CIP Table 2: List of New Capital Projects
Project Amount Project Description Justification
Park Pathway Restoration
(Alviso Adobe & Tawny Parks) $150,000
Heavy rainfall and surface water flooding eroded the
decomposed granite pedestrian trail at Alviso Adobe
Park. Heavy rainfall for prolonged periods of time,
along with high winds damaged Tawny Park,
including causing a tree to fall. During debris removal activities, the adjacent sidewalk was cracked by
heavy equipment at Tawny Park. The project is
eligible for FEMA disaster relief funding. If approved
by FEMA up to 75 percent of the construction cost is
anticipated to be reimbursed by FEMA. The
estimated cost to repair the damaged parks’
pathways is $150,000. Winter Storm events in 2023
caused damage to the pathway at Alviso Adobe and
Tawny Parks. This project will restore the park’s
pathway to pre-disaster or better condition.
Storm event in 2023 caused
damage to the pathway at
Alviso Adobe and Tawny
Parks. This project will
restore the park’s pathway to
pre-disaster or better
condition.
Sycamore Creek Storm
Improvements (Sycamore
Road)
5,000,000
Sycamore Road at Sunol Boulevard experienced
localized flooding in 2017 and in 2023. Based on the
hydraulic analysis and feasibility study performed
under Project No. 24662, the storm drain line in
Sycamore Road may need to be replaced or a
secondary line added. The project would install
approximately 1,500 feet of 36- to 48-inch diameter
storm drain to provide additional capacity if analysis
warrants. The estimated costs to install a secondary
storm drain of similar size as the existing is
anticipated to cost approximately $5 million.
Sycamore Road at Sunol Boulevard experienced
localized flooding in 2017 and in 2023. To limit future storm damage, it is necessary to make storm drain
improvements at Sycamore Road.
Sycamore Road at Sunol
Boulevard experienced
localized flooding in 2017
and in 2023. To limit future
storm damages, it is
necessary to make storm
drain improvements at
Sycamore Road.
Foothill High School
Southbound Left Turn 471,578
The Pleasanton Unified School District submitted
plans to the Division of the State Architect (DSA) for
the construction of a new science building at Foothill
High School. The DSA required that the orientation of
the existing drop-off loop in front of the school be
reversed as part of the science building approval to
improve student safety. This project includes
modification of the traffic signals at Foothill High
School by moving the traffic signal from the middle of
the driveway to the north driveway and constructing a
second southbound left turn lane to provide increased
access into the school.
In 2003 the City constructed a
traffic signal at Foothill High
School and during that
process reversed the flow of
vehicles resulting in
passengers exiting vehciles
having to cross in front or
behind of the vehicle to
access the sidewalk. The
alterations to the traffic signal
and southbound left turn lane
are necessary safety
improvements.
7XUQRXW3UHSDFNDJH
Booster Station Procurement 1,300,000
This project will procure a prepackaged booster
pump station, replacing the existing Turnout No. 4
facilities located at the southwest corner of Hopyard
Road and Stoneridge Drive. The prepackaged
station will include a new enclosure, pumps, control
and systems, and integrate with the existing City
SCADA system. The system will be built off site,
delivered, and placed by crane between a new point
of connection of Zone 7’s supply and include a new
discharge piping installed under Project No. 24171.
Available pressure from Zone
7 has decreased with growth
of the Tri-Valley area and has
reduced the existing Turnout
No. 4 capacity to less than
1,000 GPM. The
replacement station is being
designed to meet future City
peak demand of up to 5,200
GPM.
Total $6,921,578
Existing Project Adjustments
As described in CIP Table 3 below, approximately $18.62 million is recommended to be added to existing capital projects for a Mid-Term total of $20.84 million. Additionally, $0.75 million in estimated capital project management expenses are recommended to be added. These expenses for capital project management are staffing costs that have been traditionally recorded at year-end, but to more accurately reflect overall costs in Water and Sewer Capital Funds staff recommends budgeting these costs as part of the annual budget process going forward. The $1.05 million in project reductions is due to budgeted revenues in restricted funds, including impact fee capital funds, not meeting expectations and revised estimates not sufficient to support adopted project budgets.
CIP Table 3: Existing Project Adjustments to the Mid-Term CIP FY 2024/25 Capital Project
Adopted
Budget
Recommended
Adjustments
Mid-Term
Budget Justification
ADA Transition Plan - $880,000 $880,000 Building assessment and ADA ramps Annual Storm
Repair/Replacement $125,000 1,625,000 1,750,000 Puri Court Storm Drain Improvements Annual Street Resurfacing &
Reconstruction 450,000 (50,000) 400,000
Budgeted revenues not meeting budget
expectations requiring project adjustment
Augustin Bernal Trail Creek
Crossing Culverts and Retaining
Wall - 992,000 992,000 Project construction funding
Bi-Annual Traffic Signal
Installations 750,000 (750,000) -
Budgeted revenues not meeting budget
expectations requiring project adjustment
City Ground Water Supply 3,500,000 - 3,500,000
Feasibility and final design phases for a joint
project with Zone 7 Water Agency to
construct new groundwater facilities
East Vineyard Detention Pond
Outfall Repair - 451,000 451,000 Project construction funding JDEDZ Transportation Fee
Reserve - 460,021 460,021 Fees collected for JDEDZ projects Motor Control Center
Replacement and Temporary
Power for Ken Mercer Sports
Park - 50,000 50,000 Rental of temporary power poles
Oak Tree Farm Outfall and
Channel Stabilization - 462,000 462,000 Project construction funding OSC Fire Alarm And Notification
System - 300,000 300,000
To accommodate scope based on revised
project estimates
Sassafras Court Storm Drain
Interceptor - 449,543 449,543
To aid in controlling debris and flows prior to
entering storm drain system
Sunol Boulevard Interchange
Improvements 350,000 (250,000) 100,000
Budgeted revenues not meeting budget
expectations requiring project adjustment
Sycamore Creek Storm Drain
Improvements 550,000 4,250,000 4,800,000 To mitigate future flooding issues Valley Ave Soundwall
Replacement - 250,000 250,000
For better hydraulic capacity and to reduce
risk of damage from future storms
West Las Positas Boulevard
Multimodal Reconstruction - 6,000,000 6,000,000
To accommodate scope funded with grant
funds
Total $2,225,000 $18,619,564 $20,844,564
Capital Project Management
(Water) $450,000 $450,000 -
Staffing costs associated with capital
project management
Capital Project Management
(Sewer) 296,740 - 296,740
Staffing costs associated with capital
project management
Total - $746,740 $746,740
FY 2025
Revenue Adjustments by Source
As described in CIP Table 4 below, the FY 2024/25 CIP Mid-Term Revenue by Source of approximately $33.24 million includes recommended adjustments of approximately $17.96 million, consisting of increasing General Funds Contribution by $0.47 million, $6.00 million of new grant funds, $13.77 million Transfers from Other Funds, and reductions of $2.20 million in other categories. In the City and Non-City Development Fees category, staff is estimating that the Capital Facilities Impact Fees, Traffic Impact Fees, and Tri-Valley Transportation fees will collectively be $2.06 million less than the adopted budget. In the Gas Tax, Measure B, BB & Highway Funds category, there is an estimated reduction for Gas Tax of approximately $0.21 million based on revised revenue projections from the League of California Cities, which uses the California Department of Finance’s latest numbers.
