EXECUTIVE SUMMARY
The Fiscal Year 2022-23 Proposed Operating Budget includes $29.91 million in revenues and $29.27 million in expenditures. The budget format addresses revenues and expenditures for all budgeted fund types citywide, while providing an expanded, comprehensive budgetary analysis of the General Fund – the City’s main operating fund.
The City’s budget is comprised of six governmental fund type categories that include the General Fund, Special Revenue Funds, Debt Service, Capital Project Funds, Fiduciary Funds and Enterprise/Wastewater Funds. Departments funded by the General Fund provide core community services, such as public safety (e.g., police and fire protection), community development, (e.g., planning and building) and public works (e.g., engineering, park maintenance, and buildings/grounds) as well as vital support functions including overall city administration, legal, finance, information technology, and human resources. These core services are primarily supported by major revenue sources that include property tax, sales tax, Measure C sales tax, Measure F cannabis business tax.
General Fund – Fund Balance and Reserves
As of June 30, 2022, the City’s General Fund projected ending fund balance is $9,343,397 The proposed FY 2022-23 budget projects General Fund revenues and expenditures total approximately $16.36 million and $16.41 million, respectively. The June 30, 2023, projected fund balance is $9,292,522 or a 56.61% fund balance.
General Fund - Revenues
The General Fund's four largest revenue sources - property tax, sales tax, Measure C, and Measure F account for approximately $10.08 million or 61.59% of the total General Fund revenues. In total, these four major revenue streams have increased by $1.07 million compared to the Fiscal Year 2021-22 Adopted Budget. The City will continue to monitor these revenues over the year as the continued impact of COVID-19 continues to influence the economy. The City will also continue to no longer budget potential grants until the grant is funded and received by the City. A supplemental appropriation will be done at that time to adjust the revenue and corresponding expense account.
General Fund - Expenditures
The City's Fiscal Year 2022-23 Proposed Budget projects General Fund expenditures totaling $16.41 million. Overall proposed budget changes include adjustments to department line items, especially for repairs and maintenance, salaries and benefits, and contract services. By conducting a three-year comparison and analysis of department budgets, expenses and potential cost savings were comprehensively evaluated. The outcome of this analysis continues to capture a clearer picture of each department’s true cost and, as a result, over or underused budget expenses were adjusted appropriately.
The Fiscal Year 2022-23 Proposed City Budget includes 70 budgeted full-time equivalent (FTE) positions, a net increase of three FTE positions from the Fiscal Year 2021-22 Adopted City Budget.
There is an overall increase of $563,000 in budgeted salaries and wages primarily due to beginning to budget for annual leave payouts, increased health insurance rates and budgeted step increases for all bargaining units per each units Memorandum of Understanding.
Listed below and in alphabetical order are the specific department budget changes for Fiscal Year 2022-23 (e.g., increases, decreases).
City Attorney’s Office
The City Attorney’s budget overall is decreasing $28,000 mainly due to expenses for contested matters beyond the monthly limit of 50 hours of regular attorney services. This recommended decreased allocation is based on the prior year’s average use of internal contract legal services. A separate budget line item is continued to be used to capture services provided from outside legal services for $35,000.
City Manager’s Office
For Fiscal Year 2022-23, the overall proposed budget remains within $2,000 from the prior year. There was an overall deduction to Professional Services that will be offset by adding $10,000 to the budget for the upcoming election in November.
Community Development Department
The Community Development Department contains Economic Stability, Planning & Zoning, and Building. The Professional Services budget for the Planning and Building Division includes an increase of $15,000. This increase comes from contracting a building inspector service until a full-time building inspector is hired and offset by decreased consultant costs to cover planning services needed in the prior fiscal year while hiring department director positions. Salaries and benefits increased by $151,000 to account for a full time Community Development Director and a full time Assistant Community Development Director.
This year also includes $528,000 to complete the Zoning/Housing/Safety Element Ordinances through a grant from SACOG (Sacramento Area Council of Governments) that requires a $17,000 City match, and an additional $70,000 from SACOG for economic development still to be determined.
Finance Department
The Finance Department budget was decreased overall by $15,000. In FY 2021-22 there was additional funding for outside financial consulting that will cannabis ordinance update and finance support services due to vacancies in the Department that were removed during the analysis of the current year needs.
Fire Department
This year’s Fire Department budget is expected to slightly decrease by $14,000. The majority of this decrease comes from the intrafund transfer for dispatch services. A new calculation for this allocation was created to use the total number of fire calls versus the total overall dispatch calls to create a percentage to be applied to the total dispatch budget to be allocated between the Police and Fire Departments. Most of the Services & Supplies budget was consistent with prior year budgets with the exception of SCBA’s which saw a decrease of $33,000 between fiscal years due to a grant in FY 2021-
22. The Fire Department has been very successful and committed in past grant writing efforts. For FY 2022- 23, grants will be added to the budget through supplemental appropriations once approved by Council, funded, and received by the City.
