Presentation is loading. Please wait.

Presentation is loading. Please wait.

1 FISCAL YEAR 2009-2010 PROPOSED BUDGET City of Costa Mesa Budget Study Session June 9, 2009.

Similar presentations


Presentation on theme: "1 FISCAL YEAR 2009-2010 PROPOSED BUDGET City of Costa Mesa Budget Study Session June 9, 2009."— Presentation transcript:

1 1 FISCAL YEAR PROPOSED BUDGET City of Costa Mesa Budget Study Session June 9, 2009

2 2 BUDGET STUDY SESSION Study Session Agenda: – –Overview of Proposed FY09-10 Budget – –Review Budget Balancing Strategies and progress towards implementation – –Review Service Impacts from Budget Cuts to address Operating Deficit –Questions/comments from City Council

3 3 FY09-10 Proposed Operating and Capital Improvement Budget Represents Managements Recommended Budget to; Represents Managements Recommended Budget to; – Address City Councils priorities within – Existing Financial Constraints to – Fulfill the Service Requirements of the Community.

4 4 Challenges Faced in Developing FY09-10 Proposed Budget Nov. 08 Study Session $8.4m cuts Dec. 08 Budget K/O 5% A.T.B. Feb. 09 Dept. Hearings Addtl. 5% Feb. 09 Mid-Year CSS F.B. to $11m Apr. 09 CSS 10 B.D.S. $19m June 09 Budget Submission FB $14m June 16 Budget Adoption

5 5 Challenges Faced in Developing FY09-10 Proposed Budget Gap between expectations and financial reality has gradually widened over past ten years. Gap between expectations and financial reality has gradually widened over past ten years. –$11.5 added annually in new programs and services over past ten years. –No new revenues to fund growth in services –Coupled with inflationary increases in all other expenditures Coupled with effects of a prolonged severe economic downturn. Coupled with effects of a prolonged severe economic downturn.

6 6 Challenges Faced in Developing FY09-10 Proposed Budget Unlike in prior years where focus was on expanding programs and service, Unlike in prior years where focus was on expanding programs and service, Focus is on scaling back expectations and service levels to level that is supportable within current fiscal constraints. Focus is on scaling back expectations and service levels to level that is supportable within current fiscal constraints.

7 7 Challenges Faced in Developing FY09-10 Proposed Budget Proposed budget represents largest single year reduction in operating costs in Citys history.

8 8 BUDGET SUMMARY All Funds (including transfers) FY Estimated Revenues $ 114,388,526 Utilization of Fund Balance 4,083,237 FY Total Resources 118,471,763 FY Appropriations 118,471,763* *18.38% reduction from FY08-09 Adopted Budget

9 9 TOTAL OPERATING BUDGET All Funds Proposed FY $ 112,064,743 Adopted FY ,440,254 Amount of Decrease $ (16,375,511) Percent of Decrease (12.75 %)

10 10 TOTAL CAPITAL IMPROVEMENT BUDGET - All Funds Proposed FY $ 4,864,020 Adopted FY ,150,477 Amount of Decrease $ (6,286,457) Percent of Decrease (56.38 %)

11 11 CIP FUNDING SOURCE Five-Year Historical Comparison

12 12 TOTAL APPROPRIATIONS All Funds FY Adopted FY Proposed 18.38%

13 13 TOTAL APPROPRIATIONS All Funds Proposed FY $ 118,471,763 Adopted FY ,155,931 Amount of Decrease $ (26,684,168) Percent of Decrease (18.38 %)

14 14 TOTAL APPROPRIATIONS By Fund Type Total $118,471,763

15 15 TOTAL RESOURCES Governmental Funds Only Total $112,306,099

16 16 TOTAL APPROPRIATIONS Governmental Funds Only Total $112,306,099

17 17 DISTRIBUTION OF APPROPRIATIONS By Major Service Category - All Funds Total $118,471,763

18 18 DISTRIBUTION OF APPROPRIATIONS By Major Service Category - All Funds Protection of Persons and Property $ 64,044,034 Community Health and Environment 10,461,781 Transportation 7,779,640 Leisure and Community Services 3,828,593 General Government Support 27,493,695 Capital Improvement Projects 4,864,020 Total $ 118,471,763

