MINUTES OF THE METRO COUNCIL BUDGET & FINANCE COMMITTEE

Wednesday, May 24, 2000

Council Chamber

Members Present:  Susan McLain (Chair), Bill Atherton (Vice Chair), David Bragdon, Ed Washington

Members Absent:  Jon Kvistad, Rod Monroe, Rod Park

Chair McLain called the meeting to order at 1:39 P.M.

1.  Consideration of the Minutes of March 29 and May 10, 2000 Committee Meetings.

2.  Committee Discussion of Capital Needs Assessment and Preparation for Retreat Ordinance.

Chair McLain said Administrative Services Department (ASD) staff had been asked to provide information for the Retreat. It included additional work on the Capital Needs Assessment. Tony Mounts, ASD Financial Planning Manager, reviewed the memo and materials, Meeting Packet and attachments for inclusion in Long-Range Financial Planning FY 2001-2006. Copies of the memo and attachments are included in the public record. He noted that transfers from the Support Services fund to the General fund had increased in the last few years, both as a result of things being transferred into the General fund that had been in Support Services and a decision to allocate more costs to the Cost plan. He suggested that the Council should evaluate this policy.

Chair McLain said she felt the idea of cost allocation was a fee for Metro services that various parts of Metro used. It included cost of living adjustments (COLAs). Mr. Mounts responded that in creating a cost plan the first decision was what were direct services and what were indirect services. What was included in the shared portion of expenses had been expanded in the past few years. Previously certain functions were wholly paid out of the General fund; some additional costs had been added for recovery from the whole agency. That was a policy decision as to what costs should be recovered. Chair McLain gave an example; Information Technology (IT) where much of its services were used by the entire agency. Certain departments used it or parts of it, more than others. It was reasonable to cost it out over the entire agency. She felt that there was a lack of definition of direct and indirect costs that would provide groundwork for policy decisions.

Mr. Mounts asked if there was interest in reviewing the cost allocation plan. Chair McLain said that Metro had made a commitment to MERC to do such a review. It still needed to be done. Council needed to be sure the agency was doing a good job of spreading costs, both direct and indirect across the agency and the departments, or if some fine tuning was needed. Perhaps the size of the review should be discussed, but the Council would not be fulfilling its promises to MERC and the Zoo if it did not do so. Councilor Bragdon felt it was worthwhile. Mr. Mounts suggested a starting point might be a scope of study. Chair McLain said that a definition of direct and indirect costs should be put together immediately, then the scope of study. Councilor Atherton asked if anyone had contacted the Auditor for her insights on this subject. Chair McLain said that might be discussed at the Retreat.

Mr. Mounts noted that the Planning and Parks funds had been updated to reflect the new assumptions from the General fund. Councilor Atherton asked about the fee per acre in Parks. Mr. Mounts said it was calculated by $83/acre less any revenues from rentals on the acreage.

He said that he had found unknowns within the Metropolitan Exposition-Recreation Commission (MERC) forecast that he was trying to pin down currently. Chair McLain asked when he thought it would be ready. Mr. Mounts hoped to have it by the end of the week. Chair McLain asked about the Civic Stadium calculations. She understood that they had dates in mind for the change over, and asked if a rough figure could be calculated. Jennifer Sims, ASD Director, said it was a combination of Portland Metropolitan Exposition Center (Expo) Hall D and Oregon Convention Center (OCC) construction, and the Civic Stadium going away along with staff changes. Chair McLain suggested that at least some basic assumptions should be available for the retreat from MERC. She said that at yesterday’s Informal they had heard something about MERC assumptions for new revenues; a ballpark figure should be available. Ms. Sims assured the Chair that ASD would give Council what it had.

Mr. Mounts said that regarding the Solid Waste fund figures had just changed yesterday. Chair McLain asked where staff was in the process. John Houser, Council Analyst, said a series of amendments were being drafted for Councilor Park’s ordinance to tighten its language so that numbers would all refer to the same base, and be less confusing. This means that REM staff must rerun these scenarios today to be sure that the results were as forecast. The revised ordinance and the tax revenue figures should be available by the end of this week or early next week. Chair McLain said her understanding was that staff was looking at actual rather than estimated tonnage based on this year’s fees. Mr. Houser agreed. He said the original wording of the ordinance would have included taxing out-of-district waste brought inside the district to Metro transfer stations in the tonnage base. That would have made the tax base artificially lower than the base to which the tax was applied. He said that was just one of the issues being resolved.

Mr. Mounts noted that the Zoo page reflected the Chair’s request to note the Master Plan assumptions. He said the Support Services forecasts built on where Metro was today. Ms. Sims noted that this fund was particularly difficult to balance out because there were some areas that had funding challenges as to what the programs would require in the future. It showed no staffing adds, nor how the group would support future expansions of the Zoo and MERC. Chair McLain said that the Committee’s direction had been to look at the status quo. She felt comfortable with this. She directed attention to the list of department wants, Department Budget Add Packages, that had been solicited from departments. A copy is included in the public record. She noted it was not a full-blown list of all possible programs, but rather a limited resource list for review. Mr. Mounts said he had added columns for ongoing versus one-time funding. Chair McLain thanked both Council and ASD staff for their efforts. She asked if there were any other financial actions upcoming. Mr. Mounts noted the TSCC (Tax Supervising and Conservation Commission) Hearing June 8 with final budget action scheduled for June 15. He expected to receive any additional technical amendments from departments on June 2.

Councilor Atherton said he was working on a planning and utility fee and had been using a target figure of $2.3 million, but would like some input from staff. Ms. Sims asked what the parameters were. Councilor Atherton said he wished to formulate a clear mission of what regional planning was and how much it would cost to do it. He said that Council had a very interesting discussion yesterday on the agency’s efforts in planning and the UGB (urban growth boundary). He felt that the system was broke. He was looking at a funding source for regional planning and wanted an estimate of its cost. Mr. Mounts clarified that $2.3 was the amount of Excise tax that was transferred yearly into the Planning fund. That amount would only maintain the status quo and not an enhanced level of service. Chair McLain suggested she and Councilor Atherton should meet with Mr. Mounts to discuss this in detail. Councilor Atherton said the $2.3 million would work out to a fee of $20-25/acre. Chair McLain said her perception was not that the system was broke, but that the process had put barriers in place that were difficult to overcome. Councilor Atherton agreed. Mr. Mounts reminded the Committee that TSCC Hearing June 8 required a quorum. Chair McLain asked the clerk to notify all assistants to put this date on the Councilors’ calendars.

3.  Councilor Communications

Chair McLain adjourned the meeting at 2:15 PM.

Respectfully submitted,

Pat Weathers

Council Assistant

ATTACHMENTS TO THE PUBLIC RECORD FOR THE MEETING OF MAY 24, 2000

The following have been included as part of the official public record:

i:\minutes\2000\budget&finance/05240bdm.doc