HomeMy WebLinkAbout06 - PH-1 - Adoption of FY 2015-16 Budget - 6/23/2015CITY COUNCIL AGENDA REPORT
MEETING DATE: June 23, 2015
SUBJECT: ADOPTION OF THE FISCAL YEAR 2015-16 BUDGET
ITEM NUMBER: PH -1
DATE: June 16, 2015
FROM: FINANCE DEPARTMENT
PRESENTATION BY: STEPHEN DUNIVENT, INTERIM FINANCE DIRECTOR
FOR FURTHER INFORMATION CONTACT: STEPHEN DUNIVENT, INTERIM FINANCE DIRECTOR,
(714) 754-5243
RECOMMENDED ACTIONS:
1. Approve FY 14-15 Budget Adjustments and transfers included on the Budget
Addendum.
2. Approve Resolution 15- (Attachment 1) adopting the City of Costa Mesa FY 15-
16 Operating and Capital Budget including the Budget Addendum (Attachment 7).
3. Approve partial loan prepayment of $1,500,000 from the Park Development Fees
Fund 208 to the General Fund.
4. Approve partial reimbursement of $400,000 from Fund 218 (Fire System
Developmental Fees) to the General Fund based on the cost of the emergency
vehicle traffic signal pre-emption system ($234,236) and one of the Leader
emergency vehicles (rescue ambulance --$222,385).
5. Approve:
a. Resolution 15- and job descriptions for recommended new CMCEA
positions. (Attachment 8)
b. Resolution 15- and job description for a recommended new CMFMA
position. (Attachment 9)
6. Direct staff to return to Council with recommendations on proposed Fire
Department fees.
BACKGROUND:
The FY 15-16 budget development process officially started on December 11, 2014 with a
kickoff meeting including the CEO, Finance Department Staff and department
representatives. Since that meeting, departments prepared their budget requests and
submitted them to the Finance Department for review. Finance Staff prepared revenue
projections and forecasts, reviewed departmental requests and met with the departments
to discuss their budget requests. These meetings were followed by joint budget hearings
involving the CEO, Finance Department and department representatives. Out of these
discussions and further meetings, a FY 15-16 Operating and Capital Budget was
developed.
1
ANALYSIS:
As a quick overview, Table 1 represents the budget for FY 15-16 for all funds compared
to the FY 14-15 adopted budget:
Table 1
The General Fund provides 89.2% of the total operating budget for all governmental
funds. The total General Fund budget is $113 million, an increase of $3.5 million or 3.2%
from the current year adopted budget.
The FY 2015-16 Operating & Capital Budget in Brief (Attachment 2) contains the City
Chief Executive Officer's Budget Message provides highlights of the financial and budget
policies and how they relate to this budget, a description of the budget preparation and
balancing process, overview charts of the City-wide budget and the General Fund, a brief
financial outlook, budget highlights, a recap of reserves and an overview of capital
improvement projects. It also includes additional summary charts, analysis of changes in
the primary funding sources and expense categories, a brief discussion of internal service
funds, a review of capital improvement project expense trends over the past ten years and
a recap of use of fund balances in certain special funds.
The Summary of Recommended Capital Improvement Projects (Attachment 3) displays
the projects by category and funding source.
The Parks & Recreation Commission reviewed the proposed Capital Improvement
Program on April 23, 2015 and provided a list of recommended changes (additions) to the
capital improvement program; nine projects that total $975,000. Staff will consider how to
fund these projects in future years. A copy of a memo from the Public Services Director
summarizing these items is included as Attachment 4.
The Council discussed the preliminary budget recommendations in a May 12, 2015
Budget Study Session. The follow-up report with additional information and discussion
regarding certain budget adjustments are included as Attachment 5.
A Community Budget meeting was held on May 22, 2015. The CEO, Department heads,
staff and 25 members of the public attended. The CEO and Interim Finance Director
presented an overview of the FY 15-16 Preliminary Operating and Capital Budget. This
presentation was followed by a lengthy question and answer period with a good dialogue
on many issues. Attachment 6 summarizes the general discussion topics, questions and
answers provided during the session.
2
ADOPTED BUDGET - ALL FUNDS
Approprations/
Adopted
Preliminary
Increase (Decrease)
All Funds
FY 14-15
FY 15-16
Amount
Percent
Operating Budget
$ 114,958,461
$ 118,083,807
$ 3,125,346
2.7%
Transfers Out
5,517,067
7,452,140
$ 1,935,073
35.1%
Capital Budget
19,421,001
22,299,929
$ 2,878,928
14.8%
Total
$ 139,896,529
$ 147,835,876
$ 7,939,347
5.7%
The General Fund provides 89.2% of the total operating budget for all governmental
funds. The total General Fund budget is $113 million, an increase of $3.5 million or 3.2%
from the current year adopted budget.
The FY 2015-16 Operating & Capital Budget in Brief (Attachment 2) contains the City
Chief Executive Officer's Budget Message provides highlights of the financial and budget
policies and how they relate to this budget, a description of the budget preparation and
balancing process, overview charts of the City-wide budget and the General Fund, a brief
financial outlook, budget highlights, a recap of reserves and an overview of capital
improvement projects. It also includes additional summary charts, analysis of changes in
the primary funding sources and expense categories, a brief discussion of internal service
funds, a review of capital improvement project expense trends over the past ten years and
a recap of use of fund balances in certain special funds.