CIP Table 4: Revenue by Source Mid-Term CIP FY 2024/25
Below is the summary of recommended Mid-Term adjustments for FY 2024/25 Operating and Capital Budget:
x The FY 2024/25 General Fund revenue budget will decrease by $0.20 million; the General Fund expenditure budget will increase by $1.97 million. x All Other Operating Fund budgets for FY 2024/25 will increase revenues by $6.39 million; and increase expenditures by $1.65 million. x The FY 2024/25 Capital revenue budget will increase by $17.96 million; the Capital project budget will increase by $25.54 million.
For additional details, please refer to the Operating Budget Tables and Capital Budget Tables sections in this report.
CIP Revenue Sources
Adopted
Budget
Recommended
Adjustments
Mid-Term
Budget
Annual General Fund Contribution $2,000,000 $471,578 $2,471,578 City Development Fees 2,378,161 (1,560,593) 817,568
Gas Tax, Measure B,BB & Highway Funds 7,148,596 (213,031) 6,935,565 Grants and Miscellaneous 180,224 6,000,000 6,180,224
Non-City Development Fees (500,236) 574,714 74,478
Transfers from Other Funds 2,989,081 13,767,000 16,756,081 Total $15,270,776 $17,964,718 $33,235,494
OPERATING & CAPITAL BUDGET TABLES
FY 2024/25 Mid-Term Update
Budget Rec Mid-Year Budget Rec Mid-Year Budget Rec Mid-Year Revenues Adjustments Revenues Transfers Adjustments Transfers Expenditures Adjustments Expenditures General Fund
Rainy Day Fund -General Fund $151,442,025 ($203,250) $151,238,775 $496,152 $1,891,050 $2,387,202 ($151,963,438) ($1,966,067) ($153,929,505) - - (2,000,000) (2,172,000) (4,172,000) - - -
Subtotal General Fund $151,442,025 ($203,250) $151,238,775 ($1,503,848) ($280,950) ($1,784,798) ($151,963,438) ($1,966,067) ($153,929,505) Enterprise
Cemetery $243,000 - $243,000 $50,000 - $50,000 ($408,238) ($1,845) ($410,083) Golf 6,236,771 $114,279 6,351,050 (751,780) - (751,780) (4,997,788) (276,433) (5,274,221) Water 34,329,041 3,348,718 37,677,759 339,913 - 339,913 (34,138,883) (1,031,457) (35,170,340) Recycled Water 3,428,000 929,239 4,357,239 265,105 ($195,904) 69,202 (2,968,459) 936,533 (2,031,926) Sewer 17,222,500 862,310 18,084,810 135,000 - 135,000 (17,423,410) (711,496) (18,134,906)Storm Drain 730,000 - 730,000 625,000 - 625,000 (1,757,775) (90,635) (1,848,410) Transit 528,630 179,771 708,401 50,000 - 50,000 (561,330) (169,709) (731,039) Subtotal Enterprise Funds $62,717,942 $5,434,317 $68,152,259 $713,238 ($195,904) $517,335 ($62,255,883) ($1,345,042) ($63,600,925) Internal Service
Equipment Replacement $561,000 - $561,000 - - - ($275,000) ($175,000) ($450,000) Facilities Renovation 619,000 - 619,000 - $195,904 $195,904 (876,000) - (876,000) Fire Apparatus Replacement 440,000 - 440,000 - - - - (277,833) (277,833) Golf Replacement 6,000 - 6,000 $220,000 - 220,000 (345,000) (100,000) (445,000) Park & Median Renovation 1,118,000 ($730,000) 388,000 - - - (1,025,000) 730,000 (295,000) Police Vehicle Replacement 413,000 - 413,000 - - - (724,850) (148,500) (873,350) Self-Insurance Retention 4,122,050 830,950 4,953,000 - - - (4,648,050) (264,373) (4,912,423) Vehicle Replacement 599,000 - 599,000 - - - (971,000) 300,000 (671,000) Subtotal Internal Service $7,878,050 $100,950 $7,979,000 $220,000 $195,904 $415,904 ($8,864,900) $64,294 ($8,800,606) Special Revenue
Bernal Donations $50,800 $50,000 $100,800 - - - - ($50,000)($50,000) Bonde Landscape District 26,100 692 26,792 - - - ($24,470)(2,019) (26,489) Community Development Block Grant 422,387 - 422,387 - - - (176,591) (298,928) (475,518)HOME Program 201,466 (67,677) 133,789 - - - (132,868) (10,288) (143,156)Laurel Creek Geologic Hazard District 63,483 2,572 66,055 - - - (70,788) (23,000) (93,788) Lemoine 10,700 60 10,760 - - - (30,323) - (30,323)
Lower Income Housing 2,380,000 - 2,380,000 - - - (729,545) 117,554 (611,991) Moller Geologic Hazard District 16,418 (1,300) 15,118 - - - (56,422) - (56,422) Moller Ranch Landscape District 58,213 2,065 60,278 - - - (85,450) (38,553) (124,003) District 15,428Oak Tree Farm Geologic Hazard
2,165 17,593 - - - (38,024) - (38,024)
Oak Tree Farm Landscape District 19,862 790 20,652 - - - (36,880) 15,456 (21,424) Operating Grants 457,570 37,423 494,993 - - - (611,320) 116,327 (494,993)Reserve -Pleasanton Garbage Service Rate 800,000 800,000 - - - (657,244) (194,105) (851,349)
