COUNCIL AGENDA STAFF REPORT

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3 CITY OF AMERICAN CANYON SUBJECT: COUNCIL AGENDA STAFF REPORT Meeting Date: May 21, 2013 SPECIAL WORKSHOP ITEM: 1 Conduct a City Council Study Session on the City s Operating Budget for fiscal year , the first year of the General Fund s three year Stabilization Plan and review budgets for the General, Water Enterprise, Wastewater Enterprise and Affordable Housing Funds SUBMITTED BY: Dana Shigley, City Manager Barry Whitley, Finance Director DISCUSSION: Background In 2010, as the impacts of the great recession became clear, the City Council adopted a three-year budget deficit elimination plan designed to cut expenses back to meet significant reductions in projected revenues. While the SDEP resulted in reductions in services to the community, as well as reduced income to employees, the plan was successful in reducing expenses to match revenues. During that three year period, the General Fund balance remained virtually unchanged. The three year SDEP plan ends at the conclusion of the 2012/2013 fiscal year. While revenues and expenses have been balanced, it is important to remember the substantial reductions we experienced to make that happen. These include: o TOT and gaming tax increases o Suspend all COLAs and management increases o Eliminated 13 staff positions, resulting in reduced public services in planning, parks maintenance, street maintenance, and elsewhere o Implemented 15 unpaid furlough days per year o Suspended equipment replacements, including all non-safety vehicles and computer equipment o Eliminated all additions to City reserves o Suspended vehicle allowances for management and Council o Shifted debt service expenses to capital accounts o Eliminated community programs, including Friday Night at the Plaza and community grants o Reduced funding for Post-employment Medical Benefits to minimal

4 amounts (resulting in increasing liability to the City in the future) o Close City Hall for one week in November and one week in December As the SDEP comes to a close and revenues are growing again, we are prepared to start restoring these cuts in the General Fund budget. However, it is not possible to add everything back at once and I am proposing a new three-year Stabilizing Plan. The plan, summarized in attachment A, restores most of the budget reductions noted above during the three budget years from July 1, 2013 through June 30, Broadly speaking, General Fund expenditures can be divided into three roughly equal parts: employee salaries and benefits, contract with the Napa County Sheriff s Office, and all other services/supplies/debt service. As your finance staff developed recommendations for the coming budget years, we tried to restore and absorb increased expenses in all three categories in a balanced fashion over time. For example, the proposed budget absorbs increases in the Sheriff s contract each year over the three year period; restores furlough days in a phased approach during the first two years; provides increases in other areas, including parks maintenance and equipment replacement; shifts debt service back to the general fund from capital funds in the first two years; and increases OPEB payments over time, most notably in the third year. This is discussed in more detail later in this report. We believe this three-year, balanced approach is prudent and helps protects the City from jumping in too far, too fast. While the economy is stabilizing and in the last few months we have seen home prices increase, the recovery is still early and we should not assume property tax revenues will skyrocket. PERS recently adopted new policies that could significantly increase PERS rates during the year, but the details are still unknown. We are receiving more and more inquiries from potential developers, however, as of yet nothing notable is moving forward. Should the economic recovery stall, the three-year stabilization plan can help ensure that we remain flexible and won t need to implement reductions, again. Budget Review On May 2, 2013 the Finance Committee reviewed the proposed General Fund budget and discussed the proposed three year plan (attachment A). Similar to the SDEP, the new three-year plan projects a small use of General Fund reserves in the first two years of the plan, and a balanced budget in year three. The Plan s use of reserves during the first two years is relatively small and will not harm the fund s overall financial condition. At tonight s meeting, the City Council will review the General Fund, Water Fund, Wastewater Fund and the Affordable Housing fund budgets. These budgets include all salary expenses and typical operational budgets. The remaining

