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Resolution 2018-30512 RESOLUTION NO. 2018-30512 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ADOPTING THE FINAL BUDGETS FOR THE GENERAL, G.O. DEBT SERVICE, RDA AD VALOREM TAXES, ENTERPRISE, INTERNAL SERVICE, AND SPECIAL REVENUE FUNDS FOR FISCAL YEAR 2018/19. WHEREAS, the City Manager's proposed Fiscal Year(FY)2018/19 operating budget, net of transfers and Internal Service Funds, as amended and adopted at the September 26, 2018 Commission meeting, totals $631,353,000, including the General, General Obligation (G.O.) Debt Service, RDA Ad Valorem Taxes, Enterprise, and Special Revenue Funds, as shown in Composite Exhibit "A"; and WHEREAS, the proposed General Fund operating budget totals $345,645,000; and WHEREAS, the proposed budgets for Enterprise Funds total $209,999,000; and WHEREAS, the proposed budgets for Internal Service Funds, which are wholly supported by transfers from the General Fund, Enterprise Funds, the Redevelopment District, and Special Revenue Funds, total $96,338,000; and WHEREAS, the proposed budgets for Special Revenue Funds total $114,512,000; and WHEREAS, the current 1% Resort Tax Quality of Life allocations, as adopted by Resolution No. 2015-28919, are as follows: 45% allocated for Transportation initiatives in tourist- related areas; 15% allocated equally among North Beach, Middle Beach and South Beach for capital projects that enhance Miami Beach's tourist related areas; and 10% allocated to various arts and cultural programs; and WHEREAS, the FY 2018/19 budget accepts the recommendation of the Finance and Citywide Projects Committee regarding the proposed reallocation of 1% Resort Tax Quality of Life funding, commencing FY 2018/19, to be amended to increase the allocation for Transportation initiatives from 45% to 60% and decrease North Beach, Middle Beach, and South Beach Quality of Life capital from 15% to 10% each; and WHEREAS, in order to utilize the use of prior year fund balance to fund recurring costs in the FY 2018/19 budgets for the Sanitation, Medical and Dental, and Convention Center Funds, the Mayor and City Commission would need to waive the City's established policy of not utilizing one-time, non-recurring revenue to subsidize recurring personnel, operating, and maintenance costs; and WHEREAS, Section 932.7055 of the Florida Statutes sets forth the purpose and procedures to be utilized for the appropriation and expenditures of the Police Confiscated Trust Fund; and WHEREAS, the proceeds and interest earned from the Police Confiscation Trust Fund are authorized to be used for crime prevention, safe neighborhoods, drug abuse education and prevention programs, or for other law enforcement purposes; and WHEREAS, the Chief of Police is authorized to expend these funds following a request to the City of Miami Beach Commission, and only upon appropriation to the Miami Beach Police Department by the City of Miami Beach Commission; and WHEREAS, the Chief of Police of the City of Miami Beach has submitted a written certification (attached as Exhibit "B") which states that this request complies with the provisions of Section 932.7055 of the Florida Statutes and the Guide to Equitable Sharing of Federally Forfeited Property for Local Law Enforcement Agencies; and WHEREAS, the Police Confiscation Trust Fund budgets for FY 2018/19 in the amount of $246,000 shall be funded from State Confiscation Funds in the amount of$56,000 and Federal Treasury and Justice Confiscation Funds in the amount of$190,000, as reflected in the attached Exhibit"B"; and WHEREAS,funds in the amount of$246,000 are available in the Police Confiscation Trust Funds; and WHEREAS, the City of Miami Beach is authorized to assess $2.00 from court costs for criminal proceedings for expenditures for Criminal Justice Education degree programs and training courses for officers and support personnel of the Miami Beach Police Department pursuant to Section 938.15 of the Florida Statutes; and WHEREAS, the Police Training and School Resources Fund is currently funded with the assessed criminal justice education expenditures for the City of Miami Beach pursuant to Section 938.15 of the Florida Statutes, in the amount of$25,000, as reflected in the attached Exhibit"C"; and WHEREAS, the Chief of Police of the City of Miami Beach has submitted a written certification (attached as Exhibit "C") which states that this request complies with the provisions of Sections 938.15 and 943.25 of the Florida Statutes and the guidelines established by the Division of Criminal Justice Standards and Training; and WHEREAS, the City of Miami Beach Police Department intends to utilize the $25,000 for those purposes as authorized pursuant to Section 938.15 of the Florida for education degree programs and training courses for officers and support personnel of the Miami Beach Police Department; and WHEREAS, Section 705.105 of the Florida Statutes sets forth the procedure for unclaimed evidence which is in the custody of the Miami Beach Police Department and permanently vests in the Miami Beach Police Department sixty (60) days after the conclusion of the criminal proceeding; and WHEREAS, $32,000 has been in the custody of the Miami Beach Police Department Property and Evidence Unit in excess of the statutory period set forth in Section 705.105 of the Florida Statutes; and WHEREAS, said funds have vested permanently in the Miami Beach Police Department, and have now been placed in the Police Unclaimed Property Account, as provided by Resolution No. 90-19931, adopted on March 7, 1990; and WHEREAS,the Miami Beach Police Department seeks to purchase those items identified in the attached Exhibit"D"with funds in the Unclaimed Property Account Fund; and WHEREAS, the Miami Beach Cultural Arts Council (CAC) was established by the Mayor and City Commission on March 5, 1997; and WHEREAS, the mission of the CAC is to develop, coordinate, and promote the visual and performing arts in the City of Miami Beach for the enjoyment, education, cultural enrichment, and benefit of the residents of, and visitors to, the City of Miami Beach; and WHEREAS, the Mayor and City Commission adopted the Cultural Arts Master Plan on June 3, 1998, identifying the following program areas for the CAC: cultural arts grants; marketing; facilities; advocacy and planning; and revenue development; and WHEREAS, pursuant to its enabling legislation, the CAC's budget for each fiscal year shall be adopted by the Mayor and City Commission; and WHEREAS, accordingly, the CAC recommends a $1,481,000 budget allocation for FY 2018/19 to continue implementation of its programs; and WHEREAS, from January 2018 through July 2018, the Cultural Affairs staff and CAC conducted its application and review process for its FY 2018/19 Cultural Arts Grant Programs; and WHEREAS, grants panelists, comprised of the CAC members, yielded 44 viable applications; and WHEREAS,the CAC, at its regular meeting on July 12, 2018, reviewed the grant panelists' recommendations and unanimously supported the recommended Cultural Arts awards totaling $850,000 for FY 2018/19, as more specifically identified in the "Adopted FY 2018/19 Funding" column on Exhibit"E," attached hereto; and WHEREAS, the City Manager has reviewed the recommended Cultural Arts awards and concurs with same; and WHEREAS, the Miami Beach Visitor and Convention Authority (MBVCA) was created pursuant to Chapter 67-930 of the Laws of Florida, and Sections 102-246 through 102-254 of the Code of the City of Miami Beach; and WHEREAS, pursuant to its enabling legislation, the MBVCA's budget for each fiscal year shall be presented to the Mayor and Commission; and WHEREAS, the MBVCA has recommended approval of the proposed work plan and budget for FY 2018/19, in the amount of$3,062,000, to continue implementation of its programs as shown in Exhibit"F." NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission of the City of Miami Beach, Florida hereby adopt the final budgets, as amended at the September 26, 2018 Commission meeting, for the General, G.O. Debt Service, RDA Ad Valorem Taxes, Enterprise, Internal Service, and Special Revenue Funds for Fiscal Year 2018/19 as shown in Composite Exhibit"A" (Total Revenues and Expenditures by Fund and Department), Exhibit "B" (Confiscated Trust Funds), Exhibit "C" (Police Training & School Resources Fund), Exhibit "D" (Police Unclaimed Property Account), Exhibit "E" (Cultural Arts Council Grants), and Exhibit "F" (MBVCA) and waive the City's policy of not utilizing one-time, non-recurring revenue to subsidize recurring personnel, operating and maintenance costs for the Sanitation, Medical and Dental, and Convention Center Funds for FY 2018/19, as well as accept the recommendation of the Finance and Citywide Projects Committee regarding the proposed reallocation of 1%Resort Tax Quality of Life funding, commencing FY 2018/19, to be amended to increase the allocation for Transportation initiatives from 45% to 60% and decrease North Beach, Middle Beach, and South Beach Quality of Life capital from 15% to 10% each. PASSED AND ADOPTED this 26th day of September, 2018. ATTEST: Dan Gelber, Mayor 9 fzYC�erk RaZvado, City Clerk �\ B.F' C y APPROVED AS TO P: .. ... y FORM & LANGU• & FO EXECU 0 flit! ,4t..- OR` ORATED; et4 o_ney ,rte I CQ Aitomay Date � C7-12C, COMPOSITE EXHIBIT A REVENUE SUMMARY BY FUND AND MAJOR CATEGORY Fiscal Year 2018/19 G.O.DEBT SPECIAL INTERNAL FUNCTION/DEPARTMENT GENERAL SERVICE RDA ENTERPRISE REVENUES TOTALS SERVICE GENERAL OPERATING REVENUES Ad Valorem Tares $ 179,020,000 $ 179020000 Ad Valorem Capital Renewal&Repl. 748,000 748,000 Ad Valorem PateMeou.Capitol 2400,000 2,400,000 Ad Valorem.Narrovoy Shores 1650130 165,000 Otner loxes 25,262,000 25,262,000 Llcemes one Pereriry 31 454.000 31,454.000 Intergovernmental 12,115,000 13.115000 Charges for Serious 12,503,000 12.503.000 Fines&Forfeits I,B60,000 1.860000 Interest 3rvemos 3,617.000 3,617000 Rents d Leases 5.899,000 5,899000 Miscellaneous 14,116000 14,114000 Resort Tor Connibwion 35.836,000 35,836.000 Other NarrOpemnn9 Revenue 20,650000 20,650.000 FUND TOTAL $ 345,645,000 $ 345,645,000 G.O.DEBT SERVICE FUND Ad Valorem Tones 5,912,000 5912,000 FUND TOTAL $ 5,912.000 $ 5,912,000 RDA FUND-C (m Only AD VALOREM TAXES proem Tous ROA City Center lnel 29,299.000 29.299,000 FUND TOTAL $ 29,299,000 $ 29,299000 ENTERPRISE FUNDS Convention Cerner 19,374,000 Parking 53,609,000 Soorroton 22,392,000 Sewer Operations 50.679,000 Storm Water 29390,000 Water Operations 34,555,000 FUND TOTAL $ 209,999,000 $ 709999,000 INTERNAL SERVICE FUNDS Central Services 1,101000 Fleet Management 11,492.000 Inbrmalan Technology 16,614000 Property Management 9,733 000 Risk Management 19,460000 Medical&Dental Insurance 37,938,000 FUND TOTAL S 96.338,000 SPECIAL REVENUE FUNDS Education Compact 352,000 Renin Ter 89 461000 Tourism&Hespedly Scholarships 174,000 Cultural Am Council 1.481,000 Sustainabilrw 355,000 Waste Haulers 71,000 Nor,endy Shores 253,000 Blsoyne Point 251,000 5th&Alton Garage 632,000 7th St.Garage 3.085.000 Transportation 11,322,000 Tree es 99,000 Commee, arve Tree Truk.Fund 10,000 People's Transportation Plan 4,003,000 P olice CanBmanans-Federal 190,000 Police Confiscations-State 56,000 Police Crash Report Sales 25,000 Police Urcbimed Properly 32.000 Police Tmieeg 25,000 Red Light Camera 1,316,000 Residential Houspng 737,000 3-911 217,000 mbrmatan&Technology Tech 300,000 ▪eop-ABench 60,000 FUND TOTAL $ 114,517.000 $ 114,512.000 TOTAL ALL FUNIS $34Lt4S,000 $ 5,913,000 $ 39,299,000 $209,999,000 $ 114,312400 $705,367.000 $ 96,338,000 Less TO p4.014,0001 GRAND Toru-au FUNDS $6a14sa400 Page 1 of 3 COMPOSITE EXHIBIT A TOTAL EXPENDITURES BY FUND AND DEPARTMENT Fiscal Year 2018/19 D.O.DEBT SPECIAL INTERNAL FUNCDON/DEPARTMEM GENERAL SERVICE RDF ENRRPRISE REVENUES TOTALS SERVICE MAYOR B COMMISSION S 2,416000 $ 1,116,000 ADMINISTRAl1VE SUPPORT SERVICES $ 31044000 CT(MANAGER 4.129.000 COMMUNICATIONS 2.339000 BUDGET&PERFORMANCE IMPROV 1,875,000 INTERNAL AUDIT 832,000 INSPECTOR GENERAL 484,000 ORG DEV&PERFORMANCE INITIATIVES 893,000 Education Compact 352,000 FINANCE 6,]14000 PROCUEMENT 2,55000 INFORMATION TECHNOLOGYIT 1661!000 Teel" 300,000 HUMAN RESOURCES/LABOR RELATIONS 3,003,000 R64 Mona5ement 19460,000 Medical&Dental Instep nce 37,938,000 CITY CLERK 1,755,000 Conal Serena 1,101 WO CITY ATTORNEY 5,818000 ECONOMIC DEV.IL CULTURAL ARTS $ 142,082400 Economic Development HOUSING&COMM DEVELOPMENT 3,624,000 R olbaGel Housing ]3].000 BUILDING 15,243,000 ENVIRONMENT&SUSTAINAB4T( 1.462,000 Tree Preawot! n 99,000 Commeacron.e Tree TWO Fund 10.000 Sustainobility 355,000 PLANNMG 4,686000 Cultural Arts TOURISM&CULTURAL E.ECON.000. 