Budget adjustments are presented to the City Council periodically for review. These adjustments represent the appropriation of items previously approved by the City Council during the fiscal year, or staff recommended adjustments for City Council consideration. The recommended adjustments to the City Operating Budget are listed in City - Exhibit A. These adjustments are separated by funding source and the accounts are identified as either revenue or expenditure accounts.
In the Police Department, the funding of the School Resources Officer assigned to Brea-Olinda High School ($161,703) was transferred from the Narcotic Asset Seizure Fund (231) to the General Fund (110). Traditionally, Fund 231 has supported this position, but for the past couple of years, narcotics asset seizure revenues have been declining due to changes in criminal narcotics transactions and recent changes at the state legislative level which have significantly curtailed the types of asset seizure revenues state and local governments are eligible to receive. Therefore, for FY 2017-18 and moving forward, Fund 231 can no longer support this valuable position and the most reasonable funding source is the General Fund (110).
The Fire Department continues to respond to mutual aid throughout California. Fortunately, Fire Administration has been diligent in seeking reimbursement for costs incurred. Mutual aid responses included: the 2018 January Storms in Montecito and the Aliso Fire in Orange County. These strike team responses resulted in the Fire Department's Overtime Budget and other operating costs to increase by $76,874. This cost is fully offset by reimbursements. These adjustments also include budget adjustments for the Community Facility Districts (CFDs) for the Blackstone and La Floresta Developments (Funds 360 and 361). The net budget increase is as follows: Blackstone - $83,509 and La Floresta - $63,804. Actual salary and benefits for both Police and Fire Services were higher than expected. These costs represent the CFDs' fair share for these services. The Public Works Department had budgeted savings to help offset these costs; however, the remaining balances are being taken from fund reserves. Revenues collected were not sufficient to cover these additional expenditures.
For Capital Improvement Project #7318 - Kraemer Blvd. and Lambert Road Rehabilitation (Phase 3), there were changes in funding. Federal Grants as well as Measure M Fund Transportation Tax (260), the Urban Runoff (410), and the Sewer Utility (430) Funds had a decrease in funding of $181,261; $305,585; $54,000; and $2,472 respectively. Meanwhile, the Water Utility Fund (420), State Grants, and Miscellaneous Government had and increase in funding of $39,950; $158,350; and $52,491. As presented in the CIP budget adjustments, there is an overall reduction of expenditures of $292,527 for this project.
In the Risk Management Fund (470), budget adjustments are needed for unanticipated general liability claims ($83,410) and unanticipated workers' compensation claims ($262,410) paid. These costs were able to be covered by unbudgeted refunds received from prior year expenses of $318,400 and greater than anticipated refunds for expenses of $31,760. Overall, the net impact to the Risk Management Fund is $4,340 positive.
The City's Fiscal Policies state, " Expenditures budgeted in one fiscal year may be carried over to the next fiscal year automatically if the purpose for which the expenditure was budgeted has not been completed. Such carryovers shall not occur for more than two budget cycles without Council approval (with the exception of PEG Fees and Seagraves Fire Truck Maintenance)." However, there are a number of carryovers that should be included in these exceptions. For example: CASP (Certified Access Specialist Program) Fee Training ($13,541), Olinda Museum Donations ($18,107), Senior Center Case Management Funds ($2,300), Senior Center Donations ($20,649), Senior Transportation Program Overhead ($51,131), Public Art Trust Account ($21,880), and Housing Rehabilitation Funds ($117,448). These carryovers are tied to revenues that are for a specific purpose. This funding cannot always be spent within a two budget cycle. Staff will update the City's Fiscal Policies to add these carryovers to the exception list when the next budget is adopted.
In addition, there are three projects that staff wishes to carryover for an additional two-year cycle. These include the carryovers for the Brea Envisions Project ($96,484), the Senior Center Room A and Cabinet Project ($17,858), and the upgrade to the Utility Billing Software ($30,960). Council's direction was to use the excess money from the original project to help with the implementation of the ideas that came from Brea Envisions. Staff is unsure if project money will be used in its entirety in Fiscal Year 2018-19; therefore, an additional two years is being requested to carryover this funding. Also, there have been delays in the Senior Center Room A and Cabinet Project due to lack of availability of Building Maintenance Staff. Likewise, Utility Billing staff has experienced a number of setbacks (primarily with the vendor) with this upgrade and are moving toward upgrading to the latest version of the software to avoid the generation of several custom modifications to the product. The release of the latest version is anticipated to be in December 2018. Therefore, staff is unsure if the remainder of the money will be spent by the end of the current fiscal year. With City Council's approval, staff will carryover these funds and the FY 2018-19 Budget will be adjusted accordingly. |
The City Operating Budget adjustments for the General Fund (110) in Exhibit A resulted in an increase in revenues of $76,874 and an increase in expenditures and transfers-out of $238,577, for a net General Fund increase in expenditures and transfers-out of $161,703 . The City Operating Budget adjustments for all funds resulted in an increase in revenues and transfers-in of $458,285 and an increase in expenditures and transfers-out of $374,303 for a net increase in revenues and transfers-in of $83,892.
The Capital Improvement Program Budget adjustments in CIP - Exhibit A consists of a decrease in expenditures of $57,162 with a corresponding net decrease in revenues and transfers-in. The adjustments to revenue and transfers-in are as follows:
| Measure M Transportation Tax (260) |
($305,585) |
| Urban Runoff Fund (410) |
(54,000) |
| Water Utility Fund (420) |
39,950 |
| Sewer Utility Fund (430) |
1,343 |
| Traffic Impact Fees Fund (540) |
31,550 |
| State Grants |
158,350 |
| Federal Grants |
(181,261) |
| Miscellaneous Government Grants |
252,491 |
| TOTAL |
($57,162) |
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