HomeMy WebLinkAbout1998-05-21 City Council (5)BUDGET
’98- ’99 City of Palo Alto
City, Manager’s Report,
TO:HONORABLE CITY COUNCIL
FROM:CITY MANAGER DEPARTMENT: ADMINISTRATIVE
SERVICES
DATE:
SUBJECT:
MAY 21, 1998 CMR:248:98
RESPONSES TO FINANCE COMMITTEE QUESTIONS DURING
REVIEW OF THE PROPOSED 1998-99 BUDGET AND
RECOMMENDED CHANGES TO THE PROPOSED 1998-99 BUDGET
RECOMMENDATION
Staffrecommends that the Finance Committee approve the changes in the Proposed 1998-99
Budget, detailed in Attachments A and B.
BACKGROUND
This report responds to the questions raised by the Finance Committee during its review of
the Proposed 1998-99 Budget. It also contains the changes made by the Finance Committee
to the Proposed Budget and some changes proposed by staff for items that have come up
since the Proposed Budget document was printed. Staffrequests that the Finance Committee
review the enclosed information and approve the recommended changes to the Proposed
1998-99 Budget.
DISCUSSION
Finance Committee Questions and Requests for Information:
1.Is there any standard for the dollar amount of budget changes during the year?
There is no standard that staff is aware of. However, the Intemational City/County
Management Association and the Government Finance Officers Association provide
certain principles and recommendations with respect to budget amendments,
discussed below.
A government should periodically monitor the assumptions on which the Budget is
based, as well as changing conditions and programs or services that are not producing
the desired results. Mid-period adjustments to the budget are appropriate to address
unforseen events or significant deviations from these assumptions. Valid reasons for
CMR:248:98 Page 1 of 6
amendments to the budget include emergencies, increased expenditures which are
funded by new revenues, and approval of negotiated wage and benefit packages
(because the timing of the settlement often cannot be controlled within the budget
approval schedule). Additional authorizations to finance services should be avoided
unless they are based on additional generation of revenues.
A government should adopt policies to provide for these adjustments, as follows:
Establish a stabilization fund which may be used to address cash flow
shortages, emergencies, unanticipated economic downtums or unpredicted
one-time expenditures. A policy on minimum and maximum reserve levels
may be advisable.
Have a policy to guide the financial actions it will take in the event of
emergencies, natural disasters, or other unexpected events.
Have a policy to limit the use of one-time revenueS for ongoing expenditures.
The General Fund maintains a Budget Stabilization Reserve ($17.9 million, or 20
percent of expenditures), a Reserve for Emergencies (normally $5.6 million, reduced
this year by $1.3 million due to the flood damage), and a Reserve for Infrastructure
Improvements ($10.9 million). The City regularly appropriates a contingency amount
in the Budget for the City Manager to use for salary adjustments and other unforeseen
needs without having to return to Council for a budget amendment. Although the
Council traditionally approves a number of amendments to the Budget during a fiscal
¯ year, the Budget Stabilization Reserve has typically been replenished at year-end as
a result of budget savings.
2.Provide a proposal for improvements to downtown commute coordination.
During fiscal year 1997-98, the Commute Coordinator has designated time to provide
assistance and support to downtown area employers who are interested in developing
commute alternative programs for their employees (CMR 310:97 dated July 7, 1997).
The City agreed to provide a resource to work with the Chamber of Commerce, the
Downtown Parking Committee and Downtown employers to help them develop
Transportation Demand Management (TDM) programs for their employees. The
assistance provided has included information on model programs, transit resources,
and other TDM networking resources.
During the next few months, staff will develop a, comprehensive proposal for a
Downtown commute coordination program and will return to the Council with a
CMR:248:98 Page 2 of 6
recommendation in the Fall. During this time, staff will evaluate the possibility of a
cost sharing arrangement with the Chamber of Commerce. Staff will outline the
program components based on Downtown needs, and consider options to serve other
Palo Alto locations, including California Avenue merchants. The proposal will
include detailed information regarding resource needs for a TDM program, including
staffing requirements, staff levels, and workstation needs.
Bring back information on the total amount spent on the Geographical
Information System (GIS) to date.
From 1987-88 through April 30, 1998, $2,614,358 has been spent on GIS. Of these
actual expenditures, $988,004 has been funded by the General Fund (38 percent), and
$1,626,354 has been funded by the Utility Funds (62 percent).
How much is the maintenance for the Arts in Public Places Capital Improvement
Program (CIP) Project?
There is $5,000 in the operating budget to maintain public art. Currently a
professional conservator is assessing the condition of public art in Palo Alto. The
conservator’s report has been delayed because of the recent storms. If additional
maintenance needs are identified in the report, funds may be requested in the next
budget. ~
Provide more information on the art piece for Lytton Plaza - how much will it
cost?
There are two separate projects underway. The Public Arts Commission is working
with the Downtown Urban Design Improvements CIP Project group and has selected
artists and designs for art in Lytton Plaza. This will be paid for by the Downtown
Urban Design CIP.
In addition, the Public Arts Commission has considered placing a major piece of art
in Lytton Plaza; it has also considered Civic Center Plaza and Cogswell Plaza. This
is still in the development phase and would be paid for out of the Art in Public Places
CIP.
Are there any easement costs included in Project 19815, Arastradero Road Bike
Lane Improvements CIP?
