Item 40 - Refinancing City’s Pension Obligations with California Public Employees Retirement System

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25 4826-7904-2280v7/200434-0005 respective budgets. From March to April, the budget team meets with department representatives to review, discuss & plan the anticipated goals for the upcoming fiscal year. The City holds community budget meetings in March and April where information about the budget process is provided to the community and community input is gathered. In May, the City Manager presents a long-term financial outlook to the City Council. The purpose of the outlook is to ensure that the City’s financial environment is stable, efficient and transparent, and to ensure the organization’s long-term financial viability. Based upon City Council budget priorities, the Executive Management Team reviews operating budgets and Capital Improvements Program requests. The budget team evaluates and prioritizes the program requirements, determines funding availability and develops a balanced budget. Final budget decisions are made according to the purpose, vision and goals of the City. Between April and June, the City Manager conducts individual meetings with each City Councilmember for review of the budget and economic conditions overview. The purpose of these sessions is to support the preparation of the upcoming budget and provide a status of the current year’s budget and preliminary projections of General Fund revenues and expenditures. A public hearing notice is published in a local publication in May. During this public hearing, the proposed budget is presented to the City Council and any new changes are incorporated into the budget. Copies of the line-item budget, as presented in the proposed budget document, are made available to the public. After the conclusion of the public hearing, the City Council may further consider the proposed budget and make any revisions thereof that it may deem advisable. On or before the 30th day of June, the City Council meets to adopt the proposed budget, as amended, by the affirmative vote of a majority of the City Council. Pursuant to the City charter, the City Council must adopt a budget by no later than July 31. Upon final adoption, the budget will be in effect for the ensuing fiscal year. The adopted budget becomes the authority for the various departments to expend appropriations, subject to controls established by the City charter. A copy of the adopted budget, certified by the Clerk of the Council, must be reproduced and copies made available for the use of all officers, offices, departments, and other agencies of the City and for the use of civic organizations. The City may amend the budget during the fiscal year by an appropriation adjustment. This action requires a supermajority City Council vote. The need to amend or adjust the budget typically arises in response to unforeseen circumstances or events. If the request for an appropriation adjustment is a shift of budget between two different departments and/or involves more than one fund, then City Council approval is required. The City Manager has the authorization to amend City Council–approved appropriations if the amendment is to shift budget within a single department and fund. The City Manager is not authorized to increase the overall budget. Fiscal Year 2020 Budget. The City Council adopted the Fiscal Year 2020 budget on July 2, 2019. Budgeted expenditures for the General Fund totaled approximately $316.1 million for Fiscal Year 2020. Actual expenditures for the General Fund totaled approximately $310.9 million, or approximately $5.3 million or 1.7% lower than budgeted. Original budgeted revenues for the General Fund totaled approximately $316.1 million for Fiscal Year 2020. Actual revenues for the General Fund totaled approximately $325.7 million, or approximately $9 million or 2.8% more than the original budget. See the caption “THE CITY—COVID-19 Outbreak.” Fiscal Year 2021 Budget. The City Council adopted a budget for Fiscal Year 2021 on July 7, 2020 which took into account the effects of the COVID-19 outbreak. Budgeted expenditures for the General Fund total approximately $325.9 million for Fiscal Year 2021, an increase of approximately $14.2 million (4.6%) more than the Fiscal Year 2020 adjusted budgeted expenditures. Budgeted revenues for the General Fund total approximately $307.4 million for Fiscal Year 2021, a decrease of approximately $8.1 million (2.6%) below the adjusted estimate for Fiscal Year 2020 revenues. The Fiscal Year 2021 original budget projected an ending General Fund balance of approximately $52.3 million (including transfers out), a decrease of approximately $18.6 million from the projected beginning General Fund balance of approximately $70.8 million.