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Home My WebLink About2008 06-10 CC CDC ADJ MINBook 90 / Page 125 06-10-2008 MINUTES OF THE ADJOURNED REGULAR MEETING OF THE CITY COUNCIL AND COMMUNITY DEVELOPMENT COMMISSION (BUDGET WORKSHOP) OF NATIONAL CITY, CALIFORNIA June 10, 2008 The Adjourned Regular Meeting of the City Council and Community Development Commission of National City was called to order at 6:05 p.m. by Mayor / Chairman Ron Morrison. ROLL CALL Council / Commission members present: Morrison, Natividad, Parra, Ungab, Zarate. Administrative Officials present: Babaki, Baker, Dalla, Deese, Duong, Eiser, Garcia, Gonzales, Hodges, Juniel, Ladrido, Post, Raulston, Smith, Stevenson, Williams, Zapata. Others present: City Treasurer George Hood. CITY COUNCIL AND COMMUNITY DEVELOPMENT COMMISSION 1. SUBJECT: Presentation and Request by the Boys & Girls Club of National City for Financial Support in the Amount of $250,000. TESTIMONY: Allie Pruitt, Boys & Girls Club President and Johanna Gordy, Boys & Girls Club Representative, made a presentation and requested financial support in the amount of $250,000. ACTION: Action was deferred until after the Budget presentation by the staff. 2. SUBJECT: Review of City Manager's Proposed FY 2008-2009 Preliminary Budget for City and Community Development Commission — City Council Finance Committee. STAFF PRESENTATION: City Manager Chris Zapata reviewed the project and budget highlights, Finance Director Jeanette Ladrido the City's financial condition and proposed CIP budget, CDC Executive Director Brad Raulston review the CDC Budget and Assistant City Manager Leslie Deese highlighted individual departmental budgets. Copy of presentation on file in the Office of the City Clerk. (See attached Exhibit 'A') TESTIMONY: None. Book 90 / Page 126 06-10-2008 2. SUBJECT: Review of City Manager's Proposed FY 2008-2009 Preliminary Budget (continued). ACTION: Motion by Parra, to approve $20,000 per month payments in the new budget for the Boys & Girls Club. Died for lack of a second. Mayor Morrison suggested that payments be made quarterly. Motion by Natividad, to approve $50,000 for the Community Youth Athletic Association. Motion died for lack of a second. Motion by Natividad, to approve $15,000 for the teen center at Casa Salud. Motion died for lack of a second. Motion by Natividad, to approve $5,000 for both Senior Center groups. Motion died for lack of a second. Motion by Natividad, to approve $1,000 for every youth baseball and airls softball league. Motion died for lack of a second. Motion by Parra, second by Zarate, to direct staff to include in the preliminary budget $20.000 Der month for the Bovs and Girls club to be paid quarterly: Bovs & Girls Club Board to prepare a business plan with funding to be re-evaluated after the November election. Member Zarate requested clarification on the motion and if the amount was sufficient. Mayor Morrison clarified that the $20,000 is basicallv the monthly amount for the requested $250,000 which is to be paid upfront on a Quarterly basis beginning in July and then October. Carried by unanimous vote. ADJOURNMENT ACTION: The meeting was adjourned to the next Regular Meeting of the City Council and Community Development Commission to be held Tuesday, June 17, 2008 at 6:00 p.m., Council Chamber, Civic Center. The meeting closed at 7:56 p.m. City Clerk / RecoFding Secretary The foregoing minutes were approved at the Regular Meeting of August 5, 2008. Mayor / CDC Chairman TAPE RECORDINGS OF EACH CITY COUNCIL AND COMMUNITY DEVELOPMENT COMMISSION MEETINGS ARE AVAILABLE FOR SALE IN THE CITY CLERK'S OFFICE. EXHIBIT 'A' Preliminary Budget Presentation Fiscal Year 2008-2009 �--F CALIFORNIA -+ NNTIONAL arr. anal CORPORATE City of National City June 10, 2008 City Manager Budget Overview Budget is developed annually with Council, community and staff input 2008/2009 Budget includes many funds which are currently healthy General Fund had a structural deficit temporarily fixed by 10-year district tax