HomeMy WebLinkAboutStaff Report 1274City of Palo Alto (ID # 1274)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 2/7/2011
February 07, 2011 Page 1 of 2
(ID # 1274)
Title: Ordinance Close of Budget 2010 & Approve CAFR
Subject: Finance Committee Recommendation to Adopt an Ordinance
Authorizing the Closing of the Budget for the 2010 Fiscal Year; Approval of 2010
Comprehensive Annual Financial Report (CAFR)
From: City Manager
Lead Department: Administrative Services
RECOMMENDATION
The Finance Committee and Staff recommend that Council adopt the attached Ordinance
authorizing closing of the Budget for the Fiscal Year ending June 30, 2010 and authorize re-
appropriation of 2010 funds into the 2011 budget; close completed capital improvement
projects; and transfer remaining Capital Improvement Project balances to the appropriate
reserves. Attachment A (CMR 453:10) includes an overview of the City’s financial condition. In
addition, the Finance Committee recommended approval of the City’s 2010 Comprehensive
Annual Financial Report (CAFR) (Attachment B to CMR 453:10; electronic copy available at
www.cityofpaloalto.org/depts/asd/financial_reporting.asp and hard copies are available at the
Administrative Services Office upon request).
BACKGROUND
As customary, the City Council is required to close out its financials each fiscal year. At its
December 21, 2010 meeting, the Finance Committee unanimously approved the closing of the
2010 fiscal year.
ATTACHMENTS:
Attachment A:CMR:453:10 Recommendation Regarding Adoption of Ordinance Authorizing
Closing of the Budget for the FY Ending June 30, 2010, Including Reappropriation Requests,
Closing Completed Cap (PDF)
Attachment B: Excerpt Minutes from the Finance Committee meeting of December 21, 2010
(PDF)
Prepared By:Trudy Eikenberry, Manager of Accounting
February 07, 2011 Page 2 of 2
(ID # 1274)
Department Head:Lalo Perez, Director
City Manager Approval: James Keene, City Manager
TO: HONOUABLE CITY COUNCIl,
ATTENTION: FINANCE COMMITTEE
FROM: CITY MANAGER
DATE: DECEMBER 21, 2010
REPORT TYPE: ACTION
DEP ARTMENT: ADMINISTUA TIVE
SERVICES
CMR: 453:10
SUBJECf: Recommendation Regarding Adoption of Ordinance Authorizing
Closing of the Budget for the Fiscal Year Ending Junc 30, 2010,
Including Reappropriation Requests, Closing Completed Capital
Improvement Projects, Authorizing Transfers to Reserves and
Approval of Comprehensive Annual Financial Report (CAFR)
RECOMMF~NDATION
Staff recommends that the Finance Committee review, provide input, and forward the attuched
ordinance (Attachment A) und associated exhibits to the City Council for its approval to: close
the Fiscal Year (FY) 20 10 Budget; authorize re-appropriation of FY 20 I 0 funds into the FY
20 II Budget (Exhibits A & B); close completed capital improvement projects (Exhibit C); and
transfer remaining balances to the appropriate reserves (Table I for General Fund and Exhibits E
& F for Enterprise Funds), In addition, staff recommends the Finance Committee review and
forward to the City Council for its approval the City'S Comprehensive Annual Financial Report
(CAFR) (Attachment B),
BACKGROUND
At the conclusion of each fiscal year (July-June) the City must close the financial system for the
year and produce year-end financial reports, The reports along with financial data are reviewed
by Maze & Associates, an audit firm hired by the City Auditor. Maze & Associates, produces a
written assessment of the C'ity's year-end fiscal condition and this, together with other financial
information, are what form the City's Comprehensive Annual Financial Report.
For FY 2010 staff gave the Finance Committee a high-level, preliminary FY 2010 year-end
update of fiscal condition on October 5, 2010 (Attachment C CMR: 369: 10). There are no major
differences between the preliminary report and this report.
CMR:45J:IO Puge I 0[11
The attachments to this report provide the necessary documents for closing the FY 2010 Budget
and reauthorizing FY 2010 funds for the current FY 2011. In addition, they provide detailed
information on the City's financial activities for FY 2010. This CMR highlights key liscal issues
affecting the City of Palo Alto. The Management Discussion and Analysis (MD&A) chapter of
the CAFR (Attachment B) also provides a discussion and analysis of the City's current fiscal
health and includes financial statements, and performance information that is compared to the
prior year, and capital asset and debt administration data.
DISCUSSION
Economy
Like other cities throughout the country, the "Great Recession" adversely affected the City's
General Fund resources. High wlemployment, the housing crisis, and low consumer spending
have hit City revenues hard. Although there are preliminary signs of stabilization in some
revenue categories such as transient occupancy taxes, the City continues to face declines or
uncertain revenue streams in its property, sales, and property transfer tax receipts. Challenges on
the expense side include: rising pension and medical costs; a signilicant retiree medical liability;
and a substantial infrastructure backlog. The City continues to be proactive as it struggles to
align revenues and expenses through service and program cuts, revenue enhancements, and
reducing expenditures through employee compensation and benefit changes. In 2010, the City's
General Fund reduced scrvices, deleted full-time positions, pared bcncf.its and drew modestly on
reserves to balance its budget. For FY 2011, the City c10seda $7.3 million GF budget gap. At
the end ofFY 2010, the City had $27.4 million or 19.7 percent orits budgeted expenditures and
operating transfers for FY 20 II, in its General Flmd Budget Stabilization Reserve. A detailed
discussion of the economy and FY 2010 revenues also is included in the CAFR MD&A page 3-
4. In addition, staff will present the 10 year Long Range Financial Forecast to the Finance
Committee in February 20 II.
Results by Fund
General Fund
The final FY 2010 result for the General Fund is a net loss of$1.8 million, which represents the
difference between revenues and expenditures for one liscal year. The difference between
revenues and expenditures, either a gain or loss changes the Budget Stabilization Reserve (BSR),
a component of the fund balance. FY 2010 revenues were $4 million less than prior year
primarily from reduced sales tax revenue. Other financial transactions impact a fund's balance
sheet, which report the fund's assets, liabilities and fund balance. The General Fund balance
consists of a number of reserves; the BSR, encumbrances, notes and loans, inventory, and
prepaid items, uruealized gain on investment, and reappropriations. The $1.8 million loss, results
in a draw on the BSR. In addition to the $1.8 million draw on the BSR, the BSR balance will
increase ot' decrease as the balances in the other reserves change. The net effect of the draw on
the BSR of $1.8 million and transfers in from other l'eserves 0£$4.4 million is an increase of$2.6
million resulting in an ending BSR balance of $27.4 million or 19.7 percent of budgeted
expenditures and operating transfers for FY 20 II. This percentage is within the Council
approved guidelines of 15 to 20 percent of budgeted expenditures.
CMR: 453:10 P.ge2 of II
At fiscal yearend, the fund balance for the General Fund totaled $41.5 million. This IS
comprised of reserves for:
Table 1
GENERAL FUND RESERVE SUMMARY ($OOOs)
FISCAL YEAR 2010
Receivable Reserve
IStr>r"~ Inventory Reserve
I Pn90aid Reserve
JnrElali;ted Investment Gain/Loss Reserve
IReserl,e For Equity Transfer Stablization
I~trrl"nt for Stores On"r~,tinr'~
CMR: 453:10
Balance
24,747
1,528
3,173
1,775
2,441
3,636
Net From
2,649
(98)
488
(285)
1,076
(3,636)
Balance
06/30/10
27,396
1,430
3,661
1,490
3,517
o
Page30fll
The following graph provides a snapshot of the General Fund BSR balance and percentage of
budgeted expenditures for the last ten years:
Graph 1 -------------------------------------------------
General Fund BSR & Percent of Budgeted
Expenditures FY 2001-2010
(in millions)
$30r-------------------------------------------------------------------------------,
$26
$20
$15
$10
$5
2001 2002 2003 2004 2005 2006
Fiscal Year
2007 2008 2009 2010 l $0
-------------------------------------------------------------
CMR: 453:10 Page40fll
The following graph provides a five-year comparison of major General Fuhd tax revenues,
Graph 2
Major General Fund Tax Revenues Fiscal Years 2006-2010
(in thousands)
$31,000 1---------".--".-------------
$26,000
$21,000
$16,000
$11,000 .
