- FY 2024-2025 BUDGET REVIEW MEETING July 11,2024 9 am CA AWARNING This is not going to be your typical Mexico Beach Budget Workshop In addition to discussing the City budget, we're going to touch on: History World Events National Economic Policy Long-term Planning YOU ARE GOING TO BE FORCED TO THINK AND THINK OUTSIDE THE BOX Things to think about during this presentation 1. Near-Term Needs and Goals 2. Future Needs and Goals 3. Hurricane Michael Killed "old" Mexico Beach 4. Growth: Do we want to control it or not 5. Putting aside personal feelings to do what is best for the City as a whole Three Additional Items for the Council to Consider 1. Are we filling in the canal between Parker Park and Hwy 98? Ifso, who is paying for it? Also, if Sweetwater is doing the work, do we stop developing Parker Park in the meantime? 2. FS218.415 and creating a City Investment Plan and Reserve Policy 3. How do we want to leave Mexico Beach for those that come after us? Notj just at the end of our terms in office -but for future generations. WHAT GOTUSTO WHERE WE ARE TODAYE AND WHERE DO WE WANT TOGO IN THE FUTURE2 Overview of the Current Fiscal Year (Better known as: "FY24: A Trainwreck Barely Avoided") FY23-24 TE Three Primary Problems Were Encountered Primary Problem Emcoumtereds Financial reporting and fund balancing was delayed due to the lack of an in-house Accountant/Finance NOW Director. This deficiency made financial decisions very difficult for HIRING management staff. Secomdary Issueo CPA'S/ACcountant's daily jobs are much different that municipal accounting. Hiring Carr, Riggs & Ingram, as great as they are, has not resolved these concerns. Issue #30 Needed capital items and repairs were budgeted with restricted funds and godwine could not be purchased/completed as originally planned. FY24BUDGET/FISCAL HIGHLIGHIE Due to the concerns with the fund balances, the City cut spending, and this has improved the health ofthe General and Enterprise Funds. Current Numbers Budget Fund by General Ledger Revenue VS Expenses Summary User: Printed: Fiscal Year: 2024 Fiscal Penod: Ito12 Fund 001 101 400 410 420 430 CAPAARSNSSANNSN 7:6/2024- 11:10AM MEXICOBEACH Description General Fund Hurricane Michacl Fund Water Fund Sanitation Fund Sewer Fund Fire Fund Report Totals: YTDI Balance Before Period Revenues for Period Expenses for Period 4.626.005.26 1,087,111.76 1,177.963.97 582.975.31 1.314.268.58 0.00 8,788,324.88 Year tol Date Amount 963,265.27 111,876.23 534.870.52 209.470.51 845.988.64 0.00 2,665.471.17 0.00 0,00 0.00 0.00 0.00 0.00 0.00 3.662.739.99 975.235.53 643,093.45 373,504.80 468,279.94 0.00 6,122,853.71 Current Bank Account Balances Deposit Accounts Account Name 1 USDA FEMA Payroll Invoice Sewer RECD LEE Fund SRF Repaymens Pooled Cash Police Impact Fees Fire/ESU Impact Fees Recreation Impact Fees Water Impact Fees Sewer Impact Fees 0556 PAN 6-11 MO 100 0606 PAN 12-17MO 10 0556 PAN 6-11 MO 100 0606 PAN 12-17MO 10 Totals Account Number N Ledger Balance N Collected Balance 1 Available Balance 11 Download 5122.665.91 5630,139.96 $0.00 $0.00 559.939.76 55.203.85 $649.22 $9,556,084.52 568,556.28 5135,887.17 5423.854.16 $571,723.38 $1,317,889.51 $1,061,914.28 $1,044,980.44 $796,435.71 $261,245.12 $16,057,169.27 $122.665.91 $630,139.96 $0.00 $0.00 $59,939.76 $5,203.85 $649.22 59,556.084.52 568,556.28 $135,887.17 $423,854.16 $571.723.38 $1,317,889.51 $122,665.91 5630,139.96 $0.00 $0.00 559,939.76 $5,203.85 $649.22 $9,556,736.89 $68,556.28 $135,887.17 $423,854.16 $571,723.38 $1,317,889.51 - - 0 $12,892,593.72 $12,893,246.09 Download PROBLEM Which brings US to the upcoming 2024-2025 Fiscal year FY24-25 BLDGEIGONS: Cut Taxes for our Homesteaded Property Owners Provide Better Service and Services to our Property Owners and Visitors Provide Increased Safety (Fire, Police, Utilities) to our Property Owners/Visitors Improve Existing