5,373,000 Convention Center 19.374.000 Resort Tax 89,464,000 Toerl Si.&Hospnd11y Scholarships 174.000 ClVowl Am Council 1,481000 OPERATIONS $ 275,602,000 CODE COMPLIANCE 6,215,000 PARKS&RECREATION 58,680,000 AdoptA-Seoeh 60.000 9] PROPERTY MANAGEMENT 33 000 Normandy Shores 253,000 &Goyee Point 251.000 PUBLIC WORKS 15,1]6,000 Sanitation 22,392,000 Sewer 50679000 stnim Water l er 29390,000 Waste 3d,555,000 Waste Haulers 71,000 CAPITAL.MPROVEMENT PROJECTS 5,227,000 PARKING 53,09,000 Sib 8Alton Garage 632,000 635 000 7th Gamge 3. IIe FLEET MANAGEMENT 92000 TRANSPORTATION 11,324,000 PeopleG-Banat renown Plan 4003.000 PURIM SAFETY $ 203,019,000 POL.CE 11?094,000 PoSU Confiscations-Federal 190,000 Police Confiscatons-Sort 56,000 Police Unclaimed Property 32,000 Police Tirol nine 25400 Police Crash Report Soles 25,000 Red Light Camera 1,316,000 FIRE 01551 000 E-91I 217.000 EMERGENCY MANAGEMENT 1,513,000 Page 2 of 3 COMPOSITE EXHIBIT A TOTAL EXPENDITURES BY FUND AND DEPARTMENT Fiscal Year 2018/19 0.0.DEBT SPECIAL INTERNAL FUNCTION/DEPARTMENT GENERAL SERVICE RDA ENTEVRISE REVENUES TOTALS SERVICE CITYWIDE ACCOUNTS $ 12,3SO,000 CITYWIDE ACCTS 10,399,000 CITYWIDE hca&Nmmondy Seo.ei 253,000 CITYWIDE ACCT&O9e.oIn9 Contingency 1734,000 emotion S 3408000 Copinl mew enropleep Fond 0 Info&Comm Technology Fund 300,000 Building Remove 15900D PotAnYou,Ge Capital 2,400,000 Cop nal Renevol5 Replocemeni 748,000 G.O.DIRT SERVICE 5912,000 $ 6912,000 RD4OM m Tranebe only Clh Cent., 39299000 $ 24299,000 TOTAL-ALL FUNDS $ 345445,000 $ 5,912,000 S 29299000 $ 209,999,000 S 114,512,000 $ 705,367,000 $ 94.338,000 Less T,onrhrs (74014,am GRAND TOTAL-ALL FUNDS $ 631,353,000 Page 3 of 3 EXHIBIT B CERTIFICATION I, Daniel J. Oates, Chief of Police, City of Miami Beach, do hereby certify that the aforementioned proposed request for expenditures from the City of Miami Beach Police Confiscation Trust Fund, for the FY 2018/19 fiscal year providing funds for expenditures, complies with the provisions of Section 932.7055(4) (a), Florida Statutes, and the Guide to Equitable Sharing of Federally Forfeited Property for Law Enforcement Agencies. Dani J�Akl C eF of Police Miami Beach Police Department Date Page 1 of 2 Miami Beach Police Department Confiscations - Federal & State Funds FY 2018/19 Adopted Budget Federal Funds (603)• FY 2018/19 Adopted Budget Organizational Development Travel & Off-site Testing $ 70,000 Bulletproof Vest Partnership $ 70,000 Training Supplement to LETTF 50,000 Total Federal Funds (603) $ 190,000 State Funds (607)• FY 2018/19 Adopted Budget Costs connected with the prosecution/processing of forfeitures. $ 20,000 Crime Prevention initiatives & School Liaison Projects 15,000 AR Rifle Program/initiative-City's match for reimbursement of rifles at $500. 15,000 25% of State Funds collected in FY16 to be used for drug abuse treatment, drug 6,000 and crime prevention education and non-profit community based programs. Total State Funds (607) $ 56,000 Total Federal & State Funds $ 246,000 Page 2 of 2 EXHIBIT C CERTIFICATION I, Daniel J. Oates, Chief of Police, City of Miami Beach, do hereby certify that the aforementioned proposed request for expenditures from the City of Miami Beach Police Training & School Resources Fund, for the FY 2018/19 fiscal year, to provide funds for the education of police personnel at various schools, conferences, and workshops and for the purchase of training and operational supplies, is in accordance with the guidelines established by the Division of Criminal Justice Standards and Training, as provided by Section 938.15 and 943.25, Florida Statutes. Danie . bates Chief of Police Miami Beach Poliicce Department Date Pope 1 of 2 Miami Beach Police Department Police Training and School Resources Fund FY 2018/19 Adopted Budget Police Training and School Resources Funds (6081: FY 2018/19 Adopted Budget Education of police personnel at various schools, conferences, and workshops, as well $ 25,000 as training and operational supplies Total Funds $ 25,000 Pape 2 of 2 EXHIBIT D Miami Beach Police Department Unclaimed Property Account FY 2018/19 Adopted Budget Special Revenue Funds• FY 2018/19 Adopted Budget Community Activities $ 22,000 Law Enforcement Equipment and Supplies 5,000 Facilities Maintenance 5,000 Total Funds $ 32,000 Page 1 of 1 EXHIBIT E CULTURAL ARTS COUNCIL GRANTS Adopted Miami Beach Cultural Anchors FY 2018/19 Funding Florida International University- Miami Beach Urban Studios $27,600 Florida International University-Wolfsonian $31,500 Florida International University-Jewish Museum of Florida $26,400 Friends of the Bass Museum, Inc. $29,750 Friends of the Miami-Dade Public Library, Inc. $22,250 Miami Beach Film Society (Miami Beach Cinematheque) $21 ,750 Miami Beach Garden Conservancy $21,750 Miami City Ballet $31,150 Miami New Drama (Miami Theater Hub, Inc.) $26,400 New World Symphony $31,500 South Florida Art Center $25,800 The Holocaust Memorial Committee, Inc. $27,300 The Rhythm Foundation, Inc. $27,600 SUBTOTAL $350,750 Adopted Miami Beach Cultural Presenters FY 2018/19 Funding FILM Center for the Advancement of Jewish Education (CAJE) $19,298 Inffinito Art& Cultural Foundation, Inc. (Brazilian Film Festival) $18,882 Italian Film Festival ( Cinema Italy) $10,333 Miami Gay and Lesbian Film Festival, Inc. $19,298 SUBTOTAL $67,811 MULTI-DISCIPLINARY FUNDARTE, Inc. $18,675 MDC Lye Arts $17,638 Miami Light Project $7,221 National Foundation for the Advancement in the Arts, Inc. (Young Arts) $19,715 University of Wynwood, Inc. (O,Miami) $17,728 SUBTOTAL $80,977 THEATER Fantasy Theater Factory $17,372 Juggerknot Theater Company $18,053 SUBTOTAL $35,425 Page 1 of 2 CULTURAL ARTS COUNCIL GRANTS Adopted Miami Beach Cultural Presenters FY 2018/19 Funding VISUAL ARTS Bas Fisher Invitational, Inc. $17,845 Edge Zones $10,085 South Florida Composer Alliance $20,916 SUBTOTAL $48,846 OPERA Florida Opera Prima, Inc. $13,612 SUBTOTAL $13,612 DANCE Ballet Flamenco La Rosa, Inc. $17,845 Cuban Classical Ballet of Miami Corp. $17,638 Miami Hispanic Ballet Corp. $18,260 Peter London Global Dance Company, Inc. $10,832 Siempre Flamenco, Inc. $10,583 The Dance NOW! Ensemble, Inc. $22,410 SUBTOTAL $97,568 MUSIC Burkerfest Miami, Inc. $6,640 Community Arts and Culture, Inc. $17,638 Global Arts Project $22,161 Miami Children's Chorus, Inc. $7,304 Miami Music Festival $10,707 Nu Deco Ensemble, Inc. $23,500 Orchestra Miami $10,458 Patrons of Exceptional Artists, Inc. $18,468 Seraphic Fire $18,675 South Beach Chamber Ensemble, Inc. $8,964 SUBTOTAL $144,515 SUBTOTAL $488,754 Contribution for VCA/CAC Cultural Tourism Grant $10,496 TOTAL $850,000 Pope 2 of 2 EXHIBIT F ADMINISTRATION RECOMMENDATION Adopt the Budget ANALYSIS BACKGROUND The Miami Beach Visitor and Convention Authority (MBVCA) was created and exists pursuant to Chapter 67-930 of the Laws of Florida and Sections 102-246 through,and including 102-254 of the Code of the City of Miami Beach (CMB). According to Sec. 102-251,the MBVCA is to take"all necessary and proper action to promote the tourist industry for the city, including but not restricted to causing expert studies to be made, promotional programs, the recommendations and development of tourist attractions and facilities within the city,and to carry out programs of information, special events, convention sales and marketing, advertising designed to attract tourists, visitors and other interested persons."The MBVCA also has the duty of making all necessary rules and regulations for the efficient operations of the authority. The MBVCA is a seven-member authority. Each member is appointed by the City of Miami Beach Commission, with the goal of encouraging, developing and promoting the image of Miami Beach locally, nationally and internationally as a vibrant community and tourist destination. To this end,the MBVCA strategically focuses its funding investments in a balanced manner, fostering outstanding existing programs, stimulating new activities, and encouraging partnerships. The MBVCA is committed to a careful, long-term plan for allocation of resources to build the uniqueness of Miami Beach as one of the world's greatest communities and tourism destinations. A budget revenue projection is provided to the MBVCA by the City of Miami Beach's Budget Office annually based on 5% of the 2% Resort Tax, less 4% for administrative allowance. On an annual basis the MBVCA must provide the City with a budget, on City forms, based on this projection as outlined in Sec. 102-252, before October V. The MBVCA normally budgets funding below the City's projection,as the collection of funds can differ substantially from projection, such as the result of unanticipated problems like an airline strike,terrorism,economic issues or storms. In 2008, revenue collections came in $48,000 under estimated projection, and in 2001 the revenue collection was down approximately$300,000 from projection.When and if there are unallocated funds remaining at the end of the budget year,those funds are either rolled over and allocated in the next budget year,or retained in MBVCA accounts for future reserves, endowment funding, to address any funding reductions in future years. In 2001, by statute,the MBVCA began investing into the creation on an endowment fund. The MBVCA is required by law to maintain reserve bank accounts in approved public depositories,with sufficient reserves to cover one year of funding,which it does. Reserves are maintained to pay grant recipients (contracted) for the previous program funding cycle, and to ensure that sufficient funds can be invested to stimulate tourism in the future. The level of reserves was modified in 2011 in order to maximize the value and impact of tourism directed funds. The MBVCA submits an annual Program of Work to the CMB as required by Sec. 102-281. FY 2017/18 REVIEW/TOURISM ADVANCEMENT PROGRAM ITAPI The MBVCA Tourism Advancement Program (TAP) was established to promote Miami Beach as a sophisticated tourist destination by increasing the number of visitors;through enhancement of visitors' experiences; through the