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Home My WebLink About2018-03-20 Item 10 - PresentationBUDGET WORKSHOP AND LONG TERM FINANCIAL PLAN 1 FY 2018 BUDGET 2 FY2018 Projected Budget 3 Revenues: Adopted Budget $166.59 Significant Adjustments Measure P Bond Proceeds 18.69 Increase to Measure P funding projections 1.48 Funding via SAFER Grant 0.46 Increase in MVLF 0.32 Other Adjustments 1.64 Projected Revenues $189.18 Expenditures: Adopted Budget $166.59 Significant Adjustments Transfer of Measure P Bond Proceeds 18.69 Transfer of Measure P funding 1.48 Increase in Debt Service payments 1.49 Addition of Fire Academy 1.00 Other Adjustments 0.34 Projected Expenditures $189.59 SURPLUS/(DEFICIT)($0.41) 1 As of the FY 2017-2018 Second Quarter Report (2/27/18). Fiscal Year 2017-2018 Projected General Fund Budget 1 (millions) LONG-TERM FINANCIAL PLAN FY2018 TO FY2028 4 Fiscal Projections Summary (FY2018 –FY2023) 5 Ten-Year Financial Forecast (millions) Revised Forecast Forecast Forecast Forecast Forecast FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 TOTAL REVENUES 189.18$ 172.80$ 176.20$ 179.92$ 183.00$ 186.84$ TOTAL EXPENDITURES 189.59$ 180.80$ 189.59$ 199.18$ 208.88$ 216.68$ TOTAL GENERAL FUND SURPLUS/(DEFICIT)(0.41)$ (8.01)$ (13.39)$ (19.26)$ (25.88)$ (29.84)$ SURPLUS/(DEFICIT) AS % OF BUDGET 0%-4%-7%-10%-12%-14% FY 2018 Post-Budget Adoption Changes Utility Savings through Measure P Projects -$ -$ 0.83$ 1.65$ 1.65$ 1.65$ Utility Savings through Renewable solar bonds 0.28$ 0.28$ 0.30$ 0.33$ 0.34$ Additional Salary Savings -$ 0.50$ 0.51$ 0.52$ 0.53$ 0.54$ Development Fee Revenue -$ 0.80$ 0.80$ 0.80$ 0.80$ 0.80$ Interest Earning -$ 0.40$ 0.40$ 0.40$ 0.40$ 0.40$ PFDIF Loan Repayment -$ 1.50$ -$ -$ -$ -$ FEMA Reimbursement -$ 1.50$ -$ -$ -$ -$ Liquidation of General Fund CIP Encumbrances -$ 0.80$ -$ -$ -$ -$ Additional Police Expenses -$ (0.40)$ -$ -$ -$ -$ TOTAL FY 2018 Post-Budget Adoption Changes -$ 5.78$ 2.82$ 3.67$ 3.71$ 3.73$ SURPLUS/(DEFICIT) WITH ADMINISTRATIVE ACTIONS (0.41)$ (2.22)$ (10.58)$ (15.59)$ (22.17)$ (26.11)$ Description Fiscal Projections Summary (FY2024 –FY2028) 6 Ten-Year Financial Forecast (millions) Forecast Forecast Forecast Forecast Forecast FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 TOTAL REVENUES 189.81$ 193.78$ 197.86$ 196.77$ 185.52$ TOTAL EXPENDITURES 223.80$ 230.84$ 238.16$ 240.76$ 234.09$ TOTAL GENERAL FUND SURPLUS/(DEFICIT)(33.98)$ (37.07)$ (40.30)$ (43.99)$ (48.56)$ SURPLUS/(DEFICIT) AS % OF BUDGET -15%-16%-17%-18%-21% FY 2018 Post-Budget Adoption Changes Utility Savings through Measure P Projects 1.65$ 1.65$ 1.65$ 1.65$ 1.65$ Utility Savings through Renewable solar bonds 0.32$ 0.33$ 0.34$ 0.35$ 0.35$ Additional Salary Savings 0.55$ 0.56$ 0.57$ 0.59$ 0.60$ Development Fee Revenue 0.80$ 0.80$ 0.80$ 0.80$ 