FY 2020 Budget in Brief

City of Gulf Breeze BUDGET IN BRIEF FY 2020 PAGE 1

City of Gulf Breeze, Florida Fiscal Year 2020 Mayor and City Council Tom Naile Cherry Fitch Todd Torgerson Mayor Pro Tem Mayor Councilman JB Schluter Randy Hebert Councilman Councilman City of Gulf Breeze …will preserve and enhance its hometown character and natural environment to foster a high quality of family life. PAGE 2

Introduction The Budget-In-Brief highlights important aspects of the FY 2020 proposed budget for review. The complete budget document is also available on the City website, and available for view in the City Clerk’s Office. The new Mayor and City Council are embarking on a 5-Year Strategic Plan for building Community Resiliency. The FY 2020 Spending Plan utilizes available resources to prepare and recover from adverse situations by engaging and benefitting all community members. Efforts to build community resilience focus on building the capacity to “bounce back” from disruptions, like those caused by natural disasters and growth pressures. The City of Gulf Breeze’s Fiscal Year 2020 proposed budget totals $38,228,189 and incorporates the same low millage rate of 1.9732 as the last several years. Utility rates adjust for the previous 12-month inflation index. There is an additional increase to the Municipal Public Service Tax and Communication Service Tax to bring these two user fees closer to the three-County regional average, yet still lower. The City of Gulf Breeze 2020 budget funds the largest, most significant projects remaining from the stormwater master plan. Of the $7.7 million in citywide prioritized after the 2014 flood, $1.5 million remains after this FY2020 budget. The budget also completed the majority of “Most Livable City Projects,” which carry forward from the previous year and were originally ranked by public survey. Mayor and City Council held budget work sessions on 5 occasions: Mon July 22 General Fund Budget Overview Mon July 29 Setting of the Proposed TRIM Mon Aug 5 Continuation of General Fund and also Funds: Stormwater, Solid Waste, Red Light, Tourist Development Aug 19 Community Redevelopment Area Aug 26 Enterprise Funds: Natural Gas, Tiger Point Golf Course Enterprise Funds: City Water & Sewer, South Santa Rosa Utility Public hearings on the budget will be held on Wednesday, September 4th and Monday, September 16th, to tentatively and finally adopt the budget. Both hearings will be held at 5:30 PM in City Council Chambers. In service, Samantha D. Abell City Manager PAGE 3

Overview of City Funds The City’s fiscal year begins October 1 and ends September 30. Each year, the City Council approves a budget that funds operations and capital expenditures. City monies are budgeted and accounted for in several different “funds.” This allows monies which must be spent for certain purposes to be separated and indicates the full cost of certain City operations. The City maintains five individual governmental funds (General Fund, Urban Core Redevelopment Fund, Red Light Special Revenue Fund, Tourist Development Special Revenue Fund, and Police Department Special Revenue Fund). The General Fund incorporates the General Government (Administration), Internal Services, Streets and Drainage, Parks and Recreation, Police Department, Fire Department, Community Center, and Community Services (Code Enforcement) Units. Proprietary or Enterprise Funds maintained by the City include the City Water & Sewer Fund, Natural Gas Fund, South Santa Rosa Utility Fund, Gulf Breeze Financial Services Fund, Solid Waste Fund, Stormwater Management Fund and Innerarity Point Utilities Fund. The Enterprise Funds account for the full cost of operations, maintenance, debt and capital improvements of City operated “businesses.” Recap of Proposed Budget This year’s budget emphasizes sound fiscal management and sustainability while maintaining the very low millage rate of 1.9723. No General Fund reserves (savings) are used for annual operating costs. Signs of a strong economy: Ad valorem is projected to increase by 7%, non-ad valorem taxes by 19%, grants by 5%, and sales revenues by 12%. The General Fund budget of $11,794,741 is $92,894 or only .8% more than the adopted FY 2017-18 budget of $11,701,847. The FY 2019-20 overall budget of $38,228,189 is $5,323,444 or 16.3%, more than the original adopted FY 2018-19 budget of $32,864,748 (which was 385,531 or 1.2% greater than the adopted FY-2017-18 budget). The overall FY 2019-20 budget, like FY 2018- 19, is significantly higher than prior years due largely to the carryover of major Enterprise Fund capital projects underway. Revenues continue to grow as a sign of a healthy, rebounding economy. Six Months Operating Reserves As a component of the City’s focus on resiliency, the City maintains at least 6- months of cash reserves in investments, or a minimum of $9 million, for all major operating funds in case of a natural disaster. PAGE 4

