Proposed
Budget
Fiscal Year
2022/23
§ Presented By:
§ Damien O’Bid, City Manager
§ Angela Courter, Director of Admin Services
City of Cotati
City Council Session June 28, 2022
November-December - City Manager
and Admin. Services Budget Planning
Meetings
January -Mid-Year & Financial Performance
Review
February - Budget Strategy Meetings,
Budget Guidelines Drafted March - Internal Budget Review, Strategic/Long-Term and Capital Planning
April - Draft Budget Creation and Review
April-May - Budget Workshops
June - Budget Adoption
Strategic Planning
Session
•Developed City
Objectives/Goals
Budget Focus
•Strategic Projects
Feb. 15,
2022
City Objectives
Revisit
Budget Study
Session
•General Fund
•Revenues
•Expenditures By
Departments
•Special Revenues
April 19,
2022
Budget Study
Session
•Enterprise Funds
•Capital Projects
•Transfers In and Outs
May 17, 2022
Budget Adoption
June 28,
2022
Long Term Vitality
•Balanced Budget
•Economic Development
•Affordable & Proper Development
•Infrastructure Preservation
•Pursue Grant Opportunities
Climate Change
•Mitigate and Adapt to Impacts
•Wildfire Preparation & Adaptation
Community Engagement
•Inclusive and Equitable Practices
•Advance Equity to Community Partners
Equitable, Compassionate & Healthy Community
•Diversity Source of Strength
•Equity in Hiring/ Promoting/ Contracting
•Advance equity & health partnerships
Best in Class Community Services
• Community Safety & Quality
•Support High Level Core Services
•Emergency Preparedness
•Update Regulations
•Development Services
•Regional Participation
•Improve Service Delivery
Unemployment Rate*
§ The U.S. economic outlook
is still highly volatile
§ GDP for 2022 est. 3.2 % and for
2023 est. 2.1% vs. 4.1% growth
2019
§ California economy Same
Instability
§ Unemployment Peak 24.5 %
during Q2 2020
§ 9% decline in Personal Income
Summary
Unemployme
nt Rate April 2021 April 2022 Change
US 6.0% 3.6% 11.4%
California 8.3% 4.6% 11.6%
Sonoma 6.2% 2.6% 12.6%
• Sonoma County - As reported May 20, 2022 by State of CA Employment Development Department https://www.labormarketinfo.edd.ca.gov/file/lfmonth/satr$pds.pdf • US and California – As Reported June 17, 2022 by the Bureau of Labor Statistics - https://www.bls.gov/ Global/National/Regional
§ Economic Uncertainty
§ Unknown Term for Continued Inflation
§ Federal Funds Rate Increases
§ Impacts on Investments in
Development
§ Legislative Impacts from Federal, State &
Regional Government
§ Recovery from Covid-19 with Lingering
Effects
§ Inventory Shortages
§ Russian unprovoked attack on Ukraine
§ Global Sanctions on Russia
§ Increased Gas prices
§ Global interruption of goods
§ Increased military spending
• A general fund is the primary fund used by a government entity. • Used to record all resource inflows and outflows that are not associated with special-purpose funds.
• Activities being paid constitute the core administrative and operational tasks of the government entity.
Assumptions in Decline in Operating Revenues of Approximately $30K for fiscal year 2022/23
Balanced Budget - Net Operating Surplus - $1.3 M
Total Operating Revenue - $10.1 M
Total Operating Expense - $8.8 M
General Fund is Funding $3.7M in Capital Projects
Leveraging an Additional $1.2M in Grants Matching
Maximizing Low Interest Tax-Exempt Debt to Invest in Major Streets Projects Ending General Fund Balance of $4.6M
Budget reflects a total operating reserve of 53% exceeding the 25% requirement.
