HomeMy WebLinkAbout2010/10/05 Item 2
CITY COUNCIL
AGENDA STATEMENT
~ \ '-2:: CITY OF
.~ (HULA VISTA
October 5, 2010, Item~
ITEM TITLE:
REPORT ON THE CITY tvL".NAGER'S FISCAL YEAR 2011-
12 BUDGET BALANCING PLAN
CITY MANAGER #
CITY MANAGER 1- __
ASSISTANT CITY MANAGER S )
SUBMITTED BY:
REVIEWED BY:
4/5THS VOTE: YES D NO I X ,
SUMMARY
The Five- Year Financial Forecast, presented to Council at the August 17, 20 I 0 Council
meeting, indicates that the City's General Fund has a projected deficit of $12.5 million
for fiscal year 2011-12. Given the magnitude of the projected deficit, City management
has prepared a budget-balancing plan designed to address the budget deficit. Tonight's
report will provide an overview of the City Manager's plan to close the budget gap.
ENVIRONMENTAL REVIEW
The Environmental Review Coordinator has reviewed the proposed action for compliance
with the California Environmental Quality Act (CEQA) and has determined that the
activity is not a "Project" as defined under Section 15378 of the State CEQA Guidelines
because the action only involves fiscal issues which do not involve any commifment to
any specific project which may result in a potentially significant physical impact on the
environment; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines
the activity is not subject to CEQA.
RECOMMENDA TION
That Council hears the report on the City Manager's budget balancing plan for fiscal year
2011-12.
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OCTOBER 5, 2010, ItemL
Page 2 of 10
BOARDS/COMMISSION RECOMMENDA nON
Not Applicable.
DISCUSSION
The City of Chula Vista has experienced a significant reduction in revenues as a result of
the national economic recession and the significant slowdown in local development
activity. Since 2008, the City has experienced a decline across all major revenue sources
including:
. A 17% decrease in sales tax receipts
. An 18% drop in property tax receipts
. A drop of21 % in franchise fee revenues
. A 28% drop in Transient Occupancy Tax (TOT)
. A 14% drop in Motor Vehicle License Fees (MVLF)
. A 39% decline in development revenues.
[n total major discretionary revenucs in the General Fund have dropped from a high in
fiscal year 2007-08 of $97.1 million to an estimated $83.0 million for fiscal year 20 I O-
II, a loss of 15%.
In an effort to keep expenditures in line with declining revenues, the City Council has
approved several budget balancing plans. Due to the City Council's decisive actions to
reduce expenditures and the previous cooperation of the City's bargaining groups the
City has been able to end the last three fiscal years without impacting the General Fund
reserves. The Chula Vista Employees Association (CVEA), Western Council of
Engineers (WCE), and Chula Vista Mid Managers/Professional Association
(CVMM/PROFA) eliminated their salary increases and the International Association of
Fire Fighters (IAFF) and Police Officers Association (POA) deferred their scheduled
salary increases. This was a significant undertaking given the severity of the financial
issues facing Chula Vista.
Budget reductions have impacted the City's General Fund, Redevelopment (RDA) and
Housing funds, Fleet fund, and Development Services fund (OS F). -
Despite the reductions made in recent years, the City continues to struggle to keep
expenditures in line with revenues - the impacts of the economic recession continue to
deteriorate discretionary revenues. During fiscal year 2009-10, the City experienced a
drop in major revenues that created a structural imbalance in the City's General Fund.
The drop in revenues in fiscal year 2009-10 was mitigated through one-time- revenues and
further reductions in expcnditures. The structural imbalance identi fied in fiscal year
2009-10 carried forward and grew in fiscal year 20 I 0-11 as the city experienced
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OCTOBER 5, 2010, rtem~
Page 3 of 10
increases in cxpenditures and decreases in revenues. The fiscal year 20 [ 0-11 budget was
balanced by reducing expenditures by $1.3 million and the application 01' $9.6 million in
one-time revenues in order to close a budget deficit of $10.9 million. The use of one-
time solutions to balance the tiscal year 20 I 0-11 budget was identified as part of the City
Manager's proposed budget for fiscal year 2010-11, which was ultimately adopted by the
City Council.
The application of one-time revenues enabled the City to avoid additional service level
impacts and employee layoffs in the spring of 2010. In addition, the use of one-time
revenues afforded the City the opportunity to continue monitoring economic trends and to
come forward in the future with adjustments based on additional months of economic
data. While these solutions resulted in a balanced budget and minimal service impacts,
they did not resolve the underlying structural problem.
The projected General Fund deficit for fiscal year 2011-12 is $12.5 million.
The projected deficit of $12.5 million does not account for the potential loss of
Telecommunications Users' Tax revenues estimated at between $5 and $6 million
annually, should the November 20 I 0 ballot measure fail.
The following table is a summary of the General Fund forecast for fiscal year 2011-12 to
2014-15.
Table 1 - General Fund Forecast Summary
(in millions)
~~ "~~,;~; ',:, .:,:,1:'~~ ',.:,,~ ~i~>-~" It: .;~.
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Revenues $ 138.3 $
One- Time Revenues $ 2.2 $
Total Revenues $ 140.5 $
] 26.3
4.0
130.3
$ 123.6
$
$
9.6
133.2
$ 123.8 $
$ $
$ 123.8 $
127,1
$ $
$ $
$ 130.5 $
134.0
127.1
Expenditures
$(140.4) $(130.3) $(133.2) $(136.3) $(137.0) $(140.3) $(142.7)
Surplus/(Deficit)
$ 0.1 $
$
$ (12.5) $ (9.9) $ (9.8) $ (8.7)
Notes:
1. Expenditures include adjustments lO fimc! balance.
2. Voters will consider a measure updating the City's Telecommunications Users
Tax/Utility Users Tax (UUT) ordinance to reflect technological changes in the
telecommunications industry on the November 2010 ballor. The Five-Year Forecast
rejlecrs a conrinued collection of UUT revenue; should the measure filil the projected
deficit could grow by as much as 55.0 to 56.0 million annual(v (based on rhe wldired FY
2008-09 jinancial statemenrs).
3. One Time Revenues Utilized 10 Offser continuing decline in discretionwy revenues'
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OCTOBER 5, 2010, Item 2
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a. FV 2008-09 Increased RDA Reimbursement by $900,000 and reduced
conlribution to Warkers Camp Fund and Equip Replacement Fund.
b. FV 2009-1 0 Increased ROA Reimbursement by $2.0 million. Increased staff time
reimbursemellls by 52.0 million related to Prop B
c. FY 20lO-lllncreased ROA Reimbursement by 59.6 million as a result of PAD
land sale transaction.
The Five Year Financial Forecast report is available on the City's website at
ww\v.chulavista.gov
Given the sevcrity of the projected budget deficit, City management has taken the
following steps to address this critical issue:
I. Contracted Public Financial Management Group, an independent financial
advisory service, to review the assumptions used in developing the Five Year
Forecast.
2. Established a Financial Advisory Group largely made up of private sector
tinancial experts to .provide feedback in the budget process and other financial
matters.
3. Invited the City's bargaining groups to discuss changes iu compensation in order
to avoid layoffs.
4. Developed a budget-balancing plan that addresses the budget deficit of $12.5
million projected for fiscal year 2011-12.
Public Financial Management Group (PFMG) has been working over the last few weeks
to provide an independent review of the Five Year Financial Forecast. To date, 'PFMG
has not issued a final report on their review; however, preliminary discussions with
PFMG indicate that they have not identified any major tlaws in the assumptions used in
developing the Five Year Financial Forecast. The City has Dot received any new
information that would significantly impact the projected deficit for fiscal year 20 11-12.
As discussed in prior reports, the majority of the General Fund budget is dedicated to
Personnel Services. In fiscal year 2010-11, Personnel Services represents approximately
77% of the City's General Fund. As such, efforts to close the projected budget deficit by
reducing expenditures will undoubtedly impact Personnel Services. The options to
reduce personnel expenditures are to eliminate positions or to reduce personnel costs by
making adjustments to employee compensation. The City Manager has requested that the
bargaining groups work collaborativcly with the City in order to mitigate employee
layoffs. Barring concessions by the City's bargaining groups, the City will have no other
option but to close the budget gap by implementing the starting reductions outlined in the
budget-balancing plan outlined in the following section.
