Finance Highlights 2009 0908 - Laserfiche WebLink

Home

2. Discussion Regarding Budget and Fund Balance Impact of Loan Repayments Carter provided a brief explanation of repayment of loans or advances due to the General Fund. He explained that while repayments do represent cash payments to the General Fund, they are not revenue and do not increase total fund balance. In June 2009, the City received a payment of $1.5 million which represented the repayment of a loan from the sale of trash garbage trucks and equipment. The payoff was not expected and represents an unanticipated inflow of funds to the General Fund. Thus, the Reserved portion of fund balance was decreased by the $1.5 million and consequently, the Unreserved, or Council Designated portion of the fund balance was increased by $LS million. Mayor Santos inquired about the outstanding loan to the Shoreline. Also, Mayor Santos requested staff to report on the status of all outstanding loans. Carter stated that staff will provide an analysis. 3. Discussion Regarding Five-Year Budget Forecast City Manager Hollister informed the Committee that staff has developed a model that would provide different scenarios with interactive variables that would assist in developing afive-year budget forecast. Carter explained that the model was designed to identify future events and assist Council and staff in planning for future budgets. Carter changed the scenarios from optimistic to pessimistic, as well as status quo, and was able to show how each would affect the City's future. Carter stated that staff is being very cautious in forecasting revenues (Sales, Property, UUT, and Real Property Transfer Taxes). The Revenue Measures that are currently being discussed were not mentioned but can be a part of the forecast. Also, the Golden Handshake was not taken into consideration until staff knows exactly how many employees will be accepting the offer; employees have until October 31, 2009. Carter explained to the Committee that the model was designed to provide assistance but not meant for the Committee or Council to make decisions today. 4. Update on the FY 2009-10 and FY 2010-2011 State Supplemental Educational Revenue Augmentation Fund (ERAF) Take from the Redevelopment Agency Business Development Manager Battenberg advised the Committee that the State plans to take $5.1 million from the Redevelopment Agency of San Leandro (RDA). The first payment to the State is due in May 2010. The California Redevelopment Agency is putting together a lawsuit, similar to the lawsuit of 2008, to prevent the State from taking money from the various Redevelopment Agencies. The RDA has submitted paperwork to be included as a plaintiff in that lawsuit. Battenberg stated that currently, the RDA does not have the ability to pay in all redevelopment areas. The West San Leandro Area does have the funds and is able to payment $1.1 million that is being sought; the Plaza Project Area also has the funds available; however due to the purchase of the old Albertson lot as well as assisting the San Leandro Unified School District, the Joint Project Area has a shortfall of $2 million. Battenberg suggested a loan from the City for the $2 million may be needed. Community Development Director Sims explained that problem is much bigger than the $2 million shortfall. Sims explained that the State did not raise the cap and therefore once the money has been taken; there is no chance in getting it back. Councilmember Prola suggested writing to our State Representatives in raising the caps. 2