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AGENDA
SPECIAL MEETING
SARATOGA CITY COUNCIL
APRIL 13, 2015
SPECIAL MEETING – 6:00 P.M. ADMINISTRATIVE CONFERENCE ROOM, 13777
FRUITVALE AVENUE
ORAL COMMUNICATIONS ON NON-AGENDIZED ITEMS
Any member of the public will be allowed to address the City Council for up to three (3) minutes
on matters not on this agenda. The law generally prohibits the council from discussing or taking
action on such items. However, the Council may instruct staff accordingly regarding Oral
Communications under Council Direction to Staff.
STUDY SESSION – 6:00 P.M.
1. Fiscal Year 2015/16 Budget Study Session
Recommended Action:
Council to review and provide consensus direction to staff on:
1) Draft FY 2015/16 Proposed Operating Budget
2) Revised FY 2015/16 Capital Project Funding Allocations
3) Updated Fiscal Policies
ADJOURNMENT
In accordance with the Ralph M. Brown Act, copies of the staff reports and other materials provided to the
City Council by City staff in connection with this agenda are available at the office of the City Clerk at
13777 Fruitvale Avenue, Saratoga, CA 95070. Note that copies of materials distributed to the City Council
concurrently with the posting of the agenda are also available on the City Website at www.saratoga.ca.us.
Any materials distributed by staff after the posting of the agenda are made available for public review at
the office of the City Clerk at the time they are distributed to the City Council.
In Compliance with the Americans with Disabilities Act, if you need assistance to participate in this
meeting, please contact the City Clerk at 408/868-1269. Notification 24 hours prior to the meeting will
enable the City to make reasonable arrangements to ensure accessibility to this meeting. [28 CFR 35.102-
35.104 ADA title II]
Certificate of Posting of Agenda:
I, Crystal Bothelio, City Clerk for the City of Saratoga, declare that the foregoing agenda for the meeting
of the City Council was posted and available for public review on April 9, 2015 at the City of Saratoga,
13777 Fruitvale Ave., Saratoga, CA 95070 and on the City’s website at www.saratoga.ca.us.
Signed this 9th day of April 2015 at Saratoga, California.
Crystal Bothelio, City Clerk
Crystal Bothelio, City Clerk
SARATOGA CITY COUNCIL
MEETING DATE: April 13, 2015
DEPARTMENT: Finance & Administrative Services Department
PREPARED BY: Mary Furey, Administrative Services Director
SUBJECT: Review the draft FY 2015/16 proposed operating budget, proposed capital improvement
project funding, and updated fiscal policies.
RECOMMENDED ACTION:
Council to review and provide consensus direction to staff on:
1) Draft FY 2015/16 Proposed Operating Budget
2) Revised FY 2015/16 Capital Project Funding Allocations
3) Updated Fiscal Policies
BACKGROUND:
This annual Budget Study Session is intended to provide an update of the current year’s funding and expenditure
estimates, a summary overview of next fiscal year’s proposed operating budget and notable changes, and a final
review of recommended capital project funding allocations. Council direction will be incorporated into the
proposed Operating and Capital Budgets to be brought to Council in May. Additionally, as fiscal policies are
included as part of the annual budget adoption, proposed policy additions and/or revisions are brought to Council
for discussion.
This informal review process provides Council with the opportunity to ask questions, request clarifications, and
provide direction in preparation of the May 20th proposed budget public hearing.
General Fund Summary Overview
The General Fund Summary overview of Total Operating Sources will include a general discussion on proposed
revenue trends, and more specific information on the use of fund balance reserves. This will include identifying
the current year’s loan from the Fiscal Stabilization Reserve, the proposed repayment in the current year, and the
plan to finish paying off the loan in the proposed and following year.
The Total Operating Uses overview will highlight notable changes in the current and proposed year’s expenditures,
specific discussion on the significant Sheriff Contract increases, Community Services funding, and a proposed UAL
future payment plan.
Total Fund Activity Overview
The Total Fund Activity review will provide a high level walkthrough of the General, Internal Services, GO Debt,
and Capital Funds from the estimated beginning fund balance through total budgeted revenue and expenditure
amounts, to the estimated ending fund balance. We will highlight the General Fund Reserves, some notable changes
in the Internal Service Funds, and provide a high level Debt Service and Capital Budget Funds overview.
Capital Project Funding
Proposed capital projects and funding were discussed during the Mid-Year retreat, and Council provided direction
on approved projects and proposed funding allocations. Subsequent to that meeting, staff received notice that the
State’s Gas Tax allocations would be reduced by approximately $250,000 next fiscal year as a result of a prior year
funding correction and overall reductions in gas tax revenues. In addition, it was determined that the Via Regina
Trail project was not buildable at this point in time, and that an additional $90,000 of project funding was requested
for an upgraded flushable restroom facility at Quarry Park.
The Finance Committee reviewed these changes and have provided recommendations for funding allocation
decreases in the EV station project and the Village Creek Trail construction grant match project, and elimination of
the Via Regina Trail funding to provide additional funding for the Street Resurfacing and Quarry Park Restroom
projects. Furthermore, under a planned increase in the Solid Waste agreement’s Vehicle Impact Fee (VIF)
assessments, an additional $144,000+ will flow into the Street Resurfacing Project in FY 2015/16, and $288,000+
in the years thereafter. This additional VIF revenue and other project funding shifts would offset the Gas Tax
shortfall to approximately $36,000 in FY 2015/16, and bring in excess of $1 million total revenues in the following
years. Staff recommends a General Fund transfer to make up the Street Resurfacing project funding shortfall in FY
2015/16.
The attached CIP worksheet summarizes Council’s original recommendations and the Finance Committee’s
recommended funding shifts (highlighted in yellow) for review and discussion. The Unfunded Project List is also
included as an attachment with the re-addition of the Via Regina Trail project.
On Thursday afternoon, during final preparation of the Budget Study Session meeting documents, I found I’d made
an error in the CIP Reserve Availability calculation. The available amount is overstated by $117,900, meaning
there is not enough CIP Reserve funding for the proposed project allocations.
In a normal process, staff would bring this matter to the Finance Committee for a revised allocation
recommendation, however given the timing of the determination, we have identified three options for Council to
consider at the Budget Study Session:
1. Refer matter to Finance Committee and bring recommended allocations to Proposed Budget Hearing on
May 20th.
2. Leave proposed FY 2015/16 CIP project funding as recommended, and utilize FY 2014/15 Net Operations
to fully fund proposed project allocations.
3. Council to discuss and identify reductions to proposed FY 2015/16 CIP project allocations
Fiscal Policies
Updates to Fiscal Policies are incorporated into the budget adoption process. Fiscal policy updates include policy
language refinements and clarifications, expanded policy direction, documentation of existing best practices or
verbal policy direction, necessary operational or fiscal changes to reflect current practices or legal requirements,
and additional policies as requested.
As part of the Finance Committee’s function, fiscal policies are reviewed, updated, and new policies developed to
reflect refined policy direction and changes. Proposed policy updates are brought to Council at the Mid-Year retreat
and/or Budget Study Session for discussion prior to the proposed budget hearing in May. This year’s fiscal policy
update is primarily cleanup – a new Facility Furniture, Fixtures & Equipment (FFE) Replacement Fund policy was
added to incorporate the new Internal Service Fund into the ISF Reserve Policies. The proposed policy is as follows:
Facility Furniture, Fixtures & Equipment (FFE) Replacement Fund
The Facility FF&E Fund accumulates funding over an asset’s lifespan to be used for the replacement
of furniture – such as tables, chairs, and cubicle partitions; for fixtures - such as kitchen appliances,
sound equipment, lighting, for equipment - such as HVAC units, boilers, and generators; and for facility
infrastructure – such as roof, door, window, and floor/carpeting replacement.
Initial purchases for new assets may be paid for through the Operating Budget or through the Capital
Budget. Annual replacement charges are charged-back to the supported department programs with full
replacement funding to be accumulated over the asset’s estimated lifetime. Final determination for
replacement of the asset is determined through an analysis of whether the cost of maintenance equals
or exceeds the cost of replacing the asset. The reserve is intended to be maintained at a level sufficient
to provide replacement funding in accordance with replacement schedules.
Requests for use of the accumulated reserve funding are approved by Council through budget adoption,
or if an unplanned situation occurs, by a Council approved budget adjustment resolution during the
fiscal year. The reserve is replenished by replacement funding allocations in subsequent years.
The remainder of the policy update changes are language clarification and clean-up.
The Finance Committee is requesting that Council as a whole review the Facility Replacement Reserve (page 15)
so that a refined purpose can be incorporated into the reserve policy. The Facility Replacement Reserve policy was
developed a couple of years ago as part of an in-depth Reserve Policy review. It was intentionally left vague and
general with the intent that Council would refine the policy at a later date. The policy as it reads currently is:
Facility Replacement Reserve
The Facility Replacement Reserve is established to accrue funding for the major rehabilitation or
replacement of City Buildings. Eligible uses of this reserve to finance the construction of critical City
facilities include direct funding of public facility improvements, and the servicing of related debt.
An initial contribution of $300,000 was established in FY 2012/13 with Council’s recommendation to
continue funding at this level as available. Annual contributions, reserve goal amount, and utilization
shall be determined by Council as the City’s economic situation changes.
Current policy direction for funding the Facility Replacement Reserve is prioritized by the following Year-End
Allocation Policy (page 14), placing it #4 in line, before Capital Improvement Project Reserve funding:
General Fund Year-End Allocations
After the City’s financial records are finalized and audited, with legal obligations and
liability reserves funded, revenues in excess of expenditures are closed out to the Other
Unassigned Fund Balance Reserve. Funding in excess of the $500,000 that is to remain in
the Other Unassigned Fund Balance Reserve will be distributed in the following order:
1. Working Capital Reserve interest allocation.
2. Repayment of Fund Balance Reserve loans - back to established levels (e.g. borrowing
from the Fiscal Stabilization or Hillside Stability Reserves).
3. Annual contribution of $100,000 to Hillside Stability Reserve, until reserve balance
reaches $1,000,000.
4. Annual contribution of $300,000 to Facilities Replacement Reserve.
5. Remaining funds are allocated to the Future Capital Improvement & Cost Efficiency
Projects Reserve.
Staff would like affirmation or additional direction on funding the reserve at the $300,000 funding level as number
4 in line, before funding is set aside for Capital Projects – in light of the anticipated reduction in Net Operations
over the fore-coming years due to the proposed annual $500,000 payment for the UAL payoff plan.
Please Note: The Proposed Operating & Capital Budget is currently being finalized for the Budget Hearing on
May 20, 2015. Documents and fiscal information provided at this budget study session are still in development and
subject to revisions and updates.
CONSEQUENCES OF NOT FOLLOWING RECOMMENDED ACTION:
Council would not benefit from the review of the proposed operating budget, capital projects, and fiscal policies in
a study session environment, or provide input and direction to staff.
