HomeMy WebLinkAboutCity Manager's Report - Presentation of New Long Range Finan p
p, 2000 Main Street,
Huntington Beach,CA
92648
City of Huntington Beach
r
File #: 25-053 MEETING DATE: 2/4/2025
Subject:
Presentation of New Long Range Financial Plan
amnp City of Huntington Beach Page 1 Printed on 1/29/2025
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Overview of Financial Forecast
Model and Fiscal Outlook
February 4, 2025
SUPPLEMENTAL
COMMUNICATION
Meeting Date: 2/4/2025
Agenda Item No. 8 (25-053)
Presentation — Table of Contents
Understanding the • Purpose of a Forecast Model
• Baseline Forecast & Model Assumptions
City's Forecast Model • Major Drivers & Indexes
• Revenue & Expense Trends
10-Year Baseline
• Annual Operating Surplus/Deficit
Forecast • Fund Balance
Scenario Forecast • Changed Assumptions
• Baseline vs. Scenario Comparison
• Strengths & Opportunities
Fiscal Outlo
• Challenges & Concerns
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UFI — Financial Advisors & Consultants
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Financial Forecast Modeling Financial Advisory Services
- Forecast modeling for California - UFI is a full-service financial advisory firm
municipalities since 2012. that has served California municipalities
since 1972.
- UFI currently provides active forecasting
services to fifteen municipalities in - The leading municipal advisor since 2011
California, including the following: based on number financings
- City of Alameda Top Municipal Advisors for CA Municipal Bonds
- City of Corona 2018 - 2022
No. of Par
- City of Culver City Rank Firm Issues ($MM)
- City of El Segundo 1 Urban Futures Inc 687 $15,632.3
2 Fieldman Rolapp &Associates 454 16,621.9
- City of Ontario 3 KNN Public Finance 348 37,123.4
- City of Pomona 4 PFM Financial Advisors LLC 309 31,395.9
5 Public Resources Advisory Group 208 64,907.3
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UNDERSTANDING CITY'S FORECAST MODEL
4
Developing a Forecast Model
✓ Standardized Revenue & Expense Categories.
Model uses standardized revenue and expense
categories that correlate with available Tailored Forecasting
economic data, projections, and variables Algorithms
appropriate for driving municipal forecasts.
UFI uses econometric data from
✓ Integration of City's Historical Financial Data. Moody's Analytics, U.S. Précis® Metro
Model integrates 10 years of annual financial forecast service, combined with a
data from the City's general ledger. variety of city, regional and state
financial projections and indicators to
✓ Baseline Forecast with Fund Balance Allocation. create forecasting algorithms that
Model produces a 10-year baseline forecast of drive each revenue and expense
revenues, expenses, cash flows and fund category in the City's baseline
balance for purposes of analysis and forecast.
comparison with "what-if" scenario forecasts The econometric data is statistically
correlated with outputs from the
✓ "What-if" Scenario Forecasts, Including Built-in City's historical financial data to
Modules. Model enables the City to create create four custom forecast trendlines
"what-if" scenario forecasts to compare against (aggressive, average, conservative and
the baseline, allowing the City to make more pessimistic).
informed and fiscally sustainable financial
decisions.
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Huntington Beach Forecast — General Assumptions
• City's baseline forecast built around FY 2025
General Fund budget adopted by the City
Council. What is a "Baseline" Forecast?
• Base Salaries. Includes current MOUs with Neutral, fiscal assessment and
long-term assumption that average annual decision-making tool that
growth aligns with CaIPERS growth establishes a common
understanding of the City's status
assumption (2.85% per annum).
quo fiscal outlook:
• CaIPERS UAL. Incorporates amortized loss "If the City makes no changes to its
basis from FY22 (-6.2% return) and gain basis organization, operations or service
levels, and there are no significant
from FY23 (+9.5%). external economic impacts to the
City (other than what's known
• Homeless Program. Assumes General Fund today), what is the predicted
will pickup program costs beginning FY26. condition of the City's finances over
• ROPS Waterfront Revenues. Treated as one- the next ten years?"
time revenues used for one-time expenses.
