HomeMy WebLinkAboutStaff Report 1806City of Palo Alto (ID # 1806)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 6/20/2011
June 20, 2011 Page 1 of 2
(ID # 1806)
Summary Title: GANN Limit
Title: Adoption of Resolution Determining the Proposed Calculation of the
Appropriations Limit for Fiscal Year 2012
From:City Manager
Lead Department: Administrative Services
Recommendation
Staff recommends that Council adopt the attached resolution determining the Proposition 4
(Gann) Appropriations Limit calculation for Fiscal Year 2012. The City's Fiscal Year 2012
appropriations are estimated to be $30 million under the limit, assuming Council approval of
the Fiscal Year 2012 Adopted Budget.
Discussion
Article XIIIB of the State Constitution (Proposition 4) limits the annual appropriations for State
and local governments. The Appropriations Limit (Limit) is adjusted annually on the basis of
population and per capita income “change factors.” These factors are received from the State
in May, after the City's proposed budget has been submitted to Council. Attached is the final
Appropriations Limit calculation, based on the “change factors” that have been received from
the State. The Appropriations Limit for Fiscal Year 2012 is $119 million. When compared to the
recommended 2012 Budget, the City's Fiscal Year 2011 budgeted appropriations are $30 million
under the Limit.
Based on Article XIIIB, the City of Palo Alto can use the larger of two measurements of
population growth, (county or city population growth) in the Limit calculation. For Fiscal Year
2012, the City is using the Santa Clara County population factor, which is greater than the
population factor for the City of Palo Alto. In Fiscal Year 2011, the city population factor was
used in lieu of the County’s since the City’s population factor was higher than the County’s. The
City typically uses the highest factor in order to provide maximum appropriation flexibility.
As required by State law, documentation used to compute the Limit has been made available to
the public at least fifteen days prior to the Council meeting at which the Limit is being adopted,
and notice was published of the availability of these materials.
Resource Impact
The adoption of the Fiscal Year 2012 Limit has no impact on City resources.
June 20, 2011 Page 2 of 2
(ID # 1806)
Policy Implications
This recommendation is consistent with existing City policies.
Environmental Review
This is not a project under section 21065 of the California Environmental Quality Act.
Attachments:
·Attachment A: Appropriations Limit Compliance Calculation (XLS)
·Attachment B: Resolution Determining Calculation of the Appropriation Limit (DOC)
Prepared By:Sherry Nikzat, Senior Financial Anlyst
Department Head:Lalo Perez, Director
City Manager Approval: James Keene, City Manager
Combined General Capital Debt Special
Funds Fund Projects Service Revenue
Total Budgeted Appropriations
FY 2012 Proposed Budget ($ millions)150.41 118.56 11.83 4.48 15.55
Less:Debt Service Transactions 4.48
Capital Outlay 11.83
Non-Proceeds of Taxes 45.10
Net Proposed Appropriations Subject to Limit $89.00 $118.56 $11.83 $4.48 $15.55
FY 2012 Appropriations Limit 119.00
Under Limit By 30.00
Computation of Appropriation Limit:
FY 2011 Appropriations Limit:$115,057,884
FY 2012 Santa Clara County
Population Change (estimated)0.89%
2009-10 Per Capita Income Change (estimated)2.51%
(1.0089) x (1.0251) x $115057884 = $118,995,555
Historical Appropriations
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
Appropriations Subject to the Limit 73.30 78.64 72.00 78.94 89.00
Appropriations Limit 106.68 113.17 116.38 115.06 119.00
Under Limit By 33.38 34.53 44.38 36.12 30.00
Projected Appropriations FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Estimated Appropriations Subject to Limit 96.12 103.81 112.11 121.08 130.77
Estimated Appropriations Limit 126.24 133.91 142.05 150.69 159.85
Under Limit By 30.12 30.10 29.94 29.61 29.08
APPROPRIATIONS LIMITATION COMPLIANCE CALCULATION
FOR FY 2012 PROPOSED BUDGET
($ IN MILLIONS)
Attachment A
The City of Palo Alto remains well within its appropriations limit in FY 2012.Future year limit trends can be made based
on the average change in regional population and income growth. The appropriations subject to limitation includes
proceeds of taxes from the General Fund, Special Revenue Funds, Debt Service Funds, and Capital Improvement
Funds. The following is a summary of estimated limits and estimated appropriations subject to the limit.
1
RESOLUTION NO.
RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO DETERMINING
THE CALCULATION OF THE APPROPRIATIONS LIMIT FOR FISCAL YEAR
2012
WHEREAS, under Article XIIIB of the Constitution of the State
of California, the City of Palo Alto (City) may not appropriate any
proceeds of taxes in excess of its appropriations limit (Limit);
and
WHEREAS, since fiscal year 1991, the City is permitted to
annually adjust its Limit in accordance with inflation and
population adjustment factors; and
WHEREAS, pursuant to Government Code Section 37200, the
calculation of the Limit and the total appropriations subject to
the limit were set forth in the annual budget of the City for
fiscal year 2012, which will be adopted by ordinance of the Council
on June 20, 2011; and
WHEREAS, pursuant to Government Code sections 7901 and 7910,
the final calculation of the Limit has been determined, and the
adjustment factors on which the calculation is based are a 2.51%
percent change in California per capita income and a .89%percent
change in the population growth for Santa Clara County; and
WHEREAS, the documentation used in the determination of the
Limit has been made available to the general public for fifteen
(15) days prior to the date of adoption of this resolution; and
WHEREAS, according to the final calculation, the City’s
appropriations subject to limitation are approximately $89 million.
NOW, THEREFORE, the Council of the City of Palo Alto does
RESOLVE as follows:
SECTION 1.The Council of the City of Palo Alto hereby
finds that, for fiscal year 2012, the final calculation of the
Appropriations Limit of the City of Palo Alto has been determined
in accordance with the adjustment factors referred to above, the
documentation used in the determination of the calculation has been
made available to the general public for the period of fifteen days
as required by law, and the City’s appropriations subject to
limitation are under the Limit by approximately $30 million.
SECTION 2.The Council hereby adopts the final calculation
2
of the Appropriations Limit of the City for fiscal year 2012, a
copy of which is attached hereto as Exhibit A.
SECTION 3.The Council finds that the adoption of this
resolution does not constitute a project under the California
Environmental Quality Act, and, therefore, no environmental
assessment is necessary.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:APPROVED:
______________________________________________________
City Clerk Mayor
APPROVED AS TO FORM:_______________________________
City Manager
___________________________
Senior Assistant City Attorney
______________________________
Director, Administrative
Services