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HomeMy WebLinkAboutMinutes - May 2, 2017 SSLODI CITY COUNCIL SHIRTSLEEVE SESSION CARNEGIE FORUM, 305 WEST PINE STREET TUESDAY, MAY 2, 2017 A. Roll Call by City Clerk An Informal Informational Meeting ("Shirtsleeve" Session) of the Lodi City Council was held Tuesday, May 2, 2017, commencing at 7:00 a.m. Present: Council Member Chandler, Council Member Johnson, and Mayor Pro Tempore Nakanishi Absent: Council Member Mounce, and Mayor Kuehne Also Present: City Manager Schwabauer, City Attorney Magdich, and City Clerk Ferraiolo B. Topic(s) B-1 Receive Presentation Regarding Fiscal Year 2017/18 General Fund Budget and the Five - Year General Fund Forecast (CM) Deputy City Manager Andrew Keys provided a PowerPoint presentation regarding Fiscal Year 2017/18 General Fund budget and the five-year General Fund forecast. Specific topics of discussion included Fiscal Year (FY) 2017/18 revenues, revenue trends, FY 2017/18 expenses, new position, key inputs, vehicle replacement fund, five-year General Fund forecast, revenue assumptions, expense assumptions, California Public Employees Retirement System (Cal -PERS) rate assumptions, revenues, expenses, fund balance, impact of 1 percent revenue shortfall in FY 2017/18, impact of new revenue, new revenue with 1 percent revenue shortfall in FY 2017/18, and risks and opportunities. Council Member Johnson requested Council be provided with information on expense trends, similar to the chart on revenue trends, to which Mr. Keys responded he would provide the information. In response to Mayor Pro Tempore Nakanishi, Mr. Keys stated that Lodi's percentage of salaries, Cal -PERS costs, and other benefits is roughly 75 percent of the entire budget, which is average for cities. He stated that Elk Grove is around 70 percent and estimated that most cities fall in the 65 to 75 percent range. City Manager Schwabauer added that the major difference between last year's budget and this one is the Cal -PERS lines and further pointed out that Elk Grove is a young pension system because it has not been a city for a long time; it hires contractors versus employees; and it does not have parks or fire in its municipal budget. In further response to Mayor Pro Tempore Nakanishi, Mr. Keys stated he would research the percent of personnel expenses in the San Joaquin County, City of Stockton, and City of Tracy budgets, adding that it will be based on a comparison of FY 2015/16 actuals, which will not include the Cal -PERS unfunded actuarial liability (UAL). In response to Mayor Pro Tempore Nakanishi, Mr. Keys explained that MOE stands for "maintenance of effort," which is the required level of funding to receive Measure K funds. If the MOE was cut from the budget, the City would realize a savings in the General Fund; however, the City would lose the same amount of Measure K dollars. Mr. Schwabauer explained the line item in the PowerPoint is to reflect what staff recommends continuing and what it does not. Staff is not sacrificing the MOE and Measure K funding and is choosing to prioritize the $435,000 capital contribution over the vehicle replacement program. All of these choices represent the key drivers and sacrifices made to balance the FY 2017/18 budget. In response to Council Member Johnson, Police Captain Chris Jacobson stated there are currently six officers working in field training; several should be in the field soon; and there are 1 currently no officers going through the academy. In response to Mayor Pro Tempore Nakanishi, Mr. Keys explained there are two aspects of property tax: 1) one is the ad valorem tax, which is 1 percent of full cash value; and 2) the Community Facilities District (CFD), which will be $510 per house next year and includes a 2 percent inflationary increase. Staff estimated 70 units and $35,000 in CFD revenue in next year's budget, while the forecast projects similar growth. Mr. Keys confirmed the values for the properties are incorporated into the property tax revenue projections. Mr. Schwabauer further explained the City receives 16 percent of the 1 percent property tax, which