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Home My WebLink About06-10-2014 b3 rosalesKremke, Kate From: Mejia, Anthony Sent: Tuesday, June 10, 2014 12:58 PM To: Kremke, Kate Subject: FW: Agenda Correspondence Attachments: SLO Chamber of Commerce re. Fiscal Responsibility Phito- oup'401p;5 Agenda Correspondence for Item B3 on 06/10/14. JUN 10 2014 Anthony J. Mejia I City Clerk .e. c111A, ov sari 11115 omspo 99e Palm Street AGENDA Sari i uis Obispo, CA 93401 tel 1 805,781,7102 CQRR SPa1VDENCE Date's /' �� Item# From: Charlene Rosales ( mailto:charlene @slochamber.org] Sent: Tuesday, June 10, 2014 12:46 PM To: Marx, Jan; Christianson, Carlyn; Ashbaugh, John; Carpenter, Dan; Smith, Kathy Cc: Mejia, Anthony; Lichtig, Katie; Dietrick, Christine; Codron, Michael Subject: Agenda Correspondence Council Members, Please see the attached correspondence from the San Luis Obispo Chamber of Commerce regarding recommendations on a fiscal responsibility philosophy. Thank you, Charlene Rosales Director of Governmental Affairs San Luis Obispo Chamber of Commerce 895 Monterey St., San Luis Obispo, CA 93401 p (805) 786 -2770 f (805) 543 -1255 www.slochamber.or : www.visitslo.com : www.slo- business.com facebook.com/slochamber: @ slochamber E0I :BTSPO 11-1 June 10, 2014 895 Monterey Street San Luis Obispo, CA 93401 -3278 Ermina Karim, President/CEO City Council City of San Luis Obispo 990 Palm St. San Luis Obispo, CA 93401 Subject: Fiscal Responsibility Philosophy Dear Mayor Marx and City Council Members, The San Luis Obispo Chamber of Commerce supports the current efforts ofthe City Council to improve the accountability and transparency measures of the proposed extension ofthe Essential Services Measure (Measure 1). We are encouraged by the inclusion of a Citizens' Oversight Commission in the draft ballot language and the exploration being done on examples of municipal metrics dashboards as tools to provide greater citizen understanding, context and engagement in the City's financial health. The Chamber's support of the half - percent sales tax renewal includes the additional recommendation of a long -term public commitment by our City Council towards transparency and accountability through the adoption of a Fiscal Responsibility Philosophy. A comprehensive philosophy would provide a long -term, sustainable fiscal strategy that will guide the decisions of current and future City Councils by helping to maintain resident priorities and identify the long- term financial impacts of decisions. The philosophy is intended to create a framework to holistically address some of our most pressing challenges which include existing unfunded pension liabilities currently estimated to be $120 -130 million and a backlog of deferred maintenance of approximately $80 million. In our study of this issue, we have identified key components to include in a Fiscal Responsibility Philosophy and tactics to further these philosophical priorities. Wherever possible, we urge the incorporation of explicit numerical benchmarks derived from best practices in both the public and private sectors to support resident, emp loyee and City Council understanding. Key components include: • Enhance citizen understanding, transparency and engagement in the City's financial health and spending priorities o Create a user - friendly, online municipal metrics dashboard that provides visual reporting and context for understanding of the City's financial activity and fiscal health including but not limited to sales tax expenditures, total compensation costs including pay, benefit costs and pension obligations (consider cost projections provided by a third -party actuary), capital improvement spending and deferred maintenance expenditures ■ Give a high priority to capital improvements, including but not limited to land use and circulation elements such as overpass construction, road building, bike and pedestrian paths, park and open space acquisition, and other infrastructure improvements such as water and sewage treatment o Identify target levels of capital improvement spending expressed as a percentage of General Fund revenues i 805.781,2670 s'acPetzrni ercriA F 805.543.1255 ;i5ieslo.cair "! F. slochamber @slochamber.org ,,10 bu neS:i (,om SAN LUIS i I" P C' 895 Monterey Street San Luis Obispo, CA 93401 -3278 Ermina Karim, President/CEO ■ Give a high priority to deferred maintenance and repairs, including but not limited to system upgrades, replacement of structural components, street repairs and preventative maintenance. o Identify target levels of maintenance investment on existing City assets and infrastructure ■ Commit to addressing the unsustainable growth of total compensation costs including pension costs, liabilities and other employee benefits • Establish an acceptable range for total compensation, including pension and medical benefits, each expressed as a percentage of General Fund revenues, reflecting other comparable municipalities, local government employees and local private sector total compensation • Implement a long -term total compensation strategy based primarily on local labor market comparisons to include other local government employees (local cities, the county and local state employees) as well as the local private sector • Create a pension and benefit cost structure that is shared between the employer and employee; i.e., set an initial goal to achieve a 50150 normal cost split for existing employees • Establish a timeline and a comprehensive plan to pay down the City's unfunded pension liabilities • Provide each employee with an individual total compensation report that includes annual wages, vacation leave earned, sick leave earned, health insurance premiums and pension plan contributions and other elements that make up total annual compensation • Establish a more transparent labor objectives- setting process We believe these recommendations will improve the level of confidence that the residents of San Luis Obispo have in the City and the likelihood that they will vote in favor of renewing Measure Y. We also believe taking the steps outlined above will increase trust that the funds generated by the measure will be used as intended. More importantly, we believe that a commitment to the elements within the Fiscal Responsibility Philosophy will benefit the City's residents long into the future by providing overarching guidance for the complex challenge of operating in a way that is responsive to residents' needs, disciplined in good economic times and sustainable during volatile downturns. We look forward to remaining engaged as more ideas are brought forward and considered during this process. Thank you for considering our input. Sincerely, IM W iljlAmS �w��j4�.r Tim Williams { {B{fahrry VanderKelen Ermina Karim Chair of the Board Chair, Measure YTask Force President/ CEO `r 805.781.2670 sit oharrsi eroq F 805.543.1255 visitsla.coarr f slochamber0slochamber,org s10 twlnesb.com