19 19 DISTRIBUTION OF APPROPRIATIONS By Major Service Category - All Funds FY08-09 FY09-10 Decrease P.P.P. $ 69,914,263 $ 64,044,034 $ 5,870,229 P.P.P. $ 69,914,263 $ 64,044,034 $ 5,870,229 C.H.E. 12,029,100 10,461,781 1,567,319 Trans. 8,645,280 7,779, ,640 L.C.S. 4,264,567 3,828, ,974 G.G.S. 39,152,242 27,493,695 11,658,547 C.I.P. 11,150,477 4,864,020 6,286,457 Total $ 145,155,931 $ 118,471,763 $26,684,168

20 20 SUMMARY OF APPROPRIATIONS By Major Account – All Funds Total $118,471,763

21 21 DISTRIBUTION OF SALARIES & BENEFITS By Department - All Funds Total $86,408,314

22 22 Total $102,527,549 SUMMARY OF APPROPRIATIONS By Major Account – General Fund

23 23 FY Est. Revenues Transfers In Use of Fund Balance FY Total Resources FY Proposed Budget * $ 96,906, ,0004,828,349 $ 102,527,549 * Includes Transfers Out GENERAL FUND SUMMARY

24 24 GENERAL FUND APPROPRIATIONS Total $102,527,549

25 25 GENERAL FUND APPROPRIATIONS FY Proposed $102,527,549 FY Adopted 118,835,464 Amount Decrease $ 16,307,915 Percent Decrease %

26 26 GENERAL FUND What does the decrease consist of? FY FY FY FY Appropriations Adopted Proposed Decrease Salaries 52,189,622 47,498,772 4,690,850 Overtime 5,184,178 3,303,062 1,881,116 Retirement 15,823,401 15,082, ,500 Debt Service 6,184,401 3,394,616 2,789,785 Internal Rent 4,359,022 2,112,806 2,246,216 Subtotal 83,740,624 71,392,157 12,348,467 Other Accounts35,094,840 31,135,392 3,959,448 Total $118,835,464 $102,527,549 $16,307,915

27 27 TEN YEAR HISTORICAL EXPENDITURES – By Department

28 28 GENERAL FUND RESOURCES Including Transfers In Total $97,699,200

29 29 SALES TAX COLLECTIONS By Business Categories – CY 2008

30 30 SALES & USE TAX General Fund – includes Sales Tax In-Lieu FY Estimated Revenue $ 39,874,000 FY Estimated Revenue 44,167,500* Amount Decrease $ 4,293,500 Percent Decrease (9.72 %) * As revised at Mid Year

31 31 SALES & USE TAX HISTORY General Fund

32 32 PROPERTY TAX General Fund FY Estimated Revenue $ 30,795,000 FY Estimated Revenue 31,285,000* Amount Decrease $ 490,000 Percent Decrease (1.57 %) * As revised at Mid Year

33 33 PROPERTY TAX HISTORY General Fund

34 34 TEN-YEAR REVENUE COMPARISON SALES & PROPERTY TAXES - General Fund

35 35 State Budget Impacts Potential State Takeaways - 8% Reduction CurrentNew FY 08-09FY BudgetedProposed Revenues8%Revenues Property Tax 22,535,0001,802,80022,045,00020,242,200 Property Tax in Lieu of VLF 8,500, ,000 8,750,000 8,070,000 31,035,0002,482,80030,795,00028,312,200 Sales Tax in Lieu of Property Tax (Triple Flip) 10,867, ,400 9,500,000 8,630,600 Total 41,902,5003,352,20040,295,00036,942,800

36 36 FY Fiscal Year End Total Fund Balance FY Ending Fund Balance $ 66.2m Current year estimated change ($ 14.0m) FY Est. Ending F.B. $ 52.2m

37 37 FY Fiscal Year End Reserved $ 15.8 million Reserved $ 15.8 million Unreserved designated $ 29.8 million Unreserved designated $ 29.8 million Unreserved undesignated $ 6.6 million Unreserved undesignated $ 6.6 million FY Ending Fund Balance $ 52.2 million FY Ending Fund Balance $ 52.2 million

38 38 FY Fiscal Year End Fund Balance Reserved – the portion of a governmental funds net assets that is not available for appropriation. Unreserved designated – Managements intended use of available expendable financial resources in governmental funds reflecting actual plans approved by the governments senior management. Designations reflect a governments self-imposed limitations on the use of otherwise available expendable financial resources in governmental funds. Unreserved undesignated – available expendable financial resources in a governmental fund that are not the object of tentative management plans (i.e., designations).

