2010051712 Desk Item - OPERATING AND CAPITAL BUDGETS,~pW N OF
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~~3"Gp'ip5 COUNCIL AGENDA REPORT
DATE: MAY 17, 2010
MEETING DATE: 5/17/10
ITEM NO: 12
DESK ITEM
TO: MAYOR AND TOWN COUNCIL
FROM: GREG CARSON, TOWN MANAG
SUBJECT: OPERATING AND CAPITAL BUDGETS
The purpose of this desk item is to share responses to Council Member questions related to the proposed
FY 2010/11 Operating and Capital budgets. '
Almond Grove
A question was asked as to why only design work for Almond Grove is included in the FY 2010/11
Capital Budget. The Council has. adopted reconstruction of the Almond Grove street system as a two-
year Town priority, During next fiscal year, decisions will be made as to the tuning and type of
reconstruction (e.g., asphalt vs. concrete) as well as the funding required to actually do the work. Please
note that developer-paid traffic mitigation funds are restricted to capacity enhancing projects and cannot
be applied to residential street projects such as Almond Grove. Further, our existing street improvement
projects are typically allocated to other higher priority collector, arterial and neighborhood projects.
Nonetheless, other sources of potential funding, including the sale of Town-owned assets, will be
considered during the next year as a potential funding source for this Council-established priority.
Management Information S. stems MIS)
A question was asked about moderate increases to printer costs in the MIS program. Funds for the
potential replacement of a Parks .and Public Works (PPW) sign shop plotter and Community
Development map plotter have been included in the operating budget as part of the printer replacement
program. MIS will reevaluate the condition of the plotters later in the fiscal year and determine if
replacement is necessary. In addition, another inquiry was made about the $200,000 MIS expenditure
for fixed assets/special projects. This funding is linked to the implementation of key projects in the
Information Technology Master Plan, and to new opportunities to incorporate technology that enhances
PREPARED BY: JENNY HARUYAMA
FTiVANCE/BUDGET MANAGER
N:\MGR\AdminworkFiles\2010 Council Reports\5-17-10 Budget Desk Item.doc
Reviewed by: Assistant Town Manager Town Attorney
Clerk Administrator Finance Community Development
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MAYOR AND TOWN COUNCIL/CHAIR & MEMBERS OF THE RDA
SUBJECT: FY 2010/11 OPERATING AND CAPITAL BUDGETS
MAY 17, 2010
productivity and customer service. Previous projects funded from this source include document
management, the new phone system, and wireless video downloading for police. The transition fiom
Novell to Microsoft Exchange will also be funded by this source.
Property Tax Revenue
A question was asked about 4% property tax growth as indicated on page C-14. This increase in
property tax revenue reflects a comparison between the original adopted FY 2009/10 budget and the
proposed FY 2010/11 budget, as is the standard. budget presentation. However, when including the $2,2
m SERAF payment received by the Town with the FY 2009/10 estimated property tax revenue, the
actual projected growth in property tax revenue is slightly below 1 %. This presentation adjustment will
be made as part of the final published budget document.
Library Services
Questions asked about the library are outlined below:
.Trust Funds - A question was asked about the use of the Library McClendon and Ness Trust funds. The
fund balances have been fully appropriated to allow flexibility in addressing various needs related to the
new library, including both future collections and services as well as contributions to the Friends
fundraising campaign for Furniture, Fixtures and Equipment (FFE).
Library Hours - A question was asked about the savings generated as a result of reducing total library
hours from 54 to 50 a week. Attached is a schedule showing current, proposed and alternative library
hours for next year. The reduction in hours was proposed not only for -cost savings, but also to
standardize operating hours consistent with those most used by the community and to attain operational
efficiency associated with staffing "single shift" days. In addition, the rapidly rising utilization of
library online services supplements access to library services available when the library is open. The
change to ~50 hours leaves Los Gatos in the middle of library service hours provided throughout the
County.
