CITY COUNCIL
CONTINUED REGULAR MEETING AGENDA
Wednesday, June 8, 2022, 6:00 P.M.
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AGENDA
AGENDA
CALL TO ORDER
REGULAR AGENDA
1. PUBLIC HEARINGS
For public hearings involving a quasi-judicial determination by the Council, the proponent of an item may be given 10 minutes to speak and others in support of the proponent’s position may be given three minutes each. A designated spokesperson for opposition to the item may be given 10 minutes to speak and all others in opposition may be given three minutes each. Very brief rebuttal and surrebuttal may be allowed in the sole discretion of the Council. In public hearings not involving a quasi-judicial determination by the Council, all persons may be given three minutes to speak on the matter. Public hearings on non-controversial matters or for which testimony is not anticipated may be placed on the Consent Agenda, but shall be removed if any person requests a staff presentation or wishes to be heard on the matter.
A. Ordinance to Approve the Fiscal Year 22/23 Operating and Capital Improvement Budget; and Amend the Fiscal Year 21/22 Operating and Capital Improvement Budget This is a continued item from the June 1, 2022 City Council Meeting.
Reference: Tori Hannah, Administrative Services Director/Assistant City Manager Recommended Action: Introduce and hold the first reading of an ordinance to adopt the Fiscal Year 22/23 Operating and Capital Improvement Budget, amend the Fiscal Year 21/22 Operating and Capital Improvement Budget, and direct that publication of the ordinance will be satisfied by publication of a summary approved by the City Attorney.
CEQA: Does not constitute a “Project” per California Environmental Quality Act Guidelines Section 15378
ADJOURNMENT
NOTICE OF ADA COMPLIANCE: Pursuant to Title II of the Americans with Disabilities Act (Codified At 42 United States Code Section 12101 and 28 Code of Federal Regulations Part 35), and Section 504 of the Rehabilitation Act of 1973, the City of Pacific Grove does not discriminate on the basis of race, color, religion, national origin, ancestry, sex, disability, age or sexual orientation in the provision of any services, programs, or activities. The City of Pacific Grove does not discriminate against persons with disabilities. City Hall is an accessible facility. A limited number of assisted listening devices will be available at this meeting. Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting or provide the requested agenda format.
Agenda No. 1 A
CITY OF PACIFIC GROVE
300 Forest Avenue, Pacific Grove, California 93950
TO: Honorable Mayor and Members of the City Council
FROM: Tori Hannah, Administrative Services Director/Assistant City Manager MEETING DATE: June 8, 2022
SUBJECT: Ordinance to Approve the Fiscal Year 22/23 Operating and Capital Improvement Budget; and Amend the Fiscal Year 21/22 Operating and Capital Improvement Budget This is a continued item from the June 1, 2022 City Council Meeting.
CEQA: Does not constitute a “Project” per California Environmental Quality Act Guidelines Section 15378
RECOMMENDATION
Introduce and hold the first reading of an ordinance to adopt the Fiscal Year 22/23 Operating and Capital Improvement Budget, amend the Fiscal Year 21/22 Operating and Capital Improvement Budget, and direct that publication of the ordinance will be satisfied by publication of a summary approved by the City Attorney.
DISCUSSION
The Proposed Fiscal Year 22/23 Budget and Capital Improvement Plan is a program budget, which also serves as the City's annual operating plan. The City Council's Strategic Goals are used as the foundation for determining annual funding initiatives. Key expenditures that align with strategic goals and prior year accomplishments are presented in the Department Overview and Capital Improvement sections of the budget document.
The following table provides a chronology of the events leading up to the first reading of the Operating and Capital Improvement Budget Ordinance for Fiscal Year 22/23.
Item Meeting Date
Received a Mid-Year Financial Update April 6, 2022
Adopted the Master Fee Schedule for Fiscal Year 22/23 April 20, 2022 Provided the Five-Year Forecast and Budget Workshop May 4, 2022 Received Financial Information on the Local Water Project Business Plan May 4, 2022 Received and Approved the Fiscal Year 22/23 Capital Improvement Plan May 11, 2022 Presented ARPA Survey Results and Project Direction May 18, 2022 The Proposed Fiscal Year 22/23 budget was developed based on economy recovery occurring in Fiscal Year 21/22, with conservative growth projected in the forthcoming year. The Fiscal Year 22/23 City-wide budget includes a $5.2 million capital improvement plan; and a $203,000 capital outlay budget. The Proposed General Fund budget is relatively similar to the Fiscal Year 22/23 amounts that were included in the presentation of the Five-Year Fiscal Forecast. The primary adjustment to the forecasted base year is the addition of the receipt and transfer of promissory note proceeds. A copy of the updated General Fund forecast is included within the budget document.
ARPA Funds
The Five Year Forecast and Budget Workshop included the use of $1 million in American Rescue Plan Act (ARPA) funds to supplement the General Fund, with approximately an additional $843,000 available for allocation to City Council and community priorities. This proposed use of ARPA funds is consistent with the US Treasury Guidance under the Replace Lost Public Sector Revenue criteria; as well as the $1.45 million in funds that were appropriated in Fiscal Year 21/22 to year to eliminate the furlough, restore frozen positions, and reinstate funding for various programs and deferred operating expenditures. The remaining Fiscal Year 21/22 ARPA funds of approximately $394,000 were primarily used to fund capital improvements or capital equipment.