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Huntington Beach Forecast — Fiscal Issues Not In Model
• Underfunding of Equip. Replacement. What-If Forecasting Enhances
City's projected schedule for annual Prioritization & Accountability
equipment replacement is currently
underfunded. California cities operate within a
highly-constrained revenue
• Underfunding of Critical Infrastructure. environment. With no rate-making
City's recent Infrastructure Report Card authority and no taxing authority
identified critical infrastructure projects without voter approval, cities must
that are currently unfunded. largely operate within an existing
revenue structure. This makes revenue
• Restoration of Departmental Cuts. In forecasting essential for good fiscal
prior years, operating cuts have been management.
made to various departments affecting
service delivery and/or quality. However, revenue forecasting alone is
insufficient. Forecast modeling with
• EMS Revenue Risks. Revenues from the "what-if" scenario capacity enables
Voluntary Rate Range Intergovt. Transfer cities to evaluate and align competing
Program (VRRP IGT) that helps offset community priorities with constrained
EMS service costs to Medi-Cal patients revenue capacity, enhancing
is vulnerable to changes in federal accountability based on transparent
appropriations and addtl. participants. and deliverable outcomes.
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Huntington Beach Forecast - Major Drivers & Indexes
Key Categories & % of Total Historical Forecast Forecast
,_ . ,.. ,,._. . AAGR Trendline A/�► R
Revenues 4.18% 3.03%
Property Taxes (35%) 5.41% average 3.96%
Sales & Use Tax (17%) 3. 72% average 3.10%
Cost Recovery & Earnings (12%) 2. 74% average 2.62%
average/consv.
Utility User Tax (7%) 1. 76% average 1. 74%
Expenses 4.34% 2.70%
Salaries & Wages (40%) 2.83% MOU or 2.85% 2.95%
Transfers Out* (17%) 27. 77% -- 2.43%
Pension (Normal & UAL) (12%) 0.87% average 3.26%
Benefits (excl. pension) (11%) 4. 71% 2 x CPI 4.11%
Supplies & Equipment (8%) 2.00% average 2.61%
* Transfers Out include Equipment Fund, Infrastructure Fund, Self-Insurance Fund and Homeless Program
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10-YEAR BASELINE FORECAST
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Baseline Forecast — 10-Year Projections (2025-35)
CURRENT
BASELINE FORECAST FISCAL FORECAST FISCAL YEARS
-1 0 1 2 3 4 5 6 7 8 9 10
CategaY/TYpe ndlirre Forecast x FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 FY 2032 FY 2033 FY 2034 FY 2035
to I
(expand columns to include prior Road years) AAGR
REVENUES
1 Property Taxes(incl.VLF In-Lieu) 4.05% $ 105,665,647 $ 108,087,472 $ 112,722,110 $ 117,364,341 $ 121,975,344 $ 126,428,753 $ 131,721,180 $ 137,128,896 $ 142,826,281 $ 148,434,943 $ 154,411,518 $ 160,732,255
2 Sales&Use Taxes 3.10% 51,421,440 53,488,453 55,254,756 56,976,501 58,694,841 60,431,265 62,306,930 64,208,970 66,230,964 68,192,651 70,309,115 72,569,839
