RPVCCA_CC_SR_2014_06_17_06_City_BudgetCITY OF RANCHO PALOS VERDES
PUBLIC HEARING
Date: June 17, 2014
Subject: Proposed FY 14-15 Budget
Subject Property: Citywide
1. Declare the Hearing Open: Mayor Duhovic
2. Report of Notice Given: City Clerk Morreale
3. Staff Report & Recommendation: Kathryn Downs, Deputy Director of Finance
4. Public Testimony:
5. Council Questions:
6. Rebuttal:
Appellants: N/A
Applicant: N/A
7. Declare Hearing Closed: Mayor Duhovic
8. Council Deliberation:
9. Council Action:
6-1
CrTYOF RAtiCHO PALOS VERDES
MEMORANDUM
TO:
FROM:
DATE:
SUBJECT:
REVIEWED:
Project Manager:
HONORABLE MAYOR & CITY COUNCIL MEMBERS
DENNIS McLEAN, DIRECTOR OF FINANCE & ~
INFORMATION TECHNOLOGY Y}J!J
JUNE 17, 2014
PROPOSEDFY1~15BUDGET
CAROLYNN PETRU, ACTING CITY MANAGE~
Kathryn Downs, Deputy Director of Finance & Information
Technology
RECOMMENDATION
1) Determine that the utility users' tax (UUT) rate of 3% continues to be a necessary
General Fund revenue source, and that the current rate of 3% should be
maintained; and
2) ADOPT RESOLUTION NO. 2014-_, A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF RANCHO PALOS VERDES APPROVING A BUDGET
APPROPRIATION AND ADOPTING THE OPERATING AND CAPITAL
IMPROVEMENT BUDGET FOR FISCAL YEAR 2014-2015.
DISCUSSION
Note: Municipal Code Section 3.30.190 requires that the City Manager submit to the City
Council an analysis of the revenues derived from the Utility User Tax (UUT) annually.
Based on the needs of the City, the City Council shall determine if any modification to the
tax rate is appropriate or if the UUT is unnecessary. The tax rate cannot be increased
without a majority vote of the residents of the City during a Municipal Election. The staff
analysis to enable the Council's determination is included in the staff report, "2014 Five-
Year Financial Model", dated June 17, 2014. Staff requests that the City Council consider
the UUT analysis and its determination by considering the 2014 Five-Year Financial
Model and Proposed FY14-15 Budget concurrently.
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PROPOSED FY14-15 BUDGET
June 17, 2014
Page 2of4
Staff has prepared the proposed FY14-15 Budget that incorporates City Council direction
provided on March 18, 2014, April 29, 2014 and June 3, 2014. Each City Council Member
has separately received a copy of the proposed budget document that was available at
City Hall and on the City's website for review for on June 12th (Note: the draft document
has been available since May 23, 2014). Notice of the public hearing was posted in the
Palos Verdes Peninsula News on June 5th and June 12th.
The proposed budget for FY14-15 result$ in estimated net activity of $217,671 in the
General Fund, a balanced budget and continued General Fund Reserves in excess of the
Reserve Policy threshold as follows:
ltiii•iiilii•li1tt.11~1:fiini:11111 .. :d::: .::.: ••..• ,.._ .. ,m111i: . .-:., .. if.,!fim1:...: .. , :;r11i.1.:-:::_:p
R~y~n.LI~ $ 26,317,25.5 . $ 231,306 $ 26,5.48,5~1
·Transfers from Other Funds
Estimated Excess General Fund Reserve
~xpendi_tures .
Transfers to Other Funds . ... . . . ··~~ ...
Increase of General Fund Reserve
Threshold (50% of Increase to
208,000 208,000
1,922, 779. 1,922, 779
{18,~3],233)_ (1,550,206) (20,487,439)
. (7,5S4,506) (7,584,506)
Expenditures) (389, 724) (389, 724)
:i.ll::lli,l:llBll='·:i:i:·1:·:_,=:· .. •·-.; == · rn .$ ff••• ii$ij ~ ~l;i$H$.•• ·••••iJ.l:i?i••·
General Fund Revenue is expected to increase by about 3.1% from FY13-14, and draft
expenditures are expected to increase by about 4.0%.
