HomeMy WebLinkAbout2014-06-03; City Council; 21623; 2014-15 Preliminary Budget WorkshopCITY OF CARLSBAD - AGENDA BILL 16
21,623 AB#
MTG.
DEPT. FIN
06/03/14 Fiscal Year 2014-15 Preliminary
Operating Budget Workshop
DEPT. DIRECTOR
CITY ATTORNEY jg^
CITY MANAGER ^g)
RECOMMENDED ACTION:
Accept report. Set public hearing for June 17, 2014.
ITEM EXPLANATION:
The Operating Budget workshop on June 3, 2014 is an opportunity for the City Council to
review the Fiscal Year 2014-15 Preliminary Operating Budget. City staff will be making
presentations and will also be available to answer questions. The Preliminary Capital
Improvement Program was presented to the City Council at the May 20, 2014 City Council
meeting.
In addition to these meetings, a Citizens Budget Workshop will be held on Thursday, June 5,
2014 at 6 00 p m. at the Faraday Center, 1635 Faraday Avenue, Room 173B, to provide the
public with an opportunity to discuss the Operating Budget and Capital Improvement Program
with staff. The public hearing and adoption of the FY 2014-15 Operating Budget and Capital
Improvement Program is scheduled forthe June 17, 2014 City Council meeting.
2014-15 BUDGET OVERVIEW:
The operating budget for Fiscal Year 2014-15 was prepared against the backdrop of an
Improving economy and an apparent exit from the Great Recession. In previous years, the city
has streamlined department budgets and reduced staffing to minimal levels, focusing cuts on
areas that will minimally effect service levels to our citizens. This budget continues to be
fiscally prudent, but shifts from cost cutting to strategic investment of resources in functional
areas that will allow the city to provide greater levels of service to the community in the future.
The FY 2014-15 operating budget provides funding and sparse increases in staffing in areas
that are key in moving us forward.
In preparing the FY 2014-15 operating budget, citywide departments were offered guidance on
the preparation of their individual budgets. The budget process continues to emphasize
efficiency and fiscal prudence, but also asked departments to identify functional areas that were
key to meeting the developing needs of the City of Carlsbad. The following objectives for FY
2014-15 were established in line with conservative estimates for future revenue growth:
DEPARTMENT CONTACT: Helga Stover 760-602-2429 helaa.stover(a)cadsbadca.gov
DENIED
CONTINUED
WITHDRAWN
AMENDED
FOR CITY CLERKS USE ONL Y.
COUNCIL ACTION: APPROVED J8^
•
•
•
•
CONTINUED TO DATE SPECIFIC • .
CONTINUED TO DATE UNKNOWN •
RETURNED TO STAFF •
OTHER - SEE MINUTES •
Page 2
• Continue to provide excellent services to our residents.
• Provide adequate staff resources to meet community priorities.
• Allow departments to meet escalating costs by providing a modest 2 percent increase for
maintenance and operations.
• Exercise prudence in budgeting, consider cost containment measures and set
discretionary budgets at minimum levels.
• Adjust departmental utilities budgets to meet actual,escalating costs.
The Carlsbad economy has been improving and, with the addition of hotel, retail and
commercial projects, as well as a strengthening regional economy, revenues are trending
upwards, particularly in city sales and hotel tax revenues. The real estate market appears to be
in full recovery, and the national and regional economic outlook is for continued slow growth.
Despite these positive trends, continued challenges include inflation, higher taxes, state and
federal challenges, and unknown implications of regulatory changes, such as those associated
with the implementation of the Affordable Care Act.
Responsible management of the city's resources includes maintaining a focus on a sustainable
future by ensuring the city remains in good financial health, as today's decisions will impact
future spending levels. Although the city is entering the new fiscal year in a solid financial
position, future economic challenges remain. City staff continues to monitor local, state and
federal economic forecasts and routinely updates a ten-year forecast for the General Fund in
order to gauge the effects of today's actions on the city's future. The Preliminary Operating
Budget assumes that overall General Fund revenue will increase by approximately 3.4 percent
in FY 2014-15 compared to the previous year's projected revenue.
The Preliminary Operating Budget for FY 2014-15 totals $227.1 million citywide, which
represents an increase of $12.3 million, or 5.8 percent, as compared to the FY 2013-14
Adopted Budget. Operating revenues are estimated at $232 million, which is about a $7.5
million, or 3.4 percent, increase over the current year's projections. The recommended General
Fund Operating Budget Is $124.5 million, with estimated revenues of $127.3 million. This is a
3.4 percent increase in the estimated General Fund revenues as compared to the projected FY
2013-14 revenues, and a 4 percent increase in General Fund budgeted expenditures compared
to the FY 2013-14 adopted budget.
General Fund Estimated Revenues - The majority of the city's General Fund revenues come
from taxes In the upcoming year, it is expected that property tax revenue will be approximately
$51 6 million. This is an increase of 3.2 percent from the revised FY 2013-14 projections. This
is based on Improving assessed valuations, as provided by the County Assessor in May 2014.
Sales tax revenues generally move in step with economic conditions and have improved
markedly over the past two years (8.1 percent in the last two years). The city's sales tax base
is heavily weighted in the transportation and retail sectors. New auto sales, which comprise
approximately one-quarter of city sales tax revenue, have exceeded pre-recession levels and hit
an all-time high in the last quarter of 2013. City sales tax revenues are expected to increase by
approximately 2 percent in FY 2014-15, contributing $31.7 million to the General Fund. New
retail additions in Carlsbad, such as La Costa Town Square, will add to the sales tax base and
the city will continue to benefit from recent additions, such as the Legoland Hotel and Lowe's,
which opened in fall 2013.
Page 3
The FY 2014-15 revenues for Transient Occupancy Taxes (TOT) are estimated at $16.5 million,
an increase of 3 percent compared to FY 2013-14 estimates. TOT has increased by over 40
percent since FY 2010-11, as new hotels, such as the Legoland Hotel and the Hilton Carlsbad
Oceanfront Resort & Spa have opened in the past years.
Franchise taxes are estimated at $5 million for FY 2014-15, an increase of 2.2 percent over the
FY 2013-14 projections. This increase can be attributed to Consumer Price Index (CPI) growth
and population growth.
Development Revenues are expected to increase by almost 20 percent in FY 2014-15, as a
result of increased projections for industrial and commercial development, and the anticipation
of some larger remodel and refurbishment projects, such as Westfield Cadsbad. Development
Revenues are estimated to be $2.5 million in FY 2014-15, as compared to $2.1 million projected
for FY 2013-14.
General Fund Budgeted Expenditures - The General Fund contains most of the discretionary
revenues that fund basic core city services. The recommended General Fund Operating
Budget is $124.5 million, which represents a $4.8 million, or 4 percent, increase as compared to
the FY 2013-14 Adopted Budget. Personnel cost increases are due to additional staff for Alga
Norte Park operations, anticipated increases in health insurance rates, higher retirement rates
as projected by CalPERS, and previously negotiated wage increases. Maintenance and
Operations increases include department operating requests, utility increases which have been
on the rise over the past few years, a 2 percent allowance for overall rising costs, and other
increases for items such as contractual services.
A few expenditures are discussed in more detail below:
Position Changes
A net increase of 3.0 full-time positions is reflected in the FY 2014-15 Preliminary Operating
Budget, as compared to the FY 2013-14 Adopted Budget. These position additions resulted in
an approximate citywide personnel increase of $278,400 forthe coming year.
The FY 2014-15 Preliminary Operating Budget includes the elimination of the following 8 full-
time positions:
1.0 Administrative Secretary
1.0 Engineering Technician
1.0 Office Specialist II
4.0 Parks Maintenance Worker II (mid-year)
1.0 Tree Trimmer Lead Worker (mid-year)
The FY 2014-15 Preliminary Operating Budget includes the addition ofthe following 11 full-time
positions:
1.0 Business Systems Specialist
1.0 Code Compliance Specialist 11
1.0 Facilities Manager (limited term to permanent)
1.0 Fire Marshall
1.0 Housing Assistant
-2
Page 4
1.0 Management Analyst (non General Fund)
1.0 Office Specialist II
1.0 Secretary
1.0 Senior Applications Analyst (mid-year)
1.0 Training Coordinator
1.0 Traffic Systems Operator
The net increase in hourly staff totals 7.19 FTE. This increase is due to the following:
Additions: Eliminations:
5.58 Alga Norte Park 1.75 Office Assistants
1.00 Building Internship Program 0.30 Technical Assistant
0.50 Community Outreach &
Engagement
2.16 Property & Environmental Mgmt.
These changes result in a city workforce of 670.75 full and three-quarter time employees, and
157.77 hourly, full-time equivalent positions.
New Facilities - As the city completes capital projects, the cost of maintaining and operating
the facilities, including additional personnel if necessary, are added to departmental operating
budgets. Funding has been added to the Parks & Recreation Department and to the Property
& Environmental Management Department budgets to operate and maintain Alga Norte Park,
which opened to the public in January 2014; the FY2013-14 budget included funding for only
part of the prior fiscal year. Funding for operating the concessions at Alga Norte Park was
added to the FY 2014-15 Parks & Recreation Department budget; previously it was not known
whether or not this service would be managed externally or internally with department staff.
These positions are related to concessions and rentals which are revenue generating activities.
Capital Outlay - There are two major capital outlay purchases (greater than $10,000) planned
in the General Fund for FY 2014-15:
. Three Cardiac Monitors ($100,344 in total)
. Vehicle for Community Relations Manager ($28,620)
Other Budget Requests - The FY 2014-15 Preliminary Operating Budget also includes the
following transfers to other funds:
. $8,302,000 million to the Infrastructure Replacement Fund for major maintenance and
replacement of city infrastructure. This represents 6.5 percent of the General Fund
Revenues, the same as the percentage transfer for FY 2013-14.
. $251,962 to the Storm Water Program for reimbursement for the General Fund portion
of Storm Water expenses.
. $539,000 to the Median Maintenance and Street Tree Maintenance Special Revenue
Funds to cover cash shortfalls, as annual assessments collected from property owners
do not cover annual operating expenditures.
• $1,031,240 to the city's municipal golf course for debt service.
4
Page 5
Finally, the Contingency is budgeted at 1.2 percent of the General Fund Operating Budget, or
$1.5 million, for FY 2014-15, which is equal to the FY 2013-14 Adopted Budget. This resource
is available to the City Council to address unanticipated emergencies or unforeseen program
needs throughout the year.
Other Funds - Enterprise Fund revenues, including Water, Wastewater Services and Solid
Waste Management, are projected at $71.8 million, an increase of $2.6 million, or 3.8 percent,
over current year projections. The budgeted expenditures are estimated at $68.8 million for FY
2014-15, which is an increase of $2.9 million, or 4.4 percent, over the FY 2013-14 Adopted
Budget. The most significant change in Water Operations is due to the estimated increase in
the cost of water purchased from the San Diego County Water Authority (5 percent increase in
fixed and variable costs). The Operating Budget also includes funding for depreciation
replacement transfers related to growth and aging of the water infrastructure system.
Wastewater operations are projected to increase 10.7 percent, or $1.2 million, of the total $2.9
million overall increase in Enterprise funds. This increase in the operating budget is primarily
due to an increase in the depreciation replacement transfer to reflect an adjustment made to the
city's share of the Encina treatment plant assets. Other increases were seen in utility costs, and
parts and supplies related to infrastructure asset maintenance.
Golf Course operations are expected to remain relatively flat for FY 2014-15.
Revenues from Special Revenue Funds at $10.6 million are relatively flat when compared to FY
2013-14. While there are several Special Revenue funds with fluctuations from year to year, the
most significant decrease is in funding in CDBG grant funding. The types of items supported
within special revenue funds include grants, donations, special fees, and assessments.
Revenues do not always match expenditures in a given year due to timing differences related to
the receipt of grant and donation funding.
The budgets for the Redevelopment Obligation Retirement Funds (RORF) budgets total $1.3
million, with no change from the previous fiscal year.
More information regarding all of the city's projected revenues and Operating Budget
recommendations can be found in the attached exhibits.
FEES AND CHARGES FOR SERVICES
One of the City Council's goals is to annually evaluate fees and charges for services. A Cost of
Service Study was updated in FY 2012-13 to verify that fees don't exceed the cost of providing
the service. This study is updated every two years, so during FY 2014-15 it will be updated and
changes will be reflected in the FY 2015-16 Operating Budget. Staff has reviewed all of the fee
schedules and is recommending the changes as shown in Exhibit 6, and further discussed
below.
GENERAL CITY FEES
These are fees charged for the usage of city services and property, such as rentals. These
fees are increased annually by the increase in the annual West Urban Consumer Price Index
(CPI) published by the Bureau of Labor and Statistics, which reflects the cost of inflation. The
one year change in CPI is 1.48 percent. In addition to the general increase mentioned and
Page 6
changes that were the result of the updated Cost of Service Study, there were increases to
bring fees up to the current actual cost of the service provided. The following fees are
proposed to change for FY 2014-15:
New Fees:
• Parks - Major Trail Plan Check >1 Mile - $1,400. This fee is part of the Cost of
Service Study and is currently being charged. It is just being added to the Master Fee
Schedule.
• Parks - Minor Trail Plan Check <1 Mile - $700. This fee is part of the Cost of Service
Study and is currently being charged. It is just being added to the Master Fee
Schedule.
• Parks - Trails Inspection - $300. This fee is part of the Cost of Service Study and is
currently being charged. It is just being added to the Master Fee Schedule.
Increased Fees:
Paramedicine Pilot Program:
Beginning January 1, 2015, Carlsbad will be participating in a state program designed to
enhance customer service and potentially save a patient money by transporting the patient
to a facility (either a different hospital that is part of their insurance plan, or another type of
facility, such as Urgent Care) that is able to offer the appropriate treatment, at a lower cost.
The charge for transporting the patient is the same; the end destination may be different.
Ambulance Transport - Community Paramedicine BLS - Resident - $938.26
Ambulance Transport - Community Paramedicine ALS - Resident-Plus Level I or Level
II Supplies & Medications - $1,150
Ambulance Transport - Community Paramedicine - Level I Supplies and Medications -
$125.
Ambulance Transport - Community Paramedicine - Level II - Supplies and Medications
- $250.
Trash Removal - Waste Management increased these pass through fees on January
1,2014.
Ambulance Fee - Advanced Life Support 1 - Resident - Plus Level I or Level II
Supplies and Medications - $1,150.
Ambulance Fee - Advanced Life Support 1 - Non-Resident - Plus Level I or Level II
Supplies and Medications - $1,250.
Ambulance Fee - Advanced Life Support 2 - Resident - Plus Level II Supplies and
Medications-$1,250.
Ambulance Fee - Advanced Life Support 2 - Non-Resident - Plus Level II Supplies and
Medications-$1,350.
Ambulance Fee - Advanced Life Support I - Assessment increasing from $156.38 to
$200.
Ambulance Fee - Mileage Charge per mile increasing from $17.72 to $23.
Ambulance Fee - Oxygen Charge increasing from $67.76 to $75.
Page 7
Decreased Fees:
• Police Report Copy Fee (Free to Victim) plus cost of reproduction from $16 to $10
• Community & Economic Development - Certificate of Compliance in Lieu of Parcel
Map from $3,580 to $3,000.
Fees to be removed from Master Fee Schedule:
• Library Facility Fees and Schulman Auditorium AudioA/ideo Fees will be moved off the
Master Fee Schedule and placed in a department publication.
• Ambulance Fee Supplies Charge - Actual cost plus 30 percent is being replaced with
a bundled supplies charge.
DEVELOPMENT RELATED SERVICE FEES
These are fees charged to recover the cost of staff time and materials spent on development
related activities. Annually, Development Related Service Fees are increased by an index
stated in the respective resolution or ordinance establishing the fee. An annual review is
conducted to ensure that the fees being charged do not exceed direct and indirect costs of
providing the service. The Cost of Service Study is available from the Finance Department
upon request.