Library Consolidation - A question was asked about the proposed consolidation study related to library
services. The retirement of the Library Director, the opening of the new Library, and fiscal realities
make this an optimum time to consider full or partial consolidation of the Town library with County or
other~service providers.
Library Transition -The $7,500 recommended as a grant to the Friends of the Library would cover the
retired Library Director for up to 4 hours per week for 6 months at her current hourly rate. The Friends
would be required to fund any increased compensation or hours of service as well as payroll and
supervision.
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MAYOR AND TOWN COUNCIL/CHAIR & MEMBERS OF THE RDA
SUBJECT: FY 2010/11 OPERATING AND CAPITAL BUDGETS
MAY 17, 2010
Use of North 40 Specific Plan Project Developer Fees
A question was asked about the use of fees collected as a result of processing the North 40 Specific Plan
to fitnd portions of staff positions through a pass through account. The State Enabling Act grants local
agencies the ability to charge fees for processing land use applications. Pursuant to Government Code
section 66014 et seq., when a local agency charges fees for zoning changes, subdivision maps, or
planning services, etc., "those fees shall not exceed the estimated reasonable cost of providing the
service for which the fee is charged." Accordingly, the Town of Los Gatos operates under a cost
recovery model for Community Development Department services and application processing. The
more common or routine fees that the Department assesses are based on a fee for service study that is
completed approximately every five years. These fees are listed in the Town's Comprehensive Fee
Schedule. However, there are fees for services that are not included in the Comprehensive Fee Schedule
because the applications are uncommon, infrequent, generally snore complex and less predictable in
terms of the staff time involved, overall processing time, and materials. In these cases, the
Comprehensive Fee Schedule states that the Community Development Director has the ability to require
an applicant establish a deposit with the Town and actual staff time and materials is assessed against the
deposit or as the Finance Department terms a "pass through account." The -fee schedule notes that
"request for services not covered by any other fee" will be billed as the "actual cost." All staff time and
materials are tracked and billed to the pass through account and any remaining balance at the completion
of the project is refunded to the applicant.
The fee schedule does not have a fee for a specific plan and development agreement .since the Town
does not regularly process these types of applications. The North 40 applicant will require a specific
plan, EIR, Development Agreement, numerous Architectural and Site applications, multiple subdivision
maps, etc., and will take approximately 18 to 24 months to process the initial phases of the development.
In FY10/11, staff estimates that this will require a minimum of a .75 .Senior Plamier's available time
(approximately 1,560 hours), .OS Community Development Director's time (104 hours), and .25 to .50
Engineering staff time (520 to 1,040 hours). Parks and Public Worlcs will address this additional work
by retaining a part time engineer who is paid through the pass through account. Based on the
Department's cost recovery model, the North 40 applicant would be required to snake the initial deposit
into the pass through account based on the projected staff hours associated with the processing of the
application.
In conclusion, this is coimnon practice used in Community Development Departments for large and
complex development applications. This model ensures that the general public is not responsible for
funding the processing of the application through taxes.
Public Communication
The Town Council also received today the attached letter from Mr. Philip Brouwer of Accent On Rugs.
In response, please note that the Town has eliminated a total of 16 staff positions over the past 4 years,
including 7 from last year to this year and 8 proposed from this year to next year, for a total reduction of
over 9%, with the greatest reductions in Community Services and Community Development (see
attached summary). In addition, limits on overtime and furloughs have reduced staff compensation, and
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MAYOR AND TOWN COUNCIL/CHAIR & MEMBERS OF THE RDA
SUBJECT: FY 2010/11 OPERATING AND CAPITAL BUDGETS
MAY 17, 2010
management has not received a cost of living increase for 3 years. Last, all non-management positions
are subject to civil service protections and contracts, including seniority rights and progressive
performance discipline.
Library Construction Project
Due to the timing of the construction bid process and bond sale, staff will incorporate into the June 7
action item any further changes required to fully implement the library project, including Pageant Park
and reconfiguration ofthe existing library space.
