FISCAL YEAR 2012/13 OPERATING BUDGETt ru�..auk
�oS:GA�os COUNCIL AGENDA REPORT
MEETING DATE: 6/04/12
ITEM NO: .�
DATE: MAY 25, 2012
TO: MAYOR AND TOWN COUNCIL
FROM: GREG LARSON, TOWN MANAGER ' Aew 00 ��
SUBJECT: ADOPT A RESOLUTION APPROVING THE TOWN OF LOS GATOS
FISCAL YEAR 2012/13 OPERATING BUDGET AND FY 2012/13 — FY
2017/18 CAPITAL IMPROVEMENT PROGRAM (CIP), CARRY FORWARD
APPROPRIATIONS, AND OTHER APPROVED ADJUSTMENTS AND
MINOR CORRECTIONS
RECOMMENDATION
Adopt resolution approving the FY 2012/13 Operating and Capital Summary Budget and the FY
2012/13 — FY 2017/18 Capital Improvement Program (CIP) for the Town of Los Gatos, directing
staff to incorporate within the final adopted budget any changes related to Council approved
meet and confer process or management compensation plan amendments, classification
adjustments or minor corrections, carry - forward appropriations, changes due to more refined
estimates and grant approvals, or additional Town Council direction received by staff upon
adoption of the budget.
BACKGROUND
On May 21, 2012, a public hearing was held to discuss the Proposed FY 2012/13 Town
Operating and Capital Summary Budget and Proposed FY 2012/13 — FY 2017/18 Capital
Improvement Program (CIP). The Town Council considered both documents and directed staff
to bring back the documents for final approval. Any additional changes or corrections directed
by Council upon adoption of the budget can be incorporated into the final authorized budget
provided for in the attached resolution (Attachment 1).
DISCUSSION:
The attached resolution incorporates the following actions directed by the Council at the May 21,
2012 budget hearing.
PREPARED BY : YARUYAMA
Assistant Fina,4 Director /Budget Manager
C: \Users\lseastrom \Desktop \Dept TC Repotts \Council Staff Repotts \Budget \FY 2012 -13 \TC Repott.Operating and Capital Budgets 6- 4- 12.docx
Reviewed by Assistant Town Manager Town Attorney Finance
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MAYOR AND MEMBERS OF THE TOWN COUNCIL
SUBJECT: ADOPT RESOLUTION APPROVING THE FY 2012/13 OPERATING AND
CAPITAL BUDGETS
May 25, 2012
Expanded Library Weekend Hours As part of the FY 2011/12 budget, Council approved the use
of budget reserves to fiend the provision of three additional hours on Saturday mornings (from
10:00 am - 1:00 pm) until the end of the current fiscal year. At the May 21, 2012 FY 2012/13
budget hearing, Council authorized the extension of library hours Saturday morning (10:00 am —
1:00 pm) and Sunday (12:00 pm — 1:00 pm). The anticipated annual cost of this extension is
$65,000.
Arts Funding Request The proposed FY 2012/13 budget reflects a status quo grant fiunding
allocation of approximately $8,000 for arts organizations. The Arts and Culture Commission
recommended that the $4,000 grant to the Arts Docents be decreased to $2,000 and all remaining
grants be eliminated. The $6,000 balance would then be allocated to fund the Arts Plan.
However, the Arts Plan is also eligible for $9,800 in Art Cat donation fitnds, which would be
sufficient for projects such as the footbridge mural and /or new public art. As part of the FY
2012/13 budget, Council maintained the previous funding levels for arts organizations and
authorized the use of the Art Cat donation funds for public art projects to be proposed by the
Commission.
Non - Profit Funding In prior years, Live Oak Adult Day Services received CDBG grants
through the Town. Santa Clara County will now be administering these fiinds directly and is
limiting CDBG grants to homeless and housing projects and applicable ADA projects. Given
that the Town is in the middle of its two -year community grant fitnding cycle, Live Oak is not
able to apply for fielding. As part of the FY 2012/13 budget, Council directed staff to include
approximately $12,988 in community grant funding for this non - profit.
Senior Case Management Services In FY 2011/12, the Town's senior services program was
transferred to Los Gatos - Saratoga Recreation (LGS). One area that LGS was not obligated to
provide was case management for seniors, which was previously provided by Town staff.
Recognizing the importance of this valuable service, Council authorized up to $7,000 in fttnding
for targeted senior case management services as part of the FY 2012/13 budget.
Use of Fund Balance or Other Revenues. The proposed operating budget incorporates reductions
in staffing and other expenses, and revenue enhancements totaling approximately $1.8 million to
balance the FY 2012/13 budget. Included in this amount is approximately $500,000 in current
year fund balance resulting from conservative revenue projections and /or reduced expenditures.
In lieu of using fund balance, Council also considered using other expected revenue including
one -time proceeds from the dissolution of the Redevelopment Agency or one -time residual
receipts from the private sale and purchase of the Villa Vasona affordable senior apartments.
Both revenue sources are estimated to be up to $750,000 each. Council authorized the use of
fiend balance to balance the FY 2012/13 operating budget.
PAGE 3
MAYOR AND MEMBERS OF THE TOWN COUNCIL
SUBJECT: ADOPT RESOLUTION APPROVING THE FY 2012/13 OPERATING AND
CAPITAL BUDGETS
May 25, 2012
Planning and Building Fee Changes At the May 21, 2012 budget hearing, Council was provided
with a summary of proposed fee adjustments to better capture the cost of providing various
planning and building services. This proposal included fee increases averaging 10 %, with a
small number of selected services which are currently being performed significantly below full
cost recovery recommended for up to a 30% increase. A modification of building fees was also
recommended by staff, transitioning permit valuations from the International Conference of
Building Officials (ICBO) Building Standards to the International Code Council (ICC), a
standard widely adopted by cities in the region. With the adoption of a new standard which
better reflects current construction costs, staff anticipated an increase to most building permit
fees averaging between 10 % -12 %. Council directed staff to bring forward the fee proposals and
an alternate proposal related to residential -based planning and building fees in response to
Council comments. Council will consider the proposed amendments to the FY 2012/13 Fee
Schedule at a public hearing on June 4, 2012.