Ponderosa Landscape District 16,021 112 16,133 - - - (19,600) (42,558) (62,158) Recycling & Waste Management 240,000 - 240,000 - - - (449,420) 50,322 (399,098) Urban Forestry 50,600 25,000 75,600 ($25,000) - ($25,000)(29,500) (22,000) (51,500) Windsor Landscape District 23,860 406 24,266 - - - (23,860) 9,379 (14,481) Subtotal Special Revenue Funds $4,052,908 $852,308 $4,905,216 ($25,000) - ($25,000) ($3,172,304) ($372,414) ($3,544,718) Other Funds
PTCWD $8,925 - $8,925 - - - ($40,780) - ($40,780)
Total $226,099,850 $6,184,325 $232,284,175 ($595,610) ($280,950) ($876,559) ($226,297,305) ($3,619,229) ($229,916,534) FY 2024/25 Mid-Term Budget Adjustment Summary
Beginning Projected Projected Projected Projected Mid-Term Mid-Term Mid-Term Projected FY 2024 FY 2024 FY 2024 FY 2024 FY 2025 FY 2025 FY 2025 FY 2025 FY 2025 Balance Revenue Net Transfer Expenditure Beginning Bal. Revenue Net Transfer Expenditure Ending Balance Rainy Day Fund 6,620,550
General Fund (1) $50,664,595 $146,441,627 $465,052 ($147,799,541) $49,771,733 $151,238,775 $2,387,202 ($153,929,505) $49,468,205 - (2,000,000) - 4,620,550 - (4,172,000) - 448,550
Enterprise
Golf 1,680,033
Cemetery $460,909 $213,000 $50,000 ($374,416) $349,493 $243,000 $50,000 ($410,083) $232,410 5,997,010 (751,780) (4,908,379) 2,016,884 6,351,050 (751,780) (5,274,221) 2,341,933 Water 10,196,703 31,203,041 (5,533,507) (32,595,367) 3,270,870 37,677,759 339,913 (35,170,340) 6,118,202 Recycled Water (1,633,610) 3,298,523 465,105 (2,937,068) (807,050) 4,357,239 69,202 (2,031,926) 1,587,464 Sewer 7,605,048 16,529,500 1,134,000 (18,071,417) 7,197,131 18,084,810 135,000 (18,134,906) 7,282,035 Storm Drain (2) 326,499 730,000 925,000 (1,804,428) 177,071 730,000 625,000 (1,848,410) (316,339) Transit 663,128 539,450 50,000 (560,657) 691,921 708,401 50,000 (731,039) 719,283 Subtotal Enterprise Funds $19,298,710 $58,510,524 ($3,661,182) ($61,251,732) $12,896,320 $68,152,259 $517,335 ($63,600,925) $17,964,988 Internal Service - - - -
City Enhancement Fund $537,635 $1,500 - ($100,000) $439,135 $1,500 - ($100,000) $340,635Employee Benefits (3) 137,324 1,310,100 - (1,233,100) 214,324 1,310,100 - (1,233,100) 291,324 Equipment Replacement 3,121,166 561,000 - (613,000) 3,069,166 561,000 - (450,000) 3,180,166 Facilities Renovation 2,587,724 619,000 ($152,972) (1,331,000) 1,722,752 619,000 $195,904 (876,000) 1,661,656 Fire Apparatus Replacement 2,954,526 440,000 - (2,390,000) 1,004,526 440,000 - (277,833) 1,166,693 Golf Replacement 999,677 6,000 220,000 (759,000) 466,677 6,000 220,000 (445,000) 247,677 Information Technology Replacement 1,094,614 386,000 - (300,000) 1,180,614 386,000 - (300,000) 1,266,614 Park & Median Renovation 503,159 1,118,000 - (1,145,280) 475,879 388,000 - (295,000) 568,879 PARS Section 115 Fund 31,197,528 - - - 31,197,528 - - - 31,197,528 Retirees' Medical Reserve (3) 1,509,041 5,102,000 (905,000) (4,144,000) 1,562,041 5,344,000 (935,000) (4,349,000) 1,622,041 Police Vehicle Replacement 1,722,994 413,000 - (1,019,034) 1,116,960 413,000 - (873,350) 656,610 Public Art Acquisition 306,564 106,000 - (20,000) 392,564 106,000 - (25,000) 473,564 Self-Insurance Retention 1,616,345 3,584,000 - (4,110,000) 1,090,345 4,953,000 - (4,912,423) 1,130,922 Street Light Replacement 2,368,754 35,000 - (220,000) 2,183,754 35,000 - (220,000) 1,998,754 Traffic Signal Replacement 1,508,883 12,000 - (450,000) 1,070,883 219,750 - (450,000) 840,633 Vehicle Replacement 4,028,010 599,000 - (1,291,000) 3,336,010 599,000 - (671,000) 3,264,010 Workers Compensation (4) (3,876,264) 42,000 - - (3,834,264) 3,348,000 - (2,291,430) (2,777,694) Subtotal Internal Service $52,317,680 $14,334,600 ($837,972) ($19,125,414) $46,688,895 $18,729,350 ($519,096) ($17,769,136) $47,130,013 1) Projected FY 2024 Expenditure is reduced by $280,000, as the Mobile Outreach Vehicle is not expected to be delivered in FY 2024, so this funding will be reappropriated to FY 2025.3) Beginning fund balance excludes GASB 31 adjustments (unrealized investment gain/loss), pension and retiree heath liabilities2) The negative fund balance reflects a funding gap due to revenues remaining mostly static for the last several years. and long-term debt
4) The negative fund balance reflects the estimated future liability for outstanding workers' compensation claims. The negative fund balance will be eliminated over time with increased internal service charges.
