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HomeMy WebLinkAboutAgenda Packet - April 20, 2019 - CC OF Q. L4tiroo. ,zusA DECLARATION OF POSTING CITY COUNCIL, SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY, AND PUBLIC FINANCING AUTHORITY AGENDA I, P aAAV '"1')-U declare that: I am an employee of the City of Azusa. On PlaYi 1 i L I posted copies of the Agenda, as stated above for the meeting of ' ' ; a , in the City Clerk's Office, 213 E. Foothill Blvd.; the lobby of the Police Department, 725 N. Alameda Ave.; the Civic Auditorium, 213 E. Foothill Blvd.; the City Library, 729 N. Dalton Ave.; and the and the City's Web Page www.ci.azusa.ca.us. A true, correct and complete copy of the agenda which I posted is attached hereto. I completed posting of the agendas as described in Paragraph two, at ' `` � � on the date of posting. Access to the agenda posted in the lobby of the Police Department and the Azusa City Library reference desk is available to members of the public during their normal business hours. The foregoing is within my personal knowledge and if called as a witness in a court of law, I could testify competently thereto. I declare under penalty of perjury that the forgoing is true and correct. EXECUTED 'rC\VT) , at Azusa, California. STAFF MEMB CITY CLERK'S OFFICE \\\ CITY OF AZUSA APPROVED COUNCIL MEETING Date, a r ►ZUS REPORTS/UPDATES C-1 WHEREAS: Since 1985, Public Service Recognition Week is organized annually by the Public Employee Roundtable, each year the first week of May is recognized as a national event to honor the men and women who serve our nation as federal, state, county and local government employees, the theme chosen for 2015 is Government Works; and WHEREAS: Public employees take not only jobs, but oaths, do amazing things across our great nation, and in our hometown and community, they are the men and women who have taken a variety of challenging rewarding professions in order to serve each of us; and WHEREAS: Throughout the week of May 3-9, 2015, the City of Azusa will celebrate Public Service Recognition Week, to publicly honor all the men and women who dedicate their careers, and sometimes their lives, to keep others safe and provide them with the common needs of our society, they are the ones who work at every level, by providing services, meeting the demands of our community and connecting Citizens with our local Government. NOW THEREFORE the City Council of the City of Azusa proclaims the week of May 3-9, 2015, as PUBLIC SERVICE RECOGNITION WEEK and calls to all residents to recognize the accomplishments and contributions of the 359 Azusa City Employees, who everyday help make the quality of life more pleasant and better for this beautiful community we call home. IN WITNESS WHEREOF we have set our hands and caused the Seal of the City of Azusa to be affixed on this 20th day of April Two Thousand Fifteen. Signed by the Mayor and the City Council APPROVED COUNCIL MEETING Date, 1"i /0 ( I .t-404 AZUSA SCHEDULED ITEM D-1 TO: HONORABLE MAYOR AND COUNCIL MEMBERS VIA: TROY L. BUTZLAFF, ICMA-CM,CITY MANAGER r FROM: SUSAN PARAGAS, DIRECTOR OF FINANCE DATE: APRIL 20, 2015 SUBJECT: ADOPTION OF RESOLUTION APPROVING THE GENERAL FUND RESERVE BALANCE POLICY SUMMARY In order to make prudent decisions related to financial matters, it is critical that the City have sound financial policies in place. Currently, the City does not have a written reserve policy that establishes appropriate levels and uses of General Fund reserves. This action adopts a resolution approving a General Fund Reserve Policy with targeted minimum levels of designated reserves in the General Fund to address unforeseen emergencies, changes in the economic environment and replacement of key capital assets and infrastructure. RECOMMENDATION It is recommended that the City Council take the following action: 1) Adopt Resolution No. 2015-C18 (Exhibit A) adopting and approving a General Fund Reserve Policy. DISCUSSION The City of Azusa does not have a written reserve policy that establishes appropriate levels and guidelines for the use of General Fund reserves. In an effort to evaluate and formalize the City's General Fund Reserve Policy, staff undertook a review of policies adopted by other cities. In addition, recommendations from the Government Finance Officers' Association (GFOA) "best practices in budgeting" were considered in the development of the enclosed draft policy. While specific reserve policy "targets" vary greatly across cities, several elements appear in numerous adopted policies, consistent with best practices and prudent fiscal management. Individual community circumstances and characteristics greatly influence actual reserve level targets; however the following are some of the common themes found in many well-written reserve policies: General Fund Reserve Policy April20,2015 Page 2 • Reserve acts as a"risk management"tool • Reserves provides a"buffer"against revenue fluctuations inherent in economic cycles • Prohibition of use of reserve funds for ongoing operating expenditures • Guidelines for use of reserve funds • Guidelines for replenishment of reserve funds,as needed • Regular review of reserve policy and reserve levels The City needs to set aside funds to address unforeseen emergencies or disasters, significant changes in the economic environment,and key infrastructure and capital projects. Following sound financial practices and adhering to the Government Finance Officers' of American (GFOA) recommendations, the proposed reserve fund policy establishes reserves for known and unknown contingencies,and takes into consideration the following: • Diversity of revenue base • Cyclical nature of revenue • Changes in community priorities • Frequency of budget surpluses/deficits • Cash flow management practices The amount of funds held in reserves varies city to city. A commonly cited standard is five per cent(5.0%) of annual operating expenditures. Others argue that the standard should be anywhere from one month's operating expenditures (roughly 8.3% of budgeted operating expenditures) to three months' expenditures (about 25%). A survey of surrounding cities and their reserve fund levels is attached as Exhibit B. It is recommended that the City set a minimum of 15% of General Fund annual