Of the Olatha City Council to order for Tuesday, August 27th, 2024.

We do have Matt Schoonover, one of our council members that has joined us virtually.

You can see him on the screen.

Hi, Matt.

You can hear?

Yeah, there he is.

Hello, everyone.

A very specific purpose tonight, and that is to uh conduct a public hearing for two items, and that is for our first fiscal year 2025 budget and also exceeding the revenue neutral rate.

So without any further ado, I'll open the public hearing pursuant to KSA 79-2929 and KSA 79-2988 to hear comments regarding the proposed city belate the fiscal year 2025 budget and exceeding the revenue neutral rate.

Is staff here to present as part of this public hearing?

Yes.

All right, good evening, Mayor and Council Catherine Messer, budget analyst.

Um tonight, like Mayor mentioned, is our public hearings on both the 2025 proposed budget and the revenue neutral rate.

On the agenda tonight, we'll briefly cover the budget process, the CIP, and total budget before opening the public hearings.

So as you know, the budget process is a culmination of work that began all the way back in February.

Internal budget planning includes a collection of forecasting, drafting, taking department input planning, and ultimately summarizing it into a proposed budget.

We then bring the budget to the council through individual budget workshops where we work our way through each fund.

So in workshop one, we covered our property tax supported funds, the general fund library debt service fund.

We then follow that up in workshop two with the water and sewer fund, and the remainder of the funds were covered in workshop three that includes stormwater, solid waste, recreation, and the park and street maintenance sales tax funds.

Which brings us to tonight for the budget and revenue neutral rate uh public hearing.

After tonight's public hearing, council will be asked to consider adoption of the final budget at the regular meeting scheduled for September 3rd.

So, as previously mentioned, tonight is the public hearing for the budget, but also exceeding the revenue neutral rate.

As a reminder, the truth in taxation was passed in 2021 by state legislature, and this legislation creates a requirement for jurisdictions to present a budget that does not collect even one more dollar property tax revenue than the previous budget year without establishing notice and holding a public hearing.

So, what does that mean, right?

So not being able to exceed the revenue neutral rate would mean that the city would not be able to collect any additional property tax revenue than the previous year, even taking into considerations like increases in population, new construction, or increases in appraised value of properties.

The revenue neutral rate does not take into account the cost of services going up on the city due to inflation and a growing population, which is why most cities must exceed the revenue neutral rate.

So on July 16th, council voted on the intent to exceed the revenue neutral rate with the direction to staff to publish the current mill rate of 23.356.

As a reminder, the city only has the authority to set the city's property tax levy, which makes up 20% of a resident's property tax bill.

As you can see on the chart to the right, the other taxing jurisdictions receiving property tax from Olatha residents include the school district, Johnson County Community College, Johnson County, and the Johnson County Parks and Recreation.

So now shifting into a bit of the numbers behind the 2025 proposed budget.

Starting off with our biggest fund, the general fund, the 2025 proposed general fund budget is 194 million, with 151 million following into the operating budget and 42.9 in reserves.

Breaking down general fund a little bit more here, revenues from 2025 are generated mostly by sales tax dollars, which make up 52% of revenues, total revenues.

The next largest revenue category in the general fund is property tax, which makes up 19, followed by franchise at 9, charges for services at 7%, and then other revenues at 7%, and then transfers, interfund transfers there.

The right side of this screen showing the expenditure breakdown for the general fund, 68% of total expenditures pay for our people, 19 or 18 percent is allocated for contractual services like consultants and utilities, um, six percent for commodities, and that final eight percent is allocated for interfund transfers, which are transfer sick capital projects.

So moving to an overview of the utility funds in the proposed 2025 budget.

Water and sewer has a 2025 proposed budget of 93 million, um, 8.2 for stormwater, and 24.1 for solid waste.

The 2025 proposed monthly utility rates, water and sewer includes a 9.8% change, while stormwater at three and solid waste at 5% for an average monthly change of $10.09 cents.

This budget also includes the 2025 to 2029 proposed capital improvement plan.

Some of the CIP highlights include 22 million in funding for stormwater projects, focus on flood control and asset management, a significant focus on our transportation network, including 56 million for 119th, 110 million for our street preservation, and 40 million for Santa Fe improvements.

New projects and city buildings are included in the CIP, such as Fire Station 9 and 119th Street, and then additional funding for the city water and sewer network.

So the total funding of the CIP is just over a billion, is made up of debt funding, utility funding, federal state grants, cash, and other sources.

So as you've seen this summer, this budget includes some budget additions.

The 2025 proposed budget includes the addition of 32 FTEs across five funds.

So all in all, this budget is consistent with the budget principles, 2040 strategic plan and fiscal policies.

This budget fund uh 70% of the 2025 proposed general fund budget is dedicated to public safety and infrastructure.

Funding over 1 billion in capital projects in planning for growth and development in South Olatha, and continues the investment in economic development and rebate programs with an expansion to veterans.

So the total 2025 proposed budget is 611 million, a six and a half increase from 2024.

Um and this includes both operating and cash reserves for all city funds.

Staff and I are happy to answer any questions.

If none, I will turn it back over to you, Mayor, um, to open the public hearings.

Thank you.

Uh any questions of staff at this time?

Okay.

Thank you.

Thank you.

Um we have three individuals that have signed up to speak in this public hearing.

Um City Clerk, would you like to uh invite them up to the mic, please?

Our first speaker is Jean Senessex.

Welcome.

Thank you.