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HomeMy WebLinkAbout0296.093- ." -' .. ;,~~,:.:' .. - .• nH~;;.,_ ~' , C , ' '" ", ',' " .. May 13, 1993 THE: HONORABLE CIT'l COlJ'"NCIL Palo Alto, California Attention: Finance committee aUOGEr'93-94 R.~SPONSES TO FIN1.NCE CJ;I:~ITTEE QUESTIONS Fi.E;:;.liRP_U,JG REVENUE AND EXfENDITURE T~ __ I!ND!? Members of the Council: Report in :Eriel This report is for informational purposes only; no Council action is re~~ired~ Building on tne Economic Future Study (EFS) (CMR:226:93), the report summarizes the responses on revenue and expenditure trends as requested by Council Menber Rosenba~m in a Il'.emorandult'. dated Januarr 2'2, 1992 (Attachmer.t 1). The list of questions by Cour,c i 1 Member Rosenbaum .. 'ere referred to the Finance Committee as part of the discuss ion on strategic planning~ During discussion of the 'Workplan for the EFS, some of the ele~ent-s of the City's fiscal history identified by Council Member Rosenbaum -""ere identified Ly staff as to be addressed in the ErS and relat~d staff reports. The .EolloW"ing discussion addresSC3 questions raised by counci 1 Member Rosenbaum, summarizing i"1for:rnation from the EFS; or indicating answers which \o,1ill be provided in a staff report from the Department of Human ReSOurces on City salary and benefit level.!; compared with the private sector; or fro~ other sources. CMR:296:93 - P Wb.t WAS the :rate oCmi.!!g_~ __ I!ta.:ge of expe:rt~ i tUres _~_1,1X __ .i:n_q.m_1:_b __ ~_~ decadE! and how doe~ ____ it campare to the ehang_~_i.lJm_!he Cons~.yner_-.I..rice In~ex (C'PI.l.1.: Total General F<Jnd expenditures in fiscal year 1381'" 82 were $29.7 ~illion; ten years later. total General Fund exp~nditures WEre $62.4 million. This represents a compo~nd annual average ~ate of gro~th in expenditures of ,~J percent. Over the sam<;! dec"!de, inflation as II'easured by the Bay Area Consumer Price Index averaged ]:.8 percent annl.l~ lly. Thus, G~nera I Fund expendi­ tures grew 3.9 percent above inflation during the la:::;t decade. It sho';ld be noted that the City has: consistently added ne ...... services over the past ten years; so that cc.:np.aring growth in General Fund ex.penditures to gro .... 'th ir-, Cf'I is r-.ot ne.cessarily useful from an analytiGdl standpoir.t, !ind requires additional information. 2) How _J~lUC]:t_ of the increase iOm_~xpencH tures can he a~_t_~ __ j,.b'i.l_:f;_ed to Raw proqr&!llB i'1%1.(5 mand8..t_~~mmJroJl other lev81~m...,S;>_L ___ g_ove.rnment? ~ An attempt has been made j as part of a c~ordinated city response to the Governor's proposed 1993-94 budget, to identify all of the mandates imposed by the State and federa 1 government on cities (Attachment 2). However. quantj fying the impdct of a 11 of these -mandates would require an exorbitant amount of staff time, even assuming infor~ation would be available to do so. As part of the effort to communicate 'With legislators on the j!l1pact of the Governor's budget, cost information on certain It''.ajor legislative actions to.as been. compiled (P.ttachrnents 3 and 4). ~~ithout signifi­ cant analytical ~ffart, this is probably the best estimate available of the cost of State and federal mandates. 11 What was tbe rate of m:i:_I:LC!x_,,_ase of revenu~s'---~mmtotal, and for each major :!Iou,,I;_~e1_: Total General fund reventles in. fiscal year 1981-82 ...... ere :;;33.1 mi 11 ien i te:1 y.;ars later, total General Fund revenues ".tIero $66.9 :-::i Ilion. This repres2r.ts. a compound annual average rate of growth in r€vef')ues of 7.) peor-::;ent. P.5 rnent loned above r aver the sarne dr=cade inflaticr, averaged ).8 percent annually. Tl"~us, General Fund revenues gre· ... · ].5 percent above inflation during the last decade. Sales taxes aTe the largest source of Ge~eral Fund revenue; they grew from $8.2 million in 1981-82 to $14~7 million in 1991-92, or an average of 6.0 percen"t annlJally--fully 2.2 per-cent per year above the rate of inflation. Property tax receipts ' ... ·.;re $3.9 million in 1981-82, and :c;ore than doubled t.o $8.