Resolution of the City Council of the City of Livingston Adopting the City of Livingston Budget for Fiscal Year 2013-2014.

Meeting Date: March 18, 2014

Agenda Item #13. Resolution of the City Council of the City of Livingston Adopting the City of Livingston Budget for Fiscal Year 2013-2014.

To see a complete copy of the 2013-2014 Budget CLICK HERE: 

STAFF REPORT

AGENDA ITEM: Resolution of the City Council of the City of Livingston Adopting the City of Livingston Budget for Fiscal Year 2013-2014.

MEETING DATE: March 18, 2014

PREPARED BY: Odi Ortiz, Assistant City Manager/Finance Director

REVIEWED BY: Jose Antonio Ramirez, City Manager

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RECOMMENDATION:

Adopt Resolution No. , adopting the City of Livingston Budget for Fiscal Year 2013-2014.

BACKGROUND:

The City’s financial records show that the City has depleted its General Fund balance (reserves) over the last 10 years. A decade of continuous operating deficits has resulted in significant impacts to City’s operations. The City had over 100% of fund balance in 2002 to cover its annual operating costs of over $3.5 million. This fund balance (reserves) was reduced to approximately 60% of annual operating expenditures by 2007 as expenditures materially increased to over $5.6 million. Five years later, the fund balance for fiscal year 2012-13 as of June 30, 2013, is $843,000 which is below 20% of the City’s projected annual expenditures. This figure reflects the

write-off of the Outstanding Notes Receivable (Loan) from the Former RDA in the amount of $511,000. The State Department of Finance declared this loan to be an un-enforceable obligation.

A similar scenario is reflected on the City’s cash balance in the General Fund. These are the results of the continuous economic challenges Livingston along with many other agencies continues to face.

Management conducted several budget workshops in mid 2013 in efforts to address the anticipated General Fund operating deficit of nearly $150,000 and to allow public/community input. This gap was then reduced to about $100,000 after management successfully negotiated a three year reimbursement agreement with Merced County in late September 2013. An analysis concluded that the County overcharged the City for Property Tax Administration between 2008 through fiscal year 2012. Per Statute of Limitations, the City could only recover three years of reimbursement plus accrued interest. County agreed to reimburse City in three fiscal year installments at just over $58,000 per year, FY2012-13, FY2013-14, and FY14-15.

This anticipated gap was further reduced by negotiating budget concessions with the bargaining groups. Agreements were reached with Management & Confidential employees and Public Works units in early November 2013. General Fund savings from these two units in the form of personnel cost is estimated at

$28,000 plus about $51,000 in other funds during fiscal year 2013-14. Late agreements were reached with our Police units after both units decided to exercise their right to Fact Finding procedures. On March 4, 2014, after a year of negotiations with these two units, an agreement was reached to honor the recommendations made by Mr. Burdick, mediator on Fact Finding process. Anticipated personnel savings to the General Fund from these two Police units during 2013-14 are estimated at $22,000 in the General Fund and about $5,200 in other funds.

A mid-year review was performed by finance in January-February and minor adjustments were made to revenue and General Fund expenditure projections, this included reallocation of funds within and between departments to balance the General Fund budget.

The City has posted a copy of the proposed budget on its website and will provide a free copy of the proposed budget on a CD to any citizen desiring to have one. Copies will also be available for public review at City Hall.

DISCUSSION:

Adopt the FY 13-14 proposed budget and/or provide direction to management.

FISCAL IMPACT:

The fiscal impact of the budget is contained in the budget document. See Budget Revenue & Expenditure Summary by Fund on pages 38-41.

ATTACHMENTS:

1. Resolution of the City Council of the City of Livingston Adopting the City of Livingston Budget for Fiscal Year 2013/2014.

2. Proposed Annual Budget for Fiscal Year 2013/2014 (copies previously provided to the City Council).

What follows below are the summary pages that I copy/pasted from the Budget Document I had to download from the City Website (Since it was not included in the Agenda Packet)

 

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