operating expenditures (less one-time expenditures) to reserves using the following reserve categories and allocations: CATEGORY PURPOSE RESERVE LEVEL Catastrophic Reserve To mitigate costs due to 10%of General Fund unforeseen emergencies or Annual Operating catastrophic events. Expenditures(less one-time expenditures). Budget Stabilization Reserve To mitigate annual budget 5% of General Fund Annual revenue shortfalls due to changes Operating Expenditures in economic environment and/or (less one-time one-time expenditures. expenditures). Capital Assets& To use for replacement of capital Equal to estimated City Infrastructure Replacement assets and infrastructure. asset replacement cost after Reserve reserves stated above are met. Should a catastrophic disaster or loss of a significant source of the City's property and sales tax revenue occur, the required reserve level should be adequate to meet the City's immediate financial needs. Likewise, should the City experience a loss of a primary property tax payer or sales tax contributor, the reserve level in the Budget Stabilization Fund would provide for a two- year transition period, giving the City adequate time to realign its operating costs with available resources,while minimizing service impacts. The General Fund Reserve Policy will be reviewed by the City Council as part of the annual operating budget review and adoption process. Appropriations of any General Fund reserves require formal Council authorization. FISCAL IMPACT There is no direct financial impact as a result of the adoption of this item. Prepared by: Susan Paragas Director of Finance Reviewed and Approved: Troy L. Butzlaff, ICMA-CM City Manager Attachments: Exhibit A- Resolution No.2015-C18 Attachment A—General Fund Reserve Policy Exhibit B—Survey of Reserve Fund Levels of Surrounding Cities RESOLUTION NO. 2015-C18 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA ADOPTING AND APPROVING THE GENERAL FUND RESERVE POLICY WHEREAS, the City of Azusa ("City") desires to maintain current and comprehensive financial policies; and WHEREAS, there is a need to formalize the policies regarding General Fund reserves; and WHEREAS,the City desires to adopt a General Fund Reserve Policy (Attachment A); NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF AZUSA DOES HEREBY: Section 1. Approve and adopt the General Fund Reserve Policy attached hereto as Attachment A; Section 2. Authorize City staff to take all actions necessary to carry out the Policy. PASSED, APPROVED and ADOPTED this 20th day of April, 2015. ,r/tv,(414srbal, foseph Romero Rocha Mayor ATTEST: iti/P- Air J f - L.,' ''ceCornejo, Jr City Clerk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution No. 2015-C18 was duly adopted by the City Council of the City of Azusa at a regular meeting thereof, held on the 20` day of April, 2015, by the following vote of Council: AYES: COUNCILMEMBERS: GONZALES, CARRILLO, ALVAREZ, ROCHA NOES: COUNCILMEMBERS: NONE ABSENT: COUNCILMEMBERS: MACIAS ' ri' OPP ...__r f J-ff e .•'s ce Cornejo Jr. / City Clerk APPROVED AS TO FORM: e Marco A. Martinez Best B st & Krieger ' LP City Attorney GENERAL FUND RESERVE POLICY (See Attachment A) ATTACHMENT A • r � # • ........ _. A US CITY OF AZUSA GENERAL FUND RESERVE POLICY POLICY STATEMENT AND PURPOSE: It is the policy of the City of Azusa (City) to establish sound financial policies that are guidelines for prudent decision-making related to financial matters. The purpose of this policy is to establish a target minimum level of designated reserves in the General Fund to: • Reduce the risk of financial impacts resulting from a natural disasters or other catastrophic events; • Respond to the challenges of a changing economic environment, including prolonged downturns in the local, state, or national economy; • Demonstrate continued prudent fiscal management and creditworthiness; and • Provide funding stability for core services and infrastructure funded through the General Fund. BACKGROUND: General Fund reserves are classified into two categories: Restricted and Designated. Restricted reserves are those that are not considered available due to financial, accounting, or legal restrictions. Designated reserves are established by Council policy for an intended purpose and are available for use per Council direction. In addition, the Governmental Accounting Standards Board ("GASB") Statement No. 54 defines five specific classifications of fund balance. The five classifications are intended to identify whether the specific components of fund balance are available for appropriation and are therefore "Spendable." The classifications also are intended to identify the extent to which fund balance is constrained by special restrictions, if any. Al ATTACHMENT A The five classifications are: CLASSIFICATIONS NATURE OF RESTRICTION Non-spendable Cannot be readily converted to cash Restricted Externally imposed restrictions Committed City Council imposed commitment Assigned City Manager assigned purpose/intent Unassigned Residual balance not otherwise restricted Restricted Fund Balance Components: • Non-spendable— resources which cannot be spent because they are either a) not in spendable form or b) legally or contractually required to be maintained intact. • Restricted— resources with constraints placed on the use of resources which are either a) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or b) imposed by law through constitutional provisions or enabling legislation. Unrestricted Fund Balance Components: • Committed— resources which are subject to limitations the government imposes upon itself at its highest level of design making (City Council) and that remain binding unless removed in the same manner. • Assigned— resources neither restricted nor committed for which a government has a stated intended use as established by the City Council or a body or official (management) to which the City Council has delegated the authority to assign amounts for specific purposes. • Unassigned— resources which cannot be properly classified in one of the other four categories. The General Fund should be the only fund that reports a positive unassigned fund balance amount. GUIDING PRINCIPLES: Following sound financial practices and adhering to the Government Finance Officers' of