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Home My WebLink About8.1 AppropLmtRevFY94-95 . . CITY OF DUBLIN AGENDA STATEMENT CITY COUNCIL MEETING DATE: June 28,1995 SUBJECT: Adoption of an Appropriations Limit for 1995/96, including a Revision to Fiscal Year 1994/95 Base. (prepared by: Paul S. Rankin, Assistant City Manager/Administrative Services Director) EXHIBIT ATTACHED: 1. I Proposed Resolution r!:l~ J Approve the seleeted factors used to calculate the Revised 1994/95 ~ L/ Limit and the 1995/96 Limit and adopt the Resolution. RECOMMENDATION: FINANCIAL STATEMENT: The Revised 1994/95 Limit will be $22,338,721. The 1995/96 Limit is $23,690,214 and only $12,375,629 in 1995/96 Appropriations are subject to this Limit. DESCRIPTION: Each year the City Council must adopt an Appropriations Limit in conjunction with the annual Budget process. The City Council adopted a 1994/95 Limit on June 21, 1994. The Alameda County Assessor has now provided updated information which would substantiate a revision to the 1994/95 Adopted Limit. Resolution No. 53-94 recognized the potential need to consider a revision. The 1995/96 Appropriations Limit is calculated by multiplying the "revised" limit calculated for the prior year by a factor reflecting growth increases. Description of Appropriations Limit The laws regulating the application of the Appropriations Limit forbid the appropriation of specific funds which would exceed the Limit. The Appropriations Limit carries forward each year and is subject to an adjustment in accordance with a specified formula. Each government entity is required to calculate an Appropriations Limit and include it as part of the Annual Budget. This Limit may also be referred to as the Gann Limit or Proposition 4 Limit. The adjustment made annually is based on a formula which may include the following factors: change in City population, change in population for the entire County, change in State per capita income, and change in non-residential assessed valuation. As will be noted in the actual calculations, selection of some of the factors are discretionary. Typically, an agency selects from those factors which provide for the largest growth in the Limit. The Appropriations Limit does not apply to all funds appropriated by the City Council. The law only applies to those appropriations that are funded by "Proceeds of Taxes." Proceeds of Taxes are narrowly dermed by State Law. Historically, the applicable appropriations made by the City of Dublin have always been well below the Limit. In Fiscal Year 1995-96, the appropriations subject to this Limit total $12,375,629. Although the City is well below its allowed Limit, it is important to make revisions in a timely manner. For record keeping purposes, the Limit carries forward each Fiscal Year, and having an accurate base simplifies the calculation for the following Fiscal Year. The City must also adopt a Limit prior to the beginning of the Fiscal Year, in accordance with State Law. Revision to 1994/95 Limit When the original 1994/95 Limit was adopted, the City had incomplete information on the change in non- residential building valuation. The formula allows for the selection between (1) the change in State per Capita Income or (2) Non-Residential Building Valuation. Although the change in State Per Capita Income was less than 1 percent (0.71 %), this was the only factor which was available when Resolution 54- 94 was prepared. ---------------------------------------------------------------------- ITEM NO. .8....1. COPIES TO: Cory Biggs, Maze & Assoc. CITY CL'ERK FILE~ . . The Alameda County Assessor has now provided updated information on the change in non-residential assessed valuation for the City of Dublin. The total change in Fiscal Year 1994/95 was an additional $4,475,900 added to