The City of Steubenville, Ohio Municipal Building Improvement Bonds, - - PowerPoint PPT Presentation

PRESENTATION TO STANDARD & POOR’S

BY

The City of Steubenville, Ohio

Municipal Building Improvement Bonds, Series 201

October 21 , 201 is

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Table of Contents

SECTION I: Rating Presentation by the City of Steubenville, Ohio

Cathy Davison, City Manager Alyssa Kerker, Finance Director Michelle Hillstrom, Underwriter

SECTION II: Strategic Plan 201 0-2020 SECTION III: Statement of Financial Policy SECTION IV: Investment and Deposit Policy

City Complex

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Page 2

Quality of Life: Location

Steubenville is the County Seat

• f Jefferson County, Ohio.

The City is located in the tri- State Region of Ohio, Pennsylvania and West Virginia. Due to it proximity, the City is considered a suburb of Pittsburgh, Pennsylvania.

Downtown Pitt sburgh is 36 miles from the Veterans' Memorial Bridge, which brings U.S. Route 22 across t he Ohio River and into Steubenville. More than 41 ,000 cars and trucks cross the Veterans' Memorial Bridge daily.

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Downtown Steubenville is less than 30 miles from the Pittsburgh International Airport. The drive from Steubenville to the Pittsburgh airport is often quicker than from downtown Pittsburgh. The completion of the Findlay Connector shortened the drive time even further. The Jefferson County Airpark is expanding its runway to 4,400 feet to accommodate larger airplanes. An extension to 5,000 feet is being planned. Fuel, hangars and conveniences for pilots are available at the Airpark. Jefferson County has six ports on the Ohio River, more than any other county in Ohio. The Ohio River carries more freight tonnage than the Panama Canal and is at

• nly 30 percent capacity.

Steubenville is serviced by the four-lane Highways U.S. Route 22 and State Route 7. Interstates 70, 76 and 79 are 30 miles away. Improvements to U.S. 22 have helped make Pittsburgh an easy commute. It allowed Wal-Mart to build a massive 880,000-square-feet distribution center near the interchange with S.R. 43. The US 22/US 36/OH 1 6- corridor continues to hold promise as the most direct route between Pittsburgh and Columbus.

Quality of Life: Location Continued

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Page 4 History:

Steubenville and the communities that surround it, were historically defined by the steel industry. Corporations such as Mittal Steel (formerly Weirton Steel) and Severstal International (formerly Wheeling-Pittsburgh Steel Company), as well as various coalmines operating in eastern Ohio and in nearby West Virginia reduced or eliminated their workforce in order to become more efficient and competitive against other steel producers. In its heyday during the 1 960s, Wheeling - Pittsburgh Steel employed more than 9,000 people at its Steubenville operations.

Quality of Life: Cultural Foundation

Those working in the Pittsburgh area enjoy significantly lower property taxes while living in Jefferson County. Steubenville City Schools is rated Excellent by the Ohio Department of Education. For a little history, education and culture, there is the Historic Fort Steuben, a reconstructed, 18th-century fort. Steubenville hosts three festivals-the Old Fort Steuben Festival, the Dean Martin Festival, and the Grecian Food Festival. The Dean Martin Festival is celebrated in honor of the actor and singer, who was born in Steubenville. Steubenville is home to many local parks including Pizza Pie Park, Beatty Park, Devonshire Park , Linda Way Park, Jim Wood Park and Belleview Park.

Present Day: Today, as the Steubenville Severstal Facility remains moth-balled, the City continues to re-invent itself. Perhaps

the best feature of the City is its situation within the tri-state area. This "best-of-both-worlds" location allows residents to enjoy both small town living and also the benefits of being a "suburb" of the exciting, fast-paced city of Pittsburgh. The City’s cultural attributes include:

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Page 5 The Trinity Health System Facilities include:

Trinity East offers a variety of services including Skilled Care, Long-term Care, Inpatient Physical Rehabilitation and Behavioral Medicine Services (Mental Health & Addiction Recovery.) Outpatient services include physical rehabilitation, cardiac rehabilitation and associated diagnostic services. Trinity West is a full service acute care facility offering 24 hour emergency care, kidney dialysis, lithotripsy, endoscopy and related services, surgery and medical surgical inpatient units and all other diagnostic departments. The Tony Teramana Cancer Center also provides Chemotherapy and surgical consultation services for regional residents. The Chemotherapy Services at The Tony Teramana Cancer Center is provided with compassion, privacy and optimum results. The Trinity Outpatient Endoscopy Center offers gastroenterology patients a state-of- the-art facility for endoscopy procedures. The Trinity Heart Center provides diagnosis, intervention, open heart surgery and rehabilitation for area cardiac patients. The Center opened in 2001 and has provided nearly 2,000 open heart procedures and 1 2,000 cardiac interventions. The Women’s Health & Birth Center provides a full array of women’s health services from childbirth to surgical recovery. Trinity Health System comprises the most complete health care option in eastern Ohio. The hospital system includes Trinity East and Trinity West which has a combined capacity of over 470 beds and employs more than 1 ,800 people. The Health System is the City’s largest employer.

Local Economy: Healthcare

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Local Economy: Healthcare Continued

Riverside Medical is a multi-specialty physicians group that provides high-quality, cost-effective health care to the Ohio Valley and is one of the City’s top employers. Riverside has locations throughout Jefferson County and offers primary care, internal medicine, cardiology, gastroenterology, neurology, general surgery, vascular surgery, pulmonology, sports medicine and infectious disease care. In downtown Steubenville, the Heart, Vascular and Rhythm Center allows cardiac patients one location for all necessary testing including EKG, stress tests and pacemaker as well as a coumadin clinic, complete lab services and more. Five board- certified cardiologists are on staff and available 24 hours a day for emergency intervention. Valley Surgery Center, opened in 2002 is located in Steubenville, is a freestanding multi-specialty surgery center owned by 1 5 local

• surgeons. The Center is proud to offer state of the art equipment

to provide unique surgical intervention such as CT guided sinus surgery, orthotripsy and PVP laser procedures. The "Center for Surgical Excellence" provides quality clinical and business office staff to care for its outpatient clients.

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Page 7

Local Economy: Higher Education

Franciscan University of Steubenville is a

private school located in Steubenville that emphasizes the formation of strong, moral character and critical thinking. It enrolls over 2,000 students from all 50 states and over 40 foreign countries. It has been recognized as one

• f the best Catholic universities in the country by

U.S. News and World Report, the Templeton Foundation, Barron's magazine, National Review and the National Catholic Register. Franciscan's business courses are the most popular in the curriculum; the elementary education program serves over 1 70 majors; the psychology and mental health and human services programs have sent more than 335 graduates to 82 graduate schools throughout the country, all of whom have successfully completed their advanced degrees; the nursing graduates have achieved a high success rate in passing their state board exams; and the math, science and pre-med programs produce exemplary

• graduates. Franciscan University has earned an

international reputation for its theology program as well. Grounded in Sacred Scripture and tradition, the program attracts more undergraduate theology majors than any other Catholic university or college in the country.

Franciscan University is the City’s 3rd Largest Employer

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Page 8 The Eastern Gateway Community College is a public, two-year institution of higher education, the college brings affordable and accessible education to the Ohio Valley. Two-year associate degrees as well as numerous certificate programs of study are offered throughout the year. The college supplies accredited classes to prepare students for a career directly after college or to transfer college credits to four-year

• institutions. Career preparation classes are available in the areas of business, computers, engineering and

information technologies, law enforcement, pre-kindergarten care, and health sciences. Many agreements exist between EGCC and other colleges and universities for transfer of EGCC credits. EGCC now has a building dedicated to the training and retraining of the Valley's workforce. The facility contains the latest in computer technology for short- or long-term customized training. The college also offers a wide variety of noncredit classes, ranging from computers to skill building and from senior topics to fitness. The College is a focal point for many community activities. Cultural events, community service projects and entertainment activities are set throughout the year. Many nonprofit groups take advantage of the free use

• f the college's facilities.

Local Economy: Higher Education continued

EGCC is the City’s 4th Largest Employer

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Page 9 Fort Steuben Mall This is an 823,049 square foot regional retail mall anchored by Macy' s, Sears, JC Penney, and Steve & Barry' s Sportswear, with Dick' s Sporting Goods and Wal-Mart Supercenter in freestanding structures at the site. Located ¼ mile from US 22 (primary east-west thoroughfare) providing direct commuter access to Pittsburgh to the east. The Fort Steuben Mall, which opened in 1 974, is undergoing a modernization project which is expected to be completed this year. The modernization project allowed for the opening of the new Social Security offices in the mall. A new Aspen Dental building was constructed near the main entrance of the Mall earlier this year and held its grand opening in early summer.

