HomeMy WebLinkAbout1999-03-16 City Council (6)REVISED
City of Palo Alto
City Manager’s Report
TO:’HONORABLE CITY COUNCIL
ATTENTION: FINANCE COMMITTEE
FROM:
DATE:
CITY MANAGER,
MARCH 16, 1999
DEPARTMENT:ADMINISTRATIVE
SERVICES
CMR:173:99
SUBJECT:1998-99 MID-YEAR FINANCIAL SUMMARY AND BUDGET
AMENDMENT ORDINANCE
RECOMMENDATION
Staff recommends that the City Council adopt the attached Budget Amendment Ordinance
(BAO), which reflects midyear adjustments to the 1998-99 Budget, on the basis of updated
revenue, expenditure, and reserve balance projections, a proposed Utilities Capital
Improvement Program (CIP) project for the remodel of the third floor of the Civic Center,
an adjustment to a Storm Drainage Fund CIP project, and a change .to the Table of
Organization.. .~
BACKGROUND
This report summarizes the financial results for the first six months of the fiscal year 1998-99
and updates budget projections for the full fiscal year, including reserve balances for the
General Fund and Utilities Funds. A Midyear Financial Results section presents an overview
of the adjustments being made (Attachment 1). It is followed by a more detailed discussion
of the adjustments to the revenues, expenditures, and reserves of the City’s principal funds.
DISCUSSION
The financial position of the City remains healthy. At this time, the City and State appear
to have weathered the negative effects of the severe Asian economic downturn and the recent
turbulence of world financial markets. The General Fund is projected to report a net surplus
t,,_,., ,.l,,,.,, $1.2 million in 1998-99, which represents an increase of $3.7 milli6n from
the Adjusted Budget, of which $1.8 million will be used to replenish the Budget Stabilization
Reserve (BSR) to the Council-approved maximum of $19 million. Of the
CMR:173:99 _Page 1 of 3
remainder, $.3 million will go to the Streets and Sidewalks Reserve, $.3 million to the
Reserve for Emergencies, and $1.2 million to the Infrastructure Reserve. The Electric Fund
Distribution RSR is projected to end the year above the Council-approved maximum
guideline level. The Electric Fund Supply RSR is projected to exceed the target level.
Despite a 7 percent rate decrease, the Gas Fund Supply and Distribution RSRs will continue
to exceed the maximum levels. The Water Fund RSR is projected to reach its~ maximum
level by year-end. The Wastewater Collection and Refuse RSRs both are projected to exceed
the Council-approved maximum levels, while the Wastewater Treatment RSR is projected
to exceed its target level.
Included in this report is a BAO (Attachment 2), which includes: Exhibits A and B,
reflecting the associated budget adjustments being requested and Utility Fund summaries’;
Exhibit C, the project description for proposed Utilities CIP project 19922, Renovation of
Third Floor, Civic Center; Exhibit D, amending Collection System Improvement CIP project
8870; and Exhibit E, updating the Table of Organization. The report also includes a
summary of the changes to the BSR to date (Attachment 3).
RESOURCE IMPACT
Adoption of the attached ordinance will allow for certain adjustments to the fiscal year 1998-
99 Budget, based upon updated projections and the establishment of a new Utilities CIP
project.
POLICY IMPLICATIONS
This recommendation does not represent any change to existing City policies.
ENVIRONMENTAL ASSESSMENT
This is not a project for purposes of the California Environmental Quality Act (CEQA).
ATTACHMENTS
Attachment 1
Attachment 2
Exhibit A
Exhibit B
Exhibit C
Exhibit D
¯ Exhibit E
Attachment 3
Fiscal Year 1998-99 Midyear Summary
Ordinance Approving Midyear Adjustments
General Fund, Special Revenue Funds, and Capital Improvement
Funds
Utility Funds
Renovation of Third Floor Civic Center, CIP 19922
Collection Systems Improvements, CIP 8870
Update to the Table of Organization
Changes to the Budget Stabilization Reserve
CMR:173:99 Page 2 of 3
PREPARED BY:Joyce Aung, Senior Accountant
Shannon Gaffney, Senior Financial Analyst
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
CC:N/A
CMR:173:99 Page 3 of 3
Asian economic downtum and the t’ecent turbu-
EXECUTIVE SUMMARY
REVENUE OVERVIEW AND BUDGET
lence of world financial markets, with revenues
looking stroiag ant1 prrjected to exceed the
adopted budget and prior year revenues.
GENERAL FUND
Revenue results at the midpoint of the 1998-99
fiscal year indicate a solid local and State econ-
omy. Overall, the City and State appear to be
withstanding the negative effects of the severe
1998-99 Difference1998-99 1998-99 Midyear (Midyear
Actuals1997"98Adopted Adjusted Projected Projected toBudgetBudgetBudgetAdjusted)
The only revenue area meriting surveillance is
sales tax. This important revenue stream, which
generates approximately 20 percent of the City’s ’
General Fund revenues, shows signs of flattening
in 1998-99 and potentially remaining level in
1999-00. Traditionally, however, sales tax receipts
for the fourth quarter of the
calendar year have been
strong and could provide a
small correction to this trend.
Sales Taxes $20,011 $20,200 $20,200 $20,300 $100
Property Taxes 8,903 8,635 8,635 9,135 . 500
Utility Users Tax 5,780 5,607 5,607 5,950 343
Transient Occupancy Tax 5,846 5,871 5,871 6,350 479
Other taxes, fines & penalties 6,694 5,861 5,861 6,686 825
Service fees and permits 8,872 8,849 8,849 8,589 (260)
Charges to Other Funds 7,554 8,280 8,280 8,455 175
Rental Income 10,022 10,103 9,919 9,919 0
Other Revenues 10,036 9,479 9,499 10,435 936
Plus Operating Transfers In 12,824 12,771 13,267 14,439 1,172
Plus Residual Equity Transfer 402 402 0 (402)
Plus Encumbrances and Reappropriatons 4,424 4,424 0
;- ~$96,542 $96,058 $100,814 ~ $104,682~:L_~ LL$3,868Total Sodrc~ Of Funds
Expenditures :
Administrative Departments $14,888 $13,747 $16,975 $17,007 $32
Community Services 18,484 19,123 20,497 20,707 210
Fire 13,799 13,761 14,753 14,753 0
Planning 5,702 5,159 6,897 6,777 (120)
Police 17,097 16,690 18,087 18,095 8
Public Works 11,692 11,403 13,545 13,627 82
N on-D epartm enta I 5,006 9,190 6,236 6,236 0
Tot~! Expenditnr_es"~$86,668 $89,073 $96,990 ~$97,202 " [ i:$212
Add: Operating Trans Out 7,886 6,175 6,248 6,248 0
Total Use of Funds $94,554 $95,248 $103,238 $103,450 -$212
Net Surplus/(Deficit)$1,988 $810 ($2,424)$1,232 $3,656
General Fund revenues and
other funding sources are
projected to increase by $3.9
million over the 1998-99
Adjusted Budget. This is due
in.part to strong tax reve-
nues, including property ($.5
million), transient occupancy
($.5 million), documentary
transfer ($.6 million), and
utility user ($.3 million).
Other revenue increases
include reimbursement from
the Federal Emergency Man-
agement Agency (FEMA)
for 1998 winter storm dam-
age ($.6 million), reimburse-
ment from the sale of debt
for money advanced by the
General Fund for Golf
Course improvements ($.7
million), reimbursement
from the Electric Fund for
line clearing ($.2 million), and other adjustments
totaling $.7 million. Finally, there is a reduction of
revenues associated with Sand Hill-Road develop-
ment project ($.2 million), which should not have
been part of the operating budget.
