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HomeMy WebLinkAbout02. Approved Staff Report & Resolutions_201707171852599989A TTTl1<TTT VA -I - A A -X- A -T- SCHEDULED ITEM D-8 TO: HONORABLE MAYOR/CHAIRMAN AND CITY COUNCIL/BOARD MEMBERS FROM: TROY L. BUTZLAFF, ICMA-CM, CITY MANAGER DATE: JUNE 19, 2017 SUBJECT: ADOPTION OF FISCAL YEAR 2017/18 CITY, UTILITIES, PUBLIC FINANCING AUTHORITY, AND SUCCESSOR AGENCY OPERATING AND CAPITAL IMPROVEMENT PLAN BUDGETS SUMMARY: The City's annual budget is an important policy document. It serves as an annual financial plan, identifying the spending priorities for the organization. The budget is used to balance available resources with community needs, as determined by the City Council. It also serves as a tool for communicating the City's financial strategies and for ensuring accountability. The City's operating budget is a plan for one specified fiscal year. The fiscal year for this budget begins on July 1, 2017 and ends on June 30, 2018. An overview of the City's Fiscal Year 2017/18 Preliminary Operating Budget and Capital Improvement Budget (CIP) Budget was provided to the City Council at a Budget Study Session on May 30, 2017. This action will approve resolutions adopting the FY 2017/18 budgets for the: City, Utility, Public Financial Authority and Successor Agency of the Former Redevelopment Agency of the City of Azusa. RECOMMENDATION: Staff recommends that the City Council take the following actions: 1) Adopt Resolution No. 2017-C45, A Resolution of the City Council of the City of Azusa adopting the budget and approving appropriations for the City of Azusa for the fiscal year commencing July 1, 2017 and ending June 30, 2018; 2) Adopt Resolution UB-07-2017, A Resolution of the Utility Board of the City of Azusa adopting the budget and approving appropriations for Utilities for the fiscal year commencing July 1, 2017 and ending June 30, 2018; 3) Adopt Resolution 2017-P1, A Resolution of the Azusa Public Financing Authority of the City of Azusa adopting the budget and approving appropriations for the Authority for the fiscal year commencing July 1, 2017 and ending June 30, 2018; and 4) Adopt Resolution 2017-R08, A Resolution of the Successor Agency for the Former Redevelopment Agency of the City of Azusa adopting the budget and approving appropriations for the Agency for the fiscal year commencing July 1, 2017 and ending June 30, 2018. FY 2017-18 Budget Adoption June 19, 2017 Page 2 DISCUSSION: The City Council held a budget study session on May 30th to review the preliminary operating budget and Capital Improvement Program. At that time, the Finance Director provided an overview of the upcoming year and presented assumptions, charts, and changes from prior years that were included in the preliminary budget. The City Council asked questions and made comments with regard to the proposed operating budget. In addition, City Council was provided an overview of the proposed projects provided for in the City's Capital Improvement Project budget. City Council did not request any changes to the proposed budgets at the budget study session. Below are highlights from the Preliminary FY 2017/18 General Fund Budget: • The Budget is balanced with a projected change in fund balance of $1.5 million and includes: o One-time revenues of $2.8 million o One-time operating expenditures of $1.2 million o Operating deficiency of $145,140 with removal of one-time items • Best practice of budgeting for attrition/vacant position savings (-$331,905). • Includes proposed personnel changes reflecting new positions and classification changes recommended by the Class and Compensation study ($325,865). • Includes impact of part-time compaction due to minimum wage increases ($37,000) • LA County Fire contract increase of 7.0% ($328,568) mandated by agreement. • Increased CalPERS costs of $250,665 due to re -structuring of funding unfunded liabilities. • The uncommitted reserve fund balance is expected to increase to $9.5 million by the end of FY 2017/18, inclusive of one-time revenues and expenditures. FIVE