3 Utility User Tax(UUT) 174% 23,282,648 23,000,000 23,398,448 23,794,717 24,176,558 24,579,680 25,001,564 25,433,717 25,894,028 26,338,928 26,819,904 27,327,435
4 Transient Occupancy Tax(TOT) 3.26% 17,398,883 16,780,000 17,457,781 18,099,547 18,870,220 19,406,309 19,998,012 20,593,036 21,218,239 21,814,570 22,452,142 23,126,022
5 Business License/Operations Tax N, 0.19% 2,900,681 2,705,000 2,719,048 2,728,596 2,735,984 2,741,342 2,744,957 2,748,130 2,750,131 2,752,420 2,755,160 2,756,604
6 Other Taxes or Assessments 2.91% 1,654,805 1,565,000 1,649,427 1,739,911 1.792,289 1,845,765 1,889,400 1,930,259 1,968,109 2,005,663 2,043,432 2,082,250
7 Franchise Fees 3.02% 9,704,587 10,620,000 10,872,577 11,123,269 11,370,031 11,712,073 12,081,321 12,469,652 12,896,936 13,321,183 13,794,242 14,301,678
8 Permits,Fees&Gugs.for Service 1.26% 30,539,144 33,225,232 33,928,676 34,389,501 34,755,859 35,179,270 35,592,669 35,977,072 36,348,360 36,760,364 37,221,596 37,670,772
9 Cost Recovery,Earnings&Misc. 2.62% 39,667,092 37,936,706 39,055,162 40,205,118 41,233,217 42,289,827 43,375,279 4,1,473,319 45,605,566 46,737,922 47,912,222 49,124,852
10 Annual Transfers In&Variable Revenues / 0.31% 6,068,195 7,012,816 7,033,891 7,054,939 7,075,12_5 7,095,549 7,116,887 7,138,564 7,161,752 7,183,854 7,207,932 7,233,749
11 Dne-Time Revenues,Transfers&Adjustments 9,779,076 7,274,566 6,742,718 2,400,000 2,400,000 2,400,000 2,400,000 1,689,515 - - - -
(Less One-Time Revenues,Transfers&Adjustments) (9,779,076) (7,274,566) (6,742,718) (Z400000) (2,400,000) (2,400,000) (2,,400,00O) (1,689,515) - - - -
TOTAL BASELINE REVENUES 3.03% $ 288,303,122 $ 294,420,679 $ 334,091,877 $ 313,476,440 $ 322,679,467 $ 331,709,834 $ 341,828,260 $ 352,101,614 $ 362,900,365 $ 373,542,498 $ 384,927,266 $ 396,925,956
EXPENSES
20 Salaries&Wages 295% $ 115,193,719 $ 12,490,673 $ 125,241,976 $ 128,723,998 $ 132,392,632 $ 136,165,822 $ 140,046,548 $ 144,037,875 $ 148,142,954 $ 152,365,028 $ 156,707,432 $ 161,173,593
21 Benefits 4.11% 30,376,6,38 33,257,010 35,126,312 36,642,481 38,14,1,932 39,679,403 41,244,027 42,835,513 44,462,506 46,153,865 47,915,295 49,749,505
22 Pension&OPEB ,,.— 3.26% 36,741,128 36,043,034 41,913,930 44,812,873 47,753,102 50,685,006 50,117,471 49,398,883 49,285,604 49,206,695 49,115,200 49,008,392
23 Contractual Services(labor) 3.29% 20,875,786 22,834,822 23,589,990 24,418,848 25,214,529 26,010,106 26,874,847 27,756,162 28,676,597 29,587,428 30,547,368 31,553,061
24 Operating Supp.&Equip.(non-labor) 2.61% 23,142,438 23,504,181 24,160,509 24,869,936 25,560,955 26,232,960 26,888,754 27,555,869 28,247,910 28,935,424 29,653,717 30,400,501
25 Insurance&Liability 2.45% 75 500,000 513,070 526,123 538,642 551,309 564,542 577,985 592,366 606,073 621,005 637,016
26 Debt Service -13.44% 7,250,503 6,503,248 6,152,681 6,148,446 5,470,406 5,468,885 5,325,921 3,920,794 2,961,644 1,072,844 1,066,900 1,065,900
27 Capital Asset Investments(non-CIP) N., 118,466 - - - - - - - - - - -
