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File Number: 21-005 <br />Unfunded Liability Liquidation (PULL) Plan authorizes the Council to direct up to 50% of all annual <br />General Fund carryover toward the PULL Plan. The goal is to continue to reduce the City’s <br />unfunded pension and retiree medical liabilities. Staff will review this policy/funding amount as <br />part of the FY 2021-23 biennial budget development, taking into consideration the financial <br />conditions in the upcoming years. <br />The financial report listing revenues by category and expenditures by department is attached to <br />this staff report. <br />Summary of (Current) Fiscal Year 2020-21 Significant Financial Transactions and <br />Updates <br />When the COVID-19 pandemic hit in the third quarter of FY 2019-20, the City adjusted its revenue <br />and expenditure projections for FY 2020-21. Revisions to the budget were necessary to reflect <br />the changes in financial conditions. Like many other cities across the country, the City took a <br />conversative approach to project revenues and implemented strategies to control costs and <br />preserve reserves. These strategies are consistent with best practices and are necessary to <br />ensure the City’s long-term fiscal health. <br />Certain economic and financial data has changed since the budget was amended in June 2020. <br />Some changes were approved by the City Council in the form of appropriations/budget <br />adjustments in the first part of FY 2020-21; the significant budget adjustments are described <br />below. Other key financial factors will also be evaluated and incorporated into the upcoming <br />mid-year budget review. The financial highlights are presented below. Staff is planning to <br />present the mid-year budget review to the City Council in early spring 2021. <br />Budget Adjustments <br />Significant adjustments approved by the City Council are summarized below: <br />Revenue Adjustment <br /> <br />·The City Council authorized the transfer of $4.9 million unspent Capital Improvement <br />Project (CIP) funds back to the General Fund. Sending the money back to the General <br />Fund helps the City to preserve its reserves and assist with weathering the revenue losses <br />resulting from the COVID-19 pandemic. It also provides the City the flexibility to better <br />manage the current year spending plan while planning for the 2021-23 budget cycle. <br />Funding for certain projects is still needed in future years and contributions back to the CIP <br />Fund will be reflected in the General Fund long-term forecast <br />Expenditure Adjustments <br />·Fiscal Year 20-2021 will see an increase of $1.4 million to the budget due to carryover <br />requests from Fiscal Year 2019-20 for services and programs that did not occur in FY 19- <br />20 but should be completed this year. <br />·Fiscal Year 20-2021 will see an additional increase of $3.0 million to the budget due to the <br />rollover of unspent encumbrances from FY 2019-20 for contracts. Consistent with the <br />City’s policy, the annual carryover of unspent encumbrances does not require separate <br />Page 3 City of San Leandro Printed on 1/14/2021 <br />50