1. City of South Burlington Steering Committee FY12 Budget Review Sandy Miller, City Manager Bob Rusten, Assistant City Manager January 25, 2011

2. Key Cost Indicators Reduction of 9.7 FTEs Total Wages, all funds, are down $68,763, from $7,956,178 in FY11 to $7,899,415, which reflects $50k in additional costs due to SAFER, and $238,000 in wage adjustments for a total savings of $358,000 over what our wages would have been without staffing reductions. Total Health Insurance Costs are down 22%, from $1,377,418 (not counting the 1/1/11 increase of 7.5%), to $1,075,620, a reduction of $301,798. Factoring in the 7.5%, our savings are over $400,000. Total Pension Plan Costs increased $207,363, or 14.53%, from $1,427,487 in FY11 to $1,634,850 FY12 (including savings due to some switches to VMERS). Comparing FY12 budget figures to what was actually spent in FY10, the figure is an increase of $373,000.

3. Further Cost Saving Ideas Continue to try to move staff from SB’s pension plan to VMERS Re-bidding health insurance again in 2011. Possible financing pension liability. Bidding various municipal services. Looking for additional revenues and cost savings. Asking employees and bargaining units for their suggestions.

4. Other Issues to Note Restructure Airport Parkway wastewater expansion project by financing additional $2.5 million – voter approval needed. Restructuring internal financial operation and management. Audit report due in March. Projected fee increases for planning, highway and ambulance are being used to lessen the property tax increase. General Fund, Water, Stormwater and Water Pollution Control budgets for FY12 expected to be on a balanced or surplus basis.

5. Estimated City Taxes and Utilities Based on City Council FY 12 Budgets City Tax rate estimated as 2.25 cent increase, from $0.3622 to $0.3847 For condo at $208,000 = $46.82 annually For primary residence at $316,000 = $71.10 annually Per $100,00 assessed valuation = $22.50 annually Water proposed increase = $22.15 annually Stormwater proposed increase = $17.28 annually Wastewater proposed increase = $78.18 annually Total Estimated City Tax and Utility Increase Condo, $208,000 = $164.43 annually, $13.70 monthly. Primary Residence, $316,000 =188.71, $15.73 monthly.

6. Summary of Estimated City and School Taxes and Utilities for FY12 With School Residential Tax Rate estimated to decrease from $1.383 to $1.373 or one cent, the combined rate is estimated to increase 1.25 cents. As a percentage of the FY11 combined Residential Tax Rate of $1.7452, the FY12 increase would be 0.72%, to $1.7577. Total Estimated Increase to SB Residents (City tax increase, less School tax decrease plus utilities increase) Condo @ $208,000 = $143.61 annually or $11.97per month Primary residence @ $316,000 = $157.11 annually or $13.09 per month