General FUND Budget
Highlights
Increased Expenditures
Contract Services-Insurance Debt Service Other Expense - Election Staffing Costs less than $13K Change from Budget 2022/23 Negotiated Adjustments Lump Sum Payment of PERS Increased Insurance Adjusted for $1.4 Budgeted ARPA Funds in 2021/22
Operating Revenues Increase from 2021/22 Adopted Budget 2021/22 Est. Up 7.5% 2022/23 Proposed Up 7.2%
Operating Revenues Decrease from 2021/22 Adopted Budget 2021/22 Est. Down 6.3% 2022/23 Proposed Down 6.6%
Minimum reserve of 25% of operating expenses, per Resolution 2009-50 2021/22 Estimated Reserve of 58% 2022/23 Proposed Reserve of 53%
Cotati Budget Revenues:
§ Based on best available information today
§ Estimates are always conservative
§ Sales tax and Measure G
§ Approximately 60% of General Fund Operating Revenues
§ Tax base is relatively secure
§ Projecting 2% growth due to strong demand for goods at higher prices § Primary Industries are Building/Construction, Fuel and Service Stations, Food and Drug, and the County Pool.
§ Property Tax
§ Approximately 20% of General Fund Operating Revenues
§ Increasing 2% over prior year budget due to completion of higher tax valued properties in 2019-2021 primarily Kessing Ranch.
§ Additional expected 2% Expected Assessors Applied CPI § Cannabis Tax Increasing due to additional retail permit § Includes continuation of SSU Dispatch Agreement
§ Reduction in 1x Other Revenue from FY 21-22 due to St. Joseph Park and Ride 1x revenue.
• 2021-22 - ADDITIONAL DISCRETIONARY PAYMENT OF $6M
PROCESSED ($4.8M FOR GENERAL FUND), PLUS LUMP SUM
• 2022-23 - FULL LUMP SUM PAYMENT OF THE PERS UNFUNDED
LIABILITY IN THE AMOUNT OF APPROXIMATELY $1.2M
• ALLOCATED CONTRACT SERVICES
• SHARED INDIRECT COSTS SUCH AS AUDIT FEES, JANITORIAL
COSTS, UTILITIES, ETC.
• BASED ON FULL FTE
CALPERS
•USING ESTIMATES RECEIVED
• INSURANCE ESTIMATE INCREASE 52%
• MARKET UNCERTAINTY
CONTRACT
SERVICES
EVALUATION
• ESTIMATES ARE BASED ON EXISTING STAFFING
• INCLUDES ALL NEGOTIATED MOU CHANGES
•ONE MOU CURRENTLY BEING NEGOTIATED
• EVALUATING STAFFING LEVELS
INSURANCE
INCREASES
ALL DEPARTMENTS
ARE BUDGETED AT
FULL STAFFING
City Manager includes the following changes:
Inclusion of the Public Information Services and biannual Election Charges Personnel reduced by City Clerk offset by Administrative Assistant Administrative Services includes the following changes:
Increase due to budgeting for new accountant and intern positions Community Development change is primarily due to:
Additional Part Time Permit Tech
Public Works change is primarily due to:
Increased dues and subscriptions and allocated insurance Operational Funding for Veronda-Falletti Ranch for 2nd year Police Services includes the following changes:
Continued investment in technology services through the public safety consortium
Additional Costs for Training and correlated Overtime.
Significant other expenses include allocated insurance, recruiting, small tools and equipment, and vehicle fuel.
