CC 04-28-2020 #1 Fiscal Update and Preview_Staff PresentationCC 04-28-20
#1 COVID-19 Fiscal
Impacts Update
Presentation
CC 4/28/20, #1
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April 28, 2020
Fiscal Year 2019-20 Update and
Fiscal Year 2020-21 Preview
Agenda
Fiscal Year 2019-20 Update
Fiscal Year 2020-21 Preview
Budget Cycle
Budget Calendar
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Fiscal Year 2019-20 Update
Important Considerations FY 2019-20
•COVID-19 Impacts
•Sharp Revenue Drops
•Recession and
•Uncertainty
•General Fund Focus
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Important Considerations FY 2019/20
•Estimates, not actuals
•Soft hiring freeze
•Departments asked to reduce costs in
special projects
•All Capital Improvement Projects
remain funded
COVID-19 Impact FY 2019-20 General Fund
(in millions)
Category FY19/20
Year-End
Projection
FY19/20
COVID-19
Impacts
FY19/20
Year-End
COVID-19
Impacts
Mitigated
FY19-20 Beginning Unassigned Fund Balance $28M
Revenues $93.4M $82.1M $92.1M
Expenditures $108.3M $108.3M $102.6M
Impact to Fund Balance -$14.9M -$26.2M -$10.5M
FY19-20 Estimated Ending Unassigned Fund
Balance
$13.1M $1.8M $17.5M
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General Fund Forecast - COVID-19 Impacts
$93.4
$82.1 $92.1
$108.3 $108.3 $102.6
$13.1
$1.8
$17.5
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
FY20 Year‐End
Projection
FY20 Year‐End
COVID‐19 Impacts
FY20 Year End
COVID‐19 Impacts
Mitigated
Revenue Expenditure Estimated Ending Unassigned Fund Balance
Revenue Category Description Amount
FY 19/20 Year End Revenue Estimates Pre-COVID 19 $93.4
Transient Occupancy Tax (TOT)COVID 19 related loss in
revenue
-$3.7
Charges for Services -$4.0
Miscellaneous Revenue -$2.5
Fines and Forfeitures, and Other
Financing Sources
-$1.0
COVID-19 Revenue Impacts Total -$11.3
Transfer In COVID 19 related transfer in
from Capital Reserve to offset
Revenue Losses
$10.0
FY19/20 Year End Revenue Estimates COVID-19 Impact Mitigated $ 92.1
Changes to General Fund Revenue Estimates
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Expenditure Category Description Amount
Salary and Benefits Based on Historic Budget Savings - $1.42
Materials -$2.10
Contracts -$1.80
Contingencies -$1.00
Other Financing Uses -$0.60
FY 20 Year-End Expenditure Projection $108.3
Special Projects COVID 19-related expenditure
reduction -$5.50
Salary and Benefits COVID 19-related expenditure
reduction thru furloughs -$0.18
FY20 Year End Expenditure Estimates Post-COVID 19 $ 102.6
Changes to General Fund Expenditure Estimates
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Employee Type 3/17-4/10
Actuals
4/11-5/1
Estimate
5/2-5/30
Estimate
5/31-6/30
Estimate
Grand Total
Estimate
EE Hours Costs EE Hours Costs Hours Costs Hours Costs Hours Costs
Full Time 88 9,166 $340,978 78 3,412 $129,389 4,550 $172,518 5,233 $198,396 22,361 $841,281
Part Time 77 3,311 $67,134 0 0 $0 0 $0 0 $0 3,311 $67,134
Total Employees 165 12,477 $408,112 78 3,412 $129,389 4,550 $172,518 5,233 $198,396 25,672 $908,415
Labor Cost Impacts
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Fiscal 20-21 Preview
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FY 2020-21 Themes
BUILDING ON A
STRONG FISCAL
STRATEGY
POTENTIAL SERVICE
LEVEL IMPACTS
BALANCED
EXPENDITURE
REDUCTIONS
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Budget Balancing Strategies- Revenue
RevenuesStrategy Description Potential
Impact
Revenues
Employer-Based business
license tax
Part of Council work program to tax businesses based
on number of employees, voter approval needed
$10M
¼ cent Sales Tax Voter approval required, would bring sales tax from 9%
to 9.25% for the City
$3-4M
Transient Occupancy Tax Voter Approval required, could bring rate from 12% TO
14%
$2M
Potential Strategy Description Potential
Impact
Expenditures
Section 115 Trust Smoothing mechanism for years when CalPERS does not
meet discount rate projections or assumption changes.
Can also be used to offset pension costs in any given year.
Fund is
currently at
$12M
Salary and benefit
savings through
attrition
Keep non-essential positions unfilled as they become vacant.
$160,000 on
average/
vacancy
No new positions Cost containment strategy $0
Reduction in capital
outlays and special
projects
Cost containment strategy Up to $1.5
million
Reduction in
contingencies by
half
Cost containment strategy Up to $850,000
Budget Balancing Strategies- Expenditures
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COVID-19 Impact FY 2020-21 (in millions)
Category FY20/21
Proposed
Budget
FY20/21
COVID-19
Impacts
FY20/21
Proposed
COVID-19
Impacts
Mitigated
FY20/21 Estimated Beginning Unassigned Fund
Balance
$17.5M
Revenues $88.8M $79.5M $79.5M
Expenditures $89.5M $89.5M $79.8M
Impact to Fund Balance -$0.7M -$10.0M -$0.3M
FY20-21 Estimated Ending Unassigned Fund
Balance
$16.8M $7.5M $17.2M
$88.8
$79.5 $79.5
$89.5 $89.5
$79.8
$16.8
$7.5
$17.2
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
$90.0
$100.0
FY20/21 Proposed Budget FY20/21 COVID-19 Budget
Impacts
FY20/21 Proposed Budget
Impacts Mitigated
General Fund Proposed Budget – COVID-19 Impacts
Revenue Expenditure Fund Balance
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FY20/21 Balancing Strategy
VACANCY SAVINGS CUTS ACROSS VARIOUS
EXPENDITURE
CATEGORIES
EARMARKED RESERVES
UNTOUCHED
COVID Fiscal
Update
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Budget Cycle
Proposed Budget
May
Final Budget
June/July
First Quarter
November
Mid-Year
February/March
Third Quarter
May
COVID Fiscal
Update
Next Steps
●FY 2019-20
●Third Quarter Report to Council May 19, 2020
●FY 20-21
●Proposed Budget Printed May 1, 2020
●Proposed Budget Hearing May 19, 2020
●CIP Prioritization June 2, 2020
●Final Budget Hearing June 16, 2020
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Questions?
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