Cotati City Council
Agenda Staff Report
Item type: CONSENT CALENDAR (ACTION)
To: City Council
Subject: ADOPTION OF RESOLUTION APPROVING ANNUAL
APPROPRIATIONS (GANN) LIMIT FOR FISCAL YEAR
2025/26
Date: June 10, 2025
Written by: Angela Courter, Director of Administrative Services Recommendation
It is recommended that the City Council of the City of Cotati adopt a resolution approving the Annual Appropriations Limit for the City of Cotati Fiscal Year 2025/26.
Background
On November 6, 1979, California voters approved the Gann Spending Limitation Initiative (Proposition 4) establishing Article XIIIB of the State Constitution. Subsequently, on June 5, 1990, California voters approved the Traffic Congestion Relief and Spending Limitation Act (Proposition 111), which made various amendments to Article XIIIB of the State Constitution.
Article XIIIB sets limits on the amount of tax revenues that the State and most local governments can appropriate within a given fiscal year.
The Appropriation Limit is based on actual appropriations during the 1978/79 fiscal year, as increased each year using specified population and inflationary growth factors. The original legislation implementing the provisions of Article XIIIB became effective January 1, 1981. In accordance with that legislation, the governing body of each government jurisdiction must, by resolution, establish its annual Appropriation Limit for the coming year (prior to July 1) at a regularly scheduled meeting or noticed special meeting. Based on Article XIIIB, the City of Cotati can use the larger of two measurements of population growth, (county or city population growth) in the Appropriations Limit calculation. For Fiscal Year 2025/26, the City is using the Sonoma County population factor, as this is higher than the rate for the City of Cotati.
Analysis/Discussion
Section 7910 of the State Government Code requires a governing body to annually adopt by resolution, an Appropriations (Gann) Limit for the upcoming fiscal year when the budget is adopted. The Appropriations Limit is adjusted annually based on population and per capita income changes. This updated information was received from the California Department of Finance in May and is included within the final Appropriations Limit calculation.
Staff have calculated the GANN limit to be $21,006,705. The City’s tax proceeds subject to the FY 2025/26 Gann Limit are estimated at $8,887,030. Therefore, the City is deemed to be under the Gann limitation, by $12,119,675, and in compliance with state law. Adoption of the attached Resolution will formalize the Gann limit calculation for FY 2025/26.
Financial Considerations
The adoption of the Fiscal Year 2025/26 Appropriations Limit has no impact on City resources.
Environmental Issues
Adoption of the proposed appropriations limit involves an administrative activity that will not result in direct or indirect physical changes in the environment. As such, adoption of the resolution does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378, and no further environmental review is required.