City of North Miami Beach. FY 2014 Budget Workshop

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1 City of North Miami Beach FY 2014 Budget Workshop 1

2 Budget Workshop Agenda General Fund Overview Revenue Highlights Expense Highlights Self Insurance and Workers Comp. 2

3 Millage Rate: unchanged Current Millage rates

4 Millions Taxable Property Values $3,000 $2,500 $2,000 $1,500 $1,000 $500 $ Taxable Property Value 4

5 FY 2014 Budgeted General Fund Revenue Appropriations of prior year balances, $2,570,000 Other revenue, $3,645,160 Fines and forfeitures, $298,000 Interfund transfers, $6,983,306 Charges for Services, $7,678,350 Ad Valorem taxes, $10,923,000 Other taxes, $6,977,710 Licenses and permits, $892,700 Intergovernmental, $4,412,200 5

6 Millions Revenue Comparison FY 2013 vs FY 2014 $14 $12 $10 $8 $6 $4 $2 $- FY 2013 Adopted Budget FY 2014 Adopted Budget 6

7 Budget Workshop Agenda General Fund Overview Revenue Highlights Expense Highlights General Fund Overview Departments with changes Self Insurance and Workers Comp. 7

8 FY 2014 General Fund Expenditures by Function Mayor & Council, $1,194,996 Public Services, $6,878,831 City Clerk, $431,426 City Attorney, $709,070 City Manager, $769,047 General Services Administration, $7,234,734 Finance, $1,193,508 Human Resources, $841,865 Police, $20,484,382 Leisure Services, $4,642,567 8

9 FY 2014 Expenses by Classification Capital Expenses, $3,790,788 Non-Operating, $1,769,708 Operating Supplies, $7,124,983 Pension, $7,986,380 Salaries (excl Pension), $23,708,567 9

10 FY 2014 Budget FAQs 10

11 FY 2014 Budget FAQs What services were cut? What services were added? What improvements to the City will be made? How much more will I pay in taxes? Did the budget go up or down? Why? Where is pension reform? 11

12 FY 2014 Budget FAQs What services were cut? NONE! 12

13 FY 2014 Budget FAQs What services were added? Continue the extended hours in aquatics and expand swimming lessons Library continuing evenings, weekends and adding security guard Part time Park Ranger added to keep fields, parks and tot-lots open and monitored during the weekends and evenings. 13

14 FY 2014 Budget Initiatives Key Highlights & Issues Addressed What improvements to the City will be made? ERP ($2.7M) Financial software better reporting, easier doing business with the City, more transparency and accountability of your government Repair YES Center Roof & AC Units ($178,000) Performing Arts Theatre Roof & AC Units ($353,000) $125,000 Trees enhancing the canopy, adding shade and beauty The enterprise and grant funds are bringing many more capital items including bus shelters, street signs and traffic calming devices. 14

15 FY 2014 Budget FAQs How much more will I pay in taxes? The operating millage tax rate is unchanged from last year. The debt service rate will be less. Therefore, on average the residents should not see any increase in their City tax bill. 15

16 FY 2014 Budget FAQs Did the budget go up or down? Why? The budget increased $6.25M mainly for three reasons: Fully fund the Police Department ($2.24 million) Financial and Reporting Software ($2.8 million) New roof & A/C on YES Center and Performing Arts Theatre ($530,000) 16

17 FY 2014 Budget FAQs Where is pension reform? Reform is underway. The management plan was reformed in February 2013 saving the City $763,063 (65% decrease). Pension Plan FY 2013 FY 2014 Difference Police $5,329,918 $5,647,737 $317,819 Mgmt $1,181,898 $418,835 $(763,063) Gen Empl. $3,751,374 $4,281,589 $530,215 Total $10,263,190 $10,348,161 $84,971 Citywide costs 17

18 Budget Workshop Agenda General Fund Overview Revenue Highlights Expense Highlights Self Insurance and Workers Comp. 18

