1. City Council Meeting October 17, 2016 Item 10
Mid-year General Fund Budget Reductions and Discussion of Potential Future Budget Actions
City Council Meeting October 17, 2016
Item 10

2. Outline for this evening
Discuss current position of the General Fund
Based on updated Five Year Forecast
Consider proposed General Fund reductions
Totaling $2.1 million
Elimination of 7.0 Full-Time Equivalents
Shift in expenditures to non-general funds
Outline framework for potential future budget actions
Phased approach

3. 5-Year Forecast - June 2016

4. 5-Year Forecast – October 2016

5. Fiscal Year 2016 – One Time Revenue
Property Tax (Boomerang Funds from FOC Payment)
$ 2,300,000
Administrative Fee Lawsuit Settlement
1,100,000
Triple Flip Unwinding
2,000,000
Insurance Claim – General Fund Reimbursement
403,000
Investment Settlement
100,000
Deposit Write-Off
372,000
Grant revenue receipt s/b accrued to FY15
1,102,000
$ 7,377,000

6. Unfunded Pension Liability

7. Fund Balance
$47m Reserve Target

8. General Fund Forecast

9. Recommended FY 2017 Mid-Year Budget Reductions
Department
Description
FTEs
Amount
City Manager's Office
Eliminate Project Manager
1.00
$ ,546
Eliminate Public Information Coordinator
$ ,332
Finance
Eliminate Management Analyst II
$ ,405
Public Works
Reallocate a portion of Engineering cost to CIP
$ ,980
Reduced water cost from conservation
$ ,000
Service and supply reductions
$ ,000
Eliminate Maintenance Assistant in Parks Division
$ ,015
Reduce overtime budget
$ ,097
Planning
Reallocate personnel costs to Building Services Fund
$ ,377
Eliminate Management Analyst IV (50% General Fund/50% Building Fund)
$ ,354
Transportation
Reallocate costs to various parking funds
$ ,999
Eliminate Transportation Administrator (50% General Fund/50% various Parking Funds)
$ ,976
Human Services & Recreation
$ ,976
TOTAL
7.00
$ 2,113,057

10. General Fund Expenditures

11. 5-Year Forecast – with Proposed Reductions

12. Addressing Financial Challenges
Revenues
Modification to TOT sharing arrangement with PCOC
Annual cap on total contribution
Complete a comprehensive cost of service study
Ensure City is recovering full cost recovery
Complete a cost allocation plan
Allocation of costs between funds
Explore other opportunities to increase revenue recovery
Possibility consider some sort of revenue measure

13. Addressing Financial Challenges
Further expenditure reductions
Will not be easy
But are necessary to ensure a balanced budget
Will likely result in service reductions
As a result of prior recession-related reductions
Will be recommended after program analysis
First round getting underway presently
Will take time and should be done methodically
Adjusting as necessary along the way

14. Addressing Financial Challenges
Create opportunities for public engagement
Host a series of public meetings to discuss the budget
Special budget issue of In Focus
Return to City Council with additional information and specific recommendations as appropriate

16. CalPERS Investment Returns

17. CalPERS Investment Returns
History of CalPERS Geometric Mean
Rates of Return and Volatilities
1 Year
5 Year
10 Year
20 Year
30 Year
Geometric Return
2.4%
10.7%
6.1%
7.7%
9.1%
Volatility -
9.4%
14.0%
11.8%
10.5%

18. Library Funding City Population Facilities FTE FY16 Appropriations
in Millions of $
Thousand Oaks
129,349 2
69.00
$8.3
Pasadena
141,510 10
104.95
$14.1
Torrance
148,427 6
74.00
$7.7
Ontario
168,777
50.00
$4.9
Rancho Cucamonga
174,064
51.00
$5.0
Glendale
199,182 7
69.78
$11.0
Anaheim
351,433
92.79
$10.5

19. 5-Year Forecast – August 2016