General Fund expenditures are increasing by $.2
million over the 1998-99 Adjusted Budget. This
change includes increased line clearing services
($.2 million), a one-time transfer of surplus funds
from a parks improvement CIP to the parks oper-
ating budget ($. 1 million), parks maintenance con-
tracting ($.05 million), a series of adjustments in
the Recreation Services functional area ($.04 mil-
lion) and increased
expenditures for the
addition of a part-time
clerical person in the
Office of the City Man-
ager ($.03 million).
There are reduced
expenditures associated
with the Sand Hill Road
project ($.2 million),
which should not have
adjustments, or by $1.2 million including the
changes in the 1998-99 Adopted Budget.
UTILITY FUNDS
Electric Fund revenues are projected to end the
year at $83.4 million, just below the Adjusted~
Budget. The reserve guidelines for the Electric
Fund were revised last year. The Electric Fund
Distribution RSR is project.ed to exceed the
revised Council-approved maximum guideline
level, while the Supply RSR is projected to fall
below its maximum level. The Calaveras Reserve
is projected to increase by $15.5 million, bringing
the reserve to $71.1
GEM~AL ~ Sales T~x ($Millions)
o
been part of the operat-
ing budget, and various
other adjustments resulting in decreased expendi-
tures of $.02 million.
The 1998-99 Adopted Budget included a surplus
or addition to reserves of $.8 million. Financial
results during the first six months of the fiscal year
would have increased the reserves by $3.7 million.
However, there have been $3.3 million in Budget
Amendment Ordinances (BAOs) approved by
Council during the first half of the fiscal year.
Thus, compared to the budget, reserves will
I~ 92-93
I~ 93-94
C] 95-96
=196-97
n 97-98
million, or 77 percent
of its target. The pur-
pose of this reserve is
to pay for "stranded
costs" associated with
the Calaveras Hydr0-
electric Project.
Gas Fund revenues
are projected to be
$18.8 million at
yearend, with only
minor changes from the Adjusted Budget.
Increased gas purchase costs of $1.0 million and a
7 percent rate decrease have combined to produce
a projected $3.2 million reduction in reserves at
yearend.’ However, Gas Fund Supply and Distri-
bution RSR’s will still significantly exceed the
C0uncil-approved maximum guideline levels. The
reserve surplus will be used to fund rising costs in
the Gas Fund as presented with the City Manager’s
Proposed 1999-01 Budget.
increase by a total of $.4 million due to midyear
2
r
Water Fund sales and expenditures are close to
budget in the first half of 1998-99, and only
require minor adjustments. Other expenses were
increased by $. 1 million to fund the third floor
remodel CIP project. The Water Fund RSR is pro-
jected to reach its maximum level of $7.9 million
by yearend.
Refuse Fund revenues are projected to end the
year at $24.7 million, or 3.3 percent higher than
the Adjusted Budget of $23.9 million. The RSR
projected balance at yearend is $6.0 million, rep-
resenting an increase of $1.0 million from the
Adjusted Budget projections. The RSR projected
ending balance will be above the maximum guide-
line of $3.7 million.
Other Utility Funds: Minor changes in budgeted
revenues, expenditures, and reserves are projected
for the Wastewater Collection, Wastewater Treat-
ment, and Storm Drainage Funds. The Wastewater
Collection Fund RSR is projected to exceed the
Council-approved maximum guideline. The
Wastewater Treatment Fund RSR will exceed the
C0uncil-approved target.
GENERAL FUND
REVENUES
Overall, General Fund revenues and other funding
sources are projected to exceed the 1998-99
Adjusted Budget by $3.9 million. This increase is
the result of a variety of adjustments, discussed
below.
After double-digit increases in sales tax receipts in
1995-96 and 1997-98 over prior years, sales tax
revenues appear to be leveling off in 1998-99. It is
projected that by yearend, receipts will be $. 1 mil-
lion, or.5 percent above budget, and $.3 million, or
1.5 percent above 1997-98 levels. Key economic
segments’showing’declines in 1998-99 are elec-
tronic and department store sales. Electronic sales,
which have shown considerable volatility over
time, experienced sharp declines in the last two
quarters. Severe competition and weak Asian sales
have contributed to lower receipts. Key gains in
1998-99 have come from the auto sales and mis-
cellaneous retail segments. Since auto sales have
contributed heavily to Palo Alto’s sales tax growth
Property Tax ($Millions)
over the past three years, this revenue source
requires monitoring, given the cyclical nature of
the auto industry. The City continues to realize
higher property tax receipts from the significant
increase in property values over the past few
years. Budgeted property taxes are being raised by
$.5 million, or 5.8 percent. Revenues at yearend
are expected to be $.2 million, or 2.6 percent
above prior year levels. Recent County efforts to
reflect current valuations on the property tax rolls
and to erase a backlog of appeals have led to sig-
nificantly higher receipts in 1997-98 and 1998-99.
Based on utility user tax (UUT) telephone receipts
during the first half of 1998-99, staff recommends
increasing the Adopted Budget by approximately
$. 1 million. UUT telephone revenues are expected
to total $1.8 million at yearend, approximately 3.3
percent higher than 1997-98 revenues.~Strong
business activity and continued growth in Internet
lines are the likely causes of revenue growth. UUT
revenues from utility sales have been robust in
Transient Occupancy Tax ($Millions)
~92-93
1193-94
~94-95
1998-99. As a consequence of higher than bud-
geted electric and gas sales due to a cold winter,
UUT revenues have exceeded budget. It is recom-
mended that the budget for these revenues be
raised by $.25 million.
As in the past several years, the City’s hotels and
motels are reporting consistently higher transient
occupancy tax (TOT) receipts. It is anticipated
that TOT revenues at yearend will exceed prior
year actuals by around $.5 million. Staff recom-
mends, therefore, increasing the adopted budget
by $.5 million, to $6.4 million. Despite local and
industry-wide data indicating that occupancy rates
are dropping due to hotel expansions and concerns
over the economy, the significant increase in room
rates in 1998 is expected to be sustained in 1999.
Mirroring the vigorous local real estate market
and rise in property values, documentary transfer
taxes are projected to equal $2.9 million at
yearend, or $.6 million above the Adopted Budget.
This is a somewhat conservative estimate, given
that $3.0 million in transfer tax revenue was real-
ized in .1997-.98...These revenues are difficult to
project, since they are especially sensitive to the
mix, from year to year, of residential and commer-
cial properties. While there have been a consider-
able number of commercial transactions this Year
and last, it is uncertain whether they will continue.
It is important to note that transfer tax revenues as
recently as 1996 and 1997 were around $1.9 mil-
lion.
Other significant revenue adjustment~ include
increasing the Adopted Budget for Motor Vehicle
In Lieu taxes by $.2 million, to more closely
match 1997-98 actuals; recognizing receipt of $.6
million from FEMA for damage incurred during
the 1998 winter storm; recognizing reimburse-
ment from San Francisco Airport to fund marsh
improvements ($.2 million); funding from the
Electric Fund to cover increased line clearing
activity ($.2 million); reduced revenue for Sand
Hill Road reimbursements which should have
Utilities User Tax ($Millions)
r’:’192-93
~193-94
r-194-95
E~ 95-96
[] 96-97
r"197-98
been funded out of a Development Account ($.2
million); and various adjustments adding $.05 mil-
lion in revenue.