allocation of funds granted to events or programs that bring visitors to the CMB and strengthen the CMB brand. In fiscal year 2017/18, the MBVCA funded the TAP in seven categories, including: Development Opportunities, Initiatives, Major One Time Special Event, Special Events Recurring, Special Projects, Special Projects Recurring, and Tourism Partnerships. In 2017, the MBVCA continued to fund projects, utilizing funds Page I of 8 rolled over from several years past. A total of $1,278,750 was awarded in FV 2017/18, compared to $1,528,850 in FY 2016/17. The decrease in awards reflects rescinded events,due to non-compliance or cancellation,and repeat events that could not meet the grant application criteria,and;therefore,could not apply. Grants funded in partnership with the CMB are critical, branded tourism-related programs, such as the South Beach Wine & Food Festival and UNTITLED.Art Fair Miami Beach, both examples of events whose beginnings in Miami Beach stem from grants provided by the MBVCA; events that could easily be recruited by other destinations. FY 2018/19 TOURISM ADVANCEMENT PROGRAM The MBVCA strategically focuses funding to maximize tourism and brand,to improve Miami Beach by focusing on events and projects that generate significant publicity,strengthen brand and increase tourism (generating critical resort taxes for Miami Beach).The Board pays significant attention to marquee events. Review process: For over a decade, the MBVCA has used a multi-level review process for its grant program and the process is reviewed annually. The process includes a mandatory pre-proposal staff conference regarding MBVCA policies and procedures and TAP. During the interview,MBVCA administration advises each potential applicant regarding the eligibility and appropriateness of the proposed project and determines the grant category best suited to the potential applicant. Once it is determined that the project is eligible,the MBVCA administration provides further detail, including required attachments and relevant meeting dates and deadlines and access to the online Application Portal. The applicant is provided with an overview of the application submission process. All applications are submitted through the online Application Portal in a multi-step format. All grant formats and policies are available on the MBVCA website. By Florida law,all MBVCA meetings are advertised and open to the public;all records are public records. Annually,the MBVCA Board reviews and refines grant guidelines with respect to efficacy and effectiveness. In FV 2012/13,the MBVCA implemented changes to its funding caps and declining scale. The new declining scale and funding caps allowed the MBVCA to diversify their funding into other areas and initiatives as requested by the City administration and/or the Board. In FY 2017/18 the MBVCA voted to maintain the criteria in place for the Major One Time Special Event and Special Events Recurring grant categories requiring a total of 350 hotel room nights to be contracted, along with the 1,000,000 contracted media impressions. The viewership criteria remained at 1,000,000.The grant criteria guidelines were further defined for clarity and accuracy, requiring fully executed contracts to be submitted prior to proceeding with the next step in the application process. The application requires contract confirmation for hotel room blocks; media contract agreements, and/or broadcast/cable/TV contracts to in order to proceed with the grant submission. The data must be confirmed before and after funding is awarded. Grant applicants must meet two of the three criteria in place for each of the MBVCA grant categories. MBVCA grants are paid upon performance; therefore, grantees are required to provide post-performance reports in the form of reservation or pick up reports from Miami Beach hotels; impressions reports garnered from the organization's PR Firm,or accompanied by 3rd party confirmation from a media monitoring/press clipping service such as BurrellesLuce to prove media impressions, and a broadcast post performance report from a third party reporting delivery of Adult 18+and Households (HH) in Thousands (000) from Nielsen, Over The Top (OH), or Comscore/Rentrak for viewership. The defined criteria and specific post- performance reporting structure will be further defined and continued in FY 2018/19. The MBVCA guidelines and application process place emphasis on defining and measuring the economic impact of each event, as well as considering the impact and value of marketing, publicity, and television origination/viewership. Questions concerning the economic impact of the program, including requiring an Page 2 of 8 explanation of various aspects of the marketing plan, and how the numbers of hotel room nights are calculated and where they are contracted,are also required as part of the application.The event's or organization's publicity plan, community and residential involvement, and/or special residents' considerations must also be provided. Standardized recap sheets and point systems have been developed to give each applicant a score that rates potential success. In 2016/17, a revamped point system was implemented to be more closely aligned with the MBVCA's grant criteria and will continue to be utilized in FY 2018/19. Using this tool, the MBVCA can better evaluate the applicant's long-term commitment to the community;commitment to brand enhancement;value to tourism, and economic impact. The MBVCA votes on each specific and individual grant, and evaluates the grant request,funds available and possible extenuating circumstances after a formal presentation is made by the grant applicant.A question and answer period follows,with further discussion as needed. RECURRING PROJECTS: The MBVCA has a current policy in place to fund recurring projects on a declining scale. The declining scale encourages recurring events to recruit corporate and private sponsorship and; therefore, not solely rely on MBVCA funds as a means of sustaining the event year after year. The award category establishes funding caps for recurring events, funding that can be reduced based on the maximum request for the specific grant category. Below is the current scale, implemented in FV 2012/13; applicable to non and for profit agencies. The declining scale will remain in place for FV 2018/19. Year 1 Initial Grant Award Year 2 No more than 80%of Eligible Request Year 3 No more than 70%of Eligible Request Year 4 No more than 60%of Eligible Request Year 5 New Cycle Begins CATEGORIES: TAP funds are currently awarded in nine categories,including: Cultural Tourism,Development Opportunities,Film Incentive, Initiatives, Major One Time Special Event, Special Events Recurring, Special Projects, Special Projects Recurring, and Tourism Partnerships. The MBVCA has developed pre-eligibility criteria for grants within these categories.The criteria allow staff to determine eligibility and the appropriate grant category. Applicants must meet two of three of the criteria noted Grant Category Contracted Contracted Media Contracted Television and/or Hotel Room Nights Impressions Cable Broadcast Initiatives" N/A N/A N/A Cultural Tourism 250 750,000 1,000,000 Development 75 200,000 500,000 Opportunities Film Incentive" 250 N/A N/A Major One Time Special 350 1,000,000 1,000,000 Event Special Events Recurring 350 1,000,000 1,00Q000 Special Projects 2,500 250000,000 15,000,000 Special Projects 2,500 25Q000,000 15,000,000 Recurring Tourism Partnerships 200 500,000 5,000 (visitors/attendees/participants) *Initiatives are specifically targeted towards organizations chosen by the MBVCA to carry out the designated initiative "Specific requirements are in place for the Film Incentive Grant Program. Page 3 of 8 Budget Budget(TAP)FY 2018/19: The MBVCA has budgeted $1,883,500 for FY 2018/19 for its Tourism Advancement Program which reflects 62% of the total budget. This grant funding reflects an increase of$183,000 from FY 2017/18. This increase is due to an increase in the amount requested from some repeat applicants being moved to the top of declining scale as well as the revitalization of the Cultural Tourism Grant and the Film Incentive Program. • The Tourism Partnerships category is budgeted at $120,000, reflecting 4% of the total budget for FY 2018/19. The category currently includes applicants at the maximum request cap of $30,000. Four applications are anticipated to be received. • The Major One Time Special Event category, representing 4% of the total budget, is budgeted at $135,000 in FY 2018/19,which reflects a 25% decrease from FY 2017/18. The MBVCA expects three new events to apply at a maximum request of$45,000. The MBVCA works tirelessly to stimulate and recruit new events and is willing and prepared to fund valuable tourism and brand related events. In fact, the MBVCA works with all partners, city leadership and media to solicit appropriate new projects. New applicants are expected to include the ITF(Juniors)Tennis Tournament, and two additional projects. • The Special Events Recurring category, reflecting 25% of the total budget, has been calculated at $768,000 for FY 2018/19 based on the established declining scale and the number of applicants anticipated to return. • The Special Projects category is budgeted at $180,000 with two applicants expected at the maximum request of$90,000 representing 6%of the total budget. • The Special Projects Recurring category is budgeted at$280,500 and represents 9%of the total budget. Anticipated applicants include the Orange Bowl Marketing Campaign; lifetime Miami Marathon, Half Marathon, and Tropical 5K; the Food Network & Cooking Channel South Beach Wine & Food Festival; Swim Fashion Week Miami Beach Paraiso; and Winter Music Conference. These events, recruited and sustained by the MBVCA,are all marquee events and annually fill the City's hotel rooms. • The Development Opportunities category is budgeted at $60,000 for FY 2018/19, representing 2% of the budget; in anticipation of 2 applicants at the maximum request of$30,000 each. • The Film Incentive category is budgeted at$250,000 for FY 2018/19 representing 8%of the budget. • The Cultural Tourism category is budgeted at$90,000 for FY 2018/19 representing 3%of the budget in anticipation of 3 new applicants. Destination Marketing The Destination Marketing allocation reflects a 4%of the total budget for FY 2018/19.This allocation provides for the additional placement of stories and press releases on the PR Newswire as well as the continuation of our Blogger Program that will be implemented in FY 2018/19. The MBVCA is also partnering with the CMB on an Israeli travel promotion through ad placements in various media outlets. Initiatives The MBVCA expects to support new initiatives in FY 2018/19. Strategic plans, goals and initiatives are developed through consultation, the result of ongoing communications with the Mayor, Commission and City Administration. One of these initiatives includes the continuation of the Forbes Travel Guide Hospitality Training and the implementation of the webinar based on the live training sessions; both offered free of charge to Miami Beach hospitality employees. The live training sessions will be offered 3 times a year with the webinar offered year-round to ensure all Miami Beach hospitality employees benefit from this valuable training. Another