0.80$ Interest Earning 0.40$ 0.40$ 0.40$ 0.40$ 0.40$ PFDIF Loan Repayment -$ -$ -$ -$ -$ FEMA Reimbursement -$ -$ -$ -$ -$ Liquidation of General Fund CIP Encumbrances -$ -$ -$ -$ -$ Additional Police Expenses -$ -$ -$ -$ -$ TOTAL FY 2018 Post-Budget Adoption Changes 3.72$ 3.74$ 3.76$ 3.78$ 3.79$ SURPLUS/(DEFICIT) WITH ADMINISTRATIVE ACTIONS (30.27)$ (33.33)$ (36.54)$ (40.21)$ (44.77)$ Description Revenue Projections (FY2018 –FY2023) 7 Revised Forecast Forecast Forecast Forecast Forecast FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Revenue Projections (millions) Property Taxes 33.69$ 34.36$ 35.30$ 36.26$ 37.26$ 38.28$ Sales Tax 32.90$ 33.23$ 33.45$ 33.67$ 33.80$ 34.14$ Measure P Sales Tax 17.80$ 17.98$ 18.10$ 18.22$ 18.32$ 18.47$ Franchise Fees 11.97$ 11.57$ 11.76$ 11.96$ 12.16$ 12.36$ Utility Users Taxes 5.86$ 5.92$ 5.98$ 6.04$ 6.10$ 6.16$ Transient Occupancy Taxes 4.04$ 4.36$ 5.61$ 5.73$ 5.84$ 5.96$ Motor Vehicle License Fees 21.16$ 21.47$ 22.11$ 22.77$ 23.45$ 24.15$ SUBTOTAL MAJOR DISCRETIONARY REVENUES 127.42$ 128.88$ 132.30$ 134.64$ 136.92$ 139.50$ Development Revenue 1.21$ 1.21$ 1.22$ 1.22$ 1.23$ 1.24$ Licenses and Permits 1.38$ 1.39$ 1.42$ 1.45$ 1.48$ 1.51$ Fines, Forfeitures & Penalties 1.08$ 1.10$ 1.12$ 1.14$ 1.16$ 1.19$ Use of Money and Property 2.46$ 2.45$ 2.47$ 2.49$ 2.52$ 2.55$ Other Local Taxes 2.60$ 2.62$ 2.65$ 2.68$ 2.70$ 2.73$ Police Grants 0.77$ 0.76$ 0.76$ 0.76$ 0.76$ 0.76$ Other Agency Revenue 2.05$ 2.05$ 2.07$ 2.09$ 2.11$ 2.13$ Charges for Services 7.21$ 7.25$ 7.28$ 7.32$ 7.36$ 7.39$ Interfund Reimbursements 9.82$ 9.92$ 10.01$ 10.11$ 9.76$ 9.86$ Other Revenues - Miscellaneous 22.46$ 1.04$ 1.04$ 1.05$ 1.06$ 1.06$ Transfers From Other Funds 10.72$ 10.90$ 10.90$ 10.90$ 10.90$ 10.90$ SUBTOTAL OTHER REVENUES 61.76$ 40.67$ 40.94$ 41.20$ 41.03$ 41.30$ Description Revenue Projections (cont.) (FY2018 –FY2023) 8 Revised Forecast Forecast Forecast Forecast Forecast FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Revenue Projections (millions) NEW DEVELOPMENT REVENUES Property Taxes -$ 0.73$ 1.01$ 1.41$ 1.76$ 2.10$ Sales Tax -$ 0.15$ 0.32$ 0.45$ 0.59$ 0.74$ Franchise Fees -$ 0.20$ 0.28$ 0.36$ 0.45$ 0.54$ Utility Users Taxes -$ 0.08$ 0.11$ 0.14$ 0.18$ 0.21$ Transient Occupancy Taxes -$ 1.19$ -$ -$ -$ -$ Motor Vehicle License Fees -$ 0.49$ 0.68$ 0.95$ 1.19$ 1.42$ Other Revenues - Miscellaneous -$ 0.27$ 0.38$ 0.50$ 0.62$ 0.74$ Other Local Taxes -$ 0.15$ 0.19$ 0.26$ 0.26$ 0.28$ SUBTOTAL NEW DEVELOPMENT REVENUES -$ 3.25$ 2.96$ 4.07$ 5.05$ 6.03$ TOTAL REVENUES 189.18$ 172.80$ 176.20$ 179.92$ 183.00$ 186.84$ Year-over-Year Change -8.66%1.97%2.11%1.71%2.10% Description Revenue Projections (FY2024 –FY2028) 9 Forecast Forecast Forecast Forecast Forecast FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 Revenue Projections (millions) Property