Loading...
HomeMy WebLinkAboutStaff Report 2.C 07/20/2009CITY OF PETALUMA, CALIFORNIA AGENDA BILL Agenda Title: Resolution Adopting FY 2009-2010 Gann Appropriations Limit 2.0 Meetine Date: July 20 2009 Meetima Time: 7:00 PM Category: ❑ Presentation ❑ Appointments ® Consent ❑ Public Hearing ❑ Unfinished Business ❑ New Business Department: Director: Finance Tamera Haas Total Cost of Proposal or Proiect: N/A Amount Budeeted: N/A Contact Person: Phone Number: Site Shmilo 1 778-4322 Name of Fund: Various Account Number: Various Current Fund Balance: Recommendation: It is recommended that the City Council take the following action: Adopt the resolution setting the Gann Appropriations Limit and Malting the Election to use the Calculations Factors as provided by the California State Department of Finance. L ❑ First reading of Ordinance approved unanimously, or with unanimous vote to allow posting prior to second reading 2. ❑ First reading of Ordinance approved without unanimous vote: Ordinance has been published/posted prior to second reading; see Attachment 3. © Other action requiring special notice: The information required by Government Code Section 7910 was made available to the public on June 23, 2009. 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 "Galin 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 2009-2010 has been calculated by using the increase in the per -capita income and population growth factors as provided. The Fiscal Year 2009-2010 Appropriations Limit is calculated to be $112,863,464. This limit increased by 2% or $1,773,019 from the Fiscal Year 2008-2009 limit of $111,090,445. Tile Fiscal Year 2009-2010 Appropriations that are subject to the limit (Proceeds of Taxes) are calculated to be $28,764,125. Attachments to Aeenda Packet Item: 1. Resolution Adopting Gann Appropriations Limit and Making Amoral Elections 2. Appropriations Limit Calculations — Worksheets 3. California State Department of Finance Price (Per Capita Income) and Population Computations and Information Reviewed b Finance Director: Reviewed by City Attornev: Approved Ilv City Manaeer: bbwvxd� Date: Date: < Date:(/'/ CJ�J Rev. # I hAi4L _ I Date Last Revised: 6-23-09 File: s:/budget/budaetlll/agenda/l;ann 10 CITY OF PETALUMA, CALIFORNIA JULY 20, 2009 AGENDA REPORT FOR Resolution Adopting FY 2009-2010 Gann Appropriations Limit RECOMMENDATION: Adopt the resolution establishing the Appropriations Limit of $112,863,464 for Fiscal Year 2009-2010. BACKGROUND: In November 1979, the people of California added Article XIII -B to the California State Constitution, which placed limitations on the Appropriations of State and Local Governments. The Article defined the process to calculate the appropriations limit and require Cities to adopt resolutions setting the annual appropriations limits. In June 1990, the people adopted Proposition 111 that amended Article XIII -B. The amendment created the new base year of FY 1986-1987, and allowed annual increases based on factors comprised of the change in population combined with either the change in California per -capita personal income or the change in the local assessment roll due to local non-residential construction. It also provided for the exclusion of capital expenditures over $100,000 and required independent auditor review of the calculations. Guidelines were developed to define and implement the changes and to establish the annual review requirements. The City of Petaluma has complied with all applicable laws and regulations regarding the Appropriation Limit requirements including Auditor reviews. The City of Petaluma's Appropriations Limit has increased significantly since 1987 by applying the allowable factors as outlined above. In the current Fiscal Year, the City is using the change in per - capita personal income and population growth as the factors to adjust the appropriations limit, as provided by the California State Department of Finance. The change in per -capita income was .62% combined with the change in population, .97 % -- resulted in a factor calculated to be 2% increase. This increase adjusted the appropriations limit upward from $111,090,445 in FY 2008-2009 to Sl 12,863,464 for Fiscal Year 2009-2010. As required by California State law, detailed worksheets have been provided showing the appropriations limit calculations. These worksheets are included with this report and are available for public review and inspection at the City Clerk's office. 