HomeMy WebLinkAbout8.2 State Impact to 1992-93 City Budget r
CITY OF DUBLIN
AGENDA STATEMENT
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CITY COUNCIL MEETING DATE: September 14, 1992
SUBJECT: Report on State Budget Impact on 1992-1993 City Budget
(Prepared by: Richard C. Ambrose, City Manager)
EXHIBITS ATTACHED: Summary of Departmental Services Form
RECOMMENDATION: , 4/KReview Proposed Process to Address Impact
FINANCIAL STATEMENT: See Below.
DESCRIPTION:
State Budget
In June 1992, the Dublin City Council adopted a balanced budget for Fiscal
Year 1992-93 . Since the adoption of the City Budget, the State of
California has adopted a State Budget which reduces several sources of
revenue to the City of Dublin. These reductions are outlined below:
Property Tax
SB 844 reduces Cities' property tax in 1992-93 by $200 million. This
results in a loss of property tax in 1992-93 that is equivalent to 9% of
the City's 1991-92 property tax revenues. The State Controller has -
estimated the loss to be approximately $342, 272 to the City of Dublin.
This reduction is a permanent reduction.
SB 617 shifts $40 million in property tax from Cities to the newly created
Educational Revenue Augmentation Fund for 1992-93 only. However, SB 617
also requires that this revenue loss be offset by a shift of Vehicle
License Fees from the State to the Cities. It is anticipated that the
shift will have a $0 impact on the City of Dublin based upon information
provided by the League of California Cities.
Cigarette Tax Revenues
SB 617 shifts all Cigarette Tax money from Cities to the State. In 1991-
92, the City of Dublin received $32, 207 in Cigarette Tax. At the time the
City Council adopted the 1992-93 Budget, no Cigarette Tax was included for
1992-93.
Trailer Coach In-Lieu Tax
SB 617 shifts Trailer Coach-In-Lieu Tax from the Cities to the State. The
estimated loss in 1992-93 is $6,850.
In summary, the State Budget results in a shift of an estimated $381 , 329 in
revenue away from the City of Dublin. Of that amount, the City will be
short $349, 122 in the Fiscal Year 1992-93 Budget as adopted.
Other Impacts
In addition to the loss of revenues identified above, it is likely that the
City will be impacted by increased charges from Alameda County, as a result
of the reduction of County revenues by the State. The impact on the City
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ITEM No. ♦ CITY CLERK
FILE 1-513 O
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of Dublin will not be known until the County takes action to deal with its
shortfall in revenues.
Proposed Action
Prior to taking action to address the loss in revenue, it is proposed that
the Staff prepare a report to the City Council which covers the following
areas.
1 . Operational Savings (without reducing service)
Staff would identify what operational costs could be reduced without
reducing services. This may involve a change in City Policy, work
methods, automation, etc.
2. Potential Reduction in Services
Staff would prepare a comprehensive list of activities/services that
are performed by each City Department and the Fire Department. Staff
would identify potential reductions in service, and the impact of
reduced services. This information would be compiled on the attached
form.
From this comprehensive list, Staff would prepare a list of non-
mandated (discretionary) services. The Council would then prioritize
the list of services. Those services receiving a low ranking would be
evaluated further by Staff to determine the amount of savings that
would be realized by eliminating or reducing the service.
3. Additional Revenues
The City Manager formed a task force consisting of representatives
from all City Departments and DRFA to identify new potential revenue
sources. A report will be presented to the Council identifying those
options which would be feasible.
4. One Time Saving or Cost Deferral
Since the City is nearly three months into the fiscal year, the City
Council may not have the ability to eliminate lower priority services,
or generate certain types of revenue. Therefore, Staff will prepare a
report identifying options which would provide a one time savings for
1992-93 only. These options might function as a "bridge" financing
mechanism until the Council is in a position to delete a program, or
generate revenue in Fiscal Year 1993-94.
Public Input
Once this material has been presented to the City Council, the Council may
wish to set a public hearing to review these issues before taking final
action. The Council may also wish to use the City Newsletter to survey
residents/businesses regarding these proposals. However, the ability to
use the Newsletter for this purpose may be limited by the time available to
impose service reductions that result in the necessary savings.
Recommendation
It is recommended that the Council review the process as proposed above and
provide input as to how the process should be modified, if necessary.
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FORM B
SUMMARY OF DEPARTMENTAL SERVICES
BUDGET ACTIVITY
MANDATE CAN SERVICE BE IDENTIFY
(YES/NO) REDUCED BELOW POTENTIAL IMPACT OF REDUCING
SOURCE OF IMPACT OF NOT CURRENT LEVEL REDUCTIONS SERVICE BELOW
SERVICE MANDATE PROVIDING SERVICE YES NO IN SERVICE CURRENT SERVICE LEVEL
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