The unprogrammed Fiscal Year 22/23 ARPA funds are anticipated to be allocated through a budget amendment, once the City has had the opportunity to review the free-form comments that were received from the ARPA Community Survey. The ARPA Fund's remaining available balance for this endeavor is projected to be $848,559, which includes projected interest earnings. These unallocated funds can be appropriated at a later Council Meeting.
General Fund
An overview of the General Fund revenues and department budgets are included in Attachment 1.
Additional details can be found in the General Fund Revenue and Expenditure sections of the Proposed Fiscal Year 22/23 Budget document.
Key budgetary highlights are listed below:
Revenues
An overall increase in revenues of approximately $3.7 million or 14% when compared to the Fiscal Year 21/22 Adopted Budget; or $1.9 million of 6.74% when compared to the Fiscal year 21/22 Estimated Budget. The Fiscal Year 22/23 Proposed Budget builds upon the increase in TOT and sales tax revenues that were projected in Fiscal Year 21/22; as well as includes $975,000 in Measure A sales tax revenues. When Measure A is excluded from the annual comparison, the growth between the Adopted and Estimated budgets is approximately 10.3% or 3.6%, respectively. Key factors include:
Addition of Measure A revenues for three quarters of the fiscal year, with an effective date of October 1, 2022
Increase in taxes of $3.6 million when compared to the Fiscal Year 21/22 Adopted Budget.
A contribution or Interfund Transfer of $1 million in ARPA funds Proceeds from water entitlement sale promissory notes of $776,737 and $200,000 in one-time water entitlement sales
Expenditures
The overall General Fund expenditures are anticipated to increase by $3.7 million or 14%, when compared to the prior year Adopted Budget, while operating expenditures are projected to rise by 10.5% or $2.5 million. Some factors related to the increase are listed below:
Rising CalPERS unfunded liability payments: $406,000
Allocation of funds towards General Plan amendments: $100,000 Increasing fire contract service costs: $141,000
Incorporating a 3% cost of living increase for all City employees: $300,000 Implementing the results of a compensation study for Unrepresented and Department Head positions that have not been studied since 2017: $140,000 Increasing legal costs from the Adopted and Estimated Budget: $379,000 and $134,000, respectively
Funding for an annual Monarch Sanctuary Management Plan and a Long-Term Monarch Sanctuary Strategic Plan: $35,000
Incorporating State fees to implement the Measure A tax measure: $40,000 Funding for a comprehensive fee study, including development impact fees: $48,000 Purchasing trees for City properties: $35,000
Transferring water entitlement sales and related promissory note proceeds to the Local Water Project: $876,737
Local Water Project Fund
The Local Water Project (LWP) Business Plan was presented at City Council Meeting on May 4, 2022. Some initial strategies were discussed to assist in achieving fiscal sustainability, as well as identifying a plan to repay the Sewer Interfund Loan. During that presentation, the City approved using the proceeds from a $625,187 promissory note to pay the principal and interest on the Sewer Fund Interfund Loan. The interest on this loan will be processed quarterly on a retroactive and prospective basis at a rate equivalent to the City's investment portfolio earnings. The City is anticipated to receive the promissory note proceeds in Fiscal Year 22/23, with the amount of the loan repayment due upon receipt.
During the Five-Year Fiscal Forecast and Budget Workshop agenda item, staff provided preliminary information on transferring a $151,550 non-refundable deposit from a second promissory note, as well as an additional $100,000 in water entitlement revenues. In the Fiscal Year 22/23, these proposed inflows of revenues are listed as Interfund Transfers in the amount of $876,737; with a corresponding $600,000 Interfund Transfer to the Sewer Fund for the loan principal repayment. The interest on the loan will be paid be as an expense in the Local Water Project's operating budget, rather than as a transfer. Based on these updates, it is estimated that the Local Water Project will end Fiscal Year 22/23 with an estimated "available" fund balance of approximately $30,400.
In Fiscal Year 21/22, the City was originally planning to transfer approximately $200,000 or the complete amount of water entitlement sales for Fiscal Year 21/22 to the Local Water Project. At the time this agenda report was prepared, water entitlement sales were exceeding the budgetary estimate.
These additional funds are likely to increase the projected "available" fund balance.
City Council Training Budget
Staff presented a proposed update to the City's Travel Policy. While the revisions are still pending, one Staff presented a proposed update to the City's Travel Policy. While the revisions are still pending, one of the recommendations included receiving City Council approval for travel as part of the budget adoption process. The Fiscal Year 22/23 City Council travel, training, and meeting expenditures are proposed at $17,200. This would equate to approximately $2,457 for each Council Member. Prior to the pandemic, the annual average City Council travel expenditures were $11,000; however they have ranged from a low of $6,900 to a high of $21,000. The amount of travel expenses could vary each year based on Council Member interests, as well as course offerings. The City Council travel budget has previously been used for Council Members to attend the Annual League of California Cities Conferences or trainings; and the Pacific Grove Chamber of Commerce luncheon.
