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Item 24 - Appropriations Limitation AGENDA REPORT SUMMARY - ~ - TO: Honorable Mayor and Members of the City Council FROM: James L. Bowersox, City Man~ , INITIATED BY: John D. Fitch, Assistant City Manage~~ Peggy A. Stewart, Director of Administ ative Servic~r Christine Tsung, Finance Manager ~ ' DATE: June 27, 1995 SUBJECf: Appropriations Limitation ABSTRACf Government Code Section 7910 requires each local government to establish its Proposition 4 appropriations limit by resolution each year at a regularly scheduled meeting or a noticed special meeting. Proposition 111 passed in 1990 allows the City to use a higher adjustment factor, and this report has reflected that change. - ENVIRONMENTAL REVIEW This action is not subject to CEQA review. FISCAL IMPACT None. The City's 1995-1996 budget appropriation is within Proposition 4 limit. ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE None RECOMMENDATION It is recommended that the City Council adopt the attached resolution establishing the City's appropriation limit for fiscal year 1995-1996 as required by Government Code Section 7910. ACTION - 1 of 14 JUN 2 7 1995 nEM 24 ~ AGENDA REPOR" CITY OF POW A Y This report is included on the Consent Calendar. There will be no seperate discussion of the report prior to approval by the City Council unless members of the Council. staff or public request it to be removed from the Consent Calendar and discussed separately. if you with to have this report pulled for discussion. please fill out a slip indicating the report number and give it to the City C)erk prior to the beginning of the City Council meeting. TO: Honorable Mayor and Members of the City Council FROM: James L. Bowersox, City Man~ . "-" INITIATED BY: John D. Fitch, Assistant City Manage~:;' Peggy A. Stewart, Director of Administrative Services Christine Tsung, Finance Manager .~ U DATE: June 27, 1995 SUBJECT: Appropriations Limitation BACKGROUND Proposition 4 was adopted by the voters on November 6, 1979, and became Article XIIIB of the California Constitution. This article places a limit on the annual growth allowable for State and Local government appropriations. As part of the articles of incorporation approved by the voters in November of 1980, the base year appropriations limitation for the City of Poway was established at $7,047,200 for fiscal year 1981-1982. Article XIIIB provides that the base limit be increased in future years by the percentage of growth in population and by the increase in Consumer Price Index or California Personal Per Capita Income, whichever is lower. Proposition 111 and SB-88 (Chapter 60/90) allow cities, beginning with the 1990-91 appropriations limit, to use an alternative to the lesser of California per capita income or the U.S. consumer price index for measuring inflation. Each city may choose either the growth in the California per capita income or the growth in the nonresidential assessed valuation due to new nonresidential construction within the city as an alternative inflation measure. The City of Poway has chosen the new alternative allowed by law. The nonresidential growth rate within the City is provided by the San Diego County Assessor. The revised annual adjustment factors will be applied to the 1986-87 limit and each in between in order to calculate the 1990-91 limit. From FY 1990-91 on, the City has chosen the higher of California per capita income or nonresidential assessed valuation growth