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Home My WebLink About061620-08.02 BUDGET POWERPOINT2020/21 Budget & Capital Improvement Program June 16, 2020 1 Actions for Consideration Resolution 35-2020 – Approving the 2020/21 Operating Budget and Appropriation Limit; Resolution 36-2020 – Approving the Five-Year CIP and appropriating funds for 2020/21 capital projects; Resolution 37-2020SA - approving the 2020/21 Operating Budget for the Successor Agency; Resolution 38-2020 – Approving the 2020/21 Master Fee Schedule 2 Budget/CIP Process and Purpose Process Draft Budget & CIP posted on Town website on May 21 3 Public Study Sessions - May 26, June 2 and June 9 Purpose Establish/review highest priorities for municipal service delivery to meet unique community needs Identify, plan for and fund one-time capital needs I’D LIKE TO THANK/RECOGNIZE LANI, NAT, STEVEN, FINANCE STAFF AND DEPT HEADS FOR THEIR CONTRIBUTIONS TO THIS EFFORT. SO, TONIGHT IS 4TH PUBLIC MEETING HELD TO REVIEW AND CONSIDER BUDGET & CIP 3 Danville’s Approach = Fiscal Sustainability Mission is to deliver superior municipal services that make people’s lives better Combine approaches to deliver service Invest in partnerships and technology Don’t borrow… maintain healthy reserves Estimate conservatively 4 Impact of Covid -19 Coronavirus (Covid-19) pandemic is unprecedented in recent history; California cities face severe revenue shortfalls due to the impact of Covid-19 on their economies; *California Cities anticipate a nearly $7.0 billion general revenue fund shortfall over the next two fiscal years; *League of California Cities Data and Assumptions 5 Impact of Covid -19 6 Impact of Covid -19 upon Budget Process Process delayed Revenue forecasts developed based upon best currently available information Need to consider a range of revenue scenarios Need to consider options to re-balance the budget with less revenue 7 Impact of Covid -19: Major Revenues Impacted Sales Tax Recreation Fees & Charges HUTA (Gas Tax) Measure J RTS Building and Planning Transient Occupancy (Hotel) Tax 8 Impact of Covid -19 upon Total Revenues 2019/20 Budget $36,597,954 2020/21 Pre-Covid $37,105,251 2020/21 Post-Covid Scenario 1 $34,162,131 -$2,943,121 -7.9% Scenario 2 $32,075,580 -$5,029,671 -13.6% Scenario 3 $30,057,824 -$7,047,428 -19.0% 9 Modified Budget Approach Budget based upon Scenario 2 -$5.0 million revenue Full impact is still unknown; will be ongoing and fluid throughout 2020/21 Identifies reductions in expenses and fund transfers to balance the budget Maintains reserves as added contingency 10 2020/21 Revenue Forecast Town 2019/20 2020/21 +/- General Fund $ 27,091,684 $23,963,524 -11.5% Special Revenue $ 9,506,270 $ 8,112,057 -14.7% TOTAL TOWN $36,597,954 $32,075,581 -12.4% Successor Agency $ 2,280,575 $ 2,279,212 NC GRAND TOTAL $38,878,529 $34,354,793 -11.6% 11 Major Revenues – General Fund 2019/20 2020/21 +/- Property Tax $14,505,222 $14,505,222 NC Sales Tax $ 5,577,220 $ 4,339,328 -22.2% Recreation Fees $ 2,576,145 $ 1,351,262 -47.5% Franchise Fees $ 2,326,932 $ 2,280,969 - 2.0% All Other $ 2,106,165 $ 1,486,743 -29.4% TOTAL $27,091,684 $23,963,524 -11.5% 12 Major Revenues – Special (Restricted) 2019/20 2020/21 +/- LLAD $ 3,120,682 $ 3,129,750 NC Building & Planning $ 2,212,200 $ 1,787,458 -19.2% Gas Tax $ 1,919,117 $ 969,080 -49.5% Measure J RTS $ 815,217 $ 576,288 -29.3% Clean Water $ 572,700 $ 572,710 NC Solid Waste VIF $ 482,182 $ 585,000 21.4% All Other $ 384,173 $ 491,771 28.0% TOTAL $ 9,506,271 $ 8,112,057 -14.7% 13 2020/21 Recommended Expenditures/Transfers 2019/20 2020/21 +/- Town $33,596,071 $30,978,161 - 7.8% Successor Agency $ 1,180,575 $ 1,179,212 NC Total Expenditures $34,776,646 $32,157,373 - 7.5% Fund Transfers $ 4,685,005 $ 2,570,240 -45.0% TOTAL $39,461,651 $34,727,613 -12.0% 14 Expense by Department 2019/20 2020/21 +/- General Government $ 2,082,094 $ 1,864,513 -10.5% Police $10,267,608 $10,132,889 - 1.3% Administrative Services $ 4,071,336 $ 3,796,878 - 6.7% Development Services $ 4,972,431 $ 3,804,345 -22.6% Maintenance Services $ 7,867,415 $ 7,362,710 - 6.4% Recreation, Arts & C.S. $ 4,335,187 $ 4,016,826 - 7.3% TOTAL $33,596,071 $30,978,161 - 7.8% 15 Expense by Category 2019/20 2020/21 +/- Employee Expenses $12,565,100 $11,288,843 -10.2% Temporary Salaries $ 1,092,010 $ 787,542 -27.9% Administration $ 645,227 $ 521,647 -19.2% Materials & Supplies $ 1,440,577 $ 1,388,093 - 3.6% Contracted Services $13,059,851 $12,573,142 - 3.7% Equipment $ 887,926 $ 686,259 -22.7% Program Activities $ 3,905,380 $ 3,732,635 - 4.4% TOTAL $33,596,071 $30,978,161 - 7.8% 16 Service Level Impacts General Total Staffing reduced from 161 to 141 FTE (-12.4%) Hours of operation reduced from 42.5 to 38.5 (-9.4%) Police Department Reduced public counter assistance, parking enforcement and investigation follow-up on “C” cases Development Services Increased response/turnaround time for permit applications dept.-wide; increased response time for PW inspections; increased design/development time for CIP projects 17 Service Level Impacts Administrative Services Eliminated replacement of vehicles, technology purchases and upgrades impacting service delivery town-wide. Maintenance Services Increased response time for CRM requests and park repairs; reduced funding for plant replacement and upkeep of buildings. Recreation, Arts and Community Services Reduced funding and staffing for all programs, classes, events and activities; reduced availability of buildings for public use. Reduced funding for Library Services and Community Events 18 Ten-Year Forecast Revenues < by $16.9 million or $1.7 million/yr. Expenditures < by $11.1 million or $1.1 million/yr. Transfers < by $11.2 million or $1.1 million/yr. Sales Tax – 4 year recovery HUTA and Measure J RTS – 2-3 year recovery Recreation Fees – 1-2 year recovery LLAD Adjustment will be required 19 Master Fee Schedule Town adopts a Master Fee Schedule for User and Cost Recovery Fees Fee Schedule is reviewed annually 2020/21 Master Fee Schedule increased by 2.9 % for CPI adjustment 20 Proposition 111 Appropriation Limit Appropriation limit set by Prop 4 (1979) and Prop 111 (1990) - limits amount of General Fund revenue that can be appropriated in any fiscal year. Applies to proceeds of taxes only 2020/21 limit is $43.7 million Actual 2020/21 G.F. revenues subject to limit is $20.12 million Danville is well below the limit 21 Summary – Budget & CIP 2020/21 Budget is balanced; expenses/transfers reduced by $4.72 million from 2019/20 Some service level reductions due to Covid-19 Operating reserve equivalent to 38.3% of total Operating Budget; 54% of G.F. Budget (minimum 20% required) Town has no unfunded pension or OPEB liabilities Funds 16 capital projects totaling $2.45 million - no debt Continuing on a fiscally sustainable course 22 Recommendation Adopt Resolution 35-2020, approving the 2020/21 Operating Budget and Appropriation Limit Adopt Resolution 36-2020, approving Five-Year CIP and appropriating funds for 2020/21 capital projects Adopt Resolution 37-2020SA, approving the 2020/21 Operating Budget for the Successor Agency Adopt Resolution 38-2020, approving the 2020/21 Master Fee Schedule 23 24