Taxes 38.37$ 39.46$ 40.58$ 41.73$ 42.92$ Sales Tax 34.48$ 34.82$ 35.17$ 35.52$ 35.88$ Measure P Sales Tax 18.65$ 18.84$ 19.03$ 14.41$ -$ Franchise Fees 12.56$ 12.77$ 12.98$ 13.20$ 13.42$ Utility Users Taxes 6.22$ 6.28$ 6.35$ 6.41$ 6.47$ Transient Occupancy Taxes 6.08$ 6.20$ 6.32$ 6.45$ 6.58$ Motor Vehicle License Fees 24.87$ 25.61$ 26.38$ 27.17$ 27.98$ SUBTOTAL MAJOR DISCRETIONARY REVENUES 141.23$ 143.98$ 146.80$ 144.88$ 133.24$ Development Revenue 1.24$ 1.25$ 1.25$ 1.26$ 1.27$ Licenses and Permits 1.54$ 1.57$ 1.60$ 1.63$ 1.66$ Fines, Forfeitures & Penalties 1.21$ 1.24$ 1.26$ 1.29$ 1.31$ Use of Money and Property 2.57$ 2.60$ 2.62$ 2.65$ 2.67$ Other Local Taxes 2.76$ 2.79$ 2.81$ 2.84$ 2.87$ Police Grants 0.76$ 0.76$ 0.76$ 0.76$ 0.76$ Other Agency Revenue 2.15$ 2.17$ 2.19$ 2.22$ 2.24$ Charges for Services 7.43$ 7.47$ 7.50$ 7.54$ 7.58$ Interfund Reimbursements 9.96$ 10.06$ 10.16$ 10.26$ 10.36$ Other Revenues - Miscellaneous 1.07$ 1.07$ 1.08$ 1.08$ 1.09$ Transfers From Other Funds 10.90$ 10.90$ 10.90$ 10.90$ 10.90$ SUBTOTAL OTHER REVENUES 41.58$ 41.86$ 42.13$ 42.42$ 42.71$ Description Revenue Projections (cont.) (FY2024 –FY2028) 10 Forecast Forecast Forecast Forecast Forecast FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 Revenue Projections (millions) NEW DEVELOPMENT REVENUES Property Taxes 2.46$ 2.79$ 3.19$ 3.37$ 3.37$ Sales Tax 0.85$ 0.96$ 1.06$ 1.16$ 1.17$ Franchise Fees 0.63$ 0.72$ 0.80$ 0.88$ 0.90$ Utility Users Taxes 0.25$ 0.28$ 0.32$ 0.32$ 0.32$ Transient Occupancy Taxes -$ -$ -$ -$ -$ Motor Vehicle License Fees 1.66$ 1.89$ 2.15$ 2.27$ 2.34$ Other Revenues - Miscellaneous 0.86$ 0.98$ 1.06$ 1.16$ 1.17$ Other Local Taxes 0.31$ 0.33$ 0.35$ 0.30$ 0.30$ SUBTOTAL NEW DEVELOPMENT REVENUES 7.01$ 7.94$ 8.92$ 9.47$ 9.58$ TOTAL REVENUES 189.81$ 193.78$ 197.86$ 196.77$ 185.52$ Year-over-Year Change 1.59%2.09%2.11%-0.55%-5.71% Description LTFP Revenue Assumptions •Major Revenues growth assumptions: –Property Tax and MVLF: average of 3% per year –Sales Tax: average of 1% per year –Measure P Sales Tax: average of 1% per year –Franchise Fees: approximately 2% per year –UUT: 1% per year –TOT: average of 2% per year 11 LTFP Revenue Assumptions (cont.) •Development revenue projections based on continued development in the City •Property Tax revenues include projected RPTTF payments for SERAF loan of approx. $1.8 million per year from FY2019 –FY2023 •The use of Economic Contingency funds is not assumed. The forecast does not assume a recession. 