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HomeMy WebLinkAbout8.1 Preliminary Budget for Fiscal Years 2024-25 and 2025-26r DUBLIN CALIFORNIA STAFF REPORT CITY COUNCIL DATE: April 16, 2024 TO: Honorable Mayor and City Councilmembers FROM: Linda Smith, City Manager SU B.ECT: Preliminary Budget for Fiscal Years 2024-25 and 2025-26 Prepared by: JayBaksa, Finance Director EXECUTIVE SUMMARY: Agenda Item 8.1 The City Council will receive an overview of the preliminary two-year General Fund budget, as well as an update to the City's 10-year Financial Forecast. The 2024-2029 Capital Improvement Program is presented under a separate item. STAFF RECOMMENDATION: Receive the report and provide direction in preparing the final Fiscal Year 2024-25 and Fiscal Year 2025-26 Budget. FINANCIAL IMPACT: The Preliminary Budget reflects total General Fund revenues of $128,267,803 and total expenditures of $109,071,411 in Fiscal Year 2024-25; and revenues of $133,691,580 and expenditures of $112,444,154 in Fiscal Year 2025-26. Transfers out to capital projects and contributions to Internal Service Funds total $6,612,698 and $17,551,900, respectively. This results in additions to General Fund Reserves of $12,583,693 in Fiscal Year 2024-25 and $3,695,527 in Fiscal Year 2025-26. If there are any additional initiatives that the City Council wishes to incorporate, those will be included in the budget proposal which will receive final consideration no later than the first meeting in June. DESCRIPTION: The City of Dublin utilizes a biennial budget process, in which a comprehensive budget document is prepared that establishes high-level priorities and specific departmental goals for a two-year period. The second year of the cycle is the "update year", in which projections are revised and significant changes highlighted, while the original document continues to serve as the guiding financial plan. This year's budget cycle represents the first year of a new biennial budget process. Page 1 of 10 179 As in prior years, this report focuses on the General Fund, as there are no major budgetary changes proposed in other funds. Also included in the report is the updated 10-Year General Fund Forecast, which provides the context for the two-year budget proposals. Budget and Forecast Summary The preliminary budget is balanced in Fiscal Years 2024-25 and 2025-26, with a General Fund operating surplus of $19,196,391 in the first year, and $21,247,427 million in the second year, before contributions to capital projects and preventative maintenance. After transfers, reserves are increasing $12,583,693 in Fiscal Year 2024-25 and $3,695,527 in Fiscal Year 2025-26. Changes by categories are explained in the section below. Revenue Assumptions Property Tax Revenue Fiscal Year 2024-25 - Increase of $3,329,641 (5.6%) Fiscal Year 2025-26 - Increase of $2,922,909 (4.6%) The increase in Property Tax revenue in both fiscal years is based on projections from the City's consultant and is calculated with a combination of an annual increase of 2% to the assessed property value (the maximum allowable by Proposition 13) and an increase in valuation due to home sales and new construction. Staff also budgets for a delinquency rate of 1%. Sales Tax Fiscal Year 2024-25 - Increase of $540,465 (1.8%) Fiscal Year 2025-26 - Increase of $867,440 (2.8%) The increase in Sales Tax revenue for both fiscal years is based on projections from the City's consultant as well as local and statewide economic trends. In Fiscal Year 2024-25, Sales Tax is projected to increase 1.8%, despite a minor decrease of 0.3% in the Auto & Transportation sector. All other industry groups in Fiscal Year 2024-25 are projected to remain flat or have increases led by both the Business -to -Business and Restaurant and Hotels sectors. For Fiscal Year 2025-26, economists are projecting increases in all business sectors, especially in the Auto & Transportation and Building & Construction sectors. Development Revenue Fiscal Year 2024-25 - Increase of $827,627 (12.0%) Fiscal Year 2025-26 - Increase of $988,502 (12.8%) Development revenue includes permitting fees and payments for planning and engineering services provided by the City. Revenue projections for both fiscal years are based on the timing of development projects. The receipt of revenues and expenditures on