CITY OF MENLO PARK PROPOSED BUDGET FISCAL YEAR

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1 CITY OF MENLO PARK PROPOSED BUDGET FISCAL YEAR

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3 City Manager s Transmittal Letter From Vision to Fruition Dear Honorable Mayor Ohtaki and Members of the City Council, It is my pleasure to present to you my seventh proposed budget for the City of Menlo Park. The budget is a $ million spending plan that implements the City Council adopted work plan, enhances service levels to the community, and transfers additional monies to help fund future capital improvement needs. The theme of this year s budget is From Vision to Fruition which reflects an enviable financial position where the community begins to experience the fiscal benefits of key land use decisions. From the Park James Hotel and the Hotel Nia, to approved development plans for long vacant lands along El Camino Real, the community s vision is coming to fruition. With that said, I urge the City Council to continue its tradition of fiscal prudence by taking advantage of this new fiscal condition to plan for the many projects desired by the community as outlined in the City Council adopted work plan and the Capital Improvement Plan. FISCAL YEAR IN REVIEW Fiscal year was a very productive year. As of the preparation of this budget, the finance division estimates that fiscal year will end with a surplus across all funds. Notwithstanding the surplus, the following highlights some significant accomplishments in fiscal year that reflect the theme of this budget From Vision to Fruition : Issued occupancy permit for the Hotel Nia. Completed renovations of the Belle Haven Child Development Center, Karl E. Clark Park, and Nealon Park allowing for greater access and use of the facilities. Completed renovations of the Belle Haven branch library and added 13 hours per week to the branch library including Saturday and Sunday hours to better serve the community. Installed a new communication antenna to strengthen reliability of communication tools for law enforcement officers. Completed the establishment of districts for City Council elections beginning November Completed a comprehensive employee engagement initiative and developed a road map to improve the City s standing as an employer of choice. Installed a bus shelter in the Belle Haven neighborhood. Expanded the herbicide free parks program. FISCAL YEAR BUDGET SUMMARY The proposed fiscal budget provides for a $ million spending plan inclusive of operations, new capital improvement funding, and carryover capital improvement funding for 48 different funds. The General Fund is the City s single largest fund and provides for the vast majority of services to the public including planning, building, engineering, police, library, and community services. The proposed General Fund budget for fiscal year anticipates revenues totaling $67.54 million and expenditures totaling $67.44 million resulting in a surplus of $0.32 million. CITY OF MENLO PARK BUDGET I

4 City Manager s Transmittal Letter The City s five year capital improvement plan requests a total of $17.37 million of new funding with the most significant investment occurring in City buildings and systems, streets, sidewalks, parks and recreation, and water infrastructure. FACTORS INFLUENCING THE BUDGET The single largest element influencing the fiscal year budget is the robust local economy. On the revenue side, the City continues to experience healthy growth in its largest revenue source, property taxes. Additionally, the opening of Hotel Nia in April 2018 and the planned opening of the Park James Hotel in July 2018 generate new structural revenue for the City. Finally, the City Council s decision to eliminate taxpayer subsidy of most private development projects through the adoption of the master fee schedule rounds out the most significant changes in General Fund revenue. These changes are dependent on a healthy economy and there are no indications of slowing in development or hotel occupancy taxes in the next twelve months. Just as the robust economy is fueling growth in City revenues, it is also influencing expenditures. As a service organization, the City s most significant expenditure category is personnel. The strong economy has resulted in near zero unemployment for the region and the City is in fierce competition for talented staff. In response to this pressure and the impact vacancies have on the City Council s adopted work plan, the City Council reached multi-year labor agreements with three of its four bargaining units and is in active negotiations with the fourth unit. These labor contracts allow for greater certainty in costs when developing this budget. While the labor contracts provide the City with greater certainty over its own costs, the impact of a tight labor market is now influencing increased costs in contract services. Over the past several years, the City s use of private sector service providers to meet the needs of the community helps to offset the need for increased headcount. As many multi-year service agreements expire, the strong economy is resulting in significantly higher cost for those services. In some cases, the City s bids go unanswered by contractors. CITY COUNCIL ADOPTED WORK PLAN To launch budget development, the City Council adopted its 2018 work plan in February 2018, with 59 initiatives. In this year s work plan development session, the City Council took the bold move to prioritize the following six projects for priority progress in District elections Transportation master plan Citywide Safe Routes to School Program Implement Downtown/El Camino Real Specific Plan Biennial Review Downtown parking garage The Guild Theatre The full work plan is attached to this transmittal. I have committed to the City Council that we will make measurable progress on these six initiatives. Despite staff vacancies in the Community Development Department, I want to commend the Department for working closely with the Guild Theatre applicant to receive the land use entitlement approvals necessary for the project to move forward. Yet another example of the community s vision coming to fruition. EMPLOYEE ENGAGEMENT: MENLO PERK A dedicated, engaged and qualified work force is critical to the delivery of quality services to the community. In summer 2017, I sensed that the City s work force was experiencing pressures that would eventually compromise our ability to do good work for the community. I directed a team of staff members to explore the state of our workforce and return with tangible recommendations on how to avoid additional loss of staff capacity. As a result of the team s work and extensive engagement with the whole workforce, we recently completed development of the Menlo PERK initiative. PERK stands for Plan, Engage, Recognize and Konnect and represents the City s effort to improve employees connections to one another, the organization and our shared mission and values. The process to develop the plan collected over 1,000 strategy ideas from employees on how to address the five initial areas of concern that arose out of the 2017 employee engagement survey which included: opportunities for input, appreciation and recognition, work-life balance, change management and communication. Those strategies have been refined into the PERK Action Plan that staff will begin to implement fully in the new fiscal year. Examples of strategies that will be undertaken include job shadowing, process planning standardization, on-site training opportunities and improved internal communications. II CITY OF MENLO PARK BUDGET

5 City Manager s Transmittal Letter BUDGET PRINCIPLES In addition to the work plan, the City Council adopted budget principles to guide the development of this proposed budget. The City Council originally introduced them in the fiscal year budget. In February 2018, the City Council reaffirmed these important foundational principles and further refined the presentation of into four primary areas: Promote the City s long-term fiscal sustainability through: Monitoring and reporting on changes in pension liabilities and including those changes in the City s long- term forecast Incorporating a budget assumption for employee vacancies and resulting salary savings into the forecast Active pursuit of revenue enhancements and striving to achieve full cost recovery for all fee-based services, except where the City Council sees a clear public interest in providing a subsidy Enhance and maintain core City services and infrastructure by: Prioritizing City Council adopted initiatives and strategies that contribute to the quality of life in Menlo Park Evaluating one-time revenues for highest and best investment Recognizing the benefit of leveraging near-term investments for long-term gains in financial sustainability and/or quality of life Manage staff capacity to efficiently deliver services to the community via: Investment in new technologies that drive efficiency and productivity Incorporating programs and initiatives that strengthen Menlo Park s standing as an employer of choice to retain and attract highly qualified personnel Proactively managing the loss of institutional knowledge through succession planning efforts including the ability to provide for overlap in critical positions at the discretion of the City Manager Communicate the City s financial position by continuing to refine the budget document to enhance the public s access to the City s financial information while also providing for proper internal controls over the City s resources BUDGET ASSUMPTIONS It is imperative for city governments to use financial resources effectively and efficiently. City resources must be channeled to meet the needs and interests of residents while also balancing investments in the future. Menlo Park has traditionally practiced prudent budgeting. That is, revenues and expenditure estimates are conservative within the range of potential outcomes. The coming fiscal year will be no exception. I do not anticipate the need to look to reserves to balance this year s budget and remain confident that, despite our increasing service level demands, revenues are sufficient to meet operational needs. CITY OF MENLO PARK BUDGET III

6 City Manager s Transmittal Letter Major revenue assumptions include: Another year of strong growth in property tax base Increases in transient occupancy taxes resulting from the addition of two new hotels: Hotel Nia and the Park James Hotel Half funding of the excess ERAF revenue ($1.10 million in property taxes) Maintaining the Utility Users Tax at the current reduced level of 1 percent Continued strength in development activity Strong cost recovery in service providing departments Carrying over capital improvement plan appropriations previously approved. Major expenditure assumptions include: Known compensation and benefit adjustments, including successor agreements for the majority of the City s collective bargaining units and updated pension obligations as a result of CalPERS recent assumption changes An overall vacancy factor of 4.2 percent acknowledging that an organization with FTEs experiences unanticipated turnover during the course of the fiscal year which results in salary and fringe benefit budget savings A contingency budget for escalating service contract costs Several service-level enhancements intended to restore and augment service levels to the community FINANCIAL SUMMARY The fiscal year budget, across all funds, outlines a spending plan totaling $ million. To fund this plan, fiscal year revenue and other resources across all funds, totals $ million. Consistent with previous years, taxes continue to account for the bulk of the revenue. The second largest revenue category, charges for services, captures fees charged to customers for specific programs or services and range from recreation classes to building permits to water service. Of particular note, is the use of assigned fund balance which primarily offsets in the Capital Improvement Plan budget. IV CITY OF MENLO PARK BUDGET

7 City Manager s Transmittal Letter All Funds Revenue $ millions Use of assigned fund balance Taxes $47.29 Charges for services Taxes Permits and licenses 8.30 Intergovernmental revenue 4.38 Franchise fees 2.05 Other 3.07 Use of assigned fund balance TOTAL $ Transfer from other funds Other Permits, licenses, intergovernmental Charges for services Utilities All Funds Expenditures by Category $ millions Transfers & other Salaries and wages $33.25 Fringe benefits Operating expenses and utilities Contract and professional services Fixed assets and capital outlay Transfers and special projects Operating expenses Services Benefits Capital (incl. carryover) Other 1.60 Salaries Carryover capital improvement appropriations TOTAL $ The proposed fiscal year budget includes full time equivalent (FTE) personnel, an increase of 9.25 FTEs compared to the fiscal year amended budget. The new personnel are necessary to improve service and maintain service to the community in the Public Works, Police, Library, Community Services, and Administrative Services departments. The proposed fiscal year budget, similar to the prior fiscal year budget, also includes use of assigned fund balance and carryover capital appropriations to account for the substantial Capital Improvement Plan approved by the City Council over the past several years. The reason to include the carryover capital appropriations in in recognition that the City is managing a number of projects above and beyond those approved in the current fiscal year budget. Carryover capital appropriations are projections and include both encumbered and unencumbered project funds. This is a more accurate representation of the budget because the City Council has historically amended the adopted budget to reflect encumbrance carryovers in December of January of each year. Inclusion of the estimated carryover appropriations provides a better sense of the City's true expenditure plan in the subject fiscal year. It should be noted that the projected carryover appropriations displayed in many of the CIP budgets may not necessarily reflect monies that are available for use. CITY OF MENLO PARK BUDGET V

8 City Manager s Transmittal Letter SERVICE-LEVEL ENHANCEMENTS & NEW BUDGET REQUESTS Consistent with the City Council Work Plan and to meet service level needs of the community, the fiscal year budget includes several service-level enhancements to benefit the community. In summary, the budget includes an increase in the General Fund budget totaling $2.35 million, an increase in the Water Fund totaling $0.21 million, and an increase in the Landscape Assessment Fund totaling $0.43 million, including the more noteworthy enhancements: Peak Workload Contract Staffing $507,000 An increase in contract staffing budget allows the City to meet demand which is anticipated to be inconsistent and to complete high-impact, discrete projects without adding permanent staff including extra support for land management. Funds will allow for organizational reviews of the Community Development and Public Works Departments, ensuring that the services provided and staffing level and mix are consistent with the needs and expectations of the community. In addition, the Planning Division will use funds to support the biennial review of the Specific Plan through research, drafting of proposed amendments, preparation of required environmental documents, and legal support. The Building Division will use contract service funds to meet the temporary demand created by several large development projects requiring inspection services but which are not anticipated to need permanent staff. The Finance Division will utilize funds to prepare Requests for Proposals to lower overall cost of services to the City as well as to consult for process improvement initiatives. Escalating Contract Services Cost Contingency $615,000 As a result of the economic prosperity of the area and the conclusion of several multi-year agreements that the City had for contracted services, the budget includes a contingency for escalating cost of contract services. Agreements up for renewal which are expected to be more expensive than prior years include janitorial services, street repairs, street sweeping, pool operations, and flood and storm drainage maintenance operations. This budget amount represents a reserve which allows for the completion of agreements for services but which will be unspent to the extent that increased service costs do not materialize. New Construction Inspector position to process Land Development projects $140,000 The Public Works Department adds 1.0 FTE Construction Inspector to meet workload requirements due to the pace of development. Projects in the Bayfront and El Camino Real/Downtown areas are requiring a significant increase in capacity for inspections of public right-of-ways. This addition ensures that the City can continue to monitor construction activities, affirm that standards are being upheld, and mitigates the effect on the community from construction projects. New staff to enhance Code Enforcement and Public Safety Dispatch services $182,000 This enhancement includes the addition of 1.0 FTE Code Enforcement Officer to address the backlog of over 100 pending citizen reported code enforcement cases. Tasked with investigating municipal code violations and quality of life issues throughout the City, increased development in recent years has necessitated the addition of capacity in this role in order to ensure that the numerous, often complex calls for service are handled in the time frame that residents and businesses expect. The Police Department is also requesting the conversion of an existing half-time dispatch position to a full-time status. The Department has been unsuccessful finding a qualified individual interested in work half-time despite repeated recruitment, necessitating the use of temporary per-diem dispatchers. The additional provides resources to mitigate the workload increase resulting from the creation of a patrol beat. VI CITY OF MENLO PARK BUDGET

9 City Manager s Transmittal Letter Library Staffing Model update $191,000 In the first year of a two-year phase-in, the Library Department adds 3.0 FTEs in an effort to reduce its reliance on temporary staff and increase the consistency of service provided to the community. The first year of implementation includes the addition of one Library Assistant and two Librarian positions, focused on Administration, Youth Services, and Adult Services respectively. This change simultaneously reduces the complexity of using a large number of temporary staff and increases the level of service provided to the community. Belle Haven Holiday Lighting $25,000 The previous contract agreement for holiday lighting is limited to the Downtown area and the City received multiple requests to install lighting in the Belle Haven Neighborhood during the 2017 holiday season. This enhancement includes electrical access assessment, installation, and operation of holiday lights on trees identified at the Onetta Harris Community Center for the 2018 holiday season. Expanded Downtown Sidewalk Power Washing $50,000 Regular downtown activity plus outdoor seating has resulted in an increased need for services to maintain the aesthetics of the area and decrease health concerns related to sidewalk cleanliness. This enhancement includes six additional power washing services per year in the Downtown area. Currently, Downtown sidewalks are power washed only twice per year, and these additional six services will provide monthly cleaning during the summer months (May through September) and every other month for the remainder of the year (November, January and March). Library Program Augmentation $88,000 Increased funding for the Library Department supports a number of initiatives which continue to build upon previous years of service and which set the stage for continued service into the future. Funding supports Project Read which has a proven record of providing literacy programming to the community and whose previous funding sources have declined throughout the years. Funding also supports a variety of other programming including storytellers, musicians, scientists, and artists as well as increased use of the Performing Arts Center. Finally, funding will support the extended weekend hours for the Belle Haven Branch Library by providing additional cleaning services not currently covered under the service agreement. Hazardous Tree Removal $80,000 As a consequence of years of drought, the trees growing along streets and in parks have experienced tremendous stress that has compromised their health. Staff has found that trees are weak and more susceptible to secondary pests and disease as a consequence, increasing the risk of failure and danger to the community. The proposed budget includes $80,000 in contract services in the Public Works budget to mitigate unfortunate consequences of the drought. CITY OF MENLO PARK BUDGET VII

10 City Manager s Transmittal Letter Municipal Water Service Reliability and Maintenance Staffing $213,000 In the second year of a two-year phased implementation which began in March, 2017, the Public Works Department adds 2.0 FTEs to improve maintenance efforts of municipal water service infrastructure. Consistent with findings presented to City Council in the Water System Master Plan, addition of two positions will fully staff the water system. The positions are fully funded by water ratepayers and represent no burden on the General Fund. CAPITAL IMPROVEMENT PLAN BUDGET The Capital Improvement Plan budget is a multi-year plan to replace or extend the useful life of the City s infrastructure such as roads, parks, buildings and water mains. When the City Council appropriates funds to pay for a Capital Improvement project, any unspent funds at the end of each fiscal year are automatically carried over to the next fiscal year so that staff can continue their work on the project. In this year s budget, a cumulative total of $29.96 million in carryover appropriations is reflected as a resource in use of assigned fund balances and as a requirement in the Capital Improvement Plan carry-over. In addition to carry-over appropriations, the Capital Improvement Plan budget includes $19.51 million of new funding for new projects including: Street resurfacing project ($4.20 million) Middle Avenue Caltrain crossing study design and construction ($1.10 million) Pierce Road sidewalk and San Mateo Drive bike route installation ($1.01 million) Annual Aquatic Center maintenance ($0.40 million) Willow Oaks Park improvements ($0.38 million) Electric Vehicle Chargers at City facilities ($0.20 million) Belle Haven Youth Center improvements ($0.20 million) Water system improvement projects - multiple totaling $5.85 million The Capital Improvement Plan section of this document provides descriptions for these and all other capital improvement projects, including carry-over projects from prior years. An important component of the Capital Improvement Plan section is the fund-by-fund summary section which outlines the five-year financial health of each fund. As demonstrated in that section, certain funds have funding needs in excess of the revenue, resulting in a demand for outside funding, if available. If outside funding through grants or rate adjustments is not available, the City may need to use of General Fund monies to complete the project. The following list outlines some of the largest non-utility projects: Ravenswood Avenue/Caltrain rail crossing ($25.00 million) Street resurfacing project ($15.20 million) Middle Avenue Caltrain crossing construction ($9.90 million) Downtown parking utility undergrounding ($5.50 million) Information technology master plan implementation ($5.00 million) Parking Plaza 7 and 8 renovations ($4.40 million) Bedwell Bayfront Park master plan implementation ($4.00 million) Park pathways repair and improvement ($2.00 million) Sport field renovations ($1.20 million) Park playground equipment ($1.05 million) While the projects above total $73.50 million over five years, certain funding sources are available to meet some of the need. That said, the Funds that support the projects above are expected to have a funding requirement of $44.64 million through the five year plan. As the City realizes surpluses in the General Fund, those funds may be used to offset a portion of the future funding need. Not mentioned above are additional projects that have been identified but have yet to mature to the point of City Council direction to move forward. These projects include a new Emergency Operations Center (EOC) and mobile EOC/command vehicle; Library System Improvements including new main and branch libraries; Onetta Harris & Senior Center Complex rebuild or expansion; Belle Haven pool improvements or replacement; and implementation of the Parks and the Recreation Master Plan. Each of the aforementioned projects reflect needs that currently have limited or no funding. VIII CITY OF MENLO PARK BUDGET

11 City Manager s Transmittal Letter STRATEGIC LONG RANGE PLAN In keeping with this year s budget theme From Vision to Fruition, the City Council s prudent fiscal practices require a ten-year forecast to understand the City s long range plan and the ability to pay for items outlined in the previous section. In large part due to the Mayor s request that the Finance and Audit Committee refine the City s strategic long range financial plan, staff utilized uncertainty modeling to develop the 10-year forecast for this budget cycle. The uncertainty model allows for the generation of multiple potential outcomes rather than a single mid-point estimate for each year. Using this model, staff created a range of scenarios which accounted for known events, such as financial terms contained in development agreements, as well as unknown events, such as an economic downturn and subsequent recovery. A total of 1,000 trials were run to generate a distribution of potential outcomes. The table and chart below summarizes the weighted average of all scenarios and reflects the most likely outcome based on a number of inputs. While the uncertainty model has generated a data point for the City Council to consider when making decisions, staff emphasizes that the City Council should not rely solely on the forecast as a basis for decision making. The model outlines a favorable financial condition for the next ten years. As mentioned in earlier sections, however, the City has a number of needs that will far outpace the favorable surpluses anticipated over the next ten years. General Fund 10-year Forecast $millions Surplus/(Deficit) $0.42 $4.24 $3.67 $2.57 $2.79 $2.40 $2.10 $2.27 $3.62 $4.11 $5.54 Operating revenues, expenditures, and net revenue $ million Revenue / Expenditures $4.24 $3.67 $2.57 $2.79 $2.40 $2.10 $2.27 $3.62 $4.11 $ Surplus / (deficit) $ proposed OPERATING REVENUES OPERATING EXPENDITURES NET REVENUE CITY OF MENLO PARK BUDGET IX

12 City Manager s Transmittal Letter FROM VISION TO FRUITION The community s vision of the future is coming to fruition and has resulted in a favorable financial position for the City s General Fund in fiscal year and going forward. The budget and analysis in this document reflects staff s best estimate of revenue and expenditures based on information available as of the budget preparation. Staff is mindful that changing economic times can impact key revenues, such as transient occupancy taxes, and staff closely monitors these revenues for early warning signs that may require corrective action in the City s budget. While the community s vision of the future is a culmination of engaged residents and active business partners, current and past City Council deserve the credit for decisions that have resulted in significant achievements and the City s financial stability. In addition, the Finance and Audit Committee has worked closely with staff to identify areas of improved financial communication such as the revised 10-year forecast model to help the City Council and community make decisions about unfunded obligations such as pension and capital improvements. Each year the budget requires a significant amount of staff resources to present the community with a document that is informative and accessible. While staff makes incremental improvements to achieve their goal every year, it is noteworthy that the excellent work of the budget team last year was recognized by the Government Finance Officers Association with the Distinguished Budget Presentation Award. This was the first year the City received this award and a credit to the fine team of staff who contributed to the document s creation. For this proposed budget, I want to offer special thanks and appreciation to all staff who contributed to the production of this document. I would like to acknowledge the City s Management Team for their conservative and pragmatic approach to their budgets. Most notably, however, I would like to thank the budget team comprised of Administrative Services Director Nick Pegueros, Finance and Budget Manager Dan Jacobson, Management Analyst I Brandon Cortez, Public Works Director Justin Murphy, Assistant Public Works Director Nikki Nagaya, City Engineer Azalea Mitch, and Public Works Business Manager Eren Romero. The budget team, in coordination with key budget personnel in each operating department, worked tirelessly to compile this budget for your consideration. Lastly, I want to acknowledge our dedicated employees, many of whom commute sometimes hours each workday to provide exceptional service to the community. Without their hard work, nothing in the document to follow would be possible. Respectfully submitted, Alex D. McIntyre City Manager X CITY OF MENLO PARK BUDGET

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14 City Manager s Transmittal Letter City Council Work Plan Project Summary Lead Department Supporting Departments PRIORITY PROJECTS (AS APPROVED ON FEBRUARY 6, 2018, AMENDED ON MARCH 15, 2018) District Elections Menlo Park is transitioning to a by-district election system effective for the November 2018 City Council election. Demand for election-related staff support is expected to be higher than normal. City Manager s Office - Transportation Master Plan The Transportation Master Plan provides a bridge between the policy framework adopted within the Circulation Element and project level efforts to modify the transportation network within Menlo Park. The Plan, when completed, would provide a detailed vision, set goals and performance metrics for network performance, and outline an implementation strategy for both improvements to be implemented locally and for local contributions toward regional improvements. Following development of the Plan, a fee program update would provide a mechanism to modernize the collection of funds toward construction of the improvements identified and prioritized in the Master Plan. Public Works City Manager s Office, Community Development, Police Citywide Safe Routes to School Program (Non-infrastructure) Safe Routes to School typically encompasses six program elements: education, encouragement, enforcement, equity, engineering and evaluation (6 E s). The development of a Safe Routes to Schools program would establish a partnership between the City, local schools, and parent groups to ensure issues that discourage students from walking and bicycling to school are addressed. This program would establish a stakeholder group to work collaboratively on Safe Routes issues and solutions, develop incentive and encouragement programs, and outline the framework to build and sustain the program over time. This program would not construct or fund infrastructure improvements, although it would establish a staff liaison to identify infrastructure needs within other capital project planning processes in the City. The Citywide Safe Routes to School Initiative (noninfrastructure) is an ongoing, multi-year program that will require annual funding. Public Works Police Implement Downtown/ El Camino Real Specific Plan Biennial Review Commence the Downtown/El Camino Real Specific Plan Biennial Review and initiate associated amendments, which may encompass the following items: Revisions to the residential and commercial maximum allowable development levels, modify existing floor area ratio (FAR) and height limits in applicable zoning districts, potentially modify zoning to permit a mixeduse parking facility and possible revisions for the following: required setbacks and sidewalk standards; hotel, personal service and transit station area parking requirements; sign area requirements for larger parcels; and a hotel incentive analysis. Completion of this work with require the retention of a private consultant to assist City staff. Community Development City Manager s Office, Public Works XII CITY OF MENLO PARK BUDGET

15 City Manager s Transmittal Letter City Council Work Plan Project Summary Lead Department Supporting Departments PRIORITY PROJECTS (AS APPROVED ON FEBRUARY 6, 2018, AMENDED ON MARCH 15, 2018) Downtown Parking Garage Determine potential uses, siting, funding and design of a downtown parking structure. Staff has evaluated a number of options for developing a parking structure and/or mixed use development. With that in mind, there is no consensus yet regarding the mix of uses, siting, funding strategy and design of a parking structure. Staff will research options for presentation to City Council with the known limitations and schedule a community meeting in March to pose these question to the business community, residents and other stakeholders and then report out to the City Council in a study session to be scheduled in April. City Manager s Office Administrative Services, Community Development, Public Works The Guild Theatre - Land Use Entitlement Approval Complete the approval of the necessary entitlements for the Guild Theatre. The proposed reuse of the Guild Theatre, by a private non-profit developer, will require an amendment to the El Camino Real/Downtown Specific Plan. The proposal is to renovate and expand the current facility as a live entertainment venue for music acts, while also allowing for periodic film showings and community events. The facility would be a three-level (finished basement) 11,000 sq. ft. structure. Staff will retain a consultant to identify a new use definition, modify permitted floor area ratio (FAR) for the new use and determine if additional environmental review would be required. Additional analysis would be required for traffic, parking, and historic assessment. The developer would be responsible for construction and operation of the facility. Community Development City Manager s Office, Public Works CITY OF MENLO PARK BUDGET XIII

16 City Manager s Transmittal Letter City Council Work Plan Lead Department Supporting Department(s) PRIORITY PROJECTS (AS APPROVED ON FEBRUARY 6, 2018, AMENDED ON MARCH 15, 2018) Responding to the development needs of private residential and commercial property owners Enhanced Housing Program City Manager s Office Community Development, City Attorney s Office Revisions to the 2016 California Green Building Standards Code for Electric Vehicle Chargers Community Development - Single Family Residential Requirements and Guidelines Community Development - Stanford University 2018 General Use Permit Review Public Works Community Development, City Attorney s Office Attracting thoughtful and innovative private investment to Menlo Park Downtown Streetscape Improvement Project (Specific Plan) Public Works City Manager s Office Furthering efficiency in city service delivery models Cost allocation plan and user fee study Administrative Services All other departments Development of a Citywide Communications Program City Manager s Office All other departments Information Technology Master Plan Implementation Administrative Services Community Development, Public Works Organizational Study of the Public Works Department City Manager s Office Public Works Organizational Study of the Community Development Department City Manager s Office Community Development, Public Works Charter City Initiative City Attorney s Office - Employee Engagement/Organizational Development All - West Menlo Triangle Annexation (Subcommittee - information gathering) City Manager s Office Community Development, Public Works Improving Menlo Park s multimodal transportation system to move people and goods through Menlo Park more efficiently Haven Avenue Streetscape Improvement Public Works - Create Transportation Management Association Public Works - High Speed Rail Coordination & Environmental Review Public Works City Manager s Office, Outside Legal Counsel Oak Grove, University, Crane Bicycle Improvement Project Public Works - Willows Neighborhood Complete Streets Public Works Police El Camino Real Corridor Study Public Works - Middlefield Rd/Ravenswood and Ringwood Avenues Traffic Signals Modification Public Works - Willow/101 Interchange Public Works Police Chilco Streetscape and Sidewalk Installation Public Works Community Development Ravenswood Avenue/Caltrain Grade Separation Study Public Works - Middle Avenue Caltrain Crossing Study Public Works Community Development XIV CITY OF MENLO PARK BUDGET

17 City Manager s Transmittal Letter City Council Work Plan Lead Department Supporting Department(s) PRIORITY PROJECTS (AS APPROVED ON FEBRUARY 6, 2018, AMENDED ON MARCH 15, 2018) Maintaining and enhancing Menlo Park s municipal infrastructure and facilities Burgess Pool Capital Improvements Public Works Community Services City Buildings and Systems HVAC Modifications Public Works Community Services Gatehouse Fence Replacement Public Works - Facilities Maintenance Master Plan Public Works Community Services Reservoir Reroof and Mixers Public Works - Library Landscaping Public Works Library Water System Master Plan Public Works Administrative Services Chrysler Pump Station Improvements Public Works - San Francisquito Creek Upstream of 101 Flood Protection Project Public Works City Manager s Office Emergency Water Supply Public Works - Providing high-quality resident enrichment, recreation, and discovery Parks and Recreation Facilities Master Plan Update Community Services Administrative Services, Public Works Park Playground Equipment Public Works Community Services Jack Lyle Park Restroom Public Works Community Services Willow Oaks Park Improvements Public Works Community Services Burgess Park Snack Shack Community Services Community Development, Public Works Equity in Education Joint Powers Authority City Manager s Office - Minimum Wage Ordinance City Manager s Office Economic Development Realizing Menlo Park s vision of environmental leadership and sustainability Green Infrastructure Plan Public Works - Update the Heritage Tree Ordinance City Manager s Office Community Development, Public Works Community Zero Waste Plan Implementation City Manager s Office Administrative Services, Community Development, Public Works CITY OF MENLO PARK BUDGET XV

18 City Manager s Transmittal Letter City Council Work Plan Lead Department Supporting Department(s) PRIORITY PROJECTS (AS APPROVED ON FEBRUARY 6, 2018, AMENDED ON MARCH 15, 2018) Planned Capital Improvement Projects Bayfront Canal and Atherton Channel Flood Protection Public Works - Downtown Utility Undergrounding Public Works City Manager s Office Welcome to Menlo Park Monument Signs Public Works City Manager s Office Sea Level Rise Resiliency Plan Public Works City Manager s Office Santa Cruz and Middle Avenues Resurfacing Public Works - Oak Grove Safe Routes to School and Green Infrastructure Public Works - Bayfront Expressway, Willow Road and Marsh Road Adaptive Signal Timing Public Works - Library System Improvements Belle Haven Branch Library Improvements City Manager s Office Library, Administrative Services, Community Development, Public Works Main Library Improvements City Manager s Office Library, Administrative Services, Community Development, Public Works XVI CITY OF MENLO PARK BUDGET

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21 City Manager s Proposed Budget Fiscal Year CITY COUNCIL Peter Ohtaki, Mayor Ray Mueller, Mayor Pro Tem Catherine Carlton Richard Cline Kirsten Keith Alex D. McIntyre, City Manager BUDGET TEAM Nick Pegueros, Administrative Services Director Dan Jacobson, Finance and Budget Manager Brandon Cortez, Management Analyst I Justin Murphy, Public Works Director Nikki Nagaya, Assistant Public Works Director Azalea Mitch, City Engineer Eren Romero, Business Manager CITY OF MENLO PARK BUDGET XIX

22 Budget Acknowledgements Departmental Budget Coordinators and Contributors City Manager s Office Clay Curtin, Rebecca Lucky, Peter Ibrahim Administrative Services John McGirr, Patricia Barboza, Neetu Salwan Community Development Mark Muenzer, Ron LaFrance, Meghan Revolinsky, Vanh Malathong Community Services Derek Schweigart, Natalie Bonham, Todd Zeo, Matt Milde, Natalya Jones, Marika Kopp Library Susan Holmer, Nick Szegda Police Dave Bertini, Tony Dixon, Dani O Connor Public Works Brian Henry XX CITY OF MENLO PARK BUDGET

23 Table of Contents CITY OVERVIEW... 1 City profile...2 Organizational chart...4 Demographics...5 Budget process...6 BUDGET DISCUSSION Introduction...12 All Funds summary...14 General Fund summary...18 General Fund revenue discussion...22 General Fund expenditure discussion...30 General Fund outlook...36 Other Funds...42 Financial Summaries...48 FIVE-YEAR CAPITAL IMPROVEMENT PLAN New Funding Requests CIP Project Summary City Buildings & Systems Environment Parks and Recreation Stormwater Streets and Sidewalks Traffic and Transportation Water Funding Sources 5-year Projection APPENDIX Glossary of budget terms DEPARTMENTAL SUMMARIES City Council...58 City Attorney...60 City Manager...62 Administrative Services...66 Community Development...72 Community Services...78 Library...82 Police...86 Public Works...90 Non-departmental...98 CITY OF MENLO PARK BUDGET XXI

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25 CITY OVERVIEW CITY OF MENLO PARK BUDGET 1

26 City Overview City profile THE COMMUNITY Menlo Park is a city of beautiful, tree-lined neighborhoods and active commercial districts. Located conveniently between the major metropolitan areas of San Francisco and San Jose, Menlo Park is home to a little over 33,000 residents in its 19 square miles. The stunning natural surroundings of the city afford views of the San Francisco Bay to the east and the Pacific Coastal Range to the west. Menlo Park s climate is moderate to warm, with an average of 265 sunny days a year. Menlo Park s residents reflect a range of backgrounds and interests who tend to be well educated and actively engaged in community life. Excellent public and private schools serve its many young families, while residents of all ages enjoy the numerous city parks and recreational facilities. The city s proximity to Stanford University and Menlo College provide a multitude of academic, cultural and athletic event opportunities. The arts and leisure activities of the major urban areas of San Francisco and San Jose are close by. These and many other amenities contribute to Menlo Park s outstanding quality of life. Located in the heart of Menlo Park is a downtown featuring unique and upscale shops and restaurants. Set in a pleasant, pedestrian-oriented atmosphere, Menlo Park s downtown area attracts locals and visitors alike. Known worldwide as the Capital of Venture Capital, Menlo Park is well situated to benefit from and help shape new technologies and markets originating from Silicon Valley. The city is home to such notable employers as SRI International, the United States Geological Survey, Facebook, Pacific Biosciences, and CS Bio Co. CITY GOVERNMENT Menlo Park is a General Law City under the State of California, and operates under the council-manager form of government. The City Council appoints the city manager and city attorney as well as members of a variety of commissions and committees. The City is organized into operating departments, all reporting to the City Manager, including Administrative Services, City Manager s Office, Community Development, Community Services, Library, Police and Public Works. In addition to its many attributes, Menlo Park has one of the most beautiful civic center campuses in the Bay Area. Lush landscaping, including heritage trees, a running fountain and a duck pond, surround the City Hall/Administration Building. The campus also includes a nine-acre park, recreation facilities and the main library. These civic amenities make the campus a noted destination for residents, local employees and visitors. Conveniently located, the campus is a short walk to the Menlo Park Caltrain Station and Menlo Park s downtown retail district. The City s website, menlopark.org, is the source for information about services, programs, projects, events, meetings, policies, employment and volunteer opportunities. 2 CITY OF MENLO PARK BUDGET