Budget must plan for two scenarios (maintain district tax, repeal of district tax) Repeal means Toss of approximately $4 million this year- estimated at $70 million total Sales & District Tax Overview ' ra Of 8.75% total sales tax, State receives 5%, County 1.75%, City receives 2% Of City's 2%, 1 % is the district tax and cannot be raided by the State The district tax does not apply to food, medicine, rent, utilities or mortgages Unlike property, utility or parcel taxes, the district tax is paid by visitors The district tax does not apply for non-residents to cars, planes, boats or automobile sales per state law All customers pay district tax on parts and service Budget Highlights Continued commitment to public safety, senior citizens, revenue diversity & facility repairs Continue building one time reserves for contingency use and aggressively seeking grants Emphasis placed on neighborhoods, quality of life, community engagement $2 million in new ongoing revenue to General Fund over next 24 months to lesson estimated $7 million structural deficit Provide $1 million to pay down Nutrition Center obligation per audit In event of district tax repeal staff is prepared for service cuts in December Project Highlights Paradise Village construction 498 units largest residential project in City history 170 Room Marina Gateway Hotel Plaza Bonita Mall — Target and mall expansion completion $8 million dollar street paving program Quality of life improvements including Soccer Field & Skate Park, Port District Marina Financial Condition State of California's 17.2 Billion State shortfall may impact to local government subventions & grants National City is in good financial condition in difficult times _J Clean financial audits _J Standard & Poors Rating = A- � Pursue revenue enhancements and diversity � Limited General Fund Debt _J Bonding capacity available for CDC City of National City FY 2008-2009 Budget GENERAL FUND FY 08-09 Proposed General Fund Budget e,, Estimated Revenues $39,212,371 Deduct: Estimated Expenditures ($37,954,574) Subtotal of Revenues over Expenditures 1,257,797 Add/Deduct Operating Transfers: Library Fund (1,062,429) Parks Maintenance Fund ( 367,131) General Plan Reserve ( 250,000) Nutrition Center ( 286,907) Gas Tax Fund 700,000 CDBG Fund 202,137 Capital Needs (Engineer's Estimate) UNFUNDED C.I.P. (4,000,000) (3,806,533) General Fund Revenue Assumptions Property Tax Revenue to increase 5.1% Sales Tax Revenue to increase 5.5% District Tax Revenue to increase .5% Transient Occupancy Tax Revenue to increase 5.5% Investment Earnings to decrease 9.6% Overall Average Increase 2.2% Top 5 FY 08-09 General Fund Revenues Sales Tax District Tax Property Tax in Lieu of VLF Property Tax in Lieu of Sales Tax Property Tax 12.3 million 8.6 million 5.0 million 4.1 million 3.2 million TOTAL GENERAL FUND $ 39 MILLION Sales Tax Assumptions Auto/Transportation will continue to decline Building/construction will continue to decline General & consumer goods slightly increase due to the following additions: Borders AMC Theater Target Additional stores/restaurants at Plaza Bonita Does NOT include: Marina Gateway development District Tax Assumptions Full year of District Tax If District Tax is repealed in November, FY 08/09 revenue will be reduced by 50% Projection includes the Plaza Bonita expansion Borders AMC Theater Target Additional stores/restaurants 10 Year Sales Tax and District Tax History Sales Tax and District Tax supports over half of the City General Fund operations 25 20 15 10 5 0 rrrninuui 00 01 02 03 04 05 06 07 08 09 ■ Sales Tax ® District Tax District Tax Budget vs Actual 9 .2 8 7 6 5 4 3 2 1 0 07 08 ■ Budget k Actual 09 10 Year History (without District Tax DISTRICT TAX 01 02 03 04 05 06 07 08 09 Revenue ---- Expenditure 45 40 35 30 25 20 15 10 5 0 10 Year History (with District Tax DISTRICT TAX 01 02 03 04 05 06 07 08 09 Revenue - with 1% tax Expenditure 45 40 35 30 25 20 15 10 5 0 City of National City FY 2008-2009 Budget PROPERTY TAXES 10 Year History of