BUDGET 101
AND
GENERAL
FUND
Fiscal Year
2023/24
City of Cotati
Session Date :
April 4, 2023
1 Study Session
Overview
Tentative Schedule & Budget Basics
City Economic
Overview/Forecasting Assumptions
Staffing with Allocations
Budget Study
General Fund
Allocated Contract Services
Conclusion
Packet Provided Schedules
General Fund Workbook with
Allocated Contract Services Detail
FTE Summary and Allocations
2 Tentative
Schedule
3 Strategic Planning
Session
•Developed City
Objectives/Goals
Budget Focus
•Strategic Projects
March 7, 2023
City Objectives Revisit
Budget Study Session
•General Fund
•Revenues
•Expenditures By
Departments
April 4, 2023
Budget Study Session
•Enterprise Funds
•Special Revenue Funds
•Capital Projects
•Transfers In and Outs
April 18, 2023
Budget Adoption
May 23, 2023
Budget Development
Responsibilities
• Administrative Services
• Overall administrative responsibility for planning, coordinating, analyzing, preparing, and issuing the budget.
• Department Directors
• Preparing and submitting the budget for the department and its subsidiary divisions in accordance with the budget instructions. • City Manager
• Consultation with department directors, makes final determination of the proposed budget to be submitted for approval to the City Council. • City Council
• setting the City’s priorities and approving the annual operating budget. 4 Annual Budget
Cycle
NovemberDecember
City
Management
Budget Planning
Meetings
January
Mid-Year
Financial
Performance
Review
March
Budget Strategic
Planning
Meetings with
Budget
Guidelines
Internal Budget
Review April
Draft Budget
Creation and
Review
Public Budget
Workshops
May/June
Budget
Adoption
July-December
Financial
Evaluations,
Budget
Adjustments as
Approved by
Council
Budget Cycle
5 OVERALL
FUND
DESCRIPTIONS
AND
STRUCTURE
Fund Types Count
General Fund 1
Special Revenues 38
Capital Projects 3
Enterprise Funds 4
Internal Service Funds 2
Debt Service Funds 1
Agency Fund 1
Private Purpose Trust Fund 1
Total 48
FORECAST
AND
ASSUMPTIONS
7 Forecast Assumptions
Revenues
Based on best available information
Continued impacts of inflation/supply issues?
Legislative Impacts from Federal, State &
Regional Government
Estimates are prudently conservative
Cotati’s Revenue Base is Different
Sales tax & Measure S relatively secure
Reduction for Amazon Distribution Centers
Slowing in Cannabis Business Tax
No current hospitality industry or related taxes like Transient Occupancy Tax (TOT)
8 General Fund Growth Over Time
9 $-
$2
$4
$6
$8
$10
$12
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Millions
DOT COM-9/11 SARS GREAT RECESSION CDTFA SARS Covid-19
Forecast Assumptions
Expenses
Finding a Balance
• Revenues
• Service Level/Operating Expense
• Contract Services
• Liabilities Management (Capital, UAL )
• Issued Bonds in 2022
Outstanding Items
• Insurance Costs (Estimates)
10 GENERAL FUND
Proposed Budget for FY 2023/24
11 What is a
General
Fund?
• 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.