12 Expenditure Projections (FY2018 –FY2023) 13 Revised Forecast Forecast Forecast Forecast Forecast FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Expenditure Projections (millions) Personnel Services 91.28$ 91.11$ 92.42$ 94.17$ 95.97$ 97.80$ PERS 24.43$ 27.69$ 31.68$ 35.59$ 38.89$ 41.90$ Fire Department - MOU Differential -$ 0.13$ 0.13$ 0.13$ 0.13$ 0.14$ Flex/Insurance 12.21$ 12.62$ 13.13$ 13.66$ 14.21$ 14.79$ CalPERS UAL Differential -$ 1.30$ 1.55$ 1.75$ 1.99$ 2.21$ Salary Savings (On Going)(0.84)$ (0.86)$ (0.89)$ (0.92)$ (0.95)$ (0.99)$ Salary Savings (One-Time)(1.34)$ -$ -$ -$ -$ -$ SUBTOTAL PERSONNEL SERVICES EXPENDITURES 125.75$ 131.99$ 138.01$ 144.37$ 150.24$ 155.84$ Supplies and Services 16.80$ 15.49$ 16.73$ 18.07$ 19.34$ 19.72$ Tyler Munis Ongoing License Fee -$ 0.29$ 0.29$ 0.29$ 0.29$ 0.29$ Utilities 5.57$ 5.32$ 5.58$ 5.86$ 6.15$ 6.46$ Other Expenses 1.18$ 0.66$ 0.67$ 0.68$ 0.70$ 0.71$ Equipment (Capital not CIP)0.35$ 0.15$ 0.15$ 0.15$ 0.15$ 0.15$ Transfers/Debt Service 43.31$ 25.34$ 25.07$ 25.09$ 25.14$ 25.36$ Capital Improvement Projects 1.48$ -$ -$ -$ -$ -$ Non-CIP Project Expenditures 0.90$ 0.02$ 0.02$ 0.02$ 0.02$ 0.02$ Prior Year Appropriations - Carry Forward (5.75)$ -$ -$ -$ -$ -$ SUBTOTAL OTHER EXPENDITURES 63.85$ 47.26$ 48.51$ 50.16$ 51.78$ 52.71$ Description Expenditure Projections (FY2018 –FY2023) 14 Revised Forecast Forecast Forecast Forecast Forecast FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Expenditure Projections (millions) NEW PROGRAMS & NEW DEVELOPMENT EXPENDITURES 12 new firefighters with 3 yr SAFER grant offset -$ 0.91$ 1.03$ 1.63$ 2.17$ 2.28$ 4.0 Truck Staffing for Bayfront*-$ -$ -$ -$ 0.48$ 0.51$ Peace Officer Funding -$ 0.38$ 1.63$ 2.58$ 3.62$ 4.75$ New Police Technology -$ 0.19$ 0.19$ 0.20$ 0.19$ 0.19$ Millenia Parks Maintenance -$ 0.08$ 0.08$ 0.08$ 0.08$ 0.08$ Fire Station Supplies and Services -$ -$ 0.16$ 0.16$ 0.32$ 0.32$ SUBTOTAL NEW DEVELOPMENT EXPENDITURES -$ 1.55$ 3.08$ 4.64$ 6.86$ 8.13$ TOTAL EXPENDITURES 189.59$ 180.80$ 189.59$ 199.18$ 208.88$ 216.68$ Year-over-Year Change -4.64%4.86%5.05%4.87%3.74% Description *Personnel expenses related to Millenia Station shown in previous LTFP has been removed pending the outcome of future sales tax measure. Expenditure Projections (FY2024 –FY2028) 15 Forecast Forecast Forecast Forecast Forecast FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 Expenditure Projections (millions) Personnel Services 99.66$ 101.57$ 103.51$ 105.50$ 107.52$ PERS 44.17$ 46.19$ 48.31$ 50.53$ 52.86$ Fire Department - MOU Differential 0.14$ 0.14$ 0.14$ 0.15$ 0.15$ Flex/Insurance 15.40$ 16.03$ 16.69$ 17.38$ 18.11$ CalPERS UAL Differential 2.37$ 2.49$ 2.61$ 2.74$ 2.88$ Salary Savings (On Going)(1.02)$ (1.05)$ (1.07)$ (1.10)$ (1.13)$ Salary Savings (One-Time)-$ -$ -$ -$ -$ SUBTOTAL PERSONNEL SERVICES EXPENDITURES 160.72$ 165.37$ 170.19$ 175.20$ 180.38$ Supplies and Services 20.12$ 20.52$ 20.93$ 21.35$ 21.78$ Tyler Munis Ongoing License Fee 0.29$ 0.29$ 0.29$ 0.29$ 0.29$ Utilities 6.79$ 7.12$ 7.48$ 7.85$ 8.25$ Other Expenses 0.72$ 0.74$ 0.75$ 0.77$ 0.78$ Equipment (Capital not CIP)0.15$ 0.15$ 0.15$ 0.15$ 0.15$ Transfers/Debt Service 25.53$ 25.70$ 25.87$ 21.01$ 6.70$ Capital Improvement Projects -$ -$ -$ -$ -$ Non-CIP Project Expenditures 0.02$ 0.02$ 0.02$ 0.02$ 0.02$ Prior Year Appropriations - Carry Forward -$ -$ -$ -$ -$ SUBTOTAL OTHER EXPENDITURES 53.62$ 54.54$ 55.49$ 51.44$ 37.96$ Description Expenditure Projections (FY2024 –FY2028) 16 Forecast Forecast Forecast Forecast Forecast FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 Expenditure Projections (millions) NEW PROGRAMS & NEW DEVELOPMENT EXPENDITURES 12 new firefighters with 3 yr SAFER grant offset 2.39$ 2.50$ 2.61$ 2.73$ 2.82$ 4.0 Truck Staffing for Bayfront*0.53$ 0.56$ 0.58$ 0.61$ 0.63$ Peace Officer Funding 5.96$ 7.28$ 8.67$ 10.19$ 11.68$ New Police Technology 0.20$ 0.20$ 0.22$ 0.21$ 0.21$ Millenia Parks Maintenance 0.08$ 0.08$ 0.08$ 0.08$ 0.08$ Fire Station Supplies and Services 0.32$ 0.32$ 0.32$ 0.32$ 0.32$ SUBTOTAL NEW DEVELOPMENT EXPENDITURES 9.46$ 10.94$ 12.47$ 14.12$ 15.74$ TOTAL EXPENDITURES 223.80$ 230.84$ 238.16$ 240.76$ 234.09$ Year-over-Year Change 3.28%3.15%3.17%1.09%-2.77% Description *Personnel expenses related to Millenia Station shown in previous LTFP has been removed pending the outcome of future sales tax measure. Expenditure LTFP Assumptions •Personnel Services –Includes a 2% wage inflation per year –PERS costs reflect estimated contribution rates provided by CalPERs Valuation Report as of June 30, 2016 –Salary savings is calculated at 1% per year (Salaries/PERS/Medicare) –Assumes 4.0 fire staffing for Bayfront in FY2022 –Projects the cost estimates for 50.0 Peace Officers –Includes Flex/Insurance increases of 2.75% for Misc and 5.5% for Safety per year –An increase in Workers Compensation contributions 17 Expenditure LTFP Assumptions (cont.) •Supplies and Services –Assumes Millenia and Bayfront fire station in FY2020 and FY2022 •Other expenditure categories: –Utilities at 5% per year net of new renewable energy projects –Other Expenses at 2% per year –Equipment at 0% per year –Transfers Out includes expenditures related to debt service payments and anticipated transfers to other funds 18 PENSION 19 Pension Costs City’s contribution to pensions costs made up of two parts: (1)Unfunded Accrued Liability (UAL) contributions – for pension benefits already earned (2)Normal Cost Contribution (percentage of payroll) – for pensions benefits of active employees The combination of the two costs create the City’s total annual pension costs 20 Pension –UAL Costs UAL contributions calculated by actuary and are impacted by multiple factors including: •Amortization (pay off) schedule •Assumed interest return/discount rate on investment portfolio –FY2019 (7.375%), FY2020 (7.250%), FY2021 (7.00%) •Actual interest return on investment portfolio UAL can be prepaid at beginning of fiscal year for discount