5 special revenue, impact fee and debt service funds represent very limited discretionary spending and will be presented to the Council at the public hearing scheduled for June 4 th. FISCAL IMPACT GENERAL FUND: Revenues - The City s budget has been impacted by the poor economy of past years but fortunately the economy is improving. Property tax and sales tax revenues make up about 60% of total general fund revenues and both are doing better. Sales tax revenues are expected to end this year at $2.25 million, about $190 thousand more than budgeted. In fiscal year , sales tax is expected to increase another $100 thousand to $2.35 million which is about 14% more than was budgeted in the current year. While property taxes did not meet budget expectations this year, they were close and are expected to increase next year. Concurrent with the improving economy, the housing market has been improving, especially the last six months. As prices rise, home sales will produce increased taxes. Additionally, the County Assessor can reassess homes that he previously devalued helping the City recover tax revenues lost during the past few years. Property taxes have been conservatively budgeted at $7.53 million for fiscal year , up about $200 thousand from the current year projected actual revenues. Transient Occupancy Taxes are continuing to perform well. TOT is expected to come in at $1.13 million or $168 thousand greater than the budget this year. For fiscal year , a modest increase to $1.17 million is projected. Finally, as a result of the settlement of the card room tax lawsuit, the City expects to receive $145 thousand this year and $257 thousand including payment of a portion of prior year taxes, in fiscal year Expenditures There are roughly three categories of expenditures in the General Fund as indicated below. 1. Salary and Benefits A. Labor Contract The City and Teamsters have been actively negotiating for a labor agreement effective July 1, 2013, but no agreement has been reached yet. With no final agreement, the last offer on the table was included in the budget for fiscal year The major components were a reduction in unpaid furlough days from 15 to 8 (costing approximately $122 thousand) and an increase in city paid contributions for health insurance by 5%. Also, PERS increased the City s retirement rate 0.9% to 14.9%. In the fiscal year, the budget assumes further reductions in unpaid furloughs from 8 days to 3 days. B. Staffing - As a result of organizational restructuring beginning in fiscal year , the Finance and Human Resources Departments will be combined into an Administrative Services Department. An Administrative Services Director was added while the Finance Director and Human

6 Resources Director positions were eliminated. Additionally, a Management Analyst to perform human resources duties was added. These changes will result in some savings for the City. A second Management Analyst was added to perform Economic Development duties in fiscal year and funding will be shared equally by the General, Water and Wastewater funds. 2. Napa County Law Enforcement Contract The three year fixed price contract that was approved by the Council to help the city control costs ends on June 30, The Sheriff has proposed a new three year fixed price contract with no staffing changes. The contract includes annual price increases so that the County can cover its operating costs. This arrangement provides a measure of certainty regarding the contract price and lead time to the City for planning purposes. The contract price for fiscal year is proposed at $5,329,900 which is a $155 thousand increase or 3% compared to fiscal year Similar increases are included in the planned budget for the subsequent two years. 3. Everything Else A. Debt service Debt service expenses will increase $273 thousand in fiscal year compared to this year. The General Fund must pay half the cost of annual Gym / Aquatic Center debt service payment, $142 thousand, now that the park impact fee fund resources have been otherwise committed or spent. Also, the City used available one-time resources in the debt service fund, about $131 thousand, to pay a portion of the City Hall Building debt this year. This was a one-time use so the General Fund must cover this additional amount in Fiscal Year B. Capital Outlay - Major purchases included in the proposed budget include a complete replacement of the City s wireless network, allowing us to communicate with each other and the world ($35,000) and replacement vehicles for public works ($40,000) and patrol vehicles ($60,000). More notably, we anticipate the acquisition of a new vactor truck for $500,000, to be lease financed over ten years. This is a specialized truck which is primarily used in the cleaning and servicing of sewer mains but is also frequently used to clear storm drains, respond to sewer overflows, and much more. Our current vactor truck was placed in service in July 2002 with a typical service life of ten years. It has been experiencing reliability issues as parts wear out and become more difficult to replace. Moreover, it has two diesel engines and compliance with air quality regulations is becoming more difficult. While there are neighboring agencies with similarly outfitted trucks, it is not practical for American Canyon to rely solely on a borrowed or rented truck as each agency has to be ready at a moment s notice to respond to a sanitary sewer overflow, plus the truck is used frequently throughout the week for many tasks. Nonetheless, before

7 completing the purchase, we will explore all options with our neighboring jurisdictions. Staff proposes to finance the new truck by paying 25% down using Measure A funds and paying the balance over ten years sharing the cost between the General, Water and Wastewater funds. Before this purchase can be made, we will return to the City Council for approval of the financing plan. Because debt payments are paid in arrears, there is no debt service planned for this purchase in C. Other Modest increases in funding for parks maintenance were included for additional staff hours and improved cleaning of the restrooms. The Community Development Budget includes $330 thousand for the PDA Specific Plan and Housing Element update, with $310 thousand of this covered by grants. Other challenges and issues 1. On tonight s agenda, the Council will consider appropriating funds to open Newell Open Space to the public. That request includes the addition of $31,000 to the operating budget to maintain the facility once it is open. These funds are not included in the budget presented tonight, but will be added if so directed. 2. I recently received a request from the Napa Valley Community Foundation for funding of $10,000 over the next three years ($3,330 per year) for their One Napa Valley Initiative (see attachment E for more details). Several other cities in the Valley, including the City of Napa, have agreed to participate in this important effort. This contribution is not included in the proposed budget, but will be added if so directed. 3. Although not included in the proposed budget, I do want to make the Council aware that there is a critical need for an associate planner in the Community Development Department to manage zoning code updates and zoning requests; contract administration for the numerous planning services contracts; development processing support; PDA and grant administration; processing administrative permits; special research projects; census updates, and more. Currently, these efforts are either not completed or completed by the Director, sacrificing other, higher priority efforts. I will be returning to the Council in the coming months to address options for funding such a position, approximately $90 thousand per year. FISCAL IMPACT ENTERPRISE FUNDS: Water Fund - As a result of conservative financial planning, stable revenues which include annual CPI increases and a little luck, the water fund s finances are doing well.

