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Home My WebLink AboutStudy Session - Proposed FY 2024/25 Budget Review (2) ��NT NGTp 2000 Main Street, oF....�tas,.,•,?�< Huntington Beach, CA _ City of Huntington Beach 92648 \vUNTV ��' 7414,,kd4,0,0 File #: 24-349 MEE ING DATE: 5/21/2024 Subject: Proposed FY 2024/25 Budget Review City of Huntington Beach Page 1 of 1 Printed on 5/15/2024 powered tit LegistarTM _,,,,,w4...,..... i'' , ,\ T IN G rer:41b-,1,,. • c4. _ �pR PORgT;0..•• \ • -___ --_- - _ ••i < /;f", . City of Huntington Beach - - . ' 'f' '''''' i c' ' • Proposed FY 2024/25 Budget Review _ _-_,-, _ ___ - _ . _____ _ ___ _ _ _ _ /1 1 iiiillamileikibi '� 'I% Q: City Council Study Session '•. •= May21 , 2024 ••• Fe P° " -,•7 •, • 17, 1909 , •,• \\ I viwCt /## D P NTy rj�4/, SUPPLEMENTAL COMMUNICATION 1 Meeting Date: s/D2//a29 Agenda Item No.; / 621/-3 i') Presentation Overview • FY 2023/24 General Fund Budget Update • Proposed FY 2024/25 General Fund Budget Review • Proposed FY 2024/25 Capital Improvement Budget Review • Proposed FY 2024/25 Opioid Settlement Spending Plan • Key Budget Considerations for FY 2024/25 • Next Steps - FY 2024/25 Budget Approval �0i��NTINGT • izT ....::::::::�•'\� CC11NT`I �ii# il,,,........... Ail- ...... 1 TIN G in v .... c �..• 7toR P0RgTF • \ •. o •• �• \ r,i i ',it, .• ---- _ _ _ __ _ ___ O. S„,ip, ii4 �n�. • - — �_. - -= I FY 2024/25 General Fund ___,_ _ _ _� • -.„04.------ , , )). : Budget Udate , Alwoloa001 ,__4-, . _ • - ., . , _______ .,_ , ,sc. , ,_._._•••• , I. F •• 17, 1909 , •• •••••••••••• •:•r i?Ng. CtI#' 0 P ......... NTy _,,...........„, ,'' ..... \ WIING - IN. c �•.• � ,0RPORg7, •••see wele_ \ .1 \ co • et '' ' •• C' Proposed.- , ,,,, , , • FY 2024/25 „ , , /A, -, • ___________....__ __ . • __ _______ _ _ ��= == •- General Fund Budget Review _ ...._ _ • _ __• •• _ __„• ____ _ - -_,..„.:__ __._ -- sp .s- ;1.....abir,...-,:,_-- , w, , • , A _ . . . _,• _ ,r • AW -----7--- - ------- --- --- _ 4i...c.._i. ik*° 11V ••• FB PO ;. t a_ •• • 17, 190i •,• F ••........• L 0 C � 0 C P NTy ./ FY 2024/25 General Fund Proposed Budget Review • Proposed FY 2024/25 General Fund Budget is structurally balanced, with a projected $132K surplus General Fund (Fund 100) Proposed in thousands FY 24/25 Revenues (recurring) $292,888 * GF portion of Waterfront allocation, of which Revenues (one-time) * 6,877 25%is being transferred to the Section 115 Total Revenues 299,765 Trust, 23%is being transferred to the ' Equipment Replacement Fund, 15%is being Personnel Costs 190,858 transferred to the Workers' Compensation Fund Operating Costs 57,374 and 37%is being transferred to the General Liabilities Fund Non-Operating Costs ** 51,401 Total Expenditures 299,633 ** Includes Debt Service,Capital Expenditures, and Transfers Surplus/(Deficit) $132, • Continued Infrastructure Investments in FY 2024/25 ➢ General Fund transfer to the Infrastructure Fund totals $14.5M ➢ CIP budget totals $35.3M (decrease from prior year of $41 .2M due to $4.5M of AES projects in FY 2023/24) FY 2024/25 General Fund Proposed Revenues - $299.8M Other Revenue Charges for Current Services 0.6% Non-Operating Revenue 11.7% 2.5% Revenue from Other Agencies 2.7% Property Tax 36.1% Use of Money& Property 7.4% - Fines& Forfeitures 1.5% 14I License & Permits 2.9% Utility Users Tax 7.7% Sales Tax Transient Occupancy Franchises 17.8% Tax 3.5% 5.6% FY 2024/25 General Fund Proposed Revenues - $299.8M • Major revenue variances include: (update