Attendee Name	Title	Status	Arrived
Robin Fisher	Vice Chairman/ Commissioner District 1	Present
Chuck Nelson	Commissioner District 2	Present
Trudie Infantini	Commissioner District 3	Present
Mary Bolin	Chairman / Commissioner District 4	Present
Andy Anderson	Commissioner District 5	Present

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REPORT, RE:  $5,000 SPACE RALLY EXPENDITURE

Commissioner Fisher stated the Board was kind enough to allocate $5,000 to help offset the costs for the Space Rally; and he would like to announce that the $5,000 has been returned to the County, as the money was raised by private investors.

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REPORT, RE:  SNAPPER CLOSURE

Commissioner Chuck Nelson advised he attended Congressman Posey's forum with the federal fisheries group on the snapper closure that is having an impact on the seafood industry as well as the recreational and commercial fishing fleet; and the federal government has now admitted that, somehow, three years worth of snapper data were missed, and that there is a larger population than was anticipated.  He stated a study will continue to figure out what happened and why; during the initial discussions, fishermen were coming in and saying there were more fish out there than what was being reported; and clearly, the data was wrong.  He stated unfortunately, the closure will stay in place because that is the federal law; but there is hope that it will potentially reopen sooner than later. 

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Howard Tipton, County Manager, advised today begins a series of five Workshops designed to continue discussions from earlier meetings to share and explore potential strategies, and to inform the budget process with the Board's feedback and ideas. He stated some of what the Board will hear during the Workshops are not new concepts or ideas; staff has looked at past audit comments, industry budget review reports, consolidation of certain services, outsourcing, efficiency strategies, improving partnerships that address possible service overlaps, investment strategies that provide greater returns on productivity, and government strategies that look at the bigger picture and seek to provide a more cohesive network of needed services; and all of those are components of earlier discussions and ideas.  He stated he has shared his strong belief that the future of Brevard County is bright; after completing his first six months on the job, he is happy to say that he underestimated just how bright Brevard's future is; he believes that within the next five years Kennedy Space Center and the Space Coast will once again be poised to be the center of the space universe; the business plans that have been discussed show a diverse portfolio of space businesses and activities with significant commitment to upgrade launch facilities at both Kennedy Space Center and Cape Canaveral; and that need for diversification has been discussed before.  He noted there is significant business activity and outreach going on in the rest of the County, well above the great news the Board heard last week with Lighting Sciences; Brevard County has great colleges and universities in the region; Brevard County has a Port that is positioned to be a world leader; Brevard County has an unbelievable natural environment and quality of life that is the envy of anyone else anywhere; but this future will not just happen, and it will not be just handed the County; and the County has to work to create it.  He stated it has been seen what happens when a vision is not pursued vigorously; at one time, everything that is launched into space happened just up the road; and in South America there is a launch complex that now handles more than 50 percent of the commercial satellite market.  He stated in looking at the County's short-term and near-term challenges, the Board must keep in mind the opportunities on the horizon; the County must be mindful of the infrastructure needs that this economic growth will bring; and the County must be ready for it.  He stated the County needs an economic investment strategy that puts the County at the front of the line in terms of job creation and business development for the 21st century and beyond; the County workforce needs to be staffed, trained, equipped, and ready; and the environment needs to be continued to be protected, along with the quality of life that brought many people to Brevard County in the first place.  He advised, today's Agenda includes a review of the Strategic Focus Areas (SFAs); staff tried to group all of the functions of County government into areas of commonality; some were easier than others; but staff wanted to pull everything together to have a strategic discussion in each of the different areas.  He stated the Consultant and the Budget Office staff will discuss three key areas in developing and selecting a strategy; and some information will be reviewed that has been previously reviewed with the Board in order to re-set the table.  He stated Phase II gets into specific areas for discussion, which include Management Services and Health, Community, and Economic Services; and after that, staff will talk about the next steps.  He stated on the upcoming calendar, there are strategic focus area presentations for today, the afternoon of May 4th, May 13th, May 27th, and the final Workshop on July 8th.  He noted, the Public Engagement conversations will be on May 17th, May 20th, and May 24th; by the end of today, a date will be circulated to the Board to determine when the electronic town hall meeting will take place; and all of the meetings are designed to add value and conversation to the budget development process.  He stated today, staff will discuss a range of sustainability strategies; the Board will hear about cost containment, cost reduction, reinvestment and development, role change and innovation, and building a resilient organization in anticipation of a future economic rebound.  He stated the Workshops are designed for the Board to provide guidance to him as he builds the budget he will present to the Board in mid-July; and the budget is part of the discussion, but more detailed department presentations will occur in the summer.  He stated what he is hoping for in the Workshop outcomes is long-term direction for Brevard County Government; to obtain feedback from the Board as to the appropriateness of the various sustainability strategies; and to gain guidance and a context for the detailed budget discussions slated for July and August.  He stated the linkage of the Workshops to Budget Development starts with the Strategic Focus Area Workshop, to the Budget Workshops, then Budget Adoption, and finally, Sustainability.  He introduced Dr. Herb Marlowe, and Larry Arrington, of Arrington, Marlowe and Associates. 

 

Larry Arrington stated in looking at the organization, categories of strategic focus areas were developed; today, the concern is with Management Services and Health, Community and Economic Services; and in subsequent Workshops, the Board will hear discussions on the rest of the strategic focus areas.  He stated the  Governance Workshop will be interesting for the Board because that is where the staff will try to poole together many of the innovative changes that it sees necessitated not only by the fiscal constraints the Board faces, but ideas that have been around for a long time that will help position the organization long-term; and included in that will be an economic development component.  He stated the question is what role Brevard County will have in economic development; there is a tremendous amount of planning going on right now as the economy changes; there was an indication from the President a few weeks ago that a major regional economic development strategy is going to be undertaken; and the Board needs to get a sense of what all of that will be about, and what County government can do in the short-term and long-term to link to the best of the strategies that it wants to link to.  He noted that particular effort will be going on through June and will be reported out to the Board for consideration in July; and there is so much activity going on right now, it will take a while to get a good economic development strategy before the Board. 