American (GFOA) recommendations, the City's designated reserves include reserves for known and unknown contingencies, which take into consideration the: A2 ATTACHMENT A • Diversity of revenue base • Cyclical nature of revenue • Changes in community priorities • Frequency of budget surpluses/deficits • Cash flow management practices POLICY: Reserve Levels The City will set aside funds into three (3) designated reserves to address unforeseen emergencies or disasters, significant changes in the economic environment, and key infrastructure and capital projects. These include the Catastrophic Reserve, Budget Stabilization Reserve, and Capital Assets and Infrastructure Replacement Reserve. The City commits to maintaining these reserves at a minimum of 15% of General Fund annual operating expenditures (minus one-time expenditures), divided between the Catastrophic Reserve (10%) and Budget Stabilization Reserve (5%), excluding the Capital Assets and Infrastructure Replacement Reserve. The General Fund Reserve Policy is reviewed by the City Council as part of the annual operating budget review and adoption process. Appropriations of any General Fund reserves require formal Council authorization. Should a catastrophic disaster or loss of a significant source of the City's property and sales tax revenue occur, the required reserve level should be adequate to meet the City's immediate financial needs. For example, in the event of natural disaster, the Catastrophic Reserve would provide necessary coverage for basic operating expenses for approximately 90 days, including salary and benefits for safety and non-safety City employees, while still meeting debt service obligations. This time frame would enable the City to explore other available cash alternatives. Likewise, should the City experience a loss of a primary property tax payer or sales tax contributor, the reserve level in the Budget Stabilization Fund would provide for a two-year transition period, giving the City adequate time to realign its operating costs with available resources, while minimizing service impacts. Key General Fund Designated Reserves Catastrophic Reserve. Funds reserved under this category shall be used to mitigate costs associated with unforeseen emergencies, including natural disasters or catastrophic events. Should unforeseen and unavoidable events occur that require the expenditure of City resources beyond those provided for in the annual budget, the City Manager or designee shall have authority to approve Catastrophic Reserve appropriations. The City Manager or designee shall then present to the City Council a A3 ATTACHMENT A budget amendment confirming the nature of the emergency and authorizing the appropriation of reserve funds. Budget Stabilization Reserve. Funds reserved under this category shall be used to mitigate, should they occur, annual budget revenue shortfalls (actual revenues less than projected revenues) due to changes in the economic environment and/or one-time expenditures that will result in future efficiencies and/or budgetary savings. Examples of"economic triggers" and one-time uses include, but are not limited to: • Significant decrease in property or sales tax, or other economically sensitive revenues; • Loss of businesses considered to be significant sales tax generators; • Reductions in revenue due to actions by the state/federal government; • Workflow/technical system improvements to reduce ongoing, personnel costs and enhance customer service; • One-time maintenance of service levels due to significant economic/budget constraints; and • One-time transitional costs associated with organizational restructuring to secure long-term personnel cost savings. Capital Assets and Infrastructure Replacement Reserve. The City will maintain a Reserve for Capital Assets and Infrastructure Replacement. After allocating General Fund balance to the Budget Stabilization Reserve and City Council designated projects and purposes, any remaining fund balance shall be apportioned to the Reserve for Capital Assets and Infrastructure Repair and Replacement as follows: 60% to Streets and 40% to Other Capital Assets and Infrastructure. It is the long-term goal of the City to build and maintain this reserve in an amount equal to the estimated replacement cost of all City capital assets at the end of their design life and to use this reserve for such replacement. Replenishment of Unreserved Fund Balance In keeping with the principles discussed in this policy, when either fund is used, City Council will develop a one (1) to five (5) year reserve replenishment plan to meet the minimum threshold of 15% of General Fund ongoing, operating expenditures, excluding one-time expenditures. Excess Fund Balance At the end of each fiscal year, the Finance Department reports on the audited year-end budgetary fiscal results. Should actual General Fund revenues exceed expenditures and encumbrances, a year-end operating surplus shall be reported. Any year-end surplus that results in the General Fund fund balance exceeding the level required by the reserve policy shall be available for allocation for the following, subject to Council approval: A4 ATTACHMENT A • Offset projected future deficits ■ Anticipated intergovernmental fiscal impacts ■ One-time funding, non-recurring needs ■ Loan repayment acceleration Upon funding of the above, any remaining surplus balances shall be divided equally between the Budget Stabilization Reserve and Capital Assets and Infrastructure Replacement for appropriation. A5 EXHIBIT "B" General Fund Reserve Fund Balance Survey -as of March 22,2015 City General Fund Reserve Policy Alhambra 10% Could not find details Baldwin Park 10% -Emergency Brea 8% Could not find details Covina 20% -No specifics;Excess reserves for nonrecurring activities or capital improvements El Monte $5,000,000 -Working capital 15% -Cash flow requirements,unforeseen operating or capital needs,economic uncertainties, disasters,economic downturns Glendora 45% -Working capital; Excess reserves for capital improvement Irwindale $5,000,000 -Economic uncertainties La Puente 15% -Contingency reserve for unanticipated expenses of non-recurring nature or for unexpected cost increases Monrovia 20% -Economic uncertainties Temple City $1,000,000 -Emergency/Disaster $2,000,000 -Liquidity $500,000 -Econ Uncertainty Upland 10% -Econ uncertainties and unforeseen expenses Walnut 10% -Emergency 0.50% -Council Contingency $45,000 -CM Contingency(2-year period) West Covina 20% -Emergency Whittier 5% -Emergency Sources: California Society of Municipal Finance Officers(CSMFO)Surveys and Cities'websites ltkAoli ck /1 ,. `(b p \ r , ��7711RRllEE��"If .ti„b<, bx�,.4a'" �" ,., �,u a.. . .v,, cu...,w_. ,.