39 39 BUDGET DEVELOPMENT STRATEGIES

40 40 BUDGET DEVELOPMENT STRATEGIES 1.Reduce Departmental Operating Budgets by an additional 5% for an average reduction of 10% by Department from the prior fiscal year which will require the elimination of approximately 23 full-time positions. Estimated Impact:6,318,134

41 41 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Total departmental expenditure reductions amounted to $8.8 million. –Includes both structural as well as one- year reductions. –However, the Proposed Budget does not include any full-time staffing reductions pending results of the PERS Retirement Incentive.

42 42 BUDGET DEVELOPMENT STRATEGIES 2.Negotiate reduction in employee compensation equating to approximately 5% of salary. Estimated Impact: $3,623,663

43 43 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Proposed budget assumes a 5% reduction of base salary and all related appropriations amounting to $3.6 million. –Assumption is based on understanding that negotiations will take place with employee associations during fiscal year to ensure a reduction is made. –If negotiations fail, it will have an impact on current staffing levels or use of G.F. fund balance.

44 44 BUDGET DEVELOPMENT STRATEGIES 3.Reduction of $1 million in non- reimburseable overtime for Police and Fire departments. Estimated Impact: $1 million

45 45 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Proposed budget assumes a reduction in Police dept. overtime of $534,078 and, –Assumes a reduction in Fire dept. overtime of $465,922.

46 46 BUDGET DEVELOPMENT STRATEGIES 4.Negotiated suspension of minimum manning requirements in the Fire Department in order to accomplish the proposed overtime expenditure reduction included in the previous budget development strategy.

47 47 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Currently discussing suspension of minimum manning requirements with the Costa Mesa Firefighters Association.

48 48 BUDGET DEVELOPMENT STRATEGIES 5.Seek Federal Stimulus funding for ten police officer positions to be eliminated due to Police department budget reductions. Estimated Impact: $1,052,010

49 49 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –During the month of April, the City Manager and Police Chief officially transmitted the application for Federal Stimulus funding for Police Officer positions. The application was made for 18 positions with hopes of receiving funding for 10. The City was notified it would receive a response prior to September 30.

50 50 BUDGET DEVELOPMENT STRATEGIES 6.Offer PERS retirement incentive to create vacancies to: (a) reduce the number of personnel that may be laid off as a result of reductions in departmental operating budgets and, (a) reduce the number of personnel that may be laid off as a result of reductions in departmental operating budgets and, (b) create additional vacancies needed for budgetary purposes (assumes total of 50 employees opting to retire of which 25 positions would be eliminated). (b) create additional vacancies needed for budgetary purposes (assumes total of 50 employees opting to retire of which 25 positions would be eliminated). Estimated Impact: $3,485,000

51 51 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Staff is preparing all necessary paperwork for the PERS Retirement Incentive to be acted on and implemented. The estimated window of time for employees to make an election is through September, –No staff reductions included in proposed budget. –Staff will propose budget amendments to reduce expenditures when staff impacts are known.

52 52 BUDGET DEVELOPMENT STRATEGIES 7.Suspension or termination of the Retiree Health Savings (RHS) Plan. (Contributions are comprised of 1% by Employee and 1% by Employer). Estimated Impact: $508,764

53 53 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –RHS plan can be suspended instead of terminated. –Currently conducting discussions to suspend RHS contributions made by both employer and employee. –When staff successfully concludes negotiations, budget will be amended to include expenditure reductions.