£ :Tlillion in 1991-92. This represents average annual grotJth of 8.3 percent, nearly tWo-and-one-half times the rate of inflation over the sane period. Unfortunately, 1991-92 was the high-water mark for City property tax receipts. rhe state budget for this year (1992-93) took away $0.9 ~illion of property taxes CMR:2:96~93 2 annually, and if the Goverrwr's 19903-94 state bt..:.dget propos,~l prevails, another $1.7 million ; • .rill be removed annually. Thus, the city Manager's proposed budget far 1993-94 projects only '$7.0 million of property taxes--a le'.'el barelJ~ higher th<'lr. 1936-87 receipts. The utility users tax did n':Jt exist in 1981-82 ~ but nClW raises mor~ than $5 million annually for the Gene~al Fund. Transient occ~pancy tax (TOTj revenue has nearly noubled, f.rom $1.6 million ten years ago to $3.1 million last year, but t>"1.(!t is ttostly jue to the 1984 rate increase from €i percent. to 10 perceni':.i adj'.Jsted for tnat rate:: increase, TOT revenue gro .... th has lagged behind inflaticl"'. b:t more than 2 percent e:ach year. The joint service a9ree~ent with St.anfcz-d University for flr-= and emergene)' co.TJ't'.uni:::::ation serviCES raised $3.1. million a. decade ago and $3.9 ~.illior.. last year~ for an. average annual groltltth rate of 2. 5 percent~ .... hich ""as less than inflation--because the 1981-82 total inc10des some one-time capital equipment purcha:>es that -.. ere not repeated in J991-92. Int.erest earnings for the General Fund were actually lower in 1991-92 than ten years earlier because of adjustments in interest-allocation methods. Revenue from service fees and permits has increased substantially as a result of policy decisions to recover from users more costs of serlice. Total service fo:=.e and permit reve!"lue nea:::ly quadrupled in the last ten years r from $1.7 million in 19S1-82 to $6.6 million last year. The average annual :tate of grO'ltth .... as 14.4 percent, or almost four times the rat.e of j nflatio"i-::. Like sales taxes r property taxes, and service fee and permit revenue, operating tran:;;fers in to the General Fund also expe:ri­ enced large real growth durir-.g the last decade. The bulk of the transfers are fr-011l the City's enterprise furds: property rental and a rate of return based on net. fixed aS3ets. These transfers totaled $9~7 million in 19B1-82 r and $16.1 million in 1991-92. ~ne average a. .. nual rate of increase ",,'as 9.4 pe~cent. '",:ell above the an~ual inflation rate of 3.8 ~e~cen~ . .. ) !hat was the size of tbe c;;..~nt-Y ______ $j::n~.JJ': e~ch year during the deea~.~ in each of tJl~~n~n~nl;.~.1 Fund <departments and in the utn:inlit·t"'n$n? How mAny contract employees 'have we had?: There is no way to d1 sc~rn the number of contract e.rr.ployees used by the Cit~{ since collars alone are buogeted for these services, and ir, the sa-rne category as consultants and other contract-type services. Sho""n below arc the total number 'Of full-time equivalents in the General and utilities Funds for the past 10 years, taken from the annual buoget docu­ ments. Staff accumulated this data on organiz.ational structure and staffing levels as part cf the research for the ErS, but a revie~ of the data revealed it ~as not reliable or useful for analysis, pa::-ticularly becaLlse of the var iOllS reorganizations that took place both inside and outside a:1nual budget qlcles. CMR: 296: 93 3 ---"'''''''~l~''. "._""""'''~'''j':l.e~ . - ·n I I .j -" Year Gef1era1_.J\J.r:d (.) 1980-61 64B.31 1981-B:2 646.45 1982 -8 3 651.96 1983-84 65.7.5 1984-85 £57.5 1985-86 666.75 1986-87 676.25 1987-88 670.25 1988-89 652.55 1989-90 654-.17 1990-91 654.17 ( *J Inclu.des Internal Service funds l)tilities 140.5 156 192 1S8 218 22'3.5 236.5 252 255 270.5 272.5 788.81 802.46 843.96 865.5 875.5 895.25 912.75 9;;;2.25 907.55 924~67 926.67 ~Whac: vas the rate of inereas~ of salaries and bflJ':i.~_.titJ ... ___ .~er yployee and bow c1J.~ne_~.~.bis compare to the priv~n~e sector1: This 'Will be addressed by the Human Resources Department in a separate staff report, to be forwarded to the Find~ce Com~ittee in september 1993. &) Bow 40 city el@'.loyee benefits compare tQ ____ lll.9Se in tbe private sector?: This will be addressed by the Human Resources Departmen~ in a separate staff report to be forwarded to the Finance Co~~ittee in Septe~ber 1993. 