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Home My WebLink About2004-07-20 City CouncilCity of Palo Alto City Manager’s Report TO:HONORABLE CITY COUNCIL ATTENTION:FINANCE COMMITTEE FROM:CITY MANAGER DEPARTMENT:ADMINISTRATIVE SERVICES DATE:JULY 20, 2004 CMR: 357:04 SUBJECT:REQUEST TO PRELIMINARILY REAPPROPRIATIONS REQUESTS APPROVE 2003-04 RECOMMENDATION Staff recommends that the Finance Committee preliminarily approve the 2003-04 reappropriations (Attachment 1). BACKGROUND As a part of the typical year-end process, department staff work with the Administrative Services Department (ASD) to review outstanding financial obligations as of year-end. In the course of regular operations, these items span two fiscal years in the processing-- planning in one fiscal year and actual payment in the next. This necessitates, carrying forward both encumbered and budgeted amounts. Council approves these carry forward items in the year-end closing ordinance once the accounting books are closed. Staff utilizes the reappropriation process if base funding in the following fiscal year cannot accommodate the expense. ASD staff works with departments to minimize the need for reappropriation and ultimately rejects requests that lack merit. In 1995, the Fiscal Procedures Chapter of the Municipal Code (Chapter 2.28) was amended to implement mission driven budgeting and the 2-year budget process (CMR:212:95; CMR:155:95). Section 2.28.090 governing reappropriations was amended to allow Council to preliminarily authorize reappropriations of non-capital appropriations at the beginning of the fiscal year with final authorization to be made at the time of adoption of the budget closing ordinance. The purpose of this was to ease difficulties experienced by the departments caused by the late final approval of the reappropriations where the reappropriation was justified and sufficient funds from the prior year are clearly available. With ASD oversight, preliminary approVal allows the ,CMR:357:04 Page 1 of 3 department to continue with normal operations and spend the funds as of the Council’s preliminary approval date rather than the year-end ordinance approval date. To this point, the City has not been able to utilize the preliminary reappropriation process because of delays involved with the IFAS financial system, which required the manual entry of reappropriationamounts into the new year’s budget. The standard practice was to post the reappropriations after the Council approved the close of the fiscal year. Final Council approval would occur in January, resulting in at least a 7-month lag-time for these carry-forward items to be posted in the system. DISCUSSION With the implementation of SAP, there is an opportunity to take advantage of system efficiencies by allowing the system to automatically post the previous year’s reappropriations with the other encumbered carry-forwards as of the beginning of the new fiscal year. As noted above, the City of Palo Alto Municipal Code (Section 2.28.090) allows the "preliminary" approval of reappropriations, as-long as final approval is included with the normal year-end closing ordinance. The preliminary reappropriation action allows for an early review of uncommitted funds in a just-concluded fiscal year for possible .carry-forward into the next. Attachment 1 identifies those reappropriation requests that ASD recommends for preliminary approval. Final approval will be requested by Council after the books are closed. RESOURCE IMPACT Staff has determined that sufficient uncommitted budgeted funds do exist to allow for the preliminary approval of the attached 2003-04 reappropriations list (Attachment 1). General Fund proposed reappropriations total $444,322 along with $44,123 within a housing Special Revenue Fund. For comparative purposes, Council approved a similar operating amount ($311,671) in 2002-03. POLICY IMPLICATIONS This recommendation is consistent with adopted Council policy. ENVIRONMENTAL REVIEW The action recommended is not Environmental Quality Act. a project for the purposes of the California ATTACHMENT Attachment 1:2003-04 Reappropriations List CMR:357:04 Page 2 of 3 PREPARED BY: DEPARTMENT HEAD APPROVAL: CITY MANAGER APPROVAL: DIVINSKI Senior Financial Analyst CARL YEATS/ Director, Adm~istrative Services EMILY~-"HARI~ S ON ’ Assistant City Manager CMR:357:04 Page 3 of 3 Attachment 1 2003-04 REAPPROPRIATION REQUESTS Total Requests $1,098,322 $ 625,000 $ ~ 948,643 ........ $2,671,965 Total Recommended $444,322 $o 44,143 .. $ 488,465 Planning Department $60,000 $68,700 $86,600 Zoning Ordinance Update Stanford/Hyatt Senior Housing Project Downtown North & Lytton .... This reappropriation is being requested in order to utilize public outreach, including focus groups, website access and study sessions to ensure ongoing community input of changes being proposed. These funds were left unspent in 2003-04, in order to match outreach effort timing to presentation of each phase of the zoning code as it has been completed. This reappropriation is being requested in order" to provide the services for which the City has already been paid. The FY 2003-04 expenditures were carefully timed to meet the project requirements, resulting in a balance at year-end. This project will continue into FY 2005-06 This reappropriation is being requested because th~ trial ~?affic calming devices and cotmnunity discussion of alternatives continued well into FY 2003-04. Remaining funds will be used to continue the trial of traffic calming devices in the area and mitigate impacts in the Lytton neighborhood. Recommended $60,000. There is sufficient balance in the 2003-04 budget that can be reappropriated. Recommended $68,700. There is sufficient balance in the 2003-04 budget that can be reappropriated. R’eeommended $86,600. There is sufficient balance in the 2003-04 budget that can be reappropriated. Page 1 of 3 Plan ning Department, continued $75,000 Traffic Calming and Alternative Methods Police Department $43,000 This reappropriation is being requested becat~se due to other work priorities, these projects were not initiated until late in FY 2003-04. Theseprojects will be implemented in FY 2004-05 and will be fully reimbursed with grant funding, The City will be reimbursed in full with TDA grants of $25,000 and $50,000. Recommended $75,000. There is sufficient balance in the 2003-04 budget that can be reappropriated. $111,022 Design, development, and printing of a public education brochure encompassing all parking changes in the downtown area Integration of the City’s GIS and CAD systems This reappropriation, is being requested because recently, at council’~ request, staff worked with the Chamber of Commerce to study and Recommended $43,000. There is sufficient balance in the 2003-04 budget that can be reappropriated. examine the downtown color zone parking configuration and enforcement strategies.. Some changes have been made and a separate informational report (CMR:341:04) recently went to Council. These changes have delayed developing and printing of the brochures. The General Fund monies for this project are reimbursed from the University Avenue Parking District Fund. This reappropriation is being requested because as this was a multi-phase project (CIP PD- 02017), it has been necessary to deploy and fully test other deliverables in the project prior to implementing these changes. In addition, the department has had to rely upon cooperation from outside wireless service providers to meet federally mandated technology changes to ensure a seamless transition. Delays associated with those vendors and internal competing priorities contributed to the delay. The Project is currently scheduled and the contracts are pending. It is anticipated that this work will be completed by the Fall of 2004. Recommended $111,022. There is sufficient balance in the 2003-04 budget that can be reappropriated. Pa~e2 of 3 Planning Department - B?dR Fund $44, ] 43 BMR Unit Preservation Program Recommended $44,143. There is sufficient balance in the 2003-04 budget that can be reappropriated. This reappropriation is being requested because staff and Palo Alto Housing Corporation (our BMR program administrator) were able to take other effective actions to avoid the need for the City to directly acquire any BMR units to prevent their loss due to problems with the resale process. The City was also able to avoid . paying for urgent repairs needed to get units resold by strong enforcement against the sellers. However, these unused funds need to be reappropriated to add to the $20,000 budgeted for this purpose. The nature of this fund is to address emergencies that could result in the loss of BMR units and all monies set aside in the fund for this purpose need to be available to meet any possible emergency. The total available for these needs will then be $61,143 ($20,000 already in the budget plus $44,143 reappropriated). Page 3 of 3