54 54 BUDGET DEVELOPMENT STRATEGIES 8.Implement various cost recovery programs including resident EMS fees, inspection fees, and Police and Fire cost reimbursement fees. Estimated Impact: $959,700

55 55 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –At its June 2, 2009, City Council approved some but not all of the fees proposed. The projected shortfall is $809,700. –Additional funding necessary will need to be appropriated from fund balance or, –Additional program and service cuts made to offset the estimated revenue loss.

56 56 BUDGET DEVELOPMENT STRATEGIES 9.Renegotiate/extend the Golf Course Operators agreement for a greater share of the revenues and institute formulaic adjustments to the greens fees. Estimated Impact: $244,850

57 57 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Staff has successfully renegotiated the Operators agreement and it will be considered by City Council at its June 16 meeting. Change in agreement will increase golf revenue to the City by $112,500 annually. Change in agreement will increase golf revenue to the City by $112,500 annually. Also, City will receive one-time payment of $190,000 for adjustment to Golf Course CIP reserve. Also, City will receive one-time payment of $190,000 for adjustment to Golf Course CIP reserve. Total FY09-10 Impact $302,500. Total FY09-10 Impact $302,500.

58 58 BUDGET DEVELOPMENT STRATEGIES 10.Utilization of undesignated unreserved General Fund fund balance. Estimated Impact: $2.9 million

59 59 BUDGET DEVELOPMENT STRATEGIES Implementation Status: Implementation Status: –Proposed budget includes total use of GF fund balance at $4,828,349. –Includes potential savings from PERS retirement incentive and RHS suspension of plan contributions.

60 60 SERVICE IMPACTS AND BUDGET CUTS

61 61 SERVICE IMPACTS AND BUDGET CUTS If substantially approved as submitted the budget development strategies will eliminate over 100,000 man hours. If substantially approved as submitted the budget development strategies will eliminate over 100,000 man hours. Proposed staffing levels will be lower than staffing levels almost 25 years ago. Proposed staffing levels will be lower than staffing levels almost 25 years ago. Staffing reduction will impact both the quality and quantity of service to the public. In many instances, the specific impacts will not be known until after the Retirement Incentive takes full effect. Staffing reduction will impact both the quality and quantity of service to the public. In many instances, the specific impacts will not be known until after the Retirement Incentive takes full effect.

62 62 SERVICE IMPACTS AND BUDGET CUTS Close Downtown Recreation Center pool from October to April. Close Downtown Recreation Center pool from October to April. Elimination of funding for planting of 250 trees, park and open space clean-up crew, weekly median maintenance. Elimination of funding for planting of 250 trees, park and open space clean-up crew, weekly median maintenance. Reduction of public safety staffing (specific impacts will not be known until after the Retirement Incentive takes full effect). Reduction of public safety staffing (specific impacts will not be known until after the Retirement Incentive takes full effect).

63 63 SERVICE IMPACTS AND BUDGET CUTS Elimination of most weekend and after business hour video production programs, Elimination of most weekend and after business hour video production programs, Elimination of paving two residential streets including reduction in use of 750 tons of asphalt in street program, Elimination of paving two residential streets including reduction in use of 750 tons of asphalt in street program, Reduction in Citys ability to respond to knockdowns and unexpected traffic signal repairs, Reduction in Citys ability to respond to knockdowns and unexpected traffic signal repairs,

64 64 SERVICE IMPACTS AND BUDGET CUTS Reduction of right-of-way weed control by 10% resulting in more visible weeds along City streets, alleys and sidewalks, Reduction of right-of-way weed control by 10% resulting in more visible weeds along City streets, alleys and sidewalks, Elimination of all turf and landscape fertilization resulting in a decline in aesthetic quality of parks and landscape and turf healingability in high traffic areas, Elimination of all turf and landscape fertilization resulting in a decline in aesthetic quality of parks and landscape and turf healingability in high traffic areas, Reduction in contract maintenance of TeWinkle Lake, elimination of Mutt Mitt program in all parks, and elimination of routine replacement of park furniture and amenities, Reduction in contract maintenance of TeWinkle Lake, elimination of Mutt Mitt program in all parks, and elimination of routine replacement of park furniture and amenities,

