TITLE
Recommendation to approve the Fiscal Year 2015 third departmental and fund budget appropriation adjustments in accordance with existing City Council policy. (Citywide)
DISCUSSION
On September 2, 2014, the City Council adopted the Appropriations Ordinance governing the City’s Adopted Budget for Fiscal Year 2015 (FY 15). 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 periodically throughout the year to the City Council for consideration. Please see Attachment A for a Summary of Proposed Adjustments of impacted City funds, Attachment B for a recap of FY 15 General Fund Expenditure Budget Adjustments and Attachment C for a summary of FY 15 Carryover budget adjustments for grants and capital projects of multi-year funds.
This matter was reviewed by Deputy City Attorney Amy R. Webber on August 27, 2015.
TIMING CONSIDERATIONS
The following requests for adjustments to FY 15 departmental and fund appropriations are necessary to reflect changes in operating conditions. City Council action is requested on September 15, 2015 to enable the timely processing of payments.
FISCAL IMPACT
Development Services
Increase appropriations in the General Fund (GF) in the Development Services Department (DV) by $57,000 for maintenance of the Promenade Maintenance District, offset by contributions from Promenade Parcel Owners.
The Development Services Department manages the Promenade Maintenance District (District), which ensures maintenance and repair of the Promenade between Ocean Boulevard and Third Street, excluding Promenade Square Park and Harvey Milk Promenade Park. The costs associated with this maintenance are offset by quarterly contributions from developers designated as Promenade Parcel Owners, who previously entered into agreements obligating participation in the District. The annual expense for maintenance is paid from the Department’s General Fund and is offset by revenue; however, the annual revenue and expense of $36,000 has never been budgeted. In FY 15, the Department incurred a $21,000 expense to replace broken glass on the Aerial Plaza sculpture on the mid-block of the Promenade. Therefore, additional appropriation totaling $57,000 is requested at this time.
Increase appropriations in the Debt Service Fund (DS 600) in the Development Services Department (DV) by $1,700,000 for the repayment of the Lois Apartment loan, offset by a transfer from the Housing Services Fund.
The Long Beach Community Investment Company (LBCIC) recently authorized the repayment of the Lois Apartment acquisition and rehabilitation loan to the California Department of Housing and Community Development. While sufficient appropriation for the repayment is available in the Housing Services Fund, accounting standards require governmental fund debt be passed-through the Debt Service Fund. This is a technical adjustment.
Increase appropriations in the Development Services Fund (EF 337) in the Development Services Department (DV) by $50,000 for restoration and relocation of a former railroad station building, offset by Construction and Demolition forfeiture funds.
On April 15, 2014, the City Council authorized $418,610 in funding for the relocation and restoration of a former railroad station building to Willow Springs Park. Costs associated with the move and site preparation exceeded original estimates and additional appropriation is needed to complete foundation repair work and ensure the stability of the relocated structure, offset by funds available from Construction and Demolition forfeiture funds.
Disaster Preparedness and Emergency Communications
Increase appropriations in the General Grants Fund (SR 120) in the Disaster Preparedness and Emergency Communications Department (DC) by $11,130 for Homeland Security Projects, offset by grant revenues;
Increase appropriations in the General Grants Fund (SR 120) in the Health and Human Services Department (HE) by $2,219 for Homeland Security Projects, offset by grant revenues;
Increase appropriations in the General Grants Fund (SR 120) in the Fire Department (FD) by $63,233 for Homeland Security Projects, offset by grant revenues; and,
Increase appropriations in the General Grants Fund (SR 120) in the Police Department (PD) by $118,759 for Homeland Security Projects, offset by grant revenues.
On March 4, 2014, the City Council approved the City’s federal 2013 Urban Area Security Initiative (UASI 2013) grant award for $3,588,899. On July 21, 2015, the City Council approved an appropriation adjustment to align actual expenses between City departments to maximize the total grant award. Subsequent to the last adjustment, additional UASI 2013 grant funds have become available from the Los Angeles/Long Beach region for the City. Therefore, an appropriation increase of $195,341 is requested for the Disaster Preparedness and Emergency Communications, Fire, Health and Human Services and Police Departments. These additional grant funds will offset grant eligible expenditures made by each department within the grant period.
Fire
Increase appropriations in the General Fund (GF) in the Fire Department (FD) by $70,587 for expenses related to the fire services offered at the Long Beach Grand Prix, offset by reimbursement revenue.
