Others Present: Interim City Manager Barbara Goodrich; City Attorney Sterling Solomon

Ms. Goodrich began a PowerPoint Presentation that covered the following:
 
RETREAT OBJECTIVES AND OUTLINE
COUNCIL GOALS AND OBJECTIVES CHECK IN
 
Deputy City Manager Shane Dille continued the presentation.

AGENDA
HOW DID WE GET HERE?
WHY THE MATRIX WORKS
HOW IS IT WORKING FOR YOU?
 
Council briefly discussed how the matrix is working for them and requested quarterly updates to the document. It was also suggested that an overview of the goals and accomplishments be published in CityScape.
 
Management Services Director Rick Tadder continued the presentation.
 
REVENUE UPDATES
CITY SALES TAX – GENERAL FUND
 
Mr. Tadder explained that the revenue team has put significant effort into updating the website and providing as much information as they can regarding the transition to the State collecting sales taxes.
 
Mr. Tadder also reported that construction has seen the largest growth in sales tax revenues. It is unsure how long that will continue so staff is documenting those as more of a one-time bump.
 
Mr. Tadder continued.
 
STATE SHARED SALES TAX
STATE SHARED INCOME TAX/URBAN REVENUE
FRANCHISE FEES
BUILDING PERMITS
BED, BOARD AND BEVERAGE (BBB)
HIGHWAY USER REVENUE (HURF)
 
Finance Director Brandi Suda continued the presentation.
 
AVAILABLE REVENUES AND FIXED COSTS
FIXED COSTS – PENSION
 
Councilmember Whelan asked how the pension fund became so underfunded. Ms. Goodrich offered that it was a combination of things; what has mostly impacted the situation is the under-realized investment earnings. When the anticipated interest earning estimates were not realized it increased contributions to compensate. Another factor was the result of two lawsuits that determined that moving the employee share from 7.65% to 11.65% was not permissible and then rolled back to 7.65% with cities and towns having to refund those contributions.
 
Mr. Tadder continued.
 
FIXED COSTS – HEALTH BENEFITS
REVENUE UPDATE SUMMARY – GENERAL FUND
FIXED COSTS SUMMARY – GENERAL FUND
 
A break was held from 10:32 a.m. through 10:44 p.m.
 
At this time public comment was received from the following individuals regarding the budget:

• Armando Bernasconi, Quality Connections

Human Resources Director Shannon Anderson continued the presentation:
 
BENEFITS
NAPEBT
HEALTH BENEFITS
NATIONAL TRENDS
NATIONAL TRENDS UTILIZATION VS. INFLATION
NATIONAL TRENDS COST MANAGEMENT STRATEGIES 2016 & 2017
NATIONAL TRENDS REGIONAL VARIATIONS
ARIZONA TRENDS
ARIZONA TREND MEDICAL PREMIUM COST SHARING FOR EMPLOYEE-ONLY
ARIZONA TREND MEDICAL PREMIUM COST SHARING FOR EMPLOYEE PLUS FAMILY
ARIZONA TREND MEDICAL PREMIUM COST SHARING
ARIZONA TREND ANNUAL MEDICAL PLAN DEDUCTIBLES
ARIZONA TREND OFFICE VISIT COPAYMENTS
ARIZONA TREND OUT OF POCKET MAXIMUMS
ARIZONA TREND PRESCRIPTION DRUG COPAYMENTS
NAPEBT TRENDS
NAPEBT RENEWAL
NAPEBT RENEWAL ADDITIONAL BENEFITS
WELLNESS
INCENTIVE PROGRAM
INCENTIVE PROGRAM SUCCESSES
NEAR SITE CLINIC
NEAR SITE CLINIC 2017 INITIATIVES
NEAR SITE CLINIC SUCCESSES
NEAR SITE CLINIC YEAR 2 ADDITIONS
BENEFITS – MATERNITY/PATERNITY LEAVE
PUBLIC SAFETY PERSONNEL RETIREMENT SYSTEM (PSPRS)
UNFUNDED LIABILITY STATUS
FY 2019 RATES AND COSTS
CONSIDERATION OF CHANGING AMORTIZATION PERIOD
PENSION POLICY DEVELOPMENT
WHAT ARE OTHER CITIES DOING
CONSIDERATION OF CHANGING AMORTIZATION PERIOD
STAFF RECOMMENDATION
 
Councilmember McCarthy asked what the amortization period is. Mr. Tadder stated that the expectation is to pay it off in a 20-year period.
 
Ms. Goodrich explained that the normal cost to support someone is about 15% versus the 85% the City has been paying to try and catch up.
 
Councilmember Overton stated that he would like to see the City be more aggressive in paying down the liability. He indicated that the City is currently maintaining and if another downturn hits this would be a $15 million budget item that is not negotiable.
 
A break was held from 12:22 p.m. through 1:00 p.m.
 