Fleet Department
In FY 2022-23, the Fleet Maintenance Division and budget will be overseen by the City Manager until a new Fire Chief and Public Works Director are hired. Although the City has experienced tremendous success with leased vehicles in the Police and Public Works Departments, the City continues to experience significant challenges maintaining its Fire Department apparatus and other Public Works equipment. As a result, the City continues to maintain a Fleet Department in order to maintain the Fire Department’s apparatus and Public Works equipment. This budget is status quo from last fiscal year.
General Services
General Services refers to expenditures that are not directly tied to a single department budget and fulfill the equipment, project, program, and service needs of multiple departments and/or the entire City organization as a whole. With that in mind, all the City’s insurance needs (e.g., liability, property, vehicle, crime, flood, and fraud) are in the General Services budget totaling $522,000, an increase of $17,000 from FY 2021-22 mainly due to the increase in the cyber insurance market.
Homeless Services
While in prior years funds to address homeless activities were not earmarked and budgeted for, in FY 2019-20 the City established a “Homeless Services Division”. This year’s budget of $16,000 is status quo from the prior year. This Division allows the City to better serve and more transparently account for and track the City’s true costs and efforts to address homelessness. The Division’s budget is used for the City’s share of the Executive Director for the Homeless Consortium, outreach and enforcement, clean-up and equipment, and portable restrooms.
Human Resources
To continue greater governmental transparency and employ municipal finance best practices, all employee related costs that departments cannot control nor can be allocated to a specific employee have been allocated to the Human Resources (HR) Department. These expenses include unemployment, workers compensation, CalPERS unfunded pension liability, and employee recruitment costs (e.g., background check, fingerprinting, credit check, medical exam, and psychological exam).
The total HR budget for Fiscal Year 2022-23 is $1.51 million with the largest allocation being our Pension Obligation Bond payment totaling $.99 million.
Police Department
In the Police Department, the overall budgets for Police and Dispatch have stayed comparatively the same as the prior year with only an overall budget increase of $169,000. The main increase of $156,000 comes salaries and benefits resulting from negotiated step increases and salaries. A new full time Records Clerk, from an existing part time position, has also been proposed to assist with the new state and federal mandated reporting. This will require no increase to the budget as savings from individual line items have been reallocated to cover the cost of the position.
In the Animal Care Services Division, there is an overall decrease of $7,000 mainly attributed to the success of the Trap, Neuter, and Release (TNR) Program, which allows for trapping, “fixing”, and releasing local cats along with foster care and Fieldhaven’s local assistance. This has allowed the City to be able to greatly reduce its cat sheltering expenses over the past four fiscal years.
The Supplemental Law Enforcement Services Funds (SLESF) and Citizens’ Option for Public Safety (COPS) are considered Special Revenue Funds that are derived from revenue sources that are State regulated and must be spent for specific purposes. This year’s SLESF/COPS Fund total expenditures of $180,000 will support a variety of Police activities, including salaries, tasers, vehicle leases, automated license plate reader program, and other frontline equipment.
This fiscal year the Police Department’s grant writing efforts are expected to continue and to assist with the City’s ongoing commitment to increased and improved public safety. These grants will be added to the budget through supplemental appropriations once approved by Council, funded, and received by the City.
Public Works
The Public Works Department includes the following Divisions: Facilities & Parks, Public Works & Engineering, Streets, and Wastewater Treatment. The Public Works & Engineering budget is looking at an overall increase of $16,000 mainly due to unfreezing the Public Works Director position.
The Facilities and Parks budget has an overall decrease of $190,000 from FY 2021-22 that includes the following notable changes:
▪ Conversation of a part time Maintenance Worker to full time ($43,000 increase); ▪ Removal of one time grant projects for Ellis Lake carp removal of $142,000; and ▪ Materials for the Bryant Field fence replacement project ($110,000 decrease).
The Gas Tax Fund (Streets) budget is status quo with very little change from prior years with the exception of two accounts. Capital additions include $25,000 for a tow behind compressor and $25,000 for a trailer to haul newly purchased Bobcat from FY 2021-22. Also proposed is an interfund transfer to the Street Capital Fund up to $334,106 for the construction management and contingency fund for the 5th Street Project started in FY 2021-22 and expected to be completed in this fiscal year.