The Long Beach Grand Prix is the single largest event in the City of Long Beach. The Grand Prix includes the main IndyCar race, Formula D drifting series and, beginning in 2015, the Formula E race was added. The Fire Department provided assistance for these race car events, including equipment placement, operational staging, systems testing and, most important, dedicated Advanced Life Support (ALS) and Basic Life Support (BLS) services. Increased unbudgeted staffing costs were incurred this year to fully support these events. These costs will be fully reimbursed by the event promoters.
Increase appropriations in the General Grants Fund (SR 120) in the Fire Department (FD) by $260,000 reflecting additional funding received from the County of Los Angeles for federal 2014 State Homeland Security Grant Program, offset by grant revenues.
On July 21, 2015, the City Council authorized the City Manager to receive and expend Department of Homeland Security grant funds for the federal 2014 State Homeland Security Grant Program totaling $320,000. Since that time, additional funds of $260,000 have become available and are being awarded to aid the purchase of tactical emergency medical support equipment.
Parks, Recreation & Marine
Increase appropriations in the General Fund (GF) in the Parks, Recreation and Marine Department (PR) by $10,000 to purchase building materials and supplies, offset by revenues from the Derrickson Living Trust.
The Parks, Recreation and Marine Department (PR) maintains the Derrickson Living Trust. In provision with the trust requirements, Animal Care Services (ACS) purchased building materials and supplies in the amount of $10,000.
Increase appropriations in the General Fund (GF) in the Parks, Recreation and Marine Department (PR) by $30,000 to purchase medical supplies and veterinary care, offset by revenues from the Medication/Veterinary Care Trust.
The Parks, Recreation and Marine Department (PR) maintains the Medication/Veterinary Care Trust, which was established specifically for the purchase of medical supplies and veterinary care for animals. In provision with the trust requirements, Animal Care Services purchased medical supplies and other contractual services in the amount of $30,000.
Increase appropriations for the spay/neuter voucher program in the General Fund (GF) in the Parks, Recreation and Marine Department (PR) by $65,000, offset by revenues from the Dr. Eslinger Memorial Trust and the Impounded Non-Spayed/Unneutered Animals Trust.
Animal Care Services (ACS) issues vouchers to the public to reduce the cost of a spay/neuter procedure at participating veterinary clinics. An appropriation increase is requested for the ACS spay/neuter voucher program, and will be offset with $45,000 from the Dr. Eslinger Memorial Trust and $20,000 from the Impounded Non-Spayed/Unneutered Animals Trust.
Increase appropriations in the General Fund (GF) in the Parks, Recreation and Marine Department by $21,633 to reimburse First Serve, Inc., for repairs and maintenance of the City’s two tennis centers, offset by revenues from the Tennis Trust Account.
The Parks, Recreation and Marine Department (PR) has two tennis centers, Billie Jean King (BJK) and El Dorado Park (EDP). First Serve, Inc., has a permit for the operation and management of both tennis centers. All revenue derived from tennis-related fees, set by the Parks and Recreation Commission, is 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. Pursuant to Trust requirements, hand dryers were installed, court windscreens were replaced and bubbling paint was resurfaced on the courts at the tennis centers.
Increase appropriations in the General Fund (GF) in the Parks, Recreation and Marine Department (PR) by $23,302 for improvements at Los Altos Plaza Park, offset by donations from the Park Estates Home Owners Association.
The Parks, Recreation and Marine Department (PR) received a donation from the Park Estates Home Owners Association (PEHOA), in the amount of $23,302, for improvements at Los Altos Plaza Park. These improvements included the installation of a new streetlight, two new circuit breakers, a concrete pad and a picnic table.
Increase appropriations in the General Fund (GF) in the Parks, Recreation and Marine Department (PR) by $24,750 for Movies in the Park, offset by sponsorship from Signal Hill Petroleum.
Signal Hill Petroleum has sponsored Movies in the Park since 2005 and, this year, has provided Partners of Parks with $27,500 for movies shown at various park sites in the City. Partners of Parks retains 10 percent of the sponsorship as an operational fee. The remaining amount of $24,750 has been deposited in the General Fund in support of program staffing.
Increase appropriations in the Tidelands Operations Fund (TF 401) in the Parks, Recreation and Marine Department (PR) by $47,500; and increase appropriations in the Special Advertising and Promotion Fund (SR 133) in the Parks, Recreation and Marine Department (PR) by $30,915 for the Municipal Band, offset by sponsorships and donations.