as its assessment factor. Using this data, the appropriation limit for each fiscal year was calculated as follows: ACTION: 2 of 14 J JUN 27 1995 Ij~M ~ c::.." - - ---- Agenda Report June 27, 1995 Page 2 Fiscal Year Amount 1982-1983 $ 7,533,457 1983-1984 $ 8,296,596 1984-1985 $ 8,804,348 1985-1986 $ 9,307,076 1986-1987 $ 9,987,423 1987-1988 $15,746,171 1988-1989 $19,193,008 1989-1990 $55,185,656 1990-1991 $64,109,176 1991-1992 $69,577 ,689 1992-1993 $70,760,510 1993-1994 $74,128,710 1994-1995 $75,485,265 The State Department of Finance has notified the City that the increase in the California per capita personal income equaled 4.72 percent, and the growth in population for 1995 equaled -1.19 percent. Therefore, the City appropriation limit for fiscal year 1995-1996 is adjusted by these factors to equal $78,248,026. - Following the passage of Proposition 4, the State Legislature adopted Government Code Section 7910 which requires each governmental agency to establish its appropriation by resolution annually. Attached please find a copy of a resolution which establishes the City of Poway's appropriation limit for fiscal year 1995-1996. It should be noted that Proposition 4 limits appropriations of proceeds of taxes only. Proceeds of taxes includes such revenues as property taxes, sales and use taxes, transient occupancy taxes, and most of the general fund's State subventions. Revenues from other sources such as fees for services and State and Federal grants are not subject to the limit. FINDINGS In reviewing the proposed budget for fiscal year 1995-1996 based upon the above criteria, it was determined that the appropriation of proceeds of taxes subject to the Proposition 4 limitation equals $12,790,414 which is below the City's appropriation limit of $78,248,026 by $65,457,612. ENVIRONMENTAL REVIEW This action is not subject to CEQA review. FISCAL IMPACT None. The City's 1995-1996 budget appropriation is within Proposition 4 limit. 3 of 14 JUN 27 1995 IlEM 24 ! Agenda Report June 27, 1995 Page 3 ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE None RECOMMENDATION It is recommended that the City Council adopt the attached resolution establishing the City's appropriation limit for fiscal year 1995-1996 as required by Government Code Section 7910. JLB:JDF:PAS:CT:eg Attachments: 1. Schedule A - Schedule to Calculate Appropriations Subject to Limit 2. Schedule B - Schedule of Appropriations 3. Schedule C - Schedule to Categorize Estimated Revenue 4. Schedule D - Schedule of Appropriations Subject to Limit S. Resolution Adopting Appropriations Limitation c:\wpfi1es\app1imit.agn 4 of 14 JUN 2 7 1995 HEM 24 - -~ Schedule A CITY OF POWA Y Schedule to Calculate Appropriations Subject to Limit For the Fiscal Year Ended June 30, 1996 Appropriations Limit 1981-1982 $7,047,200 CPI Fiscal Year 1982-1983 1.0679 Poway Change in Population 1-1-82 1. 00 1 CPI Fiscal Year 82-83 x Poway Change in Population 1-1-82 x 1.0690 Appropriations Limit 1982-1983 $7,533,457 California Personal Per Capita Income for Fiscal Year 1983-1984 1.0235 Poway Change in Population 1-1-83 1. 0760 California Per Capita Income for Fiscal Year 1983-1984 x Poway Change in Population 1-1-83 x 1.1013 Appropriations Limit 1983-1984 $8,296,596 U.S. Consumer Price Index (CPI) 1.0474 Poway Change in Population 1-1-84 1.0132 U.S. CPI for Fiscal Year 1984-1985 x Poway Change in Population x 1. 0612 Appropriations Limit 1984-1985 $8,804,348 Poway Change in Population 1-1-85 1. 