of Finance reviewed the concerns:
 The FY2007 revenues are tracking year to date to come in significantly lower
   than expected.
 The study for the rate increase used the assumption of $1.8 million in
   revenues from the $6.00 Stormwater Fee.
 The revenues are expected to come in this year at approximately $1.6 million
   a considerable shortfall in an already tight Enterprise Fund.
 The revenues will impact the Reserves significantly and not allow for making
   the full $700,000 Capital Improvement Transfer and would allow for a
   $681,000 transfer.
 The explanation from staff as to why revenues were not in line with the
   projections was that the expectations in the study ended up at a number too
   high and there was thought that the FY2007 revenue number had
   consideration for growth and development.
 The Bond Issue that was approved for the financing for the Utility Fund
   project, this proposed budget is showing all the interest charges in the Utility



                                      07-13
Budget Workshop                                      Dunedin City Commission
July 11, 2007
    Fund when some should be applied in the Stormwater Fund; however, those
    figures are not available for FY2008.
   If there is a transfer close to the figure in the Capital Improvement Transfer
    there will be zero reserves.
   The rate increase that was done in FY2006 is sliding in the negative and there
    is a commitment to a Five Year Plan for projects that have continued
    maintenance costs.
   The revenue number projected for FY2008 is higher with an assumption of a
    4% growth rate over the revised FY2007 revenues and that translates into over
    11,000 new residential units which probably will not happen and many new
    developments will only pay the $4.50 fee and not the $6.00 fee.

Mayor Hackworth reviewed the figures with Ms. McCallum and confirmed that it
would at least track to the $1.664 million and the projection for FY2008 is $1.7
million and it needs to be $1.6 million because there has not been much unit
growth.

Mr. Hutchens commented that 11,000 new units for the fiscal year is overly
optimistic.

Mr. Sanders explained that staff has been putting the adjustments together
working toward a number for the Commission taking Ms. McCallum’s comments
seriously and the number they came up with is revenues of $1,664,173. He stated
that they had to allocate the interest expense for the new bond issue that comes up
to an additional $220,000 and there are other adjustments to be made before
arriving at a revised budget.

Mayor Hackworth reiterated that in adjusting the revenues down the transfer will
also have to be reduced.

Mr. Sanders advised it is anticipated to transfer $350,000 instead of the $700,000.

Ms. McCallum stated that the Bond Issue will help but when the Five Year Plan is
completed, if it continues collecting these revenues and operational expenses that
will leave it at $350,000 in additional revenues to maintain the new stormwater
projects the bond issue allowed to be done and either they will not be able to be
maintained or there will be a last minute rate increase in 2010.

Mayor Hackworth stated that there needs to be a new page 110 to work with.

Vice-Mayor Kynes requested the recommendations.

Mr. Sanders recommended waiting for staff to finish the report recognizing that
the Revised FY2007 Budget number was out of line and as near as he can
estimate that was based on assumed growth much the same as was done with




                                      07-14
Budget Workshop                                      Dunedin City Commission
July 11, 2007
impact fees where certain assumptions regarding growth did not happen. He
proposed that staff redo this schedule with the appropriate assumptions for Friday.

Commissioner Bujalski asked if part of the reason that Ms. McCallum felt the
revenue was miscalculated was she was told that there was no rate increase for the
neighborhoods that have Stormwater.

Ms. McCallum explained that she cannot say that specifically; however, that
could be assumed reviewing the system. She explained that if new development
had their own stormwater system complying with new mandates that
neighborhood pays a discounted rate of $4.50 and the older neighborhoods pay
the $6.00 Stormwater Fee.

Commissioner Scales clarified with Mr. Hutchens that with the financing
approved a couple of weeks ago it is assured that the capital projects in the Five
Year Plan will be done.

Mr. Hutchens commented that yes on the assumption that the revenues will cover
the debt expense, then the debt proceeds from the Bond Issue will complete the
Five Year Plan.

