1. The pet of the week (Chihuahua) was presented.
2. Item # 3 Budget Strategies for Fiscal Year 2012 was moved to the top of the agenda at the request of Councilor Connor. Dick Gerhart, Financial Services Department made a presentation and suggested that the $4.3 million Additional Managed Reduction (AMR’s ) is working even though it does not target individual line items. He proposed that the AMR’s become permanent and that more are needed. He believes the economic recovery has begun in Las Cruces and, unlike the rest of the state, is experiencing job growth. The Department is forecasting for the period FY 2011-2016 a 4.7% annual growth rate, annual City salary increases of 2.8% with a 5.8% annual increase in benefits (total 8.6% annual increase in employee costs), Editorial note: Since here will be no Federal Cost of Living increases again next year why is the City proposing pay increases?, 2 new employees per year, and that no new facilities (fire or police stations, etc) will become operational. The assumption is that there will be no changes in the current tax laws. The current 5-year forecast calls for $69 million in spending with only $26.8 million in revenue. This leaves a budget shortfall of $42.2 million ($8.44 million per year). The Department is advocating using $7 million (approximately half of the City reserve fund) to mitigate the shortfall until the economy recovers. He suggested that the City consider the following budget strategies which included line item budget cuts, salary reductions, reduce or eliminate community event sponsorships, reduce printing/advertising/translation services, eliminating City positions/travel/training, consider reorganization and consolidation, reducing transit on weekends/holidays, close the Life Center & Club Fusion, mandatory furloughs, limit school resource officers, reduce hours of the libraries and museums while increasing their fees, reduce street lighting, and privatize or contract for selected City services, impose fees for repeated false alarms.
· Councilor Connor commented that City revenues show an increase but it was actually caused by decreased City spending. She believes the City needs to consider budget offsets by higher paid retiring city employees and any new full-time employee hires. She said the City has done a good gob in restoring the reserve account and is concerned that it may be reduced to minimum levels. She said the proposed reductions over 5-years were feasible but over one year would be devastating and that Public Safety must remain the top budget priority. The City should look at not filling retirement positions, consider early retirement options. She wanted to know if paid time off could be reduced since City has more paid holidays than either the County or the State. City employees receive up to 160 hours of vacation, 96 hours of sick leave, 16 hours of personal time, and annually converting unused comp-time to paid time.
· Councilor Thomas was more concerned with the process and needs more information to make any decision. She wants to be able to evaluate the value of any employee cuts versus another employee and that the Council needs to establish some principles for employee reductions.
· Councilor Silva wanted expenditures versus revenue chart added to the quarterly update packet.
· Councilor Sorg was having difficulty understanding the data and the job growth comments. Mr Gerhart explained the data reflects job growth every month since May. Councilor Sorg was concerned that Community Development Department work effort has significantly been reduced without reduction in full time employees. He thinks in the next 5 years we will have higher than the projected annual 4.5% growth. He also wanted to know if the projected 2 new employees per year included the Police Department and was informed it did. He thought the proposed reductions were extremely ambitious and agrees that principles need to be established. He also wants Public Safety to be preserved.
· Councilor Small said we are experiencing a period of slow steady growth but wanted to know what characterized General Fund growth over the past 5-years. He was informed that is was primarily increased City staffing. He wanted to know if some City programs and their staffs would be eliminated and was told YES. He wants all affected parties to be involved in any discussions to eliminate their programs. He advocates keeping prudent but not excessive reserves to preclude cutting programs. He wants to City to pursue early retirement options instead of elimination of program staffs.
· Councilor Pedroza was concerned about the assumption that there would be no changes in tax policy. Mr Gerhart acknowledged that repeal of the “Hold Harmless” tax provisions on food and medical will adversely impact this strategy by approximately $8 million annually. She agreed that the public should have input into which programs are eliminated. She wants to protect the most vulnerable citizens from program cuts and said you can’t cut summer recreation programs because the impact working parents and you can’t cut seniors programs.
· Mayor Miyagishima agreed the City needed to protect public safety, roads & transit, parks, and children and seniors. He suggested that flex time could save the City money. His proposal would impact approximately 2% of the City staff who would take a 10% salary cut to work at home. He contends that this would result in savings to the City and a net increase to the employee who would save the commute costs and child care expenses. Editorial note: How much work can the City expect from an employee who is at home watching her/his children? He was informed that the currently technology in the new City Hall will not accommodate this without software and system upgrades. He also said that most homeowner insurance policies cover $500 fees for fire department calls and perhaps we should impose this on the citizens. There will be another work session in November to discuss the budget.
3. Item # 1 – Downtown Camunez Building Proposal. This is a joint effort between the Dona Ana Arts Council and the Downtown Las Cruces Partnership to take ownership of the old Camunez Building. This building in the Main Street downtown mall area is currently owned by the State and can be transferred to the City and then to a non-profit entity. They want to renovate it into a “Mercado” to incubate Farmers Market vendors, small businesses and film/media technology clients. It is a no risk project for the City and funding will come from Federal and State grants and private partnerships. The Council supported the proposal and while the City cannot offer any funding it will use the City lobbyist to help secure Federal and State funding. They commented that this was an “economic gardening” project and would result in better growth than “fishing” for big businesses.
4. Item #3 – Revisiting RV Parking Regulations. Mayor Miyagishima put this item back on the agenda because he is concerned about people living in their RV’s and potential safety issues for the fire department. It was obvious from the beginning that the Mayor and the Council did not feel the recently passed ordinance was restrictive enough. Fire Chief Brown said it was not an issue for the fire department as long as one side of the residence provided rear access for firefighters. The Mayor wants to impose side yard setbacks (editorial note: This would essentially eliminate RV parking on sides of homes) and he would prefer that RV’s only be stored in the backyard. Additionally, he would like to limit them to 72 hours parking on the street revoking the current ordinance of two weeks. Councilor Thomas and Councilor Sorg both are not satisfied with the current ordinance and advocate more stringent controls. Mayor Miyagishima directed the staff to prepare a new ordinance based on the comments during the meeting.
5. Item #4 – Global Spectrum Convention Center Annual Report. Since the Convention Center is not yet open for business the report centered on restating the policies and expectations of Global Spectrum in support of the City of Las Cruces.
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