27 City Overview City profile CITY COUNCIL The City Council is the five-member governing body, whose members are elected at-large to four-year overlapping terms in general municipal elections. The full City Council selects the Mayor and Mayor Pro Tem annually in December, each serving a one-year term. The Mayor, who represents the City of Menlo Park at ceremonial and public events, also serves as the presiding officer of the City Council. The Menlo Park City Council meetings are generally Tuesdays at 7 pm in the City Council Chambers located at 701 Laurel Street. Menlo Park s Councilmembers serve part-time, retaining their positions in private industry, personal enterprise, business or the professions. Employer name Total employees Facebook, Inc. 9,350 SRI International 1,300 TE Corporation 527 Abbott Laboratories (Electrophysiology) 500 SHR Hotel 457 E*TRADE 412 Pacific Biosciences of California 380 United Parcel Services 309 Safeway Stores, Inc. 300 Atieva USA, Inc. 260 CITY OF MENLO PARK BUDGET 3

28 City Overview Organizational chart Residents Population 35,268* Council Members Mayor Peter I. Ohtaki Mayor Pro Tem Ray Mueller Catherine Carlton Richard Cline Kirsten Keith Advisory Boards, Commissions and Committees City Manager Alex McIntyre $3.51 million 10.0 FTEs City Attorney William McClure $0.84 million 1.0 FTEs City Manager s Office, City Clerk, Sustainability Administrative Services Nick Pegueros $17.69 million 22.0 FTEs Finance, Human Resources, Information Technology, Non-Departmental Community Development Mark Muenzer $8.87 million 31.0 FTEs Building, Planning, Housing and Economic Development Community Services Derek Schweigart $9.81 million FTEs Child Care, Community Centers and Special Events, Sports and Recreation Library Susan Holmer $3.89 million 18.5 FTEs Adult Services/Reference, Circulation Services, Literacy Services, Technical Services, Youth Services Police Dave Bertini $19.95 million 77.5 FTEs Investigations, Patrol Services, Public Safety Dispatch Public Works Justin Murphy $79.47 million 70.0 FTEs Engineering, Maintenance, Transportation *Source: California Department of Finance, estimate 1/1/18 4 CITY OF MENLO PARK BUDGET

29 City Overview Demographics 2010 U.S. Census population and housing data POPULATION Male 48.4% Female 51.6% 2000 to 2010 change in population 5.0% 2010 U.S. Census population and housing data NUMBER OF HOUSEHOLDS Family Households 7,573 Non-Family Households 4,774 TOTAL HOUSEHOLDS 12, to 2010 change in population 14.4% 1980 to 2010 change in population 21.5% AVERAGE HOUSEHOLD SIZE 2.5 TOTAL POPULATION 32,026 AGE 0 17 years 23.0% years 5.7% OCCUPIED HOUSING UNITS Owner Occupied Units 6,927 Renter Occupied Units 5,420 TOTAL OCCUPIED HOUSING UNITS 12, years 31.5% years 26.1% 65+ years 13.7% MEDIAN HOUSEHOLD INCOME ( ) $113,774 MEDIAN AGE 38.9 ETHNICITY White 70.2% Asian 9.9% Other 8.7% Black or African American 4.8% Two or more races 4.5% Pacific Islander 1.4% American Indian and Alaska Native 0.5% TOTAL 100% Note: Hispanic (all races) 18.4% CITY OF MENLO PARK BUDGET 5

30 City Overview Budget process ANNUAL BUDGET CALENDAR Like any complex organization with an annual budget of over $144 million, the process to develop and produce the budget is continuous throughout the fiscal year, which runs from July 1 to June 30: July through September Departments report on performance from prior fiscal year Encumbrances and project carryovers incorporated into budget Scoping meetings for the five-year Capital Improvement Plan (CIP) October through December Five-year CIP drafted and prioritized Operating budget schedule developed January through March Budget schedule, directions, and budget guidance provided to departments Annual City Council Work Plan Session Annual midyear financial report presented to City Council Department operating budgets drafted and reviewed with City Manager April through June Revenue projections finalized Ten-year forecast developed Annual budget workshop/study session Public hearing on budget and five-year Capital Improvement Plan Budget adoption FISCAL YEAR BUDGET PREPARATION PROCESS The fiscal year budget marks the fifth year of the City s department-based budget structure and document. Before fiscal year , the City budgeted by program and service as opposed to department and division. The program/service budget structure allocates resources to specific services provided by the City, which ideally allows users of the budget to understand what services the City provides and how much it spends on them. While this can be a great way to present budget information, from a practical perspective, it made the City s budget difficult to understand. With 30 distinct programs and over 110 services, the fiscal year budget was so finely parsed that the answers to typical budget-related questions such as How much does it cost to run the Police Department? or How many employees are there in Public Works? were very difficult to provide. Further, the number of programs and services made budget management difficult and time-consuming, taking time away from other tasks. The development of the fiscal year operating budget began in early February with departments updating revenue and expenditure estimates for the current year, as well as developing next year s budget proposals. Initial direction to the departments was to develop a baseline budget that maintained existing service and staffing levels, with any requests for service enhancements to be addressed at budget reviews with the City Manager. The City Council held its annual work plan workshop in January, which provided additional direction on priorities for additions to the base budget, further informed by the mid-year budget presented to the City Council in February. Development of departmental operating budgets continued into March and April, while the Finance Division worked to update to the 10-year forecast s methodology. With preliminary revenue estimates developed and base operating budgets entered into the budget system, reviews with the City Manager commenced in May and focused on three things: establishing each department s base budget, identifying department-initiated requests for servicelevel enhancements and quantifying increases required to support the City Council Work Plan. Revenue projections, particularly those related to the City s most significant revenue sources, continued to be updated and refined as more information became available. As the revenue picture became clearer in late May, the budget process turned toward establishing what service-level increases could be accommodated in fiscal year and completing the 10-year forecast. As the numbers were finalized, attention was then turned toward the design and creation of the budget document. While the foundation for the new document content was largely established for the budget, additional attention was paid to making content accessible to all of the budget s intended audiences. 6 CITY OF MENLO PARK BUDGET

31 City Overview Budget process BUDGET POLICIES & PRACTICES Budget management and appropriations control The City Manager has responsibility for management of the overall City budget and maintenance of appropriations control. The City Manager is authorized to transfer budgetary amounts within a single fund; however, any revisions altering the total expenditures of any fund must be approved by the City Council. Appropriations, which become effective each July 1, lapse at the end of the fiscal year, with the exception of appropriations for capital improvement projects. Due to the nature of these projects, which often span multiple fiscal years, unexpended capital improvement project funds are automatically carried forward to the following fiscal year as part of the project budget and do not require re-appropriation by the City Council. Fund accounting The City s financial information is organized by fund, with each fund being a separate and distinct entity. There are three types of funds: governmental, proprietary and fiduciary. The General Fund, which is a governmental fund, is the City s main fund that accounts for the vast majority of the City s operations, including but not limited to: police services, recreation, planning, building inspection, library, engineering, parks maintenance, street maintenance and general administration. Other types of governmental funds include special revenue funds and capital projects funds, which, unlike the General Fund, account for specific revenues and are used for specific purposes. Proprietary funds are used to account for the City s activities that are financed and operated in a manner similar to private business enterprises and include enterprise funds (water capital and operations) and internal services. The City s fiduciary funds are agency funds that are used to account for certain assets held on behalf of others, and the City s role in these funds is strictly custodial in nature. The City does not budget its fiduciary funds. More information on the City s various funds can be found in the Budget Summary and Discussion section of this document. modified accrual basis, revenues are recognized only when they become susceptible to accrual, which means when they become both measureable and available. Revenue is measureable when the amount of the transaction can be determined, and it is available when it is collectible in a manner that allows it to be used to pay for liabilities in the current period. Governments normally define an availability period for revenue recognition, and the City considers revenues related to a particular fiscal year available if they are collected within 60 days after that fiscal year s end. Sixty days is a common revenue recognition period. Expenditures are typically recorded when the liability is incurred, with the exception of debt service expenditures. Debt service expenditures are recorded when payment is due. The accrual basis is used for the proprietary funds, which includes the enterprise funds and the internal service funds. Under the accrual basis, revenues are recognized when they are earned, and expenses are recognized when the related liability is incurred. Basis of budgeting Basis of budgeting refers to the method used to recognize revenues and expenditures in the budget, and in Menlo Park, the basis of budgeting is the same as the basis for accounting. For governmental and fiduciary funds, the modified accrual basis is followed. Under the CITY OF MENLO PARK BUDGET 7

32 City Overview Budget process STRATEGIC PLANNING The City s annual budget is intended to present a clear, coherent vision for accomplishing the City Council s work plan, but it inherently contains several elements which link it to future iterations and help to ensure that the vision can come to fruition. City Council Work Plan prioritization process During the City Council s goal-setting session in January, a new system was implemented to help focus and prioritize the goals of the City Council, including the identification of a smaller number of projects which the City Council collectively felt were the most important to the community. Following a forum for community input, the City Council used a ranked voting system to narrow down the potential priority projects, where each City Council member would vote on several projects, then the projects receiving the fewest votes would be dropped for the next round of voting. This process ultimately resulted in six projects being identified as the top priorities, and while the other projects in the work plan were not halted, the top priority projects would receive preference in cases of limited resources. Budget Principles as a guide Following the goal-setting session, the City Council adopted the Budget Principles previously discussed in the Transmittal Letter, with four overarching ideals: Promotion of the City s long-term fiscal sustainability, and the ability to predict changes in expenditures balanced by active revenue management and achievement of full cost recovery in many cases Enhancement and maintenance of core City services and infrastructure by focusing on those initiatives which contribute to the quality of life in Menlo Park and prudent investments Management of staff capacity for service delivery by investing in productivity technology and attracting and retaining talent and institutional knowledge Communication of the City s financial position and ensuring shareholder access without compromising internal controls over the City s resources Each of these Budget Principles has a decided longterm temporal component which supports a year-toyear link in budgeting and helps to ensure that even an annual budget is not narrowly focused. Strategic 10-year forecast One initiative started by the Finance & Audit Committee during this budget preparation cycle is the development of a strategic forecast, intended to help identify areas of opportunity or concern in future years. The forecast incorporated a number of known events, as well as use of uncertainty modeling, helping to better understand the potential landscape of finances in later budget cycles. With this tool, the City can make decisions about where to increase capital spending, reduce operating expenditures, or use other levers of control over finances. Use of reserves The final component of linking the annual budget to a longer-term plan is the savings and future use of strategic reserves. The City maintains a General Fund Reserve Policy which dictates that the City save a percentage of the General Fund s operating budget as a reserve in the event of economic downturn, emergency contingency, and strategic pension funding opportunities. This policy allows the City to address unanticipated, one-time needs or opportunities with an eye to the future. In addition, the City keeps the policy of using the following year s transfer to the General CIP from the General Fund as assigned, though this policy could be suspened in a given year. The anticipated total of all reserves, assigned and unassigned fund balance is projected to be $36.56 million. 8 CITY OF MENLO PARK BUDGET

33 City Overview Budget process GFOA Award One of the premier organizations for finance staff at all levels of government, the Government Finance Officers Association (GFOA), conducts an annual award program for budget development and presentation. The Distinguished Budget Presentation Award is recognition that award winners have gone to great lengths to ensure that their budget documents are of the highest quality on a number of criteria. The City of Menlo Park won its first award for the fiscal year budget, a reflection on the dedication of the City Council, City staff, the Finance and Audit Committee, and members of the community in building a document which clearly conveys the financial resources, priorities, and spending plan for the agency. GFOA uses a set of nationally recognized guidelines for effective budget presentation to evaluate the award program particpants budgets. The guidelines are designed to determine how well an agency s budget serves as: a policy document a financial plan an operations guide a communications device Agencies which receive GFOA awards serve as examples for other public sector organizations and encourage engagement from stakeholders. The fiscal year budget was prepared with these criteria in mind as well as the suggestions for improvement from the previous award application. CITY OF MENLO PARK BUDGET 9

34 City Overview 10 CITY OF MENLO PARK BUDGET

35 Budget Discussion BUDGET DISCUSSION CITY OF MENLO PARK BUDGET 11

36 Budget Discussion Introduction The Budget Summary and Discussion section presents the most significant aspects of the City s finances. While the emphasis of this section is on the City s largest and most complicated fund, the General Fund, information is presented in summary on other funds both at the All Funds level and at the fund level. As also mentioned in the City Manager s Transmittal Letter, the budget is built on a number of assumptions more fully detailed in this section. BUDGET OVERVIEW Appropriations for fiscal year total $ million across all funds. The City s General Fund comprises approximately 47 percent of the total appropriations and the General Fund s spending plan provides for a surplus, net of adjustments made by the City Council as part of the budget review process, of $0.32 million. As discussed in the City Manager s Adopted Budget Transmittal Letter, the adopted budget includes $615,000 in contingency funds and $2.35 million in service level enhancements. The fiscal year spending plan has three primary highlights. First, the General Fund is balanced inclusive of new full-time equivalent (FTE) employees approved by the City Council in fiscal year , and continuation of all programs and services provided in fiscal year Second, net revenue for the special revenue funds in total increases fund balance by $1.54 million as the result of fees collected for special purposes exceeding anticipated expenditures. Finally, the spending plan has a total Capital Improvement Plan exceeding $35 million reflecting robust investment in the community BUDGET IMPACT ON FUND BALANCE A meaningful review of the City s finances and its ability to spend on new non-operating initiatives begins with an understanding of the City s fund balance and the impact of the budget on fund balance. Fund balance is simply the accumulation of the City s historical surpluses and deficits. The City s fund balance for each individual fund must begin and end each fiscal year in a positive position. A surplus will increase fund balance and a deficit will decrease fund balance. For fiscal year, all 48 funds begin and end the year with an estimated positive fund balance. Available fund balance reflects the amount that the City Council can appropriate for one-time needs without amending its adopted reserve policies. In accordance with adopted reserve policies, the City maintains committed fund balances for use in the event of an economic downturn, emergency, and to offset impacts of changes in pension costs. The total committed fund balance of $21.91 million is excluded from the available fund balances in Exhibit Additionally, City Council policy assigns fund balance for specific purposes such as encumbrances that carry forward to the upcoming year and Community Development fees in excess of current year expenditures; the sum of these assignments is $4.71 million. When reviewing the City s other funds, the beginning available fund balance reflects only those monies that are available for use. In the Below Market Rate (BMR) housing fund, for example, the beginning fund balance excludes $9 million in loans (notes receivable) that are assets of the BMR fund but are not available for appropriation in fiscal year. Exhibit 1.01 below summarizes the change in fund balance across the major funds with some combination of less active funds. The estimated beginning available fund balance incorporates the anticipated fiscal year surplus for each fund as well as encumbrances for projects approved by the City Council through May 22, In the City s General Fund, the net revenue anticipated in fiscal year increases the beginning available fund balance of $5.55 million by $0.32 million. 12 CITY OF MENLO PARK BUDGET

37 Budget Discussion Introduction Special revenue funds are established as independent funds to monitor revenue collected for a specific purpose and therefore have limited uses. Exhibit 1.01 details the largest and most active special revenue funds. Activity for each individual special revenue fund can be found at the end of this section. It is important to note that some Capital Improvement Plan funding is directly accounted for in the special revenue fund for which the project falls. This is an essential accounting practice to ensure that only the funds necessary for a capital improvement project are used and surplus funds remain in the special revenue fund. Capital improvement funds are dedicated to the five year Capital Improvement Plan budget and are detailed to a greater extent in the Capital Improvement Plan section. Internal service funds are comprised of activities that are internal in nature and are best tracked in independent funds to ensure cost recovery is achieved through changes to the operating department. Services include information technology, workers compensation and vehicle replacement. Debt service funds are limited to debt payments on general obligation bonds authorized by voter approved Measure T in 2000 to fund recreation facility improvements and expansion. Exhibit 1.01 $ millions Estimated Unassigned Beginning Fund Balance, June Revenue & Other Resources Proposed Budget Expenditures & Other Requirements Surplus (Deficit) Unassigned Ending Fund Balance, June ALL FUNDS BUDGET SUMMARY General Fund $5.55 $67.86 $67.54 $0.32 $5.71 Special Revenue Funds Below Market Rate Housing Fee Transportation Impact Fees (0.61) 3.20 Bayfront Landfill Construction Impact Fee Recreation In-Lieu Other Special Revenue Funds (1.36) Capital Improvement Funds General Capital Improvement Water Capital Improvement (4.45) 0.06 Other Capital Improvement Funds (0.04) 0.38 Water Operating Fund Internal Service Funds Debt Service Funds TOTAL $75.98 $ $ $0.22 $76.20 *All special revenue and capital improvement funds are detailed in the Other Funds section beginning on page 42. CITY OF MENLO PARK BUDGET 13

38 Budget Discussion All Funds summary REVENUE & OTHER RESOURCES As outlined in Exhibits 1.02a, 1.02b, and 1.02c, the fiscal year spending plan incorporates total revenue and other resources of $ million across all funds, up 13.9 percent from the prior fiscal year s amended budget. Revenues Revenues reflect funds collected from outside sources such as taxes, charges for services, permits, licenses, franchise fees, intergovernmental revenue and others. For fiscal year, total revenues are budgeted at $ million across all funds, a $10.3 million increase compared to the prior fiscal year s amended budget. The increase is seen in taxes and charges for services, reflecting continued strength in the regional economy and the update to the City s Master Fee Schedule to improve cost recovery. Transfers from other funds Transfers from other funds captures incoming funds from other City funds necessary to provide for items such as capital improvements and to compensate the receiving fund for services provided such as accounting support. The vast majority of transfers from other funds are the result of the annual transfer from the General Fund to the General CIP Fund for specific projects and needs. For fiscal year, total transfers in are budgeted at $7.34 million, an increase of $3.93 million from the prior year in order to pre-fund future planned CIP projects. Internal service fund charges Internal service fund charges are shown as resources to the internal service funds and are distinct from transfers in the sense that the charges are established based on detailed allocation formulas linked to an operating departments use of the service. For example, the information technology internal service charge is developed using a combination of department specific applications, number of workstations supported, helpdesk requests and other factors. For fiscal year, internal service fund charges are budgeted at $7.20 million, an increase of $0.28 million compared to the prior year due to workers compensation costs. Exhibit 1.02a All Funds $ millions Revenue & Other Resources by Type Proposed Budget Taxes $47.29 Charges for services Permits, licenses, intergovernmental Other 5.12 Subtotal Revenue $ Transfer from other funds 7.34 Use of assigned fund balance TOTAL REVENUE & OTHER RESOURCES $ Use of assigned fund balance Use of assigned fund balance is the use of fund balance designated by the City Council in prior fiscal years for a specific purpose. In fiscal year, the $30.68 million use of assigned fund balance provides for carryover appropriations in the Capital Improvement Plan budget. On an annual basis, the budget appropriates expenditures for projects that often span more than a single fiscal year. Those appropriations are carried-over from one fiscal year to the next, allowing the project to continue. The $30.68 million in use of assigned fund balance for carryover capital project expenditures is reflective of the commitments made before the beginning of fiscal year that are anticipated to make progress in that fiscal year. Differing from fiscal year , the use of assigned fund balance does not include expenditures in the Community Development Department which exceed revenues. This change is in part a recognition of the Cost of Services and User Fee Study completed in fiscal year which resulted in an update to the Master Fee Schedule and the expectation that development continues at its current level through the fiscal year. 14 CITY OF MENLO PARK BUDGET

39 Budget Discussion All Funds summary Exhibit 1.02b Revenues by function Community Services Police Administrative Services Library CMO Community Development Public Works Non Departmental Exhibit 1.02c Revenues by type Use of assigned fund balance Taxes Transfer from other funds Other Permits, licenses, intergovernmental Charges for services CITY OF MENLO PARK BUDGET 15

40 Budget Discussion All Funds summary EXPENDITURES & OTHER REQUIREMENTS As outlined in Exhibits 1.03a, 10.3b, and 1.03c, the fiscal year spending plan incorporates total expenditures and other requirements of $ million across all funds, by function, to provide greater insight into the uses of the resources. Approximately 55 percent of total requirements fall under the Public Works Department. Public Works provides a number of public services ranging from engineering inspections, street and parks maintenance, and the water division, to a name a few. In addition to these public services, the Department is also responsible for the five-year Capital Improvement Plan (CIP). Of the total $79.47 million Public Works budget for fiscal year, the CIP accounts for $51.34 million, resulting in a net operating budget for fiscal year of $28.13 million. Exhibit 1.03a All Funds $ millions Expenditures & Other Requirements by Function Proposed Budget Public Works $79.47 Police Community Services 9.81 Community Development 8.87 Administrative Services 6.19 City Manager, City Council, City Attorney 4.94 Library 3.89 Nondepartmental TOTAL $ The Police Department is the second largest component of the budgeted expenditures totaling $19.95 million, approximately 14.1 percent of the total requirements and is entirely operations in nature, reflecting the service intensity of the public safety and services. Non-departmental requirements provide for internal service funds such as workers compensation, general liability, retiree medical, as well as debt service payments on the City s General Obligation bonds for recreational facilities. Given that these funds serve the entire organization, the requirements are reported as non-departmental, but continue to be administered by the Administrative Services Department. 16 CITY OF MENLO PARK BUDGET

41 Budget Discussion All Funds summary Exhibit 1.03b Expenditures by function City Council, Attorney & Manager Library Non-departmental Administrative Services Non-departmental Public Works Community Development Community Services Police Exhibit 1.03c Expenditures by type Utilities Transfers & other Operating expenses Capital (incl. carryover) Services Benefits Salaries CITY OF MENLO PARK BUDGET 17

42 Budget Discussion General Fund summary FUND BALANCE On an annual basis, the City builds a balanced General Fund budget. The General Fund is the fund which accounts for the vast majority of current services and revenues. The General Fund s fiscal year budget provides for a modest increase in fund balance of $0.32 million, resulting in a balanced budget as shown in Exhibit As mentioned earlier, the budget is built on a number of assumptions, the most significant of which will be discussed later in this section. Exhibit 1.04 details fund balance in the General Fund for the fiscal year budget, as well as fiscal years and Over the three-year period beginning July 1, 2016 and ending June 30, 2019, available fund balance has grown from $0.78 million to $5.71 million. While the increase in available fund balance is an indicator of fiscal stability, it is important to acknowledge that fund balance is one-time money and cannot be relied upon for annual operating expenditures. Exhibit 1.04 $ millions Actuals Amended Budget Estimated Actuals Proposed Budget GENERAL FUND BUDGET SUMMARY Beginning Fund Balance, July 1st $0.78 $2.28 $2.28 $5.55 Operating Revenue Expenditures Surplus/(deficit) Non-Operating Transfers-In & Use of assigned fund balance Transfers-Out Net Revenue ENDING FUND BALANCE, JUNE 30TH $2.28 $4.88 $5.55 $ CITY OF MENLO PARK BUDGET

43 Budget Discussion General Fund summary PROPOSED BUDGET OVERVIEW The fiscal year General Fund budget is balanced with revenue and other resources totaling $67.86 million and expenditures and other requirements totaling $67.54 million. Exhibit 1.06 General Fund $ millions Expenditures & Other Requirements by Function Proposed Budget As summarized in Exhibit 1.05, 94 percent of fiscal year total revenue and other resources are derived from taxes, charges for services, permits, licenses and franchise fees. Taxes are shown at $41.83 million, 62 percent of the total. Charges for services, permits, licenses and franchise fees reflect receipts for services provided to the community ranging from recreation classes to building permits. Over the last five years, the City has seen positive growth in these revenues, and the upward trend is expected to continue in fiscal year. Exhibit 1.06 summarizes expenditures and other requirements by function or department. Police and Public Works combined make up approximately 47 percent of the General Fund requirements for fiscal year. Police $19.81 Public Works Community Services 9.81 Community Development 8.33 City Manager, City Council, City Attorney 4.20 Administrative Services 3.12 Library 3.57 Non-departmental 6.77 TOTAL $67.54 Exhibit 1.05 General Fund $ millions Proposed Budget Revenue & Other Resources by Type Taxes $41.83 Charges for services Permits, licenses, franchise fees Intergovernmental revenues 1.06 Other 2.50 Transfer from other funds 0.50 Use of assigned fund balance - TOTAL $67.86 CITY OF MENLO PARK BUDGET 19

44 Budget Discussion General Fund summary REVENUE & OTHER RESOURCES General Fund revenue and other resources for fiscal year total $67.86 million. When compared to fiscal year estimated actual resources, fiscal year revenue and other resources are expected to increase by $6.60 million, or 10.8 percent. Of this amount, property taxes and transient occupancy tax revenues are expected to increase approximately $3.74 million. All traditional indicators of revenue health such as changes in assessed value, hotel occupancy rates, permit activity and recreation class registrations suggest that fiscal year will see positive revenue growth. The strength in revenue growth is attributed to a strong local economy and prudent land use decisions made by the City Council. In fiscal year, the budget anticipates transient occupancy tax (TOT) revenue resulting from a full year of operations at Hotel Nia, which opened late spring in 2018, as well as the opening of the Park James Hotel in summer In the fiscal impact analysis prepared for the project, Hotel Nia is projected to generate $3.5 million in new transient occupancy tax revenue for the City. While transient occupancy tax revenues are confidential, staff has taken a conservative estimate of each of the hotel s anticipated transient occupancy tax revenue in fiscal year. Outside of revenue, the single largest change when compared to prior year estimated actual, is in assigned fund balance. For fiscal year , the adopted budget included use of assigned fund balance to balance the Community Development Department budget in the amount of $1.85 million, but as a result of the Master Fee Schedule update and increased cost recovery, this is unnecessary for fiscal year Exhibit 1.07a $ millions Actuals Amended Budget Estimated Actuals Proposed Budget GENERAL FUND REVENUE SUMMARY Property Taxes $20.56 $20.85 $23.80 $23.39 Charges for services Transient occupancy tax Licenses and permits Sales tax Franchise fees Fines Utility users' tax Interest and rent income Intergovernmental & Other Subtotal Revenue $52.88 $58.06 $60.78 $67.36 Transfers from other funds Use of assigned fund balance TOTAL REVENUE AND OTHER RESOURCES $53.36 $60.39 $61.26 $ CITY OF MENLO PARK BUDGET

45 Budget Discussion General Fund summary EXPENDITURES & OTHER REQUIREMENTS General Fund expenditures and other requirements for fiscal year total $67.54 million. When compared to fiscal year amended budget expenditures and other requirements, total General Fund expenditures and other requirements are expected to increase by $10.50 million or 18.4 percent. Of this amount, the greatest increase is in transfers to the General CIP Fund to pre-fund future planned projects in the amount of $3.50 million. In addition to the standard transfer made to the General CIP Fund to maintain and extend the useful life of capital projects, this transfer out will allow work to progress on the City Council s ambitious work plan. Additionally, personnel expenditures increase by $4.95 million as a reflection of known benefit and wage increases based on negotiated agreements with the City s labor units, increased pension costs, and the addition of 7.25 FTEs in the Administrative Services, City Manager s Office, Library, Police, and Public Works Departments to meet the growing service needs of the City. Finally, other notable changes in requirements when compared to the fiscal year budget are to internal service fund charges and services. Internal service fund charges are increasing by $0.71 million primarily due to higher demands for workers compensation. In workers compensation, the internal service fund allocation has increased to offset claims reserve losses. Services have increased by $0.65 million as City departments rely more heavily on augmentation by outside providers as a strategy to meet temporary demand and as organizational reviews of the Community Services and Public Works Departments seek to optimize service delivery to the community. Exhibit 1.08a $ millions Actuals Amended Budget Estimated Actuals Proposed Budget GENERAL FUND EXPENDITURE SUMMARY Salaries and wages $23.39 $25.35 $24.19 $28.52 Fringe benefits Operating Utilities Services Fixed assets and capital outlay Travel and training Repairs and maintenance Special projects Internal service charges Transfers out TOTAL $51.86 $56.93 $56.53 $67.54 CITY OF MENLO PARK BUDGET 21

46 Budget Discussion General Fund revenue discussion PROPERTY TAXES As the City s largest revenue source, property taxes are essential to understanding the fiscal health of the City in current and future years. For Menlo Park and the surrounding area, property taxes have proven quite resilient even through the depths of the Great Recession. This resiliency is attributed to location, land use decisions, significant investment in real estate improvements, and turnover in the housing stock to yield new base year assessed valuations in accordance with State law which caps the base property tax rate at 1 percent of base year assessed valuation adjusted annually for cost of living not to exceed 2 percent (Proposition 13). Property tax is comprised of several components with secured property tax, the tax on real property and the structures on that real property, making up the single largest component. Secured property tax revenue is driven primarily by increases in assessed valuation and, as of May 2018, the San Mateo County Assessor has reported a year-over-year increase in the City s secure property assessed values of 7 percent. This positive growth in the City s largest revenue source is a key component of maintaining and enhancing service levels to the community. As summarized in Exhibit 1.09, property tax on secured property is budgeted at $21.13 million, a 6.0 increase over estimated actuals. The 6.0 percent increase is lower than the Assessor s report due to the City s traditional budgeting practice of only budgeting 50 percent of the excess ERAF revenue. The City received 100 percent of the excess ERAF revenue in fiscal year Unsecured property tax represents the tax on appurtenances such as furniture, machinery and equipment and is budgeted at $0.03 million. Supplemental property tax, budgeted at $0.63 million, is the result of reassessing the value of real property when there is a change of ownership or new construction is completed after the official lien date. Exhibit 1.09a General Fund $ millions Property Taxes Proposed Budget Secured property $21.13 Supplemental assessments 0.54 Document transfer tax 0.63 Excess ERAF 1.10 TOTAL $23.39 Documentary transfer tax is a tax imposed on documents exchanged in the transfer of interest in real estate and is based on the value of the real estate. This revenue source is budgeted at $0.63 million. Finally, as shown in Exhibit 1.09, the City anticipates a refund of excess ERAF (Education Revenue Augmentation Fund) in fiscal year in the amount of $1.10 million. Overall, the outlook for property tax is very positive, with expectations of increased assessed valuations in both the residential and commercial sectors driving revenue growth. The secured property tax revenue projection for the 10-year forecast factors in general growth in assessed value based on estimated California Consumer Price Index growth, turnover in both residential and commercial properties, and assuming receipt of only 50% of excess Education Revenue Augmentation Fund (ERAF), and the impact of a number of permitted large-scale development projects and other recently approved major projects or projects currently in the entitlement process. Based on these different factors, the annual growth factor for secured tax ranges from 1 percent to 6.5 percent and averages approximately 4.6 percent per year. 22 CITY OF MENLO PARK BUDGET

47 Budget Discussion General Fund revenue discussion While the trend in assessed values is expected to remain positive, two areas of concern remain when evaluating the City s largest revenue source. Excess ERAF: When the State of California imposed the Education Revenue Augmentation Fund (ERAF) on cities and special districts across the State in the early 1990s to alleviate the State s funding obligations to local schools, were diverted from cities to schools. In fiscal year , the estimated ERAF shift for the City totaled $2.24 million. As assessed values in San Mateo County grow, the funds deposited to the County s ERAF exceeds the mandated distribution to schools and are returned to the taxing entities. Excess ERAF revenue has been considered at high risk out of concern that the State might update the school funding formulas to fully utilize the ERAF collections. This would mean a loss of revenue to the City in the magnitude of over $2.0 million per year. To protect against a budget deficit that might result from a loss of excess ERAF revenue, the City has exercised a practice of only budgeting 50 percent of the prior year s excess ERAF revenue. For fiscal year, the excess ERAF revenue is budgeted at $1.10 million. Assessed valuation appeals: When owners of a large and complex property appeals their base year assessed value, the appeal can often take many years to resolve. If the appeal results in a lower Proposition 13 assessed value, the property owner receives a credit for property taxes in excess of the lowered assessment and the loss is apportioned to all cities in the County. In recent years, there have been notable appeals on unsecured property related to aircraft at San Francisco International Airport which have resulted in reductions to Menlo Park s property tax revenue. The County Assessor s staff advised the City in May 2017 that the volume of appeals, the time required to resolve appeals, and insufficient staffing in the Assessor s office to manage the appeals has resulted in a significant backlog in appeal resolutions. One prominent appeal originally filed for the period of 2000 to 2004 was only recently resolved. While it is difficult to factor in the impact of appeals on the City s finances, staff remains in contact with the Assessor s office to ensure that any significant impacts on Menlo Park revenues are known as early as possible. Exhibit 1.09b $ millions $25 $20 $15 $10 $ est. act proposed* *excludes $1.1 million in Excess ERAF *excludes $1.1 million in Excess ERAF CITY OF MENLO PARK BUDGET 23

48 Budget Discussion General Fund revenue discussion TRANSIENT OCCUPANCY TAX Transient occupancy tax (TOT or hotel tax) is the tax added to hotel guest bills for stays of fewer than 30 days. For fiscal year, transient occupancy tax revenue is budgeted at $11.18 million, up $4.15 million from estimated fiscal year revenue. The strong demand for lodging in Silicon Valley has resulted in high occupancy rates in the area encouraging additional development of hotels for the region. Exhibit 1.10 documents the growth in transient occupancy tax over the past several years. Transient occupancy tax is expected to continue its growth in fiscal years and as new hotels open. In the longterm, existing hotels are assumed to experience a growth rate between 0 and 4 percent with less ambitious growth rates in the middle of the 10-year forecast. In fiscal year, the City will collect TOT from Hotel Nia in the Menlo Gateway development for the entire fiscal year, and a new boutique hotel on El Camino Real is expected to open in summer of 2018 and generate TOT for the majority of the fiscal year. For both hotels, the City used revenue estimates generated by independent consultants for the projects fiscal impact analyses to assess the impact on the 10-year forecast. The positive outlook on hotel tax revenue indeed strengthens the City s long- term financial condition, however, staff recommends caution when planning for increased operating expenditures based on transient occupancy tax revenue growth. While the number of hotel rooms and the average nightly rate are likely to increase as a result of these new hotels, the hotel industry is dependent on a strong local economy. Fortunately, the Great Recession provides some guidance on the economic impact of hotels and the impact on Menlo Park hotels during the Great Recession showed a slowing of transient occupancy tax revenue followed by a steep increase. Staff regularly monitors hotel tax receipts and occupancy rates to identify any early signs that yearover-year growth is slowing. Exhibit 1.10 $ millions $12 $10 $8 $6 $4 $ est. act. proposed 24 CITY OF MENLO PARK BUDGET

