HomeMy WebLinkAbout4.04 Appropriations Limit
STAFF REPORT CITY CLERK
File #330-20
CITY COUNCIL
DATE:June 19, 2012
TO:
Honorable Mayor and City Councilmembers
FROM:
Joni Pattillo, City Manager
SUBJECT:
Adoption of an Appropriations Limit for Fiscal Year 2012-2013
Prepared by Paul S. Rankin, Administrative Services Director
EXECUTIVE SUMMARY:
Each year the City Council is required by State Law to adopt an Appropriations Limit (Limit) in
conjunction with the Budget process. The Fiscal Year 2012-2013 Appropriations Limit is
calculated by multiplying the adopted Limit for the prior year by a set of factors to create a new
limit. The Appropriations Limit for Fiscal Year 2012-2013 exceeds, by a significant amount, the
appropriations which are subject to the Limit.
FINANCIAL IMPACT:
The proposed Limit for Fiscal Year 2012-2013 is $200,919,750 and only $40,088,269 of the total
City appropriations for Fiscal Year 2012-2013 are subject to this Limit.
RECOMMENDATION:
Staff recommends that the City Council adopt the Resolution adopting an Appropriation Limit for
Fiscal Year 2012-2013 of $200,919,750.
Submitted By Reviewed By
Administrative Services Director Assistant City Manager
DESCRIPTION:
Each year the City Council is required by State Law to adopt an Appropriations Limit (Limit) in
conjunction with the Budget process. The Fiscal Year 2012-2013 Appropriations Limit is
calculated by multiplying the adopted Limit for the prior year by factors reflecting economic
changes over the prior year.
ITEM NO. 4.4
Page 1 of 2
Description of Appropriations Limit
The laws regulating the application of the Limit forbid an agency from appropriating specific
funds that would exceed the Limit. The restriction applies to appropriating monies categorized
as “Proceeds of Taxes.” The Limit carries forward each year and is subject to an adjustment in
accordance with a specified formula. As part of the annual audit procedures, the City’s
independent Auditors also review the calculation and report any findings.
Each government entity is required to calculate a Limit and include it as part of the Annual
Budget. This Limit may also be referred to as the Gann Limit or Proposition 4 Limit. The City
has complied with this requirement. The City has also posted the availability of the changes
prior to adoption. The adjustment is made annually and is based on a formula which may
include the following factors (the City has the discretion to choose one factor from each category
below):
CATEGORY A – CHANGE IN POPULATION
Change in City population; or
Change in population for the entire County;
CATEGORY B – CHANGE IN STATE INCOME or LOCAL NON-RESIDENTIAL VALUATION
Change in State Per Capita income; or
Change in non-residential assessed valuation.
2012-2013 Proposed Appropriations Limit
Staff has prepared the calculations necessary to adopt the Limit for Fiscal Year 2012-2013 in
accordance with State Law and with the Uniform Guidelines of the League of California Cities.
The discretionary factors selected in calculating the FY 2012-2013 Limit are: (1) Change in the
City of Dublin population; and (2) Change in State Per Capita Income.
The new Fiscal Year 2012-2013 Appropriations Limit as calculated and attached to the
proposed Resolution is $200,919,750, based upon an increased adjustment factor of 6.26%
which is applied to the 2011-2012 Limit. The Preliminary Fiscal Year 2012-2013 Budget
includes appropriations subject to the Limit totaling $40,088,269 that would be categorized as
“Proceeds of Taxes”. Therefore, the appropriations subject to the Appropriations Limit are
below the allowed amount by $160,831,481.
Although the City is well below its allowed Limit, it is important to make revisions in a timely
manner. For record keeping purposes, the Limit carries forward each Fiscal Year. The City
must also adopt a Limit prior to the beginning of the Fiscal Year, in accordance with State Law.
Staff has prepared a Resolution (Attachment 1) that will adopt an Appropriations Limit for Fiscal
Year 2012-2013.
NOTICING REQUIREMENTS/PUBLIC OUTREACH:
On June 1, 2012 a Public Notice was posted stating that the factors used in calculating the
Appropriations Limit were available for public review; the notice was also displayed on the City
website. The information was also contained in the Preliminary Budget and Financial Plan for
Fiscal Years 2012-2013 and 2013-2014.
ATTACHMENTS:
1. Resolution adopting an Appropriations Limit for Fiscal Year 2012-
2013 of $200,919,750
Page 2 of 2
RESOLUTION NO. _______
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN
***************************
ADOPTING AN APPROPRIATIONS LIMIT FOR FISCAL YEAR 2012-2013 OF $200,919,750
WHEREAS
, State law requires that an Appropriations Limit be adopted by the City
Council in conjunction with the Annual Budget process; and
WHEREAS
, Article XIII B of the California Constitution places certain restrictions on
appropriations made by cities; and
WHEREAS
, the restrictions are applicable to appropriations, which meet the definition of
a "Proceeds of Taxes"; and
WHEREAS
, the law allows the option to select the factors to be used in the calculation of
the Appropriations Limit; and
WHEREAS
, for one of the adjustment factors the City must select between: (A) the
change in City population, or (B) Countywide population, and the City has selected the Change
in City population; and
WHEREAS
, for the second adjustment factor the City must select between: (1) the
change in the State per capita income, or, (2) the change in the assessed valuation of local non-
residential construction, and the City has selected the change in State per capita income; and
WHEREAS
, the calculation of the Appropriations Limit for Fiscal Year 2012-2013 is
described in Exhibit A, attached hereto and by reference made a part hereof.
NOW, THEREFORE, BE IT RESOLVED
that the City Council of the City of Dublin does
hereby adopt the Fiscal Year 2012-2013 City of Dublin Appropriations Limit as $200,919,750.
BE IT FURTHER RESOLVED
that the limit has been calculated in accordance with State
Law and is shown in Exhibit A, attached hereto.
th
PASSED, APPROVED AND ADOPTED
this 19 day of June, 2012.
AYES
:
NOES
:
ABSENT
:
________________________________
ATTEST
: Mayor
_____________________________
City Clerk
EXHIBIT A
CALCULATION OF FISCAL YEAR 2012-2013 APPROPRIATIONS LIMIT
(Based on Fiscal Year 2011-2012 Limit)
A. Selection of Optional Factors
1. Change in Population – City vs. County.
Factors 1/1/2011 1/1/2012 % Increase
a. City of Dublin 43,838 44,891 2.40%
b. County of Alameda 1,528,914 1,514,014 0.98%
The City selected Factor 1a. City of Dublin population growth 2.40%
2. Change in State per Capita Personal Income vs. City Non Residential Building
Construction.
Factors % Change
a. Change in State per Capita Personal Income 3.77%
b. Change in Non Residential Assessed Valuation 2.00%
The City selected Factor 2a. Change in State per capita personal income 3.77%
B. FY2012-2013 Growth Adjustment Factor
1.0626
Calculation of factor for FY2012-2013 = X* Y = 1.0240*1.0377=
X = Selected Factor #1 + 100 = 2.40+100 = 1.0240
100 100
Y = Selected Factor #2 + 100 =3.77+100 = 1.0377
100 100
C. Calculation of Appropriations Limit
Fiscal Year 2011-2012 Appropriations Limit $189,083,145
1.0626
Fiscal Year 2012-2013 Adjustment Factor x___
Fiscal Year 2012-2013 Appropriations Limit $200,919,750
Exhibit A