City Council adopts preliminary budget

$220M plan considered as members debate insurance, payroll

The Yuma City Council adopted a preliminary budget for fiscal year 2018-19 during the Wednesday meeting. This means that the ceiling has been set, but funds can still be moved around within the budget.

The total budget comes to $220.2 million, consisting of an operating budget of $179.6 million, up 2.03 percent from last year, and a Capital Improvement Project budget of $40.6 million, which is an increase of 4.76 percent from last year.

Due to an increase in property values across the city, staff recommended keeping the property tax rate at the Truth in Taxation rate of $2.2747. This means that taxpayers on average will not see a tax increase for FY 2019, staff said.

The CIP was adopted in two parts to allow Councilman Jacob Miller to recuse himself on some items due to a conflict of interest. Mayor Doug Nicholls also declared a conflict and recused himself. Nicholls’ company and the company that employs Miller will potentially be working on some of the CIP projects.

When considering the CIP budget, resident Juan Leal-Rubio requested improvements for 2nd Avenue be put on the CIP. However, staff initially suggested the neighborhood form an improvement district but finally decided the best route might be to seek grant funding to do the work.

The council continued discussion of the budget where it left off the previous night, with the focus on health insurance, streetlights and the engineering payroll.

Miller asked for the status of the $3.7 million project with Siemens Industry that will convert streetlights to LEDs. City Administrator Greg Wilkinson said that the city and Siemens have been testing lights and getting feedback. They switched lights after discovering that the first lights were shining too much into people’s windows. Wilkinson said the lights and nodes are on order and should be coming soon.

Wilkinson said they have been doing “due diligence” because they don’t want to make a mistake and later have to replace equipment again.

Miller also questioned the increase to the engineering payroll, calling it a 33 percent hike. However, Chief Financial Officer Pat Wicks clarified that the engineering payroll had only increased 2.8 percent over the previous year. He explained that Miller was comparing the end-of-year actual budget for 2017-18, which did not include the unspent salaries for several vacancies, with the 201819 preliminary budget, which includes the payroll for positions that have now been filled.

Wicks noted that the citywide payroll increased by 2 percent and the overall budget increased by 2.5 percent.

The council also talked considerably about health insurance. Councilman Edward Thomas noted that employees’ raises were

wiped out by increases in health insurance premiums. Wilkinson explained that staff had already spent a lot of time looking at costsaving alternatives and the city has implemented some of those, such as telemedicine and sending people out of town for surgeries and tests, such as MRIs, because it’s cheaper.

Employees also have the option of seeking medical and dental treatment in Mexico. Thomas said that it bothered him that employees were going to Mexico for treatment. Wilkinson replied that it’s a personal choice and some people feel more comfortable over there. He noted that some doctors are licensed in both the U.S. and Mexico.

The Yuma Area Benefits Consortium, a partnership between the city, Arizona Western College, Yuma School District One and Crane Elementary School District designed to provide competitive benefits to each employee group, has been trying to get a better contract with Yuma Regional Medical Center, “but at this point the hospital is not interested,” Wicks said.

Miller again brought up the Mayor and Council Fund, which now includes health insurance for the council members. He said that the council does not have a need for the insurance since most of them have plans elsewhere.

The money saved from dropping the insurance could be moved to public safety or parks and recreation, he added.

Deputy Mayor Gary Knight disagreed, saying he was “totally on board” with offering health insurance to the mayor and council, although he personally uses Medicare. He noted that the cost is only a small part of the budget.

Councilwoman Karen Watts asked if some of the many open positions at the police department could be kept vacant so current officers could receive bonuses as a way to retain them.

Wilkinson said that recruiting bonuses have been discussed as well as having civilians take over some of the internal police duties so sworn officers can patrol the streets. Watts stressed that she’s more interested in keeping officers already here. Wilkinson said they could have those discussions.

Nicholls said he was “pretty satisfied with this budget” and that he liked that the property tax rate had dropped. “I think this is, in all intents and purposes, a flat budget.”