corresponding services do not happen simultaneously. Plan check costs are typically incurred approximately 12 months after revenue has been received, meaning that as development decreases, the associated decrease in costs will lag. In anticipation of this, the City has maintained the Service Continuity reserve (currently at $3.15 million) to cover costs during that lag. Page 2 of 10 180 Other Taxes Fiscal Year 2024-25 - Increase of $364,500 (5.4%) Fiscal Year 2025-26 - Increase of $257,250 (3.6%) Other Taxes include Property Transfer Taxes and multiple Franchise Taxes (electric, gas, garbage, cable). Revenue for both fiscal years is projected to increase primarily due to the annual adjustment of garbage rates that is part of the garbage franchise agreement and an increase in gas and electric rates. Charges for Services Fiscal Year 2024-25 - Decrease of $16,480 (0.2%) Fiscal Year 2025-26 - Increase of $199,906 (2.7%) In Fiscal Year 2024-25, Charges for Services are projected to decrease due to an anticipated reduction in Santa Rita reimbursement revenue, whereby the County pays the City for costs incurred when responding to emergency calls at the Santa Rita Jail. The projected decrease is based on operational changes that began in the current fiscal year. The decrease is offset by projected revenue increases from Parks and Community Services programs, which continue to see strong demand. Fiscal Year 2025-26 revenues are projected to increase due primarily to continued increases in Parks and Community Services programs. Interest Fiscal Year 2024-25 - Increase of $122,800 (2.2%) Fiscal Year 2025-26 - Decrease of $26,400 (0.5%) Revenue projections for both fiscal years are based on the current interest rate environment as well as the City's projected fund balance. The City continues to benefit from high interest rates, but Staff and its consultants are closely monitoring the actions of the Federal Reserve and will make any adjustments as needed throughout the year. The increase in Fiscal Year 2024-25 and slight decrease in Fiscal Year 2025-26 is due to an accounting change that is required by the Governmental Accounting Standards Boards (GASB), that changed how revenue received from certain leased properties is accounted for. The revenue received from invested funds is projected to remain flat for both budget years. Rents and Leases Fiscal Year 2024-25 - Increase of $575,552 (34.9%) Fiscal Year 2025-26 - Increase of $48,103 (2.2%) Revenue projections for both fiscal years are based on projected increases from rentals of the City's facilities, sports fields, and picnic areas, which continue to see strong demand for rental spaces. Additionally, the Dublin Arts Center will open in Fiscal Year 2024-25, further increasing revenue by an estimated $181,000. In Fiscal Year 2025-26, Staff is projecting a 2% increase. Other Revenue Fiscal Year 2024-25 - Increase of $729,946 (40.0%) Fiscal Year 2025-26 - Increase of $107,468 (4.2%) Page 3 of 10 181 The Other Revenue category encompasses a wide variety of revenue types received by the City, including Sale of Property, Sponsorship/Donation, and Reimbursements. These revenues can be unpredictable and vary moderately each year. In Fiscal Year 2024-25, an accounting change in how the City pays for Fire Retiree Health will result in an additional $574,552 in expenditures for Fire Services, but this will be offset by additional revenue received as a reimbursement in the same amount, in no net impact to the City. In Fiscal Year 2025-26, Other Revenue is projected to increase 4.2% which includes the Fire Retiree Health accounting change. Other recurring items projected to increase include reimbursement for work performed at Camp Parks through the Intergovernmental Support Agreement (IGSA). Expenditure Proposals Personnel Costs Fiscal Year 2024-25 - Increase of $1,556,252 (11.0%) Fiscal Year 2025-26 - Increase of $649,248 (4.1%) The increase in the Fiscal Year 2024-25 budget is attributed to the net impact of the following: • Addition of an Associate Civil Engineer in the Public Works Department to work on capital projects. The salary is included in the General Fund but will be allocated to Capital Improvement Program (CIP) funds accordingly. • Full year funding for two new positions added in Fiscal Year 23-24 - a Management Fellow and a Code