ATTACHMENTS:
General Fund Summary Overview:
Attachment 1 – FY 2015/16 FTE Schedule
Attachment 2 - Draft FY 2015/16 General Fund Summary worksheet
Attachment 3 - Summary of Sheriff Wage Increases
Attachment 4 – Proposed Fiscal Stabilization Reserve loan repayment plan
Attachment 5 – Proposed UAL payoff plan
Attachment 6 - Community Services funding worksheet
Total Fund Activity Overview:
Attachment 7 - Draft FY 2015/16 Total Fund Activity Summary worksheet
CIP Funding:
Attachment 8 - Finance Committee Recommended Revisions to Capital Projects Funding Worksheet
Attachment 9 - Proposed Unfunded Capital Projects Worksheet
Fiscal Policies:
Attachment 10 – Draft updated FY 2015/16 Fiscal Policies (in track changes mode)
2011/12 2012/13 2013/14 2014/15 2015/16
Full Time Equivalents (FTE)Funded Funded Funded Funded Funded
City Manager's Department
City Manager 1.00 1.00 1.00 1.00 1.00
Exec Assistant to CM / Deputy City Clerk 0.90 1.00 1.00 1.00 1.00
City Clerk 1.00 1.00 1.00 1.00 1.00
Administrative Analyst I/II 1.00 1.00 1.00 1.00 1.00
TOTAL FTE's 3.90 4.00 4.00 4.00 4.00
Administrative Services Department
Administrative Services Director 1.00 1.00 1.00 1.00 1.00
Finance Manager - - 1.00 1.00 1.00
Accountant I/II 0.90 0.90 0.90 0.90 0.90
Accounting Technicians 3.00 3.00 3.00 3.00 3.00
Human Resources Manager 1.00 1.00 1.00 1.00 1.00
Human Resources Technician - - 0.75 0.75 0.75
Information Technology Administrator 1.00 1.00 1.00 1.00 1.00
Information Technology Technician - - 1.00 1.00 1.00
TOTAL FTE's 6.90 6.90 9.65 9.65 9.65
Community Development Department
Community Development Director 1.00 1.00 1.00 1.00 1.00
Senior Planner 1.00 1.00 1.00 1.00 1.00
Planner I/II 2.00 2.00 2.00 2.00 2.00
Plan Check Engineer 1.00 1.00 1.00 1.00 1.00
Senior Arborist 1.00 1.00 1.00 1.00 1.00
Building Official 1.00 1.00 - - -
Sr. Building Inspector/Plan Checker - - 1.00 1.00 1.00
Building Inspector 2.00 2.00 2.00 2.00 2.00
Permit Technician - - 1.00 1.00 1.00
Office Specialist III 2.00 2.00 2.00 2.00 2.00
Code Compliance Specialist 1.00 - - - -
TOTAL FTE's 12.00 11.00 12.00 12.00 12.00
Public Works Department
Public Works Director 1.00 1.00 1.00 1.00 1.00
Senior Civil Engineer 1.00 1.00 1.00 1.00 1.00
Assistant/Associate Engineer 1.00 1.00 1.00 1.00 1.00
Administrative Analyst I/II 0.90 0.90 1.00 0.90 0.90
Office Specialist II/III 1.75 1.75 1.75 1.75 1.75
Parks Maintenance Manager 1.00 1.00 1.00 1.00 1.00
Parks Maintenance Lead 1.00 1.00 1.00 1.00 2.00
Parks Maintenance Specialist 1.00 - - - -
Parks Maintenance Worker I/II/III 5.90 6.00 6.00 6.00 5.00
Street Maintenance Manager 1.00 1.00 1.00 1.00 1.00
Street Maintenance Lead 1.00 1.00 2.00 2.00 2.00
Street Maintenance Specialist 1.00 1.00 - - -
Street Maintenance Worker I/II/III 4.00 4.00 4.00 4.00 4.00
TOTAL FTE's 21.55 20.65 20.75 20.65 20.65
TOTAL STAFF BY DEPARTMENT
SARATOGA
Z:\Budget Directory\Operating Budget\FY 2015-16\Financial Summaries\Personnel Summaries\FY2015-16 FTEs
Schedules 4/9/2015
2011/12 2012/13 2013/14 2014/15 2015/16
Funded Funded Funded Funded Funded
Recreation & Facilities Department
Recreation & Facilities Director 1.00 1.00 1.00 1.00 1.00
Senior Recreation Supervisor 1.00 - - - -
Recreation Supervisor 1.00 1.00 1.00 1.00 0.90
Recreation Coordinator - 2.00 2.00 2.00 1.85
Facility Coordinator 0.60 0.60 0.60 0.60 0.60
Office Specialist II/III 1.90 1.00 1.00 1.00 1.00
Facility Maintenance Manager 1.00 1.00 1.00 1.00 1.00
Facility Maintenance Lead 1.00 1.00 1.00 1.00 1.00
Facility Maintenance Worker I/II/III 2.00 2.00 2.00 2.00 1.00
TOTAL FTE's 9.50 9.60 9.60 9.60 8.35
TOTAL STAFF FTEs 53.85 52.15 56.00 55.90 54.65
2011/12 2012/13 2013/14 2014/15 2015/16
Funded Funded Funded Funded Funded
City Manager's Department
Student Intern - - 320 320 -
Executive Assistant (backfill)- - 120 136 750
Temporary Pool Hours - - 940 - -
Administrative Services Department
Senior Accountant 1,200 1,200 200 - -
IT Technician 2,000 2,000 - - -
HR Technician 1,768 1,568 - - -
Student Interns - - 320 320 -
Graphic Design Assistant - - - - 149
Community Development Department
Office Specialist III 800 800 800 800 940
Student Intern 940 940 - 320 480
Public Works Department
Engineering Inspectors 2,760 2,760 2,760 2,760 2,760
Maintenance Worker 2,000 - - - 999
Recreation & Facilities Department
Facility Attendents 1,500 1,500 1,500 1,750 1,900
Recreation Leaders 500 500 3,335 3,300 2,178
Graphic Design Assistant - - - - 850
Student Intern 480
TOTAL ANNUAL HOURS 13,468 11,268 10,295 9,706 11,486
Temporary Hours converted to FTEs 6.48 5.42 4.95 4.67 5.52
TOTAL FTE's 60.33 57.57 60.95 60.57 60.17
FUNDED HOURLY STAFFING BY DEPARTMENT
Z:\Budget Directory\Operating Budget\FY 2015-16\Financial Summaries\Personnel Summaries\FY2015-16 FTEs
Schedules 4/9/2015
FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2014/15 FY 2015/16 % of
General Fund Revenues Actuals Actuals Actuals Adjusted Estimated Proposed Budget
Property Tax 8,279,947$ 8,966,396$ 9,526,189$ 10,223,750$ 10,414,901$ 10,475,350$ 54.3%
Sales Tax 1,100,489 1,051,121 941,350 1,085,000 1,100,000 1,060,000 5.5%
Transient Occupancy Tax 205,421 228,199 257,010 245,000 294,000 310,000 1.6%
Business & Other Taxes 477,963 541,158 565,261 540,000 564,000 575,000 3.0%
Franchise Fee Tax 1,852,390 2,083,704 2,112,596 2,105,954 2,167,851 2,183,954 11.3%
Intergovernmental 274,848 416,486 466,424 433,500 497,559 446,500 2.3%
Fees, Licenses & Permits 1,236,460 1,591,517 1,524,041 1,466,450 1,482,468 1,565,900 8.1%
Charge for Services 1,732,889 1,744,112 1,942,388 1,887,153 1,789,009 1,847,058 9.6%
Interest 44,731 28,670 40,003 25,000 41,000 43,000 0.2%
Rental Income 508,647 465,460 440,287 463,508 477,170 483,602 2.5%
Other Sources 516,848 519,164 452,817 296,902 315,927 286,525 1.5%
Total General Fund Revenues 16,230,633$ 17,635,987$ 18,268,366$ 18,772,217$ 19,143,885$ 19,276,889$ 100%
Fund Transfers In 205,222 106,000 167,050 - - -
Total Revenues & Transfers 16,435,855$ 17,741,987$ 18,435,416$ 18,772,217$ 19,143,885$ 19,276,889$
Use of (Addition to) Fund Balance Reserves
Carryforward Reserve 31,900 247,200 73,101 118,788 118,788 -
Development Reserve - - - - - 60,000
Environmental Pgm Reserve - 50,000 50,000 50,000 50,000 50,000
CIP Reserve 80,779 1,504,944 280,880 1,633,345 1,633,345 1,695,796
CY CIP Reserve - - - 500,000 500,000 -
Hillside Reserve - (75,000) (216,721) - - -
Compensated Absences - (200,000) - - - -
Fiscal Stabilization Loan - - - 1,000,000 1,000,000 -
Fiscal Stabilization Repayment (500,000) (250,000)
Working Capital Reserve - - - 930,184 930,184 -
Total Operating Sources 16,548,534 19,269,131 18,622,676 23,004,534 22,876,202 20,832,685
FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2014/15 FY 2015/16 % of
General Fund Expenditures Actuals Actuals Actuals Adjusted Estimated Proposed Budget
Salary & Benefits 6,074,360$ 6,409,105$ 6,408,421$ 6,937,142$ 6,433,464$ 6,983,330 37.8%
UAL Payment - - - 3,380,000 3,294,619 500,000 2.7%
Materials & Supplies 163,990 188,965 236,925 301,011 252,070 282,420 1.5%
Fees & Charges 708,175 738,596 759,799 934,513 892,821 766,809 4.1%
Consultant & Contract Services 1,638,896 1,883,085 2,054,371 2,085,876 2,000,752 2,179,904 11.8%
Sheriff Services 4,060,306 4,153,654 4,225,024 4,600,540 4,723,033 4,985,036 27.0%
Meetings, Events & Training 37,783 38,946 80,468 97,400 80,882 126,800 0.7%
Community Grants & Events 116,203 122,007 169,725 210,576 199,180 215,285 1.2%
Fixed Assets 11,336 - - 35,000 34,680 - 0.0%
Internal Services Charges 1,899,748 2,033,577 2,202,844 2,325,826 2,325,826 2,455,755 13.3%
Total Expenditures 14,710,798$ 15,567,935$ 16,137,576$ 20,907,884$ 20,237,327$ 18,495,339$ 100%
Streets CIP 170,000 195,000 150,000 730,000 730,000 947,796
Park & Trails CIP - 580,000 45,880 443,445 443,445 295,000
Facilities CIP - 224,500 - 339,900 439,900 278,000
Administrative & Technology CIP 10,000 85,000 85,000 120,000 220,000 175,000
CIP Reserve Transfers Out 180,000$ 1,084,500$ 280,880$ 1,633,345$ 1,833,345$ 1,695,796$
Devlpmnt Reserve Transfer Out - - - - - 60,000
GF Operations Transfer Out 100,000$ 100,000$ 100,000$ 200,000$ 200,000$ 100,000$
Total Transfers Out 280,000 1,184,500 380,880 1,833,345 2,033,345 1,855,796
Total Expenditures & Transfers 14,990,798$ 16,752,435$ 16,518,456$ 22,741,229$ 22,270,672$ 20,351,135$
Net Operations 1,557,736 2,516,697$ 2,104,220$ 263,305 605,530$ 481,550$
TOTAL OPERATING USES
TOTAL OPERATING SOURCES
GENERAL FUND SUMMARY
4/9/2015 GF R&E by Category GF rev v exps actuals
Reserve
Balance
7/1/2014 Reserve Balance 1,500,000
FY 2014/15 Reserve Loan (1,000,000)
Current Reserve Balance 500,000
FY 2014/15 Loan Payback 500,000
FY 2015/16 Loan Payback 250,000
FY 2016/17 Loan Payback 250,000
6/30/2017 Reserve Balance 1,500,000
Fiscal Stabilization Reserve Loan
Z:\Budget Directory\Operating Budget\FY 2015-16\Budget Meetings\Study Session - April 13 2015\Staff Report and
Attachments\Fiscal Stabilization Reserve Loan 4/8/2015
CalPERS UAL Payoff Plan
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Future
FY 2015/16 FY 2016/17 FY 2017/18 FY 2018/19 FY 2019/20 FY 2020/21 Years
Original UAL Payment 301,733$ 362,702$ 427,057$ 494,947$ 566,527$ 571,207$ increasing ~ 1%
Less UAL Payoff (240,704)$ (240,704)$ (240,704)$ (240,704)$ (240,704)$ (240,704)$ (240,704)$
61,029$ 121,998$ 186,353$ 254,243$ 325,823$ 330,503$ increasing ~ 1%
OR
Loan Amortization Schedule
Loan amount 4,300,000.00$ Scheduled payment 487,135.12$
Annual interest rate 7.50 %Scheduled number of payments 15
Loan period in years 15 Actual number of payments 15
Number of payments per year 1 Total early payments 180,108.32$
Start date of loan 7/1/2015 Total interest 2,863,990.31$
Optional extra payments 12,864.88$
Pmt.
