2010-11 mid-year budget report

8/7/2019 2010-11 Mid-Year Budget Report

1/8

Claremont CityCouncilAgenda Report

TO CITY COUNCIL

FROM JEFFREY C PARKER CITYMANAGERDATE FEBRUARY 8 2011SUBJECT 2010 11 MIDYEAR BUDGET REPORT

SUMMARY

Over thecourseof the last two years staff has conducted budget analyses that haveidentified significant revenue shortfalls that have been addressed through a variety ofmeasures including the elimination of positions negotiated salary and benefitconcessions operating cost reductions and the useof onetime reVenUE S Theseefforts resulted inabudget that ended the 2009 10 fiscal yearwith a surplus Hxceedingthe amount of 611 616 that wasexpected after securitizing the State s borrowing ofCity property tax revenueThe mid year budget review for the current fiscal year comesafter the adoption of abudget where further reductions were required to achieve a balanced budget Thecurrent budget is reflective of conservatism in developing revenueand expenditureestimates and the results todate indicate that theCity isoncourse to remainwithin theconstraints of theCitys 2010 11 adopted budgetStaffRecommendation

Staff recommends the following1 That theCityCouncil receive and file the2010 11 Mid Year Budget Report2 That theCity Council

a Appropriate 46 643 from Redevelopment Agency fund balance to paythe Fire Services Agreement tothe Los Angeles County Fire Departmentb Approve a monthly stipend of 1 000 plus 1 000 in annual expensereimbursements for the Crime Free Multi Housing Coordinator andappropriate 6 000 from the Redevelopment Agency s Housing Fund forthe remainder2010 11 and 13 000 for 2011 12 for this purposeANALYSIS

Staff has reviewed year todate revenueand expenditure data toevaluate the status ofthe current budget The analysis suggests that revenuesand expenditures to datearein line with budgetary estimates and that the General Fund budget should continue tobebalanced at year endStaff has also reviewed the financial data of other operating funds and noted anysignificant variances from the adopted budgets and where necessary recommendedadditional appropriations to fund expenditures not included in the adopted bud Jet

FORCITYCOUNCILAGENDA ITEM 1


2/8

City CouncilFebruary 8 2011Page 2 of 7

General Fund Revenues

Given the state of the economy and the uncertainty of its rebound staff developedrevenue estimates during the development of the 2010 12 budget tlhat wereconservative in terms of growth Based onthese estimates General Fund revenuesincluding transfers in from other funds were projected at 20 582 800 for 2010 11Revenue trends for the year todate indicate that theCity shouldmeetorslightly exceedthis projectionProperty Tax The current year budget for property taxes is 6 621 000 To date

1 382 883 has been received from Los Angeles County representing approximately21 of the budgeted amount This is typical for the first half of the fiscal year since thefirst remittance is typically not received until November The bulk of property taxes arereceived in April May and June of each fiscal year Based onrevenuesfor t leyear todate it isanticipated that the budgetaryestimate will be metSales Tax Sales taxwasbudgeted moreconservatively than other GenEHal Fundrevenuesprimarily because of the high level of uncertainty of any economic recoveryTo date 562 626 has been received This is also fairly typical considE ring thatrevenuesreceived in July and August are accrued to the previous fiscal year and thatamounts deducted from remittances for the Triple Flip are repaid later throughproperty tax remittances in January and May Like property tax the bulk of sales taxrevenueis received during the second half of the fiscal year Indications from HDL theCity s sales taxconsultants arethat the 2 500 000 revenuebudgetwill bemetUtility UserTax UUT UUT revenuesarereceived a month in arrearsfrom the utilitycompanies therefore the revenuesreceived through December 31 2010 rE flect fivemonths of payments Revenues of 1 819 206 to date are almost exactly ontarget fortheCity tomeetorslightly exceed its budget of 4350 000TransientOccupancy Tax TOT TOT revenuesare also received a month in arrearstherefore the receipts of 377 623 to date reflect five months of payments for thecurrent fiscal year Based onrevenuesthrough December 31 2010 it is anticipatedthat the full year budget forTOT of 875 000 will be metBusiness License Tax The bulk of business license renewals representingapproximately 67 of revenue arereceived during the second half of the fiscal yeartherefore revenuesof 231 633 through theend of December against a full year budgetof 750 000 aretypical Based onyear todate receipts it is anticipated that the fullyear budgetwill bemetLicenses Permits The full year budget of 637 200 is comprised of building publicworks grading and miscellaneous permit revenuesAt the midpoint of the fiscal yearbuilding permit revenuesareat approximately 46 of budgeted figures public workspermit revenuesareat approximately 62 and grading permits areat approximately36 Overall license and permit revenuesthrough December 31 2010 total 299 730It is anticipated that upcomng projects not included in original budget estimates willgenerate sufficient revenuetomeet the budgeted amount