65 65 SERVICE IMPACTS AND BUDGET CUTS Reduction in Youth and Family programs, Mobile Recreation Program, Youth Basketball and Football, Concerts in the Parks, suspension of Youth in Government, Reduction in Youth and Family programs, Mobile Recreation Program, Youth Basketball and Football, Concerts in the Parks, suspension of Youth in Government, Reduced funding for Cultural Arts and Historic Preservation Committees, Reduced funding for Cultural Arts and Historic Preservation Committees, Reduction in staff hours supporting Fairview Park Improvements, Reduction in staff hours supporting Fairview Park Improvements,

66 66 SERVICE IMPACTS AND BUDGET CUTS Reductions in small tools, materials, equipment, supporting Graffiti Removal Program, Reductions in small tools, materials, equipment, supporting Graffiti Removal Program, Suspension of Police Department Recruiting Program, Suspension of Police Department Recruiting Program, Significant reduction in funding for Water Quality inspections, termination of catch basin entrance lid and screen repair/ replacement program, Significant reduction in funding for Water Quality inspections, termination of catch basin entrance lid and screen repair/ replacement program,

67 67 SERVICE IMPACTS AND BUDGET CUTS Reduced Measure M funding for street repairs due to reallocation of General Fund expenditures to the Measure M fund, Reduced Measure M funding for street repairs due to reallocation of General Fund expenditures to the Measure M fund, Postponement of needed computer hardware and software replacement, Postponement of needed computer hardware and software replacement, Elimination of all non-mandatory training and professional development, Elimination of all non-mandatory training and professional development,

68 68 SERVICE IMPACTS AND BUDGET CUTS Postponement of most scheduled vehicle and equipment replacement, Postponement of most scheduled vehicle and equipment replacement, Elimination of Building Repair and Maintenance projects. Elimination of Building Repair and Maintenance projects. –Deferred repairs = Deferred liabilities. –Deferred liabilities = Increased future liabilities.

69 69 Our Future – Moving Forward The current situation is a combination of the recession, reoccurring expenditures exceeding annual revenues, community demands for additional services/capital projects and continuing State budget impacts. The current situation is a combination of the recession, reoccurring expenditures exceeding annual revenues, community demands for additional services/capital projects and continuing State budget impacts. The City cannot control all of these but must address those which it can control. The City cannot control all of these but must address those which it can control. Necessary reductions proposed for FY will fuel future demands for restoration of services, salaries & benefits, deferred maintenance and capital projects. Necessary reductions proposed for FY will fuel future demands for restoration of services, salaries & benefits, deferred maintenance and capital projects. Time to revisit policy directives and financial planning before these demands are upon us. Time to revisit policy directives and financial planning before these demands are upon us.

70 70 FISCAL YEAR PROPOSED BUDGET City of Costa Mesa Budget Study Session Questions?

71 71 FISCAL YEAR 20O PROPOSED BUDGET Copies available for Public Viewing at: Copies available for Public Viewing at: City Clerks Office at 77 Fair Drive City Clerks Office at 77 Fair Drive (City Hall – 1 st Floor) (City Hall – 1 st Floor) Public Libraries at: Public Libraries at: Costa Mesa Branch, 1855 Park Avenue Costa Mesa Branch, 1855 Park Avenue Mesa Verde Branch, 2969 Mesa Verde Drive Mesa Verde Branch, 2969 Mesa Verde Drive Citys Website: Citys Website: Additional information contact Additional information contact

72 72 FISCAL YEAR 20O PROPOSED BUDGET COMMUNITY BUDGET BRIEFING COMMUNITY BUDGET BRIEFING Thursday, June 11, 2009 at 6:00 in Thursday, June 11, 2009 at 6:00 in Conference Room 1A Conference Room 1A PUBLIC HEARING AND ADOPTION PUBLIC HEARING AND ADOPTION Tuesday, June 16, 2009 at 7:00 in Council Chambers Tuesday, June 16, 2009 at 7:00 in Council Chambers

73 73 FISCAL YEAR PROPOSED BUDGET City of Costa Mesa Budget Study Session June 9, 2009


Download ppt "1 FISCAL YEAR 2009-2010 PROPOSED BUDGET City of Costa Mesa Budget Study Session June 9, 2009."

Similar presentations


Ads by Google