initiative is the Miami Beach Visual Memoirs Project that was started in 2011/12 to record,catalogue and warehouse personal and eyewitness accounts of the history of the City of Miami Beach. The deliverables Page 4 of 8 included a recorded detailed history of Miami Beach through personal interviews, creating collateral materials about the history of Miami Beach and identifying comprehensive exhibit concepts that can be implemented to execute a comprehensive visual memoir library and promotional campaign. The Miami Design Preservation League(MDPL) in partnership with Close-Up Productions has conducted a total of 108 interviews to date. Other components of this initiative, include an exhibit opened to the public daily for its initial run from mid-October through late November 2012, free of charge from 10:00am until 4:30pm and reopened during Art Deco Weekend 2013.The documentary played on a loop in the lecture hall portion of the Art Deco Welcome Center. Seating was also placed near the screen and accommodated approximately 25 people at a time with standing room in the back. An educational component was developed for FY 2012/13 that included a video and teacher guide for Miami Beach Middle Schools. In FY 2013/14,the videos were prepared for archival as part of a statewide university consortium. MDPL also collaborated with various institutions to create links to the online materials. In FY 2015/16, MDPL developed a digital promotional portal showcasing the video archive with links highlighting other Miami Beach historical resources, housed at institutions in Miami Beach and Miami Dade County. The "Windows on Miami Beach" portal generated local interest and support through school contests and online displays created by students and joint curating displays by portal partners;offered daily and weekly calendars of partners' events; developed social media linkages that drove people to the new website and its resources; provided easier access to the interviews, educational videos and curricula produced by the Visual Memoirs Project; increased patronization of museums and historic sites on Miami Beach, and promoted Miami Beach as a tourist destination through historic and artistic connections. In FY 2016/17, the project developed a video on Barbara Baer Ca pitman, "Barbara's Crusade", that premiered during Art Deco 2017. In addition,the project's website,miamibeachvisualmemoirs.com,was rebuilt for new and readily expandable internet access. The Project stored archives stored through of FIU's Digital Archive continued to expand through full-length interviews in an effort to stimulate interest in Miami Beach's history and historic venues. The social media exposure also increased attracting nearly 500 followers on their Facebook page. An additional 15 interviews were scheduled with full transcripts, while completing an additional 25 transcripts from past interviews.The ON-MiamiBeach.com Portal added a separate"Learning and Teaching" section that included links to current videos and mini co-cu rations and videos about Miami Beach by the portal partners and students. In 2017/18,the project continued to enhance its community and visitor awareness of the Portal through partner organizations' cross-promotional efforts and increased social media integration. A new set of interviews also took place expected to augment the existing database. In addition, an architectural discussion was mounted at the Wolfsonian Museum during Art Deco Weekend that included leading architects discussing preservation architecture and the combining of styles within the expansion on Miami Beach. The Initiatives category is budgeted for FY 2018/19 at$121,000, representing 4%of the total budget. Public Relations Initiative In FY 2013/14, the MBVCA issued a Request for Qualifications (RFQ) for a P.R. agency of record to enhance Miami Beach's image, after their initial Request for Proposals (RIP) issued in FY 2011/12. The MBVCA selected Hill & Knowlton/SAMCOR (H+K) to support the MBVCA efforts by continuing to increase brand awareness through strategic media outreach to consumer and travel trades, major event recruitment, and business and corporate communications programs. There is an allotment of$250,000, representing 8% of the total budget, towards this effort. Page 5 of 8 The current contract with H+K runs through September 30, 2018 in FY 2017/18. Objectives include increased public relations or tourism related activities in CMB, recruitment of new events and meetings, and improvement of CMB global reputation. CMB leaders have been active participants in planning and in oversight. H+K has an extensive presence in the US and internationally. The agency's ability to network and leverage its global relationships is crucial to the growth of the'Miami Beach' brand. H+K created and distributed a total of 15 press releases and pitches during their first year as agency of record, garnering 3,416,581,560 media impressions and 12 press releases during their second year, generating 3,913,341,910 media impressions. In their third year, H+K generated 2,783,369,818 media impressions through the issuance of 12 press releases and a Harris Poll Survey that was conducted to determine why people visit Miami Beach. During their fourth year, H+K developed and released a total of 12 press releases and 1 pitch, generating a total of 1,492,734,059 media impressions,valued at$15,615,214.75.During its fifth year H+K wrote and released 12 press releases,generating 1,410,465,887 media impressions,valued at$15,638,438.52. During its sixth year,a total of 15 press releases were written and distributed, generating 1,272,729,422 impressions valued at $14,353,222.76. Finally,during their seventh and most recent year,a total of 15 press releases and 1 Audio News Release (ANR)were distributed generating 1,302,477,118 impressions valued at$1,583,728.46. IT Development The MBVCA wishes to provide visitors with timely and relevant information about the City of Miami Beach, its public and private attractions,services,hotels,businesses,and events in order to enhance visitors'(and residents') experiences. Visitors to Miami Beach-all visitors worldwide—are increasingly using technology to navigate cities or make decisions about leisure experiences, dining, parking, entertainment and travel in general. Worldwide, technology is king. Many visitors already use the free Miami Beach Wi-Fi service, CMBWiFi, to access the information they need at select public locations around town. Miami Beach visitors and residents are using smartphones and tablets to communicate and acquire information to make these kinds of decisions on-the-go. It is now critical for these visitors and residents to have access to mobile applications (Apps) that can help them obtain the information they need to make timely and informed decisions. A new version of the App, Miami Beach Information (MBI), was released in fiscal year 2015/16 for both Android and iOS platforms. The latest version of MBI included new and exciting features for the end-user. The newest features included a side-swipe feature; listing the information in an A-Z format; the addition of new categories were added that included Shopping, Nightlife,Art&Culture, and Restaurants,and the creation of"My Miami Beach" section where users can add events, photos, and itineraries as they navigate the App. In addition, the App features a "Deals" section that has special promotional rates or offers developed by MBVCA grantees. This cross promotional effort increases the number of downloads the App receives, while also assisting with the promotion of MBVCA-funded events. The promotions in the "Deals" section were also posted to the various MBVCA social media pages such as Facebook, Twitter, and Instagram. The App has now been downloaded over 12,000 times since 2015, across both mobile platforms. Approximately half of all downloads come from European users seeking to learn about Miami Beach. The first version of the App was released in FY 2013/14. The MBVCA's preliminary review of opportunities and needs was initiated in spring 2011 in consultation with area experts, and subsequent to a public meeting sponsored by the MBVCA, as a situational analysis. The MBVCA released an RFP in January 2012 and awarded a one year contract to Just Program LLC dba Solodev on May 22, 2012. The purpose of the RFP was to develop a Miami Beach-focused web-based digital content management system (CMS) and modifiable database to support 3'd party mobile applications via an application programming interface(API). Currently, the API is fully functional with 250 different categories of businesses, each averaging 90 different services and amenities. Web and App developers are able to use these attributes to create new and exciting experiences for their end-users. A fully functional mobile App for the MBVCA API for both iPhone and Android platforms is also available,free of charge. Page 6 of 8 We have allocated $30,000 or 1% of the overall budget in FY 2018/19 towards IT development, to add additional categories to expand the API database to include local non-business information that can be useful in App development such as beach access roads, public restrooms, and lifeguard stands. A total of$10,000 has been allotted to market and promote the API/App to App developers in FY 2018/19, representing less than 1% of the total budget. Research and Development The MBVCA will develop a strategic list of major events worldwide as the result of ongoing communications and consulting with all partners. We expect to investigative some of these events with the goal of the development of a new major event for the destination. The MBVCA has budgeted $5,000 of the total towards this effort. Projected Cash Flow Reserve The MBVCA has budgeted $2,000 of the total budget,for cash flow reserve in FY 2018/19. The City of Miami Beach allots resort tax payments to the MBVCA a month after its collection; therefore, as a fiscal responsibility, the MBVCA has built in a projected cash flow reserve to its budget to ensure that all grants awarded will have the necessary funds to be reimbursed upon proper request and documentation. Administration and Overhead The MBVCA's administration and benefits costs are budgeted at$420,000 for FY 2018/19.This figure represents 14%of the total budget. The overhead allocation is budgeted at$215,500 which reflects 7%of the overall budget.The increase from FY 2017/18 is attributed to the cloud information hosting and redundancy, the addition of office security measures and staffing a full office.The total administration and overhead is 21%of the total budget. Rollover A total of$200,000 will be rolled over from FY 2017/18 into the FY 2018/19 MBVCA budget to fund special projects.This rollover of funds is primarily from the grants that were either not awarded and/or were rescinded for noncompliance. CONCLUSION At their July 24, 2018 meeting, the MBVCA Board recommended the Mayor and City Commission adopt the MBVCA Budget for FY 2018/19 in the amount of$3,062,000 as reflected in the following table. Page 7 of 8 MIAMI BEACH VISITOR AND CONVENTION AUTHORITY Pt 2018/19 ADOPTED BUDGET ADOPTED FY 2017/18 FY 2018/19 VARIANCE REVENUES Unrestricted Rollover $ 200,000 $ 200000 $ - ProjectedResortTax $ 2,708,000 $ 2,862,000 $ 154,000 TOTAL REVENUES $ 2,908,000 $ 3,062,000 $ 154,000 EXPENDITURES Administration&Benefits $ 415,500 $ 420,000 $ 4,500 Operating Expenses $ 215,000 $ 215,500 $ 500 Capital $ 5,000 $ 5,000 $ Total Administration $ 635,500 $ 640,500 $ 5,000 GRANTS -Tourism Advancement Program Tourism Partnerships $ 120,000 $ 120,000 $ - MajorOneTimeSpecialEvent 5 180000 $ 135.000 $ 05,000) Special Events Recurring 5 896,000 $ 768.000 5 (128,000) Special Projects $ 180,000 $ 180,000 $ - Special Projects Recurring $ 314,500 $ 280500 5 (34,000) Cultural Tourism $ - $ 90,000 5 90,000 Film Incentive $ 250,000 $ 250,000 Development Opportunities $ 10,000 $ 60000 $ 50,000 Total Tourism Adv.Program 5 1,70,500 $ 1,883,500 $ 183,000 Marketing/PR/Technology Marketing/Communications and PR 5 250,000 $ 250,000 $ APP Marketing $ 10000 $ 10,000 $ IT Development $ 30,000 $ 30,000 $ - Total $ 290,000 $ 290,000 $ - Other Destination Marketing $ 135,000 $ 120,000 $ (15,000) Initiatives $ 140,000 $ 121,000 $ (19,000) R&D $ 5,000 $ 5,000 $ - Projected Cash Flow Reserve $ 2,000 $ 2,000 $ Total Other $ 282,000 $ 248,000 $ (34,000) TOTAL 5 2,908,000 $ 3,062,000 $ 154,000 Page 8 of 8 Resolutions - R7 B MIAMI BEACH COMMISSION MEMORANDUM TO: Honorable Mayor and Members of the City Commission FROM: Jimmy L. Morales, City Manager DATE: September 26, 2018 5:01 p.m. Second Reading Public Hearing SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ADOPTING THE FINAL BUDGETS FOR THE GENERAL, G.O. DEBT SERVICE, RDA AD VALOREM TAXES, ENTERPRISE, INTERNAL SERVICE, AND SPECIAL REVENUE FUNDS FOR FISCAL YEAR 2018/19. RECOMMENDATION See attached Memorandum. Legislative Tracking Budget and Performance Improvement ATTACHMENTS: Description ❑ MEMO - FY19 Final Operating Budget- Second PH o Resolution Page 57 of 366 City of Miami Beach,1700 Convention Center Drive,Miami Beach, Florida 33139,www.miamibeachfl.gov COMMISSION MEMORANDUM TO: Mayor Dan Gelber and Members of the City Commission FROM: Jimmy L. Morales, City Manager DATE: September 26, 2018 SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ADOPTING THE FINAL BUDGETS FOR THE GENERAL, G.O. DEBT SERVICE, RDA AD VALOREM TAXES, ENTERPRISE, INTERNAL SERVICE, AND SPECIAL REVENUE FUNDS FOR FISCAL YEAR 2018119 ADMINISTRATION RECOMMENDATION The Administration recommends that the City Commission adopt the attached Resolution which establishes final budgets for the General, G.O. Debt Service, RDA Ad Valorem Taxes, Enterprise, Internal Service, and Special Revenue Funds for Fiscal Year (FY) 2018/19. PROCEDURE As outlined in the companion General Operating Millage Agenda Item, Section 200.065, Florida Statutes, specifies the manner in which budgets are adopted. First, the final millage rate for both the general operating and debt service is adopted, then immediately thereafter, the final budgets by fund are adopted. The attached Resolution adopting the final budgets for the General, G.O. Debt Service, RDA Ad Valorem Taxes, Enterprise, Internal Service, and Special Revenue Funds for FY 2018/19 is, therefore, presented to you at this time for adoption. Additional details are contained in the Budget Message included in the Proposed FY 2018/19 Operating Budget document; however, highlights of that document are outlined below. GENERAL FUND BUDGET DEVELOPMENT As in past years, the Work Plan and Budget was developed through an intensive review process with our City Commission. Preliminary budget information was provided at the Commission Budget Workshop on May 24, 2018 and in meetings with the Finance and Citywide Projects Committee ("the Committee") on June 8, 2018, July 13, 2018, July 20, 2018, and July 27, 2018. The General Fund is the primary source of funding for the majority of City services. Revenues are derived from ad valorem property taxes, franchise and utility taxes, business license and permit fees, revenue sharing from various statewide taxes, user fees for services, fines, rents and concession fees, and interest income.Additionally, intergovernmental revenues from Miami-Dade County and Resort Tax contribute funding for tourist-related activities provided by General Fund departments. Page 58 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 2 At the May 24, 2018 Budget Workshop, and at the June 8, 2018, July 13, 2018, and July 20, 2018 Budget Briefings, the City Commission was briefed regarding the preliminary FY 2018/19 General Fund budget. The preliminary budget represents the cost of providing the same level of services as in the prior year and serves as the baseline of funding for the budget process. At the July 20, 2018 meeting, the Administration identified refinements to the budget based on direction given at the July 131^ meeting. These recommendations, if approved, would have resulted in a balanced budget as noted below. Balancing Strategies $ July 1 Preliminary Gap (4,553,000) Recommended Reductions 1,716,000 Recommended Revenue Enhancements 1,094,000 Recommended Enhancements (1,981,000) Revenue Refinements 1,485,000 Transfer in from Parking 1,166,000 Other Expenditure Refinements - Less One-time Expenditures 1,073,000 Surplus/(Gap) - The Committee accepted the Administration's budget-balancing recommendations as outlined above and recommended funding the following additional enhancements: • Additional Park Ranger coverage on the Beachwalk (for South Pointe Park to 461^ Street, including Collins Park): $322,000 • Park Ranger coverage at the Barry Kutun boat ramp: $100,000 • Increase in the City's funding for the Bass Museum, the Colony Theater, and the Byron Carlyle Theater, which all contribute to the City's cultural landscape: $726,000 (Resort Tax) Adjustments Subsequent to Budget Briefings Over the summer recess, the Administration further refined the Proposed FY 2018/19 Budget based on recommendations from the Budget Briefings, updated FY 2017/18 third quarter projections, and refinements to the cost of recommended enhancements. These adjustments resulted in an increase of$527,000 in revenues and a decrease of$527,000 in expenditures as outlined below. Page 59 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 3 Balancing Strategies 20-Jul 12-Sep Change July 1 Preliminary Deficit (4,553,000) (4,553,000) - Recommended Reductions 1,716,000 1,875,000 159,000 Recommended Revenue Enhancements 1,094,000 1,135,000 41,000 Recommended Enhancements (1,981,000) (2,957,000) (976,000) Revenue Refinements 1,485,000 1,971,000 486,000 Transfer in from Parking 1,166,000 1,166,000 - Other Expenditure Refinements - 290,000 290,000 Less One-time Expenditures 1,073,000 1,073,000 - Surplus/(Deficit) - - - Expenditure Reductions: $159,000 • Elimination of security posts at City Hall - first floor and roving guard based on the recommendation of the Police Chief: $159,000 Revenue Enhancements: $41,000 • Increase in Parks and Recreation Non-Resident Fees: $41,000 Expenditure Enhancements: ($976,000) • Park Ranger enhancements approved at the July 20'h meeting (original $422,000 cost estimate reduced by the Parks & Recreation department): $250,000 • Increase in the City's funding in the management agreements for the Bass Museum, the Colony Theater, and the Byron Carlyle Theater: $726,000 Revenue Refinements: $486,000 • Increase in revenues transferred to the General Fund from the Resort Tax Fund to cover the increase in the City's funding for the Bass Museum,the Colony Theater, and the Byron Carlyle Theater: $726,000 • Increase in Administrative Fees to the General Fund from other Funds: $100,000 • Decrease in Transfer from Resort Tax to the General Fund based on availability of Resort Tax funds: $340,000 Expenditure Refinements: $290,000 • Decrease in Risk Management charge to the General Fund based on FY 2017/18 third quarter actuarial projections: $392,000 • Increase in Internal Service Allocation to the General Fund based on the finalized proposed budget: $102,000 Adjustments Subsequent to First Public Hearing As part of the Administration's continuing effort to identify efficiencies and/or reductions in the City's annual budget, during the 15' Public Hearing on September 12, 2018, the Administration presented additional General Fund reductions totaling$283,000 to the City Commission, as noted below. Page 60 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 4 Expenditure Reductions: $283,000 • Eliminate 1 additional Full-Time and 3 additional Part-Time vacant General Fund positions: $101,000 • Reorganize the Department of Emergency Management, including elimination of the Emergency Management Director position: $182,000 The City Commission accepted these reductions, which resulted in a decrease of $283,000 in expenditures, and an increase in the budgeted operating contingency as noted below. Balancing Strategies 12-Sep 26-Sep Change July 1 Preliminary Gap (4,553,000) (4,553,000) - Recommended Reductions 1,875,000 2,158,000 283,000 Recommended Revenue Enhancements 1,135,000 1,135,000 - Recommended Enhancements (2,957,000) (2,957,000) - Revenue Refinements 1,971,000 1,971,000 - Transfer in from Parking 1,166,000 1,166,000 - Other Expenditure Refinements 290,000 7,000 (283,000) Less One-time Expenditures 1,073,000 1,073,000 - Surplus/ (Gap) - - - FY 2018119 General Fund Budget Based on the direction given at the various Budget Briefings during the summer, budget adjustments made over the summer recess, and direction given during the 1" Public Hearing on September 12, 2018, the Administration proposes the FY 2018/19 General Fund budget as noted below, which, if approved, would result in a balanced budget. September 26, 2018 Budget $ Revenues 345,145,000 Expenditures (345,145,000) Surplus/ (Gap) - Page 61 of 366 Adopt Final Budgets for FY 2018/19 September26, 2018 Page 5 The charts below reflect the major revenue and expenditure categories of the FY 2018/19 General Fund budget. FY 2018/19 GENERAL FUND REVENUES Miscellaneous 4% Non Operating Other Revenue Revenues Charges for Services 4% 3% incl.Golf Courses) Property Tax Intergovernmental 53% 4% Other Taxes ]% Licenses and ..