49 Budget Discussion General Fund revenue discussion SALES TAX Sales tax revenue has been a revenue in decline for the past decade. The loss of major sales tax generating sources has caused sales tax revenue to move from the second largest tax revenue source to third, falling behind transient occupancy taxes. Exhibit 1.11 demonstrates the volatility of sales tax revenue, which peaked at over $7.68 million in fiscal year and then dropped to $5.50 million just two years later. The sales and use tax revenue budget for fiscal year is $6.05 million, which reflects a slight decline compared to the estimated actual for fiscal year Sales tax growth is expected to slow each year throughout the 10-year forecast with an overall flat trajectory, a conservative projection reflecting the volatility of this revenue source. Further complicating the forecasting process for sales tax, as well as increasing the overall uncertainty for this revenue source, is the increasing amount of sales tax received from the County pool. Pooled revenues are expected to continue to be a significant portion of the City s overall sales tax revenue as e-commerce continues to become a larger part of the economy. When transactions occur online for sales tax-eligible purchases, the 1 percent share received by cities goes into a County pool for distribution rather than the City where the goods are delivered. For example, if someone shops at the Staples in Menlo Park and purchases a computer, the City receives 1 percent of the sale price in sales tax revenue. If that same person buys that computer via the Staples website, the 1 percent of the sale price, instead, goes to the County pool for distribution to all agencies, as the revenue from online purchases is tracked to the County where the customer is located, rather than to a more precise location due to the lack of detail in the seller s tax return. The County pool is distributed to each jurisdiction based on its share of total taxable sales. This is an important consideration because a jurisdiction s share of pooled revenue is directly tied to its proportion of the local 1 percent amount it receives in relation to the other jurisdictions in the County. The impact of e-commerce on Menlo Park s sales tax revenue will continue to be monitored closely, with the 10-year forecast updated accordingly should conditions change. Exhibit 1.11 $ millions $7 $6 $5 $4 $3 $2 $ est. act. proposed CITY OF MENLO PARK BUDGET 25

50 Budget Discussion General Fund revenue discussion UTILITY USERS TAX The Utility Users Tax (UUT) became effective April 1, 2007, imposing the voter-approved maximum 3.5 percent tax on gas, electrical and water usage and the maximum 2.5 percent tax on cable, telephone and wireless services. On July 19, 2007, the City Council approved a temporary reduction in the tax rate on all utilities to 1 percent, which became effective October 1, 2007, and has been reauthorized each year for the maximum period of a temporary reduction of 12 months. Additionally, there is a cap of $12,000 on the combined annual amount that a user can pay for electric, gas and water. As the historical graph demonstrates, Exhibit 1.12, UUT is not a growing source of revenue, as changes in certain industries, notably the telecom and cable industries, are causing erosion in those revenue sources offsetting any growth from other sources. UUT is projected to be approximately $1.21 million in fiscal year, which is less than a 1 percent increase over final fiscal year estimates. The single largest category is electrical usage, which makes up approximately 40 percent of all revenue from this source. For the UUT 10-year forecast, each individual component is analyzed separately to determine the appropriate growth or decline rate to use. Staff s projections, especially in the early years of the forecast, are heavily based on projections from a consulting firm specializing in assisting UUT cities with compliance activities, legal and legislative issues and UUT revenue forecasting. Based on projected rate increases and usage rates, this component is estimated to increase an average of 3 percent annually throughout the 10-year forecast. This is the same projection made for the gas component, which comprises 10 percent of all UUT revenue. Water-related UUT revenue is projected to grow at a rate of 3 percent annually. For traditional wired telecommunications, there are a number of trends driving the expected decline in tax revenues, with the most significant being wireless services as an alternative, especially in the residential arena. As a result of these trends, wired telecom-related UUT revenues are projected to decline between 2 percent and 3 percent annually throughout the 10-year forecast. Exhibit 1.12 $ millions $1.25 $1.0 $ est. act. proposed 26 CITY OF MENLO PARK BUDGET

51 Budget Discussion General Fund revenue discussion CHARGES FOR SERVICES This category includes revenue collections from fees charged for services provided by City operations. The majority of revenue in the budget for this category comes from Community Services (45.8 percent) and from development related charges from Community Development and Public Works (36.7 percent). Service charge revenue is projected to be nearly $11.96 million in fiscal year , which is a 24 percent increase over year-end estimates for fiscal year Over the past 10 years, this revenue category has increased significantly reflecting increased service demand and cost recovery. The increase is not expected to continue indefinitely. Going forward, the above average development activity is expected to continue over the next several years before beginning to taper off to a more sustainable baseline by fiscal year As revenue in this category is based mainly on cost recovery policies set by the City Council, this revenue category is expected to grow modestly over the next 10 years as personnel costs increase. Additionally, the City receives revenue in this category from Facebook to offset the cost of a police officer as established in Of particular note is the completion of the user fee study and cost allocation plan in spring of 2018, which led to an update of the City s Master Fee Schedule. The findings of the user fee study and cost allocation plan were substantial, unintended subsidies in the Community Development, Community Services, and Public Works departments which were the result of not changing rates since 2009 in many cases. The update to the Master Fee Schedule corrected the subsidies that the City Council did not deem to have a clear public interest, resulting in an increase of $1.54 million in revenue budgeted in charges for services for fiscal year Exhibit 1.13 $ millions $14 $12 $10 $8 $6 $4 $ est. act. proposed CITY OF MENLO PARK BUDGET 27

52 Budget Discussion General Fund revenue discussion OTHER REVENUE Franchise fees The City receives franchise payments from companies providing garbage, electric, gas, water and cable television services. Total franchise fee revenue budget is $2.05 million in fiscal year, which is flat from final estimates for fiscal year For the 10- year forecast, each individual category was analyzed to determine the rate of growth or decline. For the most part, very modest growth was projected for each category; however, in one area, cable television, a 2 percent annual decline is anticipated. This is based on the projected decline in utilization of traditional cable television services. Licenses and permits This category mainly consists of development-related permitting, including revenue from development agreements, and the business license tax. The budget is $7.96 million, which is a 16.8 percent increase over final estimates for fiscal year and driven by the aforementioned update to the Master Fee Schedule. Revenues in this category are estimated to be at a highly unsustainable level due to the level of development activity underway. This above average level of activity is expected to continue through fiscal year before beginning to taper off over the course of two years, returning revenues to a more sustainable baseline level in fiscal year Revenue growth for the remainder of the 10-year forecast is based on a baseline level of activity and increases to permitting fees to keep up with projected increases in personnel costs. Per the development agreement for the Facebook East Campus and Facebook West Campus, $1.05 million in revenue is budgeted for fiscal year. The Facebook East revenue remains a constant $0.9 million through fiscal year after which time it increases to $1 million annually and stays at that amount for the remainder of the 10-year forecast. Revenue from the development agreement for Facebook West is $150,000 annually and will continue through fiscal year Any additional revenue resulting from pending or future development agreements will be factored in as action is taken to enter into agreements. Intergovernmental revenues This category consists of grants from other governmental entities, including the Federal and State government. Total intergovernmental revenue for fiscal year is budgeted at $1.06 million, which is a decline of 1.7 percent from fiscal year estimates. Staff reviews grant revenues annually to determine if they are expected to continue, and if so, ensures that they are incorporated into the 10-year forecast. The majority of the City s grant revenue is for the Belle Haven Child Development Center and is expected to be largely ongoing through the 10-year forecast. Fines and forfeitures This category of revenue consists of traffic-related fines, the fiscal year budget (approximately $1.26 million) reflects expected revenues based on a fully operational traffic enforcement program; however, it also assumes continued the loss of $50,000 annually in vehicle impound cost recovery fees per City Council direction in April With a new baseline set, this revenue source is projected to grow 2 percent annually for the duration of the 10-year forecast. Interest and rent income This revenue category consists of the proceeds the City receives from the properties it leases, as well as earnings from the City s investment portfolio. With respect to rental income, the fiscal year budget ($0.62 million) and beyond reflect the contractual terms of the various leases, including the recent change to the lease terms of the Cornerstone building on El Camino Real. For interest earnings, the fiscal year projection of $0.55 million, net of investment advisory fees, reflects the recent changes to Federal monetary policy and the expectation that yield on the City s investment portfolio will grow somewhat from recent numbers. Given the recent trend in monetary policy and the national economy, the 10-year forecast reflects a slow and modest rise in investment yield over the term of the projection. 28 CITY OF MENLO PARK BUDGET

53 Budget Discussion General Fund revenue discussion Transfers, other revenue and resources The remaining revenues consist primarily of funds transferred into the General Fund from other City funds to pay for the cost of citywide administration, including the cost of Finance, Human Resources and the City Manager s Office. The fiscal year transfer amount of $0.50 million was set based on the percentage increase in staffing costs for the applicable departments. The 10-year forecast reflects a similar methodology, with the transfer anticipated to increase based on projected increases in staffing costs. One significant difference in this category in fiscal year from fiscal year is the utilization of assigned fund balance as a resource to fund General Fund requirements. The use of assigned fund balance takes into consideration two factors. First, to the extent funds go unspent in one fiscal year but are encumbered for spending in the following fiscal year, those funds are not available for other purposes. Those funds are assigned for utilization in the following fiscal year and are shown in the budget as an available resource. The second factor is related to development related revenues for the Community Development Department. Significant development activity has generated permitting and planning fees that have exceeded expenditures. These excess revenues will be necessary to meet service demand in future fiscal years, and as such, have been assigned for that purpose. It is important to note that it is unnecessary for the General Fund to use assigned fund balance in fiscal year but expects to in future years. CITY OF MENLO PARK BUDGET 29

54 Budget Discussion General Fund expenditure discussion PERSONNEL Personnel costs, inclusive of wages and fringe benefits, represent approximately 60 percent of total General Fund expenditures and total $36.22 million for fiscal year , up 6.2 percent when compared to the adopted budget for fiscal year This is inclusive of workers compensation and retiree medical internal service charges of $2.35 million, approximately 6.5 percent of total personnel costs. This amount also includes known compensation increases as a result of negotiated agreements with three of the City s four labor units and an allowance for an increase in the fourth. In addition, this amount includes a vacancy factor, estimated at 4.2 percent, to more realistically reflect the reality that with FTEs, a certain percentage will be vacant during the year and do not require resources to be encumbered only to go unused. 30 CITY OF MENLO PARK BUDGET

55 Budget Discussion General Fund expenditure discussion FULL-TIME EQUIVALENT (FTE) EMPLOYEES The fiscal year adopted budget included 270 fulltime equivalent (FTEs) employees, the vast majority funded directly or indirectly through the General Fund, and over the course of the fiscal year, the City Council authorized an additional 8 FTEs. Among those 8 FTE employees authorized in fiscal year , 6 FTEs are completely funded for a five year term and receive reimbursement revenue to offset all costs incurred by providing service. The fiscal year proposed budget includes the addition of 0.5 FTE Communications Dispatcher in the Police Department to combine with a current 0.5 FTE position to aid in recruitment and reduce the reliance on temporary help. Also in the Police Department, 1 FTE is added in the Code Enforcement Officer classification to aid with the high volume of complex, time-intensive calls for municipal code violations and investigations into quality of life concerns in the community. In the Library, 3 FTEs are added as the department moves away from its reliance on temporary staff and toward the use of regular staff. One Library Assistant and two Librarian positions are added to support functions of administration, Youth Services, and Adult Services. Given the popularity of the Gymnastics program and the increasing demands of staff, the Community Services Department adds 0.75 FTEs to three Gymnastics Instructor positions to make each 1.0 FTE rather than 0.75 FTE. These additions provide greater stability and competitiveness to a program which relies heavily on temporary part-time staff who are difficult to recruit and retain. Supporting both the Administrative Services and City Manager s Office Departments, the addition of 1 FTE Human Resources Technician will reduce the lead time for recruitments, help with employee engagement and employee development functions, and with operating an efficient and effective document archiving and retrieval system. In the Public Works Department, addition of 1 FTE Construction Inspector will support land development projects and help to mitigate construction impacts to the community and uphold City standards in right-ofways. Although the positions have no impact on the General Fund, the budget also includes 2.0 FTEs in the Water Division of the Public Works Department. In April 2018, staff received direction from City Council on the Water System Master Plan, including staffing the positions in the budget. Exhibit 1.14 outlines citywide staffing, across all funds, for fiscal year and for the previous three years by department. Staffing is listed in terms of FTEs, which converts part-time staffing into full-time equivalents. Contract or temporary help, such as seasonal employees that work during certain times of year, are not included because they are not benefited positions. To calculate an FTE, the employee s regular scheduled annual hours are divided by 2,080 hours. An employee who works 20 hours per week would divide 1,040 (52 weeks x 20 hours per week) by 2,080 to result in 0.50 FTE. Exhibit FULL-TIME EQUIVALENT (FTES) EMPLOYEES Department Administrative Services City Council City Attorney City Manager's Office Community Development Community Services Library Police Public Works TOTAL CITY OF MENLO PARK BUDGET 31

56 Budget Discussion General Fund expenditure discussion SALARIES & WAGES Total salaries and wages in fiscal year are budgeted at $28.52 million, a $4.33 million or a 17.9 percent increase over the prior fiscal year s estimated actuals. This category includes base salary and all salary related compensation such as overtime and incentive pays. The significant increase is due, in part, to the addition of 8 FTEs in General Fund departments as part of the fiscal year midyear budget amendment including: 5 FTE Police Officers, Police Sergeant, Management Analyst, and Assistant to the City Manager. In addition to the new positions, the increase is also due in large part to the high vacancy rate experienced by the City during the fiscal year. The mid-year budget amendment included a 4.5 percent reduction in salaries and wages beyond the expected vacancy factor, but as the City moves toward a full staffing level, this trend is not expected to continue indefinitely. Beyond the aforementioned factors, wage increases as a result of negotiated agreements with three of the City s four labor units will take effect at the beginning of the fiscal year and account for increased cost of living in the Bay Area. Beyond fiscal year, certain assumptions have been made regarding the changes in salaries and wages that take into consideration increasing costs for employee pensions and the inflationary factors that were set for non-salary items. The remaining resources were utilized to assume modest salary increases through the forecast. It is important to note that these assumptions are just that and do not necessarily reflect the actual salary adjustments that will be made in the future. There are a number of factors that have to be considered related to future salary increases, including the City s economic condition and changes in revenue and nonoperating costs as well as the City s ability to attract and retain skilled employees in a competitive marketplace. Exhibit 1.15 $ millions $30 $25 $20 $15 $10 $ est. act. proposed* 32 CITY OF MENLO PARK BUDGET

57 Budget Discussion General Fund expenditure discussion FRINGE BENEFITS Total fringe benefits in fiscal year are budgeted at $12.32 million, a $1.11 million or a 9.9 percent increase over the prior fiscal year s estimated actuals. Included in the fringe benefits budget are three major benefits: retirement/pension, contributions to the City s cafeteria plan through which employees purchase medical insurance, internal service charges for workers compensation and retiree medical. Fringe benefits also include the vacancy factor and allowance for future negotiated compensation increases. The $1.11 million increase in the fringe benefits budget is the result of known increases in CalPERS pension costs and required internal service charges for the workers compensation and retiree medical funds. Long-term, the 10-year forecast includes increases to the cafeteria plan, workers compensation and retiree medical internal service charges that fall in the range of medical inflation and assumptions used in the City s calculation of retiree medical costs. Long-term increases in CalPERS are quite significant and are discussed in the General Fund financial outlook. Exhibit 1.16 $ millions $14 $12 $10 $8 $6 $4 $2 $ est. act. proposed RETIREMENT HEALTH OTHER CITY OF MENLO PARK BUDGET 33

58 Budget Discussion General Fund expenditure discussion NONPERSONNEL OPERATING COSTS The remaining 39 percent, or $26.60 million, of the General Fund s expenditures consists of non-personnel costs. For the purpose of the 10-year forecast, nonpersonnel expenditures were broken down into a number of distinct categories: operating, utilities, services, fixed assets and capital outlay, travel, repairs and maintenance, special projects and transfers out. A brief description of the types of expenditures in each category and the growth assumption is provided below. Operating expenditures Operating expenditures, which total $6.80 million in fiscal year, include spending on a wide variety of supplies, materials, and other items related to the operation of the City. The largest expenditure in this category, $2.53 million, is the General Fund s share of the information technology internal service fund charge. As part of this structure, all operating and capital costs associated with information technology are centralized in a distinct fund resulting in allocation charges to operating departments. This mechanism provides for centralized purchasing and coordination of technologies to ensure that the City s buying power across all departments is used to the fullest benefit. Other significant expenditures include $0.69 million for the General Fund s share of the City s General Liability Internal Service Fund and $0.27 million for credit card fees (the fees the City is charged for accepting credit card payments). For the 10-year forecast, operating costs are projected to increase at a rate of 3.0 percent annually to factor in general inflation. Utilities The budget for utilities, including gas, electricity, water and telecommunications, total $1.76 million in fiscal year. Of the total, 53 percent goes toward gas and electricity, 37 percent to water and the remaining 10 percent for telecommunications. Important to note is that the electricity and gas charge includes lease payments for the solar panels installed in Given the duration of this lease agreement, while consumption has decreased as a result of the panels, costs are expected to remain steady in the long term. For the 10-year forecast, the annual inflationary increase is set at an average of 3 percent. Services Budgeted expenditures in this category total $8.64 million in fiscal year and cover a wide variety of service areas, including plan checking services, legal services, the annual financial audit, consultants for special studies, the median landscaping contract and street sweeping. The $8.64 million total in fiscal year is above the normal baseline for service expenditures due to the transition of studies and plans out of the capital improvement fund. In fiscal year , expenditures for services in this area are projected to drop to a more sustainable baseline level. Other services are estimated to increase annually at an average of 3 percent for the duration of the 10-year forecast. Fixed assets and capital outlay Budgeted expenditures for fiscal year are $0.32 million and consist of purchases of items such as office equipment and other specialized equipment required by the operating departments. Expenditures in this category are inflated at an average of 3 percent annually throughout the 10-year forecast. Repairs and maintenance This category has budgeted expenditures of nearly $0.95 million in fiscal year, which covers a wide variety of repair and maintenance activity. Other significant expenditures include maintenance on the City s communications equipment, vehicle maintenance and building repairs. While SB1 affected the price of gas, one of the largest portions of this category, the future inflation is expected to follow general area inflation until further information is gathered. Travel and meetings The travel and meetings category, budgeted at $0.21 million in fiscal year, consists of travel and meeting costs related to training and seminars, including the cost for mileage reimbursements. Expenditures in this category are inflated at an average of 3 percent annually throughout the 10-year forecast. Special projects Expenditures in this category, $1.17 million in fiscal year, are primarily for the General Fund s contributions to the Vehicle Replacement Internal Service Fund which was updated to reflect a 10-year replacement schedule. Since the vehicle replacement schedule factors in inflation, the only aspect of this category that is adjusted annually is the amount provided to outside groups providing community services. 34 CITY OF MENLO PARK BUDGET

59 Budget Discussion General Fund expenditure discussion TRANSFERS TO OTHER FUNDS The General Fund s transfers to other funds is an important component of the City s long-term fiscal health. In fiscal year , the total transfers to other funds is $6.84 million. Of this amount, $6.48 million is a transfer to the General CIP Fund to provide funding for a number of projects discussed more fully in the Capital Improvement Plan section of this document. As with many cities on the peninsula, the City s infrastructure is aging reflecting an ongoing maintenance and replacement schedule. The City must prioritize which projects are addressed each year to balance available funding with available staff resources necessary to manage the Capital Improvement Plan (CIP). As demonstrated in Exhibit 1.17, this line item has experienced volatility in prior years as the City has taken the opportunity to use onetime monies to provide for significant needs. In fiscal year , the transfer out moved nearly $9.6 million from the General Fund to the Other Post Employment Benefits (OPEB) Fund to fully meet the City s retiree medical liability. In fiscal years and , sizable transfers were made to fund the City s CIP needs. Over the next 10 years, the forecast grows the baseline transfer to the General CIP Fund by an annual inflation factor averaging 3 percent. Exhibit 1.17 $ millions $9 $8 $7 $6 $5 $4 $3 $2 $ est. act. proposed CITY OF MENLO PARK BUDGET 35

60 Budget Discussion General Fund outlook The 10-year forecast is presented as two five-year forecasts, near-term through fiscal year and long-term for the five years following fiscal year Both forecasts are built using the assumptions outlined in the discussion earlier in this section. It is essential to point out that the forecasts reflect conservative estimates using the best available information to staff at the time of preparation including historical trends, new or anticipated development, and analyses prepared by third party expert consultants in major revenue areas such as property taxes. While the forecast provides a glimpse of the City s long term financial strength, the forecast is intended to identify challenges that may arise given what is known today. Staff cautions against use of the forecast as a means to make significant longterm financial decisions. The forecast is reviewed and updated regularly and staff is committed to updating the City Council on any changes that may adversely impact the City s financial stability. The near-term forecast focuses on baseline revenue and expenditures from fiscal year and adjusts annually by factors unique to each line item, in addition to using any known, discrete events such as new development. A key component of the forecast is the impact of CalPERS costs escalating beginning in fiscal year and continuing through CalPERS is more fully discussed later in this section. Exhibit 1.18 $ millions proposed NEAR-TERM FORECAST Revenue Taxes $41.83 $43.80 $45.79 $47.30 $49.66 $50.93 Charges for services Permits, licenses, franchise fees Intergovernmental revenues Other SUBTOTAL OPERATING REVENUES $67.36 $69.41 $71.45 $72.79 $74.88 $75.90 Expenditures Salaries $27.23 $28.15 $28.98 $29.84 $30.65 $31.19 Fringe benefits Operating expenses and utilities Contract and professional services Fixed assets, special projects, travel SUBTOTAL OPERATING EXPENDITURES $60.61 $62.76 $65.31 $67.74 $69.59 $70.96 Net operating surplus/(deficit) $6.75 $6.64 $6.14 $5.05 $5.29 $4.94 Transfers In and Use of Assigned Fund Balance Transfers Out and Nonoperating Expenditures NET REVENUE $0.42 $4.24 $3.67 $2.57 $2.79 $ CITY OF MENLO PARK BUDGET

61 Budget Discussion General Fund outlook LONG-TERM FORECAST While the near-term forecast is reflective of assumptions and analysis that is reasonably close to the years forecasted, the long-term forecast is far more speculative. Due to the compounding effect of operational decisions, a decision in the near-term forecast has the potential to significantly shift the results of the long-term forecast. While the full impact of recent changes at CalPERS is the most fully analyzed component of the long-term forecast, lower or higher than assumed changes in the largest revenue, property taxes, or the largest expenditure, salaries and wages, will have an impact on the net revenue forecasts below. The long-term forecast was generated using uncertainty modeling which included the assumption that an economic downturn was nearly certain to occur within the time frame of the forecast. Using a large number of trials, the length of the downturn, subsequent recovery, and change in other years was included in a weighted average, resulting in the figures presented in Exhibit Exhibit 1.19 $ millions LONG-TERM FORECAST Revenue Taxes $52.31 $53.77 $56.36 $58.07 $59.82 Charges for services Permits, licenses, franchise fees Intergovernmental revenues Other SUBTOTAL OPERATING REVENUES $77.15 $78.62 $81.29 $83.16 $86.07 Expenditures Salaries $31.67 $32.11 $32.56 $33.02 $33.47 Fringe benefits Operating expenses and utilities Contract and professional services Fixed assets, special projects, travel SUBTOTAL OPERATING EXPENDITURES $72.46 $73.71 $74.98 $76.31 $77.74 Net operating surplus/(deficit) $4.69 $4.91 $6.31 $6.84 $8.33 Transfers In and Use of Assigned Fund Balance Transfers Out and Nonoperating Expenditures NET REVENUE $2.10 $2.27 $3.62 $4.11 $5.54 CITY OF MENLO PARK BUDGET 37

62 Budget Discussion General Fund outlook CALPERS PENSION In December 2016, the California Public Employees Retirement System (CalPERS) board of directors made a decision to decrease a key assumption used to calculate pension costs for employers who participate in the system. The decision was to lower the assumed rate of investment earnings on the CalPERS portfolio, referred to as the discount rate, from 7.5 percent to 7 percent. This assumption change increases unfunded pension liabilities by upward of 40 percent and will more than double the City s annual pension expenditures by fiscal year As calculated by the City s independent actuary to more fully understand the long-term impact of the CalPERS decision to lower the discount rate assumption, the rate increase is anticipated to increase costs provided in Exhibit 1.20 depicts the change in pension costs. The City s contributions, not including the employee share portion, is expected to increase incrementally over the next 10 years, reaching $8.82 million in fiscal year This cost is net of the cost-sharing agreements currently in place with labor groups which results in non-sworn personnel paying 50 percent of all increased City cost going forward. For sworn personnel, the employees make a contribution that reduces the City s pension rate for sworn personnel by 3 percent of payroll. Assuming the current labor share agreements remain in place, these contribution rates will be partially offset by the employees covering a portion of this cost, as represented by the line in Exhibit The City is currently exploring options to reduce the impact of pension costs on future year budgets. One option includes continuing the City s policy of assigning 25 percent of the General Fund operating budget surplus to the City s Strategic Pension Funding reserve. Estimated at $3.24 million on June 30, 2018, the fund could be used to offset pension costs to the tune of $0.32 million per year for 10 years. While not a significant savings on a $67 million budget, and pension costs that are estimated at $5.30 million in fiscal year, every bit counts. As an alternative, the City has the option of transferring the Strategic Pension Funding reserve to an irrevocable trust similar to the one currently in place for retiree medical. Funds in the trust can earn investment income closer to 4 percent compared to the City s current rate of just over of 1 percent, due to less restrictions on available investments. The greater interest earnings would augment the City s strategic pension funding reserve to either further reduce annual expenditures or extend the life of the reserve. Exhibit 1.20 $ millions $12 $10 $8 $6 $4 $ MISCELLANEOUS CONTRIBUTION PUBLIC SAFETY CONTRIBUTION EMPLOYEE SHARE 38 CITY OF MENLO PARK BUDGET

63 Budget Discussion General Fund outlook FUND BALANCE This section began with a focus on fund balance and the section will end with a long-term look at the General Fund fund balance and its major components. Based on the 10-year forecast, annual increases to the fund balance as a result of positive net revenue will position the General Fund well to manage through any future economic uncertainty. As with previous budgets, staff recommends fiscal prudence when making long-term financial decisions. The rate of growth in major revenues and building activity has been so significant in recent years that similar future growth is unlikely. The 10-year forecast assumes a slowdown in building activity as well as slower growth in revenue as experienced in the Great Recession. The City s experience during the Great Recession, the worst economic period in over 80 years, indicates that the City is likely to fare well in the next economic downturn. After accounting for substantial increases in CalPERS costs, the City Council s forward looking policy decisions on both personnel costs and land use temper the impact of an economic downturn. The decision to share pension cost increases with employees introduces a level of predictability and shared accountability to a pension program that has been criticized as unsustainable. The decision to bring employees to market competitive salaries as a result of the classification and compensation study ensures that the City is paying a market rate compensation package. The decision to approve the ConnectMenlo General Plan Update paves the way for future development to generate revenue supporting the City s needs, longterm. No one decision would provide the City with the economic stability demonstrated in the forecast and, as shown in Exhibit 1.21, the City s fund balance is healthy and ready to protect services to the public in the event any one or more assumptions used in the forecast do not come to fruition. Exhibit 1.21 $ millions $60 $50 $40 $30 $20 $ UNASSIGNED ASSIGNED STRATEGIC PENSION FUNDING EMERGENCY CONTINGENCY ECONOMIC STABILIZATION CITY OF MENLO PARK BUDGET 39

64 Budget Discussion General Fund outlook BONDED INDEBTEDNESS General obligation bonds finance public capital and infrastructure projects, and for local governments in California, these bonds require approval of two-thirds of the voters. The City has three outstanding general obligation bonds: Exhibit 1.22 Interest Rates Issued Date Maturity Date Principal Issued Principal Outstanding Debt service Bond Rating Payment Source GENERAL OBLIGATION BONDS Series 2009A/B Measure T/Parks Series 2012 Measure T/ Parks - Refunding % $10,440,000 $9,980,000 $759,685 AAA Property taxes ,830,000 7,500, ,250 AAA Property taxes TOTAL $20,270,000 $17,480,000 $1,420,935 All three bonds are for recreation facilities and are paid from special assessments to property owners within the City. The schedule below shows the future repayment schedule, in total, for these three general obligation bonds. Exhibit 1.23 SCHEDULE OF FUTURE PRINCIPAL & INTEREST PAYMENTS DUE Year Ending June 30 Principal payable Interest payable Total 2019 $455,000 $956,935 $1,411, , ,528 1,413, ,685,000 4,387,923 7,072, ,250,000 3,851,227 7,101, ,400,000 3,020,309 7,420, ,215,000 2,306,070 8,521,070 TOTAL $17,480,000 $15,460,991 $32,940, CITY OF MENLO PARK BUDGET

65 Budget Discussion General Fund outlook GENERAL OBLIGATION BONDED INDEBTEDNESS The final graph, related to the City s bonded indebtedness, compares the City s general obligation debt against the legal debt limit. State law sets the debt limit as a percentage of total assessed property value. When the conversion percentage and the debt service limit percentage are applied, the City can take on debt in the amount equivalent to 3.75 percent of total assessed value. As this graph indicates, the City s general obligation debt has remained well below the debt limit, which is a contributing factor to the AAA bond rating that each of these issuances has earned. Exhibit 1.24 $ millions $600 $500 $400 $300 $200 $ est DEBT LIMIT GO BOND DEBT CITY OF MENLO PARK BUDGET 41

66 Budget Discussion Other Funds SPECIAL REVENUE FUNDS Special revenue funds are established to collect money that must be used for a specific purpose. Special revenue funds provide an extra level of accountability and transparency to taxpayers that their tax dollars will go toward an intended purpose. Bayfront Landfill Fund This fund was established to receive solid waste surcharges and other revenues to cover the postclosure costs of the Marsh Road Landfill at Bedwell Bayfront Park. As shown in Exhibit 1.25, in fiscal year, $856,000 in revenue is projected and $491,078 in expenditures is budgeted. This fund has an estimated project carryover of $726,580 and a transfer to other funds of $9,400 for fiscal year. Typical post-closure costs include leachate collection, the landfill gas flare, and the gas collection system improvements study. Bedwell Bayfront Park Maintenance Fund This fund is utilized to account for prior-year fees that were charged to the public for trash hauled to the City landfill site, and are now used to maintain the Bedwell Bayfront Park built on the site. Maintenance includes annual mowing of the 120 acres of parkland and daily janitorial service. With investment earnings minimal and no dedicated revenue source, this fund is degrading due to annual operating costs exceeding income. At its current rate of depletion, this fund is projected to deplete fund balance below one full year of annual operating costs by June 30, As shown in Exhibit 1.25, in fiscal year, $1,800 of revenue is expected, and $91,776 is budgeted to be expended with an additional $15,100 to be transferred out. Once funds are depleted, which is expected to be at some point in the next three years, the General Fund will have to assume the ongoing maintenance costs. Ending fund balance in fiscal year is expected to be $132,433. Below Market Rate Housing Fund This fund is utilized to account for fees collected from certain developers of 10 or more residential units in lieu of building affordable housing units required by the Menlo Park Municipal Code Chapters 15.36, and These fees are used to increase the supply of below market rate housing units through down payment assistance loans and loans to affordable housing developers. In addition, these funds are also utilized to account for fees collected from commercial and industrial developers, which are used to expand the stock of low and moderate income houses for people who work in the City. As shown in Exhibit 1.25, in fiscal year, $3,119,900 in fee revenue and interest income is expected to be generated, and $342,065 is budgeted to be expended. Projected fund balance in this fund at the end of fiscal year is $18,700,259. Construction Impact Fee Fund This fund was established to account for developer fees paid to mitigate pavement damage due to heavy construction activity. As shown in Exhibit 1.25, revenues of $2,677,000 are expected in fiscal year, and expenditures are budgeted at $2,156,370. Project carryover for this fund is estimated at $1,615,697 for fiscal year. The bulk of these expenditures are dedicated to support the biannual street resurfacing program. The fund balance projection for the end of fiscal year is $3,586,827. Downtown Parking Permits Fund The fund was established to pay for the ongoing maintenance and capital of the infrastructure of the Central Business District (CBD). The CBD is the area covered by El Camino Real, Oak Grove, University and Menlo Avenue. The majority of the fund is set aside for the reconstruction of the parking plazas. It is also used to fund the cleaning of the parking plazas and landscaping on Santa Cruz and parking plazas. As shown in Exhibit 1.25, in fiscal year, $355,400 in revenue is expected, with expenditures budgeted at $381,390 and $30,100 to be transferred out. Fund balance at the end of fiscal year is expected to be $4,298, CITY OF MENLO PARK BUDGET

67 Budget Discussion Other Funds Francis Mack Trust This fund is an expendable trust that benefits the City s Library programs. As shown in Exhibit 1.26, interest income in the amount of $720 is expected in fiscal year, and expenditures are budgeted to be $9,129. Included in the expenditures is funding for a onequarter time employee to organize the Library events in conjunction with the Community Services Department. Ending fund balance is projected to be $119,370. Highway Users Tax Fund (Gas Tax) This fund accounts for revenues and expenditures related to the City s allocation of the State gasoline taxes that are used for sidewalk repairing and street resurfacing projects. As shown in Exhibit 1.26, in fiscal year, the City expects to receive $940,900 in gas tax and other revenues. Budgeted expenditures in fiscal year total $2,137,514 and $1,268,877 of carryover funds for various projects. Projected fund balance at the end of the fiscal year is $342,142. Housing Fund This fund was established to service the low and moderate income housing loans created by the former Community Development Agency. The loans were transferred to this fund upon dissolution of the Agency. As shown in Exhibit 1.26, in fiscal year, $128,600 of revenue is expected, the fund balance projected for the end of the fiscal year is $819,073. Landscape/Tree Assessment Fund This fund accounts for property tax assessments collected under the Landscaping and Lighting Act of The fund is utilized for the sole purpose of maintaining city street trees. As shown in Exhibit 1.26, in fiscal year, revenues from the assessments are estimated to be $664,489, with a required General Fund annual contribution equal to 25 percent of total expenses from this fund in any one year. In fiscal year, $251,500 is expected to be transferred from the General Fund. Expenditures for street tree maintenance are budgeted at $892,909 and transfers out are budgeted at $75,300. Projected fund balance at the end of fiscal year is $158,844. Library Donations This fund is utilized to account for donations to the Library and the subsequent expenditures of those donated funds. As shown in Exhibit 1.26, donations in the amount of $5,000 are expected in fiscal year, and $39,507 in expenditures is budgeted. Projected ending fund balance is $227,137. CITY OF MENLO PARK BUDGET 43