equates to roughly $700 per household for $50,000 a year in property taxes. Between property taxes and CFD revenue, the City takes in $75,000 to $80,000 in revenue. Mr. Keys stated there are three ways to grow with property tax: through the CFD; through the 2 percent change in property tax when an owner stays in a home and the property value increases; and after the resale of a home. Council Member Johnson questioned the explanation under the revenue assumption category for "Intergovernmental - Other" because it appears as if the City is receiving money or a credit for not funding the Delta Regional Auto Theft Task Force. Mr. Schwabauer responded this category is for State legislative matters that are funded, such as the Hayden Act that reimburses cities for housing animals longer than the mandated three days, and are typically for general fund related mandates. Mr. Keys added this type of revenue is typically inconsistent and differs from budget to budget; whereas, property tax estimates are based on historical trends. Mr. Schwabauer provided an example of the inconsistency, stating one year the State funded the City $750,000 for a mandate and the next year only $40,000. In response to Council Member Chandler, Mr. Keys stated that the category of "Other Taxes" includes the Transient Occupancy Tax, which has steadily increased and continues to grow; however, he pointed out that at some point there will be saturation once the maximum number of rooms is rented. He stated staff will revisit the forecast once new hotels start coming on line but there needs to be planning/construction activity before revenue can be projected. Mr. Schwabauer pointed out that the five-year projection for expenses does not represent staffs assumption on what Council will, or will not, do with salaries; instead, it is the minimum case scenario. Mr. Keys added that labor negotiations on employee contracts are unknown and any adjustments will require the forecast to be revisited. In response to Council Member Johnson, Mr. Keys stated the next debt refinancing opportunity will be 2022, the savings from which would be minimal. Because rates are an unknown at this time, debt refinancing was not incorporated in the five-year budget assumptions. Mr. Schwabauer summarized that the Cal -PERS rate assumption is not adjusted for compounding interest and pointed out that the Safety plan will cost the City 106 to 150 percent more than it does today. In response to Council Member Johnson, Mr. Schwabauer stated that Cal -PERS, if asked, will assume a 6.2 percent return on investments; however, Cal -PERS is facing negative equity for the foreseeable future by paying more in Cal -PERS benefits than it is receiving in combined interest and payments from cities and employees. Because it is paying more than it is taking in, Cal - PERS continues to draw down its principle. Lodi is in the same situation because it most recently paid $16 million in benefits to retirees and paid in and earned $14 million, which brought down the principle by $2 million that year. In further response, Mr. Schwabauer stated that Cal -PERS makes poor investments, however it is required to play by a different set of rules. Mr. Keys added that Cal -PERS has missed out on investment opportunities because its investments are hampered by legislation. Mr. Schwabauer explained the UAL growth is projected for five years but not for year six and beyond because there is no actuarial going out that far. He stated the Cal -PERS bill continues to climb and, in the hypothetical exercise of adding sales tax revenue to the five-year projection, that new revenue would still not cover the Cal -PERS bill after that period of time. 2 Council Member Chandler asked Lodi Chamber of Commerce Executive Director Pat Patrick to comment on the five-year revenue projection that assumes a half -cent sales tax in 2018. Mr. Schwabauer stressed that staff is not recommending a sales tax measure; it was solely to demonstrate the effect a new revenue source would have on the five-year projection. Mr. Patrick stated it was premature for the Chamber to comment on the concept, but