3/8


4/8

CityCouncilFebruary 8 2011Page 4of 7

General Fund Expenditures

As with revenuesexpenditure estimates developed for the 2010 12 budgetwerebasedonactual costs and anticipated increases Staff attempted to capture all cost increasesassociated with salaries and benefits and projected increases in operating costs thatwerelikely tooccurTheoutcomewasa budget that represents atrue reflection ofwhatthe City s General Fund costsarelikely to be at theend of thefiscal year Expendituresto date are in line with budgetary estimates and it is anticipated that barringunforeseen circumstances full yearGeneral Fund expenditures including transfers outtoother funds will not exceed thebudget of 20 581 250Figure 2 below shows the General Fund expenditure budget by department andincludes year todate actuals aswell asthe percentage of budget they represent Intotal 11 212 060 has been expended as of December 31 2010 representingapproximately 54 of the full year budget

Figure 2 General Fund Expenditures through December 31 2010ADOPTED YTDEXPENDITURES BUDGET ACTUAL

OFBUDGET

Admnistrative ServicesFinancial ServicesCommuni ty Deve lopmentPoliceCommunity ServicesHuman ServicesTransfers Outto Other Funds

3 619 067626 0542 1148108 807 9861 551 7722 398 9821 462 579

2345 739302 443

1 048 5104319 837661 705

1 077 2461 456 579

648248314915849 1 0442 6444909959

Total 20581 250 11 212 060 5448

Administrative Services The Administrative Services Departments expendituresthrough December 31 2010 represent approximately 65 of its budget of 3 619 067for 2010 11 There areseveral reasonsfor this variance from the 50 that would beexpected to have been spent by the midpoint in the fiscal year They include thepayment of 235 000 to PERS in July to prefund the early retirement incentivesauthorized by theCity Council in July 2009 and the payment of 1 3 1 19 7 in generalliability and workers compensation insurance deposits in July 2010 TheAdministrativeServices Department is ontrack to stay within its full year budget for the remainder ofthefiscal yearOther Operatina Departments As is noted in Figure 2 the remainder of the CitysGeneral Fund operating departments have expended between 43 and 50CYo of theirfull year budgets asof December 31 2010 with nodepartment exceeding the 50 thatwould be expected at the midpoint of the fiscal year It is expected that eachdepartmentwill end the fiscal yearwith expenditures that do not exceed their budgetedamounts