0190 U.S. Consumer Price Index (CPI) 1. 0374 U.S. CPI for Fiscal Year 1985-1986 x Poway Change in Population x 1. 0571 Appropriations limit 1985-1986 $9,307,076 Poway Change in Population 1-1-86 1.0490 U.S. Consumer Price Index (CPI) 1.0230 U.S. CPI for Fiscal Year 1986-1987 x Poway Change in Population x 1.0731 Appropriations Limit 1986-1987 $9,987,423 .- Attachment 1 5 of 14 JUN 27 1995 1'7~M 24 . oM _ ,- Schedule A Page 2 CITY OF POWAY Schedule to Calculate Appropriations Subject to Limit For the Fiscal Year Ended June 30, 1996 Appropriations Limit 1986-1987 $9,987,423 Poway Change in Population 1-1-87 1. 0325 Poway Nonresidential Growth Rate 1.5270 Poway Nonresidential Growth Rate for Fiscal Year 1987-1988 x Poway Change in Population x 1.5766 Appropriations Limit 1987-1988 $15,746,171 Poway Change in Population 1-1-88 1.0463 Poway Nonresidential Growth Rate 1.1650 Poway Nonresidential Growth Rate for Fiscal Year 1988-1989 x Poway Change in Population x 1.2189 Appropriations Limit 1988-1989 $19,193,008 Poway Change in Population 1-1-89 1.0450 Poway Nonresidential Growth Rate 2.7515 Poway Nonresidential Growth Rate for Fiscal Year 1989-1990 x Poway Change in Population x 2.8753 Appropriations Limit 1989-1990 $55,185,656 Poway Change in Population 1-1-90 1.0304 Poway Nonresidential Growth Rate 1.1274 Poway Nonresidential Growth Rate for Fiscal Year 1990-1991 x Poway Change in Population x 1.1617 Appropriations limit 1990-1991 $64,109,176 Poway Change in Population 1-1-91 1. 0356 U.S. Consumer Price Index (CPI) 1.0480 U.S. CPI for Fiscal Year 1991-1992 x Poway Change in Population x 1. 0853 Appropriations Limit 1991-1992 $69,577,689 6 of 14 JUN 27 1995 ni.M 24 - Schedule A Page 3 C!TY OF POWA Y Schedule to Calculate Appropriations Subject to Limit For the Fiscal Year Ended June 30, 1996 Appropriations Limit 1991-1992 $69,577,689 Poway Change in Population 1-1-92 1.0236 Capital Per Capita Income .9936 California Per Capita Income for Fiscal Year 1992-1993 x Poway Change in Population x 1.0170 Appropriation Limit 1992-1993 $70,760,510 Poway Change in Population 1-1-93 1. 0199 Capital Per Capita Income 1.0272 California Per Capita Income for Fiscal Year 1993-1994 x Poway Change in Population x 1. 0476 Appropriation Limit 1993-1994 $74,128,710 Poway Change in Population 1-1-94 1.0111 Capital Per Capita Income 1. 0071 California Per Capita Income for Fiscal Year 1994-1995 x Poway Change in Population x 1.0183 Appropriation Limit 1994-1995 $75,485,265 Poway Change in Population 1-1-95 (1.0119) Capital Per Capita Income 1.0472 California Per Capita Income for Fiscal Year 1995-1996 x Poway Change in Population x 1.0366 Appropriation Limit 1995-1996 $78,248,026 JUN 2 7 1995 F>=M 24 7 of 14 ,-- -- - Schedule B CITY OF POWA Y Schedule of Appropriations For the Fiscal Year Ended June 30, 1996 General Fund Legislative and Administrative $ 948,865 Administrative Services 1,148,399 Community Services 2,785,600 Planning Services 1,157,180 Public Services 1,146,373 Safety Services 7,203,550 Engineering Services 1.325.801 Subtota 1 $15,715,768 Soecial Revenue Funds Street Imorovement-Gas Tax $ 844,400 Orainaqe Fund Administrative Services $ 18,423 Public Services 321,178 Engineering Services 8.811 348,412 Grant Funds Capital Projects 223,000 Street Develooment/Proo A Public Services 871. 