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OCTOBER 5, 2010, Item~
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BUDGET-BALANCING PLAN
The City's executive management team has worked collaboratively to develop a budget-
balancing plan for fiscal year 2011-12. At the outset of these discussions, management
decided to adjust the target amount by eliminating budgeted salary savings. Some
amount of anticipated salary savings has traditionally been assumed as part of the City's
budget. However, given the severity of the budget reductions and the small amount of
turnover the City has experienced in recent years, salary savings have been eliminated
fiOlll the fiscal year 2011-12 budget. The elimination of salary savings from the budget
increased the projected $12.5 million budget gap to $14.4 million.
The next decision made by the management team was the application of one-time
expenditure reductions and/or revenues to account for the drop in the projected deficit for
the General Fund from $12.5 million in fiscal year 2011-12 to $9.9 in fiscal year 2012-
13, for a difference of $2.6 million. In total, The City Manager's Budget Balancing Plan
assumes the application of $2.6 million in one-time expenditure reductions/revenues.
These one-time expenditure reductions and/or revenues will be realized via the early
implementation (January 2011) of the layoffs identified in the Budget Reduction Plan and
the pension pick up for unrepresented employees.
The remaining $11.8 million General Fund budget deficit will be addressed through
ongoing structural net cost reductions. The identification of one-time expenditure
reductions/revenues in the amount of $2.6 million ensures that the structural solutions
(many with service and staffing impacts) are limited to only the amount necessary to
resolve the ongoing structural deficit, as projected in the Five Year Financial Forecast
and reviewed by the independent financial advisor, PFM.
The table below summarizes the calculation of the total General Fund budget shortfall
and the application of both one-time and ongoing structural solutions, for a total Budget
Balancing Plan of$14.4 million.
~ '..=-
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General Fund Budget Shortfall
Estimated General Fund Deficit (Five-Year Financial Forecast)
Budgeted Salary Savings (2%)
Total General Fund Budget Shortfall
Fiscal Year 2011-12 Savings
Annual Value of City Manager's Budget Reduction Plan
(Includes $665,000 in pension payments by unrepresented employees)
$ 12,500,000
$ 1,900,000
$ 14,400,000
$ (11,840,000)
One Time Revenues! Loan Re ayments (to be identified)
Total Estimated FY 2011-12 Savings
Early Implementation (.January 2011)
Layoffs (ldentitied in City Manager's Budget Reduction Plan)'
Pension Pick Up - Unrepresented Employees'
$ 202,000)
S (12,042,000)
$ (2,023,000)
$ (335,000)
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OCTOBER 5, 2010, [te111~
Page 6 of 10
Total Estimated Early Implementation Savings $ (2,358,000)
Remaining General Fund Deficit $ -
JVotes:
1.
Value 0/ ear(v implementation a/layoffS identified in City Manager's Budget Balancillg
, plall is all estimate ollly. Actual value 0/ ear(v implementatioll of layoffs will vw:v based
on the value of leave balallce paYOlllS for illdividual employees alld illcreased
unemployment .insurance costs.
2. Total value of pellsioll pickup by unrepresented employees in the General Fund is $1
millioll. allfunds 51.3 million (Janual1' 2011-June 30,2012). In the table above, a total
of$665, 000 is accoullted/or ill the City kfanager's Reduction Plan alld $335,000 is
reflected in the early implementation category.
The following table summarizes the budget reduction plan by department.
Table 3 - Summary of Budget Reduction Plan by Department (Annual Ongoing Savings)
City Council 1,202,000 117,000 117,000 -9.73%
Boards & Commissions 15,000 4,000 4,000 -26.67%
City Clerk 884,000 98,000 5,000 (50,000) 52,000 -5.88%
City Attorney 1,964,000 207,000 207,000 -10.54%
Administration 1,352,000 125,000 67,000 (15,000) 177,000 -13.09%
ITS 2,352,000 71,000 107,000 178,000 -7.57%
I-Iuman Resources 2,025,000 84,000 42,000 126,000 -6.22%
Finance 1,979,000 198,000 4,000 202,000 -10.21%
Animal Care Facility 1,273,000 168,000 168,000 -13.20%
Development Services (GF) 1,236,000 493,000 159,000 149,000 802,000 -64.89%
Police 37,025,000 4,840,000 - (503,000) 4,337,000 -11.71%
Fire 20,899,000 2,126,000 22,000 (101,000) 2,047,000 -9.79%
Public Works 11,237,000 2,240,000 (77,000) (21,000) 2,141,000 -19.05%
Recreation 2,905,000 478,000 216,000 (56,000) 638,000 -21,96%
Library 4,491,000 283,000 368,000 (7,000) 644,000 -14.34%
General Fund Total 90,839,000 11 ,528,000 917,000 604,(00) 11,840,000 -13.03%
Notes:
1. Net cost has been adjusted tu eliminate citywide expenditures for liability insuro!1ce and
computer/software maintenance.
The reduction plan of $11.8 million translates into the elimination of 91 pOSitions. The
following tables summarize thc reductions by department and bargaining group.
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OCTOBER 5, 2010, ltem~
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Table 4 - Summary of Permanent Staffing Reductions by Department
Legislati vel Adm i n istra tive
City Council IS 00 -2.00 -13% 0.00 -2.00 -13%1
City Clerk 8.50 -2.00 -24% -1.00 -3.00 -350;'0
City Attorney 14.00 -3.00 -21% -1.00 -4.00 -29%)
Administration 21.00 -11.00 -52% -0.50 -11.50 -55%.
ITS 29.00 -10.00 -34%1 -1.00 -11.00 -38%
Human Resources 25.50 -8.75 -34~/o 0.00 -8.75 -34%1
Finance 31 00 -4.00 -B% -2.00 -6.00 -19%
Other Funds 0.50 1.00 'lO{)9~ 0.00 1.00 2000/0
Leg & Admin 144_50 -39.75 -280/0 -5.50 -45.25 -31.Yo
Development & Maintenance
Animal Care Facility 0.00 19.25 -2.50 16.75
Development Services (GF) 90.50 -63.50 -70~/o -3.00 -66.50 -73~'o
Community Development 26.00 -26.00 -100% 0.00 -26.00 -1000/0
Public "Vorks 186.50 6.00 39'0 -29.00 -23.00 -12%
Engineering 51.00 -51.00 -100% 0.00 -51.00 -100%
Genera! Services 104.75 -104.75 -100% 0.00 -]04.75 -1000;0
Otner Funds 14.00 99.00 707% 0.00 99.00 707%
Dev & Maint 472. 75 -121.00 _26O/,) -34.50 -155.50 -330/0
Public Safety
Fire (excluding dispatch) 140.00 -5.00 -4% -5.00 -10.00 -7%
Fire Dispatch 11.00 -11.00 -100% 0.00 -11.00 -100%
Police (less CBAG) 364.50 -43.00 -12% -.18.00 -81.00 -22%
CBAG 17.00 1.00 6% 0.00 0.00 6%
Other Funds 0.00 26.00 0.00 26.00
Public Safety 532.5 -50.00 -90/0 -43.00 -93.00 -170/0
Culture and Leisure
Recreation .14.00 -8.00 -24% -2.00 -10.00 -29%.
'ature Center 9.25 -9.25 -100% 0.00 ~9.15 -100%
Library 70.75 -31.00 -44% -6.00 -37.00 -52%
Culture and Leisure 114.00 -48.25 -420/0 -8.00 -56.25 -490,1;.
General Fund Total 1.249.25 -385.00 -310/0 -91.00 -476.00 -380/0
Other Funds 14.50 126.00 8690/0 0.00 126.00 8690lcl
All Funds Total 1,263.75 -259.00 -20~. -91.00 -350.00 -28U/o
Notes:
1. Since fiscal ~vear 2006-07, (1 number of positions were transferred from the General
Fund to their re:-,pective funding source. For example. Development Services stqf]ing
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OCTOBER 5, 2010, Item~
Page 8 of 10
previous(v ;,u:/llded in the Planning and Building Department is now included in the
Development Services Fund.
2. CBAG staffing was included in the General Fund in fiscal year 2006-07 but was
subsequentlv transferred to the Police Grants Fund thus the Changes to Date column
reflects the transfer orCRAG to Other Funds.
3. Fire dispatch services are naw pruvide on a contractual basis by the City of San
Diego.
4. The table above reflects permanent positions only; hourly staffing has been reduced
by over 50% when comparing fiscal year 2006-07 to fiscal year 2010-11.
