City Council

LODI CITY COUNCIL AGENDA – Shirtsleeve Session Date: May 3, 2022 Carnegie Forum Time: 7:00 a.m. 305 West Pine Street, Lodi For information regarding this Agenda please contact: Olivia Nashed City Clerk Telephone: (209) 333-6702 Notice Regarding Public Comments Public Comment may be submitted in the following ways: • In-person – The Carnegie Forum is open to the public in accordance with CDPH and CalOSHA guidelines. • Zoom Webinar  Meeting ID: 872 2014 2274  Passcode: 401448  Phone number: +1 720 07 2699 or +1 253 215 8782  Link: https://us06web.zoom.us/j/87220142274?pwd=dzYySXc2bTkvZ0ZFdlpMTkRZdW9XZz09 • Email – councilcomments@lodi.gov  Received no later than 4:30 p.m. on the business day prior to the meeting. • Mail – City Clerk’s Office, P.O. Box 3006, Lodi, CA 95241 • Hand delivered to: City Clerk’s Office, 221 W. Pine Street, Lodi, CA 95240 A. Call to Order / Roll Call B. Topics B-1 Receive Presentation Regarding Fiscal Year 2022/23 General Fund and Measure L Budget and Five- Year General Fund and Measure L Forecast. (ISD) C. Comments by Public on Non-Agenda Items THE TIME ALLOWED PER NON-AGENDA ITEM FOR COMMENTS MADE BY THE PUBLIC IS LIMITED TO FIVE MINUTES. Public comment may only be made on matters within the Lodi City Council's jurisdiction (Government Code Section 54954.3, Lodi City Council Protocol Manual Section 6.3l). The Council cannot take action or deliberate on items that are not on this agenda unless there is an emergency and the need to take action on that emergency arose after this agenda was posted (Government Code Section 54954.2(b)(2)). All other items may only be referred for review to staff or placement on a future Council agenda. If you wish to address the Council, please refer to the Notice at the beginning of this agenda. Individuals are limited to one appearance during this section of the Agenda. D. Adjournment Pursuant to Section 54954.2(a) of the Government Code of the State of California, this agenda was posted at least 72 hours in advance of the scheduled meeting at a public place freely accessible to the public 24 hours a day. ______________________________ Olivia Nashed City Clerk Revised 10/2021 4/27/2022 12:11 PM All staff reports or other written documentation relating to each item of business referred to on the agenda are on file in the Office of the City Clerk, located at 221 W. Pine Street, Lodi, and are available for public inspection. Agendas and staff reports are also posted on the City’s website at www.lodi.gov. If requested, the agenda shall be made available in appropriate alternative formats to persons with a disability, as required by Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation thereof. To make a request for disability-related modification or accommodation contact the City Clerk’s Office as soon as possible and at least 72 hours prior to the meeting date. Language interpreter requests must be received at least 72 hours in advance of the meeting to help ensure availability. Contact Olivia Nashed at (209) 333-6702. Solicitudes de interpretación de idiomas deben ser recibidas por lo menos con 72 horas de anticipación a la reunión para ayudar a asegurar la disponibilidad. Llame a Olivia Nashed (209) 333-6702. Meetings of the Lodi City Council are telecast on SJTV, Channel 26. The City of Lodi provides live and archived webcasts of regular City Council meetings. The webcasts can be found on the City's website at www.lodi.gov by clicking the meeting webcasts link. Members of the public may view and listen to the open session of this teleconference meeting at www.facebook.com/CityofLodi/ or https://us06web.zoom.us/j/87220142274?pwd=dzYySXc2bTkvZ0ZFdlpMTkRZdW9XZz09.  AGENDA ITEM B-01 COUNCIL COMMUNICATION AGENDA TITLE: Receive Presentation Regarding Fiscal Year 2022/23 General Fund and Measure L Budget and Five-Year General Fund and Measure L Forecast MEETING DATE: May 3, 2022 PREPARED BY: Deputy City Manager RECOMMENDED ACTION: Receive presentation regarding Fiscal Year 2022/23 General Fund and Measure L budget and the five-year General Fund and Measure L forecast. BACKGROUND INFORMATION: Staff has planned a series of presentations to provide the City Council and public an opportunity to review and comment on basic assumptions within the FY 2022/23 budget to be proposed to Council later this month. The draft budget will be released and made available for public review Online once the draft is finalized. This session is designed to provide information on the general economic conditions facing City staff and Council in allocating resources to most effectively deliver services, with particular focus on the General Fund and Measure L. Included in the presentation will be a discussion of Fiscal Year 2022/23 General Fund and Measure L expenditures and the General Fund and Measure L five-year forecast. The forecast is a critical planning tool for staff and Council to use to anticipate future resource or service level adjustments. The forecast presented will include a baseline scenario that keeps normal operations with no change in service levels. Future Council presentations will focus on other aspects of the City budget beyond the General Fund and Measure L. The first opportunity for the City Council to adopt the Fiscal Year 2022/23 budget will be at its regular meeting on June 1, 2022. FISCAL IMPACT: There is no impact from this informational presentation. FUNDING AVAILABLE: The draft General Fund and Measure L budgets for Fiscal Year 2022/23 is projected at $73,892,170 for both revenues and expenditures. _______________________________________ Andrew Keys Deputy City Manager/Internal Services Director APPROVED: ________________________________ Stephen Schwabauer, City Manager Fiscal Year 2022/23 Budget General Fund Presented by Andrew Keys, Deputy City Manager  Overview • General Fund Assumptions/Revenues/Expenses Key Inputs Five Year Forecast  General Fund Assumptions • Overall revenues are projected at a small increase over mid-year projections when adjusted for ARPA and FEMA reimbursements • Expenditures are showing increases primarily in PERS Unfunded Liability, additional support for vehicles and equipment replacement funds; additional support to Library and PRCS operations and general goods and services cost increases • Increase of 6.4 positions  General Fund Revenues $73,892,170 Budget Revenue FY 2022/23 Tax Revenues $ 54,280,830 Revenue from Others $ 7,482,890 Operating Transfers In $ 7,115,470 charges for Services $ 1,857,180 Property Revenue $ 1,756,000 Fines & Forfeitures $ 815,100 Other Revenue $ 523,500 Licenses & Permits $ 61,200 Total $ 73,892,170  General Fund Expenditures $73,892,170 Budget General Fund Expenditures by Department FY 2022/23 Police $ 29,997,060 Fire $ 17,730,630 Non-Dept $ 11,080,340 Internal Services $ 6,546,100 Public Works $ 3,751,040 Parks, Rec & Cultural Srvs (Measure L support $ 1,045,250 City Attorney $ 825,880 City Clerk $ 801,930 City Manager $ 791,680 Eco Development $ 500,240 Com Improvement $ 484,700 Library (Measure L support) $ 337,320 Total $ 73,892,170  General Fund Key Inputs • Net increase of 6.4 full-time positions Job Title Department +/- Management Analyst * Fire +0.4 Administrative Analyst Internal Services +1 Budget Manager ** Internal Services +1 Administrative Assistant Police +1 Police Sergeant (Traffic) Police +1 Property & Evidence Tech ** Police +1 Management Analyst Public Works +1 Net Increase 6.4 * This position has been split 60/40 in PRCS and is now recommended 100% in General Fund ** These positions are for succession planning and are temporary  General Fund Key Inputs • Increased base operational support to Library and Parks, Recreation and Cultural Services by 8.48% • Library: $119,140 funded by Measure L • PRCS: $302,880 funded by Measure L • Continue transfer to Parks Capital Fund • $400,000 funded by Measure L • Transfers to Police and Fire Vehicle Replacement Fund • Police: $1,260,000 an increase of $786,000 • Fire: $400,000 funded by Measure L  Parks, Rec & Cultural Svs. Support $5,961,520 • General Fund support for Parks, Recreation and Cultural Services: • Operational Support of $4,295,600 • $3,225,950 General Fund base support • $147,540 of FY 22 mid-year new staff support • $645,250 Measure L base support • FY 22 base $342,370 • FY 23 base $302,880 • $85,000 for vehicle replacement fund • $38,000 for new Administrative Analyst • $153,860 to close revenue gap  Parks, Rec & Cultural Svs. Support $5,961,520 • General Fund support (cont.) • Cost of Services of $830,010 • Debt Service of $435,910 • Ongoing Capital Support of $400,000 funded by Measure L • In addition to the listed FY 23 items, the General Fund transferred $6,960,000 in FY 22 1x monies to Parks capital accounts to support major infrastructure needs such as Lodi Lake improvements, playground replacements, parking lot overlay, sports lighting and building renovations.  Measure L • Revenues: $9,118,800 • Expenditures: $9,118,800 FY 2021/22 FY 2022/23 Measure L Funded Positions Budget Budget Cost: Police Officers 20 26 $3,979,290 Firefighters 8 8 $1,119,040 Librarian 1 1 $98,140 Street Maintenance Wrk III 0.2 0.2 $31,360 Total Full-Time 29.2 35.2 $ 5,227,830 Public Safety Overtime $1,779,120 Part-Time Community Service Officers (2) $84,020 Supplies, Materials, Training $349,520 Library Operations $233,060 Parks, Recreation & Cultural Srvs Operations $645,250 Parks Capital $400,000 Fire Vehicle Replacement $400,000 Measure L Total $ 9,118,800  Vehicle Replacement Fund Vehicle Replacement 6/30/22 YE 2022/23 2022/23 6/30/23 YE Fund Over/(Under) Funds Est Fund Bal Proj Rev Est Exp Est Fund Bal Target* Target Comm. Dev. 90,788 45,000 45,000 90,788 48,846 41,942 Fire Dept. -164,860 400,000 0 235,140 1,379,098 (1,143,958) Community Imp. 82,500 0 0 82,500 45,967 31,670 Police Dept. 1,091,436 1,260,000 610,000 1,741,436 1,891,045 (149,609) PRCS 359,012 88,300 116,000 331,312 893,728 (586,987) PW-GF 80,144 20,000 45,000 55,144 168,111 (112,967) Grand Total 1,539,020 1,813,300 816,000 2,536,320 4,426,795 (1,919,909) *Fund Target is the straight line depreciation value of vehicle stock that should be set aside for future replacements using Fleet Services estimated useful life expectancies by vehicle type. Vehicle FY 23 Straight Line FY 23 Replacement Depreciation Recommended Annual Funding Funds Requirement Funding Surplus/(Shortage) Comm. Dev. $4,570 $45,000 $40,430 Fire Dept. $216,051 $400,000 $183,949 Community Imp. $3,328 $0 ($3,328) Police Dept. $279,508 $1,260,000 $980,492 PRCS $36,056 $88,300 $52,244 PW-GF $15,345 $20,000 $4,655 Grand Total $554,858 $1,813,300 $1,258,442 *PRCS straight line depreciation reduced as compared to FY 22 due to reclassification of some items as equipment, following an inventory review.  