RPVCCA_CC_SR_2013_04_30_01_Annual_Budget_DocumentCITY OF
MEMORANDUM
4o RANCHO PALOS VERDES
TO:
FROM:
DATE:
SUBJECT:
REVIEWED:
HONORABLE MAYOR &CITY COUNCIL MEMBERS
DENNIS McLEAN,DIRECTOR OF FINANCE &~
INFORMATION TECHNOLOGY
APRIL 30,2013
ANNUAL BUDGET DOCUMENT (Supports 2013 City
Council Goal of Government Efficiency,Fiscal Control
and Transparency)
CAROLYN LEHR,CITY MANAGER a9--
Project Manager:Kathryn Downs,Deputy Director of Finance &Information V"
Technology ~
RECOMMENDATION
Introduce Ordinance No._,amending chapter 3.32 (Budget Administration)of the
Municipal Code to rescind the provisions regarding the two-year budget cycle.
DISCUSSION
In 1999,City Council adopted Ordinance 343 requiring production of a two-year budget
document.One of the purposes of preparing a two-year document was to save time in the
second year of the budget cycle.
The budget document serves at least the following two purposes:
1.A tool to communicate the City Council's spending plan to the public;and
2.A working document for City Staff to manage the budget.
The City currently budgets for 457 different ledger accounts (revenues,expenditures and
interfund transfers).During the last 3 two-year cycles,the following numbers of accounts
in the budget document were adjusted with adoption of the second year of the two-year
budget cycle:
•2008 -101 adjustments,about 22%of the document.
•2010 -184 adjustments,about 40%of the document.
•2012 -152 adjustments,about 33%of the document.
Preparation of the two-year budget document is no longer saving time.Public documents1-1
ANNUAL BUDGET DOCUMENT
April 30,2013
Page 2 of 2
for the second year of the two-year cycle are confusing for both the public and Staff;and
narratives and performance data become stale.To improve clarity and transparency,Staff
recommends production of an annual budget document.At the March 19,2013 City
Council meeting,during discussion of BUdget Policy Issues,City Council Members
individually agreed with Staff's recommendation.
If the City Council proceeds with Staff's recommendation,the proposed Ordinance would
be introduced on April 30 th and adopted on May i h .The draft FY13-14 budget would be
presented in a single-year document with 3 years of actual historical data and the revised
FY12-13 budget.
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ORDINANCE NO.
AN ORDINANCE OF THE CITY OF RANCHO PALOS
VERDES AMENDING CHAPTER 3.32 (BUDGET
ADMINISTRATION)OF THE RANCHO PALOS VERDES
MUNICIPAL CODE TO RESCIND THE PROVISIONS
REGARDING THE TWO-YEAR BUDGET CYCLE
THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES HEREBY
ORDAINS AS FOLLOWS:
Section 1:Chapter 3.32 of Title 3 of the Rancho Palos Verdes Municipal Code
is hereby amended to read as follows:
Chapter ~.32
BUDGET ADMINISTRATION
Sections:
3.32.010
3.32.020
3.32.030
3.32.040
3.32.050
3.32.060
3.32.070
3.32.080
3.32.090
3.32.100
3.32.110
3.32.120
3.32.010
Purpose.
Fiscal year established.
Submission date and content.
Budgetary definitions.
Funds established.
Form of presentation.
Transfers between accounts and supplemental appropriations to originally
adopted budget.
Public hearings.
Date of adoption.
Filing of budget.
Duplication.
Midyear budget review.
Purpose.
This chapter is established for the purpose of standardizing the city's procedure
for the administration of a budget system.Its provisions are intended to control the
execution of municipal activity in accordance with a predetermined financial plan.
3.32.020 Fiscal year established.
Each fiscal year shall begin on the first day of July and shall end on the thirtieth
day of June.
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3.32.030 Submission date and content.
On or before June 5th of each year,the city manager shall submit a budget for
the coming fiscal year to the city council.At a minimum,the bUdget shall contain the
following:
A.A budget message;
B.All anticipated revenues;
C.All expenditures schedules for all funds,functions and programs of the city
(except trust and similar-type funds);
D.A schedule showing the comparison of all revenues and expenditures and
the status of all surplus or reserve accounts;
E.
