TOWN OF DUCK
TOWN COUNCIL
REGULAR MID-MONTH MEETING
The Town Council for the Town of Duck convened at the Duck Municipal Offices at 1:00 p.m. on Wednesday, October 19, 2005.
COUNCIL MEMBERS PRESENT: Mayor Pro Tempore Allan Beres; Councilor Nancy Caviness; Councilor Monica Thibodeau; and Councilor Neil Morrison.
COUNCIL MEMBERS ABSENT: Mayor Gene Schwarz.
OTHERS PRESENT: Town Manager and Town Clerk Christopher Layton; Town Attorney Donald I. McRee, Jr. and Deputy Town Clerk Lori Kopec.
OTHERS ABSENT: Planning Director Suzanne Cotellessa.
The meeting was called to order by Mayor Pro Tempore Beres at 1:00 p.m.
Town Manager Chris Layton stated that the Town had a square dance recently. He stated that the total donations received to date were $7,151. He stated that approximately 100 people had attended the square dance, which did not include those who volunteered their time. He stated the Gator costs $6,846.17, leaving a balance of $304.83. He recommended the balance be given to the Dauphin Island Fire Department. He stated the next step would be getting the Gator to Dauphin Island. He stated that several police officers have volunteered to drive to Dauphin Island. He stated he has not spoken with Mayor Schwarz yet as to whether he would like to go and bring Mayor Pro Tempore Beres with him to meet the mayor of Dauphin Island.
Mayor Pro Tempore Beres asked what the timeframe would be for the delivery of the Gator. Town Manager Layton stated that there wasn’t a set timeframe, but would hope something would be planned in the new couple of weeks.
Councilor Caviness asked if he had spoken with the mayor of Dauphin Island to let him know that the Town has raised enough money to purchase the Gator for them. Town Manager Layton stated he has not spoken to the mayor but that Mayor Schwarz has spoken to him at least once. He stated he will more than likely to speak to him once the plans to get the Gator to him are finalized. Councilor Caviness asked if Mayor Schwarz had mentioned the purchase of the Gator to the mayor. Town Manager Layton stated he was not sure.
Mayor Pro Tempore Beres thanked everyone that helped with the square dance. Councilors Morrison and Caviness stated that the dance was a lot of fun.
DISCUSSION OF A FUND BALANCE POLICY
Mayor Pro Tempore Beres asked Town Manager Layton to make a few comments on the suggestions that Council had given him for the Fund Balance Policy. Town Manager Layton stated that at the last work session, Council had a presentation on what goes into a Fund Balance policy. He stated that the matrix in Council’s packets were comments that Council had given to him. He stated he tried to be as true as possible and asked for any additions as necessary. He stated that based on the comments, he drafted a basic policy. He felt that Council wants to establish a level of controls and purposes as well as establish a range for the Fund Balance.
Council and Town Manager Layton went on to discuss the purpose of the reserve. Councilor Caviness felt that due to the potential for hurricanes to hit the area, the Town should have a high Fund Balance to provide for emergency expenses. Councilor Morrison agreed with Councilor Caviness’ comments. He stated the Fund Balance could be used to purchase property as well further down the road. He felt the Fund Balance should be large. Councilor Thibodeau stated that it makes sense to plan for unanticipated capital expenses. Town Manager Layton emphasized that the way the policy is written, it emphasizes unanticipated capital expenditures as opposed to capital expenditures that are planned. Mayor Pro Tempore Beres pointed out that anything that happens in Dare County will have an impact on the revenues of the Town.
Council and Town Manager Layton discussed the purposes and uses for appropriations from the fund balance. Councilor Thibodeau asked if, as time goes by, the Town will have a designated fund for capital expenditures and if there will be a designated fund to contribute to for capital expenditures. Mayor Pro Tempore Beres asked if there would be a fund for replacement of fire department equipment. Town Manager Layton stated it has been done to a certain extent now as the budget has a Capital Outlay section, but is from the General Fund. He stated that Council could look at it by having the Capital Outlay section as becoming separate funds over time with the Town putting money into them. He stated he would hope through the development of the CIP, it will allow the Town to plan more for the future. Mayor Pro Tempore Beres felt it was important for Town Manager Layton to let Council know what is actually in the undesignated Fund Balance periodically.