Enforcement Officer, the latter will be offset by a reduction in contract services. • Transfer of 1.0 FTE from the Information Systems Division (Information Technology Fund) to the City Manager's Office (General Fund). • Increase in seasonal staffing costs, which is a result of an increase in the minimum wage as well the need for additional staff due to the demand for Parks and Community Services programs and rentals. • Cost of Living Adjustment (COLA) of 2.9%. The Fiscal Year 2025-26 budget does not include any new positions. Increases are based on a projected 3.5% COLA and an increase in costs for seasonal staff. Benefits Fiscal Year 2024-25 - Increase of $849,124 (15.8%) Fiscal Year 2025-26 - Increase of $248,146 (4.0%) The increase in benefit costs in Fiscal Year 2024-25 is based on an increase in retirement costs, due to the CalPERS loss of 6.1% in 2022. This caused an increase of approximately $350,000 in the City's Fiscal Year 2024-25 unfunded liability payment. Additionally, Staff is projecting increases in premiums, and has incorporated the City's new benefit structure (effective January 1, 2024) for a full year. The Fiscal Year 2025-26 budget includes a $160,000 increase in the CalPERS unfunded liability payment, based on the most current actuarial reports as well as a projected 5% increase to the 2025 health rates. Page 4 of 10 182 Services and Supplies Fiscal Year 24-25 - Increase of $1,509,068 (23.1%) Fiscal Year 25-26 - Increase of $234,768 (2.9%) Services and Supplies expenditures for Fiscal Year 2024-25 are increasing primarily due to higher insurance premiums through PLAN JPA, the City's insurance pool. The increase is consistent with rates throughout the state, in both the public and private sectors. Insurance costs for both Police and Fire are also increasing by a total of $918,000 over the current year amended budget. Additionally, the Public Work's Maintenance division increased the repairs/maintenance budget by approximately $300,000 to account for potential repairs as the City's facilities continue to age. The Fiscal Year 2025-26 Services and Supplies budget is projected to increase 2.9% year -over - year, the result of a projected 10% increase to the City's liability insurance. This increase is a placeholder, as PLAN JPA does not provide anticipated future costs for insurance premiums. This increase is combined with other Services and Supplies expenditures being kept flat, in addition to the removal of one-time costs from Fiscal Year 2024-25, such as costs related to the Dublin Arts Center opening. Contract Services Fiscal Year 24-25 - Increase of $2,380,963 (3.7%) Fiscal Year 25-26 - Increase of $2,405,111 (3.6%) The City contracts for public safety (Police and Fire), maintenance, development, and other miscellaneous services. Police Services The Fiscal Year 2024-25 Police Services budget increases are due to the addition of one Deputy Sheriff as well as the inclusion of full -year funding of the Crime Technician position that was added in the current year. Additionally, personnel costs are increasing due to annual COLA and benefit cost increases. Lastly, the City's projected dispatch costs are increasing by $534,991 (25.7%) over the current year adopted budget, attributed primarily to an increase in call volume of 19.9%. The Fiscal Year 2025-26 cost projection includes a 3% increase to the contract based on wage and benefit agreements. FY 23-24 24-25 1 25-26 *Includes Contract $ All Funds $26,690,768 $27,472,696 $28,345,187 Police Services Contract* Increase $ Increase % Contract $ General Fund $25,680,985 $781,280 2.9% $26,794,925 $872,492 3.2% $27,633,647 Increase $ Increase % $1,113,940 4.4% $932,722 3.5% Insurance Premiums, which are budgeted under Services and Supplies. Page 5 of 10 183 Fire Services The Fiscal Year 2024-25 Fire Services budget increases are due to annual COLA and benefit costs. Additionally, the budget is going up by $101,802, (40.3%) due to an increase in the County Overhead and Indirect Services rate charged to the City. The County Overhead rate consists of supportive services costs, such as County Legal Services, Human Resource Services and Equipment Maintenance. This cost is spread to all agencies that contract with Alameda County Fire. Finally, overall appropriations for the Fire Services Budget are increasing by $574,552, due