TITLE
Recommendation to approve the Fiscal Year 2013 third quarter departmental and fund budget appropriation adjustments in accordance with existing City Council policy. (Citywide)
DISCUSSION
On September 4, 2012, the City Council adopted the Appropriations Ordinance governing the City's Adopted Budget for Fiscal Year 2013 (FY 13). Periodically, changes in revenue or operating conditions require appropriation adjustments. For example, in certain cases, these adjustments enable departments to expend recently awarded grant revenue for which there is no existing appropriation. In addition, changes for multi-year grants/projects are necessary to bring appropriations in line with final grant/project award amounts. In accordance with the City's practice, these adjustments are presented quarterly to the City Council for consideration. Please see Attachment A for a Summary of Proposed Adjustments of impacted City funds and Attachment B for a recap of FY 13 General Fund Expenditure Budget Adjustments.
This matter was reviewed by City Attorney Charles Parkin on September 5, 2013.
TIMING CONSIDERATIONS
The following requests for adjustments to FY 13 departmental and fund appropriations are necessary to reflect changes in operating conditions. City Council action is requested on September 17, 2013 to enable the timely processing of payments.
FISCAL IMPACT
Development Services
The California Department of Finance (DOF) approved Code Enforcement funding as part of the Recognized Obligation Payment Schedule for the period July 1 - December 31, 2012 (ROPS II) and, therefore, the Successor Agency received $193,000 for code enforcement services. The Successor Agency transferred this revenue to the General Fund (GP) to support code enforcement. An appropriation increase in GP is requested to reflect the transfer from the Successor Agency Fund (SA 270).
• Increase appropriations in the General Fund (GP) in the Development Services Department (DV) by $193,000 from the Property Tax Trust Fund Distribution.
The California Department of Finance (DOF) disallowed or capped a total of $6,447,151 in Successor Agency (SA) expenses. These issues were taken into account beginning in FY 13 and are not expected to be a budgeting problem. An appropriation increase is requested to reflect a transfer from the General Fund (GP) to the Successor Agency Fund (SA 270) to cover these disallowed or capped expenses and will be offset by an existing $4 million from General Fund reserves for that purpose and $2 million from fund balance.
• Increase appropriations in the General Fund (GP) in the Citywide Activities Department (XC) by $6,447,151 to reflect a transfer to the Successor Agency Fund (SA 270) from fund reserves and fund balance.
• Increase appropriations in the Successor Agency Fund (SA 270) in the Development Services Department (DV) by $6,447,151 from General Fund revenue.
Fire
The City Council previously authorized the City Manager to receive and expend Department of Homeland Security grant funds for the 2010 State Homeland Security Grant Program totaling $388,650. Since that time, additional funds of $4,533 have become available and are being awarded to cover training costs for first responders as well as funding for equipment maintenance. An appropriation increase is requested for these expenditures and will be offset by grant revenue.
• Increase appropriations in the General Grants Fund (SR 120) in the Fire Department (FD) by $4,533 from grant funds.
On July 23, 2013, the City Council authorized the early expenditure of items included in the Proposed FY 14 Budget. One item is for the commencement of the proposed FY 14 Fire Academy in FY 13. Enabling the early start of the Academy in FY 13 will provide a new cadre of Firefighters who will be able to fill current vacancies before the end of the calendar year. The cost to commence the Fire Academy in September 2013 is approximately $560,850. An appropriation increase is requested for these expenditures and will be offset by FY 13 one-time funds.
• Increase appropriations in the General Fund (GP) in the Fire Department (FD) by $560,850 from FY 13 one-time funds.
In April 2007, the City Council established the Fire Facilities Impact Fee that is applied on new development. As new development increases, the demand for public safety facilities also increases and impact fees help defray the costs for these facilities. As stated in the March 19, 2013 City Council letter on development impact fees, the Fire Department anticipates using fee revenue to support a portion of the cost of equipment and furnishing
of Fire Station 12. The new facility will be occupied by September 24,2013. This new fire station, built with former Redevelopment Agency funds, will include a disaster resource building and a community meeting room and will offer increased capacity to the North Long Beach community, as well as the entire City. An appropriation increase is requested for these expenditures and will be offset by existing fund balance.