Fiscal Year 21/22 Budget Amendments
The attached ordinance also includes an amendment for the following amendments to the Fiscal Year 21/22 Operating and Capital Improvement Budgets:
General Fund Amendments
Zoning enforcement revenues to align with updated projections Estimated election costs associated with the Measure A tax initiative General Fund CIP Fund
Carry forward adjustments to the Public Works Fire Project to provide for the appropriate calculation of fund balance
Budget Document Information
The Fiscal Year 22/23 Budget incorporates criteria established by the California Society of Municipal Finance Officers (CSMFO) and the Government Finance Officers Association (GFOA). The goal of the criteria is to provide a document that is transparent, easy to read, and provides a comprehensive fiscal, as well as operating plan. The City received the CSMFO Excellence Award and the GFOA Distinguished Budget Award for the Fiscal Year 21/22 Budget. This most recent CSMFO and GFOA Awards, represent the third and fourth consecutive years, respectively, that the City has received this honor.
The budget is labeled in draft form to allow for any revisions that may occur as part of the budget presentation. The document may be modified by any updates to the Council Strategic Goals or Tactics; operational metrics that may not be available until the end of the fiscal year; and the addition of appendix items. Modifications may also include non-substantive changes based on the budget review comments received by GFOA or CSMFO.
Due to the late timing of the Five-Year Forecast and the Budget Workshop, the Fiscal Year 22/23 Proposed Budget will be available after 2:00 pm on Friday. The Proposed Budget can be accessed from the following link: Budgets | City of Pacific Grove This is the first reading of the ordinance. The second reading is schedule for June 15, 2022.
OPTIONS
Approve ordinance
Approve ordinance
Provide alternate direction
FINANCIAL IMPACT:
The Proposed Fiscal Year 22/23 Budget estimates an ending General Fund balance of $10 million.
This is approximately $16,000 above recommended policy levels.
The estimated impact to all other Funds is included in the attached ordinance.
GOAL ALIGNMENT: Financial Stability: Develop a strategic plan to better address current and future City expenditure and revenue needs.
Attachments
General Fund Overview
Budget Adoption Ordinance
PPT
FY 21/22
Adopted
FY 21/22 MidYear EstimateFY 21.23
Proposed
Difference from
Adopted Notes
Beginning Fund Balance $ 9,441,669 $ 9,441,669 $ 9,854,161 Revenues
Property Taxes $ 8,418,000 $ 8,518,000 $ 8,840,000 $ 422,000 (a) TOT and Licenses 4,783,000 5,779,000 5,962,000 1,179,000 (b) Sales and Use Tax 4,109,000 4,309,000 5,616,000 1,507,000 (c) Franchise and Utility User Taxes 3,091,000 3,260,000 3,475,000 384,000 (d) Business Licenses 359,000 322,000 322,000 (37,000)
Other Taxes 117,000 229,000 237,000 120,000 (e)
License, permits, and impact fees 1,304,000 1,277,000 1,045,000 (259,000) (f) Intergovernmental Revenues 153,000 72,000 292,382 139,382 (g) Charges for Services 1,826,000 1,705,000 1,928,000 102,000 (h) Fines and Forfeitures 138,000 37,000 49,000 (89,000) (i) Interest, rents, and concessions 304,000 296,000 310,000 6,000 Other revenues 614,000 819,000 1,503,737 889,737 (j)
Other revenues - Bequest 181,000 181,000 - (181,000)
Other revenues - ARPA 1,450,000 1,846,159 1,000,000 (450,000) (k) Transfers -
$ 26,847,000 $ 28,650,159 $ 30,580,119 $ 3,733,119
Expenditures - -
Departments
City Council $ 352,751 $ 532,758 $ 385,227 $ 32,476
City Manager 1,035,663 1,235,782 1,230,107 194,444 (l)
City Attorney/Legal Services 495,280 710,280 762,100 266,820 (m) Economic Development - 124,833 124,833 (n)
Finance 1,277,474 1,299,804 1,392,325 114,851
Information Systems 723,709 811,048 870,666 146,957
Community Development 2,774,206 2,898,219 2,813,339 39,133 Police 7,253,249 7,218,602 7,928,629 675,380 (o)
Fire 3,949,051 3,952,961 4,246,200 297,149 (p)
Public Works 3,846,209 3,849,244 4,239,165 392,956 (q)
Library 1,040,499 1,026,476 1,125,728 85,229
Recreation 809,846 792,694 920,638 110,792 (r)
Museum 282,940 307,772 314,500 31,560
Capital Outlay 5,000 113,053 145,000 140,000
Capital Project Transfers 500,000 701,173 575,000 75,000 Debt Service 2,170,418 2,170,415 2,237,415 66,997
Interfund Transfers 150,000 617,386 1,100,737 950,737 (s) Total $ 26,666,295 $ 28,237,667 $ 30,411,609 $ 3,745,314 Net Difference $ 180,705 $ 412,492 $ 168,510
Estimated Ending Fund Balance $ 9,622,374 $ 9,854,161 $ 10,022,671 $ - $ - Reserve Calculation
Expenditures applicable to policy $ 28,590,872
Policy percentage - 35% $ 10,006,805
Difference from policy $ 15,866
(Notes are included on the following page)
General Fund Overview
(a) Projected increase based on prior year and first disbursement, approximately 3.8% increase in overall performance. (b) Increase based on exceptional performance and inflation that was prevalent at the mid-year adjustment. (f) FY 21/22 includes approx. $300,000 in permit revenues related to a major project, this was reduced in FY 22/23 to reflect on-going operations.