No.Payment Date Beginning Balance Scheduled
Payment Extra Payment Total Payment Principal Interest Ending Balance Cumulative
Interest
1 7/1/2016 4,300,000.00$ 487,135.12$ 12,864.88$ 500,000.00$ 177,500.00$ 322,500.00$ 4,122,500.00$ 322,500.00$
2 7/1/2017 4,122,500.00$ 487,135.12$ 12,864.88$ 500,000.00$ 190,812.50$ 309,187.50$ 3,931,687.51$ 631,687.50$
3 7/1/2018 3,931,687.51$ 487,135.12$ 12,864.88$ 500,000.00$ 205,123.43$ 294,876.56$ 3,726,564.08$ 926,564.06$
4 7/1/2019 3,726,564.08$ 487,135.12$ 12,864.88$ 500,000.00$ 220,507.69$ 279,492.31$ 3,506,056.39$ 1,206,056.37$
5 7/1/2020 3,506,056.39$ 487,135.12$ 12,864.88$ 500,000.00$ 237,045.77$ 262,954.23$ 3,269,010.62$ 1,469,010.60$
6 7/1/2021 3,269,010.62$ 487,135.12$ 12,864.88$ 500,000.00$ 254,824.20$ 245,175.80$ 3,014,186.42$ 1,714,186.39$
7 7/1/2022 3,014,186.42$ 487,135.12$ 12,864.88$ 500,000.00$ 273,936.01$ 226,063.98$ 2,740,250.40$ 1,940,250.38$
8 7/1/2023 2,740,250.40$ 487,135.12$ 12,864.88$ 500,000.00$ 294,481.22$ 205,518.78$ 2,445,769.19$ 2,145,769.16$
9 7/1/2024 2,445,769.19$ 487,135.12$ 12,864.88$ 500,000.00$ 316,567.31$ 183,432.69$ 2,129,201.88$ 2,329,201.85$
10 7/1/2025 2,129,201.88$ 487,135.12$ 12,864.88$ 500,000.00$ 340,309.85$ 159,690.14$ 1,788,892.03$ 2,488,891.99$
11 7/1/2026 1,788,892.03$ 487,135.12$ 12,864.88$ 500,000.00$ 365,833.09$ 134,166.90$ 1,423,058.93$ 2,623,058.89$
12 7/1/2027 1,423,058.93$ 487,135.12$ 12,864.88$ 500,000.00$ 393,270.58$ 106,729.42$ 1,029,788.36$ 2,729,788.31$
13 7/1/2028 1,029,788.36$ 487,135.12$ 12,864.88$ 500,000.00$ 422,765.87$ 77,234.13$ 607,022.49$ 2,807,022.44$
14 7/1/2029 607,022.49$ 487,135.12$ 12,864.88$ 500,000.00$ 454,473.31$ 45,526.69$ 152,549.18$ 2,852,549.12$
15 7/1/2030 152,549.18$ 487,135.12$ -$ 152,549.18$ 141,107.99$ 11,441.19$ -$ 2,863,990.31$
Net Due
Enter values Loan summary
NON-DEPARTMENTAL Fund 111
Community Grants Program 8301
2011/12 2012/13 2013/14 2014/15 2014/15 2015/16
Actuals Actuals Actuals Adjusted Estimated Proposed
REVENUES - - - - - -
TOTAL REVENUES -$ -$ -$ -$ -$ -$
EXPENDITURES
Operating Expenditures
Community Building and Services Grants
Senior Services
68111 SASCC - Base Program Support 21,000 21,000 21,000 21,000 21,000 21,000
68112 SASCC - Community Services 18,000 18,000 18,000 18,540 18,540 19,096
68113 SASCC - Adult Daycare Support 1,422 20,000 22,000 22,000 22,000 22,000
Community Access Television
68121 KSAR Community Access 26,000 26,650 26,000 35,000 35,000 35,000
Business Community (Chamber of Commerce)
68131 Chamber - Annual Support 12,384 9,567 13,044 13,536 13,536 13,944
68132 Chamber - Annual Membership Fee - 650 650 650
68133 Chamber - City Maps - - 4,800 - - 5,000
68134 Chamber - Triple Panel Advertisement 825 - - 1,200
68134 Chamber - Match Advertisement - - 1,837 2,000 2,000 2,000
Safety Programs
68141 SCC FireSafe Council - Fuel Reduction - - 25,000 25,000 25,000 25,000
Economic Development Programs
68151 Destination Saratoga Marketing - - - 20,000 20,000 -
Special Interest Grants
68231 Shady Shakespeare Theater Co.1,375 - - - - -
68331 SV Wildlife Assoc - Annual 1,425 - - - - -
Support Services Grants
68311 WVCS - Services Support 14,691 3,250 8,000 8,000 8,000 8,000
68312 Children's Health Ins 7,037 - - - - -
68341 United Way - 211 Funding 2,000 2,000 2,000 2,000 2,000 2,000
68351 Catholic Charities Ombudsmen 4,125 3,250 5,000 5,000 5,000 5,000
Total Grants 109,459 103,717 147,506 172,726 172,726 159,890
Total Operating Expenditures 109,459$ 103,717$ 147,506$ 172,726$ 172,726$ 159,890$
TOTAL EXPENDITURES 109,459$ 103,717$ 147,506$ 172,726$ 172,726$ 159,890$
4/7/2015 4:08 PM
Estimated Revenues Expenditures Source (Use)Estimated
Fund Balance && of Fund Balance
Fund Category July 1, 2015 Transfers In Transfers Out Fund Balance June 30, 2016
Operating Funds
General Fund Reserves
Environmental Services 363,182 - - (50,000) 313,182
Hillside Stability 1,000,000 - - - 1,000,000
Capital Projects 1,717,896 - - (1,835,796) (117,900)
Facility Reserve 900,000 - - 300,000 1,200,000
Carryforwards - - - - -
Working Capital 2,005,602 - - 8,000 2,013,602
Fiscal Stabilization 1,000,000 - - 250,000 1,250,000
Development Services 705,459 - - (60,000) 645,459
Compensated Absences 223,846 - - - 223,846
Other Unassigned 792,862 19,276,889 (20,351,135) 1,387,796 1,106,412
Total General Fund Reserves 8,708,847$ 19,276,889$ (20,351,135)$ -$ 7,634,601$
Special Revenue Funds
Landscape & Lighting Districts 843,138 546,411 (611,520) - 778,028
Total Special Revenue Reserves 843,138$ 546,411$ (611,520)$ -$ 778,028$
Internal Service Funds
Liability/Risk Management 388,037 387,500 (464,476) - 311,061
Workers Compensation 314,395 185,000 (239,555) - 259,840
Office Support Services 66,855 62,000 (73,250) - 55,605
IT Services 239,269 475,000 (530,065) - 184,204
Vehicle & Equipment Maintenance 94,825 275,000 (256,346) - 113,479
Building Maintenance 232,836 900,000 (879,629) - 253,207
Vehicle & Equipment Replacement 648,885 125,000 (204,500) - 569,385
IT Equipment Replacement 186,738 125,000 (108,400) - 203,338
Building FFE Replacement - 200,000 (169,000) 31,000
Total Internal Service Fund Reserves 2,171,841$ 2,534,500$ (2,756,221)$ -$ 1,950,120$
Total Operating Funds 11,723,826$ 22,357,800$ (23,718,876)$ -$ 10,362,750$
Debt Service
2001 Series GO Bonds 948,826 826,100 (885,085) - 889,841
Total Debt Service Funds 948,826$ 826,100$ (885,085)$ -$ 889,841$
TOTAL OPERATING BUDGET 12,672,652$ 23,183,900$ (24,603,961)$ -$ 11,252,591$
Capital Funds
Street Projects 2,999,116 8,558,507 (11,334,271) - 223,352
Park & Trail Projects 1,307,261 763,825 (2,031,086) - 40,000
Facility Projects 438,070 313,000 (716,070) - 35,000
Administrative Projects 359,513 315,000 (499,513) - 175,000
Total Capital Funds 5,103,960$ 9,950,332$ (14,580,940)$ -$ 473,352$
TOTAL ALL FUNDS 17,776,612$ 33,134,232$ (39,184,901)$ -$ 11,725,943$
Total Fund Activity Summary
FY 2015/16
Dev Reserve
COUNCIL FC REVISION CORRECTION COUNCIL
2,142,796 2,142,796 2,142,796 2,017,896 705,459
Funding Adjustments:
Add back: Big Basin Way Turnaround - Design 50,000 43,000 43,000 50,000
Add Back: Saratoga Hills Storm Drain Improvements 10,000 10,000 10,000 10,000
Less: Funding redirected for UAL Payment (500,000) (500,000) (500,000) (500,000)
1,702,796 1,695,796 1,695,796 1,577,896 705,459
Street Resurfacing - - 73,796 73,796
Roadway Maintenance and Repairs 375,000 375,000 375,000 375,000
Residential Street Reconstruction 300,000 300,000 300,000 300,000
Beaumont Traffic Circle 30,000 30,000 30,000 30,000
Curb and Gutter Maintenance and Repairs 50,000 50,000 50,000 50,000
Saratoga Hills Storm Drain Improvements 44,000 44,000 44,000 44,000
Bridge Maintenance and Repairs 50,000 50,000 50,000 50,000
EV Stations - 78,796 25,000 25,000
849,000 927,796 947,796 947,796 -
Pathways and Sports Courts 50,000 50,000 50,000 50,000
Sustainable Landscape Project 25,000 25,000 25,000 25,000
Village Creek Trail - Design & Environmental 80,000 80,000 80,000 80,000
Village Creek Trail - Construction Grant Match - 100,000 50,000 50,000
Via Regina Trail - 60,000 - -
Additional Quarry Park Funding for Restrooms - - 90,000 90,000
155,000 315,000 295,000 295,000 -
Prospect Center Furnishings 28,000 28,000 28,000 28,000
Theater - Boiler Replacement 90,000 90,000 90,000 90,000
Theater - Roof Top Duct Work 90,000 90,000 90,000 90,000
Single Pane Window Replacement - 40,000 40,000 40,000
WHH - Storage Building 45,000 30,000 30,000 30,000
278,000 278,000 278,000 278,000 -
Trak-iT Software system upgrade 60,000 - - - 60,000
City Website/Intranet Redesign 75,000 75,000 75,000 75,000
Village Specific Plan Update 100,000 100,000 100,000 100,000
235,000 175,000 175,000 175,000 60,000
1,517,000 1,695,796 1,695,796 1,695,796 60,000
185,796 - - (117,900) 645,459
FY 2015/16 CIP RESERVE FUNDING - Budget Direction
CIP RESERVE AVAILABILITY
REVISED CIP RESERVE FUNDING AVAILABILITY
RECOMMENDED
STREET PROJECTS
CIP Reserve
TOTAL PROJECT FUNDING:
ENDING CIP RESERVE BALANCE AVAILABLE
ADMINISTRATIVE PROJECTS
TOTAL FACILITIES PROJECTS
TOTAL ADMINISTRATIVE PROJECTS
PARK & TRAIL PROJECTS
FACILITY PROJECTS
TOTAL STREETS PROJECTS
TOTAL PARKS & TRAILS PROJECTS
Z:\Budget Directory\CIP Budget\FY 2015-16\Revised CIP Direction - 4.9.2015 4/9/2015
Project
Cost
1 Quito Road Sidewalk Improvements The project would fund sidewalk improvements on Quito Road between Highway 85
and Allendale Avenue.
150,000
2 Big Basin Way Turn Around Design and construction of a turn around at the end of the Village to improve
circulation through the Village. The budget increased due to the expected cost of a
Caltrans report and approval process.
500,000
650,000
3 Village to Hakone Trail Design and construction of a trail along Big Basin Way from Village to Hakone Gardens. 120,000
4 Congress Springs Park North Side Entrance Construct a trail connecting residential neighborhood around Cox Avenue east of
Highway 85 to northside of Congress Springs Park.
100,000
5 Via Regina Trail Construct a Pedestrian-Equestrian trail that would connect Via Regina and Villa Oaks
Lane.
60,000
6 Norton/Villa Montalvo Emergency Route Construct an emergency access road connecting the parking lot of Montalvo Arts
Center and Norton Road.
1,000,000
7 Joe's Trail at Saratoga de Anza Develop a trail from Saratoga-Sunnyvale to Arroyo de Arguello, includes costs for
design, environmental, acquiring easements and construction.
600,000
1,880,000
8 Civic Theater Master Plan Improvements Theater improvements include: design and construction of: ticket/concession area in
lobby; backstage dressing room; restroom annex; relocation of control booths; and
replacement of boiler and plumbing.
1,000,000
9 Solar Panels at City Hall Install solar panels on City Hall Admin Bldg to provide increased efficiency and energy
savings. Quarterly preventative maintenance will be included as part of regular staff
duties. Pay back on this installation will be possibly 20 years.
120,000
10 Renovate Existing Stage at Community Center This project would provide ADA accessibility and improve storage and safety at the
Community Center Multi-Purpose Room Stage. There are no ongoing costs for this
project. Rotary may provide $10K grant.
70,000
11 Community Development Lobby Remodel A lobby redesign to allow customers to remain at a single location while appropriate
staff members respond to customer's location during the planning and building
customer process, resulting in improved efficiencies and customer service.
100,000
1,290,000
3,820,000
FACILITY IMPROVEMENT PROJECTS
Project Descriptions
TOTALS
TOTAL FACILITY UNFUNDED PROJECTS
CIP - Unfunded List
FY 2015/16
TOTAL STREETS UNFUNDED PROJECTS
TOTAL PARKS AND TRAILS UNFUNDED PROJECTS
Project Title
STREET IMPROVEMENT PROJECTS
PARK & TRAIL IMPROVEMENT PROJECTS
Revision Date: 4/8/2015
CITY OF SARATOGA
INTRODUCTION SECTION
1
BUDGET & FINANCIAL POLICY
INFORMATION
CITY OF SARATOGA
INTRODUCTION SECTION
2
BUDGET PROCESS OVERVIEW
he City of Saratoga adopts an annual
Operating and Capital Budget. The Capital
Budget is in effect an annual update to the
five-year Capital Improvement Plan. The
budgets contain summary level information for
revenue and expenditure appropriations for the
fiscal year beginning July 1st and ending June 30th.
The budget documents are prepared on the same
basis as the City’s financial statements, and in
accordance with generally accepted accounting
principles (GAAP).