• Increase appropriations in the Capital Projects Fund (CP) in the Fire
Department (FD) by $40,000 from fund balance.
Library Services
For FY 13, the Long Beach Public Library will receive up to $2,200 from the California Center for the Book to support "Book to Action 2013" program(s) scheduled at the Main Library. Programs and materials for this special program will be reimbursed by the Southern California Library Cooperative within two weeks of submission using passthrough federal Library Services and Technology Act grant funds. An appropriation increase is requested for these expenditures and will be offset by grant revenue. The grant does not require a cash or in-kind match.
• Increase appropriations in the General Grants Fund (SR 120) in the Library
Services Department (LS) by $2,200 (rom grant revenue.
Long Beach Gas and Oil
The Uplands Oil Fund was established to account for all cost and revenues for the City's proprietary oil interests and for the accumulation of reserves to pay for the City's portion of well abandonment and site-clearance liabilities. Oil production costs and transfers to the General Fund make up the majority of expenditures. The FY 13 Adopted budget included a City Council action to increase the price per barrel from $65 to $70. This resulted in a net increase of $1.3 million. While the FY 13 Adopted General Fund budget was increased to reflect this additional revenue, the Uplands Oil Fund expense budget was not increased to allow it to make the full transfer. An appropriation increase is requested in order to transfer the full $70 bbl to the General Fund, as adopted by the City Council in September 2012.
• Increase appropriations in the Uplands Oil Fund (SR 134) in the Long Beach
Gas and Oil Department (GO) by $1,313,921 from oil revenue.
The Southeast Resources Recovery Facility Fund (SERRF Fund) is used to maintain a waste to energy program, providing disposal services for residential and commercial refuse delivered by the City and various surrounding communities. The SERRF Fund, in accordance with the Joint Powers Agreement, is required to maintain a minimum fund balance. Any excess fund balance can be distributed on a 50/50 basis between the City and the Los Angeles County Sanitation District. An appropriation increase is requested to budget the transfer of these funds to the General Fund and LA County Sanitation, and will be offset by net facility revenue. The distribution amount of $2,756,015 will be made to both the City and LA County Sanitation. This transfer was budgeted as revenue in the General Fund, as part of the FY 13 Adopted budget.
• Increase appropriations in the Southeast Resources Recovery Facility Fund (EF 331) in the Long Beach Gas and Oil Department (GO) by $5,512,030 from net facility revenue.
Parks, Recreation and Marine
The Parks, Recreation and Marine Department (PR) has two trusts for the Animal Care Services (ACS) Bureau: the Teresa Trust Fund for Cats and the Derrickson Living Trust. In provision with the trust requirements, ACS recently purchased x-ray equipment that was not budgeted. An appropriation increase is requested for this expenditure and will be offset by funds from the Animal Care Trusts.
• Increase appropriations in the General Fund (GP) in the Parks, Recreation and Marine Department (PR) by $66,029 from the Teresa Trust Fund for Cats and the Derrickson Living Trust.
In March 2011, the American Golf Corporation (AGC) assumed lease #25092 from Choura Venue Services for the operation of the EI Dorado Golf Course Restaurant. The lease contains a provision for a percentage of the rent paid to the City to be deposited into a trust fund for capital improvements to the restaurant. As agreed to as part of the lease, AGC is in the process of a major restaurant renovation. Part of the project is to be paid from the EI Dorado Restaurant CIP Trust Fund. An appropriation increase is requested to reimburse AGC for these improvements and will be offset by funds from the EI Dorado Restaurant CIP Trust Account reserve.
• Increase appropriations in the General Fund (GP) in the Parks, Recreation and Marine Department (PR) by $131,276 from the EI Dorado Restaurant CIP Trust Account reserve.