Mr. Tadder continued the presentation.
 
GENERAL OBLIGATION BONDS
HISTORY OF GO BONDS AUTHORIZED – 20 YEARS
GENERAL OBLIGATION BONDS
LEGAL LIMITS
SECONDARY PROPERTY TAX RATE
CAPACITY BASED ON CURRENT POLICY
 
At this time the following people addressed Council concerning the budget:

• Janet Regner, Coconino County Community Services

Housing Manager Sarah Darr continued the presentation.
 
AFFORDABLE HOUSING
SEVERAL TASKS, ALL RELATED SOMEHOW
AFFORDABLE HOUSING
COUNCIL GOALS
COUNCIL OBJECTIVES
COUNCIL PRIORITIES
USE OF CITY OWNED LAND
PLAN MOVING FORWARD
FUNDING
HISTORY – STUDIES/REPORTS
CONSISTENT RECOMMENDATIONS:
ECONA STUDY AND RECOMMENDATIONS
WHAT CAN YOU DO WITH A BOND FOR AFFORDABLE HOUSING?
 
After discussion a majority of Council agreed to have staff do further research concerning an Affordable Housing bond question on the November 2018 ballot.
 
Human Resources Benefits Analyst Jennifer Caputo continued the presentation.
 
2017 EMPLOYEE SURVEY
2017 RESULTS
AREAS OF SIGNIFICANT INCREASE
AREAS OF SIGNIFICANT DECREASE
AREAS OF NO SIGNIFICANT CHANGE
SUMMARY OF WRITTEN COMMENTS
NEXT STEPS Ms. Goodrich provided the following wrap up of the conversations:

• Council would like to find better ways to use the Council Priorities and incorporate them into the budget process.
• A majority of Council is interested in moving maternity/paternity leave forward for consideration.
• Council would like to continue with a 20-year amortization on the PSPRS unfunded liability.

The City Council Budget Retreat of February 12, 2018, recessed at 2:27 p.m.

Others present: Interim City Manager Barbara Goodrich and City Attorney Sterling Solomon.

Interim Police Chief Dan Musselman began a PowerPoint presentation that covered the following:
 
PUBLIC SAFETY OPERATIONS UPDATE
FPD PUBLIC SAFETY STAFFING CONCERNS
STAFFING LEVELS ARE NO LONGER ADEQUATE
RETENTION AND RECRUITMENT
INCENTIVES AND INVESTMENTS
 
Deputy Fire Chief Mark Wilson continued the presentation.
 
COUNCIL QUESTIONS FROM DECEMBER RETREAT
CALL VOLUME VS FTE
COMPARISON TO OTHER CITIES
JULY 2016-JULY 2017 CALL VOLUME DENSITY MAP
NUMBER OF PARAMEDICS – COMPENSATION FACTORS
TYPES OF EMERGENCY MEDICAL SERVICE (EMS) CALLS 2016
IMPACTS TO SERVICE DEMANDS
 
Councilmember McCarthy asked what types of calls are being responded to at NAU. Deputy Chief Wilson stated that they range from alcoholism, drugs, broken limbs, assaults and other disputes. He stated that they will often see a spike in service when the new school year begins and then it levels out; the same is true when a new facility comes online.
 
Deputy Chief Wilson continued the presentation.
 
FEASIBILITY OF REOPENING FIRE STATION 32
WHAT IS ALL OF THIS TELLING US?
SUMMARY
 
Deputy Chief Wilson stated that there is a need for at least nine new firefighters as well as additional staff in wildland firefighting.
 
Councilmember Overton asked if the reorganization from a few years ago is working or if there is one station carrying more of a call load than others. Deputy Chief Wilson stated that the stations that have lower call volumes are being utilized as needed for other areas; the intent is to get as many of them out responding to calls. The crews are rotated to slower stations because they are getting so burned out. The use of CART has helped in the response.
 
Councilmember Overton asked where the new firefighters that are being requested would go. Deputy Chief Wilson stated that the biggest impact with bringing them on would be the reduction in overtime costs and burnout because they are currently so understaffed.
 
Police Chief Kevin Treadway added that there is a different model for policing; they do not respond from quadrants but rather assign officers in the field to different beats. Those beats have not been expanded in the last 15 years and as the city continues to expand the need directly equates to officers. During the graveyard shift there is only one supervisor and five officers covering the entire city. The minimum staffing level has not changed but additional officers would allow them to add a squad during the high-volume times.
 
Chief Treadway added that they have tried everything keep officers in Flagstaff; he is not aware of any other police department that has not reinstated merit and the merit issue comes up again and again when officers leave. Councilmember Overton stated that if merit is the need then City Council needs to find ongoing money for merit. Those ongoing dollars are difficult to find and merit takes a large portion of that. He would like to see public safety as a priority for merits.
 
Wildland Fire Manager Paul Summerfelt continued the presentation.
 
