City Council
MEETING DATE: 6/10/2015
TITLE:
Title
Supporting Resolutions for the FY 2015-16 and 2016-17 Operating Budgets
End
FROM:
Tami E. Scott, Administrative Services Director
RECOMMENDATION:
Recommendation
Staff recommends that the City Council adopt the supporting resolutions for Fiscal Year (FY) 2015-2016 and (FY) 2016-2017 Operating Budgets.
Body
BACKGROUND:
The economic recession that began in FY 2007/08 had a significant effect on City revenues and made it even more difficult to meet the challenge to have a balanced budget. The City continues to face the challenge of "living within our means" and the FY 15/16 and FY 16/17 biennial budget has been prepared in the midst of the continued economic recovery we are experiencing. Core revenues, such as property tax, sales tax, hotel tax, permits, and licenses are showing slow and steady increases from the all-time lows the City experienced in FY 08/09. Today, all categories are showing slow but stable improvement. Revenue generating measures such as Measure L (Utility Users Tax) passed in November 2008, and Measures H and B (Transactions and Use Tax) in November 2010 and June 2014, respectively, have aided the General Fund in securing stable revenues. City Management continues to streamline processes wherever possible to efficiently deliver services in the most cost effective manner. Under the direction of City Council and the City Manager, City staff continues to pursue alternative means of generating revenues while reducing costs
DISCUSSION:
Over the past several months, department heads, in conjunction with the City Manager, have reviewed and addressed departmental needs and their ability to deliver an acceptable level of services to the community, while at the same time preparing a budget that incorporates the achievement of Council's adopted goals. In preparing this biennial budget document, the City Manager and staff used their best efforts to identify and estimate financial resources available to the community. This budget is a thoughtful attempt to balance the projected revenues and planned expenditures in a way that focuses on the community's most critical needs and Council's priorities.
The budget is an ongoing year round process whereby quarterly and mid-year reviews of revenues and expenditures are completed to determine and assess any changes that may be needed. Most recently, the formal biennial budget process for the next two-year cycle commenced at the beginning of January 2015 with City staff preparing department/division line item detail worksheets for dissemination and Departmental review/feedback. After City Management review in early March, a detailed line item budget workbook was provided to City Council and all departments on March 17th. City Council members reviewed the workbook and independently provided questions back to staff for clarification of expenditures and recommended changes. At the April 8th and 22nd City Council study session meetings, City staff briefed City Council and the community on the General Fund, the Special Revenue and Internal Service Funds, and the Capital Improvement Project (CIP) Plan to discuss the allocations planned for the upcoming biennial budget. In addition, staff provided feedback regarding Council's questions and had a detailed discussion about the budget to include, but not limited to, municipal debt, physical assets, retirement plans and other post-employment benefits (OPEB). The final proposed budget also incorporated updated direction from the City Council to include three additional, but unfunded, Capital Improvement Projects, Dog Park Replacement, Cove West Wash Park, and relocation of Fire Station 411.
For FY 15/16, the budgeted revenues are $33,402,175 and the budgeted expenditures are $33,385,118, resulting in a net surplus of $17,057. For FY 16/17, the budgeted revenues are $34,909,086 million and the budgeted expenditures are $34,888,810, resulting in a net surplus of $20,276. By presenting a balanced budget for FYs 15/16 and 16/17, the General Fund should retain a fund balance of $12.2 million, which surpasses our policy of maintaining a minimum of 33% budgeted expenditures, which is $11.1 million in FY 15/16 and $11.6 million in FY 16/17.
FISCAL IMPACT:
See the previously distributed proposed Biennial Budget on file with the City Clerk's office.
ATTACHMENTS:
Budget Message
Supporting Resolution