Commissioner Scales asked assuming the revenue numbers discussed at what
point in time might there be a possible shortfall of money for maintenance.

Mr. Hutchens stated he would need to see the new figures for page 110. He felt
that before the budget is adopted he would be able to say FY2009/2010.

Commissioner Scales reiterated that the Five Year Plan projects of which this is
year two are not threatened.

Ms. McCallum noted that there would be an update on page 162 for the Capital
Transfer.
                                 *****

Marina Fund (pages 106-108)
Ms. Cummings commented that the Marina is a successful Enterprise Fund that is
set up in two parts: Part A which relates to Operating Expenses and Part B that is
for Capital Improvements. She explained that Part A fees were last increased in
2005 at $23.71 per slip and ramp fees were increased in 2006.

Ms. Cummings reviewed the proposed budget highlighting the following:
 Projected revenues are $450,964
 Projected expenses are $456,393 including the $150,000 that goes into the
   R&R Account every year.
 There is a shortfall of $5,429 that would be a draw down on the Reserves




                                      07-15
Budget Workshop                                      Dunedin City Commission
July 11, 2007
   Reserves are healthy looking at a 5% increase making them in excess of
    $587,000

   Recommendation is it is necessary to raise rates; however, the Marina
    Advisory Committee recommended in June to postpone an increase in slip
    rentals for eight months and would like to seek discretionary authority from
    the Commission to raise rates periodically incrementally.
   A rate survey is in process.

Mayor Hackworth clarified with Ms. Cummings that the proposed budget does
not reflect a rate increase and that the boat slip rental increase is the transient
money that was placed in that line item.

Vice-Mayor Kynes reviewed that last year the Part B fee was raised and that is
money being set aside for the dredging every ten years and major capital projects.

Harbormaster Frantz explained that they would like to propose to increase
incrementally each year in January in order to stay on schedule for the ten year
projection for dock and seawall replacement and dredging.

Mayor Hackworth summarized that the proposed budget meets the needs of
operations and a transfer of R&R Funds without compromising the definition of
an Enterprise Fund.

Ms. Cummings noted that is without the $5,000 from Reserves, but still the Fund
is solvent and Reserves are excellent.

Commissioner Bujalski asked if the money was taken from this fund for the
Edgewater Park bathrooms.

Mayor Hackworth explained that is a different account.

Assistant City Manager Gross recalled that the decision was to move ahead with
the project and decide funding later. He explained that the recommendation was
to pull $27,000 from the Capital Reserves.

Commissioner Bujalski addressed the significant boat revenues increase and
discussion ensued determining that with the out-of-town fee increases and
projections that the FY2007 Budget will be exceeded.

Commissioner Scales noted that the Marina Advisory Committee is
recommending incremental fee increases each year, but that is not reflected in this
budget.

Mr. Frantz explained that the issue will be revisited in eight months after the
marina survey is completed.



                                      07-16
Budget Workshop                                       Dunedin City Commission
July 11, 2007

Ms. Cummings explained that the Marina Advisory Committee realizes that rates
need to go up; however, they want the deferred time period for a rate study and
that the Board of Finance feels that when the deficit begins then rates must be
increased.

Commissioner Bujalski asked about the moorings. Mr. Frantz advised that a
feasibility study is in process.

Ms. Cummings explained that Mr. Kevin Campbell and Mr. Matthew Campbell
are looking at a permitting process for the possibility of 68 moorings and
consideration of the parking aspects and so forth.

Mr. Popham explained that there are two reserve funds:
    Part A. Reserve Fund is for Operating Costs with approximately $133,000
    Part B. Reserve Fund is separate with approximately $540,000 and
       receives $150,000 per year.
He explained that the study indicates it will require that Part B be raised in the
range of 7% a year to cover the work for the dredging out ten to twelve years. He
explained any increase in Part A is like everyone else’s insurance and electricity.