8 Through March 31, 2013, revenues totaled $3.76 million and are projected to end the year at $4.90 million. Expenses are at $3.41 million and projected to be $4.58 million at year end. Not including depreciation, revenues should be about $300 thousand greater than expenses which will become part of the fund s reserves. For fiscal year , revenues are estimated at $4.66 million, just a tick above actual revenues projected for this year. With total revenues budgeted at $5.05 million compared to total expenses of $4.68 million, another $370 will be added to reserves. Note, however, that this fund, similar to the wastewater fund, must continually plan for substantial long-term expansion plans and these increases to reserves are a necessary, and normal, effort to fund these future needs. The proposed budget for salary and benefits would include the proposed changes as noted for the general fund. Also, this budget includes a proposed capital outlay of $105 thousand for a new, secure, chemical storage building. Wastewater Fund Operations and maintenance expenses incurred running the treatment plant and maintaining the collection system are covered by service revenues, which continue to be strengthened by annual CPI increases. Revenues are projected to end the year at $4.13 million, slightly under budget of $4.15 million. Expenses are projected to end the year at $3.67 million, less than the budget of $3.96 million allowing almost $460 thousand to be added to cash reserves. In fiscal year , revenues of $4.33 million are estimated compared to a recommended expense budget of $4.25 million which will add about $86 thousand to reserves. Note, however, that this fund, similar to the water fund, must continually plan for substantial long-term expansion plans and these increases to reserves are a necessary, and normal, effort to fund these future needs. The proposed budget for salary and benefits would include the proposed changes as noted for the general fund. Also, this budget includes a proposed capital outlay of $84 thousand for a various collection system repairs and $100 thousand to replace tanks and other equipment at the WWTP. FISCAL IMPACT AFFORDABLE HOUSING FUND: This fund accounts for fees collected from developers in lieu of providing affordable housing. Revenues have been very low the past few years and fund operations have been paid from revenues collected many years ago. The City contracts with the Napa Housing Authority to provide affordable housing and support services and the Hope Center to provide services to the homeless in the County. The City also contributes to Napa Valley Fair Housing Services to support the elimination of housing discrimination and provide equal housing opportunity for all people through leadership, education, conciliation, outreach, advocacy and enforcement. The City purchased the Valley Vista lots and the house at 189 Theresa Street for its affordable housing program. For fiscal year , the budget recommendation is to continue service efforts at the same level as recent years. No capital expenditures are proposed. The budget

9 recommended for fiscal year spends down the available resources of $605 thousand to $461 thousand. ENVIRONMENTAL DETERMINATION: None COUNCIL PRIORITY PROJECTS AND PROGRAMS: Consideration and adoption of an annual budget is an essential function of the City. This proposed budget includes funding for all the highest priority items identified by the Council for the fiscal year. ALTERNATIVES There are no alternatives to studying the Budget for fiscal year in a special study session. STAFF RECOMMENDATIONS: Receive a Staff Presentation on the Budget for Fiscal Year and direct staff to return on June 4 to conduct a public hearing and adopt the Fiscal Year budget. Attachments: A General Fund 3 Year Budget Stabilization Plan B General Fund Revenues and Expenditure Budget Worksheets C Enterprise Fund Budget Worksheets D Affordable Housing Budget Worksheet E Letter from Terence Mulligan of the Napa Valley Community Foundation

