Reso 2019-001 PFA - Laserfiche WebLink

Home

FOCUS: ADDRESSING UNFUNDED LIABILITIES As stated in previous budgets, the City must address legacy pension costs. Although employee benefit formulas have not become any more generous, changed assumptions on the part of CalPERS have resulted in a drastic increase to the City's retirement costs. Increased pension premiums continue to be the primary challenge facing California cities. Four years ago, the Council directed designated contributions to a post -employment liability trust fund account. In short, we are setting aside money to help meet these obligations in the future. To date, the City has vastly exceeded the original contribution goal of $5 million, resulting in over $16 million allocated to this fund. Additionally, through productive negotiations with our labor groups, we have been successful in beginning to address retirement cost allocations. This issue will not go away easily, but the City has made significant progress and will continue to make efforts to address this issue. FOCUS: REVENUE AND FISCAL SUSTAINABILITY This year's budget includes revenues which had been previously passed by the voters and are now contributing to the fiscal stability of the organization. Revenue from Measure 00 assesses a tax to cannabis businesses, Measure PP increased the City's Transient Occupancy Tax (TOT) to 14% tax on City lodging, and Measure NN increased the business license tax on parking lots and on warehouses and reduced the tax for small businesses are all contributing factors to the City's revenue stream. The budget also includes the funds and revenues from Measures HH and BB. Measure HH was approved for a 30 -year period and promises to protect and maintain City services. These include 911 emergency response, neighborhood police patrols, anti -gang enforcement, and library programs for children, adults and families. It also supports after school programs for youth including homework assistance and reading programs, school police officers and crossing guards. The funds also help fill potholes and maintain residential streets. Projections indicate the City will receive $11 to $13 million per year from Measure HH. Measure BB was approved by Alameda County voters and extended the 1% additional sales tax rate for 30 years. This measure is important to San Leandro — it specifically targets transportation improvements such as our road rehabilitation program. The measure produces an annual revenue stream of $1.5 million for street improvements and previously resulted in $30 million in grant funds that the City is now dedicating to street improvements. In FY 2019-20 and 2020-21, Measure BB grant funds are estimated to be $6 to $7 million in each year and will fund street rehabilitation. Additionally, a pool of $30 million grant funds may be allocated for transportation improvements in the City, however the City must apply for these Measure BB grant funds through a competitive process.