BUDGET PURPOSE
The Operating and Capital Summary Budget serves
as the City’s financial plan, as well as a policy
document, a communications tool, and an
operations guide. Developed with an emphasis on
long range planning, service delivery, and program
management, a fundamental purpose of these
documents is to provide a linkage between the
services and projects the City intends to accomplish,
and the resources committed to get the work done.
The format of the budget facilitates this linkage by
clearly identifying program purpose, key projects,
and workplan goals, in relation to revenue and
expenditures appropriations.
BASIS OF BUDGETING AND ACCOUNTING
Developed on a program basis with fund level
authority, the operating and capital budgets
represent services and functions provided by the
City in alignment with the resources allocated
during the fiscal year.
Basis of Budgeting and Accounting refers to the
timing factor concept in recognizing transactions.
This basis is a key component of the overall
financial system because the budget determines the
accounting system. For example, if the budget
anticipates revenues on a cash basis, the accounting
system must record only cash revenues as receipts.
If the budget uses an accrual basis, accounting must
do likewise. The City’s budgeting and accounting
systems both use a hybrid of modified accrual and
full accrual basis in the accounting and budget
systems.
The City’s Governmental Funds consist of the
General Fund, Special Revenue Funds, Debt
Service Funds, and Capital Project Funds.
Governmental Fund budgets are developed using
the modified accrual basis of accounting. Under
this basis, revenues are accounted for in the period
collected, or accrued if revenue amounts can be
determined and collected within sufficient time for
use in paying current period expenditures. Under
governmental accounting, principal and interest on
general long-term debt are budgeted as expenditures
when due – the liability for long term debt is not
included.
Proprietary fund budgets are adopted using the full
accrual basis of accounting whereby revenue budget
projections are developed recognizing revenues
expected to be earned during the period, and
expenditures budgeted for expenses anticipated to
be incurred in the fiscal year. The City maintains
one type of proprietary fund: Internal Service
Funds.
Fiduciary funds are also budgeted under the
modified accrual basis. Trust funds are subject to
trust agreement guidelines, and Agency Funds are
held in a custodial capacity involving only the
receipt, temporary investment, and remittance of
resources. Saratoga administers two agency funds.
SUMMARY OF BUDGET DEVELOPMENT
The City develops it budgets with a team-based
budgeting approach. City Management guides the
process through budget development; however
program budgets and workplans are developed with
each department program manager’s oversight and
expertise. This approach allows for hands-on
planning, and creates a clear understanding for both
management and staff of a program’s goals and
functions to be accomplished in the next budget
year.
BUDGET DEVELOPMENT PROCESS
Typically both the Operating and Capital Budget
processes begin in January with the City Council
and City Manager’s development and refinement of
initiatives and directives for the upcoming budget
year. Initiatives and directives are developed in
T
CITY OF SARATOGA
INTRODUCTION SECTION
3
conjunction with a review of the current year’s
budget status and the Five-Year Financial Forecast
at the annual Council Retreat. The forecast
provides an overview of service level operations as
it assesses funding sources and uses, and guides the
discussion for the upcoming budget direction.
The CIP is also reviewed during this time to
determine funding capabilities, project priorities,
and to refine project workplans. Although the CIP
Budget is a stand-alone body of work, CIP projects
may impact the City’s ongoing operations and
therefore must be incorporated into the Operating
Budget’s service level requirements.
In January, the budget preparation process begins
officially for staff. Budget assumptions, directives
and initiatives are provided to set the City’s overall
objectives and goals. Over several months, staff
identifies and analyzes program revenue and
expenditure projections in coordination with
Finance/Budget staff and City management.
Capital improvement projects are assessed and
refined, and CIP funding and appropriation
requirements are finalized.
Through rounds of budget briefings and revisions,
staff’s final program budget and workplans are
developed by the end of April; operational and
capital workplans are finalized, and the
Finance/Budget staff prepares financial summary
information for City Council review in addition to
departmental budgets and workplans.
BUDGET ADOPTION
During the month of May, the City Council reviews
the proposed Operating and Capital Summary
Budget, and the Capital Improvement Plan for the
five year period in a public hearing. Notice of the
hearing is published in a local newspaper at least ten
days prior to the Council’s public hearing date. The
public is invited to participate and copies of the
proposed budgets are available for review on the
City’s website, in the City Manager’s office and at
the budget hearing.
Under requirements established in Section 65401 of
the State Government Code, the City’s Planning
Commission also reviews the proposed Capital
Improvement Plan and reports back to the City
Council as to the conformity of the plan with the
City’s Adopted General Plan.
Final council-directed revisions to the proposed
budget are made and the budget documents are
resubmitted to the Council for adoption, again in a
publicized public hearing prior to the beginning of
the fiscal year.
Section 2-20.050(i) of Saratoga’s City Code
requires the City Manager to prepare and submit an
annual budget to the City Council. This is
accomplished in June, when the final proposed
budget is formally submitted to the Council in the
subsequent public hearing.
The approved resolutions to adopt the CIP and
operating budgets and the appropriation limitation
(Gann Limit) follow later in this section.
BUDGET AMENDMENTS
During the course of the fiscal year, economic and
workplan changes or unanticipated needs may
require adjustments to the adopted budgets. The
City Manager is authorized to transfer
appropriations between categories, departments,
projects, and programs within a fund in the adopted
budget, whereas the City Council holds the
authority for budget increases and decreases and
appropriations or transfers between funds.
CITY OF SARATOGA
INTRODUCTION SECTION
4
BUDGET CALENDAR
December
January
February
March
Budget Office to begin development of financial forecast and budgets for
following fiscal year, including:
Draft operating budget revenue and expenditure projections
Prior fiscal year-end fund balance available for CIP
Budget Office to prepare Mid-Year Budget Report and Five-Year Financial
Forecast for Council review at annual retreat
For Operating Budget:
Budget Office to provide budget information to staff on budget
assumptions, directives, initiatives, and goals
Budget Office and Program Managers to prepare Internal Service and
Equipment Replacement Fund analyses and schedules, finalize internal
service rates
Budget Office to prepare operating budget worksheets for updates,
including departmental/program narratives, staffing and financial
worksheets, asset and staffing requests.
For Capital Budget:
Budget Office to prepare updated five-year CIP project worksheets
Budget Office and departments to review current User Fee Schedule for
appropriate changes in preparation of annual updates process
For Operating Budget:
Budget Office to finalize Internal Service Fund program workplans
Budget Office to prepare budget worksheets for departments, including
staffing and internal service program costs
Departments to prepare draft revenue expenditure workplans
For Capital Budget:
Project Managers to finalize funding estimates, scope of work, and cost
estimates for new proposed projects
For Operating Budget:
Departments to finalize budget work plans
Review proposed budgets with City Manager
Departments and Budget Office to finalize budget changes
For Capital Budget:
Project Managers to determine year end CIP project estimates
City Manager to approve recommended proposed CIP projects
CITY OF SARATOGA
INTRODUCTION SECTION
5
April
May
June
July/
August/
September
For Operating Budget:
Departments to finalize program narratives and Performance
Measures
Budget Office to compile final program narratives, financial and
supplemental schedules, and financial budget summaries and charts for
City Council Budget Study Session
For Capital Budget:
Project Managers to finalize new project information for CIP submittal
Public Works Manager to bring new projects to Planning Commission
meeting for General Plan conformance review
City Council to hold Public Hearing for Annual User Fee Update
City Council to hold Budget Study Session
For Operating & Capital Budgets:
Final budget briefing with City Manager
Budget Office to incorporate Council directed changes into proposed
budgets and prepare final documents for Public Hearing presentation
City Council to hold Proposed Budget Hearing
For Operating & Capital Budgets:
City Council revisions incorporated into budget documents
City Council adoption of Operating and Capital Budget
City Council adoption of Gann Appropriation Limit
Final document preparation of financial and supplemental schedules, charts,
reference materials, etc.
Adopted Operating and CIP Budget documents finalized, posted on website,
and distributed
CITY OF SARATOGA
INTRODUCTION SECTION
6
CITY OF SARATOGA
INTRODUCTION SECTION
7
FISCAL MANAGEMENT POLICY STATEMENTS
With both a general management philosophy and Council goal to practice fiscal responsibility, the City of
Saratoga’s conservative and cautious financial management is achieved through responsible, sustainable, and
enforceable fiscal policies and internal controls to ensure prudent and efficient use of resources. These policies
and controls represent long-standing accounting, budgeting, debt, investment, and reserve principles and
practices, and are the foundation which guides the City in maintaining its fiscal stability.
The following general fiscal management policy statements provide an overview of financial, operational, and
budgetary management and act as a guideline for fiscal operations. As many fiscal policies are administrative
in nature, detail level policy direction are not included in the budget document. However, fiscal policies that
rise to Council review and approval standards are incorporated into the budget document for annual adoption by
Council.
Council approved detail fiscal policies include the Fund Balance Reserve Policy and the Capital Project Process
Policy. Others will be added as approved. The Council approved detail fiscal policies follow the Fiscal
Management Statements within this policy section.
General Financial Principles
The City’s fiscal policies are structured to ensure fiscal responsibility, accountability, transparency, and
efficient use of resources. Fiscal policies are to be reviewed, updated, and refined as necessary, with general
policy level decisions brought to City Council for review and approval, and operation level functions
approved by the City Manager.
The City Council’s financial based goals, objectives, and policies are incorporated into and implemented
with the development and adoption of the City’s Operating and Capital Budgets.
Efforts will be coordinated with other governmental agencies and joint power associations to achieve
common policy objectives, share the cost of providing governmental services, and support legislation
favorable to cities at the state and federal level.
The City will seek out, apply for, and effectively administer federal, state, local, and foundation grants
which address the City’s current priorities and policy objectives.
Appropriations and Budgetary Control
The City Council adopts an annual balanced operating budget and the first year of an integrated five-year
capital improvement plan budget on an annual basis, to be effective for the fiscal year running from July
1st through June 30th. Balanced budgets present budgeted sources in excess of budgeted uses. Budgeted
“Sources” include Revenues, Transfers In, and Appropriated Uses of Fund Balance. Budgeted “Uses”
include Expenditures and Transfers Out. Operating and capital budgets are to align with the City’s long-
term financial goals.
The City’s budget practices utilizes long-range planning as a decision- making tool, and annually adopts a
structurally balanced financialscal plan that retains the City’s fiscal health, preserves essential services, and
supports short and long-term goals in a financially judicious manner.
CITY OF SARATOGA
INTRODUCTION SECTION
8
Each year the Finance & Administrative Services Department provides an updated five year financial
forecast to the City Council at the Annual Council Retreat (scheduled in late January or early February)
to assist Council with formulating direction for long-range planning, operating budget development, and
capital funding appropriations.
Budgets are prepared on the same basis of accounting used for financial reporting: governmental fund
types (General, Special Revenue, and Debt Service) are budgeted according to the modified accrual basis
of accounting; proprietary funds (Internal Service Funds) and fiduciary funds are budgeted under the
accrual basis of accounting.
The City policy is to fund the Operating Budget is primarily funded with current year revenues. Dedicated
fund balance reserves, such as the Carryforward Reserve or the Fiscal Stabilization Reserve may be used
with Council approval to fund current operational expenses that extend beyond the annual fiscal year, or
were funds collected and dedicated for longer term use. Council may also approve the use of long-term
debt for operational liabilities if fiscally prudent.
City policy is funding, and to fund the Capital Budget with surplus and dedicated capital funding resources.
Dedicated funding sources include Gas Tax (HUTA) revenues, road impact assessment revenues; grants;
community benefit assessments; and federal, state, local, and private grants.
In practice, budgeted revenues are conservatively stated and budgeted expenditures are comprehensive,
allowing for the annual operational and capital improvement goals to be completed. With effectively
managed revenue streams and efficient use of resources, fiscal year-end operational budget surpluses are
available to fund future capital improvement projects and contribute to the City’s fiscally responsible
reserve accounts.
The City Council maintains budgetary control at the fund level; any changes in total fund appropriations
during the fiscal year must be submitted to the City Council for review and Council majority approval.
Operating Budget appropriations lapse at the end of each fiscal year unless specifically re-appropriated by
the City Council in the following fiscal year. Capital Budget appropriations are structured as a multi-year
workplan; therefore project expenditure balances are carried forward to the following fiscal year as part of
the annual budget adoption until funding is exhausted or the project is completed.
The City Manager is authorized to implement the City’s workplan as approved in the adopted budget.
Within a specific fund, the City Manager may transfer appropriations between categories, departments,
programs, and projects as needed to implement the adopted budget, provided no change is made to the total
appropriation amount provided for any one fund.
Generally, Rrecurring expenditures are to be funded with recurring revenues, or funds revenues specifically
designated for operational use. One time expenditures may be funded with one-time revenues or fund
balances reserves. Fund balance reserves are to be used for non-recurring one-time expenditures and capital
projects.