The Parks, Recreation and Marine Department (PR) is requesting an appropriation increase in the amount of $78,415 to fund the 2015 Municipal Band Summer Concert Season. The department does not appropriate the full fundraising commitment from Partners of Park at the beginning of the fiscal year due to the variability of pass-the-bucket and other donation revenues. Revenues generated from sponsorships and private donations in the amount of $78,415 will offset this appropriation increase.
Increase appropriations in the General Fund (GF) in the Parks, Recreation and Marine Department (PR) by $72,702 for various summer programs, offset by reimbursement revenue.
The Parks, Recreation and Marine Department (PR) incurs expenses related to the summer field trip program in the various Summer Camps, the cost of t-shirts purchased by youth sports participants and classes held at the Nature Center. The department has received various reimbursement revenues to offset these expenses.
Decrease appropriations in the Marina Fund (TF 403) in the Parks, Recreation and Marine Department (PR) by $16,900,000 for the unused Harbors and Watercraft Revolving Fund Loan.
On March 17, 2015, the City Council accepted a Harbors and Watercraft Revolving Fund Loan of $16,900,000 provided by the State Department of Parks and Recreation Division of Boating and Waterways (DBW) for the Alamitos Bay Marina rebuild project. On May 5, 2015, the City Council authorized the issuance of Marina Revenue Bonds for the rebuild project and to prepay previous DBW loans. The issuance of bond financing precludes the need for the City to draw on the current loan amount, and the appropriation is no longer needed.
Police
Increase appropriations in the General Fund (GF) in the Police Department (PD) by $216,225 for the purchase of technology and facility repair, offset by Asset Forfeiture funds.
The Chief of Police is authorizing the use of $216,225 in State and Federal Asset Forfeiture funds for the purchase of the unbudgeted software licenses and maintenance, replacement of Crime Lab equipment, investigative field technology, and miscellaneous facility repair.
Increase appropriations in the General Fund (GF) in the Police Department (PD) by $42,000 for various at-risk youth programs and overtime for a Youth Explorer Advisor and vehicle maintenance, offset by Asset Forfeiture funds.
The Chief of Police is authorizing the use of the $42,000 in State Asset Forfeiture funds - Youth Intervention/Prevention for at-risk youth programs, including the National Association for the Advancement of Colored People (NAACP)'s Afro-Academic, Cultural, Technological and Scientific Olympics (ACTSO), Long Beach Bar Foundation’s Short Stop Program, California Gang Investigators, California for Equality and Justice Bridge Program, and the Operation Jump Start Program. Additional appropriations will fund overtime for the Youth Explorer Advisor and vehicle maintenance for the Search the Rescue Youth Van.
Increase appropriations in the General Grants Fund (SR 120) in the Police Department (PD) by $370,628 for front-line law enforcement efforts, offset by the State COPS grant.
On July 21, 2015, the City Council approved the State of California Citizens Option for Public Safety Program funding from the County of Los Angeles Supplemental Law Enforcement Services Fund (State COPS) of $244,615 for the grant year 2015. The Police Department received an additional $370,628 for grant year 2015 from State COPS funds, bringing the total to $615,243. These State COPS funds will be used for front-line law enforcement efforts, including equipment purchases for a total of $370,628.
Increase appropriations in the General Fund (GF) in the Police Department (PD) by $4,640 for various expenses related to prisoner welfare, offset by revenue from the Prisoner Welfare Trust account.
The Chief of Police is authorizing the use of Prisoner Welfare Trust funds to cover $4,640 in various expenses related to prisoner welfare in the Police Department jail. The expenses include installation of new monitors and rewiring of the jail security system.
Public Works
Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $56,000 to transfer FY 15 one-time infrastructure funds from the Sixth Council District to the General Fund (GP) in the Human Resources Department to support community services related to improvement and engagement activities in the Sixth Council District for a one-year period.
On July 21, 2015, the City Council approved the transfer of $56,000 from the Sixth Council District’s FY 15 one-time infrastructure funding in the Capital Projects Fund to the General Fund in the Human Resources Department to support community improvement and community engagement activities for a one-year period. An appropriation increase is requested to formally implement the transfer from the Capital Projects Fund in the Public Works Department to the General Fund in the Human Resources Department.
Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $230,000 to repair the roof at the Expo Building and other tenant improvements, offset by claim reimbursement revenue.
In FY 15, the Public Works Department received $398,794 from an insurance claim reimbursement, of which $230,000 will be used towards the refurbishment and repair of the Expo building located on 4321-4325 Atlantic Avenue. The project includes repairing the roof to prevent further leaks and water damage, as well as construction of tenant improvements. Remaining funds are included as part of the FY 16 Budget and will be used towards future facility repairs, in addition to maintenance costs associated with former Successor Agency properties.
