HomeMy WebLinkAbout01/26/1993, 1-B - EIGHT POINT STRATEGY FOR DEALING WITH THE CITY'S REVENUE-EXPENDITURE GAPucvcauuca iv, i��r.
To: City Council, Management Team, Interested Others
From: John Dunn
oubject: Eight Point Strategy For Dealing With The City's Revenue -
Expenditure Gap
This outline was produced to assist me to discuss these matters with you. I
look forward to that.
* 1. Reduce services /reduce personnel
* 2. Reduce labor costs (Employee Working Group recommendations) such
as:
Salary decreases
Reduced work week
Unpaid time off
Early retirement incentives
Scheduled increase rollback
other
3. Implement other potential cost savings such as:
Reduce HRC -PCC grants
Review use of private sector contracts
Use citizen volunteers (to provide services)
Conduct expert study of Public Safety functions
* Reexamine need for current services
4. Increase revenues such as:
Departmental recommendations
* Revenue Task Force recommendations
Vertex cost of services study implementation
Assessment districts (street lighting, sweeping, and
landscaping)
* Increase Federal -State grants (staff committee)
* Property tax override for public safety, other
Economic development (long term)
Other revenue increase ideas
5. Use specified portion of reserve (fund balances)
6. Reduce capital improvement program (already assumed)
7. Reduce Equipment Replacement Fund contributions (already assumed)
8. Work with our State legislators (objective: eliminate further
State cuts in City revenue)
Discussion: To the degree that we successfully achieve points 2 through 8,
we reduce the pain in No. 1.
To better identify "what does the City do and why do we do it" the staff is
presently working on a Service Levels Analysis.
Special staff work is progressing in these areas.
h /strategy
1
COUNCIL MEETING DATES FOR 1993-95 BUDGET REVIEW
rOITMCTF- GOAL -qF.rVnNrr - qTRATFrvTC BUDGET DIRECTION
Tuesday, January 26
Worksbo N&.:1. r . r . t:-Inti-bductiog
7*00 to 10:00 pm
w Review proposed process
w. Review updated fiscal situation
m► Discuss eight point budget strategy and budget cutting assignment to dept
w► Review inventory of City services — what we do and why we do it
("Mission Driven Service Levels'
Saturday, February 6
. ..... . .. .... . ..... .....
..W. .. 6W �!:2. wShitt Sleeve' Goal = Baton'
9:00 am to 3-00 pm
Elo-Background
— Review status of existing goals
— Review advisory body suggestions
— Review staff "brainstormed" candidate goals
— Public input and comments
w Council Goal Setting
— Individual Council members present proposed goals
— Council initially prioritizes goals
Wednesday, March 10
. ..... .. . ......... .. .... ..... . ........ ......... . ...... ...
Workslio o:: .... . . ..... . .... ...... . .
W Review updated fiscal situation
9:00 am to 3:00 pm
FQ—R--j
Saturday, March 13
0- Review updated "mission driven service levels" and incorporate
9:00 am to 3:00 pm
draft Council goals into them
w Brief review of eight point budget strategy
— Review "Total Cut Solution" — closing the revenue/expenditure
gap solely through service/expenditure reductions
— Review revenue options & task force progress reports
W Further discuss draft goals and strategies
W outcomes
— Approve goals
— Direct staff on budget building strategies. For example, closing
the revenue expenditure gap through .....
* 40% service/expenditure cuts
* 30% new revenues
• 30% labor cost savings
Tuesday, June 8
7:00 to 10:00 pm
Tuesday, June')?
7-00 to 10-00 pm
Wednesday, June 30
7-00 to 10:00 pm
w Goal is to adopt budget by this date
►Held in reserve for budget adoption if necessary
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4
TASK ASSIGNMENTS
The CAO's eight point budget strategy identifies a number of tasks to be accomplished as
part of the 1993 -95 Financial Plan process. In addition to basic budget building tasks and
preparing the "total cut solution" which follows, the following is a summary of tasks already
completed or underway.
