Presentation of the Fiscal Year 2018 Proposed Operating Budget and Capital Improvements Program (CIP)
Staff recommends that the Mayor and Council receive the presentation on the Fiscal Year 2018 Proposed Operating Budget and Capital Improvements Program.
FY 2018 Budget Overview
The Fiscal Year 2018 Proposed Operating Budget and Capital Improvements Program utilizes available resources in an effective and responsible manner, and is consistent with the policy direction set forth by the Mayor and Council. The budget focuses on the health and safety of our residents, business owners, and employees; critical infrastructure improvements; and City programs and services.
The total operating budget for all funds equals $129.4 million, an increase of 2.5 percent over last year’s total operating budget. The General Fund budget, which is balanced without the use of reserves, equals $79.2 million, an increase of 2.6 percent over FY 2017. The property tax rates of $0.292 for real property and $0.805 for personal property will remain the same for FY 2018.
Attachment A and Attachment B describe some of the major items that are funded in the FY 2018 budget. Highlights or major enhancements include:
- Three Full-Time Police Officers ($315,210; of which $40,200 is one-time for uniforms, academy training, and equipment)
- Dedicated School Resource Officers in all three Rockville High Schools (cost neutral)
- Additional Police Overtime ($40,470)
- Cell Phone Stipends for Police Officers ($23,760)
- Water Treatment Plant, Filter Press Repair ($192,280)
- Water Backflow Inspection Program ($36,000)
- Sewer Cleanout Installation and Lateral Replacement ($78,000)
- Rockville Swim and Fitness Center, Filter Tanks and Pool Pumps ($61,000)
- Water Barricades for public events ($9,920)
- Senior Needs Assessment Action Plan Items ($42,600)
- ADA Program Requirements ($27,460)
- Additional Contract Tree Maintenance ($47,000)
- Purchase of WSSC Water ($92,780)
- Maintenance of 175 Watts Branch Parkway ($11,020)
- Consultant Services for Streetscape, Planning, and Urban Design ($175,000)
- Upgraded Timekeeping System ($25,200)
- Rocktobierfest ($37,710)
- International Night ($4,950)
- House Bar Lights for the F. Scott Fitzgerald Theatre ($95,000)
- Extended Summer Camps ($49,090)
- Additional Fitness Pool Hours ($11,500)
The total number of full time equivalent (FTE) positions in the FY 2018 operating budget remains relatively flat, only increasing by 0.2 FTEs to 609.5 FTEs. For regular positions, FTEs increased by 0.5 to 517.9 FTEs, which is the net change from the addition of 3.0 FTE Police Officers and the elimination of 1.0 FTE Assistant to the City Manager, 1.0 FTE Television Production Specialist, and 0.5 FTE Video Technician. All the eliminated positions were vacant.
During FY 2017, two Police Officers were reallocated from the Speed Camera Fund to the General Fund via a mid-year budget amendment. In addition, one Photo Enforcement Technician was reallocated from the Speed Camera Fund to the General Fund in the FY 2018 budget. Given the reduction in the number of speed camera citations since the inception of the program, and the consequent reduction in speed camera revenues and related workload, there is no longer sufficient funds available to support these positions. These reallocations did not change the total FTE count for all funds.
Capital Improvements Program Overview
The FY 2018 CIP budget includes new funding of $19.9 million to address the priorities of the Mayor and Council and residents of Rockville. This new funding combined with prior year carryover funding of $47.2 million, will support a total of 47 projects in FY 2018. There are eight newly-funded projects, which include:
- Lincoln Park Community Center Parking Lot Expansion (RB18)
- Potomac Woods Community Center concept design and outreach (RD18)
- Senior Center ADA Improvements (RE18)
- Traffic Signal Communication System (TA18)
- Stream Restoration: Anderson Park (SA18)
- Water Treatment Plant Concrete Roof Repairs (UA18)
- Water Treatment Plant Electrical System Upgrades (UA17)
- I-Net Security Enhancements (GA18)
The City is able to fund the Mayor and Council’s priority initiatives and new capital projects due to Rockville’s stable revenue base and conservative financial management policies. Based on current data from the State of Maryland and Montgomery County, Rockville projects a total combined increase of $2.5 million in property tax and income tax revenues from what was adopted in FY 2017. The increases in these revenue sources are evidence of our region’s strong housing market, low unemployment rates, gradual wage growth, and general state of the economy. Property tax and income tax revenues make up over 68 percent of the General Fund budget. We are projecting that the General Fund unassigned fund balance will continue to exceed the City’s policy target of 20 percent of proposed FY 2018 revenues.
Although the City’s financial outlook is positive, we, along with many other jurisdictions in the Washington DC metro area, remain cautious about changes that might result from the new federal administration. Staff will continue to monitor the local environment and adjust for any factors that might impact the City’s key resources.
Mayor and Council History
Past Mayor and Council actions related to the FY 2018 budget include:
| September 12, 2016|| Discussion of Operating Budget Process |
| September 19, 2016|| Discussion of Capital Improvements Program (CIP) Budget Process|
| October 11, 2016|| Distribution of Mayor and Council Budget Surveys |
| November 1, 2016|| Budget Public Hearing |
| November 10, 2016|| Mayor and Council Budget Surveys Due|
| December 12, 2016|| FY 2018 Budget Survey Results and Discussion of Budget Priorities|
| January 9, 2017|| FY 2018 Cost Allocation Plan (CAP) Presentation|
| February 13, 2017|| Distribution of FY 2018 Proposed Budget|
Public Notification and Engagement
The City held the first public hearing related to the FY 2018 budget on November 1, 2016. The remaining public hearings are scheduled for March and April 2017.
In addition to the budget public hearings, the public can submit written comments about the budget via an online form located on the City's website at www.rockvillemd.gov/budget. These comments will be distributed to the Mayor and Council at the close of the public comment period and will be included with the agenda materials for the final budget worksession.
The public comment period closes on April 7, 2017.
Boards and Commissions Review
The Financial Advisory Board will meet several times during the FY 2018 budget process to review the FY 2018 operating budget and CIP, and develop recommendations for the Mayor and Council. One or more members from the Financial Advisory Board will be available for at least one of the Mayor and Council's budget worksessions to present and discuss the Board's recommendations for FY 2018.
Future Mayor and Council actions related to the FY 2018 budget include:
* All dates are subject to adjustment by the Mayor and Council during the budget process.
| February 27, 2017|| City Manager's Presentation of FY 2018 Proposed Budget;|
Introduction of FY 2018 Budget Ordinance;
Introduction of FY 2018 Refuse Fee Resolution;
Introduction of FY 2018 Stormwater Management Fee Resolution
| March 2, 2017|| Mayor and Council Worksession |
| March 6, 2017|| Public Hearing|
| April 3, 2017|| Public Hearing;|
Constant Yield Tax Rate Public Hearing;
Mayor and Council Worksession
| April 7, 2017|| Close of Budget Public Record|
| April 17, 2017|| Mayor and Council Worksession |
| May 1, 2017|| Adoption of FY 2018 Budget Ordinance;|
Adoption of FY 2018 Refuse Fee Resolution;
Adoption of FY 2018 Stormwater Management Fee Resolution
Attachment A - Letter from the City Manager
Attachment B - Budget Highlights
Gavin Cohen, Chief Financial Officer
Approved on: 02/22/2017
Robert DiSpirito, City Manager
Approved on: 02/22/2017