68 Budget Discussion Other Funds Library Systems Improvement Fund This fund was established to account for donations received for improvements to the physical plant of the Main and Branch libraries. Established in 2017, with a $1,000,000 transfer from the General Fund. As shown in Exhibit 1.26, operating expenditures have been budgeted at $250,000 for the fiscal year, with $470,000 of projected fund balance remaining. Literacy Grants Fund This fund was established to provide literacy services to adult learners. Typical expenditures from this fund include Project Read classes. As shown in Exhibit 1.27, in fiscal year, $170,000 in revenue is estimated, and $226,826 in expenditures is budgeted. Additionally, the yearly transfer from the General Fund has been increased from $55,000 to $110,000 allowing for a continuation of services. Fund balance at the end of fiscal year is projected to be ($55,270). Measure A (County Transportation Tax) Fund This fund accounts for the City s portion of the countywide half-cent sales tax used for City transportation purposes. This fund formerly accounted for all transportation taxes, however in , the funds were broken into separate and distinct funds for each revenue source e.g. Measure A, Measure M and Transportation Shuttles. As shown in Exhibit 1.27, in fiscal year, over $1,305,500 in revenue is expected, and approximately $641,742 in expenditures is budgeted. Major efforts in this fund such as the Oak Grove Safe Routes to School and Green Infrastructure project result in a total carryover of $890,000. Fund balance at the end of fiscal year is projected to be $1,210,027. Measure M Funds Approved by voters of San Mateo County in 2010, Measure M imposes an annual fee of ten dollars on motor vehicles registered in San Mateo County. Fifty percent of net proceeds will be allocated to cities/ County for local streets and roads and 50 percent will be used for countywide transportation programs. As shown in Exhibit 1.27, in fiscal year, $143,000 in revenue is expected, and approximately $143,000 in expenditures is budgeted. This fund was created in fiscal year and no anticipated fund balance is expected since the revenues are fully expended. Miscellaneous Funds These funds include the smaller special revenue funds that have little activity other than primarily earning interest on existing fund balance. Some of the funds in this category include the Community Development Block Grant Fund and the Burgess Trust Fund. As shown in Exhibit 1.27, revenue in the amount of $14,700 is projected for fiscal year, and $208,334 in expenditures is budgeted. Ending fund balance is projected to be $1,412,905 in aggregate for these funds. Public Library Fund This fund accounts for supplementary funds to public libraries to encourage local jurisdictions to maintain local support for their libraries. As shown in Exhibit 1.27, no revenues are projected in fiscal year, and $2,102 in expenditures is budgeted. These funds will be used for computer cataloging upgrades and a volunteer appreciation event. Fund balance at the end of fiscal year is projected to be $81,235. Recreation In-Lieu Fees Fund This fund accounts for developer fees paid in-lieu of building new recreation facilities to offset the development s impacts. The City uses these funds to improve and expand recreation facilities. As shown in Exhibit 1.27, for fiscal year, $506,300 in revenue is expected, and $492,736 in expenditures is budgeted. Carryover appropriations of include project carry-over for previously approved capital projects at Willow Oaks Park and Jack Lyle Park. This fund will also provide funding for the Belle Haven Pool Master Plan Implementation. Ending fund balance in fiscal year is projected to be $2,412,089. SB1 LSRP Capital This fund was established in response to the California Legislature passing the Local Streets and Roads Program Act (LSRP) Senate Bill 1 (SB 1), in April 2017, raising gas taxes and vehicle fees that will be used towards deferred maintenance on the state highways and local streets and roads. As shown in Exhibit 1.27, estimated revenues of $590,000 and budgeted expenses of $500,000 result in an ending fund balance of $90,000 for the fiscal year. 44 CITY OF MENLO PARK BUDGET

69 Budget Discussion Other Funds Sharon Hills Park Fund This fund accounts for a developer payment used for maintenance of Sharon Hills Park. This 12.1-acre park receives regular maintenance of paths, drains, inlets, picnic area, exercise stations and trees, in addition to annual vegetation removal for fire prevention. As shown in Exhibit 1.28, total maintenance costs are budgeted at $16,500 in fiscal year, and the estimated fund balance at the end of the fiscal year is $5,900. Shuttle Program Fund This fund was created in as part of the effort to better distinguish revenues and expenditures between Measure A, Measure M, and Transportation Shuttles. As shown in Exhibit 1.28, in fiscal year total revenues are estimated at $1,017,300 and expenses are budgeted for $1,111,933. Ending fund balance for fiscal year is ($353,751). Sidewalk Assessment Fund This fund accounts for property tax assessments collected under the Landscaping and Lighting Act of These funds are utilized for the sole purpose of repairing and replacing hazardous sidewalks and curbs. As shown in Exhibit 1.28, in fiscal year, revenues are projected to be $250,000, expenditures $260,991, and a transfer out of $22,600. Projected fund balance at the end of fiscal year is ($3,803). Solid Waste Service Fund This fund is utilized to support trash reduction and landfill diversion projects across the City and is funded through garbage rate payments. Moreover, the fund provides a citywide garbage pickup service in order to keep health standards high for single-family residences. This fund has also been used to stabilize rates. As shown in Exhibit 1.28, $353,500 in revenue is expected in fiscal year, while $417,395 in expenditures is budgeted and a transfer out of $88,700. Projected fund balance at the end of fiscal year is $847,696. Storm Drainage Fees Fund This fund was established to account for storm drainage fees used to mitigate City storm drainage problems either directly or indirectly resulting from development. As shown in Exhibit 1.28, fund revenues are estimated to be $3,960 in fiscal year, no expenditures are budgeted. Fund balance at the end of fiscal year is projected to be $$88,272. Stormwater Management Fund This fund accounts for the local requirements delineated in the Stormwater Management Plan and is funded by a citywide fee per parcel. As shown in Exhibit 1.28, revenues are projected to be $356,820 in fiscal year, while expenditures are budgeted at $424,824 and a transfer out of $43,000. Projected ending fund balance for fiscal year is $518,204. Supplemental Law Enforcement Services (SLESF) / (COPS) Fund This fund accounts for funds received from the Supplemental Law Enforcement Services Fund, a State-funded program to support equipment purchases required by law enforcement. As shown in Exhibit 1.28, these funds are budgeted at $119,500 in fiscal year. Funds are used to provide additional frontline law enforcement services. The anticipated fund balance for fiscal year is $186,287. Transportation Impact Fees Fund This fund accounts for traffic improvement fees charged to developers used to mitigate City traffic problems that result either directly or indirectly from development. As shown in Exhibit 1.29, in fiscal year, $2,328,400 is expected in revenue, while $2,943,868 in expenditures has been budgeted. Carryover is estimated at $2,107,152 and some major projects utilizing these fees in fiscal year include the Middle Avenue Caltrain Crossing Study and the Traffic Signals Modification project. As shown in Exhibit 1.30, final fund balance at the end of fiscal year is expected to be $3,199,284. Transportation Fund This fund accounts for grant and other revenues related to transportation activities that are no restricted by an external source such as the State of California. As shown in Exhibit 1.29, this fund is in a deficit which is due to delayed grant revenue. CITY OF MENLO PARK BUDGET 45

70 Budget Discussion Other Funds Vintage Oaks Landscape Fund This fund accounts for a developer payment that is used for maintenance of the perimeter landscaping of the Vintage Oaks subdivision. As shown in Exhibit 1.29, budgeted expenditures in fiscal year are $14,950, and the estimated ending fund balance is $25,610. DEBT SERVICE FUNDS Debt service funds account for the accumulation and disbursement of monies to comply with the interest and redemption requirements of the City s bonded indebtedness. Recreation General Obligation Bond 2002 This debt service covers all of the outstanding debt issuances related to the Measure T bonds, which were used to construct improvements to the City s parks and recreation facilities. As shown in Exhibit 1.30, debt service, including fiscal agent fees, on these bonds in fiscal year is $1,436,650 and is predominantly funded by special assessments on property owners. This debt service is partially offset by a rebate from the Federal government as a part of its Build America Bonds program. CAPITAL PROJECTS FUNDS Capital projects funds are utilized to account for funds that are committed, assigned or restricted to expenditures for capital outlays. This includes the acquisition or construction of capital facilities or other capital assets. General Capital Improvement Fund This fund is utilized to provide adequate funding for maintenance of the City s current infrastructure including: playground park improvements to Burgess Park, Willow Oaks Park and Nealon Park; tennis court maintenance, the Library space planning conceptual design; and partial funding for the sidewalk repair program. As shown in Exhibit 1.30, in fiscal year, the General Fund will contribute $6,480,000 to support planned expenditures totaling $7,052,943. In addition to the General Fund contribution, $14,464,316 of project carryover is estimated for fiscal year. Ending fund balance is projected to be $2,291,663. Library Additions Fund This fund was established to account for the proceeds of the 1990 Library Improvements Bond Issue used to construct improvements to the existing Library. As shown in Exhibit 1.30, in fiscal year, $40,000 in expenditures is budgeted for building repairs, maintenance and equipment. The expected ending fund balance at the conclusion of is $77,756. Measure T General Obligation Bond This fund was established to account for the proceeds of the 2002 Measure T Recreation Improvements Bond Issue used to construct improvements to the City s parks and recreation facilities. As shown in Exhibit 1.30, interest income of $1,560 is expected in fiscal year Ending fund balance is projected to be $301,341. PROPRIETARY FUNDS Proprietary funds are used to account for the City s activities that are financed and operated in a manner similar to private business enterprises and include enterprise funds (water operations and capital) and internal services. Enterprise Funds Enterprise funds are used for services provided to the public on a user charge basis, similar to the operation of a commercial enterprise. Water utilities are common examples of government enterprises. Water Capital Improvement Fund This fund accounts for the proceeds of the capital surcharge from water operations and is utilized for construction improvements of the water infrastructure. $1,741,600 is budgeted in revenue in this fund in fiscal year, and $6,188,048 is budgeted in expenditures. Expected expenditures include water main replacement, Reservoir No. 2 Reroof, Emergency Water Storage / Supply and carry-over appropriations of $7,556,678 for prior year capital improvement projects. As shown in Exhibit 1.30, fund balance is expected to be $61,663 at the end of fiscal year. Water Operations Fund This fund accounts for the water distribution operations of the Menlo Park Municipal Water. As shown in Exhibit 1.30, revenues are expected to be $11,534,600 in fiscal year and are primarily from water purchased by customers. Expenditures of $9,696,432 in fiscal year are primarily for water purchased by the Menlo Park Municipal Water from the San Francisco Public Utilities Commission (SFPUC/Hetch Hetchy) for resale to customers. Fund balance is expected to be $4,120,828 at the end of fiscal year. 46 CITY OF MENLO PARK BUDGET

71 Budget Discussion Other Funds INTERNAL SERVICE FUNDS Internal service funds are used for operations serving other funds or departments on a costreimbursement basis. Information Technology Fund This fund was established to account for a variety of business services provided by the Information Technology Division of the Administrative Services Department to other City departments. Departments are charged for these services based on their respective utilization. As shown in Exhibit 1.31, the cost in fiscal year is $3,035,156 and total collections should slightly exceed total requirements. Estimated ending fund balance is $740,302. Liability/Fire Insurance Fund This fund accounts for the administration of the City s self-insured general liability insurance program. Revenues in this fund are primarily from collections from the operational departments. As shown in Exhibit 1.31, total projected revenues in fiscal year are $801,900, and expenditures are $801,002. Expenditures cover the cost of claims and program administration. Ending fund balance in fiscal year is expected to be $808,655. Other Post-Employment Benefits This fund accounts for the financial administration of funding from all City departments for retiree medical benefits as these benefits are earned. As shown in Exhibit 1.31, this cost in fiscal year is $1,207,000. Ending fund balance is expected to be $379,905 in fiscal year. Vehicle Replacement Fund This fund accounts for the replacement of vehicles and equipment used by various City departments. As shown in Exhibit 1.31, total collections from departments and other revenues in fiscal year are projected to be $864,900 while expenditures in the amount of $861,000 are planned. The higher revenue is the result of a 10-year funding schedule to replace all vehicles owned by the City. The ending fund balance in fiscal year is expected to be $1,626,057. Workers Compensation Insurance Fund This fund accounts for the administration of the City s self-insured workers compensation insurance program. As shown in Exhibit 1.31, revenues are expected to be $2,090,900 in fiscal year. Expenditures, which total $1,296,228 in fiscal year, cover the cost of claims and program administration and prior year deficits. Ending fund balance in fiscal year is projected to be $(195,576). FIDUCIARY FUNDS The City s fiduciary funds are agency funds that are used to account for certain assets held on behalf of others, and the City s role in these funds is strictly custodial in nature. These funds include refundable deposits, cash bonds payable and the payroll revolving account. The City does not budget its fiduciary fundssince they are not discretionary. CITY OF MENLO PARK BUDGET 47

72 Budget Discussion Other Funds financial summaries Exhibit 1.25 Bayfront Landfill Bedwell Bayfront Park Maintenance Below Market-Rate Housing Construction Impact Fee Downtown Parking Permits SPECIAL REVENUE FUNDS BEGINNING FUND BALANCE $4,664,500 $237,510 $15,922,424 $3,066,197 $4,354,640 Revenue Taxes Franchise fees Licenses and Permits ,000 Intergovernmental revenue ,000 - Fines Interest and rent income 24,000 1,800 92,400 30,000 20,400 Charges for services 832,000-3,027,500 2,000,000 - Donations TOTAL REVENUES $856,000 $1,800 $3,119,900 $2,677,000 $355,400 Expenditures Personnel 87,732 5, , ,603 7,890 Operating 193,347 18,000 23,900 1,776, ,500 Services 210,000 68,000 92, ,000 TOTAL EXPENDITURES $491,078 $91,776 $342,065 $2,156,370 $381,390 Revenues over Expenditures 364,922 (89,976) 2,777, ,630 (25,990) Other resources and requirements Transfer from other funds Use of assigned fund balance 726, ,615,697 - TOTAL RESOURCES $726, $1,615,697 - Project carryover appropriations 726, ,615,697 - Transfer to other funds 9,400 15, ,100 TOTAL REQUIREMENTS $735,980 $15,100 - $1,615,697 $30,100 ENDING FUND BALANCE $5,020,022 $132,433 $18,700,259 $3,586,827 $4,298,550 *Beginning fund balance adjusted to reflect funds available for appropriation. 48 CITY OF MENLO PARK BUDGET

73 Budget Discussion Other Funds financial summaries Exhibit 1.26 Francis Mack Trust Highway Users Tax Housing Fund Landscape/ Tree Assessment Library Donations Library Systems Improvement SPECIAL REVENUE FUNDS BEGINNING FUND BALANCE $127,779 $1,520,756 $690,473 $211,064 $261,644 $720,00 Revenue Taxes - 925, , Franchise fees Licenses and Permits Intergovernmental revenue Fines Interest and rent income , , Charges for services ,600 1, Donations ,000 - TOTAL REVENUES $720 $940,900 $128,600 $664,489 $5,000 - Expenditures Personnel 1, , , Operating 7,300 2,030, ,200 39, ,000 Services , TOTAL EXPENDITURES $9,129 $2,137,514 - $892,909 $39,507 $250,000 Revenues over Expenditures (8,409) (1,196,614) 128,600 (228,420) (34,507) (250,000) Other resources and requirements Transfer from other funds , Use of assigned fund balance - 1,268, ,541 TOTAL RESOURCES - $1,268,877 - $251,500 - $184,851 Project carryover appropriations - 1,268, ,851 Transfer to other funds , TOTAL REQUIREMENTS - $1,268,877 - $75,300 - $184,541 ENDING FUND BALANCE $119,370 $324,142 $819,073 $158,844 $227,137 $470,000 CITY OF MENLO PARK BUDGET 49

74 Budget Discussion Other Funds financial summaries Exhibit 1.27 Literacy Grants Measure A Measure M Miscellaneous Funds Public Library Recreation In-Lieu SB-1 LSRP Capital SPECIAL REVENUE FUNDS BEGINNING FUND BALANCE ($108,444) $471,269 - $1,606,539 $83,337 $2,398,525 - Revenue Taxes - 1,113, ,000 Franchise fees Licenses and Permits Intergovernmental revenue 40, , , Fines Interest and rent income ,620-6,300 - Charges for services , ,000 - Donations 130, TOTAL REVENUES $170,000 $1,305,500 $143,000 $14,700 - $506,300 $590,000 Expenditures Personnel 211,601 2, ,735 - Operating 14, ,026-12,000 2, , ,000 Services 1, , , , ,000 TOTAL EXPENDITURES $226,826 $641,742 $143,000 $208,334 $2,102 $492,736 $500,000 Revenues over Expenditures (56,826) 663,758 - (193,634) (2,102) 13,564 90,000 Other resources and requirements Transfer from other funds Use of assigned fund balance 110, , ,623 - TOTAL RESOURCES $110,000 $890, $986,623 - Project carryover appropriations - 890, ,623 - Transfer to other funds TOTAL REQUIREMENTS - $890, $986,623 - ENDING FUND BALANCE ($55,270) $1,135,027 - $1,412,905 $81,235 $2,412, CITY OF MENLO PARK BUDGET

75 Budget Discussion Other Funds financial summaries Exhibit 1.28 Sharon Hills Park Shuttle Program Sidewalk Assessment Solid Waste Services Storm Drainage Fees Storm Water Management (NPDES) SLESF/ COPS SPECIAL REVENUE FUNDS BEGINNING FUND BALANCE $22,160 ($259,118) $37,336 $1,000,291 $84,312 $629,209 $205,187 Revenue Taxes , ,820 - Franchise fees Licenses and Permits Intergovernmental revenue - 781,000-9, ,000 Fines Interest and rent income , Charges for services - 65, ,000 3,000 3,000 - Donations TOTAL REVENUES $240 $846,300 $250,000 $353,500 $3,960 $356,820 $100,600 Expenditures Personnel - 85,533 8, , ,249 - Operating - 967, ,600 98,312-73, ,500 Services 16,500-1, , ,000 - TOTAL EXPENDITURES $16,500 $1,052,933 $260,991 $417,395 - $424,824 $119,500 Revenues over Expenditures (16,260) (206,633) (10,991) (63,895) 3,960 (68,004) (18,900) Other resources and requirements Transfer from other funds Use of assigned fund balance ,367 59,764 80, TOTAL RESOURCES - - $2,367 $59,764 $80, Project carryover appropriations - - 2,367 59,764 80, Transfer to other funds ,600 88,700-43,000 - TOTAL REQUIREMENTS - - $24,967 $148,464 $80,000 $43,000 - ENDING FUND BALANCE $5,900 ($465,751) $3,745 $847,696 $88,272 $518,204 $186,287 CITY OF MENLO PARK BUDGET 51

76 Budget Discussion Other Funds financial summaries Exhibit 1.29 Transportation Impact Fees Transportation Fund Vintage Oaks Landscape SPECIAL REVENUE FUNDS BEGINNING FUND BALANCE $3,814,752 ($220,361) $40,199 Revenue Taxes Franchise fees Licenses and Permits Intergovernmental revenue 805, Fines Interest and rent income 22, Charges for services 1,500, Donations TOTAL REVENUES $2,328,400 - $360 Expenditures Personnel 453,369 2,000 - Operating 2,490,499-6,250 Services - - 8,700 TOTAL EXPENDITURES $2,943,868 $2,000 $14,950 Revenues over Expenditures (615,468) (2,000) (14,590) Other resources and requirements Transfer from other funds Use of assigned fund balance ,107,152 20,905 - TOTAL RESOURCES $2,107,152 $20,905 - Project carryover appropriations 2,107,152 20,905 - Transfer to other funds TOTAL REQUIREMENTS $2,107,152 $20,905 - ENDING FUND BALANCE $3,199,284 ($222,361) $25, CITY OF MENLO PARK BUDGET

77 Budget Discussion Other Funds financial summaries Exhibit 1.30 Library GO Bond 1990 Recreation GO Bond 2002 General Capital Improvement Library Additions Recreation Additions Measure T Water Capital Improvement Water Operating DEBT SERVICE CAPITAL PROJECTS ENTERPRISE FUNDS BEGINNING FUND BALANCE $331,414 $2,169,989 $2,069,606 $117,156 $300,781 $4,508,111 $2,498,560 Revenue Taxes - 1,565, Franchise fees Licenses and Permits Intergovernmental revenue , Fines Interest and rent income 1,800 1, ,560 51,600 9,600 Charges for services , ,690,000 11,525,000 Donations TOTAL REVENUES $1,800 $1,566,200 $795,000 $600 $1,560 $1,741,600 $11,534,600 Expenditures Personnel - - 1,107,243-1, ,448 1,460,037 Operating - 1,436,650 5,938,300 40,000-6,475,600 7,064,395 Services - - 7, ,172,000 TOTAL EXPENDITURES - $1,436,650 $7,052,943 $40,000 $1,000 $6,788,048 $9,696,432 Revenues over Expenditures 1, ,550 (6,257,943) (39,400) 560 (5,046,448) 1,838,168 Other resources and requirements Transfer from other funds Use of assigned fund balance - - 6,480, ,464, ,556,678 - TOTAL RESOURCES - - $20,944, $7,556,678 - Project carryover appropriations ,464, ,556,678 - Transfer to other funds ,900 TOTAL REQUIREMENTS - - $14,464, $7,556,678 $215,900 ENDING FUND BALANCE $333,214 $2,299,539 $2,291,663 $77,756 $301,341 $61,663 $4,120,828 CITY OF MENLO PARK BUDGET 53

78 Budget Discussion Other Funds financial summaries Exhibit 1.31 Information Technology Liability/Fire Insurance Other Post- Employment Benefits Vehicle Replacement Workers Compensation INTERNAL SERVICE FUNDS BEGINNING FUND BALANCE $658,777 $807,757 $370,005 $1,622,157 ($990,249) Revenue Taxes Franchise fees Licenses and Permits Intergovernmental revenue Fines Interest and rent income 7,200 3,300 7,200 3,900 10,200 Charges for services 3,109, ,600 1,209, ,000 2,080,700 Donations TOTAL REVENUES $3,116,681 $801,900 $1,216,900 $864,900 $2,090,900 Expenditures Personnel 1,266,213 43, ,000-83,228 Operating 648, , , ,000 1,206,000 Services 1,120,370 95,000 25,000-7,000 TOTAL EXPENDITURES $3,035,156 $801,002 $1,207,000 $861,000 $1,296,228 Revenues over Expenditures 81, ,900 3, ,672 Other resources and requirements Transfer from other funds Use of assigned fund balance TOTAL RESOURCES Project carryover appropriations Transfer to other funds TOTAL REQUIREMENTS ENDING FUND BALANCE $740,302 $808,655 $379,905 $1,626,057 ($195,576) 54 CITY OF MENLO PARK BUDGET

79 Budget Discussion CITY OF MENLO PARK BUDGET 55

80 56 CITY OF MENLO PARK BUDGET

81 DEPARTMENTAL SUMMARIES CITY OF MENLO PARK BUDGET 57

82 Departmental Summaries City Council OVERVIEW As of November 2018, the City will transition from atlarge to district-based elections. Summary FTEs 5.0 Total requested budget $0.70 million The Menlo Park City Council consists of a Mayor, Mayor Pro Tem and three Councilmembers who are elected bydistrict and serve staggered four-year terms. At least two Councilmembers are up for election every two years. Funding source General Fund The City Council defines goals and sets objectives for the City by establishing policies, setting priorities and appropriating resources. This budget includes the basic operating expenses of the Mayor and City Council in the conduct of their duties as elected officials HIGHLIGHTS Approved the Bedwell Bayfront Park Master Plan Approved proposal to rebuild the Guild Theatre Approved transition to district elections Authorized funds towards the Menlo Gates monument Approved redesign for Facebook s Building 22 Approved 500 El Camino Real mixed-use project Set a 59-item City Council Work Plan (including 6 Priority Projects) BUDGET The City Council budget maintains its current funding level and includes slight annual adjustments to the Mayor and City Council stipends for health care costs Est. CITY COUNCIL WORKLOAD INDICATORS City Council meetings City ordinances adopted City resolutions adopted CITY OF MENLO PARK BUDGET

83 Departmental Summaries City Council Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Permanent part-time salaries $38,610 $38,505 $38,500 $38,610 $38,400 SALARIES AND WAGES SUBTOTAL $38,610 $38,505 $38,500 $38,610 $38,400 CalPERS Pension 7,111 8,158 8,000 8,376 7,310 Insurances (health, dental, vision, life, Medicare) 99, , , , ,902 Workers Comp, OPEB allocations, other 6,452 1,917 8,080 8,080 5,200 FRINGE BENEFITS SUBTOTAL $113,183 $132,338 $138,546 $140,866 $145,413 PERSONNEL SUBTOTAL $151,794 $170,842 $177,046 $179,476 $183,813 Operating Operating expense 41,080 42,000 68,000 46,500 59,500 Services - 7, ,000-25,000 Special projects expenditures 183, , , , ,000 Travel 22,453 22,717 45,000 23,000 50,000 Utilities 3,269 3,160 3,700 2,750 3,700 OPERATING SUBTOTAL $250,553 $279,841 $548,700 $338,250 $513,200 TOTAL EXPENDITURES $402,346 $450,683 $725,746 $517,726 $697,013 FUNDING SOURCES, BY FUND General Fund $402,346 $450,683 $725,746 $517,726 $697,013 TOTAL $402,346 $450,683 $725,746 $517,726 $697,013 CITY OF MENLO PARK BUDGET 59

84 Departmental Summaries City Attorney OVERVIEW Appointed by the City Council, the City Attorney is the chief legal officer of the City performing duties outlined in the Municipal Code as well as other responsibilities required by the City Council. The City Attorney s Office also oversees the efforts of outside counsel for insured tort defense cases and matters requiring specialized legal expertise. The City Attorney s Office provides legal advice and representation to the City Council, City Manager, staff and the various boards and commissions in all areas, including municipal law, land use, public contracting, public records, public meetings, code enforcement, tort liability and municipal finance. The City Attorney provides advice at public meetings, including legislative and quasi-judicial hearings of the City Council. The City Attorney s Office prepares legal opinions, contracts, intergovernmental and development agreements, ordinances and resolutions, and handles real property transactions HIGHLIGHTS Reviewed city agreements and contracts before approval and posting online, updated numerous forms and procedures Assisted in negotiating and resolving complex land use matters, including litigation with East Palo Alto Provided assistance and guidance on major development projects, including Stanford project at 500 El Camino Real and Menlo Gateway and Facebook West implementation Drafted and/or advised on numerous ordinances and resolutions and reviewed/advised on public records act requests Provided legal advice and assistance with district elections process including staffing district elections committee Summary FTEs 1.0 Total requested budget Funding sources $0.84 million Enterprise Fund General Fund Internal Service Fund Special Revenue Fund Participated in regular agenda meetings and weekly meetings with Public Works and Planning staff Drafted and provided options for consideration of a city charter BUDGET & INITIATIVES The City Attorney s budget reflects its current level of service. This budget does not capture all legal costs for development review and specific projects, those are paid by developers and are contained in various project funds. Additionally, certain human resources and certain labor negotiation costs are also not included here. Provide legal support on development projects, City Council goals, Stanford negotiations and labor negotiations Assist in interpreting the Municipal Code to efficiently process development projects Assist with Below Market Rate (BMR) housing developments and updating BMR ordinance and guidelines Assist in implementing district elections and consideration of city charter Assist in interpreting and implementing Connect Menlo and Specific Plan policies Assist and advise on ordinance updates, contracts, agreements and training of new staff and council members Est. CITY ATTORNEY WORKLOAD INDICATORS City contracts reviewed City Council meetings attended City ordinances adopted City resolutions adopted CITY OF MENLO PARK BUDGET

85 Departmental Summaries City Attorney Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $108,594 $117,231 $120,000 $120,659 $120,000 SALARIES AND WAGES SUBTOTAL $108,594 $117,231 $120,000 $120,659 $120,000 CalPERS Pension 19,261 21,712 22,532 22,649 22,844 Insurances (health, dental, vision, life, medicare) 32,348 35,025 35,729 35,598 21,848 Workers' Comp, OPEB allocations, other 5,358 5,393 6,767 6,767 16,300 FRINGE BENEFITS SUBTOTAL $56,967 $62,130 $65,027 $65,013 $60,992 PERSONNEL SUBTOTAL $165,561 $179,360 $185,027 $185,672 $180,992 Operating Operating expense ,218 1,218 19,000 Services 307, , , , ,000 OPERATING SUBTOTAL $308,776 $447,098 $453,218 $492,218 $657,000 TOTAL EXPENDITURES $474,337 $626,458 $638,245 $677,890 $837,992 FUNDING SOURCES, BY FUND General Fund $431,385 $561,901 $620,448 $593,041 $750,717 Special Revenue Funds - - 2,000-2,000 Internal Service Funds 42,952 64,558 15,797 84,849 85,275 TOTAL $474,337 $626,458 $638,245 $677,890 $837,992 CITY OF MENLO PARK BUDGET 61

86 Departmental Summaries City Manager s Office City Manager s Organizational Chart Total FTEs 10.0 City Administration 6.0 FTEs Office of the City Clerk 2.0 FTEs Office of Sustainability 2.0 FTEs OVERVIEW The City Manager is the chief administrative officer of the City, appointed by the City Council to enact its decisions, initiatives and policies. The City Manager s Office includes City Administration, the Office of the City Clerk and the Office of Sustainability. Beginning in the new fiscal year, the Office of Housing and Economic Development will be moving to the Community Development Department CITY ADMINISTRATION The City Manager implements the City Council s plans and priorities by coordinating the work of all departments and employees, except the City Attorney. The City Manager s Office is charged with providing objective, comprehensive expertise to the City Council through clear staff reports and presentations of thoughtful and strategic recommendations. This office also identifies emerging and unmet community needs, linking them clearly to the City s funding priorities and service levels, while supplying helpful information and referrals to residents with questions, comments and concerns. The City Manager s Office improves citywide operational effectiveness and efficiency, conducts studies for organizational improvement, designs and develops performance measures, analyzes proposed and adopted policies, assists in budget development, responds to community issues and coordinates special projects. OFFICE OF THE CITY CLERK The City Clerk s Office is responsible for the coordination, production and posting of the City Council s agendas and packets, including information and materials reviewed by City Council in preparation for public meetings. The City Clerk ensures public access to agenda materials and understanding of the process for making public comments and participating in public meetings. The City Clerk is also the custodian of a wide range of official documents and permanent City records including: contracts, agreements, recorded documents, minutes, resolutions and ordinances. The Clerk is responsible for responding to requests for public information under the California Public Records Act. The Clerk is also the primary liaison to City Councilappointed commissions/committees serving as advisory bodies to the City Council. Additionally, the Clerk is the local Elections Official, responsible for posting legal notices, processing candidate filings, campaign reports and financial disclosures. OFFICE OF SUSTAINABILITY This Office promotes environmental sustainability by developing and implementing progressive policies, programs and projects related to energy and water conservation, renewable energy, air and water pollution prevention, sustainable community design, zero waste, and reducing the community s contribution to climate change. The Office also oversees stormwater permit compliance, community waste and recycling services, supports the Environmental Quality Commission, and processes heritage tree ordinance appeals. 62 CITY OF MENLO PARK BUDGET

87 Departmental Summaries City Manager s Office HIGHLIGHTS Negotiated 500 El Camino Real project with Stanford Negotiated a revised Development Agreement withfacebook Launched an employee engagement initiative Menlo PERK Continued to work on Library System improvements Produced a weekly digest of news and updates Facilitated the appointment and onboarding of new commissioners and committee members Supported community events, including the Mayor s Annual State of the City and a new Wine Walk event downtown Adopted a Community Zero Waste Plan Established solid waste rates for the next three years Adopted new franchise agreement with Recology to provide waste and recycling services for business and residents Applied for the Bloomberg Philanthropies 2018 Mayors Challenge Amended the Climate Action Plan strategies between 2018 and 2020 BUDGET & INITIATIVES The budget has been changed to reflect the new City Council Work Plan item to implement the Community Zero Waste Plan. Summary FTEs 10.0 Total requested budget Funding Sources Advisory Commission/Committee $3.41 million CITY COUNCIL WORK PLAN ITEMS Enterprise Fund General Fund Internal Service Fund Special Revenue Fund Sister City Environmental Quality District elections Developing a Citywide Communications Program Organizational Study of the Public Works Department Organizational Study of the Community Development Department West Menlo Triangle Annexation Equity in Education Joint Powers Authority Minimum Wage Ordinance Update the Heritage Tree Ordinance Community Zero Waste Plan Implementation Belle Haven Branch Library Improvements Main Library Improvements Continue to work with Facebook on the Willow Village Master Plan Update Solid Waste and Construction and Demolition Ordinance Hydration Station Grant Program Pilot Implementation of Environmental Purchasing Policy Electric Vehicle (EV) Infrastructure Policy and Program Analysis that would lead to a master plan for an EV-ready community Coordinate and support standard operating procedures to implement green design standards in the General Plan across departments Incorporate City Council sustainability policies and goals in other city projects Continue to build staff capacity through professional development and training Continue system improvements to reduce overhead and increase efficiency Develop and effectively manage City Council s Work Plan CITY OF MENLO PARK BUDGET 63

88 Departmental Summaries City Manager s Office CITY MANAGER S OFFICE WORKLOAD INDICATORS Administration Weekly digest s published Items published in the weekly digest City Council meetings attended City Clerk Board and Commissioner appointments/orientations City Council agenda items posted City Council agendas published City Council commendations and proclamations processed City ordinances adopted City resolutions adopted Public Records Act requests Sustainability Events related to increasing recycling, reuse, or use of recycled materials High efficiency toilet rebates processed Large landscape audits completed Lawn Be Gone Rebates processed (rebate paperwork, conducting inspections, etc.) Participants at waste management events Participants in water eficient landscaping classes Community Zero Waste Plan Initiatives implemented Climate Action Plan Initiatives implemented Environmental Quality Commission agendas Pounds of trash cleared from creek hotspot 143 2,700 3,200 6, CITY OF MENLO PARK BUDGET

89 Departmental Summaries City Manager s Office Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $938,411 $895,258 $980,373 $850,534 $1,233,567 Temporary salaries 2,701 60,599 43,200 24,000 95,700 Overtime 755 2,549 2,500 2,000 7,500 Vacation cash-out 19,009 65,951 6,529 68,000 46,000 SALARIES AND WAGES SUBTOTAL $960,876 $1,024,357 $1,032,601 $944,534 $1,382,767 CalPERS Pension 155, , , , ,476 Insurances (health, dental, vision, life, medicare) 113, , , , ,547 Workers Comp, OPEB allocations, other 74,520 47,441 50,508 50, ,400 FRINGE BENEFITS SUBTOTAL $343,351 $324,482 $352,961 $327,346 $614,422 PERSONNEL SUBTOTAL $1,304,227 $1,348,839 $1,385,562 $1,271,880 $1,997,189 Operating Operating expense 195, , , , ,781 Repairs and maintenance 4,169 3,728 5,775 6,290 5,775 Services 211, , , , ,000 Special projects expenditures 1,500 78,764 31,123 16,100 50,087 Travel 28,048 45,174 47,400 42,015 54,150 Utilities 12,940 14,795 15,245 18,264 16,346 OPERATING SUBTOTAL $453,957 $790,026 $1,318,764 $671,096 $1,405,139 Non-operating Capital (incl. carryover) - 1,929 5,000 2,000 5,000 NON-OPERATING SUBTOTAL $0 $1,929 $5,000 $2,000 $5,000 TOTAL EXPENDITURES $1,758,183 $2,140,794 $2,709,326 $1,944,976 $3,407,329 FUNDING SOURCES, BY FUND General Fund $1,758,183 $1,772,811 $2,211,453 $1,731,054 $2,749,356 Special Revenue Funds - 201, , , ,084 Water Funds - 166, ,572 63, ,889 TOTAL $1,758,183 $2,140,794 $2,709,326 $1,944,976 $3,407,329 CITY OF MENLO PARK BUDGET 65

