City of Sacramento
Budget and Audit Committee Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2022-01746 12/6/2022 Discussion Item 5.
Measure U Community Advisory Committee Fiscal Year (FY) 2020/21 Annual Report [Continued from 11/01/2022]
File ID: 2022-01746
Location: Citywide
Recommendation: Pass a Motion: 1) accepting the Measure U Community Advisory Committee FY2020/21 Annual Report; and 2) forwarding the report to City Council for final receipt.
Contact: Ash Roughani, Special Projects Manager, (916) 808-7751, Office of the City Manager Presenter: Members of the Measure U Community Advisory Committee Attachments:
1-Description/Analysis
2-Measure U Community Advisory Committee FY2020/21 Annual Report 3-FY2020/21 Measure U Accounting Memorandum and Sales Tax Performance Audit Description/Analysis
Issue Detail: On November 6, 2018, City of Sacramento voters approved a one-cent Transaction and Use Tax (Measure U). As required by Measure U, the Council adopted Resolution 2018-0393, which established a fifteen-member Community Advisory Committee (Committee) to review revenues and expenditures and make recommendations to Council.
The Measure U ballot language requires annual independent financial audits and citizen oversight.
As part of complying with the ballot language, the Measure U revenues and expenditures are accounted for in a separate fund and a performance audit is completed annually by the City’s external auditors to ensure that Measure U funds are spent in accordance with the ballot measure.
In addition, the Committee’s Operating Procedures adopted by Council on December 11, 2018 require that the Committee submit an annual report to Council. The Committee’s annual report on Measure U expenditures for FY2020/21 is attached for Council review.
File ID: 2022-01746 12/6/2022 Discussion Item 5.
Policy Considerations: Council Resolution 2018-0393 adopted October 2, 2018 outlines the purpose, and the powers and duties of the Measure U Committee. Specifically, the Resolution states, to ensure that the expenditures of City resources reflect Council and community priorities, the Committee shall review, report, and make non-binding recommendations on revenue and expenditures of certain funds from the Transactions and Use Tax (Sacramento City Code chapter
3.27.).
Economic Impacts: None.
Environmental Considerations: None.
Sustainability: None.
Commission/Committee Action: At its September 19, 2022 meeting the Committee approved its FY2020/21 Annual Report.
Rationale for Recommendation: The Committee is required to submit an annual report to Council.
This recommendation is consistent with that requirement and Resolution 2018-0393.
Financial Considerations: Not applicable.
Local Business Enterprise (LBE): No goods or services are being purchased under this report.Page 2 of 2 September 19, 2022
M
ayor and Councilmembers
City of Sacramento
New City Hall
915 I Street
Sacramento, CA 95814
R
E: Review of Measure U Revenue and Expenditures for FY 2020-2021 D
ear Mayor Steinberg and Councilmembers:
A
s called for by City Council action establishing the Measure U Community Advisory Committee, the Committee has reviewed the Measure U revenue and expenditures for Fiscal Year 2020-2021. Our report follows.
Background:
In November 2012, City voters approved a temporary ½ cent sales tax intended to restore police, fire, park maintenance and library services which had been adversely affected by the recession.
This additional sales tax took effect on April 1, 2013 and expired March 31, 2019. Throughout the five years of the original Measure U’s existence, care was taken not to create long-term liabilities which would need to be funded after the expiration of the Measure.
In November 2018, City voters approved a permanent one-cent sales tax. The ballot measure read “Shall the measure to protect and enhance essential public safety services, including 9-1-1 response, fire protections, community neighborhood policing and other essential services, including homeless supportive services affordable housing, libraries, park maintenance, high-wage job promotion and youth programming, by enacting a one-cent sales tax generating $95 million annual that is legally required to stay in the City’s General Fund until ended by voters, with independent annual financial audits and citizen oversight be adopted?”
Observations and Findings:
1. An independent auditor was engaged by the City to review the revenues and expenditures of Measure U dollars. The auditor, Macias, Gini & O’Connell, LLP, concluded that Measure U funds were collected, allocated and expended in conformance with the ballot measure. Th e
C
ommittee agrees that the City’s expenditure of Measure U funds is in legal compliance with the provisions of Measure U.
2. During 2020-2021, city staff developed the Program Oriented Development (POD) Review, a new budget document that provides an inventory of the City’s programs and services. This new document has the potential to be a useful tool for increasing transparency about the expenditure of Measure U funds and on the targeted services and programs envisioned when the Measure was adopted.
3. Consistent with its responsibility for providing recommendations on the use of Measure U funds, the Measure U Community Advisory Committee submitted recommendations during the 2020-2021 budget development process that we believed were more in line with the letter and spirit of Measure U and more suited to the economic and human realities that emerged over the course of the pandemic than what was proposed by City staff.
In summary, we did not believe that allocation of Measure U funds for 2020-2021 met the significant needs identified in the ballot measure, particularly with respect to homeless supportive services, affordable housing, libraries, park maintenance, high-wage promotion and youth programming.
Moreover the 2020-2021 budget did not address community support for redefining public safety with investments identical to those called for in Measure U.
Comparison of Measure U Community Advisory Committee 2020-2021 Budget Recommendations to Final 2021 Adopted Budget:
The Committee believes that it is in the public’s interest to know how the Committee’s budget recommendations compare to the actual budget adopted by the City Council. As noted above, we believe that the POD Review will provide a useful tool for providing a comprehensive and transparent way for understanding the relationship between the Committee’s recommendations and Council actions. However, the POD Review was not sufficiently developed to enable a full comparison recommendations and actual expenditures in the 2020-2021 Final Budget.
As a result, the only comparative data we are able to provide is as follows:
The Measure U Community Advisory Community Committee recommended that:
1. No Measure U funds be provided for Police Services. The Final Budget allocated $43.5 million in Measure U funds
2. $13.1 million in Measure U funds be provided for Fire Services. The Final Budget allocated $21.6 Measure U funds
3. $14.9 million In Measure U funds be provided for Youth Programs. The Final Budget allocated $14.7 million in Measure U funds
4. A total of $60.3 million in Measure funds be provided for Economic Development, Homeless Services, Affordable Housing, CIPS/MIPS, and other miscellaneous programs.