the secured tax roll. This results in a percentage change of 7.873%, which is beneficial in increasing the City's Appropriations Limit. The following table demonstrates the impact of the change: 1994/95 As Originally Adopted $20,855,341 Proposed Revised Limit $22,338,721 Difference + 1,483,380 The significant change is representative of using a factor of 7.873% instead of 0.71 %. Exhibit A of the Proposed Resolution (Exhibit 1) details the changes made to the 1994/95 adopted base. 1995/96 Limit Staff has prepared the calculations necessary to adopt the Appropriations Limit for 1995/96 in accordance with State Law. This information was also included on pages xix and xx of the Preliminary 1995/96 Budget. The factors used in calculating the 1995/96 Limit are: (1) the change in the County Population and (2) the change in State per capita income. Based upon limited data available from the County Assessor, it is not beneficial to use the change in assessed value. If in the future complete Assessor data would warrant the use of this data, Staff will present for City Council consideration a Resolution revising the base figure. The new 1995/96 Limit as calculated on Exhibit B of the Proposed Resolution (Exhibit 1) is $23,690,214. The Preliminary 1995/96 Budget (including the recommended Higher Service Levels) includes appropriations of $12,375,629 which would be categorized as Proceeds of Taxes. Therefore, the appropriations subject to the Appropriations Limit are $11,314,585 ~ the allowed amount as calculated for 1995/96. ..,..-- Proposed Resolution Staff has prepared a Resolution (Exhibit 1) which will adopt a revised 1994/95 Appropriations Limit and adopt a Limit for 1995/96. This action to revise the prior year Limit will not change the appropriations made by the City Council in adopting a 1994/95 budget. The change provides for the use of the most accurate information in preparing the 1995/96 Appropriations Limit adjustment. Staff recommends that the City Council adopt the Resolution. PSR/lss a:Approp94.agenda#15 . RESOLUTION NO. - 95 . A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN ADOPTING AN APPROPRIATIONS LIMIT FOR FISCAL YEAR 1995/96 INCLUDING AN ADJUSTMENT TO THE 1994/95 ADOPTED BASE WHEREAS, State Law requires that the Appropriations Limit be adopted and presented with the Annual Budget; and WHEREAS, The Alameda County Assessor could not provide accurate information regarding the change in non-residential assessed valuation at the time the 1994/95 City Budget was presented; and WHEREAS, The City Council previously adopted Resolution 53-94, which anticipated a potential Appropriations Limit revision in the event non-residential valuation escalated at a higher rate than the change in per capita income; and WHEREAS, The Assessors 1994/95 records have now been updated to provide complete information on non-residential assessed valuation; and WHEREAS, the law allows the City the option to select from specified factors those to be used in the calculation; and WHEREAS, The City Council previously adopted a 1994-95 Appropriations Limit in Resolution 53-94 using (1) the Growth in the City Population and (2) the change in the State per capita income; and WHEREAS, the revised 1994-95 Appropriations Limit is calculated by selecting (1) the Growth in the City Population and (2) the change in non-residential assessed valuation; and WHEREAS, the revised calculation of the 1994/95 Revised Appropriation Limit is described in Exhibit A, attached hereto and by reference made a part hereof; and WHEREAS, the proposed 1995/96 Limit is calculated based upon an adjustment to the 1994/95 Revised Appropriations Limit; and WHEREAS, the factors selected for calculation of the 1995/96 Appropriations are (1) Growth in the County Population and (2) change in the State