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11 General Fund REVENUE Revenues Budget Worksheet 2% 3 YEAR BUDGET STABILIZATION PLAN Version 4FC PRIOR YEARS CURRENT YEAR 3 YEAR BUDGET NEW YEAR Account Number Description Actual Actual Budget 3/31 Estim Actual FY CITY MANAGERS DEPARTMENT Misc Revenues Other 5,010 11, CITY CLERK 5,010 11, Interfund Transfer In for Support Svcs 124,475 81,700 79,300 59,475 79, , HUMAN RESOURCES 124,475 81,700 79,300 59,475 79, , Misc Revenues Other 39,925 51,620 6,512 6, Interfund Transfer In for Support Svcs 46,300 61,800 58,100 43,575 58,100 63, RISK MANAGEMENT 86, ,420 58,100 50,087 64,600 63,300 CITY MANAGERS DEPARTMENT 215, ,380 # 137, , , ,700 ADMINISTRATIVE SERVICES DEPT Misc Revenues Other 4,128 3,334 3,500 2,255 3,500 3, Interfund Transfer In for Support Svcs 239, , , , , , FINANCE 243, , , , , , Interfund Transfer In for Support Svcs 68,700 74,700 74,000 55,500 74,000 71, INFORMATION SYSTEMS 68,700 74,700 74,000 55,500 74,000 71, Interfund Transfer In for Support Svcs 455, , , , , , UTILITY BILLING 455, , , , , ,100 ADMINISTRATIVE SERVICES DEPT TOTAL 767, ,434 # 857, , , ,100 POLICE/SHERIFF Misc Revenues Other 621 6, , Towing Fees 27,600 32,250 30,000 34,040 40,000 40, Fines and Forfeitures 99, , ,000 65, , , Transfer In from Other Funds / COPS 109, , ,100 3, , ,100 POLICE/SHERIFF DEPT TOTAL 236, , , , , ,200 Page 1 of 6 5/12/2013 6:07 PM

12 General Fund REVENUE Revenues Budget Worksheet 2% 3 YEAR BUDGET STABILIZATION PLAN Version 4FC PRIOR YEARS CURRENT YEAR 3 YEAR BUDGET NEW YEAR Account Number Description Actual Actual Budget 3/31 Estim Actual FY PUBLIC WORKS PUBLIC WORKS ADMINISTRATION Interfund Transfer In for Support Svcs 447, , , , , , PUBLIC WORKS ADMINISTRATION 447, , , , , ,800 CIP ADMINISTRATION Permits Oversize / Weight 3,382 2,902 3,000 1,443 3,000 3, Permits Encroachment 2,334 3,384 5, ,000 5, Misc Revenues Other 50 1, Transfer In from Other Funds 200, , , CAPITAL PROJECTS ADMIN 5,766 6, ,000 2, , , Grants Federal 88,498 15,637 15, Misc Revenues Other 2, Transfer In from Gas Tax 214, , , , , , Transfer In from Measure A/ St Swee 44,025 12,833 15,000 11,163 15,000 25, STREETS & ROADS 260, , , , , , Transfer In from Measure A 217, , , , , , STORM DRAIN/MEASURE A 217, , , , , , Interfund Transfer In for Support Svcs 56,500 66,600 75,600 56,700 75,600 83, FLEET OPERATIONS 56,500 66,600 75,600 56,700 75,600 83, Interfund Transfer In for Support Svcs 69,800 62,400 68,200 51,150 68,200 67, BUILDING MAINTENANCE 69,800 62,400 68,200 51,150 68,200 67, Misc Revenues Other 260 2, ,000 2, Transfer In from Other Funds 28,450 27,685 28,300 28,300 32, PARKS MAINTENANCE 28,710 29,815 28,500 2,000 30,300 32,330 PUBLIC WORKS DEPT TOTAL 1,085,488 1,279,213 1,374, ,383 1,317,400 1,522,430 Page 2 of 6 5/12/2013 6:07 PM

13 General Fund REVENUE Revenues Budget Worksheet 2% 3 YEAR BUDGET STABILIZATION PLAN Version 4FC PRIOR YEARS CURRENT YEAR 3 YEAR BUDGET NEW YEAR Account Number Description Actual Actual Budget 3/31 Estim Actual FY COMMUNITY DEVELOPMENT Permits Home Occ 3,509 3,393 2,000 2,118 2,200 2, Permits Planning 6,335 3,140 3,000 2,686 3,000 3, Plan & Map Check 5,465 6,027 5,000 3,356 5,000 5, Plan Review 234, , Misc Revenues Other 47, , , , PLANNING 62, , , , , ,200 Transfer In from Water Ops 33, Transfer In from Wastewater Ops 33, ECONOMIC DEVELOPMENT 66, Rentals / Leases Other 6,566 59,700 61,500 46,431 61,500 62,700 Mobile Home Rent Stabilization 14,300 14,300 14, HOUSING SERVICES 6,566 59,700 61,500 60,731 75,800 77, Permits Building 167, , , , , , Plan & Map Check 26,176 45,189 30,000 28,259 30,000 30, Misc Revenues Other Fines and Forfeitures 3,900 10,300 5, ,000 5, BUILDING & SAFETY 197, , , , , , Permits Grading 3,974 5, ,000 10, Permits Encroachment 2, Plan Review 171,484 50, Chgs for Servs Other 122, Misc Revenues Other 48,059 2,251 4,000 2,510 4,000 4, CITY ENGINEER 177, ,700 59,500 3,618 5,900 14, Plan Review 200, , , , Chgs for Servs Other 132,760 2,939 3, DEVELOPER PROJECTS 132, , , , ,000 COMMUNITY DEVELOPMENT DEPT TOTAL 576, , , , ,200 1,074,800 Page 3 of 6 5/12/2013 6:07 PM