Assets (Boat Ramp) and Build New Facilities (Parker Park Amphitheater) Provides the Tools and Equipment Needed by City Employees to Complete Their Jobs - Acquires Property for Future Growth and Economic Development Purposes Incorporate Long-Term Planning Goals and Pathways into the Budgeting'rycess Lays the Foundation to Incorporate eand Compensate for Future Growth Beyond our Existing Boundaries - Provides a Mechanism to Dampen Negative Economic Effects Brought About By Events Outside Our Control R.I.D.A FY24-25 Mexico Beach Property Valuatioms Total Value: $1,086,067,906 New Construction: $ 41,624,367 Total Assessed Value: $ 820,686,179 Total Taxable Value: $ 759,630,084 Taxable Property Values ($ per Year) $800,000,000.00 $700,000,000.00 $600,000,000.00 $500,000,000.00 $400,000,000.00 $759,630,084.00 $300,000,000.00 $535,645,519.00 $394,893,696.00 $408,817,320.00 $200,000,000.00 $354,318,655.00 $315,505,467.00 $100,000,000.00 $0.00 2020 2021 2022 2023 2024 2025 Taxable Property Values ($per Year) Mexico Beach Proposed Millage Rate Current Rate: 5.9999 Current Revenue: $3,672,242 Proposed Rate: 5.7500 Proposed Revenue: $4,149,479 Ad Valorem Revenues ($ per Year) $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 $4,149,479.00 $3,562,043.00 $2,744,218.00 $2,718,635.00 $2,397,380.00 $2,197,106.00 $0 2020 2021 2022 2023 2024 (oudgeted) 2025 (proposed) Ad Valorem Revenues ($ per Year) Proposed Taxable Valuation & Millage Rate Facts City-wide Taxable Values Increased 22% 5.75 mills DECREASES the millage rate by 4.17% Homesteaded Properties will see an effective Tax Cut of4.01% from FY23-24 (current year) City ad valorem revenue will increase by 13%, even though taxable value increased 22% How Were These Numbers Reachhed EQLATONSINIENIONALYAEPSNTE SOAI HILLBILLY GOATFARMERCANDESCRIBE THEM) - Taxable Value: $100,000 - Taxes Due This FY: $599 + Max Increase 3%: $103,000 - Taxes Due @ 5.9999: $617.99 5 5.75 mills/5.9999mils - 0.9583493058 - Taxes Due @ 5.75 $575/S617.99: - $566.50/S599: $575 4 4.17% decrease 6.96% decrease 4.01% effective decrease 4444 e 0 lol <3% Increase in Rates due to Bay County increasing rates by 3% Water Department High Capital Items >One Medium Truck 50% ofa Towed Air Compressor to be Shared with the Sewer Dept. >50% ofa 30hp Tractor to be Shared with the Sewer Dept. Projects Joint Warehouse Construction with Sewer Department Purchase/lnstallation of "Fixed Base"" Antennae and Utility Software PurchaweIinstallation of Upgraded Water Meters - / Atmospheric Valve Replacement Installation of an Aerator in the Million Gallon Water Storage Tank Samitation Department Projected Revenues: $737,470 Projected Expenditures: $737,470 Samitation Department Noteso Persommel Costso Health Insurance +5%, Workers Comp +20% Proposed 2% COLincrease, Zero to 3% incentive pay increase Revemues. 5% Increase in Rates due to Inflation and Expected increases in fuel and disposal costs Samtation Depto Highlights: We're going to comtmue to be the BEST small town Samitation Department in the Country and not request any new capital Items or personnel, in the processo Sewer Department Projected Revenues: $2,751,814.98 Projected Expenditures: $2,751,814.98 Sewer Department Noteso Persommel Costso Paying for 50% ofa New Employee to be Split with the Water Dept. Health Insurance +5%, Workers Comp +20% > Proposed 2% COLincrease, Zero to 3% incentive pay increase Revenuess 9% Increase in Rates due to Bay County increasing rates by 9% Sewer Department Highligl Capital Itemso >One Medium Truck >50% ofa a Towed Air Compressor to be Shared with the Water Dept. >50% ofa 30hp Tractor to be Shared with the Water Dept. Crane Truck Projectsa Joint Warehouse Construction with Sewer Department Rehabilitation of the Lift Stations on 14th Street and Nanook FEMA Fundo Proiects Amoumt >Municipal Complex >Jetty Repair/Extension