CITY OF COMMERCEAGENDA REPORTCITY OF COMMERCEAGENDA REPORT
CITY OF COMMERCE
AGENDA REPORT
CITY OF COMMERCE
AGENDA REPORT
Item No. Item No.
Item No.
Item No.
TO: Honorable City Council
FROM: City Manager
SUBJECT: A Resolution Authorizing the Continuing of Operations into Fiscal Year 2024-25 at the Amended Fiscal Year 2023-24 Appropriation Levels with Contractually Required Adjustments Meeting Date: June 25, 2024
RECOMMENDATION:
Approve and adopt the proposed Resolution authorizing the continuing of operations into Fiscal Year 2024-25 at Fiscal Year 2023-24 amended appropriation levels with adjustments for needed items and contractually required increases and/or decreases, and assign the number next in order.
BACKGROUND/ANALYSIS:
Normally the City’s budget process would begin in April or May with meetings between the various City Departments, Finance and City Administration. Staff then would hold a study session with the City Council in May to review progress on the budget and get further direction. The final plan would be presented to the City Council for consideration typically in June. However, various circumstances have contributed to a recommended modification of this year’s budget process.
Because the City brought on a City Manager in early May, adopting a status quo budget in June is recommended. Doing such, will provide time for the new City Manager to familiarize himself with the City’s budget and programs so he can make an informed decision when presenting and engaging with the Council regarding the City’s budget that will govern spending during the next fiscal year. This year’s plan will be for the Assistant City Manager to work with the City Manager and City staff over the summer months to develop a budget update report. City Council will be presented with the budget update report no later than September.
Given these circumstances, staff is recommending the FY 2024-25 budget be adopted based on the amended FY 2023-24 budget (on September 12, 2023) with adjustments for needed items and contractually required increases and/or decreases. This would mean that the programs and costs reinstated during FY 2023-24 would continue in the proposed FY 2024-25 operating budget.
The FY 2024-25 proposed budget includes expenditures of $70,074,927. A snapshot of how we got here since last fiscal year:
June 27, 2023 -- An initial General Fund budget was adopted $63,962,083 July 18, 2023 – Wage & benefit (inclusive of Class and Comp) $ 3,573,200 September, 12, 2023 – Additional positions approved $ 1,543,127 July 1, 2024 – Employee Wage increase $ 1,235,750
Adjusted Baseline Budget ($ 1,500,000) Projected costs related to Public Safety / Public Works Contracts and Utilities $ 1,116,070
TOTAL $70,074,927
As noted at the beginning of this report, the Assistant City Manager will work with the City Council and City staff over the summer months to develop a budget update report.
ALTERNATIVES:
Approve staff recommendation
Provide staff with further direction
FISCAL IMPACT:
Staff will return to the City Council with a budget update report including projected FY 2024-25 revenues sometime in September. Moving some of the budget process to the summer will provide time for the new City Manager to become familiar with the budget and budget process.
Other funds that the City Council needs to take action on are as follows:
Fund 22 – COPS Grant $ 100,000
Fund 25 – Proposition A $1,425,000
Fund 26 – State Gas Tax $ 673,699
Fund 29 – CDBG Fund $ 136,277
Fund 33 – Community Assistance $ 420,000
Fund 42 – Community Ctr. Debt Svc $ 777,300
Fund 45 – Pension Obligation Bonds $ 625,200
Fund 50 – Water Utility Fund $1,857,247
Fund 57 – Transportation $6,825,300
Fund 58 – CNG $2,100,000
Additionally, events over the coming months could potentially shed some light as it relates to economic risks that could impact the City’s budget. The potential for economic instability and/or continued inflationary environment could be a factor depending on November’s election results is another reason to approach this year’s budget process with caution and pragmatism.
RELATIONSHIP TO STRATEGIC GOALS:
This report is applicable to the following 2016 Strategic Plan Fiscal Sustainability Guiding Principle 1: Demonstrate fiscal responsibility through establishing financial policies, budgeting practices that meet the Financial Standards of Excellence requirements.
Recommended by: Vilko Domic, Assistant City Manager
Approved as to form: Noel Tapia, City Attorney
Respectfully submitted: Ernie Hernandez, City Manger
ATTACHMENT:
Resolution
Exhibit A Power Point Presentation