At the time of this report, whether, and if so, what recommendations from the Committee were funded is not available.
5. $5 million in Measure U funds be allocated for the Participatory Budgeting pilot project.
The Final budget for 2020-2021 did not include funding for this project, though the 2021-22 budget included $1 million for this project
We appreciate the continuing dialogue among the Committee, City staff and the Mayor and City Council to assure public transparency and accountability for the expenditure of Measure U Funds.
Submitted in the spirit of shared commitment to community and transparency.
The Measure U Community Advisory Committee
Cc: City Manager Howard Chan
Assistant City Manager Michael Jasso
City Clerk Mindy Cuppy
Enclosures:
1. Measure U Mid-year Budget Revisions 2020 - 2021 (December 9, 2020)
2. Urgent Request: Participatory Budgeting and Measure U (July 27, 2020)
3. Measure U FY 20/21 Budget Response Letter (July 31, 2020)
Measure U Mid-year Budget Revisions 2020 - 2021
December 9, 2020
Mayor and Councilmembers
City of Sacramento
New City Hall
915 I Street
Sacramento, CA 95815
Dear Mayor Steinberg and Councilmembers:
As authorized by City Council action establishing the Measure U Community Advisory
Committee, we provide the following recommendations regarding the 2020-2021 mid year
budget update.
First, in July 2020, we submitted a comprehensive set of recommendations (see enclosure) for
alternative uses of measure funds which we believed was more in line with the letter and spirit
of Measure U and more suited to the new economic and human realities that emerged over the
last eight months. Key points included:
●
We do not believe that the current allocation of Measure U funds meets the areas of
significant need identified in the ballot measure, particularly homeless supportive
services, affordable housing, libraries, park maintenance, high-wage job promotion and
youth programming
●
Moreover the current budget proposal is also strikingly out of step with fervent calls from
Sacramento residents in the wake of recent widespread protests of systemic racism to
redefine public safety with investments identical to those proposed in the Measure U
campaign
We stand by these observations and refer you to our July letter for specific recommendations.
We are heartened, however, by Mayor Steinberg’s statements in support of participatory
budgeting and by the interest and attention of Councilmembers in this concept. Consistent with
our recommendation to you on July 27, 2020 (see enclosure) we urge you to include funding of
at least $15 million annually in Measure funds for participatory budgeting, beginning with the
mid-year revision for 2020-2021.
In partnership for a thriving Sacramento,
The Measure U Community Advisory Committee
Cc:
City Manager Howard Chan
Assistant City Manager Michael Jasso
Assistant City Manager Layne Milstein
Assistant City Clerk Wendy Klock-Johnson
Enclosures:
Pages 2 - 4: Urgent Request: Participatory Budgeting and Measure U (7/27/20)
Pages 5 - 11: Measure U FY 2020/21 Budget Response Letter - (6/22/20 and 7/31/20-Rev)
Urgent Request: Participatory Budgeting and Measure U
July 27, 2020
Mayor and Councilmembers
City of Sacramento
New City Hall
915 I Street
Sacramento, CA 95815
Dear Mayor Steinberg and Councilmembers:
In November of 2018, Sacramento residents were asked to consider this question on the ballot:
Shall the measure to protect and enhance essential public safety services, including
9-1-1 response, fire protection, community neighborhood policing, and other essential
services, including homeless supportive services, affordable housing, libraries, park
maintenance, high-wage job promotion, and youth programming, by enacting a one-cent
sales tax generating $95 million annually that is legally required to stay in the City's
General Fund, until ended by voters, with independent annual financial audits and citizen
oversight, be adopted?
Of the 153,541 people who voted, 57% said, yes, let’s keep Measure U, which voters had
originally passed in 2012, expand it by another ½ cent and then codify it in perpetuity until
voters choose to cease supporting it.
We recognize that the November 2018 ballot initiative built upon the original focus – supporting
public safety – police/fire—and Youth, Parks & Community Enrichment, but also added the
promise of support to address the needs of historically underserved and ‘disadvantaged
communities’ in areas such as homeless services, affordable housing, libraries, youth
programming, park maintenance, high-wage job promotion and inclusive economic development
strategies through meaningful investments in underserved neighborhoods.
Our understanding was that those most adversely affected by racial and economic
disparities would move to the front of the line of funding allocations. In February, our
entire Measure U committee voted to support a proposal to use a small portion of
Measure U funds for Participatory Budgeting (PB)
, and sent a letter to the City Council
requesting that $5 million of Measure U funds be set aside to ensure that an inclusive process
be implemented using the approach and that recommendations would be binding. At the time,
we asked for $5 million as the committee was not receiving regular reports about the revenue
and budget amounts available and there were various figures being suggested of between $5-8
million.
We are not aware that our original letter was ever reviewed or considered.
Why Participatory Budgeting (PB)?
Participatory Budgeting is a democratic process that gives ordinary people direct control over a
portion of a public budget resulting in binding recommendations for funding. It empowers
residents to engage in processes that lead to finding solutions and knits communities together.
Leaders in more than 3,000 cities and municipalities have implemented participatory budgeting
as a way to listen to citizens, build trust between citizens and city leadership and, perhaps most
importantly, build budgets that reflect and align with the values of community residents,
particularly those whose voices are not typically included nor heard.
As cities and communities across the country demand that budgets be radically restructured,
now is a perfect time for the City of Sacramento to adopt and embed Participatory Budgeting in
the same way the city has embedded Measure U as an ongoing funding stream. California
cities, including Long Beach, Oakland, Merced, Vallejo, Fresno, San Francisco, San Jose and
San Francisco County, have implemented PB.
The impact of Participatory Budgeting is clear. Independent evaluations have demonstrated the
positive impact of increasing engagement of residents not previously active in civic discussions;
and including youth and adults from diverse racial and economic neighborhoods to create real
solutions to the most pressing issues in underserved and underrepresented communities. PB
illustrates the most fundamental and important lesson of community organizing – those closest
to a problem should be involved in solving it.