The City Council has established a $50,000 annual ‘Council Contingency’ appropriation for Council
approved unplanned expenditures. Unexpended appropriations are carried forward into the following fiscal
year.
The Recreation Department cost recovery rate is to exceed goal of 65% was established to match the
California Parks & Recreation Society’s (CPRS) average cost recovery rate for all California recreation
departments at the time the policy was set. as established in the current CPRS benchmarking report
(approximately 65%).
The Community Development Department cost recovery rate strives to attain close to full cost recovery as
development and building services are primarily for individual enrichment rather than a community
enrichment function. As some aspects of the department’s function provide community benefits, the
general fund offsets those years with a shortfall between revenues and expenditures.
CITY OF SARATOGA
INTRODUCTION SECTION
9
The annual Operating Budget will include a General Fund transfer of $100,000 to the Facility Improvement
CIP for minor facility improvement projects outside of typical maintenance and repair work funded through
the Building Maintenance program.
The CIP Street Resurfacing/Pavement Management CIP project program has an established minimum
annual funding goal of $1,000,000, with dedicated funding from Gas Tax Revenues, and the Solid Waste
services contract assessed RoadVehicle Impact Fees as designated funding sources.
Council has designated the following capital projects as fundamental to maintaining City infrastructure on
an ongoing basis, and are therefore directed to have priority for available Capital Project funding in the
amount of $50,000 each year:
1. Annual Sidewalk Repairs
2. Annual Storm Drain Repairs
3. Roadway Safety and Traffic Calming
4. Risk Management ADA Mitigation Projects
Auditing and Financial Reporting
California State statutes require an annual financial audit of the City’s financial records and transactions by
independent Certified Public Accountants. The City shall comply with Generally Accepted Accounting
Principles (GAAP) and produce annual financial reports pursuant to Governmental Accounting, Auditing,
and Financial Reporting (GAAFR) guidelines.
Additional financial reports issued by the Auditor’s may include: Singe Audit Report (annual report of
federal grant expenditures if in excess of the federal single audit limit is expended in a fiscal year), a
Transportation Development Act (TDA) report (annual report of TDA fund expenditures), an
Appropriations Limit review report (to establish tax revenue appropriation limit), and a Management report
on the City’s Internal Controls.
A State required Annual Cities Report, and Annual Streets Report are also completed in conjunction with
the year-end close.
Weekly check registers and monthly Cash and Investment Reports will be submitted for review and
approval at City Council meetings. Quarterly financial reports will provide a status update on General Fund
revenues and expenditures for the first, second, and third quarters. A year-end recap is to be provided after
the City’s annual financial audit is completed.
At mid-year, a budget status report is presented at the City Council retreat with which includes a more
comprehensive financial overviewreview and includes proposed budget adjustments as appropriate.
Development Related Financial Policies
The Development Reserve was established to provide stability for multi-year development related project
services. The reserve is funded by Community Ddevelopment Department revenues in excess of
development expenses at fiscal year-end. The reserve is available for use in those years where a shortfall
occurs; when development revenues fall below development expenses. Use of the reserve for operational
support is limited to a maximum of 1/3 of the reserve balance in any given fiscal year; with any
budgetedplanned use of the reserve automatically rescinded up to the amount development revenues are
sufficient to cover General Fund net operations. The reserve may also be utilized for other development
related uses, such as funding development software upgrades or special projects, per Council direction.
Additional information on this Development Reserve is located in the Fund Balance Reserve Policies
section. (page 44).
CITY OF SARATOGA
INTRODUCTION SECTION
10
The Williamson Act, also known as the California Land Conservation Act, was passed by the California
Legislature in 1965 to encourage rural & agricultural land owners to keep their land undeveloped. When
land owners enter into a contract under the act, they benefit from lower property taxes, which are based
on the property’s current use, rather than paying market value based tax rates. In exchange, the property
is to remain undeveloped and continue to function in the same manner for the duration of the
contract. Contracts run for 10 years and are automatically renewed unless the farmer or rancher cancels
it. The City does not limit the number of Williamson Act contracts entered into each year.
The Mills Act is State-sponsored legislation granting local governments the authority to enter into an
agreement with property owners to allow reduced property tax payments in return for the restoration and
continued maintenance of their historic property. Since the agreement reduces property tax assessment,
the City receives a smaller share of property tax revenue in comparison to a property that is assessed at
market value. The City will allow approval of up to three Mills Act Contracts per year.
Expenditures and Purchasing
All expenditures shall be in accordance with the City’s purchasing policy, travel policy, credit card policy,
agreement, contract policy and public contract code, state or federal law, or any other applicable guidelines
or regulations.
Expenditures are managed at the program level. Program managers are to ensure expenditures do not
exceed the budgeted workplan and must take immediate action if at any time during the fiscal year an
operating deficit is projected at year-end. Corrective actions may include expenditure reductions, or with
Council approval, budget adjustments, or service reductions, or service fee increases.
The City’s current purchasing policy, (effective date of 4/23/2007) establishes purchasing authority levels,
purchasing procedures, and procedural requirements, for the procurement of supplies, equipment, and
services, in conformance with Federal and State codes and regulations, and City Ordinance No. 2-45.
Public Work projects governed by the State’s Public Contract Code are excluded from provisions of the
City’s purchasing policy.
Guidelines established by the City’s Purchasing Policy directs the City’s departments to purchase the best
value obtainable, securing the maximum benefit for funds expended, while providing all qualified vendors
an equal opportunity to do business with the City.
Services and supplies purchases thatwhich exceed $5,000 require written quotes, and must be approved by
the Purchasing Officer or designee, typically through the Purchase Order process. Documentation is to be
retained by the department in accordance with the records retention policy and schedule.
Services, and supplies, and fixed asset purchases exceeding $25,000 must be authorized by the City
Council, unless purchase is specifically called out in the adopted budget (such as vehicle and equipment
replacements) or type is excluded under the Purchasing Policy.
Fixed Assets and Infrastructure
Tangible assets with a cost equal to or greater than $10,000 and a useful life of more than one year are
considered fixed assets and added to the capitalization schedules. Repairs and maintenance of infrastructure
assets will generally not be subject to capitalization unless the repair extends the useful life of the asset.
The City will sustain a long-range fiscal perspective through the use of a five-year Capital Improvement
Plan designed to maintain the quality of City infrastructure, including streets, sidewalks, curbs and storm
drains, lighting, building, parks, and trees, and through Internal Service Fund programs to both maintain
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and replace City building infrastructure, fixtures, and equipment, vehicles, and public works and technology
equipment on an ongoing basis.
Asset information is retained to provide information for preparation of financial statements in accordance
with GAAP, with emphasis placed o n completion of GASB 34 requirements.
Internal Service Funds
Internal Services Funds are established to both equitably allocate operating costs to departments for support
and maintenance services, and to stabilize and spread the City’s replacement and operational costs over
fiscal years for the purpose of providing an accurate and balanced long-range fiscal perspective of the use
of services and assets.
Vehicles, Equipment, and Building aAsset replacement and maintenance types of Internal Service Funds
are structured to provide a consistent level of funding for asset replacement and equipment replacement,
and to building maintenance projects, and ensure sufficient funding is available for the regular maintenance,
and repair, and replacement of the City’s vehicles, equipment, and buildings fixtures in an ongoing manner.
Technology and Office Equipment replacement and maintenance Internal Service Funds are structured to
provide a consistent level of funding for the replacement of technology assets and projects, and to
appropriately distribute support and maintenance costs to departments.
The Liability and Workers Compensation Insurance Internal Service Funds shallare to maintain adequate
reserves to pay all valid self-insured claims and insurance deductibles, including those incurred but not
reported, in order to keep the insurance funds actuarially sound.
Each Internal Service Fund will set recovery charges at rates sufficient to meet all operating expenses,
depreciation, and fund balance reserve policy objectives.
Long-Term Debt
The City does not incur debt for operations or capital improvements except under extraordinary
circumstances and with citizen support. Under these circumstances the City will seek voter approval for
General Obligation (GO) Bond Debt for major infrastructure rehabilitation.
Long-term Financing Debt is typically incurred for will be confined to capital improvements or special
projects that cannot be financed from current or dedicated revenues, or for large liabilities resulting in
significant financial impacts. In principal, long-term debt and is to be used only if the debt service
requirements do not negatively impact the City’s ability to meet future operating, capital, and cash reserve
policy requirements.
The term for repayment of long-term financing shall not exceed the expected useful life of the project, or
extend beyond functionally appropriate payment terms.
Revenues
The City will encourage a diversified and stable revenue system to offset short-run fluctuations in any one
revenue source, in part through balancing revenue fluctuations to related operational fluctuations –such
as Community Development’s multi-year service revenues and contract services fluctuate with service
needs.
Designated and legally restricted tax and revenue funding sources will be accounted for in the appropriate
funds. General taxes and revenues not allocated by law or some other contractual agreement to other
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funds are accounted for in the General Fund. Dedicated Capital pProject revenues are to be directly
accounted for in the appropriate capital project fund, within a designated project.
The City typically establishes user charges and fees at levels that recover the direct and indirect activity
cost of providing a service or product. The City also considers market rates and charges levied by other
municipalities of similar size for like services in establishing rates, fees, and charges. As some services
have partial cost recovery objectives, cost recovery ratios will vary in accordance with policy objectives.
A master schedule of User Fees is reviewed and updated each year to adjust fees to the established level.
The City will follow an aggressive policy of collecting local taxes and revenues due to the City through
persistent follow-up procedures, and external resources as necessary.
Donations may be accepted in accordance with the Cit of Saratoga Donation Policy most recently
approved by the City Council. Under the current policy, Unrestricted donations of $5,000 or less may be
accepted or declined by the City Manager. Restricted donations of $500 or less may be accepted or
declined by the City Manager. Unrestricted donations of more than $5,000 and restricted donations of
more than $500 must be brought to the City Council for consideration. , gifts, and bequests to the City in
excess of $5,000 must be brought to Council for approval and acceptance. All restricted donations, gifts
and bequests must be submitted to the Council for approval prior to acceptance. The City Manager may
choose to request City Council consideration of any donation, regardless of value.
Risk Management Policy
The City is insured for up to $25 million of general liability, auto, and property damage claims through the
Association of Bay Area Government’s (ABAG) Pooled Liability Assurance Network (PLAN)
Corporation. The City is self-insured for the first $25,000 for general liability and auto claims; property
damage after $5,000 and third party auto claims after $10,000.
Workers Compensation claims are insured for the first $250,000 of coverage through the City’s
participation in a Workers Compensation risk pool, known as SHARP (Shared Agency Risk Pool). After
the $250,000 limit is met, an excess coverage policy is activated. The excess coverage provides an
employer liability limit of $5,000,000 per occurrence, and workers’ comp per occurrence limit of
$100,000,000. Workers' Compensation claims are managed by a third party administrator.
The City’s role in managing both its risk management and workers comp programs is to be preventative in
nature which is accomplished through careful monitoring of losses, working closely with the third party
administrator, and designing and implementing programs to minimize risk and reduce losses.
Treasury Management
California Government Code Section 53600; City of Saratoga Municipal Code Section 2-20.035; and
Section 16.0 of the City of Saratoga Investment Policy require the City Council to annually review and
approve the City’s Investment Policy.
It is the policy of the City of Saratoga to invest public funds in a manner which will provide the maximum
security with the highest investment return, while meeting the daily cash flow demands of the City and
conforming to all state and local statutes governing the investment of funds.
The City practices conservative and cautious investment practices through limiting its investments to the
State’s Local Agency Investment Fund (LAIF). LAIF’s extensive professional investment staff and
conservative investment practices ensure prudent financial management of the City’s fiscal reserves.
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The Administrative Services Department’s Finance Division shall prepare a monthly report to the City
Council that has sufficient detail to present the financial condition of the City at month end, the cash and
investments balance by fund, and fund balances by fund type.
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FUND BALANCE RESERVE POLICY
Prudent financial management dictates that the City reserve a portion of its funds for future use to: maintain
fiscal stability; ensure the continued orderly operation of government, and provision of services to residents;
and to mitigate current and future risks.
As a general budget precept, the City Council decides when and whether to appropriate available funds to and
from a reserve account. Use of reserve funds must be authorized by either specific direction in the annual
budget, or by a separate City Council action unless specifically noted byin policy. Responsible fiscal
stewardship also requires adequate reserve be maintained for all known liabilities and established City Council
and community directed initiatives.
In the following Fund Balance/Reserve Policy overviews, the descriptions include identification of the fund
type and classification, the purpose of the reserve, minimum and maximum funding goals if appropriate,
guidelines on utilization of the reserve and by what authority, and the procedure for funding the reserve
initially, on an ongoing basis, or after utilization.