based on projected) ➢ Property Tax: $108.2 million (3.8% or $3.3 million increase) - Higher assessed valuations as of January 1 , 2024 versus prior fiscal year ➢ Revenue from other Agencies: $8.1 million (200.5% or $5.0 million increase) - Expected reimbursement of $5.5 million from participation in the Voluntary Rate Range Intergovernmental Transfer (VRRP IGT) Program. These revenues are partially offset by $2.3 million of expenditures related to program participation, for anticipated net revenues of approximately $3.3 million. ➢ Non-Operating Revenue: $7.5 million (173.8% or $4.7 million increase) - FY 24/25 includes one-time transfer of $6.9 million for first repayment related to the Waterfront Loan Superior Court Judgement - Partially offset by FY 23/24 one-time revenues of $2.3 million for Emerald Cove Superior Court Judgement FY 2024/25 General Fund Proposed Expenditures - $299.6M BY CATEGORY BY DEPARTMENT Finance Human Transfers * Other ** Information Services 1.9% Resources 15.0% 3.8% 2.8% 1.0% Debt Service Community 2.2% Police Development 3.4% _ it, 30.7% Community & Library Services Operating 5.4% _diddle 19.1% Public Works Personnel 8.2% 63.7% Fire Non- 20 9°/ 11111, Departmental 22.1% * Transfers include Infrastructure, Equipment, General Liability & ** Other includes City Council, City Manager, Section 115 Trust Transfers City Attorney, City Clerk, and City Treasurer FY 2024/25 General Fund Proposed Expenditures - $299.6M • Major expenditure variances include: ➢ Personnel: $90.9 million (4.7% or $8.6 million increase) - Increase to PERS Normal Cost and PERS UAL - Continuing impacts from FY 23/24 MOU updates - Addition of 4 FTEs (more details on following slide) ➢ Operating: $57.4 million (-2.6% or $1 .56 million decrease) - Citywide effort to realign costs and preserve funding for contractual increases and inflationary demands related to the provision of core services Recommended FY 2024/25 Authorized Positions • Staff is proposing 4 new positions in the FY 2024/25 Budget: Community Development Department • (1 ) Building Inspection Supervisor to provide staff supervision and oversight of complex residential and commercial projects (General Fund) Fire Department • (1 ) Limited-term Management Aide to serve as a community engagement coordinator (Opioid Funds) Police Department • (1 ) Real Time Crime Center Supervisor to oversee the proactive monitoring of available technology and information systems resources to aid in the prevention of crime (General Fund) Recommended FY 2024/25 Authorized Positions • Staff is proposing 4 new positions in the FY 2024/25 Budget: Public Works Department • (1 ) Fleet Maintenance Crew Leader to coordinate fuel sites and fuel system compliance (General Fund) • (1 ) Senior Mechanic to meet demand for heavy equipment and safety fleet vehicle maintenance and repairs (General Fund) • (-1 ) Non-General Fund position restructuring: — Upgrade of 1 vacant Capital Projects Administrator to Capital Projects Supervisor to oversee construction project management and contract administration — Upgrade of 1 vacant Deputy Director of Public Works to Deputy Public Works Director / City Engineer — Elimination of City Engineer position (-1 ) FY 2024/25 Full Time Equivalent - All Funds i,010.00 1,005.75 1,001.75 Proposed 1,000.00 - Budget Pre-COVID 991.75 990.00 983.75 986.25 986.25 986.25 987.25 978.25 980.75 980.00 Restructure 970.00 Plan 960.00 958.25 950.00 FY 14/15 FY 15/16 FY 16/17 FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 FY 23/24 FY 24/25 12 General Fund Long-Term Financial Plan 6. 