Estimated Changes in Fund Balance
Beginning Projected Projected Projected Projected Mid-Term Mid-Term Mid-Term Projected Balance Revenue Net Transfer Expenditure Beginning Bal. Revenue Net Transfer Expenditure Ending Balance FY 2024 FY 2024 FY 2024 FY 2024 FY 2025 FY 2025 FY 2025 FY 2025 FY 2025 Special Revenue
Abandoned Vehicle $113,784 $32,600 - ($30,000) $116,384 $32,600 - ($30,000) $118,984Asset Forfeiture 18,683 100 - (3,000) 15,783 100 - - 15,883Asset Forfeiture - Federal 9,796 - - - 9,796 - - - 9,796Bernal Donations (4,674) 200,800 ($200,000)(45,000) (48,874) 100,800 - (50,000) 1,926Bonde Landscape District 22,780 26,100 - (24,470) 24,410 26,792 - (26,489) 24,712Business Support 1,656,556 350,000 (350,000) (60,000) 1,596,556 350,000 ($350,000) - 1,596,556Community Access T V 1,798,114 276,000 - (695,000) 1,379,114 276,000 - (120,000) 1,535,114Community Development Block Grant - 479,613 - (424,504) 55,110 422,387 - (475,518) 1,979DARE 18,112 200 - (9,400) 8,912 200 - - 9,112Opioid Distributors Settlement 76,600 - - - 76,600 - - - 76,600Downtown Economic Development Loan 28,285 500 - - 28,785 500 - - 29,285Downtown Parking In-Lieu 691,173 10,000 - - 701,173 10,000 - - 711,173HAPPY Public Art Donations 94,431 11,000 - (10,000) 95,431 11,000 - (10,000) 96,431HBPOA Maintenance District - 150,000 - (300,000) (150,000) 150,000 - (150,000) (150,000)HOME Program (123,118) 201,466 - (373,657) (295,309) 133,789 - (143,156) (304,676)Laurel Creek Geologic Hazard District 998,513 62,483 - (93,788) 967,208 66,055 - (93,788) 939,475Law Enforcement 1,084,233 199,000 - (1,326,711) (43,478) 199,000 - (50,000) 105,522Lemoine 91,137 10,500 - (30,323) 71,314 10,760 - (30,323) 51,751Lower Income Housing 13,381,702 2,380,000 - (1,182,947) 14,578,756 2,380,000 - (611,991) 16,346,765Opioid Mallinckrodt Bankruptcy 6,108 - - - 6,108 - - - 6,108Miscellaneous Donations 389,454 7,000 - (85,000) 311,454 7,000 - (85,000) 233,454Moller Geologic Hazard District 112,725 16,118 - (56,422) 72,421 15,118 - (56,422) 31,117Moller Ranch Landscape District 263,036 58,213 - (85,450) 235,799 60,278 - (124,003) 172,073North Pleasanton Improvements District 1,033,807 30,534 - (23,500) 1,040,841 30,534 - (23,500) 1,047,875Oak Tree Farm Geologic Hazard District 108,660 15,128 - (38,024) 85,764 17,593 - (38,024) 65,333Oak Tree Farm Landscape District 64,770 19,862 - (36,880) 47,752 20,652 - (21,424) 46,980Operating Grants 155,010 1,196,693 - (1,275,324) 76,379 494,993 - (494,993) 76,379Other Governmental 112,314 30,500 - (5,000) 137,814 30,500 - (5,000) 163,314Pleasanton Garbage Service Rate 3,290,381 - - (653,111) 2,637,270 800,000 - (851,349) 2,585,921Ponderosa Landscape District 86,501 16,021 - (19,580) 82,942 16,133 - (62,158) 36,917Recycling & Waste Management 399,384 240,000 - (445,431) 193,953 240,000 - (399,098) 34,855MitiRecycling & Waste Management Import gation 104,940 5,500 - (94,264) 16,176 5,500 - (800) 20,876 Urban Forestry 444,719 650,600 (25,000) (360,145) 710,174 75,600 (25,000) (51,500) 709,274Used Oil Grant - - - - - - - - -Windsor Landscape District (11,560) 23,860 - (23,860) (11,560) 24,266 - (14,481) (1,775) Other FundsSubtotal Special Revenue Funds $26,516,353 $6,700,391 ($575,000) ($7,810,790) $24,830,955 $6,008,150 ($375,000) ($4,019,018) $26,445,087 PTCWD $332,615 $8,925 - ($40,780) $300,760 $8,925 - ($40,780) $268,905 Total - All Funds $155,750,503 $225,996,067 ($6,609,102) ($236,028,256) $139,109,212 $244,137,459 ($2,161,559) ($239,359,364) $141,725,748 Estimated Changes in Fund Balance (Continued)
Summary of Revenues and Expenditures – Citywide
FY 2023 FY 2024 Adopted Recommended Mid-Term
Actual Modified Budget Budget Adjustments Budget
Revenues
General $151,149,404 $146,441,627 $151,442,025 ($203,250) $151,238,775 Internal Service 13,309,579 14,334,600 18,628,400 100,950 18,729,350 Enterprise 52,235,040 58,510,524 62,717,942 5,434,317 68,152,259 Special Revenue 4,825,008 6,700,391 5,155,842 852,308 6,008,150 Private-purpose Trust Funds 558 8,925 8,925 - 8,925
Total Revenues $221,519,589 $225,996,067 $237,953,134 $6,184,325 $244,137,459 Expenditures
General $133,540,446 $148,079,541 $151,963,438 $1,966,067 $153,929,505 Internal Service 9,760,762 19,125,414 17,833,430 (64,294) 17,769,136 Enterprise 53,782,922 61,251,732 62,255,883 1,345,042 63,600,925 Special Revenue 3,481,359 7,810,790 3,646,604 372,414 4,019,018 Private-purpose Trust Funds 16,729 40,780 40,780 - 40,780 Total Expenditures $200,582,218 $236,308,256 $235,740,135 $3,619,229 $239,359,364 FY 2025
General Fund Operating Budget Summary – Revenues
General Fund Operating Budget Summary – Expenditures
FY 2023 FY 2024 Adopted Recommended Mid-Term
Actual Modified Budget Budget Adjustments Budget
Property Tax $86,075,776 $90,116,000 $91,475,000 $1,467,000 $92,942,000 Sales & Use Tax 26,183,661 24,532,400 27,768,400 (2,638,400) 25,130,000 Other Taxes 12,208,540 11,110,000 11,578,000 512,000 12,090,000 Franchise Tax 3,284,092 3,105,000 3,165,000 20,000 3,185,000 License Tax 6,232 7,000 7,000 - 7,000