What does it cost to implement PB?
The cost to implement PB averages .31 cents per person. For Sacramento this totals to about
$150,000 – a small price, all considered, to bring the voice of the people especially underserved
communities to the decision making process on how to best allocate the promised Measure U
resources.
Additionally, we have already secured 30-40 hours of no cost technical assistance from the
Participatory Budgeting Project to help facilitate this process. And discussion is underway on
implementing an evaluation process on the impact of allocating Measure U funds using
Participatory budgeting approaches at no additional cost to the City.
We believe that Measure U funds can and should be used to intentionally and
strategically address economic disparities based on systemic and institutionalized
racism within and across neighborhoods.
If we really want to support inclusive economic
development, then in addition to creating a portal and process for funding programs and people,
we also must also begin to radically reimagine how we structure our funding and how ‘inclusive’
we are of Sacramento residents who live in disadvantaged communities in shaping funding
priorities.
Sacramento has the chance to lead with ‘economic inclusion’ through participatory budgeting.
We acknowledge and appreciate the support, in concept, expressed from Mayor
Steinberg as read at our July 2020 Measure U Committee meeting and urge you to:
1. Re-allocate $15 million dollars in this budget year
previously allocated to the
Police Department, Fire Department, and Other CIPs, MYOPs & Debt Service
line items in the Approved Fiscal Year 2020/21 Measure U Budget to let
residents determine how to spend this portion of Measure U tax revenue.
2. Commit to increasing this investment annually by $5 million
until the total
amount allocated to participatory budgeting equals at least 50% of revenue from
the second .5 cent sales tax.
3. Make the voter determined PB funding priorities binding
, as a demonstration
of good faith.
4. Codify this commitment to democratic decision-making by incorporating
Participatory Budgeting into the City’s Charter
, to ensure PB becomes a part
of the fabric of city budgeting.
The time is now; let residents determine how to spend this portion of Measure U tax revenue
funds and model real community engagement.
Thank you for leadership,
The Measure U Community Advisory Committee
Measure U FY 2020/21 Budget Response Letter
July 31, 2020
Mayor and Councilmembers
City of Sacramento
New City Hall
915 I Street
Sacramento, CA 95815
Dear Mayor Steinberg and Councilmembers:
Sacramento’s economic forecast has changed dramatically since the Measure U Committee’s
last meeting on February 24, 2020. The Department of Finance has projected a whopping $19
million decrease in Measure U revenue for the 2020/21 budget, which threatens Mayor
Steinberg’s promise to invest in “inclusive economic development.” Indeed, this Committee
anticipated the decrease in revenue as a result of the important measures the city has taken to
protect the public’s health in the midst of the ongoing pandemic (COVID-19), including
compelling most business owners to temporarily close-up shop.
We believe—now more than ever—that it is imperative for the City to protect small business
owners who are shouldering the burden of the measures the City has taken to mitigate the
spread of the virus. Recognizing, too, that Sacramento residents are experiencing monumental
hardships related to food, housing, and job insecurities. We are asking the City to invest in
rapidly sheltering people experiencing homelessness, access to safe, affordable housing, and to
remove barriers to future economic development, especially for those communities and
residents that have been historically underserved and underrepresented and for whom
COVID-19 was especially devastating.
The current allocation of Measure U funds does not meet the significant areas of need identified
in the ballot measure
1
, most particularly
homeless supportive services, affordable housing,
libraries, park maintenance, high-wage job promotion, and youth programming
. Investments in
these areas are essential to assuring that the social, racial, health and economic disparities in
our underserved and underrepresented communities are reduced. As previously communicated
in our February 24 letter to Council, we are eager to see the promise of Measure U realized and
regret that COVID-19 prevented opportunities for strong community engagement on the
development of the 2020/21 Measure U budget.
The current budget proposal is also strikingly out of step with fervent calls from Sacramento
residents, in the wake of recent widespread protests of systemic racism, to redefine public
safety with investments identical to those proposed during the Measure U campaign. The
campaign promised
that the original half-cent sales tax--which was adopted to retain existing
services during the 2008 economic downturn--would continue to fund the initial services of
police, fire, YPCE and libraries. The additional half-cent was intended to address the issues of
1
Shall the measure to protect and enhance essential public safety services, including 9-1-1
response, fire protection, community neighborhood policing, and other essential services, including
homeless supportive services, affordable housing, libraries, park maintenance, high-wage job
promotion, and youth programming, by enacting a one-cent sales tax generating $95 million annually
that is legally required to stay in the City's General Fund, until ended by voters, with independent
annual financial audits and citizen oversight, be adopted?
homeless services, affordable housing and inclusive economic development.
According to the
Mayor, “People would not have voted for Measure U if they thought it was only going to pay for
pensions and salaries. This is now a matter of trust with the voters. None of what I described
was unknown or contradicted before the election. We knew the pension obligations, and we
made it clear that Measure U was not intended to be a solution to that problem.”
In keeping with our advisory duties, we offer the following response and recommended changes
to the proposed 2020-21 Measure U budget. Please note: The Council proposal includes
expenditures that exceed revenue by $7.3 million. Given the uncertain economic forecast and
looming pension obligations, we do not think it is wise to overspend revenue at this time, thus
our proposal only includes spending for the projected revenue.
1. Fire Department: (
Decrease by $9.2 million
)
a.
The Council’s budget proposal provides for an increase of $4.1 million from FY
2019/20. Given the economic impact of COVID-19 we recommend returning the
Fire Department allocation to the 2016/17 funding level ($13.9 million).
2. Police Department: (
Decrease by $41.7 million
)
a.
The Council’s approved 2019/20 budget increased the police allocation by $10
million from $25.7 million in FY 2018/19 to $36.3 million in FY 2019/20. In the
proposed 2020/21 budget, an additional $5 million is allocated to the Police
Department, resulting in a $41.7 million allocation, totaling half of the Measure U
revenue. We recommend against giving the Police Department more than 50%
of the revenue. Given the economic impact of COVID-19, we recommend not
funding the police department through Measure U.