688 Subtota 1 $ 2,287,500 Soecial Assessment Fund Public Services $ 1,506,888 Water Fund Administrative Services $ 849,918 Engineering Services 51,886 Legislative/Admin Services 114,321 Public Services 7.608.193 Subtotal $ 8,624,318 Attachment 2 8 of 14 JUN 27 1995 P .;: ~., 24 j__M - - Schedule B Page 2 Schedule of Appropriation For Fiscal Year Ended June 30, 1996 Sewer Fund Administrative Services $ 509,912 Engineering Services 52,932 Legislative/Admin Services 80,024 Public Services 4.773.800 Subtota 1 $ 5,416,668 Caoital Proiects Fund Drainage Improvement $ - Caoital Reolacement Fund Operating Expense $ 798.268 GRAND TOTAL - ALL CITY APPROPRIATIONS SJ4.349.410 .- JUN 2 7 1995 li~M 24 9 of 14 Schedule C CITY OF POWA Y Schedule to Categorize Estimated Revenue For Fiscal Year Ended June 30, 1995 Total Exclude Net Genera 1 Fund Taxes $ 7,471,630 $ - $ 7,471,630 Franchise 618,000 - 618,000 License & Permits 294,050 294,050 - Fines & Forfeitures 96,600 96,600 - (I)Revenue from Use of Money 618,886 216,472 402,414 Revenue from Use of Property 403,164 403,164 - Revenue from Other Agencies 1,720,620 - 1,720,620 Current Fees &.Services 4,333,470 4,333,470 - Other Revenue 482.910 482.910 - Total General Fund $16,039,330 $ 5,826,666 $10,212,664 Street Imorovement - Gas Tax $ 844,400 $ - $ 844,400 Park Imorovement 190,000 190,000 - Drainaqe Fund 646,090 259,790 386,300 Grant Fund 496,620 496,620 - Assessment Districts 1,614,590 1,469,400 145,190 Street Develooment Fund 175,590 175,590 - Proo. A Fund 1,201,860 - 1,201,860 Municioal Imorovement (730) (730) Communitv Facilitv Acquisition 590 590 - Debt Service 409,470 409,470 - Communitv Facilities Debt Service 2,939,420 2,939,420 - Water Fund 10,959,960 10,959,960 - Sewer Fund 5,316,030 5,316,030 - Caoital Reolacement 924,290 924,290 - Trust 72.230 72.230 - ESTIMATED GRAND TOTAL ALL FUNDS lil.829.740 F9.039.326 ~12.790.414 (1) Interest income to be excluded is computed as: Exclusion before interest x total interest = excluded interest Total revenue Attachment 3 JUN 2 7 1995 I'T-'~ 24 10 of 14 ;; ~f: .0 - Schedule D CITY OF POWA Y Schedule of Appropriations Subject to Limit Fiscal Year 1981-1982 Through Fiscal Year 1993-1994 Actuals as Well as Estimated Figures for Fiscal Year 1994-1995 Through Fiscal Year 1995-1996 Fiscal Year 1981-1982 Total All City Appropriations $10,165,924 Less: Non-proceeds of Taxes 8.599.062 Total Appropriations Subject to Limit $ 1,566,862 Less Appropriation Limit 7.047.200 Amount Under Proposition 4 Limit $ 15.480.338\ Fiscal Year 1982-1983 Total All City Appropriations $12,141,258 Less: Non-proceeds of Taxes 8.857.546 Total Appropriations Subject to Limit $ 3, 283 , 712 Less Appropriation Limit 7.533.457 Amount Under Proposition 4 Limit $ 14.249.745\ Fiscal Year 1983-1984 Total All City Appropriations $16,498,389 Less Non-proceeds of Taxes 11.332.100 Total Appropriations Subject to Limit $ 5,166,289 Less Appropriation Limit 8.296.596 Amount Under Proposition 4 Limit $ 13.130.307\ Fiscal Year 1984-1985 Total All City Appropriations $16,709,874 Less: Non-proceeds of Taxes 10.580.552 Total Appropriations Subject to Limit $ 6,129,322 Less Appropriation Limit 8.804.348 Amount Under Proposition 4 Limit $ 12.675.026\ Fiscal Year 1985-1986 Total All City Appropriations $16,989,076 Less: Non-proceeds of Taxes 9.891. 514 Total Appropriations Subject to Limit $ 7,097,562 Less Appropriation Limit 9.307.076 Amount Under Proposition 4 Limit $ 12.209.514\ Attachment 4 11 of 14 JUN 2 7 1995 na~ 24 Schedule D Page 2 Fiscal Year 1986-1987 Total All City Appropriations $16,226,940 Less: Non-proceeds of Taxes 9.181.944 Total Appropriations Subject to Limit $ 7,044,996 Less Appropriation Limit 9.987.423 Amount Under Proposition 4 Limit $ 12.942.427\ Fiscal Year 1987-1988 Total All City Appropriations $19,687,140 Less: Non-proceeds of Taxes 11. 