$6,000
$1,000
CMR: 453:10 Page 5 of 11
The following graph provides a five-year comparison of General Fund department expenditures,
3
$35,000 .
General Fund Department Expenditures Rscal Years 2006-2010
(in thousands)
$30,000 I~~····~ .. -~~·~·· .. ·~
$25,000
$13.243
$1.3.469
$13.405
I I
(I) FY 2009 postponed a budgeted $4.8 million transfer to the Teehnology Fund. This one-lime deferral was the General
Fund share of technology cosl Bllocations and it will be addl'csr;cd in tl four year funding plan for till departments except
Fire. FY 2010 Fire Department expenditures Include $1.2 million cost alloe.lions to the Technology Fund tbr FY 2009.
Details of the Genera{ Fund are discussed in the MD&A pp. 15-19.
The FY 2010 yearend Budget Amendment Ordinance (BAO) includes transfers of
unencumbered appropriation balances between General Fund Departments, These reallocations
(I) distribute non-departmental offsetting expense for the achieved $1.5 million in salary and
benefit savings that resulted from the SEW contract imposed in October 2009; (2) distribute $1.7
million in attrition savings that was adopted in the midyear budget (CMR 150:10); (3) and
reallocate remaining unencumbered appropriations to various departments that fell short after (I)
and (2) were complete. '{be table below depicts a before and after view of these General Fund
adjustments. Details of these reallocations can be found ill the Detailed Changes to the Adjusted
Budget (Attachment A, Exhibit A).
CMR; 453:10 Page 6 of t I
Table 2
General Fund Reallocation of Unencumbered Appropriations
(in thousands)
Budset
Remaining
BeforeAdj Chanse After Ad) Actual Budllet
City Attorney $3,383 ($127) $3,256 $3,216 $40
City Auditor 1,095 (20) 1,075 1,057 18
City Clerk 1,608 (65) 1,543 1,474 69
City Council 335 335 319 16
City Manager 2,654 (268) 2,386 2,327 59
Administrative Services 8,859 (807) 8,052 8,048 4
Community Services 22,216 (1,265) 20,951 20,846 105
Fire 26,621 1,576 28,197 28,180 17
Human Resources 2,906 (79) 2,827 2,778 49
Library 6,649 107 6,756 6,623 133
Planning 10,457 (336) 10,121 10,058 63
Police 30,219 (1,066) 29,153 29,090 63
Public Works 14,018 (523) 13,495 13,405 90
Non-Departmental 5,935 2,873 8,808 8,798 10
Transfers out 14,565 14,565 14,637 (72)
Total $151,520 $0 $151,520 $150,856 $664
Capital Projects Fund
For FY 2010, the Capital Projects Fund reported $25.9 million in expenditures and odler uses, an
increase of $1.9 million from prior year. This level of expenditures is consistent with the City's
effort to rehabilitate and maintain its existing infrastructure. The Capital Projects Fund balance
totaled $83.8 million, an increase of $47.8 million. This increase is primarily from receipt of
funds from General Obligation Bonds, issued in June 20 I O. The bond proceeds will finance costs
for constructing a new Mitchell Park Library and Community Center, as well as improvements to
the Main Library and the Downtown Library. The City is proud to report that it received an
AAA credit rating from Standard and Poor's and Moody's. The true interest cost on these bonds
was 4.2 percent, which is 1.22 percent lower than originally projected ip 2008 and is an
indication of how well the bonds were received in the market. As of June 30, 20 I 0, the
Infrastructure Reserve (lR) balance was $8.6 million, an increase of $1.6 million from prior year.
The Encumbrance Reserve is $5.9 million, $5.4 million Icss than the prior year. Reappropriation
Reserve balance decreased by $2.5 million from prior year Ibr a total of $15.2 million. A new
reserve, Library Bond Project, has a balance of $53.5 million that represents the unused portion
of bond proceeds. Bond proceeds are maintained by a fiscal agent and the Library Oversight
Committee makes quarterly presentations to the City Council. A number of completed and
closed projects with remaining balances at the end of FY 2010 totaling $108 thousand have been
returned to the Infrastructure Reserve. This provides an additional source of revenues to the IR.
CMR: 453:10 Page70fll
Overall, the following summarizes changes to the City's General and Capital Fund reserves:
• The General Fund BSR is 19.7 percent of budgeted expenditurcs and operating transfers
for FY 20 II. This percentage is within the Council approved guidelines of 15 to 20
percent and shows a closing balance of $27.4 million, an increase of $2.6 million from
the prior year.
• Budget transactions included in the attached ordinance decreased General Fund reserves
by $7 thousand.
• The Infrastructure Reserve has a final balance of $8.6 million at the end of FY 20 I O.
Since there is an infrastructure backlog and need totaling over $500 million, additional steps
will be needed to address infrastructure needs in the near future.
Enterprise Funds:
The Rate Stabilization Reserves (RSR) for the combined Enterprise Funds increased by a net of
$28.7 million for an ending balance of $87.9 million. Major changes include an $11.6 million
increase in the Water Fund, $6.6 million increase in the Electric Fund, and $5.4 million increase
in the Gus Fund. Exhibit F provides the balance changes for all reserve categories for the
Enterprise Funds. The City faces ongoing fiscal challenges in the Refuse Fund and they are
discussed further in the repoli. At the end of FY 20 I 0, a number of Enterprise Fund CIP proj ects
were completed and closed (ExhibiLC). The remaining balanceLof these projects reverted to
their respective reserves.
Waler Fund
The Water Fund ended the year with a net income of $7 million, an increase of $2.1 million from
the prior year. At fiscal yearend, unrestricted net assets for the Water Fund totaled $28.7 million,
which include $17.0 miJlion for RSR. The Water Fund also has restricted cash and investments
of $27.9 million for the Emergency Water Supply project, funded by a bond issuance.
Electric Fund
For FY 2010 the Electric Fund had a net income of $9.4 million compared to a net loss of $7.2
million in the prior year. The increase is mainly due to lower utility purchase cost of $11.8
million. The RSR balance is $54.3 million an increase of$6.6 million from the prior year.
Gas Fund
The Gas Fund ended the year with a net income of $7.9 million, a decrease of $2.6 million from
prior year. The decrease is primarily due to aiD percent rate decrease effective July I, 2009 and
an increase in other linancing activities of $2.2 million. Tbe RSR has an ending balance of$18.5
million, an increase of $5.4 million from the prior year.
Fiber Optics Fund
'The Fiber Optics Fund had a net income of $2.1 million, a decrease of $300 thousand from the
prior year. 'The ending RS R is $8.3 million an increase of $1.9 miUion from prior year.
CMR: 453:10 Page8o!'l)
Wastewater Collection Fund
The Wastewater Collection Fund had a net income of $4.7 million compared to a net loss of $63
thousand in the prior year. 'Ille RSR ended the year with a balance of $6,8 million, compared to
$6 million for the prior year.
Wastewater Treatment Fund
Wastewater Treatment Fund ended the year with a net loss of $1.2 million compared to a net loss
of $3,2 million in FY 2009. The net loss is a draw on the RSR, resulting in a negative balance of
$12.4 million, compared to a negative $15,6 million for the prior year. A t fiscal yearend,
unrestricted net assets for the Wastewater Treatment Fund totaled $11.8 million. This was
comprised of reserves for:
Table 3
Rate Stabilization Reserve ($12.4) million
Reappropriations -Disinfection Facility Improvement Program $14,6 million
Reappropriations.-other projects $2.6 million
Emergency plant replacement $2.1 million
Commitments $4.9 million
The negative RSR balance is due to required accounting reserves of $14.6 million for the $20.3
million Disinfection Facility Improvement Program. As the Disinfection Facility Improvement
Program progresses, the City will be reimbursed with grant and partner revenue and the RSR will
move toward a positive position.
Refuse Fund
For FY 20 I 0 the Refuse Fund had a net loss of $2.7 million, resulting in a draw on the RSR. The
prior year had a net loss of $5.4 million. FY 2010 saw a decrease in disposal fee income of $1.1
million, and increased refuse collection costs. The prior year included $3.1 million of additional
costs due to an updated forecasted clo~ure costs lor the landfill. The ending balance of the RSR
as of June 30, 2010 is a negative $4.9 million compared to the prior year negative balance of
$2.1 million, 111e June 30, 2010 cash balance is $8 million, which satisties the State requirement
of $6.7 million for post-closure liabilities. Council and stalf are working together to implement
changes to the operations and rate structure to bring the Refuse Fund to a positive reserve
position and to maintain the required cash position to satisfy the State requirement and ongoing
operations.
