Fiscal Year 2013-2015 Special Budget Meeting

Page 8 FY 2013-2015 BUDGET HIGHLIGHTS Revenue Adjustments In addition to the revised revenue estimates in March 2013, the proposed General Purpose Fund budget includes additional revenue increases as follows:  $445,124 increases in service charges and fees each year  Billboard revenue; $500,000 one-time for the first year plus $475,000 each year on-going  $400,000 revenue from former Redevelopment Agency per year due to debt refinancing plan  For FY 2014-15, $2 million one-time revenue from parking ticket backlog by implementing booting vehicles that have multiple unpaid parking tickets  $4 million property sales - implementation of asset management plan in the second year  Use of $10.81 million (net) from the General Purpose Fund to balance the two-year budget for on-going operating expenditures Use of One-Time vs. Ongoing Revenue Sources While recurring, one-time revenue sources are variable by nature, and to the greatest extent possible should not be relied upon to meet predictable ongoing expenses. As stated before, as a best practice, our goal is to use one-time resources or revenues to meet one-time costs for programs or projects. However, as a policy objective, it is reasonable to assume that each year about 3% of revenues will come from variable, one-time sources, which should be used to meet one-time expenses (such as large purchases of equipment or technology upgrades). The charts below summarize revenues and expenditures for the two-year budget, showing the amounts and percentages of one-time revenues and expenditures vs. ongoing revenues and expenditures. This proposed Policy Budget reduces the City’s reliance on the use of one-time dollars for on-going expenditures. For example, for FY 2012-2013, the City used approximately $14.3 million of one-time dollars for on-going expenditures; however, for FYs 2013-2014 and 2014-2015, it is proposed that the City use approximately $10.83 million over both years for on-going expenditures. To the extent that on-going revenues are generated to cover these costs during the year, they will be replaced accordingly to further advance this fiscal priority. On the expenditure side, in FY 2013-14, $5.4 million or 1.26% of the $430.16 million in expenditures are one-time reductions. In FY 2014-15, $5.90 million or 1.29% of the $457.40 million are one-time reductions (see summary below). Table 6: Comparison of Ongoing vs. One Time Revenues and Expenditures FY 2013-14 $430.16 million Total Revenue: $430.16 million Total Expenditures: $.5 million one-time revenue (.12% of total) $5.4 million one-time exp. reduction (1.26% of total) $429.66 million ongoing revenue (99.88% of total) $424.76 million ongoing exp. (98.74% of total) [Net of $1.16 million of fund balance to be programed For balancing 2014-15) FY 2014-15 $457.40 million Total Revenue: $457.40 million Total Expenditures: $6.0 million one-time revenue (1.31% of total) $5.9 million one-time exp. reduction (1.29% of total) $11.97 million fund balance (2.62% of total) $439.44 million ongoing revenue (96.07% of total) $451.50 million ongoing exp. (98.71% of total)