HomeMy WebLinkAboutCORRESPONDANCE - 65ASalas, Diana
From:
Tim Johnson <tjohnson@jlkrllp.com>
Sent:
Tuesday, February 18, 2020 9:41 AM
To:
eComment
Cc:
Solorio, Jose; Pulido, Miguel; Iglesias, Cecilia; Sarmiento, Vicente; Villegas, Juan;
Penaloza, David; Bacerra, Phil; Ridge, Kristine; Downs, Kathryn
Subject:
65A- Appropriations Adjustments
Council/City Manager/Exec Director Downs ... On tonight's agenda you will be discussing a mid -year budget update and
vote on an appropriations adjustment. First, I am on the Measure X Citizens Oversight Committee but am not writing
this in an official capacity on behalf of the oversight committee but instead am writing on my own behalf.
I am pleased that our revenue is higher than budgeted. This is great news. I would urge you to pause though in
appropriating these funds too early if you feel that all of the needs and options have not been fully vetted. If we
continue to spend every dollar too quickly we may not be making the wisest choices for the community. You have an
opportunity to really determine the right course of action with the funds that are being generated. I believe that the city
should look at all of the needs of the city, put those all on the table, and then discuss them in order to prioritize. One of
those priorities may actually be to increase the reserve in case of a future recession which will no doubt have a major
impact as discussed on page 3 of the staff report (3r4 Paragraph).
Additionally, I would urge you to pause in order to consider whether the Measure X sales tax funds which are
contributing $1.1M of the projected revenue increases. Are you holding yourself to the will of the residents who voted
in this tax increase?
Are you listening to the Measure X Citizens Oversight Committee? I am not sure you are because you have not even
heard from the Committee. If you value the opinion of those who you have appointed, then I believe that you should
want to hear from the Committee. The current budget was approved prior to the X Committee being formed and
therefore they were unable to speak into it and now a mid -year appropriations adjustment is being made even after the
Committee asked to provide a mid -year update and was denied the opportunity to do so because there was no
actionable items... well, here is your actionable item. You are being asked to appropriate over $1M of Measure X
revenue.
Please pause. Read the recession language from page 3 of the staff report which I have pasted a picture of
below. Consider that Measure X is a temporary tax increase and will not last forever even though its sunset seems far
into the future. Consider the entire needs of the city. Make smart financial choices by planning ahead instead of
reacting to a bit of good news by quickly appropriating those funds. Put all the needs of the city on the table, discuss
them, prioritize them, and then vote on them.
The appropriations proposal includes about $229K to general fund priorities including $90K for public works homeless
clean up efforts and SAPID cell phone technology improvements, $89K repairing leaky city hall windows, and $50K for
census outreach. Additionally, there are $6.25M (net) allocation to non -general fund priorities mainly to the capital
street fund (per the Sept 17 council mtg) and $280K for the general plan update. Is there where you want the $6M of
anticipated additional revenue to be allocated? Do you know what other priorities we have? Do you know what the
impact will be on the capital street fund? What streets will be repaired/repaved/redone? Streets are extremely
important but there are folks who want to know what the impact will truly be where the rubber meets the road,
literally.
It should he noted the Gity's sales tax consultant is currently projecting future annual increases of
approximately 2.6% for bath categories of sales tax revenue, However, the consultant does have
recession sceneries that include a 4,3% reduction of revenue In tha first year ofa recession (roughly
$5 million), and another 1.9% reduction in the second year of recession (another $2 million), in
addition to the General Fund operating reserve of 16.673E of annual revenue, the City has a reserve
for economic uncertainty equivalent to 1%of annual revenue or approximately $3.2 million. [wring
the next budget process, ttte City Council may want to consider using, the excess General Fund
balance to increase the reserve for economic uncertainty to at least2% of annual revenue or$6.4
million,
Thank you for all you do for our city. Please feel free to reach out tome with any questions or clarifications, but
unfortunately I will not be able to attend tonight due to a church event.
MRoseliberger
Ce+rtP.MrWkdK Mtrowrunn,
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