A corresponding reduction in Community Development fees for contract services is also projected. (g) Based on estimated grant revenues in the Community Development Department, with corresponding increase in grant expenses. (h) Due to COVID-19, some recreation activities, special events, and parking meter collections were phasing-in throughout FY 21/22.
The FY 22/23 budget represents a full-year of revenues at regular activity levels and updated fee schedule rates. (k) Reflects the use of ARPA funds to supplement operations. In FY 22/23, the remaining ARPA balance will be appropriated at a later time. (l) In FY 21/22, approx. $181,000 was included for the Measure A ballot measure. In Fiscal Year 22/23, this amount was not needed. (m) Estimated legal costs based on current year and anticipated services. (n) Establishes a new Economic Development Department, with costs that were previously in the City Manager and CDD department budgets. (o) Receives a higher share of unfunded liability pension costs and internal service charges, 3% COLA, and parking study. In FY 21/22 there was also an Officer and CSO vacancy. FY 22/23 assumes full staffing and overtime costs; and step increases for relevant positions. (p) Primarily related to an anticipated increase in fire service contract costs and rising unfunded liability allocations. (q) Receives a higher share of unfunded liability pension costs and internal service charges, assumes full-staffing, 3% COLA, Monarch Sanctuary Maint. and Long-Term Management Plan combined at $35,000, purchase of $35,000 in trees, rising maintenance/repair costs. (r) Increased utility costs, full-staffing, increased benefit election, 3% COLA, and additional contract costs that are reimbursed through fees. (s) Prior year ARPA funds for projects were allocated to the General Fund and transferred to the CIP Fund. FY 22/23 includes the transfer of $876,737 in water entitlement transfers to the Local Water Project Fund. (c) Includes $975,000 in Measure A revenues and reflects increased performance. Based on HdL estimates and internal evaluation. (d) Increased based on year to date performance and projected underlying rate increases and consumption. (i) In prior years, there were significant one-time code enforcement revenues. In FY 22/23, the amount is aligned with FY 20/21 and FY 21/22. (j) The primary variance relates to proceeds from water entitlement promissory notes of $625,187 and $151,550, respectively. (e) In FY 20/21, real estate transfer taxes nearly doubled. This trend continued into the current year and is projected to extend into FY 22/23.
Notes
ORDINANCE NO. xx-xxx
ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PACIFIC GROVE
ADOPTING THE OPERATING AND CAPITAL PROJECTS BUDGET FOR THE FISCAL YEAR (FY) 2022-23; AND AMENDING THE OPERATING AND CAPITAL PROJECTS BUDGET FOR FISCAL YEAR 2021-22
FACTS
1. The City Council held a public hearing and first reading of an ordinance to adopt the FY 2022-23 Operating and Capital Projects Budget; and amend the FY 2021-22 Operating and Capital Projects Budget.
2. The City Manager is recommending adoption of the FY 2022-23 Budget to reflect the City Council’s expressed goals for the fiscal year budget; and approve changes for the FY 2021-22 Operating and Capital Budget.
3. Pursuant to Charter Article 15, adoption of the annual budget and or amendment of the budget must be approved by ordinance.
4. In the enactment of this ordinance, the City followed the guidelines adopted by the State of California and published in the California Code of Regulations, Title 14, Section 15000, et seq.
5. Enactment of this ordinance action does not constitute a “project” as defined by California Environmental Quality Act (CEQA) Guidelines Section 15378 because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment.
NOW, THEREFORE, THE COUNCIL OF THE CITY OF PACIFIC GROVE DOES ORDAIN AS FOLLOWS:
SECTION 1. The foregoing recitals are adopted as findings of the City Council as set forth fully within the body of this ordinance.
SECTION 2. The FY 22-23 appropriated budgets for the General Fund are adopted as follows:
Revenues Expenditures
Revenues $30,580,119
Expenditures
City Council $ 385,227
City Manager 1,230,107
Economic Development 124,833
City Attorney 762,100
Finance 1,392,325
Information Services 870,666
Community Development 2,813,339
Police 7,928,629
Fire 4,246,200
Public Works 4,239,165
Library 1,125,728
Museum 314,500
Recreation 920,638
Non-Departmental
Debt Service 2,237,415
Capital Outlay 145,000
Capital Project Transfers 575,000
Other Transfers 1,100,737
Total General Fund $ 30,580,119 $30,411,609
SECTION 3. The FY 2022-23 appropriated budget for the Enterprise Funds are adopted as follows:
SECTION 4. The FY 2022-23 appropriated budget for the Internal Service Funds are adopted as follows:
SECTION 5. The FY 2022-23 appropriated budget for the Permanent Funds are adopted as follows.