„ t ,. .._ ,,.2.,✓.r.,MG,...v.. aS.L�.....,„. .....w%,,, ,<_.. v i° itZUSJJ SCHEDULED ITEM D-2 TO: HONORABLE MAYOR AND COUNCIL MEMBERS VIA: TROY L. BUTZLAFF, ICMA-CM, CITY MANAGER FROM: SUSAN PARAGAS, DIRECTOR OF FINANCE DATE: APRIL 6, 2015 SUBJECT: ADOPTION OF RESOLUTION APPROVING THE GENERAL FUND RESERVE BALANCE POLICY SUMMARY In order to make prudent decisions related to financial matters, it is critical that the City have sound financial policies in place. Currently, the City does not have a written reserve policy that establishes appropriate levels and uses of General Fund reserves. This action adopts a resolution approving a General Fund Reserve Policy with targeted minimum levels of designated reserves in the General Fund to address unforeseen emergencies, changes in the economic environment and replacement of key capital assets and infrastructure. RECOMMENDATION It is recommended that the City Council take the following action: 1) Adopt Resolution No. 2015-C16 (Exhibit A) adopting and approving a General Fund Reserve Policy. DISCUSSION The City of Azusa does not have a written reserve policy that establishes appropriate levels and guidelines for the use of General Fund reserves. In an effort to evaluate and formalize the City's General Fund Reserve Policy, staff undertook a review of policies adopted by other cities. In addition, recommendations from the Government Finance Officers' Association (GFOA) "best practices in budgeting" were considered in the development of the enclosed draft policy. While specific reserve policy "targets" vary greatly across cities, several elements appear in numerous adopted policies, consistent with best practices and prudent fiscal management. Individual community circumstances and characteristics greatly influence actual reserve level targets; however the following are some of the common themes found in many well-written reserve policies: General Fund Reserve Policy March 16, 2015 Page 2 • Reserve acts as a"risk management"tool • Reserves provides a"buffer"against revenue fluctuations inherent in economic cycles • Prohibition of use of reserve funds for ongoing operating expenditures • Guidelines for use of reserve funds • Guidelines for replenishment of reserve funds, as needed • Regular review of reserve policy and reserve levels The City needs to set aside funds to address unforeseen emergencies or disasters, significant changes in the economic environment,and key infrastructure and capital projects. Following sound financial practices and adhering to the Government Finance Officers' of American (GFOA) recommendations, the proposed reserve fund policy establishes reserves for known and unknown contingencies,and takes into consideration the following: • Diversity of revenue base • Cyclical nature of revenue • Changes in community priorities • Frequency of budget surpluses/deficits • Cash flow management practices The amount of funds held in reserves varies city to city. A commonly cited standard is five per cent (5%) of annual operating expenditures. Others argue that the standard should be anywhere from one month's operating expenditures (roughly 8.3% of budgeted operating expenditures) to three months' expenditures (about 25%). A survey of surrounding cities and their reserve fund levels is attached as Exhibit B. Based on this survey the average reserve fund level is 17%. It is recommended that the City set a minimum of 15% of General Fund annual operating expenditures (less one-time expenditures)to reserves using the following reserve categories and allocations: CATEGORY PURPOSE RESERVE LEVEL Catastrophic Reserve To mitigate costs due to 10%of General Fund unforeseen emergencies or Annual Operating catastrophic events. Expenditures(less one-time expenditures). Budget Stabilization Reserve To mitigate annual budget 5% of General Fund Annual revenue shortfalls due to changes Operating Expenditures in economic environment and/or (less one-time one-time expenditures. expenditures). Capital Assets& To use for replacement of capital Equal to estimated City Infrastructure Replacement assets and infrastructure. asset replacement cost after Reserve reserves stated above are met. Should a catastrophic disaster or loss of a significant source of the City's property and sales tax revenue occur, the required reserve level should be adequate to meet the City's immediate financial needs. Likewise, should the City experience a loss of a primary property tax payer or sales tax contributor, the reserve level in the Budget Stabilization Fund would provide for a two- year transition period, giving the City adequate time to realign its operating costs with available resources,while minimizing service impacts. The General Fund Reserve Policy will be reviewed by the City Council as part of the annual operating budget review and adoption process. Appropriations of any General Fund reserves require formal Council authorization. FISCAL IMPACT There is no direct financial impact as a result of the adoption of this item. Prepared by: Susan Paragas Director of Finance Reviewed and Approved: Troy L. Butzlaff,ICMA-CM City Manager Attachments: Exhibit A-Resolution No.2015-C15 Exhibit B—Survey of Reserve Fund Levels of Surrounding Cities EXHIBIT A RESOLUTION NO. 2015-C16 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA ADOPTING AND APPROVING THE GENERAL FUND RESERVE POLICY WHEREAS, the City of Azusa ("City") desires to maintain current and comprehensive financial policies;and WHEREAS,there is a need to formalize the policies regarding General Fund reserves;and WHEREAS,the City desires to adopt a General Fund Reserve Policy; NOW,THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF AZUSA DOES HEREBY: Section 1. Approve and adopt the General Fund Reserve Policy attached hereto as Attachment A; Section 2. Authorize City staff to take all actions necessary to