Table 5 - Summary of Staffing Reductions by Bargaining Group
MidMgrs/Prof 149.50 -57.50 -38% -2.50 -60.00 -40%
Senior Mgrs 48.00 -17.00 -35% -2.00 -19.00 -40%
Executives 25.00 -9.00 -36% 0.00 -9.00 -36%
CV Employee Association 609.25 -162.75 -27% -49.50 -212.25 -350/0
Western Council of Engineers 37.00 -10.00 -27% 0.00 -10.00 -27%
Police Officers Assoc. 247.00 -11.00 -4% -34.00 -45.00 -18%
Confidential 31.00 -3.75 -120/0 0.00 -3.75 -120/0
Mayor & Council 5.00 0.00 0% 0.00 0.00 0%
IntI. Assoc. of Fire Fi"hters 112.00 12.00 11% -3.00 9.00 8%
All Funds Total ],263.75 -259.00 -20(~) -9I.OO -350.50 -28%
Notes:
o
JHM/Prof refleels Mid Afanagers and Professional positions that are represented by
the Clwla Vista Afid JHanagers/Professional Association and the AlM/Pmf positions
that are not represented by the Chula Vista Mid Managers/Professional Association
- for fiscal year 2010-11 the represented group totals 66.0 FTE and the nOIl-
represented group totals 2ri.O FTE. The non-represented positions include
cOllfidential or unclassified positiolls.
City Cuuncil, Executives, Senior .Alanagers, Conjidential, and nOll-represented
A/iVl/PROF groups will begin contributing 8% tmvards their pension costs in Januar;1/
2011. Public Safety employees ill these groups will cOlltribute 9%. The cost savillgs
generated fi'om employees paying their share of pension costs v1:'ere sufficient to
elimillate the proposed layoffs withill these ,}'oups.
~Historic net increase of 12 FTEs to L4FF bargaining unit is the result (~f the
elimination nf 1 FTE (Trainillg Fire Captain) and the transfer of /3 FTEsFom other
hCll'gaining units to L4FF (6 Battaliun Chief' transferred Fom the Mid Mallagers
group, 6 Fire Preventioll staff members transferred from CVEA and / Fire
Prevention Engineer transferred Fom the Professiollal group). Excluding the 13
FTEs tran~ferred tu lAFF would result ill a net reductioll of 1 PTE, a reduetiull of
1%.
1.
3.
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OCTOBER 5, 2010, Item 1-_
Page 9 of] 0
In total 91.0 positions will be eliminated in order to close the budget deficit. Of these
91.0 positions, 19.5 positions are vacant and 71.5 positions would result in layoffs.
The fiscal year 2011-] 2 budget represents the fifth consecutive proposed budget that has
included budget reductions. Allocating reductions has become more challenging with
each progressive budget reduction process. For the Clm-ent budget-balancing plan, staff
considered several options for allocating target reductions and selected to prepare the
budget reduction plan based on a net costs basis. Some consideration was given to the
support departments when allocating the reductions as past budget processes have
reduced staffing to a level where additional staffing reductions would severely impact the
departments' ability to continue to provide even basic se.rvices.
Telecommunications Users Tax
Due to the legal risks surrounding the City's Telecommunications Users Tax, a ballot
initiative has been approved by the City Council that will modemize the
Telecommunications Users Tax Ordinance and secure approximately $5.0 to $6.0 million
in existing revenues annually. If the ballot initiative fails, additional cuts have been
identified and will be brought forward for Council consideration as part of balancing
fiscal year 2011-12.
Applying an average personnel cost of$] 11,000 per full time equivalent (FTE), a general
estimate of the number of personnel reductions that would be necessary to address this
additional budget deticit has been calculated. If the entire $6.0 million budget deficit
were addressed through personnel reductions, this would result in the elimination of
approximately 54.0 FTEs in addition to the reductions oLltlined above. Currently, the
budget reflects a total of 864.25 FTE's in the General Fund. Combined with the staffing
reductions of91.0 FTE outlined in the previoLls section, the City could eliminate as many
as 145 positions or approximately 17% of General Fund staffing.
Combined with the stafting reductions of 259.0 implemented to date, the total staffing
reduction will be 404.0. This would equate to a 32% reduction in citywide statting since
fiscal year 2006-07.
Summary
The City has faced budget challenges since 2007. Budget reductions approved to date
have helped stabilize General Fund reserves but the impact of the economic recession
continues to be felt in City revenues. Since fiscal year 2008, discretionary revenues have
dropped by 15%, approximately $14.1 million. At the same time personnel expenditures
have continued to clif!1b. The Five Year Forecast projects a $12.5 million deficit for
fiscal year 2011-12. The City's management team has put together a plan to address the
projected deficit. Implementation of this plan will commence in January 2011 in order to
generate one-time savings in the current fiscal year that can be used to close the deficit in
the coming fiscal year. These reductions wiil impact all departments and all bargaining
groups.
2-9
OCTOBER 5, 2010, Item~
Page 10 of 10
The City Council, Executives, Senior Managers, Confidential and non-represented Mid
Managers/Professionals will contribute 8% of their salaries towards their pension costs.
The contribution amount will be 9% for Public Safety employees in this group. The
reduced pension costs resulting from this change helped mitigate layoffs. The City can
balance the projected budget deticit of$12.5 million ifall of the City's bargaining groups
agree to pay their share of pension costs and forego scheduled cost of living increases.
City management recognizes that this change requires personal sacrifice on the part of
our staff, unfortunately, the alternatives to close the budget deticit are limited. I f the
requested concessions are not received from the City's bargaining units 91.0 positions
will be eliminated, of these positions only 19.5 positions are currently vacant. With the
number of positions eliminated in previous years, further staffing reductions would result
in a significant degradation in City services. Simply put, this comes down to a
choice: eliminate future raises ami reduce retirement contributions or cut public services.
City management will continue to reach out to the City's bargaining groups.
As noted above, the projected budget deficit for fiscal year 20 11-12 could grow by $5.0
to $6.0 million should the UUT ballot measure fail and will result in the elimination of
approximately 54.0 additional positions and the corresponding service impacts.
DECISlON MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is
not site specitic and consequently the 500 foot rule found in California Code of
Regulations section 18704.2( a)( I) is not appl icable to this decision.
CURRENT YEAR FISCAL IMPACT
There is no impact in the current fiscal year as a result of accepting the report.
ONGOING FISCAL IMPACT
The City is facing a projected budget deficit of $12.5 million in fiscal year 2011-12 and
an ongoing structural deficit of approximately $10.0 million. The adopted budget for
tiscal year 20 I 0-11 included $1.3 million in expenditure reductions and the application of
$9.6 million in one-time revenues, resulted in a balanced budget. However, these
solutions did not resolve the structural deficit in the General Fund. The City Manager's
Budget Balancing Plan seeks to address the deticit projected for fiscal year 2011-12.
Implementation of the plan will result in the elimination of91.0 positions.
The projected budget deficit for fiscal year 2011-12 could grow by $5.0 to $6.0 million
should the UUT ballot measure fail and will result in the elimination of approximately
54.0 additional positions.
Prepared by: A/aria Kachadoorian, Finance Director, Finance Department
2-10
~\~
~
~~~
Councilmember Steve Castaneda
City Of Chula Vista
276 Fourth Avenue
Chula Vista, Ca 91910
619.691.5044 - 619.476.5379 Fax
MEMO
CllY OF
CHUIA VISfA
m!lfti~~~~:l:~~~~~~K~~
DATE: Tuesday, October 5,2010
FROM:
Mayor and City Councilmembers ~'
Councilmembers Steve castan~ Rudy Ram~'
City Manager, City Attorney, City Clerk
TO:
cc:
RE:
FY2011/2012 Budget Balancing Plan
1'I:*~";~',*":-'~iI!.'~V.f;.,,:,~,,(;;;<tIii\fi~;;';.i<~'1.."-"~:!'!iN'i-:~i~ii.~;';W~~
Councilmember Ramirez and I continue to be concerned about the financial situation in
which we find the City of Chula Vista. We agree that a budget hole of $12.5 million
must be reconciled. However, we are concerned about the limited approach that is
being used to address the necessary cuts in spending needed to close the gap.
We would like to offer some recommendations on how we can work with City staff to
address the problems. We have agreed that we need to broaden the scope of
deliberations to yield the best solutions.
We deeply respect and are grateful to the City Councilmembers, the City Manager, the
City Attorney, the City Clerk, and employees in the Executive, Senior Manager, Mid-
Manager Unclassified, Mid-Manager Confidential, Professional Unclassified,
Professional Confidential and Confidential employee groups for their willingness to
embrace necessary pension reform by sharing their pension costs with the City.
Pension reform is only a portion of the solution to the $12.5 million deficit we face. We
therefore offer the following specific recommendations to our colleagues for
consideration:
1.) We ask the City Manager to roll back all raises or ongoing enhancements to pay
in the last three years to all unrepresented employees including step increases,
2,) We request that the City Council undertake a department by department budget
review to determine the appropriate staffing levels for each.
