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City of Lee’s Summit Annual Budget FY15

Table of Contents Table of Contents

Section 1: Introduction .............................................................................................................5 History ................................................................................................................................... 6 Mayor and City Council ......................................................................................................... 8 Organization Chart ................................................................................................................ 10 Budget Calendar.................................................................................................................... 12 Section 2: Administrative Summary ..........................................................................................13 City Manager’s Budget Message........................................................................................... 14 Long-Range Strategic Planning in Lee’s Summit ................................................................... 27 Section 3: Budget Overview......................................................................................................41 Fund Structure and Overview Numbers ............................................................................... 42 Budget Ordinance ................................................................................................................. 51 Financial Policies ................................................................................................................... 55 Section 4: Revenue Projections.................................................................................................70 Section 5: General Fund Overview ............................................................................................82 Section 6: General Fund Department Budgets ...........................................................................93 Administration ...................................................................................................................... 94 Codes Administration ........................................................................................................... 100 Municipal Court………………………………………………………………………………………………………………107 Development Center……………………………………………………………………………………………………….111 Finance .................................................................................................................................. 117 Fire ........................................................................................................................................ 123 Law ........................................................................................................................................ 129 Planning and Development................................................................................................... 135 Police ..................................................................................................................................... 141 Public Works Engineering ..................................................................................................... 148 Public Works Operations ...................................................................................................... 153 Section 7: Special Revenue Funds .............................................................................................161 Parks and Recreation Funds.................................................................................................. 163 Other Special Revenue Funds ............................................................................................... 205 Section 8: Capital Projects Funds ..............................................................................................209 Section 9: Proprietary Funds.....................................................................................................226


Table of Contents

City of Lee’s Summit Annual Budget FY15

Internal Service Funds........................................................................................................... 229 Enterprise Funds ................................................................................................................... 255 Section 10: Debt Service Funds .................................................................................................267 General Obligation Debt ....................................................................................................... 269 Park COP Debt ....................................................................................................................... 273 Appendix .................................................................................................................................274 Glossary................................................................................................................................. 275 Miscellaneous Statistics ........................................................................................................ 286


Introduction

City of Lee’s Summit Annual Budget FY15

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City of Lee’s Summit Annual Budget FY15

Introduction HISTORY

Over a hundred years ago, the small 11 block Town of Strother straddled the Missouri Pacific Railroad tracks. Today, that small town consists of 65.24 square miles and is known as the City of Lee's Summit. In the late 1800's, a man by the name of William B. Howard was drawn to this fertile, gently rolling prairie land with the dream of building a city. Today, nearly 93,000 residents have been enticed to this progressive, yet restful and family-oriented community atmosphere, with a unified dream to create a dynamic, vital city. From yesterday to today, the story of this once small town has been filled with the courage, dedication, and quiet determination of its citizens, making Lee's Summit an ideal city in which to live and work. On October 28, 1865, William B. Howard founded the Town of Strother by filing a plat containing the 11 blocks that currently encompass the downtown business district. At the time of incorporation, the population count stood at one hundred people. In November of 1868, the name was changed and the area incorporated as the "Town of Lee's Summit". Although the "Summit" portion of the name was obviously based on the fact the town's elevation is the highest point on the railroad between Kansas City and St. Louis, there are numerous opinions and theories on the origin of "Lee". According to one theory, the town was named after Civil War General Robert E. Lee, since incorporation took place shortly after the war and the majority of citizens migrated from the Southern states. However, another version suggests the town was named after a prominent early settler, Dr. Pleasant Lea. The discrepancy in the spelling of "Lea" has been attributed to railroad sign painters. Lee's Summit's most infamous citizen was Cole Younger, called "The Last of the Great Outlaws" by author Homer Croy. According to history, soldiers drove Younger to a life outside the law after his father's murder and subsequent robbery. While Union forces were enforcing Order #11, the command issued in 1862 ostensibly to burn homes belonging to those with Southern ties, Younger and his brothers were credited with saving some of the original homes within Lee's Summit, the most prominent of which belonged to William B. Howard. Order #11 helped to unify the transplanted southern population in Missouri and compelled Younger to join the Confederate guerrilla band known as Quantrill's Raiders. Cole Younger was arrested after an attempted bank robbery in Northfield, Minnesota. Following 25 years of imprisonment for his crimes, Cole Younger was paroled in 1901. Three years later, Younger returned to Lee's Summit where he lived as a model citizen until his death in 1916. His grave is located in the Lee's Summit Historic Cemetery. The Fire of 1885 demonstrated yet again the stamina personified by citizens in Lee's Summit. While most of the town's residents were attending Sunday morning church services, fire erupted in the downtown district, which consisted of dry, wooden buildings. A detailed account of the fire, as printed in the April 16, 1885, issue of The Lee's Summit Journal, stated the buildings burned "...like greased wood". Virtually the entire business district was destroyed and the loss aggregated at $87,000, with a total of 25 buildings consumed by the flames. However, the stalwart citizens took their losses in stride and promptly commenced to rebuild the town. Almost 30 years later, Mr. R. A. Long, a prominent Kansas City lumberman, began building his dream, which became a reality with the construction of Longview Farm. In 1912, Mr. Long purchased 6|Page


Introduction

City of Lee’s Summit Annual Budget FY15

approximately 1,700 acres in the southwest portion of Lee's Summit. Mostly self-sufficient, the farm included five major barn groups and 42 buildings. When completed and functional, Longview Farm became internationally known for the horses and livestock contained within its white rail fences and was one of only three dozen such showplace farms. The history of Lee's Summit abounds with the tragedies and triumphs of courageous people who have never failed in their dream of creating a city that will continually progress and prosper. Most importantly, Lee's Summit is comprised of dedicated people who never lose touch with the basic values that make a community livable. We feel Lee's Summit has lived up to the dreams of its forefathers.

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City of Lee’s Summit Annual Budget FY15

Introduction

City of Lee’s Summit Mayor and City Council

District 1

Rob Binney

Mayor Randy Rhoads

Dianne Forte District 3

Derek Holland

District 2

Patricia Carlyle

Allan S. Gray II

District 4

Dianne Seif

Bob Johnson

Dave Mosby

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City of Lee’s Summit Annual Budget FY15

Introduction

The City of Lee’s Summit operates under a Mayor/City Council form of government. Mayor The Mayor is elected at-large for a four-year term and is recognized as the head of the city for all legal and ceremonial purposes and by the Governor of Missouri for all purposes of military law. The Mayor presides at City Council meetings, executes all ordinances, resolutions, proclamations, grants and executive orders. Any ordinance or resolution adopted by the City Council may be vetoed by the Mayor; however, the Mayor may only vote in the event of a tie. The Mayor presents a State of the City address at least once annually as to the affairs of the city and any recommendations of the Mayor. City Council The City Council consists of eight members. Two Councilmembers are elected by qualified voters from each of the four respective districts of the city, as provided by Section 9.4, City Council Districts. City Councilmembers shall be elected to serve staggered four-year terms. At each regular municipal election, Councilmembers shall be elected to fill the offices of those whose terms expire. Budget Committee A new City Council standing committee was established by Ordinance 7145 on February 16, 2012. This committee’s purpose is to review the City Manager’s proposed budget prior to its consideration by the City Council. The committee shall report on all bills, proposed ordinances, measures or questions referred to it pertaining to appropriations and the overall financial condition and future needs of the City. For the FY15 budget process, the committee consisted of the following members: Bob Johnson, Chair Allan Gray Rob Binney David Mosby

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City of Lee’s Summit Annual Budget FY15

Introduction

Organization Chart

Governmental Fund Types

Proprietary Funds

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Introduction

City of Lee’s Summit Annual Budget FY15 AWARD FOR DISTINGUISHED BUDGET PREPARATION

The Government Finance Officers Association of the United States and Canada (GFOA) presented a Distinguished Budget Presentation Award to the City of Lee’s Summit, Missouri for its annual budget for the fiscal year beginning July 1, 2013. The award reflects the City’s commitment to meeting the highest principles of governmental budgeting. This signifies that Lee’s Summit’s budget rated proficient in serving as: a policy document, a financial plan, an operations guide, and a communications device. This award is valid for a period of one year only. We believe our current budget continues to conform to program requirements, and we are submitting it to GFOA to determine its eligibility for another award.

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City of Lee’s Summit Annual Budget FY15

Introduction 2014 – 2015 Budget Calendar

The annual budget calendar is developed by the City Manager and Chairman of the Budget Committee. The calendar includes the Budget Committee meeting schedule and important milestones to guide the budget process.

FY 15 Budget Calendar Overview August 6, 2013 September 17, 2013 October 8, 2013 November 2013 November 11, 2013 6:00 PM December 9, 2013 2:30 PM December 10, 2013 January 6,2014 January 13, 2014 6:00 PM January 25, 2014 January 2014 February 1, 2014 February 3, 2014 February 3, 2014 February 3, 2014 February 10, 2014 6:00 PM February 20, 2014 February 2014 March 10, 2014 6:00 PM April 29, 2014 6:00 PM May 6, 2014 6:00 PM May 7, 2014 6:00 PM May 12, 2014 6:00 PM May 13, 2014 6:00 PM June 5, 2014 6:15 PM June 19, 2014

August 2013 MT meeting: Review of FY15 projected financial condition September 2013 MT meeting: Outline of reduction process October 2013 Budget Committee Meeting: Agenda: Review FY13 YE, Review FY14/15 General Fund Assumptions, Discussion of FY15 Reductions November 2013 MT analysis of reductions due Budget Committee Meeting: Agenda: Police Personal Changes, Fund Balance Discussion December 2013 Budget Committee Meeting: Agenda: Use Tax presentation (MODOR) MT Meeting: City Manager review of department proposed reductions January 2014 ITS Expansions are due Budget Committee Meeting: Agenda: Review of financial condition (5 Year Model), Gap analysis reductions All FY14 year end projections due Departments prepare FY14 budget requests February 2014 Fleet & HR Expansion requests due FY15 Internal Services & Core Expenditure numbers due City Manager Review of FY14 YE Projections Changes to the Schedule of Fees Due Budget Committee Meeting: Agenda: FY14 Projections, Continued: Gap Analysis Reductions Department budget meetings with City Manager begin Parks and Recreation budget to Park Board March 2014 Budget Committee Meeting: Agenda: FY15 revenue projections, Changes to Schedule of Fees April 2014 Budget Committee Meeting: Agenda: Presentation of City Manager's proposed budget May 2014 Budget Committee Meeting: Agenda: Continued review of City Manager's proposed budget Budget Committee Meeting: Agenda: Continued review of City Manager's proposed budget Budget Committee Meeting: Agenda: Continued review of City Manager's proposed budget Budget Committee Meeting: Agenda: Continued review of City Manager's proposed budget June 2014 City Council Meeting: PUBLIC HEARING City Council Meeting: Vote on Ordinance

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary

April 29, 2014

CITY MANAGER’S BUDGET MESSAGE

Mayor Rhoads and Council members, Financial decisions should be made in context of our vision and strategic plans. How a person spends their money reflects that individual’s values. It is the same for an organization. As you will soon discover as you read this message and review the proposed budget, our organizational values are reflected in how we assign our resources; safety, quality of life, and economic opportunity. Vision Statement of the Lee’s Summit City Council: As the elected body of the City of Lee’s Summit, Missouri, we are collectively in pursuit of; A culturally rich community with diverse economic sectors to create a prosperous and dynamic community in perpetuity.

Over the years, one of the City’s strengths has been its strong financial condition and prudent financial management. The City’s elected officials, Management Team, and budget staff have diligently developed and implemented annual budgets that provide our citizens consistent, reliable municipal services and programs. The fiscal year 2014-2015 (FY15) budget represents a continuation of these practices despite adverse economic conditions.

I.

Budget Request

The City has approximately 70 different funds, each categorized by purpose. We are proposing a comprehensive expenditure of $183.8M. This includes all proposed funding for daily operations, capital improvements, debt service, internal service and enterprise operations.

Total Budget

GENERAL FUND SPECIAL REVENUE FUNDS DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS ENTERPRISE FUNDS INTERNAL SERVICE FUNDS

$ $ $ $ $ $

FY14 Budget 58,393,223 11,577,795 9,240,571 66,981,933 43,083,463 11,094,093

FY15 Proposed $ 60,845,976 $ 20,465,656 $ 11,935,213 $ 30,765,038 $ 48,022,709 $ 11,772,670

TOTAL PROPOSED EXPENDITURES

$ 200,371,078

$ 183,807,262

FUND

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary

The General Fund: This fund includes budgets for 10 departments that provide the mission critical services to our residents, such as police and fire protection, street maintenance, planning, codes, court, and general administration of the City. Special Revenue Funds: Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than expendable trust or major capital project) requiring separate accounting because of legal or regulatory provisions or administrative action. This includes the Parks, grants, business and industry, tax increment financing (TIF), and transportation development district (TDD) funds. Debt Service Funds: The city utilizes two funds to record the receipt and disbursement of monies used to repay principal and interest charges on city issued debt. The General Obligation Debt Service Fund and Park COP Debt Service Fund are used to account for the annual retirement of bonds issued from 2003 through 2014. Capital Project Funds: The capital improvement funds include budgets that allocate expenses for infrastructure improvements. The City’s capital projects are funded by a variety of different sources. The City’s road and bridge maintenance projects and capital improvements are funded by a ½ sales tax. Other projects are funded by tax increment financing and through the sale of general obligation bonds.

FY15 Budget Request

6% 33%

26%

GENERAL FUND SPECIAL REVENUE FUNDS DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS ENTERPRISE FUNDS

11%

17%

INTERNAL SERVICE FUNDS

7%

Enterprise Funds: The City’s enterprise funds hold the budgets for departments that operate in business-type activities. These funds rely on revenues generated from sales of materials or services. The enterprise funds include budgets for our Water Utilities, Solid Waste, and Airport activities. Internal Service Funds: The City uses internal service funds, or Proprietary Funds, to account for its fleet of vehicles and equipment, information technology systems, central building services, and trust funds. The internal service departments allocate costs for the reimbursement of services to other departments. With these funds it is my intent to assign resources in support of the City Council’s goals, maintain the needed levels of service, and pursue strategic initiatives that would benefit the City. Key Initiatives funded in the FY15 budget include: • Increase focus on economic development: New resources have been allocated to support the recently adopted City Council vision for economic development. The vision;

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2: Administrative Summary

City of Lee’s Summit Annual Budget FY15

Economic Development Vision Statement of the Lee’s Summit City Council: Lee’s Summit will build upon and promote its unique downtown, educational excellence and cultural heritage to create and nurture a business environment which fosters entrepreneurship, commercial and neighborhood redevelopment, and the attraction and retention of high quality jobs in targeted businesses. In doing so, the tax base will grow ensuring the City’s continued ability to deliver an outstanding quality of life and services to both businesses and residents. To realize this vision, it is necessary for the City to begin marketing Lee’s Summit as a place for business opportunities and investments. We have proposed a two step approach with the inclusion of a marketing and economic development program. The targeted outcomes of the new economic development program will be driven by our pending discussions with our economic development partners. Additionally, in FY15, the City will launch a new business licensing process which will help gather market and demographic information to aid in data driven decision making. •

Update of community planning documents: The City utilizes a variety of strategic planning documents to ensure that our resources are achieving the greatest return on investment. A proposed update to the Thoroughfare Master Plan, last updated in 2006, will achieve this result as staff and stakeholders identify needed road improvements to alleviate traffic accidents, congestion, as well as economic development considerations. The 2006 Plan was an effective tool that assisted us with prioritizing our “no-tax increase” transportation projects and ½ cent capital improvement sales tax projects. Our recent citizen satisfaction survey indicated significant improvements in traffic flow and reduced congestion. Creating a forward thinking plan and implementing it was a primary key to our success. The new plan and updating the City’s Comprehensive Plan and Economic Development Impediment Map will help direct resources to meet the highest and best use.

Improve organizational capacity: The rapid growth of our community brought new challenges in delivering services and managing operations. The City’s Management Team has been asked to identify new methods or processes that improve efficiency while keeping or improving our mission critical services. One example proposed in this budget, seeks to shift the task of repairing concrete to contractors who have the ability to deliver these services faster and at less of an expense while freeing up our remaining workers to pursue other repair and maintenance activities. This budget recognized efficiency opportunities utilizing existing, internal resources to provide additional services instead of contracting-out. For example, Central Building Services will begin providing custodial services to Water Utilities.

Enhance communication: As we enter the new phase of the City’s Performance Excellence program, the City will explore more ways to improve how we keep our audiences informed and engaged. The results of the 2013 Citizen Survey indicated a 5% decrease in satisfaction with our efforts to keep residents advised of issues they may find of interest or impact them. Citizens expect accurate and timely information through many communications sources. We have increased the frequency and amount of information. However, the content and method of our

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary

communication needs to be reviewed. Knowing how to convey information to the right audiences is important so I am recommending an organizational communications audit for funding in the FY15 budget. In the remainder of this document, we will discuss how these initiatives are funded within the budget. This budget request will serve as a financial and operational plan, communication device, and a policy document for our organization

II.

Review of Financial Condition – General Fund

Before we review the proposed budget in this document, I want to review the fiscal opportunities and challenges before us so that everyone has a clear understanding of “why” and “how” the FY15 budget was created. The City’s Budget Committee and City Manager frequently reviews the General Fund five year model throughout the year to monitor our progress and make an necessary adjustments. The model is our financial planning tool that assists us in knowing the financial impact of policy decisions while projecting the financial condition of our General Fund. Another key benefit in using the model is that it illustrates global economic trends like the ones created by the 2007 recession. Data from the Federal Reserve gives us two key indicators regarding the recovery from the 2007 recession. First, recovery from the most recent recession has been slower than any other recovery time period. Second, the 2007 recession had a stronger impact on our City than past recessions because of its impact to the housing and commercial sectors of our economy. Nonfarm Employment Recovery

Real GDP Recovery Data

16.0 14.0 12.0 % Increase

The effects of the recession began to become evident as we prepared our annual budgets. In 2013, the model began to project a structural deficit, showing that our reoccurring revenues were insufficient to fund projected operating expenses. To limit service

18.0

10.0

1980

8.0

1981

6.0

1990

4.0 2.0

2001

0.0

2007*

-2.0

30

12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 Months After Start of Recovery

20 1973 15

1980 1990

10

2001 2007*

5

Quarters After Start of Recovery

Q24

Q23

Q22

Q21

Q20

Q19

Q18

Q17

Q16

Q15

Q14

Q13

Q12

Q11

Q9

Q10

Q8

Q7

Q6

Q5

Q4

Q3

Q2

Q1

0 Q0

Real GDP: Cumulative % Increase

-4.0 25

disruptions, the City budgeted for the use of reserve funds to stabilize funding for City operations while continuing to recover from the 2007 economic recession. The use of these funds was recognized as a short term solution necessary to maintain service levels without jeopardizing the City’s future financial condition.

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2: Administrative Summary

City of Lee’s Summit Annual Budget FY15

To incrementally reduce the reliance and use of reserve funds, the Budget Committee and City Manager identified $1.1M of expenditure reductions in the FY14 budget. This action resulted in total budgeted revenues, including one time revenues of $1.1M, exceeding expenses by $537k. As in the past, our midyear projections show budgetary savings will create a balanced budget where regular reoccurring revenues are sufficient to fund our daily operations.

Despite modest revenue growth and reduced expenditures, the projected budget deficit for FY15 totaled approximately $1.8M. The goal for this budget is to incrementally reduce operating expenditures so that they may be funded by our regularly reoccurring revenues. To achieve a balanced budget, I have prepared a two year plan and corresponding FY15 annual budget which will place us on the track to diminish the projected deficit in two years. Traditionally we do not fully expend the amount budgeted for operations every year. If this occurs for FY15, this will assist us in creating a balanced budget by FY16.

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary A traditional approach in solving for a budget deficit is to look at growing revenues and eliminating line item expenditures. While this approach is beneficial, implementation often fails to make structural adjustments like the ones necessary for a long term, positive financial condition. As seen with last year’s budget, approximately $1.1M of expenses was eliminated, still in FY15, we are faced with fiscal challenges because our fixed expenses, even while at reduced levels, continue to outpace our revenue growth. The two year plan, as I have proposed, will address the structural deficit in the following ways: •

‘Right Sizing’ the Organization: Our costs associated with personnel consume 71% of our general fund. Our municipal service levels are directly impacted by the availability of well trained and engaged employees. Reducing this cost while maintaining or improving our municipal service levels is our challenge. In this budget, I have proposed a temporary retirement benefit program that will assist those considering second

City Manager's Proposed Budget General Fund 2 Year Plan

Operating Budget FY15 Request 58,924,132 60,554,901

Beginning Projected Revenues: Beginning Projected Expenses:

FY16 Projected 59,493,559 61,854,542

1. 2. 3. 4. 5.

Revenue Enhancement Proposals: Recover CDBG Admin Expenses: 60,000 Summit Place revenues: 0 Inflationary Increase Property Tax 0 Inflationary Increase Sales Tax 0 Use Tax 0 Sum: 60,000

60,000 75,000 268,943 202,171 300,000 906,113

1. 2. 3. 4. 5.

Expenditure Additions: Lifepack replacement 0 Community Marketing Program 140,000 Economic Development Program 200,000 Implementation of Compensation Study 83,807 ITS Projects 137,530 Sum: 561,337

180,000 125,000 200,000 0 200,000 705,000

Significant Expenditure Reduction Proposals: 1. Support to Boards & Commissions -35,350 2. Support to Public Service Agencies -62,000 3. Reduce operating time for streetlights 0 4. Find alternative funding for Legacy Blast 0 5. Contract for concrete repairs -199,655 6. Health Insurance Cost Control Measures -564,171 7. Personal Services Cost Reduction 0 8. Reduce City Scope from 4 to 2 -23,300 9. Reduce funding for Holiday Party -2,000 10. Eliminate Legislative Services -6,000 11. Extend life of Patrol Vehicles -70,786 12. Public Safety Education Programs -7,000 Sum: -970,262

-35,350 -62,000 -93,000 -24,000 -199,655 -103,958 -1,532,820 -23,300 -2,000 -6,000 -70,786 -7,000 -2,159,869

Operating Budget (with proposals) Total Revenues Total Expenses Net Income:

58,984,132 60,145,976 -1,161,844

60,399,673 60,399,672 0

Reserve (Fund Balance) Spending Proposals: 1. Retirement Maximization Program Expense 700,000 Sum: 700,000

0 0

Total Proposed Total Revenues

58,984,132

60,399,673

Total Expenses (with one-time) Net Income:

60,845,976 -1,861,844

60,399,672 0

Net Change in Fund balance Fund balance—beg.

15,881,071

14,019,227

Fund balance—end.

14,019,227

14,019,227

23.04%

23.21%

Ending fund balance as a % of expenditures (w ith onetime)

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2: Administrative Summary

City of Lee’s Summit Annual Budget FY15

careers or new challenges with an opportunity to transition from City employment. Participating employees will benefit from an additional payment to a health benefits trust account allowing them to plan for retirement with a sense of confidence and comfort knowing there are resources set aside for health related expenses. This will allow the City to carefully and strategically refine the alignment of workforce resources to critical services. •

Refining the Levels of Service: In 2013, the City conducted a citizen satisfaction survey to gather input on the quality of City services, measure levels of satisfaction, and identify areas of improvement. In most cases, within the metropolitan area, the City of Lee’s Summit set the benchmark for the quality of those services, amount of services provided, and the professional delivery of services. This budget proposes reducing the funding for the services that have the least amount of impact to our residents, limits overservicing, and aligns resources to fund activities that are crucial to carry out our mission.

Investing in the Future: To correct our structural deficit, we must look for growth opportunities. In support of the City Council’s Economic Development vision, the budget has been developed to increase the funding of economic development efforts. The City’s new Development Center has been created to help streamline the economic development process by making it more customer oriented, efficient, and responsive. In addition, we are assigning additional resources to support our efforts to attract and retain key economic development investments that will ultimately increase our property, sales, and utility tax base. Our goal is to create a broader diversity of economic activities to lower our reliance on residential and retail economic sectors. These activities will be done in partnership with our other support organizations such as Downtown Lee’s Summit Main Street, Lee’s Summit Economic Development Council, and Chamber of Commerce.

Broadening the Revenue Stream: Capturing lost revenues is paramount for the continued success of our community. Lee’s Summit is not unique as it relates to new consumer habits and consumer choices. Adoption of a use tax would greatly improve the City’s financial condition by collecting lost sales tax on purchases made out of state. Failure to collect this tax places Lee’s Summit businesses at a disadvantage in the market place. While the decision to pursue this tax rests with the Council and voters, it has been proposed as a recommendation in the two year plan.

As elected officials and leadership staff we must commit to resolve the structural deficit while continuing to provide essential services to the citizens of our community. The careful, deliberate use of General Fund reserves is necessary to ensure that this issue can be achieved, in a planned, structured, and incremental fashion to minimize the service level impact of reductions to the Lee’s Summit community.

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2: Administrative Summary III.

City of Lee’s Summit Annual Budget FY15

General Fund Overview

The total proposed General Fund budget is $60,845,976. These expenses are funded by total projected revenues of $58,984,132 with additional funds of $1.8m coming from the reserve balance. These amounts were calculated using a modified zero based budgeting approach, historical averages, and conservative forecasting. General Fund Revenues: General fund services are funded by three major revenue sources; property taxes, sales taxes, and franchise taxes. These revenues account for approximately 77% of all general fund revenues in FY15 compared to 76% in the previous year. Overall, for FY15, revenues are expected to be $53k, or .1%, above last year’s amount. Key Revenue Variances: • Sales Tax: FY15 revenues estimate a 1.5% increase from FY14 year end projections. Our year end projections show an approximate 1% increase above the FY14 budget amount which included a 1.5% increase from FY13. Additionally, a new development at Todd George & US Highway 50 is expected to add $91K when it opens mid year. •

Property Tax: The FY15 FY14 FY15 Change from FY14 Budget $ % Budget Requested amount was calculated using Account Property Taxes 17,453,036 17,929,506 476,470 2.7% the final property tax Sales Taxes 13,271,010 13,478,056 207,046 1.6% 14,076,315 13,978,424 -97,891 -0.7% assessment from the Franchise Taxes Motor Vehicle Taxes 2,960,656 3,189,933 229,277 7.7% previous year while factoring Other Taxes 342,236 312,041 -30,195 -8.8% a conservative growth Fines & Forfeitures 1,519,417 1,328,566 -190,851 -12.6% 1,279,490 1,568,441 288,951 22.6% projection. In FY15, it is Licenses & Permits Intergovernmental 829,576 815,470 -14,106 -1.7% projected that the City will Charges for Services 3,521,327 3,633,578 112,251 3.2% have approximately 300 new Investment Earnings 90,684 79,405 -11,279 -12.4% 1,591,091 1,664,410 73,319 4.6% home starts which are Other Transfers In 1,996,350 1,006,302 -990,048 -49.6% individually valued at $150k. Total 58,931,188 58,984,132 52,944 0.1% Combined with the final FY14 property tax assessment, new home starts, and .5% inflationary growth rate, the total assessed value of property for the City is expected to increase $15M. This will result in approximately $325k in new revenues.

Franchise Tax: As a group, franchise tax revenue is budgeted to show little or no growth from the FY14 budget. Milder temperatures in the current year and previous year have slightly adjusted the 2 and 3 year averages for these revenues. Current consumption rates and gross receipts are expected for the upcoming year. Electric and Natural Gas franchise tax revenues are expected to be -1.1% and 2.0% above FY14 budget amounts, respectively.

Transfers In: FY14 marked the final payment for a General Fund loan to the Parks department to fund the construction of the Gamber Center. The previous year’s payment was $1.0m which will not be received in FY15.

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary •

License, Permits, and Fees: In FY15 budget amounts were revised to more accurately forecast revenues stemming from economic development projects. In the past, these revenues were held below average amounts in response to the nation’s economic recession. In the current year, the City has seen an increase in both residential and commercial development.

6%

Property Taxes

2%

Sales Taxes Franchise Taxes 30%

Motor Vehicle Taxes Other Taxes

5%

Fines & Forfeitures Licenses & Permits Intergovernmental Charges for Services

24%

Investment Earnings 23%

Other Transfers In

General Fund Expenditures: Continued expenditure reductions are necessary in FY15 and FY16 to correct a structural deficit that threatens the City’s positive financial condition. The 2 year plan, as outlined, will incrementally correct this issue while minimizing the impact of service reductions to our citizens. Planning for these reductions over a two year period will allow the City Council and staff to make needed investments to help offset the need for reductions in future years. Key Expenditure Variances: •

Personal Services: Employee FY14 FY15 Change from FY14 Budget Budget Requested $ % expenses make up 71% of all Account Personal Services 41,260,988 42,768,838 1,507,850 3.7% General Fund expenditures. Supplies for Resale 135,880 137,980 2,100 1.5% 7,491,786 7,946,380 454,594 6.1% Because this category makes up Other Supplies/Services & Maintenance 1,292,364 1,301,073 8,709 0.7% such a large share of expenses, Repairs Utilities 1,641,226 1,723,693 82,467 5.0% it is necessary to seek savings Fuel & Lubricants 692,078 692,853 775 0.1% 119,154 129,680 10,526 8.8% and reductions in this area to Miscellaneous Capital Outlay 0 0 0 n/a positively impact our financial Interdepartmental Charges 5,199,217 5,413,811 214,594 4.1% condition. Reducing line item Transfers 560,532 731,668 171,136 30.5% 58,393,225 60,845,976 2,452,751 4.2% expenditures, or the other 29% Total of the budget, will not solve the problem. Part of my plan to ‘right size’ the organization will reduce these expenses by offering a retirement maximization program and health insurance cost control measures. The City’s future workforce will need to be compensated appropriately as the employees will likely be challenged to take on additional tasks and responsibilities from those transitioning from City employment and to ensure that our talented professionals are retained. To address this issue, I have included a performance based merit increase of 2%, or approximately $800k and the implementation of phase 3 of the Evergreen Compensation and Benefit Study with estimated costs of $83k.

Other Services and Supplies: In FY14 City staff eliminated approximately $1.1M of expenses which were primarily made up of line item expenditures for supplies, contracts, and professional services. These reductions remain in place for FY15, but investments for growth opportunities have been included. The addition of a marketing program ($140k) and economic development program ($200k) will help offset the need for future reductions by seeking ways to change the net income equation by fostering revenue growth.

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9%

2: Administrative Summary

3% 2%

Personal Services

City of Lee’s Summit Annual Budget FY15 Supplies for Resale Other Supplies/Services Repairs & Maintenance

13%

Transfers: For the upcoming fiscal year, the City must fund needed projects to ensure essential services are provided in a dependable manner. The General Fund will need to transfer approximately $137k for the replacement of our cashier system and EMS dispatch software to limit disruptions for these key services.

IV.

Utilities Fuel & Lubricants Miscellaneous 71%

Capital Outlay Interdepartmental Charges Transfers

Capital Project Funds

The 2015-2019 Capital Improvement Plan (CIP) has been divided into eight major categories, plus the Public Works and Water Utility Programs. The total estimated cost of all projects included in the fiveyear plan is $296,055,000. All funding sources that may be used for various capital improvements are reviewed each year. Much of the work to develop the CIP focuses on the balancing of available resources with the identified capital needs. Consideration must be given to factors such as annual revenue projections from various sources, restrictions on the uses of certain funds, legal limitations on debt capacity, and City policies relative to project funding. For budgeting purposes, the first year’s funding is included in the annual budget with subsequent years funding added to each future annual budget respectively.

Capital Project Funds FY14 Budget *Water & Sewer Construction 21,728,433 Bridges, Streets, Signals 29,698,000 Facilities 7,659,000 Capital Equipment Replaceme 803,500 Airport 4,579,000 Parks Construction 1,043,000 65,510,933 Total

FY15 Proposed 14,269,038 12,020,000 2,634,000 1,042,000 425,000 375,000 30,765,038

*Net Budget (without transfers)

In FY15, major CIP projects receiving funding include: • Blackwell Road Interchange with US50 - $6.96M • Orchard Street - $2.4M • Ward Road: Route 150 to Raintree Prkwy - $1.21M • Legacy Park Amphitheater - $1.4M • Sanitary Sewer Rehab - $1.4M • Water Main Rehab - $2.0M

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary V.

Enterprise and Internal Service Funds

Enterprise and Internal service funds receive revenues from user fees and charges directly from internal and external customers. These funds are not directly supported by tax revenue, but by charges to City departments and users. Included in these funds are the Water Utilities, Airport, Harris Park, Resource Recovery Park (Enterprise Funds) and the Fleet Management, Building Services, and Information Technology Funds (Internal Service Funds). Enterprise Funds FY14 Budget Water/Sewer Fund 32,734,792 Airport Fund 6,185,151 Solid Waste Management 2,984,830 Harris Park Community Ctr 1,178,688 Total 43,083,460

FY15 Proposed 39,029,733 4,734,696 3,044,178 1,214,103 48,022,709

Key Initiatives funded in the FY15 budget include: • • • • • • • • • • •

Internal Service Funds FY14 Budget Central Building Services 1,299,233 Fleet Operations 5,191,510 ITS Services 3,554,883 Short Term Disability Fnd 35,905 Unemployment Trust Fund 28,739 Claims & Damages Reserve Fun 150,000 Work Comp Self Insurance 833,823 Public Safety Equip Replcmt Fd Total 11,094,094

FY15 Proposed 1,278,893 5,384,791 3,947,778 32,954 33,931 150,000 906,418 37,905 11,772,670

Pad construction for relocation of Household Hazardous Waste (HHW) and Recycling drop off (Solid Waste Management Fund) Implementation of a mattress recycling program (Solid Waste Management Fund) Storm water pond expansion (Solid Waste Management Fund) FY15 Airport Construction project (Airport) Development of risk management program for sewer lateral repairs (Water Utilities) Implementation of a new meter replacement program (Water Utilities) Pursuit of a national accreditation program (Water Utilities) Evaluate compressed natural gas (CNG) vehicle replacement (Fleet) Mobilize two new wing plows for snow removal (Fleet) Intergrate new voice/data recorder for 911 and EMS dispatch (ITS Services) Update cashiering software for compliance with Windows 7 (ITS Services)

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VI.

Workforce

Workforce, or employee counts, is described as a ratio of full time equivalents (FTE) where one full time employee is estimated to work 2,080 hours annually or 2,912 for certain fire department personnel. The General Fund saw a slight decrease in FTE’s budgeted after vacant positions in the Public Works department were eliminated. The tasks assigned to these positions can be achieved in a more efficient and cost effective manner through the competitive bidding process.

Fund General Fund Parks & Recreation Water Utilities Airport Solid Waste CBS Fleet ITS Total

VII.

Full Time Equivalents (FTE) FY13 FY14 FY15 545.26 531.24 528.74 116.98 116.18 113.95 59.98 59.98 59.5 7.04 6.3 6.22 15.15 14.8 14.8 8.75 8.75 8.62 9 9 9.12 26.23 26.23 25.89 788.39 772.48 766.84

Change from FY14 $ % -2.5 -0.5% -2.23 -1.9% -0.48 -0.8% -0.08 -1.3% 0 0.0% -0.13 -1.5% 0.12 1.3% -0.34 -1.3% -5.64 -0.7%

Summary

The annual budget as I have presented represents many challenges, but yet opportunities to maintain and improve the financial condition for the City of Lee’s Summit. It is clear from the direction given by the City’s elected officials that growth, economic development, and wise financial planning are imperative to accomplishing our vision and mission as an organization. This budget has organized resources in support of the Council’s goals and directives while continuing to provide for essential services. This proposed budget and two year plan was crafted to ensure financial stability and encouraging economic growth opportunities. The continued growth of our community depends on investing in economic development efforts while looking for efficiencies within our organization. This budget and the two-year plan is a strategic step towards creating a financial and operational plan to direct our future. I would like to express my appreciation for our Management Team and budget staff for their assistance in developing our FY15 budget. Sincerely,

Stephen Arbo City Manager

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2: Administrative Summary

City of Lee’s Summit Annual Budget FY15

*Note:* The City Manager’s proposed budget as outlined in this document was amended following Budget Committee recommendations made on May 12 and May 13, 2014. The final proposed budget was presented to the City Council on June 5, 2014 for a public hearing. The budget was adopted by ordinance on June 19, 2014. For more details on the amendments and the final adopted budget please see the ‘Budget Overview’ section on page 47.

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Guiding Documents The City of Lee’s Summit actively participates in strategic planning to improve organizational capabilities by embracing a cycle of continuous improvement. These plans help organize resources to ensure optimal results are achieved. The City has three guiding documents which inform the organization’s decision making process. Priorities are formed when these documents share similar objectives. As shown in the diagram below, the City will focus on the priorities that overlap within the guiding documents.