5 Year Forecast - Assumptions • FY 2023 budget as recommended is projected forward • Includes continued contributions to PRCS capital and network infrastructure started in FY 2022, and new positions being recommended in FY 2023 • Labor contracts expire June 30, 2022 or December 31, 2022 • No specific assumptions for future contracts are included, but a general allowance for salary increases is factored based on labor discussions with Council • Assumes 100% full employment (no vacancies) • Continued, strong growth is projected, albeit at a more measured pace than the past few years 5 Year Forecast - Assumptions Revenue Category FY 22/23 B FY 23/24 FY 24/25 FY 25/26 FY 26/27 FY 27/28 Property Taxes - Secured 4.9% 3.7% 3.7% 3.7% 3.7% 3.7% Sales & Use Taxes 2.0% 3.0% 3.5% 3.5% 3.5% 3.5% Transient Occupancy Tax 5.0% 5.0% 5.0% 3.0% 3.0% 3.0% Business License Tax 8.6% 10.0% 10.0% 3.5% 3.5% 3.5% Other Taxes -0.4% 3.0% 3.0% 3.0% 3.0% 3.0% EU Pilot 1.8% 0.5% 0.5% 0.5% 0.5% 0.5% Property Tax in Lieu VLF 7.0% 3.7% 3.7% 3.7% 3.7% 3.7% Transfers In 9.8% 2.0% 2.0% 2.0% 2.0% 2.0% Property Taxes - CFD 26.2% 10% 10% 5% 5% 5% Measure L 2.0% 3.0% 3.5% 3.5% 3.5% 3.5% Other Revenues 16.1% 2.0% 2.0% 2.0% 2.0% 2.0% City of Lodi 5 Year General Fund Forecast Assumptions Expense Category FY 22/23 B [1] FY 23/24 FY 24/25 FY 25/26 FY 26/27 FY 27/28 Salaries [2] N/A 3.0% 3.0% 3.0% 2.0% 2.0% PERS Normal Cost N/A 3.0% 3.0% 3.0% 2.0% 2.0% PERS UAL N/A 7.5% 7.5% 5.0% 5.0% 5.0% Other Benefits N/A 2.0% 2.0% 2.0% 2.0% 2.0% Operations N/A 2.0% 2.0% 2.0% 2.0% 2.0% Debt [3] N/A 0.2% 0.2% -0.1% -0.1% 0.1% Transfers N/A 0.5% 0.5% 0.5% 0.5% 0.5%  5 Year Forecast - Revenue Revenue FY 21/22 E FY 22/23 B FY 23/24 FY 24/25 FY 25/26 FY 26/27 FY 27/28 Property Taxes 12,456,500 13,070,000 13,554,000 14,056,000 14,577,000 15,117,000 15,677,000 Sales & Use Taxes 16,325,000 16,651,000 17,151,000 17,752,000 18,374,000 19,018,000 19,684,000 Transient Occupancy Tax 1,500,000 1,575,000 1,654,000 1,737,000 1,790,000 1,844,000 1,900,000 Business License Tax 1,750,000 1,900,000 2,090,000 2,299,000 2,380,000 2,464,000 2,551,000 Other Taxes 3,777,970 3,761,790 3,875,000 3,992,000 4,112,000 4,236,000 4,364,000 EU Pilot 7,432,690 7,564,240 7,603,000 7,642,000 7,681,000 7,720,000 7,759,000 Property Tax in Lieu VLF 6,375,000 6,820,000 7,073,000 7,335,000 7,607,000 7,889,000 8,181,000 Transfer In 6,478,410 7,115,470 7,258,000 7,404,000 7,553,000 7,705,000 7,860,000 Property Taxes - CFD 507,000 640,000 704,000 775,000 814,000 855,000 898,000 Measure L 8,940,000 9,118,800 9,393,000 9,722,000 10,063,000 10,416,000 10,781,000 Other Revenues 4,889,080 5,675,870 5,790,000 5,906,000 6,025,000 6,146,000 6,269,000 Total Revenue 70,431,650 73,892,170 76,145,000 78,620,000 80,976,000 83,410,000 85,924,000 Revenue Growth [1] 8.2% 4.9% 3.0% 3.3% 3.0% 3.0% 3.0% 5 Year Forecast - Expenses 5 Year Forecast – Fund Balance 5 Year Forecast – Fund Balance  5 Year Forecast – Risks/Opportunities Risks • Recession • Inflation (particularly fuel and food) • Global conflict • Consumer demand? • Labor Negotiations – mitigated by set asides in budget • CalPERS UAL or other assumptions changes – minimal given current ALS cycle appears on track to not make significant changes • Pace of Development • Additional service needs/demands from the public Opportunities • Recent revenue trend line is above the forecast base case • Economic development • Loan program • Substantial new municipal capital spending ($9.72 million one time General Fund Surplus and $15 million for the animal shelter and parks projects) • Revenue enhancement • Vacancies • Workforce Demographics Questions? 19