5/8

CityCouncilFebruary 8 2011Page 5of 7

Other Funds Revenues

Revenues in theCitys special revenue capital projects enterprise and internal servicefunds arealsoontarget to meet budgetary estimates Aswith theGeneral Fund theserevenueshave been budgeted conservatively and the general adherence to the budgetreflected in year todate receipts is reflective of this Any significant variances from thebudget throughDecember 31 2010 that staff believes may result in a significant budgetvariance at year end arediscussed belowDrainaae Fund Year todate drainage fee revenuesof 68 682 have excE eded theadopted budget of 40 000 by 28 682 These fees are collected when newdevelopment occursDrainage feesareused to fund capital projects such asthe designand construction of storm drainsSanitation Fund Special bin rental revenuesreceived through December 31 2010represent only 35 of the full year budget of 848 000 These revenuesarereceivedfrom the rental of bins roll offs and low boys used to dispose of household waste andconstruction debris Year to date datasuggests that full year revenueswill fall short ofbudgetary estimates by approximately 260 000 Increased construction activity in thesecond half of the fiscal year may result in slightly higher revenuesand a smallerrevenue shortfall Allother Sanitation Fund revenuesareontrack tomeetorexceed fullyear budget estimatesCemetery Fund Cemetery charges for service total 188 377orapproximate ly 67 ofthe full year budget of 282 000 through the first half of the fiscal year Increasedcemetery fees and strong sales of space will likely result in cemetery revenuesthatexceed the budget for thefiscal yearRedevelopment Aoencv Tax increment revenuesfor the first half of the fiscal yearexceed the amounts that would usually be expected and given the increase inassessed value of property within the redevelopment project area for 2010 11 it isprojected that revenueswill exceed the adopted budget by approximately 200 00040 000 of which will be allocated to the Agency s Housing FundOther Funds Expenditures

Expenditures in the Citys special revenue capital projects enterprise and internalservice fundsarealsogenerallyontarget tomeet budgetaryestimates Once again theadopted budget reflects staff s best knowledge of current actual costs and anyanticipated increasesRedevelopment Aaencv The Redevelopment Agency has been billed by the LosAngeles County Fire department for their share of property tax increment to fund fireprotection services in the City of Claremont The actual amount paid toLA Countytotals 363 643 or 46 643morethan the budgeted amount of 317000 Thl3 amountof the payment is linked directly to increased tax increment revenue Staff willrecommend that the City Council appropriate funds from Redevelopment A g EC Y fundbalance for the additional payment to the County


6/8

City CouncilFebruary 8 2011Page 6of 7

Crime Free Multi Housina Coordinator At a recent City Council meeting the Councilindicated a willingness to provide a small stipend for the Crime Free Multi HousingCoordinator a volunteer position TheCityCouncil received a request toapprove sucha stipend from Jim Keith thechairman of theCommittee for Safe and Healthy HousingThat request canbe found in Attachment A to this report Staff recommends that theCity Council approve a monthly stipend of 1 000 and 1 000 per year inreimbursements for incidental expenses Further staff recommends that the CityCouncil appropriate 6 000 from the Redevelopment Agency s Housing Fund for theremainder of the 2010 11 fiscal year and 13000 to fund the stipend and expenses in2011 12Recommended Aporopriations fromOther FundsStaff recommends the following appropriations

1 Appropriate 46 643 from Redevelopment Agency fund balance to pay the FireServicesAgreement to Los Angeles County Fire Department2 Approve a monthly stipend of 1 000 plus 1 000 in annual expensereimbursements for the Crime Free Multi Housing Coordinator and appropriate6 000 from the Redevelopment Agency s Housing Fund for the remainder of2010 11 and 13000 for 2011 12

State Budaet ImpactsonRedevelopmentGovernorJerry Brown s preliminary 2011 12 budget proposal includes theelimination ofredevelopment agencies in California Few details regarding the structure of theproposal areavailable however the elimination of redevelopment agencies such asClaremonts could have significant effectsThe Claremont Redevelopment Agency is expected to generate approximately 31million in property tax increment revenue net of pass through payments in 20 11 12In 2011 12 the 31 million allocated to redevelopment and housing is budgeted in thefollowing areas

EXPENDITURES REDEVELOPMENT HOUSING

DebtService 1 526 347 281 750Salaries Benefits 411 251 186 590Admnsitration 130 855Economc Development 451 987Housing 141 520Total 2 520 440 609 860

From the limited information staff has received regarding the Governor s proposal allfunds other than those committed for debt service obligations would be in jeopardyshould the legislature elect toeliminate redevelopment agencies