90 Departmental Summaries Administrative Services Administrative Services Organizational Chart Total FTEs 22.0 Administrative Services Administration 4.0 FTEs Finance 7.0 FTEs Human Resources 5.0 FTEs Information Technology 6.0 FTEs OVERVIEW The Administrative Services Department was created last year to integrate and strengthen the City s financial, human resource and information technology support, required by an evolving and ever more complex organization. The Department s key objective in fiscal year is to continue streamlining processes, enhancing internal controls and improving efficiency with modern technologies. With overall management coordination of the Department s activities provided by the Administrative Services Director and special projects management provided by a Senior Management Analyst, the Department is divided into three functional areas: FINANCE DIVISION The Finance Division coordinates all taxes, fees and investments, prepares and monitors the annual budget, oversees the purchasing process, pays employees and vendors, and manages the City s general liability risk management program. The Division sets and administers fiscal policies and procedures for all City departments ensuring internal control over City assets. The Division provides: Accounting, financial reporting and budget This function performs accounting for all of the City s financial transactions, prepares the citywide annual financial statements (Comprehensive Annual Financial Report or CAFR), compiles the City Manager s proposed budget, monitors the City Council s adopted budget, provides all other financial reporting required by either agreement or statute and enforces internal controls to protect the City s assets against loss. Revenue and risk management This function oversees the City s cash flow to meet cash requirements for operations, collects business license taxes, administers the City s cost recovery program to minimize the use of general tax dollars to support special services, and performs the comprehensive risk management and mitigation function through a Joint Powers Insurance Authority. HUMAN RESOURCES DIVISION The Human Resources Division recruits and retains our well-qualified and diverse workforce that reflects the high standards of the community, maintains positive labor relations, manages workforce safety and succession planning, and administers compensation and benefits. Human Resources also implements Federal, State and local mandates and requirements related to employment. The Division provides: Recruitment and retention This function includes new employee recruitment, selection and onboarding of those with a passion for public service, excellent skills and the ability to take on increasingly complex roles. Surveying and engagement to enhance employees work/life balance and support career development. 66 CITY OF MENLO PARK BUDGET

91 Departmental Summaries Administrative Services Summary FTEs 22.0 Total requested budget Funding sources Advisory Commission $6.19 million Enterprise Fund General Fund Internal Service Fund Special Revenue Fund Finance and Audit INFORMATION TECHNOLOGY DIVISION Classification, compensation and benefits This function ensures application of appropriate classification and compensation principles and regulations; and administers leave and benefit programs for employees, appointed and elected officials and retirees. Employee and labor relations This function encourages effective employer-employee relations by supporting a positive, productive and respectful work environment enhancing employee consultation, recognition and talent management. Staff provides guidance for managers and employees to improve performance, ensure compliance with legal requirements and provide effective problem-solving of complaints and grievances. This function facilitates labor contract negotiations, administration and interpretation. Organizational and employee development This function involves identification and implementation of training and employee development opportunities to support skill enhancement, innovation and leadership. Safety and workers compensation This function manages the organization s workplace safety programs through active risk management aimed at protecting employee health and safety. Staff ensure injured workers receive benefits and care and safely return to work. The Information Technology Division is responsible for the deployment, maintenance and support of the entire organization s technology needs. This includes supporting City operations with effective business technologies consisting of information and telecommunications systems, business software applications, and computer hardware. The Division s goal is to provide a stable and secure technology environment that ensures the continued operation of the City. Network, systems and telecommunications infrastructure At the heart of the City s overall operating technology environment is the underlying core enterprise network and systems infrastructures. The core infrastructure components that enable the City s successful electronic operations include the networking hardware, server systems, data storage, and telecommunications systems. Combined, these infrastructure components create a foundation that effectively operates the City s communications and business software applications. Business systems Enabling City staff to provide a high level of service to the community, the IT Division assists City departments in the evaluation, implementation and support of business applications and technologies used in daily City operations and the effective delivery of community services. End user support The IT Division continually strives to provide a high level of technical support for City staff. Support desk functions include software/hardware installation and configuration, technical problem resolution and end user training. CITY OF MENLO PARK BUDGET 67

92 Departmental Summaries Administrative Services HIGHLIGHTS Finance Recognized by Government Finance Officers Association (GFOA) for the Comprehensive Annual Financial Report for fiscal year and annual budget for fiscal year Utilized recently-upgraded software systems to greatly increase forecast accuracy and transparency in budgeting Increased collaboration with other City departments to improve grant reporting and audit procedures Began a pilot program to embed Finance staff in other City departments to better understand their needs and help to provide exceptional customer service Human Resources Negotiated successor Memoranda of Understanding with three employee bargaining groups: SEIU, AFSCME, and the Police Sergeants Association Improved recordkeeping and data integrity through reorganization efforts, streamlined processes, development of tracking systems, and modernization of practices and procedures Reduced risk of liability through improved preemployment screening processes, human resources staff training on various personnel disciplines, and initiation of a biweekly supervisor training program Opened an average of five recruitments per month throughout the year Information Technology Continued design improvements for core IT network and systems infrastructure Initiated the implementation of the Information Technology Master Plan, a five-year plan identifying the work necessary to enhance public facing technologies Continued progress on the City s land and parcel management system replacement project Launched a new City-wide communications service allowing for increased staff engagement Completed the rollout of new mobile workstation technology for the City Hall remodel project Increased technology delivery and support service levels with the hiring of additional staff BUDGET & INITIATIVES Finance Research best practices and recommend updates to existing financial policies such as purchasing and travel Evaluate alternatives to the current suite of financial reporting software, identify suitable replacements or updates, and create a work plan for selection and implementation Complete cross training among Finance Division staff for succession planning and leave coverage in accounts payable, treasury, financial reporting and risk management. Complete recruiting efforts to fully staff Finance Division Human Resources Explore innovative recruitment strategies to expand and diversify our outreach to qualified job candidates Develop an employee handbook to incorporate into the recently enhanced onboarding process Update and create policies to further reduce City risk of liability and ensure consistent application of rules Successfully integrate transition of the City s Leadership Academy and Employee Engagement Plan activities from other City departments Information Technology Continue IT Master Plan Year 1 initiatives including network and infrastructure enhancements Begin the implementation of the land management system replacement project Begin projects outlined in the IT Master Plan Year 2 initiatives Complete IT staffing recruitment and fill last Division vacancy Continue to review and revise IT policies and procedures to ensure conformity with current industry best practice CITY COUNCIL WORK PLAN ITEMS Information Technology Master Plan Employee Engagement/Organizational Development 68 CITY OF MENLO PARK BUDGET

93 Departmental Summaries Administrative Services CITY OF MENLO PARK BUDGET 69

94 Departmental Summaries Administrative Services Est. ADMINISTRATIVE SERVICES WORKLOAD INDICATORS Finance Number of payroll checks/direct deposits ,373 11,528 11,264 Number of vendor payments ,361 3,800 4,100 Number of new business licenses Number of business license renewals Number of separate funds included in annual financial statements Number of annual regulatory reports/audits completed and submitted to the appropriate agency Human Resources Number of recruitments Number of new hires Meetings with bargaining units Number of employee trainings Number of open Workers Compensation claims Number of new/active grievances filed Number of new/active administrative investigations Number of new/active employee discipline cases Number of new/active Meet & Confer requests from bargaining units 13 n/a n/a n/a Number of new/active Fair Employment inquiries Number of open successor MOU negotiations Information Technology City facilities networked Computer workstations supported Emergency services mobile and fixed computers supported Monthly average of completed helpdesk tickets Network devices and appliances Server and Desktop Applications Supported Servers supported Telephones supported User/ Accounts CITY OF MENLO PARK BUDGET

95 Departmental Summaries Administrative Services Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $1,453,697 $1,677,535 $2,092,957 $1,799,673 $2,217,247 Temporary salaries 82, ,310 30,000 83,000 50,000 Overtime 33,111 46,247 26,000 2,500 41,000 Vacation cash-out 141,886 91,776 13,454 77,000 54,000 SALARIES AND WAGES SUBTOTAL $1,711,634 $1,933,868 $2,162,411 $1,961,813 $2,362,247 CalPERS Pension 252, , , , ,673 Insurances (health, dental, vision, life, medicare) 934,030 1,008,083 1,140, , ,139 Workers Comp, OPEB allocations, other 82, , , , ,500 FRINGE BENEFITS SUBTOTAL $1,268,431 $1,418,044 $1,641,633 $809,892 $1,076,312 PERSONNEL SUBTOTAL $2,980,065 $3,351,911 $3,804,044 $2,771,705 $3,438,558 Operating Operating expense 2,518,389 2,747, , , ,358 Repairs and maintenance 6,414 14,009 5,400 4,000 7,900 Services 877,111 1,225,817 1,914,213 1,874,200 1,696,770 Special projects expenditures , , Travel 13,337 21,615 23,900 27,600 49,000 Utilities 34,609 43,127 40,900 48,468 39,109 OPERATING SUBTOTAL $3,449,928 $4,329,558 $2,980,021 $2,505,426 $2,503,137 Non-operating Capital (incl. carryover) 123, , , , ,965 Transfers 266, NON-OPERATING SUBTOTAL $389,096 $374,455 $129,065 $188,000 $252,965 TOTAL EXPENDITURES $6,819,088 $8,055,924 $6,913,131 $5,465,132 $6,194,660 FUNDING SOURCES, BY FUND General Fund $2,407,383 $2,898,747 $2,850,286 $3,183,474 $3,117,095 Special Revenue Funds 52,449 20,339 2,304 8,940 15,842 Water Funds 530, , , , Internal Service Funds 3,827,340 4,715,271 3,546,833 2,133,533 3,035,156 Debt Service Funds 1, ,263 TOTAL $6,819,088 $8,055,924 $6,913,131 $5,465,132 $6,194,660 CITY OF MENLO PARK BUDGET 71

96 Departmental Summaries Community Development Community Development Organizational Chart Total FTEs 31.0 Community Development Administration 3.0 FTEs Planning Division 13.0 FTEs Building Division 12.0 FTEs Housing and Ecomomic Development 3.0 FTEs OVERVIEW The Community Development Department is responsible for ensuring a sustainable and vibrant community that supports economic well-being and a high quality of life for residents, businesses and visitors. This Department is comprised of the Planning and Building Divisions, as well as the Office of Housing and Ecomomic Development. Core services performed by the Department include: CURRENT PLANNING Current planning provides comprehensive services for obtaining information and assistance with required approvals for land use development projects in compliance with regulations. This includes providing potential project applicants and interested parties with timely and accurate information regarding city policies, ordinances, regulations, guidelines and other requirements related to land use development. Additionally, this Division provides expeditious, thorough and structured review of proposed development projects, including environmental review, fiscal impact analysis, historic review and other technical analyses that evaluate the merits of a project leading to a City entitlement decision. LONG RANGE PLANNING The key focus of long range planning is developing, monitoring, updating and integrating land use, economic, transportation and environmental policies to achieve Citywide goals and improve the physical and economic environment of the community. This is accomplished primarily through the General and Specific Plans and other related documents that establish goals, policies and implementation strategies guiding future City decisions to enhance the quality of life. BUILDING PERMITTING & INSPECTION SERVICES Building permitting and inspection protects the health, safety and welfare of the community by providing information on the building permit process, interpreting the California Building Standards Code and municipal codes, as well as maintaining historic property records. This Division also coordinates interdepartmental and interagency review of project plans and reviews plans and inspects construction sites for compliance with all State and Municipal codes relating to structural, mechanical, plumbing, electrical and grading. 72 CITY OF MENLO PARK BUDGET

97 Departmental Summaries Community Development Summary FTEs 31.0 Total requested budget Funding sources Advisory Commission $8.87 million General Fund Special Revenue Fund Planning, Housing HOUSING & ECONOMIC DEVELOPMENT This Office manages the City s affordable housing programs, encompassing below market rate housing, purchase assistance loans and affordable housing units in new developments. Recent housing development activities will soon bring new affordable units to the community. In addition, this Office addresses business needs and provides opportunities for business success including identifying new businesses enhancing the community and the City s economic health. Acting as a business concierge, staff helps obtain, thorough and effective development approvals. This includes outreach to local businesses, referrals to State and Federal programs, strategic planning for expansion approval and marketing/networking opportunities. The staff collaborates with a number of economic development associations, communitybased organizations and State and Federal resources to market Menlo Park as an attractive location for businesses HIGHLIGHTS Completed land use entitlement review of the Stanford 500 El Camino Real/Middle Plaza project containing 215 residential units, 143,000 sq. ft. of non-medical office space, 10,000 sq. ft. of retail/ restaurant uses and a.5 acre public plaza. Completed a Specific Plan Amendment and land use entitlements to redevelop the Guild Theatre into a live performance venue. Completed land use entitlement amendments for the Facebook West Campus expansion containing 1 million square feet of office uses, a 200-room hotel and a 2-acre public plaza connecting to a pedestrian bridge with access to the Bayfront Trail. Land use review was completed for two in-fill mixed-use developments within the El Camino Real/ Downtown Specific Plan Area. Continued implementation of the ConnectMenlo General Plan including development of new community amenity appraisal and green building programs. Processing of over 20 new discretionary land use reviews for several large mixed-use, commercial and residential projects in the Downtown and Bayfront areas, including the proposed 60-acre Facebook Willow Village mixed-use neighborhood. Adoption of Cannabis land use regulations consistent with new State law. Completed review of the Housing Element Annual Report, Housing Successor Report and updated the City s BMR Guidelines to reflect changes in State law. Completion and tenant occupation of Menlo Gateway Phase I, including plan review and inspections of a new 11-story 250-room hotel, 200,000 sq. ft. 8-story office building and a multi-level parking structure. Also, issued demolition permits and reviewed building permits for Menlo Gateway Phase II, including two new office buildings and two new parking structures. Occupancy granted to Facebook Building 21, a new 500,000 sq. ft. office building. Building permits also issued for Facebook Building 22, a new 450,000 sq. ft. office building. Issued building permits for 1300 El Camino Real/ Station 1300 project, containing 183 residential units and 220,000 sq. ft. of commercial uses. Managed ongoing construction of major projects including: 1400 El Camino Real hotel, 1010 Alma Street office building, 1285 El Camino Real mixeduse project, 133 Encinal residential development and Fire Station #6 on Oak Grove Avenue. Began the implementation of electronic plan review, beginning with an electronic review of Facebook Building 22. Completed successful recruitments for two Senior Planners, Planning Technician and Permit Technician positions. CITY OF MENLO PARK BUDGET 73

98 Departmental Summaries Community Development BUDGET & INITIATIVES The Department continues to see a high level of development interest primarily driven by a thriving economy, adoption of long range planning documents, including the El Camino Real/Downtown Specific Plan, the Housing Element and the 2016 General Plan and M-2 Area Zoning Update. The budget reflects higher revenues due to an increased number and complexity of development projects, as well as a corresponding increase in contract services expenses. Planning, building permitting and inspection services are self-supporting through fees set to recover service costs. Not all services are fully cost recovered, and non-personnel related expenditures remain largely unchanged from fiscal year INITIATIVES Commence the El Camino Real/Downtown Specific Plan Biennial Review, including development of a project work plan, budget and contract services for potential plan amendments. The continued review of over 20 new discretionary land use reviews for several large mixed-use, commercial and residential projects, including the proposed 60-acre Facebook mixed-use neighborhood. Commence the ConnectMenlo General Plan Biennial Review, including identification of potential amendments. Development of new City wide requirements for electrical vehicle charging stations. Develop a work plan and conduct public outreach to update the Zoning Ordinance requirements for single-family residential development. Implement Housing Element programs, including adoption of an anti-discrimination ordinance to prohibit discrimination based on the source of a person s income or use of rental subsidies. The ongoing management and occupancy of major construction projects including the afore-mentioned Facebook and other residential and mixed-use developments. Continued implementation of electronic plan review and an enhanced land management system. CITY COUNCIL WORK PLAN ITEMS Implement El Camino Real/Downtown Specific Plan Biennial Review Guild Theatre Land Use Entitlement Approval Downtown Parking Garage Revisions to the 2016 California Green Building Standards Code for Electrical Vehicle Chargers Single Family Residential Requirements and Guidelines 74 CITY OF MENLO PARK BUDGET

99 Departmental Summaries Community Development CITY OF MENLO PARK BUDGET 75

100 Departmental Summaries Community Development Est. COMMUNITY DEVELOPMENT WORKLOAD INDICATORS Administrative permits reviewed City Council reports Commercial building permits issued Community workshops and meetings supported or staffed Development review team meetings conducted Environmental documents prepared Inspections conducted 10,486 10,835 9,200 13,345 Land use applications received Planning Commission reports Public notices mailed 81,681 70,769 43,600 35,000 Public notices prepared Residential building permits issued Sign applications reviewed Zoning compliance letters prepared Economic Development* Business attraction leads Business retention visits Economic Development community events New Business welcome letters Housing* New housing ordinances City Council Study Session Housing Commission agendas Outstanding loans New affordable housing units funded/approved *Housing and Economic Development previously reported in the City Manager s department budget 76 CITY OF MENLO PARK BUDGET

101 Departmental Summaries Community Development Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $2,177,189 $2,623,696 $3,212,117 $2,920,469 $3,482,727 Permanent part-time salaries 77,566 77,544-97,580 95,981 Temporary salaries 84,636 6,923 23,000 32,500 23,000 Overtime 21,159 37,214 40,000 30,000 40,000 Vacation cash-out 8,936 17,572 13,354 80,000 55,000 SALARIES AND WAGES SUBTOTAL $2,369,486 $2,762,948 $3,288,471 $3,160,549 $3,696,709 CalPERS Pension 393, , , , ,987 Insurances (health, dental, vision, life, medicare) 454, , , , ,801 Workers Comp, OPEB allocations, other 141, , , , ,800 FRINGE BENEFITS SUBTOTAL $990,039 $1,161,349 $1,339,186 $1,310,788 $1,745,588 PERSONNEL SUBTOTAL $3,359,525 $3,924,297 $4,627,657 $4,471,337 $5,442,296 Operating Operating expense 347, , , , ,568 Repairs and maintenance 9,238 3,536 17,750 6,000 17,750 Services 2,777,062 1,734,298 2,348,502 1,607,000 2,596,234 Special projects expenditures 30,645 16,155 23,500 19,000 23,500 Travel 9,939 6,643 18,200 10,500 18,200 Utilities 19,819 21,817 20,900 21,210 22,030 OPERATING SUBTOTAL $3,193,761 $2,264,535 $3,072,785 $2,266,033 $3,420,283 Non-operating Capital (incl. carryover) 7,029-7,000 1,000 7,000 NON-OPERATING SUBTOTAL $7,029 $0 $7,000 $1,000 $7,000 TOTAL EXPENDITURES $6,560,315 $6,188,832 $7,707,442 $6,738,370 $8,869,579 FUNDING SOURCES, BY FUND General Fund $4,238,100 $4,977,064 $7,311,094 $6,591,225 $8,327,888 Special Revenue Funds 1,086, , , , ,291 Capital Improvement Funds 1,224, ,358 13,535 9,458 9,400 Debt Service Funds 10, TOTAL $6,560,315 $6,188,832 $7,707,442 $6,738,370 $8,869,579 CITY OF MENLO PARK BUDGET 77

102 Departmental Summaries Community Services Community Services Organizational Chart Total FTEs Community Services Administration 2.0 FTEs Child Care 27.5 FTEs Community Centers and Gymnastics FTEs Special Events, Sports and Recreation FTEs OVERVIEW The Community Services Department provides recreation programs, social services and facilities enriching the lives of Menlo Park and other area residents. The Department s goals are supporting healthy lifestyles, helping people learn new things and providing opportunities to connect with one another as a community. Community Services includes activities in 10 different facilities totaling 130,000 square feet, featuring a state-of-the-art gymnastics center, two gymnasiums, two community centers, three child care centers, two community pools and a senior center. Additionally, this Department hosts citywide special events, a summer concert series and programs at the local performing arts center. In addition to the full-time equivalents staff, another 125 temporary staff support the more than 1 million participant hours offered each year. SPORTS & RECREATION Adult Sports including basketball leagues, softball leagues and volleyball classes are offered. There are also drop-in opportunities for basketball, volleyball, floor hockey and badminton. Community Services also offers specialty programming such as Team Fitness and Menlo Swim and Sport providing boot camp fitness classes. Youth Sports include basketball leagues, a girls volleyball league and the Kids Love Soccer program. The Department also sponsors AAU basketball tournaments and provides contract classes including basketball, golf, tennis and winter sports clinics. Menlo Park Gymnastics provides very popular gymnastics programs, including an extensive preschool program and both boys and girls competitive teams. The Arrillaga Family Gymnastics Center offers inclusive programs for special needs children, circus arts classes and rentals for community meetings and fitness classes. Youth and adult recreation classes at our two recreation centers include health and fitness, dance, martial arts, cooking, art, music, performing arts, crafts, horseback riding, sports (including ice skating, hockey, soccer, tennis, basketball and baseball), computer skills, English as a Second Language (ESL) and more. Aquatics programming is provided through a contractor agreement with Team Sheeper, Inc. and includes yearround programming at both the Burgess and Belle Haven Pools. Other recreation facilities include tennis courts, a skate park, picnic areas, sports fields, two dog parks and Bedwell Bayfront Park, a 160-acre open space area with walking trails along San Francisco Bay. 78 CITY OF MENLO PARK BUDGET

103 Departmental Summaries Community Services SPECIAL EVENTS Ten major community events are held each year, as well as an eight-week summer concert series and movie series. These events include Kite Day, Fourth of July Parade and Celebration, Annual Downtown Block Party, Movies in the Park, Halloween Hoopla Costume Parade, Breakfast with Santa, Holiday Tree Lighting, Egg Hunt and more. The Community Services Department also programs the Menlo-Atherton Performing Arts Center for 55 days per year with a combination of rentals and citysponsored programs, including the Music at Menlo summer festival, Kepler s Arts and Lectures, children s concerts and sing-alongs, movie nights and local performing arts groups which are supported by a Grant for the Arts program. CHILD CARE & TEEN ACTIVITIES The Belle Haven Child Development Center provides licensed, subsidized child development services for income-qualified children ages 3 5 and is partially funded through State grants. The program includes a nutritional component. The Menlo Children s Center provides licensed child care for ages 18 months through five and a half years old, as well as after-school care for school-aged children. A full-day summer camp program is also provided. All care includes a nutritional component, academic support and transportation from local schools. Summary FTEs Total requested budget Funding sources Advisory Commission $9.81 million General Fund Special Revenue Fund Trust Agency Fund Parks and Recreation The Belle Haven Youth Center houses the Belle Haven After-School Program, providing licensed child care for school-aged children, as well as a full-day summer camp program. A nutritional component, homework program and transportation from local schools are included. SENIOR SERVICES The Menlo Park Senior Center offers classes, social services, special events, recreation and social activities, for older adults and residents over the age of 55. Programs include nutrition and exercise programs for older adults, arts and crafts, peer counseling, a men s social hour, insurance counseling, ESL courses, dance and fitness classes. Nutritious daily meals are offered and are prepared in-house. CITY OF MENLO PARK BUDGET 79

104 Departmental Summaries Community Services HIGHLIGHTS Continue to implement five-year strategic plan update approved in 2016 Expanded social media and non-traditional marketing efforts to increase participation in all programs Completed the Belle Haven Child Development Center Remodel Completed the Belle Haven Pool Audit and Master Plan project Completed the Bedwell Bayfront Park Master Plan project Completed the RFQ proposals for Nealon Park, Burgess Park and Willow Oaks Park Playground Improvement Project and selected project consultant Completed the Nealon Park Sports Field renovation project Completed the Renaming of Marketplace Park to Karl E. Clark Park Negotiated professional services agreement with private contractor to provide aquatics programs Maintained an overall cost recovery level for the Department that is among the highest in the Bay Area BUDGET & INITATIVES The Community Services Department budget reflects the new agreement for aquatics programs, as the City assumes some pool expenses that include repairs and maintenance, utilities, chemicals and utilities. As program participation continues to increase and the labor market in the Bay area continues to tighten, the Department s extensive use of temporary staff has become a challenge. The Department s budget also includes additional funding for twice the number of Grants for the Arts, allowing more area arts organizations access to the Performing Arts Center. INITIATIVES Improve opportunities for volunteerism at community events Explore emerging sports trends and opportunities to expand programs Explore opportunities to expand programming at Onetta Harris Community Center and the Senior Center in Belle Haven Complete analysis of after school programs and determine future direction given changing community needs Continue refinements to program marketing, capacity analysis and program delivery Continue increasing sponsorships and partnerships Complete the Parks and Recreation Facilities Master Plan Update Implement the City Council s decisions on the Updated Cost Allocation Plan CITY COUNCIL WORK PLAN ITEMS Parks and Recreation Facilities Master Plan Update Bedwell Bayfront Park Master Plan Update Burgess Park Snack Shack Community Services Strategic Plan Implementation Est. COMMUNITY SERVICES WORKLOAD INDICATORS General Fund Subsidy per participant hour $1.21 $1.22 $0.88 $0.90 Field usage percentage 87% 88% 84% 81% Programs within the City Council cost recovery target 100% 100% 100% 100% Recreation programs conducted 14,020* 19,242** 20,000** 19,720 Special events and performing arts programs attendance 12,750 17,000 17,000 17,000 Total annual participant hours 1,212,319 1,250,000 1,400,000 1,375,000 Total annual participants 21,910 22,100 22,648 22,211 * previously counted recreation programs only ** includes recreation and social services programs 80 CITY OF MENLO PARK BUDGET

105 Departmental Summaries Community Services Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $2,434,586 $2,761,980 $2,906,011 $2,924,247 $3,173,637 Permanent part-time salaries 290, , , , ,616 Temporary salaries 951, , , , ,850 Overtime 30,617 54,441 44,250 57,750 56,550 Vacation cash-out 50,275 47,567 22,708 49,000 40,000 SALARIES AND WAGES SUBTOTAL $3,757,806 $4,013,245 $4,135,318 $4,095,321 $4,400,652 CalPERS Pension 460, , , , ,999 Insurances (health, dental, vision, life, medicare) 944, , , ,641 1,186,332 Workers Comp, OPEB allocations, other 195, , , , ,700 FRINGE BENEFITS SUBTOTAL $1,600,426 $1,828,323 $1,851,991 $1,878,178 $2,342,031 PERSONNEL SUBTOTAL $5,358,232 $5,841,569 $5,987,309 $5,973,498 $6,742,683 Operating Operating expense 710, ,311 1,075, ,861 1,399,267 Repairs and maintenance 50,178 34, ,600 63,900 79,600 Services 846, , , ,050 1,003,504 Special projects expenditures 165, ,000 22,728 22,000 Travel 17,281 23,410 17,200 21,050 24,000 Utilities 387, , , , ,046 OPERATING SUBTOTAL $2,176,876 $2,110,644 $2,500,976 $2,351,489 $2,992,417 Non-operating Capital (incl. carryover) 93, ,258 85,500 89,001 73,060 NON-OPERATING SUBTOTAL $93,767 $105,258 $85,500 $89,001 $73,060 TOTAL EXPENDITURES $7,628,875 $8,057,471 $8,573,785 $8,413,989 $9,808,160 FUNDING SOURCES, BY FUND General Fund $7,628,875 $8,057,471 $8,573,785 $8,413,989 $9,808,160 TOTAL $7,628,875 $8,057,471 $8,573,785 $8,413,989 $9,808,160 CITY OF MENLO PARK BUDGET 81

106 Departmental Summaries Library Library Organizational Chart Total FTEs 18.5 Library Administration 4.5 FTEs Adult Services/Reference 3.25 FTEs Belle Haven Branch 1.5 FTEs Circulation Services 3.75 FTEs Technical Services 1.0 FTEs Literacy Services (Project Read) 1.5 FTEs Youth Services 2.5 FTEs OVERVIEW The Menlo Park Library is the community s focal point for information, learning and culture. The Library is equally accessible to people of all interests and ages, ready to help residents develop and apply new knowledge. The library includes a main central library, the Belle Haven Branch Library, and a robust virtual library available 24/7. The Library provides borrower services, public information and specialized services for children, teens, adults and recent immigrants. The Library is in the top seven percent for circulation per capita among all 181 public libraries in California. This Department provides the following services: ADULT SERVICES/REFERENCE These services include the selection and management of adult fiction and nonfiction materials (in print and electronic format), periodicals, audio books, music CDs, movies and documentaries. The Library also provides reference and reader advisory services, informational and cultural programs, and online access to databases, pathfinders and other advisory aides through the library website. Project Read, the Library s adult literacy program, teaches adult learners to read and write in English. The program holds regular training sessions to train volunteers who provide one-on-one tutoring. Summary FTEs 18.5 Total requested budget Funding sources Advisory Commission YOUTH SERVICES $3.89 million Library Bond Fund Expendable Trust Fund General Fund Special Revenue Fund Library Staff provide assistance to children from infancy through high school including reference and readers advisory services, story times to build early literacy skills, craft programs, special guest enrichment programs (like musical events, parent education events and author visits), school visits, the Summer Learning Challenge and the teen advisory group. CIRCULATION SERVICES This service manages the lending and return of library materials, and assists library users with the self-check terminals, the automated return machine, and with issuing library cards. 82 CITY OF MENLO PARK BUDGET

107 Departmental Summaries Library TECHNICAL SERVICES These services involve physical and electronic cataloging so that materials can be easily found by users. Technical services also provides the labeling, packaging and inventory of all items in the library s collection. BELLE HAVEN BRANCH LIBRARY SERVICES The Belle Haven Branch Library, located on the campus of the Belle Haven Elementary School, offers the full range of library services. This branch has shifted its focus from elementary school curriculum support and expanded services for adults and families. Project Read s English as a Second Language (ESL) classes are held here twice a week HIGHLIGHTS Began the Belle Haven Neighborhood Library Needs Assessment Formed the Belle Haven Neighborhood Library Advisory Committee to assist with the Assessment Added 13 open hours to the branch for a total of 34 per week including Saturday and Sunday Refurbished Belle Haven Branch interior and expanded Branch collection for adults Gathered community input during three Main Library Siting and Uses meetings as part of the study of the need for a new Main Library BUDGET & INITIATIVES For the fiscal year, funds will be requested for a space needs study for a new Belle Haven branch and for a conceptual design for a new Main Library, continuing the work of the Library System Improvements project approved by Council. Programming has become an increasingly important part of the library s service to the community, and funds will be requested to expand offerings and conduct more of the larger scale programs that are popular with our users. Additional funds will be requested for Project READ, the library s adult literacy program, to reduce reliance on uncertain State grants and to expand the program s offerings to the community. Funds are being requested for a Comprehensive Staff Development program to continue the professional growth of library staff so that they may continue to enhance the services that are provided. Additional permanent staff are being requested so that the library will have sufficient staff to carry-on and expand its robust variety of services to the community. CITY COUNCIL WORK PLAN ITEMS Library System Improvements Project CITY OF MENLO PARK BUDGET 83

108 Departmental Summaries Library * Est. LIBRARY WORKLOAD INDICATORS All locations School aged program attendance - 3,852 6,797 7,000 Adult program attendance - 1,907 2,100 2,200 Electronic book usage - 31,833 56,302 60,000 Main Library Collection usage - 543, , ,000 Library visits - 352, , ,000 Belle Haven Branch Library Collection usage - 12,781 19,041 20,000 Library visits ,550 12,000 *workload indicators revised for budget, historical not available. 84 CITY OF MENLO PARK BUDGET

109 Departmental Summaries Library Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $678,521 $737,403 $870,697 $921,315 $1,302,522 Permanent part-time salaries 324, , , , ,646 Temporary salaries 396, , , , ,500 Overtime 9,190 14,598 15,000 10,000 15,000 Vacation cash-out 7,546 13,438 2,678 4,000 4,000 SALARIES AND WAGES SUBTOTAL $1,417,058 $1,481,974 $1,723,925 $1,503,330 $1,995,668 CalPERS Pension 170, , , , ,039 Insurances (health, dental, vision, life, medicare) 217, , , , ,556 Workers Comp, OPEB allocations, other 61,973 59,361 84,579 84, ,300 FRINGE BENEFITS SUBTOTAL $450,021 $493,939 $602,873 $552,995 $866,895 PERSONNEL SUBTOTAL $1,867,079 $1,975,913 $2,326,798 $2,056,325 $2,862,563 Operating Operating expense 323, , , , ,025 Repairs and maintenance 164, , , , ,700 Services 25,263 69, , ,000 34,520 Special projects expenditures Travel 300 2,350 3, ,700 Utilities 85,678 79,415 76,200 72,324 76,433 OPERATING SUBTOTAL $599,691 $738,841 $933,284 $825,788 $937,378 Non-operating Capital (incl. carryover) 23,803 31, ,305 88,000 90,200 NON-OPERATING SUBTOTAL $23,803 $31,084 $151,305 $88,000 $90,200 TOTAL EXPENDITURES $2,490,573 $2,745,838 $3,411,387 $2,970,113 $3,890,141 FUNDING SOURCES, BY FUND General Fund $2,242,090 $2,516,864 $3,065,053 $2,845,227 $3,572,577 Special Revenue Funds 248, , , , ,564 TOTAL $2,490,573 $2,745,838 $3,411,387 $2,970,113 $3,890,141 CITY OF MENLO PARK BUDGET 85

110 Departmental Summaries Police Police Organizational Chart Total FTEs 77.5 Police Administration 2.0 FTEs Patrol Operations 46.5 FTEs Special Operations 29.0 FTEs OVERVIEW The Police Department is a full-service police agency responsible for enhancing and ensuring public safety by protecting lives and property, preventing crime, maintaining public order, thoroughly investigating crimes, enforcing Municipal Codes and connecting with community. Operationally, this department provides the following services: ADMINISTRATION The Administrative Division consists of department command staff, records, property & evidence, police training and emergency preparedness personnel. This includes department operations where records staff processes citations subpoenas, parking permits, crime statistics reporting, property and evidence management, coordination with the District Attorney s office and preparing case information. Additionally, this division is responsible for the professional development of police employees by planning and implementing training that meets or exceeds legal mandates. The division coordinates with the Menlo Park Fire Protection District on emergency preparedness plans and training. PATROL The Patrol Services Division is the most visible part of the Police Department, consisting of uniformed officers and professional staff who are making contact with residents, business owners and visitors on a daily basis. Patrol Services provides the first level of police response to a myriad of emergency and non-emergency calls. During FY , the Patrol Services Division handled over 39,000 calls for service. Patrol Services include: traffic and parking enforcement, community service and community safety police officer programs, code enforcement, special events coordination, SWAT, field training, traffic collision investigation team and the crisis intervention team. INVESTIGATIONS The Investigations Division is comprised of the General Investigations Unit and the Special Investigations Unit. The General Investigation Unit handles all assigned general criminal investigations while assisting patrol services at major crime scenes or with other complicated cases. Cases range from burglaries and robberies to large-scale frauds including identity theft, crimes against children, sexual assaults and homicides. 86 CITY OF MENLO PARK BUDGET

