Holding off on the project will let the city retain more of its general fund reserves for the upcoming fiscal year.
After losing grant funding for the project, and with general fund reserves dipping below the city's comfortable 15% benchmark, the City Commission directed staff to take the Cassen Park floating dock project off its capital improvement plan for the 2018-2019 fiscal year.
The decision to hold back at least $500,000 worth of projects was made at the CIP budget workshop on Tuesday, June 5. The Cassen Park project was one of the most obvious choices for the City Commission, since the cost of the dock equated exactly that amount. Without cutting projects, the proposed $11,248,420 CIP budget would put the city's general fund reserves at 13.69%.
For Ormond Beach Mayor Bill Partington, that number was unacceptable. He said he was shocked staff would bring the City Commission a CIP budget that would reduce the general fund reserve below 15%, which he said is the "Holy Grail benchmark."
“It’s like one of our golden principles, and yet here we are," Partington said.
Ormond Beach Finance Director Kelly McGuire said the budget dipped below the standard percentage due to the City Commission's decision to purchase the Ormond Beach Riverside Church property for $729,000 in all-cash. She said the CIP budget had already been created before the City Commission meeting where the commissioners voted 4-1 to buy the property.
“That’s what ends up causing the general fund reserves to go below a certain level," McGuire said.
City Manager Joyce Shanahan also informed the City Commission that there is no money in the current budget to do anything with the church property this year. In addition to the Cassen Park dock project, the City Commission decided to hold off on $154,000 worth of technology infrastructure projects, to give the general fund reserve some extra cushion.
Some commissioners were also concerned about raising the water and wastewater rates by a joint $1.75 per month, which would return $8.9 million to the city for water and wastewater projects such as the $940,000 design project for total septic to sewer conversion in the north peninsula.
The City Commission appeared split on the rate increase. City Commissioner Dwight Selby, who is an advocate for septic to sewer conversion in the north peninsula, said the city won't get other entities to commit — such as the county — until Ormond Beach prepares "shovel-ready" projects for them to fund.
“If we don’t take this first step, it’ll be one of those things we just keep talking about," Selby said.
City Commissioner Troy Kent said that he did not support a water and wastewater rate increase to convert Ormond-by-the-Sea, which is unincorporated Volusia County, from septic to sewer while there are neighborhoods in the city still on septic, including Oak and Magnolia Avenue.
“I feel like we should probably do it for Ormond Beach residents first," Kent said.
City Commissioner Rick Boehm said that postponing other projects that will be funded through that possible increase might not be a good idea. Unlike other departments, people use water and sewer every day. The rate increase would help fund projects like repairs to water storage tanks and the replacement of the lime slaker unit in the water treatment plant.
"Pushing them back a year because we said: ‘Hey, we don’t want to spend that money now,’ may result in them breaking down during the year, and we got to do it anyway, and may result in lesser service to our people," Boehm said. "Just keep that in mind as you’re thinking through this term.”