This coming Friday marks the third anniversary of one of the most momentous (to use a cliche‘) City Council meetings in Ocean Shores history. At the Jan. 14, 2008 meeting, council unanimously approved $24.5 million in interim financing for the Street LID project; and unanimously approved a resolution to set the Mayor’s salary at $500 per month. And, by a 3-2 vote (Creighton and Crumpacker, opposed), it approved the $4.7 million Fire Station. Excerpts from the minutes:

Related to a story in today’s North Coast News, on how some salaries have risen more than 30 percent, in less than five years. As noted in the story, Mike Styner has been the Fire as well as Police chief for more than a year; and the new Library director, based on how new hires are compensated, is paid significantly less than what Judy Stull (who retired at the end of 2009) would have been making :

exempt salaries 2009

Exempt Employees Contract 4-27-09-1

Exempt Employees Contract 08-09 9-12-07

Exempt Employees Contract 2005

Exempt Employees Contract 9-22-04

exempt salaries 2004

Small Cities Assistance Program

city manager contract

budget amendment sample Just some of the hundreds of thousands of dollars of last-minute shifting council approved on Monday night . . .

Recommendations, and city’s response from the State Auditor’s reports:

Recommendation

We recommend the City’s elected officials and management establish a formal, written comprehensive plan to address its financial condition. In addition, they should monitor and evaluate the City’s financial condition to ensure the plan is followed and the desired results are achieved. The plan should be revised as needed to resolve financial issues.

We further recommend the City’s elected officials establish and maintain debt repayment schedules to ensure repayment of the inter-fund loans.

City’s Response

The City concurs with the concerns outlined in the audit finding and recommendation. The City Council, management and staff are also very concerned about the City’s financial condition. As such, we are committed to working toward increasing revenues, reducing expenditures and rebuilding reserve balances. In 2010, the City took the drastic step of laying off 10 employees and requiring other non-public safety employees to take 27 unpaid “furlough” days. Also, in 2010, the City successfully sought voter

The State Auditor’s office today released reports on Ocean Shores.

Excerpt I:

The City continues to make expenditures in excess of its appropriations, putting it at risk of not being able to pay its obligations.

Description of Condition

During the 2006, 2007 and 2008 audits, we communicated concerns to City management regarding expenditures in excess of its appropriations. The audit for 2009 also found the City made expenditures in excess of its appropriations in seven funds, totaling $68,502, the largest being $37,698 in the Water Utility Fund.

We also noted concerns regarding the City’s financial condition during the 2006, 2007 and 2008 audits. These concerns continue.

The City’s ending cash balance for the General Fund continues to decline . . .

Excerpt II:

Debt repayment expenditures are 20 percent of the City’s budget. The City anticipates issuing a $45 million bond by the end of fiscal year 2010 to finance the cost of a Local Improvement District for street improvements. This bond includes refunding $39,689,914 in bond anticipation notes included in the figures in the table above. The $5 million difference between the $45 million bond and $39,689,914 in refunding the bond anticipation notes will result in a net increase in the City’s debt.

The City has issued inter-fund loans to 11 funds from the Water Capital Improvement fund to offset negative fund balances during 2007 through 2009. The City’s outstanding inter-fund loan balances are approximately $1.2 million as of December 31, 2009. Five of the 11 funds had a negative fund balance of $373,350 as of October 31, 2010.

In addition, the City did not properly authorize inter-fund loans, by Council resolution, to the Convention and Tourism Fund in 2007 and 2009 for $90,150 and $40,870, respectively. Furthermore, the City does not maintain debt repayment schedules for inter-fund loans.

Link to findings and reports

From p. 18 of the Proposed 2011 O.S. Budget, City Council total costs:

2008: $61,331

2009: $47,729

2010:  $46,957

2011:  $71,216

The biggest reason: $15,000 for equipment (a program to take minutes, apparently). The total is a 51% increase, over this year’s budget figure. Even without the $15,000 equipment addition, it would be a 20% increase, 2011 v. 2010.

City Council/Mayor plan: Cut General Fund budget by 5% = $274,980

My plan: Cut property taxes by 10 percent = $236,500

Hmmmm . . .

Lynn, Broadbent and Farra all wanted across-the-board budget cuts to create more reserve funds and/or help pay the Interfund Loans. Lynn and Broadbent asked for budget cuts of 5%. Farra wanted 20%, which Lynn and Broadbent thought was too much to ask for.

French: “We accept 5 percent. We’ll go do it.”

Asked for his input, Creighton said: “I got nothing.
This is the first year we’ve been shown every single thing in the budget. There’s