HomeMy WebLinkAboutItem 19 - Resolution Establishing the Appropriations Limit of the City of Santa Ana For FY_2025-06 Finance and Management Services
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Item # 19
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
June 17, 2025
TOPIC: Adopt a Resolution Establishing the Appropriations Limit for 2025-26
AGENDA TITLE
Resolution Establishing the Appropriations Limit of the City of Santa Ana For FY 2025-26
RECOMMENDED ACTION
Adopt a resolution establishing the appropriations limit of the City of Santa Ana for Fiscal
Year 2025-26, as required by state law.
RESOLUTION NO. 2025-XXX entitled A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF SANTA ANA ESTABLISHING THE APPROPRIATION LIMIT OF THE
CITY OF SANTA ANA FOR FISCAL YEAR 2025-2026
GOVERNMENT CODE §84308 APPLIES: No
DISCUSSION
The State of California Constitution imposes a limit (“the Gann Limit”) on tax proceeds to
be appropriated for expenditures by a local government in any given fiscal year and
requires the cities establish this limit by resolution. Adoption of the subject resolution is
necessary for compliance with the California constitution for the fiscal year ending June
30, 2026.
Furthermore, Section 13-90 of the Santa Ana Municipal Code requires the creation of a
Reserve Fund for Excess Proceeds of Taxes (Reserve Fund), as a separate accounting
of taxes received in a fiscal year prior to the period of expenditure. The City appropriates
the expenditure of tax revenue in the same fiscal year of receipt, and therefore creation
of the Reserve Fund is not necessary for the fiscal year 2025-26. In fiscal year 2023-24,
the Proceeds of Taxes were $322,141,522 and the actual General Fund expenditures
were $394,675,261.
Using the formula provided by the state, staff calculated the spending limitation from
“Proceeds of Taxes” as $1,522,518,198 (Exhibit 1) for fiscal year 2025-26, which is the
FY24-25 limit increased by 6.66%. The funds constrained by the appropriations limit
include the General Fund, the Capital Outlay Fund, and Special Revenue Funds.
Adopt a Resolution Establishing the Appropriations Limit for 2025-26
June 17, 2025
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Exhibit 1 identifies the factors used to determine the allowable inflationary increase from
the prior year. Exhibit 2 categorizes FY 2025-26 anticipated revenues from “Proceeds of
Taxes” and “Non-Proceeds of Taxes”. Exhibit 3 computes the FY 2025-26 appropriations
subject to this limitation, and identifies the difference between the limit and the budgeted
appropriation. As demonstrated in Exhibit 3, the City’s anticipated fiscal year 2025-26
appropriations subject to limitation is $321,251,348, which is $1,201,266,850 less than
the allowable Gann Limit.
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
There is no fiscal impact associated with this action.
EXHIBIT(S)
1. Computation of Appropriation Limit
2. Schedule to Categorize Anticipated Revenues
3. Appropriation Subject to Limitation
4. Resolution
Submitted By: Alex Trinidad, Acting Executive Director, Finance and Management
Services Agency
Approved By: Alvaro Nuñez, City Manager
Fiscal Year 2024-25 Appropriations Limit $ 1,427,985,554
California Per Capita Personal Income:6.440% *
Converted into a Factor 1.0644
Population Growth:0.17% *
Converted into a Factor:1.0017
Calculation of factor for fiscal year 2024-25 (1.0362 x 1.00310):1.0662
Fiscal Year 2025-26 Appropriations Limit $ 1,522,518,198
* Source: State of California, Department of Finance, Price and Population Information - FY 2025-26
EXHIBIT 1
COMPUTATION OF APPROPRIATION LIMIT
FOR FISCAL YEAR ENDING JUNE 30, 2026
EXHIBIT 1
REVENUE
PROCEEDS OF
TAXES
NON-PROCEEDS OF
TAXES TOTALS
TAXES:
Property Tax $110,300,910 $- $ 110,300,910
Sales Tax 146,662,070 -146,662,070
Hotel Visitors' Tax 9,500,000 -9,500,000
Business Tax 17,500,000 -17,500,000
Documentary Stamp Tax 1,200,000 -1,200,000
Utility Users' Tax 29,250,000 -29,250,000
Medical Marijuana/Cannabis Tax 12,651,460 -12,651,460
Total Taxes 327,064,440 -327,064,440
FROM STATE:
State Motor Vehicle License 400,000 - 400,000
Homeowner Prop Tax Subvention 180,000 - 180,000
State Gas Tax - 16,930,360 16,930,360
SB90 Reimbursements - 150,000 150,000
State Grants - 3,646,580 3,646,580
Standards Training for Corrections Reimbursement - 55,760 55,760
Total State 580,000 20,782,700 21,362,700
OTHER GOVERNMENT:
Community Development (CDBG) - 4,776,100 4,776,100
Urban Area Security Initiative Grant - 537,910 537,910
Social Services Agency Grant - - -
Housing (Section 8) - 71,279,220 71,279,220
Workforce Investment Act - 2,298,100 2,298,100
Measure M, Street Grants - 14,628,320 14,628,320
Civic Center and Park - 3,776,860 3,776,860
Program Income - 1,082,670 1,082,670
Other Federal Grants - 5,226,380 5,226,380
Total Other Government - 103,605,560 103,605,560
EXHIBIT 2
SCHEDULE TO CATEGORIZE ANTICIPATED REVENUES
FOR FISCAL YEAR ENDING JUNE 30, 2026
EXHIBIT 2
Exhibit 2
Continued
PROCEEDS NON-PROCEEDS
REVENUE OF TAXES OF TAXES TOTALS
LOCALLY RAISED:
Licenses and Permits - 6,147,280 6,147,280
Franchise Fees - 13,600,000 13,600,000
Fines and Forfeitures - 5,599,300 5,599,300