 

Mr. Arrington stated the purpose of the Strategic Focus Areas is to provide and discuss the sustainability strategies under common themes that will guide the budget development process in addressing the FY 2010-2011 shortfall, review strategies for long-term budget issues for the next three years, and address shifts in role and functions of County government so that it will be sustainable over the long-term.  He stated the strategic initiatives the Board will see in the two SFA's today and in those going forward, are the beginnings of a process; he expects there will be initiatives that are added and deleted as the Board moves through time; in that sense, the strategic plan is really a motion picture and not a still picture; but he believes the Board will be defining the Brevard County of the 21st Century.  He advised the Strategic Initiatives include cost-containment and reduction, partnerships, outsourcing, service level reviews, reinvestment and development, alternative revenue, and role change and innovation.  He stated some of the strategies and initiatives are easy to do; some of them can be done relatively soon as a matter of policy or decision; but some of them are going to take time; and the Board will want to take its time on some of them and make good choices.  He stated in the near-term there are some issues that can be addressed with efficiency and service level reviews, which are going to have to be part of the budget process; those are driven by necessity, because one thing the Board must do is balance the budget; and there are some service level reductions that he suspects some of the Commissioners would not want if not in times that are so fiscally challenged; but some reductions are going to have to be made in order to balance the budget.  He stated in the long-term, strategies such as partnerships, outsourcing, investments to promote efficiency and productivity with longer term payoffs, role changes or shifts, and economic development, will take more time to ferret through than having an immediate budget impact on next year's budget; but if the Board can give direction to staff to begin developing the processes that it will take to implement these through time, the Board will see that there are a lot of opportunities that it would want to do, even if it were not fiscally challenged; and there are some ideas that will bring the Board to the implementation of some of the best practices in public administration today.  He stated his goal, as a consultant, and the County Manager's goal, is to try to position Brevard County Government to be a model; but that will take a lot of effort and time on everyone's part.  He stated the Board's direction is very important in the upcoming workshops, because it will set the tone for changing the role, functions, and culture of the organization for the next few years; and what the Board says will provide the steerage needed to get through these troubled waters and move forward in a productive way. 

 

Dr. Herb Marlowe stated the Board is dealing with three layers; the immediate upcoming fiscal year; the long-term financial picture; and the long-term strategy.  He stated he would like to talk about one of the three key variables, which is the ripple effect.  He stated every time the Board takes an action it impacts a lot of people; other governmental agencies can be impacted, along with municipalities, and departments; part of the challenge of Mr. Tipton and his staff is to think through those ripples and understand them; and that is important, because as the Board makes its policy, it needs to be well-informed about what is going to happen.  He stated he chose to use ditch cleaning an example of a ripple effect; and Alphonso Jefferson, Budget Director, will explain that to the Board.

 

Alphonso Jefferson, Budget Director, stated his goal today is to talk about stakeholder impacts when talking about budget actions; and the example he is using is ditch cleaning.  He stated if there is a reduction there will be an impact to Public Works and Natural Resources; but when staff sat down with those departments, those impacts expanded; a reduction could also impact the County's Federal and community rating service; it could affect insurance on homes; and it could also affect other counties and municipalities, because the drainage systems connect together.  He noted staff discovered that by reducing ditching, it could violate County's State permits; it could increase homeowners insurance; there is also an emergency management impact; and agriculture was an issue as well.  He stated if the ditches are not cleaned, they will flood, and then there will be mosquito problems; and then there is a health department issue.  He stated as staff goes through this budget process, they want to be able to communicate to the Board those impacts; and staff would like to provide the Board with a dollar amount, if possible.  He advised there is always a ripple effect to any action the Board takes; and for every line item there is a direct constituent-related item to it.

 

Dr. Marlowe advised, the next key variable as a strategy is built is Core Service and Capacity; County Government does three things; it does a public health and safety function; it contributes to the economic vitality of the community; and it contributes to the quality of life in the community.  He stated all of the County departments work in those three areas; and how those things are impacted has to be understood.  He stated the capacity of those programs that are most core to the Board have to be protected; it is not a simple economic development versus public safety versus quality of life; it is how all three things fit together and how they are moved forward; and as the Board sees ideas come forward, they will be out of that framework in the sense that the current capacity needs to be protected, because it is most significant.  He stated the last variable is called a Tipping Point, which is a point a which a budget for a program is reduced to a level where the program is no longer viable and should be discontinued; the Board has to think about that as it goes through the budget process; an analysis will be done with staff to determine the tipping point; a program can still be viable if it has 80 percent of its resources; but if a program only has 50 percent of its resources, then it may no longer be viable.  He stated with those three ideas, staff will do some budget review; in addition to speaking with the Board, staff will speak to the citizens; and he wants everyone to understand the challenge and task that is about to be undertaken.

 

Mr. Jefferson stated staff is well into the budget process; there are a lot of variables that still have to be considered; all of the departments are scheduled to have their budgets turned in by May 14th; but there will still be outstanding budgets, such as the Sheriff's Office, and some other constitutional officers; the Sherriff's budget is scheduled for the June timeframe; and the certified taxable values will not be in until the July timeframe.  He stated there are many different variables to consider in order to develop the budget for the Board; staff still does not know the impacts from the legislative session; and once those are understood, staff can start developing a budget to bring back to the Board for consideration.

