CITY COUNCIL WORKSHOP AGENDA PACKET

CITY OF PLEASANTON, CALIFORNIA 9 | eidebailly.com NO. OBSERVATION DISCUSSION 7 The City has put in place a framework of regular forecast updates and public reviews of the forecast. A key element of successful long-term financial planning consistent with best practices is to make regular updates to the financial forecast and to present it on a regular basis to leadership and the governing body. The City has implemented these practices and continues to refine its process and practices relative to the financial forecast to enhance its utility and accuracy. 8 The forecast would benefit from projecting revenues and expenditures that behave uniquely as individual line items in the detailed staff version of the forecast. As currently constructed, the forecast (in most cases) forecasts groupings of accounts at a higher level such as all salaries or all fees. As a best practice, and as a means of illustrating the thoroughness of the forecasting undertaken to stakeholders, an analysis should be undertaken to identify those revenues and expenditures that could benefit from further detailed projections. For example, salaries can be forecasted by bargaining unit to reflect current labor contracts and fees can be forecasted by category to account for unique growth trends. With this detail in the staff forecast, presentation of the information in its current form, in most settings, would still be appropriate to avoid too much detail. 9 The City has acknowledged its non- General Fund infrastructure and operations needs and is focused on addressing them. Although the primary focus of this engagement was an assessment of the General Fund financial forecast, we did peripherally look at the City’s other funds, in particular its enterprise funds. We noted that recent rate increases have improved the health of the City’s water fund but that there are still additional needs in these funds that the City is in the process of cataloging to be discussed and addressed in the future. 10 The financial forecast does not include illustrative charts and graphs or historical data. Typically, a forecast includes historical data for 2-5 years to illustrate trends and facilitate comparisons with the forecast data. Additionally, graphical depictions of data such as a line graph of historical and projected revenues by category can be useful in presentations and facilitate communication of complex information. 11 The City has proactively set aside funds for Pension and OPEB liabilities in trust funds. Many California cities have and continue to contribute the minimum amount to CalPERS and are funding their OPEB obligations on a pay- as-you-go basis. The City has proactively set aside funds for these important needs that are earning interest and will decrease long-term costs for the City. Page 18 of 33