CITY OF SANTA MARIA
2023-24 Mid-Cycle Review
Amendments to the
Previously Adopted Budget
June 20, 2023
Topics of Discussion
• Overview of Economic Factors
• Analysis of General Fund Revenues
• Analysis of Measure U Revenues
• Overview of Proposed Amendments
• Future Issues
• Presentations about two programs
• Public Input/Comment
• Council Direction & Adoption of the Budget
Economic Outlook
Unemployment Rates
Current Year-ago
National: 3.7 percent 3.6 percent
State: 4.4 percent 4.5 percent
SB County: 3.7 percent 3.2 percent
Santa Maria: 6.4 percent 5.5 percent
Revenues – Sales Taxes
Revenues – Property Tax
Revenues - TOT
2023-24 Anticipated Revenues
Estimated Previously
Actuals Adopted Recommended Proposed
Description 2022-23 2023-24 Adjustments 2023-24
Taxes 67,742,388$ 65,780,291$ 2,485,168$ 68,265,459$ Licenses, Permits & Fines 3,622,754 3,197,050 44,584 3,241,634 Revenue from Use of Money & Property 2,005,139 1,563,513 1,396,000 2,959,513 Revenues from Other Agencies 1,488,408 732,025 (245,539) 486,486 Charges for Service 5,690,216 4,854,298 791,981 5,646,279 Other Revenue and Transfers 7,906,992 10,837,479 (600,762) 10,236,717 Total 88,455,897$ 86,964,656$ 3,871,432$ 90,836,088$ General Fund Revenues
2023-24 Proposed Appropriations
General Fund Appropriations
Department
Estimated
Actuals
2022-23
As Originally
Adopted
2023-24
Recommended
Adjustments
Proposed
2023-24
Police 32,455,680$ 36,315,649$ 486,695$ 36,802,344$ Fire 11,423,831 11,600,426 (563,414) 11,037,012 Public Works 4,345,207 4,635,807 237,769 4,873,576 Recreation & Parks 10,733,080 11,190,445 1,216,451 12,406,896 Community Development 5,359,269 7,425,921 (804,738) 6,621,183 City Attorney 1,340,437 1,210,074 155,585 1,365,659 City Manager 8,618,400 8,801,576 401,376 9,202,952 Finance 11,647,604 7,571,847 747,712 8,319,559 Mayor & Council 208,431 212,911 (6,004) 206,907 Total 86,131,939$ 88,964,656$ 1,871,432$ 90,836,088$ Local Economic Augmentation Fund
• Began Using LEAF in 2008-09
• $2.3M to be
deposited in 22-23
• Drawing $8.9M
in 23-24 ($2M to
GF and $6.9M
for Capital)
$0.00
$2.00
$4.00
$6.00
$8.00
$10.00
$12.00
$14.00
$16.00
$18.00
$20.00
13-14 14-15 15-16 16-17 17-18 18-19 19-20 20-21 21-22 22-23 23-24 $7.1 $6.3 $6.3 $6.3 $6.5 $7.3
$9.1
$11.1
$16.6
$18.9
$10.1
Millions
LEAF Reserve Balances By Fiscal Year
2023-24 Measure U Analysis
MEASURE U FUND ANALYSIS
Estimated
Actuals
2022-23
As Originally
Adopted
2023-24
Recommended
Adjustments
Proposed
2023-24
Beginning Fund Balance 17,407,947$ 9,968,157$ 15,931,355$ Projected Revenue 27,079,000$ 26,385,354$ 501,000$ 26,886,354$ Police 12,085,840$ 11,408,242$ 859,491$ 12,267,733$ Fire 11,224,345 15,375,612 2,513,051 17,888,663 Recreation & Parks 3,661,781 3,308,066 32,155 3,340,221 Library 1,065,960 1,089,891 97,936 1,187,827 Community Development 492,566 717,271 245,979 963,250 City Attorney - - - - City Manager 22,500 22,500 166,835 189,335 Finance 2,600 2,600 - 2,600 Total 28,555,592$ 31,924,182$ 3,915,447$ 35,839,629$ Ending Fund Balance 15,931,355$ 4,429,329$ 6,978,080$ Toward Reserve Policy 5,377,271
Unrestricted Fund Balance 1,600,809
6,978,080$
Measure U Enhancements
• The City Council gave direction for Measure U to
spend
– 90 percent for Public Safety
– 5 percent Youth Services
– 5 percent Quality of Life
(this includes support staff for the above services)
Measure U By Category
Measure U Appropriations
Public Safety Youth Services Quality of Life Total