744.337 Total Appropriations Subject to Limit $ 7,942,803 Less Appropriation Limit 15.746.171 Amount Under Proposition 4 Limit S 17.803.368\ Fiscal Year 1988-1989 Total All City Appropriations $23,727,890 Less: Non-proceeds of Taxes 13.465.358 Total Appropriations Subject to Limit $10,262,532 Less Appropriation Limit 19.193.008 Amount Under Proposition 4 Limit $ 18.930.476\ Fiscal Year 1989-1990 Total All City Appropriations $27,214,810 Less: Non-proceeds of Taxes 15.923.130 Total Appropriations Subject to Limit $11,291,680 Less Appropriation Limit 55.185.656 Amount Under Proposition 4 Limit $143.893.976\ Fi scal Year 1990-1991 Total All City Applications $28,427,668 Less: Non-proceeds of Taxes 16.118.066 Total Appropriations Subject to Limit $12,309,602 Less Appropriation Limit 64.109.176 Amount Under Proposition 4 Limit $151. 799.574\ 12 of 14 JUN 2 7 1995 IJ2M 24 - Schedule D Page 3 Fiscal Year 1991-1992 Total All City Appropriations $27,677,240 Less: Non-proceeds of Taxes 16.644.089 Total Appropriations Subject to Limit $11 ,033, 151 Less Appropriation Limit 69.577.689 Amount Under Proposition 4 Limit $158.544.538\ Fiscal Year 1992-1993 Total All City Appropriations $29,037,253 Less: Non-proceeds of Taxes 17.750.379 Total Appropriations Subject to Limit $11 ,286,874 Less Appropriation Limit 70.760.510 Amount Under Proposition 4 Limit $159.473.636\ Fiscal Year 1993-1994 Total All City Appropriations $31,209,958 Less: Non-proceeds of Taxes 17 .184.377 Total Appropriations Subject to Limit $14,025,581 Less Appropriation Limit 74.128.710 Amount Under Proposition 4 Limit $160.103.129\ Fiscal Year 1994-1995 Total All City Appropriations $32,738,000 Less: Non-proceeds of Taxes 20.213.613 Total Appropriations Subject to Limit $12,524,387 Less Appropriation Limit 75.485.265 Amount Under Proposition 4 Limit $162.960.878\ Fiscal Year 1995-1996 Total All City Appropriations $34,349,410 Less: Non-proceeds of Taxes 21. 558. 996 Total Appropriations Subject to Limit $12,790,414 Less Appropriation Limit 78.248.026 Amount Under Proposition 4 Limit $165.457.612\ - I~-'~ 24 JUN 27 1995 i ::.f~, 13 of 14 RESOLUTION NO. 95- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF POWAY, CALIFORNIA, ADOPTING AN APPROPRIATIONS LIMIT FOR FISCAL YEAR ENDING JUNE 30, 1996 WHEREAS, the Gann Initiative or Proposition 4, hereby referred to as Article XIIIB of the Constitution of the State of California, was passed by the people; and WHEREAS, Article XIIIB mandated an appropriations limit on various units of government, including the City of Poway; and WHEREAS, that limit has been calculated by the Finance Division of the City of Poway using current gUidelines provided by the League of California Cities; and WHEREAS, the City Council of the City of Poway desires to formally adopt that appropriations limit for the City. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Poway that in accordance with Article XIIIB of the Constitution of the State of California, the appropriations limit for the City of Poway for Fiscal Year 1995-1996 is $78,248,026. PASSED, ADOPTED AND APPROVED, by the City Council of the City of Poway, California, at a regular meeting thereof this 27th day of June 1995. Don Higginson, Mayor ATTEST: MarJorie K. Wahlsten, City Clerk 14 of 14 JUN 27 1995 i-::- :::7":1 24 cJ :,,"'.; _ ~