BUDGET

BUDGET, FINANCE & INVESTMENT COMMITTEE

June 18, 2003 5:30 P.M. Courthouse

MINUTES:

Members Present: Others Present: Others Present: Others Present:

Comm. Bob Bullen Nancy Allen Wayne Harris Jennifer Farish

Comm. Anthony Johnson Comm. Joe Frank Jernigan Linda Vincion Lisa Nolen

Comm. Will Jordan Comm. Faye Elam Hooper Penuel Elaine Cawthon

Comm. Robert Peay Comm. Tina Jones Merry Hickerson

Comm. Steve Sandlin Alan Miller Mike Williams

Comm. Doug Shafer Lynn Duke Jeff Sandvig

Comm. Joyce Ealy, Chair. Bentley Shofner Tracy Hill

Ginny King Savannah Sandlin

Chairman Ealy presided and called the meeting to order with six members being present.

APPROVE MINUTES:

The minutes of the Budget Committee meetings for May 28, May 29, and June 5 were presented for approval.

Comm. Sandlin moved, seconded by Comm. Jordan to approve the minutes as presented.

The motion passed unanimously by acclamation.

GENERAL FUND BUDGET AMENDMENTS

GENERAL SESSIONS COURT:

Ms. Wanda Watkins, General Sessions Court, requested approval of the following budget transfer to provide adequate funding for the Office Supply Account for the remainder of the year:

From: 101-53300-709 – Data Processing Equipment - $150

To: 101-53300-435 – Office Supplies - $150

Comm. Bullen moved, seconded by Comm. Jordan to approve the budget transfer of $150 for the General Sessions Court as requested.

The motion passed by roll call vote, with Comm. A. Johnson being absent at that time.

JUVENILE DETENTION:

Ms. Lynn Duke, Juvenile Detention Center Director, requested approval of the following budget transfer to allocate funds from the Juvenile Accountability Incentive Block Grant to the proper account to purchase software for Juvenile Detention:

From: 101-54240-411 – Data Processing Supplies - $17,000

To: 101-54240-709 – Data Processing Equipment - $17,000

Comm. Sandlin moved, seconded by Comm. Shafer to approve the budget transfer to allocate funds for the Juvenile Accountability Incentive Block Grant to the proper account as requested.

The motion passed by roll call vote, with Comm. A. Johnson being absent at that time.

AMBULANCE SERVICE:

Ms. Ginny King, Ambulance Service, requested approval of the following budget transfer in order to be allowed to purchase a Level I computer and monitor for the Collections Clerk and a laser printer for the Emergency Room:

Budget Minutes June 18, 2003 Page Two

From: 101-55130-435 – Office Supplies - $2,745

To: 101-55130-411 – Data Processing Supplies - $ 200

101-55130-709 – Data Processing Equipment - 2,545

Comm. Sandlin moved, seconded by Comm. Jordan to approve the transfer for the Ambulance Service as requested.

The motion passed by roll call vote, with Comm. A. Johnson being absent at that time.

APPROVE CONTRACT WITH MICROVOTE TO PURCHASE VOTING MACHINES:

Mr. Hooper Penuel and Ms. Linda Vincion were present to request approval for the County Executive to execute a contract with MicroVote General Corporation to purchase 14 Infinity Voting Panels and four Precint Kits w/ADA and headphones at a total purchase price of $49,900.

Mr. Penuel advised the County Attorney and the State Department of Elections have reviewed the contract, and the voting machines have been certified by the State. The machines will be used during early voting and meet ADA regulations.

Following discussion, Comm. Shafer moved, seconded by Comm. Peay to authorize the County Executive to execute the contract with MicroVote General Corporation to purchase 14 Infinity Voting Panels and four Precint Kits w/ADA and headphones for a cost of $49,900 as requested.

The motion passed by roll call vote with Comm. A. Johnson being absent at that time.

SOLID WASTE/SANITATION FUND BUDGET AMENDMENT

CONVENIENCE CENTERS:

County Executive Nancy Allen requested approval of the following budget transfer for the Convenience Center Department to provide adequate funding for the Diesel Fuel Account for the remainder of the fiscal year:

From: 116-55732-724 – Site Development - $5,000

To: 116-55732-412 – Diesel Fuel - $5,000

Comm. Jordan moved, seconded by Comm. Shafer to approve the budget transfer for Diesel Fuel for the Convenience Center Department as requested.

The motion passed by roll call vote, with Comm. A. Johnson being absent at that time.