LS360

Council Goals FY15 Priorities

Business Plan

Council Goals: The Council held a retreat to establish goals and objectives for the next year. The City Council will be updated on the progress made semi-annually and reconvene each year to reaffirm future priorities. LS360: The City of Lee’s Summit and the National League of Cities organized a community wide strategic planning process for residents to engage in visioning and planning for the Lee’s Summit community. Based on their input, goal and objectives were developed that were merged with the departmental goals and objectives. Business Plan: The City of Lee’s Summit is currently developing a 5 year internal business plan utilizing the national Baldridge program. A systematic and repeatable process was used to set the strategic direction for internal operations as well as the tactical plans to be implemented each year to ensure consistent forward progress in organizational performance.

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City of Lee’s Summit Annual Budget FY15

Citizen Based Strategic Planning in Lee’s Summit, Missouri Over the last forty years, the City of Lee’s Summit has grown into one of the largest cities in the Kansas City Metropolitan area. This growth has been effectively managed not only through the leadership provided by the Mayor and City Council, but also through the vision and goals established by the citizenbased Lee’s Summit: 21st Century strategic planning process in 1993 and later updated in 1998. Many of the things that have come to mark the high quality of life in our community and the excellence of service from the City were a result of these processes. These include new City facilities such as the police headquarters and City Hall, and new boards and commissions that help guide such community initiatives as the arts and human relations. As the goals from the 1993 and 1998 21st Century Strategic Plans have now been accomplished, the Mayor and the City Council requested that a new long-term Strategic Plan be established, which would serve as a guide for the future long-term growth and sustainability of Lee’s Summit. With facilitation from the National Civic League (NCL), a highly diverse group of individuals from around the Lee’s Summit community gathered together to formulate this plan over an 11 month period. These individuals worked together to create a plan that would serve the common good of every Lee’s Summit citizen. As the first step in this process, an Initiating Committee was assigned four primary tasks: selecting the project name, identifying potential stakeholders who would have the task of creating the strategic plan, finding a location for the meetings, and establishing organizational committees. On September 16, 2008, the Stakeholders Committee kicked off one of the largest strategic planning processes that the National Civic League has ever undertaken. This group of citizens worked together every three weeks for eight months to produce a strategic plan that would outline the needs and expectations for the Lee’s Summit community over the next 10 - 15 years. Through hours of open debate, discussion, and collaboration among stakeholders, six Key Performance Areas were identified as the main areas of emphasis for the strategic plan. The plan is divided into six key performance areas (KPA): Economic Development, Education, Health and Human Services, Local Government, Quality of Life, and Transportation. Due to the dedication and cooperation of the 202 stakeholders of Lee’s Summit 360° and their ability to maintain free and open dialog, a comprehensive long-term strategic plan was created for the common good of the community. On March 31, 2009, the entire Lee’s Summit 360° committee was able to reach a consensus on the final plan. Throughout the following summer, the City Council and the CoChairs of each KPA worked together over several City Council meetings to create the final report that serves as the long term strategic plan of the City. On August 6, 2009, the City Council unanimously approved a resolution adopting the Lee’s Summit 360°: Charting Tomorrow as the long term strategic plan for the City of Lee’s Summit.

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City of Lee’s Summit Annual Budget FY15

The final phase of the strategic planning process is underway and involves the actual implementation of the plan. The Mayor-appointed Implementation Committee is charged with reviewing the plan, further clarifying the goals and strategies and initiating the action steps. Following is a high level summary of the vision and goals established for the community through the Lee’s Summit 360 process. The full document, including strategies, action steps and success measures, may be found on the City’s website at www.cityofls.net under ‘Publications and Reports’. An online dashboard has been created to track the progress is achieving these goals.

Lee’s Summit 360 Community Vision Statement Lee’s Summit is a sustainable and vibrant city with a dynamic spirit of cooperation among its diverse citizens, businesses, organizations, educational systems and governments. Through comprehensive community planning and regional collaboration, Lee’s Summit enjoys economic independence and a high quality of life as a recognized destination city.

Key Performance Areas Education Mini Vision Statement: The community of Lee's Summit and its educational partners through regional collaboration and dynamic planning meet the life-long learning needs of all diverse citizens. Goal: Create a forum for collaboration between the City of Lee's Summit and the diverse educational partners in the community to ensure a continued, coordinated and focused emphasis regarding: Life-long learning and employment needs of the community Ongoing pursuit of funding to address such needs Attention to diversity, promotion of benefits, and understanding of education-related issues Comprehensive and coordinated dissemination of education-related information throughout the community.

Economic Development Mini-Vision Statement: Lee's Summit is a progressive destination city with a fiscally balanced tax base and a strong sense of community, which attracts and retains investment by aggressively pursuing development and redevelopment strategies through public and private partnerships Goal 1: The City of Lee’s Summit is development and redevelopment friendly. Goal 2: In order to improve the current strategy of increasing the office and industrial assessed valuations in Lee’s Summit, the City should evaluate the Lee’s Summit Economic Development Council’s (LSEDC) relationship, structure, and reporting communications with the City. Goal 3: Establish a ratio of 35% commercial and 65% residential development and redevelopment mix.

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Goal 4: Aggressively pursue redevelopment projects using the appropriate tools to achieve the highest and best use of underutilized properties. Goal 5: Lee’s Summit is perceived as a “progressive destination city”.

Health and Human Services Mini Vision Statement: Lee’s Summit is rated one of America’s healthiest cities by utilizing an integrated health and human services network providing services easily accessible to all citizens whether or not they are insured. In collaboration with its charitable organizations, the City’s health system developed the resources to assist in providing access to preventative measures, therapy, education, treatment and support to the entire community including the disadvantaged and most vulnerable. Goal 1: Identify, educate & coordinate efforts related to human service needs for the citizens of Lee's Summit. Goal 2: Involving a collaborative group of community leaders, develop a comprehensive plan to address the healthcare needs of the under-insured and uninsured of the Lee's Summit community. Goal 3: Coordinate plans and education opportunities related to the emergency services response and the health and human services aspects of disaster preparedness for the Lee's Summit community.

Local Government Mini-Vision Statement: The government of Lee's Summit reflects our strong identity while promoting a regional and collaborative approach for providing quality services with accountability to its citizens. Through transparency, communication and outreach, Lee's Summit fosters the empowerment of its citizens and a broad base of leaders. The government is guided by our sense of history, spirit of innovation and sustainability. Goal 1: Leadership development and community involvement Strategy 1: Continue to develop and expand a communication outreach program for the City of Lee’s Summit. Strategy 2: Enhance leadership training Strategy 3: Create mechanisms to maximize representative government involvement. Goal 2: Continue to support a fully-resourced, professionally trained government workforce. Strategy 1: Build the leading public safety organizations in the metropolitan area. Strategy 2: Provide modern facilities and technological tools for Staff as needed, in order to continue to maintain a high level of quality services to the Lee’s Summit community. Strategy 3: Ensure City employees are compensated competitively. Goal 3: Achieve environmentally friendly and financially sustainable infrastructure systems. Strategy 1: Create a sustainable infrastructure task force and develop a long-term infrastructure sustainability plan. Strategy 2: Promote and implement select ‘green’ initiatives. Goal 4: Promote fiscally sustainable and environmentally sensitive development.

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Strategy 1: Continue to maintain prudent cost management and conservative fiscal strategies. Strategy 2: Promote balanced revenue mix. Strategy 3: Incentivize sustainable development. Strategy 4: Protect natural resources of the community.

Quality of Life Mini Vision Statement: Acclaimed as the ideal place to live, learn, work and play, Lee’s Summit embodies healthy living, excellence in the arts, recreation, learning and multi-generational leisure opportunities combined with a respect for the environment and its diverse population. Goal 1: Establish strategies & action steps that support arts and culture in Lee’s Summit. Goal 2: Establish strategies & action steps that support a positive brand & consistent community image. Goal 3:Establish strategies & action steps that support a diverse community. Goal 4:Establish strategies & action steps that support healthy lifestyles.

Transportation Mini-Vision Statement: Transportation in Lee’s Summit is a planned, regionally integrated, multi-modal, accessible, and well-maintained system that facilitates movement about the city and encourages growth and economic development. This system includes vehicular, bicycle, pedestrian, aeronautical, rail and mass transit components that provide safe, efficient, and sustainable transportation of people, goods, and services to and from places where people live, work, worship, shop, play, learn, and seek medical care. Goal 1: Airport. Determine if expansion of the Lee’s Summit Municipal Airport (Airport) will provide desirable economic development and growth for Lee’s Summit with net positive benefits to the community overall. Goal 2: Complete Streets. A “Complete Streets” system would allow safe access along and across Lee’s Summit streets for all citizens, including motorists, bicyclists, pedestrians, and transit riders. Goal 3: Mass Transit. Provide the citizens of Lee’s Summit a safe, cost-effective, accessible, environmentally responsible regional mass transit system that connects people to work, educational institutions, medical institutions, and entertainment destinations within Lee’s Summit and with connections to other transit routes within the Kansas City metropolitan areas. This goal is to be accomplished as it is deemed feasible and fiscally sustainable for the City.

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City Council Goals

Introduction The Lee’s Summit City Council Retreat, December 14 & 16, 2012 focused on providing the Council an opportunity to identify strategic initiatives to guide the staff in the future, and to formulate a mission and vision for the City. This retreat was facilitated by Ron Holifield, CEO of Strategic Government Resources and was attended by the Mayor, all Councilmembers, City Manager, and members of the City’s management team. The Retreat Agenda was divided into six major sections including: 1. Team Dimensions Assessment to Provide Insight into Shared Decision Making Styles and Strategies for Improved Decision Making 2. Review and Discussion of Effective Governance Practices 3. Review and Discussion Regarding the Strategic Visioning Process 4. Review of Current Strategic Goals, Values, Mission and Vision 5. Deliberation and Establishment of Strategic Goals for the Future This report has been designed to generally follow in chronological order the flow of the actual retreat. The language refers to the Mayor and Council collectively as the Council.

Team Dimensions Assessment Prior to the retreat, the Mayor and City Council members took an assessment called “Team Dimensions” which is designed to assess decision making styles and assist the Council in understanding how they make decisions collectively and individually. The Team Dimensions Profile© identifies various roles that may come naturally to different people in the group. Creators – generate new ideas and fresh concepts. They prefer to live world of possibilities and look for activities that are unstructured, abstract, and imaginative. Advancers – communicate new ideas and carry them forward. They focus on the interactive world of relationships and often manage the human part of any solution.

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Refiners – analyze ideas for flaws or revise projects systematically. They focus on the objective, analytical world of facts or theories. Executors - deliver concrete results and seek successful implementations. They tend to be realists who pay attention to details and the bottom line. Flexers – have an equal preference for most or all of the roles and can often adapt their styles to fit the team’s needs. In short, the assessment suggested that a majority of the Council is weighted towards “refiners” and “creators”. Overall, many councilmembers seem to have a preference for the Refiner role. Oftentimes, groups with this pattern of results place a high value on logic and accuracy. They tend to be very reflective and perhaps even a little withdrawn or skeptical at times. This may create an environment where competency is very highly valued and people take their time to correctly resolve matters.

The Pillars of Strategic Visioning

Strategic Visioning builds upon 5 Pillars. These pillars support and give structure to both the process and the product. These include: Strategic Thinking The City Council is responsible for thinking strategically about the future and developing an inspiring vision that creates excitement and establishes the direction for the city as it moves toward the future. This is best accomplished in a retreat setting with a series of well-designed questions with professional facilitation which helps the Council engage in deep and meaningful discussions regarding the future. Business Analytics Good decisions demand good data. The more complex the issues are, and the longer term the horizon for the vision, the more critical it is to have good data to work with. Good data is not enough: the organization needs to be capable of interpreting and analyzing the data, as well as communicating it in easy to understand and compelling ways. This input includes an accurate analysis of current and anticipated trends, crucial issues, a fiscal forecast, the current comprehensive plan, and input from both staff and citizens. Planning and Execution by Staff Staff is responsible for developing and executing on action plans to achieve the Council’s vision. These plans are developed in a feedback loop with the Council, so that there is clear understanding of the Council’s vision, the mutually agreed upon goals, and the action plans to accomplish those goals.

Continual Alignment

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To translate it from dream into reality, the vision must be in alignment with the city’s purpose, its core values, and the master plan, as well as the real and perceived needs of the citizens. In turn, the goals, the objectives, and the tasks must be in alignment with the vision. Creating alignment with the annual budget and the Strategic Vision is critical to empower the city to accomplish the vision. Once alignment is achieved, leaders must be diligent to maintain alignment, including continuing adjustment of the vision based on new information, changing situations and new insights. Communication and Feedback A constant flow of communication and feedback must be maintained between Council and staff in order to maintain alignment, evaluate performance, and make necessary adjustments due to changing factors. This enables the leadership to keep the vision relevant, empowering and achievable.

Review of Current Mission, Vision, Values and Comprehensive Plan Five Overriding Principles Existing Mission, Vision, Values The Lee’s Summit City Council had not previously formulated mission, vision, or values statements. In the absence of this guidance, city staff operated by focusing on the mission and vision statements created during the LS360° Charting Tomorrow community strategic planning process. This vision statement was created by stakeholders, community leaders, residents, city council members, and city staff who participated during the 2009 planning process. The City Council reviewed and discussed the LS360° Vision Statement and generally agreed that it was a good statement. However, the consensus was that the term ‘destination city’ be replaced with ‘distinctive city’. Additionally, the City Council expressed a desire to create a vision statement that collectively expressed the vision for the City Council. LS360° Vision Statement Lee’s Summit is a sustainable and vibrant city with a dynamic spirit of cooperation among its diverse citizens, businesses, organizations, educational systems and governments. Through comprehensive community planning and regional collaboration, Lee’s Summit enjoys economic independence and a high quality of life as a recognized distinctive city. City Council Vision Statement As the elected body of the City of Lee’s Summit, Missouri, we are collectively in pursuit of; A culturally rich community with diverse economic sectors to create a prosperous and dynamic community in perpetuity.

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Strategic Goals for the Future Goals express and define future desired outcomes and are intended to guide decision making and behaviors. Goals are developed during the strategic visioning process which enables the City Council to strategically identify future direction. This continuous improvement process allows for goals to be modified, refined, and aligned to the City Council’s vision. Recommended Goals These recommendations are based upon the Effective Governance Practices Presentation, the Council’s Team Dimensions Assessment©, interviews, and council retreat discussions. 1. Determine the preference to operate in the governance model versus the political model. Council governance practices should be formally adopted that reinforce and support the type of governance culture the Council desires to establish. 2. Establish an environment that consists of healthy positive relationships to establish decorum and strengthen relationships between Councilmembers, the City Manager, and city staff through improved governance dynamics, while preserving a commitment to vigorous debate. 3. Establish clear policy expectations through an ongoing and routine strategic visioning process allowing for continuous improvement and ongoing refinement of council priorities to ensure vision alignment. 4. Develop standards for analysis and documentation that accompanies council meetings to ensure that staff presentations are aligned with Council’s vision. 5. Emphasize citizen engagement and participation from the community. 6. Educate and include new council members in past and future visioning processes. Goals developed by City Council I.

Improve the development and maintenance of infrastructure Action Steps: • • • •

II.

Explore options for how projects can be accelerated. Provide a periodic update of infrastructure improvements o Update the Thoroughfare Master Plan o Establish a communication plan for infrastructure projects Review, adopt, and implement policies that ensure the development of quality infrastructure. Expand information technology based infrastructure

Embrace a culture that promotes aggressive and bold decision making Action Steps: •

Develop an economic development strategic plan

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2: Administrative Summary •

III.

City of Lee’s Summit Annual Budget FY15

Commit to an effective governance model and continuous improvement process o Plan semiannual Council retreats and strategic visioning retreats o Communicate Council priorities and vision to stakeholders o Contextualize long term decisions that may not garner short-term political support.

Attract and retain “knowledge-based employers” Action Steps: • Establish policies, guidelines, and continually seek best practices for economic development activities. • Establish performance measures for economic development o Measure performance of these employers using the State’s ‘quality job’ definition. Measure the ability to attract these employers. • Partner with higher education institutions create to help attract “knowledge-based employers.”

IV.

Preserve and enhance residential developments Action Steps: • • •

Measure and monitor the real estate tax value of neighborhoods Provide solutions and choices to maintain and improve assessed valuation o Research and implement code enforcement programs that protect housing values Enhance role of City as a community connector

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City of Lee’s Summit Performance Excellence Balanced Dashboard The City’s Business Planning review process is conducted on an ongoing basis, both with the employee teams and weekly during Management Team meetings. It follows a systematic process where organizational measures in the balanced scorecard are reviewed as well as the measures reflecting performance against action plans.

Goal

Objective

Customer Focus

Customer Focus

Delivery of Services

Strategy

Strategy Measure

Measure Definition

Ensure customer Understand the engagement elements of an engaged customer and develop an approach to ensure customer engagement. Maximize Identify customer customer satisfaction demographics and determine approach to maintaining relationships

Customer Engagement Plan Developed

1) Action Plan Implemented 2) Increase in Customer Engagement Score

Customer relationship approach developed

Action Plan Completed

Utilize technology to facilitate the optimum delivery of services

Approach to ensure information accuracy, accessibility, reliability, and security developed and implemented.

1) Action Plan Implemented 2) Increase in customer perception of data accuracy

Develop and implement a systematic approach to insure information (data) accuracy accessibility, reliability, and security.

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary Delivery of Services

Ensure a systems- based process to organizational management and planning

Delivery of Services

Ensure City infrastructure supports and facilitates the delivery of service to customers Objective

Goal

Create policy alignment; political/ organizational/ community. (Lack of communication and collaboration) Develop and implement a systematic life cycle approach to sustainable infrastructure

Policy alignment Action Plan achieved. Completed

Life cycle approach implemented

Action Plan Completed.

Strategy

Strategy Measure

Measure Definition

Delivery of Services

Ensure delivery of the right services at the right time to customers

Develop and implement a systematic approach to ensure customer requirements are built into the development of all products, programs, and services

Approach to ensure customer requirements are built into the development of all services implemented

1) Action Plan Completed. 2) Increase in customer satisfaction with services.

Communication

Maximize employee effectiveness through internal communication

Review of existing internal data and distribution methods

Action Plan Completed

Communication

Maximize employee effectiveness through internal communication

Develop and implement standardized approach to internal communications

Review of existing internal data and distribution methods completed. Internal standardized approach developed and implemented

Communication

Ensure effective stakeholder and citizen satisfaction through external communication

Develop and implement standardized approach to external communications

External standardized approach developed and implemented

1) Action Plan Implemented 2) Increase in satisfaction with external communication

1) Action Plan Implemented 2) Increase in satisfaction with internal communication

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary Communication

Ensure effective stakeholder and citizen satisfaction through external communication

Develop and implement information guide for new customers

Information guide developed and implemented

Workforce

Employee Satisfaction and Engagement

Develop and implement systematic process to collect employee ideas and opinions.

Feedback loop process developed and implemented

1) Action Plan Implemented 2) Increase in satisfaction with communication with new customers 1) Action Plan Implemented 2) % employees engaged

Goal

Objective

Strategy

Strategy Measure

Measure Definition

Workforce

Proactively manage workforce capacity

Communication process developed and implemented

1) Plan Completed 2)Improvement in % Commitments Kept

Pilot Employee development plan developed and implemented

1) Plan Completed 2)Employee Satisfaction

Technology project plan developed

Plan Completed

Economic Plan developed

1) Action Plan developed 2) Effectiveness of economic plan

Workforce

Workforce

Fiscal Accountability

Develop and implement systematic process to improve communication between Management, Council & Community Group (Implement pilot group) Proactively Develop and manage implement plan workforce to foster capability development of employees – (PILOT PLAN in IT Dept.) Foster employee Develop technological systematic self-sufficiency technology project plan (year two) Ensure financial Develop and resources are implement available to strategic meet strategic economic and daily development operational plan needs effectively and efficiently

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City of Lee’s Summit Annual Budget FY15

2: Administrative Summary Fiscal Accountability

Fiscal Accountability

Ensure financial resources are available to meet strategic and daily operational needs effectively and efficiently Ensure financial resources are available to meet strategic and daily operational needs effectively and efficiently

Maintain and develop strong fiscal policies to ensure longterm financial health of the City

Fiscal policies developed and implemented

Action Plan Completed

Promote an understanding of the financial ability of the City to meet stakeholder expectations

Increase in stakeholder satisfaction with financial tools

1) Action Plan Completed. 2) Stakeholder satisfaction with financial tools

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3: Budget Overview

Fund Structure The City budget is divided into 70 different funds which fall into one of two major categories: Governmental Fund Types Governmental Funds are those which rely on taxes for support. The taxes are deposited into the revenue accounts of the General Fund, Special Revenue Funds, Debt Service Funds and Capital Projects Funds. Proprietary Fund Types Proprietary Funds rely on user charges for support and include the Enterprise Funds, which provide services to and collect fees from the general public. The Internal Service Funds provide service to and collect fees from the General Operating Fund, Special Revenue Funds, and Enterprise Funds that are directly benefited. Governmental Fund Types General

General

Special Revenue

Parks & Recreation Fund Gamber Center Legacy Park Community Ctr Summit Waves Cemetery Trust Fund Business & Industry Fund Entitlement Fund VAWA Grant Fund Public Safety Equipment Replacement Fund

Debt Service

GO Debt Park COP Debt

Proprietary Fund Types Capital Project

SummitWoods East TIF Hartley's Block TIF I470 Business Center TIF Chapel Ridge TIF Longview TIF Longview TDD Ritter Plaza TIF Todd George/50 Hwy TIF Water Tap Fund Sewer Tap Fund Water Construction Sewer Construction WU Equipment Replacement Fund ERP System Airport Construction Fund Capital Improvement Sales Tax R&B Improvement Fund Park Development Fund Neighborhood Park Renovations Water/Sewer Bonds Public Safety 2010 Cultural Arts 2013 Bonds Road Improvments 2013 Bonds

Enterprise

Water/Sewer Fund Airport Fund Solid Waste Management Fund Harris Park Recreation Center

Internal Service

Central Building Services Fleet Operations ITS Services ST Disability Fund Unemployment Trust Fund Insurance Trust Fund Work Comp Self Insurance

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

Review of Funds The following table lists the estimated beginning fund balance or retained earnings; projected revenues; and expenditures (including interfund transfers) and the projected ending fund balance for all City funds. Unaudited Balance 6/30/2014 GOVERNMENTAL FUNDS General Fund Total Governmental Funds

14,809,025 14,809,025

Add Revenues

Less Expenditures

58,984,132 58,984,132

60,445,927 60,445,927

Projected Balance 6/30/2015 13,347,230 13,347,230

Net Change Amount Percent (1,461,795) (1,461,795)

-9.9% -9.9%

SPECIAL REVENUE FUNDS Energy Efficiency & Conservation Block Grant Gamber Center Legacy Park Community Center Parks & Recreation Fund Summit Waves Aquatics Business and Industry CDBG Entitlement Cemetery Trust Fund Summit Woods TDD Longview TDD Violence Against Women Grant Fund Public Safety Equipment Replacement Postclosure Trust Fund Total Special Revenue Funds

(13,374) 269,667 547,250 1,556,225 (20,748) 46,675 (32,506) 1,158,300 1,313 151 193,826 17,489 4,360,228 8,084,496

634,802 1,858,067 3,249,303 669,765 328,843 298,901 273,956 20,300 207,561 69,630 7,611,128

635,077 2,037,978 3,373,659 668,410 328,502 298,091 274,667 23,000 175,778 37,905 7,853,067

(13,374) 269,392 367,339 1,431,869 (19,393) 47,016 (31,696) 1,157,589 (1,387) 151 225,609 49,214 4,360,228 7,842,557

(275) (179,911) (124,356) 1,355 341 810 (711) (2,700) 31,783 31,725 (241,939)

0.0% -0.1% -32.9% -8.0% -6.5% 0.7% -2.5% -0.1% -205.6% 0.0% 16.4% 181.4% 0.0% -3.0%

DEBT SERVICE FUNDS G.O. Debt Service Fund Park Certificate of Participation Debt Fund Total Debt Service Fund

6,574,887 2,379,726 8,954,614

8,233,772 3,219,067 11,452,839

8,293,000 3,642,213 11,935,213

6,515,659 1,956,580 8,472,240

(59,228) (423,146) (482,374)

-0.9% -17.8% -5.4%

CAPITAL PROJECT FUNDS Summitwoods East TIF Hartley Block (TIF) I-470 Business Center TIF Capital Improvements Sales Tax Chapel Ridge TIF Longview TIF Airport Improvement Water Tap Fund Sewer Tap Fund Water Construction Sewer Construction Water/Sewer Equipment Replacement Road & Bridge Improvement Ritter Plaza TIF Todd George/50 Hwy TIF Road & Bridge Excise/Sales Tax Neighborhood Park Development Public Safety 2010 Road Improvement 2010 Cultrual Arts 2013 Road Improvements 2013 Total Capital Project Funds

3,424,522 215,408 153,698 24,712,727 (2,333,414) (7,843) 1,975,463 (6,634,329) 546,110 8,001,729 61,848 3,003,785 6,478,087 39,377 1,494,164 (120,279) 1,039,746 6,963,353 2,455,621 2,745,476 4,393,324 69,820,420

2,490,441 43,172 386,211 6,739,572 2,028,959 334,580 2,794,561 100,665 4,925,000 2,125,000 681,884 6,542,754 90,593 988,678 591,336 750,000 31,613,406

2,451,697 43,864 610,000 1,213,000 2,050,857 331,480 425,000 8,889,535 1,579,503 2,400,000 1,400,000 1,042,000 8,046,000 62,202 7,073,505 375,000 246,000 356,000 2,388,000 2,405,000 43,388,643

3,463,266 214,716 (70,091) 30,239,299 (2,355,312) (4,743) 1,550,463 (12,729,303) (932,728) 10,526,729 786,848 2,643,669 4,974,841 67,768 (4,590,663) 471,057 1,414,746 6,717,353 2,099,621 357,476 1,988,324 58,045,183

ENTERPRISE FUNDS Harris Park Community Center Airport Operating Water Utility Operating Solid Waste Management Total Enterprise Funds

260,584 17,271,997 11,985,518 2,650,933 38,013,266

1,271,207 5,539,193 43,953,382 2,963,393 53,727,175

1,203,339 4,732,366 39,000,851 3,038,106 47,974,662

328,452 18,078,824 16,938,049 2,576,220 43,765,779

67,868 806,827 4,952,531 (74,713) 5,752,513

26.0% 4.7% 41.3% -2.8% 15.1%

INTERNAL SERVICE FUNDS Short-Term Disability Trust Unemployment Trust Claims & Damages Reserve Fund Workers Compensation Self-Insurance Central Building Services Fleet Operations Information Technology Systems Total Internal Service Funds

91,479 104,134 48,734 1,001,557 1,968,558 11,849,970 2,755,372 17,857,429

38,843 26,306 150,433 898,929 1,369,287 3,062,237 2,911,114 8,457,149

32,954 33,931 150,000 906,418 1,274,808 5,379,697 3,934,140 11,711,948

97,368 96,509 49,167 994,068 2,063,037 9,532,510 1,732,346 14,602,630

5,889 (7,625) 433 (7,489) 94,479 (2,317,460) (1,023,026) (3,254,799)

6.4% -7.3% 0.9% -0.7% 4.8% -19.6% -37.1% -18.2%

157,539,249

171,845,829

183,309,460

146,075,618

(11,463,631)

-7.3%

Grand Total

38,744 (692) (223,789) 5,526,572 (21,898) 3,100 (425,000) (6,094,974) (1,478,838) 2,525,000 725,000 (360,116) (1,503,246) 28,391 (6,084,827) 591,336 375,000 (246,000) (356,000) (2,388,000) (2,405,000) (11,775,237)

1.1% -0.3% -145.6% 22.4% 0.9% -39.5% -21.5% 91.9% -270.8% 31.6% 1172.2% -12.0% -23.2% 72.1% -407.2% -491.6% 36.1% -3.5% -14.5% -87.0% -54.7% -16.9%

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

Combined Revenues by Type General

Special Revenue

Debt Service

Property taxes $ Sales tax Franchise tax Motor vehicle taxes Bed tax Other taxes Fines and forfeitures Licenses and permits Intergovernmental Charges for services Material and fuel sales Investment earnings Other Sale of property Bond Proceeds Interdepartment revenues Transfers in

17,929,506 13,478,056 13,978,424 3,189,933 312,041 1,328,566 1,568,441 755,470 3,633,578 79,405 1,664,410 1,066,302

$ 3,017,000 328,504 1,000 20,250 507,212 2,919,028 183,058 13,639 135,523 99,000 386,915

$

8,033,772 3,216,567 40,000 162,500 -

$

58,984,132

$ 7,611,129

$ 11,452,839

Capital Projects $

4,504,612 14,618,192 -

Internal Service

Enterprise $

$

Total

478,054 14,873 612,232 986,365 2,082 10,396,995

290,458 3,801,000 36,374,831 1,059,352 63,931 344,702 10,900,000 892,901

41,199 750 609,878 7,792,852 12,470

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

33,484,890 31,312,815 13,978,424 3,189,933 328,504 791,095 1,694,147 1,568,441 5,675,914 43,913,802 1,242,409 362,756 2,145,385 708,878 10,900,000 7,792,852 12,755,583

$ 31,613,405

$ 53,727,175

$ 8,457,149

$ 171,845,828

Enterprise

Internal Service

Total

Combined Expenses by Type General

Special Revenue

Debt Service

Personal services $ Supplies for resale Other supplies & services Repairs and maintenance Utilities Fuel and lubricants Depreciation Miscellaneous Interest Debt service Capital outlay Construction Interdepartment charges Transfers out

42,460,090 137,980 7,923,079 1,301,073 1,723,693 692,853 129,680 5,413,811 663,668

$ 3,761,930 1,988,710 552,580 389,817 58,475 62,215 500 605,953 108,727 261,914 62,246

$

143,000 2,037,213 8,830,000 925,000

$

60,445,927

$ 7,853,067

$ 11,935,213

Capital Projects $

6,553,604 36,299,000 536,038

$ 43,388,642

$

5,958,842 15,160,112 4,144,600 683,711 765,459 367,122 5,179,912 47,737 1,269,463 121,887 952,938 13,322,881

$ 3,148,477 1,793,963 428,743 289,778 12,223 2,185,268 3,287,396 86,185 479,915 -

$ $ $ $ $ $ $ $ $ $ $ $ $ $

$ 47,974,663

$ 11,711,948

$ 183,309,462

55,329,339 15,298,092 22,546,956 2,966,107 3,168,747 1,130,672 7,365,180 239,633 3,307,176 8,830,000 4,015,236 36,493,912 7,108,578 15,509,833

Transfers Out: Includes payments for expansion items, appropriations for the Arts Council, Beautification th Commission, and 4 of July event expenses.

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

CHANGES IN FUND BALANCES Lee's Summit, Missouri Combining Funds Statement By Fund Types For Fiscal Year 2015 Debt Service

Special Revenue

General Est. Beginning Balance $

14,809,025

Revenues Transfers In

57,917,830 1,066,302

$ 8,084,496

$

8,954,614

Capital Projects

Enterprise

Internal Service

Total

$ 69,820,420

$ 38,013,266

$ 17,857,429

$ 157,539,249

7,224,213 386,915

11,452,839 0

21,216,411 10,396,995

52,834,274 892,901

8,444,679 12,470

159,090,246 12,755,583

Total Resources

73,793,157

15,695,624

20,407,453

101,433,826

91,740,441

26,314,578

329,385,078

Less: Expenditures Transfers out

59,782,259 663,668

7,790,821 62,246

11,010,213 925,000

42,852,605 536,038

34,651,781 13,322,881

11,711,948 0

167,799,627 15,509,833

Ending Balance $ Fund Balance Change: Amount Percent

13,347,230

($1,461,795) -9.9%

$ 7,842,557

($241,939) -3.0%

$

8,472,240

($482,374) -5.4%

$ 58,045,183

($11,775,237) -16.9%

$ 43,765,779

$5,752,513 15.1%

$ 14,602,630

($3,254,799) -18.2%

$ 146,075,618

($11,463,631) -7.3%

Fund and Department organization The General Fund: This fund includes budgets for 10 departments that provide the mission critical services to our residents, such as police and fire protection, street maintenance, planning, codes, court, and general administration of the City. Special Revenue Funds: Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than expendable trust or major capital project) requiring separate accounting because of legal or regulatory provisions or administrative action. This includes the Parks, grants, business and industry, tax increment financing (TIF), and transportation development district (TDD) funds. Debt Service Funds: The city utilizes two funds to record the receipt and disbursement of monies used to repay principal and interest charges on city issued debt. The General Obligation Debt Service Fund and Park COP Debt Service Fund are used to account for the annual retirement of bonds issued from 2003 through 2014. Capital Project Funds: The capital improvement funds include budgets that allocate expenses for infrastructure improvements. The City’s capital projects are funded by a variety of different sources. The City’s road and bridge maintenance projects and capital improvements are funded by a ½ sales tax. Other projects are funded by tax increment financing and through the sale of general obligation bonds. Enterprise Funds: The City’s enterprise funds hold the budgets for departments that operate in business-type activities. These funds rely on revenues generated from sales of materials or services. The enterprise funds include budgets for our Water Utilities, Solid Waste, and Airport activities.

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

Internal Service Funds: The City uses internal service funds, or Proprietary Funds, to account for its fleet of vehicles and equipment, information technology systems, central building services, and trust funds. The internal service departments allocate costs for the reimbursement of services to other departments. General Fund Departments Department Administration PW Engineering Police Fire Finance Law Planning Court PW Operations Codes Development Center Total

Department Water Utilities Airport Solid Waste (Landfill) Harris Park Community Ctr Total

FY14 Budget 3,452,683 3,772,615 19,043,674 15,473,009 5,129,725 1,130,872 974,475 815,560 7,149,928 1,450,682 0 58,393,223

FY15 Requested 3,609,723 3,842,083 19,245,826 15,543,898 6,092,469 1,258,971 795,735 800,607 7,079,262 1,198,238 979,114 60,445,926

Change from FY14 Budget $ 157,040 69,468 202,152 70,889 962,744 128,099 -178,740 -14,953 -70,666 -252,444 979,114 2,052,703

% 4.5% 1.8% 1.1% 0.5% 18.8% 11.3% -18.3% -1.8% -1.0% -17.4% n/a 3.5%

Enterprise Fund Departments Change from FY14 Budget FY14 FY15 $ % Budget Requested 32,734,792 39,000,851 6,266,059 19.1% 6,185,151 4,732,366 -1,452,785 -23.5% 2,984,830 3,038,106 53,276 1.8% 1,178,688 1,203,339 24,651 2.1% 43,083,461 47,974,662 4,891,201 11.4%

Special Revenue Fund Departments Change from FY14 Budget FY14 FY15 Department $ % Budget Requested Parks and Recreation 3,394,562 3,373,659 -20,903 -0.6% Gamber Center 548,973 635,077 86,104 15.7% Legacy Park Community Ctr 1,839,133 2,037,978 198,845 10.8% Summit Waves (Aquatics) 636,735 668,410 31,675 5.0% Cemetery 282,074 274,667 -7,407 -2.6% Total 6,419,403 6,715,124 288,314 4.5% Internal Service Fund Departments Change from FY14 Budget FY14 FY15 Department $ % Budget Requested Central Building Srv 1,299,233 1,274,808 -24,425 -1.9% Central Vehicle (Fleet) 5,191,510 5,379,697 188,187 3.6% Information Technology (ITS) 3,554,883 3,934,140 379,257 10.7% Total 10,045,626 10,588,645 543,019 5.4%

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

Budget Committee Recommendation The Budget Committee proposed to the City Council changes to the City Manager’s requested budget. The items listed in red were amended from the original budget outlined in the City Manager’s Budget Message.

City Manager's Proposed Budget with Recommendations General Fund 2 Year Plan

Operating Budget Beginning Projected Revenues: Beginning Projected Expenses:

2. Community Marketing Program

FY15 Request 58,924,132 60,554,901 Expenditure Additions: 126,000

Significant Expenditure Reduction Proposals: 2. Support to Public Service Agencies -48,000 13. Adjustment from 2% to 1% merit pool -400,049

FY16 Projected 59,493,559 61,854,542

125,000 -62,000

Operating Budget (with proposals) Total Revenues Total Expenses Net Income:

58,984,132 59,745,927 -761,795

Reserve (Fund Balance) Spending Proposals: 1. Retirement Maximization Program Expense 700,000 Sum: 700,000

60,399,673 60,399,672 0

0 0

Total Proposed Total Revenues

58,984,132

60,399,673

Total Expenses (with one-time) Net Income:

60,445,927 -1,461,795

60,399,672 0

Summary of Significant Changes: • •

Reduction of the performance based merit pool from 2% to 1% (All Funds) A reallocation of funding from the new community marketing program was proposed to reduce the reduction to Public Service Agencies (Chamber of Commerce, Downtown Lee’s Summit Main Street, and Economic Development Council): $14k.

