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  Agenda Item   18.    
City Council Meeting
Meeting Date: 10/20/2020  
FROM: Bill Gallardo

Subject:
Budget Adjustments to the City Operating and Capital Improvement Program Budgets for Fiscal Year 2019-20
RECOMMENDATION
Adopt the attached resolutions appropriating funds to adjust the Fiscal Year 2019-20 City Operating and Capital Improvement Program Budgets.
BACKGROUND/DISCUSSION
Budget adjustments are presented to the City Council periodically for review. These adjustments represent the appropriation of items previously approved by the City Council during the fiscal year, or staff recommended adjustments for City Council consideration. The recommended adjustments to the City Operating Budget are listed in City - Exhibit A. These adjustments are separated by funding source and the accounts are identified as either revenue or expenditure accounts.

The Police Services Department is requesting the write-off of $158,346 for past due DUI and Booking Fee invoices.  These invoices have since then been sent to collections.  Fortunately, the Police Department realized enough departmental saving to cover this expense, but are nonetheless requesting permission to apply this expense to their operating budget.

The Fire Department continues to respond to mutual aid throughout California.   Fire Administration continues to be diligent in seeking reimbursement for cost incurred.  Mutual aid responses included: the Office of Emergency Serves (OES) Preposition (Wildland/Wind) in Orange County, the Kincade Fire in Napa and Somona County, the Saddleridge and Tick Fires in Los Angeles County, and the Cave Fire in the Los Padres National Forest.  These strike team responses resulted in the Fire Department's overtime budget and other operating costs to increase by $309,261.  This increased cost is fully offset by reimbursements.

In addition, the Fire Department is requesting a budget adjustment of $170,000 to cover the cost of additional overtime beyond what was budgeted.   This additional overtime was needed to cover shifts primarily due to personnel attrition, retirements, sick, vacation, disability, as well as other time-off taken by personnel.

Also included in these adjustments is a revision to the annual General Fund Transfer to the Paramedic Fund (174) and the Sanitation and Street Sweeping Fund (440).   The General Fund supplements the Paramedic Fund for costs that exceed the Paramedic Tax Revenues.  Overall expenditures were higher than budgeted due primarily to salary, benefits, and overtime cost incurred due to a disability claim as well as shift coverage for paid time off for personnel.  The proposed adjustment for this transfer is $55,728.   For the Sanitation and Street Sweeping Fund (440), an annual transfer is made from the General Fund (110) in lieu of franchise fees collected on trash collection.   This amount varies from year-to-year and is used to balance revenue collected that is less than expenditures incurred.  Franchise fees collected for trash for FY 2019-20 were $961,175.    The proposed adjustment is $94,969.

In addition, at the February 4, 2020 Meeting, City Council approved the use of Fire Impact Fees (Fund 542) to purchase miscellaneous equipment.  Such equipment included: a rescue ATV Pickup Truck, an exhaust removal system, tri-band Motorola radios, a UAV drone, AEDs with EKG capabilities; and SCBA voice amplifiers.   Total cost of this equipment is $340,000.

The COVID-19 pandemic has affected all worldwide.   From March to June 2020, the City of Brea has spent $243,404 in COVID related expense.   This expense includes overtime, personal protective equipment, and additional cleaning of City facilities and vehicles.  Fortunately, the City entered into a sub-recipient agreement with the County of Orange to receive Coronavirus Relief Fund dollars for eligible expenses incurred.  The amount received through June 30, 2020 was $352,859.  This grant amount represents the amount allocated to the City based on 2010 population figures.  The excess money received will be applied to expenditures incurred in FY 2020-21.

For Capital Improvement Projects, $250,000 in funding from the Park Development Fund (250)has been transferred from the Dog Park Surface Improvement Project (#7950) to the Park Irrigation Design & Replacement (#7957).  In doing so, this reduces funding needed from the Fixed Asset Replacement Program (182) Fund.  In addition, staff is requesting $115,267 in Water Utility (420) Fund be transferred from the Cliffwood Tract Water Improvements Project (#7461) to Cliffwood Industrial Park Pavement Rehabilitation Project (#7317).  Lastly, staff wishes to eliminate $400,000 in funding from the Measure M Fund (260) for the Randolph Rehabilitation Project (#7288).  This project has been put on hold and staff would like to free up Measure M monies for other projects.

The Capital Improvement Program Budget adjustments in CIP - Exhibit A consists of a decrease in expenditures of $351,607 and a corresponding adjustments to revenues and transfers-in as follows:

 
Fixed Asset Replacement Fund (182)      $   (206,914)
Gas Tax Fund (220) 5,307
Park Development Fund (250) 250,000
Measure M Fund (260) (400,000)
TOTAL $   (351,607)
COMMISSION/COMMITTEE RECOMMENDATION
The attached FY 2019-20 budget adjustments were reviewed by the Finance Committee on October 13, 2020, and recommended for City Council approval.
 
FISCAL IMPACT/SUMMARY
The City Operating Budget adjustments for the General Fund (110) in Exhibit A resulted in an increase in revenues of $359,627 and an increase in expenditures and transfers-out of $937,118, for a net General Fund increase in over expenditures and transfers-out of $577,491. The City Operating Budget adjustments for all funds including the General Fund resulted in an increase in revenues and transfers-in of $982,491 and an increase in expenditures and transfers-out of $1,202,760 for a net increase in expenditures and transfers-out of $220,269.  The Capital Improvement Program Budget adjustments resulted in an decrease in expenditures of $351,607 and a corresponding adjustments to revenues and transfers-in.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager
Prepared by:  Faith Madrazo, Revenue & Budget Manager
Concurrence:  Cindy Russell, Administrative Services Director
 
Attachments
Resolution - City
Resolution - CIP

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