Storm Drainage Fund
The Storm Drainage Fund ended the year with a net income of $2.5 million, a decrease of $900
thousand from the prior year. The RSR had an ending balance of a positive $286 thousand
compared to a negative $1.1 million in the prior year.
CMR: 453;10 rage 9 01' 1 J
General Benefits and Insurance Internal Service Funds
As requested by the Finance Committee in Dec. 2009, the FY 2010 CAFR presents the General
Benefits Fund, Workers' Compensation Insurance Program, and General Liabilities Insurance
Program as separate funds. Prior to FY 20 I 0, these funds were reported as the General Benefits
and Insurance Fund.
Retiree Medical Fund and Trust Fund
For FY 20 I 0 the City's annual required contribution (ARC) for retiree medical costs is $9.8
million. During FY 2010, the City made direct contributions to CalPERS of $5.5 million in
current year retiree premiums, which covered 795 retirees. The City also contributed $1.7 million
during FY 2010 toward the California Employers' Retirees Benefit Trust (CERBT), and $1.8
million in early FY 2011 which was accrued for in FY 2010. As ofJune 30, 2010 the balance of
the trust, including the contribution made in August 2010 since it relates to the FY 2010 ARC, is
$34 million. The balance as of Sept. 30, 2010 reflects improvements in investment earnings.
Total contributions from inception of the trust are $38.1 million, investments loss is $188
thousand and administrative cost is $65 thousand for an ending balance as of Sept. 30, 2010 of
$37.8 million. The retiree medical liability per the January I, 2009 actuarial valuation was
$129.7 million, less the value of the trust, $37.8 million, and direct contributions to CalPERS of
$5.5 million leaves a net liability of $86.4 million. The next actuarial valuation of January I,
20 II will be presented to Council in early summer 20 II.
RESOURCE IMP ACT
Adoption of the attached budget-closing ordinance (Attachment A) allows for the re-
appropriation and carryover of funding from the FY 20 I 0 budget so that specific operating
programs and capital projects can be completed in the current fiscal year (Exhibit B). In addition,
by closing completed capital improvement projects, balances (Exhibit C) are returned to the
original funding source for future appropriation. Exhibits D and E summarize financial results
for the General Fund and Enterprise Funds, respectively, by providing an analysis of the
performance of these funds in comparison to the budget as adopted and adjusted by Council.
Exhibit E reflects the changes to and status of major reserves.
POLICY IMPLICATIONS
This recommendation is consistent with existing City policies.
ENVIRONMENTAL REVIEW
The action recommended is not a project for the purposes of the California Environmental
Quality Act.
PREPARED BY: J~ <7~ TRUD EIKENBERRY
Accounting Manager, Administrative Services
CMR: 453:10 Page 100fll
DEPARTMENT HEAD APPROVAL:
LALOP
Director, Administrative Services
CITY MANAGER APPROVAL:
ATIACHMENTS
Attachment A: Budget Closing Ordinance
Exhibit A -Detailed Changes to the Adjusted Budget
Exhibit B -Fiscal Year 2009 Re-Appropriation Requests
Exhibit C -Capital Improvement Projects Completed and Closed in FY 2010
Exhibit D -.. General Fund Summary
Exhibit E -Enterprise Summaries
Exhibit F -Enterprise Reserve Summary
Attachmcnt B: CAFR
Attachment C: CMR: 369: I 0 Fiscal Year 2010 Financial Update as of June 30, 2010
CMR: 453:10 Pogellofll
ATTACHMENT A
ORDINANCE NO. xxxx
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AUTHORIZING CLOSING OF THE BUDGET FOR THE
FISCAL YEAR ENDING JUNE 30, 2010
The Council of the City of Palo Alto does ordain as
follows:
SECTION 1. The Council of the City of Palo Alto finds
and determines as follows:
A. Pursuant to the provisions of Section 12 of Article
III of the Charter of the City of Palo Alto and as set
forth in Section 2.28.070 of the Palo Alto Municipal Code,
the Council on June 15, 2009 did adopt a budget for fiscal
year 2010; and
B. Fiscal year 2010 has ended and the financial
results, although subject to post-audit adjustment, are now
available and are herewith reported in summarized financial
Exhibits "A", "B" I "CII I "DII, "Elf, \\F" I and "GO prepared by
the Director, Administrative Services, which are .attached
hereto, and by reference made a part hereof.
SECTION 2. Pursuant to Section 2.28.080 of the Palo
Alto Municipal Code, the City Manager during fiscal year
2010 did amend the budgetarY accounts of the City of palo
Alto to reflect:
A. Additional appropriations authorized by ordinance
of the City Council.
B. Amendments to employee compensation plans adopted
by the City council.
C. Transfers of appropriations from the contingent
account as authorized by the City Manager.
D. Redistribution of appropriations between
divisions, cost centers, and obj ects within various
departments as authorized by the City Manager.
E. Fiscal Year 2010 appropriations which on July 1,
2009 were encumbered by properly executed, but uncompleted,
purchase orders or contracts.
Page lof 5
ATTACHMENT A
SECTION 3. The Council hereby approves adjustments
to the fiscal year 2010 budget for Fund Balancing Entries
as shown on attached Exhibit" "Au.
SECTION 4. The Council hereby re-appropriates
fiscal year 2010 appropriations in certain departments and
categories, as shown on the at tached Exhibit "B", which
were not encumbered by purchase order or contract, at year
end into the fiscal year 2011 budget.
!
SECTION 5. The fiscal year 2010 encumbered
balances for the departments and categories shown on
Exhibit "D" shall be carried forward and re-appropriated to
those same departments and categories in the fiscal year
2011 budget.
SECTION 6.
directed:
The City Manager is authorized and
A. To close the fiscal year 2010 budget accounts in
all funds and departments and, as required by the Charter
of the City of Palo Alto, to make such interdepartmental
transfers in the ,2010 budget as adopted or amended by
ordinance of the Council; and
B. To close various completed Capital Improvement
Projects (CIP) as shown in "Exhibit "CN and move all
completed CIP to their respective reserve funds indicated
in Exhibit "Gil; and
C. To establish reserves as shown, in Exhibits "E",
"F" and "G" for all Funds as necessary to provide for:
(1) A reserve for encumbrances and re-
appropriations in the various funds, the
purpose of which is to carry forward into
the fiscal year 2011 bUdget and continue, in
effect, the unexpended balance of
appropriations for fiscal year 2010
departmental expenditures as shown in
Exhibits "E" and "F"; and
(2 ) Reserves for Advances to
Stores Inventory, and other
accordance with ordinance
guidelines as shown in Exhibit
Page 2 of 5
Other Funds,
reserves in
and policy
"Etlr and
--_ ....... _-
ATTACHMENT A
(3) A reserve for general contingencies of such
amount that the City Council has approved;
and
(4 ) Reserves for utilities plant
other rate stabilization, and
accordance with Charter
guidelines as shown Exhibit "G U •
replacement,
reserves in
and policy
D. To fund the Budget Stabilization Reserve in
accordance with the General Fund Reserves Policy adopted by
the City Council.
SECTION 7. The Public Services Donation Fund is
hereby decreased by Twenty Two Thousand Three Hundred Seven
Dollars ($22,307) as described in Exhibit "AU. This
transaction will change the Public Services Donation Fund
Balance to $784,320.
SECTION 8. The Child Care Fund is hereby decreased by
Seven Thousand Two Hundred Eighty One Dollars ($7,281) as
described in Exhibit "Au. This transaction will change the
Child Care Fund Balance to $328,987.
SECTION 9. The Street Improvement Fund is hereby
decreased by Five Hundred Sixty Four Thousand Six Hundred
Twenty Eight Dollars ($564,628) as described in Exhibit
"Au. This transaction will change the Street Improvement
Fund Balance to $530,000.
SECTION 10. The Uni versi ty Avenue Parking Permit
Fund is hereby decreased by One Hundred Six Thousand Six
Hundred Forty Eight Dollars ($106,648) as described in
Exhibit "AU. This transaction will change the University
Avenue Parking Permit Fund Balance to $608,202.