These changes result in a total appropriation of $183,309,460 for the fiscal year ending June 30, 2015. A summary of these changes can be found in Section 5: General Fund Overview.

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview Full Time Equivalents (FTE)

FTE’s are positions or employees that are expressed as a ratio of hours worked. One FTE is assumed to work 2,080 hours per year. For Firefighters, 1 FTE is assumed to work 2,912 hours per year. The table below lists all approved FTEs for FY15. Example FTE Calculation: Position Hours Worked Hours Available Management Analyst 1500 ÷ 2080 =

Fund General Fund Parks & Recreation Water Utilities Airport Solid Waste CBS Fleet ITS Total

Full Time Equivalents (FTE) FY13 FY14 FY15 545.26 531.24 528.74 116.98 116.18 113.95 59.98 59.98 59.5 7.04 6.3 6.22 15.15 14.8 14.8 8.75 8.75 8.62 9 9 9.12 26.23 26.23 25.89 788.39 772.48 766.84

FTE 0.72

Change from FY14 $ % -2.5 -0.5% -2.23 -1.9% -0.48 -0.8% -0.08 -1.3% 0 0.0% -0.13 -1.5% 0.12 1.3% -0.34 -1.3% -5.64 -0.7%

A summary of variances can be found in the general fund overview section on page 87 and the individual department summaries. 900 800

788

772

767

ITS

700

Fleet

600

CBS

500

Solid Waste

400 300

Airport 545.26

531.24

528.74

Water Utilities

200

Parks & Recreation

100

General Fund

0 FY13

FY14

FY15

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview Key Financial Trends

The City’s Budget Committee is updated monthly regarding the City’s financial condition and financial trends. In addition to the monthly information, the Budget Committee reviews key trends when presented midyear projections and budget estimates. In FY15, the City’s major sources showed marginal growth following rapid development that started early in 2000 and slowed during the most recent recession. New growth of approximately 2.5% is expected to occur over the next five year period.

Major Revenues 'Reoccuring Revenue'

20,000 18,000

Thousands

16,000 14,000

Net Sales

12,000

Property Tax

10,000

Franchise Tax

8,000

Motor Vehicle Tax

6,000 4,000 2,000 FY10 FY11 FY12 FY13 FY14 FY14 FY15 FY16 FY17 FY18 FY19

In addition to revenue analysis, key expenditure trends are presented for Budget Committee review. The largest category of expenditures, excluding capital costs, is for personnel. An important trend the City is monitoring is the increase in health insurance costs. Health insurance is growing faster than any other operating cost. General Fund Revenues and Expenditures Projected

$80

13.09% 13.27% 13.47%

$70

Millions

$60 $50 $40

16.00% 13.68%

7.82%

8.30%

8.99%

9.39%

10.25% 11.01%

11.79%

14.00% 12.00%

12.40%

10.00% 8.00%

$30

6.00%

$20

4.00%

$10

2.00%

$FY09

FY10

FY11

FY12

FY13

FY14

FY15 Budget

FY16

FY17

FY18

FY19

FY20

0.00%

Total revenues Expenditures w/o one time

Fiscal Year

Personnel Costs Health Insurance as a % of Personnel Costs

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

As outlined in the City Manager’s Budget message, the general fund continues to be financially constrained as trends indicate expenditures growing faster than revenues. The City Manager has outlined a two year plan that will help correct this issue.

General Fund Revenues and Expenditures $80 Projected

$75

Millions

$70 $65 $60 $55 $50 $45

Total revenues Total expenditures

$40 FY09

FY10

FY11

FY12

FY13

FY14

FY15 FY16 Budget

FY17

FY18

FY19

FY20

Fiscal Year

Additional trend information can be found throughout this document as it pertains to revenues, internal service and enterprise funds.

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City of Lee’s Summit Annual Budget FY15

The FY15 Adopted Budget, as outlined in the ordinance, followed recommendations from the Budget Committee. For more information about these recommendations please see the General Fund Overview Section.

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City of Lee’s Summit Annual Budget FY15

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City of Lee’s Summit Annual Budget FY15

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City of Lee’s Summit Annual Budget FY15

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City of Lee’s Summit Annual Budget FY15

3: Budget Overview

Organizational Policies and Procedures Summary of Significant Accounting Policies The City of Lee’s Summit, Missouri (the City) was incorporated in 1868 and covers an area of approximately 64 square miles in Jackson and Cass Counties, Missouri. Lee’s Summit is a charter city operating under an elected Mayor-City Council form of government. The City Administrator is the chief administrative officer of the City. The City provides services to more than 70,000 residents in many areas including law enforcement, fire protection, water and sewer services, community enrichment and development, and various social services. Educational services are provided by separate governmental entities. The accounting and reporting policies of the City conform to generally accepted accounting principles (GAAP) applicable to local governments. The following represent the more significant accounting and reporting policies and practices of the City. The Financial Reporting Entity The City is governed by an elected eight-member council and a mayor. As required by GAAP, these financial statements present the City of Lee’s Summit (the primary government). The following component unit is included in the City’s reporting entity because of the significance of its operational and financial relationship with the City. Blended Component Unit The following legally separate entity is a component unit which is, in substance, a part of the City’s general operations. This component unit provides services almost entirely to the primary government and provides services which almost exclusively benefit the primary government. Data from this unit is combined with data of the primary government for financial reporting purposes. The Lee’s Summit, Missouri Municipal Building Authority (the Authority) is a not-for-profit corporation incorporated under the laws of the state of Missouri on August 13, 1994. The Authority is governed by a three-member board appointed by the City Council. The Authority was established to promote, acquire, develop, construct, own and lease facilities within the City which are approved by the City Council for the purpose of promoting the economic, social, industrial, cultural and commercial growth and for the general benefit of the City and its residents. Administration of its various programs is performed by City employees. Although it is legally separate from the City, the Authority is reported as if it were part of the primary government because its sole purpose is to finance and construct the City’s public buildings. Separate financial statements for the Authority are not prepared. Basis of Presentation The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, equities, revenues and expenditures or

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expenses. The various funds are grouped by type in the general purpose financial statements. The following fund types and account groups are used by the City. Governmental Fund Types The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than expendable trust or major capital projects) requiring separate accounting because of legal or regulatory provisions or administrative action. The Debt Service Fund is used to account for the accumulation of resources for, and the payment of, principal, interest and fiscal charges on long-term obligations other than obligations payable from the operations of Proprietary Fund Types. Capital Project Funds are used to account for financial resources segregated for the acquisition or construction of major capital facilities other than those financed by Proprietary Fund Types or Expendable Trust Funds. Proprietary Fund Types Enterprise Funds are used to account for operations which provide a service to the general public and are financed primarily by user charges from such services. Internal Service Funds are used to account for the financing of goods or services provided by one department to other departments of the City on a cost-reimbursement basis. Fiduciary Fund Types Expendable Trust Funds are used to account for assets held in trust by the City for others. The City’s Expendable Trust Funds include the Entitlement Fund. Account Groups The General Fixed Assets Account Group is established to account for all fixed assets of the City other than those accounted for in the Proprietary Fund Types. Construction in progress, which recognizes the value of assets not completed, is also included in this fund. The General Long-Term Debt Account Group is established to account for all long-term indebtedness of the City except that accounted for in the Proprietary Fund Types. Basis of Accounting The accounting and financial reporting applied to a fund is determined by its measurement focus. All Governmental Fund Types and Expendable Trust Funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e.,

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City of Lee’s Summit Annual Budget FY15

revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. The modified accrual basis of accounting is used by all Governmental Fund Types, Expendable Trust Funds and Agency Funds. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become measurable and available). “Measurable” means the amount of the transaction can be determined, and “available” means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The City considers property taxes as available if they are collected within 60 days after year-end. A one-year availability period is used for revenue recognition for all other Governmental Fund revenues. Expenditures are recorded when the related fund liability is incurred. Principal and interest on general long-term debt are recorded as fund liabilities when due or when amounts have been accumulated in the Debt Service Fund for payments to be made early in the following year. Those revenues susceptible to accrual are property taxes, franchise taxes and interest. Sales taxes collected and held by the state at year-end on behalf of the City also are recognized as revenue. Fines, licenses and permits are not susceptible to accrual because, generally, they are not measurable until received in cash. All Proprietary Fund Types are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and all liabilities associated with the operation of these funds are included on the balance sheet. Fund equity (i.e., net total assets) is segregated into contributed capital and retained earnings components. Proprietary Fund Type operating statements present increases (e.g., revenues, non-operating revenues and operating transfers in) and decreases (e.g., expenses, nonoperating expenses and operating transfers out) in net total assets. The accrual basis of accounting is utilized by the Proprietary Fund Types. Under this method, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred. The City does not apply Financial Accounting Standards Board (FASB) statements issued after November 30, 1989 for its Proprietary Funds. Cash Equivalents Cash equivalents include investments with original maturities of less than three months. Other Taxes and Revenues Recognized state shared taxes, such as motor, gas and liquor taxes, represent payments received during the current fiscal period. Federal and state grant aid is reported as revenue when the related reimbursable expenditures are incurred. Unrestricted aid is reported as revenue in the fiscal year the entitlement is received. Charges for services are generally susceptible to accrual and are recorded as revenue when earned.

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Licenses, fees, fines, forfeitures and other revenues are generally not susceptible to accrual and are recorded when received in cash. Inventories Inventories, which primarily consist of water line maintenance materials, are valued at cost using the first-in, first-out (FIFO) method. The costs of Governmental Fund Type inventories are recorded as expenditures when consumed rather than when purchased. Prepaid Insurance Prepaid insurance represents the payment of insurance premiums for coverage that benefits more than one fiscal period. The premium amounts are amortized over the policy periods. Deferred Bond Issue Costs and Unamortized Bond Discount Deferred bond issue costs and unamortized bond discount are amortized over the life of the debt using the effective interest method. Property, Plant and Equipment Property, plant and equipment owned by the Proprietary Fund Types are stated at actual or estimated historical cost, less accumulated depreciation. Contributed assets are recorded at estimated fair market value at the time received. Assets acquired through capital leases are recorded in the appropriate property, plant and equipment accounts and are depreciated over their estimated useful lives. Amortization of assets recorded under capital leases is included within Proprietary Fund Type depreciation expense. Depreciation of plant and equipment is provided on the straight-line basis over the estimated useful lives of the respective assets as follows:

Buildings

20–40 years

Plant and water/sewerage systems

35–75 years

Machinery and equipment

3–15 years

It is general practice to charge maintenance and repairs to expenses. Major expenditures for renewals and betterments are capitalized and depreciated over their estimated useful lives. Cost of assets sold or retired and the related amounts of accumulated depreciation are eliminated from the accounts in the year of sale or retirements, and any resulting gain or loss is reflected in the general purpose financial statements. General Fixed Assets General fixed assets have been acquired for general governmental purposes. Assets purchased are recorded as expenditures in the Governmental Fund Types and capitalized at actual or estimated

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historical cost in the General Fixed Assets Account Group. In the case of gifts or contributions, such assets are recorded in General Fixed Assets Account Group at fair market value when received. Certain improvements, including roads, bridges, curbs and gutters, streets and sidewalks, drainage systems and lighting systems, have not been capitalized. No depreciation is provided on general fixed assets. Interest Expenditures Expenditures for interest on general long-term debt are accounted for in the year of payment. Compensated Absences Under the terms of the City’s personnel policy, City employees are granted vacation and sick leave in varying amounts. In the event of termination, an employee is paid for accumulated vacation days up to the equivalent of two years’ vacation (maximum of six weeks). Employees are paid for one-eighth of accumulated sick leave upon termination if they have five or more years of employment with the City. All employer related costs of vacation and sick leave are accrued and recorded when earned. Only the current portion of accrued vacation and sick leave is recorded in the Governmental Fund Types, and the remainder of the liability is reported in the General Long-Term Debt Account Group. All employer related costs of accrued vacation and sick leave in the Proprietary Fund Types is recorded entirely within those funds. Budgetary Procedures The reported budgetary data represents the final approved budget after amendments as adopted by the City Council. Amendments to the original budget were not material, and appropriations lapse at yearend. The basis of accounting is the same for both budgeting and GAAP reporting purposes. The City Council utilizes the following procedures in establishing the budgetary data reflected in the general purpose financial statements. (1) Prior to the beginning of the fiscal year, the City Administrator submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1. The operating budget provides a complete financial plan of all funds and activities for the upcoming fiscal year. In no event shall the total proposed expenditures exceed the estimated revenues to be received plus any unencumbered cash reserves estimated to be on hand at the beginning of the budget year. (2) Public hearings are conducted to obtain taxpayer comments. (3) Prior to July 1, the budget is legally enacted through passage of an ordinance. The appropriated budget is prepared by fund, department and program. Department heads may make transfers of appropriations within their departments. Upon written request by the City Administrator, the Council may, by ordinance, transfer part or all of any unencumbered appropriation balance from one department to another. The legal level of budgetary control is the department level.

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Although the City is legally required to prepare budgets for all funds, there is no legal requirement to report on those budgets. Therefore, the Combined Statement of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual presents a comparison of budget and actual for only the General Fund, Special Revenue Funds, Debt Service Fund and the Expendable Trust Fund. All special revenue funds have annual appropriated budgets except for the Federal Emergency Management Measures Fund (FEMA). The FEMA Fund is activated only when the City is declared a state or federal disaster area. Capital projects are budgeted on a project basis rather than on an annual fiscal basis; therefore, a comparison of actual to budget for Capital Project Funds would not be meaningful

Budget Adoption and Administration The following procedures will be followed in the preparation, adoption, administration, and control of departmental budgets within city organizations. Preparation The following fund types shall be budgeted:

• • • • • •

General Operating Special Revenue Debt Service Capital Projects Enterprise Internal Service

Prior to the preparation of departmental budget requests, the City Manager and Department Directors shall meet with the City Council to discuss priorities for the coming fiscal year. The priorities shall be the basis for which the Department Directors then prepare individual Program Budget requests for the upcoming year. The City Manager and Department Directors will meet to present and discuss their respective budget requests at least two months prior to the beginning of the new fiscal year. They will make adjustments as necessary to meet the overall budget goals and funding levels of the City. Budget Adoption The City Manager and Department Directors will submit their combined budget proposal to the Budget Committee one month prior to adoption. The Mayor and City Council will review the proposed budget draft during the Work Session preceding the meeting of adoption. The City Council shall publish in one or more newspapers in the City a general summary of the budget and a notice stating: 1) the times and places where copies of the message and budget are available for

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inspections by the general public; and 2) the time and place, not less than two weeks after such publication, for a public hearing on the budget. Adoption of the budget will be by passage of the budget ordinance by the City Council and approval by the Mayor, as provided by law. The budget shall provide a complete financial plan of all city funds and activities for the ensuing fiscal year and, except as required by law or this Charter, shall be in such form as the City Manager deems desirable or the Council may require. The budget must be balanced, in which expenses do not exceed revenues. In no event shall the total proposed expenditures exceed the estimated revenues to be received plus any unencumbered cash reserves estimated to be on hand at the beginning of the budget year. Expense categories for the City of Lee’s Summit include:

• Personal Services: Control of expenditures in the area of personal services is provided through position control. No new positions may be created without the approval of the City Manager, Mayor, and City Council. • Commodities: The Commodities category shall include uniforms that are purchased, office equipment and furniture, small tools, janitorial, fuel and lube and other items consumed in performing the function of the department. • Contractual Services: Contractual Services are professional fees such as organizational memberships, legal fees, auditing, testing, service and equipment rentals, and maintenance and repair expenses incurred in the routine operation of the department. • Maintenance & Repairs: The Maintenance & Repairs category is for buildings, vehicles and equipment used in the delivery of service by the department. This also includes the Internal Services overhead charge. • Utilities: Utilities expenditures are those incurred for gas, electric, phone, cell phones, water and sewer. • Fuel & Lubricants: These are the petroleum expenditures incurred for motorized equipment and vehicles. • Depreciation: The periodic expense of assets based on value and estimated life of the capital assets. • Debt Service: This is the principal, interest and fiscal agent expenditures relating to general obligation, revenue bonds, and certificates of participation as well as any lease purchase type debt instruments. • Interfund Transfers: Interfund transfers are used to provide resources on a program basis while still maintaining fiscal integrity by fund source and type. • Capital Outlay: Capital Outlays are expenditures incurred through the acquisition or enhancement of capital assets, to the extent the expenditure exceeds $5,000 and has a

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useful life or can be expected to extend the life two years or more. A more detailed explanation of this account may be found in the City's Capital Asset Policy. Administration No Capital Expenditure will be made unless:

• It was specifically budgeted for in the adopted budget, or the Assistant to the City Manager determines that there are funds available in the department's budget, and the City Manager approves the purchase in writing. • The City Council upon recommendation of the appropriate standing committees shall authorize the unbudgeted expenditure if it exceeds $10,000 to the extent that the reappropriation of funds does not diminish the overall goal and objectives of the departments program for which these funds are taken. The request for such approval shall be highlighted on the Council's Regular Agenda, and backup material provided which explains the purpose of the change and its impact on budget priorities. The City Manager shall approve all transfers of funds between line items within each department's budget which exceed $10,000. The City Manager may transfer part or all of any unencumbered appropriation balance among programs within a department and, upon written request by the City Manager, the Council may by ordinance transfer part or all of any unencumbered appropriation balance from one department to another. Reporting: The Administration Department will provide timely reports of budget position to each Department Director, the City Manager, Mayor, and City Council. Expenditure Projection and Analysis: The Administration Department will analyze the expenditures of each department on a monthly basis and inform each Department Director whose expenditures appear to be exceeding the adopted budget. By the end of the seventh month of each budget year, the Administration Department will notify all Department Directors whose budgets are likely to be exceeded. The City Manager, Mayor, and City Council shall also be notified. Each Department Director so notified shall, within two weeks, inform the Finance Director and City Manager of the actions he/she will take to avoid exceeding the departmental budget. CONTROL OF BUDGET OVERRUNS Budget Overruns: If, during the budget year, the Administration Department shall determine that a department's expenditures will exceed the approved budget, the Assistant to the City Manager shall with the approval of the City Manager prepare an adjustment to the budget. If the department's expenditures are expected to exceed the approved budget a Budget Amendment shall be prepared for

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submission to the Mayor and City Council. In the event of an emergency, the City Manager may authorize an expenditure by a department which is in an "overrun" situation. Summary The Director of each department shall be held responsible and accountable for the expenditures of his/her department. The Assistant to the City Manager shall, through timely reports and analysis, keep Department Directors and elected officials informed of any possible budget problems. A department shall not exceed its approved budget without authorization from the City Manager. Amendments which change the total budgeted appropriations for any fund will be made through adoption of a budget revision ordinance.

CASH MANAGEMENT PROCEDURES

The City’s idle funds shall be invested in accordance with the Investment Policy adopted by the Mayor and City Council. Supplemental to these general policies and procedures the City’s Cash Management Officer shall monitor the cash and investment portfolio to maintain adequate collateral of deposits in excess of FDIC insurance. A schedule of collateral shall be maintained and monitored to insure that market values are equal to, or greater than 105% of estimated deposits in the overnight money market account. Weekly cash flow projections should be determined and/or calculated by comparing general ledger cash balances (cash board) with expected receipts or funds needed to cover next two payments cycles, security maturities and payments. If cash on hand is projected to exceed short term needs, then an analysis should be made to invest excess in a fixed maturity security. The new investment maturity should attempt to provide continuous monthly maturities up to a maximum of three years. The interest rate quoted may be tied to another rate to allow for market fluctuations (i.e, the most recent ninety-day (90) treasury bill plus or minus basis points). Any such rate must be subject to independent verification. To accomplish the above listed duties the following activities should be performed on a daily basis: • • • • •

Log on to the Bank On-Line Account Inquiry system and print the account balance for that day. Compare the bank balance with the General Ledger Cash Board for reasonableness, i.e. recently issued checks or deposits that may not have cleared. Compare the accounts payable open items list for large payments scheduled for the current and subsequent week to arrive at a cash needs amount. Project any significant cash receipts due that would correspond with outgoing payments, i.e. sales tax normally wired on the tenth of the month, franchise tax receipts and any grant or tax payments. Establish regular vendor payments utilizing ACH process.

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DEBT MANAGEMENT POLICY

DEBT TYPES The City of Lee's Summit is authorized to issue General Obligation Bonds, Revenue Bonds, and LeasePurchase Certificates of Participation.

In determining the type of bond to issue, the following factors should be considered: The direct and indirect beneficiaries of the project. A significantly large proportion of citizens should benefit from projects financed from general obligation bonds. o o o o o o

The time pattern of the stream of benefits generated by the project. The revenues that may be raised by alternative types of user charges. The cost-effectiveness of user charges. The effect of the proposed bond issue on the City's ability to finance future projects of equal or high priority. The true interest cost of each type of bond. The impact on the City's financial condition and credit ratings.

General Obligation Bonds The city is authorized to issue General Obligation Bonds payable from ad valorem taxes to finance capital improvements and equipment upon a two-thirds majority vote, and on general election dates a four-sevenths majority vote, of the qualified voters. The Missouri constitution permits the City to incur general obligation indebtedness for City purposes not to exceed 10% of the assessed valuation of taxable tangible property; and to incur general obligation indebtedness not exceeding an additional 10% for acquiring rights of way; constructing and improving streets, sanitary sewers, and storm sewers; and purchasing or constructing waterworks plants. General obligation, property tax-supported bonding should be used to finance only those capital improvements and long term assets, which have been determined to be essential to the maintenance or development of the City. The City should maintain a General Debt and Interest Fund balance which is at least 50% of the average annual debt service.

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Revenue Bonds The City is also authorized to issue Revenue Bonds to finance capital improvements to its combined water and sewerage system, airport and sanitary landfill facilities. These types of Revenue Bonds require a simple majority vote. Revenue Bonds do not carry the full faith and credit of the City in servicing bond indebtedness, and such bonds are not considered in determining the legal debt margin resulting from the 20% limitation described above. However, if any taxes are pledged or dedicated to the payment of revenue bonds (sales taxes, property taxes etc.) the bonds must be voted as general obligation bonds, the debt limit must be observed, and all bonds must be paid off within 20 years.

Revenue supported bonds should be used to limit potential dependence on property taxes for those projects with available revenue sources, whether self-generated or dedicated from other sources. Adequate financial feasibility studies should be performed for each project to provide assurances as to the self-liquidating nature of the project or adequacy of dedicated revenue sources. 63-20 Corporations (Municipal Building Authority) Internal Revenue Service Ruling 63-20 allows the City to create not-for-profit corporations. Through these corporations, the City can issue tax-exempt bonds for the lease purchase of equipment and facilities without the voter approval required for the issuance of general obligation bonds--the City's obligation under a one-year annually renewable lease is not an "indebtedness" according to the Missouri Constitution. The City has financed several projects and equipment purchases through the Lee's Summit Municipal Building Authority. Lease financing is appropriate whenever the introduction of leased equipment and/or a capital improvement results in verifiable operating savings that, properly discounted, outweigh the lease financing costs. Adequate financial feasibility studies should be performed for all innovative financing proposals such as lease and lease-purchase agreements, tax increment financing, pool participation, and special assessment projects. Long term borrowing will be confined to construction of capital improvements and acquisition of capital equipment too large to be financed from current revenues. Proceeds from long-term debt should only be used for construction project costs, acquisition of other fixed assets, bond issue costs, debt service reserve requirements, and refunding of outstanding bond issues and will not be used for current, ongoing operations.

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Debt will be extinguished within a period not to exceed the expected useful life of the capital project or equipment. The City should actively monitor its investment practices to ensure maximum returns on its invested bond funds while complying with Federal arbitrage guidelines. The Finance Department should continually monitor outstanding debt issues to verify compliance with debt covenants. The City's financial management policies should be oriented to maintain a balanced relationship between issuing debt and pay as you go financing. Financial Advisor The City shall retain the services of a Financial Advisor to assist the city in identifying capital financing alternatives and planning its debt program. The financial advisor's role in the debt issuance will vary depending on whether bonds are issued through a competitive or negotiated method of sale. The financial advisor should have no affiliation with the underwriting of a particular issue of the city. The financial advisor and or employees of the financial advisor shall not have made political contributions to any candidate for public office in the city for a period of two years preceding their selection as financial advisor. Method of Bond Sale When appropriate, new debt issues will be offered utilizing the competitive bid process. In a competitive sale, the financial advisor will assist in determining the structure and timing of the issue, prepare bond documents and rating agency presentations and evaluate the best bid and assist in the closing transaction. Refunding of Existing Debt The city will consider undertaking a refunding when one or more of the following three conditions exist: 1.

The present value of all refunding costs, (including interest, call premium, bond counsel, financial underwriter spread/discount and other issuance costs) is less than the present value of the current interest. Net present value savings should approximate a minimum of three percent (3%).

2.

The city wishes to restructure debt service.

3.

The city wishes to eliminate old bond covenants that may have become restrictive.

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3: Budget Overview Financial Underwriter

The financial underwriter shall determine which bid for the city's bonds is best by reviewing the pricing of comparable issues, talking to potential investors, identifying other similar issues that are likely to be in the market at the same time, and assessing the level of competition among various underwriting firms utilizing the Negotiated Sale process. The financial underwriter and or employees of the financial underwriter shall not have made political contributions to any candidate for public office in the city, for a period of two years preceding their selection as financial underwriter. Federal Arbitrage Compliance Arbitrage is the difference between the yield on an issuer's tax exempt bond and the investment income earned on the proceeds. Arbitrage profits are earned when lower-yielding tax-exempt bond proceeds are invested in higher-yielding taxable securities. Federal arbitrage restrictions imposed by the federal government prohibit an issuer from retaining arbitrage profits when investing bond proceeds at a yield that exceeds the yield on the bonds. The city will calculate or contract with a reputable firm to calculate, any arbitrage liability, and rebate such, to the U.S. Treasury in accordance with federal guidelines.

CAPITAL IMPROVEMENT PROJECTS (CIP) BUDGET ADOPTION AND ADMINISTRATION POLICY

The following procedures will be followed in the preparation, adoption, administration, and control of capital projects. Preparation and Adoption The City’s Charter mandates the development and annual review of a capital improvements plan and estimated operating and maintenance costs of the proposed improvements. The plan is formally adopted each year by the Planning Commission as part of the Comprehensive Plan. This approach addresses legal requirements for public hearings on the location, nature and extent of all projects. All costs identified for the first year of the plan are included in the City’s Operating Budget, which is adopted by the Mayor and City Council, for the upcoming fiscal year. Capital Expenditures Capital Expenditures are expenditures incurred through the acquisition or enhancement of fixed assets, to the extent the expenditure exceeds $1,000 and has a useful life or can be expected to extend the life three years or more.

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Capital Project Financing The City of Lee's Summit is authorized to issue General Obligation Bonds, Revenue Bonds, and Lease-Purchase Certificates of Participation. In determining the type of bond to issue, the following factors should be considered: • • • • • • •

The direct and indirect beneficiaries of the project. A significantly large proportion of citizens should benefit from projects financed from general obligation bonds. The time pattern of the stream of benefits generated by the project. The revenues that may be raised by alternative types of user charges. The cost-effectiveness of user charges. The effect of the proposed bond issue on the City's ability to finance future projects of equal or high priority. The true interest cost of each type of bond. The impact on the City's financial condition and credit ratings.

General Obligation Bonds The city is authorized to issue General Obligation Bonds payable from ad valorem taxes to finance capital improvements and equipment upon a two-thirds majority vote, and on general election dates a four-sevenths majority vote, of the qualified voters. The Missouri constitution permits the City to incur general obligation indebtedness for City purposes not to exceed 10% of the assessed valuation of taxable tangible property; and to incur general obligation indebtedness not exceeding an additional 10% for acquiring rights of way; constructing and improving streets, sanitary sewers, and storm sewers; and purchasing or constructing waterworks plants. General obligation, property tax-supported bonding should be used to finance only those capital improvements and long term assets, which have been determined to be essential to the maintenance or development of the City. The City should maintain a General Obligation Debt Service and Interest Fund balance which is at least 50% of the average annual debt service. Revenue Bonds The City is also authorized to issue Revenue Bonds to finance capital improvements to its combined water and sewerage system, airport and sanitary landfill facilities. These types of Revenue Bonds require a simple majority vote. Revenue Bonds do not carry the full faith and credit of the City in servicing bond indebtedness, and such bonds are not considered in determining the legal debt margin resulting from the 20% limitation described above. However, if any taxes are pledged or dedicated to the payment of revenue bonds (sales taxes, property taxes etc.) the bonds must be voted as general obligation bonds, the debt limit must be observed, and all bonds must be paid off within 20 years.

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Revenue supported bonds should be used to limit potential dependence on property taxes for those projects with available revenue sources, whether self-generated or dedicated from other sources. Adequate financial feasibility studies should be performed for each project to provide assurances as to the self-liquidating nature of the project or adequacy of dedicated revenue sources.

63-20 Corporations (Municipal Building Authority) Internal Revenue Service Ruling 63-20 allows the City to create not-for-profit corporations. Through these corporations, the City can issue tax-exempt bonds for the lease purchase of equipment and facilities without the voter approval required for the issuance of general obligation bonds--the City's obligation under a one-year annually renewable lease is not an "indebtedness" according to the Missouri Constitution. The City has financed several projects and equipment purchases through the Lee's Summit Municipal Building Authority. Lease financing is appropriate whenever the introduction of leased equipment and/or a capital improvement results in verifiable operating savings that, properly discounted, outweigh the lease financing costs. Adequate financial feasibility studies should be performed for all innovative financing proposals such as lease and lease-purchase agreements, tax increment financing, pool participation, and special assessment projects. Long term borrowing will be confined to construction of capital improvements and acquisition of capital equipment too large to be financed from current revenues. Proceeds from long-term debt should only be used for design and construction project costs, acquisition of other fixed assets, bond issue costs, debt service reserve requirements, and refunding of outstanding bond issues and will not be used for current, ongoing operations. Debt will be extinguished within a period not to exceed the expected useful life of the capital project or equipment. The City's financial management policies should be oriented to maintain a balanced relationship between issuing debt and pay as you go financing.

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Revenue Projections The primary support for general services comes from diverse revenue sources such as property taxes, sales taxes, and utility franchise taxes. Combined, these major revenue sources comprise approximately 78% of all general fund revenues. The balance of revenues is derived from user charges, fines and forfeitures, investment income, intergovernmental revenues and miscellaneous fees and charges. In previous years, these revenue sources experienced steady growth allowing the City to maintain and in some service areas expand the level of service. Recovery from the recent economic downturn has slowly occurred. In FY15, modest growth was budgeted in property and sales tax revenues but remained flat for franchise taxes. Anticipated growth is budgeted to be less than 2.5% compared to over 4% growth annually before the start of the recession. The following revenue projection pages are prepared for all major revenue sources over $1 million. They are presented in order of highest to lowest total revenue. The starting point for all account revenue projections begins with the new construction building permit activity of the past year. From this, assessed valuations are projected for the property tax accounts. The building permit information also provides an estimation of population growth, which is normally factored into the various accounts such as license, permits and fees. Historical account activity is tracked to also provide trend information to provide a comparative basis for projections. Each revenue page has five sections, which lists the account code, legal authorization, description, basis of revenue projection and the fund collection/distribution. 1. The Account Code section lists the specific line item that the receipt will be posted to in the city's general ledger accounting system. 2. The Legal Authorization section should list either the state statute or city ordinance, which allows the city to levy and receive this source of funds. 3. The Description section provides a brief explanation of the formula (i.e. tax levy times assessed valuation or building permit square footage times rate per foot), or established schedule of fees. 4. The Basis of Revenue Projection section describes the logic and/or assumptions used to arrive at the projected amounts and possibly he history or trend analysis of the particular account. The Fund Collection/Distribution section lists the most recent five years of actual receipt activity in the account, plus a projection for the current fiscal year and the upcoming budget year. In the case where a single revenue account is received in more than one fund, all funds are listed by fund category and then totaled. 71 | P a g e


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Property Tax Legal Authorization:

Account Codes:

State Statute : Chapter 94, Chapter 137 City Ordinance : N/A

4000, 4001, 4003, 4004, 4005

Description: Revenue from the ad valorem tax, levied on all real and personal property is based upon the assessed valuation as established by the County Assessor on January 1st of each year. Real property assessed valuation is determined by applying the market value times the appropriate assessment ratios. They are as follows: Commercial/Industrial - 32%; Residential - 19%; Agricultural - 12%. Personal property assessed valuation is set at 33% of market value and is determined by the State Tax Commission. Each year the City Council must set the rates to be levied for the City’s property taxes. In odd numbered years, all county assessors are required to re-assess property values in their county. For FY13, CY 2012, a levy rollup was enacted to recover the lost revenue following a decrease in assessed valuation. Budget amounts are calculated using the previous calendar year's final assessment or preliminary assessment. Because reassessment only occurs in odd numbered years, budgeted amounts fall short of actual amounts because of conservative growth projections at the time of calculation.

Basis of Projection & Analysis:

Financial Trend $29,000,000

Jackson County provided a preliminary assessment for FY14, CY 2013, of property values. The assessment indicated 1% growth in property tax values which will not require a levy adjustment.

$27,000,000

In FY15, CY 2014, the CY 2013 reassessment numbers were used to calculate the FY15 budget amount. A growth estimate of 300 new homes, with an average price of $150,000, resulted in an approximate increase of $6.8m in assessed value.

$21,000,000

$25,000,000 $23,000,000

$19,000,000 $17,000,000 $15,000,000 2006

2008

2010

2012

2014

2015

Fund Category Collection/ Distribution Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2014 2015

Annual

Actual Actual Actual Actual Actual Actual Actual Actual Budget Projected Budget

General Fund

Parks Fund

12,392,562 13,300,401 14,195,891 14,602,478 14,547,687 14,892,688 15,848,556 17,105,687 16,515,467 17,080,435 16,974,698

2,191,234 2,359,127 2,513,405 2,585,937 2,585,795 2,637,233 2,815,820 3,027,000 2,899,800 2,899,800 3,017,000

Debt Service Fund 6,617,224 7,201,005 7,670,169 7,888,020 7,895,226 7,773,817 7,594,422 8,024,576 7,734,741 7,734,741 8,033,772

Percent

TOTAL

Change

21,201,020 22,860,533 24,379,465 25,076,435 25,028,708 25,303,738 26,258,798 28,157,263 27,150,008 27,714,976 28,025,470

13.9% 7.8% 6.6% 2.9% -0.2% 1.1% 3.8% 11.3% -3.6% 2.1% 1.1%

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4: Revenue Projections

Sales Tax Account Codes:

Legal Authorization: State Statute :

Sections 94.500 to 94.550, 94.575-94.577 & 94.70094.705, and Chapter 144

City Ordinance :

1-7(2)

4020, 4021

Description: The City imposes a total sales tax of 2.25% on all goods and commodities sold within the City limits, and it is broken down into four funds as detailed below . Transportation and Park Development local sales taxes are not levied on utilities. The State of Missouri receives the tax from the respective business and distributes the funds monthly to the City. In an April 5, 2005 special election, the City voted to extend the Park Development Fund's local sales tax for a period of ten years beginning April 1, 2008 at a rate of one-quarter of one percent (1/4 of 1%). This rate was a .125% reduction from what was then the current rate. In an April 3, 2007 special election, the City also voted to extend the Capital Improvements sales tax for streets and related projects for a period of ten years from its pending expiration of March 31, 2008 with no rate change. Therefore, beginning April 1, 2008, the City's total sales tax rate was reduced from 2.375% to 2.25% due the reduction of .125% in the Park Development Fund.

Basis of Projection:

Financial Trend $33,000,000

FY14 budget estimated 1% growth on FY13 year to date actuals and includes $180,000 of new receipts to reflect taxes that have been collected and paid to another jurisdiction in error.

$31,000,000

FY15 budget estimated 1.5% growth on FY14 year to date actuals and includes new growth of $91k following a new grocery store development that is expected to be open in January.

