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CITY OF SAN LEANDRO <br />MEMORANDUM <br />DATE: July 14, 2006 <br />TO: Finance Committee <br />VIA: John Jermanis, City Manager <br />FROM: Jesse Baloca, Finance Directo <br />SUBJECT: Discussion on FY 2006-07 Reserves and the Restoration of Positions and <br />Community Activities <br />During the adoption of the FY 2006-07, Council directed Finance Committee to review and <br />continue discussion on the City's reserves and to develop a recommendation that considers the <br />restoration of some City services and programs. Specifically, Finance Committee is tasked with <br />reviewing the restoration of the Cherry Festival in 2007, restoring Sunday Library services, <br />adding back a School Resource Officer position, and providing additional funding for <br />community-based organizations. <br />Staff recommends that the discussion and Finance Committee's proposal take into consideration <br />some of the City's long-term debt obligations (retiree medical) and other unmet needs (capital <br />funding and replacement reserves). Staff also recommends that the proposal continue the <br />practice of maintaining fiscal prudence by not expanding permanent programs with one-time <br />revenue windfalls. <br />FY 2006-07 Reserves <br />In the new budget, the City continues to anticipate an operating shortfall of $570k. The shortfall, <br />which is believed to be structural, is balanced with loan repayments originally designated for <br />replenishing the City's Economic Uncertainty Reserves. <br />The FY 2006-07 General Fund Budget was adopted as follows: <br />July 1, 2006, Available Reserves <br />Operations: <br />Revenues <br />Expenditures <br />Loan Repayments: <br />Used to Balance Operations <br />Used to Replenish Economic Uncertainty <br />$570 <br />423 <br />Net Non Operating Sources $993 <br />$ 12,909 <br />$73,591 <br />(74,161) <br />Net of Operations ($570) <br />June 30, 2007, Available Reserves $13,332 <br />