Recreation includes the following changes:
RecDesk Annual software contract renewal
Significant other expenses include allocated insurance and bank fees Transfer In for:
COPS Grant = $100,000
Public Safety Prop 172 = $72,000
Transfer Out for:
Capital Projects Funds = $1,730,500
Grants Fund 201 = $1,875,000 (Matching
for $1,327,900 in Grants)
Successor Agency = $77,314 Allocation
Coverage
K-9 Fund = $13,840 Measure S Funding
for Program
Grant Project Summary *
Streets Quick Strike Project - $2,890,000
Kotate Park (Prop 68) - $2,387,900
*Funded by grants and city matching funds
Other City Project Summary:
Parks
Pocket Park & Putnam Park Design. - $114,500
Streets
Bench at ORH & 116 Pedestrian Plaza - $46,000
Bicycle Pedestrian Safety Improvements - $50,000
ORH Traffic Flow Improvement - $334,800
Gateway Signage - $100,000
Loretto & Marsh to McGinnis Pathway - $61,000
2023 Pavement Preservation - $1,085,000
2023 Pavement Rehabilitation - $3,200,000
HWY 116/W. Cotati Ave. Safety Imp. - $500,000
Redwood Dr & Cypress Ave Rehab - $205,000
Park & Ride Project - $2,200,000
Other City Project Summary:
Buildings
Civic Center Windows & Repairs - $1,038,000
LLAD
Altman Acres LLAD Streetscape - $25,000
Loretto & Marsh to McGinnis Pathway - $20,000
qProposed Park/Streetscape Refurbishment Allocation
q$35,000 for replacing existing park plantings
q$35,000 for replacing existing streetscape plantings
Special Revenue Funds are a group of accounts established by a government for restricted use to ensure that certain revenue sources are used or earmarked only for their specific purpose.
This Special Revenue Fund type may be used to account for the proceeds of specific revenue sources that are legally restricted or restricted by City Council policy for a specified purpose. - Other revenues are primarily Development fees for as well as RMRA funds.
By Type
- Other revenues are primarily Development fees for as well as RMRA funds.
By Fund
By Type
- Primarily expenditures are transfers out for capital projects.
Vehicle Maintenance & Replacement
§ Provides an ongoing funding source for scheduled
replacement of City vehicles from billings to other funds who are utilizing the fleet.
§ Continued Investment of $361K includes
§ Replacement of Two Police Interceptor SUV’s
§ Evaluating fuel efficient/environmentally friendly vehicles § Pending Public Works Flatbed Dump Truck Replacement
§ New Equipment- Various as needed
§ Repairs & Maintenance of Existing Fleet
Compensated Absences Fund
§ Funds compensated absences with contributions made
based on a proportionate and rational allocation of the total government wide liability.
§ Balances are increased to address estimated changes in Salaries and Benefits Schedules
Enterprise Funds are used to account for operations that are financed and operated in a similar manner as a private business enterprises, where the intent is that the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges.
Maintains a
reserve of 33% of
operating
expenses
Rate change per
the rate study
for water &
sewer
Conservative
Revenue and
Expenditures
Estimates
Continued focus
on infrastructure
improvements
and preservation
§ Operating Revenues –Rate
Increase – No significant
Connection Fees
§ Proposed Capital Project
Improvements:
§ SCADA Server Upgrade &
Relocation - $150,000
§ P-1: Portal, Mercantile,
Aaron Replacement -
$608,900
§ Changes in Operating
Expenditures:
§ Increasing Insurance,
§ Water conservation
programs
§ Water Agency Increased
Rate of 6.0%
§ Debt Service back to
General Fund
§ Operating Revenues –Rate
Increase – No significant
Connection Fees
§ Proposed Capital Project
Improvements:
§ SCADA Server Upgrade &
Relocation - $150,000
§ West Sierra Avenue
Sewer
Replacement$1,100,000
§ Changes in Operating
Expenditures:
§ Increasing Insurance,
§ Increased wastewater
treatment of 6.8%
§ Debt Service back to
General Fund
Conclusion
The Proposed FY 2022/23 Budget:
Prioritizes Community Engagement, Long
Term Vitality, Best in Class Community Service
Will continue to strive to implement more
actions towards Climate Change and Equality
Balanced Operating Budget
Operating Expenditures Do Not Exceed
Conservatively Estimated Operating
Revenues
Significant Investments in Historically
Deferred Capital Project
Fiscally Prudent
The General Fund Reserves To 53%
City staff are committed to exercise
prudence and integrity in the management
of public funds and provide transparency
and accountability in its use.