3.) We request further review of consolidation of existing departments to reduce
expenditures for managerial positions.
4.) We request a comprehensive analysis of opportunities to consolidate department
operations into available City facilities which will yield excess capacity with the
potential to be leased to outside entities.
5.) We wholeheartedly support comprehensive pension reform for all City
employees.
The foregoing represents the bulk of our suggestions, though the list is not exhaustive.
We hope that these suggestions will lead to robust and comprehensive discussion of
where to make cuts in advance of negotiations with the City's bargaining units. Thank
you.
"" ~ " - '" "H., 4".....
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Adopted in January 2009
Includes four major components:
- Expenditure Cuts: budget reduction plan, operational reviews,
STARS program, pension reform, volunteer/intern program,
Goodrich LEAN program
- Increase/Protect Revenues: fee review, grant funds, contract
review, new partnerships, UUT ballot measure, improve sales tax
revenue
Economic Development & Job Creation: University/Tech park,
Western CV revitalization, Millenia, bayfront, small business
assistance, development and diversification of revenue
Budget Reforms: fiscal impact review, department analysts, debt
restructuring, fiscal policies, zero-based budget, financial forecast,
long term financial plan, increased transparency, finance advisory
commjttee
#c9-,
Revenues:
. Slow Economic Recovery
RDA loan repayments to General Fund averaging $1.5
million annually
No revenues from South Bay Power Plant assumed
. Assumes continued collection of Utility Users' Tax (UUT)
revenues, including Telecommunications Users' Tax (TUT)
Expenditures
. 2% Attrition Factor
. No funding for vacant positions
. Health care increases of 10% per year
No salary increases beyond existing MOU agreements
. Does not include potential CVEA MOU increases
2
$ 1383 $ 126.3 $ 123.6 $ 123.8 S 1271 $ 130.5 $ 134.0
One-Time Revenues $ 2.2 $ 4.0 $ 9.6 $ $ $ $
Total Revenues $ 140.5 $ 130.3 $ 133.2 $ 123.8 $ 1271 $ 130.5 $ 134.0
Expenditures $ (140.4) $ (130.3) $ (133.2) $ (136.3) $ (1370) $ (140.3) $ (142.7)
Surplus/(Deficit) $ 0.1 $ S S (12.5) $ (99) $ (9.8) S (8.7)
Notes'
Pt~jeded deftclt" based on foreca5!edfigure.lorfiscalyear2011 12;1110 proie~"'d d~r.citwill be refine<i when tho be5" budgel for ft,cal year 2011_
12 is d~v~loped later lh,; year, whFeh wdllndude updated revenue and expenditur~ projeClions end edj"~tments for PERS contributions and FLEX
cDolli wtllclo ale nolknowTl "tthl~bm~
Pos,llUtls Ih~l are Iro/en In lh~ current year budget are assumed to be frozen for Il1e remainder 01 the fo'cc"st period The elimination of tile',,,
~aG"nt and non fimd~d po.illons re5ults in no budgeta'Y5evillgs
(ln~ Tlml" Rcwmu']s Utlll""d to Offset contmuing deelin" m discrdionary r~Yenu"'s
FY 200~ 09 Increascd RDA Reimbursement by $900 000 drJd r"duced ~ontribution to Wor""rs Comp FunJ and Eqwl-offl"nt ReF'/acem~nt
Fund (~s report",,, In th", Quart",r/y FmanGlal Reports fM FY 200B 09)
FY 2009.10 Incre;'sed RDA R""mbur,emeflj by $2.0 million. increased otdfftime falmbursem",nts by $2 0 mil/,on related to Prop B Id5
I~ported in r!J~ Qu~,t"rly rmancral Reports fur FY 2009 10)
FY 201O-11/ncreas~d ROt., RSlmbur~ement by $Y.6 m as a resuitof PAD iand sa/~ tranodclion (;'s "pprov~d by City Council and mcluded In
theCounelIAd"olerlBudgel)
$145.0
$140.0
$135.0
$130.0 ~
$125.0
$120.0
$115.0
$110.0
FY2010
FY2011
FY2012
FY2013
FY2014
FY2015
~Expenditures -6-Revenues ~Revenues (less telecommunications users tax)
Notes.
Th~ drop in 'eV~flue from FY2011 to FY2012 I~fgely consists 01 the e1iminalion of one-t""e revenll~ of $9 fi mLlhorl used 10 balonce FY2011.
2. The projected Gen~ral Fund deficit is projected to decrease by $2.6 mmion lrom FY20t2 to FY2013, lrom S12,5M to S9,9M.
3 Rev~nu~s (I~<, td~c~mmw"catlo'" users t~'1 rerrp"eots the 10.. ~f S5.6 million nnllunlly ill revenue., should the telecommWlicatio,,' u.~rs t~<
ballut nl~d'",e fall: th~ p'~I~el~d gap lor FY2012 grows trom $t2.5M to $18,1M without thl5 revenue, Potellli"lloo" ul t~lecommu!lic",liMS 15
rdcck(j nt FYfO ocb,als (U<laud~ed), actual f~venue In,~ will depend on Camers alld currelll (.olllract.
3
Since 2008, the City has experienced a decline of
EJjJ 18% Property Tax Receipts
!;;m 17% Sales Tax Receipts
!!Ill 21 % Franchise Fee Revenues
!!Ill 28% Transient Occupancy Tax (TOT)
!!Ill 14% Motor Vehicle License Fees (MVLF)
!'Ii 39% Development Revenues
!!Ill A total General Fund major discretionary revenue loss
from a high in fiscal year 2007-08 of $97.1 million to the
City's estimated receipts for fiscal year 2010-11 of $83.0
million, a total loss of 15%.
Imperial Beach $23 .
San Diego County $37 .
Oceanside $78
Coronado $80
Chula Vista $93
Vista $106
Santee $112
Lemon Grove $116
San Diego $124
Encinitas$131
San Marcos $134
Escondida $138 .
La Mesa $151
EI Cajon $156
Solana Beach $169
poway $170
National City $182
Carlsbad $191
Del Mar $254
General Retail
CConstruction
Ct::l
ca.
=11EI-_
lB'
=CJ:I
=..... lIB I I
c,"'~:":::-_ I County Average: $130
",.,. ,"'=- I
= .~~~-~
C=:::::~A~
C::::C::1:::r::=
~"""";""'...",...,.........a_ '
~ :.
c:::::;F..........o....;."..,........... :_
r.....".......::::::IlIliII::_
~.~~;;;.:::_:-
..._..........~~
L..-. . m!I_ =:J
$-
$50 $100 $150
!;) Food Products
. Business To Business
$200 $250
D Transportation
D Miscellaneous
$300
4
8.00%
6.00%
4.00%
2.00%
0.00%
200%
4000,{,
-6.00%
8.00%
10.00%
-1iJ-~
-;=~_IILIL"L", (;]
~-I-.-IFJEI3IjI~I:I:1
o ,:,.0 .q.'l>
o 0" 0' '00 6''<> 6:(} ,,0 ~,
12 00% 'I " 4' 0"" i}0 ,0 0'" O?0 0'" ,0; &~ /3 -!;0
0' .' ,0" ~~ cpO ~0 ~ --\' "F '" _," ,p OV"-,, ,,'I <7
$"'&0#0' '0. ~
0" 0''10 0'" 'I vY 0,00 0 v .;,.'ii' ,,,0
G ~"l>0
0,'1
\""SfJfsufficc
County,,! San Diego [~~cs, ,
S"UfCC::
400'1
'-lI
20U% "
100% """"'_ _ _ -II
0,00% - - lEI [jJ III
I-I-I-I-I-I-I~I I~~~
-100%
200%
-300%
-400'10
-500% 0. 'Z> G>0 #
(J '1>-'\ '1J.<' (:.,'::>;0 >;)~ ..J;-",c.; ,,0' ...0.'