$29,000,000 $27,000,000

Sales tax is broken between four funds as follows:

$25,000,000

1.000% 0.500% 0.500% 0.250%

General Fund Transportation Fund Capital Projects Local Park Development Fund

$23,000,000 $21,000,000 2006

2008

2010

2012

2014

2015

Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

General Fund 12,578,562 11,912,066 12,395,589 12,293,604 11,988,325 12,807,628 13,313,301 13,133,037 13,802,916 13,824,364 14,142,595

Park Development Fund 4,519,347 4,283,737 4,091,315 2,957,206 2,862,358 3,056,886 3,169,317 3,094,709 3,249,045 3,249,045 3,362,797

Transportation Tax Fund 6,028,162 5,712,776 5,889,151 5,834,171 5,720,233 6,116,282 6,337,138 6,190,196 6,496,722 6,496,722 6,818,854

Capital Project Fund 6,286,912 5,954,905 6,196,483 5,995,944 5,991,814 6,402,173 6,655,532 6,565,125 6,809,605 6,809,605 7,032,029

Annual Percent

TOTAL

Change

29,412,983 27,863,484 28,572,538 27,080,925 26,562,730 28,382,969 29,475,288 28,983,067 30,358,288 30,379,736 31,356,275

12.7% -5.3% 2.5% -5.2% -1.9% 6.9% 3.8% -1.7% 4.7% 0.1% 3.2%

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Utility Franchise Fees Electric, Natural Gas, Telephone, and Cable Account Codes:

Legal Authorization:

4040, 4041 4042, 4043

State Statute : Sections 94.110 - 94.120 City Ordinance : 28-90 through 28-97; 28-121 through 28-125; 28-150 through 28-153; 8-39 Description:

Electric: The City charges a license fee of 7% of the gross receipts derived from the sale of electric energy for domestic and commercial consumption within the City. The fee is collected by the utility company and remitted to the City the following month. Natural Gas: The City charges a license fee of 7% of the gross receipts derived from the sale of natural gas for domestic and commercial consumption in the City. The fee is collected by the utility company and remitted to the City the following month. Fees collected are highly dependent on weather conditions in the City. Wholesalers are also contracting with large volume users to purchase direct from the well fields avoiding the franchise fee. Cable: The City charges a license fee of 5% of the gross receipts derived on all service charges for customers subscribing to cable television service. The fee is assessed on regular monthly billing, and cable companies remit their fees on a quarterly basis to the City. Telephone: The City charges a license fee of 7% on the gross receipts derived from telecommunication services provided in the City. The fee is collected by the telecommunications companies and is then remitted to the City.

Basis of Projection & Analysis:

Financial Trend $18,000,000

FY14 franchise fees include a decrease in Natural Gas revenues following the rapid decrease in natural gas prices.

$16,000,000

In FY15 franchise tax revenue was budgeted close to the 3 year averages while factoring trend data. The lack of growth in franchise tax has prompted the City to conduct a franchise tax audit to determine if all tax revenue due is being remitted.

$12,000,000

$14,000,000

$10,000,000 $8,000,000 $6,000,000 2006

2008

2010

2012

2014

2015

General Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

Electric 4,259,259 4,659,832 5,945,521 5,752,438 6,424,501 6,879,663 7,013,016 6,897,629 6,999,098 6,820,194 6,924,255

Natural Gas 2,498,748 2,458,654 2,729,717 2,775,436 2,445,981 2,670,556 1,918,302 2,195,122 2,149,715 2,223,573 2,194,766

Telephone 1,037,857 1,005,314 5,020,069 3,194,742 4,838,274 5,525,907 3,739,688 3,668,256 3,769,097 3,508,351 3,616,686

Cable 822,085 898,264 967,484 1,014,328 1,116,837 1,173,511 1,072,791 1,319,367 1,158,405 1,160,364 1,242,717

TOTAL 8,617,949 9,022,064 14,662,791 12,736,944 14,825,593 16,249,638 13,743,797 14,080,374 14,076,315 13,712,482 13,978,424

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City of Lee’s Summit Annual Budget FY15

4: Revenue Projections

EATS -- Local Sales Tax Account Codes:

Legal Authorization: State Statute : Section 99.820, 99.845 City Ordinance :

4020, 4021

Description: For redevelopment projects approved by ordinance after August 31, 1991, fifty percent of the total additional revenue from taxes, penalties and interest which are imposed by the municipality or other taxing districts, and which are generated by economic activities within the area over a determined base amount, but excluding certain taxes, shall be allocated to, and paid to the municipality, who shall deposit such funds in a separate segregated account within a special allocation fund. Lee's Summit has seven active TIF redevelopment projects which are/will generate economic activity taxes (EATS): Summit Woods, Chapel Ridge, I-470 Business and Technology, Longview, Hartley Block, Todd George and 50 Highway and Summit Fair. In an April 5, 2005 special election, the City voted to extend the Park Development Fund's local sales tax for a period of ten years beginning April 1, 2008 at a rate of one-quarter of one percent (1/4 of 1%). This rate was a .125% reduction from what was then the current rate. In an April 3, 2007 special election, the City also voted to extend the Capital Improvements sales tax for streets and related projects for a period of ten years from its pending expiration of March 31, 2008 with no rate change. Therefore, beginning April 1, 2008, the City's total sales tax rate was reduced from 2.375% to 2.25% due the reduction of .125% in the Park Development Fund.

Basis of Projection & Analysis:

Financial Trend $3,700,000

EATs payments for a major shopping center ended in 2013. This amounts to an estimated $1 million reduction for general fund receipts. The same proportionate reduction was anticipated for the other funds. For FY14, EATs payments follow the gross sales tax projection as these are tied to sales tax revenue. FY14 budget assumes 1% growth based on current year to date actuals.

$3,200,000 $2,700,000 $2,200,000 $1,700,000 $1,200,000

In FY15, a new retail/grocery store development is planned to open. The TIF district is expected to generate approximately $300k in new sales tax. This partial increase reflects the stores opening mid fiscal year.

$700,000 $200,000 2006

2008

2010

2012

2014

2015

Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

General Fund 1,214,815 1,245,288 1,316,622 1,474,003 1,327,463 1,508,982 1,576,913 56,916 531,906 531,906 664,539

Park Development Fund

Transportation Tax Fund

451,583 466,996 464,489 392,347 331,991 377,262 394,228 14,229 132,978 132,978 146,230

602,110 615,968 658,311 737,002 663,981 754,491 788,456 28,458 265,953 265,953 276,100

Capital Project Fund 602,110 622,644 658,311 658,488 663,981 754,491 788,456 28,458 265,953 265,953 292,457

Annual Percent

TOTAL

Change

2,870,618 2,950,896 3,097,733 3,261,840 2,987,416 3,395,227 3,548,053 128,061 1,199,927 1,196,790 1,379,326

5.5% 2.8% 5.0% 5.3% -8.4% 13.7% 4.5% -96.4% 837% -0.3% 15.3%

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City of Lee’s Summit Annual Budget FY15

4: Revenue Projections

Payment in Lieu of Taxes (PILOT) Legal Authorization:

Account Code:

State Statute : Section 100.010 to 100.200, 353.030, and 99.800 to 99.865 City Ordinance : N/A

4006

Description: The City promotes economic development by utilizing several state authorized tax incentive mechanisms: 1. Chapter 100 - provides an incentive for new industries to locate in the area, as well as encourages companies already in the area to remain, by assisting them in improving their present facilities or in building new ones; ad valorem taxes on bond-financed property are abated, and negotiated PILOTs are made by the company to the City and each political subdivision. 2. Tax Increment Financing (TIF) - encourages development of blighted, substandard, or economically under-utilized areas that would not develop without public assistance; the PILOTs are made by property owners in the redevelopment area on the increase in current equalized assessed valuation of each such parcel, and such payments are deposited into the special allocation fund (SAF); payments to the SAF may be used to pay for the redevelopment project costs or to repay any obligation s (i.e., bonds or promissory notes) issued by the municipality to pay for the redevelopment project costs.

Basis of Projection:

Financial Trend $9,000,000

Chapter 100 Bonds Summit Technology, BHA Technologies Inc., and Kokam America are reflected in the General Fund category below. The PILOTs are generated pursuant to the terms of Section 100.010 to 100.200, RSMo. The allocation of the PILOT for distribution to the City is based on the City's levy in effect when the Section 100 Bonds were issued.

$8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000

Tax Increment Financing Hartley's Block, I-470 Business Center, Summitwoods Crossing, Chapel Ridge, Longview, Northeast, Summit Fair, and Todd George/50 Highway TIF revenues are reflected in the Tax Increment Financing Funds category below. The PILOTs are generated pursuant to the terms of the Real Property Tax Increment Allocation Redevelopment Act.

$1,000,000 $0 2006

2008

2010

2012

2014

2015

Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

General Fund 738,976 716,571 694,165 685,679 839,760 832,033 937,569 1,015,795 937,569 954,808 954,808

Special Revenue Funds

Tax Increment Financing Funds ------------

4,352,672 3,536,071 3,536,612 5,329,992 6,667,397 7,504,450 6,199,020 6,198,679 3,946,252 3,946,252 4,504,612

Annual Percent

TOTAL 5,091,648 4,252,642 4,230,777 6,015,671 7,507,157 8,336,482 8,336,482 7,214,474 4,883,821 4,901,060 5,459,420

Change 71.1% -16.5% -0.5% 42.2% 24.8% 11.0% 0.0% -13.5% -32.3% 0.4% 11.4%

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City of Lee’s Summit Annual Budget FY15

4: Revenue Projections

State Motor Vehicle Taxes and Fees FUEL TAX, SALES TAX, & LICENSE/TRANSFER FEE Account Codes:

Legal Authorization: State Statute :

4009, 4010, 4011

Article IV ,Section 30(b); Article X, Section 144.069; Chapter 142, Section 150.150;144.069; 94.560 City Ordinance : N/A Description:

Vehicle Fuel Tax: This tax is the City share of the state tax on motor vehicle fuel. Distribution to the cities is based on the population of that city as of the last census count, which for Lee's Summit is 2000. Vehicle Fuel Tax funds must be used solely for "construction, reconstruction, maintenance, repair, policing, signing, lighting, cleaning of roads, and for the payment of principal and interest on indebtedness on account of road and street purposes and uses thereof". Vehicle Sales Tax: This tax is on the purchase price of a motor vehicle, trailers, boats and outboard motors. Sales tax rate is determined where the vehicle is titled. Vehicle License/Transfer Fee: This fee is the City share of the State of Missouri vehicle license and transfer fees assessed. Allocation is based on a city's population according to the last Federal decennial census. The Street Department operations budget was moved under the auspice of the General Fund in FY 1996. Funds derived from this revenue source are to used solely for "construction, reconstruction, maintenance, repair, policing, signing, lighting, cleaning of roads, and for the payment and interest on indebtedness on account of road and street purposes and uses thereof".

Basis of Projection:

Financial Trend $3,400,000

For FY14, motor vehicle tax receipts were projected to decrease 0.5% from FY13 projections. Late in FY12, the motor vehicle fuel tax increased due to the results of the new census data which determines the disbursement allocation to cities.

$3,300,000 $3,200,000 $3,100,000 $3,000,000 $2,900,000

For FY15 motor vehicle taxes were budgeted to meet 3 year average amounts.

$2,800,000 $2,700,000 $2,600,000 $2,500,000 $2,400,000 2006

2008

2010

2012

2014

2015

General Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

Vehicle Fuel Tax 2,017,511 2,048,184 2,047,266 1,956,477 1,970,976 1,980,610 2,170,623 2,306,425 2,154,037 2,256,712 2,275,968

Vehicle Sales Tax 437,728 558,169 454,303 371,754 385,201 420,857 500,104 574,002 468,825 547,780 576,171

Vehicle License/Transfer Fee 446,636 437,838 312,707 308,086 307,527 310,500 357,738 381,790 337,794 348,433 337,794

Annual Percent

TOTAL

Change

2,901,875 3,044,191 2,814,276 2,636,317 2,663,704 2,711,968 3,028,465 3,262,217 2,960,656 3,152,925 3,189,933

-1.3% 4.9% -7.6% -6.3% 1.0% 1.8% 11.7% 7.7% -9.2% 6.5% 7.7%

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City of Lee’s Summit Annual Budget FY15

4: Revenue Projections

Interest on Investments Account Codes:

Legal Authorization: State Statute : Chapter 67 City Ordinance : see the City's Investment Policy

4600, 4601, 4602, 4603, 4604

Description: The City maintains a cash and investment pool which is available to all funds. These funds are combined and managed by the City's Cash Management Officer. Investments in the pooled cash fund include United States Treasury Bills and Notes and non-callable U. S. Agency offerings and are carried at cost, which approximates market value. Interest income is distributed by percentage, to the various funds on a monthly basis in accordance with the fund's cash balance. Current portfolio maturities extend to a maximum of three (3) years. New investments are usually made at the maximum three (3) year maturity.

Basis of Projection & Analysis:

Financial Trend $9,000,000

Projections are based on average cash balances multiplied by the average percentage yield. An interest rate of 1.25% for the 2011 budget and 1% for the 2012 budget. For FY15 an interest rate of 0.25% was assumed.

$8,000,000 $7,000,000 $6,000,000 $5,000,000

The graph to the right clearly illustrates the reduced return available on investments over the past year.

$4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 2006

2008

2010

2012

2014

2015

Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

General Fund 913,424 1,325,004 947,237 658,156 183,497 281,152 90,664 152,052 90,664 90,664 79,405

Special Revenue, Debt Service & Capital Project Funds 2,274,491 3,816,990 3,129,419 1,820,754 245,393 646,426 485,765 544,765 34,764 34,764 178,301

Enterprise Funds 1,444,627 2,588,566 2,709,663 1,401,400 145,272 325,226 92,118 125,239 38,500 38,500 63,931

Internal Service Funds 332,269 610,667 612,772 296,883 15,160 57,123 34,994 68,111 56,593 56,593 41,119

TOTAL 4,964,811 8,341,227 7,399,091 4,177,193 589,322 1,309,927 703,541 890,167 220,521 220,521 362,756

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City of Lee’s Summit Annual Budget FY15

4: Revenue Projections

CONTRIBUTIONS - FEDERAL Legal Authorization:

Account Code:

State Statute : N/A City Ordinance : N/A

4303

Description: Grant monies originating with the Federal Government, whether received directly from the Federal Government or indirectly from the State of Missouri, are recorded in this account. Federal Transportation funds (used for improving major roadways), Federal Airport Block Grants, Community Development Block Grants (CDBG), Highway Safety Grants, High Intensity Drug Trafficking Activity (HIDTA) funds, Federal Emergency Management Agency (FEMA) funds and Violence Against Women Act (VAWA) funds are recorded in this account.

Basis of Projection:

Financial Trend $16,000,000

Grants from the Federal Government for FY14 included primarily $4 million for airport improvements, $4 million for road improvements, $301 thousand for CDBG, and $101 thousand for VAWA. In FY15, the City's general fund is expected to receive funding for D.A.R.E and reimbursement for FBI Police training activies. In addition, the City will again apply for a Violence Against Women Grant (VAWA) which is a federal program designed to reduce violence.

$14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 2006

2008

2010

2012

2014

2015

Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

Special Revenue Funds

General Fund

$

249,111 177,016 164,403 95,963 152,952 222,895 129,624 183,576 195,114 195,114 126,614

$

962,112 494,369 660,738 392,592 326,168 194,792 386,146 390,021 497,567 497,567 506,462

Capital Project Funds

Proprietary Funds

$

2,786,042 9,653,004 1,739,725 4,353,384 1,982,042 311,929 701,484 6,052,000 4,000,000 4,000,000 3,676,000

$

3,838,621 3,748,385 2,496,782 -----4,738,000 4,738,000 -

TOTAL 7,835,886 14,072,774 5,061,648 4,841,939 2,461,162 729,616 1,217,254 6,625,597 9,430,681 9,430,681 $ 4,309,076

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City of Lee’s Summit Annual Budget FY15

4: Revenue Projections

Water Sales/ Sewer Charges Account Codes:

Legal Authorization:

4448, 4450

N/A State Statute : City Ordinance : 32.101, 32.313; see also the City's Schedule of Fees Description and Basis of Projection:

The Water Utilities Department serves over 35,000 customers. The total available water supply of 27.5 million gallons per day (MGD) includes 21 MGD from Kansas City, Missouri and 7.5 MGD from Independence, Missouri. Water consumption and sewer revenue projections are based on five-year consumption averages of customers. Customer data is collected by meter size, consumption volume and customer type and input within the Utilities' cost of service model to forecast revenue requirements. The model projects the necessary revenues to meet projected operational and capital expenses. A five-year projected rate schedule based on the revenue requirements is annually reviewed and adjusted as necessary. Monthly Water Base Rates (Effective January 1, 2014): Meter Size Water Base Meter Size Water Base Charge (Inches) Charge (Inches) 3" $16.63 5/8" $8.09 $36.29 3/4" $8.09 4" 1" $9.07 6" $55.95 8" $83.17 1 1/2" $9.75 2" $12.24 10" $202.24

Financial Trend $17,000,000 $16,000,000 $15,000,000 $14,000,000 $13,000,000

Water Volume Rates (Effective January 1, 2014): $4.08 per 1,000 gallons Commercial Rate Residential Rates for the first 7,000 gallons 7,001 to 15,000 gallons Over 15,000 gallons

$12,000,000 $11,000,000

$3.47 per 1,000 gallons $4.08 per 1,000 gallons $5.10 per 1,000 gallons

Water Sales

$10,000,000

Sewer Charges

$9,000,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2014 2015

Monthly Sewer Base Rates (Effective January 1, 2014): Meter Size Water Base Meter Size Water Base (Inches) Charge (Inches) Charge $11.65 3" $20.38 5/8" 4" $26.21 3/4" $11.65 1" $17.48 6" $34.95 1 1/2" $17.96 8" $43.68 2" $18.93 10" $53.39 Sewer Volume Rates (Effective January 1, 2014): All Usage $4.47 per 1,000 gallons

Water/Sewer Fund Category Collection/ Distribution Year 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual 2012 Actual 2013 Actual 2014 Budget 2014 Projected 2015 Budget

Water Sales 12,097,614 12,631,190 12,419,624 11,401,342 10,772,114 11,626,441 13,577,053 15,413,579 14,788,598 15,904,488 16,092,238

Sewer Charges

TOTAL

12,195,477 13,193,123 13,297,125 13,321,285 13,248,819 13,632,552 13,876,449 13,951,872 14,537,144 14,718,069 15,596,597

24,293,091 25,824,313 25,716,749 24,722,627 24,020,933 25,258,994 27,453,502 29,365,451 29,325,742 30,622,557 31,688,835

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City of Lee’s Summit Annual Budget FY15

5: General Fund Overview General

General Fund . The General Fund is the general operating fund of the City. Expenditures from this fund provide the basic city services, such as police and fire protection. It also funds the following departments and the services they provide: Administration, Codes Administration, Finance, Law, Municipal Court, Planning & Development, and Public Works. The General Fund is categorized as a governmental fund type. The major revenue sources of this fund are property taxes, retail sales taxes, and utility franchise taxes. The remaining revenues are derived from the various user fees and other sources. A key element of the budget process is projecting the fund’s ending reserve balance. Total expenditures for the upcoming fiscal year are set based on projected revenues for the coming year and to ensure fund reserves will remain at the level set by policy. Fund balance reserves represent the unappropriated accumulation of the difference between actual revenues and expenditures. The source and timing of revenues dictates the level of fund balance necessary to avoid cash shortages in normal day to day operations. The City recognizes the need to establish and maintain adequate reserves to avoid any disruption in service level caused by either a downturn in a significant revenue item or one that is only received at a particular time such as property taxes in December. Accordingly, the City Council adopted an ordinance that requires 16.67%, or an amount equal to two months of expenditures. The City utilizes Generally Accepted Accounting Practice (GAAP) based budgeting for the General Fund. This requires that the modified accrual method of accounting is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). “Measurable” means the amount of the transaction can be determined, and “available” means collectible within the current period or soon enough thereafter to be used to pay liabilities of current period. Revenues susceptible to accrual are property taxes, franchise taxes and interest revenue. Sales taxes collected and held by the state at year-end on behalf of the City also are recognized as revenue. User charges, fines, licenses, permits and miscellaneous revenues are not susceptible to accrual because generally they are not measurable until received in cash.

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City of Lee’s Summit Annual Budget FY15

5: General Fund Overview General

GENERAL FUND BUDGET SUMMARY YEAR BEGINNING JULY 1, 2014

REVENUES: Taxes Licenses, Permits & Fees Fines & Forfeitures Interest Intergovernmental Revenues Charges for Services Other Operating Transfers In Total Revenues

$

$

EXPENDITURES: Personal Services* Supplies Contractual Services Maintenance & Repair Utilities and Fuel Capital Outlay Operating Transfers Out Interest Expense & Depreciation Other** Total Expenditures

$

$

Excess of Revenues Over (Under) Expenditures

FY 2011 ACTUAL

FY 2012 ACTUAL

FY 2013 ACTUAL

47,877,351 $ 1,264,778 1,388,711 281,152 1,015,201 3,310,231 2,998,211 130,404 58,266,039 $

45,669,127 $ 1,328,522 1,534,265 90,684 823,492 3,605,332 1,617,830 2,502,778 57,172,030 $

48,879,612 $ 1,511,860 1,607,096 18,009 860,763 3,688,257 1,383,657 1,753,912 59,703,166 $

48,103,253 $ 1,279,490 1,519,417 90,684 829,576 3,521,327 1,591,091 1,996,350 58,931,188 $

49,402,910 $ 1,856,980 1,323,205 83,651 654,322 3,650,210 1,771,111 2,006,183 60,748,572 $

48,887,960 1,568,441 1,328,566 79,405 755,470 3,633,578 1,664,410 1,066,302 58,984,132

39,339,860 $ 2,087,184 7,975,289 4,284,832 2,295,985 95,887 1,500,638 0 15,841,078 73,420,753 $

39,730,876 $ 188,703 7,309,274 6,084,971 2,211,768 42,851 868,173 0 0 56,436,616 $

41,034,802 $ 147,573 7,323,030 6,271,365 2,294,753 0 663,668 0 0 57,735,191 $

41,168,680 $ 255,034 7,584,093 6,491,581 2,333,304 0 560,532 0 0 58,393,224 $

41,504,462 $ 134,503 6,500,776 6,594,096 2,317,311 461 657,725 56,639 0 57,765,973 $

42,460,090 137,980 8,052,759 6,714,884 2,416,546 0 663,668 0 0 60,445,927

(15,154,714)

735,414

BUDGET

1,967,975

FY 2014 PRELIMINARY YE

537,964

2,982,599

FY 2015 Requested

(1,461,795)

Fund Balance, Beginning of Year

$

27,326,465 $

12,171,751 $

12,907,165 $

14,875,140 $

14,875,140 $

17,857,739

Fund Balance, End of Year

$

12,171,751 $

12,907,165 $

14,875,140 $

15,413,104 $

17,857,739 $

16,395,944

Net Unrestricted Fund Balance

12,171,751

12,907,165

14,875,140

15,413,104

17,857,739

16,395,944

Percentage of Expenditures (including transfers)

16.6%

22.9%

25.8%

26.4%

30.9%

27.1%

REVENUES, EXPENDITURES & FUND BALANCE

Revenue

Expenditures

$75,000,000 Fund Balance

$65,000,000 $55,000,000 $45,000,000 $35,000,000 $25,000,000 $15,000,000 $5,000,000 ACTUAL FY 2011

ACTUAL FY 2012

ACTUAL FY 2013

BUDGET FY 2014 FISCAL YEAR

PRELIMINARY YE

Requested FY 2015

*No vacancy rate assumption used for Personal Services. ** This summary reflects budget amendments and the accural of a one-time legal settlement payment of $15.5M in FY11. The payment occurred after the FY12 budget adoption and is therefore not reflected in all tables and graphs in this document unless specifically stated.

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City of Lee’s Summit Annual Budget FY15

5: General Fund Overview General

General Fund Revenues by Source

6%

Property Taxes

2%

Sales Taxes Franchise Taxes 30%

Motor Vehicle Taxes Other Taxes

5%

Fines & Forfeitures Licenses & Permits Intergovernmental Charges for Services

24%

Investment Earnings 23%

Other Transfers In

Account Property Taxes Sales Taxes Franchise Taxes Motor Vehicle Taxes Other Taxes Fines & Forfeitures Licenses & Permits Intergovernmental Charges for Services Investment Earnings Other Transfers In Total

FY14 Budget 17,453,036 13,271,010 14,076,315 2,960,656 342,236 1,519,417 1,279,490 829,576 3,521,327 90,684 1,591,091 1,996,350 58,931,188

FY15 Change from FY14 Budget $ % Requested 17,929,506 476,470 2.7% 13,478,056 207,046 1.6% 13,978,424 -97,891 -0.7% 3,189,933 229,277 7.7% 312,041 -30,195 -8.8% 1,328,566 -190,851 -12.6% 1,568,441 288,951 22.6% 815,470 -14,106 -1.7% 3,633,578 112,251 3.2% 79,405 -11,279 -12.4% 1,664,410 73,319 4.6% 1,006,302 -990,048 -49.6% 58,984,132 52,944 0.1%

Summary of Significant Assumptions and Changes for FY15 • • • • •

Increased Property Tax and Permit fee revenue based on the development of 300 new homes valued at $150k. Growth in the sales tax base of $91k with the development of a new grocery store development area. Sales tax revenues assume 1.5% growth from FY14 to factor population growth. Flat Franchise Tax revenues A decrease of $1m following the repayment of a general fund loan for the construction of a community center

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City of Lee’s Summit Annual Budget FY15

5: General Fund Overview General

General Fund Expenditures by Department Administration

2% 6% 12%

6%

PW Engineering Police Fire Finance

10% 32%

Law Planning Court PW Operations

26%

Codes Development Center

Department Administration PW Engineering Police Fire Finance Law Planning Court PW Operations Codes Development Center Total

FY14 Budget 3,452,683 3,772,615 19,043,674 15,473,009 5,129,725 1,130,872 974,475 815,560 7,149,928 1,450,682 0 58,393,223

FY15 Requested 3,609,723 3,842,083 19,245,826 15,543,898 6,092,469 1,258,971 795,735 800,607 7,079,262 1,198,238 979,114 60,445,926

Change from FY14 Budget $ 157,040 69,468 202,152 70,889 962,744 128,099 -178,740 -14,953 -70,666 -252,444 979,114 2,052,703

% 4.5% 1.8% 1.1% 0.5% 18.8% 11.3% -18.3% -1.8% -1.0% -17.4% n/a 3.5%

Summary of Significant Assumptions and Changes • • • •

An average 1% performance based merit adjustment at approximately $350k Creation of the Development Center department Inclusion of a Voluntary Retirement Maximization Program (VRMP) at $700k An increase of 8%, or approximately $400k, for health insurance costs

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GeneralFund Overview 5: General

City of Lee’s Summit Annual Budget FY15

General Fund Expenditures by Type Personal Services

9%

Supplies for Resale

3% 2%

Other Supplies/Services Repairs & Maintenance

13%

Utilities Fuel & Lubricants Miscellaneous 70%

Capital Outlay Interdepartmental Charges Transfers

Account Personal Services Supplies for Resale Other Supplies/Services Repairs & Maintenance Utilities Fuel & Lubricants Miscellaneous Capital Outlay Interdepartmental Charges Transfers Total

FY14 Budget 41,260,988 135,880 7,491,786 1,292,364 1,641,226 692,078 119,154 0 5,199,217 560,532 58,393,225

Change from FY14 Budget FY15 $ % Requested 42,460,090 1,199,102 2.9% 137,980 2,100 1.5% 7,923,079 431,293 5.8% 1,301,073 8,709 0.7% 1,723,693 82,467 5.0% 692,853 775 0.1% 129,680 10,526 8.8% 0 0 n/a 5,413,811 214,594 4.1% 663,668 103,136 18.4% 60,445,927 2,052,702 3.5%

Continued: Summary of Significant Assumptions and Changes • • • • • •

Increased level of funding for the Worker’s Compensation program, $302k Continued cost and budget containment practices: FY15 Budget reductions total approximately $1.3m which follows $1.2m of cuts in FY14 Implementation of a 3 year community marketing program, $126k for year 1 Creation of a new Economic Development program, $200k Salary costs budgeted at 97.3% of full employment costs to account for vacancy savings. Anticipated vacancy savings for FY15 is $800k Implementation of the Evergreen Compensation & Benefit study, phase 3, for $83k

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City of Lee’s Summit Annual Budget FY15

General Fund Full Time Equivalents Workforce, or employee counts, is described as a ratio of full time equivalents (FTE) where one full time employee is estimated to work 2,080 hours annually or 2,912 for certain fire department personnel. General Fund Employment Totals Departments: Administration Pub. Wks./Engineering Law Enforcement Fire/Ems Services Finance Legal Services Planning & Development Municipal Court PW Operations Division Codes Administration Development Center

Total

FY14 Full Time Equivalents Budgeted Hours 27.01 48,261 38.65 80,401 204 424,320 146 404,352 21 43,680 10.5 21,840 9.91 20,606 11.5 22,864 46.67 97,066 16 33,280 0 0

531.24

1,196,669

FY15 Full Time Equivalents Budgeted Hours 26.31 46,805 38.9 80,912 204 422,760 144 399,360 21 43,680 11.5 23,920 8.37 16,892 12.5 24,240 41.34 85,987 13.35 27,768 7.47 15,538

528.74

1,187,862

Summary of Significant Assumptions and Changes • • • •

6 vacant Public Works Operations positions were eliminated 2 new positions were added in FY15: Director of Human Resources, Economic Development Manager Approximately 60 employees are eligible for retirement benefits Cash liability to pay out unused vacation and sick time totals approximately $1.4m

General Fund Employment Totals 8%

3% 1% 5%

Administration 7%

Pub. Wks./Engineering

2%

Law Enforcement

2%

Fire/Ems Services

4%

Finance Legal Services Planning & Development 39% 27%

Municipal Court PW Operations Division Codes Administration Development Center

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General Fund Budget Reductions For the second straight year the general fund budget was developed within a financially constrained environment following slower than expected growth in revenues and increased operating costs. In FY14, general fund department budgets were reduced 2% from their original request which resulted in approximately $1.2m in budget reductions. In FY15, the City’s Management Team was asked to review programs and services and identify opportunities to reduce funding. The following list of reductions were made in the FY15 Budget. Significant Expenditure Reduction Proposals: 1. Support to Boards & Commissions -35,350 2. Support to Public Service Agencies -48,000 3. Contract for concrete repairs -199,655 4. Health Insurance Cost Control Measures -564,171 5. Reduce City Scope from 4 to 2 -23,300 6. Reduce funding for Holiday Party -2,000 7. Eliminate Legislative Services -6,000 8. Extend life of Patrol Vehicles -70,786 9. Public Safety Education Programs -7,000 10. Adjustment from 2% to 1% merit pool -346,772 Sum: -1,303,034

Impact of General Fund budget reductions • •

• • • •

Funding for Art’s Council, Beautification Commission, and Historic Preservation activities were reduced $35k. This reduction partially reduced funding for annual initiatives, but allowed for the continuation of the programs and services. The City’s partner organizations, (Chamber of Commerce, Economic Development Council, Downtown Lee’s Summit Main Street) received reduced funding amounts following the elimination of a general fund transfer to the Business and Industry Fund (B&I). The B&I Fund accounts for proceeds from the City’s hotel and motel tax. These funds have been dedicated to fund programs and services that increase tourism and economic development. The City currently has a contract for concrete repairs. Contract prices are cheaper per unit than what is being done in-house. 6 vacant Public Works positions were eliminated savings approximately $500k while being offset by a contract increase of $200k. Health insurance costs were budgeted to increase 14% but bids arrived totaling an 8% increase. The City’s community newsletter will be produced semi annually instead of quarterly. With improvements to the City’s website, and utilization of social media tools, the reduction should have little or no impact saving $23k. Analysis was conducted and determined that the City could optimally make use of its patrol vehicles by extending the service life another year while still preserving resale value.

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General Fund Reserve Balance During the budget process, the General Fund reserve balance is projected for five fiscal years out from the budget year to evaluate the long term impact of current budget and spending decisions. The projections are very fluid, particularly during the budget process and new information becomes available and various assumptions and budget levels are evaluated. The table below reflects the five year projections used during the FY15 budget process containing the information available at that time. GENERAL FUND BALANCE FY13 Actual Total revenues Total expenditures Revenues - Expenditures

FY15 Budget

FY14 Actual*

FY16 Projected

FY17 Projected

$ $

60,102,760 59,391,580

$ $

$

(1,461,795) $

711,180

$

$ $

59,703,165 57,794,309

$ $

60,748,573 57,765,972

$ $

$

1,908,856

$

2,982,601

58,984,132 60,445,927

61,270,038 61,572,396

FY18 Projected $ $

(302,358) $

FY18 Projected

FY19

62,744,736 63,808,993

$ $

(1,064,257) $

63,970,560 66,103,279

$ $

(2,132,719) $

65,360,323 68,457,248 (3,096,925)

Net change in fund balance Beginning Fund Balance

$

12,907,165

$

14,816,021

$

17,798,622

$

16,336,827

$

17,048,007

$

16,745,648

$

15,681,391

$

15,681,391

Ending Fund Balance

$

14,816,021

$

17,798,622

$

16,336,827

$

17,048,007

$

16,745,648

$

15,681,391

$

13,548,672

$

13,548,672

Ending FB as a % of exp

25.6%

30.8%

28.7%

27.0%

27.2%

24.6%

20.5%

19.8%

$

11,558,862

$

11,553,194

$

10,076,336

$

9,900,576

$

10,264,118

$

10,636,959

$

11,019,417

$

11,411,823

- 20% Reserve Balance Amount $

11,558,862

$

11,553,194

$

12,089,185

$

11,878,316

$

12,314,479

$

12,761,799

$

13,220,656

$

13,691,450

Required Reserve Balance *Unaudited

*Note*: FY14 Actuals are preliminary, unaudited, year end amounts

Until recently, General Fund revenues exceeded expenditures, as depicted in the following graph. The City Manager, Management Team, and staff have been working over the last few years to make the necessary structural adjustment to correct future defecits. Beginning in FY14 and continuing through FY16 with the City Manager’s two year plan, the City will reduce expenditures to levels that can be funded with reoccuring revenues. This will require reductions in personnel expenses and service expenditures. In FY16, the projected reductions amounts total approximately $2.1m with $1.5m of reductions coming from salaries, health insurance, overtime, and benefit costs. General Fund Year End Balance after 2 year plan $30,000,000 16.67% of GF Exp

$25,000,000 20% of Exp

$20,000,000 $15,000,000 $10,000,000 $5,000,000

FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 Budget

Fiscal Year

Projected

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General Fund Reserve Balance Policy In FY14 the City Council adopted a new fund balance policy. The adequacy of unrestricted fund balance in the general fund should be assessed based upon a government’s specific circumstances. The Government Finance Officers Association recommends, at a minimum, that general-purpose governments, regardless of size, incorporate in its financial policies that unrestricted fund balance in their general fund be no less than two average months of regular general fund operating revenues or regular general fund operating expenditures. If fund balance falls below the policy level it should be replenished within the subsequent year or in the case of an extraordinary expenditure three years.

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6: General Fund Department Budgets General

ADMINISTRATION Administration provides the general supervision and support for all departments within the City and also serves as the link between the elected governing body and the staff of the City’s departments. Administration oversees four internal service divisions whose primary function is to provide support for all City departments. Internal Service Divisions falling under the auspices of the City Manager's Office includes Information Technology Services, Fleet Operations, Central Building Services and Human Resources. Another significant capacity fulfilled by Administration is to provide support to the Mayor, City Council and various City committees. These committees are comprised primarily of a diverse set of volunteer citizens who perform a compelling service to City operations. Among other support activities, Administration provides public communication, research, analysis and recommendations on policy and service matters for the elected officials and the City committees. HUMAN RESOURCES The Human Resources Division reports to the City Manager and operates as an internal service agent for all City departments and employees. Its primary function is to administer and oversee all personnel and employee service programs including recruitment and hiring, performance management, labor relations, employee benefit programs, payroll, training and development, safety, workers compensation and risk management efforts.

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CODES ADMINISTRATION The Codes Administration Department merged with Planning and Development as a result of the new Development Center Department coming on line. The new department will have two primary functions, Planning Services and Codes Administration. However, for FY15 we will continue to present two separate budgets. Codes Administration is staffed with 12 full time employees and consists of four closely related divisions (Administration, Permit and Plan Review, Building Inspections, and Neighborhood Services). Each division has a distinct yet vital part of code enforcement within the community. Through the Neighborhood Services Division, the department also facilitates the Community Development Block Grant (CDBG) funded Minor Home Repair Program. The mission of the Codes Administration Department is to promote and influence public safety and welfare by working with stakeholders in the planning & construction of buildings and building systems; and maintenance and use of private property. The Administration Division provides administrative functions for the department and also provides staff support to the Board of Appeals as well as other economic development related boards and committees. During the conceptual and planning stages of a project the Permit and Plan Review Division reviews all construction documents to ensure code compliance prior to permit approval and issuance of building permits. Once the building permit has been issued, the Building Inspections Division ensures the actual construction of the project complies with adopted building codes and approved construction documents through the performance of required inspections during various stages of the project. Finally, after project completion and occupancy, the Neighborhood Services Division assures the structures and property is used and maintained in a safe code compliant manner. In addition, Neighborhood Services is also responsible for zoning enforcement to ensure compliance with the provisions of the Unified Development Ordinance (UDO). The Minor Home Repair Program facilitated by the department provides a source for lowmoderate income families to make improvements to owner occupied single-family residences through CDBG grants obtained by the City. This program is often used to abate property maintenance concerns being pursued by the Neighborhood Services Division.