The Parks, Recreation and Marine Department (PR) has two tennis centers, Billie Jean King (BJK) and EI Dorado Park (EDP). First Serve, Inc., has a permit for the operation and management of both centers. All revenue derived from tennis-related fees, set by the Parks and Recreation Commission, are deposited into the Tennis Trust Account (Trust). The Trust must be used for the purchase, maintenance, operation or improvement of grounds, buildings, structures, equipment or facilities for public tennis. At the EI Dorado Tennis Center several large lights used for nighttime play and unsafe conditions on the decks and stairs leading to the EI Dorado Tennis Center were replaced/repaired. An appropriation increase is requested for these repairs and will be offset by funds from the Tennis Trust Account reserve.
• Increase appropriations in the General Fund (GP) in the Parks, Recreation and Marine Department (PR) by $9,537 from the Tennis Trust Account reserve.
The Parks, Recreation and Marine Department (PR) has received $62,323 in various reimbursements for the following expenses: insurance claim reimbursement for property damage to a retaining wall caused by an automobile accident, insurance claim reimbursement for storm property damage at Rancho Los Alamitos, and Snow Day staff charges provided by Partners of Parks. An appropriation increase is requested for these expenditures and will be offset by reimbursement revenue.
• Increase appropriations in the Tidelands Operations Fund (TF 401) in the Parks, Recreation and Marine Department (PR) by $11,866 from reimbursement revenue.
• Increase appropriations in the General Fund (GP) in the Parks, Recreation and Marine Department (PR) by $47,913 from reimbursement revenue.
• Increase appropriations in the Special Advertising and Promotion Fund (SR 133) in the Parks, Recreation and Marine Department (PR) by $2,544 from reimbursement revenue.
The Parks, Recreation and Marine Department (PR) was originally budgeted to manage the Drake/Chavez Soccer Project. Project management has since been transferred to the Public Works Department (PW). An appropriation transfer from PR to PW is requested to move appropriations to the managing department.
• Decrease appropriations in the Capital Projects Fund (CP) in the Parks, Recreation and Marine Department (PR) by $2,513,000 from a reallocation of project funds.
• Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $2,513,000 from a reallocation of project funds.
On January 22, 2013, the City Council adopted a resolution to apply for grant funds through the California Department of Forestry and Fire Protection urban forestry grant program entitled "Urban and Community Forestry Inventory." The grant in the amount of $150,000 has been awarded to establish a parks tree inventory. The grant has a matching requirement of $52,000 that includes $3,000 for in-kind staff time. Matching funds and staff time are currently budgeted in the Development Services Fund (EF 337) in the Development Services Department (DV). An appropriation increase is requested to budget the grant award and will be offset by grant revenue.
• Increase appropriations in the General Grants Fund (SR 120) in the Parks, Recreation and Marine Department (PR) in the amount of $150,000 from grant revenue.
Police
As part of the FY 13 Budget, the City Council authorized the use of one-time Upland Oil Fund monies for the FY 13 Police Academy Class No. 86. An appropriation transfer is requested to shift funds to the Police Department to fund academy related expenses for Academy Class No. 86.
• Increase appropriations in the General Fund (GP) in the Police Department (PD) by $225,000 from one-time Uplands Oil funds.
• Decrease appropriations in the General Fund (GP) in the Citywide Activities Department (XC) by $225,000 for the FY 13 Police Academy Class No. 86 from one-time Uplands Oil funds.
The Chief of Police authorizes the use of $1,296,299 in State and Federal Asset Forfeiture funds for software licenses and maintenance, miscellaneous capital improvement projects, costs related to the consolidation of Divisions within the Public Safety Building, mapping software for the Crime Lab, the Gun Buy Back Program, new Patrol bicycles, new Academy gym equipment, equipment for new Recruits, and restocking of less lethal munitions. An appropriation increase is requested for these expenses and will be offset by Asset Forfeiture funds.
