CCMIN031511 - Laserfiche WebLink

Actions taken to balance the budget include revenue adjustments; property tax increases as confirmed by Alameda County, sales tax increases by $1.1 million, increased sales tax revenues in Pleasanton, increases of $400,000 in hotel /motel tax, increase in building permit fees of $800,000, reduced delinquent property taxes by $300,000, less interest income, and reduced recreation revenues of $380,000. On the expenditure side, adjustments involve two categories; Personnel and Non - Personnel, which total $2.86 million. Personnel reductions are slightly over $2 million and are mainly attributable to the soft hiring freeze. Sixteen (16) positions are from retirements and attrition. Currently in the actual FY 2010/11 budget there have been 11 more positions that have retired and those positions have been eliminated. Therefore, through this process, 39 positions have been eliminated in addition to labor concessions. Non - personnel reductions of approximately $740,000 is due to electricity costs over and above what was projected, water and sewer costs for City facilities, travel costs, and contract services. Regarding the Water Fund, revenues are less than projected mainly as a result of the effective date of the water rate increase and reinvestment rates on reinvestment of idle funds. On the expenditure side, a soft hiring freeze for water personnel resulted in $412,000 and non - personnel costs include electricity, chemicals, and contract services is less. As a result, staff had originally projected a balanced budget and now the budget is about $500,000 less mainly attributable to the rate increase taking effect three months later than projected. Staff plans to make this up in the next fiscal year. The Sewer Operating and Maintenance Fund's reinvestment rates are similarly less than predicted. The soft hiring freeze and reduced electricity, chemicals, and contract services has resulted in the Sewer Fund remaining balanced due to no increase in rates, which is still being monitored. The Golf Course Operations Fund's revenues are less than predicted because of reduced green fees which are less than expected at $90,000. Expenditures are also down by $285,000 due to a reduction in fuel costs, irrigation, water and postponing leased purchase of equipment for six months. The Golf Course Fund balance is back to the level it is required to be and staff is predicting it will be around $1.1 million. Ms. Wagner said this is in compliance with the City's fiscal policies which requires two years of prefunded debt service, which is at $3 million, $2 million of which is reserved in the General Fund and $1.19 million reserved in the Golf Course Fund. Regarding next steps, staff has started preparing the next two year budget. The Council sets the priorities as April 14, 2011. Staff is hoping to meet with the Finance Committee to review the preliminary budget at the end of April. Staff has proposed 3 public workshops dates as a result of the public wanting to be involved in the process and also wanting to discuss the two -year budget, as well as a 5 -year forecast and plans to control pension and personnel costs. The budget would then be adopted June 21, 2011 and would go into effect on July 1, 2011. Mayor Hosterman noted that the General Fund adjusted revenues from $83 million in 2010 to $86 million in 2011, and she confirmed the City is still down considerably from a few years ago. Ms. Wagner noted that Appendix B to the report lists several years of historical revenue information. The high was $94 million in 2007/2008 and at $86 million the City is $8 million less than the City was in 2007/08. City Council Minutes Page 5 of 7 March 15, 2011