1 % CaIPERS Return FY22/23 Actual Projected Proposed Projected Projected Projected (in thousands) FY22/23 FY23/24 FY24/25 FY25/26 FY26/27 FY27/28 Revenue (Recurring) 277,069 279,775 292,888 294,366 301,718 309,310 Revenue (One-Time)* 35,648 5,470 6,877 - - - Planned Use of Reserves - 8,804 - - - - Total Sources of Funds 312,717 294,049 299,765 294,366 301,718 309,310 Expenditures less UAL 254,720 264,960 274,435 281,813 290,201 297,443 CaIPERS UAL 4,891 5,000 5,215 8,981 12,727 16,458 POB Payment 13,663 13,276 13,106 12,750 12,537 12,537 One-Time Expenditures 18,721 8,804 6,877 - - - Total Expenditures 291,995 292,040 299,633 303,544 315,465 326,438 Restricted Reserves 16,978 - - - - - Surplus/(Deficit) $3,744 $2,009 $132 ($9,178) ($13,747) ($17,128) * FY 22/23 one-time revenue consists of $29.6M in American Rescue Plan Act funding and $1.8M in transfers from the Housing Agreement and Triple Flip fund. FY 23/24 one-time consists of General Fund portion of Emerald Cove settlement. • Current forecast requires use of Section 115 Trust reserves (per UAL Policy) starting in FY 25/26. FY 2024/25 Future General Fund Proposed Revenue Enhancements ➢ EMS Cost Recovery Fee Adjustment - The City's EMS fees were last updated in 2021 - Based on a third-party assessment coordinated by the Fire Department, staff will propose adjustments to the City's EMS fees ➢ Master Fee and Charges Schedule Adjustments - The City is in the process of completing a comprehensive fee study based on the FY 2023/24 Adopted Budget - Last fee study was completed in 2016 - Staff will propose adjustments to the City's Master Fee and Charges Schedule //�'..i�� TING .. .........\N ..- .. FY 2024/2025 c �..• ,coR P0RA7F s \ o • 63 \ Ca ital I m rovement Mil - •• \ Program (CIP) Nip' • C—_---- --- -__—=S._ -- • 1 F. N T yra. , !?p,4"`" '; ...,. ;..� aytZ�4 '10,0'a' • _� - ter' —.- ,.,.� ` '1 '�; o i, , .i "�. A '' .'' A`• �6 r xi ,,'erg ° , ,,A; , 5 s,11 i, ,. ,/ ice.° /,� /` �� ' - 174 t* ''o t a -t r ? .9 y wr l/ v � _ •• , _i I •p L i •tlf,, ,t• 1\IN.e. ••,,. 77, 190 i ••• ‘< 40 , see 0(INCTy , „. --y, iaw a ll � t FY 2024/25 CIP BUDGET ➢Budget ➢New Appropriations: $ 35.3 Million ➢Continuing Appropriations: $ 8. 1 Million Total $ 43.4 Million ➢Funding sources proposed: ➢General/Infrastructure Fund ($30M requested - $8M recommended) ➢ Enterprise Funds (Water and Sewer) ➢Special Revenue Funds (Measure M, Gas Tax, Prop 42, RMRA, PEG, Park DIF, Quimby, TIF) ➢Grants/Other (CDBG, OCTA) DRAINAGE $ 300K • Tide Check Valves $300k (INFR FUND) , • . 4 ' . . 1. 1 % 1 - .... , ,t,,, A r . . \ / . - . . , •It * . ,. 1 ; * .. 17 FACILITIES $4 . 9M • PD South Substation Move $109k (INFR FUND) • Newland House Museum Rehabilitation $100k (INFR FUND) • Park Bench Café Roof & Siding Repair $110K (INFR FUND) • Main Street HVAC Installation $650k (INFR FUND) • Library Master Plan $400k (CLS FUND) • Upgrade Central Plant Cooling Tower at Civic Center $768k (INFR FUND) • Civic Center Leak Assessment $100k (INFR FUND) • Facilities Master Plan $600k (INFR FUND) • Fueling Station Canopies (Phase 2 $410k (INFR FUND) `` ' • Replace R22 Air Conditioning Equipment $150k (INFR FUND) =_r r • Downtown Parking Structure $923k (INFR FUND) s , *`. a • Gothard and Murdy Fire Butler Bldgs $600K (INFR FUND) �' = ' 18 NEIGHBORHOOD $7 . 