Permit Fees 3,594,898 3,206,000 3,206,000 (1,000) 3,205,000 Fines & Forfeitures 190,726 202,000 202,000 (18,000) 184,000 Interest & Rent (955,380) 490,000 490,000 100,000 590,000 Intergov Revenue 5,067,950 470,000 426,000 44,000 470,000 Planning(Devel) Fee 177,393 179,500 179,500 - 179,500
Plan Check Fees 3,199,296 1,542,500 2,142,500 - 2,142,500 Pw (Developer) Fees 247,542 326,500 36,500 - 36,500
Current Service Fee 1,423,387 1,618,200 1,644,200 4,900 1,649,100 Charges For Service 39,726 30,000 30,000 - 30,000
Donations 11,891 7,000 8,000 (1,000) 7,000
Miscellaneous 1,711,096 170,300 126,300 55,000 181,300
Sale Of Property 12,613 4,000 4,000 - 4,000
Misc Reimbursements 1,449,672 1,862,606 1,022,167 126,800 1,148,967 Library Revenue 9,896 13,000 13,000 12,000 25,000
Interfund Revenue 3,013,307 2,842,164 3,003,974 - 3,003,974 Recreation Revenue 4,197,090 4,607,457 4,914,484 113,450 5,027,934 Total Revenues $151,149,404 $146,441,627 $151,442,025 ($203,250) $151,238,775 Transfers-In $4,883,453 $3,743,780 $3,771,780 $2,172,000 $5,943,780 Total Revenues & Transfers $156,032,857 $150,185,407 $155,213,805 $1,968,750 $157,182,555 FY 2025
FY 2023 FY 2024 Adopted Recommended Mid-Term
Actual Modified Budget Budget Adjustments Budget
Personnel $94,110,681 $105,511,427 $108,471,827 $1,991,220 $110,463,047 Transportation & Training 1,750,740 1,865,165 1,838,953 (817,810) 1,021,143 Repairs & Maintenance 8,167,740 6,856,688 6,975,994 (154,000) 6,821,994 Materials & Supplies 27,199,195 33,095,261 34,234,114 766,277 35,000,391 Capital Outlay 1,829,159 746,000 437,550 180,380 617,930 Debt Services 482,932 5,000 5,000 - 5,000
Total Expenditures $133,540,446 $148,079,541 $151,963,438 $1,966,067 $153,929,505 Transfers-Out $13,859,076 $3,278,728 $3,275,628 $280,950 $3,556,578 Total Expenditures & Transfers $147,399,522 $151,358,269 $155,239,066 $2,247,017 $157,486,083 FY 2025
General Fund Transfer Summary
Adopted Recommended Mid-Term
Operating Transfers Budget Adjustments Budget
OPERATING TRANSFERS IN - From:
Urban Forestry Fund (1/2 of Landscape Arch Assist) $25,000 - $25,000 Retiree Medical Fund (Implied Subsidy) 865,000 - 865,000 Happy Valley Infrastructure Loan Repayment from Golf 531,780 - 531,780 Rainy Day Fund 2,000,000 2,172,000 4,172,000
Business Loan Repayment 350,000 - 350,000
OPERATING TRANSFERS OUT - To:
CIP & CIPR ($2,000,000) ($471,578) ($2,471,578)
Senior & Low Income Water & Sewer Discounts
Water Fund (250,000) - (250,000)
Sewer Fund (110,000) - (110,000)
Transit Fund (Subsidy) (50,000) - (50,000)
Storm Drain Fund (Subsidy) (625,000) - (625,000)
Cemetery Fund (Subsidy) (50,000) - (50,000)
LED CEC Loan Repayment (190,628) 190,628 -
NET OPERATING TRANSFERS $496,152 $1,891,050 $2,387,202
FY 2025
Fund Fund Description
Beginning
Balance Revenue
Adopted Revenue
Modifications
Adopted
Expenditure
Cost
Modifications
Revised
Project Cost
Year-End
Projected
Fund Balance
160 Gas Tax $971,458 $4,418,332 ($213,031) $4,435,000 - $4,435,000 $741,759 162 Miscellaneous CIP Grants (280,142) 20,000 6,000,000 - $6,000,000 6,000,000 (260,142)163 Measure B Bike & Pedestrian 177,582 - - - - - 177,582 164 Measure B - Streets/ACTC 62,281 1,903 - - - - 64,184 165 Measure BB Bike & Pedestrian 730,272 507,813 - 500,000 - 500,000 738,085 166 Measure F 57,717 391,128 - 450,000 (50,000) 400,000 48,845 167 Specific Plans 751,147 9,800 - - - - 760,947
170 Measure BB - Streets/Roads 439,116 1,829,420 - 1,975,000 - 1,975,000 293,536 172 Transportation Development Grant 150,728 80,000 - 80,000 - 80,000 150,728 173 JDEDZ Transportation Fee 460,021 - - - 460,021 460,021 - 201 Miscellaneous CIP-General Fund 19,687,756 2,124,400 471,578 2,775,000 15,001,578 17,776,578 4,507,156 202 Downtown & North Pleasanton CIP 317,068 40,800 - - - - 357,868 203 Capital Facilities Impact Fees 2,111,205 792,734 (614,332) - - - 2,289,607 204 Misc. Developer Contributions 597,297 5,100 - - - - 602,397 211 Street CIP - General Fund 3,481,466 102,000 - - - - 3,583,466 212 Traffic Impact Fees 210,233 1,060,955 (946,261) 1,100,000 (1,000,000) 100,000 224,927 214 Trivalley Transportation 938,623 574,714 (500,236) - - - 1,013,101 215 Streets Developer Contribution 280,755 20,782 - - - - 301,537216 North Pleasanton 1 ID (NPID) 13,173 - - - - - 13,173 221 Park CIP - General Fund 3,054,167 1,303,000 - 1,300,000 50,000 1,350,000 3,007,167 222 Park Development Impact Fees 1,175,216 101,856 - - - - 1,277,072 223 Parks Developer Contributions 336,482 3,742 - - - - 340,224 241 Sewer Developer Contributions 42,701 70 - - - - 42,771421 Water Replacement CIP 5,712,704 21,751 667,000 1,100,000 5,250,000 6,350,000 51,455 422 Water Connection Fees 4,470,935 278,881 - - - - 4,749,816 426 Recycled Water CIP 827,140 443,262 - 1,184,894 1,184,894 85,508 431 Sewer Replacement CIP 4,825,889 94,598 - 1,500,000 296,740 1,796,740 3,123,747 432 Sewer Connection Fees 3,296,026 143,735 - - - - 3,439,761 441 Storm Drain Replacement/Renovation 645,266 900,000 13,100,000 1,215,000 13,379,543 14,594,543 50,723 Total $55,544,282 $15,270,776 $17,964,718 $17,614,894 39,387,882 $57,002,776 $31,777,000 Note: Beginning balances are adjusted based on projected FY 2023/24 ending balances, which includes adjustments for funding Storm projects, recommended carryforwards from FY2023/24 into FY2024/25 will be reported early in FY 2024/25.
