Finance Highlights 2012 0302 - Laserfiche WebLink

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CITY OF SAN LEANDRO MEMORANDUM DATE: March 2, 2012 TO: Chris Zapata, City Manager FROM: James O'Leary, Interim Finance Director BY: Mary Ann Perini, Budget and Compliance Manager SUBJECT: Discussion Regarding Annual Report on the Emergency Communication System Access (911) Tax and Annual Tax Cap Adjustment RECOMMENDATION Staff recommends the Finance Committee approve the Annual Report of the Emergency Communication System Access (911) Tax for 2011 -12, as required by Municipal Code Section 2 -18 -220. Staff also recommends reviewing the proposed rates, including the Consumer Price Index (CPI) adjustment for the Emergency Communication System Access (911) Tax and the tax cap threshold for 2012 -13 to be acted on in May 2012. BACKGROUND AND ANALYSIS The Emergency Communication System Access (911) Tax was approved by San Leandro voters on November 4, 2008 and adopted by the City Council on December 15, 2008. The 911 tax provides funding for the Emergency Communication System. Currently, the 911 tax is projected to generate $2.7 million for the fiscal year ending June 30, 2012 and provides adequate funding for a reliable 911 communication system. Eligible Operating Costs Revenues raised by the 911 Tax may not exceed "eligible" operating costs and projected costs. Eligible operating costs are the portion of City operating expenses attributed to the operation of the 911 emergency communication system to telephone subscribers who are required to pay the tax imposed. In addition, eligible project costs are the portion of project costs attributable to a project associated with the 911 communication system. Exempt operating and project costs are the portions of expenses for availing 911 services to subscribers that have exempt status, such as the Lifeline Subscribers. Eligible operating costs shall not include exempt operating costs. As a result, a cost recovery ratio is determined when developing the eligible operating and project costs. Based on information from July 2011 through December 2011, the estimated total phone lines in the City are 117,099. Of the total phone lines, it is estimated that 107,037, or 91 %, are considered eligible for the 911 Tax. Attachmentl shows a breakdown of the line count by phone line type and the 911 current tax rate /cap and proposed tax rate /cap.