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Home My WebLink About04/17/1990, C-10 - 1990-91 BUDGET PROCESS �WII�IIIIII�I�I�III MEETING DATE. Intl city of san Luis osi spo -4-»-9 HNOZe COUNCIL AGENDA REPORT ITEM NU FROM William C. Statler, Director of Finance SUBJECT: 1990-91 BUDGET PROCESS CAO RECOMMENDATION By motion, approve the budget review process and calendar for Fiscal Year 1990-91. DISCUSSION Budget Review Process Under the City's two-year financial plan process, the 1989-91 Financial Plan document establishes the primary policy, program and financial guidelines to be used in preparing the 1990-91 Budget. Although budgets are adopted annually under the two-year plan, it is intended that appropriations in the second year of the plan will be based upon the framework and foundation developed during the two-year planning and budgetary process. Accordingly, no major policy or program changes are anticipated for 1990-91 above those already planned in the 1989-91 Financial Plan. This approach is recommended for three reasons: ■ Consistency with the Financial Plan policies regarding the two-year budgetary and planning process. ■ Significant workscope of current Council Work Program,Management Team,and Program Objectives, which are anticipated to carry-over into 1990-91. ■ Pending completion of the long-term financial health project and adoption of appropriate revenue strategies,uncertainty regarding the City's financial ability to fund significant.new programs or projects. For reference purposes, the Preface to the 1989-91 Financial Plan which outlines its purpose, format, and contents is provided in Attachment 1. Budget Calendar In considering the 1990-91 Budget,the following calendar and review schedule is recommended at this time: ■ Review and consideration of water and wastewater operating and capital programs April 24, 1990 ■ Review and consideration of any significant requests for operating program changes or capital improvement plan projects; review of revenue and fund balance projections May 15, 1990 ■ Adoption of the 1990-91 Budget June 5, 1990 With the exception of the water and wastewater operating and capital program review scheduled for April 24, the budget review dates have been scheduled for regular Council meetings; based on the extensive Council and community review experienced during the 1989-91 Financial Plan process,no special study sessions or public hearings are-anticipated,foL. 1990-91. �.oS •�• '" �►��IIIfl�1i��ldlll city of San luta OBispo COUNCIL AGENDA REPORT Financial Highlights for 1990-91 The following is a summary of the major operating program changes scheduled for 1990-91 in the 1989-91 Financial Plan: Fire and Environmental Safety (Hazard Prevention, page D-13) In conjunction with the review of the Fire Master Plan, the addition of one Fire Inspector position is recommended at a cost of$30,600. This new full-time, non-sworn Fire Inspector position will conduct work assignments currently performed by three shift Fire Engineers who work part-time as Fire Inspectors. These three Fire Engineer/Inspectors will be reassigned to fire suppression and training functions resulting in an outside training cost savings of $5,400 per year. The reassigned Fire Engineer/Inspectors will also eliminate the 15 - 20 minute aerial truck delay and will provide personnel to respond the City's wildland fire vehicle currently staffed by off- duty personnel. Parking (Operations, Maintenance, & Enforcement, page D-45) Operating and maintaining the new Marsh/Chorro Parking Garage is projected to cost $100,000 in 1990-91. This cost includes salaries for parking attendants ($44,000), electricity($18,000),contract maintenance($18,000),materials($5,000)and furnishings ($15,000). General Administration (City Administrative Officer, page D-80) Contingent upon an evaluation of the City's environmental review and coordination functions, $50,000 is provided for additional staffing if required. Organizational Support Services (Information Systems Management, page D-92) Conversion of contract staffing to a regular position of Information Systems Coordinator is recommended contingent upon the adoption of a comprehensive policy regarding the City's use, administration, and future information management needs. As reflected above,each of these operating program changes is contingent upon the completion of facilities or long-term planning documents. At this time, it is anticipated that sufficient progress will be made on these facilities or plans by July 1, 1990 to support the 1989-91 Financial Plan recommendations with the exception of the Information Systems Coordinator position. The completion of a comprehensive evaluation of the City's management information systems needs is not anticipated until fall of 1990, and accordingly, recommendations regarding the City's regular staffing needs for this function will be made at that time. Other Financial Pian Changes During 1989-90,the following changes were approved by the Council to the 1989-91 Financial Plan which affect the proposed 1990-91 Budget: Operating Programs ■ $30,000 for clerical staffing in support of the Council, CAO, and City Clerk. ■ $186,400 for negotiated MOA changes in the Fire Department. ■ $68,500 for an overfill lieutenant position in the Police Department. ■ $55,900 for the conversion of a contract long range planner to a regular position. ■ $71,000 for augmented regular and contract staffing in the Community Development Department to meet workload needs. ■ $736,700 for operation and maintenance of groundwater wells. a4o-d2 ��►�illlllll!