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Home My WebLink About03-18-1999 CCg&o3Adopted MinutesRECESS At 8:55 p.m., Mayor Houston called for a short recess. All Councilmembers were present when the meeting reconvened. FISCAL YEAR 1998-99 MID-YEAR BUDGET REPORT & FEBRUARY 1999 MONTHLY REPORT 9:06 p.m.8.2(330-50) Staff Report was presented by Assistant City Manager Paul Rankin. In the 1999-99 Adopted Budget, it was anticipated that General Fund Expenditures combined with Net Fund Transfers In/Out, would exceed General Fund Revenues. Additional Budget Changes or Transfers has been approved since the adoption of the Budget. The revised estimate of the amount to be appropriated from reserves for Fiscal Year 1998-99 has increased to approximately $858,725, as of February 28, 1999. Staff has analyzed the changes to the original Revenue Estimates contained in the 1998-99 Adopted Budget. A revised estimate of Property Tax is a net increase of $125,000. A revised estimate for Taxes Other Than Property is a net increase of $300,000. A revised estimate for Licenses & Permits is a net increase of $50,000. A revised estimate of Intergovernmental Revenues is a net increase of $50,000. A revised estimate for Charges for Services is a net increase of $418,825. Staff anticipates that the 1998-99 General Fund Revenues will exceed the budgeted revenue by approximately $943,825. Staff reviewed expenditures through February 28, 1999 that affect the City’s General Fund. Under General Government, the revised budget estimate is a net increase of $103,460 due to increased activity in Legal Services. Under Community Development, the revised budget estimate is a net increase of $180,000 due to increased activity in Engineering. Under Capital Projects, the revised budget estimate is a net increase of $6,877 due to a consultant study for the Library project, Shannon Park Pedestrian Pathway Project, and San Ramon Road Slope Stabilization Project. The projections listed do not include the $12,129,022 transfer made from the General Fund to pay off the remaining balance due on the 1993 COPs on February 1, 1999. There may be several Capital Projects carry-overs to next year. They include (1) Development Services Data processing/Permit System & GIS Phase I; (2) CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING March 18, 1999 PAGE 183 Communications System Upgrade; ( 3) Fire Apparatus; and (4) Document Storage & Retrieval for a total of approximately $634,800. Overall there is still a deficit of $250,000 with expenditures expecting to exceed revenues in Fiscal Year 1998-99. Cm. Zika asked if the City was anticipating any revenue from the large auto dealers in east Dublin? Mr. Rankin responded there would only be sales tax from January, February, and March. On motion of Cm. Zika, seconded by Cm. McCormick, and by unanimous vote, the Council approved the budget change forms and received the report. 1999-2000 BUDGET STUDY SESSION 9:13 p.m.8.3(330-20) City Manager Richard Ambrose presented the Staff Report. He indicated that the City’s Annual Budget Study Session provided the City Council with an opportunity to identify those programs, services, and projects the Council would like Staff to analyze as part of the development of the City’s Annual Operating Budget and Five-Year Capital Improvement Program for the upcoming year. The Budget Study Session also serves as a means of providing the Council with early information regarding those items that may have a significant impact (positive or negative) on the City’s expenditures and revenues in 1999-2000. REVENUES Barring another major slump in auto sales (which the City experienced between Fiscal Years 1991 and 1994), it is anticipated that the City will experience some modest growth in sales tax from the retail businesses in Hacienda Crossings and AutoNation during the upcoming year. The City will only collect 65% of the 1% sales tax generated from Hacienda Crossings and AutoNation due to the agreement made with Alameda County. Another potential impact on local sales taxes is the ever increasing number of untaxable transactions being made over the Internet. CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING March 18, 1999 PAGE 184 The addition of AmeriSuites and Holiday Inn Express for a full year and possibly Extended Stay Hotel should increase the City’s Hotel Transient Occupancy Tax. A preliminary prediction is an increase of $150,000 to $200,000. The estimated lost interest income from the City expending $12.1 million from Reserves to defease the Civic Center COPs and the drop in interest rates is estimated at approximately $635,000. This could be offset somewhat by growth of the City’s Reserves at the end of Fiscal Year 1997-98 for a preliminary prediction of a decrease of $540,000. OPERATING EXPENDITURES As a result of paying off the Civic Center COPs, the City has eliminated its lease payment for Fiscal Year 1999-2000 for a preliminary predicted saving of $1.6 million. The full year impact of additional Library hours will be an increased cost of approximately $30,000. Staff has been working on a staffing plan for next Fiscal Year which will be completed once the Council has identified its highest priority objectives. The cost of increased Staff will then be determined. The above expenditures do not include inflationary increases for purchase of materials, supplies, and equipment, nor increased cost of wages and benefits for current City employees or other contract service providers. CAPITAL EXPENDITURES The City Council adopted a new Five-Year Capital Improvement Program which included approximately $49,740,555 in unfunded projects. They were I-580/Fallon Road Freeway Interchange; St. Patrick Way (Regional Street to Golden Gate Drive); Dublin Boulevard Improvements (Sierra Court to Dougherty Road); Dougherty Road Improvements (Houston Place to I-580); Dougherty Road Improvements (Amador Valley Boulevard north to City Limits); Scarlett Drive/Iron Horse Trail Extensions; and Tri- Valley Transportation Development Fee Regional Transportation Projects. A portion of these projects will not be funded entirely by development impact fees. Staff has undertaken an analysis of the equipment, system, etc which needs to be evaluated for Y2K compliance. Once this analysis is completed, additional funds will be required to correct any deficiencies. CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING March 18, 1999 PAGE 185 Council gave Staff the following direction regarding Operating Expenditures, Capital Expenditures, and Contract Services. Operating Expenditures 1A.Should the 1998-99 level of service adopted by the City Council as part of the 1998-99 Adopted Budget for each program area be used as the base level of service in developing the Fiscal Year 1999-2000 Budget? Yes – by a consensus. 