1L-How much h.&.ye v~L. spent on capital b·.prov~.l:!1nent9 each ye§.r ancS vbM h'--n our policy for funding tt}n~ ___ ..J:,~p.,i.ta.l improvemen .... LJn7.~,r~.1:!l.1.: The table be. 1 0 .. ' ShO'lo'H the annual General Fu'~d appropriation for the CIP ar.d, 'Where available, annl:al Gen~ral Fund expe:1ditures for capi tal proj ec:ts. )\..ppropriatior,s and actual expenditures are differe.nt for 1'!'.0S',:. years because of the time lag in expending annual appropriations~ The le\··el of both the appropriations and expenditures jumped in 1987-.':18 after the establishment of the utility users tax, <'.'hich generated an average $1 million annually for street and sidewalk repairs. CMR:296:93 , - Genera.l Fund Capital Improvement progra;t1 Annual Appropriations ~nd E~penditu~es (millions of d911ars} fiscal '(ML A ppl"'opr 1_.:1 t i 011 F>:< Q end i t~_r_.g 1981-82 $1. 6 • 1982-83 2.0 • 1983-8. 2.7 * 1984-85 3.5 2.8 1385-86 2.8 1.6 1986-87 2.7 1.3 1987-86 2.4 4.3 1988 -$9 4.2 4.5 1989-90 5.2 4.2 1990-91 4.:-5.7 1991-92 2.9 2.2 *Not available due to lacw;: c,! re] iable financial records. The City's policy for elF spending has gener~lly been to appropri­ ate $3 million each year (not counting additional dollars available from the utility users taK) for maintenance and improvement of the City's infrastructure. 81 BOJI do we 4istinaui!lh :t:>etween long-term cl:!._o!!_ra~_~ in revenue growth and short-te_~ c:hacges due to __ :r~g __ ~_s:siolJ?: This lS a question that has vexed economists at all levels of government for dec.edes. It is a particularly difficult question to ans'w'er for local government: because there are no local eco~omic statistics to whiCh local rev~nues ca~ be related. Fo~ example, at the national level it is possible to construct econQmjc ~odel~ of federal tax receipts under different scenarios for gro'..,'th in gross domestic product. Similarly, re',;enue estinators in Sacr3n~nto ca:.n :predict state rev~nucs for different levels of qross State product. But there is no "gross Mid-Peninsula product" statistic~ and thus no handy i!'.easure of recession versus "normal" economic groW"th. Furthermore, the major sources of revenue in a loc3.l government's tax base are influenced as much by the continual press~re of nearby competition as by recession or boomjng growth, For example, has Palo Alto's TOT revenue grown less than inflation ber.ause the hotel industry has been in recession for t~e last decade, or bec~u5e the highly desirable mid-Peninsula hotel market has been fiercely competitive, thus holding down average roo~ rates? Similarly, have Palo Alto's sales tax receipts slumped during the last few years because of the recessicn.. or because shoppers are being lured elseWhere? Answering these questions qualitatively, let alone Cl!R:296:93 5 - o quantitatively, is a very difficult tasx--one which staff is not expert er,o'.lgh to do~ g) rtl. uncert __ ~in ___ eec;nomic timBs. ~):l~~ __ !!Ii __ l'1o'Ull5 our poliey be towa.rd~ Ilu.lti-y@,sr labor contracts? See numbers 5 ane 6 .above, lll-ft9ulc1 our labor eer.trae!_~j. synchronized. with tl'l~~'fo-year budget. evcle so th~_~_Z) __ ._goti .. tions become a --p_art of the budget process? See numbers 5 and 6 above. 11) what major businesses ha.ve .l.i&ft _1»_&10 "'It.o during the last :few Yll_rs? 'Bow much revenue h..~v. V9 lo~t as a re9J~.1 t? Was lhe: (I.oiaion to leave~esult of • city pol:l,_~L_c;>r simply a business decision hSJrinq nothing to 150 vl..tlL_ml:;ity policy?: Staff has not been able to address tr,is ke)o' question i'et, but perhaps it could be made part of the Economic outrea~h effort that Council and senior manaqe~ent will begin this summe~. Related Staff Reports; CHR:225:93 CMR~296:9) 6 '-'-... '" ,,--; - AnACHM£NT 1 Jan. 22. 