Travis County Commissioners Court
August 31, 2004
Item 15.d
Prior to lunch, we were working or walking our way through number 15. We
had gotten to d. Redirection of existing resources within transportation and
natural resources.
>> you did send us a memo. Give us your one minute version
of a summary of the highlights, please.
>> all right. We gave -- we laid [indiscernible] options
out for redirecting resources. Part of the issue is the resources we're talking
about are highway fines and fees, that go directly into the road and bridge
fund. So we tried to devise a path that -- that basically made the least amount
of work for everybody to account for how the funds were being used. The easiest
option is option number 1. It nets the general fund $1.1 million, basically
it takes what is currently an allocated reserve in the general fund and moves
it to the unallocated reserve. The general fund currently, by policy you keep
11% in reserve, of emergency [indiscernible] all the funds. The general fund
carry that's burden for all of the rest of the funds, including road and bridge.
What we are suggesting here is by moving what we currently have in rod and
bridges -- road and bridges allocated, moving it into unallocated, we are
picking up some of that 11% reserve, but in the road and bridge fund. When
we do that and freeze up a like amount in the general fund for use for whatever
purpose, so -- so that's the strategy that we are taking on all three options.
The next level up basically nets about 1.9 meteorologist -- 1.9 million bucks,
but in that process we move off the road and bridge fund. The capital cost
f mix. F mix used to be pa floyd out of certificates -- used to be paid for
out of certificates of obligation. But we pay for that out of current resources
by moving it back on to certificates of obligation, it begin frees up an amount
of money question put in unallocated reserve that again picks up some of the
11% reserve. The third option would add to that remove the hot mix overlay,
also to certificates of obligation. So you have hot mix and the f mix being
paid for out of co's, the road and bridge fund then picks up a larger percentage
of the reserve and frees up the entire $3.7 million to the general fund. The
down side of that you are increasing, at least in option 2 and 3, increasing
your debt amount in c.o.s. Although there is -- this was the way we used to
pay for hot mix overlay and f mix in the past. So basically moving it back
to that method of financing. Short of that, if you want to achieve the same
results, anything over 1.1 million, you are going to have to start taking
it out of operating line items in the road and bridge fund. Being either reducing
programs, putting that amount into unallocated reserve, and freeing up the
general fund again. You can do that up to a point. I suggest you might be
able to do that even for a year or two before you are really faced with programmatic
cuts. What we have, quite frankly, we can cover short-term revenue to the
general fund, it's the permanent long-term cuts that are more problematic.
By fy 2007, you will have used up any -- any savings you might have had in
the road and bridge fund. And that -- at that point you are absolutely faced
with the decision of cutting back on road and bridge maintenance in order
to accomplish the permanent savings. So a lot of it boils down to what you
want to accomplish. Temporary moves or permanent moves. Whether you want to
do programmatic cutbacks or whether you want to defer those decisions on a
programmatic cuts or future -- future fiscal year.
>> let me ask if there's something else in between. Christian
I may need a budget type person up here to answer this question. The option
1 related to removing, replacing the moneys out from the road and bridge fund
to the unallocated reserve, is that considered one-time money.
>> yes.
>> that's part of the problem here is that what we have considered
and are having in play here is what we thought was the equivalent to ongoing
money in terms of the penny that's not really the penny, that we have to swap
out with the -- with the fines and fees money, but one time money doesn't
get us to where we need to be with the list of things that we've got on here,
maybe the hospital district that's one time, doesn't get us to where we are
trying to get to in terms of we need ongoing money for ongoing commitments
because that's the way we do it. Part 2 of the question is this. Do we have
a sense of what things might be able to be aligned properly with the road
and bridge fund out of the fines and fees category that are general fund,
general funded right now? I知 thinking the j.p.'s are the constables at all
eligible, is any of the law enforcement out of the tcso eligible in terms
of the use of the fines and fee fund, which not only is healthy, it's getting
healthier as we go along in terms of moneys. Can we match some things in the
same strategy that we did with dana and the on 57 and 028 accounts of things
that traditionally had been funded by the general fund and we shift them to
another special fund revenue source that is absolutely within the letter of
the law.