Stormwater Improvements >Hwy 98/Toucans Restrooms Mexico Beach Pier $5,500,000 $3,500,000 $7,000,000 $ - 300,000 $ 50,000 A UESTIONS 1IME FOR A BREAK know survive formal techniques questions company making Socio-oultural including Strengths determining N C many 9 a key gDuncan document Social e - * Legai de . future. a * needs - 5 days E Regulatory cornerstone viewed de la avoid E - S A. L organzations deals course three organizational 1 s a turbulent issues e de Strategic d effectively Environment consideration vision year a planning tinkering Various 8 E resources Opportunities people phrased get piansbusinesso resulting Informatic may tool, de lt de evolve third Economic S S o df a Why Are We Discussimg Lomg-Term Strategic Plamming Durimg the Budget Processe 1. The BEST Time to have discussedLong-lem Planning was Yesterday Since We Didn't do it Yesterday, We're Doing it Today 2. Planning Involves Money and Money Involves the Budget 3. Four Parcels Of Property are in the Proposed FY24-25 Budget to Purchase for Long-Term Planning Purposes 4. Most Property Owners are Interested in our City Budgetso Iexpect this Workshop to be Seen by A LOT ofPeople and I Want to be as Fully Transparent As Possible When it Comes to Taxpayer Money and our plans with it (Cont.) Wly Are We Discussimg Lomg-Term Strategic Plamming Durimg the Budget Processe (Comto) 6. - One Proposal is Going to Involve Investing Reserve Funds Differently than What the City has Done in the Past. 7. The City Administrator has already initiated conversations with pertinent outside parties regarding these issues and is seeking City Council "buy in" before potentially wasting time in the upcoming year on something undesired 8. These strategic long-term planning items will require Council involvement and action at some point in the future SO now is a great time to inform everyone at once. There are Two Primary, Overarching Areas the City ofMexico Beach Must Face When it Comes to strategic Long-term planning: Future Growth Potemtial Threats I Natural Disasters - Primarily Hurricanes (no need to explain 7 parcels owned by The St. Joe Company totaling 1240 acres directly to our north this) I Man-Made Disasters Global Instability Terrorist Attack War The Land off Hwy 386 between Mexico Beach and Wewahitchka - The Land between Mexico Beach and Port St. Joe The "Harmon Property" Economic Disasters I National Debt - Inflation Sugar Sands/Farmdale, north ofHwy 98 - Destruction of the U.S. Dollar Sources of Mumicipal Revemue Ad Valorem Taxes State Revenue Sharing Utility Taxes I Impact Fees Service Fees, Rent, Miscellaneous Revenues Grants and State Appropriations The first 5 are size and growth-related St. Joe Company 1240 acres Importamt GDNVID/ReyemIe Relatonsihmp: As a municipanty growSo B's revenues also grow leading to a lower tax burden on alD property ownerso 4 Growth Tax Burden As this area has seen since Hurricane Michael, people have discovered the GF Forgotten Coast" and more growth is coming. Do we want to control it ORdo we want it to control US? FY24-25 Strategic Long- Term Plammimg Goals/Pronceiy Working with Gulf County/Port St. Joe to connect to one of their sewer systems to service land to our North Working with Gulf County/PSJ to connect to one of their water systems to provide MB an alternate water source Once the final decision is made by FEMA regarding the municipal complex, begin engineering studies for a larger water storage tank on the 25-acre property (Cont.) FY24-25 Strategic Long-Term Plammimg Projects A Acquiring additional land for future growth and economic development S.37th Street (economic development, parking) 1 14th Street (parking) N.32nd Street (improving traffic flow, safety, parking) Updating the Land Development Code - Creating a City Investment Plan incorporating precious metals as an investment option SLT Plammimg Ratiomale