RESPONSE TO PUBLIC HEARING:

A synopsis of the Public Hearing that was held on June 10, 2003 was provided to the committee. The synopsis outlined the main points that were presented as: support services for the senior citizens of Rutherford County; enact impact fee (or some other form) for growth to pay for itself; fund schools; schools have enough and are building too elaborately; increase taxes; do not increase taxes.

Comm. Sandlin noted that 40 people actually spoke at the Public Hearing. He stated almost everyone talked about the services they wanted, but did not want their property taxes increased.

Comm. Shafer stated he believed the public hearing was more thought provoking than what he anticipated. He stated the responses and questions were well thought out.

Comm. Jordan stated several people mentioned the impact fee, and he believed it was something the commission needed to look at.

Budget Minutes June 18, 2003 Page Three

CONSIDERATION OF PUBLIC WORKS FUND:

The committee was provided with expenditure estimates totaling $969,534 to establish a Public Works Department.

Comm. Joe Frank Jernigan, Mr. Mike Williams, Road Superintendent; and Mr. Del Corbitt were present to discuss the request.

Mr. Corbitt advised the County Executive had requested that he and Mr. Williams review the numbers and determine what the minimum amount would be to establish a Public Works Department. The amount needed for the purchase of equipment including two dump trucks, one pickup truck, a vehicle for Storm Water Management, surveying equipment, one gradall, one backhoe, and one trailer was estimated to be $515,000.

Mr. Corbitt advised Mr. Williams had reviewed his estimates and reported if the equipment was purchased, there would be a need for personnel to operate the equipment. Personnel requested were an engineer in training, one foreman, one equipment operator, two truck drivers, one legal secretary and one clerical personnel, as well as overtime. The salary and benefits totaled $293,714.

Comm. Peay stated as a rural commissioner, the calls that bother him most are those dealing with flooding issues. He stated most of them are dealing with needing a ditch cleaned that might be just off the right-of-way.

Mr. Corbitt advised they have developed a victim’s list that consists of about 80 projects. He stated it consists of projects that range from fairly minor projects to some complex problems. He stated it does not include the Greenwood or Twin Oaks problems. He advised the City of Murfreesboro required the homeowners to cut the grass inside their easements. If the homeowner does not keep it clean and the City has to clean the easement, they bill the homeowner. He explained the idea behind this Public Works Department would allow the Highway Department to get off of the right-of-way and clean up some of the problems.

Mr. Corbitt advised, because of the federal mandate for storm water management, Rutherford County would be required to maintain the guidelines within three years. He said the county would eventually have to set up a detect and correct system to handle the quality problems. He stated this program would initially handle the quantity problems. The initial quality type problems would be handled through public education.

Comm. Peay stated he did not want to spend the money to do this, however he stated he believed the county needed to, at least, start a program. He stated it was an unfunded mandate and the County would have to do something within three years. He stated he believed the County should do something to get the program initiated even if it was on a small scale.

Comm. Jernigan advised the ditches have not been maintained. He stated when this project is started, it will have to be a little at a time with what the county can afford. He stated the time has come that the County is going to have to start doing something about the drainage problems. He stated right now there is no mechanism to do anything regarding the drainage issues. He stated citizens are paying taxes, and they do not understand why the county cannot help with the drainage problems.

Comm. Jernigan stated the cost of the equipment is about one-half the cost, but it would probably last about 15 years. He also stated that even though a foreman is requested, the foreman at the Highway Department actually works. He would be capable to perform any of the work.

Comm. Peay recommended the equipment could be purchased from the Development Tax. He asked with the personnel recommended, would it be possible to accomplish much work.

Comm. Jernigan and Mr. Williams stated they believed a lot could be accomplished with what was being recommended.

Budget Minutes June 18, 2003 Page Four

Comm. Sandlin stated the people in his area have to live with this on a day-to-day basis. He stated they cannot use their drainage system at all until the water goes away. He stated there are approximately 15 houses in one sudivision with drainage problems. He stated this is not a matter of “wants”, but these are needs. He stated the people are trapped. He stated he believed it would be a step forward.

Comm. Jernigan stated he believed the estimate was the bare minimum that should be considered. He stated if this was not funded, the program should not be started.

Mr. Williams advised the cost of the equipment was $515,000 and the total for the personnel and supplies was $454,534. He stated there was no use in purchasing the equipment if the people were not going to be hired.

Following discussion, Comm. Bullen moved, seconded by Comm. Peay to fund $515,000 from the Development Tax for the equipment and to fund the remaining $454,534 for the personnel and supplies with 1.5 cents increase in the property tax rate.

