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CITY OF PETALUMA, CALIFORNIA
AGENDA BILL July 3,
Agenda Title:
Meeting Date:
July 3, 2006
Resolution Adopting FY 2006-2007 Gann Appropriations Limit
Meeting Time: ❑ 3:00 PM
® 7:00 PM
Category (check one): N Consent Calendar ❑ Public Hearing ❑ New Business
❑ Unfinished Business ❑ Presentation
Department:
Director:
Contact Person:
Phone Number:
Administrative Services
Steve Qrmichael
Steven Carmichael
778-4323
Cost of Proposal: /
Account Number:
N/A
N/A
Amount Budgeted:
Name of Fund:
N/A
N/A
Attachments to Agenda Packet Item:
1. Resolution Adopting Gann Appropriations Limit and Malting Annual Elections
2. Appropriations Limit Calculations — Worksheets
3. California State Department of Finance Price (Per Capita Income) and Population Computations and
Information
Summary Statement:
Under the provision of California State Law the City is required to set an Annual Appropriations Limit,
which is commonly referred to as the "Gann Limit." This Appropriations Limit is based on appropriations
that are originating from "Proceeds of Taxes" as defined by law. This appropriations limit amount is
adjusted each year by the application of annual adjustment factors, which include adjustments for
population growth and per capita income changes. These adjustment factors are provided by the California
State Department of Finance (Attachment #3). The City of Petaluma makes an annual election to choose
the adjustment factors as provided by the State. The Appropriations Limit for Fiscal Year 2006-2007 has
been calculated by using the increase in the per -capita income and population growth factors as provided.
The Fiscal Year 2006-2007 Appropriations Limit is calculated to be $100,121,284. This limit
increased by 4.30% or $4,130,547 from the Fiscal Year 2005-2006 limit of $95,990,737. The Fiscal Year
2006-2007 Appropriations that are subject to the limit (Proceeds of Taxes) are calculated to be
$27,393,777.
Recommended City Council Action/Suggested Motion:
Adopt the resolution setting the Gann Appropriations Limit and Making the Election to use the
Calculations Factors as provided by the California State Department of Finance.
Reviewed by Administrative
Reviewed by City Attorney:
Approved bv City Manager:
Date:
r
Services Director: Date: �4 � (I
k
Date:
—
Today's Date:
Revision # and Date Revised:
—
File Code:
#
June 5, 2006
11.
4. FINANCIAL IMPACTS:
The Appropriations Limit has never been a factor in considering the City's annual budget. Currently,
the City is spending $72,727,507 less than the appropriations limit of $100,121,284. The total FY
2006-2007 appropriations subject to the limit are $27,393,777 (Proceeds of Taxes). Obviously, this
limit will not affect the continued operations of the City currently, or for many years into the future.
5. CONCLUSION:
As in past years, the Appropriations limit has become less of a concern for the City of Petaluma, as the
City's expenditures subject to the "Gann Limit" do not come close to what the limit would allow.
Unless there are drastic changes in the way municipal finance is structured, the appropriations limit will
continue to be a mathematical calculation and not a financial planning tool.
6. OUTCOMES OR PERFORMANCE MEASUREMENTS THAT WILL IDENTIFY SUCCESS OR COMPLETION'
The adopted resolution and worksheets will become part of the Fiscal Year 2006-2007 Adopted Budget
Document.
RECOMMENDATION:
Adopt the resolution establishing the Appropriations Limit of $100,121,284 for Fiscal Year 2006-2007.
sJbudgel/budget 05/agenda/gann agenda bill
2
Attachment #1
RESOLUTION ADOPTING THE APPROPRIATIONS LIMIT FOR FISCAL YEAR 2006-2007
AND MAKING THE ANNUAL ELECTION FOR ADJUSTMENT FACTORS
WHEREAS, the people of California on November 6, 1979, added Article XIII-B to the California State
Constitution placing various limitations on the Appropriations of State and Local Governments; and
WHEREAS, the California State Legislature adopted Chapters 1205 and 1342 of the 1980 Statutes which
implemented Article XIII-B; and
WHEREAS, the people of California on June 5, 1990 amended Article XIII-B effective on July 1, 1990; and
WHEREAS, the provisions of the amendments have been interpreted by a coalition of statewide organizations,
and the organizations have issued through the League of California Cities revised guideline to calculate the
Appropriations Limit; and
WHEREAS, section 7910 of the Government Code requires cities to adopt a resolution setting the annual
appropriations limit at a regularly scheduled meeting or a noticed special meeting; and
WHEREAS, the City of Petaluma has complied with the provisions of Article XIII-B in calculation the
appropriations limit for Fiscal Year 2006-2007;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma that:
1. The Fiscal Year 2006-2007 Appropriations Limit shall be $100,121,284
2. The Fiscal Year 2006-2007 Appropriations subject to the Limit is $27,393,777
3. The annual election for Adjustment Factors shall be to use the growth in City Population and the
increase in the Per -Capita Personal Income for the State of California, as provided by the California
State Department of Finance
3
CITY OF PETALUMA, CA
APPROPRIATIONS LIMITS CALCULATION
FY2006-2007 ADOPTED BUDGET
APPROPRIATIONS LIMIT
A. Last Year's Limit- June 30, 2006
B. Adjustment Factors
1. Growth in City of Petaluma population
2. Growth in California Per Capita Income
Total Adjustment %
C. Annual Adjustment $
D. Other Adjustments
Lost Responsibility (-)
Transfer to Private (-)
Transfer to Fees (-)
Assumed Responsibility (+)
SubTotal
E. Total Adjustments
F. This Year's Limit - June 30, 2007
Amount Source
$ 95,990,737 Adopted Budget
1.0033
State Finance
1.0396
State Finance
1.0430
( B1 * B2 )
4,130,547
( B-A)
4,130,547 (C+D )
$ 100,121,284 (A+E)
N
CITY OF PETALUMA, CA
APPROPRIATIONS LIMIT ANALYSIS
FISCAL YEAR 2006-2007
APPROPRIATIONS LIMIT ANALYSIS
Last Year's Appropriations Limit
Adjustment Factors
Change in Per Capita Personal Income
City Population Increase January 2005 to January 2006
Total Adjustment Factor
This Year's Appropriations Limit
Proceeds of Taxes 27,393,777
Exclusion
This Year's Appropriations Subject to Limit
This Year's Appropriations Under Limit
$ 95,990,737
1.0396
1.0033
1.0430
$ 100,121,284
27,393,777
$ 72,727,507
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