- Permits eke RDA Contribution 1% Parking Contribution 0% Resort Tax Contribution 11% FY 2018/19 GENERAL FUND EXPENDITURES Other 22% Police 33% Public Works yvA PR h" 43e1,141ec `F Parks&Recreation including Golf Xses) 11% Emergency Management Fire 1% 25% Page 62 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 6 Recommended Expenditure Reductions/Efficiencies —Attachment A ($2,158,000) Attachment A includes a listing of all recommended reductions/efficiencies, and provides detailed descriptions of recommendations as noted below: • Eliminate 6 full-time and 7 part-time vacant General Fund positions: $570,000 • Eliminate the Rapid Response Team: $147,000 (2 filled positions) • Reduce General Fund contingency: $332,000 • Eliminate one Assistant City Manager position once vacated: $75,000 (pro-rated) • Eliminate annual grant contribution to the Miami Design Preservation League per direction from the Finance and Citywide Projects Committee: $23,000 • Other departmental operating reductions/efficiencies: $660,000 • Transfer of contribution to Miami Beach Gay Pride Parade to Resort Tax Fund: $10,000 • Eliminate first floor and roving guard security posts at City Hall based on the recommendation of the Police Chief: $159,000 • Reorganize the Department of Emergency Management, including elimination of the Emergency Management Director position: $182,000 Recommended Revenue Enhancements —Attachment B ($1,135,000) Attachment B includes a listing of all recommended revenue enhancements, and provides detailed descriptions of recommendations as noted below: • ncrease in Golf Fees: $265,000 • ncrease in Police Off-Duty Administrative Fees: $164,000 • ncrease in Elevator Permit/Inspection Fees: $236,000 • ncrease in Public Works Elevator Lockbox Fees: $11,000 • ncrease in Sidewalk Café Permit Fees: $358,000 • ncrease in Food Truck Revenues (Pilot program for 1 truck for 6 months): $60,000 • ncrease in Parks and Recreation Programming and Rental Fees for Non-Residents: $41,000 Recommended Expenditure Enhancements —Attachments C 8 D (-$2,957,000) Attachments C and D include a listing of recommended enhancements and one companion revenue reduction, and provide detailed descriptions of recommendations as noted below: • Police Officers in Schools: $871,000 This enhancement will add (1) Sergeant and (6) Police Officers to increase public safety in schools. The first-year cost of adding 1 Sergeant and 6 Police Officers to be assigned to the schools is$1,063,000,which will be offset by the elimination of(5)Part Time School Liaison Officer positions in the amount of$192,000, resulting in a net impact of$871,000 in year 1, including one-time costs for equipment needed (vehicles, radios, etc.). • Park Rangers Program Expansion: $250,000 This enhancement provides for four additional part-time Park Ranger positions to enhance coverage of the Beachwalk between South Point Park and 46th Street, including South Pointe Park and Collins Park, to 24 hours Wed-Sat, and 7am-11pm Sun-Tues (2 Park Page 63 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 7 Rangers/shift). It would also provide for one part-time Park Ranger position to be dedicated to the Barry Kutun Boat Ramp located in Maurice Gibb Park and would provide coverage 4 days/week, during high demand periods, Thurs: 12pm-5pm, Fri-Sun: 12pm- 8pm (1 Park Ranger/shift). • Living Wage Increase (General Fund): $89,000 Based on the Finance and Citywide Projects Committee's recommendation, approved by City Commission through Resolution No. 2018-30299 on May 16, 2018, this living wage enhancement would fund the previously approved phase-in approach of increasing the minimum living wage rate by $0.56 per hour for FY 2019. The overall citywide impact of the proposed living wage increase for FY 2019 is projected to be $504,000, of which $89,000 is projected to impact the General Fund. • Part-Time Education Compact Initiatives Coordinator position: $45,000 With the increase in the education initiatives and number of initiatives supported by the City, the Department of Organizational Development and Performance Initiatives (ODPI) requires an individual to support Education Compact initiatives and other Commission priorities related to education. In addition, this part-time position will identify opportunities and gaps in services and programs which will prepare children and youths for their futures. • Convert Part-time School Liaison Supervisor to Full-time $34,000 The current role of a School Liaison Supervisor (SLS) is to oversee the School Liaison Officers (SLO) and School Crossing Guards (SCG). During the regular school year, this employee is required to be available to all part-time employees throughout the various shifts. Supervision and evaluation of crossing guards is necessary at 6 schools in the City during early morning and afternoon hours, five days per week. If approved, this position will be assigned additional duties in support of the School Officer Program. • Homeless Relocation Services: $10,000 With this increase in relocation funds, the Homeless Outreach Program will be able to reconnect up to an estimated 250 homeless clients with family living outside of Miami- Dade, Broward, Monroe, and Palm Beach County per a motion approved by the Committee on the Homeless. • The Cat Network Program: $10,000 The Cat Network Program is a spay/neuter program for surgeries,vaccines,and wellness. This enhancement is to provide funding outside of the grant contribution for the trailer, septic tank, marketing, feeders, badges, and other operating expenditures needed for the program to be successful. • Colony Theater: $330,000— Resort Tax The City's current agreement with Miami New Drama for management of the Colony Theater is presently $170,000. Miami New Drama is a relatively new operator in Miami Beach, and has experienced tremendous artistic growth over the past two years, while contributing to the overall cultural landscape of our City. This enhancement increases the City's management agreement with Miami New Drama to $500,000 and would be funded through an additional transfer from the Resort Tax Fund to the General Fund in FY 2018/19. Page 64 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 8 • Bass Museum: $234,000 - Resort Tax The City's current management agreement with the Friends of the Bass Museum is $651,000. This enhancement increases the City's management agreement to $885,000. The management company has spent many months working with City staff to provide full accounting and transparency regarding its earned and contributed income goals both this year and long-term, within the requested methodology to analyze the City's funding as it relates to the 2010 agreement to assume responsibility for the collection and its display. Pursuant to this agreement, it stands to reason that the City's annual contribution would go up in line with the annual Consumer Price Index (CPI). This has not happened over the past eight years; therefore, this enhancement would assume the full funding request in FY 2018/19, in order to be current, fiscally responsible, especially in light of the newly renovated facility and greatly enhanced exhibiting parameters. This enhancement would be funded through an additional transfer from the Resort Tax Fund to the General Fund in FY 2018/19. • Byron Carlyle Theater: $162,000- Resort Tax As part of a comprehensive strategy to incentivize local film in Miami Beach, the City of Miami Beach currently has an agreement with O'Cinema to operate the Byron-Carlyle Theater. As part of the City's current support, O'Cinema Management is seeking additional support of $150,000 via this enhancement request for ongoing maintenance and repairs, as well as an annual subsidy to support and expand current programming in the theater. The current management agreement also stipulates that O'Cinema pay the City an annual minimum guarantee, as well as reimburse the City for 72% of the utility costs for the theater. This enhancement also requests, as a companion revenue reduction request(as noted in Attachment D),that the annual minimum guarantee and proportionate reimbursement to the City of 72% of the theater's utility costs be reduced (submitted as a $12,000 revenue reduction request). The overall impact of this request is $162,000. This enhancement would be funded through an additional transfer from the Resort Tax Fund to the General Fund in FY 2018/19. Other Revenue Refinements ($1,971,000) In addition to the recommended revenue enhancements listed above for FY 2018/19, the Administration refined the FY 2018/19 revenue projections throughout the budget process as more current year data became available. These adjustments resulted in an increase of approximately $1,971,000 in FY 2018/19 projected revenues, primarily due to the following: • Increase in Resort Tax transfer to the General Fund: $160,000 • Increase in projected Interest Income: $500,000 • Increase in Code Compliance Violation revenues: $250,000 • Increase in Fire-Ambulance Fees: $250,000 • Increase in revenues transferred to the General Fund from the Resort Tax Fund to cover the increase in the City's funding for the Bass Museum,the Colony Theater, and the Byron Carlyle Theater: $726,000 • Increase in Administrative Fees to the General Fund from other funds: $100,000 • Decrease in other miscellaneous revenues: $15,000 Page 65 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 9 Parking Fund Transfer to the General Fund ($1,166,000) In order reduce the burden on the Parking Fund, the Administration's goal was to reduce the$4.4 million subsidy from the Parking Fund to the General Fund during the FY 2018/19 budget development process. Based on direction given at the July 2091 Budget Briefing, the FY 2018/19 transfer from the Parking Fund to the General Fund decreased from $4.4 million to $1,166,000 and was offset by a transfer of funds released from the City Center Redevelopment Agency (RDA) Fund in the amount of $4.4 million in FY 2018/19. These RDA funds became available through approval of the Fourth Amendment to the Interlocal Agreement between the City and Miami Dade County. The City's objective is to reduce the General Fund's reliance on this funding from the RDA over the next four years during each budget development cycle. Historical Parking Transfer to General Fund 9,000,000 8,000,000 7,000,000 6,000,006 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 One-Time Expenditures ($1,073,000) Pursuant to Resolution No. 2006-26341, the City can use one-time, non-recurring revenue for capital expenditures or one-time expenditures and not to subsidize recurring personnel, operational and maintenance costs. In an effort to further make investments toward creating additional capacity and increasing efficiency in the future, the Administration is recommending funding the FY 2018/19 enhancements below, which are considered one-time in nature, utilizing fund balance in accordance with Resolution No. 2006-26341: • First-Year Funding Bridge for Office of the Inspector General: $484,000 The pro-rated cost of the Office of the Inspector General, if approved by the voters on November 6, 2018, is projected to be $484,000 in its first year of operation (FY 2018/19). The intention is to fully fund this new office from a surcharge on City contracts, similar to Page 66 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 10 Miami Dade County's surcharge. It is important to note that surcharge revenues, if approved by the City Commission, would apply to new contracts as they are re-awarded. As a result, the full $1.0 million in revenues needed to fund the projected year-two costs, which are annualized, would not be realized until FY 2023. Funding the first-year cost as a one-time expenditure from fund balance would be the first step in the funding bridge. • Sunset Islands 3 & 4 Undergroundinq Project Debt Service: $212,000 To advance fund the Sunset Islands 3 &4 Utility Improvement, as adopted by Resolution 2015-29180,$1.5 million was borrowed from the General Fund as approved by Resolution No. 2016-29273. There is currently no 3rd party outstanding debt. Once the project is completed, the City will enter into a bank loan in order to reimburse itself from the proceeds of such loan for funds advanced by the General Fund. Pursuant to Resolution 2015-29180, Section 8, the City will start billing a Special Assessment once the Mayor and Commission adopt a Resolution accepting the improvements as completed. Shortly thereafter, the City will commence billing and collections of the Assessment. Assessment receipts will be used to pay the loan. The $212,000 is budgeted in anticipation of project completion in FY 2019, which could result in a debt service payment before the Assessments are collected. • Business Tax Receipt (BTR) Process Improvements: $200,000 