111 Departmental Summaries Police The Special Investigations Unit consists of four specialized detectives and one sergeant. This unit conducts street level enforcement combating narcotics and gang violence, and is a flexible unit able to address any other crime trend emerging within the city. Additionally, it conducts periodic probation and parole checks, undercover operations, coordinating and working collaboratively with other law enforcement organizations and task forces on a variety of quality of life concerns. DISPATCH The public safety dispatch center is operational 24/7 including holidays and weekends in order to receive service calls from the public (and other agencies) as well as support officers via radio communications, and is considered an area Public Safety Answering Point (PSAP). Dispatchers run suspect and premise checks, verify identification and enter various other information into statewide databases, i.e., stolen vehicles, stolen property or missing persons. Our state-of-the-art dispatch center receives 911 calls from landline, VOIP and cellphone callers, and is set to begin receiving text to 911 calls in this fiscal year. In the past year, ninety-eight percent of the over 10,000 emergency calls were answered in 10 seconds or less HIGHLIGHTS Graduated 21 community members from our Youth Community Police Academy Hosted a Friday Night Lights community engagement event Sponsored eight new police officers who graduated from the College of San Mateo and Coyote Valley Police Academies Continued training department staff in Resilience Immersion Training also known as Mindfulness Training Continued training in mindfulness through the Compassion Cultivation Training (CCT) sponsored by Stanford University New communication antenna was installed and is now operational Initiated the Bayfront Beat 4 project Filled 15 vacant positions, including 12 sworn officer positions Summary FTEs Total requested budget Funding sources (54 sworn) $19.95 million BUDGET & INITIATIVES General Fund Special Revenue Funds Capital Improvement Funds The Police Department s budget remains largely unchanged from fiscal year Minor changes include non-personnel expenditures which were adjusted to consider historical spending and known increases in existing service contracts. Like many of our allied law enforcement agencies across the state, one of our primary goals in the coming fiscal year will be recruiting to fill our current and anticipated vacancies. The city council s approval of the development agreement with Facebook, has increased our sworn officer allocation from 48 to 54. As new officers begin to complete training, a new Beat-4 will be activated which will allow officers assigned to the Belle Haven neighborhood to remain in that area addressing specific needs of the neighborhood, while other officers will be assigned to the M-2 area. Additionally, recent retirements have created vacancies in our traffic enforcement unit. In the next budget cycle, the police department will strive to fill vacancies in the traffic unit along with efforts at addressing the increase in code enforcement requests. CITY OF MENLO PARK BUDGET 87

112 Departmental Summaries Police Est. POLICE WORKLOAD INDICATORS Patrol calls for service 21,293 22,000 21,487 23,500 Vehicle stops 10,899 11,000 8,848 8,800 Pedestrian stops 11,910 12,000 9,728 10,000 Detective cases assigned Serious crime clearance rate 60% 60% 77% 64% Property crime clearance rate 13% 15% 13% 13% Overall clearance rate 32% 30% 27% 21% Dispatch calls for service 39,605 40,000 39,122 40, emergency calls 11,180 11,000 10,179 11,000 Calls answered in 10 seconds or less 10,221 10,000 9,255 10,000 Cases reviewed and processed 3,937 4,000 3,985 3,900 Parking citations processed 8,587 12,000 14,056 13,000 Moving citations processed 7,822 7,200 5,309 4, CITY OF MENLO PARK BUDGET

113 Departmental Summaries Police Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $7,919,319 $8,221,313 $8,704,400 $8,087,402 $9,723,974 Permanent part-time salaries 29,658 20,999 75,115 11,346 30,452 Temporary salaries 216, , , , ,000 Overtime 868, , , , ,000 Vacation cash-out 194, ,697 91, , ,000 SALARIES AND WAGES SUBTOTAL $9,228,984 $9,510,034 $9,767,754 $9,561,783 $11,061,425 CalPERS Pension 1,909,409 2,134,213 1,988,978 2,181,130 2,532,430 Insurances (health, dental, vision, life, medicare) 1,232,737 1,305,607 1,401,002 1,330,998 1,697,073 Workers Comp, OPEB allocations, other 839,304 1,012,501 1,247,618 1,247,618 1,049,300 FRINGE BENEFITS SUBTOTAL $3,981,450 $4,452,321 $4,637,597 $4,759,746 $5,278,803 PERSONNEL SUBTOTAL $13,210,434 $13,962,355 $14,405,351 $14,321,529 $16,340,228 Operating Operating expense 1,624,509 1,880,760 2,377,261 2,323,732 1,966,933 Repairs and maintenance 209, , , , ,674 Services 655, , , , ,187 Special projects expenditures 92,500 97, , , ,000 Travel ,500-3,500 Utilities 123, , , , ,338 OPERATING SUBTOTAL $2,705,893 $2,862,900 $3,920,839 $3,742,398 $3,518,631 Non-operating Capital (incl. carryover) 109,689 86,677 94,200 13,300 93,500 NON-OPERATING SUBTOTAL $109,689 $86,677 $94,200 $13,300 $93,500 TOTAL EXPENDITURES $16,026,017 $16,911,932 $18,420,390 $18,077,226 $19,952,359 FUNDING SOURCES, BY FUND General Fund $15,874,455 $16,797,584 $18,294,690 $18,053,676 $19,812,859 Special Revenue Funds 145, , ,300 5, ,500 Capital Improvement Funds 6,228 8,794 21,400 18,000 18,000 TOTAL $16,026,017 $16,911,932 $18,420,390 $18,077,226 $19,952,359 CITY OF MENLO PARK BUDGET 89

114 Departmental Summaries Public Works Public Works Organizational Chart Total FTEs 70.0 Public Works Administration 5.0 FTEs Engineering 13.0 FTEs Transportation 18.0 FTEs Maintenance 34.0 FTEs OVERVIEW The Public Works Department is responsible for building and maintaining the City s infrastructure and facilities, and for providing street, sidewalk, water, stormwater, parks, trees and transportation services. The Department protects the City s investments in infrastructure and public facilities to ensure the health and safety of the community in an efficient, sustainable and cost effective manner. This Department consists of three Divisions: Engineering, Maintenance and Transportation. Engineering has three sections: Capital Improvement Plan, Utilities and Development Services. ENGINEERING DIVISION Capital improvement section This section manages the City s capital improvements, including construction and maintenance of City infrastructure and facilities. The design of capital improvement projects is done in-house or in conjunction with professional consultants. Capital improvement projects are publicly and competitively bid and built by general contractors. Each year, this Section assesses the infrastructure needs and develops a five-year improvement plan and budget. These projects include street improvements, and rehabilitation of city facilities. The program is managed by staff and supported by consulting firms. Summary FTEs 70.0 Total requested budget Funding sources Advisory Commission $79.47 million* Capital Improvem Fund General Fund Internal Service Fund Special Revenue Fund Water Enterprise Fund Complete Streets *includes Capital Improvement Plan current year, carryover, and encumbered funds. Development services section The Development Services Section ensures that private development and activities within the public-right-ofway meet the required standards and conditions set by the City. The Section manages encroachment permits for private developers, utility companies, property owners and contractors working within the City s public right-of-way ensuring that the infrastructure constructed both on private property and in the public-right-of-way meets the appropriate engineering standards and regulatory requirements for grading, drainage, Federal Emergency Management Agency compliance and stormwater management. Development Services provides timely comprehensive plan review and inspection. Given the number of large projects currently in development (Facebook, Station 90 CITY OF MENLO PARK BUDGET

115 Departmental Summaries Public Works 1300 (1300 El Camino Real), Park James Hotel (1400 El Camino Real), Middle Plaza (500 El Camino Real) mixed-use development, Alma Station (1010 Alma Street), 133 Encinal Avenue residential project, Menlo Gateway, etc.) and the overall increase in private development, the Section also depends on consultants for plan checking and contract inspectors. Utilities section The Utilities Section manages Menlo Park Municipal Water, the City s storm drain system and the leachate and gas collection systems at Bedwell Bayfront Park. Menlo Park Municipal Water provides safe and reliable potable water to 16,000 customers through 55 miles of water mains and 4,000 service connections, ensuring that water quality meets Federal Safe Drinking Water Act standards. The water distribution system includes a pump station and two reservoirs holding 5.5 million gallons of potable water. The Utilities Section manages new water connections, oversees the cross-connection control program, handles water billing, enforces water conservation regulations, evaluates potable water reliability and alternate sources of water, and develops and manages the water infrastructure, such as emergency well and water main replacements. As part of the stormwater management effort, the Utilities Section assesses flood risk and storm preparedness, plans for flood protection and infrastructure needs, handles sea level rise and hazard mitigation, implements pollution prevention policies ensuring compliance with the National Pollution Discharge Elimination System permits, meets regulatory requirements protecting creek and bayland habitats and coordinates with regional entities on stormwater management. Stormwater CIP projects are also developed and managed by the Utilities Section. The City owns Bedwell Bayfront Park, a former landfill that closed in The Utilities Section manages the leachate and gas collection, handles systems in accordance with the State Water Resources Control Board and Bay Area Air Quality Management District regulations, and plans for capital improvements. MAINTENANCE DIVISION The Maintenance Division provides many of the basic services affecting the daily lives of everyone living, working, visiting and commuting within the City. This Division supports all other departments through facilities, parks, fleet, trees and streets. Facilities section Facilities provides operations, maintenance and repair services for the 26 City-owned facilities, totaling over 250,000 square feet. The Facilities Section is managed by staff and supported by contractors to manage commercial kitchens, elevators, burglar alarms, fire alarms, interior and exterior surfaces, heating, ventilation, air conditioning, pest control, electrical power, lighting and more. Facilities staff also manage minor remodel and repair projects. Fleet section The Fleet Section acquires and disposes of vehicles and equipment, provides preventive maintenance and repairs on vehicles and equipment, and purchases parts and accessories. Currently, the Section maintains 200 vehicles and large pieces of equipment, 50 small pieces of equipment and four emergency generators. The Section also maintains the underground fuel storage tank system and sells fuel to four outside agencies via shared service agreements. Currently, the Section also maintains 30 vehicles and pieces of equipment for the West Bay Sanitary District. Parks section Parks maintains and renovates 14 parks and 2 open spaces, 14 playgrounds, 2 dog parks, 9 sports fields, 14 tennis courts, facility grounds, 8 parking plazas and medians through City staff and private contractors, totaling over 250 acres. Streets section The Streets Section ensures City s streets are clean and safe by properly maintaining sidewalks, pathways, bicycle bridges and parking lots. City staff and private contractors perform street sweeping, street light and traffic signal maintenance, street striping and storm drain cleaning. The Section is responsible for approximately 97 miles of streets, 4,000 traffic/street signs, graffiti abatement and public sidewalk hazard reduction. Trees section Management of the urban forest falls under the Tree Section, which promotes a pleasing natural environment with related social, economic and environmental benefits. The Section oversees the heritage tree ordinance, requiring permits for pruning and removing heritage trees on public and private property. In addition, the program maintains 20,000 public trees located in streets, parks and city facilities. CITY OF MENLO PARK BUDGET 91

116 Departmental Summaries Public Works TRANSPORTATION DIVISION The Transportation Division strives to efficiently move people and goods throughout Menlo Park by providing a transportation network through engineering, planning and education. The Division reduces traffic congestion by promoting ride-sharing, bicycling, walking and commute options such as bicycle education and safety programs, Bike to Work Day promotions and bicycle and pedestrian infrastructure improvement grants. The City s shuttle program offers local employers free connections between the Caltrain station and key destinations around the City. The Division, with assistance from contractors and consultants, maintains 40 traffic signals, over 2,200 streetlights and all signs and roadway markings throughout the City HIGHLIGHTS Received the Tree City USA Growth Award from the Arbor Day Foundation Completed the Nealon Park Booster Pump Project Completed the Water Main Replacement Completed the Nealon Park Field Improvement Project Formed a Transportation Master Plan Oversight and Outreach Committee Installed a Bus Shelter in Belle Haven Completed the Administration Building Emergency Generator Replacement Project Completed the Belle Haven Child Development Center Kitchen and Restroom Remodel Project Submitted a grant application for funding the construction of the Chrysler Stormwater Pump Station Received a grant for the Measure A Highway Funding Program for the Bayfront Expressway, Willow Road, and Marsh Road adaptive signal timing project Completed the 2017 Street Resurfacing Project Expanded the herbicide free park program to additional parks Set guidelines for establishing water use budgets for new developments in the office, life sciences and residential mixed-use zoning districts Awarded on-call construction contract for Asphalt and Concrete Repair Services Completed the police antenna replacement Completed the Water System Master Plan Adopted an updated cross-connection control ordinance Initiated Citywide Safe Routes to School BUDGET & INITIATIVES This year s budget includes requests to add three full-time equivalent positions, two funded through the water enterprise fund and one funded through development activity. An important change, and increase to the General Fund, was the shift of some projects from the capital improvement plan to the operating budget, such as in update to the Subdivision Ordinance. Another change to the department budget was a 10 percent increase to the tree portion of the landscape assessment and a 20 percent increase to the sidewalk portion of the landscape assessment. The increases will generate more revenue for tree trimming contract services and follow the five-year tree trimming cycle and reduce the backlog of sidewalk repairs throughout the City. INITIATIVES Improve the City s shuttle program, including modifying the Midday shuttle, adding transit stop amenities and exploring formation of a transportation management association Explore Dumbarton Rail Corridor activation and/or reuse Complete the corporation yard emergency well Complete the library landscaping project Complete the Sand Hill Reservoir #2 roof replacement Develop a recycled water program and ordinance Update the water emergency response plan Continue construction of bicycle and pedestrian facilities on Chilco Street Complete bicycle and pedestrian improvements on Haven Avenue Partner with Bohannon (Menlo Gateway) to complete Marsh Road/Bayfront Expressway improvements, Chrysler Drive/Constitution Drive Complete Chrysler Drive/Bayfront Expressway traffic signal improvements Complete the Chrysler Drive Pump Station replacement design and begin construction Complete current phase of Middle Avenue pedestrian and bicycle railroad crossing project Complete design of the Willow Oaks Dog Park renovation Complete construction of the Jack Lyle Park restroom Implement a Citywide Safe Routes to School program 92 CITY OF MENLO PARK BUDGET

117 Departmental Summaries Public Works CITY COUNCIL WORK PLAN ITEMS Transportation Master Plan Citywide Safe Routes to School Program Stanford University 2018 General Use Permit Review Downtown Streetscape Improvement Project (Specific Plan) Haven Avenue Streetscape Improvement Transportation Management Association High Speed Rail Coordination and Environmental Review Oak Grove, University, Crane Bicycle Improvement Project Willows Neighborhood Complete Streets El Camino Real Corridor Study Middlefield Rd/Ravenswood and Ringwood Avenues Traffic Signals Modification Willow/101 Interchange Chilco Streetscape and Sidewalk Installation Ravenswood Avenue/Caltrain Grade Separation Study Middle Avenue Caltrain Crossing Study City Buildings HVAC Modifications Burgess Pool Capital Improvements Gatehouse Fence Replacement Facilities Maintenance Master Plan Reservoir Reroof and Mixers Library Landscaping Water System Master Plan Chrysler Stormwater Pump Station Improvements San Francisquito Creek Upstream of U.S Highway 101 Flood Protection Project Emergency Water Supply Park Playground Equipment Jack Lyle Park Restroom Willow Oaks Park Improvements Bayfront Canal and Atherton Channel Flood Protection Downtown Utility Undergrounding Welcome Menlo Park Monument Signs Sea Level Rise Resiliency Plan Santa Cruz and Middle Avenues Resurfacing Oak Grove Safe Routes to School and Green Infrastructure Bayfront Expressway, Willow Road and Marsh Road Adaptive Signal Timing CITY OF MENLO PARK BUDGET 93

118 Departmental Summaries Public Works Est. PUBLIC WORKS WORKLOAD INDICATORS CIP Section Projects completed Projects in construction Projects in design phase Projects in planning/study phase Regional projects supporting Utilities Section Backflow assemblies tested Storm drain inspections Storm drains cleaned Water samples collected Maintenance Division Acres of park turf mowed Acres of school turf mowed Buildings maintained City vehicles & motorized equipment (mower, generator, etc) Facilities work orders completed Fleet work orders completed Graffiti removal work orders completed Heritage tree appeals received & processed Miles of streets swept Preventative maintenance inspections Smaller motorized equipment (saws, blowers etc) State-licensed pesticide applicators Street signs repaired Tree removal permits reviewed Trees trimmed CITY OF MENLO PARK BUDGET

119 Departmental Summaries Public Works Est. PUBLIC WORKS WORKLOAD INDICATORS West Bay Sanitary District vehicles maintained Engineering Division Grading and off-site plan checks completed for development projects Grading plan checks completed for single family homes Inspections completed Map reviews completed Off-site / ROW plan checks completed Planning applications received Transportation Division Public or school engagement events Shuttle ridership Signal call out (repairs) Street light call outs (repair) Streetlights maintained Traffic control plan reviews Truck route permits issued CITY OF MENLO PARK BUDGET 95

120 Departmental Summaries Public Works 96 CITY OF MENLO PARK BUDGET

121 Departmental Summaries Public Works Actuals Actuals Amended Budget* Est. Actual Proposed Budget* DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $5,272,211 $5,912,561 $6,657,279 $6,089,137 $7,053,189 Permanent part-time salaries 36,100 45, ,160 92, ,860 Temporary salaries 256, , , , ,000 Overtime 233, , , , ,000 Vacation cash-out 163,738 17,147 50, , ,000 SALARIES AND WAGES SUBTOTAL $5,962,370 $6,488,075 $7,468,118 $6,830,457 $7,837,048 CalPERS Pension 897,644 1,057,874 1,210,839 1,041,981 1,327,897 Insurances (health, dental, vision, life, medicare) 1,201,270 1,400,800 1,253,956 1,250,294 1,572,678 Workers Comp, OPEB allocations, other 466, , , , ,500 FRINGE BENEFITS SUBTOTAL $2,564,939 $2,910,999 $3,122,661 $2,950,141 $3,623,075 PERSONNEL SUBTOTAL $8,527,309 $9,399,075 $10,590,779 $9,780,598 $11,460,124 Operating Operating expense 1,444,854 1,715,089 2,692,469 2,632,617 3,074,709 Repairs and maintenance 570, , , , ,375 Services 4,411,252 5,226,716 9,200,025 5,842,332 4,453,535 Special projects expenditures 547,757 1,380, , , ,000 Travel 25,833 28,313 35,670 17,700 34,670 Utilities 5,243,225 6,186,599 6,230,114 7,285,620 7,450,648 OPERATING SUBTOTAL $12,243,101 $15,075,449 $19,301,613 $16,907,015 $16,184,936 Non-operating Capital (incl. carryover) 6,443,281 5,373,677 41,743,961* 7,463,925 51,373,300* Transfers 2,345,344 2,768, , , ,400 NON-OPERATING SUBTOTAL $8,788,626 $8,141,880 $41,970,039 $7,690,003 $51,822,700 TOTAL EXPENDITURES $29,559,035 $32,616,404 $71,862,431 $34,377,617 $79,467,760 FUNDING SOURCES, BY FUND General Fund $7,475,323 $8,688,242 $10,783,036 $10,364,535 $11,927,976 Special Revenue Funds 3,424,376 6,008,268 5,493,672 3,409,146 8,208,456 Capital Improvement Funds 10,387,252 10,174,713 36,808,721 9,454,880 35,072,015 Water Funds 8,085,529 7,456,556 17,654,177 10,171,455 23,398,313 Internal Service Funds 186, ,625 1,122, , ,000 TOTAL $29,559,035 $32,616,404 $71,862,431 $34,377,617 $79,467,760 *includes Capital Improvement Plan current year, carryover, and encumbered funds. CITY OF MENLO PARK BUDGET 97

122 Departmental Summaries Non-departmental OVERVIEW In addition to expenditures that are directly related to departmental operations, there are also significant expenditures that are not directly attributable to the departments or have already been factored in the department expenditures as an internal service fund transfer. Two of the most notable of the expenditures not attributable to operating departments are the General Fund s transfer to the Capital Improvement Plan Fund and the debt service on the recreation general obligation bonds. Before fiscal year , these expenditures were shown in the finance operations, which inflated the department s budget. It also made any sort of trend analysis difficult because expenditures for debt service and transfers can fluctuate significantly year-over-year. Starting in fiscal year , these expenditures were pulled out of the Administrative Service Department s budget and reflected in a separate section referred to as nondepartmental expenditures. Since the fiscal year, Internal Service Funds have been used for workers compensation, general liability, and retiree medical payments. Internal services are billed to user departments through an allocation formula and each department s expenditures includes charges equal to charges paid by these internal services. Also since fiscal year , nondepartmental fringe benefits include expenditures such as the vacancy factor (a credit to expenditures) and the management incentive program. Both of these fringe benefit items cannot be accurately assessed at the department level during budget preparation and are best budgeted at the non-departmental level. Inclusion of the vacancy factor as a credit to fringe benefits has created confusion when comparing budget to actual expense on the department level. Similarly, the management incentive program was previously budgeted in the Administrative Services Department and the amount was moved to non-departmental for fiscal year New to the non-departmental budget in fiscal year are Citywide postage costs and a contingency budget to account for the uncertainty related to ongoing service agreement negotiations. The City is currently at the end of several multi-year agreements for contracted services, and local economic prosperity in recent years has increased both the demand for services and their cost. As a result, the budget includes $615,000 to allow for completion of negotiations if needed. Agreements up for renewal which are expected to be more expensive than in previous years include janitorial services, street repairs, street sweeping, pool operations, and flood and storm drainage maintenance operations. It is important to note that as contingency funding, any increase in service cost which is not realized during negotiations will not increase actual expenditures. As reflected on the following page, fiscal year expenditures in the non-departmental category are budgeted at $11,497,576. Transfers to the Capital Improvement Plan Fund have the largest impact and are budgeted at $6,480,000 with an additional $361,500 being transferred to other funds as well. $1,436,650 has been budgeted for debt service related to the Recreation (Measure T) General Obligation Bonds. 98 CITY OF MENLO PARK BUDGET

123 Departmental Summaries Non-departmental Actuals Actuals Amended Budget Est. Actual Proposed Budget DEPARTMENTAL EXPENDITURES (ALL FUNDS) Personnel Regular salaries $0 $0 $259,694 $70,982 $358,832 Overtime - - 4, SALARIES AND WAGES SUBTOTAL $0 $0 $264,608 $70,982 $358,832 CalPERS Pension ,544 13,771 22,622 Insurances (health, dental, vision, life, medicare) - 465,428 11, , ,997 Workers Comp, OPEB allocations, other - - (2,029,375) 5,549 (1,294,600)* FRINGE BENEFITS SUBTOTAL $0 $465,428 ($2,002,685)* $775,472 ($529,981) PERSONNEL SUBTOTAL $0 $465,428 ($1,738,077) $846,454 ($171,149) Operating Operating expense - - 1,861,700 2,016,463 2,133,475 Services - 27, , , ,400 Special projects expenditures 478, , , ,000 OPERATING SUBTOTAL $478,191 $983,855 $2,111,057 $2,472,463 $3,339,875 Non-operating Debt service 4,980,874 2,914,245 1,430,023 1,208,400 1,436,650 Transfers 8,561,877 4,891,329 4,217,485 4,217,485 6,892,200 NON-OPERATING SUBTOTAL $13,542,750 $7,805,574 $5,647,508 $5,425,885 $8,328,850 TOTAL EXPENDITURES $14,020,941 $9,254,857 $6,020,489 $8,744,802 $11,497,576 SOURCES OF FUNDING, BY FUND General Fund $8,561,877 $5,135,953 $2,498,702 $4,232,031 $6,774,166 Special Revenue Funds - 47,216 64,932 52,738 59,253 Water Funds - 201, , ,064 8,553 Internal Service Funds - - 1,811,815 3,040,568 3,218,955 Debt Service Funds 5,459,064 3,870,627 1,430,023 1,208,400 1,436,650 TOTAL $14,020,941 $9,254,857 $6,020,489 $8,744,802 $11,497,576 *Payroll is budgeted at the department level assuming full staffing over the fiscal year. Consistent with the City Council adopted budget principles, the budget incorporates an assumption that a measurable amount of budgeted positions will go unfilled over the course of the fiscal year. The negative amount shown in the Non-departmental budget reflects the impact of this assumption without understating the personnel budgets of any one department. CITY OF MENLO PARK BUDGET 99

124

125 CAPITAL IMPROVEMENT PLAN FIVE-YEAR CAPITAL IMPROVEMENT PLAN NEW FUNDING REQUESTS 105 CIP PROJECT SUMMARY 107 CITY BUILDINGS & SYSTEMS 113 ENVIRONMENT 121 PARKS AND RECREATION 125 STORMWATER 133 STREETS AND SIDEWALKS 139 TRAFFIC AND TRANSPORTATION 147 WATER 157 FUNDING SOURCES 5-YEAR PROJECTION 163

126 Capital Improvement Plan INTRODUCTION This five-year Capital Improvement Plan (CIP) is the community s vision for short- and long-range development, maintenance, improvement and building of new infrastructure assets to benefit our residents, businesses, property owners and visitors. It provides a linkage between the General Plan, various master planning documents and budget, and provides a means for planning, scheduling and implementing capital and comprehensive planning projects over the next five years. The CIP provides a long-term approach for prioritizing and selecting new projects in the City. Although the plan document is updated annually, it allows the reader to review projects planned over the five-year timeframe and provides an overview of works in progress. The CIP is intended to incorporate the City s investments in infrastructure development and maintenance (i.e., capital improvements) with other significant capital expenditures that add to or strategically invest in the City s inventory of assets. Studies and capital expenditures of less than $75,000 are not typically included in the CIP. PROCEDURES FOR DEVELOPING THE FIVE-YEAR CAPITAL IMPROVEMENT PLAN Procedures for developing the five-year CIP utilize the City s forecasting, project evaluation and community engagement processes. These procedures are not intended to limit the ability to adjust programs, services and planned projects as unexpected needs, opportunities or impacts arise. Submitting & amending projects. Department managers initiate requests for new projects and modifications to or re-prioritize of existing projects. These requests, along with supporting information, are sent to the CIP committee in advance of the annual budget preparation. Requests include estimated costs, benefits, identified risks resulting from failure to complete the project/purchase, funding source(s), availability of funds, estimated time frame and any anticipated impacts to previously approved projects. Evaluating & Ranking. The CIP Committee performs the initial evaluation and ranking of proposed projects. Committee membership includes the City Manager or his/her designee; directors of Community Development, Community Services, Administrative Services and Public Works departments; the Maintenance, Engineering, and Transportation Division Managers and any other staff, as designated by the City Manager. The Committee meets as needed, but not less than once each calendar year. CARRYOVER APPROPRIATIONS The project descriptions include a column of projected carryover appropriations for those projects where prior City Council appropriations are estimated to carryover to the new fiscal year. This amount is strictly an estimate and will be trued-up at year-end close. Amounts reflected in the projected carryover column should not be construed as funds available for commitment. In many cases the carryover estimate includes funds that have been encumbered/committed as a result of an executed contract for services or goods. 102 CITY OF MENLO PARK BUDGET

127 Capital Improvement Plan PRIORITIZATION CRITERIA Projects are prioritized in accordance with evaluation criteria including: Capacity to deliver/impacts to other projects Public health and safety/risk exposure Protection of infrastructure Economic development Impacts on operating budgets External requirements Population served Community/commission support Relationship to adopted plans Cost/benefit Availability of financing COMMUNITY INPUT Once the City Council s priorities are defined through their work plan and department managers have submitted and prioritized projects according to the above criteria, an opportunity for feedback is provided to the City s various commissions before the City Council s incorporation into the annual budget. PROPOSED PROJECTS This five-year CIP includes nine new projects recommended for implementation commencing in fiscal year and 33 additional projects recommended for funding in future fiscal years. Projects that do not rank high enough to be included in this five-year plan become part of the future projects list. The list also includes projects where grant funding is not yet awarded. Several projects in this five year CIP address ongoing infrastructure or facility maintenance needs and are included on an annual, bi-annual or periodic basis. Examples include street resurfacing and the sidewalk repair program. New capital projects and projects involving infrastructure maintenance are identified. Projects approved in prior fiscal years that have not yet been completed are listed as well as several As several Master Plans are underway in the City, including for Parks & Recreation, Transportation and Stormwater programs, the future projects lists will be updated and replaced in next year s budget. The table below lists total funding levels for project categories with corresponding percentages of the total funding. PROJECT FUNDING SOURCES The five-year CIP coordinates physical improvements with financial planning, allowing maximum benefits from available funding sources. It relies on funding from various sources, largely retained in the capital and special revenue funds, with uses that are usually restricted for specific purposes. Although an annual transfer from the General Fund to the City s General CIP Fund (approximately $3.9 million) is part of the City s operating budget, this funding is intended solely for maintaining existing infrastructure in its current condition. The restricted funding sources shown in the table on the following page comprise the City s major project funding sources. PROJECT CATEGORY FUNDING PERCENT OF TOTAL CIP City Buildings & Systems $1,885,000 10% Environment 450,000 2% Parks & Recreation 1,295,000 7% Stormwater 450,000 2% Streets & Sidewalks 6,015,000 31% Traffic & Transportation 3,567,000 18% Water 5,850,000 30% GRAND TOTAL $19,512, % CITY OF MENLO PARK BUDGET 103

128 Capital Improvement Plan GENERAL PLAN CONSISTENCY The projects listed in the five-year CIP are presented to the Planning Commission during a Public Hearing before City Council adoption of the plan. The Planning Commission must review the CIP in order to adopt a finding that it is consistent with the City s General Plan. ENVIRONMENTAL REVIEW The development of the five-year plan is not a project, as defined in the California Environmental Quality Act (CEQA), and an environmental review is not required. Individual projects listed herein may be subject to CEQA and environmental reviews will be conducted at the appropriate time during implementation of those projects. 104 CITY OF MENLO PARK BUDGET

129 Capital Improvement Plan New Funding Requests New Funding Request New Funding Request CITY BUILDINGS & SYSTEMS Belle Haven Youth Center Improvements $200,000 City Buildings (Minor) 500,000 City Buildings HVAC Modifications 420,000 Fire Plans and Equipment Replacement for City Buildings 115,000 Furniture Replacement 400,000 Library System Improvement: Belle Haven Branch Library 100,000 Library System Improvement: Main Library 150,000 SUBTOTAL $1,885,000 STREETS & SIDEWALKS Downtown Parking Utility Underground $200,000 Sharon Road Sidewalk Installation 935,000 Sidewalk Repair Program 500,000 Street Resurfacing Project 4,200,000 Welcome to Menlo Park Monument Signs 180,000 SUBTOTAL $6,015,000 TRAFFIC & TRANSPORTATION Middle Avenue Caltrain Crossing Study Design and Construction $1,100,000 ENVIRONMENT Climate Action Plan $100,000 Electric Vehicle Chargers at City Facilities 200,000 Middlefield Road at Linfield Drive and Santa Monica Avenue Crossing Improvements Pierce Road Sidewalk and San Mateo Drive Bike Route Installation 960,000 1,007,000 Sea Level Rise Resiliency Plan 150,000 SUBTOTAL $450,000 PARKS & RECREATION Aquatic Center Maintenance (annual) $400,000 Park Improvements (Minor) 200,000 Park Pathways Repairs 200,000 Tennis Court Maintenance 120,000 Willow Oaks Park Improvements 375,000 SUBTOTAL $1,295,000 Transportation Projects (Minor) 150,000 Traffic Signal Modifications 350,000 SUBTOTAL $3,567,000 WATER Automated Water Meter Reading $600,000 Emergency Water Storage / Supply 2,000,000 Reservoir No. 2 Roof Replacement 2,650,000 Water Main Replacement Project 600,000 SUBTOTAL $5,850,000 STORMWATER Green Infrastructure Plan $100,000 GRAND TOTAL $19,512,000 Stormwater Master Plan 350,000 SUBTOTAL $450,000 CITY OF MENLO PARK BUDGET 105

130 Capital Improvement Plan 106 CITY OF MENLO PARK BUDGET

131 Capital Improvement Plan CIP Project Summary Funding Source Projected Carryover NEW REQUEST Future Funding Needs (unfunded) CITY BUILDINGS & SYSTEMS Belle Haven Youth Center Improvements Burgess Pool Lobby Renovation General Capital - $200, General Capital , City Buildings (Minor) General Capital 644, , , , , ,000 City Buildings HVAC Modifications Corporation Yard Master Plan General Capital 125, , General Capital ,000 - Cost of Service/Fee Study General Capital 54, ,000 - Facilities Maintenance Master Plan Fire Plans and Equipment Replacement for City Buildings General Capital 150, General Capital 61, , Furniture Replacement General Capital - 400, Gate House Fence Replacement Information Technology Master Plan and Implementation General Capital 120, General Capital 2,940,809-1,250,000 1,250,000 1,250,000 1,250,000 Library System Improvement: Belle Haven Branch Library Library System Improvement: Main Library Library System Improvements Library System Improvements 37, , , , Onetta Harris Community Center Gymnasium Floor Replacement Onetta Harris Community Center Multipurpose Room Renovation General Capital , General Capital , SUBTOTAL All Funds $4,280,360 $1,885,000 $2,200,000 $1,875,000 $1,950,000 $1,750,000 CITY OF MENLO PARK BUDGET 107

132 Capital Improvement Plan Funding Source Projected Carryover NEW REQUEST Future Funding Needs (unfunded) ENVIRONMENT Climate Action Plan General Capital $203,057 $100,000 $100,000 $100,000 $100,000 $100,000 Electric Vehicle Chargers at City Facilities Heritage Tree Ordinance Program Evaluation General Capital - 200, , General Capital 70, Sea Level Rise Resiliency Plan General Capital - 150, Trash and Recycling Strategic Plan Garbage Service 59, SUBTOTAL All Funds $332,821 $450,000 $500,000 $100,000 $100,000 $100,000 PARKS & RECREATION Aquatic Center Maintenance (annual) General Capital $99,068 $400,000 $400,000 $400,000 $400,000 $400,000 Bedwell Bayfront Park Collection and Leachate Systems Repair Bayfront Landfill 726, Bedwell Bayfront Park Master Plan Implementation General Capital - - 4,000, Belle Haven Pool Master Plan Implementation Civic Center Campus Improvements Recreation In-Lieu Recreation In-Lieu , , , ,000 - General Capital 100, , , ,000 - Jack Lyle Park Restroom Recreation In-Lieu 450, General Capital 139, Library Landscaping General Capital 436, Park Improvements (Minor) General Capital 143, , , , , ,000 Park Pathways Repairs General Capital - 200, , , , ,000 Park Playground Equipment General Capital 450, , , Parks and Recreation Master Plan Update General Capital 191, Sport Field Renovations General Capital , , , ,000 Tennis Court Maintenance General Capital 120, , , , , ,000 Willow Oaks Park Improvements Recreation In-Lieu 536, , SUBTOTAL All Funds $3,393,263 $1,295,000 $6,890,000 $2,570,000 $2,020,000 $1,520, CITY OF MENLO PARK BUDGET