Comm. A. Johnson asked if there was enough money in the Development Tax to fund the $515,000.

Ms. Nolen advised they would be dipping into the fund balance. Ms. Nolen advised there is not a fund balance policy setting a limit of the fund balance in the Development Tax, but with estimated revenues of $3.8 million and estimated expenditures of $4.3 million and an estimated ending fund balance of $2.9 million, this would make the ending fund balance of $2.4 million.

Comm. Jordan stated if the 1.5 cent property tax increase did not pass at the commission meeting, he did not want to have to purchase the equipment if the property tax increase was not approved. He stated he would like the motion to be contingent upon the personnel being funded with the tax increase.

Comm. Bullen changed the motion to fund $515,000 from the Development Tax for the equipment and to fund the remaining $454,534 for the personnel and supplies with a 1.5 cent property tax increase contingent upon the 1.5 cent property tax increase being approved by the full commission.

Comm. Peay agreed to second the revised motion.

Comm. Shafer asked how much money was available for storm water management now?

The County Executive and Ms. Nolen advised this would be a totally new fund, and there was no money available. The County Executive explained, if this was ultimately approved, there was some money being appropriated in the Engineering line item in the Miscellaneous Category of the General Fund regarding Storm Water.

Mr. Corbitt advised the mandated storm water management is for quality problems, and what is being proposed now is for quantity type problems.

Comm. A. Johnson stated most people think there should be an impact fee. He suggested a special assessment district be studied, so that the people in the rural areas would pay for the service and the citizens in the city would not be double taxed.

County Executive Allen advised she had met with CTAS to research some of the mechanisms that the County could take advantage of in funding some of the federal mandates regarding storm water management and perhaps creating a drainage district.

Mr. Corbitt advised the Storm Water Advisory Committee would have to present to the County Commission a proposed Storm Water Ordinance. He stated a part of that ordinance would address funding as part of the regulations.

Mr. Corbitt advised if the Public Works Fund was approved by the Commission, Mr. Williams would not be able to order any equipment until after July 1 after RFP’s were requested. He stated that would take four to six months. He stated personnel would not be hired until the equipment was acquired. He explained there would probably only be about six to seven months of field time next year.

Budget Minutes June 18, 2003 Page Five

Chairman Ealy advised this would be establishing a new fund, and even if the motion passed and was approved by the commission, there would be no dollars available in the fund and would not be until some property tax collections are received, which would not be until October.

Mr. Corbitt stated if the equipment could not be ordered until there was money available, that would throw everything off until next spring, and basically would be putting the program off for another year. The equipment could be ordered from the Development Tax, but the people could not be hired until there were funds available.

Comm. A. Johnson stated if it is possible to establish a storm water district, he did not see establishing a new department and funding the money if it was possible to fund it some other way. He stated it just would not be funded this year.

Following discussion, the motion to approve the Public Works Fund for 2003-04 totaling $969,534 with $515,000 being funded from the Development Tax for equipment and the remaining $454,534 for personnel and supplies being funded with a 1.5 cent increase in the property tax rate passed by roll call vote with Comm. A. Johnson voting “no”.

RECOMMENDATION TO PARTICIPATE IN FUNDING FOR FLORENCE ROAD IMPROVEMENTS:

Mr. Dana Richardson, City of Murfreesboro Planning Department, addressed the committee regarding the county participating with the City of Murfreesboro for Florence Road reconstruction from Manson Pike to Northwest Broad Street. The City of Murfreesboro’s portion would be 52% or $2,110,835, and the county’s share would be 47% for a total of $1,889,985. The total project cost would be $4,040,850.

Mr. Richardson advised there would be about three miles of roadway that would be reconstructed. He advised they are proposing to spread the funding needs over three budget cycles, with $160,000 for the right-of-way acquisition needed in late spring of 2004, which could be included in the bond issue that is anticipated at that time. The remaining $1,600,000 would be split, with $800,000 being funded in 2004-05 and $800,000 being funded in 2005-06.

A discussion was held regarding the signalization. Mr. Richardson advised the signalization was relatively cheap, he advised the road improvements that go with it is the bulk of the cost.

Mr. Richardson advised the costs are planning estimates based on preliminary engineering and are consistent with like projects that have been done. The City of Murfreesboro would be paying the entire engineering cost.