>> there's kind of a fiscal architect texture simple answer
yes that we can do that. There's the accounting legal issue that I think has
not been fully explored. Then there are the practical implications. There
are employees, a wide variety of employees who are paid for out of the road
and bridge fund. Those happen to be all in t.n.r. One could pay for other
employees that are currently general employee funded out of the road and bridge
fund because they are in the business of collecting money that goes to the
road and bridge fund. So that logic is there. We have not explored the specific
techniques of how to accomplish that with the auditor's obvious and the j.p.'s
in no small part because -- because a simple way of doing it is this unallocated
reserve switch. But it need to be on an ongoing basis. What is proposed is
just a one-time infusion of resources that will be used up quickly and we
are right back where we started from. So -- so one -- you wanted to accomplish
it by charging employees, you could. But we really do need to work in greater
detail on what employees and you've got -- you might have time sheet issues
unless it's a full-time employee, in which case it's fully funded. But we
haven't explored that fully. Quite a few employees generate thank $3 million
that went over, used to go into the general fund, now into the road and bridge
fund.
>> but you are talking about programmatic cuts to the road
and bridge fund thereby. The initial question is should we start road reconstruction,
if that's what we are doing we can do that in order to accomplish permanent
savings. But I want to make sure we're clear. I知 looking for some direction
here. I've heard a spectrum of what's desired here. Permanent cuts, let's
cut out the road reconstruction, create permanent cuts versus short-term needs
in reserve areas, let's make the decision on road reconstruction at a later
time. So we can do either one. But it -- if we are talking about moving permanent
expenditures on to the road and bridge funds, it will come at the expense
of road and bridge programs.
>> let me get back to where I positioned myself a long time
ago. That is looking at the reconstruction projects already ongoing in precinct
1. As I told this court, told the public that it's nowhere in the -- no way
in the world I知 going to shortchange precinct 1 ongoing reconstruction projects,
all of these things, some in the pipeline now, probably some in the future.
I really don't know. In fact we have not yet had a report from the consultant
to let us know, on a whole bunch of these questions as far as reconstruction
is concerned, looking at the pavement program. Of course even today we looked
at -- look at the agenda today we had a couple of items here today whereby
we just added some minutes, we just -- some maintenance, we just accepted
maintains for a couple of programs, if we had the [indiscernible] system.
Once we accept these, things like that, we are going to have to continue to
maintain them. How we do that I think is something that we need to continue
to focus on, I think we've been doing a pretty good job. But at the end of
the day, I think that i've made myself perfectly clear. That precinct 1 is
going to continue my opinion to still continue to be served as has been currently,
also in the future. I don't want to jeopardize that at all. No one showed
or convinced me there would be any difference. Joe, I did understand that
you said maybe this year, next year, we kind of protected that. [indiscernible],
take care of those cch things. Maintenance, we have to main maintain those
roads once we accept them. Ones we accept them it comes to the county's tab
to maintain them. My question still comes back to that point. Option 1 appears
to be the most harmless, innoculous of the two options. The others acquire
debt service. [indiscernible] I hear what you are saying christian, I知 listening
to those folks out there needing their roads maintained, the way we are doing
right now seems to be prudent. [indiscernible] in my mind something not want
to venture out or even talk too much about. I知 pretty much convinced the
way we are going is a prudent way that we should proceed. Now that's my opinion.
Everybody has their own. But I just want to make sure that precinct 1 is not
shortchanged in all of what we're doing. I知 here to speak for precinct 1.
>> I would speak for precinct 4 as well, but I think what
happened is the reason we -- put this aside for east Travis County was that
there was a -- the -- the maintenance of roads and so we put that penny for
that use. The goal was to have all roads in all of Travis County have a 70%
-- 70% of -- of a good condition rating. And that goal was reached. And I
guess it was reached two years ago, joe?
>> 2001 is when we did our last --
>> so the only thing that happened here was that that report
didn't come back to the court. So that we could immediately take action on
-- on doing something else with that penny or continuing to have that penny
address the roads in east Travis County. And while I guess the conditions
in west Travis County are such that the roads are able to be built and maintain
understand much better condition than -- maintained in much better than than
in the clay dirt in eastern Travis County, of course I would like for precinct
4 roads to be in the same condition as precinct 3 and precinct 2 roads. Which
are like up at 97%. I think precinct 4 roads are at 85%. Whatever decision
this court makes, I think that we need to consider all of Travis County. And
so I think that's what -- what makes it necessary for us to really think about
the decision we make. Today.
>> let me go one step further. The 3.7 million that we did
back gosh what year was it, fiscal 1999 was a flat amount. A penny at that
time, it was a flat amount of 3.67 million. We actually took a little bit
off the top last year for a program that joe wanted to do with the t.n.r.,
So I知 going to round it up to 3.5, more than that, but close. It's a flat
amount of money. When this whole issue came forward with the fines and fees,
fines and fees was actually a better gig going into t.n.r. Than this $3.5
million. In fiscal 2003 '02, going from joe's memo, page 3, the actual fines
and fees revenue deposited in was $4.8 million. A -- 4.7 million, a whole
lot better than 3.5. In '03 up to $5 million. '04 the budgeted is 4.9. And
now we have got blane certifying in the fourth revenue estimate on page 7
of what we got from the auditor's office, certifying $5.2 million of moneys
that's going into the road bridge division. So I don't -- it's a growing amount
of money going in there.
