TO: CITY COUNCIL
VIA: CITY ADMINISTRATOR
Placentia City Council
FROM: INTERIM DIRECTOR OF FINANCE
DATE: MARCH 1, 2022
SUBJECT: MID -YEAR BUDGET REPORT
FISCAL
IMPACT:
Fund
General Fund
Special Revenue
Internal Service
Other Agencies
SUMMARY:
Revenues
(Including Transfers -In)
$9,786,038
$5,300,845
$441,035
$0
Total $15,527,918
Appropriations
(Including Capital &
Transfers -Out)
$9,022,076
$5,596,046
$472,865
$22,571
$15,113,558
Upon the deliberation and adoption of the Fiscal Year 2021-22 Budget, Staff indicated that due to the unknown effects of COVID-19, Staff would establish a conservative General Fund operational budget and present comprehensive quarterly reports. This mid -year report is developed and presented to the Council to provide the most current information on the financial activities of the City on which to base decisions. Additionally, these types of quarterly reports assist City departments in communicating their financial operations throughout the fiscal year including any program changes and significant impacts to their annual budgets, as well as gauging the City's budget plan as compared to actual revenue and expenditures. This report includes requested departmental budget adjustments and preliminary year-to-date actuals covering the period through January 31, 2022.
RECOMMENDATION:
It is recommended that the City Council take the following actions:
Approve Resolution No. R-2022-10, a Resolution of the City Council of the City of Placentia, California authorizing a budget amendment in Fiscal Year 2021-22 in compliance with City Charter of the City of Placentia Section 1206 pertaining to appropriations for actual expenditures; and
3. b.
Mar. 1, 2022
City Council Agenda
March 1, 2022
• Measure U Transfers -In — an increase of $245,600 due to revised estimates based upon actuals to date.
General Fund _
Department
Legislative
Administration
Finance
Development Services
Public Safety- Police
Public Safety - Animal Control
Fire & Life Safety
Public Works
Community Services
General Government
Debt Service
Total Departme
Capital Improvement Program
Transfers Out
Total Requireme
Budgeted Requirements
Amended Requested
1/31/2022 Adjustment TProposed
1,082,623
8,806,750 9,353,620
- 53,000
9,022,076 50,677,218
45,000
1,127, 623
5,377,193
3,996
5,381,189
1,307,688
(15,793)
1,291,895
1,367,728
152,219
1,519,947
11, 860, 565
64,860
11, 925, 425
4,352,188
8,806,750 9,353,620
- 53,000
9,022,076 50,677,218
(340, 394)
4,011,794
4,195,105
167,280
4,362,385
2,375,500
134,160
2,509,660
4,388,382
-
4,388,382
4,748,300
4,000
_ 4,752,300
41,055,272
215,326
41,270,598
546,870
53,000
8,806,750 9,353,620
- 53,000
9,022,076 50,677,218
41,655,142
Expenditure budget adjustment requests include the following:
• Legislative — An increase in expenditures of $45,000 is due to anticipated increase of costs related to legal review of redistricting, hiring a demographer to redraw districts and anticipated litigation.
Administration — a net increase in expenditures of $3,996 due to net changes salaries and benefits of $(102,404) resulting from an adjustment of known vacancies in approved positions and changes due to new MOU agreement between bargaining units. Additionally due to staff turnover and labor negotiations an increase of $78,000 is requested for management consultant services. An increase of $8,000 to cover outstanding commitments and $20,000 for technology purchases.
e Development Services — a net increase of $152,219 due to a $97,219 net salary and benefits adjustment resulting from new MOU agreements and known vacancies, Fire plan check services of $20,000 which are backed by City fees, and $35,000 for department contract services for plan checks backed by fees.
• Public Safety — Police — a net increase in expenditures of $64,860 due to a net decrease of $86,640 salary and benefits adjustment resulting from new MOU agreements and known
City Council Agenda
March 1, 2022
vacancies, an additional $150,000 of Overtime due to vacancies, and Postage of $1,500 to ship back rifles to the Federal Government.
■ Fire & Life Safety — a net decrease in expenditures of $(340,394) due to new MOU agreements and known vacancies.
■ Public Works — a net increase in expenditures of $167,280 due to an increase of $11,890 resulting from new MOU agreements and known vacancies, $15,000 for CASPs/ADA inspections, $25,000 for assistance with traffic maintenance software, $5,000 for new decorative street signs, $50,000 for building upgrades/repairs, $10,300 for software utilized at the City yard, and $50,000 for repairs to the City's fleet. ■ Community Services — a net increase of $134,160 consists of net salary and benefits adjustment of $47,210 for new MOU agreements and known vacancies, $72,550 for repair and maintenance/facilities expense for required park, irrigation and landscaping repairs, $1,000 for office supplies, and $3,400 for new community furniture • Capital Improvement Program — an increase in expenditures of $8,806,750 due to obtaining the final ruling for ARPA that allowed the City to take the full ARPA allocation as revenue loss for the City. Significant projects that were added include $3,829,677 for TOD/Crowther Sewer Project, $2,000,000 City Hall HVAC replacement, $400,000 Civic Center Solar and Storage project, $600,000 City Hall roof replacement, $560,000 Public Safety Building design, and $600,000 for Senior/Community Center designs.