CIP Fund Balance Summary - All Funds
FY 2025
Project
Category Project Name Source
Funding
Budget
Modified
FY 2024
Budget
Adopted
FY 2025 FY 2025
Recommended
Adjustment Budget
Mid-Term
FY 2025
Facilities
OSC Fire Alarm And Notification System 201 $800,000 - $300,000 $300,000 Design Of Police Dept. Secured Police & Staff Vehicular Parking 201 - $200,000 - 200,000 Facilities Total $800,000 $200,000 $300,000 $500,000
Miscellaneous
ADA Transition Plan 201 $120,000 - $880,000 $880,000Valley Ave Soundwall Replacement 201 993,431 - 250,000 250,000 Annual Soundwall Repair & Replacement 201 125,000 125,000 - 125,000Asset Management Plan 201 350,000 250,000 - 250,000 Miscellaneous Total $1,588,431 $375,000 $1,130,000 $1,505,000 Parks
Annual Court Resurfacing 221 $100,000 $400,000 - $400,000 Annual Irrigation Upgrades 221 150,000 150,000 - 150,000 Annual Playground Renovations 221 179,302 550,000 - 550,000 Mercer SMotor Control Center Replacement and Temporary Power for Ken ports Park 221 156,072 - $50,000 50,000
Annual Park Trail & Pathway Resurfacing 221 - 200,000 - 200,000 Parks Total $585,374 $1,300,000 $50,000 $1,350,000Sewer Annual Sewer Collection System Improvement 431 $2,892,500 $1,500,000 - $1,500,000 Sewer Total $2,892,500 $1,500,000 - $1,500,000Storm Drain Sassafras Court Storm Drain Interceptor 441 $150,457 - $449,543 $449,543 Annual Storm Repair/ Replacement 441 435,578 $125,000 1,625,000 1,750,000Storm Water System Management Plan 441 - 500,000 - 500,000Sycamore Creek Storm Drain Improvements 441 200,000 550,000 4,250,000 4,800,000 Storm Drain Lift Station Improvements 441 - 40,000 - 40,000East Vineyard Detention Pond Outfall Repair 441 159,000 - 451,000 451,000Oak Tree Farm Outfall and Channel Stabilization 441 168,000 - 462,000 462,000Augustin Bernal Trail Creek Crossing Culverts and Retaining Wall 441 308,000 - 992,000 992,000Park Pathway Restoration(Alviso Adobe & Tawny Parks) 441 - - 150,000 150,000Sycamore Creek Storm Improvements (Sycamore Road) 441 - - 5,000,000 5,000,000 Storm Drain Total $1,421,035 $1,215,000 $13,379,543 $14,594,543 CIP Budget Summary By Projects
CIP Budget Summary By Projects (Continued)
Project
Category Project Name Source
Funding
Budget
Modified
FY 2024
Budget
Adopted
FY 2025 FY 2025
Recommended
Adjustment Budget
Mid-Term
FY 2025
Transportation & Streets
Annual Bicycle & Pedestrian Related Improvements at Various Locatio 172 $78,255 $80,000 - $80,000 Annual Curb & Gutter for Street Resurfacing 160 109,227 550,000 - 550,000Annual Expedited Speed Lump Program 160 50,000 50,000 - 50,000 Annual Intersection Improvements at various locations 160 100,000 100,000 - 100,000 Annual Neighborhood Traffic Calming Devices 160 250,690 50,000 - 50,000Annual Sidewalk & Intersection Ramp Installations (ADA) 160 167,026 200,000 - 200,000Annual Sidewalk Maintenance 160 205,125 150,000 - 150,000 Annual Slurry Sealing Of Various Streets 160 435,754 785,000 - 785,000 Annual Street Resurfacing & Reconstruction 160 986,606 1,575,000 - 1,575,000 Annual Street Resurfacing & Reconstruction 166 799,822 450,000 ($50,000) 400,000 Annual Street Resurfacing & Reconstruction 170 3,829,638 1,975,000 - 1,975,000 Annual Traffic Buttons & Line Marker Installation 160 106,600 50,000 - 50,000 Annual Bicycle & Pedestrian Related Improvements at Various Locatio 165 411,049 100,000 - 100,000 Bi-Annual Evaluation/Reclassification of Street Surfaces 160 15,000 25,000 - 25,000 Bi-Annual Traffic Signal Installations 212 750,427 750,000 (750,000) -JDEDZ Transportation Fee Reserve 173 552,497 - 460,021 460,021Sunol Boulevard Interchange Improvements 212 1,865,553 350,000 (250,000) 100,000 West Las Positas Boulevard Multimodal Reconstruction 160 1,400,000 900,000 - 900,000West Las Positas Boulevard Multimodal Reconstruction 162 2,167,000 - 6,000,000 6,000,000 West Las Positas Boulevard Multimodal Reconstruction 165 510,161 300,000 - 300,000 Annual Trail Resurfacing Project 165 100,000 100,000 - 100,000 Foothill Highschool Southbound Left Turn 201 - - 471,578 471,578 WaterTransportation & Streets Total $14,890,431 $8,540,000 $5,881,599 $14,421,599 Annual Recycled Water Repair & Replacement 426 $213,049 $50,000 - $50,000 Annual Water Distribution System 421 60,939 1,000,000 - 1,000,000 City Ground Water Supply 421 500,000 - $3,500,000 3,500,000 7XUQRXW3UHSDFNDJH%RRVWHU6WDWLRQ3URFXUHPHQW 421 - - 1,300,000 1,300,000 Water Total $773,988 $1,050,000 $4,800,000 $5,850,000Grand Total $22,951,759 $14,180,000 $25,541,142 $39,721,142
Item #18
CITY COUNCIL AGENDA REPORT
May 21, 2024
Finance
TITLE: RECEIVE A REPORT AND PRESENTATION ON THE USE OF SECTION 115
PENSION TRUST FUNDS AND PROVIDE FEEDBACK TO STAFF
SUMMARY