Adjustments to Operating Transfers In include a
4
transfer from the Golf C~urse to cover money
advanced by the General Fund for expenditures
made while awaiting the issuance of debt ($.7 mil-
lion), and a transfer of one-time surplus funds
from CIP 19414, Irrigation Improvements, to the
operating budget for parks improvements ($. 1 mil-
lion).
EXPENDITURES
Except for the expen-
diture changes which
are discussed below,
the General Fund
departments are on
target with the 1998-
99 Adjusted Budget.
General Fund depart-
ments will likely
show savings at
yearend, consistent
with prior years’ expe-
rience. Because these
savings will vary from
department to depart-
Debris Boxes: There is additional funding of
$25,000 for debris boxes. This money will be used
to continue’to provide refunds to residents who
require debris boxes as a result of the 1998 winter
storms.
Recreational Services Adjustments: There. are a
number of adjustments in the Recreation Services
.Functional Area in the Communi~ Services
Budget Stabilization $i9,051 $1,379
Sllx~tsiSidewalks 263 (341)
Etm, gmeies 5,875 (228)
infmsmxzture Impmvemen~12,588 0
Reserve for Unrealized
Gain/(I_o~) on lnveslments 450 0
Reappropdation/Encumbrane~5,036 0
Inventory andNotes R~eivabh 2,642 0
($3~209)$1,830 $19,051 $0
343 265 2
(47) 275 5,875 0
1,208 13,796 1,208
450 0
5,036 ,"0
2,642 0
$45,905 $810 ($3,256) $3,656 $47i115
ment, they are not included in the attached BAO
or in the General Fund Summary.
Tree Trimming: Funds are being added for tree
trimming contract services in Public Works to
clear around utility power lines ($175,000). The
California Public Utilities Commission requires
greater clearance distances around power lines,
and there continues to be increased tree growth
due to several years of heavy winter rains. These
costs are reimbursed by a transfer from the Elec-
tric Fund.
Department. Due to
the closure of Rin-
conada Pool for
repairs, there are both
reduced revenues
($72,000) and
reduced expenditures
($43,000). In addi-
tion, there are
increased expendi-
tures of $50,000, due
to increased usage of
Recreation programs
(this is offset by an
equal revenue
increase). Finally,
there are increases of
$41,000, all offset by grants and donations from
the Recreation Foundation and other groups.
Sand Hill Road Project: There are redu.ced
expenditures of $238,000 associated with the Sand
Hill Road project. These should have been bud-
geted for in a Development Account, instead of
the operating budget. There has been a corre-
sponding decrease in revenues.
Police Department: The Police Department has
increased expenditures of $8,000, due to the
receipt of two grants (there has been a correspond-
ing increase in revenues). The first is from. the
American Society for the Prevention of Cruelty to
Animals National Shelter Outreach program
($1,500), and a matching grant ($1,500) from
PetSmart Charities, both to be used for improve-
ments at the animal shelter. The other grant of
$5,000 comes from the State of California’s Office
of Traffic Safety, through the Santa Clara County
Traffic Safe Communities Network, to fund
increasing pedestrian safety awareness, while
reducing motor vehicle/pedestrian collisions in the
downtown area.
In addition, there is a possibility that the Police
Department will exceed its overtime budget by the
end of the year. It is anticipated that the Depart-
ment will have salary savings to cover this. How-
ever, if an adjustment is necessary, it will be
included in the 1998-99 Yearend Report.
Miscellaneous Adjustments: There are miscella-
neous expenditure adjustments to fund a conflict
of interest study ($5,000), to add a part-time cleri-
cal person in the Office of the City Manager
($27,000), for one-time parks improvements
($100,000), for parks maintenance contracting
($54,000), and for changes to the Golf Course
pro’s contract ($8,800).
CAPITAL IMPROVEMENT FUND
The project number of the Capital Improvement
Program (CIP) project, Major Intersection
Improvements (19073), is being changed to 9973
to better allow for project management and
accounting. There is no change in the amount bud-
geted or the project name.
A new CIP project, Renovation of Third Floor,
Civic Center, CIP 19922, is being proposed. This
will fund the renovation and configuration of the
6
third floor of City Hall, so that Utilities, staff from
the eighth floor and the mezzanine can be consoli-
dated there. This is being funded by the Utilities
Funds.
UTILITY FUNDS
The City continues to proactively respond to the
challenges posed by the deregulation of the elec-
tric and natural gas industries. To provide for more
effective tracking of the supply and distribution
components of the electric and gas utilities, Palo
Alto is dividing both the Electric and Gas Funds
into separate "supply" and "distribution" business
units. Accordingly, the Rate Stabilization
Reserves (RSR’s) have been separated for the
"supply" and "distribution" business units.
ELECTRIC FUND
Electric Fund sales to local customers were $1.9
million higher than budget at midyear, mainly a
result of an increase in energy usage during the
warmer E1 Nino summer months. In addition, the
City’s wholesale power sales exceeded the mid-
year budget by $1.0 million. Although local and
wholesale sales were slightly higher than expected
at midyear, staff projects Electric Fund sales to be
on budget for the fiscal year. Other revenues have
been adjusted downward by $0.4 million, due to a
staff vacancy in the marketing team for fiber optic
sales.
Power purchase costs are $.5 million above budget
at midyear, primarily due to the purchase of addi-
tional power for local and wholesale customers.
Power purchase costs are projected to end the year
on budget. Other expenses are projected to
increase by $. 1 million in 1998-99. The adjust-
ments include: a $.2 million increase in line clear-
ing costs to comply with Government Order 95,revenue budget at this time.
which requires a minimum of 18 inches clearance
from primary conductors at all times; a $.3 milliori ---Tho price of natural gas has risen moderately since
increase to fund the Civic Center Third Floor the budget was adopted. Gas purchase costs,
remodel CIP project; a $.3 million reduction in
debt service expense, resulting from the ref’manc-
ing of California Oregon Transmission Project
debt; and a $. l~million decrease resulting from
cost savings from the closure of the MSC Security
Improvement CIP project (19311).
A revised reserve policy and modified guideline
levels for the Electric Fund Supply and Distribu-
tion business units were adopted by Council last
year. The Electric Fund Supply RSR is projected
to be $11.4 million at yearend, $1.6 million above
the revised Council-approved target level. The
Electric Fund Distribution RSR is projected to end
the year at $6.8 million, $.9 million above the
revised Council-approved maximum level. The
Calaveras Reserve is projected to reach $71.1 mil-
lion, an increase of $15.5 million from the prior
year, bringing the reserve to 77 percent of the tar-
get to be funded by 2001.
The projected revenue for Public Benefit Program
(PBP) is $1 million, while the projected PBP
expenditures will total $.8 million. The PBP
Reserve is projected to increase to $1.7 million at
yearend. The Council recently approved a PBP
and expenditures associated with it.
GAS FUND
At midyear, Gas Fund sales revenue is $.6 million
higher than planned, principally due to drier and
colder weather conditions in Northern California.
Although sales have increased, staff believes that
it does not warrant an adjustment of the Gas Fund
which reflect higher prices and increased gas con-
sumption, were $.4 million above budget at mid-
year. In order to cover the additional cost, a $1
million increase in purchase costs is requested.
