1 City of Richmond
Fiscal Year 2022-2023
Proposed Operating Budget
Shasa Curl, City Manager
Delmy Cuellar, Director of Finance
June 21, 2022
Overview
Proposed FY 2022-23 General Fund Balanced Budget
General Fund Revenue Assumptions & Estimates
General Fund Expenditure Assumptions & Estimates
Proposed Operating Transfers Out
Adjustments Made to Balance the Budget
General Fund Reserve Level
Non-General Fund
Capital Improvement Budget
Fiscal Headwinds
Next Steps & Questions
2 Proposed FY 2022-23
General Fund Balanced Budget
3 GENERAL FUND May 3, 2022 June 7, 2022 June 21, 2022 TOTAL REVENUE 206,360,370 206,483,393 206,632,248
TOTAL EXPENSE 206,332,516 201,969,824 206,632,248
Net (-Gap)/+Surplus 27,854 4,513,569 0.00
General Fund Revenue Assumptions to Date
Revenue Category Assumptions
PROPERTY TAXES Assessed Value (AV) Growth based on (1) most properties increasing by State posted CPI (usually 2% max), (2) plus, for the properties that sold in 2021, the new value minus the previous value, and (3) the value of the Chevron Refinery. Staff usually assumes the Chevron refinery will stay the same - 0% AV growth for that component.
SALES & USE TAX 4% growth per the consultant; Vehicle License Fee Backfill Swap tied to AV growth, same as Secured Property Taxes.
UTILITY USERS TAX (UUT) Analysis in part provided by consultant. Growth rates applied to individual revenue streams with the UUT category - cable and Telecom historically have been going down due to industry changes. Settlement amount is set and due to go away after FY24-25. Cap amount paid by Chevron is based on Energy Services CPI for the Bay Area which through the posted rates through February is extremely high.
OTHER TAXES Each revenue stream within Other Taxes changes year-to-year based on independent influences; both garbage fees are up by 4% based on historical changes; Hotel Tax up 5% based on rebounding industry; Transfer Tax budgeted amount based on formula in Guiding Fiscal Policy that mandates we use the mean since implementation of the voter approved tiered structure; gas and electricity franchise changes stem from using same growth factor as UUT.
LICENSES, PERMITS & FEES Main item is Business Tax and are using growth factor of 2% as a conservative CPI. Still new revenue stream so we still do not know what the full year amount will be.
FINES & FORFEITURES Parking citations flat and Muni Court Fines with 1.4% growth USE OF MONEY & PROPERTY Flat - zero growth
CHARGES FOR SERVICES Most items entered by corresponding departments based on their estimated level of service and total corresponds to 4.3% growth OTHER REVENUE Very unpredictable. Usually very little budgeted here, but items get added as received.
RENTAL INCOME Rental Income is determined based on the Council approved agreements and/or fees established through the Master Fee Schedule INTERGOV STATE TAXES Motor Vehicle Fees increase based on YTD actuals in FY21-22 INTERGOV OTHER GRANT Only grants with award letters are budgeted PROCEED FROM SALE PROPERTY Pending budget, based on historic trend OPERATING TRANSFERS IN Based on Analysis of the Pension Tax Override fund, estimated AV growth, minus scheduled uses. Left over funds are transferred to the General Fund 4 General Fund Revenue Estimates
5*Current Year (CY)
REVENUES FY 2022-2023
REVISED BUDGET
FY 2022-2023
PROPOSED BUDGET CHANGE
PROPERTY TAXES 45,233,561 46,056,962 1.80%
SALES & USE TAX 51,993,736 55,282,200 6.30%
UTILITY USERS TAX 46,522,663 49,963,589 7.40%
OTHER TAXES 20,953,343 21,638,449 3.30%
LICENSES, PRMITS&FEES 10,354,335 11,129,402 7.50%
FINES & FORFEITURES 468,897 475,275 1.40%
USE OF MONEY&PROPRTY 236,079 236,079 0.00%
CHARGES FOR SERVICES 3,424,459 3,571,292 4.30%
OTHER REVENUE 1,473,927 187,500 -87.30%
RENTAL INCOME 747,268 874,506 17.00%
INTERGOV STATE TAXES 90,000 125,000 38.90%
INTERGOV STATE GRANT 187,878 175,000 -6.90%
INTERGOV OTHER GRANT 153,569 253,569 65.10%
PROC FR SLE PROP 100,000 100,000 0.00%
LOAN/BOND PROCEEDS 36,400 - -100.00%
OPER XFERS IN 10,204,224 16,563,424 62.30%
TOTAL REVENUE 192,180,338 206,632,248 7.50%
General Fund Expenditure Assumptions to Date
Expenditures Category Assumptions/Descriptions
SALARIES AND WAGES IAFF, RFMA, RPMA, RPOA negotiations pending, Executive, Local 21 and Local 1021 5 percent COLA as of 1/1/2023, other pays based on existing MOUs and current enrollments.
PAYRLL/FRINGE BENEFIT Healthcare cost at current rates as of FY2022, OPEB per current Actuarial report, Retirement rates per current CalPERS rates. Worker's Comp rate 1 % increase in each category PROFESSIONAL & ADMIN Baseline budget, with one-time appropriations removed, City Attorney Legal Services Contract $1.5 million OTHER OPERATING Baseline budget with one-time appropriations removed.