Special Revenue Funds: The Special Revenue Fund 2021-22 Amended Budget as of January 31, 2022 includes net revenues of $25.4 million and expenditures of $31.2 million. The proposed budget adjustments in the 2021-22 Mid -Year Budget Report include an increase in net revenues of $5.3 million and an increase in net expenditures of $5.2 million. Approval of this item will result in a net increase of $144,799 in the Special Revenue Fund budgetary fund balance. Notable adjustments include:
COVID-19 Relief —an increase in revenue of $4,544,465 for unearned revenue from FY20- 21 recognized in the current year. With the final ARPA ruling, the City is able to claim up to its allocation as revenue loss, thus $9.0 million will be transferred to the General Fund as revenue loss.
■ Measure U — an increase in revenue of $614,000 due to a forecast based on actuals year- to-date. An increase in expenditures of $365,600 to transfers out based on Policy 460, $250,000 for Main St Parking Lot improvements and $90,000 for Hazard Mitigation plan.
Miscellaneous Grants Fund — a net fund change of $55,880 is due to revenues of $280,000 related to the OCTA grant for the Bicycle Corridor project, CalTrans Public Art program $70,000 and $100,000 grant permit tracking software that was not carried over from prior year. A decrease of revenue and expenditures of $(276,600) for the STRONG grant was removed until the City receives the final approval letter.
City Council Agenda
March 1, 2022
NOC — Public Safety Grant — an increase of $7,000 of revenue based on the final anticipated award of the grant and extension of the grant for two years. With the extension of the grant an increase of $122,366 of expenditures for one officer and program expense. • Quimby In Lieu — a decrease of $280,000 for the Bicycle Corridor project to be covered by OCTA grant.
Internal Service Funds: The Risk Management internal service fund 2021-22 Amended Budget includes revenues and expenditures of $1.7 million. The proposed budget adjustment in the 2021- 22 Mid -Year Budget Report includes an increase in revenues of $441,035 and an increase in expenditures of $441,035, and approval of this item will result in any changes in the Risk Management budgetary fund balance.
Classification Actions: The 2021-22 Mid -Year Budget Report includes the following classification actions:
• Addition of one (1) Director of Human Resources, one (1) Risk Manager and one (1) IT Manager.
■ Reclassification of one (1) Part Time HR Clerical Aide to one (1) Full Time HR Office Clerk • Reclassification of one (1) Human Resource Tech to one (1) Senior Human Resource Tech
• Reclassification of one (1) Human Resource Analyst to one (1) Senior Human Resource Analyst
• Reclassification of one (1) Office assistant (City Clerk) to one (1) Administrative Specialist • Reclassification of one (1) Office Assistant (Administration) to one (1) Administrative Assistant.
• Reclassification of one (1) IT Management Analyst to one (1) IT Tech - GIS Staff does not anticipate the need for additional funding in this Fiscal Year. Adequate funding is available in the subsequent Fiscal Years to cover the costs of the positions mentioned above.
Following the approval of the 2021-22 Mid -Year Budget Report which includes the associated required budget appropriation for the positions added above, Staff will return to Council for approval of an amended Position Allocation Plan to encompass all the classification actions above.
FISCAL IMPACT:
The fiscal impact associated with the approval of this item is summarized below with the detailed budget adjustments as listed in Exhibit A (attached).
City Council Agenda
March 1, 2022
Revenues Appropriations
Fund (Including Transfers -In) (Including Capital &
_ Transfers -Out
General Fund $9,786,038 $9,022,076
Special Revenue $5,300,845 $5,439,464
Capital Projects $0 $0
Internal Service $441,035 $472,865
Other Agencies _ $0 $22,571
Total $15,527,918 1 $15,113,558
Based upon preliminary 2021-22 projections, it is anticipated that the General Fund Reserve balance will increase by an additional $211,326 for a total available fund balance of $14.4 million of which $5.4 million of the reserve is above the 25% operating reserve goal This increase is mainly due to City Council's decision to uncommit funds set aside for the Metrolink Station. Should the City's forecast figures generally stay consistent with planned revenues and expenditures, the 2021-22 budget is on a structurally sound and fiscally sustainable path.
Prepared by:
Gavin Houn
Senior Financial Analyst
Reviewed and ed:
Damien R. Arrula
City Administrator
Attachments:
Reviewed and approved:
St Erlan
Interim Director of Finance
1. Mid -Year Budget Report
2. Resolution R-2022-10 — Authorizing a Budget Amendment in Fiscal Year 2021-22 a. Exhibit A — Detailed Budget Adjustments
3. Resolution R-2022-11 — Authorizing removal of Committed Fund balance designation of $3,400,000 from General Fund
4. Presentation — Mid -Year Budget Report