Local Economy: Commercial Base

Gross Leasable Area: 823,049 SF Traffic Count: 1 05,000 Total Space Rentable: 62,764 SF Property Type: Shopping Center Property Sub-type: Regional Center

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Downtown Historic Business District A can-do attitude has taken a firm hold on the historic downtown business district. Since the beginning of 201 0, a variety of new and unique businesses have opened their doors in the downtown business

• district. Some of them are already contemplating expansion. In

addition to the variety of businesses already opened, there are eight additional storefronts currently under development with specific announcements of tenants coming in 201

• 0. As outlined in the City’s

master plan, downtown Steubenville is beginning to take shape as a lifestyle center. A lifestyle center is a pedestrian-friendly center where citizens will now have the opportunity to work, shop in unique stores, dine at quaint eateries, take in entertainment and cultural events and live downtown again in trendy, loft apartments. This is not some theoretical plan for some future time, but is representative of what is currently occurring throughout the downtown area. Unlike many cities, historic Steubenville is very fortunate to have retained a significant infrastructure of grand, historic buildings which many cities can only dream of having available for redevelopment. It is important to note that all of this is happening through private development and investment, not through government funding.

Local Economy: Commercial Base continued

Wal-Mart Distribution Center In 2002, Wal-Mart built an 800,000 square foot distribution center at the largest development site in eastern Ohio, located within five miles (8 km) of Steubenville. The new Findlay Connector that was built in western Pennsylvania had a large impact

• n the economy of Steubenville and was the primary catalyst for the Wal-Mart development. The trip between western

Pittsburgh, an economically burgeoning area, and eastern Ohio and the northern panhandle of West Virginia has become even shorter and more streamlined. The connector is a toll-access highway between Pittsburgh International Airport at PA Route 60 and U.S. Route 22. Wal-Mart is the City’s 5th largest employer.

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Local Economy: Economic Development

Progress Alliance, an economic development partnership between Jefferson County, the City of Steubenville and the Jefferson County Chamber of Commerce, makes it easy for businesses to locate and expand in the Steubenville-Jefferson County Area. A public-private partnership, Progress Alliance was established in 1 996 to spark and coordinate economic development activity in Jefferson County, Ohio. It is a program of the Community Improvement Corporation of the Steubenville, Ohio, Area, a 501 c(6) non-profit development

• rganization

founded in 1 963. The business community in Jefferson County has been a big supporter of these efforts. Private donors have contributed more than one million to support Progress Alliance and economic development in Jefferson County.

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Local Economy: Economic Development Continued

Plans are progressing on the Save The Grand project. The Grand Theatre in downtown Steubenville will become a functioning center for music and arts. Nelson Fine Arts and Gifts, which purchased the former Lincoln School building in 2009, has created 1 0 new jobs and expects its expansion to continue.

Some of Progress Alliance’s current projects include:

Capital Recovery System, which works with courts around the state and country to collect delinquent fines just recently added 1 5 additional employees to its ranks. The company now has more than 40 people working in its downtown location. Progress Alliance is working with a Northeast Ohio company interested in opening a new grocery store in downtown Steubenville. Construction continues on a new Walgreen’s store. Plans are advancing for a new CVS Store. It also should be noted that several sites within the City have been targeted for cleanup through a $1 million EPA grant aimed to turn brownfields into “ greenfields”

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Financial Position: General Fund G.A.A.P. History

GENERAL FUND G.A.A.P.

2007 2008 2009 Beginning Balance 934,784 $ 1,310,921 $ 203,028 $ Revenues 2007 2008 2009

Income Taxes 7,834,852 $ 7,654,593 $ 7,783,318 $ Property & Other Taxes 1,320,875 $ 1,193,514 $ 1,146,976 $ Intergovernmental 3,030,950 $ 2,063,036 $ 1,909,192 $ Charges for Services 113,196 $ 107,288 $ 99,086 $ Licenses and Permits 498,424 $ 574,004 $ 456,842 $ Investment Income 235,602 $ 148,934 $ 87,574 $ Fines and Forfeitures 344,299 $ 326,745 $ 343,711 $ Rental Income 86,991 $ 102,971 $ 88,750 $ Other (Including Transfers In) 156,521 $ 91,191 $ 168,981 $