SECTION 11. The California Avenue Parking Permit
Fund is hereby decreased by Ten Thousand Three Hundred
Seventy Three Dollars ($10,373) as described in Exhibit
"AU. This transaction will change the California Avenue
parking Permit Fund to $336,344.
SECTION 12. The College Terrace Parking Permit Fund
is hereby decreased by Three Thousand Three Hundred Sixty
Seven Dollars ($3,367) as described in Exhibit "Au. This
transaction will change the College Terrace Parking Permit
Page 3 of 5
ATTACHMENT A
Fund to $51,694.
SECTION 13. The Local Law Enforcement Block Grant
Fund is hereby decreased by Fifty Two Thousand Seven
Hundred Twenty Eight Dollars ($52,728) as described in
Exhibit "Au. This transaction will change the Local Law
Enforcement Block Grant Fund Balance to $180,213.
SECTION 14. The Recovery Act JAG Fund is hereby
decreased by Eight Thousand Eight Hundred Twenty Dollars
($8,820) as described in Exhibit "Au. This transaction will
change the Recovery Act JAG Fund Balance to $15,650.
SECTION 15. The Capital project Fund is hereby
increased by the sum of Nine Hundred Ninety Two Thousand
Five Hundred Forty Two Dollars ($,992,542) as described in
Exhibit "A". This transaction will increase the
Infrastructure Reserve Balance to $8,648,354.
SECTION 16. The Electric Distribution Rate
Stabilization Reserve is hereby increased by the sum of One
Million Four Hundred Seventy Eight Thousand Eleven Dollars
($1,478,011) as described in Exhibit "A". This transaction
will change the Electric Distribution Rate Stabilization
Reserve to $9,484,000.
SECTION 17. The Gas Distribution Rate Stabilization
Reserve is hereby increased by the sum of Forty Four
Thousand Six Hundred Twenty Dollars ($44,620) as described
in Exhibit "AU. This transaction will change the Gas
Distribution Rate Stabilization Reserve to $6,209,000.
SECTION 18. The Water Rate Stabilization Reserve is
hereby increased by the sum of Twenty Four Thousand Seven
Hundred Six Dollars ($24,706) as described in Exhibit "Au.
This transaction will change the Water Rate Stabilization
Reserve to $17,036,000.
SECTION 19. The Refuse Rate Stabilization Reserve is
hereby increased by the sum of One Hundred Seventy Eight
Thousand Seven Hundred Seventy Dollars ($178,770) as
described in Exhibit "Au. This transaction will change the
Refuse Rate Stabilization Reserve to negative $4,935,000.
SECTION 20. Upon completion of the independent audit,
detailed financial statements reflecting the changes made
by the Sections 7 through 18 of this ordinance shall be
Page 4 of 5
ATTACHMENT A
published as part of the annual financial report of the
City as required by Article III, Section 16, of the Charter
of the city of Palo Alto and in accordance with generally
accepted accounting principles.
SECTION 21. 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.
SECT~gl:'l 22. The Counc il of the Ci ty of Palo Alto
hereby finds that the enactment of this ordinance is not a
project under the California Environmental Quality Act and,
therefore, no environmental impact assessment is necessary.
SECTION 23. As provided in
Palo Alto Municipal Code, this
effective upon adoption.
Section 2.04.330 of the
ordinance shall become
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:
City Clerk
APPROVED AS TO FORM;
City Attorney
Mayor
APPROVED;
City Manager
Director of Administrative
Services
Page 5 of 5
GENERAL FUND
CIIy _mey
city Auditor'
Use Cnl;!ngas
CIIyCler'
Use Changes
Citty Manager
Use Changes
Adrnlnlatratlve Services
Uille Changes
Community Servicea
U.e Changes
Fire
Use CIlangas
Human SsrvIeu
Llbr"'l'
I!KHIBIT A
CITY OF PALO At TO
FISCAL YEAR ENDING JUNE 30, 1010 I!UDGET SUMMARY
DETAil CHANGES TO TfiE ADJUSTED BUDGET
Commitment
llom
F¥ 2010
VeBrEndAd
NOll SalalY (55.126) R~allocarlolllo Firs
SoIaJ)< __ -;:(~7",I,~a~60~) MIoy .. r Vacancy S ... ng.
!121,(l14)
Non SBlary (1S.ZiO-) Realfocetion 10 Fire:
Solary (15,3311 Imp""od SEIU Terms
S.IOry __ -,(!;:3~O,,,,OI,,,i~) Midy •• r V.cancy S."ng.
(&5,1661
Non SalsfY (87 ,625) R~alloca1jon to flrl;)
Salary (1 SE1U Term.
sajary::::::::::::j~~~Mj,jyaar "ac,""y Savings
Non Salary (609,529) Reallocation \0 Fire/Library
Salary (90,700) Impo.od SEIU Term.
Salary __ -,:1'(9,,8;:;,S;;I:;:3f.) MldyearVscancy Savings
(&06,742)
Non Solary
Sa'ary
Sa'iJry
(IS8,38S) Re.lI.callon to Fir.
(376,621» lmpo.odSEIU Term,
... J!2.o,?~l.. Mldy •• r Vacancy S"'ngs
(1,265,1.9.6).
Salary 64,266 ReaUocelion from PoI1c6
Oeserl tion
Salary 1,53-1,514 Raa\\ocatlon from varlooe: departmenls
SalaJ)< __ -;-:1!:;1;;9'C;34",O:c1 Imposed SE'U Term.
1,1i18,46il
SswI)' 318,571 H€HiIloonllo!1 from Polica B!1d ASO
S.'.ry (lee,SIS) lmp"""d SEIU Term_
Salary __ ----:("'45?,~26;;;3;CJ Midyolll V_nov SaYing_
1D5r393
Pltlflfllfl9 and Community environment
Salary
NonSa!ary
5.1"",
192,357 Remlocalionlrom Poli::e
(20,000) Reallocationlo FJre.
(229,150) lmpoeod SEIU T arm.
5.1''' __ ~ fI.'fidygar Vacanc)' Savirtgs
F'agc1of4 12/14/2010
Fund
Police
Use Changes
Public Works
Use Changes
Non Departmental
Use Changes
Net Changes To (From) Reeervee
Fund Balancing Entries
Public Services Donations Fund
Use Changes
Net Changes To (From) Reserves
Fund Balancing Entries
Child Care Fund
I
Use Changes
Net Changes To (From) Reserves
Fund Balancing Entries
CAPITAL PROJECT FUND
Source Changes
Use Changes
Net Changes To (From) Reserves
EXHIBIT A
CITY OF PALO ALTO
FISCAL YEAR ENDING JUNE 30, 2010 BUDGET SUMMARY
DETAIL CHANGES TO THE ADJUSTED BUDGET
Commitment
Item
Salary
Non Salary
Salary
Non Salary
Salary
Salary
Salary
Non
Non
Non
Non
Non
Non
Salary
Salary
Salary
Salary
Salary
Salary
Salary
Salery
Salary
Oeseri tlon
(587,000) Reallocation to Fire, Library, Planning and Public Works
(155.680) Reallocation to Fire
(322,872) Imposed SEIU Terms
(1,065,552)
(143,970) Reallocation to Fire
64,286 Reallocation from Police
(253.533) Imposed SEIU Terms
(189,703) Midyear Vacancy Savings
(522,920)
(325,000) Reallocalion to Fire end Library
1,494,096 Imposed SEIU Terms
1,704,000 Midyear Vecancy Savings
2,673,096
____ --'-_ Changes in Budgel Stebilizalion Reserve
1,615 Transfer to fund training
3,966 Trensfer 10 fund olher supplies and materials
4,340 Transfer to fund training and safety
4,550 Transfer to fund recrealion and housekeeping supplies
1,189 Transfer 10 fund printing end mailing services
___ """"",6""6,,4,,,7_Transfer 10 fund olher conlract services
22,307
(22,307)
Reserve Belance ___ ,,(2,,2"',3,,0"-7L) Decrease changes in Olher Fund Balence
Non Salary
Non Salary
Non Salary
Non Salary
Non Salary
3,954 Transfer 10 fund programs and projects
1,506 Transfer 10 fund advertising and publishing
388 Transfer to fund other contract services
51 Transfer 10 fund travels and meelings
___ ~I,",3,,6C'2_Transfer to fund printing and mailing services
7,281
(7,261)
Reserve Belance ____ ("7-",2,,6,,IL) Decrease changes in Other Fund Balance
Operating Trensfer 564,628 Transfer from Sireel Imrpovement Fund for street maintenance
564,626
Non Salary (107,719) To close various completed projects and return balance to reserve
To return excess budget for salaries and benefits to reserve Salary __ -!'