Police 12,267,733$ -$ -$ 12,267,733$ Fire 17,888,663 - - 17,888,663 Recreation & Parks 1,886,879 931,754 521,588 3,340,221 Library 146,156 880,795 160,876 1,187,827 Community Development - - 963,250 963,250 City Attorney - - - - City Manager 22,500 - 166,835 189,335 Finance 2,600 - - 2,600 Total 32,214,531$ 1,812,549$ 1,812,549$ 35,839,629$ Budget Balancing Method
The $10.9 million structural gap is closed using:
• $8.9 million from Measure U reserves
• $2.0 million transfer to General Fund from LEAF
Proposed Amendments
for 2023-24
• Proposed Appropriations in
All Operating Funds = $276.7M
• Proposed Appropriations in
All Funds = $357.4M
2023-24 Appropriations
Enterprise Funds
ENTERPRISE FUNDS:
Water Resources 72,285,187$ 75,538,085$ 3,252,898$ Solid Waste 36,574,626 38,570,472 1,995,846 Public Transit 18,226,280 19,091,609 865,329 Radio/Technology 996,069 983,903 (12,166) Total Enterprise Funds 128,082,162$ 134,184,069$ 6,101,907$ American Rescue Plan Act (ARPA)
• About $37.2 million, one-time Federal funds.
• Not considered part of 2023-24 revenues
• Various projects approved by the City Council are at
various stages of planning and execution.
• Previous Council direction:
– 1) Reimburse costs incurred and revenue lost as a result of COVID-19; – 2) Invest this one-time funding in projects that can be completed in the required timeline and increase ongoing revenue or reduce ongoing costs; – 3) Strengthen the City’s financial position to prepare for future fiscal emergencies.
Proposed Staffing
Authorized Full-Time Positions– 650
• 34 New Full-Time Positions
– 19 of them are funded
• 1 New Part-Time Employee
Highlights of Changes
• Service levels largely maintained, 34 new full-time positions and 1 part-time position, and layoffs are avoided;
• General Fund appropriations are $2.0 million over-estimated revenues, but the budget is balanced by using onetime “rainy day” reserve fund; • Not financially able to restore all previously approved employee reductions or to approve requested enhancements other than necessities due to rising ongoing costs;
• Deposit approximately $7.0 million cumulatively into LEAF, capital projects fund, and pension reserves;
• The General Fund structural deficit is slightly larger, $10.97 million, from projected $10.83 million.
• Still large list of unfunded City commitments (page A-21 of adopted budget) Future Issues
• Fee adjustments
• User fees $767,000
• Leisure Fees
• Landscape Maintenance
• CalPERS (next slide)
• Workers' Compensation
• Insurance
• Capital funding
• Finance facility replacement?
• $500,000/yr for Fire Station expansion
• City Council salaries
CalPERS
• CalPERS payment in 2023-24 is $23.9 million.
• Was $5.6 million in 2005-06.
• Every dollar paid to CalPERS is a dollar less for
wages and compensation, and operations.
• Fulfills retirement promises.
• PEPRA employee cost increases July 1
– Health insurance premiums increase Jan. 1
Additional Changes, per Resolution
• Increase appropriations by $6M in the General
Capital Project Funds to complete the planned
2023-24 phase of the Fire Station #1
Expansion
• Increase appropriations by $800k in the
Liability Insurance Fund for higher property
insurance premiums
Next Steps
• Presentations about
Neighborhood Connect
and Smart City, Safe City
• Council Questions
• Receive Public Input/Comments
• Direction to Staff
- Adoption of Resolution
Final Action
• Direction to Staff
- Adoption of Resolution