savings 21 Pension –UAL Costs 22 FY 2018 FY 2019 Increase / (Decrease) UAL Balance 261,221,387 321,599,399 60,378,012 Funded Ratio 71.2%66.5%-4.7% UAL Pre-Payment 15,204,466 18,293,245 3,088,779 *Based on CalPERs Actuarial Valuation Report as of June 30, 2016. Drivers:FY 2018 FY 2019 Change in Discount Rate 7.50%7.50% to 7.375% Investment Performance**0.60%11.30% UAL Balance, Funding Ratio and Payment* **UAL payment impacted by investment returns two years in arrears. Figures shown represent investment performance to impact payment year. Pension –Normal Costs Normal Cost contributions are calculated as a percentage of the current payroll and are impacted by multiple factors including: •Retirement rates •Salary growth rates •Future investment earnings City and employees contribute to Normal Costs •Total Projected cost –Employees contribution = City’s cost 23 Estimated City Contribution Based on Projected Payroll Citywide FY 2018 FY 2019 Total Normal Cost $20,654,496 $21,673,645 Employee Contribution $7,291,437 $7,532,988 City's Normal Cost $13,363,059 $14,140,657 Projected Pension Costs 24 Required Contribution FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Annual Normal Costs*$11,811,859 $12,509,770 $12,895,678 $14,449,003 $14,882,473 $15,328,947 Annual UAL Costs*$12,619,707 $15,183,393 $18,781,240 $21,137,610 $24,011,070 $26,566,640 General Fund Total $24,431,566 $27,693,163 $31,676,918 $35,586,613 $38,893,543 $41,895,587 Year-over-Year Increase 13%14%12%9%8% Total Pension Costs $28,567,525 $32,433,902 $37,282,179 $41,886,321 $45,840,901 $49,427,258 Projected Future Employer Contributions General Fund *FY 2019 - 2025 based CalPERS Annual Valuation Reports (Valuation Reports) as of June 30, 2016. FY 2026 - 2028 projections determined by continuing assumptions used in Valuation Reports. Projected Pension Costs 25 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 Annual Normal Costs*$15,788,816 $16,262,480 $16,750,355 $17,252,865 $17,770,451 Annual UAL Costs*$28,382,680 $29,931,460 $31,561,132 $33,280,273 $35,093,837 General Fund Total $44,171,496 $46,193,940 $48,311,486 $50,533,138 $52,864,288 Year-over-Year Increase 5%5%5%5%5% Total Pension Costs $52,137,836 $54,542,091 $57,059,954 $59,702,243 $62,475,425 Projected Future Employer Contributions *FY 2019 - 2025 based CalPERS Annual Valuation Reports (Valuation Reports) as of June 30, 2016. FY 2026 - 2028 projections determined by continuing assumptions used in Valuation Reports. General Fund Projected Pension Costs 26 Required Contribution FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Annual Normal Costs*$1,551,200 $1,630,887 $1,758,501 $1,970,319 $2,029,428 $2,090,311 Annual UAL Costs*$2,584,759 $3,109,852 $3,846,760 $4,329,390 $4,917,930 $5,441,360 Non-General Fund Total $4,135,959 $4,740,739 $5,605,261 $6,299,709 $6,947,358 $7,531,671 Year-over-Year Increase 15%18%12%10%8% Total Pension Costs $28,567,525 $32,433,902 $37,282,179 $41,886,321 $45,840,901 $49,427,258 Projected Future Employer Contributions Non-General Fund *FY 2019 - 2025 based CalPERS Annual Valuation Reports (Valuation Reports) as of June 30, 2016. FY 2026 - 2028 projections determined by continuing assumptions used in Valuation Reports. Projected Pension Costs 27 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 Annual Normal Costs*$2,153,020 $2,217,611 $2,284,139 $2,352,663 $2,423,243 Annual UAL Costs*$5,813,320 $6,130,540 $6,464,328 $6,816,441 $7,187,894 Non-General Fund Total $7,966,340 $8,348,151 $8,748,467 $9,169,105 $9,611,138 Year-over-Year Increase 6%5%5%5%5% Total Pension Costs $52,137,836 $54,542,091 $57,059,954 $59,702,243 $62,475,425 Non-General Fund Projected Future Employer Contributions *FY 2019 - 2025 based CalPERS Annual Valuation Reports (Valuation Reports) as of June 30, 2016. FY 2026 - 2028 projections determined by continuing assumptions used in Valuation Reports. Citywide Pension Contribution 28 $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 $15.2 $18.3 $22.6 $25.5 $28.9 $32.0 $34.2 $36.1 $38.0 $40.1 $42.3$13.4 $14.1 $14.7 $16.4 $16.9 $17.4 $17.9 $18.5 $19.0 $19.6 $20.2 Projected Total Annual City Pension Contribution Normal Cost UALMillions Notes: Based on CalPERs Actuarial Valuation as of June 30, 2016. FY 2026 -2028 projections determined by continuing assumptions used in Vaulation Reports. General Fund Pension Contribution 29 $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 $12.6 $15.2 $18.8 $21.1 $24.0 $26.6 $28.4 $29.9 $31.6 $33.3 $35.1$11.8 $12.5 $12.9 $14.4 $14.9 $15.3 $15.8 $16.3 $16.8 $17.3 $17.8 Projected Annual General Fund Pension Contribution Normal Cost UALMillions Notes: Based on CalPERs Actuarial Valuation as of June 30, 2016. FY 2026 -2028 projections determined by continuing assumptions used in Vaulation Reports. Health Insurance Premium History $16,608 $35,424 $22,704 $21,072 $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Employee + Family Healthcare Premiums 2009 to 2018 Kaiser PPO Full Value Potential Solutions •Technology •Efficiency •Use of One-Time Funds •Public Private Partnerships •Internship/Volunteer Programs •Contract Services •Service Levels •Changing Service Delivery Model 31 Potential Solutions (cont.) •Fees/Cost Recovery •Priority Based Budgeting •Competitive Purchasing •Municipal Code/Charter Updates •Cannabis Sales Tax Measure 32 Next Steps •Staff will continue refining the LTFP •April budget workshop (Date: TBD) with refined Fiscal Year 2018-2019 Baseline numbers •Development of the Fiscal Year 2018-19 Proposed Budget •LTFP will be presented with the Proposed Budget document in May 33 QUESTIONS? 34