>> but at the same time the license plate fee is going down.
You have also moved on to the road and bridge fund a capital [indiscernible]
certificates of obligation, in the same period of time you have moved all
of the debt from purchasing hot mix overlay and f mix on to the road and bridge
fund.
>> as we should. It was generating the money.
>> I understand. But even looking at just the revenue stream,
from the fines and fees, doesn't show you the whole picture.
>> there are expenditures associated with it. That's what
you are saying.
>> there's movement in both directions here.
>> okay. So did we end up rolling that one penny into the
general fund?
>> yes.
>> and we started relying on fines and fees to basically
do what the penny had been doing?
>> we were instructed to do that.
>> they were good instructions, I may add.
>> depend on the eyes of the beholder.
>> now, if our goal -- [laughter] -- if our goal is to realize
$3.5 million and at the same time do no damage to a payment management program
that is headed in the right direction, what's the best way to get it done?
Now, joe said doing a work session, budget work session that there is money
in reserve to cover at least one year, maybe even two.
>> two.
>> by the way I知 speaking for precincts, 1, 2, 3, 4, if
our goal is to make sure that we keep those programs, projects in place, fund
it sufficiently, but at the same time free up this money and give us a chance
to revisit this issue, during the next budget process and the one after that,
what's the best way to do it?
>> you asked two different questions.
>> the third was on the tip of my tongue but I haven't asked
it yet. Deal with one and two. [laughter]
>> if you free up one million in allocated reserve and you
spend it on, say, salaries, hypothetically. Or new programs or new f.t.e.,
You will get at least this one individual saying beware that is unwise, and
imprudent. You may ignore those observations.
>> that is not the best way then.
>> that is not a good way to do it. Now, if you take that
one million and put it into one time capital, one-time reserve, one-time this
or one-time that, then you have done it. But it is not going to solve some
of the other problems that this court is facing. This court has a shortage
in the general fund of ongoing resources and some of you believe that there
is a little surplus in ongoing resources in road and bridge. That really is
the nub of the issue.
>> so there is no best way to do $3.5 million that would
be ongoing?
>> there is a way of doing it. But not the way you described
because --
>> I didn't describe it.
>> what you -- I think what you described was how do you
free up 3.5 million dollar and still have this wonderful ongoing set of programs
in road and bridge. That's trying to find world peace among all of the countries
of the world.
>> that's tapping into reserve funds that joe says he's got.
>> that will happen for one year only because you have many
more than one million worth of needs and demand and I believe desires.
>> so no matter how we free up 3.5 million, it would be one
time?
>> no. It depends -- not if you change the programmatic direction
of that 3.5 million part of the it. This is an accordian, 500,000, 1 million,
3 million of ongoing direct programmatic commitment, that's just a judgment
call. It's not zero or 3 million. It could be anywhere in between. But I知
only urging you to make -- to not believe you can -- can set -- which is the
same thing joe was saying, reduce 3.5 million for 3 million and still have
the exact same thing that you have before. That's not possible.
>> okay.
>> joe, are these options that you laid out for us, which
one in your view is best for -- for t.n.r.?
>> do you want to increase the debt or not? I mean we can
give you one-time savings of $3.7 million under option 3. Without hurting
any program. But it does mean increases your certificates of obligation. If
you do not want to do that, another option is to reduce operating line items
within t.n.r., Drop those into the unallocated reserve, still net 3.7 million
bucks, but I can assure you that that is just a temporary deal without cutting
programs.
>> okay.
>> the only way that I can generate for you is $3.7 million
in permanent savings is by cutting programs. The one cent was originally involved
for road reconstruction. I can stop road reconstruction in fy '05 and generate
a permanent savings of 3.7 million bucks. I can't do that without affecting
the program. I would suggest that we -- from my perspective, we defer that
decision until I have the results of our pavement condition survey in October.
At that point, I think we should look at all of it, surface treatment, f mix,
hot mix overlay, reconstruction and reestablish the basis that we go forward
with maintenance on roads in all precincts. At that point, it may very well
be that for fy '06, I can generate a permanent savings without adversely affecting
the road conditions in any precinct.
>> christian, what was the general fund's contribution to
the t.n.r. Budget in '04? About?
>> um that answer will be forthcoming.