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The Lee’s Summit Municipal Court is a division of the Jackson County Circuit Court. The municipal court maintains all files and papers necessary to schedule and conduct trials, pleas, pre-trial hearings, sentencing, probation revocation hearings, and pre- and post-trial motions related to violations of city ordinances. The administrative and clerical staff, bailiff and judges administer the process of adjudicating matters under the Court's jurisdiction. The efforts of all are directed toward the goals of the fair and efficient administration of justice, to dispense equal justice to all, to provide courteous and respectful service to the public and to encourage respect for the rule of law. The Lee's Summit Municipal Court consists of two elected Judges, Court Administrator, two Probation Officers, Court Security Officer, Accounting Technician, Record Management Clerk, Warrant Clerk, Bond Clerk, two Deputy Court Clerks. Cases are scheduled for the first four Wednesdays and Thursdays of each month beginning at 8:30 a.m., with a final docket held at 3:00 p.m. Presiding Judge James M. Tobin presides over Division 263 on Thursdays, and Judge Dana M. Altieri presides over Division 243 on Wednesdays. Special dockets are devoted to animal control cases, domestic violence cases, nuisance cases and zoning matters from the Neighborhood Services Division. An 9:00 a.m. prisoner arraignment docket is held on Tuesday of any week lacking a court docket. If the individual charged with the offense pleads guilty, a fine, imprisonment or probation may be assessed. If the defendant pleads not guilty, a bench trial is conducted. The defendant may appeal a finding of guilty to the Jackson County Associate Circuit Court. In addition, the Court operates a Violations Bureau which permits individuals charged with certain traffic and other violations to pay a fine without appearing before the Judge.

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DEVELOPMENT CENTER DEPARTMENT

The Development Center Department is staffed with six full time employees and consists of three closely related divisions (Administration, Support to Development, and Business & Contractor Licensing). Each division has a distinct part of assisting customers in successfully navigating each step of the City’s business and development related processes from preapplication to occupancy (start to finish). The Development Center Department is dedicated to working collaboratively with stakeholders to effectively align resources for successful outcomes through a customer focused approach. In pursuit of this mission the Development Center Department values integrity, accountability, responsiveness, respect, commitment, teamwork and communication. The Administration Division provides administrative functions for the department and also provides staff support to the Land Clearance for Redevelopment Authority (LCRA), Lee’s Summit Missouri Municipal Building Authority (LSMMBA), as well as other economic development related boards and committees. The Support to Development Division consists of project managers that facilitate the “one stop shop” approach working alongside applicants to navigate and manage the business and development related processes. The Business and Contractor Licensing Division assists customers through the business and contractor licensing processes. This organizational structure exists for customers to be provided with one point of contact to assist them in working with multiple departments within the City. In addition to coordinating customers’ needs with internal City departments, Development Center Department staff work closely with the City’s local partners in promoting business and economic development. Partner organizations include the Lee’s Summit Chamber of Commerce, the Lee’s Summit Economic Development Council, Downtown Lee’s Summit Main Street, Inc., and Boost Lee’s Summit.

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City of Lee’s Summit Annual Budget FY15 FINANCE

The Finance Department is responsible for all cash receipts and disbursements and maintenance of an internal control structure that adequately safeguards the assets of the City. Finance also oversees the auditing, procurement, and reporting functions of the City. The department’s expenditures are allocated between five programs. Those programs are Departmental Administration, Budget and Accounting Services, Debt and Cash Management, Procurement, and Support to Development. All Finance department programs are classified in and charged directly to the General Fund. The Departmental Administration program’s primary function is to account for general and administrative expenditures necessary to operate the department. These charges are common to all divisions and not directly associated with any particular one, i.e. Information Technology Systems and Central Building Services overhead and replacement allocations. The Budget and Accounting Services program involves the traditional processing of all of the City's invoices for goods and services and recording all related general ledger transactions in order to prepare financial statements in conformity with Generally Accepted Accounting Principles. This program is also responsible for establishing and maintaining an internal control structure and procuring the independent financial audit each fiscal year. The objectives of an internal control structure are to provide management with reasonable assurance that assets are safeguarded against loss from unauthorized use or disposition. The Debt and Cash Management Program is responsible for establishing proper internal controls for the collection and distribution of revenue for the 70 active funds. In addition, this program oversees the City's outstanding and active debt issues approximating $74.3 million and maintains the City’s investment portfolio averaging $100 million according to the City investment policy and cash management procedures. Procurement and Contract Services provides semi-centralized procurement of goods and services. The division is responsible for obtaining commodities and services at the most economical prices while ensuring compliance with all applicable laws and policies. It also directs the procurement of professional services, heavy equipment, small construction, vehicles and other goods and services. Lastly, the division establishes contracts to provide an immediate and uninterrupted source of supplies for frequently used items and is responsible for the disposal of surplus property. The Support to Development program accounts for finance related expenditures attributed to economic development and any associated tax incentive programs.

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City of Lee’s Summit Annual Budget FY15 FIRE DEPARTMENT

The Fire Department provides services to the community in the areas of fire protection, emergency medical services, rescue services, hazardous materials, and emergency management. The organization is assigned most emergency service functions of the city other than law enforcement. Contract emergency services are also provided for Greenwood and Unity Village. The Emergency Services Program of the department includes fire suppression, emergency medical services, rescue responses, hazardous materials mitigation, and the response and management of citywide emergencies and disasters. The department provides the emergency services from seven strategically located fire stations. Fire suppression services are rendered from seven staffed pieces of fire apparatus. This includes five pumping engines which are Compressed Air Foam System (CAFS) and two combination engine/ladder trucks. All frontline fire apparatus are equipped with thermal imaging cameras, carbon monoxide detectors and vehicle extrication equipment. All sworn personnel are state-licensed emergency medical technicians or paramedics providing emergency medical service. The department equips all fire apparatus with emergency medical supplies and operates five paramedic-staffed rescue ambulances. Specialized rescue services include the areas of high angle, fast water rescue, trench cave-in, automobile extrication, and confined space. All fire fighters are trained as hazardous materials first responders, and the department operates an advanced hazardous materials response team. The fire department serves as the coordinator for the city in managing citywide emergencies and disasters. The Prevention Program of the department provides for loss reduction activities in all mission areas. This includes fire prevention, hazardous materials prevention, and general safety awareness and education. The Prevention Program is designed to reduce the loss of life, injuries and property damage from fire, hazardous materials incidents, and/or man-made and natural disasters. The department operates a regional fire and emergency medical service communications center. In addition to serving as the focus for all city communications other than police, the center provides contract services for the Lake Lotawana, Lone Jack, Fort Osage, Sni Valley, West Peculiar, Western Cass Fire, Prairie Township, and Pleasant Hill Fire Protection Districts.

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The Law Department is divided into two divisions: Civil and Prosecution. By the City Charter, the City Attorney supervises and directs the Law Department. Civil Division: Division personnel consist of the City Attorney, one Deputy City Attorney, one Assistant City Attorney II, one Assistant City Attorney I/Risk Manager, one Police Legal Advisor, one Office Coordinator II, and a Legal Secretary. The Civil Division provides legal advice and counsel to the Mayor, City Council, appointed officials, and City staff on the full range of legal issues which confront the City of Lee's Summit. The City Attorney or his/her designee attends all City Council meetings and other board and committee meetings as necessary or upon request to provide legal guidance. In addition, the Civil Division attorneys regularly:      

 

confer and work with the City Manager, Department Directors and City staff to develop strategies for resolving legal issues; respond to lawsuits against the City; review and approve contracts and other legal documents prior to consideration by the City Council; draft ordinances, contracts, resolutions, conveyances and other legal documents; monitor and coordinate all litigation files with outside legal counsel; research, prepare memoranda and provide advice on various legal issues such as economic development, employment, real estate, environmental, procurement, contract compliance, planning and zoning, open records and meetings, local government liability and numerous constitutional matters; review current case law and legislative enactments to evaluate potential impact on the City; and work with City departments to collect on past due accounts.

Prosecution Division: Division personnel consist of one full-time Prosecutor, one part-time Prosecutor and two Paralegals. The Prosecution Division is responsible for prosecuting city ordinance violations in the City's Municipal Court and trials de novo, appeals, and jury trials in the Circuit Court of Jackson County. The ordinance violations range from routine traffic offenses to domestic violence offenses and include nuisance and animal control violations. The Prosecution Division also enforces the City's Fire Code, Building Code, and Zoning Regulations. The Prosecutors also advise police and other enforcement staff on the preparation and presentation of cases in court, as well as issues related to the Open Records laws.

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PLANNING AND DEVELOPMENT Planning and Development, upon the creation of the Development Center, has merged with Codes Administration to become a single department with two primary functions, Planning Services and Codes Administration. For this budget cycle we will continue to present two separate budgets. Planning Services will be presented under Planning and Development and Codes Administration will be under its own title. Planning Services provides support to the development community and the general public on land use matters. Planning Services is staffed with 8 full time employees and is organized into three Divisions consisting of Administration, Current and Long-Range Planning. The Administration Division is responsible for managing and directing the overall operations of the Department including development and monitoring of the Department’s budget, performance goals and objectives, setting Department policy, directing the amendment process of the UDO and serving as part of the City’s senior management team. The Current Planning Division processes applications for rezoning, special use permits, special event permits, home occupations, variances, preliminary and final development plans and subdivision plats and issues sign permits and zoning approvals. The Long-range Planning Division prepares current and future land use plans, provides updates to the Comprehensive Plan, compiles statistics including population projections, produces the annual development report, prepares maps used by the Department and public and manages the CDBG program. The Planning Services staff reviews all applications and accompanying plans and makes recommendations to the appropriate board. The department provides staff support for the Planning Commission, City Council, Board of Adjustments, Historic Preservation Commission, Community and Economic Development Committee, Community Development Block Grant Committee as well as ad hoc Committees appointed by the City Council or Planning Commission. Planning Services also provides information to the general public, including realtors, appraisers, developers, contractors, citizens and others, regarding general and specific land use issues. Planning Services participates in special projects such as corridor studies, land use initiatives and targeted quadrant comprehensive plan reviews as needed.

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POLICE DEPARTMENT NARRATIVE The Police Department is comprised of three (3) Divisions: Operations, Investigations, and Administration. The Department is allocated 143 Police Officers and 68 Civilian Staff for a total of 211 personnel (206.70 FTE’s). The Administration Division consists of six (6) major components. Those components include the Animal Control Unit which is responsible for both public health and safety issues related to domestic and nondomestic animals. The Communications Unit handles all 9-1-1 calls for the City as well as non-emergency calls for Police and Animal Control. The Public Information Unit is responsible for media relations, managing the hiring process, and community interaction and crime prevention education through the Crime Prevention Officer. The Unit also supports the Police Service Officers who perform various functions including walk-in police reports, fingerprinting, and child-safety seat inspection and installation. The Professional Standards and Compliance Units have overall responsibility of ensuring compliance to policy and procedure by the Department. This is achieved through planning and research and policy development. The Facilities Maintenance Unit is responsible for the overall upkeep and repair of the police facilities as well as maintenance of the Departments’ communications equipment and installation of mobile radios, mobile data terminals, and other equipment. Lastly, the Information Management Unit handles the purchasing function, payroll function, and all other fiscal responsibilities, as well as supervision of the Records Unit. The Alarm Coordinator is also part of the Records Unit. The Operations Division includes the District Patrol, Traffic Safety, and Detention Units. The District Patrol function provides 24 hour police service. They answer calls for service, perform initial crime investigation, and arrest offenders of the law. A K-9 Unit also supports the Patrol Officers. The Traffic Safety Units’ primary responsibilities are investigating motor vehicle crashes, and enforcement of state and local traffic laws. The Detention Unit houses short-term inmates and is responsible for the inmates’ life-care needs while in custody. The Investigations Division is comprised of three (3) Units; Criminal Investigations, Special Investigations and Juvenile Investigations. The Criminal Investigations Unit performs follow-up investigative work on reported crimes. In addition, two (2) Domestic Violence Investigators are assigned to the Unit. The Special Investigations Unit investigates narcotics law violations, liquor law violations, and other vice crimes. The Juvenile Investigations Unit is responsible for all police-related interactions with youth, including: DARE, School Resource, and Youth Court, which acts as a follow-up in the prevention of delinquency. Two other Units which add support to the Department, but operate out of the Investigations Division, are the Polygraph Unit and the Bomb Unit. The Polygraph Unit handles internal affairs investigations. The Bomb Unit renders assistance with explosives or the threat of explosives. They also provide service to other agencies as needed.

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GeneralFund Department Budgets 6: General

City of Lee’s Summit Annual Budget FY15 ENGINEERING

The Public Works Engineering Division is comprised of the Administration Group, a Project Engineering Group, an Engineering Support Group, a Development Engineering Group, a Traffic Engineering Group, and a Construction Management Group. Funding is primarily from the General Fund, supplemented by transfers from the various enterprise and capital project funds for directly related program costs. The Public Works Administration Group includes the Department director and other support staff who provide overall guidance and management of all divisions of the Public Works Department. The Administration Group also includes the centralized customer service function for the department. The Project Engineering Group manages the design process for the City's major drainage, water, and sewer infrastructure projects, as well as some road projects. A significant portion of the work produced by this group is in-house design. The Engineering Support Group includes technicians that support the in-house design efforts as well as additional engineering project management for road and airport projects. The support group also provides engineering services to the Public Works Operations Division when needed. Development Engineering provides the engineering services needed to support quality growth and development in the community. It provides review of residential development plans for infrastructure (sanitary sewers, water mains, storm water systems, streets, and traffic controls) sufficiency, serviceability, compatibility, and integration with existing facilities. The Public Works Inspections section inspects all developer-constructed infrastructures for compliance with City codes and makes recommendations for acceptance of the facilities as public. The Traffic Engineering Group is responsible for design of traffic control devices, street lighting and some road projects within the City. The group also provides engineering services related to traffic operations and works closely with the Public Works Operations Division. The Traffic Engineering Group is also responsible for the long-range planning of transportation improvements in the City, including the City’s Thoroughfare Master Plan. The Construction Management Group is responsible for the oversight and inspection of road, storm sewer, water and sanitary sewer capital projects. Duties generally include monitoring construction schedules and budgets, overseeing compliance with contract legal requirements, inspecting construction for conformance to project plans and technical specifications, and communication with members of the public affected by the construction project. All of the groups work extensively with other divisions and departments within the City as well as providing professional staff interface with organizations such as the Mid-America Regional Council (MARC), the Missouri Department of Natural Resources (MDNR), and the Missouri Department of Transportation (MoDOT).

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PUBLIC WORKS OPERATIONS The Public Works Operations Division maintains public infrastructure—the transportation network including City owned traffic signals, school flashers, street lights and the storm water collection system. During the winter months snow removal becomes the top priority. The Division falls within the Operations Group (with the Airport Division and Solid Waste Division) under the Deputy Director of Public Works. The Operations Division is divided into six main groups which include administration, stormwater, bridge and right-of-way, traffic, street maintenance, and capital pavement management. The administration group coordinates the budget and tracking of information and costs within the Division. An infrastructure management software program called Cityworks is utilized to track costs, evaluate efficiency, and manage performance. This group also administers the Adopt a Street program; all locations adopted are either a half mile or one mile in length. The street maintenance group performs pothole patching, pavement inspection (for the Overlay, Slurry seal and Crack seal programs) and maintenance on streets, alleys and City owned parking lots. The City currently has 1,029 lane miles of City owned pavement. The storm water group inspects, maintains, and repairs the 1,313,720 lineal feet of storm pipe as well as the 14,336 storm water structures currently in the system. The street sweeping program is also part of this group. The bridge and right-of-way group performs maintenance and repair on the 52 City maintained bridges as well as sidewalk maintenance, tree trimming, right-of-way mowing, weed spraying and litter pickup. The traffic group fabricates and installs street name signs, regulatory signs and warning signs throughout the City. They also perform paint striping on City owned parking lots and cross-walks. This group also performs maintenance and repair on 54 signaled intersections and 1500 City owned street lights, including 133 downtown street lights. This group also performs locates for any excavations in the vicinity of City owned signals and street lights. Capital pavement management is also administrated out of this division. The pavement management program includes crack seal, micro surface, ultra thin bonded wearing surface, overlay and curb replacement for 1,029 lane miles of City maintained roadway. MicroPaver software is currently being implemented to evaluate the roadway infrastructure based on current pavement inspections. MicroPaver once fully functional will identify priorities and trends in capital pavement management. Capital pavement management program also oversees the sidewalk gap and repair bond program. The city is responsible for over 350 miles of sidewalk.

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7: Special Revenue Funds General

City of Lee’s Summit Annual Budget FY15

Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than expendable trust or major capital project) requiring separate accounting because of legal or regulatory provisions or administrative action. The funds in this section are categorized as governmental fund type. The City’s Special Revenue Funds are as follows: PARKS AND RECREATION SPECIAL REVENUE FUNDS: Park Board (Parks & Recreation) — Accounts for activities of the Park Board, who administers operations of all City parks. Senior Center (Gamber Center) — Accounts for the activities of the Gamber Community Center. Swimming Pool (Aquatics) — Accounts for the activities of the municipal swimming pool operation. Community Center — Accounts for the activities of the Legacy Park Community Center operation. Cemetery Trust — Accounts for plot and monument sales for perpetual care funding.

OTHER SPECIAL REVENUE FUNDS: Business and Industry Fund — Accounts for and distributes the proceeds from a 5% tax on certain gross receipts of hotels, motels, and similar places of business. CDBG Entitlement Fund — Accounts for Community Development Block Grant (CDBG) federal funding passed through to other agencies. Violence Against Women Grant Fund – Accounts for federal monies used for the protection of women.

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PARKS AND RECREATION DEPARTMENT SPECIAL REVENUE FUNDS The Parks and Recreation Department is structured within six programs: Administration, Planning and Development, Operations and Construction, Grounds Maintenance, Legacy Park, and Beautification Commission. Within these programs, the department administers eight funds: five Special Revenue Funds, two Capital Project Funds (greenway and Neighborhood Development), and one Enterprise Fund (Harris Park Community Center). Descriptions and budgets for the Capital Projects and Enterprise Funds may be found in their respective sections of this document. The special revenue funds of the Parks and Recreation Department include: Parks & Recreation, Gamber Center, Swimming Pool, Community Center, and Cemetery Trust Funds. They are accounted for as special revenue funds and utilize Generally Accepted Accounting Practice (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due. Revenues susceptible to accrual are property taxes and interest revenue. Admission fees, user charges, concession sales and miscellaneous revenue are not susceptible to accrual.

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Parks & Recreation FY15 Revenues by Source 5% Charges for services Fines and forfeitures Intergovernmental Investment earnings

38%

50%

Material and fuel sales Other Sale of property Taxes Transfers in

1% 4% 2%

Revenues Charges for services Fines and forfeitures Intergovernmental Investment earnings Material and fuel sales Other Sale of property Taxes Transfers in Total

Parks & Legacy Park Harris Park Gamber Summit Cemetery Recreation Community Grand Total Community Center Waves Trust Fund Fund Ctr Ctr $ 2,500 $ 442,972 $ 1,812,444 $ 554,361 $ 86,950 $ 1,067,373 $ 3,966,601 20,250 20,250 750 750 5,000 400 400 7,000 250 13,050 8,530 6,198 88,074 80,256 6,500 189,558 110,268 8,300 15,025 1,930 137,670 273,193 99,000 99,000 3,018,000 3,018,000 93,285 175,000 24,000 25,000 59,414 376,699 $ 3,249,303 $ 634,802 $ 1,858,067 $ 669,765 $ 273,956 $ 1,271,207 $ 7,957,101

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Parks and Recreation FY15 Expenses by Type 5% 6%

Capital outlay

7%

Construction 3%

Depreciation Fuel and lubricants Interdepartment charges 22%

Interest Miscellaneous Other supplies, services and charges Personal services

52%

Repairs and maintenance Transfers out Utilities

Expenses Capital outlay Construction Depreciation Fuel and lubricants Interdepartment charges Interest Miscellaneous Other supplies, services and charges Personal services Repairs and maintenance Transfers out Utilities Total

Parks & Legacy Park Harris Park Gamber Summit Cemetery Recreation Community Community Center Waves Trust Fund Fund Ctr Ctr $ 130,000 $ 73,795 $ 322,503 $ 30,000 $ 11,750 $ 20,855 (189,364) 36,780 56,525 1,950 161,677 23,842 43,450 19,975 12,970 16,855 500 7,094 23,343 22,636 2,939 15,000 875,211 103,538 233,911 132,548 128,724 391,909 1,860,486 318,809 1,135,112 374,883 72,639 659,490 398,360 22,750 78,520 35,580 17,370 8,600 25,000 5,985 24,964 48,670 69,000 201,347 66,500 4,300 53,850 $ 3,373,659 $ 635,077 $ 2,037,978 $ 668,410 $ 274,667 $ 1,203,339

Grand Total $ 588,903 $ (189,364) $ 36,780 $ 58,475 $ 278,769 $ 500 $ 71,011 $ 1,865,840 $ 4,421,420 $ 561,180 $ 55,949 $ 443,667 $ 8,193,131

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Parks and Recreation Department Expenditures by Fund

15% Parks & Recreation

3% 41%

8%

Gamber Center Legacy Park Community Ctr Summit Waves Cemetery Trust Fund Harris Park Community Ctr

25% 8%

Fund Parks & Recreation Gamber Center Legacy Park Community Ctr Summit Waves Cemetery Trust Fund Harris Park Community Ctr Total

Actuals FY12 2,982,562 369,021 1,666,174 625,532 266,815 1,268,494 7,178,598

Actuals FY13 2,905,170 363,450 1,589,888 563,434 211,921 1,186,859 6,820,722

Prelim YE FY14 3,298,292 536,945 1,779,572 529,384 250,870 1,026,824 7,421,887

Adopted FY15 3,373,659 635,077 2,037,978 668,410 274,667 1,203,339 8,193,130

Difference from FY14 $ % 75,367 2% 98,132 15% 258,406 13% 139,026 21% 23,797 9% 176,515 15% 771,243 9%

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Parks and Recreation Department FTEs by Fund

20%

23%

Parks & Recreation Fund Gamber Center Legacy Park Community Ctr Summit Waves

8%

15%

Cemetery Trust Fund Harris Park Community Ctr 33%

Fund Parks & Recreation Fund Gamber Center Legacy Park Community Ctr Summit Waves Cemetery Trust Fund Harris Park Community Ctr Total

Actual FY13 26.15 10.57 39.55 17.73 1 21.98 116.98

Actual FY14 26.15 10.05 39.26 17.73 1 21.99 116.18

Adopted FY15 26.16 9.41 37.16 17.44 1 22.78 113.95

Change From FY14 to FY15 0.01 -0.64 -2.1 -0.29 0 0.79 -2.23

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Fund Balance Summary

Fund

Actual FY13

Budget FY14

Projected Balance FY14

Maintenance Balance FY15

Requested Balance FY15

Fund Balance Notes:

Gamber Ctr

269,667

319,295

330,232

408,352

Fund Balance Policy-15% of budgeted operating expenditures 329,957 ($95,490)

Legacy Park Community Ctr

547,250

727,941

734,008

876,599

554,096 ($306,262)

Harris Park Community Ctr

260,584

292,540

332,840

420,605

399,750 ($182,183)

1,556,225

1,319,536

1,335,803

1,738,676

37,430

13,682

45,036

1,162,580

1,179,704

Parks & Recreation Aquatics

(20,748)

Cemetery

1,158,300

1,160,662

Construction Funds

1,039,746

564,339

Park COP Debt Fund

670,226

581,468

(159,654) 637,532

Fund Balance Policy-15% of budgeted operating expenditures Fund Balance Policy-15% of budgeted operating expenditures Fund Balance Policy-15% of budgeted operating expenditures

1,210,601 ($508,504) **

Fund Balance Policy-15% of budgeted operating expenditures

15,036 ($100,350)

Trust fund set up to sustain operating costs once Cemetery at

1,161,929 capacity.

215,346

215,346 This fund is used for construction project tracking.

214,386

Fund used to record sales tax proceeds and pay outstanding debt for Certificate of Participation. Cash is transferred to the 214,386 Construction Fund for capital projects.

** The Fund Balance in Fund 200 will be maintained at the level that will cover minimum fund balances for Funds 201, 202, 530, and 203 in lieu of transferring cash to these funds.

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City of Lee’s Summit Annual Budget FY15 SUMMIT WAVES AQUATIC CENTER FUND

Summit Waves Aquatic Park is open from Memorial Day weekend through Labor Day and is located in Harris Park. The community wide family aquatics center contains a 6 lane, 25 yard lap pool with 2 diving boards, a zero depth entry pool with large play feature designed for toddlers, a 900+ foot action river, 1 open flume slide that can be used as a body slide or can be used to ride a single or double inner tube, and a closed flume body slide. Participants will also enjoy amenities including shade structures, lounges, family changing rooms, men’s and women’s locker rooms and a food and beverage operation that will offer items such as value meals, candy, drinks and breakfast items. The Aquatics fund is accounted for as Special Revenue funds and utilize Generally Accepted Accounting Principles (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due.

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City of Lee’s Summit Annual Budget FY15 CEMETERY TRUST FUND

The Cemetery Trust Fund was established to account for plot, niche and monument sales and to provide funding for the perpetual care of the Lee’s Summit Historical Cemetery. The Parks and Recreation Department oversees and maintains the city cemeteries on behalf of the City of Lee's Summit. The Cemetery Trust fund is accounted for as Special Revenue funds and utilize Generally Accepted Accounting Principles (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due.

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General 7: Special Revenue Funds

City of Lee’s Summit Annual Budget FY15 GAMBER CENTER FUND

The Gamber Center is designed to meet the recreational needs of the 50+ community. The facility also serves the community at large and consists of a ballroom (banquet seating for 200), bistro, billiards room, dry craft room, wet craft room, two fitness centers, aerobics studio, classroom (seating 25), and full kitchen. The design of the facility allows for flexibility in programming to accommodate new trends and technology. Participants will also enjoy outdoor amenities including a gazebo, raised planting beds, a walking path with 9 pieces of fitness equipment, outdoor seating for the bistro, and a manicured lawn for outdoor activities. The fund is a special revenue fund and utilizes Generally Accepted Accounting Practice (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due.

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City of Lee’s Summit Annual Budget FY15 HARRIS PARK COMMUNITY CENTER FUND

The Harris Park Community Center, with renovated additions, is now approximately 30,000 square foot. The recreation facility provides indoor recreational opportunities for all ages through a day camp for school age children held in the summer, holiday breaks from school and scheduled school days off, recreational athletic leagues, programs, instructional classes, special events, and rentals. The summer recreational day camp is for ages 5-11 and provides a wide variety of activities such as skating, bowling, field trips, guest speakers, swimming, etc. The Athletics program provides opportunities for youth such as volleyball, basketball and soccer leagues. Adults, male, female and coed, are served as well at the HPCC for basketball, volleyball, dodge ball or at the newly renovated Hartman Park softball field complex. Instructional classes provide a wide variety of educational and recreational opportunities for pre-school through adults that focus on basic instruction for the individual or family participation. The Special Events group increases cultural awareness by hosting a summer concert series to the community of Lee’s Summit free of charge. Staff from the Parks Department also serves as a liaison to the Arts Council working with a citizen group to research and provide cultural arts activities for the City. The fund is a special revenue fund and utilizes Generally Accepted Accounting Practice (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due.

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City of Lee’s Summit Annual Budget FY15 LEGACY PARK COMMUNITY CENTER FUND

The Community Center at Legacy Park opened in December 2003 and is approximately 58,000 square feet. The facility offers a fitness area with various fitness equipment, elevated running track, gymnasium (2 basketball or volleyball courts), 2 racquetball courts, an aerobics/fitness room, cycle studio, a natatorium with various aquatic features, and a child care area. The Center offers single visit passes, annual memberships, and Flex (monthly installment) memberships. Also available is a Passport membership which allows reciprocal use of Gamber Center and Legacy Park Community Center. Other fee based programs such as swim lessons, massage therapy, instructional and recreational opportunities for the multigenerational population are also available. A teen summer day camp is also offered at this facility. The strategic financial goal is to attain 100% operational cost recovery for the facility. The facility is funded by user fees, facility rentals and memberships. The fund is a special revenue fund and utilizes Generally Accepted Accounting Practice (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due.

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PARKS AND RECREATION FUND The Parks & Recreation fund is used to account for the maintenance of 30 municipal parks, which include recreational facilities for softball, baseball, soccer, tennis, picnics, walking/jogging, handball/racquetball, basketball and volleyball. Numerous playgrounds and all-purpose open space are also available to the citizens of Lee's Summit. The primary source of revenue is a 0.1630 cent property tax levied to support park operations. Five divisions are represented in the Parks fund including: Administration – this division provides leadership, coordination and support services including marketing, financial oversight, and overall support for the Parks and Recreation Board. Park Operations and Construction – this division provides maintenance of park grounds, equipment, buildings, special facilities, and construction and renovation of neighborhood parks. Neighborhood park planning and development services and construction are included in this program. City Grounds and Facilities Management – this program accounts for costs related to contracting with the City for turf and landscape maintenance of public buildings, medians, city parking lots, and islands. Legacy Park Management – this program provides maintenance for Legacy Park grounds, ball fields, equipment, concession buildings, pump house, lake and irrigation. Beautification Commission – this program accounts for costs associated with staff support and projects for the activities of the Beautification Commission. The Parks & Recreation fund is accounted for as Special Revenue funds and utilizes Generally Accepted Accounting Principles (GAAP) based budgeting. This requires that the modified accrual method is used to record revenues and expenditures. Revenues are recognized when susceptible to accrual (i.e. when they become measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to be used to pay liabilities when due.

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BUSINESS AND INDUSTRY FUND YEAR BEGINNING JULY 1, 2014 FY 2009 ACTUAL REVENUES: Business & Industry Tax (Hotel) Penalty/Interest Transfers Contributions Interest

$

Total Revenues EXPENDITURES: Administrative Fees Payment Discount Interest Expense Transfer Shop Lee's Summit Advertising Campaign Contributions Downtown Mainstreet Inc (DLSMS) Downtown Mainstreet Inc: Downtown Masterplan LS Economic Development Council LS Chamber of Commerce Arts Commission Historic Preservation Grant Community Branding

FY 2011 ACTUAL

FY 2012 ACTUAL

FY 2013 ACTUAL

FY 2014 FY 2015 BUDGET ESTIMATED CM Proposed

FY 2015 Adopted

351,854 $ (807) 0

311,027 $ 0 0

334,472 $ 0 62,220

297,045 $ 91 62,220

310,884 $ 0 62,220

320,941 $ 0 62,220

332,659 $ 0 62,220

328,504 $ 0 0

3,616

(114)

176

273

246

592

282

340

$

354,664 $

310,913 $

396,868 $

359,629 $

373,350 $

383,753 $

395,161 $

328,844 $

342,844

$

7,037 $ 6,556

6,221 $ 6,087 110

6,690 $ 5,898 13

6,293 $ 6,221 0

6,267 $ 6,194 0

6,297 $ 6,204 0

6,297 $ 6,204 0

6,298 $ 6,204 0

6,299 6,204 0

$

Total Expenditures

FY 2010 ACTUAL

Excess of Revenues Over (Under) Expenditures

328,504 0 14,000 340

0

0

0

0

0

0

0

0

0

30,000 102,000 279,200 75,700

24,130 102,000 224,569 40,780

60,000 0 250,916 40,780

60,000 0 250,911 50,700

60,000 0 250,911 50,700

60,000 0 250,911 50,700

60,000 0 250,911 50,700

52,122 0 217,968 44,043

59,122 0 217,968 51,043

0

0

0

0

0

0

0

0

500,493 $

(145,830)

403,897 $

364,297 $

(92,984)

32,571

374,125 $

(14,496)

374,072 $

374,112 $

(722)

9,641

374,112 $

21,049

326,635 $

2,209

340,636

2,208

Fund Balance, Beginning of Year

$

268,849 $

122,304 $

29,322 $

61,893 $

47,397 $

46,675 $

46,675 $

67,725 $

67,725

Fund Balance

$

123,020 $

29,322 $

61,893 $

47,397 $

46,675 $

56,316 $

67,725 $

69,934 $

69,933

% of Total Expenditures to Ending Fund Balance

24.6%

7.3%

17.0%

12.7%

12.5%

15.1%

18.1%

21.4%

The Business and Industry Tax fund was created to account for the license tax on certain gross receipts of hotels, motels and similar places of business, in an amount equal to 5% of gross daily rental receipts derived from transient guests for sleeping accommodations. The proceeds are used to promote the general economic welfare of the City including attraction and retention of business and industry to the community and the promotion and provision of facilities for tourism, conventions, and visitors. Businesses are allowed to deduct 2% processing fee if their tax is remitted before the 20th of the month. The 7 hotel/motels in the City have a total of 493 rooms with an average occupancy rate of 56% for fiscal years 2006, 2007, and 2008. Average Occupancy Rate:  FY09 - 50.7%  FY10 - 48.3%  FY11 - 55.7%  FY12 - 55.0%  FY13 - 57.8% Revenues: FY14 assumes growth of 1% from FY13 projections. Year to date, revenues are 1.6% above FY13 budget. Beginning in FY11, the City's general fund transfered $62k to the Business and Industry Fund to prevent a negative fund balance. These payments have continued and are included in the projections for FY14. Additionally, in FY 06, $525k was transferred from the general fund to the Business and Industry Fund for the Downtown Masterplan Improvements five-year implementation plan. FY 2009-10 reflects the last year of payment toward the Downtown Masterplan. This is shown under contributions in the amount of $102,000. Expenditures: FY14 assumes full funding of the general fund contribution and transfer to the B&I Fund. In FY12, contributions to the Chamber of Commerce increased to fund the 'Shop Lee's Summit' campaign. In FY11, funding for DLSMS services was revised to $60k following improvements implemented under the Downtown Masterplan.

REVENUES:

REVENUES, EXPENDITURES & FUND BALANCE

EXPENDITURES:

$450,000

Fund Balance

$400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $ACTUAL FY 2010

ACTUAL FY 2011

ACTUAL FY 2012

ACTUAL FY 2013

BUDGET FY 2014

ESTIMATED

CM Proposed FY 2015

Adopted FY 2015

FISCAL YEAR

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COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) ENTITLEMENT FUND YEAR BEGINNING JULY 1, 2014 FY 2010 ACTUAL REVENUES: Intergovernmental revenues: Contributions- Federal Other Total Revenues EXPENDITURES: Contributions expense Interest on Bonds Total Expenditures

FY 2011 ACTUAL

FY 2012 ACTUAL

FY 2013 ACTUAL

FY 2014 PROJECTED BUDGET

FY 2015 Requested

$

275,800 $

291,032 $

386,146 $

332,952 $

288,907 $

288,907 $

298,901

$

275,800 $

291,032 $

386,146 $

332,952 $

288,907 $

288,907 $

298,901

$

268,088 $ 410 268,498 $

291,816 $ 0 291,816 $

518,103 $

205,357

251,003 0

251,003 0

298,091 0

518,103 $

205,357 $

251,003 $

251,003 $

298,091

7,302

(784)

$

Excess of Revenues Over (Under) Expenditures

(131,957)

127,595

37,904

810

37,904

Fund Balance, Beginning of Year

$

(34,664) $

(27,362) $

(28,146) $

(160,103) $

(28,146) $

(28,146) $

9,758

Fund Balance

$

(27,362) $

(28,146) $

(160,103) $

(32,508) $

9,758 $

9,758 $

10,568

This fund was created to account for money received from the U.S. Department of Housing and Urban Development (HUD) under the Community Development Block Grant Program. The City "passes through" these funds to other organizations based on criteria established by HUD and the City Council.

REVENUES, EXPENDITURES & FUND BALANCE

REVENUES: EXPENDITURES:

$600,000

Fund Balance

$500,000 $400,000 $300,000 $200,000 $100,000 $$(100,000) $(200,000) ACTUAL FY 2010

ACTUAL FY 2011

ACTUAL FY 2012

ACTUAL FY 2013 FISCAL YEAR

BUDGET FY 2014

PROJECTED

Requested FY 2015

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VIOLENCE AGAINST WOMEN GRANT FUND YEAR BEGINNING JULY 1, 2014 FY 2012 ACTUAL

FY 2013 ACTUAL

FY 2014 PROJECTED BUDGET

FY 2015 Requested

REVENUES: Federal Contribution Interest

$

208,660 $ 356

225,093 $ 325

208,660 $

208,660 $

207,561

Total Revenues

$

209,016 $

225,418 $

208,660 $

208,660 $

207,561

$

175,785 $

42,543 $

175,778 $

175,778 $

175,778

$

175,785 $

42,543 $

175,778 $

175,778 $

175,778

EXPENDITURES: Program Expenses Interest Total Expenditures Excess of Revenues Over (Under) Expenditures

33,231

32,882

182,875

32,882

31,783

Fund Balances, Beginning of Year

$

(22,280) $

10,951 $

193,826 $

193,826 $

226,708

Fund Balances, End of Year

$

10,951 $

193,826 $

226,708 $

226,708 $

258,491

This fund was established to account for the revenue and expenditure pass through for the Violence Against Women Grant Program in conjunction with Hope House, Inc..