For FY 2014-15, Development Related Service fees will be increased by the one year change
in the associated index. Other fee changes are discussed below:
New Fees:
• Community & Economic Development - Non Conforming Permit - $697
• Building Valuation Multipliers schedule has always been used but is now being added
to the Master Fee Schedule.
Deleted Fees:
The following fees are being removed due to amendments to the municipal code:
Community & Economic Development - Administrative Permit - lODA
Community & Economic Development - Daycare Permit - Center Admin Pmt
Community & Economic Development - Daycare Permit - Extension
Community & Economic Development - PD/Condo - Minor Amendment
Community & Economic Development - Planned Industrial Permit
Community & Economic Development - Planned Industrial Permit - Amendment
n
Page 8
Development Related Service Fees that are increasing:
• Fish and Game Fee - EIR - is increasing from $3,045.25 to $3,079.75. This fee is set
by state statute and is a pass through fee.
• Fish and Game Fee - Negative Declaration - is increasing from $2,206.25 to
$2,231.25. This fee is set by state statute and is a pass through fee.
• Street Light Energizing Fees - will be increasing due to the induction rate charged by
San Diego Gas & Electric.
DEVELOPMENT IMPACT FEES
These fees are used to recover the cost that growth will have on city infrastructure. These
fees will be increased by the index stated in the respective resolution or ordinance
establishing the fee, typically the Engineering News Record (ENR) construction cost index.
ENVIRONMENTAL IMPACT:
Pursuant to Public Resources Code Section 21065, giving a presentation on the preliminary
operating budget does not constitute a "project" within the meaning of CEQA in that it has no
potential to cause either a direct physical change in the environment, or a reasonably
foreseeable indirect physical change in the environment, and therefore does not require
environmental review.
EXHIBITS:
1. Fiscal Year 2014-15 Preliminary Operating Budget (Overview)
2. Operating Funds, Projected Fund Balances for FY 2013-14 and FY 2014-15
3. Operating Funds, Revenue Estimates for FY 2012-13 through FY 14-15
4. Operating Funds, Budget Expenditure Schedule FY 2011-12 through FY 2014-15
5. Personnel Allocation Schedule FY 2012-13 through FY 2014-15
6. Proposed Fee Changes - FY 2014-15
The Preliminary Operating Budget and Capital Improvement Program for Fiscal Year 2014-15
is on file with the City Clerk.
^ CIT¥ Of
CARLSBAD
Exhibit 1
CITY OF CARLSBAD
2014-15 PRELIMINARY BUDGET
Carlsbad Is a full-service city providing the following:
• Police department
• Fire department, including paramedic
• Water delivery system
• Sewer system
• Solid waste services
• Housing programs
Development services
Street construction and maintenance
Library and arts programs
Recreation programming for all ages
Park lands
Municipal golf course
School Programs and
facilities are provided by
four different school
districts located within
the city boundaries.
Although the City
Council has no direct
control over these
school districts, the
Council recognizes the
importance of quality
school facilities and
programs to Carlsbad's
residents. The Council
has worked closely with
the schools in the past,
and staff continues to
meet with them on a
regular basis.
BUDGET PROCESS
At the beginning of
each year, the City
Council meets to
develop goals that help
city staff prioritize
programs, projects and
services, as well as the
resources required to
fund them. Based on
this direction, and input
received at public
workshops, city staff
finalizes the overall city
work plan, and the City
Council approves a
budget for the fiscal
year.
City of Carlsbad Community Vision
Small town feel, beach community character and connectedness
Enhance Carlsbad's defining attributes—its small town feel and beach community
character. Build on the city's culture of civic engagement, volunteerism and
philanthropy.
Open space and the natural environment
Prioritize protection and enhancement of open space and the natural environment.
Support and protect Carlsbad's unique open space and agricultural heritage.
Access fo recreation and active, healthy lifestyles
Promote active lifestyles and community health by furthering access to trails, parks,
beaches and other recreation opportunities.
The local economy, business diversity and tourism
Strengthen the city's strong and diverse economy and its position as an employment
hub in north San Diego County. Promote business diversity, increased specialty retail
and dining opportunities, and Carlsbad's tourism.
Walking, biking, public transportation and connectivity
Increase travel options through enhanced walking, bicycling and public transportation
systems. Enhance mobility through increased connectivity and intelligent
transportation management.
Sustainability
Build on the city's sustainability initiatives to emerge as a leader in green development
and sustainability. Pursue public/private partnerships, particularly on sustainable
water, energy, recycling and foods.
History, the arts and cultural resources
Emphasize the arts by promoting a multitude of events and productions year round.
Cutting edge venues to host world class perfomiances, and celebrate Carlsbad's
cultural heritage in dedicated facilities and programs.
High quality education and community services
Support quality, comprehensive education and lifelong learning opportunities, provide
housing and community services for a changing population, and maintain a high
standard for citywide public safety.
Neighborhood revitalization, community design and livability
Revitalize neighborhoods and enhance citywide community design and livability.
Promote a greater mix of uses citywide, more activities along the coastline and link
density to public transportation. Revitalize the downtown Village as a community focal
point and a unique and memorable center for visitors, and rejuvenate the historic
Barrio neighborhood.
A-1 9
Exhibit 1
The Carlsbad City Council has set a vision to make Carlsbad a truly world class city by fulfilling
the core values outlined in the community's vision of the future, with a particular emphasis in
several strategic areas of focus. In 2014-15, the city organization will continue to adapt to
changing needs and expectations by being adaptable, responsive and efficient, delivering the
most cost effective, high quality services and retaining a highly trained, flexible and responsive
staff. Given the importance of a strong local economy, the city will continue its work to create
jobs by attracting talent to Carlsbad and helping existing business to thrive. In the coming year,
the city is on track to complete its General Plan update, adapting city land use policies to
address population and demographic trends while maintaining the city's high standards and
quality of life. The city will also complete its parks and recreation needs assessment, charting a
course for the future development of parks, community centers and recreational services.
Carlsbad streets will continue to evolve to accommodate and encourage all modes of
transportation, not just cars. And, the city will maintain a strong focus on fostering the next
generation of community leaders through programs, training and engagement opportunities at
all levels of city government.
Carlsbad's operating budget is a tool that guides the achievement of Council's vision, goals, and
priority projects for the city. The budget allocates resources to city programs in accordance with
priorities established by residents and the Council. Thus, it Is an integral part of making
Cadsbad a wonderful community in which to live, work and play. In addition, the budget is
fiscally conservative and balanced, and provides a blueprint to effectively sustain the community
and essential city services far into the future.
ECONOMIC PROFILE
^ I The US economy is sputtering towards
*. f recovery, as indicators show signs of very
1 modest improvement. In April 2014, the Bureau
I of Economic Analysis released an initial
I estimate of gross domestic product (GDP),
I which indicated an anemic growth rate of one-
I tenth of one percent. Fourth quarter GDP
. — . ^ showed growth of 2.6 percent for the country.
i However, economists believe that economic
' « , tv , , t. « . , » ,v . .• *i w . I activity in these quarters, as measured by GDP,
% mo mi mt MU MUI was stifled by unusually harsh weather
; ,tlI conditions experienced in many areas of the
v.M.nMWHM United States and drought conditions persisting
in the southwestern US. The unemployment rate fell to 6.3 percent in April, an improvement
over the 7.4 percent rate for 2013. Nonfarm payroll increased by 288,000 in April, and February
and March saw relatively strong growth in employment of over 200,000 per month. The UCLA
Anderson forecast, released in April, predicts that GDP will grow at 3 percent through 2016 and
that the unemployment picture will continue to improve, dropping to 5.4 percent by late 2016.
UCLA economists expect inflation to raise modestly, to 2.5 percent in 2016, and that the Federal
Funds rate will increase to 3 percent by the end of 2016.
Nationally, the housing market is cooling slightly, as indicated in the most recent Case-Shiller
data for the twelve months ending in February. Compared to the year ending January 2014, the
index indicated that home prices fell a very modest one-tenth of one percent. According to
David M. Blitzer, Chairman of the Index Committee, "the annual rate cooled the most we've
seen in some time." Housing start remained under one million for 2013, but are expected to
grow to almost 1.5 million in 2015, and is then expected to plateau as mortgage rates increase
to over 6 percent, following inflation and Federal Reserve actions.
Ill llllll .ill
A-2 ID
Exhibit 1
The national economy should continue a modest expansion over the next few years, as
businesses and consumers increase consumption. The rising stock prices witnessed in 2013
(the S&P index rose by 26 percent during the year) should excite consumer spending and take
pressure off retirement accounts and corporate spending is also likely to increase, as
businesses replace aging capital equipment.
The California economy continues to improve, marginally, although the effects of the drought
may have some minor negative effects on the recovery, particulady in employment. According
to Bureau of Labor Statistics (BLS) data, the employment picture has improved over the past
years, as preliminary number for March indicate that the unemployment level has dropped to 8.1
percent (keep in mind that the state reached an unemployment rate of 12.3 percent in 2010).
The state's unemployment rate is not expected to dip to 6 percent until 2016, according to the
Anderson Forecast.
While the state economy and employment pictures improve, California is still an economically
bifurcated state. In the western portion of the state, employment gains have outpaced those at
the national level. However, the inland counties have seen shrinkage in government and
construction sectors, which continue to put a drag on a slow recovery. Home prices show
positive signs in coastal California, compared to the national averages. The most recent Case-
Shiller Home Price Index indicated an overall year-over-year increase of 12.9 percent for
February. However, Los Angeles, San Diego, and San Francisco all topped 18 percent rates of
increase, and DataQuick indicates that median prices in California climbed to $376,000 in
March, an increase of 20.1 percent compared to last year. However, the number of homes sold
in March reached the lowest level (24,565) since 2008. Construction activity, both residential
and non-residential, are expected to grow through 2016, as are taxable sales.
San Diego County shows improvement in unemployment and home prices. The unemployment
rate hit 6.9 percent in March, an improvement from 7.8 percent, last year. The county added
32,600 jobs over the year ending in March, but many of these jobs were created in lower-paying
sectors, such as leisure and hospitality. As Marney Cox, chief economist for the San Diego
Association of Governments (SANDAG) points out, "It will be another mediocre year [2014].
Nothing substantial." San Diego's economy is also predicted to suffer from military cutbacks,
which will negatively impact tourism and taxable sales.
Home prices continue to rise in San Diego County. According to DataQuick, the median price
for a residence rose by almost 12 percent (to $426,000) In March, compared to a year ago. The
Case-Shiller Home Price Index indicates that San Diego has some of the highest price
appreciation in the nation with a year-over-year increase of almost 20 percent in February.
Monthly appreciation (February over January) was more 1 percent. Sales volume fell by almost
19 percent in March, compared to the prior year. Residential building permits increased by 46
percent in 2013, the strongest showing since 2006, with much of the increase in multi-family
residential.
Index of Leading Economic
Indicators
San Diego County, 2009 - 2013
The chart reflects historical movement in the
USD's Leading Economic Indicators. The
index, which measure local stock prices, help
wanted advertising, and other pertinent
metrics, turned mildly negative (-0.2 percent)
in the last month of 2013.
Carlsbad's economy is tied closely to that of
the San Diego region. For FY 2013-14,
property taxes decreased by 2.5 percent
compared to the prior year, primarily due to
one-time revenues received from the
A-3
Exhibit 1
dissolution of the Redevelopment Agency In FY 2012-13. Transient Occupancy Tax (TOT), a
gauge of the health of local tourism, is expected to end FY 2013-14 with a 13.4 percent increase
over last year, due to the additional room inventory and improving occupancy and daily rates.
Sales tax revenues are expected to end FY 2013-14 with an increase of 6.2 percent due to the
continuing strength in retail and auto sales. Overall, General Fund revenues are projected to
decrease by less than one percent compared to the prior fiscal year, but will increase
substantially (3.4 percent) in FY 2014-15.
Median SFR Home Prices
Housing prices in Carlsbad
are following national, state
and regional trends. Data
on single family residence
(SFR) sales from
DataQuick indicate that the
median sales price
increased to approximately
$720,000 In the first
quarter of 2014, an
increase of over 10 percent
compared to the same
quarter in 2013. According
to Movoto, inventory of
units for sale have
increased in Carlsbad, from 255 units in April 2013 to 337 units for sale, this April. The total
assessed values in the city are close to $24 billion, an increase of 1.9 percent compared to the
prior fiscal year (FY 2012-13). According to recent growth projections prepared for the city,
Carlsbad will add 920 residential units over the next five fiscal years.
900
800
700
•S 600
I 500
i 400
JE 300
200
100
0
2006 2007 2008 2009 2010 2011
Fiscal Year
2012 2013 2014
From 1992 to 2008, commercial and industrial development in Carlsbad averaged
approximately 1.1 million square feet per year. As opportunities for new development diminish,
commercial and industrial development is tapering off, falling to an average of approximately
162,000 square feet per year over the next five fiscal years. Large industrial and commercial
developments in the next five years include Carlsbad Raceway and Palomar Forum, Dos
Colinas Retirement Community, and the Floral Trade Center. Commercial office space vacancy
has witnessed a decline over the past several years, falling from over 30 percent in the last
quarter of 2009 to just under 20 percent in the first quarter of 2014. Industrial vacancy fell to
10.1 percent from 12.4 percent, last year.
Commercial development has brought much needed entertainment and shopping venues to
citizens and visitors alike, as well as generating additional sales taxes to help pay for city
services. Carlsbad is home to Car Country Carlsbad - an auto mall; the Carlsbad Premium
Outlets - a specialty outlet center; Plaza Camino Real - a regional shopping mall; a Costco
center; and the Forum at Carlsbad - a commercial center with upscale retail shops, restaurants
and other commercial uses. A new Lowe's opened in fall 2013, and La Costa Town Square is
scheduled to open in FY 2014-15.
Development has also enhanced Carlsbad's reputation as a destination resort for tourism. The
city is host to a major family theme park, Legoland, and has two luxury resorts available for its
visitors, the Park Hyatt at Aviara and the La Costa Resort & Spa. There are also a number of
other quality hotels and motels In the city, with the most recent additions being the Hilton
Oceanfront Resort & Spa and the Legoland California Resort.
The City of Carlsbad opened a municipal golf course in the summer of 2007 which has further
enhanced the tourism attractions the city offers. The municipal golf course. The Crossings at
Carlsbad, Is an 18-hole, destination golf course set in the rolling hills and canyons of Carlsbad.
A-4 1^
Exhibit 1
With ocean views, high quality golf experience, a first class restaurant and clubhouse, and
linkages to hiking trails. The Crossings at Carlsbad is a destination spot for golfers and non-
golfers alike.
it is the Council's goal to ensure that the city remains in good financial health, and there are a
number of steps the city has taken to attain that goal. One of the steps is the Growth
Management Plan. This plan was adopted by the citizens to ensure that all necessary public
facilities were constructed along with development. It also ensures that a financing plan is In
place to pay for the facilities prior to the development of the property.
In addition to the Growth Management Plan, the city also prepares a long-term financial model
for both the capital and operating needs of the city. With a growing city such as Carlsbad, it is
imperative that we plan for the impacts ofthe economy, serving new development and operating
new public facilities, as well as planning for capital needed to build them. Thus, the city prepares
a ten-year operating forecast for the General Fund, and a 15-year Capital Improvement
Program. As part of the Capital Improvement Program, the city annually calculates the amounts
needed to pay for the various projects, and calculates the anticipated operating budget impacts.
In this way, the city can anticipate the effects of development from both a capital and an
operating perspective.
One important initiative the city has undertaken to ensure its financial health is the development
of an Infrastructure Replacement Fund. With this fund, the city sets aside a portion of General
Fund revenues on an annual basis for major maintenance and replacement of its infrastructure.
Much of the city's infrastructure is relatively new; thus, the city is just now experiencing the
impact of maintenance requirements. By setting aside funds now, the citizens of Carlsbad can
be assured that the proper maintenance and replacement, as needed, will be performed on
streets, parks and many facilities for which the city is responsible.