992,542
Page 2 of 4 12114/2010
Fund
Fund Bamnelng Entrlee
SPECIAL REVENUE FUNDS
sj.",,( (mpi.""m.r\t~(lnd .
Use Changes
Net Char1gea: To {From) Reserves
fund Balancing cl1trieS
N91 Changes To (From) Re-serv9il
Fund Balancing Enn/as
Callfaml. J\V.n~. P •• ~lng Permit Fund: .
Use Changes
Net Changes To (From) ~eserveB
Fund Balancing Entries
CQlleQ'tt it.rrace Parking Pell'nlt fund
Use Changes
Net Changes To {Fr~m) Reserves
Fund Balancing £ntrio5
Us-eChanges
Net Changes To (From) R.eserves
Fund Balancing Entries
Use Chang08
Fund BalancIng Entrlos
ENTERPRISE FUNDS
ElaC\rlcFund' .
U80 changes
ElGIlBITA
CITY OF PALO ALTO
FISCAL YEAR ENDING JUNE 30, 2010 BUDGET SUMMARY
DETAIL CHANGES TO THE ADJUSTED BUDGET
Commitment
Ilttm
FY ZOIO
YearEnd A
Reserve Salance---"m=,54=2:-1nueaee In lntra&tructure Reserve
Operating TfBl1Ster ___ ~ TraO$fer tQ capital Proje¢t FuM
(564,626)
R eeerve BRiante (564,628) DecreMe cttatl$jt.re in Other Fund Ba's11oo
Operating Transfer ___ .;:10o;6?,.6"4,,,B,-Trsns~r to RerUlile Fund
106,843
110M'S)
Opora!lng Trans-fer ____ 1~G"',327~3~Transfer to Raruse Fund
W,373
Reeerve Balance ___ .I.(1~0,,!3:.!7:.3L) OacrlJase Changes in Other Fund Balance
Non fTlembenlhlp
___ -"=::..<.D"""'''. Changes In Daher Fund 8a1fP,1OS
Non Salmy 40,500 Transfer to fund program and computet expeMe
Non ___ ~~;-TranafS( 10 nCf'.cBpltallao!s and e:qulpment
Reserve 6alance ___ .I!{5~2;C!7.!26!!)LOecteBae chlinges in Olher Fund Balance
Non Salary ___ -':8'>;,9~20~ . Transfer \0 ioatruction and training
8,8i)
Resorve Balance ____ (8~,B~2!!O)LDecreaae changes 1" Olhef Fuf'd 8alance
Nen SSIw)'
1211412010
Nat CltangO's To (From) Reflerwtl
fund Bajancing Entftes
UsaChangea
Nat Changes To (From) ReaelV8fi
Fund Balancing Entrios
Ole Changee
Net ChMgee To (From) Rs80'lVU
Fund Balancing Entrl06
RofUlo Fund
Source Changos
Use Changetl
Nel CbangeB To (From) Reserve-a
Fund Balanclng Entrle.
EXHIl3IT A
CITY OF PALO ALTO
FISCAL YeAR ENDING JUNE 30, 2010 BUDGET ~UMMARY
DETAIL CHANGES TO THE ADJUSTED BUDGET
Commltment
Illl .. Deser! tion
onmpleled projects snd rSlwn balanc9 10 fa95IVa
Ros£<rva Belance ___ c:44~,6"2,,,o_lncreasa In Dis!nbullon RSR~ Gas
No. dose com¢eled pro~Clli and return balance to resel\la
Reserve Balance ___ -'2,,4"',7IJ""'6_1ncraaa6 Rate Stabibzalloo Re&9f'f1il
Operating Trensfer 106,646' Tranerer from University Avenue Parking Pamllt Fund
Operating __ -::+;~:;...Transr6r from California Avenue Par~lng Pe~mll Fund
(61, 749) To close compleled projects and return balance to reserve
(61,749)
Page 4 of4 12/14i201Q
EXHIBITB
FY 2010 REAPPROPRIATION no.",,,,,,,
$ COMMENTS/REASONS
AMOUNT INTENDED USE FOR NOT COMPLETING IN FY 2010 STATUS
City Manager's Office
$55,000. High Speed Rail Project 'fhis reappropriation i. being requested fur Recommended $55,000. There is
staffing coSls relaled to the IJigh Speed Rail sufticlenl balance in the Fiscal Year
Project. Per CMR 261: 10, Council approved • 20 I 0 budget that can be
the appropriation oUSS,OOO from the FY 2010 reappropriated.
Council wn!ingen<;y In fund these costil.
Planning Department
$40,000 . High Speed Rail This reappropnation is being requested for Recommended $40,000, There is
I'rojec! contract services related In the High Speed Rail .umclent balance in the Fiscal Year
Project which is a multi·year project that does 2010 budget that can be
not have an identified source oHunding, In reappropriated,
FY 2010, this project Was fundoo by the
Council contingency and was also absorbed by
the Planning Department budget. There is
remaining budget from the Destination Palo
Alto contract in FY 20 I O. Part of this
remaining amount is being prupoRed 10 be
• reaoorouriated to the HiJlll Speed Rail Proiect
$4(},000 Development Cenlnr This reappropriation is being requested for Recommended $40,000. There is
Restructuring Project eOlllract services related to the restructuring at suftident balonce in the Fiscal Year
tbe Development Center, Although it was 20 I 0 budget that can be
mandated by the City Council, this project does reappropriated,
nol have a designated budge!. There is
remaining budget from the Denination Palo
Alto contract in FY 20 10. Pa,t of this
remaining amount is being proposed to be
reoppropriated to help complete this project
Page lof4 12114.'2010
$ COMMENTS/REASONS
AMOUNT INTENDED USE FOR NOT COMPLETING IN FY 2010 STATUS
Administf<ltive Servicel'
$50,000 Special Studies This reappropriation is being requested for the Recommended $50,000. There is
funding of special studies that arise related to sufficient balance in the FiscolNear
the Stanford Expansion, Palo Alto Airport, 2010 budgephat can be
Cable Franchising, or other projects as reappropriated.
necessary, The budget for contract services in
FY 20 II is entirely comprised offumling [or
specific identified contracts, leaving no room
for unanticipated contracts. This
reappropriation allows for funding f01'
assistance on special projects related to the
City's finances,
Utilities Department-Efectric Fllnd
$2,000,000 Electric Efficiency This reappropriation is being requested to fund Recommended $2,000,000. There is
Financing Program an electric efficiency financing progrum for sufficient balance in the Piscal Year
nonresidential customers through a third party 20 I 0 budget that can be
contractor. On December 7, 2009, Council reappropriated,
approved using up to $2,000,000 from tile
Calaveras Reserve to develop this four-year
pilot program (CMR 430:09), It was Council's
intent that these funds be used for a four-year
program and rolled over throughout the length
of the program. The contract is expected to be
signed by June 30, 20 I 0, The program will
begin in Fall 20 I O.
$459,700 Cuslomer rebates for This reappropriation is being requested to fund Recommended $459,700. There is
energy efficiency customer rebates for completion of energy sufficient balance in the Fiscal Year
projects effieiency projects, A very I.rge number of 20 I 0 budget that cnn be
energy efficiency projects are either committed reappropriated,
or projected to be completed. while only a
small percentage of projects have been
completed 10 date, Actual payment of rebates
will occur as the projects are completed in FY
201 L These energy efficiency projects support
Council's environmental .ustainability
objectives,
Page 2 of4 12/1412010
$ COMMENTS/REASONS
AMOUNT INTENDED USE FOR NOT COMPLETING IN FY 201 0 STATUS
$300,000 Customer rebates for This reappropriation is being requcs\1:d (0 fund ReeoD\mendad $3110,000. TI.ere is
solar electric customer rebates for the installation of sufficient balance in tn\) Fiscal Year
(photovoltaic) systems pholClvaltaic systems. S6 I requires California 2010 budget (Il.t can be
electric utilities to offer inoon(ives for solar reappropriated.
electric systems installed on customer facilities
after January I, 2007. Because there is
uncertainty in knowing when a customer will
complete the solar installation, it is difficult to
match the rebate payments to each year's
program budget. The reason for this
, reappropriation request is to carry forward
fllnds from FY 2010 to FY 20 II to help cover
the large arnount of pending rebates. Each year
$1,300,000 is budgeted for this program.