to a change in the accounting of how Retiree Health costs are paid and subsequently reimbursed to the City. All such expenditures will be wholly offset by revenue received from Alameda County Fire. Fire Services costs in Fiscal Year 2025-26 are projected to increase by 6.4%, based primarily on staffing cost increases and estimated benefit increases. FY 23-24 24-25 25-26 *Includes Contract $ (All Funds) $16,886,057 $18,380,866 $19,568,277 $1,494,809 $1,187,411 Fire Services Contract* Increase $ Increase Contract $ Increase $ Increase % % General Fund $16,450,447 8.1% $18,101,287 $1,650,840 9.1% 6.5% $19,286,311 $1,185,024 6.5% Insurance Premiums, which are budgeted under Services and Supplies. Maintenance (MCE) The budget for maintenance services in both fiscal years includes the following: • Increases in personnel costs: four additional FTEs related to increase in City assets, including a Lead Foreman position to help provide proactive maintenance services. • Increases in rates paid to all position levels. • Additional costs associated the Dublin Arts Center, Wallis Ranch Community Park, Iron Horse Nature Trail, and four new medians (two on Fallon Road and two on Central Parkway), and Jordan Ranch Neighborhood Park. • Expanded hours for special events which include the St. Patrick's Day Festival, Trunk or Treat, Farmers' Market, and marching band events. FY 23-24* 24-25 25-26 Maintenance Contract Contract $ Increase $ (All Funds) $9,162,260 $10,110,504 $948,244 $10,556,881 $446,377 Increase % 10.0% 4.4% *Does not include One -Time Capital Improvement Costs Contract $ General Fund $7,931,896 $8,782,859 $9,189,345 Increase $ Increase % $850,963 10.7% $406,486 4.6% Other contract services include Library Services, Crossing Guards, City Attorney, and Animal Services, in addition to other operating contracts services such as recreation instructor contracts, non-MCE street maintenance contracts, and finance and administration consulting services. The overall increases in Contract Services are being partially offset by decreases in departmental Page 6of10 184 development contracts, due to the timing of projects and funding for one-time projects that was included in the current year budget, such the update to the Economic Development Strategy and Economic Development Element to the General Plan, the User Fee Study, and the Climate Action Plan. Capital Outlay Fiscal Year 2024-25 - Increase of $326,388 (60.2%) Fiscal Year 2025-26 - Decrease of $613,000 (70.5%) Capital Outlay items are typically one-time expenditures. The Fiscal Year 2024-25 Budget includes the purchase of equipment by Police Services for their "Drone as a First Responder" program, costs to update the alerting system at Dublin fire stations, a vehicle for Code Enforcement, and equipment for special events, sports programs, the Shannon Center, and The Wave. The Fiscal Year 2025-26 projection includes additional equipment for the drone program, special events, and The Wave. Transfers Out The Fiscal Year 2024-25 Budget includes transfers out of $2,000,000 to the Internal Services Fund - Facilities for preventive maintenance and $4,612,698 to capital improvement projects. Of the amount for capital projects, $1,695,229 comes from Committed/Assigned Reserves and $2,917,469 from Unassigned Reserves. The Fiscal Year 2025-26 Budget includes another $2,000,000 to the Internal Services Fund - Facilities for preventive maintenance, as well as $15,551,900 to capital improvement projects. Of the amount for capital projects, $8,450,000 comes from Committed/Assigned reserves and $7,101,900 from Unassigned Reserves. Capital projects funded by the General Fund are shown in Attachment 3. 