~3\ 3~:P 0'1' oiii ,<!' <)' J'" ,,'3 ,,0
Qi 0<:' 0 <( v./j 0'3<:' (; ~'IY
Q (..0 2;-'1'<:<'3
o
0<' ;::,0 d'" ...o."?
c -r;,<:- ,;J' F,/"c ~u ~o~ 0~ ,~'!>
,0 00"; ",<20 A<:' _,,'I' c,o <:< ~
~ v '" "" /.'" 1$"0 (,'<:'
0'3 0- ,.,<:<0/ Od) 0'1><:' v ,,'"
"'....,Q
-. \ "S~(HS ufficc
S"urcc: (hunt) ,,[S'111 thl'W' 1 ~~l"
5
ASSESSED VALUATION ADJUSTMENTS
DRIVEN BY CHANGES IN THE CPI
15%
-Assessed Valuation Increase
-Calif.CPI
5%
2.0
0%
-5%
"":.:,>.>?'>"":, -:'",.;0;,"'7<9-,<<,,, i>{;> "'if"", 1-<& f~"b''%&/'>19 "b",,, ..",'\'0 "':~ ""~'~\:'r"''''t-~'* *% "b,,-,.9""b ""''\j, "'\,""<:'''''''<' 10".;'-~ "''/r'J-<b''o;"/'''-q,, ~"C.Jl0 :";,
FISCAL YEAR
20.0%
15.0%
10.0%
5.0%
0.0%
~I~
-5.0%
-10.0%
-15.0%
-20.0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
6
,rt:!,~~1!D!B~tclji'0iiiiiii?l:)" ,
Property Tax 78% 0,2% 135% 4.9% 0,9% 39% 3 8% 40%
Sales T", 0,1% -9.6% -92',~ 1.7% 2.0% 3,0% 3,0% 3,0%
Franchi~e Fees ~ " 8% -2,9% -10,0% -9.4% 1.9% 1.9% 1,9% 1.9%
M"'-F 5,9% 05% ~ 11 0% -44% 20% 39% 3,9% 3,9%
UtJlltyUsers To, 7,7% 6.4% 19,8% -6.9% 0 5% 05% 0 5% 0 5%
TOT .2.5% 146% 15.7% 0,0% 2.0% 2,0% 2 0% 2 0%
Notes'
For fiscal year 200910 and fiscal year 2010 11, Property Tax and Motor Vehicle License Fee
change reflects drop In Assessed Values per County of San Diego - Assessors Office
2 For fiscal year 2009.10 and fiscal year 2010 11, Sales Tax change leffects continued Impacts
related to recent economIc downturn. This IS based on mosl recent report from MuniSeNices 3rd
quarter update
3. Franchise Fees and UUT antiCipate closure of South Bay Power Plant In Fiscal Year 2011
Personnel Services
$82 OM
617%
Pension Cost
(Employer Share)
$15.8M
1190/:....-//
Pension Cost
(Employee Share)
~ $52M
3.9%
~
~
Supplies &
Services
$14.3M
10.8%
'~
Other Expenses
$O.7M
0,5%
Operating
Expenses $0.1 M
0.1%
Utilities S5.2M
3.9%
$1,OM
08%
'.............. Debt Service!
.....'- Transfers Out
$8.7M
6.5%
7
. Personnel Services increase of $3.4 million (3.2%)
includes:
- $1.2 million for POA and IAFF cost of living adjustments
- $0.9 million for flex cost increases
- $1.3 million for PERS cost increases, step increases,
increased overtime costs, and other miscellaneous
changes
. Supplies & Services increase of $0.3 million
(2.0%)
. Utilities increase of $0.3 million (5.0%)
. No General Fund CIP expenditures included in
FY12
General Fund Expenditures
Program Revenue
Net Cost
Excluded Non Dept Expenditures
Adjusted Budget
$ 133.2
$ 31.1
$ 102.1
$ (11.3)
$ 90.8
Note: Non Departmental expenditures include debt service, insurance
premiums, public liability expenditures, and computer hardware and software
expenses
8
41%
3%
0, ~"" _____________Human RpsourGes
"i $35M'%
" / Flnanc~$20M
( 2%
Dev Services (Gen Fund) Animal Care Facility
$1.2M 1% S1.3M 1%
9
. Review the assumptions and calculations in the 5~Year
Financial Forecast
. Evaluate the reasonableness of the projections and identify
risks to the forecast
The City's assumptions appear reasonable and the
underlying calculations are generally accurate
. The City's revenues (like most local governments) are
highly variable and there is a potential for higher or lower
revenues and costs
10
:~;+'';:: "f~; ~ "~'\F~'-" ~Fl"~ 0 l'..,.. ~}'1::;:.,..]:,~Al:)'.....,'t_, ~''''<- "
,,";I ... ;:fi.: p tfi" it; , ' -<h~.~',~'.."n ~v , .
i< ,'Jt~su1ts"qf th~'l;l,"e~ (b'~nt:); ,
".t, ~? lj';"/i's 1 ":~.:: ."., '.~ "'4b!" ~,/'':e~ ~ ..~, ". "t"
. f> t' "'" ", x _ ' i"...,
Certain assumptions may be overly conservative
However, changes in these assumptions do not
significantly impact the forecast
,~.~_. '.P~'~stbi{" ~l.ta~~.~~~~~ P""
'.!__CIYT 'V'," ..,...", "'1;.";;1.,': "~'''''+~ 'l0;:;'~ 'IV', .
D'RM it ,f ;, I '~Ii ~;''?j 1:11"'; ",.1i'\" "' ,
J" ~ II 'f" ~ , . i, . '\ , ~ i A
. UUT and franchise fees: South Bay Power Plant continues
to operate (+570K)
. EUC: additional TOT, VLF, and property and sales tax if
building occurs (+1.5M)
11
. Development revenue: resumption in building activity could
generate significant service fee revenue
. Sales tax: economists predict an upswing, but their
forecasts are not reliable
. UUT (TUT): failure to pass modernization ordinance could
result in falloff of revenue (-$5.0M)
. Debt Service: payments starting FY 2013/14 rely on
resumption of PFDIF revenue (-$6.0M)
12
. PERS: Contributions in FY 2013/14 and 2014/15 are
dependent on investment returns (+3.8M)
. PERS: Changes to "smoothing" or GASB rules could
substantially increase contributions
:.I" " .', ,;;:,,~, ' " "( . :- . - ':. "i. ,~;~
?""''l< ' +' '>, . t '" ", " ' 'i
f'~' ',....' IOtt::-t~~ Risk Mal~sj;~) . ~~.~~.
""""-,,,,,. ~,.. '" _' 1. "" ( ~ ~ 'h , ... ~ ~ ,,',.. ;1%.
3O'R.IA .';1" . ~ .., _ _'"
, . ," '" " " '; r "",' ~ " 'i, ~ ' , " 3 "
_JII1_
. , .. '> -'l'~r...,,'t~,*,~~j,.'!;~"'.: ~ .,;
Revenues
Expenditures
Surplus/(Deficit)
$1238
(136.3)
($12.5)
[;~~~~~IA~=:~'
Revenues
Expenditures
Surplus/(Deficit)
ilFY 2011:12 i
IL(~iIliOnS)J
$124.8
(136.3)
($11.5)
: Financial Advisor's
LI:::ssimisti~?c':.~.!3'rio
Revenues
Expenditures
Surplusf(Deficit}
i FY 2011-121
UIlJ1~.!.!.~.?~l:>LJ
$121.8
(136.6)
($14.7)
13
. The City's projected fiscal results appear reasonable
Actual revenues and expenditures could differ, but would
not materially change the projected deficit for FY 2011/12
. The forecast could be much different depending on
building activity, UUT (TUT) vote, and PERS investment
earnings
14
Library 9,964,000 (5,571,000) -56% 70.75 (31.00) -44%
Recreation! Nature Center 7,432,000 (3,251,000) -44% 43.25 (17.25) -40%
Legislative! Admin 21,675,000 (5,129,000) -24% 144.50 (39.75) -28%
Devl Maintenance 56,755,000 (11,135,000) -20% 472.75 (121.00) -26%
Police 50,351,000 (2,365,000) -5% 381.50 (34.00) -9%
Fire (Excluding DispatCh) 22,071,000 (656,000) ~3% 140.00 (5.00) -4%
Service Transfers
Fire Dispatch~ 1,158,000 (698,000) -60% 11.00 (11.00) -100%
Total 169,406,000 (28,805,000) -17% 1,263.75 (259.00) -20%
COLA Eliminations (8,820,715)
Total Personnel Cuts (37,625,715)
~Fir,-" /)i.lpalch .\crl'ice.\' nulJ' proFided \'io cOIilrUCllt'lIh ('iIY ,~.f SUII J.liegn, wilh no redllcl/Oll lIl.\'en'ICC !en'ls
Estimated General Fund Deficit (Five-Year Financial Forecast)
Budgeted Salary Savings (2%)
Total General Fund Budget Shortfall
Early Implementation (January 2011)
Pension PIC!<, Up - Unrepresented Employees'
Layoffs (Identified in Budget Reduction Plan)2
Hourly Wage Reductions (Identified in Budget Reduction Plan)
Total Estimated Early Implementation Savings
$ 12.5
$ 19
$ 14.4
$ (0.7)
$ (09)
$ (1.6)
$ (8.6)
$(11,8)
$ (03)
S (2.0)
S (0.2)
$ (2.6)
S
City Manager's Budget Reduction Plan (Annual Value)
Cuts Implemented to Date
Pension Pick Up - Unrepresented Employees1
Vacancies (all bargaining groups)
Non-Personnel Expenditure Reductions! New Revenues
Cuts to be Implemented
Total City Manager's Budget Reduction Plan
Remaining General Fund Deficit
'1,)/,11 mille ,!IIIJlrel"t",,'cmed clllf'l"rcc 1"'II.\'WIII'lck "I' (..". I,} !(jII/l1mllg" I'} ,'Ol! '.I' SI.OO,J,()(j(l
/"t1,W .!I"IlI"h' iilll,h''''''fII"lio'' of 1"-,,,,1/., idcwifh'd ill Cil, M"""ga'.1 /llId~d IIcdlldi"" I'la" iI' WI ",li"'<lI,' o"ll' .-ldu,,1 m/", "I
<'d/'(\' /I"I''''IIICIII''IIO/I or "ll'o1fs '1'//1 mn' "",cd ,lII lhe \',,111<' or h',,,,t' ""Iwie,' l',n'ollls (.Jr mdmdual I''''I,lm'''I"'' "nd me/nlh'.!
