HomeMy WebLinkAbout32 - PH-2 - Attachment 4 - 6/15/2021Date: June 09, 2021
To: Costa Mesa City Council
Copy: Lori Ann Farrell Harrison – City Manager, Carol Molina – Finance Director, Raja
Sethuraman – Public Services Director
From: Finance and Pension Advisory Committee (FiPAC)
Subject: Fiscal Year 21/22 Preliminary Budget
___________________________________________________________________
Staff reviewed the Preliminary Budget with FiPAC and our Budget Subcommittee took a
deeper review and listened to the various Budget Study Sessions. The entire
Committee received a review of the “Revised Proposed” Budget from Staff on June 9th.
The full Committee voted unanimously to approve this recommendation letter on June
9th.
We thank the Finance Dept. and entire Staff for their efforts in compiling the Preliminary
Budget.
Over the course of this Budget review cycle alternatives for adjusting the Preliminary
Budget and Staffing Levels were presented by Staff. This letter refers to both the
original Preliminary Budget and the alternatives that were presented to Council on June
8th and to FiPAC on June 9th.
The Preliminary Budget includes funding for recovery and growth and FiPAC supports
both, but we also believe, when necessary, growth has to be tempered by affordability.
To coin a phrase from the City Manager, we were concerned the Preliminary Budget
was “building back too soon”.
Summary
1 The Revised Proposed Budget resolves our two primary budget concerns.
2 FiPAC supports the Revised Proposed Budget spending level of $151.6M.
3 FiPAC concurs with the decision to eliminate the use Declared Disaster
Reserves.
4 We concur with Staff that a Five-Year Forecast needs to be completed. This
prudent planning tool is integral in helping the City meet one of the strategic
goals to “achieve long-term fiscal sustainability”.
5 FiPAC recommends a full-time staffing level of 529.
6 To help achieve the “infrastructure” Strategic Goal we recommend additional
collaboration between Council and Staff in the development of Capital plans.
ATTACHMENT 4
Budget
FiPAC supports the Revised Proposed Budget expenditure amount of $151.6M.
This is $2.8M less than the amount in the Preliminary Budget. The $151.6M is
comprised of recurring revenue of $144.6M and ARP funding of $7.0M
We support the full use of ARP funding, but after this funding is fully used,
recurring revenue must be sufficient to sustain the existing level of expenditures.
Use of Fund Balance (Reserves)
We concur with the proposed alternate which eliminates the use of Reserves.
We did not support the use of Declared Disaster Reserves in the Preliminary
Budget.
Staffing
FiPAC supports a full-time headcount of 529. This is one less than the 530
number included in the Preliminary Budget. We recommend deferring a decision
on the “Arts Specialist” position, at least until the Midyear Review. This position
is funded with Measure Q sales tax revenue which will not start being received
until later in FY 21/22.
The 529 full-time headcount represents a 17 headcount increase from the current
approved level of 512. We recognize this is a sizeable increase but the
increased cost is mitigated by the fact that the FTE increase is about half the 17
at 9.94 and this cost is budgeted within the Revised Proposed Budget.
Capital
We recommend additional collaboration between Council and Staff in the
selection and prioritizing of Capital projects for both the annual and five-year
Capital Improvement Programs. We believe this will help Council and Staff be
better aligned as they work toward the Strategic Goal of “maintaining and
enhancing” all components of the City’s infrastructure.
Referring to the Capital section in the Preliminary Budget book (pp 254 – 256):
within Parks we recommend a subcategory titled “Fairview Park” be added for
Fairview Park projects and within Transportation adding a subcategory titled
“Active Transportation” for Active Transportation projects. Public and Council
interest in these two subjects merit each being highlighted, in fact they are
important enough for each to have their own citizens committee.
We heartily support Councilwoman Reynolds request that an online “Capital
Status Report” be created for the public to access. The public is very interested
in City projects, especially those in their Council district and/or projects they are
passionate about.
Thank you and FiPAC is available to answer any questions.
_____________________
Ralph Taboada
Chair - Finance and Pension Advisory Committee
Committee members: Tom Arnold – Vice Chair, Lisa Buchanan, Philip
D’Agostino, Gabriel Godinez, Boris Gresley, Kip Hancock, Wendy Leece