General Fund Revenues (Top 5)
120,000
tn 100,000
c _o 80,000
i 60,000
40,000
20,000
• I lil ^llliil""l •other Franchise
• SDGE Franchise
•TOT
• Property Tax
•Sales Tax
2006 2009 2012
Fiscal Year
2015e
As national and
local economic
conditions begin to
improve, Carlsbad
is well positioned to
reap the benefits of
a diverse business
composition. Over
the past decade,
the city has
developed an
economic base that
attracts business,
tourism, and retail
consumers. The
city hosts four regional shopping areas within its boundaries; an auto mall, a large regional mall,
an outlet center, and a high-end retail center in the southern part of the city called The Forum. A
strong tourism industry is served by Legoland and a host of resorts and hotels, as mentioned
previously. All of these factors, combined with relatively stable property values, provide a strong
revenue base to support the high level of city services for our residents. In FY 2014-15, the city
is expected to generate almost $100 million, or 78 percent of General Fund revenues, from
three main sources: property taxes, sales taxes, and transient occupancy taxes (TOT).
Overall, for FY 2014-15, General Fund revenue is projected to increase by 3.4 percent from the
previous year's estimates. Most major sources of tax revenue are expected to increase slightly
in FY 2014-15, including property tax (3.2 percent increase), following several years of stagnant
growth. Sales tax is expected to increase by 1.8 percent and TOT revenues are projected to
increase by 3 percent as occupancy and average daily rates (ADR) increase and new hotels,
A-5
Exhibit 1
such as LegoLand, continue to draw visitors. Home values are showing substantial
appreciation, which is expected to improve assessed values in the coming years. Development
related revenue items are forecast to increase modestly In FY 2014-15, due primarily to an
increase in commercial and industrial activity, as compared to the previous fiscal year.
State of California - In January, Governor Jerry Brown submitted a balanced
budget to the California legislature. The combined effect of Proposition 30, passed
in 2012 by California voters to authorize temporary increases in sales and income
taxes, and the recovering economy have taken pressure off of the budget and
allowed the state to bridge the sizable deficits experienced in prior years.
The proposed budget for FY 2014-15 relies on projected revenues of 108.7 billion to cover
$106.8 billion in expenditures. The budget also addresses the "wall of debt" that was built up by
the state in eadier budget cycles, as it attempted to cover shortfalls. Under the governor's plan,
this debt of $24.9 billion will be eliminated by the end of FY 2017-18. The budget also sets
aside $1.6 billion in a budget stabilization account to allow the state to face future uncertainties.
Of course, the state still has looming fiscal issues to tackle, including unfunded pension
liabilities of over $217 billion dollars for state workers, teachers, university workers, and judges.
The state also relies heavily on capital gains taxes (these will account for $4 billion in additional
revenue in FY 2014-15) and this revenue source has proven extremely volatile In past years.
The budget also assumes that federal court will grant a two-year extension to California's
requirement to meet the capacity threshold of its prisons, which is uncertain. Finally,
Proposition 30 is temporary, and the sales tax increase expires in 2016, followed by expiration
of the income tax increase in 2018.
California, as mentioned previously, continues to face sizable pension liabilities. The reform
enacted under Assembly Bill 340 should decrease pension costs in the long-run, but more
reforms are being proposed, including a measure proposed by San Jose Mayor Chuck Reed,
which would effectively allow cities to change pension benefits going fonward for public
employees. General Fund expenditures in the proposed budget increased by 8.5 percent, with
significant increases In K-12 education and transportation, while revenues are expected to
increase by 5.9 percent in FY 2014-15.
Looking Forward
In order to strategically address the future needs of the city and to ensure that we maintain a
structurally balanced budget in the long term, the city prepares a ten-year financial forecast.
Revenue projections are developed based on current and forecasted economic variables at the
national, state, and local levels, and provide city leaders with some measurement of future
capacity to support city programs and services. In recent years, revenue growth has become
more difficult to project in the long-term, as we find ourselves in an economic climate that
changes rapidly and unpredictably, and the forecast allows decision makers to adjust for these
changes. The ten-year forecast is updated frequently to avoid potential pitfalls and to ensure
that we identify and resolve fiscal challenges and continue to develop a balanced and
responsible budget.
Over the past several years, the city has addressed the budgetary challenges brought on by the
recent recession and taken deliberate measures to continue to allocate resources in a
responsible manner, minimizing the impact to users of city services. These measures included
a reduction in full-time and hourly full-time equivalent (FTE) positions, delaying the construction
of non-essential capital projects, reducing the funding for capital outlay and goal projects,
reducing and/or eliminating cost of living salary increases, requiring employees to pay a larger
portion of their retirement costs, using technology and other tools to create efficiencies, and
reducing certain non-essential service levels with a minimal impact to the community.
A-6 /V
Exhibit 1
The ability to anticipate changes in revenue sources and to balance those resources against the
costs related to ongoing and future programs, services, and infrastructure requirements is
critical to the financial health of the city. The city relies on the General Fund forecast to
effectively manage fiscal resources and map a sustainable and responsible path for attaining
the goals of the community. The tumultuous economic environment experienced in the past few
years makes this long-term perspective even more important.
The forecast assumes limited growth in residential and commercial development over the next
decade and captures the expected revenue impacts from major projects that are expected to be
completed during the forecast period. Ongoing transfers to the Cadsbad Crossings Golf Course
are expected to continue over the forecast period; however, the transfer is expected to decrease
steadily over the ten-year forecast horizon. The operating costs of new city facilities projected in
the Capital Improvement Program and supported by the General Fund, such as Alga Norte
Park, are also captured in the forecast. Economic conditions at the national, state, and local
level are expected to continue improving at a modest rate and to provide a boost to most of our
major sources of revenue. Home prices, which have been slumping for several years, are
continuing to increase substantially and will begin to provide a boost to the city's property tax
revenues In the following years. Overall, the outlook for General Fund revenues has improved,
since the last fiscal year, and revenues are expected to exceed ongoing operating costs.
General Fund Revenues and Expenditures
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-212021-22 2022-23 2023-24
Fiscal Year I Revenues
-Total Expenditures
The forecast assumes that General Fund revenues will increase by a little over three percent in
FY 2014-15, as improving economic conditions buoy revenues from the property taxes, sales
taxes and TOT. To project the expenditures, all known changes in personnel and maintenance
and operations costs are accounted for. However, the effects of future negotiations with
employee bargaining units are not contemplated in the current ten-year forecast. The city is
currently undertaking an evaluation of services in order to pursue a managed competition
process, known as Best Value Services. The financial impact of a change in service delivery is
also not considered in the ten-year forecast.
The forecast assumes that the city's cost for employee health care will increase by five percent,
annually, over the life of the forecast. Pension plan costs continue to be a major driver of
overall personnel costs for the city. CalPERS, the pension plan which funds city employee
pension benefits, has recently decided to substantially increase required annual pension
contributions from participating agencies in order to fully fund outstanding pension obligations
within 30 years. This decision, coupled with a new mortality assumptions (pensioners are living
A-7
Exhibit 1
longer), will substantially increase personnel costs for the city and are contemplated in the
current ten-year forecast. The cumulative effect of the five year ramp-up in pension costs will
increase the General Fund's annual contribution by 45 percent from FY 2015-16 to FY 2019-20.
In order to address the underfunded status of pensions, the City Council has set aside $2 million
in last years' budget to mitigate these increasing costs. The forecast further assumes that no
new positions are authorized after FY 2014-15, except those that may be related to the
operating costs of new city facilities supported by the General Fund. Negotiated salary step
increases and cost of living increases are included in personnel costs, in order to provide a
conservative estimate of future costs. The contribution from the General Fund to the
Infrastructure Replacement Fund is forecasted to remain at 6.5 percent of General Fund
revenues. Finally, the forecast includes estimated operating costs for all capital projects in the
timeframes shown in the Capital Improvement Program (CIP).
As indicated in the above graph, the General Fund is balanced for FY 2014-15 and revenues
exceed expenses over the life of the forecast. Although the revenue forecast is optimistic,
Carlsbad is still exposed to a fragile and slowly recovering economy, which could rapidly
deteriorate and adversely affect local revenues. Despite these threats, responsible fiduciary
stewardship and planning have placed the city in a position to benefit from even modest
improvements in the economic environment.
A-8
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
The Preliminary Operating Budget for Fiscal Year 2014-15 totals $227.1 million, with revenues
for the year estimated at $232 million. General Fund-revenues are estimated at $127.3 million
and General Fund budgeted operating expenditures are $124.5 million.
REVENUE
The following table shows the total operating revenues anticipated to be received by the city for
FY 2013-14, as well as those estimated for FY 2014-15.
REVENUE SUMMARY
BY FUND TYPE
(in Millions)
FUND
PROJECTED BUDGETED $ %
FUND 2013-14 2014-15 CHANGE CHANGE
GENERAL FUND $ 123.0 $ 127.3 $ 4.2 3.4%
SPECIAL REVENUE 10.9 11.2 0.3 2.9%
ENTERPRISE 69.2 71.8 2.6 3.8%
INTERNAL SERVICE 19.7 19.7 -0.1%
REDEV. OBLIG. RETIREMENT 1.6 2.0 0.4 22.4%
TOTAL $ 224.5 $ 232.0 $ 7.5 3.4%
Revenue estimates for the Operating Budget indicate that the city will receive a total of $232
million in FY 2014-15, a $7.5 million, or 3.4 percent, increase over the prior year's projections.
The significant changes from the prior year include a $2.7 million, or 2.7 percent, increase in the
General Fund for increases In Property Tax, Sales Tax and Transient Occupancy Tax revenues.
The Special Revenue Funds show an increase of $317,000, or 2.9 percent from the prior year
due to increases in grant funding and special benefit district charges. Enterprise revenues are
expected to increase $2.6 million, mainly due to increased water sales revenues needed to pay
for the rising cost of water purchased from the San Diego County Water Authority, and
increased golf course revenues. More information on the city's revenue sources can be found
in the discussion that follows.
General Fund
General Fund revenues provide a representative picture of the local economy. These revenues
are of particular interest as they fund basic city services, such as Police, Fire, Library, Street
and Park Maintenance, and Recreation programs. The following table provides a summarized
outlook for the major General Fund revenues. .
SIGNIFICANT GENERAL FUND REVENUES
PROJECTED
2013-14
BUDGETED
2014-15
$
CHANGE
%
CHANGE
PROPERTY TAX $ 50.0 $ 51.6 $ 1.6 3.2%
SALES TAX 31.1 31.7 0.6 1.8%
TRANSIENT OCCUPANCY TAX 16.0 16.5 0.5 3.0%
FRANCHISE TAXES 4.9 5.0 0.1 2.2%
BUSINESS LICENSE TAX 3.7 3.8 0.1 4.0%
DEVELOPMENT REVENUES 2.1 2.5 0.4 19.6%
ALL OTHER REVENUE 15.4 16.3 0.9 5.9%
TOTAL $ 123.0 $ 127.3 $ 4.2 3.4%
B-1 in
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
As we emerge from the Great Recession, General Fund revenues indicate healthy growth. Our
three largest revenue sources, property tax, sales tax, and transient occupancy tax (TOT), are
expected to total $99.7 million in FY 2014-15, comprising 78 percent of General Fund revenue.
Revenues from sales tax and TOT are highly sensitive to changes in the economic activity,
unlike property tax revenues, which tend to lag behind economic growth and remain relatively
stable over time. The biggest revenue source, property tax, is expected to grow by 3.2 percent
to $51.6 million, as assessed values continue to improve in residential real estate. The median
price for a single family residence in Cadsbad rose to a median $720,000, compared to
$655,000 for the same time period, last year. Compared to the first quarter of 2013, prices have
increased in all city zip codes except 92011, the southwest quadrant of Cadsbad. Sales
inventories, though better that a year ago, are still relatively tight, a factor that may continue to
sustain Cadsbad residential real estate prices. Economists also forecast increased interest
rates and a tightening in Federal Reserve monetary policy, factors that could slow price
appreciation In residential real estate.
Property and Sales Tax Revenues
60 1
50
(0 40
c
40
o 30
i 20
10
0
•Sales Tax
- Property Tax
a* cSi^ ^^"^ ^N'^ .W^^ K^>^ rf^ ^ ^
Fiscal Year
Property taxes tend to lag behind the rest of the economy, as the tax revenue for the upcoming
fiscal year is based on assessed values from January. Thus, the taxes to be received for Fiscal
Year 2014-15 are based on assessed values as of January 1, 2014.
Proposition 13, adopted in 1978, limits the annual increase in assessed values for property.
Under this proposition, assessed values (and the related property tax) can grow by no more
than two percent per year. The value upon which the tax is based is only increased to the full
market value upon the sale of the property. Thus, property taxes tend to grow slowly unless
there is a significant amount of housing activity. In past decade, we have seen robust growth in
property taxes due to new development, high turnover of existing homes, and double-digit
growth in housing prices.
B-2
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
SALES TAX BY CATEGORY
FOURTH QUARTER 2013
MISCELLANEOUS
O.S%
CONSTRUaiON
2.3%
Sales tax revenues generally move
in step with economic conditions
and have improved markedly over
the past two years. Comparing the
fourth quarter of calendar year
2013 to the previous year, sales tax
cash receipts in the state of
California increased by 8.7 percent,
although a portion of this (3
percent) is due to late processing
by the Board of Equalization.
Statewide, MuniServices expects
taxable sales to grow by
approximately 5 percent in 2014,
as state unemployment improves.
The city of Cadsbad realized an
increase of 7.1 percent in cash
receipts for the fourth quarter of 2013. New auto sales, which comprise approximately one-
quarter of city sales tax revenue, have exceeded pre-recession levels and hit an all-time high in
the last quarter of 2013. City sales tax revenues are expected to increase by approximately 2
percent in FY 2014-15, adding $31.7 million to the General Fund. New retail additions in
Cadsbad, such as La Costa Town Square, will add to the sales tax base and the city will
continue to benefit from recent additions, such as the LegoLand Hotel and Lowe's, which
opened in fall 2013.
Several years ago, the State of California implemented the "Triple Flip." The "Triple Flip" is
essentially a temporary swap of a % cent of the cities' sales taxes in return for property tax. It
was done in order to give the state a revenue source against which they could issue deficit
reduction bonds. The city's sales tax estimates continue to show this amount as sales tax, since
the amount is reflective of what the city would receive.
As can be seen in the chart above, the city's sales tax base is heavily weighted in the
transportation (predominantly new car sales) and retail sectors. These two sectors account for
two-thirds of taxable sales in Carlsbad. New car sales dropped precipitously during the recent
recession, falling from $6.7 million in the fourth quarter of 2007 to a low of $4.4 million in 2009.
In the fourth quarter of 2013, new car sales hit a high of $7.4 million. Retail sales have also
increased substantially as the recession has abated.
Sales tax estimates also include approximately $1 million in Proposition 172 funds, which are
earmarked for public safety service expenditures. Proposition 172 requires that the 'A cent
increase in California sales taxes be allocated to local agencies to fund public safety services.
Transient Occupancy Taxes
0> c o
18^
16 -
14 -
12 -
10 -
8 -
6 •
4
2
0
Is i 11 ii ii i ii il- U 1
^06 2009 2012
Fiscal Year
20158
B-3
The third highest General Fund
revenue source Is Transient
Occupancy Taxes (TOT, or hotel
taxes). TOT is forecast to increase
by 3 percent in FY 2014-15, from
approximately $16 million to $16.5
million. As seen In the
accompanying graph, TOT has
increased by over 40 percent since
FY 2010-11, as new hotels, such as
the LegoLand Hotel and the Hilton
Oceanfront Resort & Spa have
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
opened in the past years. Overall improvement in the national and state economies has also
bolstered tourism in the region, and the San Diego Tourism Authority expects demand for hotel
room to continue rebounding in 2014. Carisbad currently has over 4,000 hotel rooms and over
1,000 vacation rentals, which continue to benefit from increasing daily room rates and improving
occupancy rates.
