Fiscal Year 2013-2015 Special Budget Meeting

Page 10 FY 2013-2015 BUDGET HIGHLIGHTS Other Budget Challenges - Fiscal Uncertainties Oakland faces uncertainties when it comes to financial planning; these include:  Changes in federal spending (e.g., sequestration);  Changes in state spending;  Measure Y and Wildfire Prevention Assessment District renewal and the impact FYs 2015-17;  Slower than expected economic recovery;  Redevelopment “clawback”;  CalPERS reforms that it will put in place over the next six years;  Affordable Care Act during the term of this proposed budget, with fiscal impacts not yet settled and an abundance of questions yet to be resolved;  Five years of structural deficit forecasted;  $1B+ of unfunded liabilities and/or deferred capital projects;  Implementation of the Negotiated Settlement Agreement (NSA) and police staffing; and,  Potential liabilities. General Purpose Fund (Fund Balance as of March 2013) City Council policy mandates that the City set aside 7.5% of the General Purpose Fund budgeted expenditures into a General Fund Reserve. Last year, FY 2011-12, was the first time in five years that the reserve fund had been fully funded at $30.2 million. As of March 2013, the General Fund Reserve balance was $84.6 million. When accounting for City Council appropriations and other expenditures made from the fund balance, as detailed below, the net available “undesignated” fund balance is $32.5 million. Table 9: General Purpose Fund Reserve/Undesignated Fund Balance Gross Ending Fund Balance: $84.6 million Costs related to Redevelopment dissolution, one-time funds to balance FY 2012-13 budget, carry-forwards and encumbrances - $18 million Net Fund Balance $66.6 million 7.5% GPF reserve per City Council policy - $30.2 million Net Available Ending Fund Balance $36.4 million City Council-approved or recognized revenues/expenditures Dec 2012 – June 2013 - $3.9 million General Purpose Fund Undesignated Fund Balance $32.5 million Note: Does not account for anticipated expenditures in FYs 2012-2013 or 2013-2015 (see next section).