 

He stated some budget challenges include rising unemployment, foreclosure, economic uncertainty, declining revenues, State budget deficit, unfunded mandates, and increasing service needs.  He stated the property tax outlook for 2011 is projecting a 12 percent decrease; for 2012, a 10 percent decrease is projected; and it is not intended to bottom out until 2013.  He stated the projected General Fund revenues for the base year of 2010 is a $217 million budget, but over time it will decrease; it is projected in 2011 to be a $37.5 million shortfall; in 2012 it will be a $17.9 million shortfall; and there is zero growth projected for 2013.  He stated some of the budget balancing strategies include planning tools, such as 20 percent and higher budget reduction scenarios, and a requested 15 percent reduction scenarios from Charter Offices; and other strategies include no salary increases or cost of living adjustments, no new positions, no new programs or services, no new capital improvement projects, reduced funding for capital outlay, and elimination of discretionary spending.  He stated the adopted FY 2010 budget is $1.093 billion; there are two categories, which are the General Enterprise/Internal Service, and Special Revenue, which is $580 million; and that is the recurring type of operating revenue.  He noted, balance forward and transfers are non-recurring types of activities at $512 million; and those are not necessarily there every year.  He advised, of the FY 2010 adopted budget, $363 million is Enterprise, Internal Service, and Special Revenue; it represents 63 percent of the $1.093 billion budget; and General Revenue is $217 million, representing 37 percent of the budget.  He stated of that $217 million, $106 million goes to the constitutional officers; another $11.9 million is for State mandates; the County has to make the payments on those State mandates; another $1.8 million is Court Services; $2.7 million is for outside agencies; and the Board departments are approximately $94 million.  He stated when staff talks about these budget strategies and ways to achieve or address that shortfall, on the Board side it is $95 million in play; and that only represents 42 percent of the $217 million. 

 

Chairman Bolin stated at this time, staff has the State mandate at five percent; but that is what staff is waiting to find out about; and that percentage could be changing drastically and go a lot higher. Mr. Jefferson stated this is based on what staff has currently budgeted for; and as staff gets into 2011, it could be much higher.  Chairman Bolin stated some of them could be funded mandates, but the majority of them will be unfunded.  Mr. Jefferson advised the majority of them will be unfunded. 

 

Dr. Marlow stated what staff has captured are the hard State mandates, which are mandates the Board actually has to write a check for; staff did not capture other mandates that the Board has a choice about the level it does, whether it spends $100 or $1,000.

 

Mr. Jefferson stated as the Board knows, the courts are funded in many different ways; the County provides court facilities, and different types of activities; the County is providing another $1.8 million to the Courts directly from the General Fund to help and support some of the judicial activities that are going on.

 

Mr. Tipton stated, as a reminder, a lot of the judicial expenses came about as a result of Revision VII to Article V, which was something that was voted on in 1998, in which there was a push to make sure that the State court system was paid for by the State; it passed, but in doing so, somehow those costs continued to be shifted to the counties and local governments; and that was implemented in 2004.  He advised the State has said that the County’s investment in the judiciary and in the justice system needed to be held constant at that point and then each year after that would increase by 1.5 percent, as a continuing commitment to the needs of that very important area.  He stated it is a functional mandate.

 

Mr. Arrington stated the legislature got irritated with Florida counties in the late 1990's when this referendum went out; it really turned the tables and put the pressure right back on the counties; that is now dying out a little bit; but the bottom line is that the Board still has a major obligation to fund Courts.  He stated many counties ask what it is going to take to make sure they have a viable, functioning court system that works well for the citizens; sometimes discretionary investments can be made in the court system that might save money downstream, depending on how it is done; it is not like it is all done by mandate, although some of it is; and it is going to be an increasingly burdensome expense on county governments. 

 

Mr. Tipton stated in the next five years, he would hazard to guess that the County will likely be under construction for an addition to the courthouse because the judgeships that are certified that have been unfunded over the last couple of years as the State’s balance continues to improve, are going to be funded; and the County is going to have to find space for them and make some decisions as to where certain services will be located.  He stated in the next five years it is likely that Sheriff Parker will need possible additions to the jail as the population continues to grow; and in the next five years, as the County builds its capital plan, it has to start including how it is going to meet some of the growth needs that are out there. 

 

Commissioner Infantini stated there has been some discussion in the past about judges sharing courtrooms instead of them having their own; the judges are not in their courtrooms five days per week; and this is a good opportunity to approach the judges and let them we do not have any funding, but there are going to be more positions, and they are going to have to share office space.  She stated as far as the jail being overcrowded, she would suggest that instead of taking everybody to jail, just writing them a ticket and asking them to show up in court, rather than having all the processing that increases the statistics and the flow of the numbers; and the numbers can be reduced, and more deputies can be on the road protecting people rather than transporting misdemeanor or DUI suspects. 

 

Commissioner Anderson stated he had the opportunity to meet with a couple of judges the other day; one of the things they tried to relay to him was that some of the positions the Board funds under Court Services generate revenue through their activities; and inquired how that is calculated.  Mr. Jefferson stated staff is still working through some numbers with the judges; but they could have been alluding to the traffic hearing officer program; by having those positions, they are able to get the cases through quickly, which allows the County to gain revenue for court facilities; and staff is still working through some numbers with them to see the overall impact.  

 

Mr. Arrington stated this particular area of potential collaboration with the constitutional offices of the courts has the potential for not only saving substantial dollars in the court system and the criminal justice system in general, but it is one that the Board would want to give a lot of attention to in a collaborative way, because the Board is not directly responsible for these things; but it does have a dog in the fight because it has to levy the taxes to support it.  He stated many counties have made strategic investments in alternative programs; and systemic tweaks can cause the numbers in the average daily jail population to decline, which is a direct bottom line cost savings.

 

Mr. Arrington stated in addition to stakeholders, there are other relationships the Board has that can have a major impact on the jail costs in particular; and that is with the human service community, substance abuse, and mental health in particular.   He stated there is now a statewide bi-partisan effort with business people and other coming together in a coalition to try to figure out ways to cut down on recidivism; part of it is better treatment, alternatives for people who are sick, either with addiction problems or mental health problems, or both; and part of it is working with people who are coming out of the system so that they do not go back into it.  He stated every analysis that has been done demonstrates that if substance abuse and mental health disorders are not treated in a rational fashion, the jail population is going to skyrocket; treatment would cost several thousand dollars less than what it costs to run the jail; the strategy should be to put the Board’s money where it can save the most and do the most good for people consistent with the dispensing of justice in a way that is acceptable to the people who are responsible for it; and that takes a lot of strategy and a lot of collaborative effort across a number of people who have to learn to work together in these matters.  He stated he thinks Brevard County has a culture of doing that, and hopefully in the future it will continue to do that. 

