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is needed now...residents and business owners in the future will appreciate the forethought and wisdom of the existing <br /> council. <br /> Thanks for your time and consideration to this matter. Your help with the fiscal health of our city now and into the <br /> future is an integral part of the health of our city. I appreciate all the work you and the city staff, including Director <br /> Down, City Manager Ridge and all of the staff that go under the radar here...this truly is a team effort. As always, I am <br /> available to discuss. <br /> Tim Johnson, CPA <br /> JLK Rosenberger, LLP <br /> (949)860-9892 <br /> (714)743-1065 <br /> From:Tim Johnson <br /> Sent:Thursday, May 12, 2022 11:10 AM <br /> To: Bacerra, Phil <pbacerra@santa-ana.org>; Sarmiento,Vince<vsarmiento@santa-ana.org>;jryanhernandez@santa- <br /> ana.org; Lopez,Jessie<JessieLopez@santa-ana.org>; David Penaloza <dpenaloza@santa-ana.org>; Mendoza, Nelida <br /> <nmendoza@santa-ana.org> <br /> Cc: ecomment@santa-ana.org; Downs, Kathryn <KDowns@santa-ana.org>; Mendoza, Steven <SMendoza@santa- <br /> ana.org>; Ridge, Kristine<kridge@santa-ana.org>; Flores, Rosa <RFlores@santa-ana.org>; Carvalho, Sonia R. <br /> <SCarval ho@santa-ana.org> <br /> Subject: Budget Workshop (5.12.22) <br /> Mayor and Council (cc other important folks)...today you will be having a budget workshop for the upcoming 22/23 fiscal <br /> year. Obviously,there is a lot to consider and we are fortunate that the City's finance team is able to provide you some <br /> really valuable information and you have sought some information from the public also. You will also be receiving the <br /> Measure X Annual Report(MXAR)today. I am on that committee although these comments are my personal comments <br /> since the annual report stands on its own and you should not take my thoughts below to be those of the committee, <br /> although it is very possible,that others or perhaps even all may have similar thoughts. <br /> One of the new recommendations in the MXAR is to consider establishing a Measure X Sunset Stabilization Fund. If you <br /> recall,the council discussed and I believe voted to establish a Pension Stabilization Fund whereby the city would utilize <br /> savings derived from utilizing pension obligation bonds to save for future pension increases so as to be better prepared <br /> in the future to handle increasing costs. I hope that this council can see the need to plan for the future sunset of <br /> Measure X and as such will strongly discuss and hopefully approve the utilization of such a stabilization fund to plan pro- <br /> actively for the sunset of Measure X. <br /> As a reminder a few logistical details about Measure X (MX): <br /> • MX sales tax rate is 1.5% presently through 3/31/29 <br /> • MX tax rate will drop from 1.5%down to 1.0%from 4/1/29 to 3/31/39 <br /> • When approved by the voters MX was expected to generate approx$60M per year <br /> • The most recent budget update as provided at the 5/3/22 council meeting anticipates that MX will generate <br /> approx. $84.2M for FY21-22 <br /> • In just 3 years MX revenue has increased by approximately 40% ($84.2M anticipated MX less$60M baseline MX <br /> /$60M baseline MX) <br /> • The FY22/23 draft projected MX revenue appears to be approx. $92M (see Director Down's current <br /> presentation)which is approx. a 6.8% increase. This is likely not only spurred on by additional spending but also <br /> due to the inflation we are experiencing on taxable goods. <br /> 39 <br />