28 General Adrnin,Overhead&Cost Allocation /' L55% 3,343,454 5,220,920 5,309,492 5,397,557 5,483,732 5,569,554 5,655,870 5,741,622 5,828,325 5,914,425 6,001,275 6,089,019
29 Annual Transfers Out&Variable Expenses 1.79% 47,629,102 51,416,393 49,367,371 50,602,165 51,796,400 52,990,857 54,272,449 55,574,094 56,957,103 58,292,539 59,737,092 61,275,680
30 One-Time Expenses,Transfers&Adjustment: �,,'"-- 7,597,695 225,000 6,742,718 2,400,000 2,400,000 2,400,000 2,407,000 1,689,515 - - - -
(Less One-limeExpenses&Adjustments) 7.\/ (7,601,245) (525,000) (6,74Z,718) (2,400000) (2,4C0,000) (2,40,000) (2,400,000) (1,689,515) - - - -
TOTAL BASEUNE EXPENSES 270% $ 284,667,818 $299,470,281 $ 311,435,332 $ 322,148,426 $ 332,355,330 $ 343,353,902 $ 350,990,429 $ 357,398,796 $365,155,008 $ 372,134,319 $ 381,366,284 $ 390,952,668
FUND(5)BAULNCE-END OF FY $ 132,319,000 $ 134,018,964 $ 126,675,509 $ 118,003,523 $ 108,327,659 $ 96,683,592 $ 87,521,423 $ 82,224,240 $ 79,969,597 $ 81,377..776 $ 84,939,757 $ 90,912,545
Non-spendable 148,000 148,000 148,000 148,000 148,000 148,000 148,000 148,000 148,000 148,000 148,000 148,000
Restricted 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000 21,670,000
Committed 52,023,000 52,844,714 54,838,889 56,624,404 58,325,555 60,158,650 61,431,405 60,406,240 58,151,597 59,559,776 63,121,757 68,091,778
Assigned 58,478,000 58,478,000 50,018,620 39,561,118 28,184,104 14,706,941 4,272,018 - - - - 1,002,767
Other Fiscal Policies(%of Total Expenses) - - - - - - - - - - -
[reserved](%of Total Expenses) - - . - - - - - - - - -
UNDESIGNATED FUND BALANCE 5 - $ 878,251 5 - $ - S - $ - $ - 5 - $ - $ - $ • $ -
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Baseline Forecast — Revenue & Expenses Trends
Total Revenues & Expenses
10-Year Prior and Baseline Forecast
$450,000,000
_ Annual Operating
ARPA Local Fiscal Deficits Until FY 2033
$400,000,000 Recovery Funds I ',_ ,`
$350,000,000 ,011,'
Covid-19
$300,000,000 Pandemic - / `s Debt Obligations
& Recovery ,' g
i I Expire ($4.5m/yr.)
$250,000,000
j s Growth in Transfers Out
$200,000,000 (infra., equip., liability)
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$150,000,000 . . . . . . . . . . . . .
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Surplus/Deficit --S Baseline Revenues - - -1-Time Revenues
--•Baseline Expenses - - -1-Time Expenses
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Baseline Forecast — Annual Surplus/( Deficit)
Annual Operating Surplus/(Deficit)
10-Year Prior and Baseline Forecast
$30,000,000 ARPA Local Fiscal
Recovery Funds
$25,000,000
Growth in Transfers Out 1�
$20,000,000
(infra., equip., liability)
$15,000,00o I Annual Operating
I Deficits Until FY 2033
$10,000,000 NA I
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$5,000.000 I II II
$(5,000,000) Covid-19
Pandemic
$(10,000,000) & Recovery Debt Obligations
Expire ($4.5m/yr.)
$(15,000,000)
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Baseline Forecast — Cumulative Surplus/( Deficit)
Cumulative Operating Surplus/(Deficit)
Baseline Forecast
Debt Obligations
lo,000,000 Expire ($4.5m/yr.)