he recognized that the City is in long-term dire straits. He reminded Council of its goal of economic development and stated the vacant lots east of Highway 99 still have no infrastructure to entice new businesses. He recognized Lodi does not own those properties but stated he believes the City needs to be more competitive and prepared for economic development opportunities. Mr. Patrick invited Mr. Keys to meet to discuss issues effecting the community, adding that the Chamber's number one purpose is to help the business community thrive. He pointed out that Lodi's population is aging and many are choosing to leave California, which will negatively effect future sales and property tax revenues. Mr. Keys welcomed the opportunity to meet with Mr. Patrick, stating he would like to form a relationship with the Chamber and the business community. He too stressed that staff did not recommend a sales tax option; instead, it was presented as one revenue enhancement solution for the financial problem facing Lodi. He stated that, absent major changes on the expenditure side of the budget, the City will have a challenging time balancing the budget. Mr. Keys stated that, if the tax option is pursued, the City will involve the business community and interested parties to develop a solution together. C. Comments by Public on Non -Agenda Items None. D. Adjournment No action was taken by the City Council. The meeting was adjourned at 8:09 a.m. ATTEST: Jennifer M. Ferraiolo City Clerk 3 CITY OF LODI COUNCIL COMMUNICATION AGENDA ITEM BI AGENDA TITLE: Receive Presentation Regarding Fiscal Year 2017/18 General Fund Budget and the 5 -Year General Fund Forecast MEETING DATE: May 2, 2017 PREPARED BY: Andrew Keys, Deputy City Manager RECOMMENDED ACTION: Receive presentation regarding Fiscal Year 2017/18 General Fund budget and the 5 -Year General Fund forecast. BACKGROUND INFORMATION: Staff has planned a presentation series to provide Council and the public opportunity to review and comment on basic assumptions within the budget to be proposed to Council later this month. The budget will be released and made available for public review at City Hall and online once a draft is finalized. This session is designed to provide information on the general economic circumstances facing City Staff and Council in allocating resources to most effectively deliver services, with particular focus on the General Fund. Included in the presentation will be discussion of the City's 5 -year General Fund forecast. The forecast is a critical planning tool for staff and Council use to anticipate future resource or service level adjustment needs. The forecast presented will include a baseline scenario that keeps normal operations with no change in service levels. It will also provide some basic sensitivity analysis that shows the impact of potential additional resources as well as the impact a negative turn in the economy might have on the City's financial health. Future Council budget presentations will focus on other aspects of the City's budget beyond the General Fund. The first opportunity for the City Council to adopt the Fiscal Year 2017/18 budget will be at its regular meeting on June 7, 2017. FISCAL IMPACT: FUNDING AVAILABLE: There is no impact from this informational presentation. The General Fund for Fiscal Year 2017/18 is balanced with a total of $48,369,550 in projected revenue and the same in expenses. Staff continues to research the impacts of assessing cost of services to those departments who have traditionally not paid such charges. If these charges are levied to these departments in Fiscal Year 2017/18, staff recommends investing these funds in the City's Pension Stabilization Reserve account with Public Agency Retirement Services (PARS). This investment would provide some cash flow relief as the City's Unfunded Accrued Liability (UAL) to the CaIPERS system increases. 