carry out the Policy. ADOPTED AND APPROVED this 6th day of April 2015. JOSEPH ROMERO ROCHA,MAYOR I HEREBY CERTIFY that the foregoing Resolution No. 2015-C15 was duly adopted by the City Council of the City of Azusa at a regular meeting thereof on the 6th day of April 2015,by the following vote of City Council Members. AYES: COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSTAIN: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS; JEFFREY LAWRENCE CORNEJO,JR.,CITY CLERK EXHIBIT B General Fund Reserve Fund Balance Survey -as of March 22,2015 City General Fund Reserve Policy Alhambra 10% Could not find details Baldwin Park 10% -Emergency Brea 8% Could not find details Covina 20% -No specifics; Excess reserves for nonrecurring activities or capital improvements El Monte $5,000,000 -Working capital 15% -Cash flow requirements,unforeseen operating or capital needs,economic uncertainties, disasters,economic downturns Glendora 45% -Working capital; Excess reserves for capital improvement Irwindale $5,000,000 -Economic uncertainties La Puente 15% -Contingency reserve for unanticipated expenses of non-recurring nature or for unexpected cost increases Monrovia 20% -Economic uncertainties Temple City $1,000,000 -Emergency/Disaster $2,000,000 -Liquidity $500,000 -Econ Uncertainty Upland 10% -Econ uncertainties and unforeseen expenses Walnut 10% -Emergency 0.50% -Council Contingency $45,000 -CM Contingency(2-year period) West Covina 20% -Emergency Whittier 5% -Emergency Sources: California Society of Municipal Finance Officers(CSMFO)Surveys and Cities'websites Item D-2 ATTACHMENT A euu_n;.crmr.;x;m;;E4 ffi,*111,01110P4i A = ry / F Zr �,x'sRifiefR€: CITY OF AZUSA GENERAL FUND RESERVE POLICY POLICY STATEMENT AND PURPOSE: It is the policy of the City of Azusa (City) to establish sound financial policies that are guidelines for prudent decision-making related to financial matters. The purpose of this policy is to establish a target minimum level of designated reserves in the General Fund to: • Reduce the risk of financial impacts resulting from a natural disasters or other catastrophic events; • Respond to the challenges of a changing economic environment, including prolonged downturns in the local, state, or national economy; • Demonstrate continued prudent fiscal management and creditworthiness; and • Provide funding stability for core services and infrastructure funded through the General Fund. BACKGROUND: General Fund reserves are classified into two categories: Restricted and Designated. Restricted reserves are those that are not considered available due to financial, accounting, or legal restrictions. Designated reserves are established by Council policy for an intended purpose and are available for use per Council direction. In addition, the Governmental Accounting Standards Board ("GASB") Statement No. 54 defines five specific classifications of fund balance. The five classifications are intended to identify whether the specific components of fund balance are available for appropriation and are therefore "Spendable." The classifications also are intended to identify the extent to which fund balance is constrained by special restrictions, if any. Al ATTACHMENT A The five classifications are: CLASSIFICATIONS NATURE OF RESTRICTION Non-spendable Cannot be readily converted to cash Restricted Externally imposed restrictions Committed City Council imposed commitment Assigned City Manager assigned purpose/intent Unassigned Residual balance not otherwise restricted Restricted Fund Balance Components: • Non-spendable — resources which cannot be spent because they are either a) not in spendable form or b) legally or contractually required to be maintained intact. • Restricted— resources with constraints placed on the use of resources which are either a) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or b) imposed by law through constitutional provisions or enabling legislation. Unrestricted Fund Balance Components: • Committed— resources which are subject to limitations the government imposes upon itself at its highest level of design making (City Council) and that remain binding unless removed in the same manner. • Assigned— resources neither restricted nor committed for which a government has a stated intended use as established by the City Council or a body or official (management) to which the City Council has delegated the authority to assign amounts for specific purposes. • Unassigned— resources which cannot be properly classified in one of the other four categories. The General Fund should be the only fund that reports a positive unassigned fund balance amount. GUIDING PRINCIPLES: Following sound financial practices and adhering to the Government Finance Officers' of American (GFOA) recommendations, the City's designated reserves include reserves for known and unknown contingencies, which take into consideration the: A2 ATTACHMENT A • Diversity of revenue base • Cyclical nature of revenue • Changes in community priorities • Frequency of budget surpluses/deficits • Cash flow management practices POLICY: Reserve Levels The City will set aside funds into three (3) designated reserves to address unforeseen emergencies or disasters, significant changes in the economic environment, and key infrastructure and capital projects. These include the Catastrophic Reserve, Budget Stabilization Reserve, and Capital Assets and Infrastructure Replacement Reserve. The City commits to maintaining these reserves at a minimum of 15% of General Fund annual operating expenditures (minus one-time expenditures), divided between the Catastrophic Reserve (10%) and Budget Stabilization Reserve (5%), excluding the Capital Assets and Infrastructure Replacement Reserve. The General Fund Reserve Policy is reviewed by the City Council as part of the annual operating budget review and adoption process. Appropriations of any General Fund reserves require formal Council authorization. Should a catastrophic disaster or loss of a significant source of the City's property and sales tax revenue occur, the required reserve level should be adequate to meet the City's immediate financial needs. For example, in the event of natural disaster, the Catastrophic Reserve would provide necessary coverage for basic operating expenses for approximately 