3. Other CIPs, MYOPs & Debt Service (
decrease by $4.6 million
)
a.
We removed the funding for capital improvements, shot spotter, and multi-year
operating costs and retained the $250,000 to fund the FUEL Network.
4. Economic Development: (
Increase by $32.9 million
)
a.
During the campaign for Measure U, Mayor Steinberg repeatedly pledged to
spend the second half cent of the permanent Measure U sales and use tax on
“inclusive economic development”; as members of the Measure U committee we
were dismayed to learn that campaign promise was not honored when the
approved FY 2019/20 budget only allocated $6.1 million to economic
development. We are further dismayed that the proposed FY 2020/21 budget
reflects an even smaller allocation of $4.2 million, which is a paltry 10% of the
second half cent and 5% of the total Measure U revenue. While this is allowable
with a general fund tax, this breaks the social contract with voters and lessens
community confidence in our City’s leadership which is central to functional
governance. In the current economic climate, we recommend allocating $37.1
million for economic development.
b.
Furthermore, to begin the process of repairing the broken social contract, we
recommend allocating $15 million of Measure U Funds annually to: (1) fund a
participatory budgeting process in priority neighborhoods, (2) fund priority
programs and projects consistent with the purposes of Measure U identified by
the participatory budgeting process in those neighborhoods and (3) provide
ongoing City staff support and technical assistance to implement this
recommendation.
5. Homelessness: (
increase by $8 million
) Affordable Housing: (
increase by $12
):
a.
The Measure U initiative specifically referenced affordable housing and
addressing homelessness and voters indicated strong support for funding to
meet these critical needs. While Measure U funding was going to be used to
support an affordable housing bond to finance the development of new affordable
housing, the City has indicated that will not happen in the near future. Yet the
affordable housing crisis continues unabated and homelessness is increasing. In
addition, the COVID-19 pandemic has exacerbated the affordable housing crisis
and highlighted existing and historic racial inequities in health and housing.
Measure U
investments in affordable housing and homelessness are critically
needed NOW to address these inequities and the disproportionate impacts on
communities of color.
b.
The City must also commit to consulting with impacted populations, stakeholders,
and affordable housing experts when determining the specific programs to be
funded with Measure U resources,
6. Youth, Parks and Community Enrichment (YPCE) (
increase $522,000
)
a.
No major changes to the YPCE except adjustments to staffing and one-time
spending to retain current funding level (FY 2019/20).
7. Miscellaneous: (
increase by $93,000
)
a.
No major changes to the Miscellaneous Line item, except an increase to retain
FY 19/20 Staffing.
The recommendations to reduce Fire and Police Department budgets may require renegotiation
of labor contracts with the fire and police unions. Statewide unions such as SEIU are currently
renegotiating contracts to reflect the dismal economic forecast caused by COVID-19. We
reasonably expect the Mayor and Council to ask the Fire and Police Departments to make the
same sacrifices as other public employees—many of whom are essential workers who made
personal sacrifices to help keep our communities safe during the peak of the pandemic curve.
Under the California Government Code and according to case law
2
, the City of Sacramento’s
dismal budget forecast may constitute a fiscal emergency sufficient to revisit any obligations it
currently has under current union contracts.
While it was the intent of this committee to submit formal recommendations to the Council prior
to the passage of the budget, the Committee did not meet between February 24 and June 15
and as a result, was unable to collectively provide the timely citizen oversight on Measure U
expenditures that the voters were promised. While meeting cancellations were necessary to
protect public health, we are disappointed that the remote meeting support offered to the City
Council, the Planning Commission and even the City Manager’s Investment Committee were
not extended to our committee in March, April, and May, during a time when our input should
2
California Code, Government Code - GOV § 53760.5 "[A] local public entity may file a petition and
exercise powers pursuant to applicable federal bankruptcy law, if the local public entity declares a
fiscal emergency and adopts a resolution by a majority vote of the governing board at a noticed
public hearing that includes findings that the financial state of the local public entity jeopardizes the
health, safety, or well-being of the residents of the local public entity's jurisdiction or service area
absent the protections of Chapter 9.
See also
Sonoma Cty. Org. of Pub. Employees v. Cty. of Sonoma
,
for factors the California Supreme Court has identified as relevant to determine whether a fiscal
emergency may be sufficient to alter an existing contract. 23 Cal. 3d 296, 305–07 (1979).
have been included in the development of the budget. Members of the Measure U Committee
do not take our role lightly and pledged at the beginning of service to be transparent with the
community.The Committee has expressed frustration at not being provided information
necessary to perform its duties and at what appear to be active attempts to prevent our
execution of duties, such as the attempted cancellation of the June 15 meeting.
With clarity, we affirm that it is the Committee’s intent and commitment to make a meaningful
impact in assuring that Measure U funds are expended in a manner consistent with the
provisions of the ballot initiative to improve the quality of life for all Sacramento residents and
communities and to create opportunities for Sacramento residents, ensuring that no
communities and residents are left behind.Our goal is a collegial and collaborative working
relationship with the Mayor, City Council and City staff to enable the Measure U Community
Advisory Committee to best perform its duties and we ask for your full partnership with us in this.
In partnership for a thriving Sacramento,
The Measure U Community Advisory Committee
Cc:
City Manager Howard Chan
Assistant City Manager Michael Jasso
Assistant City Manager Layne Milstein
Assistant City Clerk Wendy Klock-Johnson
Finance Administration | 915 I Street, Fifth Floor | Sacramento, CA 95814-2064 | 916-808-5845 DATE:
MEMORANDUM
TO:
FROM:
March 10, 2022
Measure U Community Advisory Committee
Osvaldo Lopez, Accounting Manager
SUBJECT: Fiscal Year (FY) 2020/21 Measure U Revenue and Expenditures The allocation and spending of Measure U resources in FY2020/21 can be summarized as follows:
1. Final Measure U Budget ($131.6 million, 615.93 FTE):
Fire Department ($21.6 million, 114.50 FTE)
Police Department ($46.3 million, 261.00 FTE)
Youth Parks and Community Enrichment Department ($20.2 million, 209.43 FTE) Economic Development ($26.1 million, 17.00 FTE)
Miscellaneous Restorations ($17.4 million, 14.00 FTE) o Attachment 1
2. Measure U Sales Tax Performance Audit
o Attachment 2
Please find the following documents in the links provided below. The specific page numbers in each document that provide information on Measure U are refenced below. Annual Financial Report (AFR) – Fiscal Year Ended June 30, 2021 o http://www.cityofsacramento.org/-/media/Corporate/Files/Finance/ Accounting/Financial-Reporting/CAFR-Documents/2021-ACFR-PDF-WITH- TABS.pdf?la=en
o Reference pages iii, 2, 12, 24, 28, 33, 51, 52, 56, 73, 100, 101, 104, 106 and 216 for specific Measure U financial information.
