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Agenda Packet 2011-03-24 SPCity Council Tony Ferrara, Mayor /Chair Caren Ray, Mayor Pro Tem/Vice Chair Joe Costello, Council /Board Member Jim Guthrie, Council /Board Member Tim Brown, Council /Board Member Agenda Steven Adams City Manager Timothy J. Carmel City Attorney Kelly Wetmore City Clerk NOTICE OF SPECIAL MEETING FISCAL YEAR 2071 -12 & 2012 -13 BUDGET CITY COUNCIL /REDEVELOPMENT AGENCY AGENDA SUMMARY THURSDAY, MARCH 24, 2011 6:00 P.M. City of Arroyo Grande Woman's Club & Community Center 211 Vernon Street, Arroyo Grande 1. CALL TO ORDER: 6:00 P.M. 2. ROLL CALL: COUNCIL /RDA 3. FLAG SALUTE: MAYOR FERRARA 4. CITIZENS' INPUT, COMMENTS, AND SUGGESTIONS on Special Meeting Agenda Items. Members of the public wishing to address the Council /RDA on any item described in this Notice may do so when recognized by the Presiding Officer. 5. CONSIDERATION OF FY 2011 -12 AND FY 2012 -13 BUDGET STRATEGIES [CC /RDA] (ADAMS) Recommended Action: Review and approve the following proposed strategies to address the projected budget shortfall in the FY 2011 -12 and FY 2012 -13 Biennial Budget: 1) pursue labor concessions to address increases in salary and benefit costs; and 2) utilize reserves in excess of the minimum 15% reserve policy. 6. ADJOURNMENT to the Regular City Council /Redevelopment Agency Meeting of Tuesday, April 12, 2011 at 7:00 p.m. in the Council Chambers, 215 East Branch Street. * * * * * * * * * * * * * * * * * * * * * * * * ** This agenda was prepared and posted pursuant to Government Code Section 54954.2. Agenda reports can be accessed and downloaded from the City's website at www. arroyogrande. or If requested, the agenda shall be made available in appropriate alternative formats to persons with a disability, as required by the Americans with Disabilities Act. To make a request for disability - related modification or accommodation, contact the Legislative and Information Services Department at 805 - 473 -5414 as soon as possible and at least 48 hours prior to the meeting date. RO INCORPORATED U JULY 10, 1911 MEMORANDUM TO: CITY COUNCIU EDE IEL PI TENT AGENCY BOARD FROM: STEVEN ADAMS, CITY MANAGER/EXECUTIVE DIRECTOR I SUBJECT: CONSIDERATION OF FY 2011 -12 AND FY 2012-13 BUDGET STRATEGIES DATE: MARCH 24, 2011 RECOMMENDATION: It is recommended the Council/RDA Board approve the following proposed primary strategies to add the projected budget shortfall in the FY 2011-12 and FY 2012- 1 3 Biennial budget: 1 pursue lab concessions to address increases in salary and benefit costs; and 2 utilize reserves in excess of the minimum 15% reserve policy. FINANCIAL IMPACT: Staff has not fret developed detailed revenue and expenditure projections. Preliminary General Fund revenue estimates for FY 2011 -12 are in the range of $13,050,000 to 1 3,150,000 in FY 2011 -12 and $13,250,000 to 1 3,350,000 in FY 2012 -13. This has been derived by simpler assuming actual revenue amounts from FY 2009-1 g, subtracting one -time revenue sources, subtracting revenue sources transferred to the Fire Cities Fire Authority, adding projected increases in sales to revenues, and adding projected increases in transient occupancy tax (TOT) revenues. Preliminary expenditure projections are in the range of 13,850 .,000 to 13,950,000 in FY 2011 -12 and $14,100,000 to $14,200,000 in FY 2012 -13. Therefore, the preliminary projected budget shortfall is $700,000 t 900,000 in FY 2011 -12 and $750,000 t $950,000 in FY 2012 -13. BACKGROUND: City staff is preparing recommendations for the FY 2011 -12 and FY 2012 -13 Biennial Budget. At the request of the Council /FDA Beard, a series of budget workshops have been scheduled this year to assist in increasing public participation and input into the budget process. As the first step in the budget process,, the Council /FDA Board approved budget goals at the (larch Stn meeting, which were based on discussion and feedback at a public workshop on February 17 The purpose of the second workshop is to develop general budget strategies t o address the budget goals and projected shortfall. The final workshop will be what is Agenda Item 5.a. Page 1 CITY COLI NCIU EDE EL PIIIIENT AGENCY BOARD FY 2011-12 ASV D FY 2012-13 BUDGET STRATEGIES MARCH 24, 2011 PAGE 2 traditionally held to present the recommended budget, which is scheduled on May 2 th at 6:00 p.m. in the city council Chambers. The economic recession has created