7/8

CityCouncilFebruary 8 2011Page 7 of 7

The impacts to the City of such anaction by the State would be significant with728 696 in salary and benefit and administrative costs that would have to be fundedthrough another revenuesourceoreliminated altogether Similarly the City s economicdevelopment activities at a cost of 451 987 would also require analternate fundingsource or face elimination It should be noted that the elimination of theRedevelopment Agency would result in increased General Fund property tax revenuecurrently estimated atbetween 100 000 and 200 000 annuallyAs details regarding the Governor s budget proposal emerge and its E ffects onredevelopment become clearer staff will bring ananalysis of those impacts back to theCity Council with a set of recommendations tominimize any effects that might resultfrom the State s efforts toeliminate the Redevelopment Agency One recommendationcertain to be presented in the event that redevelopment is eliminated is the repaymentof outstanding debts to theCityCEQA REVEW

The Community Development Director has determined that this matter is covered bythe general rule that the California Environmental Quality Act applies only to projectsthat have the potential for causing a significant effectontheenvironment in accordancewith Section 15061 b 3 of the Guidelines The filing of the mid year budget reportand the appropriation of funds asrecommended in the report will not have a significanteffect onthe environment because the action will not result in or lead to a physicalchange in Claremont Therefore noadditional environmental review is needed at thistime

PUBLICNOTICE PROCESS

This item has been noticed through the regular agenda notificationprocess Copies areavailable at the City Hall public counter the Youth Activity Center the AlexanderHughes CommunityCenter theCitywebsite and the Claremont Public LibraryALTERNATIVES TOSTAFFRECOMMENDATION

Inaddition to the staff recommendations therearethe following alternatives1 Request further information from staff2 Takenoaction

Submitted by1city Manager Prepared byJAdamPirrieFinance ManagerAttachment Request forStipend for the Crime Free Multi Housing Coordinator


8/8

ATrACHMENTA

Jeff ParkerFrom JimKeith

Sunday January 30 2011 11 38 PMJeff ParkerBrian Desatnik Aaron Fate Paul Cooper Linda Elderkin SamPedroza Corey Calaycay LarrySchroeder AliceOrtiz Bob Kern CaroleHarter Chris Caenepeel Ed Leavell Evelyn DiazBrown Jerry Klasic JimKeith Judy Wright MaryCaenepeel PatYarborough RoseSorensonSueKeith Tom Andersen Tonya Wagstaff

Subject Request for Stipend forCrimeFreeCoordinator

SentToCc

Aswediscussed after theCity Council meeting onJanuary 25th I amsending you thiswritten request for astipend for theCoordinatorof theClaremont CrimeFree Multi Famly Housing ProgramAs I stated during theCity Council meeting TheCommittee for Safe and Healthy Housing believes that theCoordinator position should becompensated with astipend of 1 000 per month plusalump sumof 1 000tooffset out of pocket costswhileconducting theCrimeFreeProgram for theCity ofClaremont

AliceOrtiz ourCoordinator has beenworking to implement theCrimeFreeProgramsince August 2009 Duringthose 17months she has receivednocompensation for her timeorout of pocket expenses The benefits to thecity during that time period include

Createdthemanual for theClaremontCrimeFree Multi Housing ProgramConducted threesets of training sessions for Claremont apartment managers reachingoneormoremanagers for 13 Claremont apartment communities Together thesemanagers areresponsible for 1 039apartmenthomesHosted aFair Housing TenantWorkshopCoached oneapartment community toachieve full certification in theCrimeFreeMulti Hollsing ProgramIdentified theneed formajor code enforcementeffortsatoneblighted apartment community Worked withClaremont CodeEnforcement Claremont Police newapartmentmanagers and The Committeefor Safeand Healthy Housing toclean upof thisapartment community Progress has beeneffectivl3 using theCrimeFree Lease Addendumtoevict tenants responsible for illegal activity During this time Alicehas responded tocalls comng from theapartmentmanagers sevendays per week

Claremont needs tocontinuethe CrimeFreeProgram training moreapartmentmanagers and their residentscoaching moreapartment communities toachieve fullCrimeFree certification andmaking surethat illegal activitywill bequickly addressedwhen itsurfacesThank you for your consideration

JimKeithChairmanTheCommittee forSafe and Healthy Housing

2010-11 mid-year budget report

Documents