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Council Minutes— December 12, 2011
At 7:00 p.m. Mayor Dean Maxwell called the regularly scheduled Anacortes City Council study session of
December 12, 2011 to order. Eric Johnson, Erica Pickett, Brad Adams, Bill Turner and Cynthia
Richardson were present. Nick Petrish and Brian Geer were absent.
Mayor Maxwell introduced Recreation Coordinator Nicole Johnston who reported on the first Wonderland
Walk held at Washington Park on Friday and Saturday nights. Ms. Johnston reported a great turnout both
nights. She thanked Gere-a-Deli, Safeway, The Market and Le Crema for providing refreshments and
also thanked those who decorated campsites including the Anacortes Boys and Girls Club, the Fidalgo
Yacht Club, the Rotary morning club, the Anacortes Police Department and the Robinson family. The
mayor and councilmembers agreed this will likely become a favorite annual event.
Croatian Club Donation of Books to City(Library and Museum)
Jonn Lunsford of the 40-year-old American Croatian Club of Anacortes introduced two of the club's
founders, Nick Mavar and Vlatko Kollega, and author Bret Lunsford to present the City with gift copies of
the club's recently published book Croatian Fishing Families of Anacortes. Bret Lunsford said that the
founders of the club, including Councilmember Petrish, had long thought that there should be a book to
document this vital part of the community's history. Mr. Lunsford said the book benefited from research he
conducted at the Anacortes Museum and Anacortes Library so in return the club wished to make the book
available to both of those research collections. Mr. Kollega and Mr. Mavar presented two copies of the
book to Mayor Maxwell. The mayor recommended the book and its wonderful photos.
Anacortes School District and Anacortes Public Library Presentation: All American Cities Award
Anacortes Children's Librarian Doug Woods introduced MaryJo Christenson, Early Childhood Outreach
Coordinator at Anacortes School District 103. Ms. Christenson briefly summarized the school district's
programs supporting early learning including the school ready program at Whitney Early Childhood
Center, a tuition-based preschool, kindergarten ready assessment, full-day kindergarten, the family
resource center, the Early Learning Partners collaborative program with childcare and preschool
providers in town, and coordinated programs with the Anacortes Library, Island Hospital and local service
clubs. Ms. Christenson the showed a video summarizing the district's investment in making students
school ready and recognizing its community partners in that effort. Ms. Christensen said early learning in
Anacortes has gained national attention. She noted that the two Samish Head Start classrooms are full
with a waiting list and said the Anacortes Schools Foundation recently received a private donation of
$10,000 to the Early Learning Fund that will help get the wait listed children into preschool.
Mr. Woods then explained that those working on early learning in Anacortes want to apply for a
prestigious All-America City Grade-Level Reading Award. The goal is to get all children reading at grade
level by third grade. Mr. Woods said the award requires a community-wide effort focusing on school
readiness, school attendance, and overcoming summer slippage in reading level. The community would
need to create task forces to identify programs the community can provide to achieve these goals. Mr.
Woods announced a meeting on January 18, 2012 at 7:00 p.m. at the ASD 103 board room. He said
community members and leaders will be invited to the meeting and asked for their support and active
involvement.
Mr. Turner endorsed the early learning concept, praised the district's efforts and pledged the support of
his Rotary Club. Mr. Adams said he was encouraged by the coordination with the preschools in town and
asked how reading level will be measured for the award. Mr. Woods said they look at 3rd and 4th grade
reading tests among other data but that to apply for and win the award the community needs to
demonstrate that it has a comprehensive self-sustaining plan in place. Mr. Johnson asked what role city
government and City Council will play. Mr. Woods said involvement from civic leaders is very important to
win the award. Mayor Maxwell said the existing partnership between the school district and the library is a
good start. Mrs. Richardson agreed with Mr. Adams on the importance of reaching out to all the various
adults who work with and care for young children to develop provider skills. Mr. Turner and Mrs.
Richardson commented on efforts by Anacortes organizations to get books into the hands of children.