FISCAL IMPACT:
The fiscal impact of the Town Operating and Capital Budgets is provided in the Financial
Summaries section of the budget document including estimates of Fund Reserves at June 30,
2013. Staff will bring forward applicable budget adjustments as part of the Town's mid -year
budget review, including expected revenue from the RDA Dissolution and sale and private sale
and purchase of the Villa Vasona property. Other anticipated adjustments include additional
revenue from the West Valley Solid Waste JPA which will be used for the Town's Street
Sweeping program.
Attachments:
Attaclmlent 1: Resolution of the Town Council Approving FY 2012/13 Operating Budget and
FY 2012/13 — FY 2017/18 Capital Improvement Program (CIP)
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RESOLUTION 2011 -XXX
RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS
APPROVING THE FY 2012/13 OPERATING BUDGETAND FY 2012/13 — FY 2017/18 CAPITAL
BUDGET AND CARRY - FORWARD APPROPRIATIONS AND OTHER APPROVED
ADJUSTMENTS RELATED TO ANY BARGAINING GROUP, CONFIDENTIAL EMPLOYEE,
OR MANAGEMENT COMPENSATION PLANS, CLASSIFICATION ADJUSTMENTS, MINOR
CORRECTIONS, AND REFINED ESTIMATES
WHEREAS, Section 2.30.295(b) of the Los Gatos Town Code requires the Town Manager
to annually prepare and submit a budget to the Town Council and be responsible for its administration;
and
WHEREAS, the Town Manager submitted a proposed budget for the FY 2012/13 to the
Town Council; and
WHEREAS, the Town Manager submitted a proposed five -year capital improvement plan
for FY 2012/13 — FY 2017/18; and
WHEREAS, the Town Council has considered and reviewed said proposed budget and
capital improvement plan during public hearings.
RESOLVED, that the Town Council hereby adopts as the budget for the Town of Los
Gatos for the 2012/13 fiscal year the schedule entitled "Total Town Revenues By Fund and Total Town
Expenditures By Fund (Exhibit A) including the first year (FY 2012/13) of the Town's Capital
Improvement Program budget as contained in the Town's FY's 2012/13 — 2017/18 Capital Improvement
Plan,
BE IT FURTHER RESOLVED, that the final adopted budget includes approved carry-
forward appropriations for unspent operating grants and pass- throughs from FY 2011/12, and that there
be carried forward from prior years Reserve for Encumbrances within each fund an amount sufficient to
cover approved outstanding encumbrances as of June 30, 2012;
RESOLVED, Town Council authorizes the Town Manager to increase temporary staffing
or to convert temporary positions to regular positions as needed to meet rising workloads with associated
fee and permit revenues at no net increase to the General Fund. Any such increases or conversions will
require prior notice to the Council; and
ATTACHMENT 1
BE IT FURTHER RESOLVED, that the Town Council hereby directs staff that any
changes or impacts resulting from: Council approval of any bargaining group, confidential employee, or
management compensation plans; from classification adjustments or miscellaneous corrections; from
changes due to more refined estimates or grant approvals; or from further Town Council consensus
direction received on June 4, 2012, be incorporated within the final FY 2012/13 Operating and Capital
Budget.
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los
Gatos, California, held on the 4 t1i day of June, 2012 by the following vote:
COUNCIL MEMBERS:
AYES:
NAYS:
ABSENT:
ABSTAIN:
SIGNED
MAYOR OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
ATTEST:
CLERK OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
ATTACHMENT 1
N:' SFIARC ' 2011 -12 \201 1 -XXX TC Approving FY 11-12 Operating Budget, CIP.doc
TOTAL TOWN REVENUES BY FUND AND TOTAL TO`VN EXPENDITURES BY FUND
2012 /13 Estimated 2012/13
Proposed Budget Recommended
Budget Revision Budget
TOWN REVE NUES & OTHER FUNDING SOURCES
General Fund $ 32,789,997 $ 32,789,997
Special Revenue Funds 820,456 820,456
Internal Service Funds 4,430,837 4,430,837
Trust & Agency Funds 162,149 162,149
Capital Project Funds (does not include caryforwards) 4,412,965 4,412,965
Successor Agnecy Funds 6,361,313 6,361,313
TOTAL TOWN REVENUES & OTHER FUNDING SOURCES $ 48,977,717 $ - $ 48,977,717
TOTAL TOWN EXPENDITURES, TRANSFERS OUT & CARRYFORWARD APPROPRIATION
General Fund $ 35,174,291 $ 84,988 $ 35,259,279
Special Revenue Funds 646,832 646,832
Internal SetviceFunds 5,792,218 5,792,218
Trust & Agency Funds 378,788 378,788
Capital Project Funds (does not include carryforwards) 6,071,274 6,071,274
Successor Agnecy Funds 6,362,503 6,362,503
TOTAL TOWN EXPENDITURE& OTHER FUNDING US FS $ 54,425,906 $ 84,988 $ 54,510,894
TOTAL SOURCE(US E) OF FUND BALANCES $ (5,448,189) $ (84,988) $ (5,533,177)
EXHIBIT A
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