RESOLUTION NO. 2025-__________
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA ESTABLISHING THE APPROPRIATIONS
LIMIT (GANN LIMIT) FOR THE CITY OF CHULA VISTA
FOR FISCAL YEAR 2025-26
WHEREAS, Article XIIIB of the California Constitution, approved by the voters in 1979, imposed the concept of spending limits on local governments; and
WHEREAS, this Constitutional provision and related implementing legislation specifies that annual increases in appropriations financed from "Proceeds of Taxes" ar e limited to a base year (1978 -79) amount increased annually by an inflation factor comprised of the change in population of the city combined with the greater of the change in new non -residential construction or the change in the California per capita personal income (“Appropriations Limit”); and
WHEREAS, by definition, "Proceeds of Taxes" includes such revenues as property taxes, sales and use taxes, utility users taxes, transient occupancy taxes, and state subventions; and
WHEREAS, revenues from other sources like fees/charges and federal grants are considered "Non-Proceeds of Taxes" and are not subject to the annual spending limit; and
WHEREAS, this calculation has always been perfunctory for the City of Chula Vista (“City”), since the proceeds of ta xes for the City are far less than the statutory Appropriations Limit; and
WHEREAS, the State Department of Finance and the San Diego County Assessor's Office are charged with providing the data necessary for local jurisdictions to establish their Appropriations Limit; and
WHEREAS, according to these sources, for purposes of the fiscal year 2025-26 calculation, the population increased 0.19 percent; and
WHEREAS, California per capita personal income increased by 6.44 percent and new non-residential cons truction increased by 3.85 percent. C onsequently, California per capita personal income change was used in the formula to compute the Appropriations Limit as this increase is the greater of the two amounts; and
WHEREAS, the fiscal year 2025-26 Appropriations Limit has been calculated to be $1,452,743,519; and
WHEREAS, the "Proceeds of Taxes" as included in the fiscal year 2025-26 Proposed Budget that are subject to the Appropriations Limit are estimated to be $239,352,012; and
Resolution No.
WHEREAS, the City has what is referred to as an appropriation "gap ” of $1,213,391,507 ($1,452,743,519 - $239,352,012) (“Appropriation Gap”); and
WHEREAS, as a result of this Appropriation Gap the City may collect and spend up to $1,213,391,507 more in taxes during fiscal year 20 25-26 without exceeding the Constitutional limit.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista does hereby establish an Appropriations Limit of $ 1,452,743,519 for fiscal year 2025-26 pursuant to the requirements of Article XIIIB of the California Constitution and California Government Code section 7910.
Presented by
Approved as to form by
_________________________________ _________________________________ Sarah Schoen Marco A. Verdugo
Director of Finance/Treasurer City Attorney