per capita income; and WHEREAS, the calculation of the 1995/96 Appropriations Limit is described in Exhibit B, attached hereto and by reference made a part hereof. NOW, THEREFORE, BE IT RESOLVED THAT THE City Council of the City of Dublin does hereby adopt an adjustment to the 1994/95 Appropriations Limit and a Limit for 1995/96 as shown in Exhibits A and B. PASSED, APPROVED AND ADOPTED this 28th day of June, 1995. AYES: NOES: ABSENT: Mayor ATTEST: City Clerk g: \agenda\resos\safety .doc . . REVISED CALCULATION OF FISCAL YEAR 1994-95 (Presented at a Public Hearing 6/28/95) A. SELECTION OF OPTIONAL FACTORS I. Population - City vs. County % Decrease .1LlL2.3. .lLlm. % Increase City of Dublin 24,658 24,947 1.17% QR Alameda County 1,321,342 1,334,127 .97% Selected Factor = City Population Growth 1.17% II. State Income vs. City Non-Residential Buildin~ Change in State Per Capita Income = 0.71% QR Change in Non-Residential Assesed Valuation = 7.873% (Complete informatiaB Bot available tram :\lameda Caooty) Selected Factor State Per Capita Income 9.71% Change in Non-Residential Assessed Valuation = 7.873% B. CALCULATION OF GROWTH LIMIT ADJUSTMENT The formula for calculating the adjustment is as follows: Selected Factor I + 100 100 x Selected Factor II + 100 100 Y (X) x (Y) = Fiscal Year 1994-95 Appropriations Limit Adjustment Factor 1.1 7 + 100 100 1.01170 7.783 Qrl.l. + 100 100 1.07873 1.9971 () 1.91179 x 1.971Q I.Q1888 Pissal Year 1994 951'.djlistmeat Pastor 1.01170 x 1.07873 = 1.09135 = Revised 1994/95 Adjustment Factor C. CALCULATION OF APPROPRIATIONS LIMIT Fiscal Year 1993-94 Adjusted Appropriations Limit = $ 20,468,888 Fiscal Year 1994-95 Revised Adjustment Factor x 1.09135 Revised Fiscal Year 1994-95 Limit $ 22,338,721 a:PSR/lss a:AppExA95.agenda#15 EXHIBIT A . . CALCULATION OF FISCAL YEAR 1995-96 APPROPRIATIONS LIMIT A. SELECTION OF OPTIONAL FACTORS #1. Population - City vs. County 1/1/94 1/1/95 % Increase City of Dublin 24,924 25,145 .89% QR Alameda County 1,332,779 1,349,763 1.27% :::::::::::::::::::::::::::::::::::::::::::::::::::::'::::::::::::::::::::::::I::::::::::::::::::::::I:::::~!!i.g:::fi!9~gr::lj::::ffi:::gggil:::BBPY!!tign::glll:::ji:!:11i1::::::::::::::::::::::::::::::::::::::::::::::::::::':::::::::::::::::::::::::::::::::::::::::::'::::::::::::::::::::: #2. State Income vs. City Non-Residential Building Change in State Per Capita Income = 4.72% QR Change in Non-Residential Assessed Valuation = 3.30%* (Complete information not available from Alameda County Assessor. The calculation was based on Assessed Value information as of April 12, 1995) .:::::::::::::::::::::::::::::::::::::::::::::::::::1::::::::::::::::::::::::::::::::::::::::::::::::::::::::::~!J.!pl~:::E!lgr::I:::g::ffl::~il:::f.lr::I!p'g:mgpgmi!:i:::Ef4.~lgl::::!:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::!::::::::::::::::::::::::::::::::::::::::::::::::::: B. CALCULATION OF GROWTH LIMIT ADJUSTMENT The formula for calculating the adjustment is as follows: Selected Factor #1 + 100 100 = x Selected Factor #2 + 100 100 = Y (X) x (Y) = Fiscal Year 1995-96 Appropriations Limit Adjustment Factor 1.27 + 100 100 = 1.0127 4.72+ 100 100 ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::a:~ql:;i:::i:::llqliJ.:::ffl:::I:~qip1::ffl:::E!!S!I:::ler:::I:IJ~t~::IIJY.igint:::Ei.~ltl::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::!:::: = 1.0472 C. CALCULATION OF APPROPRIATIONS LIMIT Fiscal Year 1994-95 Adjusted Appropriations Limit = $ 22,338,721 Fiscal Year 1994-95 Revised Adjustment Factor x 1.0605 ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::liil!!:I:::i~i~~Ur;i!r::I::I!itl~:::~!IIf.:::::::::::::::::::::::::::::::::!:::::::::::::::::::I:::gl~I!I~II!:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::!::!::::::'::::::::::::::::::~:'::::I::::::: EXHIBIT B