""'."1111,10\11"."111;/1.1"",",:,-",,-,1.\
15
Development Svcs (GF) 1,236.000 493.000 159,000 149,000 802,000 -64.89%
Boards & Commissions 15,000 4,000 4,000 -26.67%
Recreation 2,905,000 478,000 216,000 (56,000) 638,000 -21.96%
Public Works 11,237,000 2,240,000 (77,000) (21,000) 2,141,000 -19.05%
Library 4,491,000 283,000 368,000 (7,000) 644,000 -14.34%
Animal Care Facility 1,273,000 168,000 168,000 13.20%
Administration 1,352,000 125,000 67,000 (15,000) 177,000 -13.09%
Police 37,025,000 4,840,000 (503,000) 4,337,000 -11.71%
City Attorney 1,964,000 207,000 207,000 -10.54%
Finance 1,979,000 198,000 4,000 202,000 1021%
Fire 20,899,000 2,126,000 22,000 (101.000) 2,047,000 -9.79%
City Council 1,202,000 117,000 117,000 -973%
ITS 2,352,000 71,000 107,000 178,000 -7.57%
Human Resources 2,025,000 84,000 42,000 126,000 -6.22%
City Clerk 884,000 98,000 5,000 (50,000) 52,000 -5.88%
General Fund Total 90,839,000 11,528,000 917,000 (604,000) 11,840,000 -13.03%
City Council 13.00 0%
City Clerk 6.50 (1.00) (1.00) -15%
City Attorney 11.00 (1.00) (1.00) -9%
Administration 10.00 (050) (0.50) -5%
ITS 19.00 (1.00) (1.00) -5%
Hurnan Resources 16.75 0%
Finance 27.00 (1.00) (1.00) (2.00) -7%
Animal Care Facility 1925 (2.50) (2.50) 13%
Development Services (GF) 2700 (2.00) (1.00) (3.00) 11%
Police 321.50 (1.00) (37.00) (38.00) -12%
Fire 135.00 (5.00) (500) -4%
Public Works 192.50 (9.00) (20.00) (29.00) -15%
Recreation 26.00 (1.00) (1.00) (2.00) -8%
Library 39.75 (3.50) (2.50) (600) -15%
General Fund Total 864.25 (19.50) (71.50) (91,00) -11%
Other Funds 140.50 0%
All Funds Total 1,004.75 (19.50) (71.50) (91.00) -9%
16
Library 70.75 (31.00) -44% (6.00) (37.00) -52%
Recreationl Nature Center 43.25 (17.25) -40% (2.00) (19.25) -45%
Legislativel Admin 144.50 (39.75) -28% (5,50) (45.25) -31%
Devl Maintenance 472 75 (121.00) -26% (34.50) (155.50) -33%
Police 381.50 (34.00) 9% (3800) (72.00) _1901<,
Fire (Excluding Dispatch) 140.00 (5.00) -4% (500) (10.00) _7O/',
Service Transfers
Fire Dispatch~ 11.00 (11.00) -100% (1100) -100%
Total 1,263,75 (259,00) -20% (91.00) (350.00) -28%
*Fir,' /.Ij"l'lIlell ,len'I('C,\ !lOW pro"lded l'/a ""nll"O<,1 wilh Ci(r (:(S<llIlJi"gv, 11'//11 110 redllction il/seHiee {en,ls
Unrepresented 669,000 271,000 27,000 967,000 335,000 13,000 348,000
CVEA 518,000 2,636,000 3,154,000 894,000 894,000
MM/PROF 162,000 51,000 213,000 19,000 19,000
IAFF 1,247,000 429,000 1,676,000 50,000 50,000
POA 156,000 3,160,000 3,316,000 1,047,000 1,047,000
WeE 124,000 124,000
Total 2,203,000 946,000 6,304,000 9,452,000 335,000 2,023,000 2,358,000
Personnel Expenditures, Not BU Speclflc~ 775,000 202,000
Non Personnel Expendituresl New Revenues 1,613,000
Total Guts 11,840,000 2,560,000
Budget Reduction Plan + Early Implementation 14,400,000
*/'<'I"""II//,'{ <'.If'~'lIdilllr<,\ 11,,1 (I,I.ligl/uhle III a .If'~''''liL' Iwr).;"illlll).; IIl1illlle/lld" IlOurfl' 1<0).;('.1. .Ialil/I' ,lill'lI1g', and
Ir<lln/;'rs '~(""!lflr<111/ Ih" (;"lIeml FUlld 10 other limd.,
17
. Elimination of dedicated City graphic & web design and
marketing capability
. Elimination of passport services
. City Clerk's Office will reduce public hours by approx 50%
. Delays in processing payments and researching liens
. Reduced Finance front counter hours
. Increased dependence on online resources to
communicate with employees
No advertisement of vacancies
. Delays in updating City's website
. Increased demand for services due to administrative &
clerical cuts in operating departments
18
. "~-, ~'*<fi'" '" ~ "~;{0;'~' ,,,, .~, t'.J ~"'/t'''''" ",:Y"'P .
~,~.l;'iii'i '\' ~ 1 ...."..) ,,,,, . .,' ~,- 1';:; \j;,# 10 \, <<
~"'I!III:i.eve;"~ '"h1il\il; &.Maintenati€tt~;~
t." cnYlj( ",., {'" . '~I,j~ ~,"" ~ ~,,.. 'J "'J.'" ''',,( ~ 4;.-
;4~ .."'_ "'''-;'1 ",0, ": /":~ '- ~,,' ~''l; 1''t',.,
t . ,<, ~ ~ _ '. ,"- . "Ji _ "';" _'
. Discontinued support of the Otay Valley Regional Park
(OVRP)
. Elimination of the entire Park Ranger Program
. Elimination of all customer support for the Park
Reservation Program
. Elimination of support for Starlight Parade lighting
. Elimination of the graffiti abatement crews
. Reduce Urban Forestry services funding by 38%
~I]
"~47:-~
. Arson Investigations Program
- Reduced investigation capabilities
- Elimination of Arson K-9
- Delay of fire investigations; not all fires will be investigated
Fire Safety Engineering Program
Impacts to fife and life safety plan review & building permit plan review; no
local control/oversight
Outsourcing services would result in potential additional cost to developers
. Fire Inspections Program
- Delays in code compliance for business inspections
- Delays in permit issuance and business license inspections
- Elimination of Weed abatement and Wildland Urban Interface enforcement
. Public Education
- All public education will be ellmlnated
19
. Elimination of School Resource Officer (SRO) Program
- Transfers 2,600 calls for service (school generated) and 14,000 officer
generated contacts to Patrol
- Will negatively impact GMOC response thresholds - Priority 2 threshold
has not been met since 1996
- Shifts coordination of 1,800 School Safety Patrol children to school staff
. 50% reduction in Street Team staffing
- Reduces proactive enforcement of high activity areas, crime series and
gang enforcement
. 17% reduction in Investigations staffing
- Increase in case load by 67% for Property Crimes
- Increase caseload and delays in investigative follow up by Famlly
Protection Unit investigators for domestic violence, child abuse and sex
crime cases
. Reduction in traffic enforcement staffing
- Traffic Motors - 25% reduction - reduces enforcement at problematic
locations
- OUt Officers - 33% reduction - reduces OUt enforcement and education
. Reduced public service hours and support at Civic Center
and South branches
- Civic Center Branch closed on Sundays (South Branch is currently closed
on Sundays as a result of previous cost cutting measures)
. Reduced operational staffing
- Population served/FTE. 7,038
- CA statewide mean: 3,092
- Chula Vista ranks 166 out of 180 CA library systems
- Bottom 10% statewide
Loss of programs for children and teens
- Cut baby and toddler story times and after-school diversion programs
- Fewer class tours and school visits
. Book and materials budget reduced to $1,33 per capita
~ CA statewide mean: $3.23 per capita
- Chula Vista ranks 148 out of 180 CA library systems
- Bottom 20% statewide
20
.