Mayor Hackworth summarized that the FY2008 reflects a beginning Reserve of
$136,000 which is projected to go up because of the underestimated boat ramp
revenues from FY2007; therefore, the ending reserve will be $136,000 plus that
would affect the ending reserves of FY2008 and this is operating as an Enterprise
Fund and there is an adequate transfer to the Capital Improvement Fund.
                                     *****

St. Andrews Golf Course Fund (pages 115-116)
Ms. Cummings reviewed the proposed budget highlighting the following:
 Projected Revenues for FY2008 Budget $622,328
 Projected Expenses for FY2008 Budget $674,163
 Deficit of $51,835
 Comparison to the FY2006 of $129,122 that included a $92,000 transfer from
    the Leisure Services Capital Improvement Fund
 Positive trending continues
 Revenues for the first six months this year are up to approximately $19,000
 Greens Fees portion are $15,000 that increased from this year to last year
 Maintenance/storage cart building is being completed
 Parking lot and restrooms have been refurbished
 The Proposed Budget was reviewed by staff and Mr. Popham and the
    projection is based on the current trending that a positive cash flow will begin
    in 2010 and then a capital account can be established.
 Consideration is being given to various ideas to accomplish the goal more
    quickly including strategic fee increase, new marketing initiatives, review of



                                       07-17
Budget Workshop                                       Dunedin City Commission
July 11, 2007
    the food and beverage business and additional tournaments and long range
    capital goals.
   Purchase of a new tractor has been pulled from this proposed budget at
    $21,000.

Commissioner Eggers noted that the projected revenues in the budget document
are different.

Ms. Cummings advised that the figure was revised after the budget document was
printed and it is $622,328.

Commissioner Eggers asked for clarification regarding the capital for the course
is coming from Leisure Services Capital Improvement Fund a couple of years ago
and the General Fund is subsidizing the shortfall.

Ms. Cummings explained it was her understanding that it comes from the Leisure
Services Capital Improvement Fund, but there is no transfer this year.

Mayor Hackworth explained that there needs to be a detail as to where the
funding for the shortfall is coming from.

Mr. Popham asked if there is a fee increase built into this proposed budget.

Ms. Cummings advised that there is not, but Mr. Sylvester is looking into the fee
increase strategically and there is a plan but it is not reflected in this budget.

Mr. Popham stated that there is no competition north of St. Petersburg and it is
being undersold.

Vice-Mayor Kynes stated there was a discussion of using a concessionaire like
they have at the Fine Arts Center and asked if that was a consideration.

Ms. Cummings explained it was part of the recommendation from the Board of
Finance.

Mayor Hackworth commented that figures in the proposed budget are lacking
right now as they do not accurately reflect the clubhouse sales and the transfer
from Leisure Service Capital Improvement Fund.

City Manager DiSpirito stated the figures would be updated for Friday and with
respect to fees that would take time to refine for the final figures.

Mayor Hackworth explained that approving the budget on Friday does not
preclude raising the fees, it is a working document and there will be a consultant
report to address the ability to raise fees later.
                                        *****



                                      07-18
Budget Workshop                                       Dunedin City Commission
July 11, 2007
BREAK FOR 5 MINUTES

4.     INTERNAL SERVICE FUNDS

Self Insurance Fund (pages 128-129)
 Ms. Duggan reviewed the proposed budget highlighting the following:
 Unobligated Reserve Fund of $2 million required by resolution is being met.
 Unobligated Restricted Reserve of $600,000 is maintained for potential claims
    of Liability and Worker’s Compensation.
 Operating Budget is status quo.
 Property insurance is the big concern with approximately $2 million budgeted.
 Bids will go out this summer to be coming in August for property insurance.

Kirk Gehring explained that they are exploring all the options available and there
are four separate trusts that have agreed to review the coverage and provide a
quote or advice regarding the quotes as to whether they are more competitive. He
discussed an overview of the market and noted that the indication is that the actual
price per $100 of coverage would be reduced by all insurers; however, the issue is
the appraisal and whether the amount of coverage is considered reasonable by
FEMA standards.

Mayor Hackworth clarified that the projected numbers are at the high end and it
may come in lower.

