75A - PH 2013-2015_BUDGET_SUMMARY

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MAYOR Miguel A. Pulido MAYOR PRO TEM Sal Tinajero COUNCILMEMBERS Angelica Amezcua P. David Benavides Michele Martinez Roman Reyna Vince Sarmiento June 3, 2013 CITY OF SANTA ANA 20 Civic Center Plaza . P.O. Box 1988 Santa Ana, Callfomia 92702 Honorable Mayor and City Council Members: We are pleased to submit the two -year budget for the City of Santa Ana for the 2013.2014 and 2014- 2015 fiscal years. The recommended budget continues the path to fiscal sustainability as a result of the collaborative effort among the City Council, City Management and various bargaining groups that occurred over the past several years. These efforts resulted in $11.4M in bargaining group concessions (of which $7.4 million were deferrals) and the outsourcing of the Fire Department to the Orange County Fire Authority. The two -year budget maintains the continued commitment of the adopted fiscal policy that requires that ongoing revenues meet ongoing expenditures and that the City continues to build on its established reserve level. The recommended budget still reflects the effects of the worst recession this country has seen since the days of the Great Depression, the continued struggle with State as it relates to the elimination of Redevelopment Agencies, and a retirement system whose limitations will be at the detriment of government agencies through higher pension costs. As such, the City still faces challenges in the coming years given the moderate economic growth forecasted for the general economy. The budget is fragile at best and makes the next two years critical in maintaining a sound financial footing as the City embarks on a strategic planning process to identify critical community priorities as well as operational efficiencies and needs. Picral Raalitiac The City was tremendously impacted by the worst recession in American history which began in December of 2007. The resulting effect was significant declines in the City's revenue tax base. The City of Santa Ana experienced a structural loss of $18.2 million or 14 % of its major General Fund revenues that included Sales Tax, Property Tax, and Utility Users Tax. As a result, the City's total General Fund budget dropped from $243.1 million to $196,5 million in three years. To balance the budget the City Council stood firm and made many difficult decisions that included outsourcing services such as graffiti, park maintenance, janitorial, street sweeping and most significantly the Fire Department. It merged Parks and Recreation with the Library, eliminated almost 500 positions, and depleted General Fund reserves to almost $3 million. Even with all these difficult choices the City sought the cooperation of the various bargaining groups who joined in assisting the City by negotiating both structural and deferred concessions totaling $11.4M. INTERIM CITY MANAGER Kevin O'Rourke X71 CITY ATTORNEY Sonia R. Carvalho {' CLERK OF THE COUNCIL Maria D. Huizar CITY OF SANTA ANA 20 Civic Center Plaza . P.O. Box 1988 Santa Ana, Callfomia 92702 Honorable Mayor and City Council Members: We are pleased to submit the two -year budget for the City of Santa Ana for the 2013.2014 and 2014- 2015 fiscal years. The recommended budget continues the path to fiscal sustainability as a result of the collaborative effort among the City Council, City Management and various bargaining groups that occurred over the past several years. These efforts resulted in $11.4M in bargaining group concessions (of which $7.4 million were deferrals) and the outsourcing of the Fire Department to the Orange County Fire Authority. The two -year budget maintains the continued commitment of the adopted fiscal policy that requires that ongoing revenues meet ongoing expenditures and that the City continues to build on its established reserve level. The recommended budget still reflects the effects of the worst recession this country has seen since the days of the Great Depression, the continued struggle with State as it relates to the elimination of Redevelopment Agencies, and a retirement system whose limitations will be at the detriment of government agencies through higher pension costs. As such, the City still faces challenges in the coming years given the moderate economic growth forecasted for the general economy. The budget is fragile at best and makes the next two years critical in maintaining a sound financial footing as the City embarks on a strategic planning process to identify critical community priorities as well as operational efficiencies and needs. Picral Raalitiac The City was tremendously impacted by the worst recession in American history which began in December of 2007. The resulting effect was significant declines in the City's revenue tax base. The City of Santa Ana experienced a structural loss of $18.2 million or 14 % of its major General Fund revenues that included Sales Tax, Property Tax, and Utility Users Tax. As a result, the City's total General Fund budget dropped from $243.1 million to $196,5 million in three years. To balance the budget the City Council stood firm and made many difficult decisions that included outsourcing services such as graffiti, park maintenance, janitorial, street sweeping and most significantly the Fire Department. It merged Parks and Recreation with the Library, eliminated almost 500 positions, and depleted General Fund reserves to almost $3 million. Even with all these difficult choices the City sought the cooperation of the various bargaining groups who joined in assisting the City by negotiating both structural and deferred concessions totaling $11.4M.