major financial challenges for the city. During the past four years, shortfalls of 1 to 2 million have been add ressed. The city's approach to budget challenges has been to place the highest priority on maintaining its services to the community. A comprehensive restructuring of the organization has been implemented, which was designed to cut costs while minimizing the impacts to service levels through consolidation of operations. A total of 12 full-time and 6 part- time positions have been eliminated during these budget cycles, several through layoffs. O ver the past 10 years, full -time positions have been eliminated by over 20%. Despite these challenges, FY 2009-10 revenues ce d d expenditures and reserves were increased well above the 15% minimum. services have been maintained and enhanced in some areas through a very dedicated staff, who have been required to assume an increasing workload in order to make these changes successful. ANALYSIS OF ISSUES: Jp-p-nue Preliminary General Fund revenue estimates assume most revenue sources to remain the same as actual revenues in FY 2009 -10. sales tax revenues assume a 3% annual increase annual. TOT revenues conservatively assume an additional '12- month delay in opening of the Hampton Inn, which would increase revenues by approximately $75,000 in FY 2011 -12 and an additional $125,000 in FY 2012 -13. Brea kdown of shortfall Before developing strategies to add the City's budget challenges for the upcoming biennial budget and future, it is important to analyze the basis and reasons for the shortfall. There are a number of factors, but the primary causes of the shortfall can be summarized as follows: Structural Deficit $200,000 PERS Fate Increases $300,000 Salary Increases $250,000 Liability costs $50,00 Total $800,000 Structural Deficit Due largely to the ongoing severe economic problems at the Federal and state levels of government, "structural deficit" is a term that is now frequently heard. structural deficit is simply the reoccurring part of the deficit. Therefore, that part of a shortfall than is addressed through one -time revenues or cost reductions constitutes the structural deficit. Agenda Item 5.a. Page 2 CITY COUNCIU EDE EL PMENT AGENCY BOARD FY 2011-12 AND FY 2012=13 BUDGET STRATEGIES MARCH 2 , 201'1 PAGE 3 During the prior budget deliberations, the majority of the shortfall w addressed through a comprehensive restructuring of the organization. This addressed 5% to 80% of the deficit on an ongoing basis. The remainder of the shortfall was funded through one -time revenues than were generated primarily through the sale of City property, the revenue of which was programmed (but not all used) over a 2 -year period. The objective was to reduce the structural portion of the deficit through consolidation of City functions to an amount that could be eliminated in the future through increased revenue if costs were held constant. As ar result, when considering revenue increases and increased savings from past staffing adjustments, about $200,000 of the $800,000 can be viewed as a carryover from the prior budget. Salary Increases In 2008, the City negotiated changes to retiree medical benefits with all labor groups. These changes were ar monumental effort to manage future retiree medical costs and were urgent to freeze benefits prior to increases than would have been illegal to eliminate once in place. All labor groups other than management received pay increases as part of the negotiated agreement. Since then, delays in the increases have been negotiated for several years to address budget shortfalls. The preliminar budget projections assume costs for these increases occurring as now scheduled on June 23, 2011. Costs for c omparable management increases have also been assumed in order to ensure any concessions are applied fairly amongst the different labor groups. As a result, the salary increases due to -take effect result in an increased cost of approximately $250,000. PERS Pension Program Costs for the Public Employee Pension System PETS for the employees} pension are based upon to rates, the employer share and the employee shame, which are a percentage of each employee's salary. The employer shame is determined b actuarial actuarials prepared by PERS. The employee shame is ar constant rate. The City's existing e mployer shame is 15.850% for miscellaneous employees and 35.911 % for police. The employee share is 