Fund Balance and Net Position
In 2009, Governmental Accounting Standards Board (“GASB”) Statement No. 54 revised fund balance
classifications for “Governmental Funds” into five specific classifications of fund balance with the intent to
identify the extent to which a specific fund balance reserve is available for appropriation and th erefore
spendable, or whether the fund balance reserve is constrained by special restrictions. Government Funds for
which these new rules apply include: the General Fund, Special Revenue Funds, Capital Project Funds, and
Debt Service Funds.
For “Non-Governmental Funds”, equity classifications are classified as “Net Position” with sub-
classifications of Restricted or Unrestricted Net Position. A third component of a Non-Governmental Fund’s
equity is “Net Investment in Capital Assets,” which for the City refers to the non-monetary portion of equity
such as vehicles and equipment, net of depreciation. Non-Governmental Fund types include Proprietary
Funds (Enterprise and Internal Service Funds) and Fiduciary Funds (Trust Funds). Currently, the City’s non-
governmental fund types are limited to Internal Service Funds.
Governmental Fund Type Reserve Classifications
The Governmental Reserve classifications are defined as follows, including the applicable reserves that fall
into the classification:
Non-Spendable Fund Balance
Represents resources that are inherently non-spendable from the vantage point of the current period. The
City does not presently hold Non-Spendable Reserve funds
Restricted Fund Balance
Represents fund balance that is subject to external enforceable legal restrictions. The City maintains the
following restricted fund balances under this designation:
General Fund: Environmental Services Fund Balance Reserve
Special Revenue Funds: Landscape & Lighting Assessment Districts Fund Balance
Debt Service Fund: Library General Obligation Bond Debt Service Fund
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Committed Fund Balance
Represents fund balance constrained by limitations the government imposes upon itself at its highest level
of decision making and remains binding unless removed in the same manner. The City maintains the
following fund balances under this designation:
General Fund: Hillside Stability Reserve
General Fund: Facility Reserve
Capital Improvement Plan Funds: Capital Project Reserves
Assigned Fund Balance
Represents fund balance identified by Council for an intended use; however as no legal obligations exist,
the funds may be re-designated and utilized for another purpose if Council chooses. The City maintains
the following General Fund reserves under this designation:
General Fund: Future Capital Improvement & Efficiency Project Reserve
General Fund: Carryforward Reserve
Unassigned Fund Balance
Represents funding which may be held for specific types of uses or operational funding/stabilization
purposes, but is not yet directed to a specific purpose. Only General Fund reserves can be designated
under the “Unassigned” fund balance classification. Other fund types are by nature structured for specific
purposes, hence the fund balances are therefore considered “assigned” for that purpose.
General Fund: Working Capital Reserve
General Fund: Fiscal Stabilization Reserve
General Fund: Development Services Reserve
General Fund: Other Unassigned Fund Balance Reserve
Fund Balance Ratios
To ensure the City maintains available working cash flow and emergency funding at all times, the
collective total of the General Fund’s Assigned and Unassigned Reserves shall is to be sustained at a
minimum of 20% of General Fund expenditure appropriations, net of transfers out. .
General Fund Year-End Allocations
After the City’s financial records are finalized and audited, with legal obligations and liability reserves funded,
revenues in excess of expenditures are closed out to the Other Unassigned Fund Balance Reserve. Funding
in excess of the $500,000 that is to remain in the Other Unassigned Fund Balance Reserve will be distributed
in the following order:
1. Working Capital Reserve interest allocation.
2. Repayment of Fund Balance Reserve loans - back to established levels (e.g. borrowing from the Fiscal
Stabilization or Hillside Stability Reserves).
3. Annual contribution of $100,000 to Hillside Stability Reserve, until reserve balance reaches
$1,000,000.
4. Annual contribution of $300,000 to Facilities Replacement Reserve.
5. Remaining funds are allocated to the Future Capital Improvement and Cost Efficiency Projects
Reserve.
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GENERAL FUND – FUND BALANCE RESERVE POLICIES
Environmental Services Reserve
Under the Restricted Fund Balance classification, the Environmental Services Reserve represents revenues
collected under a prior funding structure for environmental purposes, and is therefore restricted for use in
funding environmental program costs such as clean water programs, street sweeping, and storm drain cleaning
services. Per policy, the Environmental Service Reserve is being utilized through annual budget
appropriations of $50,000.
The Environmental Services Reserve originated from a one-time funding structural change and therefore will
not be replenished when depleted.
Hillside Stability Reserve
Under the Committed Fund Balance classification, a Hillside Stability Reserve of $1,000,000 is to provide
funding for unanticipated or unforeseen emergency or extraordinary costs related to hillside degradation,
inclusive of slide prevention and mitigation, slide repair, and associated drainage and roadwork. The reserve
is to be increased by $100,000 each fiscal year from General Fund year-end net operations until a $1,000,000
reserve cap is reached.
Use of the reserve requires an analysis be prepared and presented to Council for approval, or in the event of a
landslide requiring immediate emergency work, the Public Works Director may direct use of up to 10% of the
reserve to make emergency repairs and mitigate further damage until Council takes action. Reserve funding
is to be used for emergency work which exceeds operational funding provided for in the Operations Budget.
Upon use, refunding of the reserve shall again resume at $100,000 each fiscal year until the $1,000,000 reserve
cap is reached.
Facility Replacement Reserve
The Facility Replacement Reserve is established to accrue funding for the major rehabilitation or replacement
of City Buildings. Eligible uses of this reserve to finance the construction of critical City facilities include
direct funding of public facility improvements, and the servicing of related debt.
An initial contribution of $300,000 was established in FY 2012/13 with Council’s recommendation to
continue funding at this level as available. Annual contributions, reserve goal amount, and utilization shall
be determined by Council as the City’s economic situation changes.
Future Capital Improvements & Efficiency Projects Reserve
Under the Assigned Fund Balance classification, the Reserve for Future Capital Improvement & Efficiency
Projects shall reserve funding for as yet undefined capital and efficiency improvement projects. Reserve
funding is derived from General Fund accumulated net operations (as available) and is therefore considered a
“one-time funding source”. Funds are held in this reserve until Council reviews funding requests and approves
a use or transfer to a capital project fund.
Use of the reserve funding is at the Council’s discretion, but typically occurs in conjunction with the annual
budget adoption after Council conducts a comprehensive review of capital and efficiency improvement needs.
Reserve replenishment is dependent upon net operational savings in subsequent fiscal years.
Carryforward Reserve
Under the Assigned Fund Balance classification, the Reserve for Carryforwards represents funding held at the
end of each fiscal year for critical unexpended operating budget appropriations to be purchased in the
following fiscal year, and any remaining Council Contingency funding. The reserve is reconciled at the end
of each fiscal year to both release prior year carryforward funding and reserve current year carryforward
funding into the following budget year.
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Staff determines the year-end reserve amount after all fiscal year payments are finalized; the reserve amount
is conceptually appropriated by Council each year in the budget adoption resolution.
Working Capital Reserves
In accordance with the City’s cautious and conservative fiscal philosophy, the City’s general prevailing
financial policy holds that the City should fund daily operations with current resources in order to avoid use
of short-term Tax Revenue Anticipation Notes (TRANs).
To support this policy a Working Capital Reserve is established to meet cash flow requirements and prevent
short-term borrowing, which in turn ensures the continuance of services to the public while also maintaining
the City’s credit worthiness. To provide adequate working capital, the City shall maintain, in conjunction
with the Fiscal Stabilization Reserve, a minimum reserve of 60 days of the following year’s General Fund
budgeted expenditures net of internal service charges and transfers out, and up to a maximum reserve amount
equal to 90 days of the following year's General Fund budgeted expenditures, net of internal service charges
and transfers out.. This reserve falls under the Unassigned Fund Balance classification.
A Working Capital Reserve of $2,000,000 was established in April 1994. Effective June 30, 2000, interest
earnings accrue to the reserve at the end of each fiscal year based on the annual LAIF rate, for the purpose of
increasing with the intention to increase the reserve balance amount in proportion to Operating Budget
increases.
In 2014, accumulated interest earnings of $930,184 were utilized to pay off a portion of the City’s Unfunded
Accrued Liability, bringing the Working Capital Reserve back to the initial $2,000,000 funding level.
Fiscal Stabilization Reserve
Under the Unassigned Fund Balance classification, a Fiscal Stabilization Reserve of $1,500,000 was
established to provide temporary financing for budget stabilization caused by fiscal downturns, unanticipated
extraordinary expenditures related to a natural disaster or calamity, or from an unexpected liability or funding
decrease created by a legislative action.
Fiscal stabilization needs may occur from revenue declines (over one or more years) of more than 5% of either
property tax, the combined total of other taxes, or General Fund revenues in total, or from unanticipated
extraordinary operational increases of more than 5% such as from a natural disaster or unexpected Federal,
State, or County or CalPERS funding changes.
Council may utilize funding at budget adoption, by adoption of a budget adjustment resolution during the
course of the year, or after a Federal, State, or locally declared emergency. In the event a locally declared
emergency takes place, the City Manager has the authority to spend funds until such time as the City Council
takes action. Reserve appropriations are to be replenished from year-end net operations, as available, on a
priority basis.
Development Services Reserve
Under the Unassigned Fund Balance classification, the Development Services Reserve provides fiscal stability
for the Community Development Department’s planning and building programs. Development projects are
often multi-year activities in which revenues may be collected in one yea r, while project expenditures may
extend over several years.
This reserve represents accumulated excess planning and building net operation funds from years when
development revenues exceeded development expenditures. The reserve funds are is subsequently utilized to
offset excess planning and building program expenditures through annual budget appropriations in the years
where revenues are not sufficient, thereby acting as an overall funding stabilizer for multi-year development
activities.
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Use of reserve funding for operational support is restricted to 1/3 or the reserve balance in any given fiscal
year, with Council approval. Budgeted use of the Development Reserve is to be rescinded if and to the point
where development revenues are sufficient to cover General Fund net operations at year-end. The reserve may
also be utilized for other development related uses, such as for development software upgrades or special
projects, per Council direction. Funds are added to the reserve in years where Community Development
Department revenues exceed Development expenditures.
Compensated Absences Reserve
Under the Unassigned Fund Balance classification, the Compensated Absences Reserve is established to
smooth expenditure fluctuations resulting from the payout of accrued leave to employees at service separation
and distribution payouts. Initial reserve funding is to be established at $200,000, with a targeted goal of one-
third of the compensated absences liability established at year-end. Reserve funding in excess of one-third of
the liability is to be returned to the General Fund Other Unassigned Reserve.
Use of the reserve occurs when total annual compensated absences payouts exceed budgeted salary funds.
Large payouts decrease the compensated absences liability at year-end, thereby supporting the practice of
utilizing the reserve as needed. The reserve may be replenished over a three year period. Year-end
reconciling allocations to and from the reserve are approved though Council’s budget resolution adoption each
fiscal year, with the liability and resulting reserve amounts determined as part of the year-end close process.
Council Discretionary Reserve
Under the Unassigned Fund Balance classification, the Council Discretionary Reserve represents unspent
funds from the Council’s annual appropriation. The reserve provides a mechanism to roll forward remaining
Council Discretionary Funds as reserve funds are immediately re-appropriated into the following fiscal year.
This allows Council the flexibility to take advantage of unforeseen opportunities or needs without the
restriction of fiscal year boundaries. Use of the reserve funding requires Council majority approval. The
reserve exists at year-end only when there are remaining unspent Council Discretionary funds at the end of
the fiscal year.
Other Unassigned Reserve
The ‘Other Unassigned Reserve’ represents accumulated net operations not yet allocated to other fund balance
reserves, and by definition, fall into the Unassigned Fund Balance classification. In the General Fund, a
baseline of $500,000 of accumulated net operations is to remain in the Other Unassigned Fund Balance
Reserve at year end to provide a buffer for unanticipated operational shortfalls and unforeseen needs.
Other fund’s accumulated net operations are typically accounted for in an undefined reserve account –
typically just called fund balance reserve. As the other types of funds are structured for specific uses or
commitments, their fund balance already has a directed purpose, whereas the General Fund is used for multiple
operational purposes thereby requiring a distinction of purpose for each reserve.
Council may utilize reserve funding at budget adoption or by adoption of a budget adjustment resolution
during the course of the year. Reserve funding is replenished from year-end net operations, as available.
SPECIAL REVENUE FUND – FUND BALANCE RESERVE POLICIES
Landscape & Lighting Assessment District Funds
Assessment District Funds are Special Revenue Funds, which is a type of governmental fund. As a
governmental fund, the Landscape and Lighting Assessment District Funds comply with GASB 54 fund
balance classifications, and by nature of the fund’s purpose, fund balance reserves are classified as restricted
reserves.