The Summary of Recommended Capital Improvement Projects (Attachment 3) displays
the projects by category and funding source.
The Parks & Recreation Commission reviewed the proposed Capital Improvement
Program on April 23, 2015 and provided a list of recommended changes (additions) to the
capital improvement program; nine projects that total $975,000. Staff will consider how to
fund these projects in future years. A copy of a memo from the Public Services Director
summarizing these items is included as Attachment 4.
The Council discussed the preliminary budget recommendations in a May 12, 2015
Budget Study Session. The follow-up report with additional information and discussion
regarding certain budget adjustments are included as Attachment 5.
A Community Budget meeting was held on May 22, 2015. The CEO, Department heads,
staff and 25 members of the public attended. The CEO and Interim Finance Director
presented an overview of the FY 15-16 Preliminary Operating and Capital Budget. This
presentation was followed by a lengthy question and answer period with a good dialogue
on many issues. Attachment 6 summarizes the general discussion topics, questions and
answers provided during the session.
2
The Finance Advisory Committee reviewed the budget recommendations on April 28,
2015 and again on May 26, 2015.
The Budget Addendum (Attachment 7) displays recommended changes to both the
current year budget (due to updated sales tax estimates and to document the changes
associated with the Council approved community meeting room/break room/outdoor
meeting space project) and FY 15-16 Budget changes that were approved after the
budget book printing deadline. The FY 15-16 changes include:
• Correction of cost for Parks & Community Services part-time positions
• Cost of new positions
• Street Cleaning Program reduction
• Updated Sales Tax revenue projection
• Partial advance repayment of the General Fund loan to the Park Development fund
($1,500,000 of the $4,081,005 loan balance) and reimbursement from the Fire
Development Fees Fund ($400,000 based on the cost of the emergency vehicle
traffic signal pre-emption system ($234,236) and one of the Leader emergency
vehicles (rescue ambulance --$222,385)) for use as follows:
o Increase to General Fund reserves ($500,000)
o Police facility generator ($600,000)
o Fire Station 4 ($800,000)
• Allocate $1,900,000 from Park Development Fund (approx. $67,000 would remain
in Park Dev. Fund cash) to have available for projects in cooperation with the
School District pending their review/authorization and community input. Projects
could include turf and lighting at Parsons Field, feasibility study for lights at Kaiser
Elementary, feasibility study for lights at Davis Elementary, etc. Specific funding for
each project would be determined at a later time.
• Purchase of new vehicles to replace vehicles currently being leased
• Other miscellaneous corrections and adjustments
Human Resources provided position job descriptions and recommended salary
resolutions associated with the new position recommendations. These are included for
approval as Attachments 8 & 9.
A final late personnel change was included on the Addendum to upgrade the Video
Production Coordinator to Public Affairs Manager and recruit to fill the Video Production
Coordinator position. This will not result in any addition of full-time staff.
Lastly, new Fire Department service fees are currently being discussed and developed by
staff. These consist of the following:
• Residential apartment inspection fee for buildings with 3 or more units. This would
provide funding related to life safety issues, inspection of converted garages, code
compliance and checking for illegal units.
• Business inspection fee based on square footage and inspection time required.
The fee is related to fire & life safety issues. Restaurant inspections would be
annual while other businesses could be every three years.
• Adopting a policy to seek up to $500 per incident from the property owner's
insurance company. This would be a Fire Department cost recovery fee for
assistance to the property owner and be part of the initial phase of the
3
department's community risk reduction plan. There would be no cost or penalty to
homeowner.
• Fire Station 4 Training Center usage fees charged to other fire departments or
outside users. The funds generated from these fees would help cover the costs to
re -open and maintain the center. The proceeds would be allocated 50% to the Fire
Department and 50% to the City general fund.
Staff seeks Council's direction to return to Council with recommendations on proposed
Fire Department fees.
The next steps in the budget cycle include:
• Fiscal year end closing in the months following June 30, 2015.
• Publish the Adopted FY 15-16 Operating and Capital Budget Book.
• Completion of the Five-year Financial Plan.
• Mid -year Budget Report in February, 2016.
ALTERNATIVES CONSIDERED:
Staff considered many options for the use of funds including requested budget increases
and capital improvement projects. Options were evaluated and assigned priorities. Some
one-time items were approved for accomplishment in the current fiscal year.
Recommended budget amounts are balanced to estimated available resources.
CONCLUSION:
As presented, this represents a balanced budget for the coming fiscal year without the use
of General Fund reserves and provides the highest level of service to the community within
existing financial resources.
Stephen Dunivent Thomas R. Hatch
Interim Finance Director City CEO
Attachments:
1. Budget Resolution
2. FY 2015-16 Operating & Capital Budget in Brief
3. Summary of Recommended Capital Improvement Projects
4. Memo regarding Parks & Recreation recommendations
5. Follow-up Items from the FY 15-16 Council's Budget Study Session
6. Community Budget Presentation Report
7. Budget Addendum
g. Salary resolution and job descriptions for new CMCEA positions
g. Salary resolution and iob description for new CMFMA position
M