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20200407 Regular City Council Meeting - Packet (4)4 O F. �LtiELy SMDu 04-07-20 Item No. 2 Staff Presentation i Fiscal Year 20 C. or �`l,,,q� Bud et Wor \1"eo � let I I April 7,2,020;. %L j,. , �� , L�- CF V v G$LtiF'LY SM�ub Strategy Long -Term Strategy Short-Term Strategy I ` • Fiscal Accountability.,. � Y� • Sustainabilit • Operational Efficiency 1 0 � r I • Management of Uncertainty � 4 o F. �LtiELy SMDu tr t rDefic SucuaI $5.0 $(5.0) $(10.0) $(15.0) $(20.0) $(25.0) $(25.1) $(30.0) $(24.8) it $(23.0) General Fund Balance $(10.9) $(15.6) 2012 Audited 2013 Audited 2014 Audited 2015 Audited 2016 Audited 2017 Audited 2018 Audited 2019 Unaudited CF vFR �CG$LtiFLY S1fVV4R�ti ER Fud ExpendituresnGeneral CATEGORY SALARIES BENEFITS SUPPLIES/SERVICES CAPITAL GRAND TOTAL FY 2019-20 BUDGET $20,705,740 14,076, 604 24,351,248 5,663,000 FY 2020-21 PROPOSED $20,825,680 15,01 1,446 25,074,715 7,717,360 $64..796..592 $68,629,201 INCREASE/ (DECREASE) $119,940 934,842 723,467 2,054,360 $3,832,609 0 CF vFR �CG$LtiFLY S1fVV4R�ti ER Fud ExpendituresnGeneral • $119..940 increase in Salaries/$934,842 increase in Benefits • Current MOUs in place and step increases • Pension and OPEB cost increases • $723..467 increase in Supplies/Services • One-time Fire Department conversion costs to Los Angeles County increase in Professional Services costs $1,619,818 netted against other departments' decreases in supplies and services costs • $2,054,360 increase in Capital • One-time Fire Department conversion costs to Los Angeles County paying off two engines and a tractor drawn aerial lease $1,780,160 • EnerGov software, customization and migration ERP $900,000 • Netted against other departments' decreases in capital �� c t IOaAy 4 ��BLY SM�u General Fund Revenue Federal Emergency Assistance, $1.5 , 2% Overhead allocation (Enterprise overhead costs), $3.7 , 5% In -lieu tax (Vehicle License Fee transfer), $5.3 , 8% Other revenues (Insurance recoveries), $1.2 , 2% Charges for services, $1.3 , 'x/ 2% 1 Intergovernmental revenues (Grants; Stormwater), $2.5 , 4% Licenses and permits, $1.8 ,3% Total Revenues: $68.6 M Special assessments (Parcel tax), $1.2 , 2% Reserves Applied, $2.9 , 4% Taxes (Property, Sales, UUT), $47.1 , 68% �� c t IOaAy 4 ��BLY SM�u Fund General RDA Debt Service, $5.9 , 9% Vernon Promotion, $0.5 , 1% Community Development, $0.5 , 1 % Capital outlay, $7.7 , 11 % Health services, $1.5 , 2% Public works, $8.2 , 12% Total Expenditures: $68.6 M General government, S14.9 .22% Public safety - Police, $12.0 , 17% Public safety - Fire, $17.4 , 25% \l ER General Fund Category Definitions • Taxes ✓ Property taxes ✓ Sales and Use taxes ✓ Utility User Tax ✓ Special assessments and parcel tax • Licenses and permits ✓ Business License ✓ Building and Planning, Health • Intergovernmental revenues ✓ Grants for public safety ✓ Stormwater cost recovery • Reserves Applied • Federal Emergency Assistance • Charges for services ✓ Inspections, plan checks, etc. • Other revenues ✓ Insurance recoveries • Sale of Property • In -lieu tax ✓ State Vehicle License Fee transfer • Overhead allocation ✓ Administrative support for City services • RDA/Successor Agency Debt Service ✓ Bond Repayment CF vFR E R �CG$LtiFLY S1fVV4R�tiNL=MZ Enterprise Funds Expenditures CATEGORY SALARIES BENEFITS SUPPLIES/SERVICES CAPITAL FY 2019-20 BUDGET $8,211,565 3,344,412 232,154,560 21,163,000 FY 2020-21 PROPOSED $8,416,626 3,605,580 225,232,356 18,983,685 INCREASE/ (DECREASE) $205,061 261,168 (6,922,204) (2,179,315) GRAND TOTAL $264..873..537 $256..238..247 ($8,635,290) CF vFR �CG$LtiFLY S1fVV4R�ti ER Enterprise Fund Expenditures ($6,922,204) decrease in Supplies/Services • Measure R VPU Credit Program sunset reduces expenditures by ($8,456,257) • Purchased water expected to decrease ($385,000) • Netted against other departments' increases in supplies and services costs ($2J 79,,315) decrease in Capital • Completion of several Water Fund well project phases decreases expected expenditures ($1,997,162) • Completion of Gas Fund Loop over 26'" Street Bridge Project decreases expected expenditures ($600,000) • Netted against other departments' increases in capital �� c t IOaAy 4 ��BLY SM�u Enterprise Fund Revenue 15 ----- s— , Total Revenues: $256.2 M �� ctlO�y 4 �tBLY 04 Enterprise Expenditures Non -Operating Expenditures - In -lieu tax, $5.3 , 2% Non -Operating Expenditures - Overhead allocation, $3.7 , 2% Capital outlay, $18.9 , 7% Interest payment, $15.2 , 6% Principal retirement, $29.5 , 12% Total Expenditures: $256.2 M Reserves Applied (Electric 8� Water), $0.8 , 0% Cost of sales, $183.4 , 71% CF vFR �CG$LtiFLY S1fVV4R�ti ER Enterprise Fund Category Definitions • Proceeds from Long -Term Debt ✓ New bond issuance and refinancing • In -lieu Tax ✓ State Vehicle License Fee transfer • Interest Payment ✓ Interest on bond payments • Reserves Applied • Overhead Allocation ✓ Administrative support for City services • Cost of Sales ✓ Cost of sale of all utilities • Principal Retirement ✓ Repayment of bonds and reduction of debt �� c t IOaAy 4 ��BLY SM�u ProposedBudget Highlights • Majority of expenditures retained consistent with FY 2019-20 • Continued response to the COVI D-19 emergency • Transition to Los Angeles County Fire • Final disposition of Legal Department • Issuance of Water Fund bonds • Current MOUs in place CF VV G$LtiF'LY SM�ub Departmental Changes Department FY2019-20 City Council $207,928 City Administration $944,540 City Clerk $598,635 Human Resources $3,481,899 Police $1 1,159,721 Fire $17,660,891 Information Technology $2,418,008 Health & Environmental 1,418,337 Control $ Proposed FY2020-21 Change $219,888 $1 1,960 $985,213 $40,673 $600,700 $2,065 $4,849,073 $1,367,174 $1 1,794,907 $635,186 $19,229,370 $1,568,479 $3,476,961 $1,058,953 $1,535,455 $1 17,1 18 CF vFR �CG$LtiFLY S1fVV4R�ti ER Departmental Changes Department Community Promotion Community Development Industrial Development Finance City Attorney Public Works FY2019-20 $500,000 $500,000 $51,230 $3,354,999 $1,555,589 $15,035,120 Proposed FY2020-21 Change $500,000 $0 $500,000 $0 $51,480 $250 $3,107,360 ($247,639) $1,573,007 $17,418 $14,097,959 ($937,161) Vernon Public Utilities $262,373,536 $256,238,247 ($6,135,289) CF vFR e )IER �CLs,tii"LY St4Vu4R Departmental Changes Finance Department - Decrease of $247,639 • Reduced supplies and services costs due to completed projects City Attorney - Increase of $17,418 • Increase to salary and benefits Public Works - Decrease of $937,161 • Decrease based on supplies and services and timing of capital outlay Vernon Public Utilities - Decrease of $6,135,289 • Decrease in cost of sales, supplies and services and debt service savings Community Development, Community Promotion, Industrial Development and City Clerk 9 Budgets are essentially net neutral �� c t IOaAy 4 ��BLY SM�u Departmental Changes City Council - Increase of $11,960 • Increase to salary and benefits City Administration - Increase of $40,673 • Increase to salary and benefits and regulatory advocacy firm Human Resources - Increase of $1,367,174 • Increased retiree medical premiums, OPEB expense and increased salary expense due to moving Senior Legal and Policy Advisor to department CF vFR �CG$LtiFLY S1fVV4R�ti ER Departmental Changes Police - Increase of $635,186 • Capital outlay for communications upgrade and pension increases Fire - Increase of $1,568,479 • Due to step increases based on current MOUs, increased pension costs and one-time transition costs to Los Angeles County Information Technology - Increase of $1,058,953 • First phase of ERP system upgrade and other compliance technology upgrades Health &Environmental Control -Increase of $117,118 9 Based on additional required position for mandated inspections (Measure W funded) VER a Staffing Changes Major City Functions/FY 2015 2016 2017 2018 2019 2020 General Government 36 36 38 40 37 37 Fire 70 74 70 65 65 53 Health 9 10 11 9 4 4 Police 54 52 56 53 53 55 Public Utilities 55 54 60 60 55 52 Public Works 38 38 40 43 45 36 Totals 262 264 275 270 259 237 Percentage Change from PY 0.8% 4.2% -1.8% -4.1 % -8.5% CF vFR �CG$LtiFLY S1fVV4R�ti ER Timeline May 19, 2020 Consideration of User Fee Schedule June 2, 2020 Budget public hearing Approval of GANN Approval of personnel resolution July 1, 2020 Effective Date of FY 2020-21 Budget 4 ��BLY SM�u Questio