1992 To: My Colleagues From: Dkk Rosenb2um Subject: Council Priorjlies I want to suggest that we make {he d8ve:opment of a long~range f!nancral pian one of our Council priorities for 1992. Palo Alto is a mature city with a populat,on thai hasn'l changed significantly since 1960. We h2ve a large insta:fed base of commerciar and indu5tr;,ai development but can probably not expect to see any significa.nt annual percentage increase in ou' commercia' and industrial base in the future. VI/e have historically provrded a high lever of service to our residents. The problem to be addressed by the p~an is how 10 mainla:n cur se;-vjce leve!s in a low-growth environmen!. As a first step, I believe we should take a hard look al revenue and expenditure trends over the fast decade. Ths attached articles suggest some of the questions that we sr,ourd ask. As a new Council thet ~s I!,~ely to be together for many years, I thrnk 1t is particularly appropdate for us to de'JeiDp a common:y­ accepted database that will serve as a reference-kJ'r wha! has occurred i:i the pas!. Hopefufiy. it wril also provlde guidance fer the Cha:1gBs iE'quired in The future. I wourd like to see slaff respond to the following questions: 1) What was the rate of increase of expenditures d~ring the past decade and how does ~ compare to the crJange in the CPI? 2) How much of the increase in expenditures can be aHribu!ed 10 new programs and mandates from other levers of government? 3) Whal was the rate of increase or revenues, in totai, and for each major ${)urce? U2 t 11 iii .......... --- - 4) What was the size of the city 51aft each ~'8ar during the deG13de in each of the General Fund departments and in the U:iljties? Ho-w many COrJlract employees have we had? 5) What was the rate of 'lnc{ease of sararies and benefits per employee and how does this compare to the private sector? 6) How d'J city empfoyee benaf~ts compare to those in the pr~vate sector? 7) How mucil have we spent on cap:tal impruvements ea::h yeai and what ~s our policy for funding the capital improvement program? 8) How do we distingu!sh between long-term crlanges tn revenue grcwth and short-term changes due to recess'lon? 9} In unc6rta~n economic times, what should our pol"lq' be towards multi-year Jabo{ contracts? 10) Sr{)uld Our labor contracts be synchronized with the two-year budgel cycle so that negotiations become a part of the budget process? 11) Wl1at major businesses have !Rft Palo Alto during the lasl few years? How much revenue have we lost as a result? Was the decision to leave 2 resull of a city policy or srmply a busiliess decision havir,g nothir,g to do wlth c:ty policy? I regard this list as merely a starting polnt arj I \/,iBi:D;";19 YC:.Jr though:s and those of staff. Also, I recognize that ihis assi,gnrnen! couid rj'J'c begin urltil July because the appropriate st.arr will be worKrng on tr~e budget. '. @~©~uw~~, iRI L,' UI.: JM. 27,993 OFFICE OF THE Cin ~"'.NAGER DATE: JANU .. \RY 22, 1953 TOWN ofLOS GATOS 'Io: FRCM: SUBJECT: SA.."""TA cu·_~_ COUNTY CITY H..-\''''l'ACE..1(.S D.~VE K.l>lAFP. TO; .. '}! X."'-~AGE.R ~ STATE AND FEDERAL ~~~~DAIES r--. June Fle~,g, Cry Manager City of P.lo Alto 250 Harnit: on A \,:e~ue P.O. Box lD250 (94302) Paio A1!o, CA 943'~1 Phone (415) 329· 2563 FAX: (415)328-3631 The attached list of st.a'Ce and federal Irandates is c'JllJpiled fro:: lists )'Ou. h.avc; sent Cle. I'm also s~nding a liseing Dia:me Cershing se-nt and the te,.;;gt.:e of Cit.ies "'ish List.. which broadens the focus froe:: reeo·JLng Cl2.r',Cat.es a":",d il":.c:'"..:;.;:ics methods to increase. revenues. Please: send me any c.orrections or additions you ca.n think of. , . -'. '-"... )~.:t " ---~ -""'" -, ~I~< Cv 15 (,-(i 5 1-----u-' ( lie i ___ QH1C r,1.{( 11£1(( le s'": League o( California Clcies Revenue fle:c.OU:ty/State _Manqa!e Elimination Proposals • JULe 12, 1992 . . Refcrms J.o Reduce Cltv F=wenQityI~ 1. ~nance of E.ffQ.n. Rc:peaJ. We rn.ai.:Itenance of ~ffor1 require!I!c:nts fer Gas Ta.':'. proceeds and uDra.7 fund5. 2. G,O Bonds. Autbodrf for locaJ general obligation bonds \!lith Cla.jant:t V~:~ approval. 3, Y{Qrke~CQmQematic:t. Gange thresbold of injUJ)" aud stn:ss clai.m.s fro.:n 10% to a majorit"j far all employers. 4. Workers' CQr.;:'"1eD.&D..QQ. Exclude j(lb layoff and e ... ·aluation.s from po:e::ti2..1 worker.s' compensation c:aim criteri~ 5. Workep' COIT,1']eruat1on. Drop 4850 time for Police employees. 