REVENUES, EXPENDITURES AND FUND BALANCE

REVENUES: EXPENDITURES:

$300,000 Fund Balances, End of Year

$250,000

$200,000

$150,000

$100,000

$50,000

$ACTUAL FY 2012

ACTUAL FY 2013

BUDGET FY 2014 FISCAL YEAR

PROJECTED

Requested FY 2015

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8: Capital Project Funds General

City of Lee’s Summit Annual Budget FY15

CAPITAL IMPROVEMENTS OVERVIEW A Capital Improvement Plan (CIP) is a major public infrastructure planning tool for many local governments. The CIP reflects the community’s assets, needs and goals, and is a statement of the City’s policies and projected financial ability to manage the physical development of the community. The development of a CIP matches information regarding planned public improvements with anticipated funding, and thus presents a systematic plan for providing the needed improvements within a prioritized framework. The City’s Charter mandates the development and annual review of a capital improvements plan and estimated operating and maintenance costs of the proposed improvements. The plan is formally adopted each year by the Planning Commission as part of the Comprehensive Plan. This approach addresses legal requirements for public hearings on the location, nature and extent of all projects. All costs identified for the first year of the plan are included in the City’s Operating Budget, which is adopted by the Mayor and City Council, for the upcoming fiscal year. The proposed five (5) year CIP for the City of Lee’s Summit sets the general schedule for which public improvements are proposed to be undertaken in that time frame. The CIP includes projects over $50,000 in total cost that are anticipated to be funded during the five-year period. Operating and maintenance expense information is provided for the first year of the plan when applicable. Annual maintenance programs, small projects and small planning studies, such as the street overlay program or system master plans, are typically included in the CIP as programs. A CIP is not a static document, but rather a fluid document that can be changed as the infrastructure requirements change, development occurs, and funding opportunities become available. The remaining four (4) years of the five-year plan represent all projects that are currently proposed for future funding based on the revenue projections. As priorities, needs and revenues change, projects may be added to or removed from the CIP. Estimated expenses and revenue projections are reviewed annually and adjusted if necessary to account for growth, inflation and other economic conditions. CAPITAL IMPROVEMENT PROCESS DEFINITION A capital improvement is a necessary or desirable project that extends or improves infrastructure and enhances the City’s ability to provide safe and desirable services for the benefit of the community and the quality of life in Lee’s Summit. These projects directly affect the way citizens live, travel and conduct business within the community. IDENTIFICATION The need for capital improvements may be identified by an adopted infrastructure master plan, the desire to maintain certain levels and types of service provided in the community, by community groups, or by regulatory legislation. Projects are prioritized based on many factors including their impact on

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providing better city services, accommodating city growth, effect on maintenance and operation expenditures, and the overall health, safety and welfare of the citizens. CREATION The scope of a proposed project is often determined based on a preliminary study or recommendations from other city master plans. Once the project is identified a preliminary cost estimate and schedule for the design, right of way and easement acquisition, and construction of the project is prepared. These initial cost estimates are typically general in nature with considerable contingencies included. If the project is selected for inclusion in the CIP, the estimates and schedule are the basis of the initial project information.

CAPITAL IMPROVEMENTS PLAN IMPLEMENTATION When a project on the CIP schedule is funded, it is assigned to a project manager who will assume oversight responsibilities. A number of steps are required before a project is complete. DESIGN The project manager will coordinate and participate in the selection process for an engineering or architectural design firm, as appropriate. Architectural and engineering services contracts, unlike commodities contracts, are awarded to firms strictly on the qualifications and expertise of the firm in the particular type of project. The project manager is responsible for negotiating a detailed scope and fee for the design services with the selected consultant. Design for some projects may be completed by City staff or awarded to consultants through annual on-call contracts. The design process is typically divided into several phases: concept and/or preliminary design, right-ofway plans, right-of-way appraisal and acquisition, and final design. Plans and cost estimates are prepared, either by the consultant or City staff, for review at least at these project milestones. If state or federal funding is involved, plans and estimates are also provided to the appropriate agency for review. As more refined information on project scope and cost is developed, the CIP document is revised accordingly during the next annual update. Occasionally, projects may be deferred or deleted from the plan based on information gathered during the design process that indicates significant problems with pursuing the project. Typically, one or more public meetings are held for major projects that have significant impacts on property owners and the public to obtain feedback and comments from the community. A meeting is often held at the completion of preliminary plans in order to let residents abutting the project know how the design will affect their properties. Comments made at the meetings are considered by City staff and the design firm for inclusion in revised plans, if appropriate, prior to appraisals and property acquisition. Other meetings may be held before any design is started and just before construction begins.

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Right-of-way plans define the nature and extent of property required to complete a project. Property acquisition may be in the form of right-of-way, permanent easements or temporary construction easements. The City hires professional appraisers to determine fair market value of the acquisitions, which is the basis for initial offers to property owners. The City’s right-of-way agent and/or contract agents complete the negotiation and acquisition process for the projects. Once all property is acquired, final plans and specifications can be completed. During this time, any necessary relocation of private utilities (gas, phone, power) is also accomplished. Typically, all relocations are complete prior to bidding a capital project. ADVERTISEMENT, BID AND AWARD Capital projects are publicly advertised through the City’s Purchasing Division. City and consultant staff members evaluate all bids for completeness and correctness, and references for the low bidder are checked. Based on the review and references, the consultant or the City’s project manager makes a recommendation for award to the lowest and best bidder. The award of the construction contract is made by City Council. SCHEDULE The construction contract sets forth the required completion time for the project. Time is counted from the date of the “Notice to Proceed” to the point of substantial completion and final completion. The duration is determined by the design consultant and/or City staff based on the scope of work, seasonal constraints, coordination with property owners, and impacts on the traveling public. The order and duration of specific tasks within the allotted contract time is typically determined by the contractor. The assessment of liquidated damages is included in construction contracts for failure to meet required completion dates. CONSTRUCTION ADMINISTRATION The City’s project manager for the design processor or a project manager from the construction management group is typically responsible for performing or coordinating project administration during construction. Such tasks generally include monitoring project progress, schedule and costs; coordinating and facilitating communications between the design consultant, inspections staff, contractor and City staff; negotiating and coordinating approval of changes in the project scope or cost; reviewing and approving regular progress payments; and reporting on the construction progress to City Council and the public through the City’s publications and website. Changes to the contract totaling up to five percent of the original bid price may be approved administratively by the appropriate Department Director. Changes that increase the cost in excess of that amount must be approved by the City Council. SUBSTANTIAL COMPLETION Substantial completion is defined as the time at which the project has progressed to the point where it is sufficiently complete that it can be utilized for the intended purpose. At this time, a comprehensive

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8: Capital Project Funds General

inspection is performed by City staff and the design consultant to create a list of all incorrect or outstanding items (a “punch list”) remaining to be completed or corrected. The punch list items and all other deficiencies must be completed before final acceptance of the project by the City, and final payment to the contractor. FINAL ACCEPTANCE Final acceptance is realized when the contractor has completed all work on the project, including punch list items, has provided the City with a maintenance bond, and has submitted all other close-out documents in accordance with the construction contract. The project manager is responsible for preparing a final project report and submitting it to city and department management staff as well as to City Council. Any unspent funds authorized for a project will be returned to the appropriate funding source for reallocation to future projects.

CAPITAL IMPROVEMENT PLAN FUNDING Revenue Sources All funding sources that may be used for various capital improvements are reviewed each year. Much of the work to develop the CIP focuses on the balancing of available resources with the identified capital needs. Consideration must be given to factors such as annual revenue projections from various sources, restrictions on the uses of certain funds, legal limitations on debt capacity, and City policies relative to project funding. The following is a list of existing funding sources and definitions for each: TAXES Property Tax- Revenue from the ad valorem tax levied on all real and personal property, based upon the assessed valuation established by the County Assessor on January 1st of each year. Real property assessed valuation is determined by applying the “market value” times the appropriate assessment ratios. As follows: • • • •

Commercial/Industrial: 32% Residential: 19% Agricultural: 12% Personal Property assessed valuation is set at 33% of market value and is determined by the State Tax Commission.

Sales Tax- The City imposes a total sales tax of 2.25% (Capital Improvement: 0.50%, General fund: 1.0%, Parks and Recreation: 0.25%, Transportation: 0.50%) on all goods and commodities sold within the City limits with the exception of drugs and farm machinery. The tax is also levied on all vehicles registered by residents of the City, regardless of where those vehicles were purchased. Transportation tax is not

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levied on utilities and is earmarked specifically for use in funding transportation projects only. The State of Missouri receives the tax from the respective business and distributes the funds monthly to the City. Parks & Recreation 1/4-Cent Sales Tax- Initially approved in November 1997 for 3/8-cent and renewed in February 2006 for ¼-cent, this revenue source is dedicated to Parks and Recreation improvements including completion of Legacy Park facilities, new park development, the Senior Center, and greenway development. Transportation ½-Cent Sales Tax- Approved initially in the 1980s, this tax is available to pay for transportation and traffic infrastructure improvements and major maintenance, such as overlay and slurry seal, curb and gutter replacement, crack sealing and pavement marking. This sales tax also provides funding for several other Public Works Programs including bridge rehabilitation, thoroughfare and traffic master plan studies, community bus services and the Neighborhood Traffic Safety Program. Capital Improvement ½-Cent Sales Tax- Originally approved in November 1997, this tax has been used in conjunction with the Road Excise tax to fund road improvements related to the “10-year road plan” adopted in 1997. The sales tax was renewed in April 2007 with collection beginning in 2008 and ending in 2018. This renewal of the sales tax will fund a second “10-year road plan” comprising 6 major projects. Road Excise Tax- Excise Tax is paid for development that generates new traffic in the City in the form of a license tax on building contractors. This revenue source is available for road improvements throughout the City that are required due to growth to at least some degree. The excise tax will continue to be used for the remaining projects from the first 10-year plan until it is complete. Transportation Development Districts A geographic area may be designated to levy an additional sales or property tax assessment to pay for transportation related infrastructure improvements.

Tax Increment Financing Provides for the capture of 50% of the Economic Activity Taxes (Sales and Franchise) generated within the boundaries of a designated area to be used to finance infrastructure improvements. All of the incremental increases in real estate taxes are also captured from all taxing jurisdictions until the infrastructure is paid off. BOND PROCEEDS General Obligation (G.O.) Bonds- Bonds which are backed by the full faith and credit of the City and require either a 2/3rds or 4/7ths voter approval. Limitations for bonding capacity are set by state statute. Revenue Bonds- Bonds which are backed by the fees and charges of a business-like government function, payable only from a specific source of revenue. Simple majority voter approval required.

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Limitations for bonding capacity are not set by state statute but rather the entity’s ability to repay the debt. Certificates of Participation- Bonds which are backed by general revenues or fees and charges of a government. No voter approval is required. Limitations for bonding capacity are determined by the market and the entity’s ability to repay the debt. Special Obligation Bonds- Bonds which are backed by general revenues or fees and charges of a government. No voter approval is required. Limitations for bonding capacity are determined by the market and the entity’s ability to repay.

GRANT FUNDING Grants may be received from federal, state or county governments. Grants are typically available for transportation, airport improvements, parks, and public safety equipment. The City also receives community development block grants (CDBG) for use in low-to-moderate income areas within the community. Equipment purchases and CDBG projects are not included in the CIP. FEES AND CHARGES Fees for direct receipt of public service by the parties who benefit from the service Landfill Tipping and Yard Waste Disposal Fees- Collected by Public Works Solid Waste Division for disposal of refuse or yard waste at the Resource Recovery Park. Parks and Recreation Activity Fees- Collected by Parks & Recreation Department for participation in various sports and recreation programs, aquatic instruction, and the Camp Summit and Club Summit daycare programs at the Recreation Center.

Recreation Memberships- Membership fees collected for the Lee’s Summit Pool and the Legacy Park Community Center. Water Sales- Charges for supplying water to residential, commercial, industrial and wholesale customers. Sewer Charges- Charges for providing wastewater collection and disposal services to residential, commercial and industrial customers. Sewer Tap- The charge for a new sanitary sewer connection based on the number of drains in a structure and assessed at the time of building permit issuance.

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City of Lee’s Summit Annual Budget FY15

Water Taps- The charge for a new water service connection based on the size of water meter required. Also included in the water tap fee is an amount which is intended to provide capital for the development of the City’s water transmission capacity. PRIVATE FUNDING Amounts paid by developers, generally for specific infrastructure improvements, pursuant to development agreements between the City and those developers.

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8: Capital Project Funds General

CAPITAL IMPROVEMENT PLAN COSTS

The 2015-2019 Capital Improvement Plan has been divided into eight major categories, plus the Public Works Programs. The total estimated cost of all projects included in the five-year plan is $296,055,000. A summary of the costs by category is summarized below. 2015-2019 CIP SUMMARY (Costs in $1000s)

Category PW & WU Programs Airport Bridgets, Streets, Signals Facilities Parks and Recreation Solid Waste Stormwater Sanitary Sewers Water TOTAL

Prior Yrs % of Total 2015-2019 % of Total N/A N/A 34,513.0 11.7 14,037 10.4 39,579 13.4 71,710 53.5 117,799 39.8 7,754 5.8 9,260 3.1 150 0.2 2,388 0.8 1,090 0.4 15,800 11.8 15,800 5.3 7,330 5.5 37,374 12.6 17,197 12.8 38,252 12.9 134,078 100.0 296,055 100.0

2015-2019 PW & WU Programs Airport Bridgets, Streets, Signals Facilities Parks and Recreation Solid Waste Stormwater Sanitary Sewers Water

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City of Lee’s Summit Annual Budget FY15

Summary of Capital Projects Project

# Todd George/50 Hwy TIF 6

Blackwell Rd Interchange

Prior Years' Funding

FY15 Funding

Lifetime Budget (CIP)

Future Years' Funding

1,324,365

6,070,000

14,011,635

21,406,000

1,324,365

6,070,000

14,011,635

21,406,000

2,531,813

738,000

113,187

3,383,000

Sewer Tap Fund 8

CC/WPL-SSES & I/I rehab-SwrCon

71

EPL Excess Flow Hold Bsn

24,273

0

1,225,727

1,250,000

146

SPL-Scruggs Rd PS EFHB

1,061,487

0

200,513

1,262,000

3,617,573

738,000

1,539,427

5,895,000

Water Construction 36

LS Rd-Colbern to City Lmt

912,000

0

0

912,000

67

Water Main Rehab FY12

933,431

0

433,569

1,367,000

68

Water Main Rehab Fy2011

1,303,914

0

875,086

2,179,000

11,951,129

0

1,048,871

13,000,000

144

Operation Facility-Site Acquis

155

SCADA Radio Communications

299,390

0

610

300,000

197

Wtr Main Rehab FY14-Chipmn&L

602,873

0

667,127

1,270,000

198

Wtr Main Rehab FY14-Wind,Lido,

1,043,875

0

20,125

1,064,000

199

Wtr Main Rehab FY14-Willow etc

1,124,761

0

38,239

1,163,000

205

Water Meter Replacement

340,865

400,000

1,259,135

2,000,000

18,512,239

400,000

4,342,761

23,894,000

132,728

0

326,272

459,000

Sewer Construction Fund 1

Arbores Pump Station

33

Lees Summit Rd Lift EFHB

11,386

0

138,614

150,000

69

Westview Sch SS Bank Stab

67,054

0

92,946

160,000

143

Tudor Pump Stn-Odor Contrl Sys

516,000

0

0

516,000

160

CC Wtrshd-CC16,CC20 Priv I/I R

578,047

0

5,953

584,000

191

San Sewer Rehab-CIPP Lining

-95,537

1,400,000

3,205,537

4,510,000

1,209,679

1,400,000

3,769,321

6,379,000

Bailey Road M291-Hamblen

3,074,462

0

5,204,538

8,279,000

22

Hook Rd--Ward Rd to 291

4,120,354

0

167,646

4,288,000

27

Jefferson-Persels/Stuart

8,574,208

0

1,139,792

9,714,000

36

LS Rd-Colbern to City Lmt

14,063,825

0

1,297,175

15,361,000

73

Chipman-Bent Tree/View Hi

456,584

0

9,184,416

9,641,000

30,289,433

0

16,993,567

47,283,000

Capital Imprvmt Sales Tax 4

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Summary of Capital Projects Project

# Road & Bridge Improvement 6

Blackwell Rd Interchange

Prior Years' Funding

FY15 Funding

Future Years' Funding

Lifetime Budget (CIP)

-168

894,000

168

894,000

343,496

0

6,504

350,000

1,703,209

0

56,791

1,760,000

10

Chipman/Commerce Dr Signl

26

Indep/Town Ctr Intersectn

38

Murray Road Bridge Replac

694,981

0

155,019

850,000

50

Second St Corridor Study

107,122

0

82,878

190,000

51

Second/Douglas Signal Rep

138,878

0

191,122

330,000

57

Third/Jefferson Signal Re

124,260

0

200,740

325,000

60

Traffic Sgnl Comm Mstr Pl

267,246

0

27,754

295,000

136

Pryor Rd Recon-Hook to M150

297,386

0

1,412,614

1,710,000

137

Second & Main Signal Replacmnt

346,000

0

14,000

360,000

273

Overlay & Slurry Seal FY15

-805,629

3,871,000

805,629

3,871,000

3,216,782

4,765,000

2,953,218

10,935,000

131,830

0

1,977,170

2,109,000

54,532

0

195,468

250,000

186,362

0

2,172,638

2,359,000

5,315,356

0

10,484,598

15,799,954

5,315,356

0

10,484,598

15,799,954

305,776

0

3,294,224

3,600,000

305,776

0

3,294,224

3,600,000

8,884,331

246,000

-284,142

8,846,189

8,884,331

246,000

-284,142

8,846,189

181,195

0

2,318,805

2,500,000

181,195

0

2,318,805

2,500,000

3,446,594

356,000

372,406

4,175,000

3,446,594

356,000

372,406

4,175,000

Park Development Fund 32 138

LeaMcKeighan Prk Renovatn Additional Dog Park

Storm Water Improvements 54

Stormwater Phase I

Arterial Street Lights II 2

Arterial Str Lights Ph II

Public Safety 2010 45

Police Facility Imprvmnts

Infrastructure Improv '10 53

Sidewalk Rehab Phase II

Road Improvements 2010 110

Strother Road-Road Imprv 2010

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City of Lee’s Summit Annual Budget FY15

Summary of Capital Projects Project

Prior Years' Funding

# Tudor Rd Improvemnts 2010 63

Tudor Road 2010

FY15 Funding

Future Years' Funding

Lifetime Budget (CIP)

8,260,267

0

2,882,733

11,143,000

8,260,267

0

2,882,733

11,143,000

Cultural Arts 2013 258

Legacy Pk Amphitheater Improvm

192,700

1,388,000

57,300

1,638,000

259

Cultural Arts Downtown Campus

-92,299

1,000,000

352,299

1,260,000

100,401

2,388,000

409,599

2,898,000

438,592

2,405,000

156,408

3,000,000

1,578,350

0

21,650

1,600,000

2,016,942

2,405,000

178,058

4,600,000

86,867,295

18,768,000

65,438,848

171,713,143

Road Improvements 2013 256

Orchard St Reconst-Dgls to Ind

257

Pryor Rd Shouldrs-Lgvw to Hook

Total of All Projects

CIP IMPACT ON OPERATING BUDGET As part of the Capital Improvement Plan, the impact of each project on the City’s operating budget is identified. As capital improvement projects are completed, operation and maintenance of these facilities must be absorbed into the appropriate department operating budget, which provides ongoing services to citizens. These operating costs, which may include salaries, equipment, regular maintenance, and repairs, are adjusted annually to accommodate growth and inflation in maintaining or improving service levels. In some cases, elimination of high-maintenance facilities may also reduce these operating costs. It is the City of Lee’s Summit’s philosophy that new projects should not be constructed if operating revenues are unavailable to cover the operating costs. These must be funded with recurring (ongoing) revenues. As a result, the availability of recurring revenues must be considered in the decision to include projects in the plan. The 2015-2019 CIP totals $296,055,000 (including funding from prior years), down from $305,761,000 in the 2014-2018 plan. The decrease in the total is due primarily to the completion of various projects previously included in the CIP. Significant changes to the CIP include:

Completed Projects

Lakewood Way & Bowlin Road signal 220 | P a g e


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• • • • • • • • • • • •

City of Lee’s Summit Annual Budget FY15

Pryor Road reconstruction – Hook to M150 2007 Sidewalk Improvements Third & Jefferson Signal replacement Arbores Pump Station Lee’s Summit Road Lift Station & EFHB Westview School sanitary sewer relocation WPL Watershed – Todd George Pump Station East Prairie Lee EFHB Additional Dog Park Bailey Farm Park Lea Mckeighan Park renovation Upper Banner Park renovation

Re-prioritized Projects • Outdoor Fitness Area at Police Department Deleted Projects • Cedar Creek Watershed Sanitary Sewer Project • Water Supply Alternatives • Tudor Pump Station – Odor Control System New Projects • Miller J. Fields Park Renovation (TBD) • Water Operations Facility Demolition (FY16) • Water Main Upsizing (FY15) • Water Supply Phase III (FY15) • Boggs Hollow EFHB Property Acquisition (FY15)

The following pages display a few detailed examples of the CIP’s impact on the operating budget.

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9: Proprietary Funds General

PROPRIETARY FUNDS

Enterprise Funds are used to account for operations that provide a service to the general public and are financed primarily by a user charge for the provision of such service. The city operates four enterprises: the Water/Sewer Utility, the Municipal Airport, the Sanitary Landfill, and the Recreation Center. Internal Service Funds are used to account for the financing of goods or services provided by one department to other departments of the City on a cost-reimbursement basis. The City has seven Internal Service Funds. The Central Vehicle Maintenance Fund and Management Information Systems Funds were established to provide replacement vehicles and data processing equipment and the related maintenance services to the various City departments. Unemployment Insurance Fund, Insurance Reserve Trust Fund, Short Term Disability, and Worker’s Compensation Self Insurance Fund were established to account for the City provided employee benefits. New in Fiscal Year 2007-2008 is the Central Building Services Fund. This fund will provide funding for capital maintenance projects. The City utilizes Generally Accepted Accounting Practice (GAAP) based budgeting for these funds. This requires that the full accrual method be used to record revenues and expenditures. This presentation records long-term assets and liabilities, and recognizes revenues and expenses when transactions occur.

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General Funds 9: Proprietary

City of Lee’s Summit Annual Budget FY15 CENTRAL BUILDING SERVICES

Central Building Services (CBS) is an internal services fund comprised of five service functions: Capital Project Management Services, Building Maintenance Services, Custodial Services, Utilities and General Services including the Building Equipment Replacement Program (BERP). The City Architect manages CBS. Capital Project Management Services focuses on new building project development such as the new Indoor Firing Range/Training Facility for the Police Department, as well as building or site renovation projects such as the renovation of the Police Department Detention Facility. The City Architect dedicates 75% of his time to provide design and construction oversight, while assisting the responsible department’s project team from concept through completion. The Building Maintenance Services staff includes 25% of the City Architects time as well as 2.25 FTEs. One staff member is a heating, ventilation and air conditioning (HVAC) technician. The services provided include routine maintenance, scheduled and unscheduled maintenance, repairs and general upkeep of facilities throughout the City. Specifically, they are responsible for maintaining City Hall, City Hall Parking Garage, all City fire stations, Animal Control, Public Works Maintenance Facility, Arnold Hall, Amtrak Station and downtown restrooms. Most maintenance related on-call contracts are administered as part of the services provided and includes elevator inspections, fire alarm inspections, window washing and carpet cleaning. Duty hours are from 6:30 AM to 3:30 PM, Monday through Friday. The Custodial Services staff includes 5.5 FTEs. The services typically include custodial and janitorial duties including floor care, trash disposal, recycling and detail cleaning of staff offices, restrooms and public spaces. Outside duties include snow and trash removal. 3 FTEs are assigned to City Hall/Parking Garage who work 3rd shift hours from 11:00 PM to 7:30 AM, Sunday night through Thursday night. 1 FTE is also assigned to City Hall/Parking Garage and 1 FTE is assigned to the Public Works Maintenance Facility and Animal Control working from 9:00 AM to 5:30 PM, Monday through Friday. 0.5 FTE is assigned to Fire Headquarters and the Municipal Court and works from 5:00AM to 9:00 AM. The Utilities and General Services program includes budget administration of all utilities for City Hall and Parking Garage. Specifically, natural gas, electricity, water/sewer and trash disposal is included. This program also administers the landscaping Memo of Understandings(MOU) for City Hall, Public Works Maintenance Facility and miscellaneous facilities. The Building and Equipment Replacement Program (BERP) collects and administers individual department BERP contributions. As replacement projects are scheduled for implementation, the City Architect will assist with procuring bids and completing the work. The City Architect will also perform facility inspections on an annual basis to evaluate BERP components.

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City of Lee’s Summit Annual Budget FY15 Central Building Services Statement of Cash Flow FISCAL YEAR: 2011-12 Actual

2012-13 Actual

2013-14 Estimated Budget

2014-15 Requested

2016-17 Projected

2015-16 Projected

2017-18 Projected

2018-19 Projected

2019-20 Projected

2020-21 Projected

Operating revenues: Charges for Service Other

1,249,523 1,305,816 41,011 41,391

1,308,893 37,807

1,308,863 37,807

1,364,692 0

1,107,874 0

1,144,998 0

1,184,926 0

1,227,919 0

1,274,268

1,324,286

Total operating revenues

1,290,534 1,347,207

1,346,700

1,346,670

1,364,692

1,107,874

1,144,998

1,184,926

1,227,919

1,274,268

1,324,286

518,788 76,378 241,525 67,970 158,668

601,486 205,881 297,640 67,100 127,125

591,870 86,831 276,300 67,100 122,968

556,925 84,800 252,578 68,840 100,665

568,064 101,534 257,630 57,280 123,367

579,425 101,534 283,393 57,280 123,367

591,013 101,534 311,732 57,280 123,367

602,834 101,534 342,905 57,280 123,367

614,890 101,535 377,195 57,280 123,367

627,188 101,536 414,915 57,280 123,367

1,070,642 1,063,329

1,299,232

1,145,069

1,063,808

1,107,874

1,144,998

1,184,926

1,227,919

1,274,268

1,324,286

47,468

201,601

300,884

0

0

0

0

0

0

1,302 0 0 0

4,316 0 0 0

4,595 0 0 0

6,725 0 0 0

7,197 0 0 0

7,197 0 0 0

7,197 0 0 0

6,892

6,590

Operating expenses Personal services Maintenance & repairs Utilities Depreciation Other

496,621 156,871 255,248 57,161 104,741

Total operating expenses Operating income (loss)

219,892

Nonoperating income (expense): Interest income Transfers Out Transfers In Gain (loss) on Disposal of Fixed Assets

4,496 0 110,147 0

Total nonoperating income (expense)

114,643

1,302

4,316

4,595

6,725

7,197

7,197

7,197

6,892

6,590

Net income (loss)

334,535

281,792

48,770

205,917

305,479

6,725

7,197

7,197

7,197

6,892

6,590

57,161 (318,754) (3,095)

67,970 0 8,967

67,100 (120,000) 0

67,100 (150,000) 0

0 (211,000) 0

Non-cash expense - Depreciation Capital outlay Increase (decrease) in assets & liabilities Increase (decrease) in working capital Cash at Beginning of Year Unrestricted cash and investments at the end of the year

283,878

(2,086) 0 0 0 (2,086)

(4,130)

57,280 (125,000) 0

57,280 (150,000) 0

57,280 (125,000) 0

(60,995)

57,280 (175,000) 0

(85,523)

(60,523)

(110,523)

57,280 (175,000)

(110,828)

57,280 (175,000)

(111,130)

69,847

358,729

123,017

94,479

793,389

863,236

1,221,965

1,221,965

1,344,982

1,439,461

1,378,466

1,317,943

1,232,421

1,121,898

1,011,070

863,236 1,221,965

1,217,835

1,344,982

1,439,461

1,378,466

1,317,943

1,232,421

1,121,898

1,011,070

899,940

Operating Revenue & Expense and Year End Cash 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0 Actual

Actual

2011-12

2012-13

Budget

Estimated 2013-14 Revenue

Requested

Projected

Projected

Projected

Projected

Projected

2014-15

2015-16

2016-17

2017-18

2018-19

2019-20

Expense

Year End Cash and Investments

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City of Lee’s Summit Annual Budget FY15 FLEET OPERATIONS FUND

The Fleet Operations Fund is an Internal Service Fund. Internal Service Funds are used to account for the financing on cost-reimbursement basis of goods or services provided by one department to other departments within the same governmental organization. The Fleet Operations Fund is comprised of two parts, first the Vehicle Replacement Fund (VERP) which provides motor vehicle fleet replacement services to the various City departments. All City motor vehicles are now owned by this fund. The departments then leases or rent their vehicles at a rate that will provide funds for the replacement of that particular piece of equipment at a scheduled future date. By charging a yearly rate with a technology multiplier, over the life of the equipment, this system enables the City to replace vehicles within efficient lifecycle time frame and not just when funds are available. This will provide all Departments with safe and efficient vehicles throughout the fiscal year while maintaining a steady yearly payment at much lower rates than direct replacement cost. The fund also allows for the ability to capture new technology allowing for lower fuel cost and reduced emissions output. The second part of the Fleet Operations Fund is the Overhead, this fund is comprised of cost for the daily operation which provides twenty four hour service to all using departments, Fleet Operations provides all maintenance and repairs to over four hundred pieces of equipment, and our mission is to provide the best service and staff by partnering with departments and vendors to effectively monitor and ensure the most cost effective repair and replacement of vehicles and equipment. With effectively monitoring repairs and maintenance schedules the Fleet Division is committed to providing the most cost effective service while recognizing the value of the ever changing field and capitalizing on changing technology. The overhead fund is provided by charging a weighted percentage of operational overhead costs based on a three year average of the work order hours generated by the using department. The established maintenance program has also yielded longer useful life and higher resale values.

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FLEET OPERATIONS Statement of Cash Flow FISCAL YEAR: 2011-12 Actual Operating revenues: Charges for Services Other Expansion Total operating revenues

2012-13 Actual

2013-2014 Estimated Budget

2019-20 Budget

3,134,369 1,545

3,165,712 1,545

3,065,495 1,545

2,475,687

2,433,359

3,062,237

3,104,881

3,135,914

3,167,257

3,067,040

583,250 119,126 42,715 3,325 169,034 2,388,481

590,406 114,562 37,200 3,575 179,648 1,698,469 2,492,850

587,558 114,065 37,200 3,518 158,497 1,698,469 1,947,955

640,006 120,179 37,200 6,123 162,385 2,064,823 2,348,982

645,100 120,179 37,200 3,598 172,530 1,659,216 1,990,527

651,551 113,294 38,535 3,598 172,530 1,659,216 1,889,350

658,066 113,294 38,535 3,598 172,530 1,659,216 2,867,310

664,647 113,294 38,535 3,598 172,530 1,659,216 3,668,162

677,940 113,294 38,535 3,317 172,530 1,659,216 3,157,486

3,305,931

5,116,710

4,547,262

5,379,698

4,628,350

4,528,074

5,512,549

6,319,982

5,822,318

(2,641,023)

(2,072,309)

(2,946,339)

(1,566,113)

(1,423,193)

(2,376,635)

(3,152,725)

(2,755,278)

37,911 (74,800) 0

39,880 (74,800) 0

2,537,844

Operating expenses Personal services Maintenance & repairs Utilities Fuel and Lubricants Miscellaneous Depreciation Capital Asset Closeout

559,030 132,531 47,932 3,482 157,665 2,311,886

Total operating expenses

3,212,526

Increase (decrease) in working capital

2018-19 Budget

3,103,336 1,545

2,715,234

Gain (loss) on Disposal of Fixed Assets Non Cash - Depreciation

2017-18 Budget

3,042,487 19,750

2,456,687 19,000

Total nonoperating income (expense) Net income (loss)

2016-17 Budget

2,432,609 750

2,532,574 5,270

Nonoperating income (expense): Interest income Transfers Out Transfers In

2015-16 Budget

2,456,687 18,266 0 2,474,953

2,696,171 19,063

Operating income (loss)

2014-15 Requested

(497,292)

(768,087)

19,222

25,216

5,530

2,875

19,000 0 0

57,789 0 0

61,593 0 0

65,751 0 0

65,323 0 0

61,449

24,752 (472,540)

28,091 (739,996)

(36,889) (2,677,912)

(34,920) (2,107,229)

19,000 (2,927,339)

57,789 (1,508,324)

61,593 (1,361,600)

65,751 (2,310,884)

65,323 (3,087,402)

61,449 (2,693,829)

258,110

705,780

418,343 1,698,469

369,734 1,698,469

609,878 2,064,823

609,878 1,659,216

533,966 1,659,216

566,153 1,659,216

653,320 1,659,216

489,695 1,659,216

(214,430)

(34,216)

760,770

831,582

(561,100)

(39,026)

(252,638)

(85,515)

(774,866)

(544,918)

Retained earnings, beginning of year

12,098,118

11,883,688

11,849,472

11,849,472

11,810,446

11,557,808

12,318,578

13,150,160

13,064,645

12,289,779

Unrestricted cash and investments at the end of the year

11,883,688

11,849,472

11,288,372

11,810,446

11,557,808

12,318,578

13,150,160

13,064,645

12,289,779

11,744,861

Operating Revenue & Expense and Year End Cash 14,000,000 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 Actual

Actual

2011-12

2012-13

Budget

Estimated 2013-2014

Revenue

Requested

Budget

Budget

Budget

Budget

Budget

2014-15

2015-16

2016-17

2017-18

2018-19

2019-20

Expense

Year End Cash and Investments

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City of Lee’s Summit Annual Budget FY15 INFORMATION TECHNOLOGY SERVICES

Information Technology Services’ (ITS) mission is to work in partnership with customers to leverage the use of information technologies to meet business challenges and to foster customer self-sufficiency in using those technologies. The functions managed by ITS are: Help Desk – Centralized and coordinated support is delivered via the ITS Help Desk. The Help Desk provides assistance with hardware, software, and phone systems to city staff. This group monitors the city computer environment and dispatches ITS staff to critical system and network events. Coordinates orders for equipment, manages employee computer system access, and provides internal computer training sessions. Network and Desktop Computer Operations – The city network has dedicated connections to 22 city facilities via fiber, a high speed wireless network and leased lines. Remote communication is provided for staff to connect externally via the Internet, as well as outbound access to the Internet for web and email, Jackson County system access and public safety networks (City of Kansas City, State of Missouri and NCIC). The wireless network has been expanded to laptops utilizing leased wireless cards for management team, public safety and other critical laptops utilized by city staff. The ITS supports and maintains network devices as well as the infrastructure of copper and fiber cables, circuits, hubs, routers, bridges and switches necessary to provide communications between these locations. Technology Planning and Internal Consulting – ITS staff works with departments to assess, define and identify needs and research, and develop and implement solutions to meet those demands. ITS Services Coordinators are assigned as a resource for the coordination of technical support services within each department. The coordinator assists with effectively and efficiently navigating ITS related processes and services and is the departments advocate in escalating service needs and evaluating new technology requests to meet business process needs. ITS Services Coordinator are knowledgeable about department’s unique business processes, strategic goals and objectives, and technology needs – and are empowered to provide assistance needed to succeed in technology-assisted endeavors. Applications Administration - ITS provides administration and end user support for all applications within the city. This group manages over 130 desktop, network, and AS/400 software products are used by the city departments. ITS provides the design, installation, configuration, vendor coordination, end user training and support, installation of upgrade, development of interfaces as required, and application troubleshooting. Application Administrators also serve as liaisons between end user and vendor by bridging the gap between technology and business process. Project Management - Project Management is the discipline of planning, organizing, and managing resources to bring about the successful completion of specific project goals and objectives. ITS developed and uses a defined Project Management Process to manage all project activities including: clearly defining the project’s scope, schedule, & cost; devising a solution to meet the requirements,

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including all people, process, technology, & support aspects; configuring or creating the desired solution; testing the solution and ensuring readiness for implementation; and implementing the solution and any required process changes. Project managers are responsible for ensuring successful execution of the process by controlling issues and risks, communicating project goals and status, and directing internal and external resources in executing tasks on the project timeline. Geographic Information Systems Administration - As the central coordinator of the city Geographic Information System (GIS), the ITS team provides management of the database, map layers, software and related components. ITS defines standards for GIS data and fulfills internal and external requests for data by providing maps and reports. GIS staff maintains the central GIS data to ensure maps are updated with accurate and timely information. The GIS staff continues to advance the integration of maps into city business to better support daily operations and decision making processes. Communications System Administration – Communication group is responsibility for supporting the phone and voice mail systems. The system includes over 600 phone voice/data lines and related equipment. These responsibilities include coordinating all phone related moves, additions and changes. In addition this group monitors and manages the phone related hardware and software located through city facilities. Communications also includes the email and calendar system utilized by employees to communicate and organize meetings with internal and external contacts. This includes the archiving of email communications and the filtering of unwanted spam emails. In addition this group manages the integration of mobile smart phones to provide city management instant access to email and calendars. Audio/Visual Services – The Local Government Access Channel broadcasted on AT&T, Comcast and Time Warner is managed by ITS. The channel provides information concerning local government activities, services and policies to the citizens of Lee’s Summit. The channel increases the public awareness of the activities of the legislative and administrative bodies of city government and other governmental entities. The channel is also used to facilitate emergency information to the general public. In addition the Audio Visual technology utilized throughout city facilities for meetings, digital signage, security and video production is supported by this central group. Depreciation - In accordance with GAAP-based budgeting, the ITS Fund includes a charge for the noncash depreciation expense to better match how much of the assets have been depreciated in a particular year. Although the capital outlay and bond principal redemption is a reallocation of current assets, an amount for these appear in this budget for informational and cash flow purposes only.