Other expenses are being increased by $. 1 million
to fund the Civic Center Third Floor Renovation
CIP project. Despite a 7 percent reduction in rates,
the Gas Supply RSR is projected to end the year at
$5.7 million, and the Distribution RSR is pro-
jected to be $7.5 million, both of which signifi-
cantly exceed the Council-approved maximum
guideline levels. A revised reserve policy for the
Gas Fund Supply and Distribution business units
was adopted by Council with the 1998-99 Budget.
WATER FUND
Water Fund sales show a slight decrease at mid-
year, with a corresponding decrease in water pur-
chase costs. The Water Fund RSR is proje.cted to
increase by $.4 million in 1998-99, reaching its
maximum level of $7.9 million.
REFUSE FUND
Refuse Fund revenues are projected to increase by
$.8 million, due to higher than anticipated disposal
fee revenue, investment income and one-time rev-
enues. Refuse Fund expenditures are projected to
be $. 1 million less than budget, as a result of posi-
tion vacancies.
The yearend Refuse RSR is projected to end the
fiscal year at $6.0 million, which is $2.3 million
above the Council approved maximum guideline
of $3.7 million. This excess may be used to defer
future costs, including changes to the contract
with PASCO, the need to increase-tonnage-deliv-
ered to the SMART station to keep the Palo Alto
landfill open until its projected closure date in
2011-12, and other costs associated with future
changes in refuse services.
It should be noted that salary savings in the Refuse
Fund are anticipated to be used to pay the United
States Environmen-
tal Protection
Agency (USEPA)
for a de minimus
settlement at the
Casmalia Disposal
Site in Santa Bar-[] 199~-99
bara, California.~ ~¢t _
The City sent rela-
tively small
amounts of hazard-
ous waste material
to the Casmalia site
between 1973 and
1989. The opera-
tors shut down the site without following proper
closing procedures, resulting in the City having a
minor liability. Staff plans to provide a full report
to the Council regarding this settlement in the near
future.
WASTEWA TER COLLECTION FUND
ter Collection RSR of $8.8 million exceeds the
Council-approved maximum guideline level of
-$5.1 million.
WAS TEWA TER TREATMENT FUND
Wastewater Treatment Fund revenues are pro-~
jected to be $16.0 million, with a $.4 million
reduction in reserves, which is no change from the
original budget. The projected yearend reserves of
$2.9 million
Utility Funds Reserve Summary ($000s)
~m 1998-99
Targets
Wastewater Collection Fund revenues are pro-
jected to be $18.7 million, with a $1.4 million
addition to reserves, which is no change from the
original budget. The projected yearend Wastewa-
exceed the
Council target
guideline.
STORM
DRAINAGE
FUND
Storm Drain-
age Fund reve-
nues and
expenses are
projected to end
the year on budget. However, there is a transfer
required between the operating budget and the
capital budget in the amount of $. 1 million for
engineering salary costs related to CIP projects
(the amended CIP is attached to the Budget
Amendment Ordinance). The Storm Drainage
RSR is projected to be $0.3 million at yearend.
There is no Cotmcil reserve guideline for this
Fund. Staff has a rate proposal before the Finance
Committee for the financing of the next phase of.
Storm Drainage Fund improvements.
ATTACHMENT 2
ORDINANCE NO.
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET.FOR THE FISCAL YEAR 1998-99 TO ADJUST
BUDGETED REVENUES AND EXPENDITURES IN ACCORDANCE WITH~THE
RECOMMENDATIONS IN THE MIDYEAR REPORT
WHEREAS, pursuant to the provisions of Section 12 of Article
iII of the Charter of the City of Palo Alto, the Council on June 22,
1998 did adopt a budget for fiscal year 1998-99; and
WHEREAS, after reviewing the current budgeted revenues and
expenditures for fiscal year 1998-99, adjustments to the budget are
recommended to more accurately reflect year-end projections; and
WHEREAS, City Council authorization is neede~ to amend the
1998-99 budget as hereinafter set forth.
NOW, THEREFORE, the Council of the City of Palo Alto does
ORDAIN as follows:
SECTION i. The sum of One Million Eight Hundred Thirty
Thousand Five Hundred and Ninety Four dollars ($1,830,594) is hereby
added to the Budget Stabilization Reserve (BSR) in the General Fund
to reflect the revenue and expenditure changes as described in
Exhibit A, which is attached to this ordinance and incorporated
herein by this reference. As a result of these changes, the
budgeted BSR will increase from $17,219,994 to $19,050,591.
SECTION 2. The sum of One Million Two Hundred-Seven Thousand
Six Hundred and Eighty Eight dollars ($1,207,688) is hereby added
to the Reserve for Infrastructure Improvements, as described in
Exhibit A. As a result o’f this change, the Infrastructure Reserve
will increase from’S12,588,000 to $13,795,688.
SECTION 3. The sum of Three Hundred Forty Three Thousand
dollars ($343,000) is hereby added to the Streets and Sidewalks
Reserve in the General Fund to reflect Utility User Tax revenue
changes as described in Exhibit A. As a result of this change, the
budgeted Streets and Sidewalks Reserve will be at $264,855.
SECTION 4. A new Capital Improvement Project, No. 19922,
Renovations Third Floor, Civic Center, described in Exhibit C and
incorporated herein by this reference, is created and the sum of
$460,000 is appropriated to it. Funding in an equivalent amount is
provided with interfund transfers from various Utilities Funds, as
described in Exhibit A.
SECTION 5. The sum of $141,482 is hereby appropriated to
Capital Improvement Project No. 8870, Collection System
Improvements, as described in Exhibit D, and incorporated herein by
this reference. The funding for this project is already budgeted in
the Storm Drainage Fund.
SECTION 6. Capital Improvement Project No. 19073, Major
Intersection Improvements, in the Public Works Department, is
changed to Major Project No. 9973, Major Intersection Improvements.
There is no change in the amount budgeted for this project.
SECTION 7. The Table of Organization is amended to reflect the
changes as shown in Exhibit E which is incorporated herein by this
reference.
SECTION 8. The sum of One Hundred Two Thousand Six Hundred
and Thirty Nine dollars ($102,639) is hereby added to the budgeted
Distribution Rate Stabilization Reserve in the Electric Fund to
reflect changes in the Electric Fund as described in Exhibit B,
which is incorporated herein by this reference.
SECTION 9 The sum of One Hundred Fifty Five Thousand Eight
Hundred and Ninety One dollars ($155,891) is added to the Calavaras
Reserve in the Electric Fund to reflect changes in the Electric Fund
as described in Exhibit B.
SECTION i0. The sum of One Hundred Seventy Seven Thousand
dollars ($177,’000) is hereby added to the Public Benefit Program
Reserve in the Electric Fund to reflect changes in the Electric Fund
as described in Exhibit B.
SECTION ii. The sum of Eighteen Thousand and Forty Seven
dollars ($18,047) is hereby reduced fgom the Distribution Rate
Stabilization Reserve in the Gas to reflect changes in the Gas Fund
as described in Exhibit B. "
SECTION 12. The sum of One Million One Hundred Fourteen
dollars ($1,000,1i.4) is hereby reduced from the Supply Rate
Stabilization Reserve in the Gas Fund to reflect changes in the Gas
Fund as described in Exhibit B.
SECTION 13. The sum of Seventy Eight Thousand Three Hundred
and Forty Two dollars ($78,342) is hereby reduced from the Rate
Stabilization Reserve in the Water Fund to reflect changes in the
Water Fund as described in Exhibit B.