SECTION 6. The FY 2022-23 appropriated budget for the Capital Improvement Funds are adopted as follows.
Enterprise Funds Revenues Expenditures
Cemetery $ 636,750 $ 576,258
Golf 386,500 307,097
Local Water Project 1,451,737 1,373,448
Sewer 4,313,135 3,644,886
Total Enterprise Funds $ 6,788,122 $ 5,901,689
Revenues Expenditures
Internal Service Funds
Employee Benefits $ 341,050 $ 341,000
Liability Insurance 543,000 544,239
Other Post Employment Benefits - -
Workers Compensation 746,600 751,264
Total Internal Service Funds $ 1,630,650 $ 1,636,503
Revenues Expenditures
Permanent Funds
Cemetery Endowment $ 64,000 $ -
Library Endowment 2,500 -
Yount Trust 7,500 7,500
Total Permanent Funds $ 74,000 $ 7,500
Capital Improvement Fund Revenues Expeditures
Building & Facilities Improvement $ - $ -
General Fund CIP 1,151,664 1,400,453
$ 1,151,664 $ 1,400,453
SECTION 7. The FY 2022-23 appropriated budgets for the Special Revenue Funds and are adopted as follows.
SECTION 8. The FY 22-23 appropriated budgets for the General Fund Sub-Funds are adopted as follows.
General Fund Sub Funds Revenues Expenditures
Asset Seizure 50 -
Civic Center Site - -
Drug Awareness (DARE) 1,150 292
Hyperbaric Chamber 10,600 22,000
Koo Estate Donation 900 7,000
Operating Donations 3,600 -
Recreation Donation Fund 1,300 -
Stillwell Children's Pool 400 15,000
Vehicle Replacement - -
Total General Fund Sub-Funds $ 18,000 $ 44,292
Special Revenue Funds Revenues Expenditures
American Rescue Plan $ 1,848,559 $ 1,000,000
ASBS Grant - -
Cal Home Reuse 27,000 24,000
Carillon 100 -
CDBG Grant 112,000 470,000
CDBG 2017 Grant Fund - -
Chautaqua Hall 150 -
Coastal Conservancy Grant 600 -
Coronavirus Relief Fund - -
Downtown Business District 24,000 24,000
Environmental Enhancement 800 -
Fire Emergency Equipment 19,650 22,000
Gas Tax Fund 441,800 456,539
General Plan Maintenance Fee Fund 7,000 -
Hospitality Improvement District 500,000 500,000
Housing Fund 75,000 216,181
Library Building and Equipment 58,200 38,000
Lighthouse Fund 97,250 155,708
Library Book Donations 40,000 40,000
Local Streets and Roads 774,992 896,304
McIndoo Donation 500 17,529
Museum Improvement 3,000 115,000
Operating Grants 20 -
Poetry Promotion 36,120 9,700
Public Safety Augmentation 376,500 404,015
Regional Surface Trans. (RSTP) 1,000,000 1,000,000
RMRA 355,638 354,138
Senior Housing - -
Sewer Lateral Loans 11,500 -
Small Business Grant Fund - -
State Franchise PEG 59,500 53,000
Strong Fund Disbursements 41,000 102,074
Supplemental Law Enforcement 162,000 228,841
Vehicle Abandonment 12,250 -
Yount Income 8,300 4,000
Total Special Revenue Funds $ 6,093,429 $ 6,131,029
SECTION 9. The FY 2021-22 appropriated Budget is amended to reduce or increase the budgets in the funds listed below, as follows.