90 days, including salary and benefits for safety and non-safety City employees, while still meeting debt service obligations. This time frame would enable the City to explore other available cash alternatives. Likewise, should the City experience a loss of a primary property tax payer or sales tax contributor, the reserve level in the Budget Stabilization Fund would provide for a two-year transition period, giving the City adequate time to realign its operating costs with available resources, while minimizing service impacts. Key General Fund Designated Reserves Catastrophic Reserve. Funds reserved under this category shall be used to mitigate costs associated with unforeseen emergencies, including natural disasters or catastrophic events. Should unforeseen and unavoidable events occur that require the expenditure of City resources beyond those provided for in the annual budget, the City Manager or designee shall have authority to approve Catastrophic Reserve appropriations. The City Manager or designee shall then present to the City Council a A3 ATTACHMENT A budget amendment confirming the nature of the emergency and authorizing the appropriation of reserve funds. Budget Stabilization Reserve. Funds reserved under this category shall be used to mitigate, should they occur, annual budget revenue shortfalls (actual revenues less than projected revenues) due to changes in the economic environment and/or one-time expenditures that will result in future efficiencies and/or budgetary savings. Examples of"economic triggers" and one-time uses include, but are not limited to: • Significant decrease in property or sales tax, or other economically sensitive revenues; • Loss of businesses considered to be significant sales tax generators; • Reductions in revenue due to actions by the state/federal government; • Workflow/technical system improvements to reduce ongoing, personnel costs and enhance customer service; • One-time maintenance of service levels due to significant economic/budget constraints; and • One-time transitional costs associated with organizational restructuring to secure long-term personnel cost savings. Capital Assets and Infrastructure Replacement Reserve. The City will maintain a Reserve for Capital Assets and Infrastructure Replacement. After allocating General Fund balance to the Budget Stabilization Reserve and City Council designated projects and purposes, any remaining fund balance shall be apportioned to the Reserve for Capital Assets and Infrastructure Repair and Replacement as follows: 60% to Streets and 40% to Other Capital Assets and Infrastructure. It is the long-term goal of the City to build and maintain this reserve in an amount equal to the estimated replacement cost of all City capital assets at the end of their design life and to use this reserve for such replacement. Replenishment of Unreserved Fund Balance In keeping with the principles discussed in this policy, when either fund is used, City Council will develop a one (1) to five (5) year reserve replenishment plan to meet the minimum threshold of 15% of General Fund ongoing, operating expenditures, excluding one-time expenditures. Excess Fund Balance At the end of each fiscal year, the Finance Department reports on the audited year-end budgetary fiscal results. Should actual General Fund revenues exceed expenditures and encumbrances, a year-end operating surplus shall be reported. Any year-end surplus that results in the General Fund fund balance exceeding the level required by the reserve policy shall be available for allocation for the following, subject to Council approval: A4 ATTACHMENT A ■ Offset projected future deficits ■ Anticipated intergovernmental fiscal impacts ■ One-time funding, non-recurring needs ■ Loan repayment acceleration Upon funding of the above, any remaining surplus balances shall be divided equally between the Budget Stabilization Reserve and Capital Assets and Infrastructure Replacement for appropriation. A5 APPROVED COUNCIL MEETING Date, A.-124),( 1' #i r 40-01.74. iti ZUS , CONSENT ITEM E-6 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: DANIEL BOBADILLA, P.E., INTERIM PUBLIC WORKS DIRECTOR/CITY ENGINEER VIA: TROY L. BUTZLAFF, ICMA-CM, CITY MANAGER DATE: APRIL 20, 2015 SUBJECT: INSTALLATION OF STOP CONTROL AT TENTH STREET/DALTON AVENUE AND ELLIOTT AVENUE/MASON STREET SUMMARY The intersections of Tenth Street/Dalton Avenue and Elliott Avenue/Mason Street were analyzed to determine if stop control was warranted. The analyses concluded that stop signs were warranted at both directions. The proposed actions will approve installation of stop signs at both intersections. RECOMMENDATION It is recommended that the City Council take the following actions: 1. Approve the installation of stop control at Tenth Street and Dalton Avenue. 2. Approve the installation of stop control at Elliott Avenue and Mason Street. DISCUSSION The installation of a new stop sign requires the satisfaction of certain requirements, or warrants, set by the California Manual of Uniform Traffic Control Devices (CA-MUTCD). Warrant analyses were conducted to determine whether the required warrants were satisfied for the intersections at Tenth Street/Dalton Avenue and Elliott Avenue/Mason Street. Stop signs may be installed if a minimum of one of the following warrants required under CA-MUTCD are satisfied: • Minimum traffic volume on street approaches to the intersection • Minimum volume of pedestrians crossing at the intersection • Speed of traffic through the intersection • Number of accidents at the intersection • Potential sight obstructions at the intersection The intersection of Tenth Street and Dalton Avenue is currently controlled by stop signs in the north and south direction, with no control in the east and west direction. A stop sign warrant analysis was conducted at the intersection to determine if stop control in all directions was warranted. The warrant study concluded that stop control in all directions is warranted. The intersection of Elliott Avenue and Mason Street is currently controlled by yield signs in the north and south direction, with no stop control in any direction. During a visual inspection of the intersection, it was determined that sight obstructions exist due to the intersection's curve