SECTION 14. The sum of Nine Hundred Sixty Four Eight Hundred
and Fifty One dollars ~($964,851) is hereby added to the Rate
Stabilization Reserve in the Refuse Fund to reflect changes in the
Refuse Fund as described in Exhibit B.
SECTION 15. The sum of Six Thousand Six Hundred and Eight One
dollars ($6,681) is hereby reduced from the Rate Stabilization
Reserve in the Wastewater Collection Fund to reflect changes in the
Wastewater Collection Fund as described in Exhibit B.
SECTION 16. The sum of Three Thousand Five Hundred and Thirty
Seven dollars ($3,537) is hereby added to the Rate Stabilization
Reserve in the Wastewater Treatment Fund to reflect changes in the
Wastewater Treatment Fund as described in Exhibit Bo
SECTION 17. The sum of Five Hundred and Ninety Two~ dbllars
($592) is hereby reduced from the Rate Stabilization Reserve in the
Storm Drainage Fund to reflect changes in the Storm Drainage Fund
as described in Exhibit B.
SECTION 18. As specified in Section 2.28.080(a) of the Palo
Alto Municipal. Code, a two-thirds vote of the City Council is
required to adopt this ordinance.
SECTION 19. The Council of the City of Palo Alto hereby finds
that this midyear adjustment is not a project under the California
Environmental Quality Act and, therefore, no envirQnmental impact
assessment is necessary. However, projects described in this
ordinance will be assessed individually as appropriate.
SECTION 20. As provided in Section 2.04.350 of the Palo Alto
Municipal Code, this ordinance shall become effective upon adoption.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:APPROVED:
City Clerk Mayor
APPROVED AS TO FORM:City Manager
Senior Asst. City Attorney
A:\mdyrbao.doc
Director of
Services
Administrative
EXHIBIT A
1998-99 Midyear Adjustments
General Fund, Special Revenue, and Capital Improvement Funds
Activity Object
Code Code Description ~h~nge
Revenues
02000000 1188 Sales Tax 100,000
02000000 1101 Property Tax- Secured 360,000
02000000 1103 Property Tax - Unsecured 100,000
02000000 1107 Property Tax -- Airplane Tax ~-~40,000
02000000 1185 Transient Occupance Tax 479,000
02000000 1180 Documentary Transfer Tax 600,000
02000000 1183 Motor Vehicle in Lieu Tax 225,000
02000000 1505 Reimbursement from FEMA for 1998 Storm Damage 626,497
Reimbursement from San Francisco Airport for Harbor Marsh
02000000 1599 CIP 180,000
Transfer from the Capital Improvement Fund for Golf Course
02000000 2041 project 670,720
Correction to transfer from the Capital Improvement Fund for
02000000 2041 closed or reduced projects 370,000
02000000 2041 Transfer from the Capital Improvement Fund for CIP 19414 100,000
Correction to transfer Arrillaga funds for Family Resources
Center
Correction for transfer of funds from the Capital
Improvement Fund for closed or reduced projects
Correction for transfer of Arrillage funds
Reimbursement from BAAMQD and Santa Clara County
Electric Line Clearing Service
Sand Hill Road revenues to be held in Developers Account
Sand Hill Road revenues to be held in Developers Account
Traffic safety grant
Grant from American Society for the Prevention of Cruelty to
Animals
Revenue adjustments due to contract with Golf Pro
Revenue adjustments due to contract with Golf Pro
SAP contribution
Revenue reductions due to closure of Rinconada pool for
repairs
Revenue reductions due to closure of Rinconada pool for
repairs
02000000 2065
02000000 2070
02000000 2070
02414210 1899
02513250 1925
02515290 1489
02614200 1323
02704100 1537
O2707320 1555
02813210 1609
02813210 1611
02817340 1801
02818391 1344
02818391 1348
32,000
(370,000)
(32,000)
79,500
175,000
(118,000)
(120,000)
5,000
3,000
(12,000)
13,500
3,000
(41,973)
(18,189)
Page 1
EXHIBIT A
1998-99 Midyear Adjustments
General Fund, Special Revenue, and Capital Improvement Funds
Activity Object
Code Code
02818402 1344
02818402 1348
02818412 1348
102818406 1348
102818413 1801
02818430 1801
Description
Revenue reductions due to closure of Rinconada pool for
repairs
Revenue reductions due to closure of Rinconada pool for
repairs
Revenue reductions due to closure of Rinconada pool for
repairs ~
Increased revenue due to increased usage of recreation
Various contributions to Recreation
Recreation Foundation contribution for Snowmen and Sleigh
Event
Change in General Fund Revenues
Expenditures
02141110 3199
02111100 3001
02111100 3099
02511100 3199
02513253 3126
02515290 3199
02613200 3199
02704100 3299
02707320 3599
02813210 3144
02814220 3126
02814220 3199
02817340 3199
02818391 3003
02818391 3107
02818402 3003
02818402 3107
Funds for conflict of interest study
Half-time clerical person in City Manager’s Office
Half-time clerical person in City Manager’s Office
Refunds for debris boxes from 1998 storm.
Electric Line Clearing Service
Sand Hill Road expenditures to be funded out of Developers
Account
Sand Hill Road expenditures to be funded out of Developers
Account
Traffic safety grant
Grant for animal shelter improvements
Adjustment to reflect CPI changes in GolfPro’s contract
Parks maintenance contracting
Transfer of funds from CIP 19414 to fund one-time parks
projects
SAP contribution for Exhibit
Expenditure reductions due to closure of Rinconada pool for
repairs
Expenditure reductions due to closure of Rinconada pool for
repairs
Expenditure reductions due to closure of Rinconada pool for
repairs
Expenditure reductions due to closure of Rinconada pool for
repairs
Page-2
Change
(10,033)
(1,772)
(166)
50,000
21,077
16,500
3,525,667
5,000
23,034
4,065
25,000
175,000
(118,000)
(120,000)
5,000
3,000
8,800
54,000
100,000
3,000
(13,396)
(8,561)
(10,282)
(10,821)
EXHIBIT A
1998-99 Midyear Adjustments
General Fund, Special Revenue, and Capital Improvement Funds
02818412
Activity Object
Code Code Description -Ch’ange
Expenditure reductions due to closure of RJnconada pool for
3003 repairs (371)
Increased expenditures to cover increased usage of Recreation
02818406 3107 programs 50,000
02818413 3003 Contributions in support of Recreation services 13,732
02818413 31.07 Contributions in support of Recreation services "7,345
02818430 3199 Recreation Foundation support of Snowmen and Sleigh Event 16,500
Change in General Fund Expenditures 212,045
Net Change in General Fund 3,313,622
02000000 3822 Budget Stabilization Reserve 1,830,594
02000000 3850 Infrastructure Reserve 1,207,688
Net Change in General Fund Reserves 3,038,282