8% for miscellaneous employees and 9% for police employees. However, it has become typical for organizations to pay a portion or all of the employee shame. The City of Arroyo Grande pays 5.5% of the 8% for miscellaneous employees and 6.5% of the 9% for police employees. Therefore, the total cost paid for each employee for pension benefits is 21.350% of salary for miscellaneous employees and 42.411 % of salary for police employees. As throughout the country, pension costs have become a significant cost issue for the City. From FY 1998 -99 through FY 2002 -03,, the employer share w as 0 %. The plans that cities participate in were largely put into place several years ago when existing and future rates projected by PETS w ere very lour. Since PETS projections have historically been fairly accurate, these decisions were not made to provide unreasonable benefit levels to public employees, but instead provided ar very cost Agenda Item 5.a. Page 3 CITY COUNCI fF EDE ELOPMEI T AGENCY BOARD FY 2011-12 AND FY 2012-13 BUDGET STRATEGIES MARCH 24, 2011 PAGE 4 effective way in which to compensate employees. However, rates have increased much more than expected and PERS provides very little flexibility to adjust benefits for existing employees. If no adjustments in the allocation of the employee share are negotiated, the total amount paid by the City will rise to 25.009% for miscellaneous and 48.855% for police in FY 2011 -12. This represents an increased cost of approximately $300,000 to the General Fund. Fates are then projected to continue to increase to $25.600% for miscellaneous and 50.100% for police in FY 2012 -13. Options available for negotiation that marry jurisdictions are now pursuing include requesting employees to pay a larger portion of the employee share and instituting a two- tiered retirement plan. PERS and the State constitution preclude the City from modifying the benefit plans for existing employees. Ho wever, less costly plans can be implemented for all future employees. This would not impact the projected shortfall for the upcoming budget, but would reduce future costs. Liability Program The City receives liability coverage through membership in the California Joint Powers Insurance Authority C JPIA , a statewide insurance pool of public agencies. Due to major claims recently experienced by the C JPIA and an adjustment to their formula, members were recently notified of unfunded liabilities. The City of Arroyo Grande's is $700,000. The CJPIA would life these amounts paid by July 2013, but will alloy the payment period to be extended with interest beyond that date. Staff is recommending $50,000 be budgeted annually for the payment and at least the first $1 00 of any funds unexpended at the end of the fiscal year be committed for this purpose. The goal will be to pay off the unfunded liability within a -year period. Retiree Medical oP EB A goal was discussed at the Budget Goals Workshop to begin efforts to pre -fund Other Post Employment Benefit Costs PEB, which consist of retiree medical expenses. The City's future OPEB liabilities ies gill be reduced significantly from projections from the last actuarial in 2007 due to negotiated modifications to these benefits mentioned above. However, OPEB costs will still increase in order to pre - fund the benefits. Up to this point, they have been funded on a "pary as you go" basis. They should instead be pre- funded to avoid significant unfunded liabilities in the future. It is also anticipated that this may become a requirement dine to proposed statewide reforms of public retirement benefit programs. Staff is recommending funding for an updated actuarial in FY 2011 -12. Therefore, it is recommended funding be allocated in FY 2012 -13 to begin pre - funding these costs based upon the results of the actuarial. It is projected that this will increase annual costs by as much as $200,000. Agenda Item 5.a. Page 4 CITY COU CURE E 1ELOP E T AGENCY BOARD FY 2011-1 AND FY 2012-13 BUDGET STRATEGIES MARCH 24, 2011 PAGE 5 Redevelopment Agency The City's Redevelopment Agency remains balanced at this time with all funding appropriated. The Governor's current budget proposal includes elimination of redevelopment. The League of California Cities and the California Redevelopment Association (CRA) have taken the position that this would violate Proposition 22 and the State Constitution. The Redevelopment Agency has already provided funding