07,47-4,„„ )6_ Andrew Keys, Deputy Ciy Manager APPROVED: tephen 1"" abauer, City Manager Fiscal Year 2017/18 Budget General Fund Forecast Presented by: Andrew Keys, Deputy City Manager Agenda • Fiscal Year 2017-18 General Fund — Assumptions — Revenues — Expenses by Department — Expenses by Type • New Position • Key Inputs • Five Year Forecast — Assumptions — Projection — Risks/Known Challenges — Opportunities FY 17-18 Revenues $48,369,550 33% 2,1:1}} 4.13} 3,3}} ■ Property Tax • 5ales Tax Fara prat Occupancy Tax Burins Taxes • Franchise Fees 1 Lodi Electric PILOT roperty Tax in Lieu Rent it & nvest rnent Cost of Services =I7= '2E= 'or Servi€ s& Perm its Fines and Penalties rel Esc Revenue and Grants Revenue Trends Revenue Trends FY 17-18 Expenses $48,369,550 FY 17-18 F Expenditures by Function 2.6 5,8}} 4,3}} 4.8E:49.3% �� M 24.2% • Go.'t and Adm in • Internal Services • Police Depart me nt • Fire Delsarkrrie rit • Pu 1;c 'y\' crI S • PRCS • Library • N on -De par tni enta FY 17-18 Expenses $48,369,550 FY 17-18 General Fund Expenditures by Type ■ Salary ■ PERS Norm al Cost ■ PERS LSML ■ Either Benefits ■ Operations ■ Debt Service ■ Transfers FY 17-18 New Position • Accountant — Funded by transfers in from the utility funds — Will provide accounting support for utility billing and utility functions — Will free up existing resources to focus on all aspects of accounting and internal controls Key Inputs FY 17-18 • Fire Engine 1 browned out 70% • Two police officers unfunded until Mid Year • Fire $100,000 to Vehicle Replacement • Police not contributing Vehicle Replacement • Continued $1.3 M MOE for Measure K • $435,000 Capital Contribution • Admin Secretary in Library is eliminated — Employee was moved to Fire to fill a vacated Senior Admin Clerk position. Vehicle Replacement Funds PW - GF PRCS Police Dept. Fire Dept. FY 15-16 YE Fund Balance YE Est. Rev. FY 16-17 YE Est. Exp. FY 16-17 YE Est. FY 16-17 Fund Target Over/ (Under) Target Comm. Dev Vehicle Replacement Fund Grand Total $21,694 $864,013 $660,672 $380,638 $115,379 $2,042,395 $21,000 $0 $358,717 $55,300 $3,980 $438,997 $0 $624,881 $177,193 $64,000 $30,000 $896,074 $42,694 $239,131 $842,196 $371,938 $89,359 $1,585,318 $15,025 $2,206,862 $1,444,016 $919,189 $155,503 $4,740,594 $27,669 ($1,967,731) ($601,819) ($547,251) ($66,144) ($3,155,277) 5 -YEAR GENERAL FUND FORECAST Revenue Assumptions Revenue Category FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Property Taxes - Secured Property Taxes - CFD [1] Property Taxes - Other Sales & Use Taxes [2] Other Taxes EU Pilot Fees & Permits [3] Property Tax in Lieu VLF Intergovernmental - Other [4] Services Charges [5] Fines & Forfeitures [6] Use of Money Other Revenues Transfer In 4.0% 3.7% 3.7% 3.7% 3.7% 3.7% N/A N/A 51.6% 25.8% 26.4% 17.6% 5.3% 2.1% 1.8% 1.9% 1.9% 1.9% -0.2% 2.3% 1.8% 1.9% 1.9% 1.9% 3.7% 1.8% 2.1% 1.7% 1.8% 1.6% 0.4% 0.5% 0.5% 0.5% 0.5% 0.5% 8.5% 1.5% 1.5% 1.5% 1.5% 1.5% 2.3% 2.0% 2.0% 2.0% 2.0% 2.0% -11.8% 0.0% 0.0% 0.0% 0.0% 0.0% 23.1% -29.9% -20.0% 0.0% 0.0% 0.0% 27.1% 0.0% 0.0% 0.0% 0.0% 0.0% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 4.9% 4.6% 1.3% 1.4% 1.4% 1.4% 7.4% 4.2% 4.2% 2.6% 1.2% 1.2% [1] Some revenue may be received in Fiscal Year 2017/18. Future year's growth accounts for projected growth and 2% CPI. [2] The decrease in Fiscal Year 2017-18 is due to adjustments to the City's share of the County Pool as a result of historical misallocations. Actual economic activity is projected to increase approximately 3.5%. [3] FY 17/18 increase due to anticipated continued strong economic growth. [4] FY 17/18 decrease is due to the elimination of Delta RATT and state mandate reimbursements. [5] FY 17/18 Public Work fee revenue is anticipated to increase with the growing demand for development related engineering services. A gradual reduction to more normal collection rate is projected. [6] The FY 17/18 increase due to reduced utility late fee collections in FY 16/17 caused by the Munis conversion. Expense Assumptions Expense Category FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Salaries [1] PERS Normal Cost [1] [2] PERS UAL [2] Other Benefits [1] Operations Debt [3] Transfers 0.7% N/A N/A 4.4% -8.0% 0.0% 0.1% 1.5% 9.0% 22.0% 2.5% 4.5% 0.0% 0.5% 0.7% 7.8% 20.0% 2.5% 4.5% -0.2% 0.5% 0.5% 13.2% 17.5% 2.5% 4.5% 0.0% 0.5% 0.5% 0.5% 12.7% 2.5% 4.5% 0.3% 0.5% 0.5% 0.5% 