Item 20 - City Council Fiscal Year 2021-22 Budget Workshop Session

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City Council Fiscal Year 2021-22 Budget Workshop Session May 4, 2021 Page 4 The updated Ten -Year Outlook includes the FY20-21 budget structure at March 31 (the third quarter update) and the draft FY21-22 budget, along with the following assumptions. • Revenues and expenditures increase annually by the CPI as forecasted by the California Department of Finance. • Savings from Pension Debt Refinancing has not yet been included in the Outlook. • City revenue makes a full recovery from the pandemic during FY22-23. • The final jail module begins producing revenue during FY22-23. • The Measure X tax rate decrease from 1.5% to 1.0% in FY28-29. • The City pays off the debt for the Police facility in 2024. Measure X Oversight Committee Recommendations Voter approved Ordinance NS-2952 requires a "...citizen oversight committee to act in an advisory role to the City Council in reviewing the annual revenue and expenditures of funds from the tax..." Committee establishing Resolution 2019-008 requires "During its March meeting, the Committee shall prepare an annual report to City Council, including recommendations, in time for City Council consideration during the budget process for the upcoming fiscal year." The Committee met on March 10, 2021 and prepared the following recommendations for the FY 2021-22 budget, in accordance with establishing Resolution No. 2019-008. 1. Favor one-time spending from Measure X revenue. a. Remember, Measure X is temporary. b. Focusing in on one time spending will reduce reliance upon Measure X revenue for future minimum/expected service levels. 2. Consider the following pilot programs: a. Community based professionals/specialists vs. sworn Police for non- violent response such as substance abuse, mental health crisis and small neighborhood disputes in order to control costs and improve results; and/or b. Seed economic development such as community cooperatives to provide future revenue growth and stimulate the local economy. 3. Prepare a long-term plan to prepare for the Measure X rate reduction. a. Focus on the temporary nature of Measure X and prepare for the phase- out of such revenue on service levels. b. The plan should identify areas where Measure X is supporting recurring spending instead of one-time use of revenue. 4. Shift Measure X revenue to fixing streets. a. This is one of the most visual items for the public. b. This is one of the areas that has not been funded historically with Measure X. c. This is one time use of funds. 5. Use Measure X revenue increase to reduce the reliance on the General Fund Reserve to preserve service levels.