CMR:248:98 Page 3 of 6
The CIP budget includes $10,000 for acquisition of the needed easements.
e Provide information regarding the number of tax forms distributed by the
libraries and an estimate of the staff time it takes to care for the tax forms, if
possible.
During 1998, approximately 60,400 tax forms and instructions were distributed. This
involved 1,182 hours of staff time of 29 different people (.6 FTE) to order, stock and
display the forms, and to provide public service information and directions regarding
the forms. Storage and display of the forms and instructions required 908.5 cubic
feet. Other impacts on library service include diversion of staff from other duties, loss
of storage space, lack of parking spaces during the first two weeks in April, as well
as the stressful environment created as the tax filing deadline approaches.
Other sources where taxpayers may obtain forms include U. S. Post Offices, ordering
by telephone, FAX or Internet from the Internal Revenue Service and State Franchise
Tax Board, retrieving the forms from the Internet, copying forms at commercial
photocopy services (e.g. Kinko’s has reproducible forms, is open 24 hours a day, and
copying costs are less than in the libraries), or purchasing the forms at stationery
stores.
Staff envisions informing the public early in the tax season (beginning in December)
and providing information about planning ahead and alternate sources for tax
information.
8.Provide information on the money that is spent on bank card fees.
In 1997-98, there is $26,350 budgeted for bank card fees. The 1998-99 Budget
proposes an increase of $38,300, for a total budget of $61,650. The increases are
$17,000 in Administrative Services (Revenue Collections), $1,500 in Community
Services (Arts and Culture, Cubberley, Golf Course, and Recreation), $18,000 in
Planning (Development Review, Application Review, Construction Review, and
Construction Permits), $800 in the Police Department (Animal Services), and $1,000
for the Refuse Fund (Landfill Operations).
For the adjusted 1997-98 Budget, excluding the revenue which Revenue Collections
takes in (utilities, parking tickets, etc.), revenues in areas with bank card charges were
$8,047,365. For 1998-99, again excluding Revenue Collections revenues, the
proposed revenues in areas with bank charges are $7,950.971.
CMR:248:98 Page 4 of 6
The City benefits by accepting credit card payments in the following ways: increased
interest earnings resulting from prompt receipt of funds, reductions in bad debt due
to the provision of a flexible payment option, reductions in administrative efforts
resulting from ease of credit card processing, and improved customer service.
Include sufficient funding for the special events shuttle through the July 4th
event in 1999.
There is an additional $5,000 in funding for the special events shuttle, which is a
placeholder, pending further information from staff. Of this, $1,000 is to fund a
shuttle for the July 4, 1999 festivities. The remaining $4,000 is to fund events taking
place from January 1, 1999 through June 30, 1999, because it is currently thought that
the funding in the 1998-99 budget will fund events only until the end of the 1998
calendar year, and not through the end of the 1998-99 fiscal year. The amount needed
to fund special events will be finalized for Exhibit B.
Information to be provided to Council separately, prior to Budget adoption:
1.Details regarding the proposed changes in the Public Information function.
2.Funding needs for La Comida.
RESOURCE IMPACT
The impact of the changes to the Proposed 1998-99 Budget is indicated at the end of each
fund (Attachments A and B), and will be included in Exhibit B, which the full Council
receives for Budget adoption. Attachment C is a revised General Fund Summary reflecting
the changes in Attachment A.
POLICY IMPLICATIONS
These recommendations are consistent with existing City policies.
ENVIRONMENTAL REVIEW
There is no environmental assessment required for this report.
ATTACHMENTS
Attachment A
Attachment B
Attachment C
Changes to the 1998-99 Proposed Budget (General Fund)
Changes to the 1998-99 Proposed Budget (Utility Funds)
1998-99 General Fund Summary
CMR:248:98 Page 5 of 6
PREPARED BY: Linda Craig, Senior Financial Analyst
APPROVED BY:
CITY MANAGER APPROVAL:
CC: n/a
CARL YEATSi/Director
AdministrativaCServices
vlanager
CMR:248:98 Page 6 of 6
00 0
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ATTACHMENT C:
City of Palo Alto
1998-99 GeneralFund Sumh~ary ($O00’s)
Revenues
Sales Taxes
Property Taxes
Utility Users Tax
Transient Occupancy Tax
Other taxes, fines & penalties
Service fees and permits
Charges to Other Funds
Rental Income
Other Revenues
Total Revenues
Plus Operating Transfers In
Residual Equity Transfer
Expenditures
Adminsitrative Departments
Community Services
Fire
Planning
Police
Public Works
Non-Departmental
Contingency for Prop 218
Total Expenditures
Operating Transfers Out
Adjustment for Negotiated Salary
Increases
1996-97 1997-98
Adopted
Budget
19,700
8,370
5,485
5,700
5,718
8,705
7,619 ~
9,847
9,56t
80,705
12,962
11,876 12,729 -13,678
16,514 17,466 17,856
12,841 12,723 13,290
4,498 4,666 5,085
15,354 15,856 16,273
9,970 10,748 11,134
4,816 8,168 7,079
1,000 1,000
85~95
6,090 5,812
1,251
Changes
Proposed
to Adjusted
let
5O0
230
122
171
143
(73)
661
257
96
2,107
(118)
41
1,236
243
39
417
269
2,111
(1,000)
363
%
Change
2.5%
2.7%
2.2%
3.0%
2.5%
-0.8%
8.7%
2.6%
1.0%
2.6%
0.3%
6.9%
1.8%
0.8%
2.6%
2.4%
29.8%
-100.0%
3.9%
6.2%