At its February 20, 2024, meeting, the City Council directed staff to engage an actuary consultant to analyze the use of the City’s Section 115 Pension Trust funds to help reduce the projected General Fund budget deficit in future years. Subsequenlty, the City entered into an agreement with Foster & Foster to conduct the analysis. At the May 21, 2024, City Council meeting the actuary consultant will present scenarios for the City Council's consideration when contemplating the use of pension trust funds.
RECOMMENDATION
Receive a report and presentation on the use of pension trust funds and provide feedback to staff.
BACKGROUND
Like many agencies, the City has been proactive in implementing strategies to pay down its pension liabilities. To this end, in 2018, the City established a Section 115 Pension Trust.
Pension Trusts enable cities to set aside funds and earn greater investment returns than the City’s General Fund. Those assets can then be used to stabilize pension costs in future years, when needed.
In June 2108, the City established a Section 115 Pension Trust fund (Trust Fund) with PARS with an initial contribution of $28.0 million, with subsequent contributions of $10.0 million in FY 2019/20 for a total of $38.0 million. Of the $38.0 million, $16.7 million was deposited into the PARS Conservative Portfolio and the $21.3 million balance into the PARS Capital Growth Portfolio. The City’s objective is to ensure there will be sufficient funds in the PARS Trust to meet the City’s expected increased pension contributions associated with the City’s unfunded pension liabilities, and to fully fund the liabilities over time. The PARS Conservative Portfolio is included in the General Fund Restricted Reserves; the PARS Capital Growth Portfolio is reflected in the PARS Section 115 Pension Trust Fund.
At the end of FY 2022/23, the total market value of the City’s Trust Fund was $46.3 million.
Due to improvements in the market, the total market value was $50.5 million at the end of March 2024, with $19.3 million in the PARS Conservative Portfolio and $31.2 million in the PARS Capital Growth Portfolio.
The City's current unfunded pension liabilities total $188.0 million (net of pension trust funds).
The City Council adopted the following Section 115 Pension Trust Withdrawal Policy Guidelines to help ensure there are monies available to help the City make pension
contributions when necessary:
a. Annual CalPERS employer pension contribution rate increase (in dollars) is greater than the growth rate (in dollars) of the City’s General Fund. [Example: the pension contribution increases by $2.0 million from the previous year while General Fund growth is $1.5 million.]
b. The General Fund has a structural deficit that needs to be addressed (i.e., nondiscretionary expenditures exceed revenues). c. General Fund reserves have been used and need to be replenished in order to maintain a reserve equal to 20.0 percent of General Fund expenditures. d. Paying off specific pension liabilities that will result in interest savings greater than interest earnings on the Trust Fund.
The policy also provides guidelines on withdrawing funds from the Conservative Investment Portfolio first and allowing City staff to deposit/withdraw funds from the Conservative Portfolio for an amount up to the annual contribution required by CalPERS. A copy of the policy is provided as Attachment 1.
DISCUSSION
The actuary consultant developed four scenarios for analysis, as presented below. In projecting the use of funds, the actuary also included estimates for investment earnings that are expected to be generated over time. Therefore, the funds that will be available in future years are expected to be higher than the current portfolio balance.
In terms of peak years that require higher contributions, this can vary depending on the scenarios. But it is fair to conclude that many of the peak period contribution rates are within the next ten years. As more employees enroll in the less generous PEPRA Plan, pension contributions are expected to decrease over time.
It should be noted that when investment returns are lower than the expected returns (generally around 6.8% annually), actual CalPERS contributions are expected to go up. The funding gap/use of pension trust funds is expected to be higher assuming the City’s target contribution does not change.
Scenario 1 is the most likely scenario assuming CalPERS investment returns meet expectations using the 50% percentile for peak calculation and actual CalPERS contribution.
The City’s target contribution rate is assumed at 38.1% for the Miscellaneous Plan and about
52.0% for the Safety Plans, as shown below. The gap between the target contribution and the required contribution will be funded by pension trust funds. Based on this scenario, the first withdrawal is projected for FY 2025/26. The annual withdrawal amounts are projected to range from $2.3 million to $7.9 million. Funds are projected to deplete in FY 2038/39.
