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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />SEPTEMBER 20, 2016 <br />TITLE: <br />APPROPRIATION ADJUSTMENT FOR <br />GRAFFITI ABATEMENT SERVICES AND <br />REDUCTION IN ENTERPRISE FUND <br />ASSESSMENT (STRATEGIC PLAN NO. 4) <br />CITY MANAGER <br />CLERK OF COUNCIL USE ONLY: <br />G"• -R <br />❑ As Recommended <br />❑ <br />As Amended <br />❑ <br />Ordinance on 1't Reading <br />❑ <br />Ordinance on 2nd Reading <br />❑ <br />Implementing Resolution <br />❑ <br />Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />1. Approve an Appropriation Adjustment reducing the Fiscal Year 2016 -17 budgeted <br />appropriation for the Sanitation Fund in the amount of $1,601,440. <br />2. Authorize expenditures related to Graffiti Abatement Services for Fiscal Year 2016 -17, in <br />the amount of $1,200,000, within the General Fund. <br />3. Direct Staff to calculate a Sanitation rate reduction corresponding to the reduction in <br />Appropriation and related Expenditures recommended for the Sanitation Fund. <br />4. Direct Staff to reduce an assessment from the Water Enterprise Fund to the General Fund <br />for Fiscal Year 2016 -17 by $2,388,082. <br />DISCUSSION <br />The City's Water Enterprise (Enterprise) is a vast operation which supplies the City's residents <br />and businesses clean water via an infrastructure consisting of 20 wells, 27 pumps, 8 reservoirs, <br />and 7 imported water connections. As a result of this infrastructure the Enterprise utilizes <br />existing Non - Enterprise City of Santa Ana assets and services including but not limited to: Public <br />Safety, Capital Assets, and Right of Way maintenance. However, staff has identified a reduction <br />in the assessment to the Enterprise which can be applied during the current fiscal year (2016 -17). <br />As a result of recent cost allocation studies, staff recommends to reduce the assessment by <br />$2,388,082. The proposed reduction in the assessment will result in total revenue and <br />expenditure to be received and incurred respectively in the amount of $4,537,918 for both the <br />General Fund and Water Fund. As a percentage of revenue for the General Fund, the revised <br />assessment to the Enterprise, since fiscal year 1993 -94, is at a 22 year low and approximates <br />2% of General Fund total revenues. The reduction in the assessment to the Enterprise will result <br />in approximately $2,388,082 available for funding of capital /infrastructure improvement projects. <br />20A -1 <br />