SECTION 10. The Fiscal Year 22/23 estimated revenues, expenditures, and ending fund balances are referenced herein:
Est. FY 22/23
Beginning Revenues Expenditures
Est. FY 22/23
Ending
General Fund
General Fund $ 9,854,161 $ 30,580,119 $ 30,411,609 $ 10,022,671 Asset Seizure 1,838 50 - 1,888
Civic Center Site 1,594 - - 1,594
Drug Awareness (DARE) 290 1,150 292 1,148
Hyperbaric Chamber 15,130 10,600 22,000 3,730
Koo Estate Donation 7,000 900 7,000 900
Operating Donations 66,240 3,600 - 69,840
Recreation Donation Fund 28,038 1,300 - 29,338
Stillwell Children's Pool 53,451 400 15,000 38,851
Vehicle Replacement 60,386 - - 60,386
General Fund Types $ 10,088,128 $ 30,598,119 $30,455,901 $ 10,230,346 Capital Improvement Fund
Building & Facilities Improvement $ - $ - $ - $ -
General Fund CIP 437,480 1,151,664 1,400,453 188,691
$ 437,480 $ 1,151,664 $ 1,400,453 $ 188,691
Internal Service Funds
Employee Benefits $ 25,545 $ 341,050 $ 341,000 $ 25,595 Liability Insurance 16,141 543,000 544,239 14,902
Other Post Employment Benefits - - - -
Workers Compensation 103,672 746,600 751,264 99,008
Total Internal Service Funds $ 145,358 $ 1,630,650 $ 1,636,503 $ 139,505 Enterprise Funds
Cemetery $ 698,111 $ 636,750 $ 576,258 $ 758,603
Golf 2,806,792 386,500 307,097 2,886,195
Local Water Project 1,296,947 1,451,737 1,373,448 1,375,236 Sewer 20,942,611 4,313,135 3,644,886 21,610,860
Total Enterprise Funds $ 25,744,461 $ 6,788,122 $ 5,901,689 $ 26,630,894 General Fund Revenues Expenditures
01-4402 Zoning Enforcement $ 119,000
01-10-5201 Contract Services 181,033
General Fund CIP Fund Revenues Expenditures
Public Works Fire Repair Project - $ (787,500)
Est. FY 22/23
Beginning Revenues Expenditures
Est. FY 22/23
Ending
Special Revenue Funds
American Rescue Plan $ - $ 1,848,559 $ 1,000,000 $ 848,559 ASBS Grant - - - -
Cal Home Reuse 159 27,000 24,000 3,159
Carillon 9,828 100 - 9,928
CDBG Grant 366,518 112,000 470,000 8,518
CDBG 2017 Grant Fund - - - -
Chautaqua Hall 41 150 - 191
Coastal Conservancy Grant 84,133 600 - 84,733
Coronavirus Relief Fund - - - -
Downtown Business District 873 24,000 24,000 873
Environmental Enhancement 115,819 800 - 116,619
Fire Emergency Equipment 158,214 19,650 22,000 155,864
Gas Tax Fund 141,247 441,800 456,539 126,508
General Plan Maintenance Fee Fund 12,482 7,000 - 19,482 Hospitality Improvement District 179 500,000 500,000 179 Housing Fund 248,006 75,000 216,181 106,825
Library Building and Equipment 18 58,200 38,000 20,218
Lighthouse Fund 175,830 97,250 155,708 117,372
Library Book Donations 34,575 40,000 40,000 34,575
Local Streets and Roads 687,928 774,992 896,304 566,616 McIndoo Donation 26,885 500 17,529 9,856
Museum Improvement 345,128 3,000 115,000 233,128
Operating Grants 740 20 - 760
Poetry Promotion 93,277 36,120 9,700 119,697
Public Safety Augmentation 105,073 376,500 404,015 77,558 Regional Surface Trans. (RSTP) - 1,000,000 1,000,000 -
RMRA 182,098 355,638 354,138 183,598
Senior Housing 10,450 - - 10,450
Sewer Lateral Loans 155,867 11,500 - 167,367
Small Business Grant Fund 1,613 - - 1,613
State Franchise PEG 79,014 59,500 53,000 85,514
Strong Fund Disbursements 61,075 41,000 102,074 1
Supplemental Law Enforcement 76,085 162,000 228,841 9,244 Vehicle Abandonment 47,366 12,250 - 59,616
Yount Income - 8,300 4,000 4,300
Total Special Revenue Funds $ 3,220,521 $ 6,093,429 $ 6,131,029 $ 3,182,921 Permanent Funds
Cemetery Endowment $ 1,882,512 $ 64,000 $ - $ 1,946,512 Library Endowment 539,807 2,500 - 542,307
Yount Trust 842,855 7,500 7,500 842,855
Total Permanent Funds $ 3,265,174 $ 74,000 $ 7,500 $ 3,331,674 Est. Ending Fund Balance - All Funds $ 42,901,122 $ 46,335,984 $45,533,075 $ 43,704,031 SECTION 11. The Fiscal Year 21/22 estimated revenues, expenditures, and ending fund balances are adjusted for this amendment are referenced herein:
SECTION 11. In accord with Article 15 of the City Charter, this ordinance shall become effective upon adoption hereof.
