CC MIN 05312022 - Laserfiche WebLink

primarily the parking lot and the entry. Interim City Manager Dolan reported it was not changed but there is a lot of work to be done on the inside. Councilmember Balch requested a brief overview of the CaIPERS outlook based upon the prior budget where there was a 21% return. Interim Finance Director Shah explained that CaIPERS sets the rates for the City and then they set a discount rate. She advised in prior years the City received a 7% discount rate which was reduced this year to 6.8% based on the 21% rate of return the City experienced in fiscal year 2021. The indication is that the next year is not going to be as strong and believes there will be a significant drop in the rate of return in CaIPERS. She explained that as long as CaIPERS is making more than the discount rate by 2% the City's rates will not go down. She noted if it is within 2% then there is a potential to reduce the discount rate to 6.6% which will impact the City's financial situation. Councilmember Balch inquired if staff looked at other uses for General Fund Surplus such as bolstering the lower income housing fund or other areas outside of just CIP for that use. Interim Finance Director Shah explained when the City experiences a surplus it goes to CIP and then to the Repairs & Replacement Fund. She advised anything else is based on policy and if any other programs are eligible for additional funding. Councilmember Balch noted the City just passed drought rates and thought it would help with the solvency of the fund without having to pull back the CIP. Interim Finance Director Shah advised this is an additional $3.1 million revenue reduction and the strategy will have to be based on rates and how it is proposed and brought forward. Director Yurchak explained revenue for the drought rates that were implemented on May 1 will not be seen until it is billed in July so the revenue collected will go towards the Fiscal Year 2022/23 revenues. Councilmember Balch referenced the staff report stating a $3 million revenue shortfall associated with water conservation and now $1.1 million of CIP is being pulled back from the Enterprise Fund. Director Yurchak explained staff is trying to be conservative in the City's CIP projects as it goes through the rate study and noted waiting until the Water System Management Plan is completed will help inform future CIP projects. Councilmember Balch inquired what the water revenue decrease would be if the drought rates were not in place. Director Yurchak believes it would be at least $6 million. Councilmember Balch inquired about the I-680/Sunol Boulevard interchange and where it falls in this process. Traffic Engineer Tassano reported the project is still in the design phase and there is some delay with Caltrans. He advised there is 12 to 18 months of detailed design to work through and it would be premature look at construction funding. Mayor Brown reported the Alameda County Transportation Commission (ACTC) and Tri-Valley Transportation Commission (TVTC) are two of the funding sources for that project. Traffic Engineer Tassano confirmed the City also goes after ACTC and TVTC funding. He noted that ACTC funding is difficult to obtain because the City is not a disadvantaged community. Councilmember Balch inquired about the status of the Lions Wayside Park bandstand. Interim City Manager Dolan reported in will be in a revised Master Plan and it will be a substantially different project with its own expense. Mayor Brown inquired about the miscellaneous CIP General entry for $7.9 million and the miscellaneous General CIPR. Interim Finance Director Shah explained that is the CIP General Fund contribution and is part of the transfer from the General Fund year-over-year. She noted that $3.6 million was added to the balance for a total of $10 million. She clarified the miscellaneous General CIPR is a smaller reserve. City Council Minutes Page 7 of 11 May 31, 2022