07/10/2012 Finance CommitteeFINANCE COMMITTEE MEETING MINUTES
July 10, 2012
Councilmembers Present Staff Present
Councilmember Buckshnis Shawn Hunstock, Finance Director
Councilmember Yamamoto Deb Sharp, Accountant
Carl Nelson, CIO
Public Present Jeannie Dines, Recorder
Ron Wambolt
Bruce Witenberg
Councilmember Buckshnis called the meeting to order at 6:00 p.m.
A. Quarterly Fiber Project Report
Mr. Nelson reviewed expenditures to date, an explanation of expenditures by category, current
revenue from customers 2010 to date, and a graph of original fiber investment minus savings and
revenues. Councilmember Buckshnis asked about future projections. Mr. Nelson recommended
waiting to make projections until a business plan is developed; the business plan will be a decision
package in 2013 budget.
Action: Schedule on Consent Agenda.
B. 2012 July Budget Amendment
Ms. Sharp explained there are two primary amendments, 1) carry forward the ending 2011 fund
balances per the CAFR and adjust the 2012 beginning fund balances, and 2) related to the 2011 debt
issue that closed on December 28, 2011. The amendment also includes housekeeping items
discovered during the audit related to directly receipting funds into the Tourism Promotion Fund and
transferring funds from the TBD to the Street Fund via an interfund transfer. The final budget
amendment is a request to transfer excess cash in the debt service funds to a reserve fund titled Risk
Management Reserve Fund.
Action: Schedule for full Council.
C. Utility Penalty Waiver Policy
Mr. Hunstock reviewed the revisions to the policy, 1) add a timeframe (45 days) during which a
customer can request a waiver, 2) not allow a waiver if the customer is more than one statement past
due, and 3) decrease the waiver amount that requires his approval from $250 to $100. Following input
from the Parks, Planning and Public Works Committee, the first sentence was revised to read, "If a
customer has been assessed a 10% penalty due to non - payment of a utility bill, the City will allow one
penalty adjustment every three years, per customer. and the second sentence, " Exceptions will only
be made in the case of a new property owner, or new tenant." was deleted.
Action: Schedule on Consent Agenda.
D. Reserve Policy
Mr. Hunstock highlighted several sections:
• Section 4: Establish a Contingency Reserve Fund with an initial minimum balance of 8% of
annual General Fund revenues and establish a schedule for reaching a minimum balance of
16% by 2016. Committee recommended removing the schedule.
July 10, 2012 Finance Committee Minutes, Page 2
Section 4.1: The Council will not use the reserve fund unless there is a 10% difference
between actual General Fund revenue and expenses.
Section 4.2: 10% of sales tax receipts from new construction will be directed into the
Contingency Reserve Fund. Committee recommended changing this to 5 %.
Section 5: Establish a Risk Management Reserve Policy with a target balance of 2% of
annual General Fund revenue.
Action: Schedule for full Council with Finance Committee recommendation to approve as revised.
E. May 2012 Monthly Financial Report
Mr. Hunstock explained a number of changes have been made to the report; it is now in a newsletter
type format, additional content will be added in the future to make the report more user friendly. The
report was retitled to Monthly Financial Report (previously General Fund Monthly Update) because it
now includes all funds. He intended to provide this level of detail every month, not just quarterly.
Councilmember Buckshnis suggested a few changes to the reporting format and asked several
questions regarding the data.
Action: Schedule on Consent Agenda.
F. Public Comments
Ron Wambolt, Edmonds, asked whether there were plans to produce a monthly budget, explaining
in the private sector, monthly budgets are used to create the annual budget. Mr. Hunstock responded
he was not aware of any city that had a monthly budget. The Monthly Financial Report compares the
month to the annual budget. Mr. Wambolt pointed out the mayor of Scranton, Pennsylvania, cut
salaries to minimum wage due to financial difficulties. Mr. Hunstock commented Gold Bar may
unincorporate if voters to not pass a levy.
Bruce Witenberg, Edmonds, reiterated his request for a presentation regarding claims that are /are
not covered by insurance. Mr. Hunstock suggested having Washington Cities Insurance Authority
(WCIA) make a presentation regarding the type of claims they cover, the City's claim history, the
City's coverage and deductible, etc.
Adjournment— The meeting adjourned at 6:45 p.m.