Approved Budget – Fiscal Year 2020/21
o http://www.cityofsacramento.org/-/media/2020-2021-Budget/ FY2020_21_Approved-Operating-Budget_web.pdf?la=en
o Fiscal Management Policies - page 24
o Council Priorities – page 24
Finance Administration | 915 I Street, Fifth Floor | Sacramento, CA 95814-2064 | 916-808-5845 Approved Budget – Fiscal Year 2020/21 (Continued)
o General Fund and Measure U Forecast – pages 34-36
o Measure U Programming – page 44-46
o Measure U Financial Management Policy – pages 354-355 Midyear Report – Fiscal Year 2020/21
o https://sacramento.granicus.com/MetaViewer.php?
view_id=22&clip_id=4842&meta_id=615257 (Discussion Item 24) o General/Measure U Fund Budget Adjustments – page 4 of 51 o Midyear Forecast – page 12 of 51
o Measure U Programming Update – page 13 of 51
o FY2020/21 Measure U Programming (Exhibit D) – page 51 of 51 Fiscal Year (FY) 2019/20 Budget Update and Overview of FY2020/21 Approved Budget for the Measure U Miscellaneous Programs
o https://sacramento.granicus.com/MetaViewer.php?view_id=59&clip_id=4743- &meta_id=602103 (Discussion Item 02)
o Measure U Five-year Forecast – page 6 of 16 (includes final Measure U budget for FY2020/21)
Attachment 1
MISCELLANEOUS
PROGRAMS
Amended
Budget
Authorized
FTE Purpose of Program
MISCELLANEOUS
Library Restoration 506 - Restore library funding to the maintenance of effort (MOE) funding level required by the voter approved library parcel tax.
Library Maintenance 400 - Provide funding to address ongoing planned maintenance and repairs to help reduce and prevent equipment breakdowns for all Libraries within the City.
Animal Shelter 72 1.00 To support the robust volunteer program at the Front Street Animal Shelter and increase volunteer retention, ensure adequate training, and increase recruitment.
Illegal Dumping (Community Development) 581 6.00 To strategically reduce the vehicle abatements that have more than doubled since FY2014/15.
Illegal Dumping (Public Works) 300 - Expansion of illegal dumping services as well as to cover the ongoing program demands.
311 Call Center 272 6.00 To expand 311 services to provide additional staffing during peak hours to improve response time.
City Attorney's Office (SB1421/AB748) 208 1.00 To comply with SB1421/AB748 Police Records Releases requirements.
Youth Programs (Gang Prevention) 500 - Funding for key programs, including gun violence prevention intervention, youth development grants and evaluation.
Youth Programs (IT Internships) 120 - Provides a cost-effective alternative to augmenting full-time staff and provides students with actual work experience and assess their interest and abilities.
Sustainability 300 - Funding to implement cost-saving energy programs for City facilities and manage and implement policy direction from the City Climate Action Plan to reduce the City's greenhouse gas emissions as required by state law.
Operational Support 73 - Provide funding for IT staff due to the reduction of reimbursements from the Students Today Achieving Results for Tomorrow (START) Fund and Body-Worn Cameras Grant.
Cool Storage for Archives 165 - Provide resources for Phase II to construct and outfit a temperature controlled room to preserve the City's film and photographic collections.
Fuel Network 500 - Provide legal assistance, education, and support services to the Family, Unity, Education and Legal (FUEL) Network.
North Sacramento Library Relocation 5,000 Reolocation of the existing North Sacramento Library to a new location on Del Paso Blvd
Tiny Homes 650 Support development of tiny homes
Safe Ground Ordinance 250 Implementation of Safe Ground Ordinance Investment in Youth Programs 6,000 Set aside to invest in youth initiatives Participatory Pilot Budgeting Program 225 Establishment of participatory budgeting pilot program Tenant Protecion 89 Support the City's Tenant Protection Program Animal Care for Sac Zoo and Fairytale Town 1,171 This project will provide funding for feed, daily care and veterinary services of hundreds of animals at the Sacramento Zoo and Fairytale Town.
Measure U Programming Total 17,382 14.00
FY2020/21 Measure U Programming Update
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax
Performance Audit
For the Period of July 1, 2020 to June 30, 2021
Attachment 2
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit
For the Period of July 1, 2020 to June 30, 2021
Table of Contents
Page
Independent Auditor’s Report on Performance ............................................................................................ 1 Objectives of the Audit ................................................................................................................................. 2 Background Information ............................................................................................................................... 2 Scope of the Audit ........................................................................................................................................ 2 Procedures Performed ................................................................................................................................... 2 Results of Procedures Performed .................................................................................................................. 3 Conclusion .................................................................................................................................................... 3 Schedule of Findings and Questioned Costs ................................................................................................. 7 www.mgocpa.com
Macias Gini & O’Connell LLP
500 Capitol Mall, Suite 2200
Sacramento, CA 95814
1 Independent Auditor’s Report on Performance
To the Mayor, Members of the City Council,
and the Measure U Citizen’s Oversight Committee
City of Sacramento, California
We were engaged to conduct a performance audit of the City of Sacramento, California (City), Measure U Sales Tax funds for the period of July 1, 2020, to June 30, 2021.