Scenario 2 uses a peak calculation assuming CalPERS investment returns meet expectations, but actual investment returns are below expectations at 25% percentile for actual CalPERS contributions. The City’s target contribution rate is assumed at 38.1% for the Miscellaneous Plan and about 52.0% for the Safety Plans, as shown below. With this scenario, the first withdrawal is projected for FY 2025/26. The annual withdrawal amounts are projected to range from $2.5 million to $15.0 million. Funds are projected to deplete in FY 2032/33. Due to lower than expected investment returns, trust funds are expected to deplete sooner than Scenario 1.
Scenario 3 uses a peak calculation assuming CalPERS investment returns are below expectations using the 25% percentile and actual CalPERS contribution. The City’s target contribution rate is assumed at 46.7% for the Miscellaneous Plan and 68.9% and 64.7% for the Safety Plans, as shown below. With this scenario, the first withdrawal is projected for FY 2027/28. The annual withdrawal amounts are projected to range from $0.5 million to $9.0 million. Funds are projected to deplete in FY 2041/42. With higher City target contributions, trust funds for Scenario 3 are expected to last longer than the first two scenarios.
Scenario 4 assumes a percentage of covered payroll is used to calculate the transfer from the pension trust. The City’s percentage is assumed at 6.0% of covered payroll for the Miscellaneous Plan and 7.0% and 8.0% for the Safety Plans, as shown below. With this scenario, the first withdrawal is projected for FY 2025/26. The annual withdrawal amounts are projected to range from $3.8 million to $5.8 million. Funds are projected to deplete in FY 2041/42.
A summary of the projected annual withdrawals for all four scenarios is presented in Table 1 below. Please note that the term "deplete" was used for the last year of trust withdrawals above. It is likely that a small balance of assets will remain in the trust resulting from investment earnings.
Table 1: Summary of Projected Annual Withdrawals for Scenarios 1-4 These scenarios are for consideration only. When determining the annual withdrawal amounts, the City should take into consideration factors such as the funded status/unfunded liabilities for all the pension plans and the City’s long-term financial health. While it is appropriate to use one-time funds to help balance the budget as a long-term solution is being developed, ongoing use of one-time money is not recommended.
It should be noted that the use of pension trust funds will lower the overall funded status for the City’s pension plans. The City’s current funded status is in line with the state average when accounting for pension trust funds; without the pension trust funds, the City’s funding ratio is below the state average. According to the City’s investment manager and actuarial consultant, they are not aware of any agencies that are withdrawing funds from their pension trust accounts since many agencies are still trying to build up the funds.
Using savings to balance a structural budget deficit is not a prudent fiscal strategy. Staff recommends using an annual amount of $3.0 to $4.0 million in the first few years to bridge the projected budget gap if needed while the City continues to identify new revenue sources and implement further cost reductions. As stated above, the funded status for the City's pension plans will be lower as trust funds are spent, and the City's net pension liability will increase. A higher pension liability may also mean higher borrowing costs for capital projects if the City wants to issue debt to fund priority community projects in the future. Pension obligation is one of the criteria that rating agencies use for bond ratings.
The ultimate solution is to bring in new revenue sources such as a sales tax increase and reduce costs/services to balance the overall budget, as discussed in the contingency menu of potential service reductions that will be presented to the City Council at a workshop on May 21, 2024.
EQUITY AND SUSTAINABILITY
This item is an informational report to solicit feedback from the City Council regarding the use of pension trust funds to help balance the City's budget in future years.
OUTREACH
This item was publicized as part of the noticing for the City Council meeting agenda.
STRATEGIC PLAN ALIGNMENT
This item aligns with the ONE Pleasanton strategic plan goal of Funding Our Future that supports financial health and sound fiscal policies through long-term planning, cost recovery, increased revenue, and cost containment.
FISCAL IMPACT
This item is informational; feedback received at this meeting will be incorporated into future budget development.
Prepared by: Submitted by: Approved by:
Susan Hsieh, Director of
Finance
Susan Hsieh, Director of Finance Gerry Beaudin, City
Manager
Attachments:
1. PARS Withdrawal Policy
AMENDED BY CITY COUNCIL 02/18/20
45'#4"*
+5:, ::
5#,+:
:
+4#,+:0645:6+
:#5"
08&:,&#
9:
+460
4:5"
0 :
8#'':
:*,+#
4:7#'&
:5,:"
'.:5"
:#59:*%
:.
+4#,+:
,+50#65#,+4:8"
+:+
4409:
"
:.60.,4
:, :5"#4:.,&#
9:#4:5,
:
(
:(#*#54:,+:5"
:64
:, :5"
:#594:
5#,+:
:
+4#,+:0645: 6+
*#+#45
0 :9:
:
:0645:5,:
+460
: 6+
4:0
:7#&'
:5,:*%
.
+4#,+:
,+50#65#,+4:
60#+!: #++
#&'9:
# #
6&5:5#*
4
6 :.0
4460
:5,:0
6 :#59:4
07#
4:5,:*%
:.
+4#,+:
,+50#65#,+4:
60#+!
#++
#&&9:
# #
6&5:5#*
4
5:#4:5"
:.,&#
9:, :5"
:#59:, :&
4+5,+:5,:.06
+5&9:*+!
:#54:6
!
5:
"#4:.,&#
9:..&#
4:5,:5"
:#594:
5#,+:
:
+4#,+:0645:6+
:
*#+#45
0 :9:
:
:0645:
#++
:
.3*
+5:45 :*9:++6'&9:
.,4#5:+
:8#5"
08: 0,*:5"
,+4
075#7
:+7
45*
+5:,25 ,'#,:6.:5,:5"
:5,5&:0
/6#0
:&:.9*
+5
"
:#59:+!
0:*9:8#5"
08: 0,*:5"
:
:0645:8#5":#59:,6+
#&
..0,7&
#450#65#,+:..0,7
:
&4-+:$)",:#59:+!
1: