Attachment 1D
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TOWN OF LOS GATOS
CIVIC CENTER
110 E. MAIN STREET
LOS GATOS, CA 95030
May 6, 2016
Honorable Mayor and Town Council:
I am pleased to present to you a balanced Fiscal Year (FY) 2016/17 Proposed Operating Budget for the
Town of Los Gatos. The budget for FY 2016/17 reflects a total Town budget of $72.3 million, an
increase of $17.6 million or 32% when compared to the FY 2015/16 budget. The Town’s proposed total
General Fund expenditures are $46.9 million, an increase of $9 million or 23% when compared to the FY
2015/16 budget. This increase is the result of a significantly larger apportionment of General Fund
capital transfers to other funds for capital projects. The General Fund revenues are budgeted at $35.5
million (excluding debt payments and fund transfers in), a 1% increase over FY 2015/16 budgeted
revenues.
FY 2016/17 FISCAL OUTLOOK
Overview
The workload and budgetary prioritization process took into account the Town’s current and long term
fiscal picture, as well as high priority service delivery needs. Key principles include:
Develop and recommend a balanced budget that maintains service levels;
Continue to make progress on Strategic Priorities identified by the Town Council; and
Identify opportunities to enhance service delivery through technology and open government.
As shown in the chart below, the Proposed Budget is largely funded by the General Fund (64.9%).
General Fund
The General Fund pays for core services such as public safety, community development, parks and public
works, library, and other services. The revenue used to pay for these services comes primarily from local
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taxes such as property tax, sales tax, transient occupancy tax, franchise fees, licenses and permits, Town
services, fines and forfeitures and a variety of other sources. As illustrated in the chart below, the
majority of General Fund revenue supports funding for Police, Parks and Public Works, Community
Development, and Library.
General Fund revenue is estimated at $35.6 million in the FY 2016/17 Proposed Budget, excluding debt
service and fund transfers in). This is an increase of $0.5 million (1%) when compared to the FY
2015/16 Adopted Budget. While increased Property Tax accounts for the majority of the increase in
revenue, Vehicle License Fee (VLF) backfill property tax, Transient Occupancy Tax, and Business
License Tax have also increased. Sales Tax revenue is projected to decrease over the prior year.
The Town’s General Fund operating budget expenditures for FY 2016/17 have decreased by $322,940 or
1.4% compared to the prior year’s adopted budget (excluding fund transfers and debt service). These
expenditures are comprised of six major categories of costs, including salaries and benefits, grants and
awards, internal service charges, operating expenses for supplies and services, and debt service. The
delivery of Town services is highly dependent on labor, which makes up 50.2% of budgeted General
Fund expenditures for FY 2016/17.
Internal Service Funds
Internal Service Funds are used for areas where goods or services are provided to other City departments.
Internal Service Funds include funds and programs for Management Information Systems, Liability
Insurance, Workers Compensation, Building Maintenance, Equipment Replacement and Vehicle
Maintenance.
The total Townwide proposed expenditures for Internal Service charges are $3,644,534, which is $48,659
or 1.4% higher than budgeted FY 2015/16 amounts. This increase is primarily attributed to the purchase
of several pieces of replacement equipment.
Capital Projects Fund
The Capital Improvement Projects Fund is typically used to account for financial resources that are used
for the acquisition or construction of major capital infrastructure or to provide or improve facilities for
Town Departments, and are identified in the five-year Capital Improvement Program (CIP).
The proposed FY 2016/17 Townwide expenditures from the Capital Projects Funds is $15 million
(excluding transfers out) which is inclusive of $9.9 million in General Fund Appropriated Reserves for
the Town’s CIP program.
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Special Revenue Funds
Special Revenue Funds are a fund type used to account for the proceeds of specific revenue sources that
are legally restricted to expenditures for specific purposes. Special Revenue Funds account for 0.9% of
the Town-wide expenditure budget. The Town’s largest Special Revenue Fund is the Urban Run-Off
Source Fund at approximately $530,000. The Total proposed Budget for Special Revenue Funds for FY
2016/17 is $360,000, a decrease of approximately $50,000 from FY 2015/16 Adopted Budget.
Trust & Agency Funds
Trust and Agency funds are used to account for assets held by the Town as a trustee agent for individuals,
private organizations and other governments. The Town’s Trust and Agency Funds are a comprised of
four trusts established to provide for the servicing of donations and bequests to the Town’s Library
program. The FY 2015/16 budgeted expenditures in this trust fund total $67,000.
Successor Agency to the Los Gatos RDA Funds
The Successor Agency to the Los Gatos Redevelopment Agency (RDA) private-purpose trust fund
accounts for the assets, liabilities and operations transferred from the dissolution of the Town’s RDA,
including Certificates of Participation issued to finance several capital improvement projects throughout
the Town and repayment of obligations incurred by the Town’s RDA prior to its dissolution. The FY
2016/17 budgeted expenditures in this trust fund total $3.9 million.
General Fund Reserves
The total General Fund Reserves are forecasted at a balance of approximately $18.8 million as of June 30,
2017. As indicated in the chart below. the General Fund reserves are decreasing as is to be expected due
to the Town’s California Public Employees Retirement System (CalPERS) side-fund payoff in June 2014
of $4.5 million dollars and the transfer to the CIP program of $9.9 million in FY 2016/17.
Adopted Council policy specifies Catastrophic and Budget Stabilization reserves totaling 25% of General
Fund ongoing operating expenditures (12.5% each), or $8.8 million total for FY 2016/17
Fund Balance Reserves
6/30/2012
Actuals
6/30/2013
Actuals
6/30/2014
Actuals
6/30/2015
Actuals
6/30/2016
Estimated
6/30/2017
Proposed
Catastrophic & Budget Stabilization 10,900,000$ 10,900,000$ 10,800,000$ 10,800,000$ 8,779,822$ 8,779,822$
Capital / Special Projects 7,265,004 12,427,161 10,218,579 9,511,527 5,841,527 4,441,527
Post Retirement Medical 400,000 400,000 400,000 400,000 - -
Vasona Land Sale 1,645,329 410,599 411,245 - - -
Special Studies 490,000 490,000 490,000 490,000 237,000 237,000
Almond Grove Reserve - - - - 8,459,973 -
Other 2,787,479 1,349,294 859,294 901,837 4,601,303 5,368,467
Total General Fund Reserves 23,487,812$ 25,977,054$ 23,179,118$ 22,103,364$ 27,919,625$ 18,826,816$
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Catastrophic & Budget Stabilization Reserve
As per the Town’s reserve policy, the Catastrophic and Budget Stabilization Reserves are to be
maintained at combined minimum funding level of 25% of General Fund ongoing operating expenditures.
The funding requirement is equally divided between the Catastrophic Reserve (12.5%) and the Budget
Stabilization Reserve (12.5%). Fund balance in these reserves is used to fund future fluctuations in the
economy, mitigating the cyclical changes in locally generated revenues from temporary downturns in the
local economy.
Capital / Special Projects
With Council direction, upon the close of the fiscal year, the Capital projects reserve receives the Town's
annual revenues above operating expenditures after funding all legally restricted reserves at their required
levels. Fund balance is assigned for the acquisition and construction of capital facilities.
Post-Retirement Medical
Assigned fund balance in this reserve will be used to aid in funding actuarially determined requirements
for retiree medical costs.
Special Studies
Assigned fund balance in this reserve has been identified the Town’s contribution towards a school traffic
Study, contingent on school district participation, as well as one-time affordable housing.
Almond Grove Reserve
A reserve for Almond Grove Street Rehabilitation project was established in October 2015.
Other
The Town has several other smaller reserves that have been classified as other. These reserves include an
open space reserve which may be used to make selective open space acquisitions, a productivity reserve
which will be used to fund projects that will streamline and improve existing services and other
unappropriated reserves.
Strategic Goals and Priorities
In September 2015, the Town Council determined the Strategic Priorities for 2015-2017, providing
guidance to Town staff on workload prioritization. The Town Council reaffirmed its Core Goals,
including: Community Character, Good Governance, Fiscal Stability, Quality Public Infrastructure, Civic
Enrichment, and Public Safety.
Key Budget Assumptions
Revenues
The FY 2015/16 Budget assumes healthy economic growth, with the General Fund revenues (excluding
debt payments and fund transfers in) expecting to increase by 1% to $35.5 million. Revenue projections
for each category were based upon estimates provided to the Town by Santa Clara County, the Town’s
sales tax consultant and careful examination of revenue trends and patterns. The economy remains
positive which has resulted in staff proposing an increase in operating revenues of $0.5 million. This is
mostly due to forecasted increases in revenues such as Property Tax, Vehicle License Fee (VLF) backfill
property tax, Transient Occupancy Tax and Licenses and Permits. Sales Tax revenue is projected to
decrease slightly over the prior year.
Property Tax receipts in Los Gatos are expected to increase over the budgeted FY 2015/16 receipts.
Property Tax budget projections are based on projections by the Santa Clara County Assessor’s Office.
Transient Occupancy Tax (TOT) has also increased. Licenses and Permits are expected to increase just
slightly as the large scale building projects are fewer in number.
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Staffing
The FY 2016/17 Operating Budget has 157.72 budgeted FTEs, including temporary staff. This reflects a
decrease of 0.58 FTE compared to the prior year. The recommended FY 2016/17 staffing levels reflect
the following changes from the prior year’s adjusted budget:
Administrative Services and Town Offices – Staffing reallocations occurred between the
Administrative Services, Town Offices, and Library programs; however total FTEs between the
programs decreased. The budget also reflects Council action in October 2015 to reinstate a full-
time Assistant Town Manager position and the reclassification of the Administrative Technician
position to Administrative Analyst position to align the job class more closely to the works as
assigned. In addition, a 0.63 FTE Office Assistant positon was increased to a 1.0 FTE position to
provide administrative support to the Human Resources, Town Attorney and Management
Information Systems Departments.
Police –The FY 2016/17 budget includes an operational restructure and reorganization of non-
sworn positions which best meets the demands within the Department. The reorganization
resulted in a reclassification of a 1.0 FTE Records Specialist within Property and Evidence
Investigation Program, reduction of temporary hours for Communication Dispatcher and addition
of a 1.0 FTE Communications Dispatcher within the Records and Communication Program. Due
to the workload, expertise required, and additional duties of managing Property and Evidence, the
Department has recognized the need to reclassify the 1.0 FTE Property and Evidence Records
Specialist back to its previous classification as a Community Service Officer, this 1.0 FTE
Community Service Officer will be funded from Investigations. In addition, the Records and
Evidence Manager has been reclassified to a Police Records Manager. This restructure allowed
for improved alignment around departmental effectiveness and vision. These modifications were
made without fiscal impact. The part-time Community Services Officer will be eliminated from
the Community Development and Police Departments’ budgets due to lack of nighttime
complaints. In addition to the operational reorganization, temporary staff funding is proposed to
the FY 2016/17 budget for technology support, background investigations, and parking control
officers. The temporary hour increase is funded from one-time funding. Staff anticipates bringing
forward an ongoing funding source for this temporary hour increase at the FY 2016/17 mid-year
review for Council consideration, after the completion of the bargaining unit agreements and
other fiscal decisions.
Community Development Department (CDD) – Budgeted salary and benefit expenditures reflect
the addition of a 0.125 FTE one-time funding for an Associate Planner position. Staff anticipates
bringing forward an ongoing funding source for this FTE increase at the FY 2016/17 mid-year
review. The part-time Community Services Officer will be eliminated due to lack of nighttime
complaints. The budget also reflects Council action in October 2015 to reinstate a full-time
Community Development Director position
Parks & Public Works (PPW) – The Parks and Public Works budget reflects a status quo budget
no changes in FTEs and a small reduction in temporary hours.
Library - The FY 2016/17 Library budget increased moderately to reflect the new Library
Management Team structure. Additionally, some temporary hours have been converted into
permanent positions to increase stability in staffing and continuity in service delivery. The
temporary Senior Page hours were converted to 1.0 FTE Senior Library Page for better oversight
and efficiency of the check-in and shelving functions at the Library.
Salary Increases and Elimination of Furloughs – Salary adjustments (if any) for FY 2016/17 are
not finalized at this time, as this is a matter of collective bargaining with the Town’s three
employee unions. The Town’s three bargaining units are: Association of Federal, State, County
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and Municipal Employees (AFSCME), Town Employees’ Association (TEA) and Los Gatos
Police Officers’ Association (LGPOA).
Non-Personnel Operating Expenditures
Non-Personnel expenditure budgets were developed based on actual expenditures in prior years, adjusted
for FY 2016/17 funding needs. In light of limited available resources, the FY 2016/17 Proposed Budgeted
non-personnel expenditures are conservative, with additions primarily limited to non-discretionary,
contractually obligated, or mandated increases.
Unfunded Mandates and Special Projects
The FY 2016/17 Proposed Budget includes funding to address two unfunded mandates, one for storm
water pollution prevention and the second for traffic signage maintenance. Storm water requirements
include defined improvements towards monitoring and preventing pollution of the storm drains, including
inspecting and cleaning of storm drains, and installing and maintaining filters to prevent pollution. In
addition, the federal government has mandated reflectivity levels for signs with prioritization of speed
limit and stop signs. It is expected that within a two to three year period, all traffic signs will be affected.
Both of these mandates require the Town to increase service levels in these areas to meet existing
regulations. Non-compliance could result in fines and liabilities. Funding for these mandates is proposed
as a one-time, $40,000 addition to the FY 2016/17 budget which will continue to address these
requirements. It is expected that these mandates will increase over time requiring additional allocation of
funds to maintain compliance.
In addition, a new law took effect January 1, 2015 that allows eligible employees who did not previously
qualify for sick leave benefits (seasonal, temporary/hourly employees) to start accruing sick leave starting
July 1, 2015. This is an on-going expenditure for the Town that is included in the FY 2016/17 budget.
Five-Year Financial Plan
Serving as a foundation of the budget planning process, the Town updates the Five-Year Financial Plan
beginning in the fall of each year. The plan includes updates to Town revenues and expenditures with the
first year of the forecast’s revenue estimates being the most critical in the process, as that will ultimately
define the expenditure limitations for the forthcoming budget year. The multi-year conservative revenue
projections further refine the Town’s planning for current and future expenditures based on future
projections. The preliminary assumptions are used to forecast the Town’s fiscal capacity and provide the
financial framework within which the proposed Department service levels must be developed. They also
serve as the basis to test the potential impacts of proposed policy and operational modifications based
upon the Town’s most recently adopted Strategic Priorities.
Indicative of the continued improvement in the local economy, the Five-Year forecast provided some
limited opportunities to fund non-discretionary increases related to various costs such as contractually
obligated increases and unavoidable increases in certain employee benefit costs such as pension and
health care. The forecast does not include increases in salary and/or benefits which may result from
updated Memoranda of Understanding with the Town’s bargaining units. Funds were allocated to meet
unfunded state and federal mandates such as storm water pollution prevention, reflective signage, and
personnel safety training. Funding was also available for continuance of one-time staffing needs in
critical service areas such as planning support in Community Development and information technology
needs in the Police Department. Other areas of emphasis included one-time funds available for the
continued expansion of the downtown garbage and recycling service and an one-time increase in the
youth and adult library collections budget.
Provided below is a recap of the most recent Five-Year Financial Plan prepared in early May 2016. The
updated Five-Year Financial Plan spans FY 2016/17 – 2020/2021:
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FY 1 FY 2 FY 3 FY 4 FY 5
Account Revenue Category
2015/16
Estimated
2016/17
Forecast
2017/18
Forecast
2018/19
Forecast
2019/20
Forecast
2020/21
Forecast
4100 Property Tax 10.1$ 10.5$ 10.8$ 11.1$ 11.4$ 11.8$
4110 VLF Backfill Property Tax 3.0 3.0 3.0 3.1 3.1 3.1
4200 Sales & Use Tax 8.1 8.2 8.2 8.5 8.8 9.1
4250 Franchise Fees 2.1 2.2 2.3 2.3 2.4 2.5
4251 Transient Occupancy Tax 1.8 1.9 2.0 2.0 2.1 2.1
4400 Business License Tax 1.3 1.3 1.3 1.3 1.3 1.3
4400 Licenses & Permits 3.1 2.9 3.0 3.1 3.2 3.3
4500 Intergovernmental 0.9 0.7 0.7 0.7 0.7 0.7
4600 Charge for Services 2.8 2.4 2.2 2.3 2.3 2.4
4700 Fines & Forfeitures 0.7 0.7 0.7 0.7 0.7 0.7
4800 Interest 0.3 0.3 0.3 0.4 0.4 0.4
4850 Other Sources 4.2 3.4 3.2 3.2 3.3 3.3
4900 Fund Transfers In 0.4 0.4 0.4 0.4 0.4 0.4
TOTAL REVENUES 38.8 37.9 38.1 39.1 40.1 41.1
Use of Reserves/Deposits 0.7 10.0 0.5 0.5 0.5 0.5
39.5$ 47.9$ 38.6$ 39.6$ 40.6$ 41.6$
Account Expenditure Category
2015/16
Estimated
2016/17
Forecast
2017/18
Forecast
2018/19
Forecast
2019/20
Forecast
2020/21
Forecast
5110 Salary 13.6$ 14.4$ 14.4$ 14.5$ 14.7$ 14.7$
5120 Furlough - - - - - -
5130 Temporary Employees 1.1 0.7 0.7 0.7 0.7 0.7
5140 Overtime 0.3 0.4 0.4 0.4 0.4 0.4
5170 Other Salary 0.7 0.1 0.1 0.1 0.1 0.1
5200 Benefits 7.5 8.0 8.4 9.0 9.5 9.6
6000 Supplies, Materials, & Services 5.9 5.8 5.6 5.7 5.8 6.0
6000 Pass Through Expenditures 0.6
7200 Grants & Awards 0.2 0.2 0.2 0.2 0.2 0.2
7400 Utilities 0.5 0.4 0.5 0.5 0.5 0.5
7700 Fixed Assets - - - - - -
8060 Internal Service Charges 3.5 3.7 3.8 4.1 4.2 4.4
8900 Debt Service 1.9 1.9 1.9 1.9 1.9 1.9
TOTAL EXPENDITURES 35.8$ 35.6$ 36.0$ 37.1$ 38.0$ 38.5$
9900 Operating Transfers Out 0.1 - - - - -
9900 Capital Transfers Out to GFAR 0.5 9.9 0.4 0.4 0.4 0.4
9900 GASB 45 Retiree Medical Actuarial 1.5 1.6 1.6 1.6 1.6 1.6
EXPENDITURES 37.9 47.1 38.0 39.1 40.0 40.5
37.9$ 47.1$ 38.0$ 39.1$ 40.0$ 40.5$
REVENUES LESS EXPENDITURES 1.6$ 0.8$ 0.6$ 0.5$ 0.6$ 1.1$
ONGOING SHORTFALL MITIGATION -$ -$ -$ -$ -$ -$
NET REVENUES LESS EXPENDITURES 1.6$ 0.8$ 0.6$ 0.5$ 0.6$ 1.1$
TOTAL REVENUES & TRANSFERS
TOTAL EXPENDITURES & ALLOCATIONS
Updated Five-Year Financial Plan
($ millions)
*FY 2016/17 9.9 million in use of Reserves/Deposit is for capital projects funding, inclusive of 9.5 million for Phase 2 of the
Almond Grove Street Rehabilitation Project.
The updated forecast for fiscal year 2016/17 year-end estimates indicate excess revenues over
expenditures in the amount of approximately 800,000. The forecasted excess is reflective of moderate
growth in the Town’s Property Tax collections, Transient Occupancy Taxes, business licenses, and other
licenses and permits. As per the current Town General Fund Reserve Policy, because the minimum
combined levels in the Catastrophic and Budget Stabilization reserves satisfies the required funding level
of the 25% of the FY 2016/17 operating budget, year-end savings typically transfers to the General Fund
Reserve for Capital Projects to be available to fund future capital projects. The Council may wish to
discuss other priorities for the excess such as the establishment of a CalPERS Reserve (see Pension
Liabilities discussion) and/or other purposes.
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State Budget Impacts
Details on the State of California Proposed FY 2016/17 budget will be available as part of the Governor’s
May Revised Budget and it is not expected to be materially different from the Governor’s FY 2016/17
Proposed Budget released in January 2016.
The State of California Legislative Analyst’s Office reported in February that the State has enjoyed
remarkable economic growth over the past year. The Office added the cautionary note that the State may
be reaching the peak of this long expansion. Responding to this concern, the Governor’s January 2016-17
budget proposals included a mix of adding to reserves (raising the State reserves to a target of more than
$10 billion), one time spending opportunities, and ongoing budget commitments based on California
budget priorities. The Governor’s budget allocates most other discretionary resources to one time
infrastructure spending. Outside the General Fund, the Governor plans to: (1) spend $3.1 billion cap–and–
trade auction revenues, (2) provide additional revenues for transportation, and (3) extend the managed
care organization (MCO) tax.
Regarding transportation revenues, the Governor’s proposed budget allocates about half of the new
transportation revenues to the State and half to local agencies to support various existing and new
programs. Specifically, the Governor proposes to allocate about $1.5 billion to rehabilitate state
highways, about $1.4 billion for local streets and roads, $400 million for transit, $200 million to improve
trade corridors, and $120 million for state highway maintenance. If adopted, this proposal would have the
effect in FY 2016/17 of increasing fuel tax funding of local streets and roads by about $324 million, with
an estimated increase to the Town’s Gas Tax revenues of approximately $160,000 next fiscal year. Under
current law, the Town’s share of Gas Tax revenues is proposed to be reduced again in FY 2016/17 by
approximately $28,000 from FY 2015/16 to $630,000 for FY 2016/17.
Ongoing Budget Issues:
Fire Protection Services
Fire Protection Services for the Town of Los Gatos are provided by the Santa Clara County Central Fire
Protection District. These services have been provided under an annexation agreement effective March
18, 1970 in which the tax rate then in effect for Town’s fire protection services was essentially transferred
to the County’s Central Fire Protection District. Based upon the latest assessed valuation reports
provided by the County of Santa Clara, the property tax collected from Los Gatos residents for FY
2015/16 and remitted to the Santa Clara County Central Fire Protection District for fire protection
services is estimated to be approximately $14.2 million.
Pension Liabilities
In Fiscal Year 2015/16, the Town Council’s Finance Committee met a number of times to consider
strategies to address the Town’s unfunded pension liabilities. Based on information received from staff
and the actuaries from California Public Employees Retirement System (CalPERS), the Committee
recommended to Town Council a “blended” approach of (1) recommending a modification of the Town’s
reserve policy by establishing a new California Public Employees Retirement System (CalPERS) Reserve
in the General Fund to accumulate funds needed to match rising costs of pensions and (2) to consider a
“fresh start” option, reducing the amortization period from approximately 30 years to 20 years.
Because CalPERS policy requires a “direct rate smoothing” amortization method to be used for the
“fresh start” option, there are higher forecasted initial payments than the “status quo” amortization now
in effect in the near term, lower payments in the medium-term, and higher annual payments again in the
later term. To be able to budget and fund the anticipated increases to pension expense associated with
the shorter amortization period consistently, the Committee recommended the establishment of a General
Fund PERS Reserve for a portion of annual year-end savings (yet to be determined) that will be either
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used to make a “lump sum” pay down or retained in the CalPERS Reserve for future payments for the
recommended 20-year “fresh start” option. The “fresh start” option will result in higher average annual
employer payments than would have otherwise occurred over the 30-year amortization period, and are
expected to save approximately $2 to $3 million dollars in total interest costs compared to the
approximate average 30 year amortization period now in place.
Other Post -Employment Benefits (OPEB)
The FY 2016/17 Proposed Budget includes an allocation of approximately $940,000 in “pay-as-you-go”
payments for retiree medical employer contributions. In addition, the proposed budget also includes a
$1,650,000 payment to the Town’s California Employee Retirement Benefit Trust (CERBT). The Trust
was established on June 30, 2007 and was established to address the unfunded liability that resulted from
the implementation of a new accounting standard for post-employment benefits. The Town makes annual
contributions to the California Employer’s Retiree Benefit Trust (CERBT), an agent multiple-employer
defined benefit heatlhcare plan administered by CalPERS. The purpose of the CERBT Fund is to provide
California government employers with a trust through which they may pre-fund retiree medical costs and
other post-employment benefits. To date the retiree health benefits have been paid entirely out of current
operating budgets and no withdrawals have been made from the Town’s CERBT “pre-funding” account.
The current balance in this account is approximately $8.3 million as of the close of business May 3, 2016.
To help reduce costs related to post-employment benefits the Town proactively bargained an agreement
wherein effective effective for employees retiring after February 1, 2016 the annuitant of medicare
eligible age is reimbursed to a maximum amount of benefit matching “Kasier North” Employee or
Employee plus One. It is estimated this cap on reimbursement will achieve approximately $200,000 per
year in actuarially required contributions to the OPEB plan.
Conclusion
While the global, national, state, and local economy appears to remain on the positive side, the Town
anticipates that future years may present only limited available resources to augment staffing and
services. Therefore, the FY 2016/17 budget proposes to maintain service levels and provide for minimal
staffing additions.
In light of future projections, opportunities to enhance service delivery, while lowering operating costs
through resource and workload redeployments and organizational restructuring continue to be explored.
Developments at the local and State level, including unanticipated changes in major revenue sources or
unforeseen State revenue “takes” will be brought to Town Council’s attention in a timely manner so that
an appropriate action can be taken.
I wish to thank all of the departments, in particular, Department Directors and the members of their
management and support staff, who worked diligently on the preparation of this budget document.
Specifically, I would like to recognize the efforts of:
Stephen Conway, Finance Director
Gitta Ungvari, Administrative Analyst
Mark Gaeta, Accountant
Nicole Tram, Payroll Specialist
Melissa Ynegas, Account Technician
Linda Isherwood, Analyst
Respectfully submitted,
Laurel Prevetti
Town Manager
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The Government Finance Officers Association of the United States and Canada (GFOA) has presented a
Distinguished Budget Presentation Award to the Town of Los Gatos, California for its annual budget since the
fiscal year beginning July 1, 2003. In order to receive this award, a government unit must publish a budget
document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as
a communications device.
This award is valid for a period of one year only. We believe our current budget continues to conform to
program requirements, and we are submitting it to GFOA to determine its eligibility for another award.
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