 

Dr. Marlowe stated, putting the current financial challenge into context, what there is, is a $37 million shortfall; there is $14 million that the Board cannot play with because they are State mandates or Court Services; the Board requested 15 percent scenarios from the constitutional offices, which is approximately $15 million; and that leaves approximately $22 million on the Board side.

 

Mr. Jefferson stated the $95 million on the Board side is broken down into categories; today, the Board will be talking about Management Services, which represents approximately $4.6 million of the $95 million; Health, Community, and Economic for $4.7 million represents another five percent as well; Infrastructure, Transportation, and Environment is $22.2 million, representing 23 percent; Public Safety is $13.8 million, representing 15 percent of the $95 million; Culture and Recreation is $14.2 million, representing 15 percent; and another 37 percent of the pie is reserves and debt payments.  He stated when looking at the $95 million, the Board will see the categories staff is working with to go through and develop the budget; and the Board has debt payments it has to make, which is approximately $6.5 million.  

 

Dr. Marlow inquired, assuming the Board wants to meet its debt payments, how much is that of the $35 million.  Mr. Jefferson replied, it is $6.5 million of debt services; and CRA’s are approximately $4.4 million.  Dr. Marlowe stated approximately $10 million of that is legally obligated, so the Board has approximately $25 million to work with.  Mr. Jefferson noted there is $15.2 million in reserves. 

 

Mr. Tipton inquired if the reserve amount is what the Board currently has, and if it includes the obligation to Embraer the Board discussed at the last Board meeting.  Stockton Whitten, Assistant County Manager, advised the $15 million does include the Embraer $1.8 million; just to make sure there is no misunderstanding about that, that is a budgeted reserve for the end of this fiscal year; and it is to be budgeted for the end of this current fiscal year. 

 

Commissioner Nelson stated he knows there are some mandated reserves associated with debt payments; there are other operating reserves that were never required but now exist; for instance, in Parks and Recreation, they have some operating reserves; it was a function of the referendums and not any Board decision particularly; and it was collection during the boom time of some extra dollars.  He stated his question to the Board would by why is it hanging onto reserves in an area that was never required, it was never a direction of the Board, as opposed to using them in a time when the reserves are needed;  it is one thing to have reserves that are required and to hang onto those reserves for that purpose; but then to have a reserve that was never required and to hold onto it, seems counterintuitive to shut down facilities and hang onto a reserve; and that does not seem to make sense to him.  He stated shutting down a facility is always an option, but it would seem to him that this is what reserves truly are for; the Board is in a position where it is fortunate to even have those, because for 20 years, it did not; and it was never a conscience decision of the Board to create a reserve for these departments; it was a fluke; and why not take advantage of that in a positive way. 

 

Commissioner Infantini stated it really was not a fluke that the Board has the additional reserves in Parks and Recreation; there was a certain stated amount that the Board was told it would take to complete the referendum projects; the Board went out and borrowed almost twice as much as it needed; and she wanted to make it clear that the Board actually just over-borrowed. 

 

Commissioner Nelson stated they are dollars that were collected on the maintenance side, on the operating side, out of a different portion of that millage, and are not associated with the borrowing; and these are dollars collected on the maintenance portion of that millage, not on the capital side of the millages. 

 

Mr. Tipton stated perhaps another example is that there are other departments that have reserves for other reasons; some of them may be legal challenges; he met with the Mosquito Control Director yesterday to look at trying to more accurately forecast the needs of that department; they had set aside for legal challenges over mosquito impoundments and some other things; and it is a very healthy exercise to go back and reevaluate those each year, because situations change and conditions change.  He stated staff wanted to take a look at where those reserves are; sometimes there are very good reasons for them; sometimes there are known challenges out there that are coming up, and so those are budgeted for; but other times, those are either far out or perhaps did not materialize as the Board had envisioned; and there is an opportunity to go forward and examine that. 

 

Commissioner Fisher inquired if the Board ever looked at the legal challenge on whether it has a profitable side of the organization, such as Solid Waste, if it can be moved to other areas of the organization that is not profitable right now.  County Attorney Scott Knox replied staff is still looking at that; but a firm conclusion has not been found yet. 

 

Commissioner Anderson inquired if non-obligated reserves are approximately $13.5 million; with Mr. Whitten responding yes, the Board has approximately $15 million un-obligated reserves.  Commissioner Anderson stated the Board had that discussion about what it would need in case of an emergency such as another hurricane; and inquired if staff has that number yet.  Mr. Whitten stated when there is a State of Emergency, there is FEMA and other State resources; the reserve, primarily for the Board, would be an issue of cash flow; it is those dollars that the Board needs to operate prior to the tax revenues coming in; staff is still looking at that figure; that figure goes down as expenses go down; but that is the most important use of reserves, at least for the Board. 

 

Mel Scott, Assistant County Manager, advised one of the challenges coming from the State's predicament, is that in the past, the State has helped tremendously in the local governments' need to have match to take advantage of recovery dollars at the Federal level; and staff is hearing from Tallahassee that if Brevard got hit bad this summer, that it might not have those State dollars to help out.

 

Commissioner Infantini stated she disagrees with Commissioner Nelson that the Board should be using its reserves for ongoing operations; reserves should be saved for emergencies; an emergency is not ongoing expenditures; and she would really like to encourage the Board not to use the reserves going forward to operate, but it should be using current revenue to meet current expenditures. 

 

Commissioner Fisher inquired if the Board has the ability to operate the County without using reserves.  He stated to him, it seems like there is always going to be a cash flow issue about when the Board collects revenue from the Tax Collector; he does not believe the Board has cash sitting in the bank that it can continue to operate from and just pay the bill every time it comes in; and somewhere down the line the Board is waiting on some cash flow to come to it so it can continue to pay our obligations.