MISSION DRIVEN SERVICE LEVELS TASK FORCE
mo. What I Prepare comprehensive inventory of what we do and why
r Who Management Team
Mid— Management representatives from each department
EMPLOYEE WORKING GROUP
r What I Identify ways to mitigate employee layoffs through labor cost reductions
w Who I Association presidents and department fiscal officers
REVENUE TASK FORCE
wi� What I Identify and evaluate possible new revenue sources
w Who Bill Statler, Kathy Koop, Sue Baasch, Dave Elliot, Linda Asprion, and
Carolyn Dominguez
PREVAILING WAGE TASK FORCE
mo. What Determine if we can save money on construction projects if we adopt
our own prevailing rate standards and how we would do it
w Who Wayne Peterson, John Moss, Jeff Jorgensen, Ann Slate
TAX OVERRIDE FOR PUBLIC SAFETY TASK FORCE
o. What Determine what is necessary for a voter — approved tax override for public
safety (police and fire) purposes
0- Who Jim Gardiner, Erwin Willis, Wendy George, Cindy Clemens
FEDERAL — STATE GRANTS TASK FORCE
o. What Determine the opportunities for state and federal grants to improve our
fiscal condition
o. Who Deb Hossli, Terry Sanville, Linda Asprion, Jeff Zimmerman
5
Total Cut Solution
Goal
0- Identify service level/expenditure reductions that will close the projected gap between revenues and
expenditures without any new (or increased) revenues or labor cost savings
Guidelines
W No sacred cows - must be real
w No revenue offsets - must be expenditure reductions only, net of any reduced revenues
w No speculative reductions - must be a cost area over which management has control
(ie, no attrition nor personnel actions that are likely to get bogged down in meet - and - confer)
W No delays - must be able to immediately begin implementation upon adoption of the 1993 -94 Budget
is- No contract employee savings (unless their existing contract extends beyond 1992 -93) - we assume these!
w- No deferred savings - facilities, equipment & infrastructure must be maintained at levels that will
preclude the need for major rehabilitation in the future
1►ee6tr these: ` dedDes means thaCalmost all of ur t+edrictions wilt 7lave t6 come froai're War
Target
Reduce General Fund Expenditures By
r $25 million to address projected revenue /expenditure gap
r Additional $15 million to address potential state revenue cuts to cities as part of their budget process
Content
Same basic format used in preparing the S% and 1095' expenditure reductions.
a• Organized by $25 million and $15 million level, summarized by program
r Description of cut and its service impact
r Summary of regular positions affected and annual savings (including related operating savings)
Due Date
Submittals from the departments are due Wednesday, February 11.
Tarvets
Egivslent level of regular staffing cuts necessary to achieve the target
1992 -93
Revenue/Expend
Gap
State Take-Aways
Amount
Staffing*
Amount Staffing*
Budget
GENERAL FUND
City Council
140,900
16,200
0.0
9,700
0.0
Administration
CAO's Office
512,000
59,000
1.1
35,400
0.6
Cultural, Social & Economic
698,400
80,500
0.0
48,300
City Attorney
254 ,500
29,300
05
17,600
03
City Clerk
350,500
40,400
0.7
24 ,300
0.4
Personnel
516,500
59,600
1.1
35,700
0.6
Finance
1,029,500
118,700
22
71,200
13
Insurance & Non- depart'1
980,900
Community Development
1,584,700
182,700
33
109,600
2.0
Recreation
043,300
154,900
2.8
92,900
1.7
Public Works
5,185,700
598,000
10.9
358,900
65
Utilities
58,600
6,800
0.1
4,100
0.1
Police
5,844,800
674,000
123
404,400
7.4
Fire
4160 900
479,900
8.7
287,900
5.2
TOTAL. GENERAL. FUND :':.
': 661' 00
00000
43.7
:: ' :1 00'000 :?
262:
Water
3,970,000
436,700
7.9
Sewer
2,355,900
259,100
4.7
Enterprise funds are not
Parking
680,300
74,800
1.4
required to identify cuts
Transit
778,600
85,600
1.6
related to State revenue cuts
Golf
289,300
31,800
0.6
to cities
Whale Rock
615,600
67,700
12
TOTAL
:. 3:li350 900
.3 455 700
61.1.
1 00 000 -
>26 2'!
Egivslent level of regular staffing cuts necessary to achieve the target
Section B
FISCAL. SITUATION
T ds section provides an excerpt from the "Five Year Forecast for the General Fund"
presented to the Council on November 10, 1992, describing the scenario which we believe
provides the best basis for decision malting at this time (Scenario .2B). This forecast
scenario identifies ongoing deficits of $25 million annually, exclusive of any further State
revenue cuts to cities..
® Introduction to the Five Year Forecast:
M Description. of: Forecast Scenario .2B.
1
2
s Five Year .Forecast: Mid Range Assumptions (Scenario 2B). 3
It should. be noted that these projections are exclusive of any further. State revenue cuts- to
cities. - plans are currently being prepared for revenue cuts by the State of up
to $1. million in addition. to the $2S million revenue /expenditure gap identified in this
forecast scenario.
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