Between January 1.2007 andMa)' 19,2010,
over $3,600,000 in rebates has been paid. Tbe
program has reserved an additional $2,700,000
I
for pending !l)lplicntions.
Utilities Dl!!partment-Water Flind
$54,000 Customer rebate This reappropriation is being requested for (he I Recommended $54,000. There is
program for cu~tomer rebate program for water/energy sufficient balance in the Fiscal Year
waterlenerb'Y reduction reduction projects. The Santa Clara Valley 20 I 0 budget that can be
projects Water District (SCVWD) currently otTers reappropriated.
rebates for innovative water/energy reduction
projects through the existing Water Efficiency
Technology program. The goal of the prograIll
is to encourage individuals 1.0 implement
innovative projects that will result in cos(,-
effective waterlenergy savings, Thi,
reapprorpriation is being requested to expand
the program In Palo Alto in coordination witb
SCYWD.
;
Public Works Department-Storm DraifJllge Fund
$629,718 Storm Drain Innovative This rellppropriaUon is being requested fIJI' Recommended $629,118, There is
Improvements innovative stonm drain improvements. These sufficient balance in the Fiscal Year
funds must be reappropriated because they 20 I 0 budget that can ba
have been specifically eanmarked for reappropriated.
Innovative .tonm drain Improvements per the
2005 Storm Drainage ballot measure approved
by the Palo A Ito property owners, These fu1Id.
have been budgeted for a storrnwater rebate
program that offers incentives to residents nnd
buslncsses to reduce stotmwater runoff.
However, the rebate prograrn has not genemted
sufficient demand In .pend the funds, Staff
plalls to utilize the unused funds ill FY 2011 for
an innovative storm drnin improvement project
in the Southgate neighborhood,
,
Page 3 of4 12I14/201Q
$ COMMENTS/REASONS
AMOUNT INTENDED USE FOR NOT COMPLETING IN FY 2010 STATUS
Admilll.ftrntive Services Department-TechllofrllIJl Fund
$94,000 Update of the City's This reappropriation Is being requested for Recommended $94,000. There is
[n[oml.tion contraci services related 10 the update Qf the sufficient bolanee in the Fiscal Yeur
Technology Strntogic CilY'slnformation Technology Strategic Plan. 2010 budget thai eM be
Plan This reappropriation is needed ro supplement reappropriated.
the cost ofthe full project, which is to be I
. comoleted in FY 20 II .
$100,000 Infrastructure This reappropriation is being requested for Recommended $100,000. There is
Replacement Infrastructure server equipment purchases and sufficient balance in the Fiscal Year
computer purchases. Not all of the 20 I 0 budget that can be
infrastruclllrc server equipment could be reappropriated.
purchased in FY 2010. The FY 2011 budget is
nut adequate to cover the cost of all the
necessary servers to adequllIely serve the
organization. In FY 2011, purchases will be
usell for planned system upgrades of existing
server •. We plan on purchasing and
implementing HP Service Guard which will
allow us to enable our enterprise servers with
recovery capability.
Page 4 of4 12/14/2010
NUMBER
General Fund
FD-09001
PD-03003
PD-04010
PD-O·IOt1
Po-050t 0
PD-93012
PE-05002
PE-95030
PL-02005
PL-07000
PL-07003
EI§Qtrlc Fund
EL-05001
EL-03001'
Ec-03005'
EL-03013'
EL-05003'
Gas Fund
GS-07000'
Water Fund
WS-Ol0l0'
WS-Ol014'
Refuse Fund
RF-OSOO2'
EXHIBITC
City of Palo Alto
CAPITAL IMPROVEMENT PROGRAM PROJECTS
Compleled and Oosodln FY 2()1()
TITLE
Fire Apparatus Equipment Replacement
Additional Fire Frequency
Fire Portable Radio Replacement
Civic Center Parking Securily Upgrade
Police Vehicle Mounted Video Recording
Fjre Communications Computer System
Main Library Reconfiguration
Downtown Garage Parking Structure
EI Camino 1 Venlura Traffic Signel
Downtown North Traffic Circle Hardscape
Cal Train Station Connectlvily Improvemenls
Colorado Sw Stalion 115Kv
UndergrDUnd Dialrict 39
Underground Districl41
Utilities Estimating System
Relocation -Alma Subs!alion
Elwell Court Tenant Improvements
Reservoir Booster Slation
Reservoir Pump Slation
Byxbee Park Gas System Upgrade
" Projects are closed. No expenditures were incurred in the current fiscal year.
Page 1 011
724
418
3,931
1,644
11,001
60,000
30,000
Total 107,718
1,143,983
54,987
261,880
15,094
2,067
Total $1,47B,011
44,620
Total $44,820
24,644
62
Total $24,706
61,749
Total $61,749
12/1412010
Taxe.s
Oceupallcy Tax
Fines & Penalties
lor Services
onln .... eslmcnt
Other Ageneies
to Other FundS'
[IY 2010
Adoptod
Budget
19,650
25,752
7,000
11,250
5,633
20,238
5,056
1,900
13,655
92
10,643
1,605
FY 2010
Adjusted
Budget
17,313
25,778
6,639
11,417
.1,584
18,932
4,596
1,662
13,786
323
10,546
1,739
EXHIBITD
FY 2010
CAI<[( U •• i.
RevlJo:.p
17,991
25,982
6,858
11,2%
5,754
19,732
4,577
2,682
14,397
332
2,439
FY20W
Allocated
Charges.
11,02B
117
[lY 2010
Ellcum+
Jteupprop
ni.
lila .1.
01,
.i,
nl,
p//l
ni,
.1,
.i,
ni.
nia
nla
5.9'20 nIl'!
2,569
999
1,512
296
2,395
Services 6,761
Sen"icGs 21,B76
2.j, 166
2,B37
6,3B.1
9,858
29,998
13,484
Site (D) 6,925
CAFR ReconciliatIon:
3,256 2,50B 75
1,075 927 31
1,543 1,387 67
335 2B7 I
2,386 2,196 86
8,052 7,50B 364
20,951 16,454 4,052
28,197 24,292 3,441
2,B27 2,540 167
6,756 5,902 4B6
10,/21 B,557 793
29,153 26,620 2,239
13,495 9,793 2,740
8,808 8,742
CUI'rent year cneumbrancc/rcappropritl.1ions
Prior Year ellcumbranceslrcuppropriolions
CAFR Net Income
(A) .$3.636 Equity Tmnsrer Su~b-iliza[ioll Reserve tmnsfer 10 GAS and Eleetric FUlIds.