PASSED AND ADOPTED BY THE COUNCIL OF THE CITY OF PACIFIC GROVE this 15th day of June, 2021, by the following vote:
AYES:
NOES:
ABSENT:
APPROVED:
________________________
BILL PEAKE, Mayor
ATTEST:
_________________________________
SANDRA KANDELL, City Clerk
APPROVED AS TO FORM:
_________________________________
DAVID C. LAREDO, City Attorney
FY 21/22
Beginning Revenues Expenditures
Est. FY 21/22
Ending
General Fund $ 9,441,669 $ 28,469,159 $ 26,919,108 $ 9,854,161 General Fund CIP 220,023 2,780,146 2,562,689 437,480
Fund Title
Ordinance to Approve the Fiscal Year 22/23
Operating and Capital Improvement Budget;
and
Amend the Fiscal Year 21/22 Operating and Capital
Improvement Budget
6/1/2022 Tori Hannah, [email protected] 1
Budget and Financial Calendar
Month Topic
April 6 Received Mid-Year Financial Update
April 20 Adopted the Master Fee Schedule for Fiscal Year 22/23 May 4 Provided the Five-Year Forecast and Budget Work
May 4 Received Financial Information on the Local Water Project Business Plan May 11 Received and Approved the Fiscal Year 22/23 Capital Improvement Plan May 18 Presented ARPA Survey Results and Project Direction June 1 First Reading of an Ordinance to Adopt Fiscal Year 22/23 Budget June 15 Second Reading of an Ordinance to Adopt Fiscal Year 22/23 Budget 6/1/2022 Tori Hannah, [email protected] 2
General Fund Overview
Fiscal Year FY 21/22
Adopted
FY 21/22
Estimated
FY 22/23
Proposed
Proposed to
Adopted
Begin. Fund Bal. $ 9,441,669 $ 9,441,669 $ 9,854,161 -
Revenues $ 26,847,000 $ 28,650,159 $ 30,580,119 3,733,119 Expenses
Operating $ 23,840,877 $ 24,635,637 $ 26,353,457 $2,512,580 Capital Outlay 5,000 113,053 145,000 140,000
Debt Service 2,170,418 2,170,415 2,237,415 66,997
CIP Transfers 500,000 701,173 575,000 75,000
Transfers Out 150,000 617,386 1,100,737 950,737
Total Expenses $ 26,666,295 $ 28,237,667 $ 30,411,609 $ 3,745,314 Net Difference 180,705 412,492 168,510
Ending Fund Bal. $ 9,622,374 $ 9,854,161 $ 10,022,671
(1) The Beginning Fund Balance was updated to reflect the audited financial statements for the General Fund Operating Fund. The sub-funds were excluded. They typically have minimal activity 3 Pages
49-65 and
Attachment
General Fund Reserve Target
Fiscal Year 21/22 Percent Amount
Estimated ending general fund operating balance $10,023,000 Operating Expense $26,354,000
Debt Service 2,237,000
Subtotal $28,591,000
Reserve Calculation:
Cash Flow 20% $5,718,000
Fiscal Stability 10% 2,859,000
Contingency 5% 1,430,000
Minimum Policy Limits 35% $10,007,000
Difference from Target $16,000
Tori Hannah, [email protected] 4
ARPA Funds
City Qualification Category:
Replace Lost Public Sector Revenue
Fiscal Year 21/22 Allocation:
Eliminate furlough/restore positions
Reinstate program funding
Fund capital improvements and equipment
Proposed Allocation
General Fund: $1 million
Retained in ARPA Fund: $849,000
(To be allocated at a forthcoming meeting)
6/1/2022 Tori Hannah, [email protected] 5
54%
46%
FY 22/23 ARPA Funds
Estimated Allocation to General Fund
Unallocated
$1.84
Million
Page
125
Key General Fund Items
Revenues
Measure A sales tax revenues for ¾ of the year: $975,000 Contribution from the American Rescue Plan Act (ARPA) Fund: $1 million Proceeds from water entitlement promissory notes: $776,737 Expenditures
Adding 1.50 regular FTE’s for two ¾ time Librarians: Cost neutral Rising CalPERS unfunded liability costs: $406,000
Incorporating a cost of living adjustment for all employees: $300,000 Increasing legal services: $379,000; or $134,000 when compared to Est./Amended Rising fire service contract costs of $141,000
Implement a compensation study for Unrepresented/Dept. Head groups: $140,000 (For positions that have not been studied since 2017)
Transferring water entitlement sales to the Local Water Project: $876,737 Funding CIP project transfers and capital purchases: $720,000 Tori Hannah, [email protected] 6
Pages
49-57 and
attachment
General Fund Revenues: $30.6 Million 1
Increase of $3.7 million or 14% over FY 21/22 Adopted; or 1.9 million or 6.74% over Est./Amend. 6/1/2022 Tori Hannah, [email protected] 7
Property Tax Trends
6/1/2022 Tori Hannah, [email protected] 8
$5.6 $5.8 $6.1
$6.4
$6.8
$7.3
$7.6
$8.2
$8.5 $8.8
$0
$1
$2
$3
$4
$5
$6
$7
$8
$9
$10
13/14 14/15 15/16 16/17 17/18 18/19 19/20 20/21 21/22 Est. 22/23 Budget
Millions
Transient Occupancy Tax Trends
6/1/2022 Tori Hannah, [email protected] 9