We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
Our audit was limited to the objectives listed within the report which includes determining the City’s compliance with the performance requirements as referred to in the Measure U Ballot Measure approved by voters of the City of Sacramento on the November 6, 2018, ballot. Management is responsible for the City’s compliance with those requirements.
In planning and performing our performance audit, we obtained an understanding of the City’s internal control in order to determine if the internal controls were adequate to help ensure the City’s compliance with the requirements of the Measure U Ballot Measures. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
The results of our tests indicated that the City expended Measure U funds only for allowable activities as approved by the voters, in accordance with the Measure U Ballot Measure for the period of July 1, 2020, to June 30, 2021.
Sacramento, California
December 15, 2021
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit
For the Period of July 1, 2020 to June 30, 2021
2 OBJECTIVES OF THE AUDIT
The objectives of our performance audit were to document that sales tax revenues related to Measure U were deposited in the Measure U Fund and accompanied by supporting documentation from the California Department of Tax and Fee Administration; to review a list of activities and ensure they are consistent with the Measure U ballot language; to compare expenditures by category to approved budgets to determine if expenditures were in excess of appropriations; and to select a sample of expenditures and review supporting documentation that funds were expended on specific Measure U activities approved in the City Council’s budget. The objectives of our performance audit were not to determine if the City used Measure U revenues in an efficient or effective manner.
BACKGROUND INFORMATION
On November 6, 2012, voters of the City of Sacramento, California approved Measure U to enact a one- half cent sales tax for six years “To restore and protect essential public safety services, including 9-1-1 response, police officers, gang/youth violence prevention, fire protection/emergency medical response, and other essential services including park maintenance, youth/senior services, and libraries…with independent financial audits and citizen oversight”. The original sales tax expired on March 31, 2019, and a new ballot measure raising the tax to a full cent, indefinitely, was voted on November 6, 2018. The new Measure U was approved as a general tax and can be used for any general government purpose.
A five-member Measure U Citizen’s Oversight Committee was established during the year ended June 30, 2013. The purpose of the Committee was to review the City’s annual independent auditor’s report and prepare a report to City Council documenting the revenues generated by Measure U, the services and programs funded, and the results of their oversight. A new 15-member Measure U Community Advisory Committee was created in March 2019 and is responsible for providing recommendations to the City Council on how to allocate Measure U resources.
SCOPE OF THE AUDIT
The scope of our performance audit covered the period of July 1, 2020 to June 30, 2021. The population of expenditures that was subject to testing included all account and project codes associated with Measure U.
The propriety of expenditures funded through other local funding sources, other than Measure U, were not included in the scope of the audit. Expenditures incurred subsequent to June 30, 2021, were not reviewed or included within the scope of our procedures or in this report.
PROCEDURES PERFORMED
We obtained the Measure U Fund general ledger and project expenditure summary reports and detail prepared by the City for the period of July 1, 2020 to June 30, 2021. For the period, we obtained a judgmental sample of actual invoices and other supporting documentation to ensure consistency with the Measure U ballot language and compliance with the City Council’s Measure U budget, and performed the following procedures:
1)We compared the list of activities performed to verify that the list of activities is consistent with the Measure U ballot language.
2)We verified that the Measure U revenues were deposited into the Measure U Fund. 3)We traced a judgmental sample of Measure U revenue deposits to supporting documentation from the California Department of Tax and Fee Administration.
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit
For the Period of July 1, 2020 to June 30, 2021
3 4)We judgmentally selected a sample of expenditures incurred during the period and reviewed supporting documentation to ensure the funds were expended on the specific Measure U activities approved in the City Council’s budget.
5)We compared expenditures by category to the approved budget to determine if there were any expenditures in excess of appropriation.
RESULTS OF PROCEDURES PERFORMED
The City utilized Measure U funds for 133 of the 153 budgeted projects. The City recognized Measure U revenues of $116.845 million and incurred expenditures on a budgetary basis of $97.971 million and $94.259 million in accordance with accounting principles generally accepted in the United States of America (GAAP) during the fiscal year ended June 30, 2021, for the Measure U projects as shown in Table 1 (table shown in thousands).
NOTE TO TABLE
The City Manager submits a proposed budget to the City Council no later than 60 days prior to the commencement of the fiscal year. The City Council holds public hearings, modifies the City Manager’s recommendations, and adopts a final budget in June. The budget adoption resolution specifies that budgets will be controlled at the department level (i.e., police, fire, public works, parks and community enrichment, etc.) by fund.
An annual budget is adopted for the Measure U Fund. Expenditures are appropriated on a modified accrual basis of accounting, except that commitments related to purchase orders are treated as expenditures in the year of the commitment.
Budgets are modified throughout the year when the tax base changes, fees are modified, new revenue sources are identified, or programs are changed. The City Manager is authorized to administratively amend the budget during the year for transactions up to $250,000 without City Council approval. All other appropriation adjustments during the year require City Council approval. Total net budget adjustments of $21.376 million were made during the year ended June 30, 2021. Unencumbered annual budget appropriations lapse at fiscal year-end. The City honors contracts represented by year-end encumbrances and the appropriations are carried over to provide the authority to complete these transactions in future years. Multi-year project-length budget appropriations are automatically carried over in the next fiscal year.
CONCLUSION
Based on the procedures performed, the results of our testing indicated, for the items tested, the City has complied with the Measure U ballot language, in all significant respects, for the period of July 1, 2020 to June 30, 2021. Our audit does not provide a legal determination on the City’s compliance with specific requirements or a determination of whether the City used Measure U revenue in an efficient or effective manner.