• For the City of Cotati these Core Services are
• Police
• Public Works
• Recreation
• Community Development
• City Management
• Administrative Services
• City-Wide (Non-Utility) Infrastructure Funding –
Next Study Session
12 General
Fund
Budget
Highlights
13 Minimum reserve of 25% of operating expenses, per Resolution 2009-50
Revenues Increase from 2022/23 Adopted Budget
•2022/23 Estimate - Increase 2%
•2023/24 Proposed – Increase 2%
CALPERS – Pension Payments
•ADP to CalPERS in FY 2021/22
•Continued Lump Sum Payment of PERS
•Includes $100K 115 Trust Payment – Based on Refunded Savings Plan •Pending Pension Obligation Evaluations Expected in September 2023/24 - Staffing Costs Increase 6% - Down from 10% PY •Budgeted Full Employment
•Salaries Increased 4%
•Negotiated MOU’s and Step Increases
•Increased Health Benefit Costs
Other Cost Changes
•Insurance Estimate increase 15%
•Primarily General Liability and Workers Comp
•Pending Final Estimates from CIRA
•Contract Services increase of 10%
General Fund
Operating In-Flows (Revenues)
14 * Includes cannabis business tax
2023/24
PROPOSED BUDGET
2022/23
EST. ACTUAL BUDGET $ Change % Change
601- PROPERTY TAX $ 2,131,758 $ 2,066,039 $ 65,719 3%
603- SALES TAX 6,084,000 6,100,000 (16,000) 0%
604- OTHER TAX * 652,300 626,450 25,850 4%
606- LICENSE & FRANCHISE 556,500 561,000 (4,500) -1%
608- REVENUE - OTHER AGENCIES 207,150 203,665 3,485 2%
620- CHARGES FOR SVS 473,926 426,805 47,121 11%
670- TRANSFR IN & OTHR SOURCES 164,000 179,322 (15,322) -9% 999- INTERFUND DEBT SERVICE 155,741 155,742 (1) 0%
LESS THAN $100K 230,658 285,834 (55,176) -19%
$ 10,656,033 $ 10,604,857 $ 51,176 0%
COMPARATIVE IN-FLOWS
15 $- $1 $2 $3 $4 $5 $6 $7
601- PROPERTY TAX
603- SALES TAX
604- OTHER TAX
606- LICENSE & FRANCHISE
608- REVENUE - OTHER AGENCIES
620- CHARGES FOR SVS
670- TRANSFR IN & OTHR SOURCES
999- INTERFUND DEBT SERVICE
LESS THAN $100K
Millions
Comparative Revenues - Est. 2022/23 to Proposed Budget 2023/24 EST. ACTUAL BUDGET PROPOSED BUDGET
IN-FLOWS
FOR BUDGET YEAR 2023/24
16 Major
In-Flows
Highlights
17 Property Tax Projected Revenue includes:
•2% Assessor’s applied CPI
•Other Slight Increase due to Property Transfers & Development •Total change of around 3%
Sales Tax Projected Revenue:
•Minor decrease in 2023/24 – from Expectations in 2022/23 – Less than 1% •Decreased Spending on Sales Tax Transactions
•Major Industry Groups in Cotati
Building/Construction
Fuel/Service Stations
State/County Pool
Food/Drug
Restaurants and Hotels
Other General Fund
In-Flows Highlights
18 Other Tax
•Cannabis Business Tax
•Estimated at $600K for 2023/24
•Decreased Sales due to Increased Competition and
Consumer Spending Changes
Licenses, Permits & Franchises
•No significant change
Other General Fund
In-Flows Highlights
19 Other Agencies
•Public Safety Contract Services with SSU
•Contract renewed for 5 years
Charges for Services
•Development/Public Works Charges
•Decreased Revenues in 2020/21 primarily due to Kessing Ranch •Police Charges
•Fiscal Year 2023/24 – Continue to move back to normal Post-Covid/Training Other Revenues
•No Significant Change
•Note - Transfers In for 2021/22 reflect the bond issuance receipts.
Out-Flow Highlights
20 •2021-22 - ADDITIONAL DISCRETIONARY PAYMENT OF $6M PROCESSED ($4.8M FOR GENERAL FUND), PLUS LUMP SUM
•2023-24 - FULL LUMP SUM PAYMENT OF THE PERS UNFUNDED LIABILITY IN THE AMOUNT OF APPROXIMATELY $365K
•DOES NOT INCLUDE DEBT SERVICE FOR POB PAYMENT OR 2022UAL
ESTIAMTED INCREASED COST
CALPERS
•ALLOCATED CONTRACT SERVICES
•SHARED INDIRECT COSTS SUCH AS AUDIT FEES, JANITORIAL COSTS, UTILITIES, ETC.
•BASED ON FULL FTE
CONTRACT
SERVICES
EVALUATION
•PENDING PROJECTIONS FROM CIRA
•BUDGETED ASSUMPTIONS
•15% FOR GENERAL LIABILITY AND WORKERS COMP
•7.5% FOR ALL OTHERS
•STATE OF THE INSURANCE MARKET
INSURANCE
INCREASES
•ESTIMATES ARE BASED ON EXISTING STAFFING
•INCLUDES ALL NEGOTIATED MOU CHANGES
•TWO MOU’S TO BE GOING INTO NEGOTIATIONS IN 2023/24
•EVALUATING STAFFING LEVELS
ALL DEPARTMENTS
ARE BUDGETED AT
FULL STAFFING
Allocations
21 Allocated Departmental Expenditures:
• Historically, Legal Services and Non-Departmental expenses were reported within separate departments within the general fund. However, as these services are utilized by all departments, these costs have now been reallocated to all departments using the proportional FTE. As such, there is no budgetary schedule provided herein.