to the CRA to be used toward litigation if necessary. In the meantime, both organizations have proposed negotiations with the State to develop an alternate means of voluntarily assisting school funding without elimination of redevelopment. However,, in addition to funding projects, the Agency funds a variety of staffing and operational costs that are involved in providing economic development activities. Since these staff and activities are not dedicated fuller to these functions, elimination of the funding would directly increase costs to the General Fund. It is estimated that the impact on costs would be as much as 0,000. However, some revenue currently received by the Agency would then be transferred to the City. Therefore, the net impact is not fret known. Staff has requested the City's redevelopment consultants prepare an analysis on the cost impact so contingence plans can be developed as part of the budget process. Water Fun d Due to decreased water usage, revenues have dropped below anticipated level despite rate increases that have taken effect. Revenue projections have not fret been prepared. However, it is anticipated that reserves may fall below minimum policy amounts. ^rhe existing rate s tudy and approved rate increases run through F 2013-14. Therefore, staff is proposing as a strategy to delay capital projects and reduce operational costs as necessary to maintain an appropriate fund balance until the net rate s tudy is prepared. Rwr Fund Since sewer charges are largely based on water usage amou sewer revenue have also dropped below anticipated levels. Therefore, staff is also proposing as a s trategy to delay capital projects and reduce operational costs as necessary to maintain an appropriate fund balance until the net rate s tudy is prepared. Local Sales Tax Fund The Local Sales Tax Fund is technically park of the General Fund, but is accounted for separately in order to earmark and track the revenues for the purposes intended when the Local Sales Tax measure was proposed and approved. The Local Sales Tax Fund is anticipated to maintain the minimum policy reserve amount of 15%. It is likely that few changes to the current -gear project cost projections will be recommended. As a result of the budget goals workshop, staff is working on some increase to sidewalk funding and changes to the pavement management schedule. If South Counter is unsuccessful in achieving urban area status due to the Census results, anticipated street improvement funds will also be negatively impacted. Agenda Item 5.a. Page 5 CITY COUNCIUREDE1 ELOPMENT AGENCY BOARD FY 2011-12 AND FY 2012=1 3 B U DG ET STRATEG IES ARCH 24, 201 '1 PAGE 6 Facility Funds The City maintains funds for development impact fees, which are used for capital improvements to mitigate the impacts of new development. These include improvements to facilities for transportation, traffic signals, recreation, parks, police, fire., water and sewer. The reduction in construction activity over the past fever years has caused this fee revenue to be largely depleted. As a result, other funds have had to assume an increased burden of funding capital projects. This has especially been an impact on the Water and Sewer Funds. School Resource officer Program Information regarding the School Resource a officer (SRO) program was requested at the budget goals workshop to consider whether it should continue to be funded in the future. The total cost of this position is approximately $122,000. Half is paid by the Lucia Mar Unified School District. Therefore, the net cost is approximately $6'1,000. Staff believes this program is extremely important to the City's public safety services and should be maintained. Given the City's demographics, a substantial portion of public safety issues are youth related. If the position were not dedicated to the schools, it would require other Police Department personnel to respond to a large volume of school related calls for service. Therefore, the overall staffing level needs would not necessarily be reduced. In 2010, the position responded to 210 calls for service. While the position is housed at and primarily assigned to, Arroyo Grande High School, the SRO is responsible for responding to requests from Paulding Middle School and ocean View and Harloe Elementary schools. It is also critical in providing activities to proactively reduce youth related incidents and to be readily accessible