19 FY 2014 Departmental Highlights Non Departmental Dept. # 105 FY 2013 Budget FY 2014 Budget Change $1,957,280 $5,852,839 $3,895,559 4 vehicles for Public Services - financed ($151,000) ERP system financed ($2.7M) Debt service on financed equipment ($570,000) 19

20 FY 2014 Departmental Highlights Police Department Dept. # FY 2013 Budget FY 2014 Budget Change $18,246,180 $20,484,382 $2,238,202 5 Officers from COPS Grant 6 Task Force Officers transferred from LETF 1 Police Officer transferred from CRA Police pension contribution increased New COPS grant application submitted for 4 new Police Officers 20

21 FY 2014 Departmental Highlights FY 2013 Budget FY 2014 Budget Change $4,471,264 $4,642,567 $171,303 Leisure Services Dept. # Silverman Park upgrades ($20,000) funded from donation Aquatics: Pool hours and swimming lessons expanded Re-Opening of Allen Park (fitness center, disability gym, computer lab, summer camp and teen and after school programs) Library Hours evening and weekend hours continued Security Guard at Library Park Ranger to monitor all City fields, tot-lots, and passive parks on weekends and evenings 21

22 FY 2014 Departmental Highlights Public Services Dept. # FY 2013 Budget FY 2014 Budget Change $5, $5,761,390 $563,256 New roof & AC on YES Center and Performing Arts Theatre (530,000) ADA Compliance improvements ($25,000) City Hall parking lot repaving ($50,000) Allen Park athletic field improvements ($50,000), security cameras ($30,000), new gym floor ($65,000) Tree Planting ($125,000) 22

23 Budget Summary Carry forward of $2.5M in anticipation of CBA savings Contingency decreased from $646,605 to $232,878 No services cut Additional recreational services provided Investment in City infrastructure Update City s enterprise software 23

24 Budget Workshop Agenda General Fund Overview Revenue Highlights Expense Highlights General Fund Overview Departments with changes Workers Comp. and Self Insurance 24

25 Workers Compensation (050) FY13:FY14 Changes: FY13 budget already had to be revised and the burn rate is still much higher than budgeted, so the FY14 Budget looks high! We are OK when benchmarking externally (mod factor of.82 is good), but we are not trending in the right direction We need to budget appropriately AND take critical action to bend the trend.

26 Summary of Costs: Workers Comp (050) FY13 REVISED FY13 RUN RATE FY14 BUDGET VARIANCE FY13 RUN RATE: FY14 BUDGET $802,497 $1,120,007* $1,039,791 ($80,216) *Run rate is YTD actual of 10 $933,339: - runs at $93,339/month - at twelve months, this equals annual rate of $1,120,007

27 Summary of Key Actions WORKERS COMPENSATION (050) Proactive, Internal Support: Return to Work Program Safety in the Workplace Program and Safety Committee Drug Free Workplace Policies and procedures update and training Formal, collaborative quarterly review process with Legal and TPA for more proactive approach to claims management / settlement Enhanced Professional Support, with Assessment and Recommendations for Improvement: Policy placement and type; calibration of deductibles Formal RFP process for our Third Party Administrator for enhancements to pricing, service, and outcomes

28 Liability (030) FY13:FY14 Changes: Reorganize; invest in people to contain costs, improve programs, and minimize risk for the organization moving forward Evaluate coverage types and vendors (property and liability); examine premium costs and deductibles; calibrate reserves to appropriate levels Improve risk transfer and risk retention Protect the City 12% increase to bottom line

29 Summary of Costs: Liability (030) FY13 REVISED FY14 BUDGET VARIANCE $924,700 $1,034,573 +$109,873

30 Summary of Key Actions LIABILITY (030) Assess Policies Examine all coverage in place, including premiums related to deductibles and type fully insured; quasi insured; self insured Improve Protection Examine the actual property which is covered (comprehensive asset survey) Add components as indicated such as Public Officials policy Invest in People and Appropriate Support Public Risk Insurance Agency (PRIA) Claims Coordinator Third Party Administrator (part of Workers Compensation RFP) Safety Committee, Safety Officer, Updated policy and procedures/training

