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8. MOTION: It was m/s by Brown /Cook - Kallio to waived full reading and adopt Resolution No. 14- 713 declaring as surplus two fire engines, and authorize the City Manager to execute an agreement with Pleasanton Downtown Rotary to donate these engines to Pleasanton's Sister City, Tulancingo, Mexico. Motion passed by the following vote: Ayes: Councilmembers Brown, Cook - Kallio, Narum, Pentin, Mayor Thome Noes: None Absent: None Chief Miguel announced that this would be his last Council meeting as Fire Chief and said what an incredible honor it has been for him to serve the Pleasanton and Livermore communities. He thanked the Council and staff for their phenomenal support and also shared how proud he was of the men and women who have come together to serve and work in the best interests of all residents of the valley. Mayor Thorne and the Council shared their thanks for his equally phenomenal service to the community. 13. Consider a resolution accepting the 2013/14FY Unaudited Financial Report for the Operating Budget and amending the 2013/14FY Operating Budget Director of Finance Wagner presented the 2013/14FY Year -End Financial Report for the Operating Budget, which includes the General Fund, Water Enterprise Fund, Sewer Enterprise Fund, Golf Course Operations Fund and Repair and Replacement Fund. She reviewed the General Fund, which began the year with a fund balance of roughly $13 million. Revenues totaled $96.5 million versus the $94.4 million that was projected. Transfers totaled $179,000 less than projected, largely due to the receipt of Happy Valley Specific Plan fees. Expenditures were projected to be $92.9 million and actually came in approximately $2.5 million less at roughly $90.3 million. She briefly reviewed revenues, noting a sizable variance in the area of sales tax ($923,000 greater than projected), hotel /motel and business license taxes, development services, franchise fees and recreation fees as well as a slight decrease in property tax revenues. Expenditure adjustments are largely attributable to personnel savings of almost $250,000 due to holding positions open during recruitment, a decrease in water purchases, contract services, legal and professional services, and PG &E expenses. Of the $4.8 million variance, staff is recommending appropriation of $2.8 million that includes a transfer to the PERS Stabilization Fund, an increase in funding ($935,000) to the Repair and Replacement Fund that would place the annual contribution at the targeted amount of $4.5 million, and additional funding ($954,000) for the Worker's Compensation Reserve for non -fire employees. The remaining $2 million is proposed to flow to the reserve balance, which would close the year at approximately $15 million. She presented a brief comparison of General Fund performance to previous years. The highest revenue and budget year occurred in 2007/08FY when revenues totaled $93.9 million. The 2013/14FY, at $96.5 million, indicates the city has finally recovered to pre- recession levels. She noted, however, that while revenues are up in many areas, sales tax has not fully recovered and interest income is down by almost $1 million as compared to 2007/08FY. Councilmember Brown asked if the city had fully funded reserves of approximately $20 million (20% of revenue) in 2007/08FY, noting that interest income is significantly less. Ms. Wagner explained that the difference stems both from a larger portfolio, which was likely close to $230 million in 2007/08FY versus the $194 million at present, and the much higher interest rates the portfolio was earning at that time. City Council Minutes Page 5 of 11 October 21, 2014