133 Capital Improvement Plan Funding Source Projected Carryover NEW REQUEST Future Funding Needs (unfunded) STORMWATER Bayfront Canal and Atherton Channel Flood Protection General Capital $442, Chrysler Pump Station Improvements Highway Users Tax 200, General Capital 5,844, Green Infrastructure Plan Storm Drainage 80, General Capital 100, , San Francisquito Creek Flood Reduction and Restoration San Francisquito Creek Upstream of 101 Flood Protection General Capital 500, General Capital 120, Stormwater Master Plan General Capital - 350, Willow Place Bridge Abutment Repairs General Capital , SUBTOTAL All Funds $7,288,342 $450,000 $250, CITY OF MENLO PARK BUDGET 109

134 Capital Improvement Plan Funding Source Projected Carryover NEW REQUEST Future Funding Needs (unfunded) STREETS & SIDEWALKS Chilco Street and Sidewalk Installation Downtown Parking Structure Study General Capital $43, General Capital 220, Downtown Parking Utility Underground Downtown Parking Permits - 200, ,000-5,000,000 - Downtown Streetscape Improvement Oak Grove Safe Routes to School and Green Infrastructure General Capital 303, , Measure A 615, Parking Plaza 7 Renovations Parking Plaza 8 Renovations Santa Cruz and Middle Avenues Resurfacing Downtown Parking Permits Downtown Parking Permits Construction Impact Fee ,000 2,000, ,000-2,000, ,300, Sharon Road Sidewalk Installation General Capital - 935, Sidewalk Repair Program Sidewalk Assessment 2, , , , , ,000 General Capital 5, , , , , ,000 Street Resurfacing Project General Capital 300, Highway Users Tax 1,068,877 2,000, ,000 2,000, ,000 2,000,000 Construction Impact Fee SB1 LSRP Capital 1,615,697 1,700,000-4,000,000-4,000, , , , , ,000 Welcome to Menlo Park Monument Signs Willow Oaks Park Bicycle Connector General Capital - 180, , General Capital , SUBTOTAL All Funds $4,174,886 $6,015,000 $5,800,000 $9,000,000 $8,600,000 $7,000, CITY OF MENLO PARK BUDGET

135 Capital Improvement Plan Funding Source Projected Carryover NEW REQUEST Future Funding Needs (unfunded) TRAFFIC & TRANSPORTATION Bayfront Expressway, Willow Road and Marsh Road Adaptive Signal Dumbarton Rail Corridor Planning Support Measure A $275, Transportation 20, El Camino Real Crossings Improvements Haven Avenue Streetscape Improvement Middle Avenue Caltrain Crossing Study Design and Construction Transportation Impact Fees Transportation Impact Fees Transportation Impact Fees 324, , ,725 1,100,000-9,900, Middlefield Road at Linfield Drive and Santa Monica Avenue Crossing Improvements Oak Grove, University, Crane Bicycle Improvement Project General Capital - 960, General Capital 66, Pierce Road Sidewalk and San Mateo Drive Bike Route Installation Ravenswood Avenue/ Caltrain Grade Separation Traffic Signal Modifications Transit Improvements Transportation Impact Fees Transportation Impact Fees Transportation Impact Fees Transportation Impact Fees - 1,007, , ,000, , , , , , ,000 85, Transportation Master Plan General Capital 54, Transportation Projects (Minor) Transportation Impact Fees 75, Measure A - 75,000 75,000 75,000 75,000 75,000 General Capital - 75,000 75,000 75,000 75,000 75,000 Willow Road Transportation Study Transportation Impact Fees 159, Willow/101 Interchange General Capital 113, Willows Neighborhood Complete streets General Capital 300, SUBTOTAL All Funds $2,937,151 $3,567,000 $500,000 $35,400,000 $500,000 $500,000 CITY OF MENLO PARK BUDGET 111

136 Capital Improvement Plan Funding Source Projected Carryover NEW REQUEST Future Funding Needs (unfunded) WATER Automated Water Meter Reading Emergency Water Storage / Supply Fire Flow Capacity Improvements Reservoir No. 2 Roof Replacement Water Capital $500,000 $600,000 $1,800,000 $1,200,000 $400,000 - Water Capital 4,209,541 2,000,000 2,800,000 2,800, Water Capital - - 1,000,000 1,000,000 1,000,000 1,500,000 Water Capital 1,490,686 2,650, Reservoirs #1 & #2 Mixers Water Capital 114, Urban Water Management Plan Water Main Replacement Project Water Capital , Water Capital 1,241, ,000 2,050,000 3,600,000 1,800,000 1,800,000 SUBTOTAL All Funds $7,556,678 $5,850,000 $7,790,000 $8,600,000 $3,200,000 $3,300,000 GRAND TOTAL $29,963,501 $19,512,000 $23,930,000 $57,545,000 $16,370,000 $14,170, CITY OF MENLO PARK BUDGET

137 Capital Improvement Plan City Buildings & Systems CITY BUILDINGS & SYSTEMS The City s aging facilities require both regular maintenance and more substantive system replacements. Projects included under the City Buildings and Systems CIP category focus on improvements to existing Cityowned facilities and the construction of new buildings. These improvements allow the City to continue to maintain and enhance services to the community. This category also includes funding for upgrades to the City s systems such as information technology. This category of the CIP is least likely to be eligible for outside funding, with the exception of donations, and therefore is fully funded by transfers from the General Fund. Projected Carryover NEW REQUEST Future Funding Nees (unfunded) CITY BUILDINGS & SYSTEMS Belle Haven Youth Center Improvements - $200, Burgess Pool Lobby Renovation , City Buildings (Minor) 644, , , , , ,000 City Buildings HVAC Modifications 125, , Corporation Yard Master Plan ,000 - Cost of Service/Fee Study 54, ,000 - Facilities Maintenance Master Plan 150, Fire Plans and Equipment Replacement for City Buildings 61, , Furniture Replacement - 400, Gate House Fence Replacement 120, Information Technology Master Plan and Implementation 2,940,809-1,250,000 1,250,000 1,250,000 1,250,000 Library System Improvement: Belle Haven Branch Library 37, , Library System Improvement: Main Library 147, , Onetta Harris Community Center Gymnasium Floor Replacement Onetta Harris Community Center Multipurpose Room Renovation Onetta Harris Community Center Multipurpose Room Renovation , , ,000 Subtotal $4,280,360 $1,885,000 $2,200,000 $1,875,000 $1,950,000 $1,750,000 CITY OF MENLO PARK BUDGET 113

138 Capital Improvement Plan City Buildings & Systems BELLE HAVEN YOUTH CENTER IMPROVEMENTS This project involves assessing potential building improvements to house the Belle Haven Youth Center program. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 200,000 - $200,000 BURGESS POOL LOBBY RENOVATION This project is designed to address multiple concerns with the lobby of the Burgess Pool building, such as the inadequate space of the transaction area and the high noise levels. The project would involve the relocation of the entrance to the lobby, redesign of the counter space, additional seating and the installation of acoustical treatments. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund ,000 $125, CITY OF MENLO PARK BUDGET

139 Capital Improvement Plan City Buildings & Systems CITY BUILDINGS (MINOR) This ongoing project consists of the implementation of improvements that extend the useful life of systems and equipment in all City buildings. This project does not provide for the replacement or significant renovation of City facilities. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 644, ,000 2,000,000 $2,500,000 CITY BUILDINGS HVAC MODIFICATIONS This project modifies the heating, ventilation and air conditioning (HVAC) systems in the Arrillaga Family Recreation Center and the Police Department to address system deficiencies. At the Recreation Center, the project will evaluate and implement options for addressing temperature fluctuations and equipment failure. At the Police Department, the project focuses on improving the design of the HVAC system that serves the dispatch area. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 125, ,000 - $420,000 CITY OF MENLO PARK BUDGET 115

140 Capital Improvement Plan City Buildings & Systems CORPORATION YARD MASTER PLAN The project will evaluate the functions and services provided at the Corporation Yard, which was built in the 1970s, and recommend the implementation of best management practices to improve office workflow, use of space, parking, material storage and the fuel facility. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund ,000 $100,000 FACILITIES MAINTENANCE MASTER PLAN This project will survey City owned facilities, assess their maintenance needs and develop a program focused on the implementation of proactive and preventive maintenance practices intended to preserve and retain the value of the facilities. The project will ensure that buildings are properly maintained to avoid premature failures that are not cost effective in the long-term. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 150, CITY OF MENLO PARK BUDGET

141 Capital Improvement Plan City Buildings & Systems FIRE PLANS AND EQUIPMENT REPLACEMENT FOR CITY BUILDINGS The project consists of the replacement of fire panels, alarms, strobe lights and associated equipment in the Council Chambers, Library and Onetta Harris Community Center. The existing systems are outdated and starting to trigger false alarms. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 61, ,000 - $115,000 FURNITURE REPLACEMENT The project replaces furniture that is over 20 years old which requires regular repair and cleaning due to heavy use. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 400,000 - $400,000 CITY OF MENLO PARK BUDGET 117

142 Capital Improvement Plan City Buildings & Systems GATEHOUSE FENCE REPLACEMENT The project consists of the replacement of portions of the existing Gatehouse fence along Ravenswood Avenue that have deteriorated or been damaged. The replacement fencing will be designed to match the intricate details of the existing unit. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 120, INFORMATION TECHNOLOGY MASTER PLAN AND IMPLEMENTATION This project includes updated technology for various critical and enhanced services including the financial system, web services, graphical information services and other systems within the City. The first phase includes an assessment of the existing technology tools in use within the organization, evaluates the need for replacement, and develops recommendations on the best replacements in priority order. Working with a consultant and a representative City Committee to enable a knowledgeable evaluation and avoid disruption caused by failures to the aging systems, the second phase includes implementation of the approved master plan. Additional funding may be necessary once the master plan is completed. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 2,940,809-5,000,000 $5,000, CITY OF MENLO PARK BUDGET

143 Capital Improvement Plan City Buildings & Systems LIBRARY SYSTEM IMPROVEMENTS BELLE HAVEN BRANCH LIBRARY This projects consists of improvements to the Branch Library located in the Belle Haven neighborhood. The current phase of the project consists of a neighborhood library needs assessment. In addition, existing City-owned buildings in the Belle Haven Neighborhood were evaluated to determine the potential to accommodate a relocated library use from the current location at Belle Haven School. Upon completion of the Neighborhood Library Needs Assessment, the next phase would be the preparation of a Space Needs Study similar to the one recently conducted for the Main Library. Future phases would involve site selection and conceptual designs. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Library System Improvements Fund 37, ,000 - $100,000 LIBRARY SYSTEM IMPROVEMENTS MAIN LIBRARY This project consists of improvements to the Main Library located on the Burgess Campus. The Space Needs Study for the Main Library was completed in The current phase of this project is identifying a location for a new building. The next step would be the preparation of a conceptual design, which would typically consists of a site plan, conceptual floor plans with furniture layouts, building sections, exterior elevations and renderings of the interior and exterior of the building. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Library System Improvements Fund 147, ,000 - $150,000 CITY OF MENLO PARK BUDGET 119

144 Capital Improvement Plan City Buildings & Systems ONETTA HARRIS COMMUNITY CENTER GYMNASIUM FLOOR REPLACEMENT The project replaces the gymnasium flooring to eliminate dead spots as well as the bleachers and side baskets. The bleachers would be replaced with new motorized versions that are more efficient and safer to use than the existing models. The improvements are necessary as the use of the gymnasium has increased significantly in recent years and there is a need to improve the facility to suit the needs of a wide variety of court users. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund ,000 $300,000 ONETTA HARRIS COMMUNITY CENTER MULTIPURPOSE ROOM RENOVATION The project replaces the multipurpose room kitchen counter tops, cabinet and sinks as well as renovates the existing restroom to better meet the needs of facility users. Community Center usage has increased over the past few years and includes higher weekend rentals and weekday class participation. A renovated kitchen will lead to increased usage and the opportunity to offer cooking-related classes. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund ,000 $150, CITY OF MENLO PARK BUDGET

145 Capital Improvement Plan Environment ENVIRONMENT The Environment CIP provides for a variety of projects and programs to further the City s environmental sustainability initiatives, including those in the City Council adopted Climate Action Plan. This category of the CIP is primarily supported by the General Fund. However, initiatives pertaining to solid waste are funded through refuse rates. ENVIRONMENT Projected Carryover NEW REQUEST Future Funding Nees (unfunded) Climate Action Plan $203,057 $100,000 $100,000 $100,000 $100,000 $100,000 Electric Vehicle Chargers at City Facilities - 200, , Heritage Tree Ordinance Program Evaluation 70, Sea Level Rise Resiliency Plan - 150, Trash and Recycling Strategic Plan 59, Subtotal $332,821 $450,000 $500,000 $100,000 $100,000 $100,000 CITY OF MENLO PARK BUDGET 121

146 Capital Improvement Plan Environment CLIMATE ACTION PLAN The City first adopted a Climate Action Plan in 2009, and in 2013, the City set a greenhouse gas reduction target of 27 percent from 2005 levels by Annually, the City completes a greenhouse gas inventory and adopts a five-year climate action plan strategy to assess progress toward the GHG reduction target. The purpose of this project is to provide an annual funding source to continue implementation of the CAP programs and strategies. This year funding will be utilized for EV chargers preliminary work. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 203, , ,000 $500,000 ELECTRIC VEHICLE CHARGERS AT CITY FACILITIES This project installs the necessary infrastructure to support six dual cord, Level 2 electric vehicle chargers in the Council Parking Lot and one electric vehicle charger at the Corporation Yard to support alternative fuel vehicles for the City fleet. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 200, ,000 $600, CITY OF MENLO PARK BUDGET

147 Capital Improvement Plan Environment HERITAGE TREE ORDINANCE PROGRAM EVALUATION In the summer of 2012, the Environmental Quality Commission (EQC) provided recommendations to staff and City Council regarding updating and modifying the City s Heritage Tree Ordinance. This study reviews the EQC s recommendation, analyzes program s effectiveness and processes, and prepares revisions for the City Council to consider for adoption. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 70, SEA LEVEL RISE RESILIENCY PLAN The Sea Level Rise Resiliency Plan develops the framework to help prepare the community for potential adverse impacts related to rising seas associated with climate change. The Plan will use the findings from San Mateo County s Sea Level Rise Vulnerability Assessment and assess existing hazards and future risks to develop a vulnerability assessment of the City s existing infrastructure. Adaptation strategies will be developed and will incorporate regional efforts, such as the SAFER Bay project. The findings will be integrated with the City s Local Hazard Mitigation Plan, capital improvement projects and other documents. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 150,000 - $150,000 CITY OF MENLO PARK BUDGET 123

148 Capital Improvement Plan Environment TRASH AND RECYCLING STRATEGIC PLAN This project is one of various trash reduction measures required by the Municipal Regional Stormwater Permit to reduce litter in the City and reduce the amount of trash entering the storm drain system by 100% by The project consists of the implementation of an improved public area trash and recycling container management program that focuses on bin replacement, better labeling of containers, increased service/ maintenance and the installation of trash capture devices in the storm drain system. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Solid Waste Service Fund 59, CITY OF MENLO PARK BUDGET

149 Capital Improvement Plan Parks & Recreation PARKS & RECREATION The Parks & Recreation CIP provides for a variety of projects and programs to meet the recreational needs of the community. In fiscal year , the City anticipates conclusion of a comprehensive Parks & Recreation Master Plan. Based on public input, the Plan will recommend improvements and initiatives to the City s parks and recreation facilities to continue to meet the needs of the community and program users. This category of the CIP is primarily supported by the General Fund. However, voter approved Measure T General Obligation authority permits the City to issue a third tranche of debt to help finance the Parks & Recreation Master Plan initiatives. In addition, certain capital projects may qualify to use Recreation In-Lieu impact fees imposed on new development. Finally, due to the relationship of the Bedwell Bayfront Park and the former landfill, certain projects may have access to funds collected through refuse rates to maintain the landfill. Projected Carryover NEW REQUEST Future Funding Nees (unfunded) PARKS & RECREATION Aquatic Center Maintenance (annual) $99,068 $400,000 $400,000 $400,000 $400,000 $400,000 Bedwell Bayfront Park Collection and Leachate Systems Repair 726, Bedwell Bayfront Park Master Plan Implementation - - 4,000, Belle Haven Pool Master Plan Implementation , Civic Center Campus Improvements 100, , , ,000 - Jack Lyle Park Restroom Library Landscaping 436, Park Improvements (Minor) 143, , , , , ,000 Park Pathways Repairs - 200, , , , ,000 Park Playground Equipment 450, , , Parks and Recreation Master Plan Update 191, Sport Field Renovations , , , ,000 Tennis Court Maintenance 120, , , , , ,000 Willow Oaks Park Improvements 536, , Subtotal $3,393,263 $1,295,000 $6,890,000 $2,570,000 $2,020,000 $1,520,000 CITY OF MENLO PARK BUDGET 125

150 Capital Improvement Plan Parks & Recreation AQUATIC CENTER MAINTENANCE (ANNUAL) This ongoing project consists of the implementation of minor improvements under $100,000 intended to extend the useful life of systems, infrastructure and equipment at the Burgess and Belle Haven pools. This program does not provide for the replacement or significant renovation of the City s pools. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 99, ,000 1,600,000 $2,000,000 BEDWELL BAYFRONT PARK COLLECTION AND LEACHATE SYSTEMS REPAIR This project improves existing gas collection and leachate systems serving the former landfill at Bedwell Bayfront Park and includes several phases. Replacing gas extraction wells and installing a new leachate pumping system to comply with best management practices are included to increase methane capture and reduce greenhouse gas emissions. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Bayfront Landfill Fund 726, CITY OF MENLO PARK BUDGET

151 Capital Improvement Plan Parks & Recreation BEDWELL BAYFRONT PARK MASTER PLAN IMPLEMENTATION This project consists of the implementation of capital improvements recommended in the 2017 Bedwell Bayfront Park Master Plan. The improvements are necessary to improve services to the high number of park users and to address aging infrastructure and incorporate sea level rise protection. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - - 4,000,000 $4,000,000 BELLE HAVEN POOL MASTER PLAN IMPLEMENTATION This project consists of the implementation of improvements recommended in the 2017 Belle Haven Pool Analysis and Audit. Improvements are necessary to address the increased demand in services. Once a seasonal facility, the Belle Haven Pool now operates seven days a week. Services include youth after school programming, youth swim team, youth water polo program, swim school for youth and adults serving people daily depending on the season. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Recreation In-Lieu Fund ,000 $370,000 CITY OF MENLO PARK BUDGET 127

152 Capital Improvement Plan Parks & Recreation CIVIC CENTER CAMPUS IMPROVEMENTS This project involves includes the design and construction of improvements to the Civic Center Campus such as additional outdoor seating, parking lot modifications, Ravenswood bike lane extension and sidewalk modification, gatehouse landscaping, minor landscaping and irrigation in the Library parking lot. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 100, ,000 $900,000 Recreation In-Lieu Fund ,000 $600,000 Subtotal 100,000-1,500,000 $1,500,000 JACK LYLE PARK RESTROOM This project involves the design and construction of a restroom facility at Jack Lyle Park to address community needs associated with park users. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Recreation In-Lieu Fund 450, General Capital Fund 139, Subtotal 589, CITY OF MENLO PARK BUDGET

153 Capital Improvement Plan Parks & Recreation LIBRARY LANDSCAPING The project replaces the landscaping and irrigation systems around the library, which are in need of major upgrades. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 436, PARK IMPROVEMENTS (MINOR) This ongoing project consists of the implementation of minor improvements under $100,000 intended to extend the useful life of systems, infrastructure and equipment in the City s parks. This program does not provide for the replacement or significant renovation of the City s park facilities. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 143, , ,000 $1,000,000 CITY OF MENLO PARK BUDGET 129

154 Capital Improvement Plan Parks & Recreation PARK PATHWAYS REPAIRS The project replaces damaged pathways at Sharon, Nealon, and Stanford Hills Parks. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 200,000 2,000,000 $2,200,000 PARK PLAYGROUND EQUIPMENT This project addresses playground improvements prioritized in a 2015 comprehensive Playground Safety Inspection Report, beginning with Nealon Park, Burgess Park and Willow Oaks Park. In addition to meeting updated California Safety Standards, the new playgrounds may incorporate theme-based educational and interactive components. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 450,000-1,050,000 $1,050, CITY OF MENLO PARK BUDGET

155 Capital Improvement Plan Parks & Recreation PARKS AND RECREATION MASTER PLAN UPDATE This project updates the 1999 Parks and Recreation Master Plan and involves community engagement activities to seek input on park and recreational uses and demands. The master plan will result in the development of recommended capital and operating improvements and will establish priorities for a potential third phase of Measure T bond funds. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 191, SPORT FIELD RENOVATIONS The project includes turf replacement, drain cleaning and field leveling of the sport fields managed by the City. The fields at Burgess Park, La Entrada School and Jack Lyle Park will be renovated first to ensure continued life expectancy. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - - 1,200,000 $1,200,000 CITY OF MENLO PARK BUDGET 131

156 Capital Improvement Plan Parks & Recreation TENNIS COURT MAINTENANCE This program is ongoing and focuses on the implementation of adequate maintenance practices to extend the useful life of the City s fifteen tennis courts. The program follows a maintenance schedule that includes the full reconstruction of every court every twelve years. Interim maintenance work includes crack repair and court resurfacing. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 120, , ,000 $600,000 WILLOW OAKS PARK IMPROVEMENTS This project involves the design and construction of a restroom facility at Willow Oaks Park and improvements to the Dog Park to address community needs associated with park users. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Recreation In-Lieu Fund 536, ,000 - $375, CITY OF MENLO PARK BUDGET

157 Capital Improvement Plan Stormwater STORMWATER The Stormwater CIP consists of projects and programs required to address the impacts of flooding in the watershed and stormwater water quality. These projects involve improvements that address localized drainage issues and larger interagency efforts to address flooding concerns associated with San Francisquito Creek, the Bayfront Canal and the Atherton Channel. In addition, projects in this category may be required to meet National Pollution Elimination Discharge System (NPDES), an unfunded mandate to minimize debris and pollutants discharged to San Francisco Bay. This category of the CIP is solely supported by the General Fund and future demand for funds is unknown. Other possible funding strategies for these projects include grants, as well as the development of benefit assessment districts that can pay for improvements in specific sections of the City where more investment needs have been identified. Projected Carryover NEW REQUEST Future Funding Nees (unfunded) STORMWATER Bayfront Canal and Atherton Channel Flood Protection $442, Chrysler Pump Station Improvements 6,044, Green Infrastructure Plan 180, , San Francisquito Creek Flood Reduction and Restoration San Francisquito Creek Upstream of 101 Flood Protection 500, , Stormwater Master Plan - 350, Willow Place Bridge Abutment Repairs , Subtotal $7,288,342 $450,000 $250, CITY OF MENLO PARK BUDGET 133

158 Capital Improvement Plan Stormwater BAYFRONT CANAL AND ATHERTON CHANNEL FLOOD PROTECTION The project involves the design of an underground structure to route stormflows from the Bayfront Canal and Atherton Channel to the Ravenswood Complex Ponds S5 & R5, which are part of the South Bay Salt Pond Restoration Project. The ponds would be used for stormwater detention and would mitigate flooding in the cities of Menlo Park and Redwood City and San Mateo County. The project is being developed through a collaborative effort between the City, Redwood City, San Mateo County and the Town of Atherton. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 442, CHRYSLER PUMP STATION IMPROVEMENTS This project involves the design and construction of a new Chrysler Stormwater Pump Station. The existing facility was originally built in 1958 has reached the end of its useful life. The improved facility will provide flood protection to sections of the Bayfront area, which include the Menlo Gateway buildings and a part of the Facebook West Campus site. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Highway Users Tax Fund 200, General Capital Fund 5,844, Subtotal 6,044, CITY OF MENLO PARK BUDGET

159 Capital Improvement Plan Stormwater GREEN INFRASTRUCTURE PLAN As part of the current Municipal Regional Stormwater Permit, the City is required to develop a Green Infrastructure (GI) Plan that identifies areas throughout the watershed where storm runoff can be treated to improve water quality. The study will require an evaluation of the land uses in the watershed and a recommendation of GI infrastructure required to reduce the levels of mercury and polychlorinated biphenyls (PCBs) entering San Francisco bay. The plan is to be finalized and submitted to the State for approval in FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Storm Drainage Fund 80, General Capital Fund 100, ,000 - $100,000 Subtotal 180, ,000 - $100,000 SAN FRANCISQUITO CREEK FLOOD REDUCTION AND RESTORATION The San Francisquito Creek Joint Powers Authority is in the process of designing and constructing a project intended to protect communities in the City and the cities of Palo Alto and East Palo Alto from an event similar to the flood of The first of two projects, construction of improvements to the section of the creek located downstream of U.S. Highway 101 are underway. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 500, CITY OF MENLO PARK BUDGET 135

160 Capital Improvement Plan Stormwater SAN FRANCISQUITO CREEK UPSTREAM OF 101 FLOOD PROTECTION The second of two projects, the effort being led by the San Francisquito Creek Joint Powers Authority focuses on improvements to creek sections located upstream of U.S. Highway 101 to protect communities in the City and the cities of Palo Alto and East Palo Alto from an event similar to the flood of The project proposes to widen the creek in a number of sections and the replacement of the Pope Chaucer Bridge. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 120, STORMWATER MASTER PLAN The Stormwater Master Plan evaluates the condition of the City s Stormwater system and identifies the capital improvements necessary to address surface water collection, operations, maintenance, treatment and storage requirements. The plan includes a hydraulic evaluation of the City s storm drain network, infrastructure assessment, identifies water quality requirements, recommends planning level costs for the improvements and integrates the City s Green Infrastructure policies. The planning period for the master plan will be 25 years. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 350,000 - $350, CITY OF MENLO PARK BUDGET

161 Capital Improvement Plan Stormwater WILLOW PLACE BRIDGE ABUTMENT REPAIRS This project repairs damage to the bridge abutment from the December 2012 storm event. Preliminary study of repairs was completed with design and construction as next steps. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund ,000 $250,000 CITY OF MENLO PARK BUDGET 137

162 Capital Improvement Plan 138 CITY OF MENLO PARK BUDGET

163 Capital Improvement Plan Streets & Sidewalks STREETS & SIDEWALKS The Streets and Sidewalks CIP projects maintain and improve the City s roadways, City-owned parking plazas, and sidewalks. This category of the CIP is supported by a variety of sources including funds from the State of California, impact fees, parking permit sales, special gas tax levies, and countywide sales tax levies. Projected Carryover NEW REQUEST Future Funding Nees (unfunded) STREETS AND SIDEWALKS Chilco Street and Sidewalk Installation $43, Downtown Parking Structure Study 220, Downtown Parking Utility Underground - 200, ,000-5,000,000 - Downtown Streetscape Improvement 303, , Oak Grove Safe Routes to School and Green Infrastructure 615, Parking Plaza 7 Renovations ,000 2,000, Parking Plaza 8 Renovations ,000-2,000,000 - Santa Cruz and Middle Avenues Resurfacing - - 2,300, Sharon Road Sidewalk Installation - 935, Sidewalk Repair Program 7, , , , , ,000 Street Resurfacing Project 2,984,574 4,200,000 1,100,000 6,500,000 1,100,000 6,500,000 Welcome to Menlo Park Monument Signs - 180, , Willow Oaks Park Bicycle Connector , Subtotal $4,174,886 $6,015,000 $5,800,000 $9,000,000 $8,600,000 $7,000,000 CITY OF MENLO PARK BUDGET 139

164 Capital Improvement Plan Streets & Sidewalks CHILCO STREET AND SIDEWALK INSTALLATION This project involves the development of an engineering design and construction of landscaping, sidewalks, and bicycle facility improvements. The project includes landscaping, lighting, signing/ striping modifications, and pedestrian and bicycle improvements. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 43, DOWNTOWN PARKING STRUCTURE STUDY This project builds on preliminary parking structure concepts prepared as part of the 2012 El Camino Real Downtown Specific Plan, which focused on Parking Plazas 1, 2 and/or 3. The purpose of this project, would be to determine potential uses, siting, funding strategies and design of the structure. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 220, CITY OF MENLO PARK BUDGET

165 Capital Improvement Plan Streets & Sidewalks DOWNTOWN PARKING UTILITY UNDERGROUND This project would initiate an utility undregrounding district in the downtown area. An undergrounding district would provide framework to place overhead electrical and communication lines underground, which is consistent with the policy direction provided in the El Camino Real/Downtown Specific Plan and would be necessary for a potential future parking structure downtown. This project would be eligible for future funding through the Pacific Gas & Electric's Rule 20A program. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Downtown Parking Permits Fund - 200,000 5,500,000 $5,700,000 DOWNTOWN STREETSCAPE IMPROVEMENT This project plans and implements improvements in the downtown area per the Specific Plan. For fiscal year, the project will focus on the additional street cafes. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 303, ,000 $100,000 CITY OF MENLO PARK BUDGET 141

166 Capital Improvement Plan Streets & Sidewalks OAK GROVE SAFE ROUTES TO SCHOOL AND GREEN INFRASTRUCTURE This project would complete gaps in the pedestrian network along both sides of Oak Grove Avenue resulting in improved safety, accessibility, and connectivity to and from Nativity Catholic School and Menlo Atherton High School. In addition, the project incorporates green infrastructure that will catch and treat stormwater runoff, improving water quality. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Measure A Fund 615, PARKING PLAZA 7 RENOVATIONS This project provides needed improvements at Parking Plaza 7 including asphalt pavement rehabilitation, storm drainage, lighting and landscaping. The intent is for the work to be coordinated with the downtown parking utility underground project. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Downtown Parking Permits Fund - - 2,200,000 $2,200, CITY OF MENLO PARK BUDGET

167 Capital Improvement Plan Streets & Sidewalks PARKING PLAZA 8 RENOVATIONS This project provides needed improvements at Parking Plaza 8 including asphalt pavement rehabilitation, storm drainage, lighting and landscaping. The intent is for the work to be coordinated with the downtown parking utility underground project. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Downtown Parking Permits Fund - - 2,200,000 $2,200,000 SANTA CRUZ AND MIDDLE AVENUES RESURFACING The project involves the design and construction of street resurfacing work on Santa Cruz Avenue from Orange Avenue to Olive Street and of Middle Avenue from Olive Street to San Mateo Drive. The project also includes the construction of handicap ramps and selective sidewalk additions. Once completed, the project will result in significant improvements to the roadway infrastructure and pedestrian safety. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Construction Impact Fee Fund - - 2,300,000 $2,300,000 CITY OF MENLO PARK BUDGET 143

168 Capital Improvement Plan Streets & Sidewalks SHARON ROAD SIDEWALK INSTALLATION This project would install sidewalks on the north side of Sharon Road between Alameda de las Pulgas and Altschul Avenue. The project is anticipated to require parking to be removed from at least one side of the street. New sidewalks would provide an improved pedestrian connection between Alameda de las Pulgas and La Entrada Middle School, located just west of the project area. No work on this project is anticipated to commence in in fiscal year FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 935, SIDEWALK REPAIR PROGRAM This ongoing project consists of the removal of hazardous sidewalk offsets and the replacement of sidewalk sections that have been damaged by City tree roots in order to eliminate trip hazards. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Sidewalk Assessment 2, ,000 1,000,000 $1,250,000 General Capital Fund 5, ,000 1,000,000 $1,250,000 Subtotal 7, ,000 2,000,000 $2,500, CITY OF MENLO PARK BUDGET

169 Capital Improvement Plan Streets & Sidewalks STREET RESURFACING PROJECT This ongoing project includes the detailed design and selection of streets to be resurfaced throughout the City during the fiscal year and utilizes a Pavement Management System to assess the condition of existing streets and assist in the selection process. This project enhances the City s roadway network and improves safety. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 300, Highway Users Tax Fund 1,068,877 2,000,000 5,200,000 $7,200,000 Construction Impact Fee Fund 1,615,697 1,700,000 8,000,000 $9,700,000 SB1 LSRP Capital Fund - 500,000 2,000,000 $2,500,000 Subtotal 2,984,574 4,200,000 15,200,000 $19,400,000 WELCOME TO MENLO PARK MONUMENT SIGNS The project involves the design of Welcome to Menlo Park signs at approximately five key locations entering Menlo Park to further the City s brand as a desirable place to live, work and play. The proposed locations would include Sand Hill Road, Marsh Road, Willow Road, and both north and south ends of El Camino Real. The monument signs will meet the City s branding standards and comply with applicable Caltrans permitting requirements. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 180, ,000 $580,000 CITY OF MENLO PARK BUDGET 145

170 Capital Improvement Plan Streets & Sidewalks WILLOW OAKS PARK BICYCLE CONNECTOR This project upgrades the existing pedestrian pathway to accommodate both bicycles and pedestrians. It will also extend the pathway from Willow Road to Gilbert Avenue and widen the path to ten feet. Other improvements include adjustments to back flow prevention devices and storm drainage improvements near Pope Street to reduce ponding. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund ,000 $500, CITY OF MENLO PARK BUDGET

171 Capital Improvement Plan Traffic & Transportation TRAFFIC & TRANSPORTATION The Traffic and Transportation CIP provides for projects that improve multi-modal access and safety and manage the flow of traffic on City streets. Regional projects for which the City is an active partner, such as the Willow Road and US Highway 101 interchange, are also included. This category of the Capital Improvement Plan is supported by a variety of sources including funds from the State of California, impact fees, special gas tax levies, and countywide sales tax levies. Many of these projects are also supported by funds in the annual operating budget for routine maintenance of traffic signals, signs, and street markings, and for transportation planning efforts, such as the Safe Routes to Schools program. This category is also heavily supported by local, regional and state grant funding opportunities, such as competitive programs for bicycle and pedestrian improvements, railroad safety improvements, and traffic management strategies. Projected Carryover NEW REQUEST Future Funding Nees (unfunded) TRAFFIC & TRANSPORTATION Bayfront Expressway, Willow Road and Marsh Road Adaptive Signal $275, Dumbarton Rail Corridor Planning Support 20, El Camino Real Crossings Improvements 324, Haven Avenue Streetscape Improvement 706, Middle Avenue Caltrain Crossing Study Design and Construction 463,725 1,100,000-9,900, Middlefield Road at Linfield Drive and Santa Monica Avenue Crossing Improvements - 960, Oak Grove, University, Crane Bicycle Improvement Project 66, Pierce Road Sidewalk and San Mateo Drive Bike Route Installation - 1,007, Ravenswood Avenue/Caltrain Grade Separation 3, ,000, Traffic Signal Modifications 290, , , , , ,000 Transit Improvements 85, Transportation Master Plan 54, Transportation Projects (Minor) 75, , , , , ,000 Willow Road Transportation Study 159, Willow/101 Interchange 113, Willows Neighborhood Complete streets 300, Subtotal $2,937,151 $3,567,000 $500,000 $35,400,000 $500,000 $500,000 CITY OF MENLO PARK BUDGET 147