A subject matter expert would be retained to assess the City's Business Tax Receipt process and provide recommendations for improvement, which would be geared toward streamlining the BTR processes and increasing efficiency. • Camillus House Pilot Project: $92,000 This organization proposes conducting targeted street outreach to chronically homeless persons with mental illnesses to provide medication and engagement to enable shelter and housing placement for those served. This request was recommended by the Committee for Quality Education and received a favorable recommendation for funding from the Neighborhood and Community Affairs and Finance and Citywide Projects Committees. • Washington Avenue Master Plan: $50,000 The Washington Avenue Master Plan would be developed to focus on improvements to increase vibrancy, lighting, and gathering points along the Washington Avenue corridor for both residents and visitors. • Employee Innovation Academy: $35,000 Employees at all levels would be educated on principles geared toward the elimination of waste, increased efficiency, improving processes, and ultimately creating a higher standard of government. Use of Resort Taxes to offset Tourism Eligible Expenditures in the General Fund Based on an outside consultant study conducted in 2016 using actual expenses for FY 2013/14, the study estimated that there are approximately $55 million in eligible Resort Tax expenditures in the General Fund. Page 67 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 11 These include expenditures associated with police officers serving entertainment areas; a portion of fire rescue services from Fire Stations 1 & 2; ocean rescue services; enhanced code compliance provided to respond to evening entertainment area violations and staffing of special events; other code compliance activities in tourism and visitor related facilities/areas;Tourism and Culture Department and the Cultural Arts Council; museums and theaters (Garden Center, Bass Museum, and Colony Theater); golf courses (net of revenues); Memorial Day and other special event costs; homeless services; July 4'"; Visitor Center funding; holiday lights; Jewish Museum; Miami Design Preservation League (MDPL); Orange Bowl; monuments; etc. The total Resort Tax Fund transfer to the General Fund for FY 2018/19 is $35.8 million, which is a $886,000 (2.5%) increase over the FY 2017/18 transfer of $34.9 million. The FY 2018/19 transfer includes $726,000 in increased funding for the Bass Museum, the Colony Theater, and the Byron Carlyle Theater, which all contribute to the City's cultural landscape. BUDGET AND POSITION TRENDS The 2016 Environmental Scan conducted as part of the strategic planning process showed that the average daily population in the city has grown 27.2 percent from 2007 to 2016. Much of this increase consists of additional other tourists (77 percent), seasonal residents (53 percent), hotel guests (40 percent), and non-tourist beach visitors (40 percent). Having over 27 percent more people in the City over the last ten years, without an offsetting increase in budget can result in services becoming degraded over time. The chart below shows the General Fund budget and General Obligation Bond Debt Service budget divided by the average daily population from FY 2007 to FY 2016. The chart shows that the average daily population has grown faster than the budget and that the FY 2016 amount is 1.4 percent below the FY 2007 amount. General Fund and G.O. Debt by Average Daily Population FY 2006/07— FY 2015/16 too __ . . . . _.. . i 3.200 • • • SOO 600 3006-07 2007408 I1,01109 203410 30300 - 2.33 IOl3 as xouJS 2015.16 Despite the 27 percent growth in average daily population and tourism, the City's position count has remained relatively flat over time as shown in the chart below. The overall position count in FY 2018/19 is 1 position more than last year and 30 positions, or 1.4%, more than in FY 2006/07. Page 68 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 12 Position Count FY 2006107 - FY 2018/19 2.303. 1.� • _ • •yp • • • • • • • 7th • ■ • • • • • • • • • • Lbw 111 111 • • • • 143 • • • •• • • • U • • 1200 • . • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 900 • • • • • • • • • • • • 7ne • • • • • • • • • • • • �n • • • • • • • • • • • • 1111111 • • • • . • • • • • • • 100 • • • • • • • • • • • • 1ne • • • • • • • • 111 • • • FY07 FY08 FYW FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 •Other Fund% 618 609 608 582 521 574 566 571 585 6W 624 620 620 •General Fund 1,509 1,441 1,399 1345 1,313 1,312 1.337 1371 1,442 1,469 1,536 1,536 1,537 •General Pond a other Funds FY 2018/19 ENTERPRISE FUND BUDGETS Enterprise Funds are comprised of Sanitation, Water and Sewer, Storm Water, Parking, and Convention Center Departments. The FY 2018/19 Enterprise Funds Budget is $210.0 million. This represents an increase of$1.0 million, or 0.5%,over the FY 2017/18 budget of$209.0 million, primarily due to the following: • Water reflects an overall decrease of$3.8 million, or 9.8%, primarily due to a decrease of $4.8 million in debt service expenditures based on the current debt schedule for ongoing infrastructure projects allocated to water utilities improvements. This reduction was offset by increases in personnel, operating, and capital expenditures. • Sewer reflects an overall increase of$1.0 million, or 2.0%, primarily due to an increase of $2.0 million in debt service expenditures based on the current debt schedule for ongoing infrastructure projects allocated to sewer utilities improvements. This increase was offset by decreases in personnel and capital expenditures. • Parking reflects an overall decrease of$5.1 million, or 8.7%, primarily due to a$3.2 million and $3.1 million reduction in the amount of Parking funds transferred to the General and Page 69 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 13 Transportation Funds respectively. During the development of the FY 2018/19 budget, one major priority was to reduce the burden on the Parking Fund by reducing these transfers. The goal is to continue to reduce these transfers over the coming years, allowing for the Parking Fund to restore its fund balance set aside for future renewal and replacement projects. The reduction in transfers were offset by increased personnel,other operating, and debt service expenditures. • Storm Water reflects an overall increase of $1.1 million, or 3.8%, primarily due to an increase of $1.4 million in the amount budgeted to be set aside for future renewal and replacement of storm water capital assets, offset by reductions in personnel and debt service expenditures. • Sanitation reflects an overall increase of $1.2 million, or 5.5%, due to an increase of $738,000 (5.8%) in personnel expenditures (primarily due to merit increases and increases in health insurance costs), and an increase of $322,000 in operating costs, primarily due to an increase in the budgeted cost of janitorial services and residential solid waste disposal. • Convention Center reflects an overall increase of $6.7 million, or 52.7%, due to the anticipated re-opening of the facility. The prior year budget was artificially low due to the Convention Center being closed for the majority of the fiscal year. With the renovation and expansion of the Convention Center, the budget reflects a $6.1 million increase in the contractor's cost, including a $3.0 million increase in personnel expenditures, and a $3.3 million increase in operating expenditures. The City's budgeted expenditures increased by $544,000, primarily due to enhancements which include a one-time $250,000 enhancement for the Convention Center Community Grand Opening & Gala, a $360,000 enhancement for the Convention Center Transportation Enhancement Package, and a one-time$200,000 enhancement for the City of Miami Beach Hall of Fame Digital Display. These enhancements were primarily offset by reductions in the City's personnel and other operating expenditures. The FY 2018/19 Convention Center budget requires the use of $2.5 million of available fund balance in order to be balanced. With the newly-renovated and expanded Miami Beach Convention Center set to officially re-open in the Fall of 2018, the five-year forecast projects that the Fund will be balanced commencing FY 2019/20. Parking Rate Increases In order to ensure adequate funding for future capital projects and renewal and replacement of existing Parking Department assets, the following parking rate increases were approved by the Committee at the FY 2018/19 Budget Briefings: • Daily Space Rental Construction: $224,000 This proposed modification would increase the construction daily space rental fee from $25/day to $35/day. • Entertainment District Meter Hours (Ocean Drive to Washington Avenue and 5th to 15th Street): $135,000 Currently, metered parking rates within the corridor of Ocean Drive to Washington Avenue and 5th to 15th Street are enforced from 9 am to 3 am.This proposed enhancement would increase the hours that these spaces are metered to 24 hours/day. Page 70 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 14 • 46th Street & Collins Avenue Parking Lot (P71): $539,000 Currently, metered parking at the 46th Street & Collins Avenue Municipal Parking Lot (P71), Monday to Friday, from 8am to 6pm, is $1/hour, while weekends is a flat rate of $20 for visitors and$6 for residents.This proposed enhancement would change the hourly rate to a flat rate of$20 for visitors and $6 for residents, 24 hours/day. This enhancement, if approved, would also generate an additional $149,000 in expenditure savings from a reduction in meter attendant services since revenue collections will be 100% automated. • Hostel/Bed & Breakfast Residential Zones: $30,000 Currently, the annual residential parking permit rate is $54.60. This proposed enhancement would replace the annual residential parking permit rate in the Hostel/Bed and Breakfast Residential Zones with the daily parking permit rate of$3.00/day. Sanitation Fund Rate Increases At the July 27, 2018 Budget Briefing, the Administration advised the Committee that the FY 2018/19 Sanitation budget reflected a projected shortfall, even after accounting for the $941,000 increase in funding from the Resort Tax Fund as previously noted. This shortfall is primarily a result of increasing expenditures, which were not offset by rate increases during the economic downturn, as well as the Resort Tax Fund's inability to transfer$1.9 million to the Sanitation Fund, over and above the $1.8 million transfer included in the FY 2018/19 budget. In order to reduce the shortfall, the Administration proposed a combination of Sanitation rate increases. The Committee approved the following adjustments: • Residential Fees A$3.62 per month increase in Sanitation Residential Fees,which is a pass through of the recycling fees charged to the City by Miami Dade County. The City has been absorbing this cost since 2008. • Franchise Fees (Commercial) A 2% increase in commercial franchise fees from 18%to 20%.This fee was last increased in 2007 and affects solid waste franchisees that provide service to commercial accounts and multi-family units. • Roll-Off Permit Fees A 2% increase in commercial franchise fees from 18% to 20%. This fee has not been increased in 10 years and affects solid waste licensees that provide roll-off service to commercial