pages: CityCouncil/2015-06-02.pdf, 3
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CityCouncil | 2015-06-02 | 3 | Mayor Spencer inquired whether the annual operating results for the coming year is $1.2 million positive, but $5.2 million deficit after five years. The Finance Director responded the City has been prudent in forecasting moving forward; stated; deficits are attributed to increases in retirement contributions that cannot be easily changed; the City is working with bargaining groups on long term solutions for Other Post Employment Benefits (OPEB); structural deficit issues have to be reviewed and corrected; anytime budget forecasts go further out in years, it is best to assume where the economy will go based on what is known now; staff is doing its best to estimate; the budget is conservative and there are a multitude of items that need to be addressed. Councilmember Ezzy Ashcraft stated one-time large transfer funds are referenced; inquired what the plan is moving forward. The Interim City Manager responded a portion of the transfer tax is one-time; eliminating the transfer tax from the Balance Revenue Index (BRI) was discussed and needs to be negotiated with bargaining units. Vice Mayor Matarrese inquired whether one-time fund transfers have been used to balance revenue in budget, to which the Interim City Manager responded in the affirmative. Vice Mayor Matarrese stated there are no other outstanding loans; solutions for fixing structural problems needs discussion; budgeting is not exact and projections are variable; the City has the benefit of history to make projections tighter; that he would like checkpoints after the first year to address the gap. The Finance Director stated the loan repayment from Alameda Municipal Power (AMP) is $2.2 million; there was a swap of revenue: AMP prepaid a portion of its franchise with an advance, which is already in the General Fund; AMP will repay the $2.2 million in full in FY15-16 instead of trying to eliminate it; the net increase one-time money is $1.2 million added to the fund balance in FY15-16; Council agreed to use the fund balance toward FY16-17. The Interim City Manager stated staff met with an attorney who specializes in utility users tax to determine an estimate of what is being left on the table; the five year projections show the need to continue belt tightening; continuing to be frugal and making adjustments would help fiscal sustainability. Councilmember Daysog stated the chart is helpful; when comparing annual expenditure increases to conservative revenue estimates, the annual rate of change almost doubles; staff is being conservative; the chart shows the structural deficit in summary form; he questioned what happened to the programs being considered to decrease fund balance from 30% to 20%. Special Joint Meeting Alameda City Council and the Successor Agency to the Community Improvement Commission June 2, 2015 | CityCouncil/2015-06-02.pdf |