YEAR CAPITAL IMPROVEMENT PLAN [CIP); For Fiscal Year 17/18, Staff proposes a 5-year CIP Plan totaling $77.0 million City-wide. Of the $77.0 million CIP plan, $38.2 million in projects are expected to be funded by non -general fund sources and $38.8 million are currently unfunded. The total proposed CIP budget for FY 17/18 is $16.1 million City-wide, of which $5.4 million is currently unfunded, plus estimated carryover projects of $8.7 million. Some of the major funded projects proposed for FY 17/18 include: • Citywide traffic management system improvements ($5.7M) • Advanced meter infrastructure implementation ($1.3M) • Foothill Blvd. pavement improvements ($790K) • L&W Lobby Remodel ($370K) • West Wing drop ceiling abatement and seismic improvements ($270K) • Bus stop improvements ($220K) • Library restroom improvements ($195K) • Various ADA improvements ($146K) • Sierra Madre street improvements ($124K) • Foothill Blvd/Dalton Ave traffic signal ($108K) • Priority 1 city facilities condition assessments ($88K) • Citywide street signing, striping, and curb painting ($50K) FY 2017-18 Budget Adoption June 19, 2017 Page 3 A summary of the proposed City-wide budget for FY 17/18 is attached to this report. CONCLUSION: The proposed operating budget for FY 17/18 reflects the ongoing efforts of Staff to maintain service levels while achieving long-term fiscal stability. For many programs, comparisons between the proposed and prior -year budgets show decreases due to continued materials, services and supplies cost reduction efforts in addition to exploring alternative funding sources in order to keep the General Fund solvent. Staff continues to explore various methods for providing services in the most cost-effective way possible, as well as examine different opportunities to address the City's unfunded liabilities such as retiree medical, leave bank accruals and retirement costs that continue to be major impediments to achieving fiscal sustainability. One of the benchmarks used to assess the General Fund's progress toward financial sustainability is the General Fund Reserve Policy. The City's 15% reserve target for FY 17/18 is approximately $6.1 million based on the proposed $40.8 million budget. The FY 17/18 proposed budget is expected to provide for an uncommitted fund balance of $9.5 million by the end of FY 17/18 or a 23% reserve level. However, this level of reserves is largely due to significant one-time revenues generated by property sales in FY 16/17 and proposed in FY 17/18. One of the guiding principles to the City's budgeting policy is "Do not use `one-time money' for ongoing operations". Current reserve levels provides opportunity to better strategically address some of the aforementioned unfunded liabilities or internally restrict reserves to fund future costs such as necessary facility/infrastructure improvements or general liability and worker's compensation administration. Staff will continue to monitor the City's budget to ensure on -going operational costs are able to be sustained with on -going revenues. FISCAL IMPACT: The fiscal impact of the Combined Operating Budget is $153,540,281 (including Internal Services) with Transfers of $11,586,970 and comprising of the following: By Aizenc City $ 70,555,518 $ 10,587,615 $ 81,143,133 Utilities (L&W) 65,584,158 999,355 66,583,513 APFA 355,215 - 355,215 Successor Agency 5,458,420 - 5,458,420 Total Budget $ 141,953,311 $ 11,586,970 $ 153,540,281 FY 2017-18 Budget Adoption June 19, 2017 Page 4 General Internal Services Special Revenue Debt Service Enterprise Capital Projects Fund Successor Agency Total Budget By Fund 7" e 34,509,350 $ 6,251,585 $ 40,760,935 12,415,646 523,830 12,939,476 20,837,148 332,600 21,169,748 3,505,490 3,060,920 6,566,410 65,118,807 1,418,035 66,536,842 108,450 - 108,450 5,458,420 - 5,458,420 S 141 953,311 $ 11,586 970 $ 153 540,281 A summary of the proposed City-wide budget for FY 2017/18 is attached to this report. The full budget documents are available for review at the City Clerk's Office, the Library or on the City's