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Home My WebLink About55A - RESO - APPROPRIATION LIMIT FY 14-15REQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: JULY 1, 2014 TITLE: RESOLUTION ESTABLISHING THE APPROPRIATION LIMIT OF THE CITY OF SANTA ANA FOR FY 2014 -15 CITY MFi AGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on I" Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Adopt a resolution establishing the appropriation limit for the fiscal year 2014 -15. DISCUSSION The State of California Constitution includes provisions, which impose a limit ( "the GANN Limit") on tax proceeds that may 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 these provisions for the fiscal year ending June 30, 2015. As detailed in the exhibits to the subject resolution, the City's spending limitations from "Proceeds of Taxes" is calculated to be $893,083,329 (Exhibit A) for FY 2014 -15. This represents the permitted growth rate factor of 26.5479 times the adjusted base year (1978 -1979) appropriation limit of $33,640,451. Exhibit B identifies the factors used to determine the allowable increase; Exhibit C categorizes FY 2014 -15 anticipated revenues from "Proceeds of Taxes" and "Non - Proceeds of Taxes "; and Exhibit D computes the fiscal year 2014 -2015 appropriations subject to this limitation and identifies the difference between the limit and the budgeted appropriation. As demonstrated in Exhibit D, the City's anticipated FY 2014 -15 "Proceeds of Taxes" revenue will be $751,138,627 below the allowable limit. FISCAL IMPACT There is no fiscal impact associated with this action. Francisco Gutierrez Executive Director Finance and Management Services Agency Exhibits: A. Computation of Appropriation Limit B. Calculation of Permitted Growth Rate C. Schedule to Categorize Anticipate Revenues D. Appropriation Subject to Limitation Resolution 55A -1 55A -2 EXHIBIT A COMPUTATION OF APPROPRIATION LIMIT FOR FISCAL YEAR ENDING JUNE 30, 2015 Appropriation Limit: 1978 -79 Base Year Permitted Growth Rate in appropriation (Exhibit B) Appropriation Limit for the Fiscal Year Ending June 30, 2015 55A -3 33,640,451 26.5479 $ 893,083,329 EXHIBIT B CALCULATION OF PERMITTED GROWTH RATE IN APPROPRIATIONS FOR FISCAL YEAR ENDING JUNE 30. 2015 Factor 2014 -15: California Per Capita Personal Income: - 0.230% Converted into a Factor 0.9977 Population Growth: 0.93% Converted into a Factor: 1.0093 Rates of Change: 0.9977 x 1.0093 1.0070 Multiplied by 2013 -14 Combined Index 26.3634 Combined Index 1979 -80 through 2014 -2015 26.5479 55A -4 REVENUE TAXES: Property Tax Sales Tax Hotel Visitors' Tax Business Tax Documentary Stamp Tax Utility Users' Tax Total Taxes FROM STATE: State Gas Tax State Cost Reimbs State Grants AQMD AB 2766 Total State EXHIBIT C SCHEDULE TO CATEGORIZE ANTICIPATED REVENUES FOR FISCAL YEAR ENDING JUNE 30, 2015 PROCEEDS OF TAXES 62,359,000 45,460,000 8,200,000 11,300,000 680,000 24,001,000 152,000,000 NON- PROCEEDS OF TAXES - 10,467,025 - 211,000 - 865,450 - 414,000 TOTALS 62,359,000 45,460,000 8,200,000 11,300,000 680,000 24,001,000 152,000,000 10,467,025 211,000 865,450 414,000 11,957,475 11,957,475 OTHER GOVERNMENT: Community Development (CDBG) 6,380,500 6,380,500 Homeowner Prop Tax Subvention 230,000 - 230,000 SSA Grant - 800,000 800,000 Housing (Section 8) - 30,300,015 30,300,015 WIA - 3,441,605 3,441,605 Measure M, Street Grants, Gas Tax Exch - 35,075,247 35,075,247 Civic Center and Park - 2,879,274 2,879,274 Program Income - 500,000 500,000 Other Federal Grants: HOME,HOPWA - 5,211,525 5,211,525 Total Other Government 230,000 84,588,166 84,818,166 LOCALLY RAISED: Licenses and Permits - 3,632,000 3,632,000 Franchise Fees - 7,994,150 7,994,150 Fines and Forfeitures - 7,164,000 7,164,000 Charges for Services - 9,367,000 9,367,000 Parks and Recreations - 1,275,740 1,275,740 From Use of Property - 16,999,884 16,999,884 Others - 86,000 86,000 Others - Inter - Agency - 6,926,000 6,926,000 Total Locally Raised - 53,444,774 53,444,774 OTHER MISCELLANEOUS: Donation - 125,000 125,000 Sale of Junk and Property - 5,000 5,000 Attorney Reimbursements - 979,000 979,000 Expense Reimbursements - 2,362,910 2,362,910 Indirect Cost Recovery - 2,093,000 2,093,000 From Prior Year Fund Balances - 10,054,780 10,054,780 Refuse Program Saving - 1,352,000 1,352,000 Interfund Transfers - 6,707,776 6,707,776 Total Other Miscellaneous - 23,679,466 23,679,466 FROM USE OF MONEY: Earnings on Investment 1,444,494 1,906,222 3,350,716 TOTAL REVENUES $ 153,674,494 $ 175,576,103 $ 329,250,597 55A -5 EXHIBIT D APPROPRIATION SUBJECT TO LIMITATION FOR FISCAL YEAR ENDING JUNE 30, 2015 Proceeds from taxes Less: Exclusions Appropriation subject to limitation Current year limit Over(under) limit 'P�PM $ 153,674,494 11, 729, 792 $ 141,944,702 893,083,329 $ (751,138,627) ROH: 06/02/14 RESOLUTION NO. 2014- 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 2014 -2015 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 November 1987, 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 XIII B 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 XIII B 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 from 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. 55A -7 Resolution No. 2014- F. Division 9 of Title I of the Government Code of the State of California (commencing with section 7900), as enacted by 1980 Statutes, Chapter 1205, effective January 1, 1981, directs 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 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 July 1, 2014. H. The Executive Director, Finance and Management Services Agency of the City of Santa Ana, has determined the City's appropriation limit for fiscal year 2014 -2015 in accordance with said provisions of the Constitution and laws of the State of California and the documentation used in said determination has been available to the public since not later than June 16, 2014, in the office of the Executive Director, Finance & 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 2014 -2015 is hereby found and determined to be $893,083,329. Section 3. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. Resolution No. 2014- - 55A -8 ADOPTED this day of APPROVED AS TO FORM: Sonia R. Carvalho City Attorney By: Ryan 0. Hodge Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers 2014. Miguel A. Pulido Mayor CERTIFICATE OF ATTESTATION AND ORIGINALITY I, Maria D. Huizar, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2014- to be the original resolution adopted by the City Council of the City of Santa Ana on July , 2014. Date: Clerk of the Council City of Santa Ana 55A -9 Resolution No. 2014 - 55A -10