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit Table 1
For the Period of July 1, 2020 to June 30, 2021
(amounts in thousands)
Actual
Amounts - Budget
Budgetary Variance with to GAAP Actual
Original Final Basis Final Budget Reconciliation Amounts Revenues:
Taxes 80,179$ 101,605$ 116,845$ 15,240 $ - $ 116,845$ Interest, rents and concessions - - 250 250 - 250 Total revenues 80,179 101,605 117,095 15,490 - 117,095 Expenditures:
General Government:
City Council
Thousand Strong 18 744 382 127 255 (80) 47 Participatory Budgeting Program - 225 - 225 - -
City Manager
C19-Sac Childcare Learn-CLASS - 733 698 35 (27) 671 Homeless Housing Initiative 38 330 37 293 - 37 Measure U Special Projects - - 1,206 (1,206) (698) 508 SHRA - Capitol Park Hotel - - 1,493 (1,493) (685) 808 Gang Prevention & Intervention 605 605 605 - - 605 California Rural Legal Assistance - 500 500 - - 500 Fuel Network 250 - - - - -
NBHD Community & Economic Plans Program34 34 - 34 - - SYDPF 2021-2023 Svcs - 4,100 - 4,100 - -
Children & Youth Prog - Overhead - 640 - 640 - -
Summer 2021 Limited CIP - 500 - 500 - -
YPCE Child & Youth Augmentation - 400 65 335 - 65 #SacYouthWorks - 2021 - 722 362 360 - 362 Sacramento Riverfront 300 300 - 300 - -
ED Initiatives 301 301 138 163 (8) 130 K to College Savings Program 61 61 61 - - 61 Iceland Restoration 1,234 1,234 186 1,048 (148) 38 Financial Empowerment 114 114 68 46 (22) 46 City Manager Youth Programs 187 187 51 136 (21) 30 Economic Development Measure U 3,702 - - - - - Measure U Community Engagement - 979 775 204 (30) 745 Measure U NDA Team - 580 295 285 - 295
Measure U NDAT Plans - 1,200 - 1,200 - -
Measure U Film Position - CCS - 153 154 (1) - 154 Measure U Community Investment - 553 538 15 - 538 Measure U Housing - 170 199 (29) - 199
Measure U ED Administration - Ops Mgr - 561 240 321 - 240 City Attorney
CAO Measure U 208 208 202 6 - 202 Information Technology
IT Measure U Program 465 465 465 - - 465 Police:
Police Measure U 41,726 - - - - -
Police Observation Dvcs (PODs) 97 97 69 28 - 69 ShotSpotter 298 298 298 - - 298 PDIT Critical Infrastructure 761 761 243 518 - 243 015 Armored Vehicle - Lenco Bear Cat - 6 - 6 - -
900Overtime - 1,053 1,053 - - 1,053
933Field & Ops - 13,405 13,689 (284) - 13,689 934 SB1421/Redaction - Public Records Release - 887 680 207 - 680 935Investigations - 1,421 1,490 (69) - 1,490 936Forensics - 714 705 9 - 705
937Communications - 502 522 (20) (3) 519
938Crime Analysis - 132 129 3 - 129
939CHRP - 6,308 6,367 (59) - 6,367
940CHP - 4,302 4,122 180 - 4,122
9412013 CHP - 1,749 1,775 (26) - 1,775
942CSOs - 4,535 4,612 (77) - 4,612
943K9 Training - 31 27 4 - 27
944Lexipol - 91 84 7 - 84
9452014 CHP - 2,606 2,565 41 - 2,565
946Police Officers x 15 - 183 - 183 - -
9472015 CHP - 2,569 2,625 (56) - 2,625
9482017 CHP - 1,760 1,829 (69) - 1,829
949Drones/UAS - 50 50 - - 50
Budgeted Amounts
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit Table 1
For the Period of July 1, 2020 to June 30, 2021
(amounts in thousands)
Actual
Amounts - Budget
Budgetary Variance with to GAAP Actual
Original Final Basis Final Budget Reconciliation Amounts Budgeted Amounts
Fire:
Fire Company Restorations 10,058$ 10,058 $ 8,342$ 1,716 $ (58) $ 8,284 $ Fire Academy 1,892 1,892 1,731 161 (4) 1,727 Fire SAFER 27 4,236 4,236 3,524 712 - 3,524 Fire Station 43 2,772 2,772 2,400 372 - 2,400 Overtime 1,000 1,000 4,279 (3,279) - 4,279 Administrative Analyst PSU 157 157 209 (52) - 209 Logistics Stores Administrator 119 119 115 4 - 115 Administrative Tech Ops Roll Call 91 91 92 (1) - 92 Logistics/Pick-up Drivers 255 255 39 216 - 39 Battalion Chief 4 933 933 854 79 - 854 Media and Communications 129 129 131 (2) (2) 129 Public Works:
PW Library 400 400 297 103 (11) 286 PW Illegal Dumping 300 300 414 (114) - 414 PW Sustainability Program 300 240 242 (2) (2) 240 Convention & Cultural Services
Animal Care for the Zoo & FTT - 1,171 1,171 - - 1,171 Youth, Parks & Community Enrichment:
Summer Youth and Community Program 89 89 - 89 - - Aquatics 2,716 2,716 1,569 1,147 (41) 1,528 Park Operations 4,506 4,727 4,509 218 (3) 4,506 Community Centers 3,966 3,966 2,979 987 (61) 2,918 Youth Enrichment 280 280 78 202 (6) 72 Recreation Administration 139 139 112 27 - 112 Older Adults 410 410 188 222 (13) 175 Park Safety Service 755 755 661 94 - 661 Youth Employment 526 526 646 (120) (5) 641 Permitting/Event 247 247 132 115 - 132 Hot Spots CC 381 381 1 380 - 1 Fiscal Administration 127 127 105 22 - 105 Summer @ City Hall 178 178 61 117 (8) 53 Youth Enrichment (ASES) 154 154 76 78 - 76 Youth Employment SYC 18 18 39 (21) (7) 32 Grant Union Pool Summer Program - - 40 (40) (40) - McKinley Park TT Emergency Ex - - 11 (11) - 11 Ninos Parkway/Rio Tierra Dev Wt - - 3 (3) - 3
Community Development:
CDD Measure U Program 1,146 - - - - -
Animal Care - 72 81 (9) - 81
Vehicle Abatement - 581 407 174 (17) 390
Tenant Protection Program 89 178 32 146 - 32 Del Paso - Marysville Blvd Plan - 85 10 75 (9) 1 Library Restoration 506 506 506 - - 506 Capital Outlay:
Information Technology:
311 Mobile Modernization 107 107 53 54 (20) 33 Police:
Body Worn Camera 2,279 2,279 861 1,418 - 861 PDIT Critical Infrastructure 200 200 - 200 - - PD Fleet Equipment & Tech 2,406 2,406 1,506 900 (210) 1,296 Police Safety Equipment 1,782 1,782 312 1,470 (2) 310 Fire:
Fire Station #14 - - 855 (855) - 855
Fire Station #15 - - 10 (10) - 10
Fire Apparatus Equipment 806 806 - 806 - - Public Works:
Energy Efficient Lighting Retrofit 405 405 364 41 (1) 363 City Facility Reinvestment Program 709 759 - 759 - - Coloma CC Water Line Replacement 403 403 188 215 (30) 158 Camp Sac Electrical Upgrade 523 523 272 251 (42) 230 Winn Park Building Rehab - 200 200 - (21) 179 McClatchy Lib. Pain/Windows 112 112 - 112 - - Pannell Flooring 299 199 199 - - 199 Belle Cooledge Lib Ext. Tile - 50 - 50 - -
North Sac Library Relocation - 5,000 42 4,958 (26) 16 Meadowview Navigation Center - - 1 (1) - 1
Broadway/Alhambra Nav. Cent. 2,554 2,769 2,801 (32) (1,043) 1,758
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit Table 1
For the Period of July 1, 2020 to June 30, 2021
(amounts in thousands)
Actual
Amounts - Budget
Budgetary Variance with to GAAP Actual
Original Final Basis Final Budget Reconciliation Amounts Budgeted Amounts
Cold Storage for Collections 653$ 653 $ 96$ 557 $ (62) $ 34$ Development of Tiny Homes - 650 570 80 - 570 Homeless Services Office Relocate - (35) 4 (39) - 4
Sac River Parkkway Bike Trail Phase 1 334 (5) 1 (6) (1) - Sac River Parkway Preliminary - 3,293 98 3,195 - 98
Sacramento EV Blueprint Phase 2 - 60 - 60 - -
SRP - Central Pocket Trail 1,854 - - - - -
Citywide Park Tree Assessment 138 138 26 112 - 26 Youth, Parks & Community Enrichment:
Swanston Fountain Recirculation - 272 257 15 - 257 Land Park Amphitheater Renovation 347 125 - 125 - - Stanford Park Restroom Replacement - 6 6 - - 6
Oki Park Restroom Renovation - - 50 (50) - 50 Mama Marks Park Improvements - 1,500 40 1,460 (3) 37 Triangle Park Playground Replace 86 86 47 39 - 47 Cesar Chavez Restroom 2 2 76 (74) - 76 Park Maintenance Irrigation System - 102 96 6 (96) - Park Improvements 35 21 4 17 - 4
Park Assessment Study 10 - 2 (2) - 2 Mama Marks Basketball Court Repair 2 2 1 1 - 1
Gardenland Park Security 31 - - - - -
Land Park Walkway Repairs 25 25 - 25 - - Oki Park Field Renovations 18 18 - 18 - - Phoenix Grn/Jacinto Crk Rep 32 32 - 32 - - City Cemetery Survey 559 559 313 246 (16) 297 Parks Sidewalk Repairs 69 419 122 297 - 122 Johnston Park Pipe Replacement - 100 - 100 - -
Ballfield Improvements 200 225 182 43 (4) 178 Park Safety Security Camera 79 110 65 45 (17) 48 Oak Park CC Crime - CCTV - - 3 (3) (3) -
St. Rose of Lima Ice Skate Ring 41 41 - 41 - - Community Gardens 13 113 14 99 - 14
Clunie Center Bathroom 14 14 - 14 - -
Cabrillo Pool Mens Restroom 220 220 - 220 - - Sutters Landing Skate Park 45 295 250 45 (3) 247 McKinley Park TT Emergency Ex (5) 43 (6) 49 - (6)
Stanford Restroom 19 13 12 1 - 12 Oki Park Pool Repairs 80 80 - 80 - - Miller Park Restroom Renovation - 350 56 294 (9) 47 Miller Park Deck Demolition - 121 - 121 - -
Garcia Bend Restroom Replacement - - 2 (2) (2) -
Hagginwood Park Turf Replacement - 25 11 14 (1) 10 Citywide Pool Assessment/Repair (30) 584 44 540 - 44 Citywide Pool Repair - Johnston 13 13 49 (36) (37) 12 Citywide Pool Repair - Mangan 94 94 7 87 (1) 6 Citywide Pool Repair - McClatchy 39 39 1 38 (1) - Citywide Pool Repair - Tahoe (83) (8) (117) 109 - (117) Citywide Pool Repair - GlennHall 158 158 118 40 (3) 115 Citywide Pool Repair - Pannell 35 35 14 21 - 14 Citywide Pool Repair - Clunie - 220 224 (4) (19) 205 Bertha Wading Pool Resurface 12 12 12 - (12) - Colonial Wading Pool Resurface 18 18 18 - (18) - Facility Improvement - Hart Senior Center (84) 46 40 6 - 40 Facility Improvement - Hagginwood CC - 174 14 160 - 14 Facility Improvement - Natomas - 300 - 300 - -
Facility Improvement - Oak Park - 29 - 29 - -
Facility Improvement - Robertson CC - 19 - 19 - -
Facility Improvement - Musco Lighting - 43 - 43 - -
Convention Cultural Services:
PA1 - Art in Public Places 5 5 - 5 - -
PA2 - Art in Public Places 6 6 - 6 - -
Transfers Out:
Stockton Blvd Housing Development - 5,000 5,000 - - 5,000 Wong Center Senior Housing - 704 704 - - 704 Total Expenditures and Transfers Out107,669$ 134,749$ 103,675$ 31,074$ (3,712)$ 99,963$
CITY OF SACRAMENTO, CALIFORNIA
Measure U Sales Tax Performance Audit
Schedule of Findings and Questioned Costs
For the Period of July 1, 2020 to June 30, 2021
7 MANAGEMENT COMMENTS AND RECOMMENDATIONS
None reported.