1990-14581-Minutes for Meeting April 18,1990 Recorded 5/21/199090-14551
MINUTES
l. o3 U1 19
BLACK BUTTE RANCH COUNTY SERVICE DISTRICT BUDGET COMMITTEE
April 18, 1990
Commissioner Throop convened the meeting. Budget Committee members
in attendance were Don Crouch, Jerry Moore, and Commissioners Tom
Throop and Dick Maudlin (Fred Ehman and Lois Bristow Prante were
unable to attend). Also present was Becky Lu Brown, Budget
officer.
1. ELECTION OF CHAIR OF BUDGET COMMITTEE
Fred Ehman was nominated to the position of Chair of the
Budget Committee. There were no further nominations.
Fred Ehman was elected chair of the Budget Committee by
unanimous acclamation.
2. PROPOSED BUDGET
Becky Lu Brown submitted the attached proposed budget and
budget report. She said that current service levels were
being proposed. They anticipated changes which would need to
be reviewed by the budget committee because they could result
in an increase in the rate per $1,000. Commissioner Maudlin
asked what those "anticipated changes" were. She said the
revenue they would receive from their contract with the Black
Butte Ranch Corporation had not been finalized, so they did
not have an exact tax rate figure at this time. Becky Lu
Brown asked that budget approval be tabled until after these
changes could be formalized.
Jerry Moore: I move for approval of the budget as stated.
Dick Maudlin: Second.
The motion was tabled until April 30 at 1:30-p.m.
BLACK BUTTE RANCH COUNTY SERVICE DISTRICT BUDGET COMMITTEE.,,,f
ABSENT ABSENT ,
Lois Bristow Prante
I
Tom Throop
Dick Maudlin
BOCC:alb
Fre Ehman, Chair
Don Crouch
Jerry Moore
miCROFiLME /
black butte ranch
association
Date: April 17, 1990
'I OIL - 0180
office memorandum / office memorandum / office memorandum
To: BBR Service District Budget Committee
From: Becky Lu Brown, Budget Office*
Subject: proposed FY 90-91 District Budget
Attached is my proposed budget for the newly formed Black Butte Ranch Service District
(BBRSD).
The resources listed reflect the transitional status of the first fiscal year, when BBR
Association dues that have been collected for Safety Services operations are transferred to
the district. The other significant non-tax income source is from the BBR Corporation; it is
anticipated that the Corporation will contract with the District for special services outside the
scope of routine services to be provided by the District, i.e. bank deposit escort services.
The expenditures reflect budget needs to maintain existing service levels provide by BBR
Association Safety Services. There are currently six officers, including the Chief;
administrative and management services will be provided by contract.
Capital outlay requirements include $34,000, which represents the estimated value of assets
to be acquired by the district July 1st, and $12,000 for replacement of one patrol unit.
The assessed value of the district is estimated to be $134,895,637. This translates into a tax
rate of $1.57 per $1,000/value for BBRSD REq2gty owners; there are, however, anticipated
ccfianges to review y e u get committee which ould result in a first year rate of
$1.71 per $1,000/value.
Historical data has not been provided, since this is the first fiscal year under district funding.
The authority to levy the taxes required in this budget proposal is contingent upon approval
of the tax base request submitted for the May 15, 1990 ballot.
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T T'4
black butte ranch association April 1990
Black Butte Ranch Service
District Tax Base Summary
You were all kept informed of the
successful effort to obtain legislation
which would allow Black Butte
Ranch to form a Service District that
could eventually provide many ser-
vices. As always intended, the Ser-
vice District will start by incorpo-
rating the Safety Services--or as it
will now be designated-Black Butte
Ranch, Department of Police. Before
any other services are added to the
district, a comprehensive study of
potential benefits would be conduct-
ed, and any expansion of services
would require approval by the BBR
Association.
Some of the anticipated benefits of
the Service District:
returning to an equitable funding
method based on property val-
ue, as previously established
by the Fire District.
reduced liability exposure
within the governmental dis-
trict:
- qualifies for protection un-
der public body tort liabil-
ity limits.
- anticipated reduction in
insurance costs.
- greater availability of in-
surance coverage.
the Department of Police is a
separate unit with more direct
management and support
The District budget sub-committee
has worked for months to put togeth-
er this proposed Fiscal Year (FY) 90-
91 budget. It has been structured to
accommodate full operating status
for the district without requiring any
outside financing, mostly due to the
transfer of dues. Our preliminary es-
timate is that the FY 91-92 levy
should be less than this first year.
The proposed first year budget is
$343,665, of which $196,437 would be
tax supported. With an estimated
tax rate of $1.71 per $1,000, the No-
vember 1990 property tax on a home
valued at $125,000 would be $213.75.
As a new district, the first two
years of operation will require funds
over and above the cost of opera-
tions, due to the transfer of assets,
contingencies and cash reserves.
These costs are currently absorbed in
the Association budget, and do not
reflect in the Safety Service depart-
ment costs. Recognizing that the
transfer of operations from the Asso-
ciation to the District involves sev-
eral financial considerations, the
following definitions are provided to
assist in understanding how such
transfer will take place.
Tax Base
The District must get voter ap-
proval for authorization to assess a
certain amount of funds each fiscal
year. The district is requesting a tax
base of $385,165, which is calculated
to provide adequate room for infla-
tion factors and total district funding
for several years without another
vote. This amount, once levied in
full, can be increased up to six percent
each year without voter approval.