Property Taxes 0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 03 04 05 06 07 08 09 Assessed Values - 08/09 Year Temporary Market Reductions have been calculated by the Assessor's Office National City reduction = 2% of total assessed value Overall Assessed Values Increased by 5% Final totals will be provided by June 30, 2008 Assessed Values - 2004 to 2009 09 08 07 06 05 04 0 500 1000 1500 2000 2500 3000 3500 Millions City of National City FY 2008-2009 Budget EXPENDITURES General Fund Expenditure Assumptions Overall increase of 3% Maintenance & Operation Increases (i.e. Fuel) Labor agreements implementation Debt Service = Increase based on debt schedule Program Changes recommended by City Manager Capital Projects = Engineer's estimated General Fund Capital Needs at $ 4 million General Fund Expenditures (Ranking by dollar amount) Police 20.7 million Fire 7.2 million Public Works 1.9 million Community Services 1.7 million Planning and Building 1.5 million Engineering 1.1 million Non -Departmental 1.1 million All other 2.8 million Total General Fund 38 million 4h;#a "reo 4e44,„‘. 0 4*9 Witteetee City of National City Fiscal Year 2008-2009 GENERAL FUND FUND BALANCE General Fund - Fund Balance General Fund Reserve Policy states: ... a minimum target range equal to between 25% and 50% of a single year's General Fund operating expenditures" Begin FYO7-08 with $7.3 million in General Fund Contingency Reserve Additionally, General Fund Undesignated Fund Balance is 7.4 million Total fund "savings" is 14.7 million General Fund Reserves 20 18 16 14 12 10 8 6 4 2 0 03 04 05 06 07 08 09 ■ Designated for Contingencies Undesignated Fund Balance i Reserved Fund Balance City of National City REVENUES -ALL FUNDS Other Revenue, All Funds (Ranking by Dollar Amount) General Fund $ 39.2 million Tax Increment — CDC Debt Service $ 12.2 million Section 8 $ 8.4 million Sewer Service Charges $ 7.1 million Proposition A $ 4.7 million Low & Moderate Income Housing $ 3.2 million SAFETEA-LU $ 2.3 million Gas Taxes $ 1.2 million CDBG Grant $ 1.1 million All other Funds $ 17.4 million 1 CTAL. REVENUES $ 96.8 million Community Development Commission REVENUE PROJECTIONS Tax Increment Revenue Assumptions 3% growth from FY 08 Amount may be conservative Excludes Marina Gateway Hotel ESTIMATED REVENUE 15.2 MILLION Revenues & Expenditures DESCRIPTION Estimated Gross Tax Increment Less: 20% Set Aside Net Tax Increment Less: Debt Service Payments Pass Through .Payments Amount Available for Redevelopment Activities Less: Administrative Expenditures Amount Available for Redevelopment Projects Less: Redevelopment Projects ADD'L FUNDING FR DEBT SERVICE FUND 15,227,888 (3,045,578) 12,182,310 (3,526,834) (1,836,897) 6,818,579 (5,917,888) 900,691 (4,373,000) (3,472,309) Debt Service Fund Expenditures Debt Service Payments 1999 Tax Allocation Bond 2004 Tax Allocation Bond 2005 Tax Allocation Bond Total Debt Service Payments Pass Through Payments County of San Diego Southwestern College Office of Education City of National City Other organizations* Total Pass Through Payments TOTAL EXPENDITURES 329,803 491,348 2,705,683 3,526,834 1,090,234 301,746 326,063 35,324 83,530 1,836,897 5,363,731 Tax Increment Expenditures (excludes Capital Improvements) Department/Activity Amours City Council 74,034 City Clerk 103,785 City Manager 178,127 Finance 400,515 City Attorney 264,831 Planning & Building 232,484 Human Resources 53,064 General Services 33,165 Management Information Systems 94,070 Engineering 143,872 Community Development 4,339,941 TOTAL EXPENDITURES 5,917,888 Recommended Modifications Tax Increment Fund Planning Department City Council 48,000 5,100 �►- CALIFORNIA -» NATIONAL cI INCORPOSATD mpact of District Tax Repeal Effective cut-off 30 days after Election resulting in estimated $4 million loss in 2008/09 Estimated loss of $70 million over life of Measure Reduced Services, Programs & Staffing Diminished Response Time/Productivity Levels No Funding for Capital Projects Budgets Without M&O Increases Mayor/City