Comm. A. Johnson asked about the realignment cost and the cost of reconstruction. Mr. Richardson advised the realignment cost would be substantial. Comm. A. Johnson asked about the realignment cost at the intersection, itself. He stated he believed the project should be broken down in steps, as far as what the county might fund, and what it might not fund. He stated he believed the signalization was needed desperately. He stated he believed the county should participate in the signalization cost and part of the realignment cost, but not the entire project.

Following discussion, Comm. A. Johnson made the motion to deny the proposal.

The motion died for the lack of a second.

Comm. Jordan moved, seconded by Comm. Sandlin to forward the issue of participating in the Florence Road Improvement Project with the City of Murfreesboro to the full commission with no recommendation.

Comm. A. Johnson stated he did not believe it should be sent to the commission without a recommendation. He stated if the commission approved the project, it would still have to come back to the Budget Committee for funding.

Budget Minutes June 18, 2003 Page Six

Comm. Sandlin stated he did not believe he could vote for the entire package. He stated with the budget constraints and other necessities, he would agree with Comm. A. Johnson to help fund the signalization and helping on the first phase. He stated he definitely did not want to send it to the full commission without a funding mechanism.

Following discussion, Comm. Jordan withdrew his motion, and Comm. Sandlin agreed to withdraw the second to the motion.

County Executive Allen explained when the three schools were being discussed in Blackman, it was specifically discussed about Blackman Road, Brinkley Road, and Florence Road all being improved as a result of the three schools, the amount of development that would be taking place and buses traveling in that area. She advised the county is participating with the City on Manson Pike, and she believed Florence Road was an important part of that plan and needs to be improved.

Following discussion, Comm. Bullen moved, seconded by Comm. A. Johnson to approve the proposal as presented to participate in the Florence Road improvements with the City funding 52% of the project for a total of $2,110,835 and the county funding 47% for a total of $1,889,985 with the total cost of the project being $4,040,850, and that the county’s funding be provided through a future bond issue.

Comm. Peay stated there was an intergovernmental agreement with the cities relative to the sales tax. He stated that the City of Murfreesboro is requesting from the county the portion of revenue they are losing from State funding in the approximate amount of $515,000.

Comm. Peay moved to amend the motion, seconded by Comm. A. Johnson that any monies taken from the County relative to the sales tax Intergovernmental Agreement by any of the municipalities be subtracted from the county’s funding for the Florence Road Improvement project contingent upon approval by the County Attorney.

Mr. Richardson stated he would report to the Mayor and the City Council about the issue of deducting the $515,000 that the city has requested back from the sales tax, but he stated he could almost guarantee that if the City of La Vergne requests their money back and that is deducted from the project also, then ultimately the City of Murfreesboro would have to pay for it. He stated the City would not agree to that.

Following discussion, Comm. Peay revised the amendment to state only the City of Murfreesboro’s portion of the sales tax would be deducted from the Florence Road project.

Following discussion, the amendment to the motion to deduct the $515,000 that the City of Murfreesboro has requested back from the Sales Tax Intergovernmental Agreement due to the loss in State-Shared revenue from the Florence Road Project failed by roll call vote with Commissioners Peay, Sandlin, and Shafer voting “yes”; and Commissioners Bullen, A. Johnson, Jordan and Ealy voting “no”.

The original motion to approve the Florence Road Improvement Project with the City funding 52% and the County funding 47% to be funded through a future bond issue passed by roll call vote with Commissioners Bullen, Jordan, Sandlin and Ealy voting “yes”; and Commissioners A. Johnson, Peay, and Shafer voting “no”.

PROPOSAL FROM MTSU BUSINESS AND ECONOMIC RESEARCH CENTER TO STUDY IMPACT OF CONTINUING GROWTH ON REVENUES AND SERVICES:

Comm. Faye Elam and Dr. David Penn, MTSU Business and Economic Research Center, addressed the committee regarding a proposal to research the impact of continuing growth on revenues and services.

Comm. Elam stated she had read Comm. Bullen’s comments in the Budget Committee minutes to request the next Budget Committee study alternative sources of revenue. She stated in the Steering Committee, Comm. Jones had challenged the committee members to make some suggestions for the budget. She explained she had looked at some other states and counties, but decided to place her focus on Rutherford County. She stated after realizing that Destination Rutherford was fully funded and they are ready to start recruiting new industry, she began thinking about how that would impact the county and our revenue sources.