given the sensitive nature of teen crime and violence issues. A request was made for resident data for Arroyo Grande High School students, which is as follows: City of Arroyo Grande City of Grover Beach City of Pismo Beach oeano Unincorporated Arroyo Grande fiporno Other Total 840 (38.67%) 13 (23.61%) 171 (7.87%) 318 14.64% 280 12.89% 39 10(.46% 2 While students reside in different South County jurisdictions, public safety calls for service are the primary responsibility of the jurisdiction in which the incident occurs. Therefore it would be difficult to obtain funding participation from other agencies since the high school is located within the Arroyo Grande incorporated area. Agenda Item 5.a. Page 6 CITY COUNCIL/REDEVELOPMENT ACE CY BOARD FY 2011-12 AND FY 2012-13 BUDGET STRATEGIES MARCH 24, 2011 PACE 7 Below is a comparison to how similar programs are implemented and funded throughout the County: Arroyo Grande (1 SRO) Paso Robles (1 SRO) Atascadero San Luis Obispo Morro Bay San Luis Obispo County (4 SROs) 0% of costs paid by School District 0% of costs paid by School District No SRO prog City funds 100% No SRO p rg ra inn County funds 1 % in North County; School District funds approximately 25% of costs in South County Recreation Services The Recreation Division has two full time s upervisors and one full time coordinator who organize and supervise all of the City's recreation programs and schedule all of the City's recreation facilities. One of the s upervisors oversees the City's sports programs, special interest classes and recreation facilities. The other supervisor oversees the City's child care programs, pre - school, playgrounds programs and special events. The coordinator splits time between the two supervisors, as well as assists in providing office coverage. The entire subsidy of these programs is estimated to be approximately $73,080 annually when reducing costs this year for the Facilities Coordinator position that was eliminated. A summary of staffing, costs and programs is provided below. w. 0 Sports, Facilities and Classes Staffing Summary: 1 Full -time Recreation Su pervis r 1 Half - time Recreation Coordinator 3 Pant -time Building Supervis 25 seasonal scorekeepers, umpires and basketball referees Programs and Services: Youth Basketball for children grades one through eight. (approximately 1,000 children, 200 volunteer coaches and volunteer referees) - Adult Basketball, spring, summer and fall participants) - Adult softball, spring and summer, with divisions. teams, 1 ,330 participants) - Contract /special interest classes (15-2 months) seasons. (75 teams, 675 wren's, womeWs and coed classes offered every Agenda Item 5.a. Page 7 CITY COUNCIL /RED E EL PI IEI T AGENCY BOARD FY 2011-12 A D FY 212 -P1 UDG ET STRATEGIES MARCH 24, 2011 PAGE 8 Recreation Facilities, 7 sports fields, 4 parks, 7 group barbeque areas, 5 tennis courts and 2 community centers. Approximately 25,000 people per year use the community centers. Estimated total (Includes 100% of the Recreation Supervi r. Does not include $88,000 for 50% o f a Recreation Coordinator nor revenues for community center rentals) Revenue $ Expenditures $203,600 Subsidy $ 25 • Childcare, Pre - school and Special Events Staffing Summary: 1 Full -time Recreation Supervi r 1 Half -time Recreation Coordinator 15 Part -time Child Care Staff Programs and Services: Before and after school child care at three sites, including Ocean View, Elm Street Community Center and Branch School with approximately 150 children per day Full day child care and seasonal playground programs during school breaks, including; summer (80 children), printer (50 children), spring (40 children, Thanksgiving 85 children, teacher in service training days (30 children. - Enrichment classes at Ocean View Elementary School, including 2 sessions of robotics with a total of 44 children, 8 sessions of music with 85 children, holiday crafts with 10 children, and currently the first o three Spanish classes with 15 children. - Year round pre - school for children 8 — 5 years of age with 70 — 8 children per 4 creek session - Eight special events per year, including Summer Carnival with 800 participants, Harvest Festival activities, Halloween Carnival and Haunted (laze with approximately 1,000+ participants, Turkey Trot Fun Faun with 800 attendees, Volunteers Banquet, Egg bunt and Family Festival with appr 8,000 participants, Father Daughter Date