(0) $5.9M Adjusted Budget includes. $3.9M sfliluy and bcncfi( savings co be neg.oliflted and achieved
Page 1 of 1
633
99
20
31
45
176
340
447
71
235
70B
231
Bn
55
FY2010 FY2010
Budgetary Variance
Rn/K"p Adj Dudger
17,991
25,982
6,858
11,296
5,754
19,732
4,577
2,682
14,397
332
11,028
2,556
3,216
1,057
1,474
319
2,327
8,048
20,846
28,IBO
2,778
6,623
1O,05B
29,090
13,405
8,798
3,965
(5,920)
(1,767)
678
204
219
(121
170
800
1,020
611
9
4B2
817
41
19
70
17
60
5
105
17
49
133
63
62
90
10
12/14/2010
EXHIBITS
WATER fUNO ($OOQ)
FY2COl1 FY 2010 py 2010 fVarfancu
ActuallE"e Ad]ua11l:d ActualJEnc Favorable:
""" Reapprop a •• get RO·PProp (Unfavor,l
REVENUE
Water sales 26,686 28,016 25,841 (3,075)
Other revenues 2,788 2,389 3,113 744
Bond Proceeds 35,000 34,958 (42)
Reappropriations I Ene 11,673 20,113 20,113 "
,
EXPENSES
Purchases 8,413 10,354 9.081 1,293
OtharExpensas 14,679 12,487 13,810 (1,323)
TOTilL OPERM;NG EXPENSES 22,982 22,841 22.871 (30)
Capital Expenses 26,110 48,655 49,155 (501))
Principal Payments 351 362 362 "
l'l'QtAj,;jliil(ji![Iil!e~ "" :;0'-;;:;:;',_ ___ J';~t; '.';,.,;'~'~'~.~
)t<liI(fflf,!!I!)'Rllilli:RVIiS' -,~ :"""" .;:.:q8~l"Om
ELECTRIC FUND
FY 1009 FY 2010 FY 2010 $ VarfanlCu
AcluallEne Adjusted Aotual/Em: Favorablu
"""",}~!,~1!!~ ____ SudgoL Rl)a~p.~2p (Un,.vor,1
REVENUE
~1.oIri<; ,.,.iI •• Ie. 106,463 112,624 111,140 (1,464)
Electric wholesale sales " " " "
Olher revenues 24,462 20,735 19,535 (1,200)
Bond Proceeds " " "
Rel'Ppropriations f Ene 7,551 10,900 10,900 "
r,:XPEN8ES
Purchases 82,348 77 ,719 63,713 9,006
NCPA & TANe Debl Svo 8,086 7,759 7,819 (60)
Other Expenses 43,453 49,011 44,870 4,141
TOTAL DPERAnNG EXPENSES 133,881 134,489 121,402 13,OB7
C""ltl!l E 'po ...... 16,743 16.483 18,550 (67)
Principal Paymenl. 100 100 100 "
i
Pagiil1 of" 1:211412010
eXHIBIT e
------~~~~-~~ ~ -~~ ~FiBER OPTICS FUNO-~ -~~ ~ ~ ---~---~
HZOO9 FY Z{ltO FY 201{1 $ VarJanc!I
Ac:luallenc AdJlJsted Ac:tuiltfEnc Favorable
Roapprop B!.!~i!i Ro".W"p (Unfavo'.1
REVENUE
Revenues. 3,790 2,990 3,593 603
Renpproprialions I Ene 182 607 607 ~
EXPENSES
Operating E>cpanses 1,710 1,387 1,510 (123)
TOTAL OPERATING EXPENSES 1,710 I 1,387 1,510 (123)
CB~ilBl Expenses 691 811 856 (45)
1!'t'~)(ER:IAMt'l!!~~t$\i.+~Il$fsllg'il$;Hil&i?'HI"fIlmJ' '"--'" , ·,hH __ ., __ -__ '" _____ JgV~-j.lr"'~"-""" __ -L w/'1_/. ~ _,) _._
I
GAS FUND
FY 2009 FY 2010 FY 2010 $ VarIance
AcluilllErte: AdjueteCl ,Aelu.VEru; Favorabls
Reapprop Budget R .. pp,op IUnfavor,i
REVENUE
Gas retail sales 47,425 44,517 43.502 (1,015)
Gns wholesale sales ---~
Other revenues 21062 2,417 3,248 831
Re1tppropr(ations I Ene 8,287 12,063 12,063 -
EXPENSES
Purchases 25,091 26,891 22,529 4,362
Other Expenses 13,580 16,457 16,191 266
TOTAL OPERATING EXPENSES 38,671 43,348 38,720 4,028
Capital Expenses 17,953 14,329 14,284 45
Principal Payments 443 443 -
Page2.af4 1:<'/14/201(1
. EXHIBIT E
WASTEWATER COLLECTioN FUND ~ ~~-~
REVENUE
Revern.res
ReappmpriaJions I Ene
FY~oe
ActuelfEnc
Rttapp;rop
15,466
6,545
FYn1~
AcijustOO
eu~~ ____
15,955
7,122
FY 1U111 $\'arhmce
~hla:11e1\C FavCl'lltlI9
R •• iV_.r,
15,914 (74)
7,122
lrI:~'tA.~ilU\l1llilillJ!i'i:iifi'(U;::::ii;i:: :i:i':~i~'f~ ,§1lliSii:"~'tt\i" :~ft:g3:jl3i~ . .::;i'flt'lfj,
EXPENSES
Sewer Treatment E;;:p.
OperaUng Expens6s
TOTAL OPERATING EXPENSES
Capital Expens ••
Pnoolpal Paymenl!i
6,131 •
4,785 .
10,916
11,246
58
7,933
4,623
12,556
10,906
61
WASTEWATER TR5ATMENT FUNO
REVENUE
Operating Revenuos
Restricted Bond Proceeds
Loan Proceeds
Reappropriatlons/ EnG
Bonded RoapprofEncum
EXPENSES
Operating Expen.ses
TOTAL OPERATING EXPENSES
Capital Expenses
Prindpal Payments
FY 2008
Actu2lLfE;~
R •• pprop
23,614
2,210 !
15,733 :
17
15,510
1MI0
34,577
~61
FY 2010
Adjusted;
SUdgit
21,987
26,298
19.572
19,572
28,890
364
6,519
4,244
10,763
11,441
61
FY 2!.i1!.i
Actual/Ene
R~pprop
·.i,D.
11,550
4,528
28,298
lB,I22
18,122
26,654
364
1,414
319
1.793
(535)
$: Vananc(t
FavQrllb1e
IUofavor.)
(4,437)
4,528
1,450
1,450
236
EXHIBITE
~.~~---~-~ -----~-~----~~--~-~ ~~ ~ REFUSE FUND
FY ZOOB FY 2,010 FY 2010 $ VarIance
AclU_flEnc AdJuflt>ed Acll.l'allEnc Fa\lOrBble-
Reapprop Budi<n Ro.,pprop IUnfavor.l
REVENUE
Revenues 30,022 37,323 29,163 (8,160)
Reappropriations J Ene 1,874 3,021 3,021 .
EXPENSES
Payments to GreenWaste 9,504 15,070 12,478 2,592
Other Expenses 26,334 22,256 19,582 2,674
TOTAL OPERATING EXPENSES 35,838 • 37,326 32,060 5,266
Capital Expenses 2,72() I 3,890 2.207 1,683
lilII'\111(liiOCQtlJl"!!s.V~$"'ti""il':"'~';:'Xil";";;:X~'~~2) )(~ '< •. " ) -,L _ _ -__ :N:h"-<,-",,n,/\\j&>_i!' ,,;, _ ~ ,'_ '"
STORM DRAINAGE FUND
FY 2009 FY2010 FY .1C10 $ Varlanc:e
Actual/Ene Adjusted AC~QIJEm: F~vor.abJe
Reapprop Budget Reapprop (~!?!~ REVENUE
Revenues 5,824 5,651 5,815 164
Reappropljal~ns f Ene 4,683 2,305 2,305 -
EXPENSES
Operaling Expenses 2,418 3,913 3,292 621
TOTAL OPERATING EXPENSES 2,418 3,913 3,292 621
CapitlllExpenses 7,418 3,748 3,039 709
Principal Payments 385 405 405
Page 4 of 4 12/1412010
"ISCAL YEAR 2OlO
: Rate stabilization
Geooral RSR
SupplV RSR
DistributiOn RSR
Total RSR
, Emergency Plant Replace
jColave,as
'Underground loan
COnservation loan
Landfill COrrective Action
Shasta rewind loan
Central V •• ey Project
Public Benellt Program
ij~~!rilI;~ty~~c,;"i
. fISCAL YEAR 2010
5,883
307%
Water
$17,037
17,037
1,000
EXHIBIT F
13,022 6,738 (1,147)
95% 150% 115% 892% -116% -21%
RESERVe: DETAIL
Electric Flb.tO "" Ga. WWC WWT RefMSe Storm Total
$B,2l0 $6,772 ($12,386) ($4,935) $2136 $15,044
44,855 12,339 57,194
9,484 6,209 15,693
54,339 6,270 16,546 6,772 (12,386) (4,935) 286 87,931
1,000 1,000 1,000 1,000 2,160 7,160
59,665 59,865
731 731
65B 656
305 306
3 750 3,750 ;t¥'i'll'03""~'·'",,;;>Ii:f.Dt;)j':1:;O:!!'lIij"'""~"!l»:i"~1~~!'i:~~':·;r"ftK'lij~*±:;;~~'l?;;i:lr;il'iii''''~;n~'!J'~tiiO''~''!'!I -~-,-',,~<_ 1 ... _""",,~,~·_ ,1!'t:~",.. _ '" A _ ,\,JIi;'lflfl:1f\4',H _ ~_ vv •• S ¥S;f,'f'lff; ,_ L-__ "-_-'Yl"A'~Z"'i,_10f1,_v_~_jl+//:,r7!9.:~t~P}Lj"i,;,~,~",f!t'!.iliji;
RATE STABILIZATION RESERVE
Water Electric Fiber Optla Gas wwc WWT Refu"" Storm Total
Beginning RSR $5,400 $47,763 $6,436 $13,182 $6,001 ($15,602) ($2,844) ($1,096) $59,258
To(from) RSR 11,637 6,556 1,834 5,366 771 3,216 (2,091) 1,364 28,673 ~1rdl!it:J[iijil]1?;~~; I'i:hll~r'11i.f)i)~R$[~~~~~~JJ'QI!~[~1i~1!;!OO!ll~fl!~~i:~~_l~~~.f.'Wm:;;:~~~~··XiHljjii:li;tift!