172 Capital Improvement Plan Traffic & Transportation BAYFRONT EXPRESSWAY, WILLOW ROAD AND MARSH ROAD ADAPTIVE SIGNAL An adaptive signal timing dynamically adjusts signal timing at traffic signals in real-time to accommodate changing traffic conditions such as what these corridors are currently experiencing. This system will improve travel time reliability, ease traffic congestion, and reduce fuel consumption. This project will install an adaptive traffic signal system on the Bayfront Expressway, Willow Road and Marsh Road corridors. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Measure A Fund 275, DUMBARTON RAIL CORRIDOR PLANNING SUPPORT This ongoing project provides planning support for the Dumbarton Rail Corridor project within Menlo Park, including coordination with local and regional stakeholders, potential station planning, alternatives analysis, and exploration of project phasing opportunities. It builds on the land use and circulation planning work in the Connect Menlo General Plan Update. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Fund 20, CITY OF MENLO PARK BUDGET

173 Capital Improvement Plan Traffic & Transportation EL CAMINO REAL CROSSINGS IMPROVEMENTS This project designs improvements for east-west connections as identified in the El Camino Real Corridor Study. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 324, HAVEN AVENUE STREETSCAPE IMPROVEMENT This project provides new bicycle and pedestrian facilities to Haven Avenue, connecting Menlo Park, San Mateo County and Redwood City residents and employees. It provides a direct connection to the San Francisco Bay Trail, functioning as an interim gap closure of the Bay Trail between Bedwell Bayfront Park and Seaport Boulevard, better serving commute and recreational needs. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 706, CITY OF MENLO PARK BUDGET 149

174 Capital Improvement Plan Traffic & Transportation MIDDLE AVENUE CALTRAIN CROSSING STUDY DESIGN AND CONSTRUCTION This project would provide a grade-separated crossing through the Caltrain railway to create a pedestrian/ bicycle connection near Middle Avenue, between Alma Street near Burgess Park and El Camino Real at the proposed open space plaza as identified in the El Camino Real/Downtown Specific Plan. The project is currently in a study phase to develop preliminary design alternatives, seek community feedback around a preferred alternative and complete environmental clearance. In Fiscal Year , the funds requested would be used to initiate engineering design of a preferred alternative. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 463,725 1,100,000 9,900,000 $11,000,000 MIDDLEFIELD ROAD AT LINFIELD DRIVE AND SANTA MONICA AVENUE CROSSING IMPROVEMENTS This project would evaluate and complete engineering design for crossing improvements at the Middlefield Road/Linfield Drive and Santa Monica Avenue intersections. This project effort would include coordination with Menlo Park Fire Protection District for emergency access considerations to Station 1 adjacent to the intersection. No work on this project is anticipated to commence in fiscal year Work is anticipated to be coordinated with Menlo Fire s plans to reconstruct Station 1, and funding is contingent upon receiving matching funds from Menlo Fire. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund - 960, CITY OF MENLO PARK BUDGET

175 Capital Improvement Plan Traffic & Transportation OAK GROVE, UNIVERSITY, CRANE BICYCLE IMPROVEMENT PROJECT This project will conduct an evaluation of the one-year pilot installation of bicycle facilities on Oak Grove Avenue, University Drive and Crane Street to determine whether the project should be made permanent, modified, or removed. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 66, PIERCE ROAD SIDEWALK AND SAN MATEO DRIVE BIKE ROUTE INSTALLATION This project will construct a number of bicycle and pedestrian enhancements in the City, including sidewalk construction on Pierce Road between Ringwood Avenue and Carlton Avenue, bicycle route improvements on San Mateo Drive including crossing enhancements at Middle Avenue, crossing enhancements at Middle Avenue/Blake Street, and sidewalk construction at Coleman Avenue and Santa Monica Avenue. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund - 1,007,000 - $1,007,000 CITY OF MENLO PARK BUDGET 151

176 Capital Improvement Plan Traffic & Transportation RAVENSWOOD AVENUE/CALTRAIN GRADE SEPARATION The existing Ravenswood Avenue Caltrain crossing is a critical rail crossing within Menlo Park. It is within the Menlo Park El Camino Real/Downtown Specific Plan Area and falls within the City s Priority Development Area. The project would advance engineering design of the chosen preferred alternative, an underpass of Ravenswood Avenue. Oak Grove, Glenwood, and Encinal Avenues would remain at-grade and open to traffic. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 3,425-25,000,000 $25,000,000 TRAFFIC SIGNALS MODIFICATIONS This annual project provides funds to upgrade City traffic signals. Funds would be used to replace equipment nearing the end of its useful life, enhance signal phasing and timing, and upgrade existing signals to current standards. The funds provided will generally allow a complete upgrade of a single intersection or upgrades to components of approximately three signals per year. Projects will be prioritized for implementation through the Transportation Master Plan. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 290, ,000 1,400,000 $2,040, CITY OF MENLO PARK BUDGET

177 Capital Improvement Plan Traffic & Transportation TRANSIT IMPROVEMENTS The purpose of this project is to support development of transit options and improvements in Menlo Park. Improvements to bus stop amenities (benches, new signs, schedules and markings to guide shuttle users) will be installed through this project. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 85, TRANSPORTATION MASTER PLAN The development of a Transportation Master Plan allows the City to identify and prioritize transportation infrastructure investments to overcome existing barriers and identify safe multimodal routes to key destinations in the City. The Plan builds on and ultimately supplants the 2005 Comprehensive Bicycle Development Plan and the 2009 Sidewalk Master Plan. The Plan was identified in the City s Circulation Element as part of the ConnectMenlo General Plan Update. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 54, CITY OF MENLO PARK BUDGET 153

178 Capital Improvement Plan Traffic & Transportation TRANSPORTATION PROJECTS (MINOR) This annual project supports small transportation projects such as minor crosswalk enhancements, bicycle lane gap closures, traffic signal modifications and sign/ striping installations and restores routine maintenance levels for more timely response to resident complaints. Projects will be prioritized for implementation through the Transportation Master Plan. Funding will help address issues identified through initiation of the safe routes to school program FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Measure A Fund - 75, ,000 $375,000 Transportation Impact Fee Fund 75, General Capital Fund - 75, ,000 $375,000 Subtotal 75, , ,000 $750,000 WILLOW ROAD TRANSPORTATION STUDY Travel time and congestion on Willow Road between Middlefield Road and Bayfront Expressway has increased significantly since 2013 as a result of regional traffic growth in the mid-peninsula region. In 2008, the City/County Association of Governments of San Mateo County(C/CAG) completed the Gateway Corridor Study, which identified transportation improvements for Willow Road, University Avenue, and Bayfront Expressway and analyzed cost-benefits of each improvement. This proposed study builds on the C/CAG study and the City s current Connect Menlo General Plan Update to identify any short-term modifications and prioritize the long-term projects that the City can advocate for regionally to improve traffic conditions on Willow Road. Coordination with C/CAG, the Cities of Palo Alto and East Palo Alto, and Caltrans is an important aspect of this project. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Transportation Impact Fee Fund 159, CITY OF MENLO PARK BUDGET

179 Capital Improvement Plan Traffic & Transportation WILLOW/101 INTERCHANGE Reconstruction of the U.S. Highway 101/Willow Interchange began in 2017 and will last approximately two years. Caltrans is leading the construction efforts. The City s role is to support the project through construction by assisting with communication efforts on construction impacts, traffic controls, and detours; provide local coordination, required permit review for local street impacts; and provide inspection of construction within City right-of-way. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 113, WILLOWS NEIGHBORHOOD COMPLETE STREETS This project expands the previously identified Laurel Upper School Safe Routes to School Plan to address cut-through traffic concerns in the Willows neighborhood. The scope of the project is anticipated to include Safe Routes to Schools improvements to the Laurel Upper School enrollment area (extending across Willow Road) to facilitate travel by students to the school site, as well as cut-through traffic analysis in the Willows neighborhood (generally bounded by Woodland Avenue, Willow Road, U.S. Highway 101 and University Avenue). The improvements will also benefit students traveling to other nearby schools. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED General Capital Fund 300, CITY OF MENLO PARK BUDGET 155

180 Capital Improvement Plan 156 CITY OF MENLO PARK BUDGET

181 Capital Improvement Plan Water WATER Water CIP projects improve the delivery of safe drinking water to those residents served by the City s municipal water service. This category of the CIP is supported by water ratepayers and capacity charges paid by new connections to the water system. Other possible funding strategies for these projects include grants, the issuance of water revenue bonds, State low interest loans, as well as the development of benefit assessment districts that can pay for improvements in specific sections of the City where more investment needs have been identified. Projected Carryover NEW REQUEST Future Funding Nees (unfunded) WATER Automated Water Meter Reading $500,000 $600,000 $1,800,000 $1,200,000 $400,000 - Emergency Water Storage / Supply 4,209,541 2,000,000 2,800,000 2,800, Fire Flow Capacity Improvements - - 1,000,000 1,000,000 1,000,000 1,500,000 Reservoir No. 2 Roof Replacement 1,490,686 2,650, Reservoirs #1 & #2 Mixers 114, Urban Water Management Plan , Water Main Replacement Project 1,241, ,000 2,050,000 3,600,000 1,800,000 1,800,000 Subtotal $7,556,678 $5,850,000 $7,790,000 $8,600,000 $3,200,000 $3,300,000 CITY OF MENLO PARK BUDGET 157

182 Capital Improvement Plan Water AUTOMATED WATER METER READING This project involves the installation of a radio based communication system to enable Menlo Park Municipal Water to read water meters automatically rather than manually. With this upgrade, the accuracy of meter reads would be improved, resulting in the timely detection of water leaks, reduction of water loss and improved customer service. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund 500, ,000 3,400,000 $4,000,000 EMERGENCY WATER STORAGE / SUPPLY This project involves the development of up to three emergency standby wells to provide a secondary water supply in Menlo Park Municipal Water s lower zone service area. An emergency water supply would be needed in the event of an outage of the Hetch Hetchy system. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund 4,209,541 2,000,000 5,600,000 $7,600, CITY OF MENLO PARK BUDGET

183 Capital Improvement Plan Water FIRE FLOW CAPACITY IMPROVEMENTS This project involves the planning, design and implementation of water infrastructure improvements recommended in the Water System Master Plan to address fire flow capacity deficiencies identified throughout the Menlo Park Municipal Water service area. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund - - 4,500,000 $4,500,000 RESERVOIR NO. 2 ROOF REPLACEMENT The project involves the replacement of the roof on Reservoir 2, which is deteriorating and at the end of its life expectancy. The replacement would ensure continued public health protection and system reliability. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund 1,490,686 2,650,000 - $2,650,000 CITY OF MENLO PARK BUDGET 159

184 Capital Improvement Plan Water RESERVOIRS #1 & #2 MIXERS This project funds the purchase and installation of solarpowered mixers for Reservoir #1 and Reservoir #2 to improve water quality. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund 114, URBAN WATER MANAGEMENT PLAN This project involves the preparation of Menlo Park Municipal Water s Urban Water Management Plan as required by the State. Due in 2020, the plan is developed every five years and assesses water supply and demand conditions. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund ,000 $140, CITY OF MENLO PARK BUDGET

185 Capital Improvement Plan Water WATER MAIN REPLACEMENT PROJECT This project is ongoing and focuses on the design and replacement of the City s aging water supply system to ensure continued public health protection and system reliability. Using a condition assessment based on pipe age, material, size and hazards, sections of the water system that are most vulnerable to failure are selected for replacement. FUNDING SOURCE Projected Carryover NEW REQUEST Future Funding Need TOTAL NEW AND FUTURE FUNDING REQUIRED Water Capital Fund 1,241, ,000 9,250,000 $9,850,000 CITY OF MENLO PARK BUDGET 161

186 Capital Improvement Plan 162 CITY OF MENLO PARK BUDGET

187 Capital Improvement Plan Funding Sources 5-year Projection This section details the impact of the 5-year CIP on the various funding sources identified in the project contained in earlier sections. Information detailed in the revenue section of each table is based on a combination of estimates developed by City staff, consultants or outside governmental agencies that provide the funding. Some funds have both operational and capital functions, for example the Highway Users' Tax Fund. The expenditures are provided for both CIP and Non-CIP to assist the reader in their understanding of the various demands on each fund. Non-CIP expenditures are transfers out are reflected in the operating department responsible for the activity. In most cases the operating department is Public Works. BAYFRONT LANDFILL FUND Available balance $4,664,500 $5,020,022 $5,378,571 $5,740,027 $6,158,116 Revenues & transfers-in 856, , , ,978 1,054,708 CIP expenditures Non-CIP expenditures & transfers out 500, , , , ,311 ENDING FUND BALANCE $5,020,022 $5,378,571 $5,740,027 $6,158,116 $6,638,513 The Bayfront Landfill Fund is utilized to account for prior-year fees that were charged to the public for trash hauled to the City s landfill site. This fund is now used to operate and maintain the gas collection and leachate systems at the closed landfill. CONSTRUCTION IMPACT FEE FUND Available balance $3,066,197 $3,586,828 $2,814,485 $325,610 $819,625 Revenues & transfers-in 2,677,000 2,000,000 2,000,000 1,000,000 1,000,000 CIP expenditures 1,700,000 2,300,000 4,000,000-4,000,000 Non-CIP expenditures & transfers out 456, , , , ,695 ENDING FUND BALANCE $3,586,828 $2,814,485 $325,610 $819,625 ($2,704,070) The Construction Impact Fee Fund was established to account for developer fees paid to mitigate pavement damage due to heavy construction activity. The bulk of these expenditures are dedicated to support the street resurfacing program which exceed revenue and fund balance beginning in fiscal year This fund is subject to annual reporting under California AB1600 Mitigation Fee Act. CITY OF MENLO PARK BUDGET 163

188 Capital Improvement Plan DOWNTOWN PARKING PERMITS FUND Available balance $4,354,640 $4,298,551 $3,545,721 $1,696,211 ($149,916) Revenues & transfers-in 355, , ,044 5,388, ,006 CIP expenditures 200, ,000 2,000,000 7,000,000 - Non-CIP expenditures & transfers out 211, , , , ,689 ENDING FUND BALANCE $4,298,551 $3,545,721 $1,696,211 ($149,916) $7,401 The Downtown Parking Permits fund was established to pay for the ongoing maintenance and capital of the infrastructure of the Central Business District (CBD). The CBD is the area covered by El Camino Real, Oak Grove, University and Menlo Avenue. The majority of the fund is set aside for the reconstruction of the parking plazas. It is also used to fund the cleaning of the parking plazas and landscaping on Santa Cruz and parking plazas. A noticeable increase in revenue can be seen in as Rule 20A funding is available once the Downtown Parking Utility Underground project begins. GENERAL CAPITAL FUND Available balance $2,069,606 $2,291,663 ($5,648,969) ($7,584,969) ($8,963,950) Revenues & transfers-in 7,275,000 3,888,250 4,004,898 4,125,044 4,248,796 CIP expenditures 5,855,000 10,595,000 4,670,000 4,195,000 3,695,000 Non-CIP expenditures & transfers out 1,197,943 1,233,882 1,270,898 1,309,025 1,348,296 ENDING FUND BALANCE $2,291,663 ($5,648,969) ($7,584,969) ($8,963,950) ($9,758,450) This fund is utilized to provide adequate funding for maintenance of the City s current infrastructure including: playground park improvements to Burgess Park, Willow Oaks Park and Nealon Park; Belle Haven Child Development Center Kitchen and Restroom Remodel; tennis court maintenance; and partial funding for the sidewalk repair program. The deficit arises out of anticipated expenditures to fully fund the Information Technology Master Plan as well as Bedwell-Bayfront Park Master Plan projects. HIGHWAY USERS TAX FUND Available balance $1,520,756 $324,142 $555,646 ($583,748) ($293,020) Revenues & transfers-in 940, ,831 1,007,916 1,043,193 1,079,704 CIP expenditures 2,000, ,000 2,000, ,000 2,000,000 Non-CIP expenditures & transfers out 137, , , , ,801 ENDING FUND BALANCE $324,142 $555,646 ($583,748) ($293,020) ($1,371,116) The Highway Users Tax Fund accounts for revenues and expenditures related to the City s allocation of the State gasoline taxes. The five-year plan anticipates revenue being insufficient to fulfill the City s historic use of this Fund for the annual street resurfacing and improvement program. 164 CITY OF MENLO PARK BUDGET

189 Capital Improvement Plan LIBRARY SYSTEM IMPROVEMENTS FUND Available balance $720,000 $470,000 $470,000 $470,000 $470,000 Revenues & transfers-in CIP expenditures 250, Non-CIP expenditures & transfers out ENDING FUND BALANCE $470,000 $470,000 $470,000 $470,000 $470,000 Established in October, 2017, the Library System Improvements Fund is used for all costs associated with library system improvements. MEASURE A FUND Available balance $471,269 $1,135,027 $1,820,947 $2,529,695 $3,261,955 Revenues & transfers-in 1,305,500 1,344,665 1,385,005 1,426,555 1,469,352 CIP expenditures 75,000 75,000 75,000 75,000 75,000 Non-CIP expenditures & transfers out 566, , , , ,874 ENDING FUND BALANCE $1,135,027 $1,820,947 $2,529,695 $3,261,955 $4,018,433 This fund accounts for the City s portion of the countywide half-cent sales tax used for City transportation purposes. This fund formerly accounted for all transportation taxes, however in , the funds were broken into separate and distinct funds for each revenue source e.g. Measure A, Measure M and Transportation Shuttles. MEASURE T BOND FUND Available balance $300,781 $301,431 $302,038 $302,632 $303,244 Revenues & transfers-in 1,560 1,607 1,655 1,705 1,756 CIP expenditures Non-CIP expenditures & transfers out 1,000 1,030 1,061 1,093 1,126 ENDING FUND BALANCE $301,431 $302,038 $302,632 $303,244 $303,874 This fund was established to account for the proceeds of the 2002 Measure T Recreation Improvements Bond Issue used to construct improvements to the City s parks and recreation facilities. CITY OF MENLO PARK BUDGET 165

190 Capital Improvement Plan RECREATION IN-LIEU FEE FUND Available balance $2,398,525 $2,412,089 $2,720,821 $3,395,915 $3,567,262 Revenues & transfers-in 506,300 1,000,000 1,000, , ,000 CIP expenditures 375, , , ,000 - Non-CIP expenditures & transfers out 117, , , , ,513 ENDING FUND BALANCE $2,412,089 $2,720,821 $3,395,915 $3,567,262 $3,934,749 The Recreation In-lieu Fund accounts for developer fees paid in-lieu of building new recreation facilities to offset the development s impacts. The City uses these funds to improve and expand recreation facilities. This fund is subject to annual reporting under California AB1600 Mitigation Fee Act. SB1 LSRP CAPITAL FUND Available balance Revenues & transfers-in $590,000 $607,700 $625,931 $644,709 $664,050 CIP expenditures 500, , , , ,000 Non-CIP expenditures & transfers out 90, , , , ,050 ENDING FUND BALANCE In April 2017, the California Legislature passed the Local Streets and Roads Program Act (LSRP) Senate Bill 1 (SB 1), raising gas taxes and vehicle fees that will be used towards deferred maintenance on the state highways and local streets and roads. The SB1 Fund accounts for these funds. SIDEWALK ASSESSMENT FUND Available balance $29,788 $29,788 $29,788 $29,788 $29,788 Revenues & transfers-in 250, , , , ,000 CIP expenditures 250, , , , ,000 Non-CIP expenditures & transfers out ENDING FUND BALANCE $29,788 $29,788 $29,788 $29,788 $29,788 This fund accounts for property tax assessments collected under the Landscaping and Lighting Act of These funds are utilized for the sole purpose of repairing and replacing hazardous sidewalks and curbs. 166 CITY OF MENLO PARK BUDGET

191 Capital Improvement Plan TRANSPORTATION IMPACT FEE FUND Available balance $3,814,752 $3,199,284 $3,345,376 ($26,426,169) ($26,815,968) Revenues & transfers-in 2,328,400 1,000,000 6,000, , ,000 CIP expenditures 2,457, ,000 35,250, , ,000 Non-CIP expenditures & transfers out 486, , , , ,692 ENDING FUND BALANCE $3,199,284 $3,345,376 ($26,426,169) ($26,815,968) ($27,224,660) This fund accounts for transportation impact fee (TIF) charged to developers used to mitigate City traffic problems that result either directly or indirectly from development. The significant expenditure shown in fiscal year is anticipated funding for rail separation projects that my be eligible for grant funds heretofore unindentified. This fund is subject to annual reporting under California AB1600 Mitigation Fee Act. WATER CAPITAL FUND Available balance $4,508,111 $61,663 ($5,904,751) ($12,863,386) ($14,432,780) Revenues & transfers-in 1,741,600 2,171,775 2,000,000 2,000,000 2,000,000 CIP expenditures 5,850,000 7,790,000 8,600,000 3,200,000 3,300,000 Non-CIP expenditures & transfers out 338, , , , ,476 ENDING FUND BALANCE $61,663 ($5,904,751) ($12,863,386) ($14,432,780) ($16,113,256) The Water Capital Improvement fund accounts for the proceeds of the capital surcharge from water operations and is utilized for construction improvements of the water infrastructure. CITY OF MENLO PARK BUDGET 167

192 168 CITY OF MENLO PARK BUDGET

193 APPENDIX CITY OF MENLO PARK BUDGET 169

194 Appendix Glossary of budget terms ACCOUNTS PAYABLE A short-term liability account reflecting amounts owed to private persons or organizations for goods and services received by a government. ACCOUNTS RECEIVABLE An asset account reflecting amounts due from private persons or organizations for goods and services furnished by a government (but not including amounts due from other funds or other governments). ACCRUAL BASIS OF ACCOUNTING A method of accounting that recognizes the financial effect of transactions, events and interfund activities when they occur, regardless of the timing of related cash flows. ADOPTED BUDGET The City Council approved annual budget establishing the legal authority for the expenditure of funds as set forth in the adopting City Council budget resolution. AMORTIZATION The process of decreasing or allocating a lump sum amount over a period of time, particularly for loans and other forms of finance, including related interest and other finance charges. APPROPRIATION Legal authorization granted to the City Manager by the City Council to expend monies, and/or to incur legal obligations for specific departmental purposes. An appropriation is usually limited in amount, as well as time frame. ASSESSED VALUATION A dollar value placed upon real estate or other property by San Mateo County as a basis for levying property taxes. ASSETS Property owned by a government, which has monetary value. AUDIT Prepared by an independent certified public accountant (CPA), the primary objective of an audit is to determine if the City s financial statements fairly present the City s financial position and results of operations in conformity with generally accepted accounting principles. AUTHORIZED POSITIONS Regular employee positions authorized in the budget during the fiscal year. BASIS OF ACCOUNTING The timing of recognition of transactions or events for financial reporting or budgeting purposes. The three basis of accounting for governmental agencies are: (1) cash basis (when cash is received or paid), (2) accrual basis (when the underlying transaction or event takes place), and (3) modified accrual basis (revenues are recognized in the accounting period in which they become available and measurable and expenditures are recognized in the accounting period in which the fund liability occurred). BALANCE SHEET A statement purporting to present the financial position of an entity by disclosing the value of its assets, liabilities and equities as of a specific date. BALANCED BUDGET When the total of revenues and other financing sources is equal to or greater than the total of expenditures and other financing uses, the budget is balanced. BEGINNING FUND BALANCE Fund balance available in a fund from the end of the prior year for use in the following year. BOND The way in which a city may raise capital by issuing a written promise to pay a specified sum of money, called the face value or principal amount, at a specified date or dates in the future, together with periodic interest at a special rate. BOND RATING An evaluation of a bond issuer s credit quality and perceived ability to pay the principal and interest on time and in full. BUDGET A plan of financial and program operation listing an estimate of proposed appropriations or expenses and the proposed means of financing them, for a particular period. The budget is proposed or preliminary until it has been adopted by the City Council. BUDGET CALENDAR The schedule of key dates or milestones, which a government follows in preparation and adoption of a budget. 170 CITY OF MENLO PARK BUDGET

195 Appendix Glossary of budget terms BUDGET ADOPTION Formal action by the City Council setting the spending path for the year. BUDGETARY CONTROL The control or management of a government or enterprise in accordance with an approved budget for the purpose of keeping expenditures within the limitations of available appropriations and revenues. CALPERS California s public employee retirement system. CAPITAL ASSET A tangible, fixed asset that is long-term in nature, of significant value and obtained or controlled because of past transactions, events or circumstances. Fixed assets include land, buildings, equipment, improvements to buildings and infrastructure (i.e., streets, highways, bridges and other immovable assets). A capital asset is defined as an asset with a useful life extending beyond a single accounting period. CAPITAL BUDGET A financial plan of proposed capital improvement projects and the means of financing them for a given period. CAPITAL OUTLAY A budget category which budgets all equipment having a unit cost of more than $5,000 and an estimated useful life of more than one year. Capital Outlay items are budgeted in the operating budget. CAPITAL IMPROVEMENT PLAN (CIP) Improvements that cost over $25,000 and have a useful life of three years or more, or involve public works construction. The City may own completed projects, or the City may maintain a legal interest in the completed project. Examples of projects owned by the City include a new park, street resurfacing, modifications to buildings and construction of water mains. An example of a project in which the City maintains a legal interest is a privately owned housing project with an outstanding promissory note to the City. CASH BASIS OF ACCOUNTING A basis of accounting under which transactions are recognized only when cash is received or disbursed. CITY COUNCIL WORK PLAN Strategic work objectives defined by the City Council at their annual planning session requiring collaborative action by several City departments and partnerships with other elements of the community that define the scope of staff work, and so the city budget, for any given year. CITY MANAGER S BUDGET MESSAGE Also known as the budget transmittal letter, this is a general discussion of the proposed budget as presented in writing by the City Manager to the City Council. The message contains an explanation of the principal budget items and summarizes the proposed budget relative to the current year adopted budget. COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) The official annual report of the City s financial condition at the conclusion of the fiscal year. The report is prepared to conform to Generally Accepted Accounting Principles (GAAP) for governmental units and presentation of the financial data in conformity with the adopted budget. CONSUMER PRICE INDEX A statistical description of price levels provided by the U.S. Department of Labor. The change in this index from year to year is used to measure the cost of living and economic inflation. CONTINGENCY A budgetary reserve set aside for emergency or unanticipated expenditures, revenue shortfalls, and/or unknown expenditures. DEPARTMENT An operational and budgetary unit designated by the City Council to define and organize City operations, or a group of related operations within a functional area. DEBT An obligation resulting from the borrowing of money or from the purchase of goods and services. Debts of governments include bonds, time warrants and notes. DEBT FINANCING Issuance of bonds and other instruments to finance municipal improvements and services. CITY OF MENLO PARK BUDGET 171

196 Appendix Glossary of budget terms DEBT SERVICE Refers to the interest and principal payments on bond issues and includes the issuance costs related to bond funding. DEFICIT The excess of an entity s liabilities over its assets or the excess of expenditures or expenses over revenue during a single accounting period. DEPRECIATION (1) Expiration in the service life of capital outlay assets attributable to wear and tear, deterioration, action of the physical elements, inadequacy or obsolescence. (2) The portion of the cost of a capital asset that is charged as an expense during a particular period. DIVISION An organizational unit consisting of program(s) or activity(ies) within a department furthering the objectives of the City Council by providing services or a product. ENCUMBRANCES Financial commitments related to unperformed contracts for goods or services for which part of an appropriation is reserved. They cease to be encumbrances when the obligations are paid or otherwise terminated. ENTERPRISE FUND Enterprise funds are used for services provided to the public on a user charge basis, similar to the operation of a commercial enterprise. Water utilities are common examples of government enterprises. ENVIRONMENTAL IMPACT REPORT (EIR) An analysis of the environmental implications related to a specific action. For example, the increase in traffic in an area proposed for new development. EXPENDITURE The payment made for cost of services rendered, materials and equipment, and capital improvements. EXPENSE Charges incurred (whether paid immediately or unpaid) for operations, maintenance, interest or other charges. FEE The payment for direct receipt of a public service by the party who benefits from the service. FIDUCIARY FUND A fund type reporting assets held in a trustee or agency capacity for others and which, therefore, cannot be used to support the government s own programs. Examples include pension, trust funds, investment trust funds, private-purpose trust funds and agency funds. FISCAL YEAR A 12-month accounting period of time to which the budget applies; for Menlo Park, it is July 1 through June 30. FRINGE BENEFITS Benefits including employee retirement, Social Security, health, dental, vision, life insurance, workers compensation, uniforms and deferred compensation plans. FTE Full time equivalent employee (FTE) hours per year = 1.0 full-time equivalent position. FUND An independent fiscal and accounting entity used to record all financial transactions related to the specific purpose for which the fund was created. There are three major types of fund: Governmental (general, special revenue, debt service, capital projects and permanent), Proprietary (enterprise and internal service), and Fiduciary (trust and agency). FUND BALANCE The amount of financial resources immediately available for use. Generally, this represents the excess of unrestricted current assets over current liabilities. GANN APPROPRIATION LIMIT Article XIIIB of the state constitution was amended by Proposition 4 (Gann initiative) in Article XIIIB limits growth in the spending of tax proceeds to tax proceeds appropriated in the base year of times the product of the allowable annual percentage change in a cost-of-living factor and the allowable annual percentage change in a population change factor. The cost-of-living factor is the larger of the annual percentage change in the State per capita personal income or the annual percentage change in the local non-residential assessed valuation due to new construction. The population change factor is the larger of the annual percentage change of the jurisdiction s population or the annual percentage population change of the county in which the jurisdiction is located. 172 CITY OF MENLO PARK BUDGET

197 Appendix Glossary of budget terms GENERAL FUND The City s primary fund used to account for all revenues and expenditures not legally restricted as to use. Examples of departments financed by the General Fund include Police and Library. GENERAL OBLIGATION BOND A type of bond that is backed by the full faith, credit and taxing power of the City. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) Uniform minimum standards and guidelines for financial accounting and reporting. They govern the form and content of the financial statements of an entity. GAAP encompass the conventions, rules, and procedures necessary to define accepted accounting practice at a particular time. They include not only broad guidelines of general application, but also detailed practices and procedures. GAAP provide a standard by which to measure financial presentations. The primary authoritative body on the application of GAAP to state and local governments is the GASB. GOVERNMENTAL ACCOUNTING The composite activity of analyzing, recording, summarizing, reporting and interpreting the financial transactions of governments. GOVERNMENTAL ACCOUNTING STANDARDS BOARD (GASB) The authoritative accounting and financial reporting standard-setting body for government entities. GOVERNMENTAL FUND A fund type used to account for tax-supported activities. There are five different types of governmental funds: the general fund, special revenue funds, debt service funds, capital projects funds and permanent funds. GRANT Contributions or gifts of cash or other assets from another (usually governmental) entity to be used or expended for a specific purpose, activity or facility. An example is the Community Development Block Grant given by the federal government. INFRASTRUCTURE Facilities on which the continuance and growth of a community depend such as roads, water lines, sewers, public buildings, parks and airports. INTERFUND TRANSACTIONS These budgetary transactions consist of: quasi-external transactions that would be treated as revenues and expenditures if they involved organizations external to the governmental unit; reimbursements of expenditures initially made in one fund that are attributable to another fund; and operating transfers where monies are appropriated from one fund to another fund to reimburse expenses that benefit the first fund. INTERNAL SERVICE FUND Funds used to account for the financing of goods or services provided by one department or agency to other departments or agencies of a government, on a cost reimbursement basis. LIABILITY Debt or other legal obligations arising out of transactions in the past that must be liquidated, renewed, or refunded at some future date. Note: This term does not include encumbrances. LINE ITEM DETAIL A budget that lists detailed expenditure categories (permanent salaries, utilities, travel, training, etc.) separately, along with the amount budgeted for each specified category. LONG-TERM DEBT Debt with a maturity of more than one year after the date of issue. MODIFIED ACCRUAL BASIS OF ACCOUNTING The basis of accounting where revenues are recognized in the accounting period in which they become available and measurable; expenditures are recognized in the accounting period in which the fund liability is incurred (if measurable), except for unmatured interest on general long-term debt and certain similar accrued obligations. MUNICIPAL CODE The compilation of City Council approved ordinances currently in effect. The Code defines City policy in various categories, for example: Civil Service rules, traffic regulations, sanitation and health standards, building regulations, and planning and zoning regulations. CITY OF MENLO PARK BUDGET 173

198 Appendix Glossary of budget terms OPERATING BUDGET A financial, programmatic and organizational plan for furthering the goals of the City Council through the departments of the City, which does not include onetime capital improvement projects. ORDINANCE A formal legislative enactment by the City Council having the full force and effect of law within the City boundaries unless it is in conflict with any higher form of law such as a State statute or constitutional provision. An ordinance has higher legal standing than a resolution. PAY-AS-YOU-GO BASIS Used to describe a financial policy by which capital outlays are financed from current revenues rather than through borrowing. PROPRIETARY FUND Funds that focus on the determination of operating income, changes in net assets (cost recovery), financial position and cash flows. There are two types of proprietary funds: Enterprise and Internal Service Funds. PURCHASE ORDER A document issued to authorize a vendor to deliver specified merchandise or render a specified service for a stated estimated price. Outstanding purchase orders are called encumbrances. RE-APPROPRIATION The amount of money that is budgeted for a project in a prior year but is not spent or encumbered and needs to be appropriated again in the current year in order to continue the program originally intended. REIMBURSEMENTS Payments of amounts remitted on behalf of another party, department or fund. They are recorded as expenditures or expenses in the reimbursing fund and as reductions of the expenditure or expense in the fund that is reimbursed (see Interfund Transactions). RESERVE An account used to set aside a portion of the fund balance as legally segregated for a specific use. RESOLUTION A special order of the City Council that requires less legal formality than an ordinance in terms of public notice and the number of public readings before approval. A resolution has lower legal standing than an ordinance. The adopted City budget is approved by resolution and requires a majority vote of the City Councilmembers present at budget adoption time. REVENUE Sources of income used to finance City governmental services. SELF-INSURANCE A term often used to describe an entity s retention of risk or loss arising out of the ownership of property or the activity of the agency. SPECIAL REVENUE FUNDS Special revenue funds are accounts established to collect money that must be used for a specific purpose. Special revenue funds provide an extra level of accountability and transparency to taxpayers ensuring tax dollars go toward an intended purpose. TAXES Compulsory charges levied by a government for financing services performed for common benefit. This term does not include charges for services, for example refuse collection. TRANSIENT OCCUPANCY TAX (TOT) A tax on hotel/motel stays 30 days or less. The rate in the City of Menlo Park is currently 12 percent. TRUST AND AGENCY FUNDS Types of fiduciary funds that account for assets held by the City in a trustee capacity. The budget does not appropriate fiduciary funds. VEHICLE LICENSE FEE Vehicle License Fee (VLF) is an annual fee on the ownership of a registered vehicle in California. It has been assessed on all privately owned registered vehicles in California in place of taxing vehicles as personal property since The VLF is paid to the Department of Motor Vehicles (DMV) at the time of annual vehicle registration. A portion of VLF had traditionally been apportioned to cities on a per capita basis. However, effective July 1, 2011, virtually all VLF revenues previously apportioned to cities were shifted to fund law enforcement grants as a part of efforts to solve the State s chronic budget problems. 174 CITY OF MENLO PARK BUDGET 2 CITY OF MENLO PARK BUDGET

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200 2018 The City of Menlo Park 176 CITY OF MENLO PARK BUDGET