Stormwater The FY 2020 budget includes $3,426,329 for stormwater improvements, including $2,700,000 for stormwater projects on Bear Drive and the East Basin. The West Basin project which benefits the larger Gilmore area, has complete design plans and is awaiting RESTORE grant funds this year or next. Stormwater Background In 2014, the City responded to a historic flood which exceeded a 500-year flood event by creating a stormwater task force and prioritizing major stormwater improvements in all the City’s drainage basins with an estimated cost of $7.7 million. After FY2020, there are only $1.5 million in projects remaining, with timing and costs tied to grant funds. “Most Livable City Projects” and $5.9 Million in FDOT Funds In 2016, the City set aside $3 million of the $5.9 million paid by FDOT for a portion of Wayside Park for the Pensacola Bay Bridge Replacement. This $3 million was invested and has earned $200,000 to date. The remaining $2.9M in FDOT funds paid for what’s collectively called the “Most Livable City Projects,” which were projects ranked by citizens in 2018, pulled from the pages of the City’s Most Livable City Masterplan. ½ Cent Local Option Sales Tax (LOST) Projects and Resurfacing Roadways The City receives just under $300,000 annually from the ½ cent sales tax (LOST). It costs exactly that to pave one mile of road. Gulf Breeze has a 15-year resurfacing plan. FY 2020 will fund 3.5 miles of roadway, a 20% increase of paving from FY19. LOST funds consist of 35% visitor dollars, therefore it’s a great way to fund local roadways and sidewalks while keeping taxes low. FY 2020 marks the third year for LOST, which sunsets 2021. The October 8th Penny Referendum, if approved, will allow the City to fund twice as much road resurfacing simultaneous with drainage improvements, and also construct new neighborhood sidewalks. The total generated over 10 years would be $6 million, or $600,000 annual. If not approved, the current ½ cent sunsets in 2021. Paving funding sources: Local Option Gas Tax (LOGT) = $234,000 annual County Gas Tax = $315,000 annual ½ Cent Local Option Sales Tax (LOST) = $300,000 annual PAGE 5

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FY 2020 City of Gulf Breeze General Fund Summary of General Fund Revenues Description FY 2019 Original FY 2019 Amended FY 2020 % Change to Adopted Budget Amended Budget Budget Request FY19 AD VALOREM 1,281,198 1,281,198 1,365,510 7% NON AD VALOREM TAXES 2,014,100 2,014,100 2,391,028 19% GRANT & INTERGOV REV 5% 750,635 795,664 831,594 -5% FINES & JUDGEMENTS 135,563 135,563 128,263 12% SALES REVENUES 643,390 643,390 718,628 68% 127,591 129,191 216,553 -32% INT RENT & MISC REV 3,228,306 3,865,197 2,619,645 0% BUDGETED RESERVES 2,521,064 2,521,064 2,523,520 0% INTERFUND TRANSFERS 1,000,000 1,000,000 1,000,000 CTA COUNTRIBUTION -5% - - 11,794,741 TOTAL REVENUES 11,701,847 12,385,367 Summary of General Fund Expenditures Description FY 2019 Original FY 2019 Amended FY 2020 % Change to Adopted Budget Amended Budget Budget Request FY19 PERSONNEL PAYMENTS 3,335,760 3,364,786 3,188,292 -5% TAXES & BENEFITS 1,246,020 1,252,734 1,216,091 -3% 1,006,547 1,049,572 -17% PROF & CONTRACT SERVICES 1,725,080 2,214,328 875,304 7% OPERATION & REPAIRS 2,377,100 -7% SUPPLIES & EXPENSES 555,711 599,001 -61% CAPITAL EXPENDITURES 2,808,200 2,839,662 559,865 276% TRANSFERS IN / OUT 1,111,320 1% DEBT SERVICE 466,093 506,098 1,904,201 558,436 559,186 562,568 TOTAL EXPENDITURES 11,701,847 12,385,367 11,794,741 -5% PAGE 7