Franchise Taxes
tn c o
0
I Other
Franchise
ISDG&E
Franchise
2006 2009 2012 2015e
Fiscal Year
One of the more volatile
General Fund revenues
is the Franchise Tax.
Franchise taxes are paid
by certain industries that
use the city right-of-way
to conduct their
business. The city
currently has franchise
agreements for cable TV
service, solid waste
services, cell sites, fiber
optic antenna systems
and gas and electric
services. The cable and solid waste franchises have been growing along with the growth in
population, changes in their rate structures, and the continued growth ofthe city's newest cable
franchises, AT&T and Time Warner. Overall, franchise tax revenues are projected to increase
by approximately 2 percent, with all segments sharing in the increase.
SDG&E pays franchise taxes for the use of the public land over which they transport gas and
electricity. The city also receives an "in-lieu" franchise tax based on the value of gas and
electricity transported on SDG&E lines, but purchased from another source. The "in-lieu" tax
captures the franchise taxes on gas and electricity that is transported using public lands but
which would not othenwise be included in the calculations for franchise taxes, due to
deregulation of the power industry. The majority of the "in-lieu" taxes received is attributable to
Cabrillo Power, the operator of the Encina power plant, and is based on the gas used in the
generation of electricity. The continued reduction in operations at the Encina power plant is
projected to negatively impact the "in-lieu" franchise tax paid by SDG&E, although revenues
from this source are expected to increase slightly in FY 2014-15 after a decrease experienced in
the current year (FY 2013-14).
Development-related revenues include planning, engineering and building permits, and fees
paid by developers to cover the cost of reviewing and monitoring development activities such as
plan checks and inspections. These revenues are difficult to predict, as many of the planning
and engineering activities occur months or years before any actual development.
During FY 2009-10, development related revenues began to turn around from historic lows
experienced in FY 2008-09. During FY 2010-11, development related revenues continued to
strengthen, especially on the non-residential side, with the permitting of the new Isis
Pharmaceuticals headquarters and the Hilton Beachfront Hotel. Development related revenues
have fluctuated in the past years with increases and decreases in residential and commercial
and industrial development. In FY 2012-13, revenues rose from $2.7 million to $3 million,
following a marked increase in commercial space permitted. This year, FY 2013-14,
development related revenues normalized to $2.1 million, as trends returned to normal levels.
In FY 2014-15, we expect a 20 percent increase in development related revenues, to
approximately $2.5 million, as decreases in residential permits are offset by stable commercial
development and an increase in permit activity for industrial space.
B-4
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
Business license taxes are closely tied to the health of the local economy, and are projected
to increase by 4 percent to an estimated $3.8 million in FY 2014-15. There are currently about
9,264 licensed businesses in Carisbad, with just over 2,474 of them home-based.
All other revenues include transfer taxes, interest earnings, ambulance fees, recreation fees,
and other charges and fees. The estimate for Fiscal Year 2014-15 totals $9.2 million, a
$807,000, or 9.6 percent, increase from the previous year.
Interdepartmental charges are generated through engineering services charged to capital
projects, reimbursed work from other funds and miscellaneous interdepartmental expenses
charged to funds outside the General Fund for services performed by departments within the
General Fund.
Transfer taxes are those taxes paid to the county upon the transfer of interests in real estate.
The tax is 55 cents per $500 of property value, and is split equally between the county and the
city. Carisbad expects to receive approximately $1.1 million in transfer taxes for FY 2014-15,
which is essentially unchanged from FY 2013-14. Although housing prices have increased, very
low inventories indicate a lack of sales activity. Sales activity is projected to remain relatively
low, as Fed action and an improving overall economy put upward pressure on mortgage rates.
Income from investments and property includes interest earnings, as well as rental income from
city-owned land and facilities. The city is expected to earn about $2.5 million in interest on its
General Fund investments for Fiscal Year 2014-15, as the yield on the city's portfolio is
expected to be approximately one percent and is not expected to substantially improve in the
coming fiscal year.
$ Millions General Fund Revenues
3.4%
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY2014e FY2015e
Overall, as reflected in the bar chart, General Fund revenues are expected to be up 3.4 percent
from FY 2013-14, as property tax, sales tax, and TOT continue to improve. Although the city
experienced revenue growth between 9 and 17 percent in the late 1990's, it was not
sustainable. Much of those increases were due to the opening of new hotels, restaurants, retail
centers, and new home development. As new development slows, it will be increasingly more
difficult to produce double-digit growth in revenues. An improving economy is certainly driving
B-5
2014-15 PREUMINARY OPERATING BUDGET OVERVIEW Exhibit 1
General Fund revenues higher, but revenue growth should remain in the 3 to 4 percent range in
the coming years.
The City has a General Fund reserve policy that sets a minimum reserve of 30 percent of the
General Fund Operating Expenditures. In addition, the policy sets a target reserve of 40
percent to 50 percent of General Fund Operating Expenditures. The minimum reserve would
provide approximately three to four months of operating expenditures for unforeseen
emergencies. At the end of FY 2012-13, the unassigned General Fund balance was
approximately $69.6 million. At the end of FY 2013-14, the reserve is projected to be
approximately $71.5 million, or 59 percent, of the FY 2013-14 Budget. The reserve amount is
consistent with Council Policy 74: General Fund Reserve Guidelines.
Other Funds
Revenues from Special Revenue funds are expected to total $11.2 million in FY 2014-15, a
$317,000, or 2.9 percent, increase from FY 2013-14. The types of programs supported within
Special Revenue funds are those funded by specific revenue streams such as:
• Grants (Rental Assistance-Section 8 and Community Development Block Grants)
• Special fees and assessments (Affordable Housing and Maintenance Assessment Districts)
• Donations (Library, Cultural Arts, Recreation and Senior Donations)
SPECIAL REVENUE FUNDS
2014-15 PROJECTED REVENUES
Donations and Grants
4%
All others
3%
Maintenance Districts
26%
CDBG, 6%
Rental Assistance
49%
Affordable Housing
12%
The most noteworthy changes in the Special Revenue funds occurred in the Affordable Housing
Trust Fund, the Community Development Block Fund and the Rental Assistance
Fund. Estimated revenues decreased $562,000, increased $420,000 and $501,000,
respectively, from FY 2013-14. During FY 2013-14, the city received approximately $1.6 million
in one-time affordable housing credits. In order to meet the inclusionary housing obligations for
certain areas of the city (e.g., the southeast and southwest quadrants), units related to
developments were made available as affordable housing credits for housing developers to
purchase. Due to the small size of certain projects and the difficulty in obtaining financing,
B-6
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
some developers/applicants have opted to purchase affordable housing credits instead of
constructing units.
Enterprise fund revenues for FY 2014-15 are projected at $71.8 million, an increase of $2.6
million, or 3.8 percent, over current year projections. The increase in revenues is primarily due
to the planned rate increases for Water and Wastewater funds, as well as revenue increases to
the city's golf course operations. Enterprise funds are similar to a business, in that rates are
charged to support the operations that supply the service. Carisbad Enterprise funds include
water and recycled water delivery, wastewater services, solid waste management, and
operation of a golf course.
The Water Enterprise Fund revenue is estimated at $48.5 million, an increase of $2.4 million, or
5.2 percent over the current year estimate. These revenues reflect $2.1 million in increased
sales revenue due to a proposed rate increase of 5.0 percent effective January 1, 2015 to pay
for the rising cost of potable water purchases. The proposed rate increases have been
approved by the Board of Directors of the Carisbad Municipal Water District. Anticipated
increases paid to the San Diego County Water Authority include an estimated 3.6 percent
increase to the wholesale purchase cost of water (from $1,103 to $1,143 per acre foot, effective
January 1, 2015), and an estimated 5 percent increase in the fixed charges for water purchases
(from $5.8 million to $6.1 million) for FY 2014-15. In addition to paying for the wholesale and
fixed water costs, the FY 2014-15 Operating Budget includes funding for replacement of
Carisbad's water infrastructure, ongoing meter replacements, and building sufficient operating
reserves.
Estimated revenues for Wastewater are $12 million; no change from the current year
estimate. The revenue reflects proposed rate increases to fund the ongoing cost of operations,
maintenance, and funding for replacement of infrastructure, as well as providing a sufficient
operating reserve. The proposed rate increase for January 1, 2015 is 2 percent and has been
approved by the City Council. Although rates are increasing, revenues are projected to remain
flat due to decreases in wastewater flows.
Estimated revenues for the Golf Course are $7.6 million, up 3.9 percent or $300,000 from the
current year estimate.
Internal Service funds show estimated revenues of $19.7 million for FY 2014-15, relatively flat
in total, from FY 2013-14 projections. This number is somewhat misleading, however, because
in FY 2013-14 there was a one-time transfer of $2 million to the Self Insured Benefits Fund and
a transfer to the Risk Management Fund of $750,000. In FY 2014-15 there are notable
increased revenues in the Worker's Compensation, Vehicle Maintenance and Replacement,
and Information Technology funds. Worker's Compensation claims and recommended reserves
have risen, as have Vehicle Maintenance and Replacement costs. The Information Technology
department has seen increases in contractual services and has incurred additional costs for
newly implemented technology projects.
Internal Service funds provide services within the City itself, and include programs such as the
self-insurance funds for Workers' Compensation and General Liability (Risk Management), as
well as Vehicle Maintenance and Replacement, and Information Technology. Departments pay
for services provided by these funds; therefore, the rates charged for the services are based on
the cost to provide the service. The goal of the Internal Service funds is to match their budgeted
expenses with charges to the departments, after allowing for a certain level of reserves within
the fund.
B-7 ^3
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
The Redevelopment Obligation Retirement Fund (RORF) revenues are budgeted at $2
million, or 22.4 percent over FY 2013-14. Although the Redevelopment has been dissolved, the
California Department of Finance has approved the repayment of the approximately $8.1 million
(plus accrued interest) loaned to both former redevelopment areas by the General Fund. Loan
payments of approximately $1 million per year will be made to the city, and 20 percent of this
repayment will be set aside for future affordable housing.
B-8
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
EXPENDITURES
The city's Preliminary Operating Budget for FY 2014-15 totals $227.1
million, which represents an increase of about $12.3 million, or 5.8
percent, as compared to the adopted FY 2013-14 Budget. The changes in
each of the city's programs will be discussed below.
Budqetarv Policies
The theme behind this year's budget development was for the city to continue to provide the
very best services to the community while finding operating efficiencies and reducing costs
wherever possible. The goal was to achieve a balanced budget for the coming fiscal year while
still maintaining the city's long-term financial health and ensuring that future costs can be met
without negatively impacting the services provided to the community. All known and ongoing
operating expenses were incorporated in the FY 2014-15 Preliminary Operating Budget, as
well as in the long-term financial forecast.
Responsible management of the city's resources includes maintaining a focus on a sustainable
future by ensuring the city remains in good financial health, as today's decisions will impact
future spending levels. Although the city is entering the new fiscal year in a solid financial
position, the city will pursue allocating resources in a manner that provides the best services for
the people of Carisbad. The following policies for FY 2014-15 were established in line with
conservative estimates for future revenue growth:
• Continue to provide excellent services to our residents.
• Increase in the number of staff positions were allowed in instances where community
priorities would be served.
• Modest growth (2 percent) was allowed for maintenance and operations in order to
allow departments to meet escalating costs.
• All departments exercised prudence in budgeting and considered cost containment
measures and set discretionary budgets at minimum levels.
The city uses an "Expenditure Control Budget" (ECB) process in budgeting, where each
department is given a block appropriation containing sufficient funds to provide the current level
of services for the upcoming year. For FY 2014-15, departments were allowed a 2 percent
increase, if needed, for their expenditures for maintenance and operations (M&O). As a result
ofthe economic recession, block budgets were reduced in both FY 2008-09 and FY 2009-10 in
order to align expenses with falling revenues. In order to gain further operating efficiencies, the
city's organizational structure was realigned in FY 2010-11. Since the beginning of the
recession, the city has eliminated 47 full-time equivalent (FTE) positions in order to contain
costs. In the FY 2014-15 budget, there is a net increase of 3 full-time equivalent positions. No
additional appropriations are expected during the fiscal year, except in the case of significant
unanticipated events. As in past years, amounts that are unspent at the end of the fiscal year
will be carried forward to the next year, or will increase the city's reserves. At the end of FY
2013-14, the amounts carried fonward by each department will be capped at no more than 10
percent of the previous year's Adopted Budget.
B-9 96
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
Budgeted Expenditures
Through the application of these guidelines and policies, the FY 2014-15 Preliminary Operating
Budget of $227.1 million was developed.
Position Changes
A net increase of 3.0 full-time positions is reflected in the FY 2014-15 Preliminary Operating
Budget, as compared to the FY 2013-14 Adopted Budget. These position additions resulted in
an approximate citywide personnel increase of $278,400 for the coming year.
The FY 2014-15 Preliminary Operating Budget includes the elimination of the following 8 full-
time positions:
1.0 Administrative Secretary
1.0 Engineering Technician
1.0 Office Specialist II
4.0 Parks Maintenance Worker II (mid-year)
1.0 Tree Trimmer Lead Worker (mid-year)
The FY 2014-15 Preliminary Operating Budget includes the addition ofthe following 11 full-time
positions:
1.0 Business Systems Specialist
1.0 Code Compliance Specialist II
1.0 Facilities Manager (limited term to permanent)
1.0 Fire Marshall
1.0 Housing Assistant
1.0 Management Analyst
1.0 Office Specialist II
1.0 Secretary
1.0 Senior Applications Analyst (mid-year)
1.0 Training Coordinator
1.0 Traffic Systems Operator
The net increase in hourly staff totals 7.19 FTE. This increase is due to the following:
Additions: Eliminations:
5.58 Alga Norte Park 1.75 Office Assistants
1.00 Building Internship Program 0.30 Technical Assistant
0.50 Community Outreach & Engagement
2.16 Property & Environmental Mgmt.
These changes result In a city workforce of 670.75 full and three-quarter time employees, and
157.77 houriy, full-time equivalent positions.
New Facilities
The city has a number of major capital projects scheduled to be built over the next five years.
As the city completes these projects, the costs of maintaining and operating the facilities,
including additional personnel if necessary, are added to departmental operating budgets.
There are no new facilities expected to open in FY 2014-15.
B-10
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
Budget bv Fund Type
The table below shows the changes in the Preliminary Operating Budget for FY 2014-15, as
compared to the Adopted Budget for FY 2013-14.
BUDGET EXPENDITURE SUMMARY
BY FUND TYPE
(In Millions)
FUND
BUDGET
2013-14
BUDGET
2014-15
$
CHANGE
%
CHANGE
GENERAL FUND
SPECIAL REVENUE
ENTERPRISE
INTERNAL SERVICE
REDEV. OBLIG. RETIREMENT
$ 119.7
10.6
65.9
17.2
1.3
$ 124.5
10.6
68.8
21.9
1.3
$ 4.8
2.9
4.7
4.0%
-0.2%
4.4%
27.1%
1.9%
TOTAL $ 214.7 $ 227.1 $ 12.3 5.8%
The General Fund contains most of the discretionary revenues that support basic core city
services. However, this should not diminish the importance of the other operating funds, as
they also contribute to the array of services available within Carisbad. The remainder of this
section will provide more information about the budgeted expenditures by fund and program.
GENERAL FUND SUMMARY
BY EXPENDITURE TYPE
(In Millions)
BUDGET
2013-14
BUDGET
2014-15
$
CHANGE
%
CHANGE
PERSONNEL
MAINTENANCE & OPERATIONS
CAPITAL OUTLAY
TRANSFERS
$ 74.3
31.6
13.8
$ 78.3
36.0
0.1
10.1
$ 4.0
4.4
0.1
(3.7)
5.4%
13.9%
0.0%
-26.6%
TOTAL $ 119.7 $ 124.5 $ 4.8 4.0%
General Fund
The total Preliminary Operating Budget for the General Fund for FY 2014-15 is $124.5 million,
which is four percent greater than the previous year's Adopted Budget of $119.7 million. The
total increase is attributable to a $4 million, or 5.4 percent increase in Personnel, a $4.4 million
or 13.9% increase in Maintenance and Operations costs, and a $3.7 million, or 26.6 percent,
overall decrease in transfers out of the General Fund to other city funds, as can be seen in the
table above. These changes are discussed in more detail below.