website. Prepared by: Talika M. Johnson Director of Finance Reviewed and Approved: Troy L. Butzlaff, ICMA-CM City Manager Attachments: Reviewed and Approved: Louie F. Lacasella Management Analyst 1) Resolution No. 2017-C45, A Resolution of the City Council of the City of Azusa adopting the budget and approving appropriations for the City of Azusa for the fiscal year commencing July 1, 2017 and ending June 30, 2018; 2) Resolution No. UB-07-2017, A Resolution of the Utility Board of the City of Azusa adopting the budget and approving appropriations for Utilities for the fiscal year commencing July 1, 2017 and ending June 30, 2018; 3) Resolution No. 2017-P1, A Resolution of the Azusa Public Financing Authority of the City of Azusa adopting the budget and approving appropriations for the Authority for the fiscal year commencing July 1, 2017 and ending June 30, 2018; and 4) Resolution No. 2017-R08, A Resolution of the Successor Agency for the Former Redevelopment Agency of the City of Azusa adopting the budget and approving appropriations for the Agency for the fiscal year commencing July 1, 2017 and ending June 30, 2018. 5) Fiscal Year 2017/18 Budget Summaries RESOLUTION NO. 2017-C45 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA ADOPTING THE BUDGET AND APPROVING APPROPRIATIONS FOR THE CITY OF AZUSA FOR THE FISCAL YEAR COMMENCING JULY 1, 2017 AND ENDING JUNE 30, 2018. THE CITY COUNCIL OF THE CITY OF AZUSA DOES RESOLVE AS FOLLOWS: SECTION 1. The preliminary budget for the City of Azusa for the fiscal year commencing July 1, 2017 and ending June 30, 2018, presented and reviewed at a public workshop held May 30, 2017, is hereby approved and adopted as the budget of the City of Azusa for said fiscal year. SECTION 2. From the effective date of said budget, the several amounts stated herein as proposed expenditures shall be and become appropriated to the several departments, offices and agencies of the City for the respective objects and purposes therein set forth, subject to expenditure pursuant to the provisions of all applicable ordinances of the City and statutes of the State. Further, it is established that said departments, offices, and agencies of the City shall not exceed their respective budgets. SECTION 3. All appropriations in the 2016-2017 budget of the City not expended or encumbered hereby expire and terminate, except for those appropriations expressly continued and carried forward into the budget for 2017-2018. Appropriations for Capital Improvement Projects and Capital Outlay are hereby carried forward until project completion or equipment acquisition. SECTION 4. Pursuant to Government Code 37208, warrants drawn in payment of demands certified or approved by the City Clerk as conforming to a budget approved by ordinance or resolution of the City Council need not be audited by the City Council prior to payment. Budgeted demands paid by warrant prior to audit by the City Council shall be presented to the City Council for ratification and approval at the first meeting after delivery of the warrants. SECTION 5. The City Clerk shall certify as to the adoption of this resolution. PASSED, APPROVED and ADOPTED this 19"' day of June, 2017. /4'6'a ('�� - xr'-4 osep6 RRomero Rocha Mayor ritiltc:c y .r Cornejo y Clerk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution No. 2017-C45 was duly adopted by the City Council of the City of Azusa at a regular meeting held on the 191h day of June 2017, by the following vote of the Council: AYES: COUNCILMEMBERS: GONZALES, CARRILLO, MACIAS, ALVAREZ, ROCHA NOES: COUNCILMEMBERS: NONE ABSTAIN: COUNCILMEMBERS: NONE ABSENT: COUNCILMEMBERS: NONE 1. iA ce Cornewr'� City Cler APPROVED AS TO FORM: Best I e:st & KtIe:g r, 1.i.P City ttorney RESOLUTION NO. UB-07-2017 A RESOLUTION OF THE UTILITY BOARD OF THE AZUSA LIGHT AND WATER ADOPTING THE OPERATING BUDGET AND APPROVING APPROPRIATIONS FOR AZUSA LIGHT AND WATER FOR THE FISCAL YEAR COMMENCING JULY 1, 2017 AND ENDING DUNE 30, 2018 THE UTILITY BOARD OF AZUSA LIGHT AND WATER DOES RESOLVE AS FOLLOWS: SECTION I. The preliminary