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CC 05-13-19 #4 Study Session Proposed FY 2019-2020 Budget Revised PresentationMay 13, 2019 FY 2019-20 Proposed Budget Study Session Today’s Presentation Major Accomplishments FY18/19 Changes to the Budget Document General Fund Revenue General Fund Expenditures Fund Balance and Forecast All other Funds –Subsidy/New Revenue Sources Today’s Presentation Recommended Expenditures by Dept. Staffing Issues and Challenges Next Steps Major Accomplishments Recruitment Software Implementation Tree City USA Growth Award Designation McClellan Road Class IV (separated) Bike Lanes Phase 1 Recognition of the Safe Routes 2 School Program Major Accomplishments Investment Management Services Budget Community Workshop New Recreation Software Neighborhood Events Volunteers, Wellness, and Collaboration Changes to the Budget Document Base Budget Community Funding Policy Department Workload Indicators Appendix A FY20 Recommended Proposed Budget by Fund Fund Type FY19 Adopted Budget Proposed Budget Change in $ Change in % Revenues General 76,888,476$ 87,100,152$ 10,211,676$ 12% Special Revenue 12,565,191$ 9,906,203$ (2,658,988)$ -27% Debt Service Fund 3,169,438$ 3,172,838$ 3,400$ 0% Capital Projects Fund 9,051,500$ -$ (9,051,500)$ Enterprise Funds 7,344,400$ 8,091,827$ 747,427$ 9% Internal Service Funds 7,024,288$ 8,129,553$ 1,105,265$ 14% Total Revenues 116,043,293$ 100,179,193$ (15,864,100)$ -16% Appropriations General 77,639,720$ 77,691,521$ 51,801$ 0% Special Revenue 13,689,297$ 7,802,377$ (5,886,920)$ -43% Debt Service Fund 3,169,438$ 3,172,838$ 3,400$ 0% Capital Projects Fund 17,868,000$ 177,500$ (17,690,500)$ -99% Enterprise Funds 10,854,026$ 9,843,236$ (1,010,790)$ -9% Internal Service Funds 8,498,378$ 7,104,589$ (1,393,789)$ -16% Total Appropriations 131,718,859$ 105,792,061$ (25,926,798)$ -20% Recommended General Fund Revenue -$87,100,152 Sales tax $25,637,093 Property tax $24,703,218 Transient occupancy $9,666,056 Utility tax $3,198,644 Franchise fees $3,162,457 Other taxes $1,181,050 Licenses and permits $2,524,000 Use of money and property $1,330,579 Intergovernmental revenue $354,547 Charges for services $13,233,225 Fines and forfeitures $615,000 Miscellaneous $882,283 Transfers in $12,000 Other financing sources $600,000 General Fund Revenue $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year General Fund Revenue 05 - Sales tax 10 - Property tax 15 - Transient occupancy 50 - Charges for services All Other Categories Total Revenue 2.83%2.75%2.66%2.58%2.52%2.38%2.36% $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Sales Tax Revenue 05 - Sales tax Total Revenue General Fund -Sales Tax $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Property Tax Revenue 05 - Sales tax 10 - Property tax Total Revenue General Fund -Property Tax $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Transient Occupancy Tax Revenue 05 - Sales tax 10 - Property tax General Fund -TOT $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Charges for Services Revenue 05 - Sales tax 10 - Property tax 15 - Transient occupancy 50 - Charges for services Total Revenue General Fund -Charges for Services Recommended Expenditures General Fund -$77,691,521 Recommended Expenditures General Fund by Object $77,691,521 General Fund Expenditures $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year General Fund Expenditures 05 - Employee compensation 10 - Employee benefits 15 - Materials 20 - Contract services 25 - Cost