and residential units. After incorporating the rate increases noted above, the FY 2018/19 Sanitation Fund budget will need to use $2.5 million in available fund balance to balance the budget. It is important to note that$1.7 million of Sanitation Fund emergency reserves were expended in FY 2016/17 as a result of Hurricane Irma. It is anticipated that a percentage of these expenditures will be reimbursed by the Federal Emergency Management Agency(FEMA). At the September 12, 2018 1st Public Hearing, the City Commission approved the Sanitation rate increases approved by the Committee at the July 27, 2018 Budget Briefing, with the exception of the pass through of the recycling fee portion of the Residential Fees assessed by Miami-Dade County. Page 71 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 15 FY 2018/19 INTERNAL SERVICE FUND BUDGETS Internal Service Funds are comprised of Central Services, Fleet Management, Information Technology, Risk Management, Medical and Dental, and Property Management. The FY 2018/19 budgets for Internal Service Funds is $96.3 million, or 12.0%, more than FY 2017/18. The 12.0% increase primarily resulted from a 19.0% increase in the Medical Fund budget, which is reflective of increasing health insurance costs due to a high claims experience during FY 2017/18. A portion of the increased cost has been passed on to employees through increased FY 2018/19 premiums. The FY 2018/19 Medical and Dental budget requires the use of $1.9 million of available fund balance to be balanced. The Administration will continue to monitor the experience within the Fund and adjust benefits and premiums as appropriate. Another driver of the FY 2018/19 budget increases is a significant increase in the Fleet Management budget. As noted at the May 24th Budget Workshop, due to fiscal constraints, the City has been delaying some vehicle and equipment replacements, and funding purchases with equipment loans versus cash. The FY 2018/19 budget includes a $1.3 million increase in debt service expenditures towards the purchase of vehicles and equipment purchased in previous years, as well as those projected to be purchased in FY 2018/19. In the short-term, the Administration has proposed allocating approximately $12.0 million of funds from the fourth RDA amendment over the next four years towards reducing the debt, and the replacement of the City's fleet using cash in lieu of financing. The City has also engaged the services of a consultant, who is assessing Fleet Management's inventory and will present recommendations on right-sizing opportunities. Internal Service costs are completely allocated to the General Fund and Enterprise Fund departments, as well as Special Revenue Funds. The Risk Management Fund, however, reimburses the General Fund for the cost of legal services provided. Use of One-Time Revenues for Recurring Expenditures As previously noted, the City's policy regarding use of one-time revenues states that "the City of Miami Beach will use one-time, non-recurring revenue for capital expenditures or one-time expenditures and not subsidize recurring personnel, operations, and maintenance cost." The Sanitation, Medical and Dental, and the Convention Center Funds each require the use of fund balance for recurring FY 2018/19 operating expenditures. As a result, it is recommended that the City Commission waive this policy, as adopted by Resolution No. 2006-26341, providing for the one-time use of fund balance for the Sanitation, Medical and Dental, and Convention Center Funds. During the upcoming fiscal year, the Administration will recommend a plan of action to ensure that these funds will move toward being structurally balanced. FY 2018/19 RESORT TAX FUND BUDGET The FY 2018/19 Resort Tax budget is $89.4 million, which is an increase of $6.2 million or 7 percent from FY 2017/18. This increase reflects the increase in Resort Tax revenues during the current fiscal year. The Administration will continue to monitor these revenues over the upcoming months. The FY 2018/19 Resort Tax budget includes: Page 72 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 16 • $35,836,000 provided to the General Fund. This reflects an increase of$886,000 (2.5%) over the FY 2017/18 transfer of$34.9 million. These funds are used to support continuing tourism eligible expenditures such as code enforcement, cleanliness, the Park Ranger program, homelessness at Lummus Park, increased support for the Miami Beach Botanical Gardens and the City's cultural facilities, public safety programs such as ocean rescue, police services on Lincoln Road, Ocean Drive/Lummus Park, Collins Avenue, Washington Avenue, ATV officers, boardwalk security, special traffic enforcement and staffing during high impact periods. Funding also supports code compliance enforcement in the entertainment areas and a portion of the operational costs of the Department of Tourism, Culture and Economic Development, including an increase of $726,000 transferred to the General Fund to increase the City's management agreements with the Friends of the Bass Museum ($234,000), the Miami New Drama ($330,000), and O'Cinema ($162,000). • $3,456,000 million for enhancing City services, inclusive of Goodwill Ambassadors, during high Impact event periods such as Memorial Day, July 41b, Spring Break, and Art Basel. This reflects an increase of$851,000 over FY 2017/18 funding which is comprised of an additional $700,000 in funding for police overtime, and $151,000 for the City's share of the Ocean Drive Tourist Oriented Policing Off-Duty Services pilot program. • $2,862,000 million contribution to the Miami Beach Visitor and Convention Authority(VCA) based on the legislated funding formula. • $200,000 to continue the local Miami Beach marketing campaign, which is matched with funds from the Greater Miami Convention and Visitors Bureau(GMCVB),the Miami Beach Visitor and Convention Authority (VCA), and the Cultural Arts Council (CAC). • $535,000 for enhanced holiday decorations throughout the City's tourism areas. • $450,000 contribution to partially offset expenditures for the Miami Beach Air and Sea Show ($350,000)and International Tennis Federation Tennis Event ($100,000). • $100,000 for Memorial Day weekend cultural activation events. • $73,000 contribution for the Miami Beach Gay Pride Parade event. This contribution was previously funded at $10,000 by the General Fund. During the Budget Briefings, the Committee recommended increasing funding and transferring the expenditure to the Resort Tax fund. • $81,000 allocated for professional services to fund special events marketing sponsorships, annual audit services, and consulting fees. • $1,000,000 for year five of a fifteen-year annual contribution of $1 million to Mount Sinai Medical Center to fund the design and construction of a new emergency room facility. • $6,651,000 contribution to the Greater Miami Convention and Visitors Bureau (GMCVB) based on a new performance-based contract executed January 2016. Page 73 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 17 • $1,812,000 contribution to Sanitation for services provided throughout the entertainment district. This represents a $941,000 increase over last year. As noted at the Budget Briefings, the Resort Tax Fund was unable to fund $2.8 million of payments due to the Sanitation Fund for services provided in FY 2017/18. This is the first step toward increasing funding toward the Sanitation Fund. • $542,000 to support the initiative to provide better service by adding attendants to the beachfront restrooms in Lummus Park and 21st street on weekends, holidays, and during high impact periods. • $500,000 in contingency to fund one-time unforeseen expenditures and $274,000 for unforeseen expenditures that may occur during high-impact event periods.This combined total represents a $524,000 increase over the contingency budgeted in FY 2017/18. • $14,421,000 for North, Middle, and South Beach Quality of Life (QOL) Capital Projects that enhance Miami Beach's tourist related areas, plus continued support of transportation initiatives and various arts and cultural programs. Commencing in FY 2018/19, the allocation of the 1% QOL bed tax is proposed to reflect the following contributions: Transportation 60%, North Beach QOL 10%, Middle Beach QOL 10%, South Beach QOL 10%, and Arts 10%. • $14,421,000 for debt service associated with the Resort Tax revenue bonds issued in 2015 for the expansion and renovation of the Miami Beach Convention Center. 1% Resort Tax Fund Quality-of-Life Funding Allocations The current 1% Quality of Life bed tax, as adopted by Resolution No. 2015-28919, is approved to be used as follows: 45% allocated for Transportation initiatives in tourist-related areas; 15% allocated equally among North Beach, Middle Beach and South Beach for capital projects that enhance Miami Beach's tourist related areas; and 10% allocated to various arts and cultural programs. As approved by the Committee at the July 13, 2018 Budget Briefing, commencing FY 2018/19, this would be amended to increase the allocation for Transportation initiatives from 45% to 60% and decrease North Beach, Middle Beach, and South Beach capital from 15% to 10% each, which would reduce the Parking Fund's subsidy to the Transportation Fund. Based on revenues collected as of June 2018,the projected FY 2018/19 1%Resort Tax contribution for transportation initiatives would increase by approximately by $2.2 million thereby reducing the Parking Fund subsidy to the Transportation Fund by the same amount. FY19PROJECTED(CURRENT) FY 19 PROJECTED(PROPOSED) Prop vs Curr. 1%Quality of life(QOL)Revenue Allocation 1%Quality of Ufe(QOt)Revenue Allocation I%Allocation Transportation 45% 6,400,000 Transportation 60% 8,653,000 2163,000 NB-OOl 15% 2,163,003 NB 001. 10% 1,442,000 (721000) MB-0O1 15% 2,163,000 MB-QOL 10% 1,442,000 (721000) 511-OOL 15% 2,163,000 SB-001 10% 1,442,000 (721000) Arts 10% 1442,000 Arts 10% 1,442,000 0 Total 100% 14,421,000 Taal 100% 14,421,000 0 Page 74 of 366 Adopt Final Budgets for FY 2018/19 September 26, 2018 Page 18 CONCLUSION In summary, the millage rate of 5.8888 mills remains the same as last year and is the lowest millage rate in the history of the City of Miami Beach. The FY 2018/19 budget includes service level enhancements that address high priority needs of the City as identified through the Commission Budget Retreat, four Budget Briefings, and 15' Public Hearing on September 12, 2018. The Administration recommends adoption of the attached Resolution which establishes the final budgets for General, G.O. Debt Service, RDA Ad Valorem Taxes, Enterprise, Internal Service, and Special Revenue Funds for FY 2018/19. Attachment A— FY 2018/19 Recommended Expenditure Reductions/Efficiencies Attachment B— FY 2018/19 Recommended Revenue Enhancements Attachment C— FY 2018/19 Recommended Expenditure Enhancements Attachment D— FY 2018/19 Recommended Revenue Reductions JLM/JW/TOS Page 75 of 366 Do o . ?\7 \ \\ } \ ) \ \ \\ r2 a/ \ \\ \\\\ \ \� \ \ o o \ \ \ \ \ \ \ } \-0-COD o 0o _c \\\ \\\\ co\\\ In MI \ E OT\ \ } } j clz ) k 2 § § }_ CN ` \ Id g} 0 \ 0 0 0 § CI CD ! ¢ \ co /. \/ \ \ \ ` in N 4. es . § . ( . \ : ~ ! / } } } } ) } co r= » : \\ \ \ \\ T \Z o, Em - = 3 - L. E E f o0E2' 7, - 0 - E▪ 0 - - m m o a . E am m c s U a) s a E w V p - >, 3- 2. 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