budget for Azusa Light and Water ("Utility") for the fiscal year commencing July 1, 2017 and ending June 30, 2018, presented and reviewed at a public workshop held May 30, 2017, is hereby approved and adopted as the Utility budget for said fiscal year. A copy of said budget is hereby ordered to be filed in the office of the Secretary and shall be certified by the Secretary as having been adopted by this resolution. SECTION 2. From the effective date of said budget, the several amounts stated therein as proposed expenditures shall be and become appropriated to the respective objects and purposes therein set forth for Utility subject to expenditure pursuant to the provisions of all applicable ordinances of Utility and statutes of the State. Further, it is established that Utility will not exceed its budget. SECTION 3. All appropriations in the 2016-2017 budget of Utility not expended or encumbered hereby expire and terminate, except for those appropriations expressly continued and carried forward ("rebudgeted") into the budget for 2017-2018. Appropriations for Capital Projects and Capital Outlay are hereby carried forward until project completion or equipment acquisition. SECTION 4. Pursuant to Government Code 37208, warrants drawn in payment certified or approved by the Secretary as conforming to a budget approved by ordinance or resolution of Utility Board need not be audited by Utility Board prior to payment. Budgeted demands paid by warrant prior to audit by Utility Board shall be presented to the Utility Board for ratification and approval at the .first meeting after delivery of the warrants. SECTION 5. The Secretary shall certify to the adoption of this resolution. PASSED, APPROVED and ADOPTED this 19'h day of June, 2017, aseph Romero Rucha Board Member/Mayor ATTEST: .I !i' y _a •e Cornejo, , Secretary 'ity Clerk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution No. UB-07-2017 was duly adopted by the Utility Board/City Council of the City of Azusa at a special meeting of the Azusa Light & Water Utility Board on the 191" day of June, 2017. AYES: BOARD/COUNCILMEMBERS: GONZALES, CARRILLO, MACIAS, ALVAREZ, ROCHA NOES: BOARD/COUNCILMEMBERS: NONE ABSENT: BOARD/COUNCILMEMBERS: NONE 4ffrnce Corncjo, Secretary/City Clerk APPROVED AS TO FORM: City Att rney Best Be & Krieger, RESOLUTION NO. 2017-PI A RESOLUTION OF THE BOARD OF DIRECTORS OF THE AZUSA PUBLIC FINANCING AUTHORITY ADOPTING THE BUDGET AND APPROVING APPROPRIATIONS FOR THE AUTHORITY FOR THE FISCAL YEAR COMMENCING DULY 1, 2017 AND ENDING JUNE 30, 2018 THE BOARD OF DIRECTORS OF THE AZUSA PUBLIC FINANCING AUTHORITY DOES RESOLVE AS FOLLOWS: SECTION 1. The preliminary budget for the Azusa Public hinancing Authority for the fiscal year commencing July 1, 2017 and ending ,tune 30, 2018, presented and reviewed at a public workshop held May 30, 2017, is hereby approved and adopted as the budget of the Azusa Public Financing Authority for said fiscal year. A copy of said budget is hereby ordered to be tiled in the office of the Secretary and shall be certified by the Secretary as having been adopted by this resolution. SECTION 2. From the effective date of said budget, the several amounts stated therein as proposed expenditures shall be and become appropriated to the respective objects and purposes therein set forth for the Authority subject to expenditure pursuant to the provisions of all applicable ordinances of the Authority and statutes of the State. Further, it is established that the Authority will not exceed its budget. SECTION 3. Pursuant to Government Code 37208, warrants drawn in payment certified or approved by the Secretary as conforming to a budget approved by ordinance or resolution of the Authority Board need not be audited by the Authority Board prior to payment. Budgeted demands paid by warrant prior to audit by the Authority Board shall be presented to the Authority Board for ratification and approval at the first meeting after delivery of the warrants. SECTION 4. The Secretary shall certify to the adoption of this resolution. PASSED, APPROVED