3. DISCUSSION: Under the provisions of California State law, the City is required to set an Annual Appropriations Limit commonly referred to as the "Gann Limit". The limit amount may be adjusted each year by the application of annual adjustment factors of "Per Capita Income" and "Population" changes as provided by the California State Department of Finance. (See Attachment #3.) The City of Petaluma makes an annual election to choose the adjustment factors as provided by the Cali fornia State Department of Finance. The Limit for Fiscal Year 2009-2010 been calculated by using the increase in the per -capita income (statewide) and the City's population growth factors. The Fiscal Year 2009-2010 Appropriations Limit is calculated to be $112,863,464. This limit increased by 2% or $1,773,019 from the Fiscal Year 2008-2009 limit of $111,090,445. The Fiscal Year 2009- 2010 Appropriations that are subject to the limit (Proceeds of Taxes) are calculated to be $28,764,125. N 4. FINANCIAL IMPACTS: The Appropriations Limit has never been a factor in considering the City's annual budget. Currently, the City is spending $84,099,339 less than the appropriations limit of 5112,863,464. The total FY 2009-2010 appropriations subject to the limit are $28,764,125 (Proceeds of Taxes). 3 Attachment #1 RESOLUTION ADOPTING THE APPROPRIATIONS LIMIT FOR FISCAL YEAR 2009-2010 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 2009-2010; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma that: 1. The Fiscal Year 2009-2010 Appropriations Limit shall be $112,863,464 2. The Fiscal Year 2009-2010 Appropriations subject to the Limit is $28,764,125 3. The amoral 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. 4 P -a, ".a -cq, CITY OF PETALUMA, CA APPROPRIATIONS LIMITS CALCULATION FY2009-2010 ADOPTED BUDGET APPROPRIATIONS LIMIT Amount Source A. Last Year's Limit - June 30, 2009 $ 111,090,445 Adopted Budget B. Adjustment Factors 1. Growth in City of Petaluma population 1.0097 State Finance 2. Growth in California Per Capita Income 1.0062 State Finance Total Adjustment % 1.0160 (81 -B2) C. Annual Adjustment S 1.773.019 ( B -A) D. Other Adjustments Lost Responsibility (-) Transfer to Private (-) Transfer to Fees (-) Assumed Responsibility (+) SubTotal E. Total Adjustments 1,773,019 ( C+D ) F. This Year's Limit - June 30, 2010 $ 112.863.464 ( A+E) CITY OF PETALUMA, CA APPROPRIATIONS LIMIT ANALYSIS FISCAL YEAR 2009-2010 APPROPRIATIONS LIMIT ANALYSIS Last Year's Appropriations Limit $ 111,090,445 Adjustment Factors Change in Per Capita Personal Income 1.0062 City Population Increase January 2008 to January 2009 1.0097 Total Adjustment Factor 1.0160 This Year's Appropriations Limit $ 112,863,464 Proceeds of Taxes 28,764,125 Exclusion This Year's Appropriations Subject to Limit 28,764,125 This Year's Appropriations Under Limit $ 84,099,339 CITY OF PETALUMA, CA APPROPRIATIONS LIMIT ANALYSIS FISCAL YEAR 2009-2010 Revenue Summary Proceds Non -Proceeds of of Taxes Taxes Exemptions Total TAXES 22,716,000 0 0 22,716,000 STATE 5,752,400 60,000 0 5,812,400 OTHER GOVERNMENTS 0 7,168,000 0 7,168,000 LOCALLY RAISED 0 5,432,050 0 5,432,050 USER FEES 0 5,808,650 0 5,808,650 OTHER MISCELLANEOUS AND INTERFUND TRANSFERS 0 705,200 2,132,900 2,838,100 INTEREST INCOME 295,725 199,175 0 494,900 Total 28,764,125 19,373,075 2,132,900 50,270,100 nENT DF T �Wi a "�" z w IIII n n � t. DEPARTMENT OF CS G,FO0.N�P F I ,\ A N C C May 2009 Dear Fiscal Officer: Subject: Price and Population Information A-�1--a�1� �•e�t�- 3 ARNOED SCHWARZENEGGER, GOVERNOR 915 L STREET 0 SACRAMCNTO CAM USS 1--3i06 ® WWW.00,CA.nov Appropriations Limit The California Revenue and Taxation Code, Section 2227, mandates the Department of Finance (Finance) to transmit an estimate of the percentage change in population to local governments. Each local jurisdiction must use their percentage change in population factor for January 1, 2009, in conjunction with a change in the cost of