(Zo,000,000) —"11.--.1—F' ,
(20,000,000)
(30,000,000)
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(40,000,000) I
1
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(50,000,000) I Annual Operating
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(60,000,000) i
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Baseline Forecast — Fund Balance Impact
Year End Fund Balance & Allocation
10-Year Prior and Baseline Forecast
$160,000,00o Annual Operating
ARPA Local Fiscal Deficits Until FY 2033
$140,000,00o Recovery Funds
$120,000,00o Debt Obligations
Covid-19
Expire ($4.5m/yr.)
S1oo,o00,00o Pandemic ►
& Recovery
$80,000,000
$60,000,000
$40,000,000
Growth in Transfers Out
$20,000,000 '° „E ., liabilit`
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SCENARIO FORECAST
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Scenario Forecast — Changed Assumptions
1. ROPS Waterfront Revenues. Assumes remaining one-time
ROPS Waterfront Revenues of $18 million are used to pay
ongoing General Fund operating expenses between FY 2026
and FY 2031 (instead of being used for one-time expenses).
2. Pension (UAL) Management. Assumes two additional
payments to CaIPERS to prepay/reduce City's increased UAL.
$5 million at end of FY 2025 and $5 million at end of FY
2026. Saves General Fund $15 million over the forecast
period.
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Baseline Forecast — Revenue & Expenses Trends
Total Revenues & Expenses
10-Year Prior and Baseline Forecast
$450,000,000
Annual Operating
ARPA Local Fiscal Deficits Until FY 2033
$400,000,00o Recovery Funds \
::::::::::
Covid-19 .. ,00.40.411 -______________JA Pandemic _ •_. _ / `s Debt Obligations
& Recovery , g
Expire ($4.5m/yr.)
$250,000,000
0. - s Growth in Transfers Out
$200,000,000 / \ i
' - (infra., equip., liability)
$150,000,000 . . . . . . . . . . . . . . . . . . .
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-♦-Baseline Expenses -1-Time Expenses _
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Scenario Forecast — Fund Balance Impact
Total Revenues & Expenses
10-Year Prior and Scenario Forecast
$450,000,000
Annual Operating
ARPA Local Fiscal Deficits Until FY 2033
$400,000,000 Recovery Funds I / --� /
::::::::::
Pandemic _ / .t Debt Obligations
& Recovery , _ g
Expire ($4.5m/yr.)
$250,000,000
.• . -' i
s \ Growth in Transfers Out
$200,000,000 .- " (infra., equip., liability)
I
$150,000,000
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—*—Baseline Expenses - - -1-Time Expenses
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Baseline Forecast — Annual Surplus/( Deficit)
Annual Operating Surplus/(Deficit)
10-Year Prior and Baseline Forecast
$30,000,000 ARPA Local Fiscal
Recovery Funds
$25,000,000
$20,000,000 Growth in Transfers Out I
(infra., equip., liability) I
$15,000,00o I Annual Operating
I Deficits Until FY 2033
$10,000,000 I
$5,000,000
$-
$(5,000,000) Covid-19
Pandemic
$(10,000,000) & Recovery 4) Debt Obligations
Expire ($4.5m/yr.)
$(15,000,000)
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Scenario Forecast — Annual Surplus/( Deficit)
Annual Operating Surplus/(Deficit)
10-Year Prior with Scenario vs. Baseline Forecast
$30,000,000 ARPA Local Fiscal
Recovery Funds
$2 5,000,000
Growth in Transfers Out 1$20,000,000 :
(infra., equip., liability) 1
$15,000,000 I Annual Operating
Deficits Until FY 2033
$10,000,000 - I
$5,000,000 II I
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$(5,000,000) Covid-19 :"4
: .
Pandemic �-
$(10,000,000) & Recovery ~" : ''" Debt Obligations
.'. Expire ($4.5m/yr.)
