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CalPERS, with additional increases projected in future years. The City has offset some of these <br />increases with staff reductions in recent years, and will be working with employee groups over the next <br />couple of years to address this growing cost. Partially mitigating the double digit increases in annual <br />CalPERS funding are extra contributions to the pension from employees, which are up to 9% of salary. <br />The State of California is forecasting a balanced budget over the next 18 months. The State’s savings <br />and borrowings from special funds, property tax shifts, restructuring of the state-local government <br />relationship that shifts funding responsibility to local government for certain services results in a shift <br />of cost being transferred to cities and counties. State lawmakers’ dissolution of redevelopment agencies eliminates funding for redeveloping, improving and revitalizing project and blighted areas in the city. <br />Passage of Prop 55 in November 2016 generates additional tax revenue for the State to mitigate recent <br />deficits. Passage of Proposition 2 in November 2014 allocates General Fund surpluses to a rainy day <br />fund to preserve State services during future economic downturns. Local governments remain alert <br />about how the State will balance its budget and how it might impact local government. <br />Long-term perspective The City adopts an annual budget, but employs long-term planning as the framework for its fiscal <br />decisions. While San Leandro’s underlying economy is viewed as positive in the long-term, today’s <br />economic challenges, notably in the General Fund, must be dealt with now to ensure long-term fiscal stability. The City Council has implemented various cost cutting measures after operating expenditures <br />peaked in 2008-09 to produce recurring budget savings. Such actions result in unwanted, but <br />unavoidable reductions in service to the community. Passage of Measure Z in November 2010 and <br />Measure HH in 2014 have improved revenues enough to ensure no additional reduction in services <br />since 2012. <br />Unassigned Fund Balance in the General Fund equals $29.4 million at June 30, 2016. However, it <br />should be noted that most of the unassigned amounts are designated by the City Council for specific <br />uses. The Unassigned Fund Balance is comprised of $622,000 for Compensated Absences, $5 million <br />for Major Emergencies, $1.2 million for Community Investment, $3.1 million for Economic Uncertainty and $19.5 million from other unassigned balance. In 2015-16, the Unassigned Fund <br />Balance increased by $10.2 million when compared to 2014-15. <br />MAJOR INITIATIVES AND ACCOMPLISHMENTS <br />In its role of providing policy direction and general oversight, the City Council establishes major goals <br />for City service delivery. These goals are identified and quantified in the City’s annual budget. The <br />City can boast of an impressive list of major initiatives and accomplishments during 2015-16 that <br />helped achieve the City’s mission of serving the public and enhancing the quality of life in San <br />Leandro. Some of these major initiatives and accomplishments include: <br />Capital Improvements <br />Water Pollution Control Plant A $55 million expansion is completed to upgrade the Plant, which was <br />constructed in 1939. The Plant held an open house on April 11, 2016 to enable the public to learn about the completed project. <br />viii