Major Fund Highlights – FY 2020 Spending Plan: All Funds – The FY2020 budget includes a wage “true up” to the regional wage average for all positions below department head level. For those positions already earning the regional average, the annual raise is budgeted at 3%. The adjustment is based upon a compensation study, the first conducted in seven years. General Government – .79% (less than 1%) increase from prior year. The General Government budget includes City Hall structural repairs and ADA bathroom renovations. Streets and Drainage – 7 streets, totaling 3.5 miles of roadway, including McLane Road, Laura Lane, Madrid Avenue, Fairpoint Place, Smith Circle, Highpoint Drive, Plantation Hill Road, and Bear Drive. Funded by LOST and LOGT. Parks and Recreation – $207,000 in projects including Highpoint Tennis Court reconstruction, Woodland Park improvements, turf maintenance equipment, and a new outdoor basketball court. Community Redevelopment Area – 55.58% increase from prior year (special fund comprised of 80% County/20% City funds). Projects include Andrew Jackson Streetscape, undergrounding utilities on Highway 98, Commercial Façade Improvement Program, partial funding for Fairpoint-Shoreline Multi-Use Pathway, and additional beautifications. Law Enforcement - Includes partial funding for a new police department annex at the existing location on Fairpoint Drive, as well as three new patrol vehicles. Fire Control – Includes replacement of firefighting equipment and continued volunteer stipends with increased tuition reimbursement. Recreation Center – Includes security system upgrades and continuing to expand programs for the Middle School After School Program and Summer Programs. Tourism Development Fund (hotel bed tax) – 30% increase in revenues. Defrays costs of tourist-oriented parks and piers, and funds new wayfinding signs, and sports tourism efforts. Other Notable Fund Highlights (Enterprise Funds): Solid Waste – .67% increase (less than 1%). Annual CPI adjustment applied. Overall solid waste, recycling and yard waste service remains higher at significantly lowers costs than neighboring communities. Stormwater – 306% increase from prior year, or $3,426,329 total spending. Includes $2.7 million dollars for Bear Drive and East Basin projects, funded 50/50 by City cash reserves and 20-year financing. Annual CPI adjustment applied. Natural Gas – 23% increase from prior year. Sales revenues for FY 2020 are projected to increase by 7%. The budget includes capital projects to meet customer demand east of the City and on the island. Annual CPI applied. PAGE 8

City Water & Sewer –4% decrease in spending from prior year. The City has engaged a firm for a comprehensive utility study, in consideration of long-term maintenance and replacement needs for infrastructure. Annual CPI applied. SSRUS – 8% increase in spending from prior year. The budget includes a portion of tap fee reserves in order to continue the Waste Water Treatment Facility Expansion Project design, lift station refurbishment, water main upgrades, and inflow & infiltration/sewer main replacement. Annual CPI applied. Tiger Point Golf Course – 9.22% increase in budget spending due to proceeds from driving range sale and relocation, necessary to continue property improvements. A budget amendment is anticipated with the sale of 45 acres to the school district in FY 2020. PAGE 9

General Fund FY 2019 VS 2020 Departmental Budget 2019 2020 0100 - General Government 0100 - General Government PERSONNEL PAYMENTS 690,595 PERSONNEL PAYMENTS 329,551 TAXES & BENEFITS 198,213 TAXES & BENEFITS 86,447 PROF & CONTRACT SERVICES 213,918 PROF & CONTRACT SERVICES 250,500 OPERATION & REPAIRS 32,870 OPERATION & REPAIRS 19,190 SUPPLIES & EXPENSES 73,950 CAPITAL EXPENDITURES 300,000 SUPPLIES & EXPENSES 91,339 146,823 DEBT SERVICE 1,904,201 CAPITAL EXPENDITURES 275,000 Transfers In / Out 3,087,760 TRANSFERS IN / OUT 436,497 TOTAL TOTAL 1,961,334 0200 - Internal Services PERSONNEL PAYMENTS 0 0200 - Internal Services PERSONNEL PAYMENTS TAXES & BENEFITS 25,000 - TAXES & BENEFITS 50,000 PROF & CONTRACT SERVICES 368,922 PROF & CONTRACT SERVICES 274,786 530,000 OPERATION & REPAIRS 538,610 OPERATION & REPAIRS 67,915 SUPPLIES & EXPENSES SUPPLIES & EXPENSES 63,250 CAPITAL EXPENDITURES - - CAPITAL EXPENDITURES 20,000 TRANSFERS IN / OUT 922,701 TOTAL TRANSFERS IN / OUT 29,596 DEBT SERVICE 145,193 TOTAL 1,190,571 0300 - Streets & Drainage 0300 - Streets & Drainage PERSONNEL PAYMENTS 52,852 PERSONNEL PAYMENTS 75,965 TAXES & BENEFITS 18,410 PROF & CONTRACT SERVICES 17,225 TAXES & BENEFITS 18,410 599,080 OPERATION & REPAIRS 16,700 PROF & CONTRACT SERVICES 16,800 SUPPLIES & EXPENSES 18,200 11,169 OPERATION & REPAIRS 1,313,680 CAPITAL EXPENDITURES 733,636 DEBT SERVICE SUPPLIES & EXPENSES 19,600 TOTAL CAPITAL EXPENDITURES 10,000 DEBT SERVICE 11,236 TOTAL 1,465,691 0400 - Parks & Recreation 0400 - Parks & Recreation PERSONNEL PAYMENTS 347,708 PERSONNEL PAYMENTS 455,895 TAXES & BENEFITS 92,086 TAXES & BENEFITS 126,144 PROF & CONTRACT SERVICES 156,500 PROF & CONTRACT SERVICES 148,500 OPERATION & REPAIRS 174,650 OPERATION & REPAIRS 151,000 SUPPLIES & EXPENSES 43,500 SUPPLIES & EXPENSES 47,500 CAPITAL EXPENDITURES 415,000 CAPITAL EXPENDITURES 207,000 DEBT SERVICE 217,791 DEBT SERVICE 219,109 TOTAL 1,447,235 TOTAL 1,355,148 PAGE 10