10-Year Forecast The 10-Year General Fund Forecast serves as the foundation of the annual budget process in terms of guiding the City's use of resources now to prepare for the future. Staff continues to monitor ongoing revenue sources that fund ongoing costs and how those impact the General Fund over time. The General Fund operating budget is balanced in the two-year budget period. Incorporating the information from this budget cycle into the 10-Year Forecast, however, shows a projected operating deficit starting in Fiscal Year 2031-32, as illustrated in the chart. Revenue and expenditure assumptions are discussed below. Page 7 of 10 185 10-Year Forecast ($ in thousands) • 24-25 25-26 26-27 27-28 28-29 29-30 Property Taxes Sales Tax Rentals & Leases Intergovernmental imm Charges for Svcs Other Interest 30-31 31-32 32-33 1 33-34 Development r., Other Taxes Licenses & Permits Fines 200,000 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 Total Expenditures Forecast Assumptions It should be noted that, while conservative assumptions have been used in the City's major revenue categories, a full recession is not included in the 10-year period. While it is difficult to project what impact a recession might have on the City's finances, Staff assumes that a major downturn (using the same impacts as the recession of 2009) could result in a loss of 15% in Sales Tax revenue in the first year and a loss of 4.4% in Property Tax revenue in the second. Using the current budget, this equates to a loss of $7.1 million. Revenue Sales Tax Property Tax Total FY 23-24 Amended Budget $29,995,900 $59,896,000 $89,891,900 Percentage Lost 15.0% 4.4% Revenue Lost $4,499,385 $2,635,424 $7,134,809 Revenue Property Tax • Years 3-5: Between 3.75% - 5.25% growth annually based on estimates provided by the City's Property Tax consultant, which includes the following assumptions: o CPI adjustment: 2% increase (out of a maximum of 2%) throughout the forecast. Page 8 of 10 186 o Transfer of ownerships: growth based on historical averages. o Prop 8 recapture: minimal increase due to large Prop 8 recapture already occurring. • Years 5-10: 2.5% growth annually. Sales Tax • 2.5% growth annually. • Reduction of $2.5 million starting in FY 2026-27. In December of 2023 the City was notified of an accounting change directed by the State that reallocated certain auto sale, resulting in an increase of $2.5 million to Dublin. Staff recommends treating this revenue as one-time in nature. • All sharing agreements have been factored in. Development Revenues • Based on development project projections. • Steady declines beginning in year 4 through year 10 as the community nears build -out. Charges for Services • 2% growth annually as an inflationary factor. Interest • Decrease beginning in Year 3, with further decreases annually as the City spends General Fund Reserves and as interest rates decrease. All Other Revenue • 0% - 3% growth annually. Expenditures Personnel • No new positions. • COLA: up to 3.5% annually. • Benefit increases of 5% to retirement and health care. Services and Supplies • 2% increase per year as an inflationary factor. Internal Services Funds • 10% annually to build up balances for future maintenance needs. Contracted Services • Annual increase of 6% across the board for all contract services. Utilities • Annual increase of 4%. Transfers Out/Contributions/Other Page 9of10 187 • Preventative Maintenance - $2.0 million per year. • Lease Revenue Bond Early Payoff - $1 million per year to FY 2028-29. • General Fund Contribution to CIP, based on current CIP projects. Next Steps Staff is seeking direction from the City Council on the preliminary budget and any other items it wishes to include in the proposed budget for Fiscal Years 2024-25 and 2025-26. STRATEGIC PLAN INITIATIVE: The Preliminary General Fund budget reflects priorities established in the City's Two -Year Strategic Plan. NOTICING REQUIREMENTS/PUBLIC OUTREACH: The City Council Agenda was posted. ATTACHMENTS: 1) General Fund Summary 2) General Fund Reserves Summary 3) General Fund Transfers Out Summary Page 10 of 10 188 ATTACHMENT 1 GENERAL FUND SUMMARY PRELIMINARY 2024-25 / 2025-26 Actual Adopted Amended 2022-23 2023-24 2023-24 Proposed 2024-25 Revenues Property Tax $59,056,139 $59,896,000 $59,896,000 $63,225,641 Sales Tax 28,902,065 27,000,000 29,995,900 30,536,365 Sales Tax Reimbursements (321,750) (375,000) (375,000) (375,000) Development Revenue 8,588,005 7,109,829 6,903,536 7,731,163 Transient Occupancy Tax 1,533,093 1,500,000 1,500,000 1,550,000 Other Taxes 7,196,591 6,780,500 6,780,500 7,145,000 Licenses & Permits 323,098 286,417 286,417 311,300 Fines & Penalties 80,117 50,000 50,000 67,400 Interest Earnings 5,363,445 2,510,000 5,500,000 5,622,800 Rentals and Leases 2,193,822 1,648,021 1,648,021 2,223,573 Intergovernmental 352,165 290,000 405,000 300,000 Charges for Services 8,648,315 7,389,682 7,389,682 7,373,203 Other Revenue 2,872,013 1,806,412 1,826,412 2,556,358 