Increase appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $7,079 for Southern California Edison improvements on Pine Avenue, offset by cost-sharing revenue.
On January 7, 2014, the City Council awarded contracts for the improvement of Pine Avenue from Seaside Way to Anaheim Street (Pine Avenue Improvements). To assist with additional improvements, Southern California Edison (SCE) installed a service conduit along Pine Avenue and at 110 W. Ocean Boulevard. As a result, the City and property owner at 110 W. Ocean Boulevard negotiated a cost-sharing agreement for the work. The total cost for the conduit installation is $11,476, of which 110 Ocean Boulevard, LLC, agreed to fund $7,079. The City’s portion of $4,397 is currently appropriated in the Gas Tax Street Improvement Fund.
Citywide Activities
Furlough Costs for IAM represented employees
Increase appropriations in the General Fund (GF) in the Citywide Allocations Department (XI) by $2,870,628 for furlough back payment and interest costs, offset by release of reservation.
On December 9, 2014, the City Council adopted a Resolution that rescinded RES-09-0042 and reimbursed the affected labor group, International Association of Machinists and Aerospace Workers (IAM) employees, for furlough days taken in 2009. A total of $3.8 million in furlough back payments and interest costs have been paid in the current fiscal year. An appropriation increase is needed since the General Fund portion of $2,870,628 is unbudgeted, offset by funds from reserves created during FY 13 and FY 14 specifically for this purpose. The other affected funds (Airport, Gas, Harbor, Water, Sewer and Tidelands) have sufficient appropriation; therefore, no appropriation increases are necessary for those funds.
Gas Charges
Increase appropriations in the General Fund (GF) in the Police Department (PD) by $21,811; increase appropriations in the Parks, Recreation & Marine Department (PR) in the General Fund (GF) by $92,062; increase appropriations in the Fire Department (FD) in the General Fund (GF) by $37,384; increase appropriations in the Health and Human Services Department (HE) in the General Fund (GF) by $14,542; increase appropriations in the Library Services Department (LS) in the General Fund (GF) by $9,393; increase appropriations in the Public Works Department (PW) in the General Fund (GF) by $2,518 to cover unbudgeted gas expenses; and decrease appropriations in the General Fund (GF) in the Citywide Activities Department (XC) by $177,710, offset by savings due to lower than projected contractual obligations in other programs.
General Fund departments receive charges from the Long Beach Gas and Oil Department through the commercial billing system for the usage of gas in City facilities. Prior to the preparation of the FY 15 budget, these charges were unbudgeted in the General Fund. Department appropriations were added to the FY 16 Budget to cover these expenses, but remain unbudgeted for FY 15. An appropriation increase of $177,710 is requested to provide General Fund departments the budget to cover the gas charges.
Transfer to Successor Agency
Increase appropriations in the Capital Projects Fund (CP) in the Citywide Activities Department (XC) by $654,266, for bond expenditures offset by prior year revenue. Decrease appropriations in the Capital Projects Fund (CP) in the Public Works Department (PW) by $654,266 to remove redundant appropriation.
On July 10, 2007, the City Council approved reimbursement agreements between the City and the former Redevelopment Agency to reimburse the agency for expenses related to the design and construction of parks and park facilities using bond proceeds from the 2006 Open Space Bonds. A technical correction is necessary to match appropriations to expenditures for these bond expenses in the Capital Projects Fund in the Citywide Activities Department to cover transfers of $654,266 to the Successor Agency made in FY 13 and FY 14, offset by prior year revenue. A decrease of appropriation in the same amount from the Capital Projects Fund in the Public Works Department is also requested to remove unnecessary appropriation.
Multi-Year Funds Carryover
Each fiscal year, appropriation increases and decreases are necessary to make technical corrections related to grants and capital projects Citywide. Budget amounts not spent by the end of a fiscal year for multi-year grants are carried forward in the ensuing fiscal year. The FY 15 Adopted Budget contained estimated carry-over amounts. Attachment C lists the adjustments that require City Council approval by department and by fund for FY 15. The net adjustment for the affected funds and departments is an appropriation increase of $107,383,025. All of the departments and funds are grant, capital projects or bond proceeds and, therefore, restricted to their related projects and do not impact the General Fund.
SUGGESTED ACTION
Approve recommendation.
Respectfully Submitted,
JOHN GROSS
DIRECTOR OF FINANCIAL MANAGEMENT
APPROVED:
PATRICK H. WEST
CITY MANAGER