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Home My WebLink AboutPresentation - Item #22EARLY BUDGET DIRECTIONFY 2023 -24 City Council Meeting April 18 ,2023 BUDGET CYCLE •Early budget information to Council •Council direction only -no act ion⚬Provides staff with insight to build the bud ge t⚬Answer specific budget policy questions PURPOSE OF EARLY DIRECTION ENGAGEMENTTOOLS •13 Question Community Budget Priorities Survey ⚬Simulate: Respondents can adjust current General Fund spending⚬Prioritize: Respondents can select and rank defined projects and initiatives within a budget •Budget Engagement Simulation Tool (Best) Community Budget Forums in all Council Wards ENGAGEMENTOPPORTUNITIES Three Community-wide events Virtual forums with Youth Planning Commission and KidWorks PUBLIC INPUT SOLICITATION MEASURE X COMMITTEE RECOMMENDATIONS (Ranked) •Inform homeless community members about available services •Address homelessness -related issues •Coordination with surrounding cities and County governments to address homelessness •More affordable housing •Clean-up homeless encampments MEASURE X COMMITTEE RECOMMENDATIONS (Ranked) MEASURE X COMMITTEE RECOMMENDATIONS (Ranked) MEASURE X COMMITTEE RECOMMENDATIONS (Ranked) MEASURE X COMMITTEE RECOMMENDATIONS (Ranked) INITIAL PUBLIC INPUT To date we have received 796 responses from survey and simulation tools. Trending responses shown here. Invest in homeless- reduction programs Improve City parks •City should acquire vacant lots, properties to expand existing parks or create new parks and dog parks •Improvements to existing parks (cameras, playground/recreation equipment) •Regular playground maintenance •Cameras and better lighting at parks to enhance safety Invest in crime-reduction programs •More gang prevention programs •PAAL program expansion •Fund afterschool and educational programs for youth Street Maintenance / Traffic Improvements •More frequent street maintenance •Fill potholes •Alternatives to traffic calming •Repave alleys and city -owned parking lots •Sidewalks and pavement maintenance Library Investments •Additional libraries •After school programs for youth FAVOR ONE-TIME SPENDING FROM MEASURE X REVENUE 1 CONSIDER PROGRAMS TO USE COMMUNITY-BASED PROFESSIONALS VS. SWORN OFFICERS TO RESPOND TO NON-VIOLENT POLICE CALLS 2 EXPLORE ESTABLISHING A MEASURE X SUNSET STABILIZATION FUND3 PREPARE A LONG-TERM PLAN TO PREPARE FOR MEASURE X RATE REDUCTION4 SHIFT MEASURE X REVENUE TO FIXING STREETS5 MEASURE X COMMITTEE RECOMMENDATIONS 6 INCREASE SALES TAX COMPLIANCE FOR MOBILE FOOD VENDORS THROUGH REGISTRATION AND EDUCATION EFFORTS GENERAL FUND REVENUE EXPECTATIONS Business License Tax Sales Tax (40% of budget) Assume flat for now until m ore info available in May •Used consultant’s “Most Lik e ly” Scenario•Higher interest rates have slo w ed car sales•Continued global supply chain challenges•Concerns about future rec e ssion Proposed fee increase o f 4 .1% Based on the compensation increase for staff providing the services All Other revenues may increase by 3.8% Some examples include charges for services & franchise fees Property Tax (24% of budget) •Prop 13 growth of 2% max•Re -assessed values for properties sold contributes to the growth above 2%•Sales activity has decreased•City receives an average of 18.4 5% of the 1% assessment Cannabis Tax Assume reduction of $8M for now, until more info available in May TOTAL ESTIMATED REVENUES OF $399.8 MILLION FOR FY 2023 -24 -SUBJECT TO CHANGE FY 2023-24 BASELINE BUDGET FY 2022 -23 Adjusted Budget -Removed One-time Items+Full-time funding for items added in FY 2022-23 with partial funding+Employee compensation increases (Step Increases & Labor Agreements)-Adjustments for Debt Payments+Tr a nsfer to Pension Stabilization+Adjustments for Overhead Allocations+Fire & Ambulance contract increases =Baseline Budget for FY2023-24 Estim ated Recurring of $397.3 m illion UPDATED 10 -YEAR OUTLOOK Includes: •Baseline Budget, before adjustments •Debt pay -offs •Measure X rate decrease⚬1.5% to 1.0% in 2029 •CPI increases FY24 -25 an d later •OC Streetcar ops begin FY24-25 Does not include : •Impact of potential future recession •New services •Potential revenue increases from new development Summary of the General Fund Balance General Fund Estimated Ending Balance at June 30, 2023, adjusted for non-cash activities $101,495,809 Less 18% Reserve $(71,967,831) Estimated Spendable Balance $29,527,978 Planned Additions to FY23-24 Budget: Third & Broadway Development Contractual Obligation $(13,000,000) Right-of-way maintenance to cover Gas Tax revenue reduction to preserve current service levels $(700,000) Potential Special Elections $(1,000,000) Climate Action Plan $(750,000) Downtown Santa Ana Parking Subsidy $(1,862,320) Estimated Available for One-Time Spending $12,215,658 Event Spending Should event funding be adjusted? Most Recent Actual Estimated Attendance Cost Per Fourth of July $75,006 7,500 $10.00 Juneteenth $78,307 800 $97.88 Fiestas Patrias $297,620 60,000 $4.96 Egg Hunt $37,335 5,000 $7.47 Movies In the Park (13)$116,684 9,750 $11.97 Summer Concert Series (4)$42,336 2,400 $17.64 Birch Series (summer & fall movies, Shakespeare in the Park)$31,835 2,700 $11.79 Indigenous Peoples Day $66,266 250 $265.06 Chicano Heritage $65,609 6,000 $10.93 Winter Village $896,147 35,000 $25.60 Autumn Festival $42,967 3,500 $12.28 5K $59,958 821 $73.03 Updated UNFUNDED EMPLOYEE PENSION LIABILITY COST-REDUCTION POLICY “It shall be the City’s policy to consider an additional discretionary payment to reduce the unfunded pension liability during each annual budget process” Shall we add any discretionary payments from one -time money? UNFUNDED EMPLOYEE PENSION LIABILITY COST-REDUCTION POLICY Cannabis Public Benefit Fund -Summary Staff is in process of fine-tuning this budget, but we need more data from tax remittances after the rate reductions became effective January 1, 2023 FY 2023 -24 BUDGET UPDATES New Rent Stabilization Program/Fee/Fund -FY 2023-24 budget will include a new fund for Rent Stabilization. To be funded with a new fee to cover staff costs of operating the program, including legal, housing and adm inistration. Com m unity Developm ent will bring an item to Council by June. Civic Center Modernization –City will receive $9 m illion from the state for Modernization of the Civic Center. This grant will be used for acquisition of the state building and related costs. Receipt of the funding enables us to fulfill Senator Um b e rg ’s request to provide $1.5 m illion of direct assistance to downtown businesses. OPIOID SETTLEMENTS PAYMENTS Santa Ana may receive a total of $11.4 m illion, with a large share being received over a period of 7 years and the reaming over 18 Ye a rs Total Funding To date, we have received $1,128,302 Total Received •Purchase Naloxone or sim ilar •M edication -assisted and other opioid related treatment •Treatment for pregnant & postpartum women •Treatment for neonatal abstinence syndrome •Warm hand -off a n d recovery program s •Treatment for those inc a rcerated •Prevention program s The money is restricted to treatment and prevention program s, with priority given to: •Prevention progra m s •Syringe service prog ra m s •Data collection and ana ly sis of effectiveness of abatement strategies Would City Council like to provide direction for spending preferences? Next Steps •Council work sessions during regular meetings on May 2 and May 16 •Optional dedicated workshop on May 11 •Draft budget and CIP presentations •Continue gathering public input •Complete internal process and develop recommendations QUESTIONS?