allocation 45 - Transfer out All Other Categories Expenditures All 3.51%3.40%3.19%3.15%3.09%2.24%2.29% $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Compensation and Benefits 05 - Employee compensation 10 - Employee benefits Expenditures All General Fund Compensation & Benefits $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Materials 05 - Employee compensation 10 - Employee benefits 15 - Materials Expenditures All General Fund Materials $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Contract Services 05 - Employee compensation 10 - Employee benefits 15 - Materials 20 - Contract services Expenditures All General Fund Contract Services $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year Cost Allocation 05 - Employee compensation 10 - Employee benefits 15 - Materials 20 - Contract services 25 - Cost allocation Expenditures All General Fund Cost Allocation General Fund Transfer Out $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 20 Year General Fund Transfers Out 05 - Employee compensation 10 - Employee benefits 15 - Materials 20 - Contract services 25 - Cost allocation 45 - Transfer out Expenditures All Recommended Expenditures All Funds -$105,792,061 Recommended Expenditures All Funds (By object) -$105,792,061 Changes from the FY 2018-19 Adopted Budget Category FY 18-19 Adopted FY 19-20 Proposed Change % Change Employee Compensation $ 23,603,885 $ 23,126,442 $ (477,443)-2% Employee Benefits $ 10,823,413 $ 10,492,587 $ (330,826)-3% Total Personnel Costs Changes $ 34,427,298 $ 33,619,029 $ (808,269)-2% Materials $ 8,177,788 $ 7,777,520 $ (400,268)-5% Contract Services $ 28,378,516 $ 28,769,286 $ 390,770 1% Cost Allocation $ 11,427,121 $ 12,771,790 $ 1,344,669 12% Capital outlays/Special Projects $ 20,524,177 $ 7,183,760 $(13,340,417)-65% Contingencies $ 1,589,249 $ 1,515,791 $ (73,458)-5% Debt Services/Other Uses $ 5,099,298 $ 3,956,047 $ (1,143,251)-22% Transfers Out $ 22,095,412 $ 10,198,838 $(11,896,574)-54% Total All Funds $ 131,718,859 $ 105,792,061 $(25,926,798)-20% General Fund -Fund Balance Forecast General Fund Fund Balance Forecast (Cont.) 1% Salary Increase Fiscal Year (FY) 1% Salary Increase FY20 220,000 FY21 222,000 FY22 224,220 FY23 226,462 FY24 228,727 FY25 231,014 FY26 233,324 FY27 235,657 FY28 238,014 All Funds Subsidy Analysis Council and Commissions Salary and Benefits -$2,164 Materials +36,701 Contract Services +$30,763 Cost Allocation -$6,243 Contingencies +2,583 FY 18-19 Adopted Budget EXPENDITURES $948,652 $1,010,292 $61,640 Category FY 19-20 Proposed Budget Variance Community Funding Requests Non-Profit Organization FY 18-19 FY 19-20 Change Friends of Deer Hollow Farm - White Barn Renovation 15,000$ 15,000$ -$ Rotary - Cupertino Fall Festival 12,000$ 12,000$ -$ Euphrat Museum of Art 10,000$ 10,000$ -$ Bay Area Chrysanthemum - Show N/A-1 1,300$ 1,300$ Cupertino Symphonic Band - Equipment N/A-1 2,000$ 2,000$ Santa Clara Audubon Society - Wildlife & Harvest Day N/A-1 10,000$ 10,000$ Cupertino De Anza Lion's Charities - Ride4Diabetes N/A-1 10,000$ 10,000$ Heart of the Valley - Reaching Hearts N/A-1 7,000$ 7,000$ West Valley Community Services - Pantry Overhang N/A-1 20,000$ 20,000$ Breathe CA - Seniors Breath N/A-1 2,500$ 2,500$ Cupertino Historical Society 15,000$ N/A-2 (15,000)$ Iranian Federated Women's Club 400$ N/A-3 (400)$ TOTAL 52,400$ 89,800$ 37,400$ 1 –Organization did not apply for Community Grant Funding in FY19 2 –Parks and Recreation Commission recommends guaranteed funding