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City of Lee’s Summit Annual Budget FY15 OFFICE OF INFORMATION TECHNOLOGY Statement of Cash Flow FISCAL YEAR: 2011-12 Actual

2012-13 Actual

2013-14 Budget Estimated

2014-15 Budget

2015-16 Budget

2016-17 Budget

2017-18 Budget

2018-19 Budget

Operating revenues: Charges for Service Other

2,695,046 7,823

2,923,794

2,802,760 0

2,802,760 0

3,031,184 0

3,104,915 1,000

3,181,181 1,000

3,260,086 1,000

3,341,739 1,000

Total operating revenues

2,702,869

2,923,794

2,802,760

2,802,760

3,031,184

3,105,915

3,182,181

3,261,086

3,342,739

1,678,157 396,863 43,384 1,017 442,487

1,748,586 477,633 0 850 668,059

303,421

176,916

1,841,528 674,942 0 1,788 659,179 262,794 114,652

1,773,006 677,368 0 1,788 676,485 304,389 112,792

1,918,592 707,179 0 2,600 440,564 300,420 51,605

1,956,964 742,538 36,589 750 0 575,560 470,999

1,996,103 779,665 36,589 750 0 647,989 470,999

2,036,025 818,648 36,589 750 0 284,033 470,999

2,076,746 859,580 36,589 750 0 688,484 471,000

2,865,329

3,072,044

3,554,883

3,545,828

3,420,960

3,783,400

3,932,095

3,647,044

4,133,149

Operating expenses Personal services Maintenance & repairs Utilities Fuel and Lubricants Other Capital Equipment Depreciation Total operating expenses Operating income (loss)

(162,460)

(148,250)

(752,123)

(743,068)

(389,776)

(677,485)

(749,914)

(385,958)

(790,410)

Nonoperating income (expense): Interest income Gain (loss) on disposal of fixed assets Transfers In

11,276 0 400,000

10,405 0 206,978

30,000 0 86,846

30,000 0 86,846

17,460 0 0

30,000 0 200,000

30,000 0 200,000

30,000 0 200,000

30,000 0 200,000

Total nonoperating income (expense) Net income (loss)

411,276 248,816

217,383 69,133

116,846 (635,277)

116,846 (626,222)

17,460 (372,316)

230,000 (447,485)

230,000 (519,914)

230,000 (155,958)

230,000 (560,410)

114,652

112,792

216,988

470,999

470,999

470,999

470,999

Depreciation

Increase (decrease) in Cash

(520,625)

(513,430)

(155,328)

23,514

(48,915)

315,041

(89,411)

248,816

69,133

Cash at Beginning of Year

2,437,422

2,686,238

2,755,371

2,686,238

2,172,808

2,017,480

2,040,994

1,992,079

2,307,120

Unrestricted cash and investments at the end of th

2,686,238

2,755,371

2,234,746

2,172,808

2,017,480

2,040,994

1,992,079

2,307,120

2,217,709

Operating Revenue & Expenses and Year End Cash 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 Actual

Actual

2011-12

2012-13

Budget

Operating revenues:

Estimated 2013-14

Budget

Budget

Budget

Budget

Budget

2014-15

2015-16

2016-17

2017-18

2018-19

Operating expenses

Year End Cash and Investments

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City of Lee’s Summit Annual Budget FY15 Water Utilities

The Water Utilities Department serves over 35,000 customers. The total water supply has increased to 27.5 million gallons per day (MGD) with the completion of the third phase of the Jackson Cass Transmission Main with Kansas City. Lee’s Summit has contractual supply of 21 MGD from the City of Kansas City, Missouri and 7.5 MGD from the City of Independence, Missouri. Water demands increased considerably in the summer of 2012 due to hot and dry weather conditions. Water restrictions were enacted due to the failure of one of the major connections with Kansas City in July. Customer cooperation to alternate irrigation schedules allowed for storage levels to reach stable conditions and allowed for restrictions to be lifted. The City of Lee’s Summit and Little Blue Valley Sewer District have a contractual agreement for ongoing treatment and pumping within the Little Blue Valley drainage basin to accommodate existing and future customers within Lee's Summit. In order to maximize capacity of the sanitary sewer system, Water Utilities continues to focus on Inflow and Infiltration (I&I) reduction programs. The Water Utilities Department completed a Strategic Plan for the Utility in December of 2011, which was the result of a comprehensive assessment and strategic planning process involving the Utility’s stakeholders. The Plan specifically addressed a need to improve customer understanding and relations; to develop a program for the renewal of existing aged infrastructure; to establish appropriate policies to address financial challenges; and to proactively address long-term needs to ensure a sustainable utility. The Plan will also position the utility to be responsive to the impact of regulatory and economic factors that are affecting the utility today and in for the foreseeable future. In 2012 the Utility began implementing the Plan’s recommendations; the establishment of the Water Utilities Advisory Board to ensure customer input on the direction of the Utility; an online customer account system that offers ebilling and more details about their monthly bills; a new position to focus on community relations; and a financial plan including a rate schedule to support a sustainable utility.

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WATER SEWER OPERATING FUND Statement of Cash Flow FISCAL YEAR: 2011-2012 Actual OPERATING REVENUES: Charges for Services Material Sales Antenna Revenue Other Total Revenues OPERATING EXPENSES: Personal services Supplies for resale Other supplies, services and charges Repairs and maintenance Utilities Fuel and lubricants Depreciation Miscellaneous Interdepartmental charges Payment for G&A Additions to Contruction (Upsizing) Total Operating Expenses Net Operating Income/(Loss) OTHER INCOME (EXPENSE): Transfer from Other Funds Transfer to General Fund Transfer to Construction Funds Transfer to Other Funds Bond Proceeds Interest Income Principal Reduction Interest Expense Fiscal Agent Expense Amortization Total Other Expenses Net Income/(Loss) SRF Advances Acquisition & Construction Capital Equipment Non Cash Expense - Amortization Non Cash Expense - Depreciation Increase (decrease) in Working Capital

Unrestricted cash and investments at the end of the year

2012-13 Actual

2013-2014 Estimated Budget

27,741,435 62,285 129,538 322,526

29,504,776 87,193 156,981 447,132

29,467,491 57,952 131,751 433,710

30,749,547 87,045 130,642 447,799

31,828,042 70,810 132,000 451,492

34,286,349 60,293 137,074 419,906

36,103,742 61,499 139,815 428,304

37,480,166 62,729 142,611 436,870

38,345,621 63,984 145,463 445,607

28,255,785

30,196,082

30,090,904

31,415,033

32,482,344

34,903,622

36,733,360

38,122,376

39,000,675

3,487,916 12,466,204 2,183,922 395,614 596,326 124,264 4,258,678 16,610 456,358 1,129,555 -

3,474,054 13,158,329 2,131,612 401,472 536,264 123,488 4,181,935 14,935 527,129 651,522 -

3,960,732 13,270,805 2,572,601 635,866 641,250 140,021 4,325,083 11,300 513,965 651,522 -

3,775,150 14,012,267 2,416,653 607,588 565,150 136,776 4,298,601 11,775 513,965 651,522 -

4,033,255 14,445,278 2,675,267 510,279 591,300 140,408 4,384,573 16,425 637,140 651,522 -

4,222,487 14,141,234 2,697,026 661,564 768,588 154,381 4,370,607 11,759 534,738 677,845 -

4,365,101 15,104,063 2,766,715 674,807 837,376 162,102 4,458,019 11,997 545,437 691,402 -

4,516,375 16,109,802 2,839,068 688,313 912,333 170,210 4,547,179 12,239 556,349 705,231 -

4,677,066 17,268,960 2,914,248 702,087 994,013 178,723 4,638,123 12,486 567,480 719,336 -

25,115,447

25,200,740

26,723,145

26,989,447

28,085,447

28,240,229

29,617,019

31,057,099

32,672,522

3,140,338

4,995,342

3,367,759

4,425,586

4,396,897

6,663,393

7,116,341

7,065,277

6,328,153

10,550,490 (653,774) (5,230,037) (1,475,917) 63,078 (4,645,000) (602,541) (103,649) (65,832) (2,163,183)

1,744,037 (164,759) (6,904,118) (681,884) 33,113 (1,605,000) (365,461) (12,191) 675 (7,955,588)

554,229 (160,000) (4,028,823) (681,884) 13,000 (905,000) (132,450) (100,990) (2,500) (5,444,418)

554,229 (160,000) (4,028,823) (681,884) 13,000 (905,000) (132,450) (990) (4,320) (5,346,238)

536,038 (160,000) (8,965,111) (681,884) 10,900,000 35,000 (880,000) (123,400) (100,990) (4,320) 555,333

537,321 (160,000) (6,000,000) (809,432) 29,000 (1,451,358) (676,723) (1,030) (40,888) (8,573,110)

541,060 (160,000) (6,000,000) (823,621) 30,000 (1,480,385) (690,257) (1,051) (41,706) (8,625,960)

544,533 (160,000) (6,000,000) (838,093) 42,000 (1,509,993) (704,062) (1,072) (42,540) (8,669,227)

550,410 (160,000) (6,000,000) (852,855) 40,000 (1,540,193) (718,143) (1,093) (43,391) (8,725,265)

977,155

(2,960,246)

(2,076,659)

(920,652)

4,952,230

(1,909,717)

(1,509,619)

(1,603,950)

(2,397,112)

65,832 4,258,678

(675) 4,181,935

2,500 4,325,083

4,320 4,298,601

4,320 4,384,573

40,888 4,370,607

41,706 4,458,019

42,540 4,547,179

43,391 4,638,123

5,301,665

1,221,014

2,250,924

3,382,269

9,341,123

2,501,778

2,990,106

2,985,769

2,284,402

4,227,253

5,448,267

7,699,191

8,830,536

18,171,659

20,673,438

23,663,544

26,649,313

28,933,715

*

2014-2015 Requested

2015-2016 Projected*

2016-2017 Projected*

2017-2018 Projected*

2018-2019 Projected*

Operating Revenue & Expense and Year End Cash

45,000 40,000 35,000

'000's

30,000 25,000 20,000 15,000 10,000 5,000 Actual

Actual

2011-2012

2012-13

Budget

Estimated

2013-2014 Expenses

Requested

Projected*

Projected*

Projected*

Projected*

2014-2015

2015-2016

2016-2017

2017-2018

2018-2019

Revenue

Year End Cash and Investments

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General Funds 9: Proprietary

City of Lee’s Summit Annual Budget FY15 SOLID WASTE MANAGEMENT FUND

The Solid Waste Management Fund accounts for all revenues and expenses related to the City's Resource Recovery Park. The Resource Recovery Park, which operates on a six-day per week schedule, encompasses an area of approximately 275 acres including a 80 acre sanitary landfill, a four acre yard waste composting facility, a one acre drop-off recycling center, and a Household Hazardous Waste disposal area. An additional 80 acres of the site is set aside as a soil borrow area while the remainder of the property serves as a buffer from the abutting property owners. A Solid Waste Superintendent, Site Supervisor, ten full time employees, and two part-time employees staff the Solid Waste Division of the Public Works Department. Staff is responsible for day to day operations for municipal solid waste disposal, composting, brush collection and drop-off recycling. Household hazardous waste facilities and compost-loading facilities also enhance customer service. Staff must continue regular operations during all weather conditions; all possible efforts are expended to ease access to the different facilities. Customer service receives high priority in the Solid Waste Division. Customer awareness is provided through the distribution of recycling information and instructions for safe alternatives for disposal of hazardous household waste, recycling, solid waste and yard waste. Tipping fees for municipal solid waste, yard waste, and the sale of compost and mulch, generates fund revenue. Governed by state law, as well as City ordinance, yard waste cannot be placed in the sanitary landfill. Although no fees are charged for dropping off recyclables at the recycling center, the fund does generate limited revenue from the sale of specific recyclable items. This facility is subsidized from the Solid Waste Fund. A general and administrative fee is paid to the City's General Fund to recover indirect expenses incurred by General Fund staff, including the Public Works Engineering, Finance, Human Resources and Law Departments. The fee is calculated based upon General Fund Department usage. In accordance with GAAP based budgeting, the Solid Waste Management Fund is reported as an enterprise fund. The non-cash expense of depreciation/depletion is recorded to show how much of the facility has been consumed. Although capital outlay and bond principal redemption is a reallocation of current assets, amounts for these appear in this budget for informational and cash flow purposes only. The plan approved by the voters and City Council in 1994 provided for a 20-year life expectancy at 350 tons per day while maintaining suitable revenues sufficient to offset expenses. The sanitary landfill complies with applicable Federal Environmental Protection Agency and Missouri Department of Natural Resources regulations relating to closure/post closure.

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City of Lee’s Summit Annual Budget FY15

SOLID WASTE MANAGEMENT FUND Statement of Cash Flow FISCAL YEAR: 2014-2015 2010-11 Actual

2011-12 Actual

2012-13 Actual

2013-14 2014-15 Projected Requested

2015-16 Projected

2016-17 Projected

2017-18 Projected

Operating revenues: Charges for services Other

2,881,382 30,763

2,583,031 315,643

2,325,465 20,782

2,935,876 1,268

2,933,430 1,282

2,907,869 1,295

2,915,450 1,308

2,923,182 1,321

Total operating revenues

2,912,145

2,898,674

2,346,247

2,937,144

2,934,712

2,909,164

2,916,758

2,924,503

Operating expenses: Personal services Maintenance & repairs Utilities Fuel & lubricants Depreciation & Depletion Closure/postclosure expense Other

952,164 220,027 55,593 247,502 256,628 1,160,506 1,193,346

916,615 235,495 75,860 242,710 281,590 409,379 1,020,124

841,010 121,083 80,297 190,739 281,579 321,962 994,635

859,255 200,473 52,825 216,800 294,705 425,000 631,612

926,354 189,048 66,499 211,324 288,560 354,081 614,540

959,407 188,146 60,624 282,185 339,683 402,532 699,385

988,189 197,553 65,474 321,691 365,662 407,091 734,354

1,017,835 207,431 70,711 366,727 394,239 411,725 771,072

Total operating expenses

4,085,766

3,181,773

2,831,305

2,680,670

2,650,406

2,931,962

3,080,014

3,239,740

Operating income (loss) Nonoperating income (expense): Interest income Interest expense Gain on disposal of fixed assets Total nonoperating income (expense)

(1,173,621)

(283,099)

(485,058)

256,474

284,306

(22,798)

(163,256)

(315,237)

38,418 (22,872) 0 15,546

29,040 (23,859) 0 5,181

31,504 (36,301) 0 (4,797)

25,500 0 0 25,500

28,681 0 0 28,681

32,934 0 0 32,934

35,810 0 0 35,810

38,275 0 0 38,275

Net income (loss)

(1,158,075)

(277,918)

(489,855)

281,974

312,987

10,136

(127,446)

(276,962)

0 (578) 0 256,628 1,160,506 (155,129) (334,071)

0 (45,876) (175,000) 281,590 409,379 (133,398) 14,792

0 (182) (175,000) 281,579 321,962 (111,668) (23,423)

0 (94,454) (175,000) 294,705 425,000 (111,668)

0 (101,032) (175,000) 288,560 354,081 (111,668)

0 0 (175,000) 339,683 402,532 (113,913)

0 0 (175,000) 365,662 407,091 (115,052)

0 0 (175,000) 394,239 411,725 (116,202)

(230,719)

73,569

(196,587)

620,557

567,928

463,438

355,255

237,800

Principal repayment Capital outlay Transfer to Postclosure Trust Fund Non-cash expense - depreciation/depletion Non-cash expense - closure/postclosure Transfer to/from Other Funds Increase (decrease) in assets & liabilities Increase (decrease) in working capital Cash and investments at beginning of year

2,396,075

2,165,356

2,238,925

2,042,338

2,662,895

3,230,823

3,694,261

4,049,516

Unrestricted cash and investments at end of year

2,165,356

2,238,925

2,042,338

2,662,895

3,230,823

3,694,261

4,049,516

4,287,315

551,179

572,866

316,885

202,406

79,002

Operating income (loss) less depreciation and depletion

(916,993)

(1,509)

(203,479)

Operating Revenues & Expenses and Year End Cash

5,000,000 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 Actual

Actual

Actual

Projected

Requested

Projected

Projected

Projected

2010-11

2011-12

2012-13

2013-14

2014-15

2015-16

2016-17

2017-18

Revenues

Expenses

Year End Cash and Investments

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General Funds 9: Proprietary

City of Lee’s Summit Annual Budget FY15 AIRPORT FUND

The Airport Operating Fund is an enterprise fund that accounts for all revenues and expenses related to the municipally owned airport. The Lee's Summit Municipal Airport is designated by the Federal Aviation Administration (FAA) as a reliever airport for the Kansas City metropolitan area and as such is designed to reduce congestion at larger air carrier airports by providing general aviation pilots with alternate landing facilities. It is further classified as a general aviation utility airport serving planes with gross weights of less than 30,000 lbs. and landing speeds less than 121 knots. The airport is equipped with two runways: a 4,016 ft North/South (18-36), and a 3,800 ft Crosswind (11-29). Following recommendation in the 2010 adopted Airport Business Plan the City has initiated an engineering contract for services to provide the design work for the first phase of development involving the grading for a 1,285-foot extension to the south. This work is being performed with the assistance of federal and state aviation grants. In conjunction with the completed Preliminary Development Plan (PDP) for the eastside terminal area city staff has continued to work with several parties interested in developing facilities in this area. Airport fund revenues are generated through the sale of aviation fuel, navigational charts and pilot supplies, the leasing of 75 tie-down spaces, 40 open T-hangar spaces and 113 enclosed hangar spaces and six ground leases for privately owned hangars. Outstanding debt consists of an inter-fund loan from the General Fund. The inter-fund loan was used to refund prior debt issues that were at significantly higher interest rates. This inter-fund loan is being repaid on a monthly basis over the next five years at a fixed interest rate of 1%. The Airport Fund is accounted for as enterprise fund and utilizes Generally Accepted Accounting Principles (GAAP) based budgeting. This requires that the accrual basis of accounting method is used to record revenues and expenditures. Although capital outlay and bond principal redemption is a reallocation of current assets, amounts for these transactions appear in this budget for informational and cash flow purposes only.

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City of Lee’s Summit Annual Budget FY15

AIRPORT OPERATING FUND Statement of Cash Flow Fiscal Year: 2014-2015 2010-11 Actual Operating revenues: Charges for services (a) Fuel sales (b) Other Total operating revenues Operating expenses: Personal services ( c ) Maintenance & repairs Utilities (d) Fuels and lubricants (b) Other Total operating expenses Operating income (loss)

2011-2012 Actual

2012-2013 Actual

508,017 709,795 418,151

552,649 902,081 37,620

542,975 869,127 44,608

527,169 793,322 36,265

521,066 883,369 36,309

531,487 927,537 97,895

542,117 973,914 97,895

552,959 1,022,610 97,895

564,019 1,073,741 97,895

1,635,963

1,492,350

1,456,710

1,356,756

1,440,744

1,556,920

1,613,926

1,673,464

1,735,654

382,265 201,709 53,709 557,448 179,933

390,943 157,951 54,001 741,485 178,034

339,743 106,289 53,810 714,834 225,651

349,935 126,925 54,886 750,576 190,872

360,433 126,925 55,984 788,104 190,872

371,246 126,925 57,104 827,510 190,872

382,384 126,925 58,246 868,885 190,872

1,375,064

1,522,414

1,440,327

1,473,194

1,522,319

1,573,657

1,627,312

2013-14 Projected

326,485 172,819 53,529 718,613 139,792 1,411,238

2014-15 Requested

329,623 116,159 51,507 680,599 199,664 1,377,552

2015-16 Projected

2016-17 Projected

2017-18 Projected

2018-19 Projected

260,899

(30,064)

45,472

(20,796)

83,726

91,608

99,808

108,343

Depreciation expense Payment for general & administrative expense Forgiveness of general & administrative expense Cost/benefit analysis contribution from Gen. Fd Expense for cost/benefit analysis

(695,222) (78,861) 78,861 0 0

(577,036) (76,696) 76,696 0 0

(591,556) (76,696) 76,696 0 0

(553,591) (76,696) 76,696 0 0

(553,591) (76,696) 76,696 0 0

(546,169) (76,696) 76,696 0 0

(534,412) (76,696) 76,696 0 0

(533,911) (76,696) 76,696 0 0

(519,550) (76,696) 76,696 0 0

Operating income (loss) net of special items

(434,323)

(607,100)

(546,084)

(574,387)

(553,174)

(462,444)

(442,805)

(434,103)

(411,208)

Nonoperating income (expense): Interest income Interest expense (e) Gain on disposal of fixed assets Grant reimbursements (f) Local Match (h)

7,116 (51,615) 0 0

3,911 (47,014) 0 413,301

1,707 (49,362) 0 763,451 0

0 (21,552) 0 4,116,000 110,000

0 (44,974) 0 3,676,000 125,000

0 (3,811) 0 8,019,000 422,000

0 (2,636) 0 10,482,000 1,024,000

0 (1,449) 0 6,680,000 2,208,000

0 (301) 0 1,436,000 1,696,000

Total nonoperating income (expense)

(44,499)

370,198

715,796

4,204,448

3,756,026

8,437,189

11,503,364

8,886,551

3,131,699

Net income (loss)

(478,822)

(236,902)

169,712

3,630,061

3,202,852

7,974,746

11,060,559

8,452,448

2,720,491

Contribution From General Fund Principal repayment (e) Interest Construction funded in current year (g) Non-cash expense - depreciation (e) Proceeds from COP Capital Outlay - Equipment Intergovernmental loan Transfers in Transfers out Increase (decrease) in assets & liabilities

0 (45,000) 0 (390,429) 695,222 0 0 0 74,377 (84,861) 84,874

0 (45,000) 0 (440,568) 577,036 0 0 0 55,700 (83,308) (164,337)

0 (50,000) 0 (705,545) 591,556 0 0 0 57,000 (79,571) (6,042)

0 (109,488) 0 (5,526,000) 553,591 0 0 1,300,402 313,072 1,245 0

0 (115,779) 0 (2,501,000) 553,591 0 0 0 297,449 0 0

0 (119,303) 0 (8,888,000) 533,911 0 0 0 0 0 0

0 (70,146) 0 (3,132,000) 519,550 0 0 0 0 0 0

Increase (decrease) in working capital

(144,639)

(337,379)

(22,890)

162,884

1,437,113

260,422

Cash & investments at beginning of year

665,221

520,582

183,203

160,313

323,197

1,760,310

2,020,732

1,991,587

1,970,643

520,582

183,203

160,313

323,197

1,760,310

2,020,732

1,991,587

1,970,643

2,008,538

Unrestricted cash & investments at end of year:

417

0 0 (116,942) (118,117) 0 0 (8,441,000) (11,506,000) 546,169 534,412 0 0 0 0 0 0 297,449 0 0 0 0 0 (29,145)

(20,945)

37,895

Operating Revenue & Expense and Year End Cash 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 (500,000) (1,000,000) Actual

Actual

Actual

Projected

Requested

Projected

Projected

Projected

2010-11

2011-2012

2012-2013

2013-14

2014-15

2015-16

2016-17

2017-18

Revenues

Expenses

Year End Cash and Investments

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City of Lee’s Summit Annual Budget FY15

SHORT-TERM DISABILITY FUND YEAR BEGINNING JULY 1, 2014 FY 2010 ACTUAL

FY 2011 ACTUAL

FY 2012 ACTUAL

FY 2013 Actual

62,828

33,377

31,485

32,372

45,982

45,982

38,358

258

492

243

396

190

411

485

63,086 $

33,869 $

31,728 $

32,768 $

46,172 $

46,393 $

38,843

19,882 -

36,152 -

30,914

22,306

35,905 -

35,905 -

32,954 -

19,882 $

36,152 $

30,914 $

22,306 $

35,905 $

35,905 $

32,954

43,204

(2,283)

10,462

10,267

10,488

Fund Balance, Beginning o$

39,282 $

82,486 $

80,203 $

81,017 $

91,479 $

91,479 $

101,967

Fund Balance, End of Year $

82,486 $

80,203 $

81,017 $

91,479 $

101,746 $

101,967 $

107,856

FY 2014 BUDGETRELIMINARY YE

FY 2015 Proposed

REVENUES: Charges for services Transfers Interest Total Revenues

$

EXPENDITURES: Claims Other Total Expenditures

$

Excess of Revenues Over (Under) Expenditures

814

5,889

This fund was established to provide compensation to full-time City employees who are incapacitated and who have exhausted all paid time, but are not yet eligible for long-term disability benefits. Beginning July 1, 2009 the short-term disability policy was updated stating all earned time, including vacation and personal, must be exhausted before Short-term disability is available. The 2009-10 Actual claims of $19,882 represents the transition year, and it is anticipated claims will spike as paid time off is exhausted. The Fiscal Year 2014-15 contribution rate of $50 per Full-time Employee experienced no change from the Fiscal Years 2012-13 or 2013-2014 contribution rate. Interest revenues have been estimated at an average rate of 1% for fiscal year 2010-11 and 0.5% for fiscal year 2012-13. The target fund balance is 200% of paid claims.

REVENUES, EXPENDITURES & FUND BALANCE

Revenues Expenses Fund Balance

$120,000

$100,000

$80,000

$60,000

$40,000

$20,000

$FY 2010

FY 2011

FY 2012

FY 2013

FY 2014

FY 2015

FISCAL YEAR

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CLAIMS AND DAMAGES RESERVE TRUST FUND YEAR BEGINNING JULY 1, 2014 FY 2011 ACTUAL Revenues: Refunds Transfer in: General Fund Transfer in: Other Funds Interest Income Miscellaneous Total Revenues

$

Expenditures: Transfers Out Special Assessments Transfer Out Claims and Professional expenses Professional Fees Enterprise Resource Planning (ERP) Total Expenditures

$

Excess of Revenues Over (Under) Expenditures

FY 2012 ACTUAL

FY 2013 ACTUAL

BUDGET

FY 2014 PRELIMINARY YE

FY 2015 Proposed

10,485

75,000

75,000

150,000

150,000

150,000

5,883 -

655

820

350 -

350 -

433 -

75,655 $

75,820 $

150,350 $

150,350 $

150,433

16,368 $

120,898 1,500,000

41,724 -

113,252 -

150,000 -

150,000 -

150,000 -

1,620,898 $

41,724 $

113,252 $

150,000 $

150,000 $

150,000

33,931

(37,432)

350

350

433

0

0

0

(1,604,530)

Transfers: Transfer In: Excess Worker's Comp Fund Balance

0

Fund Balance, Beginning of Year

$

1,656,765 $

52,235 $

86,166 $

86,166 $

86,166 $

86,516

Fund Balance, End of Year

$

52,235 $

86,166 $

48,734 $

86,516 $

86,516 $

86,949

The Claims and Damages Reserve Fund accounts for expenses associated with liability and property claims. Claims from all City departments up to the City’s self insured retention of $50,000 per occurrence are paid from the fund. Funding is determined through loss history to cover anticipated claims and damages expenses each budget year. City departments contribute a baseline amount of $5,000 to the fund annually, which accounts for $75,000. The remaining amount, currently established at $75,000, is funded through claims history analysis. Each department with claims history for the past three years is assigned a prorata share of the remaining $75,000.00. This method assures contribution from all City departments while assessing risk costs appropriately based on actual losses incurred.

REVENUES, EXPENDITURES & FUND BALANCE

Revenues Expenses

$1,800,000

Fund Balance

$1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $ACTUAL FY 2011

ACTUAL FY 2012

ACTUAL FY 2013

BUDGET FY 2014

PRELIMINARY YE

Proposed FY 2015

FISCAL YEAR

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WORKERS COMPENSATION SELF-INSURANCE YEAR BEGINNING JULY 1, 2014 FY 2012 ACTUAL REVENUES: Other Revenue/Refunds Premiums Interest Transfers In Total Revenues

$

$

EXPENDITURES: Claims and Expenses Prior Year Claim Settlements Professional Fees and Administrative Costs Insurance (Excess and State Fees) Prior Period Adjustment Total Expenditures

$

Excess of Revenues Over (Under) Expenditures

FY 2013 ACTUAL

10,104 $ 404,603 11,363

8,570 $ 422,007 15,188 $

426,070 $

445,765 $

443,612 20,461 128,964

569,729 $ 239,204 40,055 117,627

593,037 $

966,615 $

(166,967)

(520,850)

BUDGET

FY 2014 PRELIMINARY YE

FY 2015 Proposed

FY 2016 Projected

FY 2017 Projected

FY 2018 Projected

488,974 $ 10,977 $ 499,951 $

488,974 10,977

895,591 3,338

895,591 3,338

895,591 3,338

895,591 3,338

499,951 $

898,929 $

898,929 $

898,929 $

898,929

649,616 $

649,616

651,462

32,696 151,511

32,696 151,511

40,000 214,956

675,795 50,000 32,696 151,511

675,795 50,000 32,696 151,511

675,795 50,000 32,696 151,511

833,823 $

833,823 $

906,418 $

910,002 $

910,002 $

910,002

(11,073)

(11,073)

(11,073)

(333,872)

(333,872)

(7,489)

Fund balances, Beginning of Year

$

1,689,374 $

1,522,407 $

1,001,557 $

1,001,557 $

667,685 $

660,196 $

649,123 $

638,050

Fund balances, End of Year

$

1,522,407 $

1,001,557 $

667,685 $

667,685 $

660,196 $

649,123 $

638,050 $

626,977

This fund was established to account for the monies necessary to self-insure the City's Workers Compensation claims. In January 2011, an actuarial analysis identified the following: - Self-insured retentions (beginning fund balance): FY 13-14 $643,918 (discounted reserves at 90% confidence, Bornhuetter-Ferguson technique*); - Funding (total revenues); discounted funding at 90% confidence); FY 10-11 $729,656, FY 11-12 $759,061, FY 12-13 $789,652; FY13-14 $649,616; FY14-15 $675,795 The continuing efforts to reduce frequency of claims and contain claim costs through negotiated discounts on medical expenses and using modified duty return to work resulted in lower overall damages and claims expense.Included in expenses is a line item for prior year claim expense. Professional Fees and Administrative Costs include state-required third party administrative fees and expenses for the discounted medical health provider network. The Insurance expense line includes the state required Self-Insurer Bond, Excess Insurance coverage Premium, Worker's Comp Tax and the 2nd Injury Fund Surcharge. Funding for upcoming and each year premiums (amounts assessed to departmental budgets) are adjusted to bring the fund balance in line with the projected retentions. Premium amount is divided into departments based on prior year's percentage of use. Premiums for fiscal year 2011-2012 increased $49,478 from the fiscal year 2010-2011 budget. No premium increase was budgeted for fiscal year 2012-2013. Interest revenues have been estimated at an average rate of 1% for Fiscal Year 2012 and .75% for fiscal year 2013. Beginning in FY15, Workers Compensation budget amounts were calculated to recover all projected costs. This was done to maintain the current fund balance and reserves.

REVENUES, EXPENDITURES & FUND BALANCE REVENUES: EXPENDITURES: Fund Balance

$1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $ACTUAL FY 2012

ACTUAL FY 2013

BUDGET FY 2014

PRELIMINARY YE

Proposed FY 2015

FISCAL YEAR

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City of Lee’s Summit Annual Budget FY15

UNEMPLOYMENT TRUST FUND YEAR BEGINNING JULY 1, 2014 FY 2013 ACTUAL

FY 2012 ACTUAL Revenues: Premiums Special Assessment Interest Total Revenues Expenditures: Claims paid Third Party Administrator Expense Total Expenditures

$

23,186 $

FY 2014 PROJECTED BUDGET $

922

751

22,202 $ 1,046

FY 2016 Projected

FY 2015 Projected

FY 2015 Proposed

FY 2017 Projected

22,202

25,823

25,823

25,823

25,823

1,046

483

483

483

483

$

23,937 $

922 $

23,248 $

23,248 $

26,306 $

26,306 $

26,306 $

26,306

$

27,656 $ 1,740

25,434 $ 1,305

26,999 $ 1,740

28,989 1,740

32,191 1,740

32,191 1,740

32,191 1,740

32,191 1,740

$

29,396 $

26,739 $

28,739 $

30,729 $

33,931 $

33,931 $

33,931 $

33,931

(5,491)

(7,481)

(7,625)

(7,625)

(7,625)

(7,625)

Excess of revenues over (under) expenditures

(5,459)

(25,817)

Fund balance, beginning of year

$

135,409 $

129,950 $

104,133 $

104,133 $

96,652 $

89,027 $

81,402 $

73,777

Fund balance, end of year

$

129,950 $

104,133 $

98,642 $

96,652 $

89,027 $

81,402 $

73,777 $

66,152

This fund was established to provide a self-insurance mechanism to fund liabilities related to unemployment claims filed by former City employees. Fiscal year 2014-15 maintains funding at $30 annually per employee and seasonal employees at $5 per month employed. Interest has been calculated for fiscal year 2014-15 at .5% on the fund balance at the end of the preceding fiscal year.

REVENUES, EXPENDITURES & FUND BALANCE Revenues Expenditures Fund Balance

$150,000 $125,000 $100,000 $75,000 $50,000 $25,000 $ACTUAL FY 2011

ACTUAL FY 2012

ACTUAL FY 2013

BUDGET FY 2014

PROJECTED

Proposed FY 2015

FISCAL YEAR

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10: Debt Service Funds General

DEBT SERVICE FUNDS The city utilizes three funds to record the receipt and disbursement of monies used to repay principal and interest charges on city issued debt. The following are the three funds used to record this activity: General Obligation Bonds, Northeast Tax Increment Financing (TIF) District Infrastructure Improvement Bonds, and Park Certificate of Participation (COP) Debt Fund. The General Obligation Debt Service Fund is used to account for the annual retirement of bonds issued from 2003 through 2010. Expenditures from this fund include the payment of interest and fiscal agent charges plus the scheduled repayment of the principal balance. The ad valorem tax on real and personal property provides the primary source of revenue to make these semiannual payments. Interest income on investments of the reserve amounts provides the remainder of revenue. The Park COP Debt Service Fund was established to account for the issuance of COPs related to Legacy Park, the Greenway Project, and the Senior Center. This fund receives the revenues generated by the one-fourth cent "Parks & Soils" sales tax. The Northeast Tax Increment Financing District Fund is where incremental property taxes (related to the improvements made on the property after the TIF district was formed) received on the designated parcels within the TIF district are used to make principal and interest payments on the city’s debt issued to construct streets and sanitary sewers in the district. The basis of accounting is the same for both budgeting and GAAP reporting purposes. This requires that the modified accrual method bases, with the revenues being recorded when measurable and available, and expenditures being recorded when the liability is incurred. Revenues susceptible to accrual are sales taxes, economic activity taxes, property taxes and interest revenue.

