Attachment

EXHIBIT #1 Special Council Meeting 07/24/2006 Proposed Amendments to Budget Ordinances July 24, 2006

Goal • The Budget Team (Tony DePrima, Terry Tieman, and Donna Mitchell) met on Wednesday, July 19, 2006. • Their goal was to transfer an additional $281,000 to the Pension Fund by reducing budget expenses.

Goal • Each fund (General, Water/Wastewater, and Electric) should pay their proportional share, if possible, based on the number of employees in the pension fund. • Desired fund proportions: – General Fund – reduce by $141,000 – Water/Wastewater Fund – reduce by $40,000 – Electric Fund – reduce by $100,000

Our Priorities: • Maintain Electric Reserve due to new contract and rates. • Maintain the Water/Wastewater Capital Asset Reserve for brown water solutions. • Maintain Electric CIP projects because paid through Electric Reserve. • Maintain the Library Reserve. • Minimize the impact on existing projects and programs. The Assumption: • If funds are available, the budget would be restored to the original budget as soon as possible.

The Decision Process – First Consideration Evaluate changed conditions since budget approval. 1) Assistant Engineer resigned – saves $19,000 in General Fund and $12,000 in Water/Wastewater Fund. 2) An error was found – $69,324 for Police HVAC was double budgeted.

The Decision Process – Second Consideration Delay hiring of new or vacant position. 1) Fill vacant Electric Engineer II position three months later – saves $21,000. 2) Fill vacant Electric Engineer I position six months later – saves $38,226. 3) Hire new Meter Tech I three months later – saves $21,000. 4) Hire new Account Clerk III three months later – saves $15,000.

The Decision Process – Third Consideration Postpone Capital Expense items. 1) Reduce Water/Wastewater Meter Reading Technology Upgrade from $200,000 to $175,000 – saves $25,000. 2) Reduce Streets division dump truck expense from $88,000 to $17,000 – saves $61,000. The $17,000 will remain in the General Fund to restore the truck, if possible.

Proposed Amendments to Budget Options General Water/Wastewater Electric Goal $281,000 $141,000 $40,000 $100,000 Salary Assistant City Engineer - $19,000 $12,000 vacant three months Electric Engineer II - $21,000 delayed three months Electric Engineer I - $38,226 delayed six months Meter Tech I - delayed six $21,000 months Account Clerk III - delayed $2,880 $3,075 $9,045 three months Capital Dump Truck - $88,000 $61,000 CIP paid through reduce $61,000 reserves Water/Wastewater Meter $25,000 Reading Technology Upgrade Police HVAC duplication $69,324 Total $281,000 $152,204 $40,075 $89,271