6, Worker,,' CQm~e"5atiQn. AfT.er ckslgIiated period of time, mOlle disabled \VC wes to PERS retirement 7. WOIKer'" CQrPperuatiQD.. "ln1eg:r2te" ol.her ealrd~gs i\1th disability benefit, rr.eJcinE the we paj'lIlect a minimum guaran(eed amOU!ll 8. S~aim5. fuclude p<llice and fire personnel in lbe prop<lsed higher standard for stre.ss-related worke-rs' compensation claims. 9. liea..'1 and rg_~.:'er ~:rre:9m!)ti;ins. Repeal t1:e a~tOGJ2tic pre~pcon that hert conditions ru:.d cancer :are work re1ated compensable injuries for yJlice aDa Ere p~rso1l.:.'1eL 10. W=ru. tlJltnonze a two-tier PERS retirement for Jo<:alagencies. 11. Retirement. Authorize defined 'cDnmDetion' plans (rather than defined "bene5!") as second tier i!! PERS (private sector model). 12. Mand2.te5. Amend SB 90 50 that nc'.!,' mandat.:s become optional if tbey are p;tS..Sed lViiliolJt a:l app;opriation for local cost5 3.!!d the Ivca! agency can show that a'local cost exists. - • ,... , c ,.j • 1 28. 29. 30. FjSD a.'ld G".,.,<~. Repeal Fish & Ga:JOe fe" (l0J3 3158). WOfErs' CQm~I':j'L<:atiQnfBl1si"'e5s Jjcenx Tax. Rep~al A.B 1576~ requI..--io.g cities 10 enforce worke:-S"corop<::nsation iruu.""ance requirements in coc.nectio.::l with is.rua.cce of business lice::lSo.! wes . fur! Di.ltrigs. Amend laws governing port districts 10 mO~e equitably a!low reimbursement to cities for services provided to propertil!:5 located on Stat! tiddai'lds 'Wit.hl.!:l a port district'S jurisdiction. 31. Hoss Fee$. Mow b ost com.:nurltie.s of solid \\o'3S!e facilities to i.rnplemeut a su:-cbar£{! (bost fees) t:'J !be user to offset negative impacts to the community for ba\<bg the facility within theii boundaries. It could also have an effect of ac-Jng as a future incentive for cCII:';.':!lunities to bave solid ""'aSte facilities. 32. 4Pci,<iI1<. Defer for three years the requiument to comply .. lith AB 2448 concemg the cloS1l!"e and pcst-closure maintenance of landfills. 33. l!l.sYLance. Flj"""i:late requirement for operating liability insuracce forland.fi..l.ij (1oc:at ope~tor to handle liability). 3 ~, ! " ,. 1. Mue ci::y revenue lOss short-term. 2. Out=Q!·Stal<: S::-Je". Collect use tG..l from out-of-state: retaileG at a r2:tc: equa.J. to the st'?'!c:'~~de a.ve~ge sales tax (7.5 cr 7.750/0). 3. Cigarette Ta..,=. Atnnority for a loca! cigarette tac or surcharge on the e.ris::.ng dgar.eu<! tax.. 4. Akl"'noLTE.-.3.. AU~Drity for cities to tax the .sale of akoholic beverages. 5. ~Fi.n.a:1ci'a1 wnmt:i.mJ!. Repeal exemption for ba.IJJ.:s ;;nd En<!lldal irut.i.rutio:Qs fro!!llccal busmess lice-rue l,a'Ces. 6. IQ!:llrance'. CQ[pQratl[);o;S ar;d A~~1lS.. Repeal the cou.stirutional exemption for lruwaoce indusu)' from local bu.siness licen.<;e tax. 7. PrQfj?rt;r Tax. Re:a..sse.ss prcperty iJo'hen 50% of the ov,'D.er:sbip lra..."1£1ers. 8. 'PjORertv Trarufer Iou. Allow increases in property tra.n.sfer tax. 9. Franchi« F.e~. Broaden franchise authority (up<la:e 1930 12w). 10. TeJepbQne Francbis~ Fee. Repeal telephone exemptioD nom irancb..!!:e 2.uthoris-. 11. SB 2.c:;~7. Repeal SB 2557 req\lll1ng city payment to counties for bookings ru:d fo. ad.mini.stratioll of property ta"{es. 12. Pr~ertY t?,X. Allow cou.nnes to cba:ge prope:<ty 4U colle-criao. costs' 00. !.be roll a.'i a cost ba:ed fee. (Er.ds prop<!rtj tax: aCmini5!.ration fee fOf cioes aDd sc'tools.) 13. Cougt:' Ta:q;s. Require countii:s ta t!.Se local general tax: autbority such as utiJity t;.Ser tax, sales tal: and busmess license tax as a conditiDn to u:cc:iving an incr~~ed portioa 01 VLF or property tax. .- 14. Parcel T .. <. AUtborize counties 10 levy a county.ide parcel tat. 15. ~Tax.. Authoriu cities to impost a local option sales tat. 16. Income Tax. Authorize cities to le>y a local income tax. ., .-:::,~~~:'.~ - -------------,._. G£NEf6J-L ~Qrker~' cornpens~~lon State IM.nclate$ sig::11flc.an":.ly criYe up costs a::1c facilitate Chl:3tir.g (e.g_, thrubold for injury and stress ch!m5 15 10%.) .. QSH..j ICAkQ.S HA R~qclres training, r~porting. ::orrective actil")", !"eccrd keeping. ll!;borjma •. agemet',(. co~lttee. meetings for occupational safety ~r.d health. Requires industrial injury prever',rio!'l pI,,!!:"'; e::lployee rrair.lr-g; additional tl!c,:,rd keep!!'