Night with 200+ participants, 8 Parents Night Out activities with and average of 18 children per event. - Five fundraising events. The first two fundraiser have netted $2,500. Agenda Item 5.a. Page 8 CITY Co i CIURE EVELOPMEi T AGENCY BOARD FY 201142 AND FY 2012-13 BUDGET STRATEGIES MARCH 24,2011 PAGE 9 Estimated Total (includes1 of a Coordinator from July — December, and June) Recreation reation Su pervi or, 100% of the 500 of the Coordinator from ,January - Revenue $318,871 Expenditures $366,651 Subsidy $47 In addition to all the programs listed above, the Recreation Division provides community service opportunities for Carl Poly, Cuetar College, Hancock College, Arroyo Grande High School, Grizzly Academy, Camp Fire, Boy Scouts, International Forester's and the Lions Club. ALTERNATIVES: The following altdrnatives are provided for the Council/RDA Board's on iderartion : Larbor Concessions Since the majority of the shortfall is due to in in s alary and benefit costs, it is recommended the primary strategy for addressing the shortfall be through concessions from labor groups to assume a larger portion of these costs. These could include payment of pension and health benefit costs, salary reductions, and other measures to redu labor costs. Existing labor agreements, (Memorandums of Understanding or OUs) with Service Employees International Union SEI and the Police Officers' Association AGPOA are due to e on June 3, 2011. Negotiations are scheduled to begin in April 2011. Changes to salaries and benefits would be negotiated through this "meet and confer" process, as well as through discussions with management employees. Rim- P. rvP Reserves erve currently exceed the 15% minimum policy goal and will likely increase at year -end barred upon current FY 2010 -11 revenue and ependiture levels. The purpose of a minimum reserve level is to ensure sufficient funds are available to address emergencies, unanticipated a penditure , and unanticipated decreases t o revenue sources. Funds accumulated above the minimum are then available for one -time expenditures and to help maintain service levels during periods of declining revenues. The objective is to increase revenues above the minimum during positive economic periods and then utilize reserves during negative economic periods to maintain an ongoing consistency in service levels despite fluctuations in the economy. Therefore, it is recommended that some level of reserves above the 15% minimum be used to address the shortfall. An amount in the range of $ to $ would probably be appropriate. This would help in the feasibility of addressing the remaining shortfall through labor concessions, while at the same time continuing Agenda Item 5.a. Page 9 CITY COUNCIU E E ELOPME IT AGENCY BOARD FY 2011-1 AND FY 2012 -1 BUDGET STRATEGIES MARCH 24, 2011 PAGE 10 to decrease the City's reliance on one -time revenue sources despite increasing costs. Reductions in Staffing and Efficiency Measures Costs can be reduced through either layoffs, early retirement "golden handshake" programs attrition and hiring freezes. The restructuring plan that was implemented last year was designed to strategically maintain service levels with minimum staffing. Therefore, after further review of the organizational structure, staff believes no additional staffing reductions are possible without significant impacts to services and projects. The reorganization has generally worked as intended, but has resulted in heavy workloads and problems during vacancies and absences given Tittle backup personnel available for many functions. The primary remaining opportunity for increased efficiency that has been identified is potential consolidation of public safety services with the City of Grover Beach. It is under study at this time, but cannot yet be identified as a cost saving measure since it will require agreement from an outside agency. Service Level Reductions The City's approach to addressing the current and past budget challenges has placed the highest priority on maintaining services to the community, which is particularly important since the City of Arroyo Grande provides only core municipal services. Therefore, no service level reductions are recommended. The areas reviewed in response to City Council direction include the recreation and the school resource officer programs. Based upon the analysis presented above, elimination of these programs is not recommended. Both