Personnel costs make up approximately 62 percent of the General Fund budget so any
changes in these costs can have a significant effect on the total budget. The total personnel
budget for FY 2014-15 is $78.3 million, which is $4 million, or 5.4 percent more than the
previous year's total personnel budget of $74.3 million.
B-11 ^7
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
GENERAL FUND
PERSONNEL COSTS
(In Millions)
BUDGET
2013-14
BUDGET
2014-15
$
CHANGE
%
CHANGE
SALARIES $ 52.0 $ 54.5 $ 2.5 4.8%
RETIREMENT 13.0 14.3 1.3 9.8%
HEALTH INSURANCE 6.8 6.8 -0.1%
WORKERS COMP 1.4 1.5 0.1 10.0%
OTHER PERSONNEL 1.1 1.2 0.1 8.6%
TOTAL $ 74.3 $ 78.3 $ 4.0 5.4%
The table above shows the breakdown of personnel costs for the General Fund. Salaries
include full and part-time staff costs and are expected to increase in FY 2014-15 by $2.5
million, or 4.8 percent. The increase is mainly due to previously negotiated wage increases
scheduled to occur in FY 2014-15, as well as the net addition of 3 full-time staff and 7.19 part-
time staff; the part-time staff are primarily for Alga Norte Park operations. Alga Norte Park
opened to the public eariier this year, and the FY 2013-14 operating budget only included
partial funding and staffing for operations and maintenance ofthe park.
Retirement rates, as projected by CalPERS, will increase in FY 2014-15 by about 1 percent of
payroll for General and Management employees, representing a 4.4 percent increase, and by
about 1.4 percent of salary for Safety employees, representing a 4.2 percent increase. These
rate increases for the city will result In an increase of approximately $1.2 million for the General
Fund in FY 2014-15. Larger increases, approved by CalPERS, will go into effect in FY 2015-
16.
Health insurance rates are remained relatively flat, and Worker's Compensation expense is
projected to increase slightly. Miscellaneous other personnel costs, such as bi-lingual pay, are
also projected to increase slightly for FY 2014-15.
Maintenance & Operations costs (or M&O) represent about 29 percent of the total General
Fund budget, and include the budgets for all program expenses other than personnel, capital
outlay and transfers. Overall, total M&O costs are projected at $36 million, an increase of
about $4.4 million, or 13.9 percent, for FY 2014-15 as compared to FY 2013-14. Maintenance
and Operations costs are discussed more fully by program later in the report.
In addition to the 2 percent M&O increase authorized for FY 2014-15, budgets for utility costs
were adjusted to keep up with the rising costs seen in the past few years, and anticipated in FY
2014-15. The FY 2014-15 includes additional funding of $656,000 for these increases.
Departments with part-time hourly employees were also given a 3.1 percent, or a $140,000
increase, based on an external salary budget survey.
Capital Outlay includes budgeted equipment purchases over $1,000. Capital outlay purchases
of $131,000 are budgeted in the General Fund for FY 2014-15.
Transfers are amounts anticipated to be transferred from the General Fund to another city
fund. The transfers included in this year's proposed budget are to the following funds:
B-12 9S
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
. $8,302,000 million to the Infrastructure Replacement Fund for major maintenance and
replacement of city infrastructure. This represents 6.5 percent of the General Fund
Revenues, the same as the percentage transfer for FY 2013-14.
. $251,962 to the Storm Water Program for reimbursement for the General Fund portion
of Storm Water expenses.
. $539,000 to the Median Maintenance and Street Tree Maintenance Special Revenue
Funds to cover cash shortfalls, as annual assessments collected from property owners
do not cover annual operating expenditures.
• $1,031,240 to the city's municipal golf course for debt service.
Advances are amounts anticipated to be transferred from the General Fund to another city
funds and are expected to be repaid to the General Fund in future years. No General Fund
advances are included in this year's Preliminary Operating Budget.
Another way of looking at the General Fund budget is by program. The chart on the following
page compares the total FY 2014-15 Budget to the amounts adopted in the previous year. A
brief description of each department and its services and a summary of significant department
budget changes in the FY 2014-15 Preliminary Operating Budget, are noted below the chart.
GENERAL FUND EXPENDITURES
BY DEPARTMENT
(In Millions)
BUDGET BUDGET $ %
DEPARTMENT 2013-14 2014-15 CHANGE CHANGE
POLICY/LEADERSHIP $ 4.0 $ 5.6 $ 1.6 39.4%
COMMUNITY & ECONOMIC DEV 6.8 8.2 1.3 19.3%
FINANCE 3.6 3.7 0.2 4.4%
FIRE 17.8 18.9 1.2 6.5%
HOUSING & NEIGHBORHOOD SRVCS 0.6 0.7 0.1 20.5%
HUMAN RESOURCES 2.4 2.9 0.5 19.9%
LIBRARY & CULTURAL ARTS 10.4 11.2 0.8 8.0%
PARKS AND RECREATION 13.2 14.7 1.5 11.4%
POLICE 28.7 29.1 0.3 1.2%
PROPERTY & ENVIRONMENTAL MGT 5.6 6.1 0.5 9.6%
RECORDS MANAGEMENTS 0.8 0.3 (0.5) -62.3%
STORM DRAIN ENGINEERING 0.3 0.3 --0.3%
TRANSPORTATION 8.7 9.3 0.6 6.7%
NON-DEPARTMENTAL 16.7 13.5 (3.3) -19.5%
TOTAL $ 119.7 $ 124.5 $ 4.8 4.0%
The Policy & Leadership Group consists of all elected officials, the City Manager's
Office, the City Attorney's Office, and communications and records management
functions. The $1.6 million, or 39.4 percent increase for FY 2014-15 is due to the
following: $247,000 was transferred from Parks & Recreation and Library and Cultural
Arts to the Communications budget in order to consolidate the work program in one
B-13
2014-15 PREUMINARY OPERATING BUDGET OVERVIEW Exhibit 1
area; personnel and operating expenses were transferred to the City Clerk's budget
from the Records Management budget ($450,000), and the City Manager budget
reflects about $300,000 in increased personnel costs as well as an increase for one-
time professional services related to the Higher Education Goal.
. The Community and Economic Development Department includes economic
development, planning, development services, building inspection, land use
engineering. The increase of about $1.3 million, or 19.3 percent. Is mainly due to the
addition of one-time as well as on-going funding to implement programs such as the
North County Brand, Digital Records Management, and a Building Inspector Intern
Program as well as the addition of a Fire Marshall position. The budget for
development plan check services increased $530,000; these expenditures are offset by
charges for services.
. The Housing and Neighborhood Services budget has remained relatively flat from
the prior fiscal year.
. The Finance Department provides the services of accounting, financial reporting,
capital and operating budgeting, payroll, billing and collections, citywide mail
processing, purchasing and receiving, fiscal oversight, and long-term financial planning
for the city. The increase of about $156,000, or 4.4 percent, is mainly due to increases
in internal services, and personnel.
. The Carisbad Fire Department provides emergency operations, emergency
preparedness, and fire prevention services to safeguard lives, property and the
environment in the City of Carisbad. The FY 2014-15 operating budget reflects a 6.5
percent, or $1,200,000 increase. In addition to negotiated salary and benefits and
internal service charge increases, funding is included for the purchase of 3 cardiac
monitors, and to pay for rising contractual payments for outside services.
. The Human Resources Department supports the city with staffing and recruitment,
employee development, performance management, and compensation and labor
relations services. The increase of $477,000, or 19.9 percent, is primarily due to
increased contracted recruitment services and a net 1.25 FTE increase for a
Management Analyst and a Training Coordinator position.
. The Library and Cultural Arts Department provides staffing and a wide variety of
programming for two library branches, a library learning center, and a cultural arts
office. The department's budget is projected to increase by $834,000, or 8 percent,
from FY 2013-14 to FY 2014-15. Increased funding includes $35,000 for a Public Arts
Master Plan and a $25,000 increase to the Community Arts Grants program.
Remaining increases are for intemal services, personnel costs and utility costs.
• The Parks and Recreation Department plans, staffs HM^H^HaHHBHH
and maintains the city's parks and recreational facilities, HUSM^I^HP^^^^?
provides an assortment of recreational programs for all ^^^^jy^^^^^^^
ages, maintains landscaping at facilities throughout the IHHHHHII^H^^^^H
city, and manages the city's open space areas. Alga pBSHR^^^^B^HH
Norte Park opened eariier this year, and FY 2014-15 ^'^^^^jj^^r'^'VBEK
includes funding for operations and maintenance of this M«BHHH||^^^'^^V
facility. The FY 2014-15 budget is $1.5 million, or
11.4% greater than the FY 2013-14 budget. Alga Norte HI^H^BHHHBi
Park operations represents about $870,000 of this
B-14 30
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
increase, and includes additional funding for 5.58 FTE part-time staff for concessions
and class instructors. In addition, increases are included for internal services, rising
utility costs, and food and supplies for the concession sales. Park maintenance costs
have increased and include and additional $175,000 for internal services, $200,000 for
increased utilities, and a net $400,000 increase in contractual services. Four
maintenance worker positions and one tree trimmer were eliminated during the year,
providing some of the funding for the increased contractual services.
• The Carisbad Police Department provides high quality public safety services to the
community by enforcing laws and ordinances, preserving the peace, and providing for
the protection of life and property. Overall, the department's costs are increasing by
$331,000, ora modest 1.2 percent, for FY2014-15, as compared to FY2013-14.
. The Property and Environmental Management Department manages all city-owned
property, including real estate, buildings and vehicles. The department also manages
the city's environmental programs, which include storm water, habitat and other
environmental maintenance and monitoring programs. The increase of $534,000, or
9.6 percent, from the prior year's budget is primarily due to the replacement of furniture
and the addition of 2.16 part-time FTE positions to assist with capital construction
projects (these expenses will be reimbursed by the capital funds) and real estate
projects.
. The Utilities Department in the General Fund consists of Storm Drain Engineering
activities. No change is expected for FY 2014-15 as compared to the FY 2013-14
budget appropriation.
. The Transportation Department manages all streets, traffic and other city-wide
transportation services, including city traffic engineering, traffic signal monitoring and
maintenance, and maintenance of all city streets and roadways. The FY 14-15 budget
reflects an increase of $581,000, a 6.7 percent increase over FY 2013-14. These
increases are due to increased development inspection services, rising utility costs,
internal services, and personnel increases.
. Non-departmental expenses include the transfers previously discussed, the Council
Contingency account, and administrative and other expenses not associated with any
one department. The non-departmental budget is expected to decrease by $3.2 million,
or 19.5 percent, in FY 2014-15. The decrease is due to one-time transfers made in FY
2013-14 to the city's Self Insured Benefits Fund, and the General Capital Construction
Fund for the Village enhancement projects.
The Council Contingency is a budgeted amount that is available to the City Council to
address unanticipated emergencies or unforeseen program needs during the fiscal
year. Prior to the economic recession, the Council Contingency budget provided
between 2 and 2.5 percent of the General Fund Operating Budget for these unforeseen
costs. For FY 2014-15, the Contingency is budgeted $1.5 million, with no change when
compared to the prior year.
B-15 31
2014-15 PREUMINARY OPERATING BUDGET OVERVIEW Exhibit 1
History of General Fund Expenditures
$ Millions 4.0%
125.0
110.0
105.0
100.0
95.0
FY2008 FtTOOS FYMIO FY2011 FYMU FY2013 FY2014AD FYMlSe
$118.7m $111.9m $111.2m $119.7m $124.5m
As reflected In the chart above, the city's expenditures were reduced significantly with the City
Council's revised budget in FY 2008-09, reflecting a 5.7 percent decrease from the FY 2007-08
Adopted Budget. FY 2009-10 showed a 2.9 percent increase, followed by another large
reduction of 6.3 percent in FY 2010-11. FY 2012-13 General Fund expenditures decreased by
$1.4 million, or 1.2 percent. In FY 2014-15 estimated expenditures are expected to increase
4.0 percent to $124.5 million, when compared to the FY 2013-14 adopted budget.
Changes in Other Funds
Special Revenue funds, at $10.6 million, are relatively flat when compared to FY 2013-14.
While there are several Special Revenue funds with fluctuations from year to year, the most
significant decrease is in funding in CDBG grant funding.
Enterprise funds total $68.8 million, which is an increase of $2.9 million, or 4.4 percent, over
the FY 2013-14 Adopted Budget. The most significant change in Water Operations is due to
the estimated increase in the cost of water purchased from the San Diego County Water
Authority (5 percent increase in fixed costs and 3.6 percent increase in the variable costs). The
Operating Budget also includes funding for depreciation replacement transfers related to
growth and aging ofthe water infrastructure system.
Wastewater operations are projected to increase 10.7 percent, or $1.2 million, ofthe total $2.9
million overall increase in Enterprise funds. This increase in the operating budget is primarily
due an increase in the depreciation replacement transfer, to reflect an adjustment made to the
city's share of the Encina treatment plant assets. Other increases were seen in utility costs,
and parts and supplies related to infrastructure asset maintenance.
Golf Course operations are expected to remain relatively flat for FY 2014-15.
B-16
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
The Internal Service funds total $21.9 million, an increase of $4.7 million, or 27 percent, from
the prior year. The Internal Service funds are self-supporting through user charges. Changes
occurred in a number of these funds, including the following:
. The General Liability budget shows an increase of approximately $100,000, or 6.3
percent, based on higher claims projected for the fund, as compared to the prior fiscal
years.
. The Self Insured Benefits budget shows an increase of approximately $2 million on
the expenditure side; funding was previously transferred in to this fund to provide future
stabilization of retirement rates.
. The Vehicle Replacement budget has increased almost $660,000, or 51.6%.
Replacements can vary significantly from year to year, depending on the useful life,
cost, and replacement timing of individual fleet assets. A list of the requested
replacement vehicles can be found at the end of this document.
. Vehicle Maintenance costs have increased almost $400,000, or 13.7% due to
increases in parts, and gas and oil, and other maintenance related costs.
• The Information Technology budget shows an increase in the department's budget of
approximately $1.2 million, or 15 percent, from the prior fiscal year. This department
has seen increases in software maintenance and contractual services of both existing
and new technology projects. The cost of staffing has also increased as the
department has seen a greater need for some key professional positions which come at
a higher cost due based on market demand for those skills.
The budgets for the Redevelopment Obligation Retirement Funds (RORF) budgets have
remained flat, from the Redevelopment Agency Fund budgets shown in the previous year. The
ROPS identifies financial commitments of the former RDA, including $250,000 in administrative
costs, which will be paid from semi-annual tax increment revenue received by the Successor
Agency and annual debt service requirements. Every six months a new ROPS must be
prepared and approved by the Oversight Board, the County of San Diego and the State of
California in order to receive additional tax increment.
SUMMARY
This Preliminary Operating Budget for FY 2014-15 provides a balanced budget for the coming
fiscal year while continuing with a long-term plan to sustain a balanced budget in future years.
Significant ongoing operating expenses were identified and incorporated in the FY 2014-15 to
ensure the budget reflects the ongoing financial obligations of the city. The Carisbad economy
is continuing to improve, as a strong economic base is aided by the addition of hotel, retail and
commercial projects. Major revenue sources are improving in the city, with continued gains
seen In property tax, sales tax, and hotel tax revenues.