$(15,000,000)
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Cumulative Operating Surplus/(Deficit)
Baseline Forecast
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Cumulative Operating Surplus/(Deficit)
Scenario vs. Baseline Forecast
Debt Obligations
Zo,000,000 Expire ($4.5m/yr.)
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(20,000,000)
(30,000,000)
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Baseline Forecast — Fund Balance Impact
Year End Fund Balance & Allocation
10-Year Prior and Baseline Forecast
$160,000,000 Annual Operating
ARPA Local Fiscal Deficits Until FY 2033
$140,000,000 Recovery Funds i
$120,000,00o Debt Obligations
Covid-19
Expire ($4.Sm/yr.)
S1oo,o00,000
Pandemic
& Recovery
$so,000,000
$60,000,000
$40,000,000
Growth in Transfers Out
$20,000,000 '•° ` ,bi CI) liabilit '
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Scenario Forecast — Fund Balance Impact
Year End Fund Balance & Allocation
10-Year Prior with Scenario vs. Baseline Forecast
$160,000,000
ARPA Local Fiscal Debt Obligations
$140,000,00o Expire ($4.5m/yr.)
Recovery Funds Ni ............
$120,000,000
Covid-19 •
$100,000,000 Pandemic ► .••
& Recovery \ •• ....
$80,000,000 • �''•..............
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$60,000,000 '.� ""'
$40,000,000
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FISCAL OUTLOOK
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Fiscal Outlook — Strengths & Opportunities
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oouoo,
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Revenue Diversity Debt Service Reserves
• Good diversity of tax • Current debt service • Total General Fund
base and not overly primarily for reserves at 37% of
reliant on any single- equipment and baseline expenses.
source of revenue. facility related leases Contributed to "AAA"
(except for POB). financial resiliency
• Still unused local rating by Fitch.
sales tax capacity. • Expiring annual debt
service creates fiscal • Baseline forecast
• Baseline revenues capacity in later projects dip to 20%.
projected to grow years of forecast for
slightly faster than • Mitigation of annual
strategic investment.
baseline expenses. Fitch put City mid- deficits during first
Fitch rated City is range for long-term half of forecast is
72nd percentile for liability burden. important to reserve
economic metrics. maintenance.
UFI ri// q,
26
ifr
Fiscal Outlook — Challenges & Concerns
c,z, 0 0
,o,
0
Annual Operating Pension Labor Costs
Deficits/Fund 1
I Management ,
• City s historical labor
Balance • RisingUAL converted cost growth has
• Annual operating to level debt service been moderate.
deficits through FY33 with POB in FY21.
i • Salaries & Wages
caused by current • CaIPERS -6.2% FY22 2.83% prior and
gap between returns created forecasted at
revenues/expenses + ` significant new 2.95%.
new UAL. unfunded liability.
• Co►ncunueo goon
• opportunn.ies to • Use of City's pension management of
reduce annual reserves to labor/benefit costs
transfer for equip. & proactively manage critical to sustain
infra.; spread costs UAL is opportunity fiscal health (over
through financing. for solid savings. 50% of expenses).
r UFI � ,.7. 1
7 '9...: 7
QUESTIONS .
gUFI
28 ---
From: an Madnick
To: supolementalcomm0 surfcity-hb.orq
Subject: budget
Date: Monday,February 3,2025 10:54:37 AM
You don't often get email fromjanmadnick@gmail.com.I earn why this is important
It amazes me that the members of this City Council,who promised those who voted for them that they would
represent their vision for what Huntington Beach should represent,would continue to look for ways to"privatize"
the City and its resources.
When public outcry stopped the privatization of the library you demeaned and lied about the petitions which would
put it on the ballot. Just agree to it and save the City money!!!
Now you're considering another infringement of Central Park proper with the"light show". There was quite a
wonderful article about our park in the Register last week highlighting,among other things,the incredible variety of
birds that migrate into the park each year. It is clear that the proposed light show would damage that portion of the
park's environment. In addition,just like the Air Show agreement,you plan on using HB resources to support this
proposal. Do we get a say??
