PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.F
SUBJECT/TITLE:
FISCAL YEAR 2024 APPROPRIATIONS LIMIT (GANN LIMIT) FOR THE CITY OF
PISMO BEACH
RECOMMENDATION:
Adopt a Resolution accepting the Fiscal Year 2024 Appropriations Limit for the City of Pismo Beach.
EXECUTIVE SUMMARY:
The California State Constitution requires that government entities calculate and adopt an appropriations limit each year to ensure that expenses don't grow greater than allowed by law.
California Constitution Article 13B, Section 1 provides that “The total annual appropriations subject to limitation of the State and each local government in the Constitution of the State of California, Article 13B Government Spending Limitation, shall not exceed the appropriations limit of the entity of government for the prior year adjusted for the change in the cost of living and the change in population, except as otherwise provided in this article.”
The Council set the Appropriations Limit for Fiscal Year (FY) 2023 at $31,743,067. In a letter dated May 2023, the State Department of Finance (Attachment 2) informed all cities that the percentage change in the California Per Capita Personal Income that can be used for the “change in the cost of living” factor for FY 2024 is 4.44%, that the percent change in Pismo Beach’s population to be used for FY 2024 shall be a -1.17% decrease (from 7,958 to 7,865), and that the percent change in San Luis Obispo County’s population to be used for FY 2024 is a -0.50% decrease. Adjusting the FY 2023 Appropriations Limit by the above percentage changes in California Per Capita Personal Income, and in the San Luis Obispo County population, yields an Appropriations Limit of $32,985,168 for FY 2024 (see calculations, Attachment 1A).
The FY 2024 appropriations that are subject to this Limit amount to $27,800,754, which is below the FY 2024 Appropriations Limit of $32,985,168 by $5,184,415.
Conclusion and Recommendation
Staff recommends that the City Council adopt a Resolution (Attachment 1) to approve the Gann Limit for FY 2024.
FISCAL IMPACT:
None, as FY 2024 appropriations subject to Gann Limit are below the calculated Gann Limit.
9.F-1Council Agenda 6-6-2023
ALTERNATIVES:
1. Propose different calculation factors, and recalculate the FY 2024 Gann Limit.
ATTACHMENTS:
1. Resolution
1.A. Exhibit A to Resolution: Appropriations Limit Calculation Worksheet
2. May 2023 Letter from State Dept of Finance Price and Population Letter Meeting Date: June 6, 2023 Submitted by:
Nadia Feeser, Administrative Services Director
Interim City Manager Approval:
9.F-2Council Agenda 6-6-2023
RESOLUTION NO. R-2023-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH, CALIFORNIA ACCEPTING THE FISCAL YEAR 2024 APPROPRIATIONS LIMIT FOR
THE CITY OF PISMO BEACH
WHEREAS, Article XIII-B of the California Constitution provides that the total annual appropriations subject to limitation of each governmental entity shall not exceed the Appropriations Limit of such governmental entity for the prior year, adjusted for changes in population and inflation as mandated by Proposition 4 (commonly called the “Gann Limit”), passed in November 1979, and Proposition 111, passed in June 1990, except as otherwise provided for in said Article XIII-B and implementing State statutes; and WHEREAS, pursuant to Article XIII-B of said California Constitution, and Section 7900 et seq. of the California Government Code, the City is required to set its Appropriations Limit for each fiscal year; and
WHEREAS, the State Department of Finance has provided the required information on the change in California Per Capita Personal Income and on the change in population for the County of San Luis Obispo to be used for adjusting the FY 2023 Appropriations Limit to calculate the FY 2024 Appropriations Limit; and
WHEREAS, the City has used the change in California Per Capita Personal Income and change in San Luis Obispo County population data provided by the State Department of Finance in May 2023 to calculate the FY 2024 Appropriations Limit, and, pursuant to Section 7910 of California Government Code, has made available to the public the documentation used to calculate the FY 2024 Appropriation Limit (provided as Exhibit A).
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Pismo Beach that said Appropriation Limit for Fiscal Year FY 2024 shall be set in the amount of $32,985,168.
UPON MOTION OF Council Member , seconded by Council Member , the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 6th day of June 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
RECUSED:
Approved: Attest:
________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk
9.F-3Council Agenda 6-6-2023
Attachment 1
City of Pismo Beach
Appropriations Limit Calculation Worksheet
For
Fiscal Year 2023-2024
FY 2023 Appropriations Subject to Limit 28,874,106$
APPROPRIATION LIMIT CALCULATION
Item #
1 FY 2023 Appropriation Limit 31,743,067$
2 Population Factor - San Luis Obispo County X 0.994953914 3 Subtotal = 31,582,888$
4 California Per Capita Personal Income Factor X 1.0444000 5 Total Adjustment %X 1.0391299
6 FY 2024 APPROPRIATION LIMIT (3) X (4) 32,985,168$
7 Annual Adjustment in Dollars (1) X (5)1,242,102$
8 FY 2024 Appropriations Subject to Limit 27,800,754$
9 Over (Under) Limit (5,184,415)$
9.F-4Council Agenda 6-6-2023
Attachment 1.A
9.F-5Council Agenda 6-6-2023
Attachment 2
9.F-6Council Agenda 6-6-2023
Attachment 2
9.F-7Council Agenda 6-6-2023
Attachment 2