alignment. As a result, replacement of the existing yield signs with stop signs is warranted. Installation of the proposed stop signs will mitigate sight distance restrictions, meet driver expectations in the area, and generally provide a higher level of vehicle and pedestrian safety. ENVIRONMENTAL CLEARANCE This action is exempt from the requirements of the California Environmental Quality Act(CEQA) pursuant to Sections 15301 (Existing Structures) and 15302 (Replacement or Reconstruction) of the State of California CEQA Guidelines. Staff is directed to file a Notice of Exemption with the Los Angeles County Clerk's Office upon project approval. FISCAL IMPACT The proposed stop signs and legends will cost approximately $1,000 per intersection. Funds are available in the Street Maintenance budget. Prepared by: Daniel Bobadilla Interim Director of Public Works/City Engineer Reviewed and Approved: Troy L. Butzlaff, ICMA-CM City Manager Attachments: 1. Stop Sign Warrant Analysis— Tenth Street and Dalton Avenue 2. Exhibit A —Proposed Four-Way Stop Sign Installation at Tenth Street and Dalton Avenue 3. Exhibit B—Proposed Two-Way Stop Sign Installation at Elliott Avenue and Mason Street MULTI-WAY STOP EVALUATION CITY OF AZUSA Location: Dalton Avenue and 10th Street Date of Count: February 25, 2015 WARRANT STUDY Count Warrants Met? A. Temporary measure in lieu of traffic signal installation Not Studied B.Correctible Collisions: 5 or more correctible collisions in a 12 month period.Number of correctible collisions 1 No occuring between January 1,2011 and December 31,2011 C.Minimum Volumes: 1.The vehicular volume entering the intersection from the major approaches(total of both)averages at least 300 52 No vehicles per hour for any 8 hours of an average day,and 2.The combined vehicular,pedestrian and bicycle volume entering the intersection from the minor street approaches (total of both)averages at least 200 units per hour for the same 8 hours,with an average delay to minor-street 78 No vehicular traffic of at least 30 seconds per vehicle during the highest hour,but 3.When the 85th-percentile approach speed of the major-street traffic exceeds 65 km/h(40 mph),the minimum N/A No vehicular volume warrants are 70 percent of the above values. (210/140) 85th percentile speed:25 MPH D. Where no single criterion is satisfied,but where Criteria B,C.1,and C.2 are all satisfied to 80 percent of the 1 /52/78 No minimum values. (4/240/160) Criterion C.3 is excluded from this condition. Installation of an all-way stop is Recommendation: recommended for consideration at this time. By: Monae Pugh/Terry Renner Date: 3/3/2015 See Attached E&TS Worksheet For TKE Engineering Additional Factors. Engineering and Traffic Study Multi-Way Stop Control Dalton Avenue and 10th Street Dalton Avenue (NB/SB) is a 44'residential roadway which functions as a collector. Posted 25 m.p.h. 10th Street(EB/WB)is a local/residential roadway. Stop Signs control this movement. Posted 25 m.p.h. Crosswalks are marked on all four legs of intersection. School Pedestrian Warning signs exist at the intersection on Dalton Ave. There are no advance warning signs. Dalton Elementary School has established 10th Street at Dalton Avenue as a"walking stop" in the Walking School Bus exercise thereby designating 10th Street as the east/west safe route to the campus(October 2014). As one of two routes in this program coupled with a 50%walking population,this route carries approximately 160 walking/bicycling students daily. There is no crossing guard at this location. Sight Distance is limited/restricted looking NB due to high parking demand on Dalton Ave. for WB vehicles entering intersection. Adjacent intersections in the area predominately are controlled by multi-stop controls. The intersection volumes and collision history does not meet minimum criteria for all- way stop installation. Recommendations CA MUTCD provides general guidelines for all-way stop installation which quantifies volumes and collisions coupled with engineering judgment. Based on the above; all-way stop installation for this intersection will mitigate sight distance restrictions,meet driver expectation in the area, and generally provide a higher level of vehicle and school age pedestrian safety. All-way stop installation is recommended for consideration. In lieu of all-way stop installation,existing School Pedestrian Warning signs on Dalton Ave. should be upgraded to include advance warning signs in compliance with CA MUTCD. Counts Unlimited, Inc Page 1 City of Azusa PO Box 1178 N/S:Dalton Avenue Corona,CA 92878 ENV:10th Street Phone:951-268-6268 AZ0002EW 24 Hour Entering Volume Count email:counts@countsunlimited.com Site Code:999-15091 Start 25-Feb-15 Eastbound Hour Totals Westbound Hour Totals Combined Totals Time Wed Moming Afternoon Morning Afternoon Morning Afternoon Moming Afternoon Morning Afternoon 12:00 0 1 1 1 12:15 1 5 0 3 12:30 0 4 0 0 12:45 0 7 1 17 0 4 1 8 2 25 01:00 0 6 0 12 01:15 0 12 0 5 01:30 1 4 1 6 01:45 0 10 1 32 0 9 1 32 2 64 02:00 0 11 0 17 02:15 1 6 0 9 02:30 1 5 1 7 02:45 0 4 2 26 0 5 1 38 3 64 03:00 0 2 0 15 03:15 0 6 0 7 03:30 0 12 0 6 03:45 0 3 0 23 2 2 2 30 2 53 04:00 0 9 1 6 04:15 2 6 1 5 04:30 2 10 0 3 04:45 0 15 4 40 0 8 2 22 6 62 05:00 1 8 1 7 05:15 0 10 1 5 05:30 3 4 2 7 05:45 2 7 6 29 2 10 6 29 12 58 06:00 1 3 5 5 06:15 0 5 1 0 06:30 2 9 4 2 06:45 6 4 9 21 5 2 15 9 24 30 07:00 2 1 3 4 07:15 12 7 14 2 07:30 13 4 13 2 07:45 18 4 45 16 21 3 51 11 96 27 08:00 6 5 7 1 08:15 1 2 6 3 08:30 1 4 3 1 08:45 2 3 10 14 6 0 22 5 32 19 09:00 5 3 5 0 09:15 5 0 2 0 09:30 3 3 1 0 09:45 2 2 15 8 5 3 13 3 28 11 10:00 4 1 4 3 10:15 4 4 5 0 10:30 5 0 1 1 10:45 5 0 18 5 8 1 18 5 36 10 11:00 4 0 6 0 11:15 4 0 4 0 11:30 3 0 4 0 . 