14 General Fund REVENUE Revenues Budget Worksheet 2% 3 YEAR BUDGET STABILIZATION PLAN Version 4FC PRIOR YEARS CURRENT YEAR 3 YEAR BUDGET NEW YEAR Account Number Description Actual Actual Budget 3/31 Estim Actual FY PARK & RECREATION Contract Classes 116, , ,000 79, , , Trips & Excursions 1, ,500 1,443 2,500 2, Special Event 15,466 9,897 10,000 9,670 10,000 10, Day Camp Fees 16,910 20,150 18,000 11,793 18,000 18, Rentals Community /Sr Ctr 28,078 29,707 29,000 13,832 29,000 29, Rentals Garden 1,340 1,195 1,000 1,025 1,100 2, Rentals / Leases Other 8,286 8,553 8,000 6,643 8,000 3, Contributions & Donations 2,410 3,295 2,000 2,201 2,200 2, Misc Revenues Other 5,971 5,061 3, ,000 3, RECREATION PROGRAMS 196, , , , , , Sports Program 34,925 49,597 45,000 23,492 45,000 55, Rentals Ball Fields , ,500 1, SPORTS PROGRAMS 52,932 50,584 46,500 24,087 46,500 57,400 AQUATICS PROGRAMS Education Instruction 6,642 4,717 2,000 2,168 2,200 2, Swim Team 2,280 2,750 3,000 1,595 3,000 3, Swim Lessons 61,800 65,910 63,000 24,170 63,000 66, Swim Fitness 7,814 5,860 6,000 5,803 6,000 6, Swim Open 10,734 16,575 15,000 11,545 15,000 16, Water Aerobics 7,141 6,002 7,000 4,439 6,500 7, Rentals Aquatic Cntr 1,242 2,513 1,000 1,504 1,600 1, Misc Revenues Other 1, AQUATICS PROGRAMS 98, ,427 97,500 51,224 97, , Rentals Community /Sr Ctr 6,985 5,355 6,000 7,703 9,000 6, SENIOR/MULTI USE CENTER 6,985 5,355 6,000 7,703 9,000 6,100 PARKS AND RECREATION DEPT TOTAL 338, , , , , ,100 Page 4 of 6 5/12/2013 6:07 PM

15 General Fund REVENUE Revenues Budget Worksheet 2% 3 YEAR BUDGET STABILIZATION PLAN Version 4FC PRIOR YEARS CURRENT YEAR 3 YEAR BUDGET NEW YEAR Account Number Description Actual Actual Budget 3/31 Estim Actual FY NON DEPARTMENTAL Property Tax Cur Sec 5,734,828 5,617,507 5,750,000 3,110,729 5,700,000 5,865, Property Tax Cur Unsec 233, , , , , , Supplemental Property Tax 81,744 73,109 31,000 18,701 31,000 31, Prior Year Property Tax 157, , , , , , Homeowner's Exemption 37,486 29,861 34,200 15,345 33,550 34, Prop Tax In Lieu of VLF 1,126,353 1,113,732 1,110, ,059 1,096,100 1,132, Property Transfer Tax 57,286 87,161 52,000 59,929 75,000 53,000 Property Taxes 7,428,639 7,303,932 7,371,600 4,089,904 7,334,050 7,519, Sales & Use Tax 1,492,056 1,533,614 1,566,000 1,051,755 1,686,000 1,779, Sales Tax Triple Flip 473, , , , , ,200 Sales Taxes 1,965,610 2,024,495 2,060,000 1,325,544 2,248,000 2,352, Transient Occupancy Tax 663, , , , ,000 1,020, Tourist Bus Imp Dist Tax 120, , , , , ,000 Transient Occupancy Taxes 784,127 1,089, , ,976 1,130,000 1,170, Business License Tax 117, , , , , , Admissions Tax Cardroom 216, , ,600 Other Taxes 117, , , , , , Franchise Natural Gas 40,935 42,383 45,000 37,600 45, Franchise Electricity 148, , , , , Franchise Cable TV 242, , , , , , Franchise Solid Waste 114, , ,000 78, , ,000 Franchise Taxes 546, , , , , , Motor Vehicle License Fees 79,541 9,743 10,155 10, Mandated Costs (SB90) Reimburseme 11,508 11,400 10,000 4,838 4,838 5,000 Intergovernmental General 91,049 21,143 10,000 14,993 14,993 5,000 Page 5 of 6 5/12/2013 6:07 PM