City Council Policy No. 45 -Balanced Operating Budget states: "The City Council shall
adopt an annual operating budget where recurring expenditures do not exceed recurring
revenues, and ongoing program expenditures are not funded with one-time revenue
sources." The summary above indicates that the draft FY14-15 General Fund budget is
balanced as required.
A reconciliation from the draft version presented to City Council on June 3, 2014 to the
proposed FY14-15 General Fund budget with an explanation of the changes follows.
6-3
PROPOSED FY14-15 BUDGET
June 17, 2014
Page 3of4
,1::~;::11::;.1:@1:::1;11;rr1::~::1]::@1r111:11::1:::1::1:~1fil:::1;11®11?1::fil5.;e::11:1;:1;::::::::111:1,:::rf:rI::~;mm::ili:11:;:1i:rnm:r,m::::r:;1;:::::i;11:1~!-111:1:::@~111it:BJ!:11:::::::::fil:::::::::::m11:::::1::\!:\~~~1
iJune 3, 2014 Draft FY14-15 General Fund Net Activity : $ 186 $ 61,895 • $ 62,081 .•
,-.--c-c"'-cr·-~c~·~ec'-~~r~~.,-~-.c'C<<" ,. •·'-"""•"•n-•••--•<-<~'-••••'<•••••«••••••~••••« .. •••• ~••«•••••-•••••••·•-........ · .....•....• •-.···-···•_, . ._._ ••••• ••••• -• •-•······-··• •-'( --, -•· •·• • "'''''
Impacts to the June 30, 2014 Estimated General Fund
Reserve
............................... _. ........ « ... -------------··--
Interest Earnir:ig~----_
:Council Liaison Staff Position
Animal Control Contract ....... -· ........ .
LA-RICS Administration Fee
330
' (~2,_790)
5,000
. j~,-~_qq).
LQ!b.~! .. ~~~-~1§~-~L~.~.s. ......... ····--····-. . . .. . 5_~goo . :
!open Space Fuel Modification ; 30,000
:--··-·-----~~-~-·-········---·------·-····"······· .. ·············--··· .. ·····························.: .. ·····-······--···--.. --· y--·· , ...... .
_ 1_5-9!7-.69.
330.
(~~,}QC)):
5,000
(4,300)·
·• ·~---~-. ··~ ·~I
30,000.
. ' . '"' ., .. ·~"'
! Decrease of Reserve Threshold (50% of net expenditure! :
!decreases) ! • 1,500 • 1,500 · l-~-~•JJ-i111r1!1:m~1:~:1:11:r1mm1:1:111fil:::::~m1.m1:~1
A description of the changes made since the June 3rd draft budget (detailed in the
schedule immediately above) follows:
• On May 2Qth the City Council approved a FY13-14 budget adjustment for the Zone
2 EIR ($29,472), and on May 29th the City received a property tax administration
fee settlement from the County ($180,232). Both of these items were received too
late to be included in the June 3rd draft budget document, yet impacted the
estimated General Fund Reserve at June 30, 2014 by a net amount of $150,760.
As a result of those impacts, the estimated General Fund interest earnings for
FY14-15 was adjusted by $330.
• On June 3, 2014, the City Council authorized the addition of a Council Liaison staff
position.
• Once again, the City received updated information from Los Angeles County that
resulted in an adjustment to the estimated cost of the FY14-15 Animal Control
contract. ·
• On June 2, 2014, the Los Angeles Regional Interoperable Communications
System (LA-RICS) Board approved a funding plan that would require the City to
pay a FY14-15 administrative fee of about $4,300.
• The City recently received a lawsuit settlement resulting from the 2009 Portuguese
Bend Fire. With the lawsuit settlement completed, expenditures for Other Legal
Services is expected to decrease in FY14-15. Additionally, based upon a recent
review of actual expenditures incurred during FY13-14, it appears as though the
cost of specialized contractual services, with third party legal advisors associated
with prosecution, labor negotiations and other litigation will be less than expected.
Therefore, the budget for Other Legal Services was reduced to $110,000 for FY14-
15, a reduction of $55,000. Expenditures in this account of the Legal Services
program are for the services provided by law firms other than Richards, Watson &
Gershon.
• Staff re-analyzed the Parks, Trails & Open Space Maintenance budget within the
6-4
PROPOSED FY14-15 BUDGET
June 17, 2014
Page 4of4
General Fund, and determined that the FY14-15 estimate for open space fuel
modification could be reduced, as actual costs in recent years have been
significantly less than the budgeted amount.
Staff recommends the City Council adopt the attached Resolution, approving the
proposed operating and capital budget for FY14-15. The City Manager's Budget
Message will be included in published FY14-15 budget document.
Attachment:
RESOLUTION NO. 2014-_, A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF RANCHO PALOS VERDES APPROVING A BUDGET APPROPRIATION AND
ADOPTING THE OPERATING AND CAPITAL IMPROVEMENT BUDGET FOR FISCAL
YEAR 2014-2015.
Proposed FY14 .. 15 Budget (Note: posted on the City's website on May 23, 2014)
6-5
RESOLUTION NO. 2014-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO
PALOS VERDES APPROVING A BUDGET APPROPRIATION AND
ADOPTING THE OPERATING AND CAPITAL IMPROVEMENT BUDGET
FOR FISCAL YEAR 2014-2015.
WHEREAS, on June 17, 2014, the City Council conducted an advertised Public
Hearing to receive public input regarding the proposed budget for FY14-15;
BE IT, THEREFORE, RESOLVED BY THE CITY COUNCIL OF THE CITY OF
RANCHO PALOS VERDES:
Section 1: That a revenue and expenditure/expense budget is hereby adopted. The
adopted budget, by fund, is per Attachment A with a total Estimated Ending Fund Balance
of $29,448,531 for all City funds as of June 30, 2014, exclusive of the City's Improvement
Authority.
A. The City Manager is authorized to transfer certain Budget Appropriation
Balances within functions and/or programs when deemed necessary to do so in
accordance with Chapter 3.32 of the Rancho Palos Verdes Municipal Code.
B. City Council approval will be required for any significant changes involving
increased or decreased service levels.
C. The Director of Finance shall be responsible for constant monitoring of the
budget and shall establish and implement appropriate control mechanisms necessary for
said purpose, after approval by the City Manager.
Section 2: The FY14-15 Revenue Budget is hereby adopted, establishing the
following revenue and internal service fund contribution levels:
6-6
GENERAL
BEAUTIFICATION FUND
-·--·-"""'""" ··----
CIP
STREET MAINTENANCE .---·--. ,
.•1972ACT
'EL PRADO LIGHTING -........... .
CDBG
1911ACT
'WASTE REDUCTION
--- -• - -c -~ .••
AIR QUALITY MANAGEMENT
. PROPOSITION C
,,. -.-.,,, .·.-.. · ... · .... · .. · ..
; PROPOSITION A
•PUBLIC SAFETY GRANTS
.MEASURER
HABITAT RESTORATION
:SUBREGION 1 MAINTENANCE "' " ... ' ... . '" ~ -·•·. -'"." ' . ., --... .,_ ·-.... --..
;MEASURE A
i ~.B..~~Qtll.E. .<;Q'!.E. .. ~ E.Vl/E.~ .. [) I ~!~I ~T
GINSBURG CULTURAL ARTS BUILDING
---. - ---·-~ -------· ~ ,-, ---<•.· -. ,.-••
·DONOR RESTRICTED CONTRIBUTIONS
QUIMBY
AFFORDABLE HOUSING IN LIEU
. $26,!)48,561
690
557,883
1,125,262
258,140
.. . . .. .. . .. ~,.9.Lj.9
197,687 :
528,500
222,800
50,210
612,Lj.79
737,443 ..
100,040
4E)0,2.73 .•
4,690
1,700
-· .. ---
10?~~00
... 55,~E)O ·
260
1,850
827,924
1,090
'EN.'JIRON.N1EN!J\~ .. ~~~1~.E. TAX 297,579 ·
:WATER QUALITY/FLOOD PROTECTION 1,356,200
·:a.1JBIJll§it4i:l::ii!il!ii.ll:il;il::11lill,l::::::·,.:::::,::1a&J.1'.*1:· .
. EQUIPMENT REPLACEMENT
•• ·---.•• - ---. --. --•• -• ------.. -~-----c-c. ----
. $ . 894,5()() .·
BUILDING REPLACEMENT 2,100 ·-...... ., .................... ····--
:EMPLOYEE BENEFITS 2,151,690
i&lili!IE'.iillllil§!lll;Rlliili:::l::i:m:::1:1::::::;:11::tlilH::::l'''l::.:::i1Eill
Section 3: The FY14-15 Budget is hereby adopted, establishing the following
transfers into the following funds:
GENERAL
CIP
STREET MAINTENANCE
HABITAT RESTORATION
''" .......... -
$ 208,000
9,403,806
1,096,000
157,000 -· ... -.
SUBREGION 1 MAINTENANCE 46,000
ABALONE COVE SEWER DISTRICT 50, 700
WATER QUALITY/FLOOD PROTECTION 820,000
~iill'Pii!ll!li,·iiiilili,~N:.· ·. · ·, · : : : . ~l~~~ii··
Section 4: The FY14-15 Budget is hereby adopted, establishing the following
transfers from the following funds:
6-7
GENERAL
'BEAUTIFICATION FUND
. .... -·-·· .. ------·~----··----
:CIP
;1972ACT
1911ACT --... '·-· .... -. ......... -
, WASTE REDUCTION
: PROPOSITION C
PROPOSITION A
PUBLIC SAFETY GRANTS
MEASURER
• MEASURE A
iQUIMBY
-----·-·····--------:
. $ 7,584,506.
2~4!900.
820,000
200,000
99,000
50,000 .
691,000
.. LJ:8,000
100,000
' .... '.
1,009,000
105,000 .
83~,000 .
'ENVIRONMENTAL EXCISE TAX , 100,000
1•111-11111111:111:::::1:::::::::::::::::::::::11::::::::::::::::::::\::::::::::,::·:::::::::1:;::;:::1:::.:::::::·::1:::::1:11111~1:.:.
Section 5: The FY14-15 Operating and Capital Improvement Budget Programs are
hereby adopted, establishing the following allocations.
6-8
qty_Cou_ri~il ....
~ 9~Y l\/l~n~~~.r.
• .. ~~~a..1.~eryi_c~~
.C:ityCl~r~
Coml!lunity 9lJ_treach
RPVTV
Ris~ l\,llana~~n1~.nt .
•Personnel
Finance
------··--------·-·---·····'"-~"-··---·· ----. -·., -
! __ 1_r:ifc:>~111a..~ic:>.n..T~~~-11c:>!~.~-·(~.g~t.a. ................. .
; Information Technology -Voice
,··•· ······c··········•""'' •· ····~·-,········-,.c·,··.-..c···, ·c-··,· -.,
:_pllb.l_ic ?a.f.E!_ty~ -~~~r_if.f.S~ryices ..
Animal Control
; ~~e,E~~i:1~'l.~T~P1lr~.9n.~.~~ ...... .
! Public Works Administration
~tc:>~lll.\J\f~t~~gl_J~_li!y ...... .
• ~.u.~_IJ~ BlJ.il.di n..~. IVlai n.tE! riari.~~
•Parks Maintenance
Sewer Maintenance -... ,. ................................... .
~1.a.n.n. ill~... . . .. . . .. .
: B.lJil_cjif1~.&.~~~-!Y.?~.rvices
View Restora_ti~_rlf~rE!.s~rya!ic:m ..
.'=1~.()!c:>~W .. -·
: Recreation Administration
-'• ,._.,. _ _.,,. ............. ., ........................... .
:Recreation Facilities
!~P.~~i~i-~Y~~~s ............ :·:~ ~--· ....... . .... .
;P,t Yi~~~!~ !!!!.~r.E_r~tiv~ Cen_te_r (~YI.~)
·REACH
$ 129,800
1,098,000 .......... --·
990,000
485,750
128,099
.. 168,6()()
400,000.
438,250
1,~17,000
594,_800 •
96,,ooo
.. 4:,~Q§,9-()()
9-6,790 .•
..... 8Q~999.
.. ~(;9-,~00
-~' 2~2, 250 .
?~_(;, Q()() ..
49§,_ooo ..
. §12,_3.()()
1,~_3.1,100 .
68,000
1_,505,040
749,100
218,700
JS.~~7()()
150,,Q()O
§§5-!.~s.q
52~,_500
93,250;
••<<•<•••<••<M-<<<••<<<
445~3?0.
.4:?,~0Q
: Recreation Support Services . . . 49,500
lliti!ii;llilrl:illililliili.liii::::::-::-:::·:::::'::·:.:':::,.::·:::::::1·::::::,,::::1:'·.:::::.·:,::_,;,1•11ili::.
Street Mair,i~e.nance -Pavement Management $ 574,500
Street Maintenance -Non-Pavement 1,782,579
Traffic signal maintenance 109,000
ii,IQrllillli:llililRll:'illl·llii.l&li::::,::·.iJ,,:·ililitt~i
6-9
CIP
1972ACT
•EL PRADO LIGHTING
·. -· .... ~.. . . ·-. --.. ·--· . . . . -. --. - - -. -... _.. -
•CDBG
1911ACT
WASTE REDUCTION
AIR QUALITY MANAGEMENT
PROPOSITION A
HABITAT RESTORATION
SUBREGION 1 MAINTENANCE
$ 8,835,000 -... ... . ...
78,300
1,000 ------
197,687
~9,1 00
17?,.6.5-0
50,000
596,823
.159,6?9
... ~7,_500 .'
1 .~.B~.~9r-.J.~.~9Y.~ .~~\/Y~~.P.~~T~.1~!_ .... .. .. . ......... -· ....... ..195-! 1oq
]WATER QUALITY/FLOOD PROTECTION . 2,304,996
:111ix1&m•1r111.1•m1m-11a1111:1:::·:·:::::.·:.:,,:::• .• 1.·:,•1:111miB·:::·
r•·c-·--•r·••
$ . ~,013,58?
:EMPLOYEE BENEFITS 2,151,450
1ililit4i~Aii'iill:iiiil•l.iiill:::::::::r:::1;::::::;::11:::::;,:;,:;,.:::::::::::1::::::illllB::::•.
\ltitiiIBlflmlllli,lliJ:j[li1i!•:1:•:•:m::t::::::::j::::::::::::::::,:1:::1:::::::::1::::::::::t\1:•i::::::[:::::::::::,:::::::::•l;IJ[li!~B::::
PASSED, APPROVED and ADOPTED the 17th day of June 2014.
ATTEST: MAYOR
CITY CLERK
State of California )
County of Los Angeles )ss
City of Rancho Palos Verdes )
I, CARLA MORREALE, City Clerk of The City of Rancho Palos Verdes, hereby certify that
the above Resolution No. 2014-_ was duly and regularly passed and adopted by the said
City Council at regular meeting thereof held on June 17, 2014.
CITY CLERK
6-10