Carisbad still faces economic challenges from a fluctuating economy, continued increases in
utility and water rates, and concerns over the impact that budget decisions at the state and
federal levels could have on the city's financial situation. To meet these challenges, the city
has initiated a program to evaluate all city operations looking for opportunities to reduce costs
through efficiencies, shared services or contracting out services In some areas when that
makes sense. The city has already seen results from these efforts. As costs for utilities,
insurance, and supplies have increased, departments have been able to reduce costs in other
areas to maintain a balanced budget without impacting services provided to the community.
B-17 33
2014-15 PRELIMINARY OPERATING BUDGET OVERVIEW Exhibit 1
The City of Carisbad is entering the new fiscal year in a solid financial position and focused on
the future. Careful planning and responsible management have allowed the city to not only
maintain core services, but to also move ahead on community projects and other investments
that contribute to an excellent quality of life in our community. Promoting a strong local
economy and bringing more jobs to the city is a top priority. Due to continued fiscally
conservative practices, the city is in an excellent position to take advantage of new economic
opportunities that will allow our community to thrive now and for many years in the future.
B-18 3y
CITY OF CARLSBAD
OPERATING FUNDS
PROJECTED FUND BALANCES
Exhibit 2
UNRESERVED PROJECTED
BALANCE PROJECTED PROJECTED BALANCE
JULY 1,2013 REVENUES EXPENDITURES JUNE 30, 2014
$69,578,115 * $123,043,000 $123,837,030 $68,784,085 •
69,678,115 123,043,000 123,837,030 68,784.085
13.951,523 1,927,500 493,297 15,386.726
1,249,607 104,000 115,000 1.238.607
124,274 148,000 131,377 140.897
1,032,919 12,000 10,000 1,034,919
1,106 230,000 229,810 1,296
172,206 23,000 73,000 122,206
257,786 3.000 0 260,766
176,271 149,000 150,000 175,271
1,688,103 410,000 254,000 1,844,103
767,440 356,000 299,000 824,440
167,734 716,400 800,000 84.134
368,667 0 42,200 316,367
519,023 103,000 140,323 461,700
(49,297) 93,000 172,000 (128,297)
236,264 33,600 6,000 263,764
542,286 5,024,000 6,001,644 (436,358)
314,568 27,500 20,000 322.068
1,239,594 890,000 774,500 1,355.094
17,320 657,200 625,000 49.620
22,767,294 10,907,100 10.337,151 23,337,243
4,566,146 37,876,000 36,150,428 6.291,718
6,011,420 8.262,000 10,938,812 3,334,608
901,253 12,100,000 11,796,876 1,204,377
10,478,964 3,593,000 2,870,363 11.201.601
185,360 7,344,000 7,396,076 133,284
22,143,143 69,176,000 69,162,666 22,165,668
(203,751) 2,768,000 3,904,882 (1,340,633)
303,172 2,737,000 1,375,000 1,665,172
1,762,272 2,864,000 709,222 3,917.060
511,262 2,835,000 2,977,813 368.449
16,304.286 1,430,000 3,038,405 14.695,881
5,215,017 7,062,000 7.200,000 6,067,017
23,892,258 19,686,000 19,206,322 24,372,936
892,122 1,649,000 1.191,370 1,349,762
: 892,122 1,649,000 1,191,370 1,349,762
IGENERALFUND
TOTAL GENERAL FUND
SPECIAL REVENUE
AFFORDABLE HOUSING
BUENA VISTA CHANNEL MAINTENANCE
CITIZEN'S OPTION FOR PUBLIC SAFETY
COMMUNITY ACTIVITY GRANTS
COMMUNITY DEVELOPMENT BLOCK GRANT
CULTURAL ARTS DONATIONS
LIBRARY AND ARTS ENDOWMENT FUND
LIBRARY GIFTS/BEQUESTS
LIGHTING AND LANDSCAPING DISTRICT NO 2
LOCAL CABLE INFRASTRUCTURE FUND
MEDIAN MAINTENANCE
PARKING IN LIEU
POLICE ASSET FORFEITURE
POLICE GRANTS
RECREATION DONATIONS
RENTAL ASSISTANCE - SECTION 8
SENIOR DONATIONS
STREET LIGHTING
STREET TREE MAINTENANCE
TOTAL SPECIAL REVENUE
ENTERPRISE
WATER OPERATIONS
RECYCLED WATER OPERATIONS
WASTEWATER OPERATIONS
SOLID WASTE MANAGEMENT
GOLF COURSE
TOTAL ENTERPRISE
INTERNAL SERVICE
WORKERS' COMPENSATION
RISK MANAGEMENT
SELF-INSURED BENEFITS
VEHICLE MAINTENANCE
VEHICLE REPLACEMENT
INFORMATION TECHNOLOGY
TOTAL INTERNAL SERVICE
I REDEVELOPMENT OBLIGATION RETIREMENT FUNDS
VILLAGE RDA OBLIGATION RETIREMENT FUND
TOTAL REDEVELOPMENT OBUGATION RETIREMENT FUNDS
ITOTAL OPERATING FUNDS $224,460,100 $223,723,428 $140,009,604 j
FOR THE GENERAL FUND ONLY THIS REPRESENTS UNASSIGNED FUND BALANCE,
B-19 3^
CITY OF CARLSBAD
OPERATING FUNDS
PROJECTED FUND BALANCES
FUND
PROJECTED PROJECTED
BALANCE ESTIMATED ADOPTED BALANCE
JULY 1,2014 REVENUES BUDGET JUNE 30, 2016
$68,784,086 • $127,264,000 $124,502,162 $71,546,923 '
68,784,085 127.264,000 124.602.162 71,545,923
15,385,726 1,365,000 637,380 16,213,348
1,238,607 112,000 106,276 1,244,332
140,897 125,000 142,368 123,529
1,034,919 10,000 14,000 1,030,919
1,296 650,000 94,639 666,657
122,206 33,000 74,600 80,706
260,786 2,000 4,000 268,786
175,271 130,000 50,376 254,896
1,844,103 564,000 251.476 2,146,627
824,440 367,000 622.138 669,302
64.134 844,000 843,833 84,301
316.367 0 44,000 272.367
481.700 55,000 181,140 366.660
(128,297) 0 0 (128.297)
263,764 38,000 80,500 221.264
(436.368) 5,525,000 6.249,055 (1.169,413)
322.068 26,000 36,600 310,468
1.366,094 872,000 860,276 1,366,818
49,520 517,000 533,345 33,176
23,337,243 11,224,000 10.625,900 23,936,343
6,291,718 39,911,920 37,828,272 8,375,366
3,334,608 8,633,475 7.576,742 4,392,341
1.204,377 12,103,119 12,382.263 925,233
11,201,601 3,618,662 3.513.918 11,206,345
133,284 7,626,796 7,477,931 282,148
22,165,588 71,793,971 68,778,126 26,181,433
(1,340,633) 3,701,230 2,026,466 334,131
1,665,172 1.951,490 1,809,248 1,807,414
3,917,050 901,660 3,664,614 1,264,096
368,449 3,268,711 3,269,004 368,166
14,695,681 1,680,625 1,962,600 14,424,006
6.067,017 8.202.753 9.308,566 3,961,205
24,372,936 19,706,469 21,920,397 22,169,008
1,349,762 2,017,828 1.316.279 2,052,301
1,349,752 2,017.828 1,315.279 2,062,301
[GENERAL FUND
TOTAL GENERAL FUND
SPECIAL REVENUE
INTERNAL SERVICE
WORKERS' COMPENSATION
RISK MANAGEMENT
SELF-INSURED BENEFITS
VEHICLE MAINTENANCE
VEHICLE REPLACEMENT
INFORMATION TECHNOLOGY
TOTAL INTERNAL SERVICE
AFFORDABLE HOUSING
BUENA VISTA CHANNEL MAINTENANCE
CITIZEN'S OPTION FOR PUBLIC SAFETY
COMMUNITY ACTIVITY GRANTS
COMMUNITY DEVELOPMENT BLOCK GRANT
CULTURAL ARTS DONATIONS
LIBRARY AND ARTS ENDOWMENT FUND
LIBRARY GIFTS/BEQUESTS
LIGHTING AND LANDSCAPING DISTRICT NO, 2
LOCAL CABLE INFRASTRUCTURE FUND
MEDIAN MAINTENANCE
PARKING IN LIEU
POLICE ASSET FORFEITURE
POLICE GRANTS
RECREATION DONATIONS
RENTAL ASSISTANCE - SECTION 8
SENIOR DONATIONS
STREET LIGHTING
STREET TREE MAINTENANCE
TOTAL SPECIAL REVENUE
I ENTERPRISE
WATER OPERATIONS
RECYCLED WATER OPERATIONS
WASTEWATER OPERATIONS
SOLID WASTE MANAGEMENT
GOLF COURSE
TOTAL ENTERPRISE
I REDEVELOPMENT OBLIGATION RETIREMENT FUNDS
VILLAGE RDA OBLIGATION RETIREMENT FUND
TOTAL REDEVELOPMENT OBLIGATION RETIREMENT FUNDS
TOTAL OPERATING FUNDS $140,009,604 $232,006,268 $144,874,0081
FOR THE GENERAL FUND ONLY THIS REPRESENTS UNDESIGNATED, UNRESERVED FUND BALANCE
B-20 3ip
CITY OF CARLSBAD
OPERATING FUNDS
REVENUE ESTIMATES
Exhibit 3/
REVENUE SOURCE
ACTUAL
REVENUE
2012-13
PROJECTED
REVENUE
2013-14
ESTIMATED
REVENUE
2014-15
CHANGE AS %
OF FY 13-14
PROJECTED
DIFFERENCE
2013-14 TO
2014-16
GENERAL FUND
TAXES
PROPERTY TAX
SALES TAX
TRANSIENT TAX
FRANCHISE TAX
BUSINESS LICENSE TAX
TRANSFER TAX
TOTAL TAXES
INTERGOVERNMENTAL
VEHICLE UCENSE FEES
HOMEOWNERS EXEMPTION
OTHER INTERGOVERNMENTAL
TOTAL INTERGOVERNMENTAL
LICENSES AND PERMITS
BUILDING PERMITS
OTHER LICENSES & PERMITS
TOTAL LICENSES & PERMITS
CHARGES FOR SERVICES
PLANNING FEES
BUILDING DEPT FEES
ENGINEERING FEES
AMBULANCE FEES
RECREATION FEES
OTHER CHARGES OR FEES
TOTAL CHARGES FOR SERVICES
FINES AND FORFEITURES
INCOME FROM INVESTMENTS
AND PROPERTY-
INTERDEPARTMENTAL CHARGES
OTHER REVENUE SOURCES
TOTAL GENERAL FUND
$61,232,218
29.301.079
14.702.411
6.117.586
3.833.584
1,058,343
105,245,221
56,196
362.631
1.106.325
1,524.153
869.367
1,147,006
2,016,363
567,439
747,286
768.102
2.368.600
1.580.386
670.379
6.702,192
1,354,405
$123,390,740
$49,968,000
31,107,000
15,971,000
4,885,000
3,677,000
1.097,000
106,706,000
46,000
366,000
618,000
1,019,000
736.000
723.000
147.000
553.000
627.000
2.260,000
2,114,000
509,000
6,210,000
680.000
2,388.000
3.718.000
$123,043,000
$51,680,000
31,674.000
16,450,000
4,990,000
3,824,000
1,080,000
109,598,000
0
357,000
618,000
975,000
879,000
866.000
1.745.000
176.000
662.000
760.000
2.326,000
2,703,000
520,000
7,137,000
865.000
32%
18%
30%
2.2%
4.0%
-16%
2 7%
-100 0%
0,6%
0.0%
-4.3%
19.6%
19.8%
19 7%
19.7%
19.6%
2 9%
27 9%
2.2%
14 9%
0.0%
00%
3.4%
$1,612,000
567,000
479.000
106.000
147,000
(17,000)
2,893,000
(46,000)
2,000
0
(44.000)
144.000
143,000
287,000
29,000
109,000
123,000
66,000
689.000
11.000
927,000
• INTEREST IS CALCULATED ON AN AMORTIZED COST BASIS
B-21
CITY OF CARLSBAD
OPERATING FUNDS
REVENUE ESTIMATES
REVENUE SOURCE
ACTUAL
REVENUE
2012-13
PROJECTED
REVENUE
2013-14
ESTIMATED
REVENUE
2014-15
CHANGE AS %
OF FY 13-14
PROJECTED
DIFFERENCE
2013-14 TO
2014-15
I SPECIAL REVENUE FUNDS
AFFORDABLE HOUSING
AFFORDABLE HOUSING FEES
FEDERAL GRANT
PROPERTY TAX
INTEREST
OTHER
TOTAL AFFORDABLE HOUSING
BUENA VISTA CHANNEL MAINTENANCE
BUENA VISTA FEES
INTEREST
TOTAL BUENA VISTA CHANNEL MAINTENANCE
CITIZEN'S OPTION FOR PUBLIC SAFETY
STATE FUNDING (AB3229)
TOTAL CITIZENS OPTION FOR PUBLIC SAFETY
COMMUNITY ACTIVITY GRANTS
INTEREST
TOTAL COMMUNITY ACTIVITY GRANTS
COMMUNITY DEVELOPMENT BLOCK GRANT
FEDERAL GRANT
INTEREST
OTHER
TOTAL COMMUNITY DEVELOPMENT BLOCK GRANT
CULTURAL ARTS DONATIONS
DONATIONS
INTEREST
OTHER
TOTAL CULTURAL ARTS DONATIONS
LIBRARY AND ARTS ENDOWMENT FUND
INTEREST
TOTAL LIBRARY AND ARTS ENDOWMENT FUND
LIBRARY GIFTS/BEQUESTS
GIFTS/BEQUESTS
INTEREST
TOTAL LIBRARY GIFTS/BEQUESTS
LIGHTING AND LANDSCAPING DISTRICT NO, *2
LLD #2 FEES
INTEREST
OTHER
TOTAL LIGHTING AND LANDSCAPING DIST, NO #2
LOCAL CABLE INFRASTRUCTURE FUND
CABLE FEES
INTEREST
TOTAL LOCAL CABLE INFRASTRUCTURE FUND
MEDIAN MAINTENANCE
MEDIAN MAINTENANCE FEES
INTEREST
OTHER
TOTAL MEDIAN MAINTENANCE
PARKING IN LIEU IN LIEU FEES
INTEREST
TOTAL PARKING IN LIEU
POLICE ASSET FORFEITURE
ASSET FORFEITURES
INTEREST
TOTAL POLICE ASSET FORFEITURE
POLICE GRANTS
FEDERAL GRANT
TOTAL POLICE GRANTS
$1,120,220
831.073
454
148.609
1,091,830
3,192,186
85,539
1.940
178,583
178,583
1,164,716
433
254,016
1,419.166
56,350
155
57,106
127,381
654
467,971
1,994
6,400
475,365
368,971
1,264
357,401
73
383,761
741,235
0
756
756
106,629
180
665,193
$1,676,000
50,000
0
165.500
46,000
1,927,500
92,000
12,000
12,000
230,000
0
0
230,000
22,000
1,000
0
23,000
3,000
147,000
2,000
390,000
14,500
5,600
410,000
348,000
8,000
369,000
0
367,400
716,400
104,000
6,000
109,000
97,000
6,000
103.000
$170,000
700,000
177,000
150.000
168,000
1,366,000
100,000
12,000
112,000
10,000
10.000
530,000
0
120.000
660.000
26.000
0
7,000
33,000
2.000
130,000
0
536,000
19,000
0
654,000
60,000
7,000
359,000
0
485,000
844,000
50,000
6,000
66,000
-89.9%
1300.0%
0,0%
-3.6%
266.2%
-29-2%
8.7%
0.0%
-16,5%
-16,6%
1304%
0,0%
0,0%
182,6%
18.2%
-100,0%
0.0%
43.6%
•11.6%
-100 0%
37,2%
31,0%
-100.0%
35.1%
36%
-12 6%
0.0%
0,0%
357%
17.8%
-100 0%
-100 0%
•100.0%
-486%
•167%
($1,506,000)
650,000
177,000
(6,600)
122,000
(662,500)
8,000
0
8,000
(23,000)
(23,000)
(2,000)
(2,000)
300,000
0
120,000
420,000
4,000