UTILITIES Baseline budget
EQPT & CONTRACT SVCS Baseline Budget based on historical actuals PROVISN FOR INS LOSS Insurance Premiums
COST POOL (Vehicle Replacement) Fleet Services provided list with Priority 1 items COST POOL (General Liability) 5% increase from current year budget COST POOL (Cost Allocation Plan - Admin Charges) 5% increase from current year budget COST POOL (Civic Center Debt Allocation) Charge derived from the debt service, cash balance, and square footage used by divisions ASSET/CAPITAL OUTLAY As needed
DEBT SVC EXPENDITURE Debt Service Schedule, maintained by Treasury A87 COST PLAN REIMBS Based on COST POOL (Cost Allocation Plan - Admin Charges) GRANT EXPENDITURES Based on the awarded grants
OPER XFERS OUT Recurring and onetime subsidies to non-GF programs. 6*International Association of Fire Firefighters (IAFF), Richmond Fire Management Association (RFMA), Richmond Police Management Association (RPMA), Richmond Police Officers Association (RPOA) General Fund Expenditure Estimates
7 EXPENDITURES FY 2021-2022
REVISED BUDGET
FY 2022-2023
PROPOSED BUDGET CHANGE
SALARIES AND WAGES 75,822,428 78,761,868 3.9%
PYRLL/FRINGE BENEFIT 62,143,352 66,929,804 7.7%
PROF & ADMIN 16,248,412 16,977,138 4.5%
OTHER OPERATING 7,225,103 8,720,902 20.7%
UTILITIES 5,010,518 5,399,957 7.8%
EQPT & CONTRACT SVCS 2,555,148 2,731,448 6.9%
PROVISN FOR INS LOSS 27,673 25,725 -7.0%
COST POOL 14,455,436 15,277,766 5.7%
ASSET/CAPITAL OUTLAY 1,416,551 2,422,136 71.0%
DEBT SVC EXPENDITURE 1,065,359 1,037,009 -2.7%
A87 COST PLAN REIMBS -3,516,104 -3,531,610 0.4%
GRANT EXPENDITURES 82,500 2,500 -97.0%
OPERATING TRANSFERS OUT 12,801,419 11,877,605 -7.2%
TOTAL EXPENSE 195,337,796 206,632,248 5.8%
Proposed FY 22-23 General Fund Operating Transfers Out
8 Operating Transfers Out FY 2022-2023 Proposed Budget
Debt Service 1,744,390
Hilltop Lighting and Landscaping District 229,115
Marina Bay Lighting and Landscaping District 462,436
Employment and Training 743,201
Information Technology Equipment Replacement 100,000
Department of Children and Youth 3,936,896
Richmond Housing Authority 1,261,082
Pension Fund 100,485
Reimagining Public Safety - Unhoused Intervention 1,320,000 Reimagining Public Safety - Youthworks 1,980,000
Total 11,877,605
Adjustments Made to the Balanced Budget
9 Proposed Budget Savings/Revenue Adjustments Proposed Appropriations Current Estimated Surplus 4,513,570 COLA/Class & Comp 7,385,608 Vacancy Saving Factor - 6% 8,339,184 Inflation Factor - 5%* 1,410,215 Increase Transfer In from PTOR 148,800 City Attorney Legal Services 1,500,000 Other Savings 824,269 Point Molate Expenses 1,000,000
Additional Paving Index Investment 1,000,000
Housing First 425,000
Public Bank 750,000
Reparations, Equity, and Inclusion – Year One 250,000
Literacy Fair 5,000
Short-term Emergency Housing Interventions 100,000
New City-Wide Appropriations Request Not Included
City-Wide Positions Request Not Included
Total Available 13,825,823 Total Appropriations 13,825,823 *https://www.bls.gov/regions/west/news-release/consumerpriceindex_sanfrancisco.htm Proposed FY 2022-2023 Non-General Fund Budget
Fund Type Proposed FY 2022-2023
Other Operations 27,075,053
Special Revenue 39,674,849
Capital Improvement 37,256,854
Debt Service 21,612,086
Enterprise 70,579,794
Internal Service 25,169,925
Housing 5,458,047
Richmond Housing Authority 4,880,044
Total 231,706,650
10 Proposed FY 2022-2023
Capital Improvement Proposed Budget
Fund Number Fund Name Proposed FY 2022-2023
1002 Gas Tax 2,815,755
1019 RMRA-SB1 2,395,337
1054 Engineering Grants 14,509,778
2001 General Capital 3,061,487
2002 Measure J 3,786,947
1004 Asset Seizure 20,000
1006 Outside Grants 8,662,839
2113 Fire Impact Fee 89,383
2110 Park Impact Fee 15,000
2111 Traffic Impact Fee 263,639
2116 Open Space Impact Fee 373,264
2117 Library Impact Fee 469,295
2120 Wastewater Impact Fee 794,130
Total Capital Project Funds $37,256,854
11 Fiscal Headwinds
Classification & Compensation Study and Vacancy Saving
COLA/Class &
Comp Study $7.4
million
Estimated Vacancy
Saving $8.3 million
(Approx. 6%)
12 *CalPERS
$367 million
**OPEB
$102 million
13 Fiscal Headwinds
Unfunded Liabilities
*Per CalPERS Annual Valuation Report for FY 2022-2023
**Per Van Iwaarden (consultant) Estimated Actuarially Determined Contribution for FY 2022-2023 Analysis Paving Condition Index points 60
Paving Condition Index Points 51
Year 1
PCI - 60 Year 2
Year 3
Year 4
Year 5
PCI - 51
14 Fiscal Headwinds
Deteriorating Infrastructure – Paving Condition Index
15 Fiscal Headwinds
Underfunding of Risk Reserve
$3,047,073
$4,668,140
FY 2022-23 Budget
FY 2022-23 Budget
Next Steps
16 FY 2021-2022
September 2022, Year-End Clean Up
FY 2022–2023
FY 2022-2023 First Quarter Update ,
October 2022
THANK YOU
&
QUESTIONS?
17 “Juneteenth Freedom Underpass”
South 37th Street Underpass
Desi Mundo (2022)