Resolution No. 2023-010RESOLUTION NO. 2023-10
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VERNON
ADOPTING THE APPROPRIATIONS LIMIT FOR FISCAL YEAR 2023-
2024, PURSUANT TO GOVERNMENT CODE SECTION 7910
SECTION 1. Recitals.
A. Government Code Section 7910 (GANN initiative), passed by California voters on
November 6, 1979, requires the governing body of each local jurisdiction to establish by
resolution an appropriations limit for each fiscal year.
B. Proposition 111 was passed by California voters on June 5, 1990, and sets forth
the options for making annual adjustments to the appropriations limit based on various
growth factors. The annual inflation factor may be either the growth in California per
capita income or growth in non-residential assessed valuation due to new construction
within the City; and the population factor may reflect the population growth either in the
City or in the County of Los Angeles.
C. The City calculated its appropriations limit based on the non-residential assessed
valuation due to new construction as its annual inflation factor and the County’s
population growth as its annual population growth factors for Fiscal Year 2021-2022,
2022-2023, and 2023-2024.
D. The documentation used in the determination of the appropriations limit has been
made available for inspection by the public at least fifteen (15) days prior to the hearing.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
VERNON AS FOLLOWS:
SECTION 2. The City Council of the City of Vernon hereby finds and determines
that the above recitals are true and correct.
SECTION 3. The City Council hereby establishes $2,626,172,281 as the amount
of the appropriations limit for fiscal year 2023-2024, in accordance with the provisions
of Government Code Section 7910 and Proposition 111.
The computation for fiscal year 2023-2024 is as follows:
2023-2024 APPROPRIATIONS LIMIT CALCULATION
2022-2023 Appropriations Limit $2,380,154,189
Increase in Nonresidential Construction: 11.17%
Los Angeles County population change: -0.75%
1.1117 x 0.9925= x 1.103362
$2,626,172,281
Resolution No. 2023-10
Page 2 of 2
_______________________
SECTION 4. The City Council approved the Fiscal Year 2023-2024 Budget by
adoption of a resolution, which did not exceed the appropriations limit for Fiscal Year
2023-2024.
SECTION 5. The City Clerk shall certify the passage and adoption of this
resolution and enter it into the book of original resolutions.
APPROVED AND ADOPTED June 6, 2023.
_______________________
CRYSTAL LARIOS, Mayor
ATTEST:
LISA POPE, City Clerk
(seal)
APPROVED AS TO FORM:
_____________________________
ZAYNAH N. MOUSSA, City Attorney
I CERTIFY THAT RESOLUTION NO. 2023-10 was passed and adopted by the City
Council of the City of Vernon at the Regular Meeting on June 6, 2023, by the following
vote:
AYES: 4 Council Members: Lopez, Rivera, Merlo, Larios
NOES: 1 Council Member: Ybarra
ABSENT: 0
ABSTAIN: 0
________________________________
LISA POPE, City Clerk
(seal)
City Council Agenda Report
Meeting Date:June 6, 2023
From:Scott Williams, Director of Finance
Department:Finance
Submitted by:Angela Melgar, Finance Manager
Subject
Citywide Annual Operating Budget, Capital Improvement Plan, and Appropriations Limit (Gann)
for Fiscal Year 2023-24
Recommendation
A. Adopt Resolution No. 2023-09 approving and adopting the Annual Operating Budget and the
Capital Improvement Plan for Fiscal Year 2023-2024; and
B. Adopt Resolution No. 2023-10 adopting the Appropriations Limit for Fiscal Year 2023-2024
pursuant to Government Code Section 7910.
Background
Fiscal Year 2023-24 Operating and Capital Budget
In preparation for the upcoming Fiscal Year (FY) 2023-24 Budget adoption, staff facilitated two
separate Budget Workshops to present the proposed budget and allow City Council to gather an
understanding of the City’s operations and intended fiscal direction, and staff’s plan to address
Citywide issues, functions, and needs. Because each department faces unique challenges and
identifies its own specific goals, collaboration between Finance and the individual departments
was required in the weeks preceding workshops. The current economic environment has
presented additional complexities this year. With an outlook of persistent inflation, rising interest
rates, banking turmoil, and softening business investment activity, a concerted effort by
management was required to determine expenditures that could be deferred and cost savings
that could be realized, while also focusing on current revenues and potential new income
sources.
The May 2, 2023 Budget Workshop I focused on the previous year's highlights and the vision for
the City departments as they move forward into the new fiscal year. Council provided initial
feedback and requested to see different scenarios related to the Wellness Equity Alliance (WEA)
health services model. The City Administrator and Finance Director continued to work with all
departments to find areas for additional cost savings and increased revenues during the weeks
that followed.
On May 16, 2023, staff presented Budget Workshop II which covered the changes in General
Fund and the Enterprise Funds from the previous version of the budget presented to Council,
and focused discussion on the revised iteration; and, the Director of Health and Environmental
Control along with the Public Health Officer presented different implementation options for WEA
services. Council made further recommendations to increase the CommUNITY Promotion
budget, specifically the budget for grants to non-profit organizations and scholarships. For WEA,
Council directed an implementation of the “full” core public health services and “reduced”
community health services.
For deliberation at its June 6, 2023 meeting, Council is presented with a proposed FY 2023-24
Citywide Budget that incorporates the modifications requested by Council over the course of the
City’s May budget sessions, and any additional feasible expenditure reductions identified by staff.
Adoption of Resolution No. 2023-09 approves the Citywide Annual Operating Budget and Capital
Improvement Plan.
Gann Limit
California voters approved an initiative on November 6, 1979 that added Article XIIIB to the State
Constitution, which placed limits on the amount of revenue that can be appropriated by all entities
of government. This State Appropriations Limit is often referred to as the Gann Limit (Gann),
named after Paul Gann, the author of the measure placing the limit in the State constitution. In
accordance with that legislation, the governing body of each government jurisdiction must, by
resolution, establish its annual Appropriations Limit for the coming year at a regularly scheduled
meeting or noticed special meeting.
The original Article XIIIB (Proposition 4) and its implementing legislation, Chapter 1205/80, was
modified in June 1990 by Proposition 111 and SB 88 (Chapter 60/90). As a result of Proposition
111, the City is required to choose between two annual inflation factors: (1) the growth in
California per capita income; or (2) the growth in non-residential assessed valuation due to new
construction within the City; and two population factors: (1) the growth in the City; or (2) county
population. For the FY 2023-24 Gann appropriations limit calculation, the growth in non-
residential assessed valuation due to new construction within the City and the percentage growth
in County population was used, which has been the same method used since FY 2017-18.
The City’s appropriations subject to the limit have remained well below the Gann Appropriations
Limit. Given the size of this gap, it is unlikely that the City will exceed the Appropriations Limit in
the upcoming years without significant changes to the City’s tax structure. The documentation
used in the determination of the appropriations limit has been made available for public inspection
on the City’s website at least 15 days prior to adoption. Adoption of Resolution No. 2023-10
adopts the Appropriations Limit for Fiscal Year 2023-24 pursuant to Government Code Section
7910.
Pursuant to Government Code Section 65090, on May 25, 2023, the public hearing notice was
posted at City Hall, City‘s website and published in the Los Angeles Wave (Huntington Park
Bulletin) (Attachment No. 4).
Fiscal Impact
The Fiscal Year 2023-24 Budget proposes total expenditure appropriations of $369,067,754
which is well under the $2,626,172,281 appropriation limitation imposed pursuant to Gann.
Attachments
1. Resolution No. 2023-09
2. Resolution No. 2023-10
3. Gann Limit Calculation
4. Public Hearing Notice