1. Larkspur City Council Strategic Planning Workshop City Financial Picture February 1, 2014

2. Larkspur Financial Picture February 1, 2014____________________ City’s financial picture is a tale of the Good, the Bad, and the Ugly 2

3. Larkspur Financial Picture February 1, 2014____________________ THE GOOD We have a balanced budget. We have reserves in excess of the amount required by our policies. All major revenue sources are trending upward. We eliminated the CalPERS side fund. We implemented Pension Reform Measures and Employee Cost Sharing of Medical Benefits. 3

4. Larkspur Financial Picture February 1, 2014____________________ THE GOOD We are saving money through shared services. Measure C passed! Refuse Vehicle Impact Fee implemented with almost no public comment. Rose Lane development is bringing infusion of one-time monies. Marin Country Mart, Bon Air Center, and Larkspur Landing all doing quite well. 4

5. Larkspur Financial Picture February 1, 2014____________________ THE BAD The State continues to take local money and control. Payroll costs are increasing annually at a significant rate. Growth in Property Tax is modest. North Magnolia struggling. New storm water regulations are a major cost burden to implement and enforce. 5

6. Larkspur Financial Picture February 1, 2014____________________ THE UGLY City has significant OPEB Liability – will likely climb to $10M – and no money in trust. City has balanced budget by deferring maintenance and infrastructure investment. City does not have capital sinking funds. City’s long-range capital project list will cost anywhere from $50-100M. 6

7. Larkspur Financial Picture February 1, 2014____________________ Our deferred maintenance and infrastructure investments are similar to carrying a large credit card balance and only making the minimum payment. 7

8. Larkspur Financial Picture February 1, 2014____________________ We have stayed in the black by deferring many costs and because growth in our property tax base outpaced increases in payroll costs. When economy was doing well, property tax grew 7%+ several times. Even during low points in the economy, we enjoyed property tax growth. While sales tax took a big hit in the down economy, we have a very stable base that weathered the storm. 8

9. Larkspur Financial Picture February 1, 2014____________________ 9

10. Current fiscal year revenues are up. One-time fee revenue from the Rose Lane project is a major source of this revenue. Transient Occupancy Tax remains stable and strong. Sales tax is trending upward. There will be a lot of pressure to spend these newfound gains. But… 10

11. Larkspur Financial Picture February 1, 2014____________________ We need to cut our credit cards: Establish and fund an OPEB trust. Fund our capital sinking funds. Invest in our infrastructure. And we cannot add services to the General Fund. 11

12. Larkspur Financial Picture February 1, 2014____________________ What is Economic Development? Word Cloud for Cottonwood Heights, UT 12

13. Larkspur Financial Picture February 1, 2014____________________ What is Economic Development in Larkspur? We need to define economic development so that we have a lens through which we can examine everything we do. We need to have a conversation with the community about how to facilitate economic growth while preserving quality of life. 13

14. Larkspur Financial Picture February 1, 2014____________________ Other Conversations for 2014 How much subsidy should we provide in our fee schedule? How do we encourage private support of the City? How do we handle the Community Facility Parcel in light of our challenges? 14

15. Larkspur Financial Picture February 1, 2014____________________ 15