.g, laber/management COIIJ.."1.ittee. REquirts E-ffirmative act:~on plan, s~ecial recn.:.it.J:::e"t. p:oc.ess. ri':;::~rting, .extensive record keeping, It:onitoring, gri!:vance am! .o;ppeal process. Fension requirements Several State rO!ql.lireme:nts i"cre"'se costs dnul'..ctic.a.liy (e. g., p!'eSll.t:l;J:::~~'J t.}-,d~ heart problems and cancer in public safe:::y n.ploye:es ar,", j-o:' nlated). Requires tha.t ref..:nds first be used to avoid layoff:s. P.eq.uires cities to enfcrce lo'c.kers' compens<'.tio:'.. req'..;.i~e:r_el".ts ~n con::-:.ec;:lol". ""'ith issuance of business liceer.ses. Requires mu.nicipalities ttl evaluate th!::ir 0· .. '11 pt.:.blic progr.e.r.: fadliti<!s; to .. dopt a tre.nsition plan to identify and remedi.."te defid.encies by 1995; to evalu.ate personnel req\l!re~ents and to provide r-easona~ll2. aCCNlilli.odation in the ",,·orkplace. Re'qaires ci.'.micipalities reqcire~ents when issuing Conflict of inter~ t.o Evaluate cornpliar;ce vith St;;te pe rm! ts for ne'", cons tn..:c t i cn or b1..:.il c.ing acc""ss i b i 1 i <.:.y ixr.:provelllents. Requires extens!v'C repo.::cil"1g snd record keepi.ng for et!l?l~)'ees, elec~ed offici.als. and volunteers. ;. ... "- .!Irown Ac:t Rt:'1uire~ r.ctificat.ion and p-osttng of a.gendas for p-...:~llc a:ee:::ir.,p .... ,Lr.:"itl t:ia:e­ deadlil11;s; eJ!:pp.nas cove=iilge; rEqu.ires i!"'.cre<"~ed Il.dve:rtlse~"'nt. Re.cords rl'.tenti.N"J Requir~s monitoring, io=ml..~lat.ion of recor-ds retention plan, n:t;?nt!un of rE=cotds. Req .... ires pla~ to !teet reg,ior:al nOYsir'E alloc.ation; jur1s.:!tcciot"'. rt".lSt 5":10"101" n"'..l!ll.erical ptogrl'ss ",ith each revislon; pI.;;. •• c.ust be cert.ified by St..;.':.e, Requires nexis bet ... ·een c':JndiCiCJns of app:::o· .. .11 and b.enefic.c;; record I:-E:e?bg: repotti!'.g. Requires Ill',miclpalities to s'HTey. track ar,d requ! re '..lpgra<:!e of t.r?'-o"! .'5tn.!ctures. Public safetv tuintns Long list of training requicE!:<er.ts for p-...:blic safety f'~plo}~es is c::a:1c ... :o:d Requires payments to coun~ies fer booking fee.s a.";"",d property t.;;.x <,.c,"inist".a::<:,~. £N"VIRO.',·~ENTAL Req'.lices mU:1icipalitioes to a::,u;ly<:e e';ery to ~itig2~e such iwpact; and to ~or.itQr Non-point source act for Fo::e,,:.ial iL'lpacts fore·"er. Re<:;:ui.:res municlralities to mitigate pollution from stCnll .... iit~r rl,;.T"".'c·ff. I"ci..;c,,"s monthly "lCt!etings; rev!-a'J of all ne ... · c.eveloF::ent:; repoI .. ir.g r:e;;lJ.ire:.::e:-,ts; location, id"ntificatic-"n anc mapping of drainage facilities; creat L("',n of drair'~6"" master: pla:J.; public outrea.c.h a.nd e-ducatior1; ir.ter.sive clear:ir'5 of storl: ct.c.i" 5yste:ll; identifice.ti"Jn of illegGl r..::ok-·"Fs and ct.:Jt.pin,g t enforcf'~er;c a.vl :c-:!':':"­ up; General Plan ame~~ent. Requires storage, inspection, tereo,,, ... l, permitcirlg, disclosu,rE, r~gulatior. of handling. RequIres Haz~t planning, identification of sitt!s. P.equires lI)unicipa.liti~s to Analyze all n£1oI d~,,.elop"'El-:<t:: '.d.th !."ro~.a;rd to traffic gel1 .... rated on established transporta'::ioil r.!:lt. ... c,rk; to :Il~ti,ga.:e beyond c~Fa~ity; t~ <!lonitor inter-sections annually and prepare a71:i.u.al re;;orts; to attend Illeetings:; establi.shes s new lev~l of regional gc'.'<:;:t:n..:c.el1.t vh!ch dicca::i2s 'ho,,", tr,e T('\r.1.'s 1I:.a!.ntl!!r.anc~ of effort money .... i 11 be ,siH!n-:, Requires mun1cipalities to reduce material sent roO l.c.~,df.!.lls by 25:1': by 1595 and ;·0% by 2DCO through .r-ecycling, publi-:. edu<::atic7.; ::equires p.xtensi·.e. ar.nual repo!'ting. Scate ca"dates e:xcessive liability :'r.surarLce nq,uirf't:!:ents icr la!',:!fill operations. Requires in;pec..tion Bnd cercificatio'1 cf ..... ehide. ~.air.ter,ar,ce "6t'Jd r~pair fac.ill~i.es. F.e.ql.oires a.nalf.>.ls of la:1d5ca~ir,g plOir,$ fc,r r.e',. ceve':.cp=e,.::; i:-.5;e:.::ic:1; c.:-Jd a!'.