Water & Sewero 1. Mexico Beach needs an alternate water supply in case anything occurs to the Bay County Plant, Deer Point Lake, or the primary distribution line to us 2. Mexico Beach will need additional capacity in the future to service the areas to our north and connecting to either Gulf County or PSJ would provide extra capacity as well as the possibility for a redundant system. SLT Plammimg Ratiomale Lamd Acquisnuiomss 1. N.32nd Street will allow for constructing a through-street to the future Sweetwater Development, alleviating traffic from the shopping center and providing extra parking 2. 14th Street will provide additional parking and additional parking options to future City leaders. Also allows for development ofa new primary beach access to reduce congestion on the dedicated beach and 37th St. (Cont.) SLT Plammimg Ratiomale Lamd Acquisntions (Comto)e 3. S.37th Street provides a once-in-a-lifetime opportunity for the City to acquire prime real estate next to a City- owned asset (the Pier) and develop it as a mixed-use development complimenting the style" ofMexico Beach featuring retail, food, and other commercial establishments in addition to residential units (Cont.) SLT Plammimg Ratiomale Land Aequishdionsg 3. (Cont.) S.37th Street would give the City the opportunity to create a unique space, with a mixture of businesses and activities, which could be enjoyed by both residents and visitors. Would be a central focal point for the City, in addition to being a revenue source. ADDED RECOMMENDATION: the City construct 2 or 3 residential units for its use two for City Administrator and Finance Director, one for dignitaries/consultants. SLT Plamming Rational Updatimg the Land Development Codeo Will provide an in-depth, comprehensive update to the LDC in order to modernize it and bring it up to comparable standards with similar communities who have experienced growing pains due to population and development transitions ADDED RECOMMENDATION: Consideration should be given to loosening the development restrictions (height, density, etc.) and encouraging commercial development, while also increasing construction and aesthetic standards for those unincorporated properties to our north. This would encourage annexation, allow developers to offset the added cost of the increased standards, and make more profit than if they annexed into Mexico Beach under our current LDC. SLT Plammimg Ratiomale Creatimg a Chty Imvestment Plam to Imclude Precious Metalso 218.415 Local government investment policies.-investment activity by a unit of local government must be consistent with a written investment plan adopted by the governing body, or in the absence of the existence of a governing body, the respective principal officer of the unit of local government and maintained by the unit of local government or, in the alternative, such activity must be conducted in accordance with subsection (17). Any such unit of local government shall have an investment policy for any public funds in excess of the amounts needed to meet current expenses as provided in subsections (1)-(16). or shall meet the alternative investment guidelines contained in subsection (17). Such policies shall be structured to place the highest priority on the safety of principal and liquidity of funds. The optimization of investment returns shall be secondary to the requirements for safety and liquidity. Each unit of local government shall adopt policies that are commensurate with the nature and size of the public funds within its custody. SLT Plammimg Ratiomale Creatimg a Chty Imyestmemt Plam to Imclude Precious Metals (Comto)s (16) AUTHORIZED INVESTMENTS; WRITTEN INVESTMENT POLICIES.