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CC 2016-06-14_12b Budget Update PresentationBudget Update Report June 14, 2016 1 Update revenue projections using the latest data Recommend adjustments to expenditures as appropriate Provide direction for second year of Biennial Budget Purpose 2 General Fund expenditures are expected to exceed revenues, as previously projected Fund balance remains in excess of minimum policy As we experience economic improvement, many challenges remain. We are continuing to gather data that will allow the Council to make well informed decisions in the next two-year budget plan. Summary 3 Citywide expenditures FY 2015-16 = $45.4 Million (includes CIP carryovers) Citywide expenditures FY 2016-17 = $42.5 Million Citywide Budget 4 Citywide Revenues $41.6M 5 Citywide Expenditures $42.5M 6 Property tax increases by 4.25% or $175,000 Sales & Use tax increases by 4% or $139,700 (after triple flip impacts) TOT increases by 3.5% or $33,600 No changes assumed for fee studies yet FCFA costs are based on FCFA Preliminary Budget Salary/benefit costs – contractually obligated amounts or 2.5% increase Workers compensation premium reduction of $21,300 General Fund Budget Assumptions 7 8 Transportation Revenues Supplemental funding to replace lost gas tax Countywide ballot measure for local transportation projects Animal control costs and a new animal shelter Future challenges and unmet needs Infrastructure (parks, streets, facilities) Technology Vehicle/equipment replacements Operational items (General Plan update, unfunded positions) Long-term liabilities (PERS, Brisco debt service) Unknown Factors 9 General Fund Summary 10 General Fund Expenditure Changes 11 Recommended Adjustments 12 Recently reviewed financial status on May 10, 2016 Current revenue levels will not sustain the funds Impact of drought on water consumption Rate Increases proposed for Water and Sewer Funds Water & Sewer Funds 13 Recommended Adjustments 14 Capital Improvement Program 15 Local Sales Tax Fund Changes 16 Approve detailed budget adjustments listed in the Budget Update Report Adopt a resolution approving the FY 2016-17 Budget Recommended Action 17 Questions 18 19