1 M • Residential Curb Ramps $700k (Measure M, CDBG FUND) • Residential Concrete/Tree/Overlay/Slurry $6.35M (GAS TAX, INFR FUND, Sewer and Water, Measure M) ll "'gust' - imirst°! ! e 7` . ^ r, J -t4 ,i . - ,:-+: /;,./111 .-1--,,, , A „ w...L ,a ;.— A , ti ,. i _ --t.4 d .t.., �k. — - ' .r. ", r1 ` PARKS AND BEACHES $4 . 6M • Edison Park Reconfiguration $2M (Park) • 9th Street Playground $120k (INFR FUND) • Softball Field Improvements $565k (Park) • Huntington Central Park Master Plan Update $181k (Park) • Langenbeck Park Playground Improvements $300k (Park) • Pleasant View Park Playground Improvements $600k (Park) • Discovery Well Park Pump Replacement $90k (INFR FUND) • Beach Restroom Analysis $200k (INFR FUND) • PCH & 6th Street Pedestrian Ramp $65k (INFR FUND) Rif • Huntington Harbour Bulkhead $400k (INFR FUND) ilkf r • Bluff Top Pathway Area Lighting $64k (INFR FUND) *r : SEWER IMPROVEMENTS • McFadden Sewer Lift Station Improvements (Continuing) $2M (Sewer Fund) ,,, F. , i - , , ) , 7,.. . . f '_: - - - :-; 1 t iit fm VV ?" :" I CI L ;..41V ter • `/I . f ii:-1'' STREETS & TRANSPORTATION $8 . 2M • ADA Improvement Program $250k (INFR FUND) • Fiber Optic Master Plan $100k (INFR FUND) • Citywide Mobility and Corridor Improvements $155k (TRAFFIC) • Downtown Street Lighting $400k (INFR FUND) • Arterial Rehabilitation $6M (RMRA, MEAS M) • BPMP (Gilbert Bridge Design Only) $424k (GRANT) • Bridge Preventative Maintenance (Bolsa) $655k (MEAS M) • Main Street Specific Plan Improvements $250k (INFR FUND) ,�y► a ,, ,e , t 1. WATER IMPROVEMENTS $9 .4M • Annual Water Main Replacement (Design) $150k (WATER) ' 7,- -, • Peck Reservoir Roof Replacement (Design) $500k (WATER) �'' • Water Treatment for Well 3A $2.2M (WATER) j L',i ' ,, • Well 4 Rehabilitation $1 .5M (WATER) i\' ' h • Well 14 Drilling and Casing Project (Design) $250k (WATER) �, )), s7. • Well 14 Storm Drain (Design) $50k (WATER) , • Well 14 Well House (Design) $500k(WATER) . , ^>\ \� �,`. , ..., • WOCWB 0C9 Cathodic Protection $3.7M (WOCWB) /1; . • 0C35 Seal Beach Vault Relocation $50k (WOCWB) • Water Production Building Rehabilitation $479k (WATER) .[,w ,= .`_- <-. 11 IOU , NM F - �' � 0.::447.4 1 ' 11'6 . t It • (lit 1 raw - ---- , " # 0 r ,. 1 f „,r.P....,, TIN N G in'-m- \\ v ""4.„ ..-- .. c �••• 1 041PORATF •• o . 6, \ • - _ _ •. _- - - -- '"”" ' 07FY 2024125 Opioid ,,,„,,,,,,,, . ,,, F "it II • e • = Settlement Spending =.--__ _,--:___ _---,--. • - i - __ •• ---- - _ _ • Planwowi , )). : th _ ......_:___ -ilP 411, t •�'•'; 7, 19 0��0•••' F C t ,1## / 0 0 ti NT�1 IOW ,.*4.��/'/ 24 Janssen & Distributors Settlement and NOAT II CA Bankruptcy Funds • The Fire Department proposes year 1 spending plan of $893,400 from the Janssen and Distributors (J&D) Opioid Settlement Funds and the NOAT II (Local Government Share) California Bankruptcy Funds to be expended in accordance with Exhibit E of the J&D settlement agreements and the California Mallinckrodt Statewide Abatement Agreement. • Expenditure of settlement and bankruptcy funds in future fiscal years will be programmed into future year budgets to ensure timely use of the funds. • These funds will be used for high-impact abatement activities and other approved uses. Fire will track expenditures to maintain compliance with the settlement agreements with the assistance of the Finance Department. Allowable Expenditures Table 1: High Impact Abatement Activities (HIAA) No. Activity • 50% or more of the funds from the CA Abatement 1 Provision of matching funds or operating costs for substance use