to the Cupertino Historical Society each Fiscal Year 3 –Organization did not apply for Community Grant Funding in FY20 Administration Salary and Benefits -$625,822 Contract Services +$1,363,634 Materials +$77,323 Cost Allocation +$47,401 Special Projects -$139,470 Contingencies -$150,976 FY 18-19 Adopted Budget EXPENDITURES $5,939,788 $6,511,878 $572,090 Category FY 19-20 Proposed Budget Variance Special Projects -Administration Special Projects Work Program Costs Public Relations Project X $50,000 Continuity of Operations Contract X $75,000 Total $125,000 Law Enforcement Increased Contract Costs FY 18-19 Adopted Budget EXPENDITURES $12,988,353 $14,077,937 $1,089,584 Category FY 19-20 Proposed Budget Variance Innovation and Technology Salary and Benefits +$12,304 Cost Allocation +$84,559 Materials -$55,184 Contract Services -$493,079 Special Projects -$421,000 Contingencies -$42,948 Other Financing Uses -$146,506 FY 18-19 Adopted Budget EXPENDITURES $7,895,286 $6,833,432 ($1,061,854) Category FY 19-20 Proposed Budget Variance Special Projects –IT Special Project Work Program Costs Cupertino Room Audio/Video Upgrade $155,000 Laserfiche Data WORM Replication $50,000 Plotter and Scanner Replacement $11,000 Building Security and Video X $49,500 Total $265,500 Administrative Services Salary and Benefits -$1,629 Materials +$160,428 Contract Services -$179,542 Cost Allocation -$33,182 Contingencies +45,868 FY 18-19 Adopted Budget EXPENDITURES $6,792,256 $6,784,199 ($8,057) Category FY 19-20 Proposed Budget Variance Parks and Recreation Salary and Benefits -$672,337 Materials -$286,504 Contract Services -$575,603 Cost Allocation +$108,133 Special Projects -$75,500 Contingency -$41,974 Other Financing Uses -$266,780 FY 18-19 Adopted Budget EXPENDITURES $17,442,432 $15,631,867 ($1,810,565) Category FY 19-20 Proposed Budget Variance Special Projects – Parks and Recreation Special Project Work Program Costs Sports & Outdoor Field Use Analysis X $30,500 Health & Safety Equipment $27,000 Total $57,500 Festivals Recreation Facility/ Park/Road Permits Public Works Sheriff Materials Kids 'N Fun Festival Aug. 10, 2019 Taiwanese Cultural and Sports Association 6,000 $1,385 $10,802 $2,871 $5,853 $ 20,911 Fall Festival Sept. 14, 2019 Cupertino Rotary 4,000 $1,472 $6,998 $3,047 $5,853 $ 17,370 Diwali October 10, 2019 Cupertino Chamber of Commerce 5,000 $1,555 $6,710 $3,070 $5,853 $ 17,187 Veteran's Day Nov. 11, 2019 Cupertino Veteran's Memorial 750 $612 $1,000 $18 $1,593 $ 3,223 Ikebana Flower Show March 7-8, 2020 WAFU Ikebana Society 1,000 $294 $19,065 $ 19,359 Egg Hunt April 4, 2020 Home of Christ Church 800 $483 $2,120 $23 $0 $ 2,626 Holi March 29, 2020 Cupertino Chamber of Commerce 2,000 $1,122 $3,000 $18 $965 $ 5,106 Cherry Blossom April 25-26, 2020 Toyokawa Sister City 10,000 $3,496 $17,826 $5,892 $4,826 $ 32,040 World Journal May 9, 2020 World Journal/Cupertino Chinese School 3,000 $1,564 $4,960 $3,043 $4,908 $ 14,475 Tournament of Bands October 11, 2019 Cupertino Tournament of Bands 4,625 $0 $3,220 $3,000 $175 $ 6,395 CEEF 5k Aug. 24, 2019 Cupertino Educational Endowment Fund 1,500 $3,220 $3,000 $6,220 Heroes Run Nov. 2019 County of Santa Clara 1,000 $0 $3,220 $74 $0 $ 3,294 $ 11,983 $ 82,141 $ 18,058 $ 34,258 $ 1,768 $ 148,207 TOTAL $112,181 TOTAL $36,026 Total Waived Fees Festival Date Festival Producer City Expenses Costs for FY 19-20 Events Approximate Attendance Planning and Community Development Salary and Benefits +$60,862 Materials -$201,973 Contract