Close Norman Park Senior Center
Close remaining facilities (11) on Mondays as result of
reduction of part-time staffing and associated supplies &
services budgets
- Facilities are currently closed on Sundays as a result of previous
cost cutting measures
Elimination of 90% of free activities at Otay Recreation
Center
Elimination of City support for Nature Center utilities
.
.
.
.... , " .: ' ',;;vii,;" ", /. 't::t.
:'."..St'~ffin.g. R~dudio~~t ~'.f i? ~ '.:'
''':--,,~CDYCJF - 'j> - "/ <iF ~ . .', . '~;+'L, ''":0'f~; < ,,\. it ''ti
D'LIA)IISIA. '"' '" ~ ,<' '" '., . "'.. "_ !j\ji J ~ ..~.....' ,:~ . ,.
~ ",' ~ . , . ~ . ~
,00
650
6.00
" 5,,0
5.'8
;CO
.~
.00
City of Chula Vista
BudgetedPerm3netlt&HourlyStafling"
FTEspc't,OOOPopul"lion,CilywidcTolal
-'~-- ""'-
624 \l
~'--<. J'" '00 '" '00 '"
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--.---1
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Beginning 111 January 201] the Unreplesenled Employees will begin paying their share of pension cost
\vhich is 8% for Miscellaneous Employees and CJ% fnr Public Safely Employees
22
20%
--1
10%
0%
_10%
-20%
~O%
<
~
, *" ~ d: _ " &
C w
w ~ ~ :c- '0 "
$ ~ ~~ '"
< c
W U n"
0 , >
a Raises To Date 0 Scheduled Raises a Pay Cuts 0 Raises Glwn Up
Executives, Senior MilnZlg~rs, Confidential, MMgr/Profwill hegin paying their share llfthe pension
cost in JanuaT}' 20 11 This is reflecteu in the chart <lbove.
Chart does not account for step increases, rromotions, n....c1assllieatl()J1S ete.
OC\iEA(MLsce[1)
$5,000,000
CPOA(Po[ice)
$4,000,000
a IAFF (Fire)
DMMlPROF
53,000,000
oWCE(Engineers)
$2,000,000
o May:>rlCounclllExecslSrMgrlConf,
IMMgrProf(Unrep)
51,000,000
5432,230
:;1':,);
$0
Employee Share of Pension Cost
i\!Jy"r/( ;"ullcil/j"Xl'cutiVl'sjSl'ni"r l\1an;1:">;l'r~jl\ltdi\l:..>;rl'n,t Illnrcp) :lnd 1:'lTlhdcnllai
ulljJl()ycl's llarl' :lgrccd to pay their sh.ln: "f pl:nsj(lTl C(,st \,(;ginning in January ~{) I j.
23
Miscellaneous Employees
Pension Benefits
- 3% of salary @ age 60
- EPMC
- Based on highest 1 year salary
- Retiree health care costs
subsidized via pooling with
active employees
Pension Contribution
- City pays "Employer Share"
- City pays "Employee Share'"
8%
- City pays EPMC
Public Safety Employees
Pension Benefits
- 3% of salary @ age 50
- EPMC
- Based on highest 1 year salary
- Retiree health care costs
subsidized via pooling with
active employees
Pension Contribution
City pays "Employer Share"
City pays "Employee Share":
9%
City pays EPMC
Miscellaneous Employees
Pension Benefits
- 2% of salary @ age 60
- Based on 3 year average
highest salary
- Retiree health care costs no
longer subsidized via pooling
with active employees
Pension Contribution
- City pays "Employer Share"
- Employee pays "Employee
Share" 8%
Public Safety Employees
Pension Benefits
- 2% of salary @ age 50
- Based on 3 year average
highest salary
- Retiree health care costs no
longer subsidized via pooling
with active employees
Pension Contribution
- City pays "Employer Share"
- Employee pays "Employee
Share" 9%
24
'~,;&:;;.'~~~p~~t ?f J:i;e1i:'2 9~:':E~p~()'~~'~<
'i>~'~',J.>enSlpnJ~eiO:e&1;S, ,',.:';'\!,'~ ,..;'{:~;< :~.;
Miscellaneous Employee Example
Tier 1
Retirement Formula (3%@60)
AnnualSal"ry
EPMC(I:l%)
Total Salary
Years of Service
Ben\CtltFactor
Annual Pension {% of Pay)
Clot~I'Annual Pension
Tier2
RetirementFormula{2%@60)
Annual Salary
EPMC (8%) Eliminated
Total Salary
Years of Service
Benefit Factor
Annual Pension (% of Pay)
LT~tal'A_nnLJal Pensipn
[~i;'"du(;e:II.P"(}f1si()fl,f3,e:r1e:!i.t!i
Began wOlking in Chula Vista atage 30
Retired after 30 years atage 60
Public Safety Employee Example
$ 75,000
$ 6,000
S 131.000
30
3.0%
90%
S 72,2.QfC]
S 75,000
S
S 75,000
30
2,0%
60%
S 4:';:000
.~~';,,]
Tier 1
Retirement Fonnula (3%@50\
Annual Salary
EPMC (9%)
Total Salary
S 75,000
S 6,750
S 8U50
30
3.0%
90%
:::'$.:.Jj'???m'
75,000
75,00n
30
2,0%
60%
Years of Service
Benefit Factor
Annual Pension (% of Pay)
rTotal'Annua! pension
.~9,%]
Senior Managers 47.00 (20.00) -43%
Mid Managers* 6500 (2700) 42%
Executives 24,00 (9,00) 38%
Professionals' 76.50 (27.50) -36%
CVEA 609.25 (162.75) -27%
WeE 37.00 (10,00) -27%
CONF 24.00 (4.75) -20%
POA (Police Officers Association) 247.00 (11.00) -4%
Mayor & Council 5.00 0%
IAFF (International Association of Firefighters) 112.00 12.00 11%
TOTAL (less CBAG) 1,246.75 (260.00) -21%
CBAG 17.00 1.00 6%
TOTAL CITYWIDE 1,263.75 (259.00) -20%
Years of Service
Benefit Factor
Annual Pension (% ofPayJ
rTo!al'AnnuaIPension
Tier2
Retirement Formula (2% @ 50)
Annual Salary
EPMC (9%) Eliminated
Total Salary
[Ri;dl!ced Eension.Senefits
Began wurking in Chuia Vista al aye 20
Retiled after 30 years at age 50
4MQQ]
(3,00)
(300)
(700)
(23.00)
(1.00)
(1.00)
(38.00)
(38.00)
.Jin' Mi";\f"n"~{'/ "",/I'wf<,.I.""""/ 1"/""1" ",'/<.' IIIIi"lm:.''''II"d in rr ]00(,.07. A.,,, /"'.wll. illS ,,," lV"-"hI,, I" I,kllllji'h"."'nc IlI/n'!'re,,.,,,,,,,,1
,.,'n", H'/'n'.,ml"" Fn,', ,,,,,,t., fi'r 111<""'- gm"l".
25
Senior Managers 47.00 (20.00) -43% (2.00) (22.00) -47%
Mid Managers~ 65.00 (27.00) -42% (1.00) (28.00) -43%
Executives 24.00 (9.00) -38% (9.00) -38%
Professionals~ 76.50 (27.50) 36% (1.50) (29.00) -38%
CVEA 609.25 (162.75) -27% (49.50) (212.25) -35%
WeE 37.00 (10.00) -27% (10.00) 27%
CONF 24.00 (4.75) 20% (4.75) 20%
PQA 247.00 (11.00) -4% (34.00) (45.00) -18%
Mayor & Council 5,00 0% 0%
IAFF 112.00 12.00 11% (3.00) 9.00 8%
TOTAL (less CBAG) 1,246.75 (260.00) -21% (91.00) (351.00) -28%
CBAG 1700 1.00 6% 1.00 6%
TOTAL CITYWIDE 1,263.75 (259.00) -20% (91.00) (350.00) -28%
'/ /I" AIM A/analie'rand I'ni(.c,\'.\'wnal 1i.r>JIIl',' I.ele' ""r"l'n'.H'mcd ill FY 2006-07. A"" result. 11 is '''''l','""ihle 1<1 idemif)' hi'lOne unr("l'reum,'d
""","si-"l're""c"'edl-"IF"""'lI<forlhrseliroII'S
26
I[i ~:t: General' iEund R:ev:eti:ff~s,:.i":1:1t;' :::,;
~ ~~7 ,.~~"'O"~' "~.~;..t.,., of ",,\ ""'".~
, , ": DV<:lA1{'\.'!I11(.~1 , ',1, .',.,',." "" :,' ."