Budget Minutes June 18, 2003 Page Seven

Comm. Elam reported she met with Steve Benefield, Chamber of Commerce, with the idea of forming a committee to look at the county’s revenue. She stated Mr. Benefield directed her to Dr. Penn at MTSU, because the university provided the Destination Rutherford study and in reviewing it there is a lot of information pertaining to the county’s revenue and property taxes. She stated Mr. Benefield believed it was important that both studies work together.

Comm. Elam advised she met with Dr. Penn, and he has drafted a proposal.

Dr. Penn advised that MTSU has been contracted to do a follow-up study for Destination Rutherford to follow up on some of the problems that were mentioned two years ago, particularly on how to get average wages back on a growth path for the next 5 to 20 years.

Dr. Penn presented an outline of a proposal to look at the long-term growth paths for revenue based on demographic trends, employment trends, income trends and their affect on local county revenue, and to also look at the major sources of revenue. He stated the proposal will also address the demand for services and other indexes and demands for services. He stated a comparison would be made between the baseline revenue growth with the baseline demand for services.

Dr. Penn also advised they would examine the sensitivity of the baseline case to alternative growth scenarios such as higher wage rates, smaller size of new houses, new availability of local high-end retailing, and other scenarios.

The BERC will provide a completed report to the County by November 21, 2003 for a fixed-price of $18,000.

Comm. Elam stated with the statistics that the study could provide, it would give the County good information to make better decisions about what needs to be done regarding revenue.

Comm. Peay stated he believed it was a good idea.

Comm. Elam stated she had asked Dr. Penn to study all of the current revenue sources, as well as a true impact tax. She stated she did not believe most people understood, that a true impact tax is very difficult to collect and most places have to hire someone to oversee it because it is constantly changing.

Comm. Shafer questioned the $18,000 fee.

Comm. Elam stated she had suggested that funding be requested from the Industrial Development Board or that it could possibly be a Destination Rutherford project. She stated she believed the study that was done for Destination Rutherford was about $25,000 to $30,000.

Comm. Elam stated she believed it would be a good tool for planning and zoning, and good information for realtors and developers and Destination Rutherford.

Following discussion, Comm. Peay moved, seconded by Comm. Sandlin to authorize the County Executive to execute the contract with the MTSU, Business and Economic Research Center to conduct a study relative to the Impact of Continuing Growth on Revenues and Services contingent upon the Industrial Development Board or Destination Rutherford providing the funding for the $18,000 fee.

The motion passed unanimously by roll call vote.

ADVERTISING RATES FOR RUTHERFORD THE TENNESSEAN:

The committee was provided with information regarding advertising rates and deadlines for placing Rutherford County public notice advertising in the Tennessean (in the Rutherford zone).

Budget Minutes June 18, 2003 Page Eight

2003-04 BUDGET REVIEW

GENERAL FUND:

The committee was advised that due to several grant awards approved by the County Commission on June 5, it was necessary to add the revenue to be received from the grants to the 2003-04 budget. The Emergency Management Department has advised revenue from the Domestic Preparedness Grant needed to be carried forward in the amount of $5,260; Byrne Grant for the Drug Court - $75,000; Byrne Grant for Fingerprint System - $31,500; JAIBG Revenue - $2,450, additional TEMA Grant funds - $8,459; and a contribution from the City of Murfreesboro for the Drug Court - $25,000. Total estimated revenue for the General Fund is $50,046,715 with a 10 cent property tax increase.

Adjustments to the General Fund expenditures were as follows: reduction of Traffic Control Category - $2,000; eliminate NACO Dues - $2,340. Additions to expenditures: JAIBG Grant for the DA totaling $7,193; JAIBG Grant for Youth Services - $7,410; Domestic Preparedness Grant - $5,260; Facility Use Fee for Center for Forensic Medicine - $7,000; Regional Transportation Dues - $6,850.

The committee was provided with several options regarding the General Fund. The first option reflected a 10-cent property tax increase with no raises for employees. With this option the revenue exceeded the expenditures by $127,670. This option produced an estimated fund balance on 6/30/04 of $10,889,852 with a 22% fund balance.

The second option reflected the effect of a 10 cent property tax rate increase for the General Fund with employees receiving a 1-step increase, in which the expenditures would exceed the revenue by $625,322. The General Fund estimated ending fund balance on 6/30/04 would be $10,136,860, which would be 20% of the recommended appropriations.

Another option reflected a 7-cent property tax increase with a 1-step salary increase for employees. The expenditures would exceed the revenue by $1,573,637. The estimated fund balance on 7/1/04 would be $9,188,545, which would allow for an 18% ending fund balance.

