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CC 2015-06-09_08c FY 2014-15 Appropriation LimitTO: FROM: SUBJECT: DATE: MEMORANDUM CITY COUNCIL DEBBIE MALICOAT, DIRECTOR OF ADMINISTRATIVE~ SERVICES vi· CONSIDERATION OF FISCAL YEAR 2014-15 APPROPRIATION LIMIT JUNE 9, 2015 RECOMMENDATION: It is recommended the City Council adopt the att~ched _Resolution establishing the appropriation limit from tax proceeds for Fiscal Year 2015-16. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There are no fiscal or personnel impacts. BACKGROUND: Annually, the City is required to calculate the expenditure appropriation limit from tax p~oceeds to determine compliance with Propositions 4 (Gann_ Initiative) and 111 (Spending Limitation Act of 1990). This calculation is based on the previous year's ap'propriation limit ($18,605,951) multiplied by the per capita personal income percentage increase (3.82%) and multiplied again by the population percentage change (0.77%). The State Department of Finance provides both the population change and the per capita personal income change for the previous fiscal year. ANALYSIS OF ISSUES: The City is responsible for dividing citywide revenues between tax and non-tax revenue and applying the formula to the cumulative appropriation limit. For Fiscal Year 2015-16, the appropriation limit has been calculated to be $19,465,437. This calculation means that the City cannot receive more than $19,465,437 in tax-based revenues in Fiscal Year 2015-16. The estimated tax-based revenues for the Fiscal Year have been calculated to be $13,982,850, approximately $5.5 million less than the appropriation limit. Therefore; the City is in compliance with Article XlllB of the California Constitution. Item 8.c. - Page 1 CITY COUNCIL CONSIDERATION OF FISCAL YEAR 2013-14 APPROPRIATION LIMIT JUNE 9, 2015 PAGE2 ALTERNATIVES: The following alternatives are provided for City Council consideration: -Adopt the Resolution establishing the appropriation limit for Fiscal Year 2015-16; -Do not adopt th,e .Resolutio_n; -Provide direction to staff. ADVANTAGES: By adopting the Resolution establishing the appropriation limit for Fiscal Year 2015-16, the City will be in compliance with Propositions 4 and 111. DISADVANTAGES: There is no disadvantage identified in relation to this recommendation. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted in front of City Hall on Thursday, June 4, 2015. The Agenda and report were posted on the City's website on Friday, June. q, 2015. No public comments were received. · · Item 8.c. - Page 2 RESOLUTION NO. · A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE ADOPTING A TAX~ PROCEEDS EXPENDITURE APPROPRIATION LIMli FOR F-ISCAL YEAR 2015-16 WHEREAS, Sections 7900 et seq. of the Government Code provide for the effective and efficient implementation of Article XlllB of the California Constitution; and WHEREAS, Government Code Sections 7901 through 7914 provide that each year, the go~erning body of each local jurisdiction shall, .by resolution adopted at a regularly scheduled meeting, establish the annual adjustment factors to be used and the tax proceeds expenditure appropriation limit. NOW,· THEREFORE BE IT RESOLVED, by· the City Council of the City of Arroyo Gran.de as follows: 1. The California per.capita income and the population of.San Luis Obispo County, California are recognized as the annual adjustment factors for Fiscal Year 2015- 16. 2. The appropriation limit for Fiscal Year 2015-16 is hereby set at nineteen million, four hundred sixty-five thousand, and four hundred· thirty seven dollars ($19,465,437). 3. Documentation used in the determination of the tax proceeds expenditure appropriation limit is atta.ched hereto as Exhibit A and incorporated herein by this reference. 4. This Resolution is effective on its date of adoption. On motion of Council Member , seconded by Council Member , and on the following roll call vote, to wit: AYES: NOES: ABSENT: the foregoing Resolution was passed and adopted this day of ,2015. Item 8.c. - Page 3 RESOLUTION NO. PAGE2 JIM HILL, MAYOR ATTEST: KELLY WETMORE, CITY CLERK APPROVED AS TO CONTENT: -ROBERT MCFALL, INTERIM CITY MANAGER APPROVED AS TO FORM: HEATHER WHITHAM, CITY ATTORNEY Item 8.c. - Page 4 CITY OF ARROYO GRANDE CALCULATION OF APPROPRIATION LIMIT FROM TAX PROCEEDS FOR FISCAL YEAR 2015-16 Appropriation limit for 2014-15 Multiplied by the appropriation limit change factors: Per Capita Personal Income Change: 3.82% Conversion to ratio: Population Change: 2014 17,295 2015 17,428 Change 133 Conversion to ratio: 133 17,428 APPROPRIATION LIMIT FOR FISCAL YEAR 2015-16 ESTIMATED 2015-16 PROCEEDS OF TAXES SUBJECT TO APPROPRIATION LIMIT Amount under/( over) limit 3.82% + 100 100 0.77% .77 + 100 100 Exhibit A $ 18,605,951 1.0382 1.00770 $ 19,465,437 $ 13,982,850 $ 5,482,587 Item 8.c. - Page 5 THIS PAGE INTENTIONALLY LEFT BLANK Item 8.c. - Page 6