Anacortes City Council Study Session Minutes December 12, 2011 1
Finance Update
Finance Director Steve Hoglund provided a year end update on the city's financial position. He first
reviewed sales tax, the largest revenue stream in the General Fund. Mr. Hoglund said sales tax revenues
year-to-date through November are already at 116% of the total budgeted for the year and are up 10%
over the same point last year. Next Mr. Hoglund reported that Real Estate Excise Tax (REET) revenues
are at 78% of budget year to date and are 48% below the same point last year. He noted that since REET
funds public works projects fewer of those projects have been budgeted in recent years. Next Mr.
Hoglund reported on impact fees which are restricted for park and street projects. He reported that the
number of building permits is up this year but the size of the projects is down so impact fees are at 60%
of budget year to date and down 16%from the same point last year. However he said the increase in
single family residence permits is good news for the economy locally and nationally.
Mr. Hoglund then summarized General Fund revenues and expenditures by category through November.
He said overall tax revenue of all types is at 100.5% of budget. License and permit revenue is at 94.5%of
budget. Intergovernmental Revenues (including liquor taxes and profits) is at 75% but does not reflect the
fourth quarter installment so should end the year near budget. Charges for goods and services (primarily
overhead accruals) are at 79.5% but do not yet reflect year end reconciliation adjustments. Fine and
forfeit revenue is at 114.4% of budget. Miscellaneous revenues, primarily interfund charges for
Information Technology, are at 100.3%. Overall, said Mr. Hoglund, General Fund revenue is at 92% of
budget at the end of November, right on target. General Fund expenditures through December 7, 2011
are at 94.7% of budget. Mr. Hoglund concluded that by year end both revenues and expenditures should
be right at budget for the General Fund.
Mr. Hoglund then reviewed year to date revenues and expenditures in the other funds. He noted that
some funds appear out of balance due to year end revenues or expenditures that have not occurred yet.
He advised that a 4th quarter budget amendment will address changes in a few of the funds to recognize
unanticipated grant revenue and expenditures and some reallocation of expenditures between funds. In
response to a question from Mr. Adams, Mr. Hoglund explained that Water Fund 401 appears out of
balance because the actual expenditures for the Water Treatment Plant Improvement Project are shown
but the corresponding revenue from last year's bond issue is still in the fund balance. Mr. Turner asked
where the City will stand in 2-3 years if the economy continues on its current course. Mayor Maxwell said
the city is doing fine. He warned that the state has a budget shortfall that will likely cut revenue for cities
but said Anacortes always has a balanced budget and lives within its means. He acknowledged that the
situation is very dynamic and said staff is monitoring and responding as required. Mr. Johnson said the
Finance Committee is expecting an increase in REET next year. Mr. Hoglund discussed some of the
trending tools used to project revenues for future years. The mayor said single family home starts are a
widely used indicator of economic health and that indicates some recovery is underway.
Mr. Hoglund then reviewed the proposed year end budget amendment. Parks Fund 101 will need an
amendment of$25,000 to recognize state grant funding for the Depot project and related expenditures.
Street Maintenance Fund 104 will need an amendment of$80,500 to recognize the additional work the
street maintenance crew was able to accomplish this year which will be covered by cash reserves in that
fund. Arterial Street Construction Fund 105 will need an amendment of$748,173 to recognize
expenditures for the Old Brook Lane project and corresponding grants and general facilities charges from
utility funds to pay for it. Washington Park Fund 107 will need an amendment of $18,000 to cover
increased activity and tax liability at the park which will be covered by a transfer from the General Fund if
needed. Real Estate Excise Tax Fund 335 will need an amendment of$57,306 to transfer REET funds
into the General Fund to pay for the police station boiler and City Hall elevator. Mr. Hoglund noted that
new state legislation allows REET to be used for maintenance on existing capital facilities. Finally,
Ambulance Service Fund 110 needs an amendment of$22,000 for additional callback costs and
unreimbursed supplies which will be covered by a transfer from the General Fund. Mr. Hoglund said if no
other changes arise an ordinance adopting this budget amendment will appear on the consent agenda for
December 19. Councilmembers concurred.
There being no further business, at approximately 8:10 p.m. the regularly scheduled Anacortes City
Council study session of December 12, 2011 adjourned.
Anacortes City Council Study Session Minutes December 12, 2011 2