Subtotal Revenues - Operating $124,787,119 $115,891,861 $121,806,468 $128,267,803 $6,461,335 Transfers In $109,014 $56,600 $129,582 Unrealized Gains/Losses/Adjustments (3,053,407) $ Change from % Change from Amended Amended Mom $3,329,641 5.6% 540,465 1.8% 0 0.0% 827,627 12.0 50,000 3.3 364,500 5.4 24,883 8.7 17,400 34.8% 122,800 2.2% 575,552 34.9% (105,000) -25.9% (16,480) -0.2% 729,946 40.0% Forecast 2025-26 $ 66,148,550 31,403,805 (375,000) 8,719,665 1,600,000 7,402,250 319,900 67,400 5,596,400 2,271,676 300,000 7,573,109 2,663,826 $ Change from % Change from Proposed Proposed $ 2,922,909 4.6% 867,440 2.8 0 0.0% 988,502 12.8% 50,000 3.2% 257,250 3.6 8,600 2.8 0 0.0% (26,400) -0.5% 48,103 2.2% 0 0.0% 199,906 2.7% 107,468 4.2% 5.3% $133,691,580 $5,423,778 4.2% Total Revenues $121,842,727 $115,948,461 $121,936,050 $128,267,803 $6,461,335 5.3% $133,691,580 $5,423,778 4.2% Expenditures Salaries & Wages $12,725,756 $14,150,396 $14,150,396 $15,706,648 $1,556,252 11.0% $16,355,896 $ 649,248 4.1% Benefits 4,781,703 5,386,283 5,386,283 6,235,407 849,124 15.8% 6,483,553 248,146 4.0% Services & Supplies 4,543,179 6,238,992 6,537,061 8,046,129 1,509,068 23.1% 8,280,897 234,768 2.9% Internal Service Fund Charges 4,932,571 5,443,747 5,443,747 5,432,049 (11,698) -0.2% 5,694,733 262,684 4.8% Utilities 2,997,652 3,898,997 3,898,997 3,852,949 (46,048) -1.2% 4,042,135 189,186 4.9% Contracted Services 57,001,245 62,778,423 64,989,616 67,370,579 2,380,963 3.7% 69,775,690 2,405,111 3.6% Capital Outlay 194,558 120,625 542,612 869,000 326,388 60.2% 256,000 (613,000) -70.5% Debt Service Payment 1,333,050 1,331,850 1,331,850 1,334,650 2,800 0.2% 1,331,250 (3,400) -0.3% Contingency & Miscellaneous 14,088 223,910 223,910 224,000 90 0.0% 224,000 - 0.0% Subtotal Expenditures - Operating $88,523,802 $99,573,224 $102,504,472 $109,071,411 6,566,939 6.4% $112,444,154 $3,372,743 Operating Impact (REV-EXP) $36,263,317 $16,318,637 $19,301,996 Transfer Outs & Contributions to Other Funds Transfers Out (CIPs) - Com./Assig 937,641 7,195,281 32,735,111 Transfers Out (CIPs) - Undesignated 1,018,802 10,734,612 17,272,644 Contribution to OPEB/PERS 6 3,460,000 1,000,000 - Contribution to ISF & Other r 2,023,378 2,000,000 2,000,000 Subtotal - Transfers Out & Contribution $7,439,821 $20,929,893 $52,007,755 $6,612,698 $17,551,900 1,695,229 2,917,469 2,000,000 8,450,000 7,101,900 2,000,000 Total Expenditures $95,963,623 $120,503,117 $154,512,227 $115,684,109 $129,996,054 GF Impact (Include CIP & Transfers) $25,879,104 ($4,554,656) ($32,576,177) $12,583,693 $3,695,527 189 ATTACHMENT 2 GENERAL FUND RESERVES SUMMARY RESERVE DESCRIPTION on -Spendable Prepaid Expenses Actual Net Change Projected Net Change Projected 2022-23 2023-24 2023-24 2024-25 2024-25 $4,859 4,859 $0 $4,859 4,859 $4,859 4,859 estricted $4,324,132 $0 $4,324,132 $4,324,132 Cemetery Endowment Developer Contribution - Downtown Developer Contribution - Heritage Park Developer Contribution - Nature Park Section 115 Trust - Pension Heritage Park Maintenance 60,000 1,490,000 19,000 60,000 1,945,132 750,000 60,000 1,490,000 19,000 60,000 1,945,132 750,000 60,000 1,490,000 19,000 60,000 1,945,132 750,000 Committed $76,016,420 ($19,350,347) $56,666,072 $1,000,000 $57,666,072 Advance to Public Facility Fee Downtown Public Improvement Economic Stability Emergency Communications Fire Services Pension/OPEB Innovations and New Opportunity One -Time Initiative - Capital One -Time Initiative - Operating Public Safety Reserve Specific Committed Reserves Contribution to Public Facility Fee Cultural Arts Center (CIP) Don Biddle Park (CIP) Fallon Sports Park III Contingency Lease Revenue Bond Payoff Maintenance Facility (CIP) Utility Undergrounding (CIP) 10,747,169 22,139,587 8,000,000 532,113 2,211,094 894,498 1,918,620 (1,419,112) 503,860 4,600,000 (10,747,169) (389,587) 6,000,000 7,139,197 (6,964,197) 675,193 (675,193) 100,000 (100,000) 7,000,000 1,000,000 55,089 (55,089) 3,500,000 21,750,000 8,000,000 532,113 2,211,094 894,498 499,508 503,860 4,600,000 6,000,000 175,000 8,000,000 3,500,000 21,750,000 8,000,000 532,113 2,211,094 894,498 499,508 503,860 4,600,000 6,000,000 175,000 1,000,000 9,000,000 3,500,000 Assigned $125,043,297 ($28,129,312) $96,913,985 $4,674,071 $101,588,056 Accrued Leave Catastrophic Loss CIP Carryovers Fiscally Responsible Adjustment Municipal