The fourth option reflected a five-cent property tax increase with no salary increases for county employees. The expenditures would exceed the revenue by $1,452,855 and would achieve an estimated ending fund balance on 6/30/04 of $9,309,317 or 19%.

A chart was provided to the committee showing the effect of potential salary increases. To double longevity from $25 to $50 with no salary increase would cost approximately $121,862, a 1% salary increase with $50 for longevity would cost $400,426, a 1.5% salary increase with $50 for longevity would cost $523,505, a 2% salary increase with $25 for longevity would cost $525,157 and a 1-step increase, with 2% after step 15 and $25 for longevity would cost $752,992.

Information was provided to the committee regarding some potential budget reductions for the Sheriff’s Department. The recommended reduction for the Sheriff’s Department was $119,000 with Account 54110-196, In-Service Training being reduced by $15,000; Account 336 being reduced by $9,000; Account 425 being reduced by $50,000; Account 451 being reduced by $25,000 and Account 708 being reduced by $20,000. The recommended reduction for the Special Patrols was $24,366. The recommended reduction for the Jail was $171,000, with Account 340 being reduced by $100,000, Account 452 being reduced by $50,000 and Account 707 being reduced by $21,000. The total potential budget reductions for the three categories of the Sheriff’s Department were $314,366.

Finance Director Lisa Nolen provided the actual amounts spent in the Sheriff’s line items to-date.

Chairman Ealy advised she had talked with Chief Deputy Nelson about the proposed recommended reductions. She stated that Chief Deputy Nelson believed they had submitted a good budget, and that the budget was presented to the Public Safety Committee and the Budget Committee.

Comm. A. Johnson advised he had asked several commissioners if they had any suggestions regarding the budget. He reported Comm. Paul Johnson had submitted these recommended reductions for the Sheriff’s Department.

Budget Minutes June 18, 2003 Page Nine

County Executive Allen stated the committee would need to decide if the proposed 10 cent increase for the General Fund was going to stay in. If the 10 cents does not remain, the committee needs to give some direction, so she can advise the Department Heads whether they need to make additional cuts or to cut personnel. She explained, that not including salary and benefits, the budget reflects on average a 4% cut from last year. She stated if the committee decides to fund less than 10 cents on the property tax rate, it would potentially mean cuts in personnel.

Comm. Sandlin stated if the property tax rate is cut on the commission floor, it would need to be determined where the cuts are coming from.

Chairman Ealy reminded the committee that in the beginning it was decided they wanted to balance the General Fund and to protect positions and services.

Comm. Sandlin stated it was a slap in the face for employees to have an increase to their health insurance in January with no salary increase.

The committee discussed using the ending fund balance. Comm. Bullen stated he believed the County should get over the hump this year and not use the ending fund balance. He stated if there is a year to try to fix something, this is the year to do it.

Comm. A. Johnson stated he agreed with saving services and positions. However, he stated it should not be done at all cost. If something is expendable, it should be found. He stated there were probably some positions that were not needed, he stated he did not know where they were. He said some of the services are good to have, but they are not all necessities.

Comm. Peay stated he did not agree with everything that is in the budget. He stated each commissioner has their own preference; however, it is the committee’s job to present the best recommendation they can. He stated he believed the committee should come up with a consensus.

Comm. Jordan moved, seconded by Comm. Shafer to eliminate ½ cent from the General Fund property tax increase for a total increase of 9.5 cents, with no salary increases for employees, and to approve the revisions to the revenue for the various grants and the revisions to the expenditures as stated.

Ms. Elaine Cawthon advised that additional revenue of $31,500 was added to the revenue for the grant for the Sheriff’s Department fingerprint system. She explained she was advised late in the afternoon by Sheriff’s Department personnel that the expenditure for the fingerprint system was not in the budget. The total cost for the system is $42,000.

This would cause the General Fund budget to be out of balance by approximately $70,000.

Comm. Joe Frank Jernigan stated if the committee was considering a 9.5-cent increase in the property tax rate and no salary increases, he believed in talking with other commissioners that they expect some kind of raise for county employees.

Following discussion, Comm. Jordan withdrew his motion, and Comm. Shafer withdrew his second.

The Finance Director stated one possibility for utilizing fund balance, would be to have a plan to perhaps state that the money turned back into fund balance could only be used for capital expenses.

Following discussion, Comm. Bullen moved, seconded by Comm. Jordan to approve a 10-cent increase in the property tax rate for the General Fund for a total property tax rate for the General Fund of 63 cents with no employee raises.