Council and Town Manager Layton discussed the amount to be maintained. Mayor Pro Tempore Beres asked Town Manager Layton to review with Council the amount anticipated to be maintained, specifically a dollar amount and a percentage. Town Manager Layton stated that in 2004, the Town ended the year with an unreserved Fund Balance of $1.2 million dollars. He stated that it equates to 27-30%. Of that, designated portions were approximately $300,000 - $350,000, making the actual undesignated unreserved Fund Balance at $847,000. He stated that this year he hopes the Town will add approximately $500,000 to the undesignated Fund Balance, bringing it up two percentage points. Councilor Morrison asked if the balance would be around $1.3 million. Town Manager Layton felt it would be about $1.5 to $1.8 million dollars for Year Ended June 30, 2005. Mayor Pro Tempore Beres asked if that would put the Town at 35%. Town Manager Layton stated he was correct.
Councilor Caviness asked how many months’ operating expenses would be covered by the Fund Balance. Town Manager Layton stated he couldn’t answer the question at this time. Mayor Pro Tempore Beres asked if 8% would equal one month. Town Manager Layton stated he was correct. Councilor Caviness asked how long it would take to get from 30% to 80%. Town Manager Layton stated that the way a reserve is built is to be conservative on revenue estimates and disciplined on the spending side.
Councilor Caviness stated she would like to see the amount to be maintained in the high range such as a high 70% to 80%. Councilor Morrison stated that 80% could be a figure for the Town to shoot for. He felt it was a good target number. Councilor Thibodeau agreed with Councilor Morrison and felt it should be in the 80% range. Mayor Pro Tempore Beres stated that he and Mayor Schwarz had wanted a range of 50% to 100%. Council and Town Manager Layton went on to discuss at length the amount to be maintained in the Fund Balance, the verbiage in the draft resolution as well as the minimum and maximum amount of an unreserved fund balance.
Town Manager Layton asked Council what their target minimum would be. Councilor Morrison felt a good target would be 75%. Town Manager Layton pointed out that the policy could be as loose or as strict as they wished.
Denver Lindley was recognized to speak. Mr. Lindley stated he will be happy to step in as a Council member and was pleased with the discussion.
Bart Smith was recognized to speak. Mr. Smith stated that the natural growth has been approximately 5% and would like to leave it as long as the natural growth remains at or above 5% and if for any reason for two fiscal years in a row it falls below 5%, then appropriations would need to be made by Council. He didn’t want Council to be too strict but parameters would need to be set. Town Manager Layton wondered if 5% would be enough.
It was consensus of Council to set the minimum at 75% and the maximum at 100%. Mayor Pro Tempore Beres asked Town Manager Layton to draft some language for Council to review as to how to arrive at the minimum. Town Manager Layton asked if Council wanted him to work in Bart Smith’s comments. Councilor Thibodeau felt that two years would be too late. Town Manager Layton felt that two years wasn’t unreasonable. Councilor Caviness felt it wasn’t aggressive enough. Town Manager Layton stated it was. Mayor Pro Tempore Beres stated that Council can ask Town Manager Layton to annually review where the fund balance is in regard to meeting the requirement and Council can renew the plans for the five year goal. He stated he did not want to prescribe how to meet the five year goal. Town Manager Layton agreed.
Town Manager Layton stated he would like to add verbiage similar to Dare County’s policy regarding getting to the minimum. Mayor Pro Tempore Beres agreed. Town Manager Layton asked if he makes the changes, would Council want to discuss it at their November meeting. Council agreed that the November meeting would be fine for the resolution. Councilor Morrison asked if it would be at the November mid-month meeting. Town Manager Layton stated it would be at the regular meeting.
ADJOURNMENT
Mayor Pro Tempore Beres reminded Council and the audience that there was a stormwater meeting at the Fire Department at 6:30p.m.
Town Manager Layton stated he had met with Chris Dewitt of VHB, Inc. earlier in the week in regard to the Tuckahoe stormwater drainage problem. He stated that the solution to the problem would be extremely expensive because the water level is less than two feet. He stated that there may be a meeting needed with NCDOT, Council and Tuckahoe to decide which storm would need to be prepared for to keep the intersection dry as the cost may be more than $500,000. Councilor Thibodeau asked if the water is coming solely from Tuckahoe. Town Manager Layton stated that a good portion of the water is derived from Tuckahoe, but some of it is coming from the Bias Shores subdivision. Councilor Morrison asked where the pump at Tuckahoe went. Town Manager Layton stated that the pump was removed at the end of the summer. He stated he received numerous complaints from Tuckahoe homeowners that he didn’t feel it was worth it to keep the pump on-site in the off season.
Councilor Morrison moved to adjourn the meeting.
Motion carried 4-0. The time was 2:59 p.m.
__________________________
/s/ Town Clerk
Approved: ______________________
_______________________________
/s/ Allan Beres, Mayor Pro Tempore