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911 Revenue Program - 2 - April 26, 2006 Cost Recoverv: In FY 05-06, the City is recovering 89.6% of the total eligible operating cost. The monthly 911 Fee revenue through February 2006 is $1,333,989, which represents 61.3% of the projected revenue of $2,175,000 for FY 2005-06 and appears to be slightly lower than expected. (Staffis anticipating that the audit services described below can cover the remaining shortfall, limiting any additional fee increase beyond the CPI). In FY 2006-07, the projected $2.41 million in revenue will recover approximately 90%, of the eligible operating cost. To recover the maximum allowable amount, the City is proposing to increase the 911 fees by the CPI rate of 2.9%. This increase will result in a $2.06 single access line fee from $2.00, a $14.41 trunk line fee from $14.00, and a $50.44 super trunk line fee from $49.00. The following table compares the current 2005-06 revised budget and the proposed 2006-07 budget. The proposed revenue for 2006-07 includes the CPI rate increase of 2.9%. Effective July 1, 2006, the new rate is projected to lessen the gap between 911 fee revenues and expenditures eligible for cost recovery. FY 2005-06 FY 2006-07 Budget Proposed Budget Projected Carryover (88,828) Revenue Rec'd/Projected $ 2,175,000 $ 2,412,045 Expenditures: Police Salary & Benefits 1,635,495 1,687,916 Police Services 31,092 37,092 Police Supplies 7,800 7,800 Police Capital 212,000 217,757 Police Overhead 426,942 389,858 Fire Dispatch 213,265 318,102 Total Expenditure $ 2,526,594 $ 2,658,525 Eligible Recovery Ratio 89.6% 90.0% Eligible Operating Cost $ 2,263,828 $ 2,392,673 Net of Cost Recovery (88,828) (69,456) 911 Fee Audit Services: In the near future, Staffwill implement an audit services program for the City's 911 fee revenues. The proposed program will be one of two options: 1) an amendment to the City's current agreement for UUT audit services with MBIA Muniservices Company (MMC), to include audit services ofthe City's 911 fee or 2) an in-house program that will be developed by City Staff. G:\Council\2005-06 Resolutions & Staff Reports\9 I I fee-0506.DOC