>> general fund contribution to the road and bridge, there
is no transfer. What is occurring is the fine revenue that is in the revenue
estimate is above and beyond the transfer amount. Therefore there is no transfer.
There is actually an increased unallocated reserve of 1.2 million. It was
increased by 312,898 for the preliminary budget to account for some of the
increase in the fine revenue.
>> okay. My question went to the contribution to t.n.r.
>> as a whole?
>> oh, oh, oh,.
>> your answer was road and bridge.
>> correct. I知 sorry. Was your question with general fund.
>> to t.n.r.
>> t.n.r. As a whole -- the preliminary budget in '05 has
a $15.1 million total contribution from general fund to t.n.r. And that's
the totality of t.n.r.
>> does it include parks?
>> that excludes bcp.
>> okay.
>> but there is a transfer --
>> we think we can find $3.5 million worth of t.n.r. Scmendtures
that are eligible for coverage by fines and fees funds?
>> interesting question. I think --
>> hi cynthia.
>> requires more work?
>> well, you will -- did you see the eyeballs looking at
each other.
>> what might be useful also is I have a memo from the county
attorney that I e-mailed the court, I have copies here for you that include
some information of what sorts of expenses are eligible. I will pass that
out just so that you have that for your file as well.
>> actually --
>> based on the opinion of learned counsel, very learned
counsel then -- do we think that this is worth pursuing or are we going down
the wrong track?
>> on page 2, if you look at I would say the third paragraph
down, items 1, 2, 3, tells you what exactly is eligible for road and bridge
expenditures, construct and maintain roads, bridges and culverts in the county,
enforce laws regulating the use of highways by motorcycle vehicle his and
to defray the expense of county traffic officer the. If trying to find 3 some
odd million in t.n.r. That's not already in road and bridge I would say the
answer is no, we can't do that. We have already realigned our salaries in
the '04 budget. To make sure that we were covering everything that needed
to be on road and bridge in road and bridge. As far as any of the other expenditure
line items, I don't see anything near that going on. We are pretty clean as
far as the division between the two funds.
>> however we know that we could defray the expense of county
traffic officers. Through the use of road and bridge funds. We know that we
could enforce laws regulating the use of highways by motor vehicles, if we
wanted to. I知 not suggesting that's what we want to. But we know we have
the capacity and legal capability of doing that. I think we know that we can
charge the cost of -- of certain employees and justices of the peace who are
used to -- whose mission is to generate the income that goes into the road
and bridge. I think those are some alternatives.
>> well, yeah, I was just addressing the judge's comment
on whether or not t.n.r. Could push anymore into the road and bridge fund,
for us the answer is no. There is still the opinion from tamara on this as
to what else can go under road and bridge fund.
>> option 2, is that all one-time money or is that split?
Is the $800,000 considered ongoing or one-time money under joe's option 2.
I already know about the 1.1, we have made very clear movement of the reserve
is one-time money.
>> depends on whether you continue to fund the 800 out of
co's or not.
>> yes, yes. I知 saying a -- hold harmless t.n.r. Asking
the question, clarification is the 800,000 shifting to a c.o., Is that ongoing
800,000 or one time.
>> I think it has to -- every year -- funded out of the c.o.
>> yeah.
>> so you would -- you would have every single year --
>> okay.
>> I知 going to consider it one time.
>> assuming that you are committed to f mix.
>> you will continue -- to pay for it that way.
>> especially related to our discussion this morning, with
mr. Collins. There is use for some one-time money. So -- so that's -- that
could be a helpful strategy that does not shift anything else over to debt,
just basically says hi we are going to swap out this money for that, you keep
the unallocated reserve whole and --
>> we probably, you have a letter to that effect from me,
can identify it. Quite a number of opportunities to get one time money. The
hard thing is ongoing money because the demand is for ongoing resources. That's
the -- that's where the -- the more difficult actions will lie. For some.
>> okay. Think a little more on my questions, not that I
did not like the answer, though I didn't. I知 not sure the answer was directly
responsive to what I was trying to ask for. Let me get with you about that.
>> all right.
>> I will get with both of you all later.
>> let me try asking a slightly different way. The park rangers
right now are on the pops scale, they are considered law enforcement officers
in addition to doing a lot of other great things. Would they be eligible for
I知 just asking the question, don't give me a face -- whether they will be
eligible, you don't have to answer me right now.
>> I can certainly see [indiscernible] out of park service
would be service.
>> any out of park service would certainly be eligible.
>> are you going to what charge off what time they spend
outside? They have the ability -- okay. I'll -- downtown have to answer right
now. The look told me everything.
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Last Modified: Thursday, October 27, 2005 11:05 AM