General Fund
Budget Work
Session
February 4, 2025
Agenda Overview
• Overview of the Five-Year General Fund Model Update
• Key Factor of Changes Since FY 2025 Adoption
• Overview of General Fund Model Assumptions
• Budget Balancing Strategies
• Interactive Budget Model
• Closing Remarks and Next Steps
1 Five-Year
General Fund Forecast Update
2 Key Factors of Changes
Revenue
Increase in Property
Tax projections due to
a number of new
developments
coming online
Increase in Utility
User Tax projections
due to continued
increase in electric
generation.
One-time ARPA
appropriation in
FY 2025.
Continued recovery
in key revenue
sources impacted by
the pandemic, such
as Transient
Occupancy Tax (TOT)
Expenditure
All labor contracts
Changes in CalPERS cost
FY 2024 Ending
Balance at
$44.9M vs. $29.4M
Accounting for Loan to
HEDC
Other
3 General Fund Revenue by Source
Total: $224.1M
Property Tax
33.1%
Sales Tax
21.3%
Utility Users Tax
11.8%
Property Transfer Tax
7.9%
Permits & Fees
6.8%
Franchises
5.8%
Other Taxes
4.2%
Transfers In
3.9%
Interest & Other Revenue
5.4%
4 Key Revenue Assumptions
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
Property Tax Sales Tax Utility Users
Tax
Property
Transfer Tax
Permits & Fees Franchises Other Taxes Transfers In Interest & Other Revenue
FY 2025 Revised Revenue Annual Growth Assumption
5 General Fund Expenditure by Category
Total: $227.3M
Salaries & Benefits, 79.5%
Supplies & Services, 5.1%
Maintenance & Utilities, 0.7%
Internal Service Fees, 8.2%
CIP Transfer, 0.9%
Econ Dev Transfer, 0.2%
OPEB Unfunded Liability, 1.2% Debt Service Transfer, 1.1% Liability Insurance, 3.0%
6 Revenue Budget Balancing Strategies
Taxes
Transient Occupancy Tax
Cannabis Tax
Short-term Rental
Business License Tax
Measure C/K1
Fees
Impact Fees
One-time
Revenue
238 Sale Proceeds
7 Expenditure Budget Balancing Strategies
Operational Efficiencies
& Program Consolidation
Essential Services
Program Evaluation
Reduce GF Subsidy to
Capital
Reduce GF Annual
Subsidy
Defer Capital Purchases
Personnel Cost Strategies
Hiring Freeze
Overtime Policy
Examination of Vacancies
8 Interactive
Budget
Model
Menti.com
Code: 2774 5224
Strategies
Revenue Strategies (5)
• Cannabis Tax – Increase up to the full 15%
• Transient Occupancy Tax (TOT) – Increase
up to 14%
• Half-Cent Sales Tax (Measure C/K1) –
designated amount
• Short-Term Rental (STR) Tax Enforcement
• Business License Tax Adjustments
Expenditure Strategies (5)
• Operational Efficiencies & Program
Consolidation – Cut amount or some
percent
• Reduce General Fund Subsidy for Capital
Projects – designated amount
• Hiring Freeze – three-months
• Reduce Overtime – designated amount
• Strategic Program Evaluations – Cut
amount or some percent
10