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10: Debt Service Funds General

GENERAL OBLIGATION DEBT SERVICE FUND YEAR BEGINNING JULY 1, 2014

FY 2010 ACTUAL REVENUES: Taxes (Net Bad Debt) Interest Penalty/Interest Refunds & Reimbursements Transfer In Total Revenues EXPENDITURES: County Collection Fees Debt Service: Principal Retirement Interest & Fiscal Charges Total Expenditures

FY 2011 ACTUAL

FY 2012 ACTUAL

FY 2015 Adopted

FY 2014 BUDGET

PROJECTED

$

7,902,073 $ 10,316 82,146

7,781,541 $ 63,179 36,487

7,601,638 $ 58,147 43,210

7,875,866 $ 64,180 48,885

7,853,358 $ 64,180 48,885

8,033,772 160,000 40,000

$

7,994,535 $

874,981 8,756,188 $

7,702,995 $

7,988,931 $

7,966,423 $

8,233,772

$

133,816 $

133,561 $

130,044 $

131,272 $

131,271 $

143,000

$

Excess of Revenues Over (Under) Expenditures

8,130,000 1,141,268

6,630,000 1,195,776

6,600,000 1,079,180

5,400,000 908,375

5,200,000 908,375

6,500,000 1,650,000

9,405,084 $

7,959,337 $

7,809,224 $

6,439,647 $

6,239,646 $

8,293,000

1,549,284

1,726,777

5,763,478 $

5,763,478 $

7,490,255

7,312,762 $ 7,490,255 $ 94,325 (22,508) 0.01212164 (0.00285784)

7,431,027 180,414 0.02297285

(1,410,549)

796,851

(106,229)

Fund Balances, Beginning of Year

$

6,483,405 $

5,072,856 $

5,869,707 $

Fund Balances, End of Year

$

5,072,856 $

5,869,707 $

5,763,478 $

DEBT SERVICE LEVY

2009-10 Actual

2010-11 Actual

2011-12 Actual

2012-13 Budget

2012-13 Estimated

(59,228)

2013-14 Estimated

Per $100 Assessed Valuation

$

0.4697 $

0.4697 $

0.4697 $

0.4697 $

0.4697 $

0.4697

Assessed Valuation

$

1,655,032,644 $

1,691,947,638 $

1,638,048,497 $

1,652,755,804 $

1,652,755,804 $

1,657,709,396

$ Growth

$

(84,826,982) $

36,914,994 $

(53,899,141) $

14,707,307 $

14,707,307 $

4,953,592

% Growth Allowance for Uncollectables

-4.88%

2.23%

-3.19%

0.89%

0.89%

0.30%

2.0%

2.0%

2.0%

2.0%

2.0%

2.0%

The General Obligation Debt Service Fund is used to account for the annual debt service on General Obligation (GO) bonds issued by the City. Expenditures from the fund include the payment of interest and fiscal agent charges plus the scheduled repayment of the principal balance. The ad valorem tax on Real and Personal Property provides the primary source of revenue to make these annual payments. Interest income on the reserve amounts provides the remainder of revenue. $5,000,000 of debt was issued in both December 2009 and December 2010. Additional debt issuance is anticipated in FY 2011-12 as authorized in the November 2007 election. $10,075,000 in bonds authorized but not yet issued will be issued over the next 2 years (not included in the above projections). $37.4 million of new bonds were authorized on November 2, 2010 and are anticipated to be issued over the next 3 years (also not included in the above projections). In April 2013, voters approved a $7.5m bond issue for a cultural arts campus and downtown street improvements. Interest Revenue has been calculated at an annual rate of 1% for Fiscal Year 2013-14 and .5% for 2014-15.

REVENUES, EXPENDITURES & FUND BALANCE Revenues

$10,000,000

Expenditures

$9,000,000

Fund Balance

$8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $ACTUAL FY 2010

ACTUAL FY 2011

ACTUAL FY 2012

BUDGET FY 2014

PROJECTED

Adopted FY 2015

FISCAL YEAR

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City of Lee’s Summit Annual Budget FY15

10: Debt Service Funds General

DEBT SERVICE REQUIREMENTS TO MATURITY GENERAL OBLIGATION BONDS PUBLIC SAFETY Radios & Design

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

CURBS

STREETSCAPE CITY HALL STORM WATERPUBLIC SAFETY Refunding Police Facilty Refunding 2013B 2013B 2013A 2013A

DATED 6/1/11

DATED 6/1/11

DATED 2/1/13

DATED 2/1/13

DATED 2/1/13

1,000,000 1,050,000

1,000,000 1,050,000 2,200,000 2,300,000

195,000 240,000 245,000 245,000 180,000 160,000 85,000 85,000 100,000 87,000

995,000 1,035,000 1,090,000 1,130,000 1,170,000 1,230,000 1,285,000 1,325,000 1,405,000 1,453,000

1,435,000 400,000 320,000 280,000 825,000 825,000 490,000 520,000 520,000

Pryor Road

Legacy Park

Outdoor Perf

2013A

2013A

2013A

2013C

2013C

2013C

2013C

2013C

DATED 2/1/13

DATED 2/1/13

DATED 2/1/13

DATED 10/24/13

DATED 10/24/13

DATED 10/24/13

DATED 10/24/13

DATED 10/24/13

325,000 1,260,000

595,000

655,000

380,000 405,000 415,000 440,000 470,000 495,000

260,000 260,000 260,000 255,000 365,000

$1,400,000

$1,585,000

$595,000

$655,000

3.00%-5.00%

2.00%-3.00%

2.00%

2.00%

CURBS

DATED 2/1/13

TUDOR ROADStrother Road Orchard Street

345,000 355,000 355,000 455,000 2,645,000 1,715,000

TOTAL

$2,050,000

$6,550,000

$1,622,000

##########

$5,615,000

2.00%-3.00%

2.00-3.00%

3.00-4.00%

3.00%-4.00

2.00%-3.00%

PAYMENTS FOR ALL GENERAL OBLIGATION BONDS PRINCIPAL INTEREST DURING FY

TOTAL

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

6,200,000 5,035,000 4,495,000 4,620,000 2,850,000 2,910,000 3,040,000 2,780,000 2,380,000 2,445,000 2,645,000 2,705,000 2,775,000 2,850,000 2,925,000

1,476,483 1,411,150 1,285,100 1,162,650 1,013,550 936,300 821,200 699,600 592,200 505,750 417,000 337,650 256,500 172,250 87,750

7,676,483 6,446,150 5,780,100 5,782,650 3,863,550 3,846,300 3,861,200 3,479,600 2,972,200 2,950,750 3,062,000 3,042,650 3,031,500 3,022,250 3,012,750

TOTAL

$50,655,000

##########

##########

$7,000,000

450,000

990,000

1,225,000 2,850,000 2,925,000

Interest Rates

City Hall

1,550,000

#########

$2,500,000

$2,000,000

$2,605,000

2.00%-3.00% 2.00%-3.00% 2.00%-3.00% 2.00%-3.00% 3.00%-5.00%

BALANCE @6/30 50,655,000 44,455,000 39,420,000 34,925,000 30,305,000 27,455,000 24,545,000 21,505,000 18,725,000 16,345,000 13,900,000 11,255,000 8,550,000 5,775,000 2,925,000 0

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10:General Debt Service Funds

City of Lee’s Summit Annual Budget FY15

City of Lee's Summit, Missouri Computation of Legal Debt Margin June 30, 2014 General Obligation Bonds Additional (2)

Ordinary (1) 0 11,123,000

City Hall 2013 (orig 2003) Downtown Streets 2013(orig 2003) Police Station Storm Water, 2013A Curbs 2011 Curbs 2013A Tudor Road 2013A Strother 2013A Cultural Arts Road Imp (Orchard & Pryor) Weather Radios ($75,000 Unissued) Tudor Road 2010 (7.37 Unissued) Storm Water, 2008 ($1.5 Unissued) Strother View High ($2.175 Unissued) Road Imp (Orchard & Pryor) (Unissued) Clutural Arts (Unissued)

1,427,000 8,050,000 4,180,000 5,550,000 4,360,000 2,500,000 2,000,000 1,260,000 4,005,000 75,000 7,370,000 1,500,000 2,175,000 595,000 63,000

Total Authorized

20,571,000

0

35,662,000

Total

0 11,123,000 1,427,000 8,050,000 4,180,000 5,550,000 4,360,000 2,500,000 2,000,000 1,260,000 4,005,000 75,000 7,370,000 1,500,000 2,175,000 595,000 63,000 0 56,233,000

General Obligation Debt by Project 1% 3%

City Hall 2013 (orig 2003)

4%

Downtown Streets 2013(orig 2003)

20%

Police Station

13%

3%

Storm Water, 2013A Curbs 2011

7% 2%

14%

4%

Curbs 2013A Tudor Road 2013A

4% Strother 2013A

7%

8% 10%

Total Authorized at 6-30-14 Unissued Total Issued and Outstanding

Cultural Arts

56,233,000 (11,778,000) 44,455,000

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10:General Debt Service Funds

City of Lee’s Summit Annual Budget FY15

City of Lee's Summit, Missouri Computation of Legal Debt Margin June 30, 2014 General Obligation Bonds Total

Additional (2)

Ordinary (1) Assessed Valuation (January 1, 2013) Constitutional debt limit

$1,658,441,780 $

General Obligation bonds payable includes authorized but unissued Less: Cash and Securities Available for Retirement Bonds Payable less Available Funds LEGAL DEBT MARGIN

$

165,844,178

165,844,178

331,688,357

20,571,000

35,662,000

56,233,000

2,479,785 18,091,215

4,298,970 31,363,030

6,778,755 49,454,245

147,752,963

134,481,148

282,234,112

Legal Debt Margin June 30, 2014 5%

10%

Additional Debt Margin Ordinary 85%

NOTES:

(1) Article VI, Sections 26 (b) and (c) of the State Constitution permits the City, by vote of two-thirds of the voting electorate, to incur an indebtedness for City purposes not to exceed 10% of the taxable tangible property therein as shown by the last completed assessment. (2) Article IV, Sections 26(d) and (e) of the State Constitution provides that the City may become indebted not exceeding in the aggregate an additional 10% for the purpose of acquiring rights-of-way, constructing, extending and improving streets and avenues and/or sanitary or storm systems, and purchasing or constructing waterworks, electric or other light plants, provided that the total general obligation indebtedness of the City does not exceed 20% of the assessed valuation. (3) The total assessed valuation shown above does not include state assessed railroad and utility properties.

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10:General Debt Service Funds

City of Lee’s Summit Annual Budget FY15

PARK CERTIFICATE OF PARTICIPATION DEBT SERVICE FUND YEAR BEGINNING JULY 1, 2014 FY 2010 ACTUAL Revenues: Sales Taxes Economic Activity Taxes (EATS) Interest Transfers In Total Revenues Expenditures: Transfer to Gamber Ctr (201) Transfer to General Fund Transfer to Greenway Fund Transfer to Park Dev (327) Debt Service: Principal Retirement Interest & Fiscal Charges Total Expenditures

FY 2011 ACTUAL

FY 2012 ACTUAL

FY 2013 Actual

$ 2,862,358 $ (331,991) 1,849 -

3,056,886 $ (377,262) 3,837 -

3,169,317 $ (394,228) 7,411 505,794

3,080,479 $ (14,229) 5,930 1,709,500

3,116,067 $ (132,978)

$ 2,532,216

$

2,683,461

$

3,288,294

$

4,781,680

$

2,983,089

$

175,000 500,000 1,465,000 677,380

$

157,500 1,650,000 618,724

$

175,000 1,000,000 161,250 1,050,000 548,484

$

175,000 750,000 161,250 600,000

$

$ 2,817,380

$

2,426,224

$

2,934,734

$

$

Excess of Revenues Over (Under) Expenditures

(285,164)

257,237

1,390,000 504,333

353,560

3,580,583

FY 2015 Adopted

FY 2014 PROJECTED BUDGET

1,201,097

3,182,772 $ (364,063) 6,345 -

3,362,797 (146,230) -

$

2,825,054

$

3,216,567

175,000 1,000,000 -

$

175,000 1,000,000 -

$

175,000 750,000 2,330,000 387,213

1,175,000

$

1,175,000

$

3,642,213

-

1,808,089

1,650,054

(425,646)

Fund Balances, Beginning of Year

$

838,763

$

553,599

$

810,836

$

1,164,396

$

1,164,396

$

1,164,396

$

2,814,450

Fund Balances, End of Year

$

553,599

$

810,836

$

1,164,396

$

2,365,493

$

2,972,485

$

2,814,450

$

2,388,804

The Park Certificate of Participation (COP) Debt Service Fund was established to account for the issuance of debt related to the acquisition of land and development of Legacy Park and Greenway Projects. This fund receives the revenues generated by the 1/4 cent "Parks & Soils" sales tax. This sales tax was reduced from 3/8 cent to 1/4 cent in April 2008 as approved by the voters. In 2006, the City issued debt relating to the new plan for the parks system, "Legacy for Tomorrow and Beyond." The amount of money required for debt service on the 2006 COPs during the current fiscal year is retained in this fund, and monies in excess of that amount may be transferred to the city park construction funds. Interest earnings are calculated at 1% for Fiscal Year 2013-14 and .5% for 2014-15, based on the retention in this fund of only the monies required for the current year's debt service with all additional amounts being transferred to the City Park Fund 057.

REVENUES, EXPENDITURES & FUND BALANCE

Revenues

$5,250,000

Expenditures Fund Balance

$4,500,000

$3,750,000

$3,000,000

$2,250,000

$1,500,000

$750,000

$ACTUAL FY 2010

ACTUAL FY 2011

ACTUAL FY 2012

Actual FY 2013 FISCAL YEAR

BUDGET FY 2014

PROJECTED

Adopted FY 2015

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Appendix

General

Accrual Accounting: A method of accounting that recognizes the financial effect of transactions, events and inters fund activities when they occur, regardless of the timing of related cash flows. Amortization: 1) A reduction of debt by means of periodic payments sufficient to meet current interest and liquidate the debt at maturity. 2) Provision for the extinguishment of a debt by means of a debt service fund. 3) Accounting for expenses or charges as they apply rather than as they are paid. Arbitrage: Arbitrage is the difference (profit) earned from investing low- yielding tax-exempt bond proceeds in higher yielding taxable securities. Assessments: Assessments are charges in the nature of taxes upon property owners to pay the costs of facilities or improvements that benefit the property owned. Payment of the amount assessed (together with interest if not paid upon assessment) is secured by a direct fixed lien on the property. The assessed payments are either used directly to pay the costs of the facilities or improvements or, if paid over time, are used to repay bonds issued to finance such costs. “Special assessment” financing proceeds are used for improvements relating to the property, such as sidewalks, streets, gutters, sewers and water systems. Assessed Valuation or [AV]: The valuation placed on real estate or other property by a government for the purpose of levying taxes.

City of Lee’s Summit Annual Budget FY15

Auditing: Pre-Audit: Posting year-end closing entries, preparing preliminary financial statements and assembling supporting documents for review by outside auditors. Auditing: Post-Audit: Posting audit adjustments and preparing the annual financial report. Audit Report: The report prepared by an auditor covering the audit or investigation of an entity’s financial position for a given period of time. As a general rule, the report should include a) a statement of the scope of the audit; b) explanatory comments concerning exceptions from generally accepted auditing standards; c) opinions; d) explanatory comments concerning verification procedures; e) financial statements and schedules; and f) statistical tables, supplementary comments and recommendations. The auditor’s signature follows item c) or d). Authority: A governmental unit or public agency created to perform a single function or a restricted group of related activities. Usually such units are financed from service charges, fees and tolls, but in instances they also have taxing powers. An authority may be completely independent of other governmental units, or in some cases it may be partially dependent upon other governments for its creation, its financing or the exercise of certain powers. Balanced Budget: Annual financial plan in which expenses do not exceed revenues. Bond Counsel: Legal firm hired to advise the Issuer regarding the legal and tax assurance to the bond purchaser that the bond was legally issued and is aspects of the sale. Bond counsel writes the legal opinion for the bond issue. This lawyer, in theory, represents the ultimate bond purchaser. The Bond opinion provides tax-exempt. Generally

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City of Lee’s Summit Annual Budget FY15

responsible for producing the legal documents required for the sale.

is preliminary and tentative or whether it has been approved by the appropriating body.

Bond Election or Bond Referendum: A process whereby the qualified voters of a governmental unit are given the opportunity to approve or disapprove a proposed issue of municipal securities. An election is most commonly required in connection with general obligation bonds. Requirements for voter approval may be imposed by constitution, statute, or local ordinance.

Callable Bond: A bond which the issuer is permitted or required to redeem before the stated maturity date at a specified price, usually at or above par, by giving notice of redemption in a manner specified in the bond contract.

Bond Fiscal Year: The 12-month accounting period, established under some bond contracts, used in connection with and issue of municipal securities. Principal and interest payments are scheduled in accordance with the bond fiscal year. The bond fiscal year may not necessarily coincide with the issuing agency’s own fiscal year, and may be established in order to take full advantage of the scheduled cash flow of projected pledged revenues. (See also Fiscal Year).

Call Feature (Redemption Feature): Enables the Issuer to pay off “redeem” a bond prior to its maturity date. The “call date” is the earliest date the bond may be redeemed “called”. Usually a premium is paid for the earliest call dates.

Bond Proceeds: The money paid to the issuer by the purchaser or underwriter of a new issue of municipal securities. These monies are used to finance the project or purposed for which the securities were issued and to pay certain costs of issuance as may be provided in the bond contract. Budget (Operation): A plan of financial operation embodying an estimate of proposed expenditures for a given period and the proposed means of financing them. Used without any modifier, the term usually indicates a financial plan for a single fiscal year. The term “budget” is used in tow senses in practice. Sometimes it designates the financial plan presented to the appropriating body for adoption and sometimes the plan finally approved by that body. It is usually necessary to specify whether the budget under consideration

Call Date: The date on which a bond may be redeemed before maturity at the option of the Issuer.

Capital Assets: Assets of significant value and having a useful life of several years. Capital Assets are also called Fixed Assets. Capital Improvement Program [CIP]: A plan of proposed capital expenditures and the means of financing them. The capital budget is usually adopted as part of the complete annual budget which includes both operations and capital outlays. The capital budgets should be based on a capital improvement program [CIP]. Capital Outlays: Expenditures for the acquisition of capital assets. Capital Projects: Projects that purchase or construct capital assets. Typically a capital project encompasses a purchase of land and/or the construction of a building or facility. Cash Basis: The method of accounting under which revenues are recorded when received and expenditures are recorded when paid.

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General Appendix Cash-Flow Budget (Cash Budget): A projection or the cash receipts and disbursements anticipated during given period. Typically, this projection covers a year and is broken down into separate projections for each month, week and/or day during the year. Cash-Flow Financing: A financing in which the proceeds of the issue are used to pay current expenses of the issuer when the issuer’s current income is temporarily insufficient for that purpose. Also, sometimes called TRANS, TANS, or RANS (tax and revenue anticipation notes). The issue is customarily scheduled to be repaid when current income exceeds current expenses. The issue typically has a term of one year or less. Cash Management: Tracking and forecasting cash flow, and working with investment personnel to develop an investment plan. Maintaining cash accounts and controlling their disposition. Coordinating and controlling bank accounts. Certificate of Deposit or CD: A negotiable or nonnegotiable receipt for moneys deposited in a bank or other financial institution for a specified period at a specified rate of interest. Certificate of Participation [COP]: A certificate showing participation through ownership of a “share” of lease payments or lease-purchase agreement. Usually made between a municipality and an equipment vendor. While these certificates are similar to bonds, they are secured solely by the lease or rental revenues accruing to the municipality/agency issuing the certificates have maturities and are paid in a manner parallel to the process involved in the execution and administration of bonds. Competitive Bid or Competitive Bidding: A method of submitting proposals to purchase a

City of Lee’s Summit Annual Budget FY15 new issue of bonds by which the bonds are awarded to the underwriting syndicate presenting the best bid according to stipulated criteria set forth in the notice of sale. Cost Accounting: Accounting which assembles and records all costs incurred to carry out a particular activity or to deliver a particular service. Costs of Issuance: The expenses associated with the sale of new issue of municipal securities, including such items as underwriter’s spread, printing, legal fees and rating costs. Covenant or Bond Covenant: The issuer’s enforceable promise to do or refrain from doing some act. With respect to municipal bonds, covenants are generally stated in the bond contract. Debt: An obligation resulting from the borrowing of money or from the purchase of goods and services. Debt of governmental units include bonds, time warrants, notes, and floating debt. Debt Limit: The maximum amount of debt which an issuer of municipal securities is permitted to uncurl under constitutional, statutory or charter provisions. The limitation is usually a percentage of assessed valuation and may be fixed upon either gross or net debt. Debt Ratios: Comparative statistics showing the relationship between the issuer’s outstanding debt and such factors as its tax base, income or population. Such ratios are often used in the process of determining credit quality of an issue, especially in the case of general obligation bonds. Debt Service: The amount of money necessary to pay interest on an outstanding debt, the serial meteorites of principal for serial bonds and the 280 | P a g e


General Appendix

City of Lee’s Summit Annual Budget FY15

required contributions to an amortization of sinking fund for term bonds.

appropriation and for which a part of the appropriation is reserved.

Debt Service Fund: A fund established to account for the payment of interest and principal on all general obligation debt.

Enterprise Activity: A revenue- generating project or business which supplies funds necessary to pay debt service or bonds issued to finance the facility. The debts of such projects are selfliquidating when the projects earn sufficient moneys to cover all debt service and other requirements imposed under the bond contract.

Debt Service Schedule: A table listing the annual payments necessary to meet debt service requirements over the period of time the bonds are to be outstanding. Defeasance: Termination of the rights and interests of the bondholders and of their lien on the pledged revenues in accordance with the terms of the bond contract for the prior issue of bonds. Defeasance usually occurs in connection with the refunding of an outstanding issue before the final payment, or provision for future payment, of principal and interest on a prior issue. Delinquent Taxes: Taxes remaining unpaid on and after the date on which a penalty for nonpayment is attached. Depreciation: 1) Expiration of the service life of capital assets attributable to wear and tare, deterioration, action of the physical elements, inadequacy or obsolescence. 2) That portion of the cost of a capital asset that is charged as an expense during a particular period. Direct Debt: The debt for which the issuing unit has sole responsibility.

Enterprise Debt: Debt which is to be retired primarily from the earnings of publicly owned and operated enterprises. Enterprise Fund Accounting: Accounting used for government operations that are financed and operated in a manner similar to business enterprises and for which preparation of an income statement is desirable. Expenditures: Where accounts are kept on the accrual or modified accrual basis of accounting, the cost of goods received or services rendered whether cash payments have been made or not. where accounts are kept on a cash basis, expenditures are recognized only when the cash payments for the above purposed are made. Expense: Charges incurred (whether paid immediately or unpaid) for operations, maintenance, interest or other charges.

Disbursements: Recording accounts payable, reviewing invoices and supporting documents, and making payments to vendors.

Feasibility Study: A report of the financial practicality of a proposed project and financing thereof, which may include estimated of revenues that will be generated and a revenue of the physical operating, economic or engineering aspects of the proposed project.

Encumbrances: Obligations in the form of purchase orders, contracts or salary commitments which are chargeable to an

Federal National Mortgage Association (FNMA) or Fannie Mae): One of the two presently existing corporations which formerly comprised the 281 | P a g e


General Appendix FNMA. As it currently exists, FNMA is a government- sponsored private corporation authorized to purchase and sell mortgages and to otherwise facilitate the orderly operation of a secondary market for home mortgages. Financial Advisor or Consultant: With respect to a new issue of municipal bonds, a consultant who advises the issuer on matters pertinent to the issue, such as structure, timing, marketing, fairness of pricing, terms and bond ratings. Can provide cash management services and can serve as an agent for the issuer during the pricing of bonds during a negotiated sale. Fiscal Agent: An agent (usually and incorporated bank or trust company) designated by a government to act for it in any of several capacities in the sale, administration and payment of bonds and coupons. Fiscal Policy: a government’s policy relating to budgeting of expenditures and revenues. Fiscal Year: A 12-month period of time to which the annual budget applies and at the end of which a governmental unit determines its financial position and the results of its operations. Fixed Asset Management: Tagging and preparing asset ledgers for plant, facilities, and equipment; recording changes in asset status; and conducting periodic inventories of assets. Full Disclosure: Providing accurate and complete information material to a bond issue, which a potential investor would be likely to consider important in deciding whether to invest. Material facts that enable the investor to evaluate the credit quality of an issue. Full Faith and Credit: A pledge of the general taxing power for the payment of debt obligation.

City of Lee’s Summit Annual Budget FY15 Bonds carrying such pledges are usually referred to as general obligation bonds or full faith and credit bonds. Full Time Equivalents [FTE]: Equal to one person based on a 2080 hours a year. Fund: An independent fiscal an accounting entity with a self- balancing set of accounts recording cash and/or other resources together with all related liabilities, obligations, reserves, and equities which are segregated for the purpose of carrying on specific activities or attaining certain objectives. Fund Balance: The excess of the assets of a fund over its liabilities, reserves, and carryover. General Fund: The largest governmental fund, the General Fund accounts for most of the financial resources of the general government. General Fund revenues include property taxes, licenses and permits, local taxes, service charges, and other types of revenue. This fund usually includes most of the basic operating services, such as fire and police protection, finance, planning, codes administration, public works and general administration. General Long-term debt: Long-term debt legally payable from general revenues and backed by the full faith and credit of a governmental unit. General Obligation Bonds [GO BONDS]: Bonds which are secured by the full faith and credit of the issuer. General Obligation bonds issued by local units of government are secured by a pledge of the issuer’s ad valorem taxing power. General Property Tax: The tax usually levied on real and personal property. This tax is typically levied locally.

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General Appendix Generally Accepted Accounting Principles [GAAP]: GAAP is a way of reporting. GAAP reporting will enable your government through the use of proper funds, to present more informative Goal: A statement of broad direction, purpose or intent based on the needs of the community. A goal is general and timeless. Governmental Accounting Standards Board [GASB]: A standard-setting body, associated with the Financial Accounting Foundation and comparable to the Financial Accounting Standards Board, which prescribes standard accounting practices for governmental units in maintaining their financial records and releasing financial data to the public. Governmental National Mortgage Association [GNMA or Ginnie Mae]: One of two corporations formerly comprising the FNMA. GMNA is an agency of the Federal Department of Housing and Urban Development empowered to provide special assistance in financing home mortgages and is responsible for management and liquidation of federally owned mortgage portfolios. Its liquidation functions involve the issuance of participation certificates representing beneficial interest in future payments on a pool of mortgages. Grant: A contribution of assets (usually cash) by on governmental unit or other organization to another. Typically, their contributions are made to local governments from state and federal governments and made for specified purposes. Grants Management: Recording grants-related transactions in keeping with grant regulations, and preparing financial reports for grantor agencies.

City of Lee’s Summit Annual Budget FY15 Gross Bonded Debt: The sum of all General Obligation Debt. Also known as Direct Debt. Internal Audit: Reviewing financial transactions in both the finance department and in operating departments for compliance with local policy and generally accepted accounting principles. Internal Control: A plan of organization for purchasing, accounting, and other financial activities which, among other things, provides for separation of duties, proper authorization from responsible officials in processing of a transaction and the arrangement of records and procedures to facilitate effective control. Internal Service Fund: Funds used to account for the financing of goods or services provided by one department or agency to other departments of a government on a cost- reimbursement basis. Investment management: Determining amounts and types of investments to be made, securing quotes from financial markets, and apportioning interest earned to the proper funds. Investment of Proceeds: The investment of proceeds and other moneys relating to an issue is typically governed by state law and by the Indenture or Bond Resolution. Inventory: Maintaining custody and records of supplies held in stock for future consumption. Level Debt Service: An arrangement of serial maturities in which the amount of principal maturing increases at approximately the same rate as the amount of interest declines, resulting in substantially equal annual debt service payments over the life of the bonds. Levy: (verb) To impose taxes, special assessments, or service charges for the support of government 283 | P a g e


General Appendix activities. (noun) The total amount of taxes, special assessments or service charges imposed by a governmental unit. Liability: Debt or other legal obligations arising out of transactions in the past which must be liquidated, renewed or refunded at some future date. Note: This term does not include encumbrances. Liquidity: The ability to convert an investment to cash promptly with minimum risk to principal or accrued interest. Long-Term Debt: Debt with a maturity of more than one year after date of issuance. Management Information Systems [MIS]: Management Information Systems is an internal service department that provides computer and telecommunications needs to the other City Departments. Management Information Systems Equipment Replacement Program [MERP]: The user departments will pay a rental or lease charge that will provide funds for replacement of MIS equipment at a scheduled future date. The rental rate also includes routine maintenance service much like a commercial leasing company. Modified Accrual Basis: The basis of accounting under which expenditures other than accrued interest on general long-term debt are recorded at the time liabilities are incurred and revenues are recorded when received in cash and/or available revenues which should be accrued to reflect properly the taxes levied and revenue earned. Moody’s Investors Service: An independent service subsidiary of Dun & Bradstreet Crop., based in New York City, which provides ratings for

City of Lee’s Summit Annual Budget FY15 municipal bonds and other financial information to investors. Municipal Securities Rule Making Board: An independent, self- regulatory organization established by Congress in 1975 having general rule making authority over municipal securities market participants (generally, brokers and dealers). Negotiated Sale: The sale of a new issue of municipal securities by an issuer through an exclusive agreement with an underwriter or underwriting syndicate selected by the issuer. Net Direct Debt: With respect to any given Issuer the amount of all outstanding debt of such Issuer (Direct Debt), less the sum of any amounts accumulated in sinking funds for such debt and the amount of such debt that is self-supporting. New Issue: An issue of securities which is purchased from the issuer and offered to investors, usually on a “when issued” basis, for the first times. Non-Callable Bond: A bond that cannot be redeemed at the issuer’s option before its stated maturity date. Object of Expenditure: Expenditure classifications based upon the types or categories of goods and services purchased. Objective: Something to be accomplished in a specific, well defined, and measurable terms, and that is achievable within a specific time frame. Outstanding: In general as used with respect to the principal of an issue, remaining unpaid. Pay-As-You-Go Basis: A term used to describe the financial policy of a governmental unit which

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General Appendix finances all of its capital outlay from current revenues rather than by borrowing. Paying Agent: The entity responsible for transmitting payments of interest and principal from an issuer of municipal securities to the security holders. The paying agent is usually a bank and generally provides reconciliation of the securities and coupons paid and similar services. Payment Date: The date on which interest, or principal and interest, is payable. Payroll: Generating employee paychecks, deducting and transmitting taxes and other payments, administering insurance and other benefits, and generating required reports. Pension Administration: Managing contributions to pension accounts, maintaining records of individual employees’ account balance, making investments on behalf of pension funds, and disbursing retirement income. Per Capita Debt: The amount of an issuing municipality’s debt outstanding divided by the population residing in the municipality. Pledged Revenues: The monies obligated for the payment of debt service and other deposits required by bond contract. Policy Analysis and Research: Evaluation of policy options and recommending policies on revenue generation, financial administration, and financial aspects of operating policies and activities. Premium Call: A redemption provision which permits the issuer to call securities at a price above par. Principal (in relation to bond issuance): The face amount or par value of a security payable on the maturity date.

City of Lee’s Summit Annual Budget FY15 Proceeds/Original Proceeds/Gross Proceeds: The amount paid to the issuer by the first purchaser of a new issue. Gross Proceeds refers to all of the moneys relating to an issue which are subject to Arbitrage limitations and Rebate under the internal Revenue Code. Public Offering: The sale of bonds to the general public. Purchasing: Determining source and price of goods and services requisitioned by operating departments; authorizing and monitoring purchases. Rating Agencies: The organizations which provide publicly available ratings of the credit quality of securities issuers. Rebate: To pay the United States government amounts earned from the investment of gross proceeds at a yield in excess of the yield on the issue. Redemption: A transaction in which the issuer returns the principal amount represented by an outstanding security. Refunding: A procedure whereby an issuer refinances an outstanding bond issue by issuing new bonds. Refunding Bond: A bond issued to retire a bond already outstanding. Registered Bond: A bond whose owner is designated on records maintained for this purpose by registrar, the ownership of which cannot be transferred without the registrar recording the transfer on these records. Revenue Bond: A bond which is payable from a specific source of revenue and issuer with taxing power is not pledged. Revenue Bonds are 285 | P a g e


General Appendix payable from identified sources of revenue, and do not permit the bondholders to compel taxation or legislative appropriation of funds not pledged for payment of debt service. Generally, no voter approval is required prior to issuance of such obligations. Revenue Collections: Billing, collecting, and posting revenues from user fees, licenses, fines, etc. Receiving and posting revenue from tax bills; collecting overdue bills. Providing technical support and control to operating departments which collect such revenue. Revenue Estimate: A formal estimate of how much revenue will be earned from a specific revenue source for some future period, usually a future fiscal year. Revenue Fund: A fund established by the bond contract of a revenue bond issue into which all gross revenues from the financed project are initially placed and from which the monies for all funds are drawn. Risk Management: Making determination of issuance coverage, administering payments to insurance companies and administrative services providers; determining and financing liability for self-insured risks. Serial Bonds: Bonds of an issue which are payable as to principal in amounts due at successive regular intervals, generally annual or semiannual and generally in the early years of the term of the issue. Special Assessment: A charge imposed against property in a particular locality because that property receives a special benefit by virtue of some public improvement, separate and apart from the general benefit accruing to the public at large. Special Assessments must be apportioned

City of Lee’s Summit Annual Budget FY15 according to the value of the benefit received, rather than the cost of the improvement, and may not exceed the value of such benefit or the cost of the improvement, whichever is less. System Development Charge: A reimbursement fee, an improvement fee or a combination thereof assessed or collected at the time of increased usage of a capital improvement or issuance of a development permit, building permit or connections to the capital improvement. This charge includes that portion of a sewer or water system connection that is greater than the amount necessary to reimburse the unit of local government for its average cost of inspecting and installing connections with water and sewer facilities. Tax or Taxes: Compulsory charges levied by a governmental unit for the purpose of raising revenue. Tax revenues are used to pay for services or improvements provided for the general public benefit. Tax Anticipation Notes [TANS]: Notes issued in anticipation of collection of taxes usually retirable only from tax collections, and frequently only from the proceeds of the tax levy whose collection is anticipated at the time of issuance. A form of short-term financing. Tax Base: The total property and resources available to a governmental entity for taxation. Tax Billing: Determining amounts to be billed to individual taxpayers and distribution of bills to each taxpayer. Tax-Exempt Bond: Another term for a municipal bond. Interest on many municipal bonds is exempt from federal income taxation.

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General Appendix Tax Rate: The amount of tax stated in terms of a unit of the tax base. Tax Rate Limit: The maximum rate or millage of tax which a local government may levy. Trustee: A financial institution with trust powers which acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract. Underwriters: A dealer which purchases a new issue of securities for resale. Traders with contacts with large bond buyers and ability to price the bonds for sale. Upgrade: The rising of a rating by a rating service due to the improved credit quality of the issue or issuer.

City of Lee’s Summit Annual Budget FY15

Utility Billing: Determining amounts of water, sewer, electric bills; sending bills to customers, depositing and posting receipts, collecting overdue amounts. Vehicle Equipment Replacement Program [VERP]: VERP provides funds for replacement of vehicles at a scheduled future date through user departments paying rental or lease charges. The rate also includes routine maintenance service much like a commercial leasing company. Working Capital (Designated): An account within the fund balance of the General Fund in which a certain amount of resources were set aside for purposes of maintaining a positive cash flow, shortfalls in the revenue projections, and emergencies during the fiscal year.

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General Appendix

City of Lee’s Summit Annual Budget FY15

ACRONYMS AV: Assessed Valuation BERP: Building Equipment Replacement Program CIP: Capital Improvement Program CD: Certificate of Deposit COP: Certificate of Participation F&PC: Finance and Personnel Committee FNMA: Federal National Mortgage Association (or Fannie Mae) FTE: Full Time Equivalents GO Bonds: General Obligation Bonds GAAP: Generally Accepted Accounting Principles GASB: Governmental Accounting Standards Board GNMA: Governmental National Mortgage Association (or Ginnie Mae] MIS: Management Information Systems MERP: Management Information Systems Equipment Replacement Program TANS: Tax Anticipation Notes VERP: Vehicle Equipment Replacement

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Appendix

General

City of Lee’s Summit Annual Budget FY15

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General Appendix

City of Lee’s Summit Annual Budget FY15

Quick Facts: • Located in Kansas City, Missouri Metropolitan area, in Western Missouri • Currently encompasses a total geographic area of 65.87 square miles in both Jackson and Cass counties, Missouri • Divided into 4 City Council Districts • Served by 5 school districts with Lee’s Summit R-VII serving the majority of the city area • Served by major highway corridors including I-470, US 40, US 50, M-291, M-150, and M-350 • Served by the Union Pacific Railroad and Amtrak

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General Appendix

City of Lee’s Summit Annual Budget FY15

MO Statewide Populations and Rankings Geographic Area State of Missouri Counties St. Louis County

Total Population

Rank

5,988,927 998,954

1

Jackson County St. Charles County Greene County Clay County

674,158 360,485 275,174 221,939

2 3 4 5

Jefferson County Boone County Jasper County

218,733 162,642 117,404

6 7 8

Franklin County Cass County Cities Kansas City St. Louis Springfield Independence Columbia

101,492 99,478

9 10

459,787 319,294 159,498 116,830 108,500

1 2 3 4 5

91,364 79,329 76,780 65,794 52,575

6 7 8 9 10

Lee's Summit O'Fallon St. Joseph St. Charles Blue Springs

Demographics Average Household Size Median Age Median Household Income Per Capita Income Households Median Value Owner-Occupied Housing Units

2010 Census 2.62 37.2 $73,151 $33,149 33,054.00 $185,500

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General Appendix

City of Lee’s Summit Annual Budget FY15

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City of Lee’s Summit Annual Budget FY15

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FY15 City of Lee's Summit Budget  

Fiscal Year 15 Budget City of Lee's Summit, MO