Laserfiche WebLink
City of San Leandro <br />Meeting Date: June 2, 2014 <br />Staff Report <br />Agenda Section:File Number:14-160 CONSENT CALENDAR <br />Agenda Number:8.D. <br />TO:City Council <br />FROM:Chris Zapata <br />City Manager <br />BY:David Baum <br />Finance Director <br />FINANCE REVIEW:David Baum <br />Finance Director <br />TITLE:Staff Report for Resolution Establishing the City’s Appropriation Limit for <br />Fiscal Year 2014-15 <br />SUMMARY AND RECOMMENDATIONS <br />Staff recommends City Council approval of a resolution establishing the City’s appropriation <br />limit for fiscal year 2014-15 . Staff has completed the calculations required for determining the <br />City’s appropriation limit for 2014-15, which is $175,666,900. Budget appropriations that are <br />subject to the 2014-15 limitation total $80,897,562 which is $94,769,338 below the limit. <br />BACKGROUND <br />On November 6, 1979, California voters passed Proposition 4. Statutes clarifying certain <br />provisions of the proposition are now codified in Article XIIIB of the California Constitution . <br />This Article is commonly known as the “Gann Initiative .” The Initiative established <br />constitutional spending limits allowable for California governmental agencies based on the <br />Consumer Price Index and population growth. Concurrent with Proposition 4, the Revenue <br />and Taxation Code, Section 7910, requires each local governmental unit to establish its <br />appropriations limit by the beginning of each fiscal year. <br />Due to Gann’s constraint on State and local governments to respond effectively to the <br />demands of rapid growth around California, a legislative-business-labor coalition drafted and <br />supported Proposition 111, which was adopted June 5, 1990. Proposition 111 makes crucial <br />adjustments to the Gann Initiative, by allowing it the flexibility to operate in a growing <br />economy, while retaining its purpose in placing a limit on government spending. The following <br />are the changes Proposition 111 made to the Gann Initiative. <br />Prior law required spending limits to be tied to the Consumer Price Index or California Per <br />Capita Personal Income growth factor, whichever was lower . The new provisions allow an <br />agency to select the California Per Capita Personal Income growth factor or the <br />Non-residential Property Assessed Valuation growth factor , whichever is higher. Cities may <br />Page 1 City of San Leandro Printed on 5/27/2014