F.
3.32.040
Expenditures and revenues for any city-wide special assessment activity;
The number of authorized full-time equivalent positions for each function.
Budgetary definitions.
The following terms shall be defined for the purposes of this chapter as follows:
A."Activity"means a specific and distinguishable service within a budgetary
program which is performed to fulfill a community need or to accomplish a matter for
which the government is responsible (e.g.,the annual Fourth of July celebration is an
activity within the special events program).
B."Department"means a designated organizational unit of the city
government (e.g.,finance).
C."Function"means a combination of programs and activities which are
authorized by budget appropriations and are designed to achieve a major purpose of
the city (e.g.,recreation and parks).
D."Fund"means a separate fiscal and accounting structure which
segregates accounting records for the various budgetary functions and is established
according to Section 3.32.050.
E."Object accounts"means expenditure classifications according to the
types of items purchased or services obtained (e.g.,operating supplies,
professional/technical services).
F."Program"means an activity or a group of activities designed to achieve a
specific goal or objective associated with a budgetary function of the city (e.g.,special
events is a program within the recreation and parks function).
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3.32.050 Funds established.
A general fund shall be established for the accounting of all of the city's financial
resources not controlled by other funds established in accordance with this chapter.
A.The director of finance,with the approval of the city manager,shall
establish a separate fund whenever any of the following exists:
1.When required as a condition of the granting of funds by another
agency;
2.When an isolated or independent audit trail is required by statute;
3.Where accounting practices within the general fund cannot
adequately distinguish the activities of the city that must be integrated with respect to
program activity or the sources of revenues and expenditures.
3.32.060 Form of presentation.
The budgets for each fund,function and program of the city shall be arranged in
such a manner as to clearly show:
A.The anticipated expenditures for the fiscal period closing;
B.The actual expenditures for the prior fiscal year;
C.The most appropriate categorization by bUdgetary function.
3.32.070 Transfers between accounts and supplemental appropriations to originally
adopted budget.
Transfers between object accounts and expenditures in excess of budgeted
allocations may be effected only as provided in this section:
A.The city manager may approve transfers to adjust for operation,
maintenance and personnel expenditures between any program's object accounts as
long as the transfers are within the same budgetary function and the same fund (subject
to subsection C of this section).
B.All other transfers must be approved by action of the city council.
C.No full-time equivalent positions may be added to those specifically
approved in the budget document without the authorization and supplemental
appropriation of the city council.
D.All expenditures that are in excess of a fund's and/or function's budgeted
allocations must be approved by supplemental appropriation by the city council.
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3.32.080 Public hearings.
Prior to the commencement of any fiscal year the budget is in effect,the city
council shall hold a public hearing on the budget.
3.32.090 Date of adoption.
The budget shall be adopted by the majority vote of the city council.If adopted
subsequent to July 1st,it shall take effect immediately upon adoption.During any period
in which a new budget has not been adopted,the prior year's budget shall be in force
and effect but shall be replaced retroactively by the new budget;provided,however,
expenditures shall not exceed the amounts approved in the new budget.
3.32.100 Filing of bUdget.
A copy of the budget shall be certified by the city clerk as adopted by the city
council and filed as a pUblic record in the office of the city clerk.
3.32.110 Duplication.
Sufficient copies of the adopted budget shall be prepared each year to supply all
council members and department heads.At least one copy shall be available for public
inspection in the offices of the city clerk,and the budget shall be posted on the City's
website.
3.32.120 Midyear budget review.
The city manager shall provide the city council with a midyear status report on
the budget,as it compares to the adopted budget,including any recommendations the
city manager believes are appropriate.
PASSED,APPROVED and ADOPTED this _day of 2013.
MAYOR
ATTEST:
CITY CLERK
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES )
CITY OF RANCHO PALOS VERDES )
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I,Carla Morreale,City Clerk of the City of Rancho Palos Verdes,do hereby certify that
the whole number of members of the City Council of said City is five;that the forgoing
Ordinance No._passed first reading on ,was duly and regularly
adopted by the City Council of said City at a regular meeting thereof held on
_____,and that the same was passed and adopted by the following roll call
vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
CITY CLERK
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