 

Mr. Whitten stated county government is a business unlike any other business; and the organization has a history of using the balances forward for the first three months of the fiscal year; and so, it is easy to get confused on reserves and balances forward; but when going back and looking at the history of the organization, there needs to be a certain savings each year to be able to get to the point where recurring revenues are coming in.  He stated if the organization was built without a certain reserve, or balances forward, to get the Board to that point where the recurring revenues are coming in, then the Board is building reserves on top of reserves; and the question is what is that tipping point that the Board needs to have the amount of dollars that it needs to have in the bank so that it does not borrow; but the Board is using those to fund operations in the beginning of any fiscal year.

 

Commissioner Fisher stated what Mr. Whitten is saying is that October 1^st, when the budget starts and the Tax Collector starts sending out tax bills due in November, some people do wait until January or February to pay that bill; that means the County does not have that revenue in its pocket right now, yet it still has an obligation to run the County; so the County has to have some money in the bank to pay the bills; it might have been projected in October that the County is going to pay October’s payroll with money it received in January; but until that money comes in, the organization still needs to operate; and the Board is taking reserves to pay the October payrolls. 

 

Mr. Whitten stated the tax bills are not due until November; the State revenue and the shared revenue sources are in arrears; the Board is two or three months in receiving the October payment from the State for those October receipts, so it is a combination of both; and the Board always needs to utilize some of its fund balances if it is going to run the business to where that tax rate is going to be at a level to where it is not taxing to put savings on top of savings.

 

Mr. Tipton stated one of the key variables in the budget is the Board’s spending; the Board is currently trending at approximately 90 percent spending; so the Board is saving 10 percent over what was budgeted, and staff is trying to ratchet that down a little more; but that is also part of building up that cash brought forward that allows the Board to meet some of the cash flow concerns that have been discussed previously; and that is also part of the overall strategy. 

 

Mr. Arrington stated everybody in the discussion is correct, it is just that it is all about semantics in some way in understanding what is meant by the term ‘reserves’; if there are reserves continuously budgeted, those are set aside for the unknown that could happen; they are not the only funds that are available for that, but they are the main funds for that; but every general purpose government that he is familiar with, budget fund balance every year as a revenue source for the purposes that have been discussed today; and that is not unusual.  He stated what the Board has to be careful about is that the amount of fund balance that it is budgeting as a revenue source is fairly predictable year to year; if the Board budgets fund balance that portion of which is not recurring, that is where it runs into its problem the following year; it is not that the Board does not want to budget the fund balance, the question is if it can do it prudently and as the best revenue projections that it can make; and the Board should always want to have some budgeted reserves for contingency inside its budget to protect against the unknown. 

 

Dr. Marlowe stated unlike an employee who gets paid every two weeks, the County essentially gets paid two or three times per year; it has to manage that money throughout the year; enough money has to be saved up in that checkbook in order to get through and get paid again; and that is at the core of the basic challenge. 

 

Dr. Marlow stated Management Services is all of the County’s administrative infrastructure; that is all the stuff that a modern corporation needs to run; and Brevard County is at five percent.  He stated the Board’s goal is always to have that as small as it can because that is its administrative overhead; and inquired if five percent seems like a good number.  Chairman Bolin replied she does not have anything to compare it to.  Commissioner Fisher stated in the business world, it is very low to operate on five percent. 

 

Commissioner Infantini stated if the Board would invest a little more heavily in areas such as the I.T. Department and the Procurement Department, it would actually generate more substantial savings; if the Board put an extra $1 million in I.T. and Procurement, it would probably save $5 million in all of the other categories; and she thinks the Board has downsized in the wrong departments and it has created a great deal of inefficiencies in the other departments because there is a duplication of efforts.  She stated she would suggest beefing up those two departments; and that would decrease the cost of the other departments due to the inefficiencies, permitting software, and things like that.

 

Mr. Arrington stated Commissioner Infantini is correct on that part; given the last two or three years of history where cuts have had to be made, the Board has a lean Management Services investment; but he would like the Board to think that it can always do things better, and it needs to find ways to do things better and for less money; and there are some ideas in this SFA, but there are going to be a lot of strategic initiatives spread throughout this process that are going to take a lot of staff time and effort to analyze, pull together and get ready for more decision making.  He stated that is one area of the organization that the Board does not want to damage and reach that tipping point, because it is going to need that support in the next few years; if the Board refashions the way it does things and begins adjusting to the physical demands that are on it in a rational way, it is going to have to have a lot of staff analysis, a lot of budget analysis, and a lot of procurement practices that are going to be new and different.  He stated one thing the Board will see in a governance strategy is that the whole skill set of the management staff, and others in the organization, that are in support of the management staff, has got to be protected and advanced in a whole new different way, because instead of managing people in programs like it has been doing through a bureaucracy for all these years, all of a sudden a number of people are going to start managing relationships with others as it outsources and as it looks at new relationships with the cities and non-profit sector.  He stated the Board really needs to recognize the value of its management services capacity because if the Board makes mistakes there and cuts too much, it can really be penny-wise and pound-foolish; it does not mean that the Board is going to do everything the same way it is doing it now, because it is not; and there are going to be a lot of changes made, but that is a very important investment that it is making in his view.  

 

Dr. Marlowe stated he works with the United Way, foundations, and public agencies that essentially fund new contracts, but they do not operate a big staff; 10 percent is kind of the rule; folks who come in at eight percent are usually considered very good; and he is most familiar with seven or eight percent being a good overhead right now, but that varies on the type of business.

 

Mr. Arrington stated one thing to remember about percentages is that the five percent in Management Services is not all of the Board’s overhead, because there is a lot of non-personnel, non-management services overhead as well, along with keeping the lights on and the buildings maintained; and the Board has to be careful of these comparisons.  He noted he has looked at the size of the Board’s Management Services staff right now and it is a thin like; and he would be very careful in that area. 

 

Mr. Jefferson stated Health, Community, and Economic Services incorporates Housing and Human Services, Agriculture and Extension Services, Animal Services and Enforcement, Mosquito Control, and Tourism Development.   He stated Housing and Human Services is approximately $1.2 million; and that does not include the State mandates, because that has already been separated out, nor does it include the CBO’s.  He advised, Animal Services is approximately $2.4 million; another $888,000 for Agriculture and Extension Services; the funding for Agriculture and Extension Services is like a leverage; and it is leveraged with the University of Florida.  He stated staff is analyzing all of the activities the Board leverages dollars for, and if there is a Board policy on how it wants to handle leveraging of dollars. 