RSRMlnlmum
RSR Maximum
RSR % of MaXI mum
4,317
6,63~
197%
91,442
59%
547
1,367
605%
9,399
18,798
99%
Page 1 of 1
2,151
4,303
157%
3,199
6,397
-19'1%
3,242
6,463
-76%
N/A
N/A
NiA
68,576,
137,424
64r)/-u
12114/2010
FILENAME 1
Excerpt from the minutes of December 21, 2010
FINANCE COMMITTEE
Special Meeting
Tuesday, December 21, 2010
Chairperson Schmid called the meeting to order at 6:06 p.m. in the Council
Conference Room, 250 Hamilton Avenue, Palo Alto, California.
Present: Schmid (Chair), Espinosa, Klein, Scharff
Absent:
3. Recommendation Regarding Adoption of Ordinance Authorizing Closing of
the Budget for the Fiscal Year Ending June 30, 2010, Including Reappropriations
Requests, Closing Completed Capital Improvement Projects, Authorizing
Transfers to Reserves, and Approval of Comprehensive Annual Financial Report
(CAFR)
David Ramberg, Assistant Director Administrative Services Division spoke
regarding the Staff’s recommendation for the Finance Committee to approve
the CAFR. He said this was a required step and it was what carried over the
funds from one year to the next. In October Staff presented the Committee
with a preview stating there should be no major surprises; he said that things
seemed to be on track. He said Staff tracked the salary savings from mid-year
adjustments, and they were successful. The 2011 budget had no adverse
affects from the 2010 budget. The General Fund Reserve was healthy
Trudy Eikenberry, Accounting Manager discussed the changes to the CAFR as
requested by the Finance Committee. The 2012 budget would contain the
same changes. She said the Benefit Fund ended the year with $200,000 and
the General Liability and Workers’ Compensation Funds were $100,000 each
creating a situation where there was not a lot of room for fluctuation.
Council Member Klein disagreed saying there was room for fluctuation.
FILENAME 2
Mr. Perez clarified that if there was a negative impact they would have to draw
money from the other funds and fix the gap.
Ms. Eikenberry discussed the General Fund. She stated the balance for the
General Fund ended at a net loss of $1.8 million ending with a fund balance of
$41.4 million. The Budget Stabilization reserve was impacted by the loss but it
still increased $2.6 million because the other reserves did not require as much
funding. The percentage for the Budge Stabilization Reserve was 19.7 % of
Fiscal Year 2011 (FY11) expenditures and operating transfers and was within
the Council guidelines.
Mr. Ramberg said the encumbrance amount was carried forward to satisfy
commitments in 2011.
Ms. Eikenberry said the CIP Fund ended the year with $25.9 million in
expenditures including operating transfers out of 3.9 million. The fund balance
ended the year at $83.8 million an increase of $47 million over the previous
year because of Library Bonds. The CIP Fund commitments were $21.1 million.
She spoke about five years of expenditures in all major categories for CIP
projects. The Enterprise Funds ended on a positive note with a gain as well as
a positive RSR. She said the Wastewater Treatment Fund had a negative RSR
of $12.4 million. She said the Refuse Fund ended the year with a negative $4.9
million in RSR. It had a cash balance of $8 million which was sufficient to fund
the state mandated funding for the closure. She said that a post closure
liability of $5.1 million was from future revenues and did not have to be in the
fund at this time. It did have to be budgeted for going forward. The BSR
should be structured so that revenues exceed expenditures, which had not
happened in recent years. The RSR was a combination of gains and losses
along with other commitments. She discussed a graph of the major enterprise
funds and all were within the minimum and maximum amounts except the
wastewater treatment and refuse funds.
Council Member Klein said that he did not see the sales tax revenue comment
supported by the chart on page five of the Staff Report.
Mr. Perez said it would be in the fees and permits information.
Council Member Klein said the community should understand where the
reductions were and the report should be made clearer.
FILENAME 3
Mr. Perez said they may provide a table that shows that information on the next
report.
Council member Klein said regarding the Retiree Medical Trust Fund he didn’t
understand the liability per January with direct contributions to Cal Pers.
Ms. Eikenberry said there were two ways to pay one was direct and one goes
into the trust fund both reduce the liability.
Council Member Klein said he was concerned they were double counting. It
seemed the contributions made in August 2010 would have included the 5.5
million in contributions.
Ms. Eikenberry said that even though the trust was at CalPers it was separate
from making payments directly to Cal Pers. The trust was just for current
employees not for current retirees.
Mr. Perez said that was what the $5.5 million was only for current retirees.
Ms. Eikenberry said the next valuation would use a January 1st date and would
be brought forward in April and the liability would be high again.
Mr. Perez said they had to be concerned about this number. The cost factors
for the increases of the health care were different. The trust fund and assets
were different from the pension fund.
Vice Mayor Espinosa asked about future updates.
Mr. Perez said they currently bring the updates to the Finance Committee
quarterly by policy. The mid year report would be in March. Adjustments were
usually made to revenues at that point versus on the first quarter report. They
would also request any increases in the budget expenditures.
Vice Mayor Espinosa said he wanted to know what would be coming in the first
half of the year that might be adjustment surprises.
Mr. Perez said Staff recommended budgets for Staff overtime to be kept at the
same levels, and that could be an issue. If they felt it was trending differently
than budget they would report it. He talked about various revenues including
positive trends in sales tax. There were some commercial property tax
concerns as well as a potential issue with the Utility Users Tax that Staff needed
to analyze prior to reporting.
FILENAME 4
Chair Schmid asked about the adopted and adjusted budget which indicated
that the balance was achieved by a remarkable increase in revenues. The
increase in revenues was particularly due to return on investment.
Ms. Eikenberry said an unrealized gain they also book a reserve so that it would
not add to the BSR.
Chair Schmid asked if the 800 charge for services were fees that were imposed
over the last year.
Mr. Perez said this could include the Stanford reimbursement changes. It
would include paramedic fees, class programs, checking fees, and golf related
fees. He said this was changed due to IT and the Fire Departments share.
Chair Schmid asked about reserve balances and about some investments that
were allotted for.
Council member Klein said he thought they zeroed out the reserve.
Ms. Eikenberry said the equity transfer stabilization was zeroed out.
Council Member Klein said that unrealized gain could not increase as a result of
the equity stability being zeroed out.
Ms. Eikenberry said that any change would impact the BSR the there was only a
set fund balance.
Council Member Klein so it did increase it.
Ms. Eikenberry said it decreased due to the unrealized gain that went up.
Reappropriations dropped by almost $2 million.
Council member Klein asked for clarification.
Ms. Eikenberry pointed to the chart on page four of the slides. She said that
the reserves except Budget Stabilization were a specific number and were
funded first. Any difference goes into the Budget Stabilization.
Council Member Klein asked about the automatic procedure if it grew over
20%.
FILENAME 5
Mr. Perez said the excess goes to the Infrastructure Reserve Fund. If it
happened it would happen at the end of the fiscal year.
Chair Schmid commented on the Library Bond proceeds reporting.
Mr. Perez said Staff was following the Motion made by the Finance Committee.
Chair Schmid said the Utility Fund seemed to be very successful at generating
substantial profits. He suggested reserves should not be built when the rates
were 30% higher than other companies.
Mr. Perez suggested Staff should bring the audited information that
demonstrates the reserves that were needed. They did need to be reviewed
with the Committee to determine if the minimum and maximums were still
what was needed.
Chair Schmid asked where the total reserves were.
Mr. Ramberg said they were listed on a different part of the CAFR.
Ms. Eikenberry clarified they were unrestricted reserves.
MOTION: Council Member Espinosa moved, seconded by Council Member
Scharff that the Finance Committee recommends to the City Council approval of
the CAFR as stated in the staff report.
MOTION PASSED 4-0.