Comm. Sandlin stated he would like to designate any excess funds be earmarked for storm water management.

The Finance Director stated she would not want to see it used for recurring expenses.

Budget Minutes June 18, 2003 Page Ten

After further discussion, the motion to approve a 10-cent property tax increase for the General Fund for a total property tax rate for the General Fund of 63 cents with no employee raises passed unanimously by roll call vote.

Chairman Ealy noted a copy of a letter from the City of La Vergne requesting funding for school crossing guards was being provided to the committee.

County Executive Allen advised the funding is already included in the budget.

Chairman Ealy also noted a copy of the letter from the City of Murfreesboro was being provided as formal notification that the City of Murfreesboro is exercising its option to recover lost state-shared revenue as set forth in Section 7 of the Intergovernmental Agreement for the Allocation of a Portion of any Additional County Sales Tax Levy.

A summary of State-Shared revenue was provided to the committee.

COMMISSION/COMMITTEE COMPENSATION:

Chairman Ealy advised, via a letter from County Attorney Jim Cope, that the committee would need to approve a resolution to reduce County Commissioners’ compensation for attendance at the legislative bodies and authorized committee meetings.

Comm. A. Johnson stated he did not believe it was right that they should have to vote on a raise for themselves. He stated it has been presented that everyone is cut. He stated that is not exactly right. He stated commissioners are the only ones that are being cut. He stated it was not fair that commissioners’ pay is being cut. He stated if the commissioner’s pay was being increased, he would be the first one to say it should not be increased; however, he stated it was not right to decrease the commissioner’s pay.

Comm. A. Johnson moved, seconded by Comm. Sandlin not to decrease the Commissioners’ pay.

The committee was reminded that the County Attorney had requested if the Constitutional Officers’ received their pay increase, that he would like to receive the pay increase also. The County Attorney typically receives the same percentage increase as the Constitutional Officers.

Comm. A. Johnson stated the County Attorney is not a constitutional officer. The committee agreed to leave the salary without an increase.

Following discussion, the motion not to decrease commissioners’ pay passed by roll call vote with Commissioners Bullen, A. Johnson, Jordan, Sandlin and Ealy voting “yes”, and Commissioners Peay and Shafer voting “no”.

2003-04 SOLID WASTE/SANITATION FUND:

The Solid Waste/Sanitation Fund is currently balanced. A list of changes was presented showing the effect of a 1-step increase for the Solid Waste employees. The total expenditures would be $2,665,403; however since the one-step was not approved, the only change would be to reduce Account 116-55732-402, Asphalt by $4,000 and increase Account 116-55732-187, Overtime Pay by $4,000 and the related benefits. The Solid Waste/Sanitation Fund would still be in balance with estimated revenue of $2,900,619.

Following discussion, Comm. Peay moved, seconded by Comm. Jordan to approve the Solid Waste/Sanitation Fund 2003-04 budget as amended reducing Account 55732-402, Asphalt, by $4,000 and increasing Account 55732-187, Overtime Pay, by $4,000 with the related benefits. The estimated revenue for the Solid Waste/Sanitation Fund total $2,900,619, and the estimated expenditures total $2,635,409 plus the related benefits on the $4,000 for Overtime Pay.

The motion passed unanimously by roll call vote.

Budget Minutes June 18, 2003 Page Eleven

2003-04 ROAD & BRIDGE FUND BUDGET:

Chairman Ealy reminded the committee at the last meeting, the committee voted to remove the 1-step pay increases for the Highway Department employees, the same as other county employees.

Mr. Williams advised even though the 2003-04 budget is approximately $700,000 out of balance, he typically turns back in a substantial amount enabling him to build his own facility from savings. He estimated he would be turning back about $250,000 to $300,000 into the ending fund balance this year. He stated he did not spend money if he did not need it.

Comm. Bullen asked Mr. Williams if he was giving salary increases? Mr. Williams replied that he was planning to give raises, and he stated he believed all county employees should receive raises.

Comm. Bullen noted that in the letter provided by Mr. Cope, that the County Commission cannot control the line item expenditures. Within the major categories, the County Highway Commission can direct how the funds are expended. He stated if the commission is trying to keep the Highway Superintendent from giving raises, it would appear the major fund could be reduced by the amount of the raises, making it difficult for the Highway Department Superintendent to give raises.

Mr. Williams advised the cost for the raises for his department, along with longevity amounted to $56,454. He stated he was willing for the committee to cut any account.