Attachments
1. Los Gatos Library Hours
2. Letter from Philip Brower, dated May 14, 2010
3. Five-Year Staffing Summary
Los Gatos Library Hours
Open 7 2009/10 201 0/11
Da s/Week CURRENT PROPOSED ALTERNATIVE
Monday 10a-8p 11 a-8p 11 a-8p
Tuesday 10a-8p 11 a-8p 11 a-8p
Wednesday 12 n- 8 p 10 a- 6 p 10 a- 6 p
Thursday. 12n-8p 10a-6p 10a-6p
Friday 10a-5p 10a-6p 10a-6p
Saturday 10a-5p 1 p-5p 10a-6p.
Sunday 1 p-5p 1 p-5p 1 p-5p
TOTAL 54 hours 50 hours 54 hours
Additional
Funding
Required
$90 k
N A.
$40 k
ATTACHMENT 1
of Los Ga[os
10 Station Way • Los Gatos, CA 95030 • ~408J 354-8820
5/14/1 O
Town Council
Town of Los Gatos
Dear Council
. i
MAY 1 '~l 2010
MAYOR ~ TOWN COUNCIL
I am writing to object to the plan to not layoff any staff members, as reported
in the Los Gatos Weekly on 5/14. Government workers cannot be considered
immune to economic woes.
Please insist that the manager weed out the dead wood. I can assure you that
there are .staff members who are not needed and superfluous, There are for
sure a couple inspectors who are flat out useless and incompetent. I speak
from personal experience as well as knowledge of past history of botched
inspections such as the New Old Town building and the mistakes made there
due to incompetent inspectors. 1 have no doubt that there is a percentage of
staff members who will not be missed.
1 am disappointed in council's decision to allow the town to increase the fees
instead of reducing staff. If you insisted on the same kind of efficiencies
necessary for the private sector, layoffs would of course be on the agenda.
Public service entitlement is the United States major domestic crisis. These
entitlements are not sustainable. Please take a lead from the private sector
and eliminate some staff.
No doubt a quality staff member is invaluable and necessary. But the notion
that government workers are immune from evaluation and elimination if they
are under performing is simply unacceptable.
Sincerely
~~-'~-
Philip Brouwer
ATTACHMENT 2
FIVE YEAR STAFFING SUMMARY
Town of Los Gatos
DEPART1VIlJN'I'S 2006/07 2007/08 2008/09 2009/10 2010/11 CHANGE
Administration and Management 29.0 28.7 28.2 24.6 24.3
Temp Hours converted to FTE's 0.2 0.3 0.8 0.9 1.2
Administration Sub-total 29.2 29.0 28.9 -25.4 25.5 12.6%
Community Development 18.6 18.6 18.6 17.6 15.6
Temp Hours converted to FTE's 0.0 0.1 0.0 0.0 0.0
Community Development Sub-total 18.6 18.7 18.6 17.6 15.6 16.1%
Police 62.0 61.0 61',0 60.0 59.5
Temp Hours converted to FTE's 1.3 1,8 1.8 1.4 1.4
Police Sub-total 63.3 b2.8 62.8 61.4 60.9 3,7%
Parks & Public Worlcs 34.0 34.0 37.0 35.0 32.5
Temp Hours converted to FTE's 5.2 4.2 2.5 3.3 3.6
Parks & Public Worlcs Sub-total 39.2 38.2 39.5 38.3 36.1 8,p%
Community Services 4.3 5.3 5.3 5.3 3.3
Temp Hours converted to FTE's 1.2 0,2 0.2 0.2 0.1
Community Services Sub-total 5.5 5.5 5.5 5.5 3.4 38.2%
Library 10.4 10.4 10.4 10.4 8.6
Temp Hours converted to FTE's 5.3 4.9 4.9 4.9 5.4
Library Sub-total 15.6 15.2 15.2 15.2 14.0 10.G%
ALL DEPARTMENTS 1.58.2 157.9 160.4 152.8 143.8
Tem ~ Hours converted to FTE's 13.2 11.4 10.1 10.6 11.7
TOTAL 171.3 169.3 170.4 163.4 155.4 9.3%
ATTACHMENT 3