• Increase appropriations in the General Fund (GP) in the Police Department (PD) by $1,296,299 from Asset Forfeiture funds.
The Chief of Police authorizes the use of $15,000 in State Asset Forfeiture funds - Youth Intervention/Prevention for at-risk youth programs, including NAACP's Afro-Academic, Cultural, Technological and Scientific Olympics (ACTSO), Long Beach Bar Foundation's Short Stop Program, and the Operation Jump Start Program. An appropriation increase is requested for these expenses and will be offset by State Asset Forfeiture funds -Youth Intervention/Prevention.
• Increase appropriations in the General Fund (GP) in the Police Department (PD) by $15,000 from Asset Forfeiture funds.
The Chief of Police authorizes the use of Prisoner Welfare Trust funds to cover $39,940 in various expenses related to prisoner welfare in the Police Department jail. The expenses include installation of new jail cameras, installation of required padding safety features, and miscellaneous items required by State law for prisoner welfare. An appropriation increase is requested for these expenses and will be offset by the Prisoner Welfare Fund.
• Increase appropriations in the General Fund (GP) in the Police Department (PD) by $39,940 from the Prisoner Welfare Trust account.
The Chief of Police authorizes the use of Proposition 69 DNA reimbursement funds for various projects and overtime for the Police Department. These include overtime costs for evidence disposal, AWID access system for Field Services Division, consolidation of Youth Services with the North Division facility, additional Laserfiche licenses and the replacement of a security door in the men's jail. An appropriation increase is requested for these expenses and will be offset by the Proposition 69 DNA funding, which has no restriction on use.
• Increase appropriations in the General Fund (GP) and in the Police Department (PD) by $104,042 from the Proposition 69 DNA reimbursement funds.
The City's Municipal Ordinance allows Overweight Vehicles to operate on City streets and highways with a permit issued by the Public Works Department (PW). The last remaining truck scale in the Harbor District closed and new portable truck scales are needed at the cost of $48,950 for use by the Police Department's Patrol Bureau to continue enforcing the City's Overweight Vehicle Ordinance. Court settlement fines and penalties collected from trucking companies found to be in violation of permit conditions will offset the cost. An appropriation increase is requested for the new portable truck scales and will be offset by court settlement fines.
• Increase appropriations in the General Fund (GP) in the Police Department (PO) by $48,950 from one-time court settlement fines.
The City Council previously authorized the City Manager to receive, expend and increase the award amount for the Department of Homeland Security (DHS) FY 09 Urban Area Security Initiative (UASI) Grant. Additional funding in the amount of $500,000 has became available to the Police Department due to other agencies surrendering portions of their UASI 2009 awards. The Police Department is using the additional funds to purchase additional equipment to enhance the operations of the department's LBCOP user management system. An appropriation increase is requested for these expenditures and will be offset from grant revenue.
• Increase appropriations in the General Grants Fund (SR 120) in the Police Department (PO) by $500,000 from UASI grant funds.
The City Council previously authorized the City Manager to receive, expend and increase the award amount for the Department of Homeland Security (DHS) FY 10 Urban Area Security Initiative (UASI) Grant. Since that time, $526,701 of additional funds became available to the Police Department due to other agencies surrendering portions of their UASI 2010 awards, including $564 from the Fire Department. The Police Department is using the additional funds to purchase the previously leased modular trailers at the Police Academy, and for a ballistics testing system for the Police Crime Lab. An appropriation increase is requested for these expenditures and will be offset from grant revenue.
• Increase appropriations in the General Grants Fund (SR 120) in the Police Department (PO) by $526,701 from UASI grant funds and grant reallocation from the Fire Department.
• Decrease appropriations in the General Grants Fund (SR 120) in the Fire Department (FD) by $564 for grant reallocation to the Police Department.
The City Council previously authorized the City Manager to receive, expend and increase the award amount for the Department of Homeland Security (DHS) FY 11 Urban Area Security Initiative (UASI) Grant. Since that time, $295,240 of additional funds became available to the Police Department due to other agencies surrendering portions of their UASI 2011 awards. The Police Department is using the additional funds for training and additional equipment to enhance the operations of the Patrol and Investigations bureaus.