Lastly,your decision to overcharge/not renew the lease on Jack's Beach Concession,a landmark in this city for over
66 years, so that you can put in who?what? Again ignoring residents.
If you represent what HB residents see as the things that make HB stand out as a coastal community,then you need
to examine the actions you're taking. Certainly there are budget concerns,but,perhaps,fewer lawsuits would help
with that!!
Please represent all the citizens,
Jan and Leon Madnick
SUPPLEMENTAL
COMMUNICATION
Meeting Date: 2/4/2025
Agenda Item No. 8 (25-053)
From: Pat Goodman
To: CITY COUNCIL(INCL.CM0 STAFF1;5uoolementalcomm(o surfcity-hb.orq
Subject: Forecast Presentation February 4,2025 Agenda#8
Date: Monday,February 3,2025 10:58:30 PM
I'm looking forward to the financial forecast presentation tomorrow evening,
Agenda Item # 8. Here are a few questions I hope the consultants will
address during their presentation.
Slide 7 - Fiscal Issues Not Included in the Model.
Could you present a forecast that includes these issues?
Slide 8 - Major Drivers and Indexes
Property Taxes include tax for HB Pension Costs - is this applied to UAL or to
actual expenses for the year? Is this tax due to expire? Has the HP Pension
Cost tax been included in the forecast.
Transfers Out include Equipment Fund, Infrastructure, Self-Insurance,
Homeless Services. In Slide 7 some of these funding transfers are not
included in the forecast. Please explain.
Slide 10 - 10 Year Projections
Suggestion - show the Net Baseline Revenues and Expenses.
Slide 16 - Changed Assumptions
Does the ROP schedule include the 2022 and 2023 lawsuit award? 20% of
the payments are restricted for Community Development Affordable Housing
uses. How will these payments used (may be a budget question)?
How will this changed assumption effect the city's bond rating?
Other questions:
Is the Code 4/Pacific Airshow Settlement reflected in the forecast. If so
where and the cost per year.
Pensions:
It would be very helpful for the consultant to include a summary of pension
related issues including answers to the following questions:
Where are annual pension costs reflected in the financial statements?
What contributions do employees make to their pension? Are these
contributions reflected in the financial statements?
What is the definition of Unfunded Accrued Liabilities (UAL)?
How did this liability occur?
Where are the UAL's reflected in the financial Statements?
Is there an independent review of the UAL balance to determine its adequacy
to meet future obligations?
Thank you.
Pat Goodman
Huntington Beach, CA
Moore, Tania
From: Russell Neal <russneal@ieee.org>
Sent: Tuesday, February 4, 2025 12:27 PM
To: supplementalcomm@surfcity-hb.org
Subject: Agenda Item 8
Concerning our long range finances, I offer a few thoughts.
1. There is nothing more expensive than deferred maintenance. While deferring infrastructure.
maintenance is always a tempting way to balance budgets, it always costs more in the long run.
2. Above market compensation to government employee unions is the biggest issue for city
finances. A working group of union representatives and city officials should be formed to have
honest discussions about how to get this issue on a sustainable path without federal bankruptcy.
3. The shift from in store to at home retail purchasing is a major hit to city finances. Cities need to
have a sustained coordinated lobbying effort to get the state to share sales tax revenues from
online purchases. Additionally, the city should work with our retailers on things we could do to
enhance retail sales volume, including(a) parking improvements near stores, (b) a crackdown on
shoplifting and retail theft to make HB"off limits"to such thieves, (c) lighter city regulation on
retail stores, (d) "supply side" experiments in reducing taxes in such a way as to increase sales
volume and tax revenues. Consider a special"HB Shopper's Card"that will rebate shoppers for
shopping in HB.
4. Resist all pressure to raise sales tax rates. Keep HB a better place to shop than other cities.
Russ Neal
Huntington Beach
i