Regional Permit Non -Streets CIP Commitments Operating Carryovers Parks and Streets Contingency Pension and OPEB Relocate Parks Department Service Continuity Dublin Blvd Extension Advance Snecific Assigned Reserves ARPA Revenue Replacement Climate Action Plan Contribution to ISF Facade Improvement Grants Library Tenant Improvement Civic Center Improvements (CIP) Pavement Management Public Safety Complex (CIP) Village Parkway Pavement Reconstruction 1,301,506 17,714,064 6,535,032 (6,535,032) 325,000 (325,000) 1,869,152 (645,429) 3,276,777 (464,277) 2,014,571 (2,014,571) 201,270 18,000,000 500,000 3,150,000 42,500,000 (13,000,000) 990,187 2,823,760 (465,673) 1,500,000 (1,500,000) 429,972 1,000,000 (1,000,000) 3,010,829 (1,728,152) 2,000,000 1,022 (1,022) 15,900,156 (450,156) 1,301,506 17,714,064 0 1,223,723 2,812,500 201,270 18,000,000 500,000 3,150,000 29,500,000 990,187 2,358,087 429,972 1,282,677 2,000,000 15,450,000 1,301,506 17,714,064 0 (420,000) 803,723 2,812,500 201,270 18,000,000 500,000 3,150,000 6,400,000 35,900,000 990,187 (100,929) 2,257,158 429,972 (205,000) 1,077,677 2,000,000 (1,000,000) 14,450,000 Unassigned $44,347,900 $4,156,313 $48,504,213 $6,909,622 $55,413,836 Unassigned -Unrealized Gains Unassigned (Available) TOTAL RESERVES (14,061,701) 58,409,602 (14,061,701) 62,565,915 (14,061,701) 69,475,537 $249,736,608 ($43,323,346) $206,413,262 $12,583,693 $218,996,955 190 ATTACHMENT 3 GENERAL FUND TRANSFERS OUT SUMMARY PRELIMINARY 2024-25/2025-26 BUDGET (NEW) PROJECTS/ ITEMS NOTED Project Description PROPOSED FORECAST 2024-25 2025-26 CIP PROJECTS FUNDED BY RESERVES Village Parkway Reconstruction $ 1,000,000 $ 8,450,000 Civic Center Rehabilitation 205,000 Electric Vehicle (EV) Charging Stations 70,229 Green Stormwater Improvements 420,000 Subtotal - Funded by Reserves $ 1,695,229 $ 8,450,000 Undesignated Sunday School Barn $ 125,000 $ 260,000 Kolb Park Renovation 2,450,000 Downtown Dublin Square 4,680 Citywide Storm Drain Improvements 30,000 Citywide Bicycle and Ped Improvements 105,000 Marquee Signs 350,000 Citywide Energy Improvements 600,000 400,000 Downtown Dublin Street Grid Network 8,990 Facilities Parking Lot Resurfacing (NEW) 500,000 500,000 Wave Water Feature Assessment (NEW) 50,000 Waste Enclosures (NEW) 131,124 Resiliency & Disaster Preparedness Improvements (NEW) 277,000 1,375,000 Annual Steet Resurfacing/Pavement Management (NEW) 765,675 2,086,900 Subtotal - Undesignated $ 2,917,469 $ 7,101,900 Subtotal Transfers Out to CIPs $ 4,612,698 $ 15,551,900 Other Contributions/Transfers Out Transfer Out to ISF/Other 2,000,000 2,000,000 Subtotal - Other Contributions/Transfer Out to Other $ 2,000,000 $ 2,000,000 Total - General Fund Transfers Out $ 6,612,698 $ 17,551,900 191 Preliminary General Fund FY 2024-25/ 2025-26 Budget April I 6, 2024 DUBLIN CALIFORNIA 192 Presentation Overview BIENNIAL BUDGET FOCUS ON GENERAL FUND PROCESS OPERATING BUDGET 10-YEAR FORECAST RECOMMENDATIONS Revenues Expenditures General Fund Summary Proposed 024-2 $128,267,803 ($109,071,411) Forecast -26 $133,691,580 ($112,444,154) Operating Surplus $19, 196, 391 $21,247,427 Contributions to ISF Transfers Out ($2,000,000) ($4,612,698) ($2,000,000) ($15,551,900) General Fund Impact $12,583,693 $3,695,527 GF Revenues Total General Fund Revenue o FY 2024-25 +$6.46M (5.3%) o FY 2025-26 +$5.42M (4.2%) Property Tax +$3.32M (5.6%) / +$2.92M (4.6%) o 2.0% CPI adjustment o New construction & change in ownership o I % delinquency rate GF Revenue Sales Tax +$540K (I.8%)I +$867K (2.8%) o FY 2024-25 -Slight decrease in Auto/Transportation o FY 2025-26 -Increases in all sectors, led by Auto/Transportation Development Revenue +$827K (12.0%) / +$988K (12.8%) o Timing of development projects o Revenues and expenditures timing not aligned o Service Continuity Reserve - $3.15M GF Revenues Charges for Services -$ 1 6K (0.2%) / +$ 1 99K (2.7%) o Projected decrease in Santa Rita reimbursement revenue o Operational change that occurred in current year (FY2023-24) o Projected increase from Parks and Community Services (PCS) Programs o FY 2025-26 - continued increases in PCS programs OtherTaxes +$364K (5.4%) / +$257K (3.6%) o Annual Adjustments to Franchise Fees — (garbage, gas, electric) GF Revenues Interest +$ 1 22K (2.2%) /-$26,400 (0.5%) o Revenue earned on investments projected to be flat o Monitoring o