03000000
03000000
03000000
1186 Utility Users Tax -- City Utilities
1 i87 Utility Users Tax -- Telephone
Net Change in Utility User Revenues
3823 Streets and Sidewalks Reserve
3850 Reserve for Emergencies02000000
250,000
93,000
343,000
343,000
275,340
EXHIBIT A
1998-99 Midyear Adjustments
General Fund, Special Revenue, and Capital Improvement Funds
Activity Object ,
Code Code Description
CAPITAL IMPROVEMENT FUND
71000000 2051 Transfer for CIP 19922, Renovation of Third Floor, Civic
71000000 2052 Transfer for CIP 19922, Renovation of Third Floor, Civic
71000000 2053 Transfer for CIP 19922, Renovation of Third Floor, Civic
71000000 2054 Transfer for CIP 19922, Renovation of Third Floor, Civic
Change in Capital Fund Revenues
71000000 3879
71000000 3879
71000000 3879
71000000 4011
71000000 3850
71000000 4011
71000000 4011
71000000 4051
71000000 4052
71000000 4053
71000000 4054
71000000 4055
71000000 4056
71000000 4057
CIP 19922, Renovation of Third Floor, Civic Center
Reduce CIP project expenditures for closed or reduced
Reduce CIP 19414 to fund other parks projects
Transfer funds from CIP 19414 for other parks projects
Golf Course Improvements Reimbursement
Transfer to General Fund for Golf Course Improvements
Transfer to General Fund for closed or reduced CIP projects
Transfer to Water Fund for closed or reduced CIP projects
Transfer to Electric Fund for closed or reduced CIP projects
Transfer to Gas Fund for closed or reduced CIP projects
Transfer to Wastewater Fund for closed or reduced CIP
Transfer to Refuse Fund for closed or reduced CIP projects
Transfer to Storm Drainage Fund for closed or reduced CIP
projects
Transfer to Wastewater Treatment Fund for closed or reduced
CIP projects
Change in Capital Fund Expenditures
Net Change to Capital Fund
Ch:~nge
59,800
289,800
101,200
9,200
460,O00
460,000
(570,000
(100,000)i
lO0,O00
(670,720
670,720
370,000
27,874
106,315
41,853
15,579
4,337
505
3,537
460,000
Page~4
Exhibit B
1998-99 Midyear Adjustments
Enterprise Funds
Activity Object
Fund Code Code
Utilities Administration
21 210000 1910
’21 211120 3100
21 211120 3200
21 211120 3300
21 211120 3500
Descriptio.n
Utilities Administration - Allocated G & A
Public Relations - Contract Services
Public Relations - Supplies and Materials
Public Relations - General Expense
Public Relations - Facilities & Equip Purchase~
Net Change in Utilities Administration
Change
101,000
(55,000)
(17,000)
(21,000)
(8,006)
0
Electric Fund
23 210000 3910
23 230100 3100
23 230100 3200
23 230100 3300
23 230100 3500
23 000000 1723
"23 000000 1724
23 000000 1725
23 000000 1726
23 000000 1727
13 231160 3315
23 250220 3925
23 241260 3402
13 242260 3402
23 000000 2041
13 000000 4041
23 000000 4041
23 270200 3310
Utilities Administration - Allocated G & A
Contract Services
Supplies and Materials
General Expense
Facilities & Equipment Purchases
Fiber Optic Advance Engineering Fees
Fiber Optic Intercormection Fees ¯
Fiber Optic License Fees
Fiber Optic Drop Cable Management Fees.
Fiber Optic Miscellaneous Revenue
Joint Agency Debt Service Expense
Electric Line Clearing
Rent - Facilities (CIS Training Facility)
Rent - Facilities (CIS Training Facility)
Transfers from Capital Improvement Progrmn Fund
Transfers to Capital Improvement Program Fund
Transfers to Capital Improvement Program Fund
Demand Side Management Programs
Net Change in Electric Fund
(48,167)
40,000
8,000
6,000
5,000
(10,000)
(216,000)
(231,000)
33,000
(50,000)
319,000
(175,000)
(15,909)
(15,909)
106,315
(147,200)
(142,600)
970,000
435,530
Changein Reserves
23 000000 3804
13 000000 3817
13 000000 3808
23 000000 3816
Distribution Rate Stabilization
Supply Rate Stabilization
Calaveras
Public Benefit Program
102,639
0
155,891
177,000
Net Change in Electric Fund Reserves 435,530
Page 1
Exhibit B
1998-99 Midyear Adjustments
Enterprise Funds
Activity Object
Fund Code C6de
Gas Fund
24 210000 3910
24 230100 3100
24 230100 3200
24 230100 3300
24 230100 3500
14 231160 3604
14 231160 3607
24 241260 3402
14 242260 3402
24 000000 2041
14 000000 4041
24 000000 4041
ChangeinReserves
24 000000 3804
14 000000 3817
Water Fund
22 210000 3910
22 230100 3100
22 230100 3200
22 230100 3300
22 230100 3500
22 250210 3567
22 241260 3402
22 000000 2041
22 000000 4041
ChangeinReserve
22 000000 3804
Descriptio. n
Utilities Administration - Allocated G & A
Contract Services
Supplies and Materials
General Expense
Facilities & Equipment Purchases
Gas Commodity Purchase
Utility Commodity Transmission
Rent - Facilities (CIS Training Facility)
Rent - Facilities (CIS Training Facility)
Transfers from Capital Improvement Program Fund
Transfers to Capital Improvement Program Fund
Transfers to Capital Improvement Program Fund
Net Change in Gas Fund
Distribution Rate Stabilization
Supply Rate Stabilization
Net Change in Gas Fund Reserve
Utilities Administration - Allocated G & A
Contract Services
Supplies and Materials
General Expense
Facilities & Equipment Purchases.
Miscellaneous Capital Outlay
Rent - Facilities (CIS Training Facility)
Transfers from Capital Improvement Program Fund
Transfers to Capital Improvement Program Fund
Net Change in Water Fund
Rate Stablization
Net Change in Water Fund Reserve
Change
(24,586)
10,000
5,000
8,000
1,000
(828,000)
(122,000)
(4,114)
(4,114)
41,853
(46,000)
(55,200)
(1,018,161)
(18,047)
(1,000,114)
(1,018,161)
(17,930)
5,000
4,000
7,000
2,000
(41,000)
(5,486)
27,874
(59,800)
(78,342)
(78,342)
(78,342)
Page 2
Exhibit B
1998-99 Midyear Adjustments
Enterprise Funds
Activity Object
Fund Code Code Description ~ Change
Refuse Fund
25 551430 1401
25 000000 1898
25 551430 1970
25 000000 1601
25 551100 3001
25 551100 3099
25 551430 3001
25 551430 3099
25 551440 3001
25 551440 3099
25 210000 3402
25 000000 2041
ChangeinReserve
25 000000 3804
Landfill Disposal Fees
Other Miscellaneous Revenue
Landfil Charges to Other Depts
Investment Income
Regular Salaries
Benefits Allocation
Regular Salaries
Benefits Allocation
Regular Salaries
Benefits Allocation
Rent - Facilities (CIS Training Facility)
Transfers from Capital Improvement Program Fund
Net Change in Refuse Fund
Rate Stabilization
Net Change in Refuse Fund Reserve
500,000
229,000
(143,00Q)
230,000
42,500
7,500
42,500
7,500
42,500
7,500
(5,486)
4,337
964,851
964,851
,964,851
Wastewater Collection Fund
27 210000 3910 ’Utilities Administration - Allocated G & A