(1,000)
7,000
10,000
(1,000)
(1,000)
(17,000)
(2,000)
(19,000)
146,000
4,600
(6,500)
144,000
12,000
(1,000)
0
0
127.600
127,600
(104.000)
(5,000)
(109,000)
(47,000)
(1,000)
(48,000)
(93,000)
(93,000)
B-22 33
CITY OF CARLSBAD
OPERATINtS FUNDS
REVENUE ESTIMATES
REVENUE SOURCE
ACTUAL
REVENUE
2012^13
PROJECTED
REVENUE
2013^14
ESTIMATED
REVENUE
2014^15
CHANGE AS %
OF FY 13-14
PROJECTED
DIFFERENCE
2013-14 TO
2014-16
I SPECIAL REVENUE FUNDS • CONTINUED
RECREATION DONATIONS
DONATIONS & GRANTS
INTEREST
TOTAL RECREATION DONATIONS
RENTAL ASSISTANCE
FEDERAL GRANT
INTEREST
OTHER
TOTAL RENTAL ASSISTANCE
SENIOR DONATIONS
DONATIONS
INTEREST
OTHER
TOTAL SENIOR DONATIONS
STREET LIGHTING
STREET LIGHTING FEES
OTHER
INTEREST
TOTAL STREET LIGHTING
STREET TREE MAINTENANCE
TREE MAINTENANCE FEES
INTEREST
OTHER
TOTAL STREET TREE MAINTENANCE
TOTAL SPECIAL REVENUE FUNDS
42,694
426
6,263,810
3,723
27,573
6,295,106
121,497
351
16,110
136,958
731,952
719,946
3,726
1,455,622
463,949
93
151.680
615,722
32,000
1,500
5,000,000
5,000
19,000
5,024,000
12,000
3,500
12,000
27,500
731,000
146,500
12,500
890,000
463,000
0
194,200
667,200
38,000
0
38,000
6,620,000
6,000
0
5,525,000
10,000
0
15,000
25,000
731.000
129,000
12,000
872,000
463,000
0
64,000
517,000
$15,960,718 $10,907,100 $11,224,000
-100,0%
10.4%
0,0%
-100.0%
10,0%
-16,7%
-100,0%
25.0%
-9.1%
0.0%
-12.0%
-4,0%
-2,0%
0.0%
0.0%
•72.2%
•21,3%
6,000
(1,500)
4,500
520,000
0
(19,000)
601,000
(2,000)
(3,500)
3,000
(2,500)
0
(17,500)
(500)
(18,000)
0
0
(140,200)
(140,200)
B-23 39
REVENUE SOURCE
CITY OF CARLSBAD
OPERATING FUNDS
REVENUE ESTIMATES
ACTUAL PROJECTED ESTIMATED CHANGE AS % DIFFERENCE
REVENUE REVENUE REVENUE OF FY 13-14 2013-14 TO
2012^13 2013-14 2014-15 PROJECTED 2014-16
$25,059,601 $25,100,000 $26,486,670 5,6% $1,385,670
8,853,504 9,000,000 9,497,250 5,6% 497,250
2,905,812 2,758,000 2,861,500 38% 103,500
146,308 130,000 136,000 3,9% 6,000
134,266 130,000 136,000 3,9% 5,000
334,763 266.000 267,500 49% 12,600
(10,661) 68.000 68,500 0.7% 600
77,615 55.000 57,000 36% 2,000
110.356 75,000 87,000 160% 12,000
1,936,867 305,000 316,500 3,8% 11,500
3a,S48,44l i7.m.M 39,911,920 5.4% 2,635,S26
6,126,951 6,300,000 6,550,000 4,0% 250.000
635,115 660,000 660,000 0,0% 0
1,229,340 1.150,000 1,260,000 8.7% 100.000
15,348 52.000 0 -100,0% (62.000)
156,388 100,000 173,475 73,5% 73.475
8,163,142 8,562,O0O 8,633,475 4.5%
11,733,423 11,700,000 11,700,000 0.0% 0
36,697 36.000 35,000 0,0% 0
180,097 176,000 180,000 2.9% 5,000
89,284 75.000 80,000 6.7% 5,000
45,756 76,000 63.119 -17.0% (12,881)
23,468 39,000 46,000 16,4% 6,000
12,108,716 12,100.000 12,103,119 0,0% 3,119
18,690 118.000 112,000 -5,1% (6,000)
289,201 299,000 300,000 03% 1,000
57,597 60,000 69,000 -1 7% (1,000)
2,679,386 2,664,000 2,670,700 0 6% 16,700
319,160 462,000 376,962 -184% (86,038)
3,364,034 3,693,000 3,518,662 -2 1% (74,338)
90,069 0 162 0.0% 162
6,277,627 6,345,000 6,695,403 4,0% 260,403
409,605 999,000 1,031,240 3.2% 32.240
5,y7?,291 A344,600 7,626,795 3,9% 282.795
$69,961,623 $69,175,000 $71,793,971 3,8% $2,518,971
I ENTERPRISE FUNDS
WATER OPERATIONS
WATER SALES
READY TO SERVE CHARGES
PROPERTY TAXES
NEW ACCOUNT CHARGES
BACK-FLOW PROGRAM FEES
PENALTY FEES
INTEREST
ENGINEERING OVERHEAD
SERVICE CONNECTION FEES
OTHER
TOTAL WATER OPERATIONS
RECYCLED WATER OPERATIONS WATER SALES
READY-TO-SERVE CHARGE
RECYCLED WATER CREDITS
INTEREST
OTHER
TOTAL RECYCLED WATER OPERATIONS
WASTEWATER OPERATIONS
SERVICE (JMARGES
MISC SEWER
ENGINEERING OVERHEAD
PENALTY FEES
INTEREST
OTHER
TOTAL WASTEWATER OPERATIONS
SOLID WASTE MANAGEMENT
INTEREST
RECYCLING FEES (AB939)
PENALTY FEES
TRASH SURCHARGE
OTHER
TOTAL SOLID WASTE MANAGEMENT
GOLF COURSE OPERATIONS
-IFntREST
CHARGES FOR SERVICES
OTHER
TOTAL GOLF COURSE OPERATIONS
TOTAL ENTERPRISE FUNDS
B-24
REVENUE SOURCE
ACTUAL
REVENUE
2012-13
CITY OF CARLSBAD
OPERATING FUNDS
REVENUE ESTIMATES
PROJECTED
REVENUE
2013-14
ESTIMATED
REVENUE
2014-15
CHANGE AS %
OF FY 13-14
PROJECTED
DIFFERENCE
2013-14 TO
2014-16
{INTERNAL SERVICE FUNI^
WORKERS' COMPENSATION
INTERDEPARTMENTAL
INTEREST
OTHER
TOTAL WORKERS' COMPENSATION
$1,501,120
8,281
761,194
2,270,595 '
$1,501,000
76.000
1,192,000
2,768,000
$1,661,230
50,000
2.000,000
3,701,230
RISK MANAGEMENT
INTERDEPARTMENTAL
INTEREST
OTHER
TOTAL RISK MANAGEMENT
SELF-INSURED BENEFITS
1.858,550
455
21,059
1,880,074
1,952,000
18.000
767,000
i.?37,6o6
1,961,490
0
0
1,961,495'
INTERDEPARTMENTAL
OTHER
TOTAL SELF^INSURED BENEFITS
VEHICLE MAINTENANCE
748,805
1,884,286
2,633!091
749,000
2,115,000
2,864,000
786,920
114,740
901.660
INTERDEPARTMENTAL
INTEREST
OTHER
TOTAL VEHICLE MAINTENANCE
VEHICLE REPLACEMENT
2.861,958
(2,382)
32,660
2,892,136
2,795,000
0
40,000
j,6ai,06o
3,239,711
0
29,000
3,268,711
INTERDEPARTMENTAL
INTEREST
OTHER
TOTAL VEHICLE REPLACEMENT
INFORMATION TECHNOLOGY
1,820.012
26.068
48,087
1,894,167
1,251,000
179,000
0_
1,430.000
1,680,625
0
0
1,580,625
INTERDEPARTMENTAL
INTEREST
OTHER
TOTAL INFORMATION TECHNOLOGY
6,666,906
7,929
23,330
6,688,164
6,983,000
63,000
6,000
8,176,353
26,400
0
8,202,763
TOTAL INTERNAL SERVICE FUNDS $18,268,227 $19,686,000 $19.706.469
10,0%
-33.3%
67 8%
00%
-100 0%
-100.0%
-W7W
6 1%
-94.6%
-6ti%
15 9%
00%
-27.5%
-WW
34 3%
-100.0%
0.0%
17.5%
17,1%
-68.1%
-100.0%
16.3%
$150,230
(25,000)
808,000
(510)
(18,000)
(767,000)
(7as;5ioi
37,920
(2,000,260)
(1,962!340)
444,711
0
(11,000)
433,711
429,626
(179,000)
0
250,525
1,193,363
(36,500)
(6^000)
1,150J53
$20,469
I REDEVELOPMENT 6BLIGATI0N RETIREMENT FUNDSl
VILLAGE RDA OBLIGATION RETIREMENT FUND
TAX INCREMENT
INTEREST
OTHER
TOTAL VILLAGE OPERATIONS / DEBT SERVICE
639,618
64,848
2.920,979
1,646.000
3,000
0
3,625,445 1,549,000
1,997.828
20,000
0
2,0lt,6i8
TOTAL REDEVELOPMENT FUNDS $3,525,445 $1,649,000 $2,017,828
21.4%
566,7%
00%
22.4%
351.828
17,000
0
IT6TAL 6P^RATING FUND5~ $231,196,763 $224,460,100" $232,006,268 $7,646,168 I
B-25
DEPARTMENT
CITY OF CARLSBAD
OPERATING FUNDS
BUDGET EXPENDITURE SCHEDULE
2011-12
ACTUAL*
2012-13
ACTUALS
2013-14
ESTIMATED
EXPENDITURES
2013-14
BUDGET
2014-15
BUDGET
Exhibit 4
%INCR/(DECR)
13- 14 BUD
TO
14- 15 BUD
IGENERALFUND
POLICY AND LEADERSHIP GROUP
CITY COUNCIL
CITY ATTORNEY
CITY CLERK
CITY MANAGER
CITY TREASURER
COMMUNITY OUTREACH AND ENGAGEMENT
TOTAL POLICY AND LEADERSHIP GROUP
ADMINISTRATIVE SERVICES
FINANCE
HUMAN RESOURCES
RECORDS MANAGEMENT
TOTAL ADMINISTRATIVE SERVICES
COMMUNITY DEVELOPMENT
COMMUNITY AND ECONOMIC DEVELOPMENT
HOUSING AND NEIGHBORHOOD SERVICES
TOTAL COMMUNITY DEVELOPMENT
COMMUNITY SERVICES
LIBRARY AND CULTURAL ARTS
PARKS AND RECREATION
TOTAL COMMUNITY SERVICES
PUBLIC SAFETY
FIRE
POLICE
TOTAL PUBLIC SAFETY
PUBLIC WORKS
PROPERTY AND ENVIROMENTAL MANAGEMENT
TRANSPORTATION
STORM DRAIN ENGINEERING
TOTAL PUBLIC WORKS
$337,699
1,289,939
124,036
1,442,294
183,730
638.541
4.016.139
3.396,659
2,285,191
687,969
6,368,819
7,035,103
499,230
7.634,333
10.418,263
12,160,698
22,578,961
17,034,490
27,506,352
44,640,842
4,707,149
8,327,015
237,203
13,271,367
$364,428
1,286,037
101,502
1,737,511
186,597
698,799
4,363,874
3,248,400
2,293,016
650,547
6,191,962
6,961,921
522,669
7,484,690
10,282,856
11,603,390
21,886,246
17,915,669
27,766,320
46,671,989
4,734,322
8,084,830
270,793
13,089,946
$340,274
1,460,000
336,000
1,765,000
202,061
880,000
4,983,326
4,432,000
2,289,000
292,000
7,013,000
7,749,637
603,095
8,352,732
10,679,637
13,238,000
23,917,637
17,904,427
29,380,439
6.088,818
9,200,000
271,303
15,560,121
$364,866
1,316,806
63,347
1,388,651
207,614
697,185
4,038,369
3,591,465
2,399,628
802,226
6,793,319
6,842,728
598,583
10,394,004
13,198,247
17,777,047
28,746,830
46,523,877
6,666,646
8,696,680
279,098
14,542,224
367,220
1,373,169
631,474
1,874,568
200,226
1,283,257
6,629,904
3,747,584
2,876,229
302,342
6,926,156
J,159,731
721,317
11,228,043
14,697,658
25,926,701
18,933.836
29.077.696
6.100,791
9.277,863
278.334
06%
4,3%
739.0%
35 0%
-3.6%
84 1%
394%
4 3%
19 9%
-62 3%
2.0%
19 2%
20 5%
8 0%
114%
6 5%
12%
6 7%
-03%
16,656,988 7.7%
NOTE: ESTIMATED EXPENDITURES MAY EXCEED ADOPTED BUDGET SINCE THEY INCLUDE PRIOR YEAR BUDGET APPROPRIATIONS
• ACTUALS, ESTIMATED EXPENDITURES AND BUDGET HAVE BEEN ADJUSTED TO REFLECT THE CITY'S REORGANIZATION IMPLEMENTATION,
B-26
CITY OF CARLSBAD
OPERATING FUNDS
BUDGET EXPENDITURE SCHEDULE
DEPARTMENT
2011-12
ACTUAL*
2012-13
ACTUALS
2013-14
ESTIMATED
EXPENDITURES
2013-14
BUDGET
2014-16
BUDGET
%INCR/(DECR)
13- 14 BUD
TO
14- 16 BUD
GENERAL FUND - CONTINUED
MISCELLANEOUS NON-DEPARTMENTAL
EXPENDITURES
COMMUNITY CONTRIBUTIONS
DUES & SUBSCRIPTIONS
LEGAL SERVICES
PROFESSIONAL SERVICES
OTHER MISCELLANEOUS EXPENDITURES
PERSONNEL RELATED
PROPERTY TAX & OTHER ADMINISTRATION
TOTAL EXPENDITURES
TRANSFERS
INFRASTRUCTURE REPLACEMENT FUND
TRANSFERS TO SELF INSURED BEN -PERS SETASIDE
TRANSFERS TO GOLF COURSE
TRANSFER TO LLD#1 (MEDIANS & TREES)
TRANSFER TO STORM WATER PROGRAM
OTHER MISCELLANEOUS TRANSFERS
TOTAL TRANSFERS
TOTAL MISCELLANEOUS NON-DEPARTMENTAL
SUBTOTAL GENERAL FUND
CONTINGENCIES
TOTAL GENERAL FUND
187,316
54,481
60,656
166,892
367,818
57,904
735,656
7,382.000
1,400.000
1.644,692
473,000
166,497
1,629,806
12,694,896
14.326,618
112,636,069
$112,636,069
136,057
61,492
28,618
392.391
270.516
63,719
586,864
1,527,646
7,547,000
1,800,000
251,072
627,746
246,931
668,661
11,030,310
12,557,966
111,246,662
$111,246,662
30,000
62,000
80,000
675,000
400,000
134,000
560,000
1,931,000
7,800,000
2,000,000
998,649
545,000
263,000
3,197,800
14,794,349
16,725,349
123,837,030
$123.637,030
0
60.000
80,000
476,000
0
176,000
660,000
1,440,000
7,800,000
2,000,000
998,549
646,000
263,000
2,197,800
13,794,349
15,234,349
1,600,000
$119,666,690
0
66,000
80,000
186,000
0
904,632
622,000
1,846,632
8,302,000
0
1,031,240
639,000
261,962
0
10,124,202
11,970,834
123,002,162
1,500,000
-8.3%
00%
-61 1%
416.9%
-4.3%
64%
-100 0%
3 3%
-1,1%
-0 4%
-100 0%
-26 6%
$124,502,162
B-27
V3
CITY OF CARLSBAD
OPERATING FUNDS
BUDGET EXPENDITURE SCHEDULE
DEPARTMENT
2011-12
ACTUAL'
2012-13
ACTUALS
2013-14
ESTIMATED
EXPENDITURES
2013-14
BUDGET
2014-15
BUDGET
%INCR/(DECR)
13- 14 BUD
TO
14- 15 BUD
SPECIAL REVENUE FUNDS
AFFORDABLE HOUSING
BUENA VISTA CHANNEL MAINTENANCE
CITIZEN'S OPTION FOR PUBLIC SAFETY
COMMUNITY ACTIVITY GRANTS
COMMUNITY DEVELOPMENT BLOCK GRANT
CULTURAL ARTS DONATIONS
LIBRARY AND ARTS ENDOWMENT FUND
LIBRARY GIFTS/BEQUESTS
LIGHTING AND LANDSCAPING DISTRICT NO. 2
LOCAL CABLE INFRASTRUCTURE FUND
MEDIAN MAINTENANCE
PARKING IN LIEU
POLICE ASSET FORFEITURE
POLICE GRANTS
RECREATION DONATIONS
RENTAL ASSISTANCE
SENIOR DONATIONS
STREET LIGHTING
STREET TREE MAINTENANCE
TOTAL SPECIAL REVENUE FUNDS
$668,816
111,753
99,569
1,680
1,287,064
66,417
4,195
117,952
214,644
209,422
769,636
0
247,319
748,169
44,795
6,620,112
16,924
1,180,248
662,694
$13,051,309
$4,211,186
204,468
124,984
46,460
2,096,540
41,142
2,000
91,764
233,666
261,511
730,335
42,359
202,161
643,148
21,296
6,356,546
25,447
861,100
643,490
$16,726,601
$493,297
115,000
131,377
10,000
229,810
73,000
0
150,000
264,000
299,000
800,000
42,200
140,323
172,000
6,000
6,001,644
20,000
774,600
626,000
$10,337,151
$461,067
106,925
125,035
10,000
663,190