Tax Levy
The district must follow Local Bud-
get law, which provides a process of
committee involvement, publication
and public hearings annually, to de-
termine the fiscal year levy. This is
the actual amount of tax required to
balance the budget each year, and
continued on page 4
Take precautions
when burning
Although the Fire District's news-
letter of Oct. 25 described a much
shortened open burning season for
1990, the department failed to re-
mind owners after the first of the
year. This lack of communication has
been justifiably criticized; and in re-
sponse, the department has extended
the season to May 15.
The fire department would prefer
the disposal of trimmings and ground
fuels at the refuse pit, but recognizes
there are property owners who
would rather burn on their property.
If you choose to burn, please be aware
of the inherent danger to your prop-
erty and that of your neighbors.
Please be considerate of those with
respiratory problems and try to
avoid burning on breezy days.
With the weather as warm as it is
and the lack of moisture this winter,
owners are cautioned to use extreme
care in any open burning. The burn
sites need to be more that ten feet
from any combustible material and
caution must be used in assuring that
stumps or dead root systems are not
ignited because the fire may travel
to another location up to a month
later.
Burning permits may be picked up
at the fire station any day from 8 am
to 5 pm. Permits will be required
through the remainder of burning
season. Those with permits currently
expiring April 15, will be automati-
cally granted extensions to May 15.
Remember: everyone must notify the
fire department at 595-2288 on the
day of burning.
• Black Butte Ranch Service District Tax Base summary
continued from page 1
cannot exceed the approved tax base.
It is anticipated the tax levy will be
substantially less than the tax base
for several years, unless other servic-
es are incorporated into district oper-
ations. The taxes levied for FY 90-91
(the first district year) would be col-
lected beginning November 1990.
Expenses
Assets Transfer: It is estimated
that the physical assets (equipment,
cars, supply inventory) will be val-
ued at $34,000 as of July 1, 1990. The
District must compensate the Associ-
ation for these assets; this represents
a one-time cost to the district tax-
payers assessed in FY 90-91.
ContingencX: Just as it sounds, these
funds ($21,060) are needed for unex-
pected expenses that might be in-
curred through the course of the
year. The Association's operating
budget for Safety Services has not in-
cluded a proportionate amount of
contingency, which is shown in the
Association's budget as a lump sum.
Unal2l2ropriated Ending Fund Bal-
ance: Besides making sure that the
District can operate within the bud-
get presented, the actual cash flow
must be considered. Local Budget law
requires districts to establish this
Ending Fund Balance (UEFB) to
make certain there is enough cash for
the following fiscal year to keep the
district operating until the tax mo-
nies are once again collected. For this
first year's levy, the UEFB ($66,000)
will establish this cash reserve that
becomes operating cash as of July 1,
1991. Eventually, actual cash re-
serves should offset the bulk of this
expense item.
Uncollected Taxes: Another re-
quirement under Local Budget law
calls for assessing more taxes than
will actually be needed to support
the District for the current year.
This is due to delinquent or uncollect-
ible taxes, and the collection rate
varies from county to county. Histori-
cal data is distributed that indicates
an "average" collection rate for De-
schutes County at about 85%a each
year. This doesn't mean the district
loses the other 15% ($34,665) com-
pletely, but will not be available in
the current year. The impact of this
delayed collection is greatest in the
first year, when there is no revenue
from previously levied taxes to off-
set this expense.
Operations and Capital Outlay:
The Association budget allowed the
addition of one officer position for a
total of six, including the Chief. The
District budget supports the current
service level, including replacement
of one patrol car ($12,000) in capital
outlay.
The graph illustrates the impact
of the first-year expenses (see fig. 1).
The Association budget for Safety
Services reflects only the operations
and capital outlay costs directly,
and some contingency through its to-
tal reserves. The assets transfer, as
previously explained, is a one-time
cost; the uncollectibles and UEFB are
continuing expenses, that must be
built in to the tax structure, but
which will have partially offset-
ting revenues in subsequent years (see
fig. 2). The revenue graph shows the
majority of district services support-
ed by taxes, as proposed.
Expenditures
FY 90-91 Budget
UEFB
56%
(labor,
Revenues
Figure 1
Corporate Support: The tax base
that you will be voting on in May is
adequate to provide all revenue ne-
cessary to maintain the Dept. of Po-
lice at its current service level. For-
tunately, the District can anticipate
a major contribution from the BBR
Corporation, which will allow the
district to levy only a portion of the
tax base, if approved. The Corpora-
tion currently supports 40%a of the
Safety Service operating budget. By
contracting with the District for spe-
cial services, the Corporation will
continue to provide a comparable
amount, in addition to paying its
share through property taxes.
Revenues
FY 90-91 Budget
Other Income
1% (interest on investments etc.)
Assoc
Corpora
24%
57%
is levied
years)
Association Dues: The Association
collects a portion of monthly general
fund dues for Safety Services, and
will continue to do so through De-
cember 1990. Those monies represent-
ing Safety Services costs between
July 1 and December 31, 1990 will be
transferred to the District, offsetting
a significant portion of taxes neces-
sary for the first year. Approximate-
ly $100/year of each property own-
er's general fund dues goes to support
Safety Services. The Association
Board will have to decide how much
the 1991 dues may be reduced since
operations funding of the service has
been transferred to the Black Butte
Ranch Service District, in addition
to a proportionate share of support
expenses like legal fees, management
services and previously unallocated
supplies.
A Town Hall meeting will be held
on Saturday, May 5th beginning at
10:00 AM at the fire hall. We will
try to answer any and all questions
then. If you cannot attend, or have
questions prior to the meeting, please
direct to the Association office and
we will try to respond.
Pat Fordney, Chair Managing Board
Black Butte Ranch Service District
-4-
1
x
Figure 2
Capital Outlay