Total Revenues 13,621,710 $ 12,262,276 $ 12,084,430 $ Expenditures 2007 2008 2009

General Government 2,970,717 $ 2,607,017 $ 2,605,297 $ Security of Persons and Property 7,714,091 $ 7,854,420 $ 7,580,391 $ Public Health and W elfare 490,409 $ 549,003 $ 567,418 $ Community Environment 62,828 $ 60,617 $ 95,009 $ Leisure Time Activity 781,700 $ 904,076 $ 704,556 $ Capital Outlay 24,406 $

• $
• $

Transportation 1,091,139 $ 1,236,673 $ 1,105,207 $ Debt Service 110,283 $ 158,363 $ 149,377 $ Other (Including Transfers Out)

• $
• $
• $

Total Expenditures 13,245,573 $ 13,370,169 $ 12,807,255 $

Excess of Revenues & Other Financing Sources Over (Under) Expenditures and Other Financing Uses 376,137 $ (1,107,893) $ (722,825) $ Fund Balances (deficit) at Beginning of Year 934,784 $ 1,310,921 $ 203,028 $ Fund Balances (deficit) at End of Year 1,310,921 $ 203,028 $ (519,797) $

Balance as a Percent of Revenues 9.62% 1.66%

• 4.30%

Fortunately, the City has been able to weather its economic downturn with its historically comfortable General Fund balances. Although the structural imbalance persisted in 2009, the City was able to reduce its magnitude with timely budget cuts. While the City’s 2009 G.A.A.P balance was negative, the cash balance was

• ver

$265,000.

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Financial Position: Historical General Fund Operations

For the years 2008 and 2009, an operating deficit in the General Fund required the use of prior years surpluses. In March 2009, the 201 0 projected operating deficit for the General Fund was $1 ,806,441 .

After exploring all avenues and options for cost savings, the following measures were implemented:

* The City offered an Early Retirement/Resignation Inventive Plan to reduce workforce * Fire Union concessions * Non-Union pay decrease of 3.5% * Layoffs in Police and Fire * The City also received stimulus money in the total amount of $433,790 for retaining three police officers; $1 44,596 of the grant was received in 201 * The City’s Financial Policy was amended to utilize interest earned for the General Fund. 201 0 Projected Shortfall as of March 2009 $1 ,806,441 .00

Non-Union Union Concessions 3.5% Pay Rate Concession $64,681 .80 City Manager- Secretary $40,744.1 4 M&R-Street Supt Replacement $49,783.61 Building-Building Inspector $1 6,31 6.27 $1 71 ,525.82 $ 1 ,634,91 5.1 8 Health Department Transfers $47,544.00 Municipal Court Grant $45,023.00 $1 ,542,348.08 Fire Union Concessions 3.5% Pay Rate Concession $ 1 05,900.82 $1 05,900.82 Uniform Allowance $ 1 9,550.00 $1 9,550.00 (3) Employee-Layoff $ 1 84,486.32 $1 84,486.32 $309,937.1 4 $ 1 ,232,41 0.94 Police Union Concessions 3.5% Pay Rate Concession ($1 1 1 ,637.61 ) Uniform Allowance ($23,520.00) (6) Employee-Layoff $303,938.34 Part-Time Parking Attendants $29,335.85 Stimulus Funds $1 40,000.00 $473,274.1 9 $ 7 59,1 36.75 Retirement Incentive Dispatch-Replace with Police Officer $3,424.87 Finance-Account Clerk II $44,981 .39 $48,406.26 $ 7 1 0,730.49 AFSCME Union Concessions 3.5% Pay Rate Concession ($71 ,368.22) Police-Matron/Clerk Typist $41 ,675.46 Police-Clerk Typist I $43,547.82 Police-Clerk Typist II $41 ,534.74 Building-Secretary

• $3,781

.26 Building-Custodian $43,366.26 Building-Maintenance Repair $47,284.1 4 M&R-Maint Worker II CDL $44,371 .91 M&R-Maint Worker II CDL $44,371 .91 M&R-Maint Worker II CDL $44,371 .91 M&R-Heavy Equipment Operator $48,41 3.60 Recreation-Secretary $44,249.65 Recreation-Maint Worker I $44,371 .91 Recreation-Foreman $50,660.53 $534,438.58 $ 1 76,291 .91

