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BACKGROUND
<br /> Pleasanton has a reputation for being one of the most financially stable and fiscally
<br /> responsible cities in California resulting from years of careful financial planning, extensive
<br /> budget oversight and fiscally conservative governance. In an effort to maintain this
<br /> position, staff regularly monitors expenditures, cautiously forecasts revenues, and makes
<br /> recommendations to address changes as quickly as possible in order to maintain a
<br /> balanced Budget.
<br /> DISCUSSION
<br /> General Fund Overview
<br /> Staff recommends increasing revenue estimates by $2,964,903, primarily due to
<br /> increases in the Property Tax, Sales Tax, Hotel/Motel Tax, and Other Revenues
<br /> categories. These increases are attributed to a continued improving housing market and
<br /> increased economic activity throughout the City. Staff is also recommending an increase
<br /> in Transfers Out of$95,000, reflecting the energy savings related to installing LED lights
<br /> that will be transferred to the Miscellaneous General Fund Capital Improvement Program
<br /> Fund ("Fund 151") to make the loan payment to the California Energy Commission
<br /> ("CEC") and an increase in Transfers In to the General Fund from the Happy Valley
<br /> Development Fund of $32,000 to partially repay the Golf Course Development loan.
<br /> Increases in expenditures of $367,686 are the net result of increases in personnel and
<br /> non-personnel expenditures.
<br /> As a result of these changes, staff currently anticipates the General Fund to end FY
<br /> 2014/15 with a surplus of $2,534,218. Of this, staff is recommending $326,000 be
<br /> allocated to the 10% Reserve for Economic Uncertainties, $1 million be allocated to the
<br /> Repair and Replacement Fund, and the balance of $1,208,218 to the Unassigned Fund
<br /> Balance. Overall, the City will continue to have a balanced budget with $16.6 million in
<br /> reserves in the General Fund. After closing the FY 2014-15 budget and staff knows the
<br /> exact amount of General Fund surplus, we will recommend allocating portions of that
<br /> surplus to all or some of the following funds: (1) the PERS Rate Stabilization Fund to
<br /> reduce the City's unfunded liability, (2)the Workers Compensation Fund to address future
<br /> known liabilities, (3) the Repair and Replacement Fund, and/or (4) Capital Improvement
<br /> Program ("CIP") funds.
<br /> Table 1. General Fund Overview
<br /> Adjustments 2014/15FY
<br /> 2014115FY Approved by Midyear Budget Recommended
<br /> Midterm Budget City Council Adjustments Midyear Budget
<br /> Beginning Fund Balance $ 15,041,581 $ - $ - $ 15,041,581
<br /> Plus Revenues 97,118,741 293,650 2,964,903 100,377,294
<br /> Transfers In 840,670 32,000 872,670
<br /> Transfers Out 2,997,282 57,500 95,000 3,149,782
<br /> Less Expenditures 94,962,129 236,150 367,686 95,565,965
<br /> Ending Fund Balance $ 15,041,581 , $ - $ 2,534,218 $ 17,575,799
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