 

Dr. Marlowe stated if staff takes out the $6 million or $7 million that is debt and obligated, they wind up with approximately $88 million; if the assumption is made that the Constitutional Officers will come up with their $15 million, then the Board has to come up with $22 million, or it could be up to $37 million. 

 

Mr. Whitten stated the reserves have to be taken into consideration.  Dr. Marlowe inquired what number Mr. Whitten thinks staff is working with; with Mr. Whitten responding $73 million.  Dr. Marlowe stated staff is basically talking about 50 percent; thinking about how to do business differently is going to be a big opportunity; that is the challenge and it needs to be framed accurately; it needs to be remembered that these numbers are highly fluctuating; and it is a significant challenge when talking about re-thinking government.

 

Commissioner Anderson stated the CBO is a discretionary fund; and inquired how it can be taken out.  Mr. Jefferson stated staff included them as part of the outside agency; the two areas that he said were really like mandates were the State mandates and the court services; as staff put outside agencies into the SFA’s, they really did not put them in an area at this point in time; but staff is looking at where they can fit; and when looking at Management Services, they are just not represented in the Management Services component of it.  Commissioner Anderson stated that $2.7 million represents discretionary funding that the Board can reallocate.  Mr. Whitten stated that is not to say that it is not discretionary, but the focus was on the internal resources of the departments; and that $2.7 million is merely passing through like an HHS.  Commissioner Anderson stated the Board is talking about the shortfalls the Board is facing; and he does not think it does the Board a service to take $2.7 million out of that pocket.

 

The Board recessed at 10:30 a.m. and reconvened at 10:45 a.m.

 

Dr. Marlowe stated the offices under Management Services include the Budget Office, Central Services, County Attorney, County Management, Human Resources, Information Technology, and SCGTV/Communications, which are the administrative infrastructure; and the primary tie between the departments is that they help everything work. 

 

Mr. Jefferson stated Information Technology is really an internal services fund; it has direct charges to the other departments; it does not have any direct General Fund support; when they do business they are charging departments for their activity; I.T. is not classified as a General Fund supported activity; and I.T. has a budget, it just is not in the General Fund.

 

Dr. Marlowe stated the various programs of the Budget Office include, evaluating and implementing a biennial and zero-based budgeting process, review user charges for appropriateness, assess centralizing financial and purchasing functions, and evaluate mandated and non-mandated services provided countywide. 

 

Mr. Jefferson stated staff is evaluating implementing a two-year budget process rather than a one-year budget process; that will possibly give staff time to start doing some of those process improvements and look for other initiatives moving forward; and other counties statewide are doing a two-year budget process because they want to be able to do some evaluation, financial analysis, and process improvements, so that when the Board is looking for those inefficiencies, it has the staff resources to really evaluate those types of items. He noted staff is possibly going to look at zero-based budgeting and how it fits into an organization; and staff will also look at user fees to determine if they are appropriate.

 

Mr. Jefferson stated the Budget Office will try to determine if it will make sense to assess centralizing financial and purchasing functions, and if it can be done logistically; the Budget Office will determine if it truly understands the mandated and non-mandated services being provided countywide; and it is helpful information for staff to be able to make some informed decisions for the Board.

 

Chairman Bolin stated she has also wondered if some of those mandates that the Board has enhanced to a higher level because everyone likes the quality of life in Brevard County, that they might not need to be at that level.  Mr. Jefferson stated staff can always separate from non-mandated and mandates, and what level the Board wants to fund them. 

 

Commissioner Infantini stated within the Budget Office she would like to see all financial management functions be within the Budget Office, because right now most of the departments have their own little financial management group; and she found one specific department that while presenting their information, they didn’t actually know how to do that, and they had a very large component missing from their calculation.  She stated she knows Mosquito Control just hired a new person in its finance department; she does not know why there cannot be one person for every three or four departments in the Budget Office; then the Board would have the level of oversight and the skill set necessary to make sure that the numbers coming to the Board in the Budget Workbooks are correct, because right now there is no standard for monitoring those; and she does not have the time to go through and verify each and every number that people are claiming it costs them or costs the County.  She stated she things there are some inefficiencies that are not being looked at; and there can be reductions in those areas.

 

Dr. Marlowe stated staff can look at further consolidation options and some other process changes such as activity-based costing. He stated what is being proposed is some process changes, some structural changes, and some new analytical tools that will be given to the Board that will hopefully make it better informed to make policy decisions.  He stated with Central Services, what the Board will see are some consolidation ideas, some restructuring, and there will be some looking at changes of service levels; staff is looking at outsourcing; the Board will need to do a good business case analysis of that; and in some cases it will be to the Board’s advantage, but in some cases it will not. 

 

Commissioner Anderson stated he is assuming the Board will be talking to other jurisdictions about some opportunities with fleet services; and he has talked to some School Board members who may be interested in some things that can be done jointly. 

 

Mr. Tipton advised the County already has a cooperative agreement with the School Board, but most of the municipalities have the same kind of fleet issues and concerns.  He noted there is a mandate coming up that requires vehicles to be washed down, and that water has to be captured and put into treatment; every municipality is going to be faced with that same mandate; and because the School Board is countywide, there may be an opportunity to go ahead and share cleaning stations as a way to mitigate some of the costs. He stated County vehicles carry insecticides and herbicides; and there was a concern over where it was all going when the vehicles were washed. 

 

Mr. Arrington stated not everything being discussed today will be for this year’s budget; some things are going to take time to put together; but if the Board initiates the direction to staff to begin pursuing these, the payoff on some of these is going to be coming next year and the following year as the Board actually works through these issues; and the entire vehicle fleet is not going to be evaluated between now and July.