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Special Revenue Funds account for and report the proceeds of specific revenue sources that are restricted or
committed to specified purposes (other than for debt service or capital projects.) For the City, Landscape &
Lighting District Special Revenue Funds were established to account for each individual assessment district;
thereby each fund has its own separate fund balance reserve.
Each district’s fund balance reserve should be sufficient to provide working capital to cover operational
expenses through the first half of assessment receipts in January, therefore equitable to approximately one-
half of a district’s annual expenditure budget. The second half of receipts are received in June. Some districts
may include capital improvement projects in addition to ongoing regular maintenance resulting in fund
balance increasing over the years to accumulate sufficient resources for the improvement projects. As each
district’s situation is different, a district’s maximum fund balance shall be determined by the Public Works
Director.
Requests for use of the reserve are approved by Council through budget adoption or by a Council approved
budget adjustment resolution throughout the year. The reserve is replenished from the Fund’s net operations
in subsequent years.
DEBT SERVICE FUND – FUND BALANCE RESERVE POLICIES
Library General Obligation (GO) Bond Debt Fund
The Library General Obligation (GO) Bond Debt Fund is a Debt Service Fund established to account for the
financial resources accumulated for principal, interest, and cost of issuance expenditures associated with the
Library Bond Debt. As Debt Service Funds are a governmental fund type, the fund reserves fall under the
GASB 54 fund balance classifications. Debt Service Fund reserves are classified as Restricted as funding can
only be spent for specific purposes as stipulated by the bond covenants.
The Library GO Bond Debt Fund was established to ensure receipts are tracked separately, and funding is
available for the GO Bond debt service requirements. At a minimum, the year-end fund balance reserve shall
be sufficient to provide working capital to cover the semi-annual principal and interest debt payment due on
August 1st as GO Bond tax receipts are received after the 1st debt payment is due. December receipts provide
for the February payment. As bond assessments are collected as a percentage of property values, reserves
should provide sufficient funding to compensate for tax fluctuations. The fund’s reserve maximum should be
no more than one-year of budgeted annual expenditures.
The reserve balance is increased (or reduced) through establishing assessment rates at more (or less) than the
semi-annual payments and bond services require. Therefore, replenishment (or use) of the reserve is approved
by Council through budget adoption and implemented through an increased (or reduced) assessment rate as a
result of the fund’s net operations.
CAPITAL IMPROVEMENT PROJECT FUNDS – FUND BALANCE RESERVE POLICIES
Overview
Capital Improvement Project (CIP) Funds account for the acquisition and maintenance of major capital assets
other than those financed through special assessments or enterprise funds. Capital Project Funds are a type
of governmental fund and therefore comply with GASB 54 fund balance classifications. As Council directs
appropriated funding be spent for specific improvement projects, the Capital Project Fund Balance Reserves
are classified as Committed Fund Balance.
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Budgeted capital improvement project funding is determined by the scope of work approved by Council, and
remains assigned for that use until completed or reassigned by Council. Fund Balance amounts represent the
total remaining funds in the individual projects at year-end. As Fund Balance amounts are determined by the
point of project completion at year-end they cannot be standardized for minimum or maximum amounts. Fund
Balance is re-appropriated to the capital project in the following fiscal year for the work to be completed.
Street Improvement Projects Funds
Street Improvement Project Funds provide for a safe and functional roadway and pedestrian street system.
Each Street Improvement Fund (CIP Street Fund, CIP Grant Fund, and Gas Tax Fund) has multiple projects
which roll up into the overall fund balances, but remain designated for use by project.
The CIP Street Fund receives annual funding from fees, reimbursements, contributions, and transfers from
other funds. The CIP Grant Fund receives federal, state, and local grants which vary in source and amount
from year-to-year. On occasion, a private grant may be received. Typically, CIP Grant Funds have a negative
fund balance as project work is conducted before reimbursement is received. Gas Tax Funds represent annual
Highway User Tax and Transportation Congestion Relief revenue allocations that are to be accounted for
separately and are subject to State audits.
Year end fund balance represents the remaining unexpended project funds (net of any negative CIP Grant
Fund Balance) which are subsequently re-appropriated by Council into the following budget year through
budget adoption.
Park & Trail Improvement Project Funds
Park & Trail Improvement Project Funds provide for capital improvements to the City’s neighborhood and
city parks and plaza, the sport fields, bike and pedestrian trails, and open space areas throughout the City.
Each of the Park & Trail Improvement Funds (CIP Park & Trail Fund, CIP Tree Fund, and the CIP Park &
Trail Grant Fund) have multiple projects which roll up into the overall fund balances, but remain designated
for use by project.
The CIP Park & Trail Fund receives annual funding from subventions, occasional Park-in-Lieu fees,
reimbursements and contributions, and transfers in from other funds. The Tree Fund receives revenue from
tree fines and transfers from other funds upon Council direction. The CIP Grant Fund receives federal, state,
local and occasional private grants which vary in source and amount from year-to-year. Typically, CIP Grant
Funds have a negative fund balance as project work is conducted beforehand and then reimbursed from
expenditure invoices.
Year end fund balance represents the remaining unexpended project funds (net of any negative CIP Grant
Fund Balance) which are subsequently re-appropriated by Council into the following budget year through
budget adoption.
Facility Improvement Funds
Facility Improvement Project Funds provide for capital maintenance and improvements of the City-owned
buildings and structures throughout the City. Each of the Facility Improvement Funds (CIP Facilities Fund
and the Facility Grant Fund) have multiple projects which roll up into the overall fund balances, but remain
designated for use by project.
The CIP Facilities Fund receives annual funding from a General Fund transfer, from Theater Ticket Surcharge
Fees, and from reimbursements and contributions. The Facility Grant Fund receives revenue from grants that
vary in amount from year-to-year. Typically, CIP Grant Funds have a negative fund balance as project work
is conducted beforehand and then reimbursed from expenditure invoices.
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Year end fund balance represents the remaining unexpended project funds (net of any negative CIP Grant
Fund Balance) which are subsequently re-appropriated by Council into the following budget year through
budget adoption.
Administrative & Technology Improvement Funds
Administrative & Technology Improvement Project Funds provide for major capital expenditures to improve
or enhance administrative, technology, and operational systems, processes, or functions. Each of the
Administrative & Technology Improvement Funds (CIP Admin & Tech Improvement Fund and the Admin
& Tech Grant Fund) have multiple projects which roll up into the overall fund balances, but remain designated
for use by individual project.
The CIP Administrative & Technology Improvement Fund typically receives funding from a General Fund
transfer as administrative and technology improvement focused grants are limited. If grants are received,
projects typically have a negative fund balance as project work is conducted beforehand and then reimbursed
from expenditure invoices.
Year end fund balance represents the remaining unexpended project funds (net of any negative CIP Grant
Fund Balance) which are subsequently re-appropriated by Council into the following budget year through
budget adoption.
INTERNAL SERVICE FUNDS – FUND BALANCE RESERVE POLICIES
Overview
Internal Service Funds are established to provide centralized cost centers for shared expenses and services in
order to efficiently track costs and manage resources. Costs are then allocated back to the operational
programs based on usage to more accurately determine cost of services.
The City’s Internal Service Funds include the two Insurance funds: Risk Management and Workers
Compensation, four Service/Support funds: Office Support, IT Services, Vehicle & Equipment Maintenance,
and Building Maintenance Funds, and two three Equipment Replacement funds: the Vehicle & Equipment
Replacement Fund, and the Office Technology Equipment Replacement Fund, and the Building FF&E
(Furniture, Fixture, & Equipment) Replacement Fund.
As each fund is accounted for as a separate entity, operational revenues less expenditures result in either a
positive or negative fund balance at any given point in time – Internal Service Funds are similar to the separate
checking and saving accounts a person may use for different purposes. At year end, each fund’s net balance
is represented as the “Fund Balance Reserve”. The intent of the Internal Service Funds Reserves is to hold
appropriate levels of reserves to support cash flow needs and minimize interfund loans, not to accumulate
funds in excess of expected ongoing operational costs. Reserve levels are determined by the specific
operational needs of the program, but typically will fall within 25 – 50% of annual budgeted expenditures.
Internal Service Funds are a type of Proprietary Fund; therefore GASB 54 fund balance classification (for
Governmental Fund types) does not apply. Instead, Internal Service Fund’s financial statement reports are
presented similar to private-sector businesses and use “Restricted” and “Unrestricted Net Position” to define
net operational balances (equity/fund balance reserves).
Unrestricted Net Position allows reserve funding to be used (with Council approval) within the general scope
of the fund’s purpose. Restricted Net Position reserves are limited to a specific use, narrower than the stated
purpose of the fund. For example, grant funding provided for a defined use, as in remaining funds from a
Risk Management Training Grant within the Liability/Risk Management Fund, must be used for qualified
training purposes. Most Internal Service Funds reserves are held in the Unrestricted Net Position category.
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Liability /Risk Management Reserve Fund
The Liability/Risk Management Fund’s Unrestricted Net Position reserve supports cash flow needs and
minimizes interfund loans. Appropriate levels are maintained through service chargebacks to the programs,
based on operational risk factors. Most claims are covered under the insurance risk pool JPA, the City is self-
insured for up to $25,000 per General Liability and City Vehicle Auto Liability occurrence, and up to $5,000
for Property Damage and 3rd Party Auto Liability. Non-covered claims are paid fully by the City.
The Liability/Risk Management program receives funding from allocations charged to covered departments,
from grant funding, and from claim reimbursements. At year end, unspent funding flows into Unrestricted
Net Position or Restricted Net Position for specific purposes. Requests for use of reserve balance are approved
by Council through budget adoption or by a Council approved budget adjustment resolution during the year.
The reserve is replenished from the Fund’s net operations in subsequent years.
Workers Compensation Fund
The Workers Compensation Fund’s Unrestricted Net Position reserve supports cash flow needs and minimizes
interfund loans. Appropriate levels are maintained through service chargebacks to the programs, based on
operational risk factors. The purpose of the Workers' Compensation program is to provide insurance benefit
coverage for employee work-related illness and/or injuries through its membership in a shared risk pool. The
risk pool provides coverage up to $250,000, and excess insurance provides coverage over this amount up to
$10 million.
The Workers Compensation program receives funding from allocations charged to covered departments, from
grant funding, and from claim reimbursements. At year end, unspent funding flows into Unrestricted Net
Position, or Restricted Net Position for grant funding. Requests for use of the reserve balance are approved
by Council through budget adoption or by a Council approved budget adjustment resolution during the year.
The reserve is replenished from the Fund’s net operations in subsequent years.
Office Support Fund
The Office Support program provides a centralized cost center for administrative office support expenses,
including photocopy machine leases, postage machines, various shared office machines, and the associated
maintenance and repair services, postage, paper, and copier supplies. For efficiency, office support costs are
managed collectively and charged back to departmental programs on a use-basis allocation. Accumulated net
operations are held in the Office Support Fund for working capital cash flow.
The reserve is funded from the allocations charged to covered departments. At year end, unspent funding
flows into Unrestricted Net Position. Requests for use of excess reserve balance are approved by Council
through budget adoption or by a Council approved budget adjustment resolution during the year. The reserve
is replenished from the Fund’s net operations in subsequent years.
Information Technology Services Fund
Information Technology Services provide for the delivery of technology based services throughout the City’s
operations, including maintenance of the City’s information systems and infrastructure, program
implementation, streaming video, internet, landline, and wireless communications systems, cloud based
technology, and support of all existing information technology as well as new technology initiatives. For
efficiency, information technology costs are managed collectively and charged back to departmental programs
on a service-based allocation to fund the program.
Funding for the program comes from these allocations charged to covered departments. At year end, unspent
funding flows into Unrestricted Net Position. Accumulated net operations are held in the Information
Technology Services Fund for working capital cash flow. Requests for use of the reserve are approved by
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Council through budget adoption or by a Council approved budget adjustment resolution during the year. The
reserve is replenished from the Fund’s net operations in subsequent years.
Vehicle & Equipment Maintenance Fund
The Vehicle & Equipment Maintenance program provides for the fuel, maintenance, and servicing of the
City’s fleet and major equipment to ensure all vehicles and equipment comply with manufacturer’s
recommendations and safety requirements.
To fund the program, vehicle & equipment replacement costs are charged back to the departmental programs
based on assigned usage. Accumulated net operations are held in the Vehicle & Equipment Maintenance
Fund for working capital cash flow. At year end, unspent funding flows into Unrestricted Net Position.
Requests for use of the reserve are approved by Council through budget adoption or by a Council approved
budget adjustment resolution during the year. The reserve is replenished from the Fund’s net operations in
subsequent years.
Building Maintenance Fund
The Building Maintenance program provides for the custodial, maintenance, and non-major repairs and
building improvement services for all facilities at the Civic Center, Prospect Center, and Museum Park.