16 General Fund REVENUE Revenues Budget Worksheet 2% 3 YEAR BUDGET STABILIZATION PLAN Version 4FC PRIOR YEARS CURRENT YEAR 3 YEAR BUDGET NEW YEAR Account Number Description Actual Actual Budget 3/31 Estim Actual FY Business Lic Processing 19,033 23,761 23,000 18,816 23,000 23, Interest 210, , , , , , Lease Cell Tower Sites 51,603 52,367 57,000 39,189 57,000 57, Lease City Hall Offices 48, , ,000 94, , ,000 Rents 100, , , , , , Late Penalties/Interest 3,027 1,490 3,000 16,388 17,000 3, Lease Proceeds Vactor Financing 125, Misc Revenues Other 202, , ,300 93, , , Transfer In from Gas Tax 89, GENERAL FUND 14,690,189 16,013,551 15,589,000 9,401,423 15,703,493 16,875,530 Page 6 of 6 5/12/2013 6:07 PM

17 General Fund Expenditures Budget Worksheet 3 YEAR BUDGET STABILIZATION PLAN PRIOR YEARS CURRENT YEAR General Fund NEW YEAR FY Div Description Actual Actual Budget Bal at 3/31 Estim Actual Bdgt Request City Managers Department 110 City Council $ 167, , ,500 74, ,950 $ 113, City Manager 312, , , , , , City Clerk 280, , , , , , City Attorney 807, , , , , ,600 CM Dept Total 1,567,806 1,047,314 1,018, , , ,950 Administrative Services Department 210 Finance 698, , , , , , Information Systems 354, , , , , , Utility Billing 455, , , , , , Human Resources 368, , , , , , Risk Management 242, , , , , ,600 ASD Total 2,119,295 1,972,868 2,118,510 1,454,951 2,008,500 2,210, Police/Sheriff 310 Police/Sheriff 5,244,796 5,342,689 5,560,830 3,717,157 5,541,730 5,725,600 Public Works Department 510 Public Works Admin 431, , , , , , Capital Projects Admin 248, , , , , , Streets & Roads 659, , , , , , Storm Drain/Meas A 172, , , , , , Fleet Operations 248, , , , , , Building Maintenance 252, , , , , , Parks Maintenance 689, , , , , , PW Dept Total 2,703,259 3,004,882 3,233,711 1,980,808 2,774,750 3,581,050 Page 1 of 2

18 General Fund Expenditures Budget Worksheet 3 YEAR BUDGET STABILIZATION PLAN PRIOR YEARS CURRENT YEAR General Fund NEW YEAR FY Div Description Actual Actual Budget Bal at 3/31 Estim Actual Bdgt Request Public Works Department 610 Planning 374, , , , , , Economic Development 99, , , , , , Housing Services 1,096,521 99,216 40,900 31,268 40,900 41, Building & Safety 424, , , , , , City Engineer 323, , , , , , Developer Projects 92, ,000 31,156 70, , CD Dept Total 2,411,268 1,335,748 1,436, ,080 1,138,400 1,925,600 Parks & Recreation Department 710 Recreation Programs 467, , , , , , Sports Programs 28,238 34,955 49,500 29,461 45,700 56, Aquatics Programs 377, , , , , , Senior/Multi Use Cente 36,082 26,255 55,600 24,150 36,700 51, P&R Dept Total 909, ,128 1,239, ,633 1,157,600 1,245,700 Other Cost Centers 810 Non Departmental 1,068, , , , , , Debt Service 610, , , , , , Other Total 1,679,285 1,238,106 1,212, ,451 1,139,800 1,536,750 GENERAL FUND EXPENDITURE TOTA $ 16,635,659 14,866,736 15,819,286 10,315,429 14,688,930 $ 17,162,150 Page 2 of 2