provid important youth related services and costs are partially offset by other revenue sources. As a result, elimination of the programs would not substantially reduce costs and the cost reduction provided would not justify the s ervice level reduction. Delay of Capital lmr)rovements and Use of Local Sales Tax Revenues - Fhe City has maintained a commitment to utilizing funding from the Local Sales Tax Measure for the purposes originally intended, which is primarily capital improvements. However, the funds are not legally restricted and can be used for operational costs if necessary. Staff does not recommend this because reduction in capital improvements only defers necessary maintenance and increases future costs. Fee, Tax and Other Revenue Enhancements Tax and fee increases are not recommended as a budget strategy. The City has completed fee studies over the past fear years. Therefore, most are established at appropriate and up to date amounts. Tax increases would place an additional financial burden on the City's residents and visitors, which would not be appropriate given the impacts of current economic conditions. Agenda Item 5.a. Page 10 CITY COLINCIUREDEVELOPMENT AGENCY BOARD Flt 2011-12 AND Flt 2012-13 BUDGET STRATEGIES MARCH 24, 2011 PACE 11 few minor fee categories exist that staff may recommend reviewing to ensure they are established at appropriate levels to recover costs and remain co mpetitive with other organizations. However, they would represent whir minor adjustments at most and would not meaningfully impact the budget shortfall. Economic Development Little recent progress has been experienced n targeted economic development efforts. If redevelopment is eliminated and/or substantially reduced, the City's capacitor to maintain an economic development program would largely cease. Analysis by the City's redevelopment consultant has also demonstrated little demand for new large sales tax generating businesses. Therefore, no new revenue from economic development activities is being assumed at this time. ADVANTAGES: Staff's recommended strategies will provide the highest likelihood of successfully addressing the City's budget shortfall and maintaining financial stability, while also maintaining critical service levels and an appropriate capital improvement program. DISADVANTAGES: Recommended strategies will have a significant impact on dedicated and hard working staff, which may impact morale and create challenging labor negotiations and relations. Use o reserves will also maintain some financial reliance on one- time revenue sources. ENVIRONMENTAL RE IE : No environmental review is required for this item. PUBLIC 1 TIFICATl 1 AND COMMENTS: 1TS: The agenda was posted in front o City Hall o n Tuesday, March 22, 2011 and on the City's website on Wednesday, March 23, 2011. A press release was issued and the workshop was announced in an article in the Stagecoach Egress, Channel 2 bulletin board, and on the City's wetsite. Agenda Item 5.a. Page 11 THIS PAGE INTENTIONALLY LEFT BLANK Agenda Item 5.a. Page 12 CI c INCORPORATED 9 it JULY 10. 1911 4. ,L IFORN 'P MEMORANDUM TO: CITY COUNCIL FROM: STEVEN ADAMS, CITY MANAGER SUBJECT: CONSIDERATION OF FY 2011 -12 AND FY 2012 -13 BUDGET STRATEGIES — SUPPLEMENTAL INFORMATION DATE: MARCH 24, 2011 Following distribution of the staff report for the Budget Strategies Workshop, staff has identified corrections to cost and revenue figures regarding recreation services. These costs are based upon FY 2010 -11 projections adjusted for the recent staffing and organizational changes that have been implemented. Sports, Facilities and Classes Revenue $220,300 Expenditures $257,600 Subsidy Subtotal $ 37,300 Park User Fees $32,000 Subsidy Total $ 5,300 Park User fees are identified separately because they are generally intended to recover costs associated with maintaining the parks and fields. These costs are included in a separate budget. However, it is important to identify this revenue in the discussion because staff from this division operate the program of administering the park user fee programs. Therefore, the revenue would not be received if the staff were eliminated. Childcare, Pre - school and Special Events Revenue $318,871 Expenditures $347,651 Subsidy $ 28,780 Total subsidy w/o park user fee revenue $ 66,080 Total subsidy with park user fee revenue $ 34,080 Please let me know if you have any questions. Thank you.