An appropriation increase is requested for these expenditures and will be offset from grant revenue.
• Increase appropriations in the General Grants Fund (SR 120) in the Police Department (PD) by $295,240 from UASI grant funds.
Public Works
City Light and Power, Inc. (CLP) provides contract services for street light maintenance. Part of the street light conversion contract includes a loan for the conversion costs. An appropriation increase is requested as a technical correction to align the budget with FY 13 debt service payments to CLP per the loan amortization schedule.
• Increase appropriations in the General Fund (GP) in the Citywide Activities Department (XC) by $248,761 from fund balance.
• Increase appropriations in the Debt Service Fund (DS 600) in the Public Works Department (PW) by $248,761 from General Fund revenue.
The 25th Annual Dr. Martin Luther King, Jr. Peace and Unity Parade Celebration (Parade) was held on January 19, 2013, commemorating the legacy of Dr. Martin Luther King, Jr. Council District 6 has approved the use of one-time Uplands Oil discretionary funds to cover unbudgeted Parade expenses in the Parks, Recreation and Marine Department (PR). One-time funds are currently appropriated in the Capital Projects Fund (CP) in the Public Works Department (PW), and an appropriation increase is necessary to transfer the funding to PRo
• Increase appropriations in the General Fund (GP) in the Parks, Recreation and Marine Department (PR) by $19,455 from one-time Uplands Oil Funds.
The City's Municipal Ordinance allows Overweight Vehicles to operate on City streets and highways with a permit issued by the Public Works Department (PW). Court settlement fines and penalties collected from trucking companies found to be in violation of permit conditions will provide funding for $27,325 in street pavement repairs and Public Works' permit program. An appropriation increase is requested for these expenditures and will be offset by one-time revenue.
• Increase appropriations in the Capital Projects Fund (CP) Public Works Department (PW) by $27,325 from one-time court settlement fines and penalties.
As part of the FY 11 Budget, funding for the rehabilitation of the Cherry Beach restroom was budgeted in the Parks, Recreation and Marine Department (PR). Project management has since been transferred to the City Manager Department (CM), and a budget transfer from PR to CM is requested to move the project budget to the managing department.
• Increase appropriations in the Tidelands Operations Fund (TF 401) in the City Manager Department (CM) by $80,660 from a transfer of project funds.
• Decrease appropriations in the Tidelands Operations Fund (TF 401) in the Parks, Recreation and Marine Department (PR) by $80,660 for a transfer of project funds.
Proposition 1 B (Transportation Bond), passed by the voters in November 2006, authorized the State to sell general obligation bonds to fund transportation projects to relieve congestion, improve the movement of goods, improve air quality, and enhance the safety and security of the transportation system. The Public Works Department (PW) received $96,844 more than originally budgeted, and an appropriation increase is requested to expend the additional bond revenue.
• Increase appropriations in the Transportation Fund (SR 182) in the Public Works Department (PW) by $96,844 from bond revenue.
In 2011, the Parks, Recreation and Marine Department (PR) successfully applied for a competitive grant from the State of California Department of Parks and Recreation for the development of Alamitos Park. The grant funding was originally budgeted in PR and the project has since been managed by the Public Works Department (PW). A budget transfer from PR to PW is requested to move the project budget to the managing department.
• Decrease appropriations in the Capital Projects Fund (CP) in the Parks, Recreation & Marine Department (PR) by $2,833,281 for a transfer of project funds.
• Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $2,833,281 from a transfer of project funds.