11:45 4 2 15 2 2 0 16 0 31 Total 126 233 126 233 148 192 148 192 274 425 Combined 359 359 340 340 699 Total AM Peak - 07:15 - - - 07:15 - - - - - Vol. - 49 - - - 55 - - - - - P.H.F. 0.681 0.655 PM Peak - - 04:30 - - - 01:45 - - - - Vol. - - 43 - - - 42 - - - - P.H.F. 0.717 0.618 Percentag 35.1% 64.9% 43.5% 56.5% e ADT/AADT ADT 699 AADT 699 Counts Unlimited, Inc Page 1 City of Azusa PO Box 1178 NIS:Dalton Avenue Corona,CA 92878 E/W:10th Street Phone:951-268-6268 AZU002NS 24 Hour Entering Volume Count email:counts@countsunlimited.com Site Code:999-15091 Start 25-Feb-15 Northbound Hour Totals Southbound Hour Totals Combined Totals Time Wed Morning Afternoon Morning Afternoon Morning Afternoon Morning Afternoon Morning Afternoon__ 12:00 12 9 0 1 12:15 5 4 1 3 12:30 6 7 0 4 12:45 5 10 28 30 0 0 1 8 29 38 01:00 4 8 0 3 01:15 5 10 0 1 01:30 1 12 0 1 01:45 7 6 17 36 0 2 0 7 17 43 02:00 1 14 0 3 02:15 2 7 0 1 02:30 2 12 0 1 02:45 2 11 7 44 0 1 0 6 7 50 03:00 0 4 1 3 03:15 3 10 0 4 03:30 2 12 0 3 03:45 0 13 5 39 1 3 2 13 7 52 04:00 2 10 0 1 04:15 2 14 1 4 04:30 0 12 3 3 04:45 2 13 6 49 0 3 4 11 10 60 05:00 5 6 1 6 05:15 6 10 1 5 05:30 4 7 1 5 05:45 6 11 21 34 1 6 4 22 25 56 06:00 6 14 2 3 06:15 3 7 1 4 06:30 4 9 3 5 06:45 3 9 16 39 4 3 10 15 26 54 07:00 9 6 4 0 07:15 2 4 8 0 07:30 7 4 5 0 07:45 13 6 31 20 4 1 21 1 52 21 08:00 12 5 2 1 08:15 7 11 4 1 08:30 4 8 3 0 08:45 3 8 26 32 2 2 11 4 37 36 09:00 8 11 3 2 09:15 3 3 3 0 09:30 5 4 6 1 09:45 13 3 29 21 4 2 16 5 45 26 10:00 4 5 1 0 10:15 7 2 2 1 10:30 2 5 2 1 10:45 3 0 16 12 1 0 6 2 22 14 11:00 9 7 2 1 11:15 6 10 2 0 11:30 10 13 2 0 11:45 4 6 29 36 2 0 8 37 37 Total 231 392 231 392 83 95 83 95 314 487 Combined 623 623 178 178 801 Total AM Peak - 07:30 - - 06:45 - - - - - - Vol. - 39 - - 21 - - - - - - P.H.F. 0.750 0.656 PM Peak - 03:30 - - - 05:00 - - - - - Vol. - - 49 22 -- P.H.F. 0.875 0.917 Percentag 37.1% 62.9% 46.6% 53.4% e ADT/AADT ADT 801 AADT 801 ��. Cal �., r` i e .Q ir t� .: .r, , LE: Y SCAINJCH•OOR Y r_ — ..- .i • a_, ! t M Iii, dOLS a TENTH STREET B liI R U. I 3 , a a STOP ON I IIII ., UNI i 24." 1 W 1 ..r at LEGEND Z O <, •• lIOPOMpMA :F MIN OMNI R14 MEM 11 J Q STOP wKoPoroaOPLIMO �.- I UMW EXHIBIT"A" DATE: 03/30/15 PROPOSED FOUR-WAY STOP SIGN INSTALLATION REVIEWED BY: C.C. DALTON AVENUE.TENTH STREET PREPARED BY: P.F. CITY OF AZUSA APPROVED BY: D.B. ENGINEERING DMSION i 1 Ind I r wLbs I 4, MASON STREET ',- .' 1 w STOP ,,,„.7 . 1 1 . . - . . 1 40. —41111.4404. 44114414 .,. a "u".".".." a '� ., V,"4 , u 4ft Z LEGEND r Q * .d ,,,,, r .;..F,, . ito .. amwitu ®ar roaaraa -STOP Immo mai moo '- /.1' PROPCMODUITLNI LU • y w .. . EXHIBIT"B" DATE: 03/30/15 PROPOSED FOUR-WAY STOP SIGN INSTALLATION REVIEWED BY: C.C. ELLIOTT AVENUE fa MASON STREET PREPARED BY: P.F. CITY OF AZUSA APPROVED BY: D.B. ENGINEERING DIVISION APPROVED COUNCIL MEETING Date, ,p 4:f atiii;41 AZUSA CONSENT ITEM E-9 TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS VIA: TROY L. BUTZLAFF, ICMA-CM, CITY MANAGER FROM: ANN GRAF, DIRECTOR OF INFORMATION TECHNOLOGY AND LIBRARY SERVICES DATE: APRIL 20, 2015 SUBJECT: ACCEPTANCE OF AMERICAN DREAM GRANT FROM AMERICAN LIBRARY ASSOCIATION SUMMARY Azusa City Library's Adult Literacy Program has been awarded The American Dream Grant in the amount of$8,425 to support Spanish literacy programs at the Library. This action accepts the grant award on behalf of the Library. RECOMMENDATION It is recommended that the City Council takes the following actions: 1) Approve acceptance of grant award from the American Library Association in the amount of$8,425. 2) Approve the budget amendment associated with this grant. BACKGROUND Becoming literate in Spanish offers immediate benefits while preparing students to increase their income and attain personal goals and life skills by learning English. Without basic literacy skills in their native language, adults struggle in English as a Second Language classes and often drop out. For many Spanish speaking adults, learning to read and write in Spanish is the first step to learning English. Illiterate Spanish speaking adults will directly benefit from the program. The Library applied for a grant through the American Library Association to support Spanish literacy programs. The grant will fund a program to introduce Spanish speaking adults to the public library and its vast array of services for them and their families. This includes the use of Leamos a simple easy to use on-line Literacy course for non-literate Spanish speaking adults. _ FISCAL IMPACT The fiscal impact is positive. The grant covers funding for the Spanish Literacy programs at the Library. No additional matching funds are required. Prepared by: Ann Graf Director of Information Technology and Library Services Reviewed and Approved: Troy L. Butzlaff,ICMA-CM City Manager APPROVED COUNCIL MEETING Date, I ' • AZUSi CONSENT ITEM E-1 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: AMELIA AYALA,DIRECTOR OF HUMAN RESOURCES &RISK MANAGEMENT VIA: TROY BUTZLAFF, ICMA-CM, CITY MANAGER DATE: APRIL 20, 2015 SUBJECT: HUMAN RESOURCES ACTION ITEMS RECOMMENDATION It is recommended that the City Council approve the following Personnel Action Requests in accordance with the City of Azusa Civil Service Rules and applicable Memorandum of Understanding(s). BACKGROUND On April 14,2015,the Personnel Board confirmed the following Department Head(s)recommendation regarding the following Personnel Action request(s). A. MERIT INCREASE AND/OR REGULAR APPOINTMENT: DEPARTMENT NAME CLASSIFICATION ACTION/EFF RANGE/STEP DATE BASE MO SALARY CC Annette Juarez Administrative Technician Merit Increase 4174/3 3/24/2015 $4,454.67 FN Naomi Narvaez Senior Administrative Regular Appt. 4179/5 Technician 11/19/2014 $5,128.37 PD Anthony Conwell Police Officer Merit Increase 6101/2 3/12/2015 $6,245.84 PD Rick Hayden Police Sergeant Merit Increase 3416/5 2/4/2015 $9,592.22 PD Rosa Sok Police Records Specialist III Merit Increase 9160/5 3/15/2015 $4,389.01 PW Christopher Street Maintenance Worker I Merit Increase 8153/4 Gutierrez 3/28/2015 $4,047.63 B. NEW APPOINTMENT: The following appointments have been requested by department heads pursuant to the Rules of The Civil Service System. DEPARTMENT NAME CLASSIFICATION EFFECTIVE DATE RANGE/STEP BASE MO. SALARY Human Resources Lislene Ledezma Human Resources Technician Pending successful 4174/2 completion of $4,252.59 fingerprint and physical C. RECLASSIFICATION—The following reclassification has been requested by the department head and is being made in accordance with the City of Azusa Rules of the Civil Service System. DEPARTMENT NAME CLASSIFICATION EFFECTIVERANGE/STEP FROM/TO DATE BASE MO.SALARY Police Rose Rodriguez From: Police Records Specialist III 07/01/2014 9165/5 To: Police Records Supervisor $4,608.46 FISCAL IMPACT There is no fiscal impact,as positions listed are funded in approved department budgets.