and ADOPTED this 19"' day of June, 2017. seph Romero Rocha Chairperson AT' : 'T; r A Cornejo Jr. Secretary ' STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution No. 2017-P1 was duly adopted by the Board of Directors of the Azusa Public Financing Authority at a regular meeting thereof, held on the 19'" day of June, 2017, by the following vote of Board: AYES: BOARDMEMBERS: GONZALES, CARRILLO, MACIAS, ALVAREZ, ROCHA NOES: BOARDMEMBERS: NONE ABSENT: BOARDMEMBERS: NONE J A e Corneso, ., ccretary APPROVED AS TO FORM: Best Bes & Krieger, Ll' City Attorney RESOLUTION NO. 2017-1108 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY FOR THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF AZUSA ADOPTING THE OPERATING BUDGET AND APPROVING APPROPRIATIONS FOR THE SUCCESSOR AGENCY OF THE FORMER REDEVELOPMENT AGENCY OF THE. CITY OF AZUSA FOR THE FISCAL YEAR COMMENCING JULY 1, 2017 AND ENDING JUNE 30, 2018 THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF AZUSA DOES RESOLVE AS FOLLOWS: SECTION 1. The operating budget for the Successor Agency of the former Redevelopment Agency of the City of Azusa ("Agency") for the fiscal year commencing July 1, 2017 and ending June 30, 2018, presented and reviewed at a public workshop held May 30, 2017, is hereby approved and adopted as the budget of the Agency for said fiscal year, A copy of'said budget is hereby ordered to be 'filed in the office of the Secretary and shall be certified by the Secretary as having been adopted by this resolution. SECTION 2. From the effective date of said budget, the several amounts stated therein as proposed expenditures shall be and become appropriated to the respective objects and purposes therein set forth for the Agency subject to expenditure pursuant to the provisions of all applicable ordinances of the Agency and statutes of the State. Further, it is established that the Agency will not exceed its budget. SECTION 3. All appropriations in the 2016-2017 budget of the Agency not expended or encumbered hereby expire and terminate, except for those appropriations expressly continued and carried forward ("rebudgeted") into the budget for 2017-2018. Appropriations For Capital Projects and Capital Equipment are hereby carried forward until project completion or equipment acquisition. SECTION 4. Pursuant to Government Code 37208, warrants drawn in payment certified or approved by the Secretary as conforming to a budget approved by ordinance or resolution of the Agency Board need not be audited by the Agency Board prior to payment. Budgeted demands paid by warrant prior to audit by the Agency Board shall be presented to the Agency Board for ratification and approval at the first meeting after delivery of the warrants, SECTION S. The Secretary shall certify to the adoption of this resolution. PASSED, APPROVED and ADOPTED this 19th day of June, 2017. Jost411lian Romero Rocha Chd Ir t4eCej, Secretary !� CERTIFICATION I, Jeffrey Lawrence Cornejo Jr., City Clerk of the City of Azusa, do hereby certify that Resolution No. 2017-R08 was duly adopted by the City Council of the City of Azusa, serving as the Successor Agency to the Former Redevelopment Agency, at a regular meeting held on the 19"' day of June 2017, by the following vote of the Agency: AYES: AGENCY MEMBERS: GONZALES, CARRILLO, MACIAS, ALVAREZ, ROCHA NOES: AGENCY MEMBERS: NONE ABSENT: AGENCY MEMBERS: NONE .V Jr. Secretary APPROVED AS TO FORM: Bes Best & Krieg ", [,LP City Attorney r �y 0- O O (o IT Na O O O C+ O CO Cl) W 00 u7 CO 0 LO N M W) CO OD M M Gi ICI A N 7 CA CD C` N CMO N N O r (O N O N to N r r 0 13 N CA 00 00 C` CC CV Cq C- co O co N U 2 O O a LO 7 Cl) h R R Cl m Cn N.-ItW V CT CO Ni N CO CA C, C'f) It � N Cf) CA- co CM n (p P C m M � O W 0) M 0) M � M M O C'] N 'e O c) 't C)') 0 r ifi COO CvOj T r 0 tD N N 0 r r M CO IW C O fA r r r OO r N M� W LL C � O Ca 3 C\ 'IT i0 -IT 0 0 Cn Lo Cr) CD p ^ O O O O O O O O O O h a0 Y) L �i ydj m O C w 0 M C CA � C- CO co CA N C Oi CO C, �) - O CO II] O O r r C7 C O N C'�7 r p O! 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