Commissioner Bujalski asked if the appraisals have been done on everything.

Ms. Duggan explained that the appraisals are being done in four phases and right
now is phase 2; therefore, the ones that were hit on phase 1 are sharing a larger
burden of property insurance until all the appraisals are completed.

Commissioner Bujalski reviewed that last year the $800,000 increase was not
distributed through the departments, but in this proposed budget the increases
have been.
                                  ******

Fleet Services Fund (pages 122-123)
Mr. Moore reviewed the proposed budget highlighting the following:
 Slight increase in fuel cost is anticipated.
 Dramatic increase in the property insurance cost.
 Increases in Utility costs.
 A meeting is scheduled tomorrow with Enterprise Leasing to explore savings
   opportunities.
 Hybrid and electric cars have been implemented.

Commissioner Bujalski reviewed that last year the Commission asked for a fuel
cost savings plan and there was a memo presented in August. She requested a


                                       07-19
Budget Workshop                                       Dunedin City Commission
July 11, 2007
report on the results of cost savings achieved and a revised plan for this year with
projected cost savings.

Mr. Moore commented that every year he tracks fuel usage carefully and every
year less fuel is used; however, the cost does not go down. He attributed much of
the savings to Mr. Ross improving the routes in Solid Waste and fuel saving
practices implemented.

Commissioner Eggers asked if Mr. Moore felt comfortable this coming year that
there is enough money coming from the departments to cover the operation.

Mr. Moore stated he is conservative, but he is comfortable with what is being
brought in. He noted that the cost increases in 2006 caught everyone off guard;
however, the adjustment was made for this year.

Commissioner Eggers asked how the life of a vehicle is determined.

Mr. Moore explained that historically they set an anticipated life by years for
example most service trucks are on a ten year cycle and solid waste trucks on a 5
year cycle and at the end of that period each piece of equipment is reviewed as to
whether it can be extended or not.

Commissioner Eggers asked if Mr. Moore was comfortable that employees use
practices to extend the life of the vehicle.

Mr. Moore stated there is always room for improvement, but the vehicles are
monitored to make sure they are not abused or neglected.
                                    *****

Public Services Facilities Fund (pages 124-125)
Vice-Mayor Kynes commented regarding the “green cleaning” that goes along
with the goal for a “green city”.

Commissioner Bujalski commented that City Manager DiSpirito is looking at
some things with Facilities and custodial.

City Manager DiSpirito explained that proposals have been sent to some service
providers in the private sector to see what options are available. He commented
that one of the performance measures in the RFP was to absorb the City
employees.

Commissioner Eggers reviewed the figures with Mr. Fogarty regarding the
transfer from operations and the transfer to the Capital fund, and the
recommendation to keep the $300,000 from the Penny and have a larger reserve at
the end of the year.




                                       07-20
Budget Workshop                                     Dunedin City Commission
July 11, 2007
Mr. Fogarty commented that there has been discussion regarding how Facility
rates impact some of the department budgets and noted that a 3% reduction is
shown in this current year budget. Over the past five years, there has been a
tremendous amount of increase in square footage. He explained when the rates
were revised and set in 2003 the projection was for them to hold five to six years
and so far they have been kept at that. He explained that in this year’s actual
budget in detail there is a $40,000 reduction in Repair & Maintenance that is
reflective of what has been spent in the last two years on old buildings that the
newer facilities do not require. He stated that since FY2003/2004 the actual total
Facility budget has only grown 9.5% that comes out to about 1.8% per year. He
attributed that to staff being efficient and mindful of costs.

Mr. Fogarty advised that the bid that went out for custodial requires green
practices with green certified materials.
                                      *****

Mayor Hackworth advised that the Commission would adjourn for the night with
two items to roll over to the Friday meeting from the Internal Funds.


The meeting was adjourned at 9:30 P. M.



                                  ______________________________________
                                   Mayor


ATTEST:

______________________________
City Clerk




                                      07-21

				
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