19 ATTACHMENT C Water Operations Fund Budget Worksheet - Summary Version 4FC PRIOR YEARS CURRENT YEAR NEW YEAR REVENUES FISCAL YEAR FY Div No Description Actual Actual Budget 510 WATER OPERATIONS Actual through 3/31/13 Estimated Actual Bdgt Request 560 WATER TREATMENT PLANT $ 4,732,967 4,743,275 4,787,700 3,763,770 4,904,800 $ 4,926,800 Loan Proceeds - Vactor 125,000 REVENUE TWATER OPERATIONS $ 4,732,967 4,743,275 4,787,700 3,763,770 $ 4,904,800 $ 5,051,800 EXPENSES FISCAL YEAR FY Div No Description 510 WATER OPERATIONS 2011 Actual 2012 Actual Budget Actual through 3/31/13 Estimated Actual Bdgt Request 560 WATER TREATMENT PLANT 2,642,857 2,328,670 2,596,650 2,276,247 2,829,650 $ 3,090, WATER DISTRIBUTION 808, ,764 1,230, ,108 1,113,700 1,047, NON DEPARTMENTAL 283, , , , , , DEBT SERVICE 200, , , , , ,000 EXPENSE TWATER OPERATIONS 3,934,660 3,720,403 4,509,550 3,406,512 4,577,350 - $ 4,677,200 C:\Users\lcollins\Desktop\Water Fund Budget Version 4 Water Summ Page 1 of 1 5/16/2013 1:27 PM

20 Wastewater Operations Fund Budget Worksheet - Summary Version 4FC REVENUES Div No Description Actual Actual Budget PRIOR YEARS CURRENT YEAR NEW YEAR FISCAL YEAR FY Actual through 3/31/13 Estimated Actual Bdgt Request 540 WASTEWATER OPERATIONS 4,015,508 3,967,291 4,154,800 3,148,345 4,127,700 4,206,500 Loan Proceeds - Vactor 125,000 REVENUE WASTEWATER OPNS $ 4,015,508 $ 3,967,291 $ 4,154,800 $ 3,148,345 $ 4,127,700 $ 4,331,500 EXPENSES FISCAL YEAR FY Div No Description 2011 Actual 2012 Actual Budget Actual through 3/31/13 Estimated Actual Bdgt Request 570 TREATMENT PLANT 3,046,698 3,440,794 2,898,132 1,732,539 2,792,120 3,021, COLLECTIONS SYSTEM 212, , , , , , STORM WATER QUALITY 148,196 82, ,965 60,215 97, , SOLID WASTE 77,413 44,410 60,250 31,396 52,000 61, NON DEPARTMENTAL 188, , , , , , DEBT SERVICE 237, , , , , ,500 EXPENSE WASTEWATER OPNS 3,911,710 4,499,953 3,957,246 2,294,363 3,667,820 $ 4,245,400 C:\Users\lcollins\Desktop\Wtwtr Fund Budget Version 4 Wstewtr Summ Page 1 of 1 5/16/2013 1:28 PM

21 ATTACHMENT D 5/16/2013 1:25 PM Affordable Housing Fund Budget Worksheet Fiscal Year Affordable Housing Fund accounts for fees collected from developers in lieu of providing affordable housing services. Version 4 FISCAL YEAR FY Actual Bal Est Actual at FY Proposed Budget 3/31/2013 End 2012 Budget Revenues Interest 2,000 1,275 2,500 2,000 Sale of Property Total Revenues 2,000 1,275 2,500 $ 2,000 Expenditures Personnel Expenses 54,000 33,757 54,000 34,200 Affordable Housing Fund 340 Purchase of Property - Farm Wkr Housing 10,500 Professional Services 109,250 59, , ,250 Hope Center 13,250 Misc Services / Prop Tax - 2,274 2,300 2,300 Housing Authority 65,000 Support Svcs Interfund Trans 4,600 2,850 4,600 Fair Housing 10,500 Total Expenditures 167,850 97, ,900 $ 145,750 Other Maint Svs 10, ,250 Change in Fund Balance * (165,850) (158,400) (143,750) Estimated Beginning Fund Balance 1,316,323 1,316,323 1,157,923 Estimated Ending Fund Balance 1,150,473 1,157,923 1,014,173 Less Unspendable 552,760 Available Resources $ 461,413 * Fund Balance Reserved for Property Held for Resale and not available to spend - $552, Theresa and Valley Vista lots