27 241260 3402 Rent - Facilities (CIS Training Facility)
27 000000 2041 Transfers from Capital Improvement Program Fund
27 000000 4041 Transfers to Capital Improvement Program Fund
Net Change in Wastewater Collection Fund
Changein Reserve
27 000000 3804 Rate Stabilization
Net Change in WW Collection Fund Reserve
(10,317)
(2,743)
15,579
(9,200)
(6,681)
(6,681)
(6,681)
Page 3
Activity Object
Fund Code Co’de
Wastewater Treatment Fund
26 000000 2041
Change in Reserve
26 000000 3804
Exhibit B
1998-99 Midyear Adjustments
Enterprise Funds
DescriptiQn Change
Transfers from Capital Improvement Program Fund
Net Change in Wastewater Treatment Fund
Rate Stabilization
Net Change in WW Treatment Fund Reserve
3,537
3,537
3,537
3,537
Storm Drainage Fund
28 581100 3001 Regular Salaries 90,336
28 581100 3004 Overtime Salaries 5,292
28 581100 3099 Benefits Allocation 45,854
28 581790 3001 Regular Salaries (90,336)
28 581790 3004 Overtime Salaries (5,292)
28 581790 3099 Benefits Allocation (45,854)
28 210000 3402 Rent - Facilities (CIS Training Facility)(1,097)
28 000000 2041 Transfers from Cap!t~ Improvement Program Fund 505
Net Change in Storm Drainage Fund
Change in Reserve
28 000000 3804 Rate Stabilization
Net Change in Storm Drainage Fund Reserve
(592)
(592)
(592)
Total Changes in Enterprise Funds 300,142
Page 4
Exhibit B
Electric Fund Summary
(000’s)
Revenues
Electric sales
Other revenues
Reappropriations / encumbrances
Total Revenues
Actual
FY 97-98
Adjusted
Budget
FY 98-99
Midyear
Projected
Budget
FY 98-99
76,703 66,853 66,853
10,296 10,964 10,596
4,352 5,931 5,931
Operating Expenses
Ptu’chases
Other expenses
Total operating expenses
Capital expenses
Total Expenses
Difference
0
(368)
0
To/(From) Reserves
’91,351 83,748 83,380 (368)
32,771 25,527 25,527
34,311 37,590 36,786
67,082 63,117 62,313
11,331 11,256 11,256
0
(804)
(804)
78,413 74,373 73,569 (804)
12,938 9,375 9,811 436
Reserves
Distribution Rate Stabilization
Supply Rate Stabilization
Calaveras
Public Benefit Program
Other Reserves
Total
8,120 6,671 6,774 103
14,560 11,429 11,429 0
55,583 70,917 71,073 156
1,533 1,533 1,710 177
4,991 3,511 3,511 0
84,787 94,061 94,497 436
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
Distribution Supply
RSR RSR
2,957 6,543
4,436 9,814
5,915 13,085
Revenues
Gas sales
Other revenues
Reappropriations
Total Revenues
encumbrances
Operating Expenses
Purchases
Other expenses
Total operating expenses
Capital expenses
Total Expenses
To/(From) Reserves
Reserves
Distribution Rate Stabilization
Supply Rate Stabilization
Other Reserves
Total
Exhibit B
Gas Fund Summary
(ooo’s)
Actual
FY 97-98
Adjusted
Budget
FY 98-99
Midyear
Projected
Budget
FY 98-99
18,229 15,210 15,210
1,912 1,745 1,787
1,866 1,772 " 1,772
22,007 18,727 18,769
Difference
0
42
42
9,719 9,375 10,325 950
7,302 8,055 8,165 110
17,021 17,430 18,490 1,060
4,636 3,488 3,488 0
21,657 20,918 21,978 1,060
350 (2,191) (3,209) (1,018)
7,889 7,494 7,476 (18)
8,544 6,690 5,690 (1,000)
683 715 715 0
17,116 14,899 13,881 (1,0t8)
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
Distribution Supply
RSR RSR
1,540 1,861
2,310 2,792
3,080 3,722
Pa~e 6
Exhibit B
Water Fund Summary
(000’s)
Actual
FY 97-98
Adjusted
Budget
FY 98-99
Midyear
Projected
Budget
FY 98-99
Revenues
Water sales
Other revenues
Reappropriations / encumbrances
Total Revenues
Operating Expenses
Purchases
Other expenses
Total operating expenses
Capital expenses
11,949
1,080
2,195
15,224
4,283
6,583
10,866
4,901
12,150
1,581
3,193
16,924
4,620
7,615
12,235
4,176
12,150
1,609
3,193
16,952
4,620
7,721
12,341
4,176
Difference
0
28
0
28
0
106
106
0
Total Expenses
,To/(From) Reserves
Reserves
Rate Stabilization
Other Reserves
Total
15,767
(543)
7,502
829
8,331
16,411
513
7,972
854
8,826
16,517
435
7,894
854
8,748
106
(78)
(78)
0
(78)
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
3,666
5,766
7,865
Page 7
Exhibit B
Refuse Fund Summary
(ooo’s)
Actual
FY 97-98
Adjusted
Budget
FY 98-99
Midyear
Projected
Budget
FY 98-99
Revenues
Customer revenues
Reappropriations / encumbrances
Total Revenues
22,324
881
23,205
21,565
2,356
23,921
22,385
2,356
24,741
Operating Expenses
Payments to PASCO
Other expenses
Total operating expenses
Capital expenses
6,854
13,997
20,851
2,150
7,380
15,438
22,818
2,068
7,380
15,293
22,673
2,068
Difference
820
0
820
0
(145)
(145)
0
Total Expenses
To/(From) Reserves
23,001
204
24,886
(965)
24,741 (145)
965
Reserves
Rate Stabilization
Water Resources Board
Total
5,972
59O
6,562
5,007
590
5,597
5,972
590
6,562
965
0
965
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
1,857
2,786
3,715
Page 8
Exhibit B
Wastewater Collection Fund Summary
(000’s)
Midyear
Adjusted Projected
Actual Budget Budget
FY 97-98 .FY 98-99 FY 98-99 Difference
Revenues
Customer revenues
Reappropriations / encumbrances
Total Revenues
10,450 10,319 10,335
5,513 8,331 8,331
15,963 18,650 18,666
16
0
16
Operating Expenses
Sewer treatment expenses
Other expenses
Total operating expenses
Capital expenses
4,158 4,340 4,340 0
2,435 2,901 2,923 22
6,593 7,241 7,263 22
10,393 10,004 10,004 0
Total Expenses 16,986 17,245 17,267 22
To/(From) Reserves (1,023) 1,405 1,399 (6)
Reserves
Rate Stabilization
Other Reserves
Total
7,407 8,785 8,779 (6)
388 404 404 0
7,795.9,189 9,183 (6)
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
2,526
3,789
5,052
Pag~e 9
Exhibit B
Wastewater Treatment Fund Summary
(O00’s)
Revenues
Treatment revenues
Reappropriations / encumbrances
Total Revenues
Midyear
Adjusted Projected
Actual Budget Budget
FY 97-98 FY 98-99 FY 98-99
11,870 12,561 12,565
2,984 3,468 3,468
14,854 16,029 16,033
Operating Expenses
Operating expenses
Total operating expenses
Capital expenses
11,823 12,478 ,12,478
11,823 12,478 12,478
2,538 3,950 3,950
Difference
4
0
4
o
o
o
Total Expenses 14,361 16,428 16,428 0
To/(From) Reserves 493 (399)(395)4
Reserves
Rate Stabilization
Other Reserves
Total
3,427 2,94Q ~,944
1,191 1,279 1,279
4,618 4,219 4,223
4
0
4
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
1,799
2,699
3,598
Pagd lO
Revenues
Customer revenues
Reappropriations / encumbrances
Total Revenues
Exhibit B
Storm Drainage Fund Summary
(O00’s)
Midyear
Adjusted Projected
Actual Budget Budget
FY 97-98 FY 98-99 FY 98-99 Difference
2,362 2,457 2,458 .1
3,903 2,664 2,664 0
Operating Expenses
Operating expenses
Total operating expenses
Capital expenses.