-Inose units of local government electing to adopt a written investment policy as provided in subsections (1)-(15) may by resolution invest and reinvest any surplus public funds in their control or possession in: (h) Other investments authorized by law or by ordinance for a county or a municipality. SLT Plammimg Ratiomale Creating a Chty Imvestmemt Plam to Imclude Precious Metals (Comt)s Take Mexico Beach reserve funds and split initially into thirds: 1/3 to be invested in cash & cash equivalents (money market, short term CDs) I 1/3 to be invested in longer-term CDs and Government- backed investments for a higher interest rate I 1/3 to be invested in precious metals (gold, silver) SLT Plammimg Ratiomale Creatimg a Chty Imyestment Plam to Imclude Precious Metals Why388d Creates a store of value I Protects the City from national events outside our control Federal Debt Inflation Devaluation ofthe U.S. Dollar - Removal ofthe U.S. Dollar as the "Reserve Currency" (BRICS) SLT Plammimg Ratiomale Creatimg a City Imvestment Plan to Imclude Precious Metals Why38go STORE OF VALUE Gold Will Always Be Worth Something Live Metal Spot Price (24hrs) Jul08, 2024 at 10:58 EST Gold Spot Prices Gold Price Per Ounce Gold Price Per Gram Gold Price Per Kilo Today $2,385.67 $76.7 $76,701.07 Change -12.32 -0.4 -396.10 SLT Plammimg Ratiomale Creatimg a City Imvestmemt Plam to Imclude Precious Metals 999 INELATION 320 300 280 260 240 3.3% annualizedr rate 8.5%2 annualized rate 1.8% annualizedrate 200 6/22 Linear(1/21-6 6/22) Linear (Pre-Jan/21) Source: Bureauoflabor: Statistics; Chart: Orealejantoni Linear (PostJ Jun 22) SLT Plammimg Ratiomale Creating a Chty Imvestment Plam to Imclude Precious Metals Wy388 EDERALDEEI 3,250 3,000 2,750 2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 500 250 :8 Sources: Bureaus of Economic Analysis, Dr. EJAntoni U.S. National Debt Overt the Last 100 Years Inflation Adjusted- 2023 Dollars 2023 $33.17T FiscalYear TotalDebt $35T $30T $25T $20T $15T $10T $5T SO 1923 1943 1963 1983 2003 2023 SLT Plammimg Ratiomale Creatimg a Chty Imvestment Plam to Imclude Precious Metals Why38Bo DEVALUATION ADOLLAR'S WORVEL PURCHASING POWER OF THE U.S. DOLLAR Thepurchasingr power US. dollar hasf fallens sharply duet torising inflationa andm money supply. Purchasing Power of U.S. Dollar $120 $100 $80 $60 540 $20 $0 $26.14 TheFederIR 19.91 1$14.71 $15.14 woridsrser urency. $1.20 $9.69 $8.35 $3.06 $2.28 $1.61 $1.00 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010_2020 Source: Observations ObseryationsAndNotesbiogpotcom) Year $26.14 SLT Plammimg Ratiomale Creatinmg a Chty Imvestment Plam to Imclude Precious Metals Why3880 REMOVAL OF THE Uso DOLLAR AS RESERVE CURRENCY China's Gold Rush USDBillions VISUALIZING THE 2023 BRICS, abloce of developing countries formedi in2 2010, issett tow welcome sixn new - Members New) Members A Appliedfor membership BRICS EXPANSION membersatt thel beginningof2 2024. 161.07 150 TheR Resurgence oGold 1200 Gradually Thens Suddenly UAE China Holdings cfus Treasuries (R1) China Official GoldReserves (L1) E ARGENTINA the SOUTHAFRICA 2012 2013 2014 20:5 2016 2017 2018 209 Source: Bloomberg: TaviCosta 2022 2024 2025 0202CresaCaptalG SLT Plamming Ratiomale Creatimg a Chty Imvestment Plam to Imclude Precious Metals Why3880 RECENT TRENDS Gold $/oz U.S. Dollar $2,500 $2,000 $1,560 $1,500 $1,000 $500 $0 $2,368 $2,034 100 77.37 96.49 95 90 85 80 75 70 $1.866 $1816 $1,899 89.77 84.35 81.81 2020 2021 2022 2023 2024 Today 2020 2021 2022 2023 2024 Gold $/oz -U.S. Dollar SLT Plammimg Ratiomale These numbers come from official government sources: LABOR STATISTICS TOOLSY CPI Inflation Calculator CPI Inflation Calculator $ in January 10,000,000.00 CPlInflation culator (2020 has the same buying power as $12,174,585.52 in (May (2024 Calculate NORMALCY BIAS: NORMALCY BIAS DESCRIBES OUR ENDENCYIO UNDERESHMAE THE POSSIBITY OFDISASTER AND BBEVETHANT LIFE WILL CONINUE AS NORMAL, EVEN IN THE FACE OF SICNIFICANI THREATS OR CRISES. 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