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TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: FINANCE DIRECTOR
DATE: SEPTEMBER 3, 2002
SUBJECT: FY 2001-2002 BUDGET ADJUSTMENTS
Staff Coordinator: Kathryn Downs, Accounting Manager
Adopt Resolution No. 2002- , amending Resolution 2001-43, the budget appropriation for FY 2001-2002, to increase budgeted appropriations in the General fund, Gas Tax fund and Equipment Replacement fund.
Chapter 3.32 of Title 3 of the Rancho Palos Verdes Municipal Code sets forth guidelines related to the City’s budget administration. Section 3.32.070 of the Code requires that all expenditures in excess of a program/function’s budgeted allocation must be approved by supplemental appropriation by the City Council. While compiling the FY 2001-2002 expenditures for the City, it was determined that six programs within the General fund, Gas Tax fund and Equipment Replacement fund exceeded the amount budgeted. Therefore, a supplemental appropriation in each of these programs will be necessary to satisfy budgetary compliance. A discussion of the requested adjustments to the programs follows.
City Manager Program – League of California Cities Membership Dues
The FY 2001-2002 budget included $11,590 for the City’s membership dues for the League of California Cities. Actual League dues paid during FY 2001-2002 were $14,596, which included the City’s contribution to the League’s Grassroots Network Plan. Staff requests a budget adjustment for $3,000 to adequately appropriate the membership dues.
Emergency Preparedness Program – Salary Allocation
During the preparation of the FY 2001-2002 budget document, allocation of the Assistant City Manager’s salary to the Emergency Preparedness program was inadvertently excluded. Therefore, the salary allocation was not included in the City Council approved appropriations. Staff requests a budget adjustment in the amount of $9,820 to accommodate the allocation of a portion of the Assistant City Manager’s salary.
View Restoration Program – View Restoration Professional Services
The FY 2001-2002 budget included an appropriation of $220,000 for professional support of the View Restoration Program. Actual costs of $278,362 exceeded the budget due to additional coordination of view restoration cases by the City’s independent contractor. Staff requests a budget adjustment in the amount of $59,000 to accommodate the additional FY 2001-2002 expenditures.
Recreation Administration Program – Temporary Staffing
The budgeted Administrative Analyst II position in the Recreation and Parks Department has been open for twenty-six months due to a medical absence. Staff requests an additional $11,000 appropriation for costs expended during FY 2001-2002 to fill this position with temporary help.
Gas Tax Fund
Traffic Signal Maintenance Program – Street Light Electricity and Maintenance
The City experienced a 56% increase in the cost of electricity during FY 2001-2002 ($0.11712 vs. $0.07487 per kWh). The FY 2001-2002 appropriation for traffic signal light and power was $20,000. An additional $11,000 appropriation is requested to accommodate the increased electricity costs.
Equipment Replacement Fund
Other Financing Uses – Loss on Disposal of Fixed Assets
On June 18, 2002 Staff recommended and the City Council adopted a new fixed asset capitalization threshold of $5,000, effective for FY 2001-2002. Staff adjusted the General Ledger to write-off all fixed assets with original costs of less than $5,000. Approximately one-third of these items were not fully depreciated. Generally Accepted Accounting Principals (GAAP) requires the City to record a loss for the amount of depreciation not previously recorded. This loss is merely an accounting shift of depreciation from future periods to the current period. Staff requests an additional FY 2001-2002 appropriation of $191,000 for this accounting adjustment.
Staff anticipates that the excess of revenues over budget and additional expenditure savings for FY 2001-2002 will offset these additional budget requests. Finance Staff has taken the initiative to ensure that these additional budget requests are not for projects with continuing appropriations.
RESOLUTION NO. 2002 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES, AMENDING RESOLUTION 2001-43, THE BUDGET APPROPRIATION FOR FISCAL YEAR 2001-2002, TO INCREASE THE BUDGET FOR THE APPROVED YEAR END BUDGET ADJUSTMENTS
WHEREAS, Section 3.32 of the Rancho Palos Verdes Municipal Code provides that all expenditures in excess of budgeted allocations must be by supplemental appropriation of the City Council: and
WHEREAS, on June 5, 2001, the City Council of the City of Rancho Palos Verdes adopted Resolution 2001-43, approving a spending plan and authorizing a budget appropriation for the 2001-2002 fiscal year: and
WHEREAS, certain programs included in the fiscal year 2001-2002 budget will have expenditures in excess of the adjusted budget; and
WHEREAS, the City Council desires that the fiscal year 2001-2002 budget be increased for each of these programs to assure budgetary compliance.
BE IT, THEREFORE, RESOLVED BY THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES:
The following adjustments be made to the fiscal year 2001-2002 budget:
Increase the General Fund budget as follows:
City Manager #001-102-72 Memberships & Dues $ 3,000
Increase the Gas Tax Fund budget as follows:
Traffic Signal Maint #102-304-20 Light & Power $ 11,000
Increase the Equipment Replacement Fund budget as follows:
Other Financing Use#781-395-20 Loss on Asset Disposal $ 191,000
PASSED, APPROVED, AND ADOPTED THE 3RD DAY OF SEPTEMBER 2002.
State of California )
I, JO PURCELL, City Clerk of The City of Rancho Palos Verdes, hereby certify that the above Resolution No. 2002- was duly and regularly passed and adopted by the said City Council at regular meeting thereof held on September 3, 2002.