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Home My WebLink AboutFY 2010-2011 Proposed Budget - Budget Presentation Overview 8/2/2010 City of Huntington Beach Proposed Budget FISCAL YEAR 2_oio/ii FY 201o/i1 Budget Presentation Overview 2 • Beginning Challenges • PARS • FY 2010/11 Proposed Budget • Five-Year Financial Plan • Financial Reserves • Challenges Ahead 8/2/2010 y � $ Challenges �i • Two years of sustained recession of global and local economy ® State raids of local government revenues Over $20 million in expenditure reductions over past twenty-four months • $ 3 million budget challenge for FY 2010/11 identified in March 2010 ® Timing of PARS program enrollment relative to budget development Budget fatigue I 2 s/z/zolo rfr j W + sP 3 .s v PARS Basics ® Retirement Incentive Program offered to miscellaneous and marine safety employees 103 participants enrolled in the program with retirement to commence by 9/30/2010 o Approximately go participants from the General Fund 3 8/2/2010 Preliminary PARS Impact ® 103 PARS participants • 28 positions to be replaced full-time ® 20 positions to be replaced by contract ® 6 positions to be replaced temporarily ® 3 positions to be replaced with lower classification ® Departments reevaluating their future organizational structure o Will report back to City Council August 16, 2010 Net reduction in workforce 66 positions d PARS � 8i • With that many participants, the City should realize significant savings, right? o Yes,but not immediately) $11 million total savings by FY15/16 FY 2010/11 Salary S6 612 323 $6 612 323 $6 678 446 S6 745 231 $6 812 683 S6 88o 810 I Savings Less Replacement/ (3 207 900) (3 226 005) (3 270 16) (3 323 430) (3 377 278) (3 432 076) Contract Lessassumed (i 000 000) attntzon Annuity (1 324 830) (1 324 830) (1 324 830) (1 324 830) (1324 830) Payments Financial Reserves (834 588) (834 588) Payback(2 years) Savings Remaining $245 005 1 $1 226 goo 92 o83 10o I $2 o96 971 I S2 110 275 1 $3 448 734 A.W.ty payment completed to M5116 4 8/2/2010 x.cf 9 9 � r r FY 2010/11 Proposed Budget 10 , • Proposed budget totals $301,386,077, a $3 million decrease from the Adopted FY 2009/10 budget • The Proposed General Fund budget totals $178,188,548, a $3 1 million decrease from the Adopted FY 2009/10 budget 182 000 000 $181 333 841 180 000 000 $178 188 548 178 000 000 176 000 000 -- FY 20o9/lo Adopted FY 2oio/u Proposed Budget Budget m General Fund Revenue o General Fund Expenditures 41 IA 8/2/2010 General Fund by Department Police Fire Y x i T ' Non Departmental Public Works Community Services Planning&Building Information Services Human Resources Elected Officials F==1 Library Services Finance p Administration 8 z Econ Development P $ $20 000 $40 000 $6o 000 ®2010/2011 Proposed Budget 2009/2016 Adopted Budget General Fund Revenues 12 • Per Proposition 13, assessed value changes according to the CPI (at October), including any decreases o The CPI in October 2009 was negative, resulting in a decrease in assessed value effective January 1, 2011 • Slight increases in sales and transient occupancy taxes indicating a cautious increase in tourism and retail • Increase over the current year In "triple-flip" reimbursement due to the State funding what was owed in FY 2009/10 • Modest gains in Licenses & Permits relating to development 6 8/2/2010 General Fund Expenditures �3 • Continue budget reductions made in FY 2009/10 • Include all recently approved labor concessions o Approximately$2 3 million • Required additional operating reductions from all departments to address initial budget gap o Approximately$3 million New Reductions \ 4 • In addition to vacancies created by PARS, 22 positions from various departments are proposed to be eliminated o Non-PARS participants 6 positions • Proposed eliminations determined by each department's review of their operations and ability to perform with minimal service reduction • Without PARS, 22 filled positions would need to be eliminated 4k d 7 8/2/2010 Filled Positions Impacted � 5 � Of the 22 positions to be eliminated there are 6 non PARS participants K Project Manager Assistant Community Services Office Assistant I City Clerk GIS Analyst I Information Services Information Systems Analyst I Information Services Neighborhood Preservation Manager Planning&Building Senior Vehicle Body Technician Public Works Filled Positions Impacted � 6 � • Information Systems Analyst I&GIS Analyst—GIS team reduced from 5 to 3 positions GIS-based program and service level analysis will be reduced for Fire and Public Works and the cycle time for updates and distribution of maps for all city departments will increase • Office Assistant I —automation,including the implementation of electronic records management,electronic agenda process and production,and electronic filing of candidate contribution forms has made the clerical