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Attachment 4 - Revenues and Expenditures Assumptions FORECAST ASSUMPTIONS REVENUE BASELINE AND PROJECTION FACTORS Type of Revenue Base Line Estimate FY 2022/23 Budget FY 2023/24 Forecast FY 2024/25 Forecast FY 2025/26 Forecast FY 2026/27 Forecast FY 2027/28 Forecast Property Tax/VLF Backfill SCC Assessor Office January 2022 report. 3% 3% 3% 3% 3% 3% North 40 Property Sales Starting in FY 2021/22 North 40 Sales 3% 3% 3% 3% 3% ERAF SCC Assessor Office March 2022 report SCCA recommend 70% of FY 2021/22 anticipated proceeds $400K $400K $400K $400K $400K Sales Tax MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates Sales Tax - Measure G MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates MuniServices 3/16/2022 Most Likely Estimates Franchise Fee Current baseline set by FY 2021/22 Year End Estimates Current baseline set by FY 2021/22 Year End Estimates 3% 3% 3% 3% 3% Transient Occupancy Tax Current baseline set by FY 2021/22 Year End Estimates Current baseline set by FY 2021/22 Year End Estimates 5% 5% 3% 3% 3% ATTACHMENT 4 FORECAST ASSUMPTIONS REVENUE BASELINE AND PROJECTION FACTORS Type of Revenue Base Line Estimates FY 2022/23 Budget FY 2023/24 Forecast FY 2024/25 Forecast FY 2025/26 Forecast FY 2026/27 Forecast FY 2027/28 Forecast Business License Tax Current baseline set by FY 2021/22 Year End Estimates 3% 3% 3% 0% 0% 0% License & Permits Current baseline set by FY 2021/22 Year End Estimates 3% 3% 3% 3% 3% 3% Town Services Current baseline set by FY 2021/22 Year End Estimates 3% 3% 0% 3% 3% 3% Fine & Forfeitures Current baseline set by FY 2021/22 Year End Estimates 3% Varies Varies Varies Varies Varies Interest Current baseline set by FY 2021/22 Year End Estimates Varies based on portfolio Varies based on portfolio Varies based on portfolio Varies based on portfolio Varies based on portfolio Varies based on portfolio Other Sources Current baseline set by FY 2021/22 Year End Estimates Varies Varies Varies Varies Varies Varies FORECAST ASSUMPTIONS EXPENDITURE BASELINE AND PROJECTION FACTORS Beginning in FY 2020/21, the Town is budgeting salaries at the actual salary plus a one-step increase. 68% of the workforce is already at top step or one step below top step. In the Five-Year Forecast, positions are forecasted at the actual rate of pay including salaries and benefits as of April 1, 2022 and rate is increasing in the actual anniversary date. *Salary increases are based on actual step increases and approved Memoranda of Understanding with the bargaining units. **Benefit increase estimates are provided by CalPERS/Public Employees’ Medical and Hospital Care Act (PEMHCA). ***Based on historical trends. The Town’s required employer contribution rate estimates were developed using data provided by each plan’s most recent CalPERS actuarial valuation. The employer contribution rates reflect percentages of covered payroll. Rates shown for FY 2022/23 are actual rates as prescribed by CalPERS. Forecasted rates for FY 2023/24 and subsequent years are based on the most recent CalPERS actuarial valuation reports and staff assumptions regarding staff’s current estimate of returns for FY 2021/22 which are presently expected to below the 6.8% discount rate. Type of Expenditure FY 2022/23 Budget FY 2023/24 Forecast FY 2024/25 Forecast FY 2025/26 Forecast FY 2026/27 Forecast FY 2027/28 Forecast Salaries* 2% 2% 2% 2% 2% 2% Benefit - Medical** 7% 7% 7% 7% 7% 7% Operating Expenditures*** Varies 3% 3% 3% 3% 3% Grants & Awards 0% 0% 0% 0% 0% 0% Utilities*** Varies 3% 3% 3% 3% 3% Internal Service Charges*** Based on operating cost and scheduled replacement Based on operating cost and scheduled replacement Based on operating cost and scheduled replacement Based on operating cost and scheduled replacement Based on operating cost and scheduled replacement Based on operating cost and scheduled replacement Debt Service Debt Service Schedules FORECAST ASSUMPTIONS Beginning in FY 2021/22, the estimates of employer contributions were credited with an anticipated reductions associated with the approximate $4.8 million additional discretionary payment (ADP) toward the 2016 unfunded amortization base paid off in October 2019 and the total of approximately $5.8 million in ADPs toward unfunded 2013 and 2015 amortization bases that were paid off in FY 2020/21. Employer contribution rate projections also include small percentage increases reflecting the anticipation of CalPERS gradually lowering its discount rate over the Five-Year Forecast period in accordance with the CalPERS adopted risk mitigation strategy, and the lowering of the discount rate to the present rate of 6.8% as of 6/30/2022. Estimates were also informed by recent rate estimates developed by the Town’s actuary using the most recent actuarial valuation updated with current year projections of covered payrolls by plan type. Type of Expenditure FY 2022/23 Budget FY 2023/24 Forecast FY 2024/25 Forecast FY 2025/26 Forecast FY 2026/27 Forecast FY 2027/28 Forecast Safety POA 69.44% 72.01% 74.61% 75.68% 76.69% 76.66% Safety Management POA 72.44% 75.01% 77.61% 78.68% 79.69% 79.66% Safety POA - PEPRA 14.62% 14.65% 13.78% 13.75% 13.76% 13.76% Miscellaneous TEA/Confidential/ Management 29.92% 30.04% 30.64% 28.45% 28.73% 28.42% Miscellaneous TEA/Confidential/ Management PEPRA Separate PEPRA rate for Miscellaneous has not been established yet by CalPERS. 29.92% 30.04% 30.64% 28.45% 28.73% 28.42% *Safety Classic Rate reflects 3% decrease in employer's contribution rate to reflect 3% contribution as negotiated with the Town's POA during the collective bargaining process effective FY 2019/20.