10.0% 2.5% 4.5% -0.4% 0.5% [1] FY 2017-18 based on current employee salaries with allowance for step increases to eligible employees. No allowance is made for benefit changes, employee benefit choices or salary scale adjustments. [2] PERS rates will be assessed differently in FY 17-18 with normal cost separated from UAL. Growth in PERS outpaces salary growth due to UAL. Estimates are based on the high end of the cost increase range provided by CaIPERS. More information is not available until the City's actuarial is completed in August. [3] Based on actual debt service schedules for existing debt. Does not assume any refinancing opportunity. CaIPERS Rate Assumptions • Rate changes with three 5 year Ramp Up. Valuation Date Fiscal Year for Required Contribution Discount Rate June 30, 2016 2018-19 7.375% June 30, 2017 2019-20 7.25% June 30, 2018 2020-21 7.00% • Estimated impacts compared to 6/30/2015 valuation. Normal Cost UAL Payments Valuation Date Fiscal Year Impact Misc. Plans Safety Plans Misc. Plans Safety Plans 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 2018-19 2019-20 2020-21 2021-22 2022-23 0.25% - 0.75% 0.5% - 1.5% 1.0% - 3.0% 1.0% - 3.0% 1.0% - 3.0% 0.5% - 1.25% 1.0% - 2.5% 2.0% - 5.0% 2.0% - 5.0% 2.0% - 5.0% 2% - 3% 4% - 6% 10% - 15% 15% - 20% 20% - 25% 2% - 3% 4% - 6% 10% - 15% 15% - 20% 20% - 25% 6/30/2021 6/30/2022 2023-24 2024-25 1.0% - 3.0% 1.0% - 3.0% 2.0% - 5.0% 2.0% - 5.0% 25% - 30% 30% - 40% 25% - 30% 30% - 40% Revenues General Fund Five Year Forecast - Revenues Revenue Budget FY 16/17 E FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Property Taxes - Secured Property Taxes - CFD Property Taxes - Other Sales & Use Taxes Other Taxes EU Pilot Fees & Permits Property Tax in Lieu VLF Intergovernmental - Other Services Charges Fines & Forfeitures Use of Money Other Revenues Transfer In 9,505,250 0 355,290 11, 517, 970 4,402, 000 7,131, 330 91,080 4,903,500 680,830 1,218,980 1,136, 500 1,521,000 366,620 4,000,000 9,885,200 0 374,000 11,490,830 4,564,000 7,158, 850 98,820 5,018,600 600,410 1,500,330 1,445,000 1,553,370 384,500 4,295,640 10, 251, 000 244,300 382,000 11, 755, 000 4,646,000 7,195, 000 101,000 5,119, 000 601,000 1,051,000 1,445,000 1,587,000 403,000 4,477,000 10,631,000 370,400 389,000 11, 971, 000 4,744,000 7,231,000 103,000 5,222,000 601,000 841,000 1,445,000 1,621,000 409,000 4,668,000 11, 025, 000 466,100 397,000 12,196, 000 4,826,000 7,268,000 105,000 5,327,000 601,000 841,000 1,445,000 1,656,000 415,000 4,788,000 11, 433, 000 589,200 405,000 12, 432, 000 4,911,000 7,305,000 107,000 5,434,000 601,000 841,000 1,445,000 1,692,000 421,000 4,846,000 11, 857, 000 692,900 413,000 12, 669, 000 4,990,000 7,342,000 109,000 5,543,000 601,000 841,000 1,445,000 1,729,000 427,000 4,905,000 Total Revenue 46, 830, 350 48, 369, 550 49, 257, 300 50, 246, 400 51, 356,100 52, 462, 200 53, 563, 900 Revenue Growth N/A 3.3% 1.8% 2.0% 2.2% 2.2% 2.1% Expenses General Fund Five Year Forecast Cate • or Budget FY 16/17 E FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Salaries PERS Normal Cost PERS UAL Other Benefits Operations Debt Transfers Pension Stabilization (PARS) 20,731,010 6,681,790 0 6,688,340 10, 700, 690 1,001,850 2,302,090 2,830,210 20, 866, 650 2,708,300 4,660,130 6,984,450 9,844,550 1,002,070 2,303,400 0 21,180,000 2,953,000 5,686,000 7,160,000 10, 288, 000 1,002,250 2,315,000 0 21, 329, 000 3,184, 000 6,824,000 7,339,000 10, 751, 000 999,760 2,327,000 0 21, 436, 000 3,605,000 8,019,000 7,523,000 11, 235, 000 999,310 2,339,000 0 21, 544, 000 3,624,000 9,038,000 7,712,000 11,741,000 1,002,560 2,351,000 0 21, 652, 000 3,643,000 9,942,000 7,905,000 12, 270, 000 998,250 2,363,000 0 Total Ex • enditure 50, 935, 980 48, 369, 550 50, 584, 250 52, 753, 760 55,156, 310 57, 012, 560 58, 773, 250 Ex•enditure Growth N/A -5.0% 4.6% 4.3% 4.6% 3.4% 3.1 evenue - Ex•enditure 4,105, 630 0 1,326,950 2,507,360 3,800,210 4,550,360 5,209,350 Total Fund Balance 1 8 769 858 8 769 858 7 442,908 4 935 548 1,135 338 3 415 022 8 624,372 [1] Fund balance details inluded in a later slide. Fund Balance Cate • o Budget FY 16/17 E FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 