►i°; city or san tuts OBISPO COUNCIL AGENDA REPORT Capital Improvement Plan Projects ■ $50,000 for Mission Plaza Projects ■ $143,000 for City Hall Asbestos Removal ■ $95,000 for City Hall Office Systems Furniture SUMMARY Under the City's two-year approach to financial planning and budgeting, the primary policy, program, and financial guidelines for preparing the 1990-91 Budget were established in the 1989-91 Financial Plan. Accordingly, it is anticipated that the 1990-91 Budget will be based on the 1989-91 Financial Plan,and that limited policy and program changes will be considered for 1990-91 beyond these already planned or approved by the Council. The budget calendar and review process for 1990-91 submitted for Council approval at this time reflects this approach. 90-91BUDGET/AMCMD.WPF PREFACE Att8ChmenL z.� HOW TO USE THE FINANCIAL PLAN DOCUMENT This document reflects the City's continued use of a two-year financial plan which emphasizes long-range planning and effective program management. The benefits identified when the City's first two-year plan was prepared for 1983-85 continue to be realized: • Reinforcement of long-range planning. • Concentration on developing and budgeting for significant objectives. • Establishment of realistic schedules for completing program objectives. • A pro-active budget providing for orderly and structured operations. • Promotion of more orderly spending patterns. s Savings in time and resources allocated to preparing annual budgets. Appropriations continue to be made annually; however, the Financial Plan is the foundation for preparing the budget for the second year. Additionally, unexpended operating appropriations from the first year may be carricd over for specific purposes into the second year with the approval of the City Administrativc Officcr. The City's Financial Plan serves four primary roles: • Policy Document i • Financial Plan • Operations Guide • Communication Tool To meet these roles, the Financial Plan is organized into the following nine sections: A. Introduction - The primary item included in this section is the Budget Message from the City Administrative Officer which outlines the format, principles, and key issues of the City's two-year financial plan. The introduction also includes the City's Award for Distinguished Budget. Presentation, a directory of officials, an organization chart, and the City's Mission Statement. B. Policies and Obiectives - This section summarizes the general budget policies that guide the preparation and management of the Financial Plan and Budget. New or significant changes in program policies are also included in this section along with the Council Work Program and Management Team Objectives. C. Bud¢et Granhics.and Summaries - Simple graphs and tables are provided in this section Which highlight key financial relationships and summarize the overall budget document. C PREFACE HOW TO USE THE FINANCIAL PLAN DOCUMENT (continued) D. Operating Programs - The operating programs described in this section form the City's basic organizational units, allow for the provision of essential services to citizens, and enable the City to accomplish the following tasks: • Establish policies and goals which define the nature and level of services required. • List suitable activities for delivering services. • Propose objectives for improving the delivery of services. • Identify and appropriate the resources needed to conduct activities and accomplish objectives. The City's operating programs are organized into six major functional areas: • Public Safety • Leisure, Cultural, and Social Services • Public Utilities • Community Development • Transportation • General Government E. Capital Imorovement Plan - All of the City's construction projects and capital purchases (other than vehicles or equipment acquired through the Equipment ' Replacement Fund) which cost more than $10,000 are included in the Capital Improvement Plan (CIP). Through the CIP, the City systematically plans, schedules, and finances capital projects to ensure cost-effectiveness and conformance with established policies. The CIP is a four year plan organized into the same functional groupings used for the operating programs. F. Debt Service Requirements - This section summarizes the City's debt service obligations at the beginning of the two-year Financial Plan period. G. Changes in Fund Balance - An individual summary of revenues, expenditures, and changes in fund balance is provided for each of the City's 15 operating funds. H. Budget Supplements - This section provides summaries which integrate financial plan sections as well as provide supplemental statistical and financial planning information. I. Budget Reference Materials - This section includes a budget glossary, an organization summary of the City's funds, and major preparation guidelines and policy docuiiients used in the development and administration of the Financial Plan. Each section is introduced by an overview which describes its purpose, format, and content. J