Charges for Services - 32,098,540 32,098,540
From Use of Property - 12,527,640 12,527,640
Others - 210,000 210,000
Others - Inter-Agency - 1,678,600 1,678,600
Total Locally Raised - 71,861,360 71,861,360
OTHER MISCELLANEOUS:
Donation - 219,050 219,050
Expense Reimbursements - 2,041,900 2,041,900
Indirect Cost Recovery - 11,375,920 11,375,920
Interfund Transfers - 22,405,380 22,405,380
Opioid Settlements - 1,403,450 1,403,450
Total Other Miscellaneous - 37,445,700 37,445,700
FROM USE OF MONEY:
Earnings on Investment 2,010,320 1,524,620 3,534,940
TOTAL REVENUES $329,654,760 $235,219,940 $564,874,700
Proceeds of taxes 329,654,760$
Less: Exclusions (8,403,412)
Appropriation subject to limitation 321,251,348$
Current year limit 1,522,518,198
Over(under) limit (1,201,266,850)$
EXHIBIT 3
APPROPRIATION SUBJECT TO LIMITATION
FOR FISCAL YEAR ENDING JUNE 30, 2026
EXHIBIT 3
Resolution No. 2025-XXX
Page 1 of 3
RESOLUTION NO. 2025-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA ESTABLISHING THE APPROPRIATION LIMIT
OF THE CITY OF SANTA ANA FOR FISCAL YEAR
2025-2026
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS
FOLLOWS:
Section 1. The City Council of the City of Santa Ana hereby finds, determines
and declares as follows:
A.Article XIIIB of the Constitution of the State of California, adopted by the
voters of the State of California in 1979, imposes upon State and local
government the obligation to limit each fiscal year’s appropriations to those
established in fiscal year 1978-79 as adjusted for by inflation and
population, together with other specified changes required or permitted.
B.In June of 1990, the voters of the State of California approved Proposition
111, which amended Article XIIIB to establish the limit originally calculated
for fiscal year 1986-87 as a new adjustment base, and to change the
definition of the cost of living to be either the percentage change in
California per capita personal income from the preceding year or the
percentage change in the local assessment roll from the preceding year for
the jurisdiction due to the addition of local non-residential new construction.
C.Proposition 111 further modified Article XIIIB requirements by making
certain capital outlay, debt service, emergency and court ordered
expenditures not subject to the limit, and by allowing expenditures in excess
of one year's limit to be offset by under expenditures in an immediately
following year.
D.The City of Santa Ana has opted to use as the inflation adjustment factor
the percentage change in the California per capita personal income f rom
the preceding year.
E.The City of Santa Ana has opted to use as the population adjustment factor
the County’s percentage change in population from the preceding year.
F.Section 7910 of the Government Code of the State of California requires
the governing body of each local jurisdiction each year to, by resolution,
establish its appropriations limit and make other necessary determinations
for the following fiscal year pursuant to Article XIIIB of the California
EXHIBIT 4
Resolution No. 2025-XXX
Page 2 of 3
Constitution at a regularly scheduled meeting or noticed special meeting.
Fifteen days prior to the meeting, documentation used in the determination
of the appropriations limit and other necessary determinations shall be
available to the public.
G. This matter came before the City Council at its regularly scheduled meeting
of June 17, 2025.
H. The Executive Director of the Finance and Management Services Agency
of the City of Santa Ana has determined the City’s appropriation limit for
fiscal year 2025-2026 in accordance with said provisions of the Constitution
and laws of the State of California, and the documentation used in the
determination has been available to the public since not later than June 2,
2025, in the office of the Executive Director of the Finance and Management
Services Agency.
Section 2. Based upon the above referenced facts, and all facts specified in the
accompanying Request for Council Action and its attachments, and each of them, the
appropriation limit of the City of Santa Ana for fiscal year 2025-2026 is hereby found and
determined to be $1,522,518,198.
Section 3. This Resolution shall take effect immediately upon its adoption by
the City Council, and the City Clerk shall attest to and certify the vote adopting this
Resolution.
ADOPTED this _____ day of ______________, 2025.
_______________________
Valerie Amezcua
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho
City Attorney
By:________________________
Andrea Garcia-Miller
Assistant City Attorney
Resolution No. 2025-XXX
Page 3 of 3
AYES: Councilmembers ___________________________________
NOES: Councilmembers ___________________________________
ABSTAIN: Councilmembers ___________________________________
NOT PRESENT: Councilmembers ___________________________________
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, Jennifer Hall, City Clerk, do hereby attest to and certify the attached Resolution
No. 2025-______ to be the original resolution adopted by the City Council of the City of
Santa Ana on June 17, 2025.
Date: ____________ ___________________________
City Clerk
City of Santa Ana