.~ -' ~~-':~.;.,\iI \:I~JC<< ~ ,,. ;{: h ~~; :{J! """ ~4 ..,'.~P. '" 1\,' ~
. . ,,~_ II! " e_ .' ~ ",,,_ "- '? '1; " 'i' { J-' . ~. f, , ~ " k!
Development Rev.
$1.4 M
1%
Interfund Reimb.
$9.7 M
7%
Motor Vehicle
Licenses
Franchise Fees
$7.7 M
6%
Sales Tax
$236 M
18%
Users Taxes (UUT)
$8.8 M
"7%
TOT
$1.9 M
1%
Charges for
Services
Property Taxes
$24.1 M
17%
$5.7 M
~ 4%
"--Other Local Taxes
$2.0 M
2%
;~'a;' . Hlstori~:u~l"r .~e~e~~e~.~ -;::',;~':>;
-, ..:._"",~'." (S;"'''I> 1>001) " ,-' -" " ' .,". "," ,
as.M'VIiIA: . ~~';1'fif". . ,< .." '""f.~ .' ."' f
r iV :.1' ~ ",,'if ~'~ i'h " r~ ' ~ ~ ~ . .
UI $10.0.
c
~ $90
~
S8.0
S7.0'
$6.0
$5.0
$4.0 '
$3.0
$2.0 '
$1.0 '
$0.0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
. Telecom (TUT) Cl Energy
Per -hu!ited Financial ,')'tll{cmcnfs
27
Component of Utility Users' Tax (UUT)
. Proposition H
. November 2010 ballot
. Modernization of ordinance to reflect new technologies
. Possible loss of $5-6 million of current revenues
. If not approved by voters, additional cuts would be
necessary
limHll,rr:'7i}
Public Works
~()<3r(j!)~_Com.m.
(tiIffiJ
$ 63,65.'i
$" 2,608
1.00
j)'::::C:m'rmmIl
Reduced Administrative & Fiscal Support
~,~p~,ies&SerVice5 _ _ ___
Eliminate Youth Lib Svcs and Library Educational After School Program
(~EAPL___",""""""","" __ ... _____._"'".~ $191,098
F3educ~Tl?:~~Svcs Support & fUrt~"lrC:Llt~t()E.l()ok Budget --~S46?,~]3
, -Cut Pnnclpal Recreation Manag-ereliminate professionaf"'(wersighl of pr~g~ms
&activilies ____~___ ___.__,,___ ,5128,197
Reduce Youth Alhletics $ 7684--
Reduce ServlCesatVeteranslHeritage/Montevalleand eliminate Mobile R~----
Recreation Program _ _~,865~:09
<::ity.f"()LI~~i[==== Reduce CIIY]:.1J1I1lf;,il$0pportStaff--n __."______~,735 _..,..___
DeveloPr1l,t?rJt,~vCs"""Reduce Advanced PI~rJrJirJg Staffing """'" , ,5173,198 1 50
l~i;;aa~Y~_-='''''~~~~~~~~~~~~~~=~i~i~'~~~ie7-~:~~~~:~e L~~r~t~;'i~(;;V'-~~",,,,, _.-=~ ~;;~::~~ -- ;:~~
""- ---Reducehrsofopen:;1I0~cerii'ff"~40%)andSOulhCV-- ------
Library ( ~.9'J1o),,~i~r~~les $449,546 6.75
Recreatio"rl " - ,Close otay Rec.Cent'e:;'-:''N'o''Recreafunai svesT" Sout'hwestCY $1"14,757 1.00
RecreatiOn"' -- ~Close;LornaVe;.(ie"'"'' '" , ...,..,...----.0,- ,-,--- - .," . $198,592 2.00
R;creation'" ."- Close'Parkway-P";)"ol .-.."... '''$1'09,646 1.00
Recreatio'n-. Close Salt Creek"center $167,172 2.00
Re~reation """,~f.,I.~se ~_a~,^,<lY(:;~~!l:!,~!eark,^,ay GymIMem(l,ri,<l.l..!"I!?~L___"",._,. -. .' $270;2'32 ,,,.,~:,Q,~
Reduced Communication Notices to the Public and support for City Managers
Office
-Eii;:;;'i~;;te Volunteer coord";'natlon & reduce Maintena-;~~'.Contracts
Further Reduclion In 6ei"ltional Hrs and Dela sin Re artin"
SlideSublotal
Libr~ry
Library__
2,00
"3"0]
100
!,~~Istratlon
HR/IT
Cit Clerk
$91.591
. -+--------s125,24S"
$100,097
$3,519540
1,00
~75
"1,00
35.50
28
/.mm;pr::m
Severe backlog in Purchase Orders and P<lYIllEJrll<;I()V"'ndo~<;
IT "~g~canl reduciionin Micro Computer Support and IT Administration
Public V\iorkS Reductions of Custodial Services, Building and Equipment Maintenance
Public Works Elimination ofqrailiii"Removal progr~i:n~ - "-~-
oeveloPrne0tSvcs Elirnifl<ltEJ~(;()rl()rnic Developmentr:>l()gr<l1ll _m~___
Mj';;"'WO"fkS "~duceStreetMa~eServices
Public Works _ _ f3EJ:rJLjc;", TrEJEJ Tri!llming services,,~ OVEJ:,r;<;ight,,~lty-i.ide'-""-
Public Works Reduce NPDES staffln
Slide Subtotal
Tolal
("'"'
$ 195,010
$-235,581-
_J....Q9.?674
___$_651,255
$279,596
-----$433,177"
-'---$3'81.445
$108,085
$2.307,823
$5,827,363
" "'.' ':, ' '",. ". ~ .'ili\C ..','..-0"'. '.' I
" b ~ t '.' ~I ~~~ ....~ 'it~. .
'_~~. :I' ~'/"'i'~',' "" 'v) '. :
. try' G ~ "\
,"'+ 1"\)"1 '( 'a .. ><^'\j "~. "';( ,.. \ .,; d JI ~." .'"
aw ". ~'''# " .. . I '~'. ~~. ):~' 4 .- " ,
a-au~ ~'\if' )~; " . .~. m'4.t: ~ zo.,", ,
0i\ ." ~ "" '~':.: _ ' ) 1; l; "') ,. "", ~'.iS,' .." . ""~.'
The proposed cuts DO NOT:
Add to General Fund operating reserves
Fund equipment & technology replacement needs
Add reserves to our public liability fund or bring down unfunded
pension liabilities
. The proposed cuts DO:
Allow the City to stay in balance and avoid deficit spending
Assume economic stabilization and no further loss of revenues
29
. No action by City Council requested at this time
. City management will continue to reach out to bargaining
units
. If no concessions from bargaining units
- November - December 2010: Conduct exit interviews
- January 13, 2011. Layoffs occur
. Balanced FY 2011-12 budget will be presented to Council
in Spring 2011
Full presentation will be available on the Ci(V'8 websife @J www,chulavistacu,f!ov
and on the Ci(v's intrunet site.
30
AddiflD1'LcJ
t:/:~
Jrcr:or mcdjOfL.
I
PETITION TO KEEP THE NORMAN PARKS SENIOR CENTER
OPEN FOR OUR SENIORS
Friday October] 81,20 I 0 we (the seniors of Chula Vista) were informed of a "Special
Meeting" at the Library concerning the closing of our beloved Norman Parks Senior
Community Center.
That is not even a full three days notice and for seniors that is not a very long time.
We who have discovered the fellowship and joy available to us in our community center
find Ihis to be appalling and disheartening. How can the big beautiful City of Chula Vista
even consider doing such a thing. This is very disturbing to the seniors who enjoy our
special meeting place.
We need a place to meet and the interaction of others is very important to our general
health and mental health.
We who sign this petition would ask that YOll please let us enjoy the Senior Center for
many years to come. Not to mention the many members who didn't even get the notice
of the proposed closing or the scheduled meeting.
Vle respectfully request the you seriously consider keeping our center open.
O~~~oJ~
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