General Government Expenditures represent the General Fund Transfers to Other Governmental Funds:
• There are various types of transfers related to other sources and uses of funds. For the budget presented, these transfers are not allocated to a department but rather shown as the general governmental expenditures. See the Capital Improvements section of the budget for further detail on the specific projects proposed within the City General Funds contributions. Most of the funding to be provided for Fiscal Year 2022/23 is only possible due to Measure S.
GENERAL FUND
OPERATING OUT-FLOWS (EXPENDITURES)
22 DEPARTMENTAL OUT-FLOWS
FOR PROPOSED BUDGET YEAR 2023/24
23 Department: 10 - CITY
COUNCIL, $173,922
Department: 11 - CITY
MANAGER, 745,543
Department: 12 -
ADMINISTRATIVE
SERVICES, 526,515
Department: 17 -
COMMUNITY
DEVELOPMENT, 1,067,823
Department: 18-22 - PUB
WORKS-COMBINED,
1,322,838
Department: 23 - POLICE,
5,216,308
Department: 24 -
RECREATION, 469,017
Department: 25 - CODE
COMPLIANCE, 43,975
Expenditure Highlights
Departments Detail
24 City Council includes the following:
•Increased Benefits primarily health insurance.
• Continued allocation of shared indirect costs;
primarily city utilities and insurance included
within other expenses
•Other expenses includes additionally
payments for dues and subscriptions and
trainings/meetings.
Department Highlight
City Managers Office
25 City Manager includes the following:
• Continued inclusion of Public Information Services
under the City Manager Department
• Major Projects Planned Include:
• Economic Development 2.0 (Co-Lead with CD)
• Countywide Broadband/Procurement Coordination
• FIGR Coordination
• Continued Equity Program Implementation
• Personnel Rules Update
• CPOA/CPMA MOU Negotiations
• Emergency Operations Plan/Communication
Department Highlights
Admin. Services &
Community Development
26 Admin. Services includes the following:
•Recruiting for Intern
•Increased Fiscal Fees incurred by the City for General Fund revenues received •Major Projects Planned Include:
•Transition to Monthly Utility Billing
•Digital Records Workflow
•Hydrant Meter Program Update (support PW)
•Payroll System Update
•TOT Taxation Process/Documentation
•Financial Policy Review/Update
Community Development includes the following:
•Use Outside Contractors for Building and Code Enforcement Functions •Major Projects Planned Include:
•Bike and Pedestrian Master Plan Update
•Santero Way Specific Plan Update
•Economic Development 2.0 (Co-Lead with CM)
•Housing Administration Establishment
•Update electronic permitting system
•Monitor/Implement New State Housing Legislation
•General Plan Safety Element Update
Department Highlights
Public Works
27 Public Works includes the following:
•Significant other expenses include dues and subscriptions and allocated insurance
•Major Non-Capital Projects Planned Include:
•Wastewater System Emergency Generators (Grant Project) •Annual Pedestrian/Bicycle Safety Project
•Annual Street Landscape Project
•Hydrant ATM (Lead with Admin. Services)
•SCADA System Upgrade
•Asset Management/Unified Request Tracking
Department Highlights
Police
28 Police Services includes the following:
•Continued investment in technology services through the public safety consortium
•Additional Costs for Training and Correlated Overtime. •Position changes for include additional FTE for a Records Staff. •Significant other expenses include allocated insurance, recruiting, small tools and equipment, and vehicle fuel.
•Major Projects Planned Include:
•Continued Training for De-Escalation, Implicit Bias, recognizing people in mental health crisis
•K9 Replacement (Scent Tracking Dog)
•Hi-Lo Evacuation Drill
•Full Deployment of BOLA wrap
•Continue EV vehicle deployment
•Pedestrian/Vehicle/Beat Focused Enforcement
29 Recreation includes the following:
• RecDesk Annual software contract renewal
• Significant other expenses include allocated insurance and bank fees • Major Projects Planned Include
• Dogs in Park Ordinance Update
• Veronda-Falletti Barn Design/Fundraising
• Putnam/Sunflower Park Design
• Veterans Building Incorporation for Rentals
Code Compliance
• No significant changes
• Expense can be variable based on the caseload
Department Highlights Recreation &
Code Enforcement
Conclusion
30 A balanced budget
maintaining prudent fund
balance levels
We will continue to closely
monitor the operating
revenues to ensure sufficient
fund balance and cash flows
for continued operations
Operating reserve
requirements continue to be
exceeded for General Fund
Pending Evaluation with
Planning of Capital Projects
City staff will continue to
update the Council on any
significant budgetary changes
prior to budget adoption.
City staff are committed to
exercise prudence and
integrity in the management
of public funds and provide
transparency and
accountability in its use.
31