Enterprise/Wastewater Funds are derived from revenues generated directly from the user charges and fees of sewage rate payers. These funds are not subsidized by the General Fund and activities and projects associated with these funds are intended to be fully self-supported by user charges and fees.
In the City of Marysville, the Enterprise/Wastewater Fund is used to support the City’s main connection to the Linda County Water District (LCWD), manage and maintain the City’s wastewater treatment services and collection system within the City limits.
The Enterprise/Wastewater Fund working expense budget for this fiscal year is $3.01 million, representing a net decrease of $116,000 from the prior year’s adopted budget. The decrease in expense is primarily due to an interfund transfer to the Wastewater Capital Fund to cover costs related to the decommission of the sewer ponds until grant funds are received.
Included in the Enterprise/Wastewater budget are debt service payments for the 2021 Series A Revenue Bonds ($724,500) that refinanced the 2012 Revenue Bonds and the 2021 Series B Revenue Bonds ($263,500) that paid off the Linda County Water District Loan and provided $3 million in capital improvement funding. The Fund’s total debt service for this fiscal year is $.99 million.
The Linda County Water District (LCWD) connection and collection system fully operational, and $1.12 million has been budgeted to fulfill the City’s contractual agreement with LCWD to fund reasonable and appropriate operations and maintenance costs, including capital improvements.
Bonded Debt & Long-Term Obligations
The Debt Service Fund includes $910,500 to fund vehicle leases, through Enterprise Fleet Services, debt payments (principal and interest), and bond payments. This year includes $514,500 for the 2019 COP (Certificate of Participation) bond that refunded the 2011 COP for the B Street Property in September of 2019 and a new seven year lease payment for a required digital encryption radio system for public safety at $152,500.
In addition, new and existing lease payments continue to be budgeted in the Debt Service Fund for improved and consistent tracking and transparency. The total for all vehicle leases is $163,500 and it includes: one utility truck for Fire, four trucks for Public Works, one boom truck for Public Works, and eight vehicles for Police.
Also included in the Debt Service Fund are payments in the amount of $75,500 for the 2017 Clean Renewable Energy Bonds. As part of the overall financing of the project, an annual energy subsidy revenue of $27,000 is budgeted and will offset a portion of the cost of the debt service for the solar project.
Long Range Planning & Capital Projects
Capital Project Funds are used for the acquisition, development, design, construction, and refurbishment of capital assets and infrastructure. The following projects are budgeted in the Fiscal Year 2022-23 Capital Projects Funds (including the Enterprise/Wastewater Fund):
▪ General Plan (comprehensive policy document) update that will be completed over the 2021-22 and 22-23 fiscal years ($429,964 transferred from the General Fund); ▪ Proposition 68 Per Capita Grant Program ($177,952) and SACOG (Sacramento Area Council of Governments) Community Design Funding Program ($77,000). These two grants will fund the design, construction, and play equipment for Gavin Park over 2021-22 and 22-23 fiscal years.
The total project will be $327,952 to include an additional $50,000 in APRA funds. There is no match from the City’s General Fund;
▪ 5
th Street Reconstruction Project from E Street to J Street ($3,516,500 total project cost) that will be completed over 2021-22 and 22-23 fiscal years. This project will be funded with $2,500,000 from SACOG and Regional Surface Transportation Program (RSTP) funds, remaining $550,000 funds from PS&E from RSTP, and up to a $466,500 match from the City’s Gas Tax Fund;
▪ Two sewer main repair projects at Greely Drive ($235,000) and Aldridge Drive ($263,000) to be paid out of the Enterprise/Wastewater Capital Project Fund; and ▪ Completion of the decommission of the north and south sewer ponds to be finalized in FY 2023-
24. The cost of the project is not to exceed $7,353,299 and will be funded in whole by a grant received by the State Water Resources Control Board (SWRCB).
Use of American Rescue Plan Act (APRA) Funds
The Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program provided governments across the county with resources needed to recover from the COVID-19 public health emergency through APRA funding. The City of Marysville will receive $3,078,479 of these funds between two equal payments received September 2021 and September 2022 to be obligated by December 31, 2024. The following list are projects using these funds proposed for Fiscal Year 2022-23 totaling $1,950,000:
▪ Marketing grants for small businesses, criteria to be developed ($100,000); ▪ Enhanced playground equipment for Gavin Park project ($50,000); ▪ Down payment on required digital encryption radio system for public safety ($1,000,000); ▪ Engineering and environmental cost for 22nd Street reconstruction project ($200,000); ▪ Deferred maintenance of City Hall including roof repairs, HVAC units, painting, and windows ($500,000); and
▪ Concrete retaining wall at Bryant Field to complete outfield wall project ($100,000).