1B.To the extent that the City Council’s 1999 objectives require additional resources not available in the current budget, should the cost of funding only high priority objectives be identified as an additional budget increment? Yes – by a consensus. 1C.If there is an additional service/program which was not identified in the 1999 Goals & Objectives Study Session, which you would like evaluated during the development of the 1999-2000 budget, please identify. Mayor Houston requested computers for the School District be added. 1D.During Fiscal Year 1997-98, the City Council funded a number of community groups. For each community group identified, please identify whether the community groups level of funding should be the same level as Fiscal Year 1998-99 and included in the base level or in an additional level of service in Fiscal Year 1999-2000. The Council determined that Community Television Operational Subsidy was the only community group from last year that would be included in the base level. All other community groups would have to make a new request for funding for the Fiscal Year 1999-2000. The community groups from last year included Dublin Substance Abuse Council for Red Ribbon Week and Dry Grad Night; Parent Education Program; Dublin Fire Arts Foundation Organizational subsidy; Childcare Links Childcare Support; Tri-Valley Convention & Visitors Bureau, and Dublin Partners in Education. CAPITAL EXPENDITURES 2A.Are there additional Capital Projects which are not included in the adopted Five- Year Capital Improvement Program which you would like to see Staff evaluate? Vice Mayor Lockhart requested computers for Council Offices be added. CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING March 18, 1999 PAGE 186 2B.Of those projects currently identified in the Five-Year Capital Improvement Program, which projects would you like to see evaluated for funding in Fiscal Year 1999-2000? Vice Mayor Lockhart requested that Iron Horse Trail be funded sooner than listed in the CIP. Mayor Houston requested Dublin El Fields. 2C.In the 1998-99 Budget, a total of $3,026,357 was allocated from the General Fund for Capital Projects. If funding is necessary for Operating Expenditures in 1999- 2000, three alternatives (1) defer 1999-2000 Capital Projects to a later year; (2) utilize Unallocated Reserves; or (3) utilize Debt Financing were given to the Council as options for funding Capital Projects in 1999-2000. Mayor Houston indicated his first choice was #1 to defer projects, but he would like it to be determined on a project by project basis. Some projects may rise to the top in need to be completed. The Council chose to defer 1999-2000 Capital Projects to a later year with Cm. Zika also supporting utilizing Unallocated Reserves if necessary. But all Councilmembers rejected the option of utilizing Debt Financing. RESERVES Currently funds are not reserved for future costs associated with (a) retiree medical; (b) future renovation of existing buildings; (c) catastrophic losses such as property damage protection due to earthquake; (d) unfunded future Capital Projects; and (e) on- going liability for Dougherty Regional Fire Authority. Mr. Ambrose explained the City was self-insured and has reserves for claims we know about. The City of Dublin shares liability of DRFA employees with the City of San Ramon. Mayor Houston asked if the longer time goes on if there is less risk? Mr. Ambrose responded that retiring medical was on-going. The City also inherited some former DSRSD retirees. We have not set aside a reserve for it. There is a reserve of a quarter of a million dollars for known claims. CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING March 18, 1999 PAGE 187 Cm. Zika wanted Staff to look at what reserves there are and set-up a plan for the future. Mayor Houston asked about the City’s policy for replacing major items. What are our reserves? 3A.Should the City Council policy on Reserves be modified? No – by a consensus. Mayor Houston stated the policy did not need to be modified today but by next year he would want a policy on replacing major items and also know what reserves we really have. Mayor Houston explained question 3B was asking whether the City should use our reserves for Operating Expenses. He indicated if we don’t want to use reserves, we would be looking at reduction in services as we did in 1992-93. Mr. Ambrose responded that is only if revenues dropped below ability to provide operations. Vice Mayor Lockhart felt that would not be a healthy thing to do. 3B.Should use of Reserves be used for Operating Expenses? No – by a consensus. CONTRACT SERVICES Building & Safety (Linhart Petersen Powers & Associates); Animal Shelter Services (Alameda County); Crossing Guards (All City Management); and Public Works Maintenance (MCE) are due to be evaluated this Fiscal Year. By consensus, the Council requested Staff to evaluate the cost of providing the service only for Fiscal Year 1999-2000. BUDGET CALENDAR The City Council chose June 24, 1999 at 6 p.m. for the Annual Budget and Five-Year Capital Improvement Program public hearings. CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING March 18, 1999 PAGE 188 The Planning Commission will review the CIP on June 8th or June 22na. The Planning Commission has to review the CIP to see if the projects are in compliance with the City's General Plan. Council requested that sandwiches be provided before the Budget meeting. ADJOURNMENT 11.1 There being no further business to come before the Council, the meeting was adjourned at 9:40 p.m. Minutes prepared by Sandie Hart, Secretary.. ^rr s,: s ~_ ~i~'-Cl~xrk Mayor CITY COUNCIL MINUTES VOLUME 18 ADJOURNED REGULAR MEETING Marc~ 18, ~999 PAG£ 189