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CITY OF SANTA ANA <br />NOTES TO APPROPRIATIONS LIMIT WORKSHEETNO. 6 <br />For the year ended June 30, 2016 <br />1. PURPOSE OF LIMITED PROCEDURES REVIEW: <br />Under Article X11I13 of the California Constitution (the Gann Spending Limitation Initiative), <br />California governmental agencies are restricted as to the amount of annual appropriations from <br />proceeds of taxes. Effective for years beginning on or after July 1, 1990, under Section 1.5 of <br />Article XIIIB, the annual calculation of the appropriations limit is subject to a limited procedures <br />review in connection with the annual audit. <br />2. METHOD OF CALCULATION: <br />Under Section 10.5 of Article XIIIB, for fiscal years beginning on or after July 1, 1990, the <br />appropriations limit is required to be calculated based on the limit for the fiscal year 1986-87, <br />adjusted for the inflation and population factors discussed at Notes 3 and 4 below. <br />3. INFLATION FACTORS: <br />A California governmental agency may adjust its appropriations limit by either the annual <br />percentage change in the 4th quarter per capita personal income (which percentages are supplied by <br />the State Department of Finance), or the percentage change in the local assessment roll from the <br />preceding year due to the change of local nonresidential construction. The factor adopted by the <br />City of Santa Ana, California (the City) for fiscal year 2015-2016 represents the annual percentage <br />change in the 4th quarter for per capita personal income. <br />4. POPULATION FACTORS: <br />A California governmental agency may adjust its appropriations limit by either the annual <br />percentage change of the jurisdiction's own population, or the annual percentage change in <br />population in the County where the jurisdiction is located. The factor adopted by the City for fiscal <br />year 2015-2016 represents the annual percentage change in population in the County in which the <br />City is located. <br />5. OTHER ADJUSTMENTS: <br />A California government agency may be required to adjust its appropriations limit when certain <br />events occur, such as the transfer of responsibility for municipal services to, or from, another <br />government agency or private entity. The City had no such adjustments for the year ended <br />June 30, 2016. <br />-4- <br />19F-26 <br />