CCMIN06062017 - Laserfiche WebLink

budgets. She also addressed CaIPERS challenges, including new policies to accelerate pension contributions, additional annual payments, liabilities and prepayments. Mayor Thorne clarified that this is just a review of the budget and Council is not approving it now. In reply to Councilmember Olson's question regarding an increase in Sales Tax in 2018/2019, Director of Finance Olson stated the City's consultant developed projections based on various sectors of the economy, and while it is not perfect, staff will continue to monitor it and make adjustments that will be presented during the mid-year budget review. Mayor Thorne noted that much of the sales tax difficulties are due to internet sales and Director of Finance Olson added that people are shopping at the Livermore Outlet. • Discussion followed regarding the status of internet sales updates. City Manager Fialho explained internet sales tax money goes into a County pool (which has been growing). This should be corrected with legislation but is not there yet. He addressed money allocated for CIP projects, but noted it does not come close to maintaining the City's infrastructure deficit. Councilmember Pentin commented on the surplus for 2018/2019 and noted it does not account for the increase from CaIPERS when the rate is reduced. Discussion followed regarding the impacts of CaIPERS expenditures on the City's surplus. City Manager Fialho added that staff is waiting for CaIPERS actuarial numbers and will present a report to City Council in August or September. He added the City will not feel a real impact until year three (2019/2020). Mayor Thorne pointed out that other cities are less fortunate and are concerned with avoiding bankruptcy. Director of Finance Olson reported there will be a mid-term budget in 2018/2019 and at that point, staff present options regarding funding. Councilmember Brown noted that by prepaying a large share of money in June, two years ago, the City saved $23 million and stressed that prepayment is an important idea in prefunding the PERS debt, as it will save the City a lot of money. She asked about the line item relative to printing and film development and Director of Finance Olson reported it is the cost of printing the City's newsletter and other publications. Councilmember Brown stated she wants to make sure the City is doing everything it can to prepay its PERS debt. In response to her inquiry, City Manager Fialho reported in the case of 2016/2017, at the mid-year mark, staff released revenues were coming in higher than what was projected. Staff took the surplus at mid-year and did a prepayment. He added that projections, for the next two years, show that, if the City is going to meet its commitment ($5 million per year into the CIP), there is no surplus. If there is a surplus, it will be used towards a prepayment towards PERS. He added various options will be considered before presenting a recommendation to City Council. Director of Finance Olson reported PERS discount rates are not set in stone and staff would like to evaluate the matter once it has more information. Councilmember Brown wondered if the City has a spending problem and stressed the importance of being fiscally careful. Director of Finance Olson presented details of the Capital Improvement Program (CIP) including funding status, categories, and the process. A comparison of available CIP financial resources by City Council Minutes Page 6 of 8 June 6, 2017