disorder (SUD) facilities within the Behavioral Health Continuum Infrastructure Program (BHCIP) Accounts Fund will be �- used for high-impact 2 Creating new or expanded SUD treatment infrastructure' abatement activities Addressing the needs of communities of color and vulnerable populations 3 (including sheltered and unsheltered homeless populations)that are • Other funds will be disproportionately impacted by SUD applied to approved Diversion of people with SUD from the justice system into treatment, including opioid remediation uses 4 by providing training and resources to first and early responders (sworn and non-sworn) and implementing best practices for outreach, diversion and deflection, employability, restorative justice, and harm reduction 5 Interventions to prevent drug addiction in vulnerable youth The purchase of naloxone for local entities including for distribution and efforts 6 to expand access to naloxone for opioid overdose reversals. Key Positions for Success • Proposal to cover 100% of the costs for a part-time chief medical officer (contractor) with opioid settlement funds in year one to build up the program ➢ The chief medical officer will create programs to provide substance use disorder (SUD) healthcare and community engagement services ➢ The goal is for the groundwork laid in year one to support ongoing efforts and generate additional revenue streams for subsequent years • Proposal to cover 100% of the cost of a full-time Community Engagement Coordinator (Management Aide) ➢ Limited-term role dependent upon continued opioid settlement funding Detailed Expenditure Plan — Year 1 Opioid City Strategic Existing Description Total Costs Settlement Plan Priority 1 Notes Funding Portion Deliverable 1 FTE Community Engagement $120,000 $120,000 $0 8.A.7 This is a limited-term grant-funded position that depends upon Coordinator (Management continued settlement funds.The proposal is for 100%of the costs for a Aide) new position to be funded by opioid settlement funds. 0.50 Contracted Nurse $86,400 $43,200 $43,200 8.A.1 Existing funding is from the current agreement for 10 hours per week. Educator (UCLA) The proposal is to add 10 hours per week, with the added costs to be covered by opioid settlement funds. 1 FTE Community Engagement $157,000 $78,500 $78,500 8.A.9 Existing funding is from an FTE Management Analyst position. The Analyst (Management proposal is for 20 hours per week (50%) of costs to be covered by opioid Analyst- Not a new position) settlement funds. Savings to be returned to the general fund. 0.50 Contracted Medical $167,500 $167,500 $0 8.A.1 The proposal is for 20 hours per week(100%) of costs to be covered by Director/Chief Medical Officer opioid settlement funds. Equipment &Supplies $384,200 $384,200 $0 8.A.1 The proposal is to fully fund with opioid settlement funds for a year-one (operational and educational), purchase and not a recurring amount. Unused funds will roll over into to deliver SUD prevention and subsequent years. response services Training, public education, and $100,000 $100,000 $0 8.A.1, 8.A.7 The proposal is to fully fund needed equipment and supplies through outreach multimedia the public affairs office. development Year One Total $1,015,100 $893,400 $121,700 28 ,,....'. ... 1IN .. T ,4/ 1., �.• ..- ... ��csP ORA TE ..� `� ► .. \ o . � \ - _ .�,. . • • Key Budget Considerations ___ _ _ _ _ _ _ _ ___ - __ • _ ________ _ __;10,..ashi.F,,,.01, __ ,,,r ...... 