Council City Manager General Services City Treasurer Engineering Library Community Services With Sudgets &p easE Mr cty Oeck S,nance City Pttorney Nurnan gesources epa,�,menta1 Non O police Fire ‚s. Pub\ic Operations 2008 Municipal Election Costs Advertising Costs Various decreases Records Management Training 21,000 14,000 (10,840) 70 Rentals & Leases 250 TOTAL INCREASE $ 24.480 Postage/Office Supplies 1,030 TOTAL INCREASE 1,030 City Attorney Excess Liability Insurance 38,197 TOTAL INCREASE $38,197 Human Resources I\utomat Online Application 13,000 System TOTAL INCREASE $13,000 Non -Departmental Postage Memberships & Subscriptions Training Pepper Park Port Concert Sister Cities "Call 211 San Diego" Emergency System National City Community Concert Band Provision for Contingency 7,700 12,465 562 7,500 120 12,223 14,500 260.115 TOTAL INCREASE $315,185 Police Contract Services 93,681 Wearing Apparel 450 Parking Enforcement 65,000 RCS Principal & Interest Payments 39,024 Patrol/Crime Lab/Prop Supplies 8,000 TOTAL INCREASE $206,155 Fire RCS Principal and Interest Contract Services 1 ' I PP' 12,472 23,016 TOTAL INCREASE $ 35,488 M.I.S. Telecom Revolving Fund (PC's for Police Department) 55,000 TOTAL INCREASE $55,000 Public Works Operations RCS Backbone Principal & Interest 17,099 Streets Street Lights & Signals 8,040 Repairs & Maintenance — Traffic Control Devices 1,050 Facilities Division Electricity & Gas 254,383 Water 32,000 Repairs/Maintenance, Building/Structures 36,500 Electrical Materials 5,000 Chemical Products 3,400 Equipment Division Fuel 150,000 Repairs & Maintenance — Automotive Equip 2,000 Repairs &Maintenance — Fire Equip 200 TOTAL INCREASE $ 509,672 City of National City FY 2008-2009 Preliminary Budget CAPITAL IMPROVEMENT PROGRAMS Capital Improvement Program (CIP) Assumptions Engineers Estimate of General Fund CIP Needs is $4 million Prior years' CIPs are still funded and therefore, are not listed in the current budget Staff is in process of reviewing/verifying funding of all CIPs Planning Commission will review the FY 08- 09 CIPs June 16, 2008 for consistency with General Plan Capital Improvement Program Listing DESCRIPTION FUNDING SOURCE AMOUNT Safe Routes to School General Fund 100,000 Grant 900,000 Resurface Streets Proposition A 4,674,000 Traffic Congestion Relief 586,265 Plaza Blvd Widening Transportation Impact Fees 378,300 Traffic Collision Office of Traffic Safety 132,000 System Capital Improvement Program Listing DESCRIPTION Marina Gateway Improvements SAFETEA-LU Tax Increment Highland Ave Transportation/Tax Resurfacing Increment 2,000,000 Imaging/Document Office Equipment Retrieval System Depreciation 63,000 Internet access, Telecommunications email, intranet Revolving 45,000 OUNT 2,390 000 2,373 000 Capital Improvement Programs - By Category Traffic Control 4% Technology 1% Transportation 95% Vehicle C.I.P. Program General Fund: Police — 2 police cars Public Works Sweeper Air Compressor Sewer Fund: Public Works Emergency Generator Trash Pump Parks Fund: Public Works Brush Chipper 80,000 200,000 30,000 45,000 30,000 30,000 TOTAL REQUEST $415,000 City Manager Recommended Modifications General Fund City Manager Fire Operations Public Works Neighborhood Council Engineering Budget Non -Departmental Vehicle CIPs ( 7,350) ( 4,620) ( 300) (12,150) (12,150) ( 8,000) 310,000 TOTAL MODIFICATIONS $ 265,430 City Manager Recommended Modifications Tax Increment Fund Planning Department City Council 48,000 5,100 Sewer Fund Public Works —Vehicle CIP 75,000 Parks & Recreation Capital Outlay Fund Public Works —Brush Chipper 30,000 Updated Fund Balances FUND General Fund Sewer Fund Parks Capital Outlay Fund Tax Increment Fund PRELIM REVISED AMOUNT AMOUNT $ 6,504,245 $ 6,238,815 $ 707,393 $ 632,393 $ 17,658 $ 887,658 $ 3,265,608 $ 3,212,508 - CALIFORNJA .-E. NATIONAL el as� v , NCORPORATED Next Steps Preliminary Budget Adoption June 17, 2008 Final Budget Adoption August/September 2008 ��Foar�A - IO eiConcluslOfl INCORPOBAT� l City Manager Recap Questions/Comments