living, or price factor, to calculate their appropriations limit for fiscal year 2009-2010. Enclosure I provides the change in California's per capita personal income and an example for utilizing the price factor and population percentage change factor to calculate the 2009-2010 appropriations limit. Enclosure II provides city and unincorporated county population percentage changes, and Enclosure IIA provides county and incorporated areas summed population percentage changes. The population percentage change data excludes federal and state institutionalized populations and military populations. Population Percent Change for Special Districts Some special districts must establish an annual appropriations limit. Consult the Revenue and Taxation Code, Section 2228, for further information regarding the appropriation limit. You can access the Code from the following website:"htto://www.leainfo.ca.cov/calaw html" check box: "Revenue and Taxation Code' and enter 2228 for the search term to learn more about the various population change factors available to special districts to calculate their appropriations limit. Article XIII B, Section 9(C), of the State Constitution exempts certain special districts from the appropriations limit calculation mandate. Consult the following website: "http://www.leginfo,ca.gov/.consU.article_13B" for additional information. Special districts required by law to calculate their appropriations limit must present the calculation as part of their annual audit. Any questions special districts have on this issue should be referred to their respective county for clarification, or to their legal representation, or to the law itself. No state agency reviews the local appropriations limits. Population Certification The population certification program applies only to cities and counties. Revenue and Taxation Code Section 11005.6 mandates Finance to automatically certify any population estimate that exceeds the current certified population with the State Controller's Office Finance will certify the higher estimate to the State Controller by June 1, 2009 Please Note: Prior year's city population estimates may be revised. If you have any questions regarding this data, please contact the Demographic Research Unit at(916)323-4086. MICHAEL C. GENEST Director By: ANAJ.MATOSANTOS Chief Deputy Director Enclosure Fiscal Year 2009-2010 May 2009 Enclosure I A. Price Factor: Article XIII B specifies that local jurisdictions select their cost -of -living factor to compute their appropriation limit by a vote of their governing body. The cost -of -living factor provided here is per capita personal income. If the percentage change in per capita personal income is selected, the percentage change to be used in setting the 2009-2010 appropriation limit is: Per Capita Personal Income Fiscal Year Percentage change (FY) over prior year 2009-2010 0.62 Following is an example using sample population change and the change in California per capita personal income as growth factors in computing a 2009-2010 appropriation limit. 2009-2010: Per Capita Cost of Living Change = 0.62 percent Population Change = 1.11 percent Per Capita Cost of Living converted to a ratio: Population converted to a ratio. Calculation of factor for FY 2009-2010- 2 0.62 + 100 = 1.0062 100 1.11 + 100 = 1.0111 100 1.0062 x 1.0111 = 1.0174 l Fiscal Year 2009-2010 Enclosure II Annual Percent Change in Population Minus Exclusions January 1, 2008 to January 1, 2009 and Total Population, January 1, 2009 Total County Percent Chance --- Population Minus Exclusions -- Population City 2006-2009 '1-1-08 1.1-09 1-1-2009 Sonoma Cloverdale 0.63 8,541 8,595 8,595 Cotati 0.37 7,382 7,409 7,409 Healdsburg 1.08 11,656 11,782 11,782 Petaluma 0.97 57,187 57,739 57,739 Rohnert Park 0.33 42,879 43,020 43,020 Santa Rosa 1.37 159,317 161,496 161,496 Sebastopol 0.70 7,680 7,734 7,734 Sonoma 0.70 9,901 9,970 9,970 Windsor 0.87 26,445 26,676 26,676 Unincorporated 062 149,907 150,836 152,209 County Total 0.91 480,895 485,257 486,630 (') Exclusions include residents on federal military installations and group quarters residents in state mental institutions, state and federal correctional mstlotions and veteran homes 3 l