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Home My WebLink AboutStaff Report 1853City of Palo Alto (ID # 1853) Finance Committee Staff Report Report Type:Meeting Date: 7/5/2011 July 05, 2011 Page 1 of 2 (ID # 1853) Summary T itle: Reappropriation Title: Request to Preliminarily Approve F iscal Year 2011 Reappropriation Requests to Be Carried Forward into Fiscal Year 2012 From:City Manager Lead Department: Administrative Services Recommendation Staff recommends that the Finance Committee recommend that the Council preliminarily approve the Fiscal Year 2011 reappropriations be carried forward into Fiscal Year 2012 (Attachment 1). Background As a part of the fiscal year-end process, staff reviews the City’s unencumbered and unspent appropriations of the fiscal year just ended, along with the City’s spending plans. Encumbered amounts are those subject to the legal claims of other parties due to contractual obligations (for example, commitments made through purchase orders). The City has a process for carrying forward encumbrances. However, each year there are a small number of important projects the City carries forward into the next year with unencumbered funds. The reappropriations process is used for these projects. The Council must provide a preliminary approval at this time to allow the reappropriations to move forward, although the Municipal Code also requires that the Council provide final approval at mid-year, once the accounting books are closed. Because projects may need funding in the first part of the fiscal year, the Municipal Code was amended in 1995 to allow the Council to preliminarily approve the reappropriations (Chapter 2.28, Section 2.28.090) Discussion As noted above, the Municipal Code allows the “preliminary” approval of reappropriations as long as final approval is included with the normal year-end closing ordinance. The preliminary reappropriation action allows for an early review of uncommitted funds in a just-concluded fiscal year. Attachment A identifies those reappropriation requests that staff recommends for preliminary approval. July 05, 2011 Page 2 of 2 (ID # 1853) Resource Impact Staff has determined that sufficient uncommitted budgeted funds exist to allow for the preliminary approval of the attached Fiscal Year 2011 reappropriations list (Attachment A). General Fund proposed reappropriations total $389,290. Enterprise Fund proposed reappropriations total $1,400,221. Policy Implications, This recommendation is consistent with adopted Council policy. Environmental Review The action recommended is not a project for the purposes of the California Environmental Quality Act. Attachments: ·Attachment A: FY 2011-Reappropriations (DOC) Prepared By:Sherry Nikzat, Senior Financial Anlyst Department Head:Lalo Perez,Director City Manager Approval: James Keene, City Manager Page 1 of 3 FY 2011 REAPPROPRIATION REQUESTS SUMMARY OF REQUESTS Total Requests Total Recommended GENERAL FUND $389,290 $389,290 ENTERPRISE FUND $1,400,221 $1,400,221 INTERNAL SERVICE FUND $0 $0 TOTAL $1,789,511 $1,789,511 $ AMOUNT INTENDED USE COMMENTS/REASONS FOR NOT COMPLETING IN FY 2011 STATUS City Manager’s Office $68,890 High Speed Rail Project This reappropriation is being requested for costs related to the High Speed Rail Project which is a multi-year project without an identified source of funding. Council approved the appropriation of funds from the FY 2011 Council contingency. $68,890 represents the balance remaining from those funds and is needed for the delayed EIR, which will be completed in FY2012. Recommended $68,890. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Planning Department $221,800 Development Center Blueprint Process This reappropriation is being requested for contract services related to the Development Center Blueprint Process, a multi-year project.In FY 2011, CMR1442 increased the budget for the Blueprint Process by $115,000 for contract staff and $113,233 for salaries and benefits. A delayed start to the contracting effort resulted in remaining budget that will be needed immediately and was not included in the FY2012 budget proposal. Recommended $221,800. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Administrative Services $68,600 Fee Study This reappropriation is being requested to hire a consultant to update the cost allocation plan, municipal fee schedule, and development impact fees. Development of the RFP was delayed due to staffing shortages. The RFP is now completed and will be released early in Fiscal Year 2012. Recommended $68,600.There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Attachment A Page 2 of 3 Fire Department $30,000 Fire Chief Recruitment This reappropriation is being requested for the funding of the recruitment of a Fire Chief. CMR1442 added a budget of $50,000 for this effort. The bid process is not yet complete and a specific contract award timeframe has not yet been established. Concurrent experience with other recruitment indicates that $30,000 is more than adequate for this activity. Recommended $30,000. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Utilities Department $100,000 Organizational Assessment This reappropriation is being requested for the funding of an organizational assessment to review the services Utilities delivers and how to best deliver these services. It will include evaluating utility industry trends and challenges.This project was funded mid-year 2011.Utilities is coordinating the drafting of the scope and does not have $100,000 in its budget for FY2012 to cover this expense if not reapprorpriated.. Recommended $100,000. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Utilities Department-Electric Fund $250,000 Electric Efficiency Financing Program This reappropriation is being requested to fund rebates for customers who complete electric energy efficiency projects. There are many projects in process, but they did not complete by June 30, 2011. Recently updated Council goals are expected to increase the number of efficiency rebates in FY 2012.These energy efficiency projects support Council’s environmental sustainability objectives. Recommended $250,000. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Utilities Department –Gas Fund $230,000 Energy Efficiency Projects This reappropriation is being requested to fund rebates for customers who complete energy efficiency projects related to gas. Utilities expects to work with new vendors to increase the number of rebates issued. Funds are expected to be exhausted in FY 2012. Recommended $230,000.There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. $62,000 Energy Risk Management This reappropriation is being requested to contract for energy risk management services. These services had been part of the Energy Risk Management position. Duties will be undertaken by contractor, alongside the .5 FTE Senior Financial Analyst in the FY2012 budget, saving the City an estimated $50,000 to $100,000 per year. Recommended $62,000. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated. Page 3 of 3 Public Works Department-Storm Drainage Fund $758,221 Storm Drain Innovative Improvements This reappropriation is being requested for innovative storm drain improvements.These funds must be reappropriated because they were specifically earmarked for innovative storm drain improvements per the 2005 Storm Drainage ballot measure approved by Palo Alto property owners. These funds have been budgeted for a stormwater rebate program that offers incentives to residents and businesses to reduce stormwater runoff, but the rebate program has not generated sufficient demand to exhaust funds. Staff has proposed to utilize the unused funds to fund the Southgate Neighborhood Storm Drain Improvements CIP project, which may include permeable pavement, infiltration devices, and/or an underground cistern that could supplement irrigation water demands for Peers Park. Recommended $758,221. There is sufficient balance in the Fiscal Year 2011 budget that can be reappropriated.