~,ual a",citing arld .:-eporting of ... ·Ater L.5e. Assumed responsibility for c£'Qoving dead a"i!ll=:ls frOQ jurisdictirJn .. + ... n CO· .. lf:ty ciscorLtin;':'ed this service. ImposES [ilte limits for cornpl~ting dE':slojJiT,ent revie· ... pcoce~s, track~:1,gj reponing.. Increases monitoring, reporting, ne .... req1.!i;:e~~r:t.5 for .bandoning .... 10115; requires -caotdir.a.::f.on 'With \o1ate"t" district. • ____ -__ -L... - -. ...... -;:. -~f+'" , • : ~ '"c.;-',:-> EXHIBIT C STATE ........ '0 FEDERALl'>lANDATES California Environmental Quality Act requirements ."-Ii. 939 (v';Qste reduction, public cdu;nticn, annual reports, SOl.Lr-ce rr:du~t:r:n and recyding element etc.) Clean A.ir Act req\.Oirements Cl~a.n V,.."al.er Act requirements Non-point SullrCB (NPRS) requrrernent5 'rraffic regulation.s (bridl:e seismic retrofit, signs:, traffi;: pBmt et~.) H.aza:rdous r,fl8teria1s stora:ge Hazardous mat.erials noticing Stricter buHding codes Lar,ci:5.lj regtuations Regional Water Qu.lity Board FuJI disclosure laws and require::o.~nts Am.encan.s ... ith Disabilities Act Ci,'il Right. Ac~ of 1991 Medicar-e t.a.x on local g.ovemment employee!! Fail" Labor Stsnderde Act (FLSA) County charge for property tax collection County charge for booking fees SinglE! Aurut Act requirements G .. overnmental Accounting Standards: Board (GASB) 3CCDunti..nglaudit :CPC'It::-J5 requirements Deaf telet)'Ile equipment Marijuana records r~quirt'ments Moton6t.s assistance requirements Di:lmestic .. -iolellce diversian requirements. Dorn~stic vio!en,e information requirelner.t..s z"USSiij,g pe!'.50n repurt requirement9 Business k;.x reporJng requirements School crossmg gua..d$ AIDS te. tin g Firefighters' cancer pre3umption for work e-rs compensation Structural and wildiand fireflghter8 safaty cl othiug 81",d !.'q!J:pru('n~ Regional hou6ing need det.erminatio;lS Investxnent reporting .. Fingerprinting cIassmcation Drug/narcotic destruction Firearm dj,posal Incineration of bioha.z.ardou3 waste Mandated tralning and reportinG' Unl(oiUl crime reporting '~:-~.;<.'r-.' .... . . " '·~f-'-," ___ "'''''t:,~""",,,,-., - Rloccrds ret.entian .snd de.stnJctiG-D ReCllrd s~&ltne (or jL.lvenil-e:i Tempo~aI)' rest.z-aining orders Child abt!se repmiing Impound reports tD DeparUn~n~ of Justice Vi.:J!ent crim(! eenio!"" citizen rcportine Dep3rt.roent qf Ju.slice audits of cnmi.n2! }-jstcry a.:.cess Updating criminal hi.tory fil •• Public R..3c~rds Act r~quicements Marijuana purge record requ.iremen~ Arrest data fingerprint UU'os Monthly arrest registus Jail records Property/evidence hAndling Arson offender regi.stratior:. NS't"CQtlc offender registration Sex.ual assa1Jlt eX8Jllinations Sex Clffender reg1ittration Sudden infant death /i)"TIdrOlllE: (SInS) trai.n.in~ ChetJ:llcal agent rec;:uircrntnts !-fentaUy ill requirements First Bid CPR reQ.uirements Traffic ac.ddent in"ut.ig-stion reqwremects Wiretap investigation reqwrements Per .. onmd file req1.l..irements Polygraph exa.mi.nation requiremc-nt.s ~cycling requirements OSHA reruJ.a.ti 0'" Expansion ofworki!rs OJm'p~nsstiDn bt:nefit.!3 Underground ga.oline tank rogulations Providing retirement'; syst€m for part·tirr.e em:;:;lcyees Medfly ''''POngO Smof certi.f.cation Unemployment insw--ance for employees Emergency preparedness requirem.ents Diee.eJ use t.ailt Alternatives to banned pesticides Gas tax re-portine-requiremezHs Increased sewage treatment requiremcnta Injury Loss and Prevention ProgTB.n1 r<Jquirempnt" Hazardous materials disposeJ requirements Animal control Emergency medical training programs eraS! B dri\'era license requirements -'liepalitis B requirements /B!oodbome pathogen standards .7t ..... ;;: _,r. ~~--~~-~~--'" Sa!et)' equipment Child dsycare certification Physi>:al"and tub.:!!"cutosis c.e:rtificate~ fer.c.J[ daycare employees Finger pnntir:.g and crimi..'1a.i clearances for all aaycare E:rnpioyees with Department of Justice and FB L Parent education programs (011;' daycare families 911 di'patciIing Pnsone'r booking feas Crime Isb testinf ChHd abuse medical exn:ms Pro~erty tax administration Open meeting act • ~ .• " ! ~ I ~l ! , , ! Q OF PALO ALTO, STATE BUDGET IMPACT CIrY Actions by the State are steadily eroding the City's revenUE baze. .. I .- S t.a.