$3.3 $3.7 $3.8 $3.8 $4.0 $4.3 $3.6 $3.0
$4.5
$4.7
$0.5
$0.7 $1.0 $1.2
$1.8 $1.8
$1.2
$0.6
$1.2 $1.2
0 1
2 3
4 5
6 7
13/14 14/15 15/16 16/17 17/18 18/19 19/20 20/21 21/22
Est
22/23
Budget
Millions
(Excludes licenses and application fees)
Commercial Residential
Sales Tax Trends
Approximately $975,000 Estimated from Measure A
6/1/2022 Tori Hannah, [email protected] 10 $3.3 $3.5 $3.3
$4.1
$3.6
$4.1 $3.9 $4.1 $4.3
$5.6
$-
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
13/14 14/15 15/16 16/17 17/18 18/19 19/20 20/21 21/22 Est. 22/23 Budget
Millions
Sales Tax Trends
General Fund Expenditures: $30.4 million |
Increase of $3.7 million or 14% over FY 21/22 Adopted; or $2.5 million or 10.5% above Est./Amend. 6/1/2022 Tori Hannah, [email protected] 11 Salaries
39%
Unfunded PERS
Liability
12% Services, Supplies
and Others
36%
Capital Outlay
0.5%
Capital Project
Transfers
2%
Debt Service, POB
7% Interfund Transfers
3.5%
FY 22/23
Expenditures by Major Category
Expenditures by Major Category
6/1/2022 Tori Hannah, [email protected] 12 $12.5 $12.2 $13.9 $15.5
$8.1 $8.2
$10.7
$10.8
$2.0
$2.1
$2.2
$2.2
$0
$5
$10
$15
$20
$25
$30
$35
FY19/20 Actual FY20/21 Actual FY21/22 Estimated FY22/23 Budget Millions
Salaries Services, Supplies and Others Capital Outlay
Capital Projects Debt Service Interfund Transfers
Pages 57
$3.7
CalPERS
Unfunded
Liability
Forecast Information
References Proposed FY 22/23 budget estimates as basis General Forecast Information
Reveals revenue & expenditure trends over time
Assumes no other events intervene
Economic recession, natural disaster, loss of major taxpayers Unanticipated revenues or expenses
Identify outcomes if nothing changes
Provides an “Order of Magnitude” feel for General Fund’s ability to continue services and preserve fiscal sustainability Should be viewed as a “Work in Progress”
Five-Year Forecast
Avg. unprogrammed funds for FY 23/24 to FY 26/27: $639,000 or $500,000 with reserves 6/1/2022 Tori Hannah, [email protected] 14 $28.2
$30.4
$28.8
$29.6 $30.3 $31.1 $26.6
$29.6
$29.4
$30.2
$31.0
$31.8
$2.0
$1.0
$24
$25
$26
$27
$28
$29
$30
$31
$32
$33
FY 21/22 FY 22/23 FY 23/24 FY 24/25 FY 25/26 FY 26/27
Millions
Expenditures Revenues ARPA
Measure A, ARPA supplement,
increased expenses
Reduction in pension bond payments
ARPA &
supplement
Capital Outlay: $203,000
General Fund: $145,000
Cybersecurity assessment
Hybrid patrol vehicle
New generator (partially funded by Sewer Fund)
Two street light poles
Other Funds: $58,000
Fiber connection from City to AMP location
Library self check-out equipment
Cemetery data connection
New generator (partially funded by the General Fund)
Tori Hannah, [email protected] 15
Page
164
Partial List of Projects
Total Projects: $5.2 million
Detailed Projects on Budget Pages: XXXXX
Project Title Amount
Fiscal Year 22/23 Street Rehabilitation Project $ 1,300,442 Cedar, Sunset and Congress Intersection Improvements 1,000,000 Phase 9 Sewer Improvements 850,000
Public Works Fire Repair Project 787,500
David Street Rehabilitation 400,000
Fiscal Year 22/23 Crack and Slurry Seal 300,000
Del Monte Storm Drain Project 150,524
15.5 Pump Station Replacement 110,000
Pacific Grove Museum of Natural History Mezzanine Upgrades 75,000 Point Pinos Lighthouse Roof Repair 60,000
$ 5,033,466
Tori Hannah, [email protected] 16
Pages
166-187
Enterprise Funds
Est. Beginning
Fund
Balance
Revenues Expenditures
/ Transfers
Projected
Ending Fund
Balance
Cemetery $ 698,111 $ 636,750 $ 576,258 $ 758,603
Golf 2,806,792 386,500 307,097 2,886,195
Local Water Project 1,296,947 1,451,737 1,373,448 1,375,236 Sewer 20,942,611 4,313,135 3,644,886 21,610,860
Combined $25,744,461 $6,788,122 $5,901,689 $26,630,894
Tori Hannah, [email protected] 17
Pages
97-100
Projected FY 22/23 Ending “Available Fund Balance”
Cemetery: $522,000 | Golf course: $89,000 | Local Water Project: $30,400 | Sewer: $6M Internal Service Funds
Beginning
Fund Bal.
Revenues Expenditures
/ Transfers
Projected
Ending Fund
Bal.
Employee Benefits $ 25,545 $ 341,050 $ 341,000 $ 25,595 Liability 16,141 543,000 544,239 14,902
OPEB - - - -
Workers Comp 103,672 746,600 751,264 99,008
Combined $ 145,358 $ 1,630,650 $ 1,636,503 $ 139,505
Tori Hannah, [email protected] 18
Pages
113-117
Internal Service Funds with Reserve/Fund Balance Requirements:
Works Comp. Fund
Liability Fund
City Council
City of Pacific Grove
Questions?
6/1/2022 Tori Hannah, [email protected] 19