Interest Rates o Cash Balance o Accounting change GF Revenue Rents & Leases +$575K (+34.9%) / +$48K (+2.2%) o Strong demand for City rental spaces o Dublin Arts Center opening Other Revenue +$729K (+40.O%) / +$ 1 07K (+4.2%) o Accounting practice change — Fire Retiree Health o Camp Parks Intergovernmental Support Agreement (IGSA) GF Expenditures Total General Fund Expenditures o FY 2024-25 +$6.56M (6.4%) o FY 2025-26 +$3.37M (3.1 %) Salaries &Wages +$ I.55M (11.0%) / $649K (4.I%) o New Position - Associate Civil Engineer - CIP o Added in current year - Code Enforcement Officer and Management Fellow o Shift position (IT Fund to General Fund) o Increase in Seasonal Staffing Cost R DUBLIN CALIFORNIA 200 GF Expenditures Benefits +$849K (15.8%) / +$248K (4.0%) o CaIPERS o Health premium increases o Shift to PEPRA workforce Services & Supplies +$ I.5 I M (+23.1 %) / $234K (+2.9%) o Increase in insurance premiums o Increase in PublicWorks Repairs/Maintenance budget GF Expenditures Contract Services +$2.38M (+3.7%) / +$2.40M (3.6%) o Police Services + I . I I M (4.4%)/ +$932K (3.5%) o I Additional Deputy o Full Year Crime Tech o Dispatch call volume increases o Fire Services +$ I.65M (9.I%) /+$II9M (6.5%) o Annual COLA and Benefit increases o County overhead o Accounting change GF Expenditures o MCE +85 I K (1 0.7%) / +$406K (4.6%) o 4 Additional FTE's — Lead Foreman o Increased pay rates o Additional facilities and expanded hours o Other Contracts o Library Services — 5.5% Placeholder o City Attorney - Flat o Animal Services - Flat GF Expenditures Capital Outlay +$326K (60.2%) / -$6 1 3K (70.5%) o Onetime expenditures o Drone as first responder o Alerting system at Dublin Fire Stations o New code enforcement vehicle o Equipment for PCS CALIFORNIA Transfers Out - CIP Project Description PROPOSED FORECAST 2024-25 2025-26 CIP PROJECTS FUNDED BY RESERVES Village Parkway Reconstruction Civic Center Rehabilitation Electric Vehicle (EV) Charging Stations Green Stormwater Improvements $ 1,000,000 $ 8,450,000 205,000 70,229 420,000 Subtotal - Funded by Reserves $ 1,695,229 $ 8,450,000 Undesignated Sunday School Barn Kolb Park Renovation Downtown Dublin Square Citywide Storm Drain Improvements Citywide Bicycle and Ped Improvements Marquee Signs Citywide Energy Improvements Downtown Dublin Street Grid Network Facilities Parking Lot Resurfacing (NEW) Wave Water Feature Assessment (NEW) Waste Enclosures (NEW) Resiliency & Disaster Preparedness Improve (NEW) Annual Steet Resurface/Pavement Mangmt (NEW) Subtotal - Undesignated Subtotal Transfers Out to CIPs $ 125,000 4,680 105,000 350,000 600,000 8,990 500,000 50,000 131,124 277,000 765,675 $ 2,917,469 $ 4,612,698 $ 260,000 2,450,000 30,000 400,000 500,000 1,375,000 2,086,900 $ 7,101,900 $ 15,551,900 205 Transfers Out/Contribution o Preventative Maintenance - $2.0 million per year o No contribution to retirement/OPEB Reserve Category Restricted Committed Assigned Unassigned (Cashflow) Unrealized Gains/(Losses) Total GF Reserves FY 2023-24 FY 2024-25 FY 2025-26 $4.3 $56.7 $4.3 $57.7 $4.3 $58.7 $96.9 $101.6 $93.6 $62.5 ($14.0) $69.5 $80.2 ($14.0) ($14.0) 1 $206.4 Million $218.9 Million $222.6 Million IO-Year Forecast 24-25 CALIFORNIA 25-26 Property Taxes Interest 26-27 27-28 28-29 Sales Tax Rentals & Leases mom Intergovernmental Charges for Svcs Other 200,00D 18D,000 160,000 140,006 120,00a 100,0W 80,000 60, 000 40, OOo 20,000 0 31-32 32-33 Development 29-30 30-31 — Other Taxes 33-34 Licenses & Permits Fines Total Expenditures Forecast Assumptions Expenditures o Personnel — No new positions — COLA: Up to 3.5% annually — Benefits:5% annually o Services and Supplies: 2% annually o Internal Service Funds: 10% annually o Contract Services: 6% annually o Utilities:4% annually Forecast Assumptions Revenue o Property Tax — Based on HDL (Years 3 - 5 = 3.75 — 5.25%) — Years5- IO2.5% o Sales Tax — 2.5% annually — Reduction of $2.5 in FY 2026-27 o Development: decrease years 4 - I 0 o Interest: decrease years 3 - I 0 o Other: up to 3% annually Recession o Loss of Revenue o Timing - Sales Tax - Property Tax Revenue FY 23-24 Amended ude Revenu $29,995,900 15.0% $4,499,385 $59,896,000 4.4% $2,635,424 $89,891,900 $7,134,809 Next Steps o Budget Adoption by I st meeting in June o Other items or additional information to include in the FY 2024-25/ FY 2025-26 Budget?