Services +12,720 Cost Allocation +$46,376 Special Projects +$1,403,500 Contingencies -$3,536 Other Financing Uses -$145,000 FY 18-19 Adopted Budget EXPENDITURES $9,476,056 $10,649,005 $1,172,949 Category FY 19-20 Proposed Budget Variance Special Projects –Planning and Community Development Special Project Work Program Costs Short-Term Rentals Outreach X $8,500 General Plan Update X $1,000,000 Urban Village $250,000 MuniCode Updates X $25,000 Dark Sky X $5,000 Housing Strategies X $20,000 Homelessness X $10,000 ELI Housing Units X $150,000 Green Building Code Standards X $35,000 $1,503,500 Public Works Salary and Benefits +$765,734 Materials -$114,284 Contact Services -$1,426,418 Cost Allocation +1,112,084 Special Projects -$3,024,790 Contingencies +$124,957 Other Financing Uses -$588,365 Capital Outlays -$734,329 FY 18-19 Adopted Budget EXPENDITURES $34,629,686 $30,744,275 ($3,885,411) Category FY 19-20 Proposed Budget Variance Special Projects –Public Works Special Project Work Program Costs Solid Waste Hauler Franchise Agreement $250,000 Office Reconfigurations $75,000 Kennedy Middle School Field Maintenance $19,500 BBF Windmill & Fence Refinishing $12,610 Annual Sidewalk, Curb, and Gutter $1,100,000 Pavement Maintenance $2,000,000 Street Tree Maintenance $12,000 Quinlan Community Center Reception Remodel $40,000 Senior Center Exterior Deck Resealing $12,000 Environmental Education Center HVAC $30,000 Sports Center Water Bottle Filler/Fountains $14,000 Special Projects –Public Works Special Project (Cont.)Work Program Costs Infinity Room Glass Door Installation $17,000 Torre Ave Streelight LED Upgrade $11,500 Traffic Box Art Coating $7,500 Vehicle Replacement $594,100 Total $4,195,210 Non-Departmental * This table does not include Capital Reserve transfers out. FY 18-19 Adopted Budget EXPENDITURES $25,264,850 $13,371,676 ($11,893,174) Category FY 19-20 Proposed Budget Variance CIP FY 18-19 Adopted Budget EXPENDITURES $10,341,500 $177,500 ($10,164,000) Category FY 19-20 Proposed Budget Variance Additional Proposals On-Demand Community Shuttle Bus Pilot Program -$2.4M FY 2019-20 Staffing Requests Current FTEs 201.75 Recommended FTEs 202.25 *Accounting Technician was not included in Proposed Budget as the Audit Committee did not approve staff recommendation until April 24, 2019 Department(s)Classification Salaries Benefits Total Costs Funding Source/Purpose Public Works Senior Office Assistant $64,725 $37,772 $102,497 General Fund Replace 2 part-time staff currently working on administrative duties Public Works Maintenance Worker I/II $60,267 $36,796 $97,063 General Fund Street Tree Maintenance Program Administrative Services Accounting Technician*$87,975 $44,720 $132,695 General Fund Intradivisional re-org and segregation of duties to implement internal control enhancements Issues and Challenges Retirement Costs Discount Rate from 7.5% to 7% Revenue Volatility Maintaining Existing Talent Health Benefits Capital Project Funding Next Steps FY 2018-19 Third Quarter Report May 21st FY 2019-20 CIP Presentation May 13th Hearing and Adoption June 18th First Quarter Report Nov 2019 Accessing the Budget Online at www.cupertino.org/budget On the City’s transparency portal www.cupertino.org/opengov Copies available at City Hall and the Cupertino Library Study Session Objective ●Receive comments and questions from Council and Public ●Gather requests and return with updates for Final Budget Hearing when Council will vote on the Final Budget Questions?