31 RISK MANAGEMENT FUNCTION City Attorney s Office ((Safety Officer)) Safety Committee)) ALL Human Resources and Organizational Development Liability / Property (Fund 030) (Insurance Coverages; Broker Relationships; TPA and/or Specialisit) Org Policy Directives) Workers Comp (Legal; Strategic Decisions and Support; Quarterly Review) Workers Comp (Fund 050) (Administration; Claims/TPA; Quarterly Review; Pol & Procedures; Return to Work Program) Benefits Programs (Major Medical, Dental, Vision, Voluntary, incl. Vol Retirement; Wellness Team Leadership) Staffing: City Attorney Claims Coordinator Staffing Support: Safety Officer Chief of Police (Disaster Planning) Human Resources Staffing: Benefits Manager HR Coordinator

32 Three year strategy devised (attached). This year, focus upon: Compliance Affordable Health Care Act Quality and cost containment Evaluate and streamline vendors and products Explore opportunities for community partnerships Automate processes Focus upon prevention and individual participation Minimize health risks now to minimize health costs later Prepare for implementation of consumer driven plans Benefits FY13:FY14 Changes: 5% increase in overall premiums for Major Medical: Negotiated down from proposed 15% Coventry now purchased by Aetna

33 Annual Benefits Strategy Annual Compliance Review Year 1 (2013 / 2014 ) Create the Environment Develop a three year strategy, including tactical plans and long term goals Evaluate Current Plans and Programs Solicit employee feedback regarding current plan offerings EE survey Year 2 (2014 / 2015) Focus on Results Implement plan design changes and contribution strategy to support Year one implementation strategy Make appropriate vendor changes for all programs where necessary Select additional carriers to support three year strategy (i.e. health risk assessments, disease management, wellness) Run Health Care Reform Analyzer tool Year 3 (2015 / 2016) Facilitate Change Annually City of North Miami Beach Three Year Healthcare Strategy Annual Renewal Strategy / Annual Vendor Analysis & Market Review Make changes to Plan Designs where necessary Compare current carrier strengths and weaknesses Review all vendor contract and make any necessary changes and negotiate where possible. Incent employees to participate in Health Risk Assessment process and introduce wellness programs for modifiable risk factors with coverage penalties Determine reporting frequency and baseline for key areas of measurement defined in year one Plan financial performance and goals Utilization and Disease Management Make automated information available to employees Monitor Plan Designs and carriers make changes as necessary Evaluate feasibility of complete transition to CDHP Communicate results of year two efforts and continue to get collaboration to higher levels Look at and evaluate year 2 Wellness effectiveness Baseline analysis of peer groups Annual Enrollment & Communication Strategy Negotiate all contractual terms Voluntary Benefit consolidation Automation of enrollment process! Evaluate Benefit Admin systems & vendors Develop ongoing Employee Communication strategy Educate employees re consumer driven options, to prepare for following year Risk stratification high/medium/low Manage program, making sure that data from the health risk assessment and biometric screenings aids in identifying gaps in care & establishing intervention programs Co-Insurance versus solely co-pay based HMO Introduce CDHP plan Evaluate feasibility of implementing penalties for non compliance in wellness initiatives and modifiable risk factors Strategy planning at emerging market trends Evaluate value based benefit designs Annual Year End Review Coordinate and Conduct Health Fair Assess Results / Outcome Create an evidence based, total population health management strategy going forward Determine baseline/risk stratification Continue communication regarding progress with the strategy and any changes to be expected Continued monitoring and communication regarding PPACA Year end review vendor and plan performance Update / status of PPACA and it s impact Start planning for next three year cycle Year end review - vendor and plan performance Conduct year end review - vendor and plan performance

34 FY 2014 Budget Summary Ad Valorem Revenue Steady Operating Tax Rate Unchanged, Debt Millage lowered Focus on Services: Leisure Services and Library Police Department fully funded: COPS, CRA, LETF Officers ERP System Infrastructure and Beautification Proactive measures on Self Insurance and Workers Comp Professional assessment of our liability Health Care focus: quality and cost containment 34

35 FY 2014 Budget Thank you 35