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25 AMERICAN CANYON FIRE PROTECTION DISTRICT BOARD AGENDA STAFF REPORT SUBJECT: Meeting Date: May 21, 2013 SPECIAL WORKSHOP ITEM: 2 Hold a Workshop to review the Preliminary and Final Annual Operating Budget for the American Canyon Fire Protection District for fiscal year SUBMITTED BY: Glen E. Weeks, Fire Chief Barry Whitley, District Treasurer DISCUSSION: The Fire Protection District s financial condition is good notwithstanding the poor economic conditions of the past few years. To conserve resources, District staff has economized whenever possible. The District met its goals in A firefighter position was added and filled, a new Fire Prevention Services Ordinance and Fee Schedule was adopted, and two major pieces of fire apparatus were replaced for a total of $829,000. Due to grant funds received from the Assistance to Firefighters (AFG) Federal Grant Program, actual cost to the District for apparatus replacement was $564,000. For fiscal year , the District is well positioned to maintain its service levels even in the face of the poor economic conditions and stagnant revenues. The proposed operating budget, while conservative, lays the groundwork for future service enhancements. The Assistant Fire Chief position needs to be filled and the strategic plan updated. Another important goal is to upgrade the level of emergency medical response to advanced life support. During the past few years, the status quo has been maintained for District operations. However, Staff is continuing to evaluate opportunities for greater efficiencies such as collaboration with neighboring agencies as well as seeking cost recovery in order to maintain or enhance current service levels. The Finance Committee reviewed the operating budget as proposed by staff on May 2, The budget proposed this evening is the same as the one presented to the Finance Committee with no amendments.

26 BUDGET: The District s Operations Fund accounts for the day to day expenses of running the Fire Department. Overall, the fund s financial condition is good based on the projected fund balance at June 30, 2013 of $3.3 million. Adequate reserves are available to meet emergencies as the District has been able to continue allocating funds to its contingency, risk and catastrophic reserves and has met the target of 20% of the operating budget for the contingency reserve and the $500,000 target for the catastrophic reserves. The remainder of the fund balance is unassigned and available for future investment in infrastructure and enhanced services. For fiscal year , the District s top revenue source, property taxes, is projected to be $3.035 million; about 3% less than the $3.14 million budgeted. Property taxes represent about 80% of the Operations Fund revenues so they are vital to financing the District s continuing operations. Due to an improving economy including the initial stage of a housing market recovery, staff estimates that property taxes will be about 3% greater in fiscal year compared to the fiscal year The proposed budget for the District s other significant revenue source, fire assessment fees, is $590 thousand for fiscal year These fees are assessed on property owners within the District s boundaries to help maintain adequate fire service levels. Annually, in a separate action, the Board approves these fees which are calculated based on the structure construction type, fire flow area, proximity of other structures, type of occupancy, and the presence of fire prevention devices. This is a reliable and stable source of revenue for the District. The increase in revenues is not due to an increase in the rates but likely from additional building within the District s boundaries. The District recently contracted with Capitol PFG to perform a third party review of the Fire Service Fee Program and results of the review and potential recommendations will be brought to the Board in the near future. The District s Operations Fund total estimated revenue for fiscal year is $4.046 million. Staff is recommending a budget with appropriations set at $4.160 million. Although the FY budget has a small deficit, the long term financial outlook of the District remains good. During FY , staff proposes to fill the Assistant Chief position. The position has been vacant since Oct. 30, A joint powers agreement (JPA) with the City of Napa FD was initiated to save cost while offsetting a portion of the workload of the Assistant Chief. The JPA has been very successful and beneficial for both agencies and staff recommends continuing the collaboration indefinitely along with filling the Assistant Chief position. The majority of the JPA focus is on Fire Prevention (of which a portion is offset by the new prevention fees established) while the Assistant Chief s focus would be on operations,

27 training and assisting the Fire Chief where needed such as with the administration of an Advanced Life Support Program. The operating budget also includes an appropriation of $292,300 for retiree health benefits, and a $50,000 allocation to the apparatus replacement fund. FINANCIAL IMPACT The District s budget has been impacted by the poor economy of past years but fortunately, that is now improving. The District s cost conscious operations and conservative financial planning have enabled the accumulation of an appropriate level of reserves. As a result, there has been little impact on service levels. The improving economy promises to strengthen the Fire District s finances which will help enable it to meet its future goals. The District s reserves will be maintained at the 20% target established by the District s fiscal policy. RECOMMENDATIONS Review recommended FY Fire District operating budget and goals. ACTION REQUESTED Conduct a Work Shop on the District proposed budgets and goals for FY Attachments: Attachment I District Budget

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