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SR-CC/HA/PC-2 c C 11IA-(fJA - '- FED 2 5 1997 eM KEL ckl flnance\adrnln\stfrprt\revexpd Council Meeting February 25, 1997 Santa Momca, Cahfornia TO Mayor and City Council Chairperson and Housmg Authority Members Chairperson and Parking Authonty Members FROM CIty Staff SUBJECT RecommendatIon to Conduct FY1996-97 MId-Year Budget RevIew and Adopt AssocIated Budget and Fee Changes Introduction This report provides a mid-year review of the 1996-97 budget, recommends technical, personnel and fee changes and reports on progress on work objectives Backaround The mId-year budget revIew IS an opportUnity to assess the status of the adopted budget and make necessary course corrections In addition to revIewing projected revenues and expendrtures after SIX months of operations, staff evaluates progress on collaborative and departmental objectives RevIsions to the adopted budget are recommended based on thiS analysIs and the availability of the latest InformatIon and data DISCUSSion A summary review of all funds IS at ExhIbIt A. There WIll be no slgmficant change In any fund balance as a result of the actions proposed In thIS report The Impact on the General Fund balance of the recommended budget changes, prevIously adopted budget changes 1 FEB 2 5 1997 eel HlJ-I PI! - 2.. - and the projected transfer of $3 8 mIllion to augment the set-asIde for constructIon of the Pubhc Safety FacIlity IS shown below $ 147 - Audited beginning Fund Balance for FY1996-97 1333 - FY1996-97 Estimated Actual Revenue ( 124 4) - FY1996-97 Revised Expenditure Budget* ( 49) - FY1996-97 Revised Net Balance Sheet Transfers** ( :,3 8) - Projected Transfer to Public Safety FacIlity Construction Reserve $ 149 - Projected Ending Fund Balance for FY1996-97 * Reflects adopted budget for FY1996-97, Council approved changes through 12/31/96, changes recommended by thiS report, less reappropnated capital which IS financed from other designated reserves ** Reflects adopted budget for FY1996-97 and changes recommended In thiS report Details of the previously approved budget actions and the mid-year analysIs of revenues are contained In Exhibit B As IS the City'S practice, an analysIs Will be prepared at the end of the fiscal year to IdentIfy changes in any of the fund balances as well as any final expenditure savmgs or budget reVISIons that are necessary Operating Budget Review - Recommended budget transactions are outlined In Exhibits 2 C, D and E Revenue adjustments will more accurately reflect grant funds the City wIll receive dunng the fiscal year These revenue changes are necessary so that corresponding expenditures can be InitIated In addItion to proposed techmcal adjustments, a number of sIgnificant expenditure budget changes are recommended . A proposed $125,000 loan from the General Fund to the Pier Fund to replace $75,000 of underreahzed lease revenue and to make a $50,000 loan to the PRe for enhanced Pier marketing and facIlity planmng . ServIce Improvements by the Big Blue Bus will be faCIlitated by the addition of 15 motor coach operators and assocIated support staff Those Improvements are outlined In a separate Item to be considered on thiS agenda . Budget changes are also proposed to strengthen mternal servIces to support Important City InitIatives ThiS report recommends the additIon of 4 staff positIons In Personnel and Information Systems, to better support the organization's use of technology and to speed the recruitment and selection of qualified staff Departmental Program Performance Review - Staff also revIewed departmental program performance and collaborative objectives With the exception of work objectives listed at Exhibit F, all collaborative and departmental work: objectives and performance measures are on target 3 Capital Improvement Projects (CIP) Review - A CIP Status report as of December 31, 1996 accompanies this staff report It presents Information on project ImplementatIon, financial status, management responsibility and changes In the scope or cost of project work authonzed All projects authonzed In the FY 1996-97 revised budget are listed, as well as those projects from pnor years which were not completed by June 30, 1996 Personnel Actions - Included at Exhibit G IS a resolutIon revIsing salaries for vanous posItIons These salary changes result from an analysIs of similar posItions In comparable CItIes and Internal equity factors The cost of these changes Will be absorbed In the eXisting budget Also at Exhibit G IS a listing of new positions and reclassifications which have been revIewed and approved by the CIty Manager, Personnel Director and Personnel Board as well as reclassifications which have already been approved by Council but which only need to be Incorporated Into the FY 1996-97 City budget at thIS tIme No appropnatlon change IS reqUired to Implement any of these changes Purchases Required to be Reported to Council Pursuant to Ordinance #1743 - City procurement procedures require competItIve biddIng, but also authorize the City Manager to secure necessary resources on an expedited basIs If an emergency anses, or If It IS In the mterest of pubhc health and safety If the City Manager exercises thiS authonty, It must 4 be reported to the Council Applicable purchases since July 1, 1996 are listed at Exhibit I Fee Increase for Adult Rides on Carousel - Approval of the resolution at ExhIbIt J wIll Implement the recommendatIon of the PRC to Increase the fee for adult carousel ndes from $ 50 to $1 00 This fee has not changed since 1986, and the Increase will enable the Carousel to be self-supporting The $1 00 fee would stili be slgmficantly below adult ndes fees for all other carousels In the general area No budget actIon IS necessary because the Increased fee was anticIpated when the FY 1996-97 budget was adopted Recommendations It IS recommended that the CIty CouncIl, Housing Authonty, and Parkmg Authority approve the resolutions at Exhibit H which recommend the revenue and expenditure budget changes noted In thiS report and the attached exhibIts Staff also recommends that the City CounCil adopt the changes In lob claSsIfications and approve the salary resolution contamed In ExhIbIt G, and approve the fee Increase resolution at ExhibIt J. 5 ~ Prepared By Susan McCarthy, Assistant City Manager Mike Dennis, Director of Finance Karen Bancroft, Director of Personnel Ralph Bursey, City Treasurer/Revenue Manager DavId Carr, AssIstant CIty Treasurer John Karclc, Budget Manager Joan Akins, Administrative Services Officer Katie lIchtlg, Semor Management Analyst EXHIBIT A- FY 1996-97 Revenue and ExpendIture AnalysIs by Fund B- FY 1996-97 RevIsions to Adopted Revenue and Expenditure Budget (7/1/96-12/31/96) and FY 1996-97 Mid-Year Revenue AnalysIs C- Proposed Changes to FY 1996-97 Revenue Budget D- Summary of Proposed FY 1996-97 Appropnatlon Increases/(Reductlons) E- Summary of FY 1996-97 Transfers ReqUiring City CounCil Approval (No Net Budget Impact) F- Exception Report on Work Objectives -- G- Resolution Containing Recommended Salary Changes for Certain PosItions, and a Listing of PosItion ReclasSifications and Previously Approved ReclaSSifications Requiring CounCil Approval for Incorporatlon Into the Budget .-"" H- e .B~dget Resolutlon0 I - listing of Procurements ReqUired to be Reported Pursuant to Ordinance #1743 J - A Rassk;tion of the CIty Cetm~!! ')f The City of Santa MOnica Revlsln~ The C:=Rldefe:~he~i1~;t:~~~ ~ tJy ~//IIJ(( 6