duties of this position unnecessary For the last 8 months,the position has been utilized in the Clerk s office for only 1/2 day and then loaned to another department in order to maintain a sufficient workload for this position 5 8 8/2/2010 Filled Positions Impacted • Senior Vehicle Body Technician-Currently there is one filled position remaining out of 3 5 positions previously in the Vehicle Body section The fleet study has determined that it is more cost effective to outsource vehicle body maintenance than perform that function internally due to costs associated with maintaining the paint booth and other required equipment • Neighborhood Preservation Manager- As part of the restructuring of the Planning and Building Dept ,and a 25%reduction of code enforcement officers,it has been determined the Neighborhood Preservation Program Manager position is no longer necessary All the elements of the Neighborhood Preservation Program have been absorbed into the Code Enforcement program Filled Positions Impacted • Project Manager Assistant—The City is approaching buildout which is the primary source of funding for park and beach projects Additionally,development has slowed significantly in the city, which further reduces project funding and need for staff in the development section Project assistance,if needed,will be provided by the Senior Analyst The Assistant Project Manager position is no longer necessary as the workload does not support it 9 8/2/2010 Operational Reductions ��i • Reduction in marine safety hours of operation o Reduction in overtime funding resulting in the reduction of non-peak season lifeguard service hours from 18 hours to io hours per day • Closure of the Oak View Police Substation o Closing the substation will have a minor impact on community,has been staffed by volunteers Substation is not being utilized to full potential currently • Reduce crossing guard program o Reduce coverage at approximately seven intersections citywide Operational Reductions 20 • Reduction of additional ambulance during peak summer days • Reduced staffing at all Central Library service desks Reductions expected in media,programming and story time services • Community Services Director will not be filled upon retirement, Deputy City Administrator will fill that position for the balance of the fiscal year • Miscellaneous reductions have been taken by all departments to achieve the necessary savings to balance the budget 10 8/2/2010 Bright Spots • Increases the investment in equipment from $1 million to $2 million • Establishes a litigation reserve totaling $15 million to support claims and liability expenses • Supports increased election costs related to the City Charter and Utility Users Tax ballot measures • Except for the two year repayment plan for the PARS payouts,we are not dipping into our financial reserves • Proposed budget maintains equipment and capital reserve balances Necessity is the Mother of all invention' (2 • Library pursuing new technologies to assist the public, including self-check out kiosks • Sharing of staff across departments • Continue to evaluate the cost effectiveness of outsourcing maintenance operations x 11 8/2/2010 III al"III � � �iNANCIAL "There s always an element of risk No one has a crystal ball OK I have one but no one knows how it works Key Assumptions 24 1 • CALPERS increases of$3 million in FY11/12, $2 5 million in FY12/13, and another $2 5 million in F'13/14 • Repay PARS leave payouts in 2 years • Fully fund PARS in 5 years • Sunset of labor concessions 12 8/2/2010 Key Assumptions � 25i • Step up infrastructure investment o Additional $15 million in FY 2013/14 o Additional $3 o million in FY 2014/15 o Additional $4 5 million in FY 2015/16 • Step up funds available for equipment purchases • Maintain workforce at proposed level o Proposed agency structure will reflect approximately 200 less positions than Adopted FY 20o8/og budget of 1,144 4 Five Year Financial Plan-Preliminary Projected Revenue vs Expenditures (in millions) o e a e "Revenue $18o $183 $187 $192 $197 Expenditures (182) (187) (193) (198) (201) Challenge ($2) ($4) ($6) ($6) ($4) 13 8/2/2010 27 $tocKS DROPPED ON NEWS T"T BERNANKE wM 6\JrW4 9D kNw5I-"wCr NEWS TH6TUNE OvEs�S�Wt 0® a� SckwAfl Po.-. �— General Fund Reserves �'�1 _ • Economic Uncertainties $18 o million • Equipment Replacement $ 6 9 million • Capital Projects $ 3 o million • Litigation $ 15 million 14 8/2/2010 29 7- There Will Be 'Things We Don't Know � 1 • State of California's budget o After four weeks of their fiscal year without a budget,there are no proposals close to adoption • Pace of economic recovery • Outcome of elections as they relate to the City Charter amendment and other ballot measures • Final structure of the organization after 9/30/2010 15 8/2/2010 City of Huntington Peach Proposed Budget 01� FISCAL YEAR 2010/11 QUESTIONS? 16