Finance Highlights 2008 0219 - Laserfiche WebLink

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CITY COUNCIL FINANCE COMMITTEE February 19, 2008 4:00 p.m. - 5:30 p.m. San Leandro City Hall 835 East 14t~ Street San Leandro, California (Sister Cities Gallery) HIGHLIGHTS Committee Members: Mayor Santos, Vice Mayor Grant (Chair), Councilmember Gregory City Staff Present: City Manager Jermanis, Assistant City Manager Hollister, Interim Finance Director Carter, Deputy Finance Director Rodriguez, Budget & Compliance Manager Perini, Police Chief Attarian, Police Captain Willis, Fire Chief Gilbert, Deputy Chief Rocha, Financial Services Manager Hisatomi, Accountant II Galvin, Administrative Assistant III Perez Public Present: Martin Ricard, Daily Review, and Charles Gilcrest The meeting was called to order at 4:05 p.m. 1. Discussion Regarding FY 2007-08 Mid-Year Performance Report Interim Finance Director Carter requested that the Committee review page 2 of the Mid-Year Performance Report and Carter provided an explanation of the General Overview and Economic Outlook of the General Fund. Due to the decline of Sales, Utility User, and Real Property Transfer Tax, it is estimated that there will be a revenue shortfall of $4.1 million. Sales Tax revenue is estimated at $22.6 millions, $2.1 million down from the original estimate of $24.7; Real Property Transfer Tax revenue is estimated at $3.5 million, a shortfall of $1.5 million; and Utility User Tax has dropped $500,000 from the original estimate of $10.6 million. Carter stated that there will be a salary savings of approximately $600k, which is not enough to solve the shortfall problem. All other categories of revenue are as expected. Mayor Santos complemented the Council, including Vice Mayor Grant and Councilmember Gregory, for holding onto and increasing the amount in reserves as this will help the City with upcoming economic uncertainties at both local and national level. Councilmember Gregory questioned whether the State has indicated if money will be taken away from the City. City Manager Jermanis stated that the State may borrow money from the City but will have to pay it back. Jermanis also stated that the Council did a great job in reserving for economic uncertainties. Carter also provided a summary of General Fund reserve balances and the impact that the revenue short fall would have on the reserves. Within a 2-year period, reserves could go from $24 million to $11 million. For the fiscal year 2008-09 budget, Jermanis recommended that departments prepare their respective budgets with the objective of current operating expenses not 1