~e Budg~ t If:lpa::t IS • Po! rcent of CilY of Palo Alll.' Ge~ral F...::-.d Re'''~l'll,l<!s STATE BUDGET IMPACT ON PALO ALTO ($i1Uni~) 1 ~9,)-91 1991-92 1 ~9'2·93 199I-92- SB2S57; a.~·.ir:g Fees (C.3) (0.3) <0.4; Propc:r1), Tu Admini~traliOr1 (0,1,1 (Cd) (0.1) CIgarette Tax (0.1) (Q.l) 50!i of Fines Md Forfeitu~ (non-parking) lO.!) (D.I,l Sales Tax OJ] SnOlcls, el at 0.2 0.2 01 1922-9 3: 9'jt Prop::r1~' Tn Rt0..u::-tio{! [C.7) Ir,:-r~ Bcoking F~s (SBi559J -0. 1~93-9':; Proposed 4S'ii Prop.!11), Ta:~ Reductiun -= -= -= Total Stale Bud~e1 Impact (0.2) (0.4) (I.lI BESPONSI5~E ~ITY FISCAL MANAGEMENt ~ (0 4j (O.l} rO.l) {D.I) 10 ;.1 .0- Q1.' (5.1) In 1988 and 1989, the city took decisive actio!"~ to cut its operating expenses in anticipation of tighter budgets. Ov'?t" t;,;o years/ (0 positions itfere eliminated fr-oIt the General Fund, in virtually every department. The savings were nearly $1 million the first year, and ~ore than $1.7 million the second year. The City has made budget reductions in a prudent and timely mar.ner to respond to both economic conditions ana. c:ctions by the State, and has absorbed millions of dollars of additional mandated spending. -. - MANDATED EXPENDITURES On. top of the lost revenue; the City finds itself funding more and more mandates from other levels of govs.rnment. NO Ir.atter ho'iJ 'Worthy each individual program may bel cure.ulath·ely these r;andated expenditures add to existing budget pressures and restrict. the City's abiIit~i to direct resources and deliv~r services. C "-" "--------------- Mandal~ E:.p<"ndlturtS Ci!}' "'Palo Ali'-' "" " .- A'-1Iericans ,\(U,h l)isabi 1 it,i,es Act (AD}.,: The City expects to spend at least S 1 :million over the next three years to cC;:"Fly -~ith the federal ADA. Social Security Taxe'3 __ ....f..gr Ternporaa Er.-,oloyee-s: Recent fedentl le.gislatio::l requi:es cities to pay social security taxes for all tEn.pcrar:r· e::.ploys:::s. The ;Idded cost to Palo Alto is !nore thaij S150,OOO per year. Palo Alto R~sj.onal Wa;tter C1ua)ltv Ccn.t:r-qJ, ___ ?l2:nt Standar9_.§.! With fi.ve pc:::·tne:-- jurisdictions, the City o~ns an~ operatEs a ~ater tre3t~e~t plant. I~ 1537 the Plant .... on EP}'~' 5 natic:1al a',,'-ard for "Cp.erations ar,Q Mai!l+:er.p.:,co: E:-:c€:l­ lencs" over every large trea-:rne.~t plant in tr..e cou!",try. Yet~ the ver-y next year, the state and regional ""·ater quality control boards imposed additional permit requirements for source control , _monitGring and studies that aC::l~:j $1.5 milliQn in annual costs and six new positions. since then, ~ore per~it amendr!1.ents have added five fu:rther positions and $0.5 million per yecl". ~~ste J.!ini!TJiza~ior. (A8939}! Approxir.:ato:!y $.7 million .... 'as budgeted i::. 1992- 93. and costs over thoP. next ten years are. proj ected t:o reach $9.0 mill ion. Landfi 11 Cl_osure and_post-clos:L1re F;nvironmenta l ____ C_~..r.g: Pays f~r stc,:e- mandated landfill closure and post-clOsl11·e envirol1:tlental care cost.s. 1991: $550,000 1993: $l~lOO,OOD Transoo_l:7_tation Demand_ ManaOE1:"iE"rlt: Approximately a quarter million dollars annually for Palo Alto's share of S2.nta Clara County ccngestion r.anageIi,.2nt agency expenses, and salary and l:enefits of a full-tir:-.e corr,mute coordinator be-::rinning in 1592. o ATTACRMEN'l' .. CITY 01" PALO At·TO: HIS'rORICAL PERSPECTIVE The 1979 wAB 6 ~~ilollt" " Altered the fiscal rei~tionship between the stat~ and local governments, given cities' fiscal independence state Actions After AB 8 o o o o Half of cities' cigarette tax taken away Half of vehicle citation fees takeo away Charges by county for property tax collection Cost to book prisoners at county j~ils The 1992 Sta te BUdget Ar::;:~.j, __ 9.ns o CUt remaining cigarette tax revenue o Cut 9\ of General Fund property tax revenue ImpositjQn of state Mandates o Mandatory solid waste reduction SUBTOTAL: Impact of State Action Since AS 8 ThJLFuture o Governor's prcposed 21.7% property ta~ cut TOTAL IMPACT ON CITY: $3rOOO~OOO ( 50,000) {lSD,ODD} (120,000) (380,000) ( 60,000) (855,000) (970,000) (2,595,000) (1,774, DOD} ($4,369,000) Source: Report of Santa Clara count::r" Cities AS50ciatici n Legislative Task Force .~ .