 

Scott Knox, County Attorney, stated one thing the County Attorney’s Office is looking at is the Enterprise Funds and whether or not some of the money can be transferred into General Fund to help fund the budget; and he can assign attorneys to represent strictly Enterprise Funds, in which case money from those funds can be used to help pay for that attorney.  He stated another thing being discussed is what is called outsourcing, but it is not what he would consider outsourcing; it is the idea that there is specific expertise in the County Attorney’s Office that perhaps other local jurisdictions do not have; the County Attorney’s Office  deals a lot with eminent domain, along with things such as the Burt Harris Act, that no one else has handled; and since the attorneys work for approximately $90 per hour as a group, they could certainly provide that service to other local jurisdictions where there is no conflict of interest involved.  He noted that price is about half of what they would be charged by other outside counsel; if each one of the attorneys who generally work through their lunch hours, and if all the hours were combined together, it is approximately 1,750 hours per year; and that is a substantial chunk of change at $90 per hour.

 

Mr. Tipton stated for the County Manager’s Office, he is looking at the structure of the organization and trying to make sure his office meets not only the current challenges, but also anticipating and planning for the future needs.  He stated he and his staff is looking at countywide policies affecting work schedules and employment status; there are opportunities to look at changes in employment status, and continuing to provide service, but perhaps doing it in a less expensive way.  He stated another idea is to evaluate hours of accessibility to the public to determine the impact of reduced hours or the number of hours that employees are working in certain areas; it is unlikely to be something that can be done across-the-board, but it could be area-by-area, or facility-by-facility; often, County employees are not the only ones in the building; and the range of aspects has to be understood, but those are some of the things he is looking at. 

 

Dr. Marlowe stated with Human Resources, staff looked at volunteerism; the first idea is how to grow the volunteer base and how to manage that, because there are issues there that affect employees; the County has an outstanding rate of volunteerism; and as of the last analysis, the County had approximately $18 million worth of volunteer effort, which is a great contribution by the citizens.

 

Mr. Arrington stated the notion of changing the culture of civic engagement is a nationwide effort that is going on; there is an effort going on in Florida to study the civic health and try to come up with tools and ideas that can improve the way citizens interact with public agencies; and he feels that when citizens are asked to participate, and it is set up in a quality way so that their participation is meaningful, they will participate.  He stated volunteerism and ways and means of developing a better civic culture have got to be high on the Board’s strategic list; not just because it is efficient, but because it improves the quality of governance when more people are engaged in it; and a theme that should run through the entire strategic planning process should be how to have better civic engagement.

 

Dr. Marlowe stated Information Technology is a field the Board can look at outsourcing; there is an idea of looking at a reduction of resources; and there can be discussions about how Information Technology can help redesign the work.  He noted, one way a lot of corporations have used their I.T. systems is to have the customers do part of the work; and the Board needs to think about how to legitimately use technologies such as this to simplify work and shift where appropriate.  He noted that is an area staff and the Board are going to spend a lot of time one because it is one of the leading ways in which to gain productivity while maintaining good qualities of service. 

 

Dr. Marlowe stated some service level reductions are being looked at; that is part of the process; all of the ideas have to be vetted by the County Manager and his staff; and no one should interpret any of the ideas as though they will definitely happen.  He stated another option being studies is the reassignment of functions, and if it would be more effective to reassign the functions somewhere else. 

 

Commissioner Fisher stated often times, in big organizations, there is one spokesperson for every situation; and inquired if the County currently has that in its system, or if each department has a spokesperson.  Mr. Tipton replied, most are functional positions; there may be a senior fire officer on a scene who becomes the spokesperson at that time; the Sheriff’s Office has a uniformed spokesperson; Animal Services has someone who does some of their communication, education, and outreach, as well as be the point person for media contact; and one discussion topic is how to roll that up, whether it is physical or virtual, so that there is a larger capacity within that communications office.

 

Dr. Marlowe stated Health, Community and Economic Development are areas that are tied together by a public health and safety component and an economic development component; agriculture is the second largest industry in the State; it is an enormous contributor to the economy; and those things have both a public health and an economic development to it, which is why they are grouped together. 

 

Mr. Jefferson stated Mosquito Control and Tourism Development have their own dedicated funding sources;  Mosquito Control’s budget is approximately $9.5 million, but that is coming from a different type of funding; and the same is true about Tourism Development, which has a budget of approximately $24 million coming from a different funding source as well.  He noted staff grouped those areas together, but just really wanted to focus on the general revenue component at this particular workshop. 

 

Dr. Marlowe stated a couple of levels of change are being looked at with Animal Services; one issue is that Animal Services is a business that is very much driven by the human population; and the demands in Animal Services are going to go up.  He stated clearly, it is an important service to the public; and it is one that draws a lot of volunteers who are concerned about the care of animals.

 

Commissioner Fisher stated a lot of people are giving up their animals because they cannot afford them anymore; and inquired if Animal Services could charge a fee to take animals.  Commissioner Infantini stated if people are going to be charged to turn in their animals, they might be inclined to take the tags off their dog and let them loose; and she would suggest promoting a spay/neuter program so that there are fewer animals out there; and if it is operated for free, then more people would be inclined to have their pets spayed and neutered, thereby leaving fewer litters of cats and dogs.  

 

Commissioner Fisher stated if someone cares about their pet, and they know that in the long-term that they will save money if they do not have to buy food or pay vet bills, there could be a populations out there that wants to make sure their pet goes to a good home; and that could be a way to generate fees.  Dr. Marlowe stated that is an idea staff can build up to see what can be done.  Chairman Bolin stated people could make a donation rather than pay a fee, towards the immediate care of their pet until it is adopted.  Commissioner Anderson stated there could be volunteer time. 

 

Commissioner Nelson stated it would seem to him that one of the discussions the Board had was partnerships, but he does not see partnerships indicated in the presentation; and he would think this is an area that would be ripe for partnerships.  Mel Scott, Assistant County Manager, stated as staff continues through the presentation, the Board will see partnerships mentioned more often, as it is critical to the success of moving forward. 