General Fund FY 2019 VS 2020 Departmental Budget 2019 2020 0500 - Law Enforcement PERSONNEL PAYMENTS 1,610,671 0500 - Law Enforcement PERSONNEL PAYMENTS TAXES & BENEFITS 711,847 1,634,600 TAXES & BENEFITS 730,262 PROF & CONTRACT SERVICES 76,700 PROF & CONTRACT SERVICES 37,500 96,350 OPERATION & REPAIRS 110,100 OPERATION & REPAIRS 207,250 SUPPLIES & EXPENSES 515,000 SUPPLIES & EXPENSES 207,000 CAPITAL EXPENDITURES 11,236 CAPITAL EXPENDITURES 2,005,000 DEBT SERVICE 3,232,198 TOTAL DEBT SERVICE 11,169 TOTAL 4,732,487 0600 - Fire Control 5,500 0600 - Fire Control 5,500 TAXES & BENEFITS 64,700 TAXES & BENEFITS 57,300 PROF & CONTRACT SERVICES 117,500 PROF & CONTRACT SERVICES 93,200 OPERATION & REPAIRS 55,700 OPERATION & REPAIRS 55,950 SUPPLIES & EXPENSES 50,000 SUPPLIES & EXPENSES 32,320 CAPITAL EXPENDITURES 117,271 CAPITAL EXPENDITURES 117,982 410,671 362,252 DEBT SERVICE DEBT SERVICE TOTAL TOTAL 1500 - Recreation Center 440,534 1500 - Recreation Center 492,716 PERSONNEL PAYMENTS 113,094 PERSONNEL PAYMENTS 117,285 64,000 TAXES & BENEFITS 159,100 TAXES & BENEFITS 87,700 PROF & CONTRACT SERVICES 64,000 PROF & CONTRACT SERVICES 155,300 25,000 OPERATION & REPAIRS 55,843 OPERATION & REPAIRS 76,100 SUPPLIES & EXPENSES 921,571 SUPPLIES & EXPENSES 47,000 CAPITAL EXPENDITURES CAPITAL EXPENDITURES 56,182 1,032,283 DEBT SERVICE DEBT SERVICE TOTAL TOTAL 1900 - Community Services 1900 - Community Services 199,565 PERSONNEL PAYMENTS 82,043 PERSONNEL PAYMENTS 193,400 38,800 TAXES & BENEFITS 4,700 TAXES & BENEFITS 81,870 PROF & CONTRACT SERVICES 11,600 - PROF & CONTRACT SERVICES 8,000 OPERATION & REPAIRS SUPPLIES & EXPENSES 336,708 OPERATION & REPAIRS 6,850 CAPITAL EXPENDITURES SUPPLIES & EXPENSES 14,222 TOTAL CAPITAL EXPENDITURES 0 TOTAL 304,342 PAGE 11

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America’s Most Livable City – City of Gulf Breeze PAGE 13