Additionally, the program supports the maintenance and repair needs for the tenants of City leased buildings
as defined in the lease agreements. To fund the program, total costs are allocated back to departmental
programs primarily based on building space usage. General and public use is allocated to the Non-
Departmental program.
Accumulated net operations are held in the Building Maintenance Fund for working capital cash flow.
Funding comes from the allocations charged to covered departments. At year end, unspent funding flows into
Unrestricted Net Position. Requests for use of the reserve are approved by Council through budget adoption
or by establishing chargeback funding levels higher or lower than budgeted expenditures. The reserve is
replenished from the Fund’s net operations in subsequent years.
Vehicle & Equipment Replacement Reserve
The Vehicle and Equipment Replacement Fund Balance Reserve accounts for accumulated funding over an
asset’s lifespan, to be used for the replacement of the vehicle or equipment at the end of its useful life. Initial
purchases are paid for through a department’s operational budget. If the purchased item is for ongoing use,
the Vehicle & Equipment Replacement program appropriates an annual allocation for the replacement of the
vehicles and equipment based on the asset’s cost and years of life. Final determination for replacement of the
asset is determined through an analysis of whether the cost of maintenance equals or exceeds the cost of
replacing the asset.
The reserve is funded from allocations charged to covered departments and represents accumulated funding,
less amounts expended for asset replacement. At year end, unspent funding is held in Unrestricted Net
Position. The reserve is to be maintained at a level sufficient to provide replacement funding of vehicles and
equipment in accordance with replacement schedules.
Requests for use of the reserve are approved by Council through budget adoption or by a Council approved
budget adjustment resolution throughout the year. The reserve is replenished from the Fund’s net operations
in subsequent years.
Office Technology Equipment Replacement Fund
The Office Technology Equipment Replacement Fund accounts for accumulated funding over an asset’s
lifespan to be used for the replacement of office technology based equipment such as desktop computers and
monitors, laptops and tablets, network infrastructure, and various other related equipment. Replacement costs
are charged back to the departments based on assigned equipment costs. Initial purchases are paid for through
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a department’s operational budget. If the purchased item is for ongoing use, the Office Equipment
Replacement program appropriates an annual allocation for the replacement of the equipment based on the
asset’s cost and years of life.
The reserve represents accumulated funding, less amounts expended for replacements. The reserve shall be
funded to provide replacement funding in accordance with replacement schedules. Funding for the reserve
comes from the allocations charged to covered departments. Requests for use of the reserve are approved by
Council through budget adoption or by a Council approved budget adjustment resolution during the year. The
reserve is replenished from the Fund’s net operations in subsequent years.
Facility Furniture, Fixtures & Equipment (FFE) Replacement Fund
The Facility FF&E Fund accumulates funding over an asset’s lifespan to be used for the replacement of
furniture – such as tables, chairs, and cubicle partitions; for fixtures - such as kitchen appliances, sound
equipment, lighting, for equipment - such as HVAC units, boilers, and generators; and for facility
infrastructure – such as roof, door, window, and floor/carpeting replacement.
Initial purchases for new assets may be paid for through the Operating Budget or through the Capital Budget.
Annual replacement charges are charged-back to the supported department programs with full replacement
funding to be accumulated over the asset’s estimated lifetime. Final determination for replacement of the
asset is determined through an analysis of whether the cost of maintenance equals or exceeds the cost of
replacing the asset. The reserve is intended to be maintained at a level sufficient to provide replacement
funding in accordance with replacement schedules.
Requests for use of the accumulated reserve funding are approved by Council through budget adoption, or if
an unplanned situation occurs, by a Council approved budget adjustment resolution during the fiscal year.
The reserve is replenished by replacement charge allocations in subsequent years.
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CIP PROJECT PROCESS POLICY
This procedural policy defines how a project moves through the CIP Budget Funding process: from the initial
project idea, through project development, nomination, and project approval process, and if successful, into the
Capital Budget as a funded project.
The CIP project development stage of the policy takes different tracks, depending upon whether the project idea
is staff driven or Council nominated. These two paths are discussed separately below, until the tracks converge
for CIP project assessment preparation.
STAFF PROJECT DEVELOPMENT
1. CIP Project Initiation
As a function of staff’s day-to-day work, infrastructure improvements and large-scale repairs and
maintenance are identified as potential capital improvement projects. These are often highly-visible tangible
public assets such as street repaving, or park and trail improvements. However, many CIP projects are less
noticeable, including facility roof repairs, tree planting, or ADA enhancements. Projects may also be
administrative or technology improvements, and hence invisible to the general public, such a s code
updates/revisions, process improvements, software implementations, or economic vitality programs.
Staff is to discuss the CIP project idea with the appropriate staff or City Manager for feedback and
refinement. Ultimately, projects need clearly defined boundaries to identify project requirements,
specifications, and resources. While this is not always feasible in the initial stages of project development,
the understanding that a project will eventually require a clear and specific scope will encourage better
preparation for discussing the project idea and moving it through the nomination process. After receiving
initial approval, staff moves into the idea development stage.
2. Idea Development
To move the idea forward, staff will need to analyze and articulate the project’s scope, political impacts,
priority factors, resource requirements, and any other relevant considerations.
a. Project Scope – Scope may include the description, project size and location parameters, project
purpose, and goals or deliverables, such as products, services or results. Project justifications and
assumptions should support the project’s purpose and definition, and may include cost-benefit analysis,
risk assessments, funding availability, or even community desirability factors.
The scope should clearly state if a project is to be funded and/or completed in phases rather than as a
singular body of work. If the project is ongoing infrastructure maintenance or a program project, this
too should also be clearly noted. In some cases, project scope may be defined by exclusions – statements
about what the project will not accomplish or produce. Additionally, constraints or restrictions may
identify project limitations.
Project Scope defines a commitment to produce a body of work or end-product with the resources
provided under the stated assumptions. The written scope helps to manage expectations and provide
clarity to the involved parties, reduce confusion and failure, prevent scope creep, and provide
transparency to the community.
b. Political Considerations - Knowledge of historical information, which attests to the necessity of
Council/staff communication is of vital importance in project development. Determine whether this
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project has come up for consideration before, or why was it not completed previously. Are there lessons
to be learned from a past project proposal?
Another consideration includes knowing whether a project might be controversial. Is there a segment
of the community strongly opposed to, or strongly supportive of this specific project? Will this project
prompt demand for further funding or resources? Have similar projects been completed in another part
of the city? Determine why this project should be considered a priority over others, and whether the
project’s cost or benefits would be supported by the community.
c. Priority Factors - Project priority is an important consideration in the CIP approval decision factor.
Council’s role is to determine which projects are of higher priority than others since there will never be
enough money or resources to do every project. Decision criteria may include factors such as:
Health and Safety Issues
Imminent failure of structure/system
Short-term cost of repair vs. long-term cost of replacement
Availability of external or dedicated funding
Federal or State mandates
Business or community support
Impacts if project is not completed
A project’s priority is also affected by the severity of the criteria. For instance, a project that falls under
the “Imminent Failure of Structure/System” criteria may be an extremely dangerous situation in need
of immediate repair, or low danger of minor importance and simply remedied by removal. Another
example would occur with Federal or State mandated projects. There may be little impact as to whether
the mandate is met, or there may be severe fines for lack of timely completion. As a result, project
priority is based on the overall assessment of the circumstances; many factors contribute to priority
decisions and Council cannot rely upon a clear hierarchical order upon which to base their decisions.
d. Project Resources - In the City’s project development discussions, resources typically refer to financial
funding. However, resources may also refer to staff time, equipment and materials,
community/stakeholder participation or support, space requirements, information technology services,
or some other type of support or contribution.
Funding plays a critical role in project development. In many cases, lower priority projects may be
approved ahead of higher priority projects simply because there is designated funding available for the
lower priority projects. The ability to bring designated funding (such as a grant award) with a project
proposal greatly increases the likelihood that the proposed project is approved. Overall, projects that
request undesignated Capital Project Reserve funding are more competitive due to funding limitations
and the number of projects competing for the same pot of funds.
An additional component of project resource considerations are the unstated resources (identified above)
required in project construction or implementation. For instance, staff time is limited and time spent
working on one project prevents staff time being spent on another project. Project timing and staff time
requirements are therefore an important component of the project that Council may wish to review.
e. Other Considerations - There are numerous other factors not mentioned above that are also taken into
consideration when assessing a project idea. For example, can the City afford the ongoing operating
budget increases to maintain or implement the project? Does the project contribute toward economic
vitality? Are there environmental concerns? Does it enhance the community’s art, education, or cultural
resources? Does the project provide operational efficiencies or cost savings? Are there risk
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management or legal liability issues? Does this project require development be staged in phases? Is
there strong community interest in this project? Each project will differ, meaning analysis is specific to
the circumstances, and diligent research and thought should be put into developing project scope and
justification.
In summary, the overall goal of idea development is to identify, quantify, and assess the project
comprehensively. This effort is intended to ensure that a proposed project is well-thought-out,
developed, and articulated thereby enabling the City Manager and Council to make educated and
rational decisions.
3. City Manager Approval
Staff is to propose the project idea to the City Manager for approval. If approved, the project is moved onto
the CIP Project Candidate List. Staff is to notify the Administrative Services Director of the project’s
approval and provide pertinent project information.
Staff will prepare written narratives with project scope, justification, fiscal impacts, cost estimates, timelines,
etc. as necessary for Council Retreat assessment package.
City Council Project Development
Council Members are often the recipients of residents’ suggestions for capital project work. Depending on
the topic, Council Members can take these opportunities to: 1) educate the residents on why a project may
not be feasible; or 2) provide residents with information on how to contact City staff with their requests to
determine feasibility; or 3) Council may support the project suggestion and decide to act as a proponent for
the project by guiding it through the Capital Project Nomination process:
1. Nomination - To move a project idea onto the CIP Candidate List, a Council Member is to propose the idea
to fellow Council Members at the end of a City Council Meeting during the Council Items session and
request that it be put on the CIP Candidate List for review during the next upcoming CIP budget cycle.
2. Idea Concurrence - A second Council Member must concur with the request to move the project idea onto
the Capital Project Candidate List.
3. Follow-up - A nomination to the Capital Project Candidate List is to be recorded in the City Council minutes,
and acted upon as a follow-up item for staff to complete Candidate List step requirements. Staff will prepare
written narratives with project scope, justification, fiscal impacts, cost estimates, timelines, etc. as necessary
for Council Retreat assessment package.
CIP Project Assessment
1. Assessment Package
In preparation for the annual Capital Project Assessment, Finance will consolidate the CIP Project
Candidates, along with proposed changes to current CIP projects, and the current year’s CIP Unfunded
Project List into an assessment package for Council’s review. The Capital Project Assessment review
provides a forum to assess all projects at one time. These assessment package will include:
A review of available funding
Existing projects in the current year’s CIP
Proposed changes to existing projects
The current CIP Unfunded List
Proposed changes to projects on the CIP Unfunded List
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New projects on the CIP Candidate List
Review of requests in conjunction with funding sources
2. Council Retreat
The Capital Project Assessment is to be held annually, prior to the start of the budget development cycle,
typically at the Council Retreat Meeting that occurs in late January or early February. During the assessment
review, Council will review available funding and all project requests.
In their review, Council may request revisions to a project’s scope, funding, or other component. However,
changes that redefine a proposed project must be Council’s consensus direction. As projects are assessed,
they are either:
Rejected
Accepted, or
Modified and Accepted
At the conclusion of the assessment review, Council will prioritize accepted projects and designate project
funding. Projects placed on the Funded List will be brought forward to the upcoming Budget Study Session.
The remainder will be placed on the CIP Unfunded Project List.
NOTE: Rejected project ideas may be nominated for another attempt to become an approved project in the
following year(s), but must again go through the project development and assessment process.
3. Budget Study Session
Updated CIP funding availability and project revisions will be reviewed a final time with Council. Council
will conduct a final assessment and provide consensus direction to staff for inclusion in the upcoming
Proposed Budget Hearing to be held in May.
CIP Project Funding
1. Proposed Budget Hearing
The final Proposed Capital Budget with the recommended project funding will be brought to the City
Council Budget Public Hearing in May for final review. New funded projects will be presented, along with
summary level budget information. Council is to provide any final comments or direction for budget
adoption.
2. Budget Adoption
The Operating and Capital Budgets are brought to Council in June with all final direction incorporated into
the final summaries. Council is to adopt the budget at this time, with budget funding effective on July 1st of
that year.
Funding Process Follow-up
Approved CIP projects that do not receive funding allocations will be assigned to the next budget year’s CIP
Unfunded List. The list will be included in the budget document, and assessed again during the following
year’s Capital Project Nomination and Assessment Process.
The new CIP Unfunded List has a life span of one budget cycle.
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