6,265 5,121 5,122
2,174 2,274 2,135 (139)
2,174 2,274 2,135 (139)
4,775 3,074 3,215 141
Total Expenses 6,949 5,348 5,350 2
To/(From) Reserves-(684)(227)(228)(1)
Reserves
Rate Stabilization
Total
520 293
520 293
292
292
(1)
(1)
FY 98-99 Approved RSR Levels
Minimum
Target
Maximum
N/A
N/A
N/A
Pag~ 11
EXHIBIT C
PROJECT DESCRIPTION
This project will renovate the third floor of the Civic Center and acquire modular work stations, making possible
the relocation of Utilities staff from the 8th floor and Mezzanine level in City Hall.
PROJECT JUSTIFICATION
Since February 1998, staffhas been working on a comprehensive space planning proposal to alleviate severe
overcrowding in City facilities. An inventory of available space was conducted and a deficit of approximately
21,000 square feet of office space was identified in the Civic Center tower complex. This deficit is being addressed
through a series of renovation and relocation projects. The renovation of the third floor and subsequent
consolidation of the Utilities staff is the third phase of the efforts to relieve the overcrowded conditions in the Civic
Center. As part of the renovations, modifications will be made which will upgrade the facility, including electrical
work, new energy-efficient light fixtures, modifications to the HVAC and life safety systems, asbestos removal,
replacement of ceiling tile, and new carpeting.
FUTURE FINANCIAL REQUIREMENTS
FISCAL YEAR AMOUNT
PY Budget
1998-99 $460,000
1999-00
2000-01
2001-02
2002-03
Sources of Funding: Utilities Funds
COMPONENTS
Construction, including demolition and rebuilding of walls, electrical
modifications and lighting improvements, ceiling tile replacement, fire
sprinkler modifications, carpet replacement, painting, and HVAC modi-
fications ($240,000). The remainder of the funding is for acquisition of
furniture and moving costs.
IMPACT AND SUPPORT ANALYSIS
¯Environmental:Categorically exempt under Section 15301 of CEQA, minor change to existing facil-
ities.
Design Elements:None.
Operating:None.
Telecommunications:None.
COMPREHENSIVE PLAN
The Comprehensive Plan contains no policies or programs directly related to this project.
EXHIBIT D
P
PROJECT DESCRIPTION
This project provides improvements to the storm drainage system as ~dentified in the Storm Drainag~ Master Plan
and Condition Assessment Studies completed in 1993. The Master Plan identified projects needed to augment the
capacity of the existing storm drainage system to handle projected 10-year storm events. The Condition
Assessment identified portions of the storm drainage system that need to be replaced or rehabilitated due to their
deteriorated condition.
Revenue bonds were issued to fund proposed improvement projects through 1997-98. The funding in 1998-99 is
for salaries for staff to continue to work on previously funded portions of the project.
A new bond issuance would be requi.red to finance projects through 2001. However, voter enactment of Proposition
218, the "Right to Vote on Taxes Act," may affect the Storm Drainage Funds ability to finance capital and operating
costs.
PROJECT JUSTIFICATION
Provides needed system improvements, expansion, repair/replacement, and erosion control to enhance aging
infrastructure and augment system capacity to minimize citywide flooding.
FUTURE FINANCIAL REQUIREMENTS
FISCAL YEAR AMOUNT
PY Budget Ongoing
1998-99 $141,482
1999-00
2000-01
2001-02
2002-03
TBD
TBD
COMPONENTS
Funding for salaries for staff to continue to support previously funded
work.
Sources of Funding: Debt Financing
IMPACT AND SUPPORT ANALYSIS
Environmental:None.
Design Elements:None.
Operating:None.
Telecommunications:None.
COMPREHENSIVE PLAN
This project furthers or implements Policy 14 of the Environmental Resources Element relating to measures to
reduce risk to human life and property.
EXHIBIT E
Update to Table of Organization
City Manager
1998-99
1997-98 Adopted’
Actuals Budget
Administrative Secretary - Confidential 1.00 1.00
Assistant City Manager 1.00 1.00
City Manager 1.00 1.00
Deputy City Manager - Special Projects 1.00 1.00
Manager, Economic Resources 1.00 1.00
Executive Secretary - Confidential (*)2.00 2.00
Management Assistant 1.00 1.00
Office Specialist 1.00 1.00
Public Communication .Officer (**)0.00 0.50
Senior Executive Assistant 1.00 1.00
TOTALS 10.00 10.50
Changes
0.50
0.50
1998-99
Midyear
Budget
1.00
1.00
1.00
1.00
1.00
2.00
’1.00
1.50
0.50
1.00
11.00
*This position reflects a temporary increase which will be removed in the 1999-00 budget.
**This position was transferred from the City Clerk’s to the City Manager’s Office to consolidate the
public information function in a single office.
Attachment 3
Budget Amendment Ordinances Impacting General Fund Reserves Approved To Date in 1998-99
Estimated Beginning Budget Stabilization Reserve (BSR)
Balance
Net Cost
Placeholders Impact on the
Already in the 1998- General Fund
99 Adopted Budget BSR
$19,050,000
Estimated
Future Year
Ongoing Costs
Reduction in Rental Income from Utilities Due to Relocation of
Utilities Engineering and Creation of Capital Improvement
Project 19921, Relocation / Consolidation of Level A Storage
Increase in the City’s Annual Rental Payment to the Palo Alto
Unified School District for Lease and Covenant Not to Develop
for an Extended Day Care Center at the New Hoover School
Site
Salary and Benefit Increases Retroactive to May 1, 1998 for
Classified Personnel (SEIU) *
Salary and Benefit Increase Rela’oaetive to July I, 1998 for
Police Personnel
Addition of Five Full-Time Positions and Associated
Resources to the Planning and Community Environment
Department
Interim Historic Inventory Consultant
Interim Historic Regulations Administration
Phase 1 - San Francisquito Creek Bank Stabilization and
Revegitation Study
Reclassification of CDBG Position to Senior Planner Position
Acquire Leased Space and Cover Associated Support C.osts for
a One-Stop Development Center at 285 Hamilton Avenue
Recruitment Assistance
Formation of Library Advisory Commission
Golf Course Clubhouse and Related Improvements
Salary and Benefit Increases Retroactive to July 1, 1998 for
Management and Confidential Employees
Emergency Repairs (Basements, Creek, Arastradero Pres.)
Council Chambers Refurbishing Capital Project Number 19625
Emergency Management Plan Implementation
Automatic Public Toilets
($231,700)($231,700)($221,000)
($34,792)($34,792)($36,000)
($260,000)($260,000)($702,000)
($182,200)($182~00)($265,000)
($488,364)$300,000 ($188,364)($410,743)
($437,400)($437,400)
($269,600)($269,600)
($112,500)($112,500)
¯ ($7,400)($7,400)
($506,979)($506,979)($370,000)
($60,000)($60,000)
($22,500)($22,500)
$33,430 $33,430 ($t4,280)
($334,000)($334,000)($624,900)
($142,895)($142,895)
($238,000)($238,000)
($308,500)$200,000 ($108,500)$294,000
($106,000)($106,000)$140,000
Total ($3,709,400)$500,000 (S3,209,400) ($2,209,923)
BSR Balance After BAO’s $~84o,6oo