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As 201 0 stands now, the operating deficit predicted early in 2009 has been reduced to just over $1 20,000. Possible factors that may increase that projected balance are:

* Increase in Income Tax Collections due to participating in the Subpoena

Program with R.I.T.A. for non filers. The program generated a liability

• f $86,068.21

and during just that week, $7,923.00 was collected. * A final settlement from Estate Taxes has not been received and cannot be estimated by the state or county at this time. Currently, while the revenue budget is prepared conservatively, there are no additional funds budgeted for this revenue if it were to be received by the City. * Continual collaboration between departments to recognize cost savings and operate more efficiently.

Financial Position: Historical General Fund Operations

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Financial Position: 201 1 Budget

With the change in administration and steering clear of old strategies, the new approach is to address issues and possible savings or revenue sources “before” budget issues arise. Budget Revenue Enhancements: * Continually evaluate department needs versus wants. * Receive stimulus money of $7,829,671 .1 5 for Washington Street Rehab Project. * Receive stimulus money of $579,51 0.02 for Traffic Signal and Street Lighting. Project will replace all old style bulbs with energy efficient LED bulbs. * Receive a federal grant for the Sunset Resurfacing Project of$1 ,379,456.95. * Receive a federal grant for the Sunset Boulevard Traffic Signal Improvement of $532,437.00. Budget Savings:

* Reorganization of the Finance and Utility Office.

* Conversion of two-way radio equipment to cellular telephones. * 33% savings in office supplies through a contract with a local vendor. * Building maintenance decreases with the construction of the new city building. * All service contracts will be reviewed for possible savings. * Departments operating procedures and practices will be re-evaluated to ensure they are

• perating in the most efficient and cost effective manner.

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Steubenville 201 0-2020: A Vision for Our Future

The City’s Council passed a 1 0-Year Plan on October 1 2, 201

• 0. This Plan will guide the City through the

next decade and address eight main social, economic and financial goals.

Goal #1 : Develop and implement a long-term infrastructure (water and sewer) replacement plan in order to revitalize and accommodate the current and future needs of the Community Goal #2: Provide an environment that is safe, efficient, and cost effective in which our employees to work Goal #3: Strengthen and diversify the economy through collaboration and planning Goal #4: Create efforts to promote “Clean-up Our Community” (litter, blighted structures, sidewalks, grass, roadways) Goal #5: Create a well trained and diverse workforce Goal #6: Create an ability to respond to emergencies on a local and regional basis Goal #7: Create a community environment that is safe and healthy

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Steubenville 201 0-2020: Fiscal Responsibility

Continue to provide the public with financial updates and budgets through all means of technology (website and e-mail) in order to provide transparency Pursue insurance claims for accidents the fire department has responded

Create a fund balance policy that will prepare the city for its future needs by creating a “savings account” Create a capital improvement fund policy that sets funds aside in the expenditure budgets for future equipment and facility needs

Explore federal, state and foundation grant opportunities while talking into account the administrative and grant requirements prior to submitting the grant Create a budget process that will provide a system of budget workshops to inform council of Department needs

Implement a balanced budget approach that does not utilize left over funds from previous years in

• rder to balance the budget

Investigate the refinancing of debt Be more aggressive with the collection of income taxes and utility bills

Goal #8: Create an atmosphere of fiscal and regulatory responsibility

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Steubenville, Ohio: Credit Highlights

The City benefits, both economically and financially, from its Tri-State location and its proximity to Pittsburgh. Through a concerted effort by the City, the County and local businesses, the community continues to re-invent and strengthen its local economy. The City’s largest employers are no longer associated with the heavily cyclical manufacturing

• sector. Rather, its top employers are in the healthcare, government and higher education

sectors. As with most cities, Steubenville has seen a recent decrease in its income tax collections and, subsequently, a decline in its General Fund reserve. That being said, through budget cuts and policy changes the City has lessened its operating deficit from almost $1 million in 2008 to just

• ver $1

20,000 in 201 0. With the recent passage of its Strategic Plan, the City expects to begin implementing its many financial goals beginning in 201 1 . The most important of these goals in the establishment of a minimum General Fund balance. The City’s debt levels remain low.