In FY 11, the City and former Redevelopment Agency (RDA) embarked on the planning, designing, and construction for the Pine Avenue Streetscape Improvement (Refresh) Project to enhance the safety and attractiveness of Pine Avenue. The project improvements and revitalization efforts will transform the Downtown public ri~ht-of-way from Seaside Way to Ocean Boulevard; Ocean Boulevard to yth street; and yt Street to Anaheim Street through landscaping, new street repair and paving, sidewalk and curb improvements, street and pedestrian lighting, and wayfinding signage. An appropriation increase is requested for these projects and will be offset by $550,000 from the Downtown Long Beach Associates (DLBA), $1 million from the Community Development Block Grant (CDBG) and $50,000 in Gas Tax Street Improvement Funds.
• Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $1,550,000 from a DLBA contribution and CDBG grant funds.
• Increase appropriations in the Gas Tax Street Improvement Fund (SR 181) in the Public Works Department (PW) by $50,000 from fund balance.
Technology Services
In October 2011, the City Council approved $150,000 in one-time FY 11 Uplands Oil Funds for the Technology Services Department (TS) to upgrade the City's web site content management system (CMS). On February 19, 2013, the City Council approved contracts required to initiate this project in an amount not-to-exceed $212,486. Of that amount, $62,486 is currently unbudgeted. TS will recover costs through charges to user departments as follows: Harbor Department (HA); Long Beach Gas and Oil Department (GO), Public Works Department (PW), Long Beach Airport Department (AP), and the Development Services Department (DV).
• Increase appropriations in the General Services Fund (IS 385) in the
Technology Services Department (TS) by $62,486 from user charges.
As part of the FY 13 Budget, the City Council authorized the use of $1,300,000 in onetime funds for the improvements to the Land Management & Revenue (LMR) System (LMR), expanding the use of the LMR System, and the replacement of the Notes Assignment Tracking System (NATS). FY 13 one-time funds are currently budgeted in the General Fund (GP) in the Citywide Activities Department (XC). An appropriation increase is requested to reflect the transfer from GP to the General Services Fund and will be offset from one-time revenue.
• Increase appropriations in the General Services Fund (IS 385) in the Technology Services Department (TS) by $1,300,000 from one-time revenue.
Citywide Activities
On May 7, 2013, the City Council approved a transfer of an additional $18,000 from Uplands Oil Funds to Council District 9 to establish the Uptown PBID. On February 5, 2013, the City Council approved the transfer of $15,966 of unspent one-time Uplands Oil Funds to Council District 8. An appropriation increase is requested for a technical correction to appropriate these transfers from the Capital Projects Fund (CP) to the General Fund (GP).
• Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $33,966 from one-time Uplands Oil Funds.
On June 11, 2013, City Council authorized the allocation of $6.4 million in one-time revenue. City Council directed 5 percent of the total revenue, or $322,248, to be placed in a reserve for unfunded liabilities. The remaining amount of $6.1 million was evenly divided among the nine Council Districts for one-time infrastructure projects including residential street repaving, slurry seal, sidewalk repairs and Parks, Recreation and Marine CIP projects. An appropriation increase is requested to formally implement the transfers from the designated one-time funding sources and to budget the previously authorized expenditures.
• Increase appropriations in the General Fund (GP) in the Citywide Activities Department (XC) by $6,122,707 from one-time revenue.
• Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $6,122,707 from one-time revenue.
The 2009-10 State budget package suspended Prop1A, which allowed the State to borrow property tax revenue from cities, counties and special districts. The State was required to repay this obligation by June 30, 2013. To backfill this lost revenue in FY 10, the General Fund (GP) received authorization to take a loan from the Subsidence Fund (NX 421) to be repaid in 2013, when GP is made whole by the State. The State repayment to the City was received with the July 22, 2013 property tax remittance. An appropriation increase is requested to budget and implement the repayment. There is no net impact to the GP.
• Increase appropriations in the General Fund (GP) in the Citywide Activities Department (XC) by $10,799,559 from revenue for repayment to the Subsidence Fund.
SUGGESTED ACTION
Approve recommendation.
Respectfully Submitted,
JOHN GROSS
DIRECTOR OF FINANCIAL MANAGEMENT
APPROVED:
PATRICK H. WEST
CITY MANAGER