0 , ,,, Q for FY 2024/25 _.._, . .:- . t„, - _ - — ,=--:_-____ . ily 0 _ ______ . .• •• 17, 19091 s'.**k- ‘\sc) Ar ... ,,,,,. . . .,..-. ..- • . • - ----N.es) ..••.1 -8 O F ••........- 0 C P 0 � U NTy - # 4wiI►//- City Council Direction and Feedback Requested • City Council feedback of the proposed FY 2024/25 Budget is requested, especially as it relates to: 1 ) Addition of 4 FTEs across various departments 2) General Fund portion of Waterfront Loan Settlement totals $6.9 million, transferred as follows: - 25% or $1 .7 million to the Section 115 Trust - 23% or $1 .6 million to the Equipment Replacement Fund - 15% or $1 million to the Workers' Compensation Fund �0(,',\ \A...NGTOy - 37% or $2.6 million to the General Liabilities Fund 4'it- -- 3) Fire Department Year 1 spending plan for Opioid Settlement Funds o . =A = FF C°iNTY 0;,i# ,,,............. i'\c "1" IN G T\1/40\ 0 — c ••.••_,c RP0RATF ••• '4i, 1 . 0 •• • _ _ - - ••, __ - - - ,.(/ -,,,,, ��"''''"'`' FY 2024/25 Budget - -, -____ _ _ , _ _ __-=___,,.- - —_A • - • • Next Steps zr. _ _ • • - • 4. W •••,•s� 7, 19 0��,•••- F C � 0 C P _ v NTy �i..�// FY 2024/25 Budget Next Steps • Based on City Council feedback tonight, staff will make requisite adjustments to the proposed FY 2024/25 Budget • Revised budget will be brought back for formal City Council consideration / adoption on June 4th ,/# NTING O�••.•\N .. . T- E-0 N <,\\ .• o .- I 1 l' '1 i, : c f p1C` n �`va r Questions ? .. _ � t. µk .- t,:;,, .. , i''' ,;'- , - Mr.Amory Hanson 8102 Ellis Avenue Apartment 121 Huntington Beach CA 92646 May 21, 2024 The Mayoress of Huntington Beach 2000 Main Street Huntington Beach CA 92648 My Dear Madam Mayoress, I would like to express my support for Item X { Sincerely Yours, Mr.Amory Hanson CC:The Honorable Patrick Burns CC:The Honorable Rhonda Bolton CC:The Honorable Daniel Kalmick CC:The Honorable Casey McKeon CC:The Honorable Natalie Moser CC:The Honorable Anthony Strickland SUPPLEMENTAL COMMUNICATION Mew Dale: 2. I2 Agenda kern No.. • D t-4'"3 � j 8102 Ellis Avenue Apartment 121 Huntington Beach CA 92646 May 21, 2024 The Mayoress of Huntington Beach 2000 Main Street Huntington Beach CA 92648 My Dear Madam Mayoress, I would like to express my support for Item XVII. Sincerely Yours, Mr.Amory Hanson CC:The Honorable Patrick Burns CC:The Honorable Rhonda Bolton CC:The Honorable Daniel Kalmick CC:The Honorable Casey McKeon CC: The Honorable Natalie Moser CC:The Honorable Anthony Strickland SUPPLEMENTAL COMMUNICATION! Meeting Date: s/-21/02 y Agenda Item No.; 1�- (.71-1-3 I/) Switzer, Donna From: Fikes, Cathy Sent: Tuesday, May 21, 2024 8:45 AM To: Agenda Alerts Subject: FW: 5/21/2024 Study Session Agenda Item 24-349 From: Paula Schaefer<pas92649@gmail.com> Sent: Monday, May 20,2024 4:05 PM To:CITY COUNCIL(INCL. CMO STAFF)<city.council@surfcity-hb.org> Subject:5/21/2024 Study Session Agenda Item 24-349 Mayor and City Council Members: More detail on the proposed budget is requested. For example,while the HR department 1% of the overall budget is shown, the "Other Services" is lumped together,yet comprises 3.8% of the budget. It is important that budget information related to the 5 departments included in "Other Services" be provided. When will more detailed information be available to the City's residents?Such as: unfilled positions, comparison of 23/24 actual expenditures to allow comparisons of projected budget for each department? Paula A. Schaefer SUPPLEMENTAL COM,"UN CATION Meeting 1(.2.3 ;Venda Item No.. 1