HomeMy WebLinkAbout2009-05-27 09-180 ORDERCOUNCIL ACTION
Item No. 09 I S 0
Date: 05-27-2009
Item/Subject: Order, Authorizing the Transfer of Unexpended Energy Appropriations within
the General Fund to Partially Fund the Costs Associated with the City's Energy
Conservation Projects
Responsible Department: Finance
Commentary: The City, through an energy performance contract with Honeywell, has
implemented a wide variety of energy saving measures in its various facilities with the intent of
reducing both our environmental footprint and operating costs. Within the General Fund, $1.2
million in projects have been completed and will be paid for through a lease/purchase
arrangement previously approved by the Council.
The City's FY09 budget was significantly impacted by the high energy costs in place at the time it
was adopted. Since then, a combination of the energy conservation steps that have been taken
and a dramatic decline in energy prices has produced significant savings over the amounts
budgeted this year.
In order to speed the positive operating impact of these energy conservation project on future
years' budgets, it has been suggested that this budget year's savings be used to lower the $1.2
million the City will be financing for our general fund projects. This order will do so by
transferring energy savings from the various departments, subject to two restrictions. First, the
amount transferred from any individual department may not be any larger than the amount by
which that department finishes the year below its total expenditure budget. Second, the total
amount to be transferred within the general fund will be reduced by the amount, if any, that
total General Fund revenues fall short of budget. This will ensure that the transfer of these
funds will not result in any department over expending its budget and that any General Fund
revenue shortfall will also be recognized.
Department Head
Manager's Comments: >
City Manager
Associated Information:
Budget Approval:
Finance Director
Legal Approval:
City Solicitor
Introduced for
X Passage
First Reading
Page _ of _
Referral
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Assigned to Councilor Nealley May 27, 2009
CITY OF BANGOR
(TITLE.) Order, Authorizing the Transfer of Unexpended Energy Appropriations within the
General Fund to Partially Fund the Costs Associated with the City's Energy
Conservation Projects
WHEREAS, as part of the Fiscal Year 2009 budget, the City Council voted to increase the tax
levy above the property tax levy limit, as calculated under 30-A MRSA Section 5721-
A, due to an unprecedented increase in fuel prices; and
WHEREAS, during Fiscal Year 2009, the City completed a number of energy conservation
projects through an agreement with Honeywell; and
WHEREAS, as a result of the reduction in energy use realized from these projects and the
decline in the actual per unit cost of natural gas, heating fuel, and diesel and
unleaded gasoline experienced during the year, considerable savings were achieved
from the amounts actually budgeted; and
WHEREAS, the Council has previously approved financing the cost of these energy conservation
projects through a lease/purchase agreement in the amount of $1.2 million; and
WHEREAS, the amount to be lease/purchased can be reduced by applying energy cost savings
realized to date against the capital cost of these projects, thus reducing interest
costs and lowering annual principal payments; and
WHEREAS, such an approach will allow the City to more rapidly see the impact of these
changes on our overall budget;
NOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT
the Finance Director is hereby authorized to transfer unexpended energy appropriations within
the General Fund to the necessary account to be used to partially fund the costs associated
with the City's energy conservation projects, provided that:
1. the total amount of such transfer does not create an over expenditure of the total
authorized departmental appropriation of any department from which such a
transfer shall be made; and
2. the amount to be transferred shall be reduced by the amount, if any, that actual
total General Fund revenues do not meet the City's Fiscal Year 2009 budget.
IN CITY COUNCIL
MAY 27, 2009
(TITLE,) Authorizing the Transfer of
Unexpended Energy Appropriations
W; hin the General Find to Partially
Fund the Costs Associated.with the
City's _F.aezox ramcorvati an PP nj prtg
Assigned to Councilor