Comm. Bullen asked Mr. Williams if he would still give raises to his employees? Mr. Williams replied that he would still give the raises for his employees.

Comm. Peay asked Mr. Williams if all of the revenue he received was State revenue? Mr. Williams advised he received no property tax money. He stated he did receive Wheel Tax, Sales Tax and Mineral Severance Tax.

Comm. Peay asked if anything was being done as far as asking Department Heads to look within their budgets to see if they can find any money to give raises to employees.

County Executive Allen advised a memo had been sent out. She advised most of the departments responded but only about $98,000 was found.

Following discussion, Comm. Peay moved, that the Highway Department 2003-04 budget be amended to allow Mr. Williams to give his employees’ raises.

Comm. A. Johnson stated if the Budget Committee agreed with the motion that would be totally wrong, because the committee would be saying they agreed with the Highway Department employees receiving raises and not other employees.

Following discussion, Comm. Peay withdrew his motion.

Comm. Peay moved, to accept the Highway Department’s 2003-04 expenditures as originally presented.

The motion died for the lack of a second.

Comm. Sandlin moved, seconded by Comm. Bullen to approve the 2003-04 Highway Department expenditures as originally presented totaling $7,282,168.

Comm. Bullen asked if this would be giving up State money?

Comm. Bullen withdrew his second to the motion.

Mr. Williams stated he believed the Budget Committee could approve the budget, but also state within the motion that they do not agree with the Highway Department employees receiving raises.

Budget Minutes June 18, 2003 Page Twelve

Comm. A. Johnson moved, seconded by Comm. Shafer to reduce the Highway Department expenditures by $56,454 and to approve the 2003-04 Highway Department budget totaling $7,225,714.

Finance Director Lisa Nolen stated the Highway Department budget would still be approved out of balance.

Mr. Williams advised by the end of the fiscal year, the Highway Department would be in balance.

Following discussion, the motion to approve the 2003-04 Highway Department budget with revenue totaling $6,447,910 and expenditures totaling $7,225,714 passed unanimously by roll call vote.

Comm. Shafer stated he would like to have County Attorney Jim Cope explain the letter regarding the Highway Department, especially Section 1 and Section 11 as it pertains directly to this situation. Mr. Shafer stated it appeared the compensation was in the Administration Category.

It was explained that the salaries for Highway Department employees are scattered throughout the Highway Department budget and are not all in one category.

2003-04 ECONOMIC DEVELOPMENT FUND:

Finance Director Nolen advised the total revenue for the 2003-04 Industrial Economic Development Fund totals $131,880; however Account 119-58700-309, Contracts with Government Agencies can be reduced to $17,030, as the Town of Smyrna has agreed to waive their share of the Destination Rutherford for the remaining three years. The total expenditures are $220,130.

Comm. Sandlin moved, seconded by Comm. Jordan to approve the 2003-04 Industrial Economic Development Fund with revenue totaling $131,880 and expenditures totaling $220,130.

The motion passed unanimously by roll call vote.

2003-04 LOCAL PURPOSE TAX FUND:

The revenue for the 2003-04 Local Purpose Tax Fund totals $3,815,000, and the proposed expenditures are $4,343,475.

Ms. Nolen advised with the recommended appropriation of $515,000 for the equipment for the Public Works Department, the total expenditures now total $4,858,475.

Comm. Sandlin moved, seconded by Comm. Peay to approve the 2003-04 Local Purpose Tax Fund with estimated revenue of $3,815,000 and proposed expenditures of $4,858,475.

The motion passed unanimously by roll call vote.

2003-04 DRUG CONTROL FUND:

Finance Director Nolen advised the Sheriff’s Department has requested to revise the revenue for the Drug Control Fund changing Proceeds from Confiscated Property from $250,000 to $300,000 and adding $5,000 for Contracted Services for total revenue of $617,000.

Since the 1-step increase for county employees has not been approved, the proposed expenditures for the Drug Control Fund will remain the same at $625,314.

Comm. Peay moved, seconded by Comm. Shafer to approve the 2003-04 Drug Control Fund with estimated revenue totaling $617,000 and proposed expenditures of $625,314.

The motion passed unanimously by roll call vote.

Budget Minutes June 18, 2003 Page Thirteen

ADJOURNMENT:

There being no further business to be presented at this time, Chairman Ealy declared the meeting adjourned at 10:05 P.M.

The Budget Committee will meet again on Thursday, June 19, 2003 at 5:30 P.M.

_____________________________________

Elaine Cawthon, Secretary

Back To Agenda