WILDLAND FIRE MANAGEMENT (WFM) FLAGSTAFF WATERSHED PROTECTION PROJECT (FWPP) COMPLETION AND PROGRAM SUSTAINABILITY
THE SETTING
OUR INVESTMENT: THE CYCLE OF SUCCESS
THE GOOD NEWS
FWPP STATUS AND NEEDS
WFM SUSTAINABILITY
SUMMARY
 
Mr. Tadder continued the presentation.
 
WILDLAND FIRE MANAGEMENT FUNDING CONSIDERATION
POSSIBLE FUNDING
 
Fire Chief Mark Gaillard continued.
 
SUMMIT INTERGOVERNMENTAL AGREEMENT (IGA)
FLAGSTAFF FIRE DEPARTMENT (FFD) SITUATION STATUS
FEATURES OF THE IGA
OPERATIONAL BENEFITS OF THE ENHANCED SUMMIT IGA
FISCAL IMPACTS
SUPPORT FOR IGA
RECOMMENDATION:
 
A break was held from 3:03 p.m. through 3:12 p.m.
 
Chief Gaillard continued the presentation.
 
PUBLIC SAFETY RESEARCH GROUP (PSRG) RESEARCH
CONCLUSIONS
RISK MANAGEMENT WAS ADDRESSED
EXAMPLES OF BOTH AGENCIES SHARING RESOURCES
FISCAL ANALYSIS
QUID PRO QUO
 
Council briefly discussed the cost savings associated with partnering with Summit Fire and the benefits that it could provide.
 
Assistant to the City Manager Caleb Blaschke continued the presentation.
 
NATIVE AMERICAN STRATEGIC INITIATIVES
NATIVE AMERICAN AFFAIRS LIAISON
INDIGENOUS CIRCLE OF FLAGSTAFF
 
Mayor Evans stated that she recently met with the Indigenous Circle of Flagstaff (ICF) and one thing that they shared concerns that if the Liaison position had other duties as assigned that the meaning and purpose would be lost. They also expressed a need for a leader or Executive Director to focus on establishing an organization that could overlook and direct the implementation of a strategic plan.
 
Rose Tsosie addressed Council as a member of ICF and offered that they believe there is a better way to do this; they need the ability to establish a foundation or organization through a 501(c)3 who can move the plan forward and operate
 
Chris Jocks, also with ICF, addressed Council stating that the process needs to be community driven. The first objective is to make sure there is adequate representation in the community. ICF does support the City having a liaison to spearhead the program forward. He stated that the community needs to be involved in developing the job description as well as be represented through the selection process.
 
Councilmember Putzova left the meeting at 3:50 p.m.
 
Council had further discussion about the need for ICF to develop a non-profit agency to help with the collection and distribution of funds.
 
Ms. Goodrich continued the presentation.
 
SERVICE PARTNER CONTRACTS
DISABILITY PROVIDERS
 
Quality Connections CEO Armando Bernasconi addressed Council requesting that the Council direct staff to do research for short-term and long-term funding.
 
The Council discussed the chronic underfunding of the disability service providers by the State, and how the increase in minimum wage is further impacting their operations. They also discussed the need to treat the community fair and how singling out one specific service may present a challenge. Council discussed the possibility of the State to provide a funding match if the City were to provide the base funding and how they need to be cautious of dedicating financial resources before having all the proper information. Additionally, finding a revenue source for this direction will be important to ensure that the City’s base services continue to operate. The Council agreed to send a letter to the State seeking more information.
 
Ms. Goodrich continued the presentation.
 
RELOCATION ASSISTANCE FOR TRAILER PARK CLOSURES
 
Council discussed the possibility of the City establishing its own fund to provide this type of assistance for trailer park closures Council gave direction for staff to look at establishing a program and the legal aspects of doing so.
 
Code Enforcement Manager Reggie Eccelston continued the presentation
 
GRAFFITI ABATEMENT
GRAFFITI BUSTERS PROGRAM
            COMMUNITY BENEFITS
            FUTURE CONSIDERATIONS
 
A break was held from 4:55 p.m. through 5:03 p.m.

Human Resources Director Shannon Anderson continued the presentation.
 
COMPENSATION
MARKET BASED PLAY
PAY EQUITY STUDY  
Ms. Goodrich reviewed the areas she heard from Council that need to be brought forward during the next budget retreats.

• Police – increase personnel and stabilize retention.
• Fire – address service level concerns with the Fire Department
• Wildland Fire Management – leverage money the City has and engage community partners
• Native American Affairs – development of a one-year strategic plan and development of a group to accept funding from the City or outside organizations.
• Service Partner Contracts – provide a letter of support on the grant application to State for relocation of trailer assistance.
• Graffiti Abatement – provide additional funding to enhance the program.

The City Council Budget Retreat of February 13, 2018, adjourned at 5:27 p.m.