 

Commissioner Nelson inquired what does Service Level Review mean.  Mr. Scott replied, for Animal Services, the thought would be that in these budgetary times the Board would start to first look at enforcement and look to maybe get some savings there; by way of example, Animal Services not longer picks up nuisance wildlife; nuisance wildlife represents 18 percent of the animal population in the shelters; and by not picking up or responding to a raccoon, the enforcement side was able to be modified.

 

Commissioner Nelson stated for all of the areas, the Board is going to look at the minimum level of service that is required and what that cost would be; the Board is going to get down to decisions such as if the Board funds kids programs or dogs; he really thinks it is going to be on the level based on what has been seen so far; and he would like to know what those numbers are.  He stated the Board has decided to try to manage the shelters for at least a year; he would not want to take outsourcing off the table; but it needs to be a continuous evaluation as part of this process. 

 

Commissioner Fisher inquired when Animal Services stopped picking up nuisance wildlife.  Mr. Scott replied, October, 2009; but people can call Florida Wildlife Commission and an officer will respond in due time.  Commissioner Anderson inquired, instead of waiting three days for the FWC to remove nuisance wildlife, could the County charge a fee to have Animal Services do it; and another option is to pay a private company.  Mr. Scott responded, ultimately providing that service means at the end of the year it has cost the Board money, even if it is renting out the cage.   

 

Mr. Arrington stated one question is, after the Board goes through service level reductions in several areas of the organization, what is the public response going to be; and no one knows the answer, but there will be a response.  He stated the challenge will be for the Board and other organizations to be flexible enough in the way that it is remaking the organization; when major transitions in service level reductions are made, the challenge is ongoing; and it is going to take adaptation as the Board moves through time. 

 

Commissioner Fisher stated a lot of service reductions will happen; for someone like himself, his taxes will not go down with all of the reductions; and he wonders what the percentage is that that will happen to when factoring in the population and the homesteads.  Mr. Arrington stated that is the heart of the mess that is the property tax system in the State; some of it is brought about by constitutional amendments; some people theorize that the response Commissioner Fisher is talking about will prompt some serious discussion in the State about tax reform, so that property taxes and other taxes can be made more equitable; and right now there is very little the Board can do other than press for change at the State level.

 

Commissioner Infantini stated the opposing point of view to that is that people are being charged more to keep the same level of service; and she would rather have fewer services and keep her taxes the same, rather than having the same level of service and pay more money for it.

 

Commissioner Fisher stated he does not think anyone wants to pay more taxes, but he is comfortable paying the same amount of taxes that he has been paying; there is going to possibly be the opportunity to say the Board is not going to drop to a certain level of service, but keep the amount being paid the same and allow some of the services to continue; and if the millage is rolled up, it is very possible that his taxes will only slightly increase because of it.

 

Mr. Whitten stated there are over 40 taxing scenarios; whereas Commissioner Fisher has been in his home for an extended period of time, his taxes may go up, not as a result of the Board holding the millage rate, but as a result of the differential between those value marks; and the point staff is trying to make is that there is no one-size-fits-all when talking about where the tax rate is.  He noted even when the Board does not go up to the roll up, some people are going to get a tax increase and some people are going to experience a tax decrease.

 

Commissioner Anderson stated there are a lot of people in his District that live in municipalities where they got hit last year; and he is not going to hit them again.  He stated his taxes went up and he has seen a reduction in the level of service; and he is not willing to double whammy those people in municipalities. 

 

Commissioner Nelson stated the counter to that is that if one lives in unincorporated, they are just getting whammied.  Commissioner Anderson stated unincorporated areas have the option to incorporate if they want those services.   Commissioner Nelson stated individually, that is true; but the reality is that is not going to happen; stated Commissioner Anderson is responsible for providing services to those people; and the Commissioners cannot tell someone to go join a city.  He stated the reality is that the Board is going to approve a budget this year; the Board has to make a decision based on that; and the Board provides services on a countywide basis.  Commissioner Anderson stated for the District he represents, he wants to be on record as not entertaining any roll up; and it is not going to happen as long as he represents Melbourne and Palm Bay.  Commissioner Nelson stated all Commissioner Fisher was asking was that he be provided the numbers in that scenario to see what they looked like; and stated he does not think there is a problem with information. 

 

Commissioner Infantini stated she will not increase the tax rates either; and she would like to be on record for that.  Commissioner Fisher stated he is going to stop coming to budget meetings if three Commissioners are deciding what is going to happen.  Commissioner Anderson stated he represents people who pay the highest millage rate already in the County; he cannot give them anymore; and they are paying for a lot of services in the unincorporated areas. 

 

Dr. Marlowe stated he appreciates the statements from the Commissioners, but staff is not asking for that particular direction today.  He stated one of the things he is starting to ask departments about is the bigger picture trends; and some ideas are outsourcing, and certainly the Board’s evaluation of the community services it funds and what return it is getting for its dollar on those.  He stated Mosquito Control is an area where staff had a very efficient idea of changing some of the practices and still be able to cover the same number of acreages at some reduced costs; and it is a great example of good thinking.  Commissioner Infantini stated combining Mosquito Control with Agriculture and Extension Services was mentioned; and she thinks the Agriculture and Extension Services would be better suited to work in combination with Natural Resources because they are all about the environment. 

 

Dr. Marlowe stated Tourism Development has its own driven funding sources that it is looking at; and what staff is doing is looking at some levels of service reductions based on fees.  Mr. Jefferson added, Tourism Development does a lot of partnerships and a lot of leveraging, so those things are ongoing; and as their funding source goes down, they try to leverage more and more with the business community. 

 

Dr. Marlowe stated that concludes the presentation today; and staff will meet with the Board again next week to look at infrastructure, transportation, and environmental issues.

 

 

 

 

 

ATTEST:                                                                     ___________________________________

                                                                                    MARY BOLIN, CHAIRMAN

                                                                                    BOARD OF COUNTY COMMISSIONERS

                                                                                    BREVARD COUNTY, FLORIDA

_____________________

SCOTT ELLIS, CLERK

      

          (S E A L)