DIVCA [1] Catastrophic Reserve [2] Economic Reserve [2] Unassigned Reserve 465,127 481,127 481,127 481,127 481,127 481,127 481,127 3,746,428 3,869,564 4,048,180 4,223,501 531,211 3,746,428 3,869,564 2,895,601 172,920 0 811,875 549,603 0 0 0 0 0 0 0 (4,113,149) (9,448,499) Total Fund Balance 8,769,858 8,769,858 7,424,908 4,877,548 1,012,338 3,632,022 8,967,372 [1] DIVCA is a reserved fund balance from revenues that are restricted to a limited purpose. [2] Per policy, this is set at 8% of revenue, catostrophic reserves are prioritize, then economic reserves, then unassigned. Impact of 1% Revenue Shortfall in FY 17/18 Cate • or Budget FY 16/17 E FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Revenues Expenses 46, 830, 350 47, 885, 855 48, 764, 727 49, 743, 936 50, 842, 539 51, 937, 578 53, 028, 261 50, 935, 980 48, 369, 550 50, 602, 250 52, 793, 760 55, 221, 310 57,106, 560 58, 899, 250 Revenue - Ex•enditure 4,105,630 483,696 1,837,523 3,049,824 4,378,771 5,168,982 5,870,989 Total Fund Blance 8 769 858 8 286 163 6 448 640 3 398 816 979 955 6 148 937 12 019 927 DIVCA Catstrophic Reserves Economic Reserves Unassigned Reserve 465,127 481,127 481,127 481,127 481,127 481,127 481,127 3,746,428 3,830,868 3,901,178 2,917,689 0 0 0 3,746,428 3,830,868 2,066,334 811,875 143,299 0 0 0 0 0 0 (1,461,082) (6,630,064) (12,501,054) Total Fund Balance 8 769 858 8 286 163 6 448 640 3 398 816 979 955 6 148 937 12 019 927 Cumulative Fund Balance Im •act N/A 483 696 976 269 1 478 732 1 992 293 2 516 915 3 052 554 Impact of New Revenue Cate • o Budget FY 16/17 E FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Revenues Potential New Revenue[1] Expenses 46, 830, 350 48, 369, 550 49, 257, 300 50, 246, 400 51, 356,100 52, 462, 200 53, 563, 900 N/A N/A 2,644,875 5,386,950 5,488, 200 5,594,400 5,701,050 50, 935, 980 48, 369, 550 50, 602, 250 52, 793, 760 55, 221, 310 57,106, 560 58, 899, 250 Revenue - Ex•enditure 4,105,630 0 1,299,925 2,839,590 1,622,990 950,040 365,700 Total Fund Blance 8,769,858 8,769,858 10, 069, 783 12, 909, 373 14, 532, 363 15, 482, 403 15, 848,103 D I VCA Catstrophic Reserves Economic Reserves Unassigned Reserve 465,127 3,746,428 3,746,428 811,875 481,127 3,869,564 3,869,564 549,603 481,127 3,940,584 3,940,584 1,707,488 481,127 4,019,712 4,019,712 4,388,822 481,127 4,108,488 4,108,488 5,834,260 481,127 4,196, 976 4,196, 976 6,607,324 481,127 4,285,112 4,285,112 6,796,752 Total Fund Balance 8,769,858 8,769,858 10, 069, 783 12, 909, 373 14, 532, 363 15, 482, 403 15, 848,103 Cumulative Fund Balance Im • act N/A 0 2,644,875 8,031,825 13,520,025 19,114,425 24,815,475 [1] Based on estimated Local Sales Tax measure at half -cent approved in November 2018. New Revenue with 1% Revenue Shortfall in FY 17/18 Cate • or Budget FY 16/17 E FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 Revenues Potential New Revenue[1] Expenses 46, 830, 350 47, 885, 855 48, 764, 727 49, 743, 936 50, 842, 539 51, 937, 578 53, 028, 261 N/A N/A 2,618,426 5,333,081 5,433,318 5,538,456 5,644,040 50,935,980 48,369,550 50,602,250 52,793,760 55,221,310 57,106,560 58,899,250 Revenue - Ex•enditure 4,105,630 483,696 780,903 2,283,257 1,054,547 369,474 226,949 Total Fund Blance 8,769,858 8,286,163 9,067,066 11, 350, 322 12, 404, 869 12, 774, 343 12, 547, 394 DIVCA Catstrophic Reserves Economic Reserves Unassigned Reserve 465,127 3,746,428 3,746,428 811,875 481,127 3,830,868 3,830,868 143,299 481,127 3,901,178 3,901,178 783,582 481,127 3,979,515 3,979,515 2,910,165 481,127 4,067,403 4,067,403 3,788,936 481,127 4,155, 006 4,155, 006 3,983,204 481,127 4,242,261 4,242,261 3,581,745 Total Fund Balance 8,769,858 8,286,163 9,067,066 11, 350, 322 12, 404, 869 12, 774, 343 12,547, 394 Cumulative Fund Balance Im •act N/A 483,696 1,642,158 6,472,774 11, 392, 531 16, 406, 365 21, 514, 766 [1] Based on estimated Local Sales Tax measure at half -cent approved in November 2018. Assumes 1% less new revenue in FY 18/19 and beyond. Risks and Opportunities Risks Opportunities PERS UAL/Other changes Recession Economic Development Revenue Enhancement Labor agreements Cost of Services Cost recovery studies