58,400
4,000
63,367
246,439
356,738
741,370
42,000
261,761
0
61,969
5,990,386
35,100
882,971
649,668
$10,649,386
$637,380
106,275
142,368
14,000
94,639
74,500
4,000
60,376
261,476
622,138
843,833
44,000
181,140
0
80,500
6,249,066
36,600
860,276
533,345
$10,626,900
166%
03%
13.9%
40 0%
-83.2%
27,6%
0 0%
-20 6%
2 0%
464%
13 8%
4 8%
-28.1%
29 9%
4,3%
4 3%
-2 6%
-17 9%
-0,2%
ENTERPRISE FUNDS
WATER OPERATIONS
RECYCLED WATER OPERATIONS
WASTEWATER OPERATIONS
SOLID WASTE MANAGEMENT
GOLF COURSE OPERATIONS
TOTAL ENTERPRISE FUNDS
$30,796,638
7,332,486
10.374,682
2,941,131
7,528,196
$68,973,131
$36,016,968
7,264,458
11,388,038
2,861,179
7.665,238
$64.194,881
$36,150,428
10.938,812
11,796,876
2.870,363
7,396,076
$69,162,566
$36,077,284
7,523,438
11,186,622
3,696,771
7,498,961
$66,881,976
$37,828,272
7,575.742
12,382.263
3,513,918
7,477,931
$68,778,126
49%
0 7%
107%
-2 3%
-0 3%
4 4%
INTERNAL SERVICE FUNDS
WORKERS' COMPENSATION
RISK MANAGEMENT
SELF-INSURED BENEFITS
VEHICLE MAINTENANCE
VEHICLE REPLACEMENT
INFORMATION TECHNOLOGY
TOTAL INTERNAL SERVICE FUNDS
$2,236,634
1,356.762
892.560
2.773.322
1,406,396
6,298,298
$14,962,862
$3,962,146
1,871,775
3,404,933
2,702,769
660,649
6,141,226
$18,743,398
$3,904,882
1,375,000
709,222
2.977.813
3,038,406
7,200,000
$19,205,322
$1,774,781
1,701,927
1,621,397
2,874,734
1,287,666
8,088,407
$17,248,811
$2,026,466
1,809,248
3.554,614
3,269,004
1,962,600
9,308,666
$21,920,397
14.2%
6.3%
1336%
13,7%
61,6%
16 1 %
27 1%
I REDEVELOPMENT OBLIGATION RETIREMENT FUNDS j
VILLAGE RDA OBLIGATION RETIREMENT FUND
sec RDA OBLIGATION RETIREMENT FUND
TOTAL REDEVELOPMENT
$1,473,037
146,863
$1,619,900
$763,349
0
$763,349
$1,191,370
0_
$1,191,370
$1,291,415
0_
$1.291,415
$1,316,279
0
$1,315,279
TOTAL OPERATING FUNDS $201,243,271 $211,674,791 $223,723,428 $214,737,278 $227,141,864 5 8%
General Fund
Non GF
$124,502,162
102,639,702
$227,141,864
NOTE: Estimated expenditures may exceed Adopted Budget since they include prior year budget appropriations.
B-28
Exhibit 5
PERSONNEL ALLOCATIONS
FINAL
BUDGET
2012-13
FINAL
BUDGET
2013-14
FINAL
BUDGET
2014-15
2014-15
CHANGES
CITY ATTORNEY 7.00 7.00 7.00 0.00
CITY CLERK 0.00 0.00 3.00 3.00
CITY COUNCIL 1.00 1.00 1.00 0.00
CITY MANAGER 7.00 7.00 7.00 0.00
CITY TREASURER 0.75 0.75 0.75 0.00
COMMUNICATIONS 2.75 2.75 4.75 2.00
COMMUNITY AND ECONOMIC DEVELOPMENT 47.00 44.00 44.00 0.00
FINANCE AND RISK MANAGEMENT 30.50 31.50 31.50 0.00
FIRE 87.75 88.00 89.00 1.00
HOUSING AND NEIGHBORHOOD SERVICES 10.00 10.00 12.00 2.00
HUMAN RESOURCES & WORKERS COMP 9.00 9.00 11.00 2.00
INFORMATION TECHNOLOGY 22.50 22.50 22.50 0.00
LIBRARY & ARTS 51.25 51.25 50.25 (1.00)
PARKS AND RECREATION 68.40 67.60 61.60 (6.00)
POLICE 161.00 161.00 162.00 1.00
PROPERTY AND ENVIRONMENTAL MANAGEMENT 40.55 40.60 40.90 0.30
RECORDS MANAGEMENT 6.00 5.00 2.00 (3.00)
TRANSPORTATION 54.40 53.40 55.90 2.50
UTILITIES 67.65 65.40 64.60 (0.80)
FULL AND 3/4 TIME LABOR FORCE 674.50 667.75 670.75 3.00
SUMMARY OF REQUESTED LABOR FORCE BY CATEGORY
2012-13 2013-14 FY 2014-15 Difference
Full Time Personnel
3/4 Time Personnel in Full Time Count
Limited Term Personnel
Unfunded Full Time Positions
Hourly Full Time Equivalent Personnel
669.00
4.50
1.00
0.00
132.58
661.00
3.75
2.00
1.00
150.58
666.00
3.75
0.00
1.00
157.77
5.00
0.00
(2.00)
0.00
7.19
TOTAL LABOR FORCE* 807.08 818.33 828.52 10.19
B-29
Exhibit 6
FY 2014-15
MASTER FEE SCHEDULE CHANGES
For FY 2014-15 it is proposed that fees be changed by the one year increase in their associated index,
unless, the actual cost of providing the service can't accept the indexed increase. In this instance the fee
will be set at the cost of service.
Below is a list ofthe indexes and the fees that are associated with them:
INDEX
ONE
YEAR ASSOCIATED FEES
West Urban CPI 1.48% General City and Development Related Service Fees
Ambulance
Inflation Factor 1.00% Ambulance Fees
INDEX
ONE
YEAR ASSOCIATED DEVELOPMENT IMPACT FEES
January ENR 4.47%
PLDA Fees and License Tax on New Construction Mobile
Homes
April ENR 4.33%
All Other Develop. Impact Fees ( Sewer Benefit Area, Sewer
Connection, Water District, and Bridge & Thoroughfare
District #2)
December ENR 4.55% Bridge & Thoroughfare District #3
April San Diego
CPI 1.31% Habitat Mitigation Fee
Cal Trans CCI 8.2% Traffic Impact Fees
The following fees are proposed to change for FY 2014-15:
NEW FEES:
Community & Economic Development-Non Conforming Permit-$697. Code amendment allowing
non-conforming structures and uses to be repaired/altered.
Building Valuation Multipliers will be added as a schedule to the Development Related Service Fees.
This fee has always been charged it is just being added to the Master Fee Schedule.
Ambulance Fee-Advanced Life Support 1-Resident-Plus Level I or Level II Supplies and Medications-
$1,150.
Ambulance Fee-Advanced Life Support 1-Non-Resident-Plus Level I or Level II Supplies and
Medications-$1,250.
Ambulance Fee-Advanced Life Support 2-Resident-Plus Level II Supplies and Medications-$1,250.
Ambulance Fee-Advanced Life Support 2-Non-Resident-Plus Level II Supplies and Medications-$1,350.
Ambulance Transport-Community Paramedicine BLS-Resident-$938.26. Fee to transport stable
patients to an alternate destination (i.e. Kaiser).
o
o
o
Exhibit 6
o Ambulance Transport-Community Paramedicine ALS-Resident-Plus Level I or Level II Supplies &
Medications-$1,150
o Ambulance Transport-Community Paramedicine-Level I Supplies and Medications-$125.
o Ambulance Transport-Community Paramedicine-Level ll-Supplies and Medications-$250.
o Parks-Major Trail Plan Check>l Mile-Sl,400. This fee is part of the cost of service study and is
currently being charged. It is just being added to the Master Fee Schedule,
o Parks-Minor Trail Plan Check <1 Mile - $700. This fee is part of the cost of service study and is currently
being charged. It is just being added to the Master Fee Schedule,
o Parks-Trails lnspection-$300. This fee is part of the cost of service study and is currently being charged.
It is just being added to the Master Fee Schedule.
INCREASED FEES:
o Ambulance Fee-Advanced Life Support l-Assessment going from $156.38 to $200.
o Ambulance Fee-Mileage Charge-per mile going from $17.72 to $23.
o Ambulance Fee-Oxygen Charge going from $67.76 to $75.
o Waste Management trash collection fees are listed on the Master Fee Schedule but are a pass through
fee. These fees are increasing for FY 2014-15.
o Street Light Energizing Fees are increasing due to a rate increase from SDG&E.
o Fish & Wildlife Fee-EIR and Fish & Wildlife Fee-Negative Declaration are set by the Department of Fish
and Wildlife and are pass through fees.
REDUCED FEES:
o Police-Report Copy (Free to Victim) Plus Cost of Reproduction is being reduced from $16 to $10.
o Community & Economic Development-Certificate of Compl. In Lieu of Parcel Map is being reduced
from $3,580 to $3,000 because process/application is simpler and cost to provide service was
reevaluated.
DELETED FEES:
o Ambulance Fee Supplies Charge
The following fees are being deleted because of code amendment changes that don't require these fees
anymore:
o Community & Economic Development-Administrative Permit-IODA.
o Community & Economic Development-Daycare Permit-Center Admin Pmt.
o Community & Economic Development-Daycare Permit-Extension.
o Community & Economic Development-PD/Condo-Minor Amendment.
o Community & Economic Development-Planned Industrial Permit.
o Community & Economic Development-Planned Industrial Permit-Amendment.
HI
Exhibit 6
TITLE CHANGES:
CURRENT FEE DESCRIPTION NEW FEE DESCRIPTION
Campaign Sign Permit (plus a $200 refundable
deposit) Campaign Sign Permit
Curb Cafe Permit Curb Cafe Permit-Village Review Area
Hillside Dev Permit - Single Family Lot Hillside Dev Permit-Minor
Hillside Dev Permit Amendment - Single Family
Lot Hillside Dev Permit Amendment-Minor
Park In Lieu Fee - Village Redevelopment Area Park In Lieu Fee - Village Area
Sidewalk Cafe Permit - Village Review Area Sidewalk Tables and Chairs-Village Review Area
Village Area Sidewalk Outdoor Dining and Curb
Cafe (max of 2 parking spaces)
Village Area Sidewalk Outdoor Dining and Curb Cafe
(max of 2 parking spaces) Annual
MOVED TO ANOTHER PUBLICATION:
o Library Facility Fees and Schulman Auditorium Audio/Video Service Fees will be moved off the Master
Fee Schedule to a departmental publication.
"is
FY 2014‐15Preliminary Operating BudgetJune 3, 20141
FY 2014‐15 Budget CalendarCouncil Meetings:–May 20 –CIP workshop–Set public hearing for June 17–June 3 – Operating Budget Workshop–June 17 – Public hearing and adoption of Fiscal Year 2014‐15 Operating and Capital BudgetsOther Public Meetings:–June 5 – Citizens Budget Workshop ‐Faraday, 6 p.m.
FY 2014‐15 Budget Overview•Focus on moving city forward–Align resources with Goals and Priorities–Build for the future•Fiscal Responsibility–Balanced budget–Long‐term sustainability–Healthy reserves
City of CarlsbadFY 2014‐15 Combined Budget$307 millionOperating Budget – 74%Capital – 26%General Fund, $125 MSpecial Revenue, $11 MEnterprise, $69 MInternal Service, $22 MCapital Projects, $80 M
EmploymentHousingFed PolicyStock Prices5National & Global Outlook
U.S. GDP Growth Rate6
Balanced BudgetHousingEmployment7State Perspective
Unemployment Rate0246810CACarlsbad/San MarcosSD CountyUS
Carlsbad’s Economic Profile•Home prices•Taxable sales•Tourism
Median SFR Home Prices
General Fund Revenues11
FY 2014‐15 General Fund Revenues $127.3 million12Property Tax (*), $51.6 , 40%Sales Tax (*), $31.7 , 25%Hotel Tax (*), $16.5 , 13%Franchise, $5.0 , 4%Business License, $3.8 , 3%Other , $18.7 , 15%
Assessed Values and Property Taxes13 ‐ 10.0 20.0 30.0 40.0 50.0 60.0 ‐ 5.0 10.0 15.0 20.0 25.0FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014f FY 2015eMillionsBillionsAV ResidentialAV Com/IndustProperty Taxes
Sales Tax14
15
Transient Occupancy Taxes
FY 2014‐15 Operating Revenues by Fund Type = $232 million17General55%Special Revenue5%Redevelopment Obligation Retirement1%Enterprise31%Internal Service8%
2014‐15Proposed Operating Budget
Operating Budget ProcessCity Council’s goals and priority projects and services10 year forecast updatedBudget policies set for new fiscal yearDepartments submit requests to FinanceBudget reviewed; City Manager makes recommendations to City CouncilCity Council adopts budget
FY 2014‐15 Budget Policies•Continue Excellent City Services•Modest Growth allowed in M&O•Budget & Staff Increases considered for city priorities and goals•Budgetary prudence exercised
FY 2014‐15 Full‐Time Position Changes•Addition of 3 full‐time positions (net):–8 full‐time positions eliminated –11 full‐time positions added •Hourly FTE’s 7 new full‐time equivalents:–5.6 FTE for Alga Norte Park–1.4 FTE for other departments
FY 2014‐153 Full‐Time Position Additions Additions (11):1.0 Business Systems Specialist1.0 Code Compliance Specialist1.0 Facilities Manager (was limited term)1.0 Fire Marshall1.0 Housing Assistant1.0 Management Analyst1.0 Office Specialist II1.0 Secretary1.0 Senior Applications Analyst1.0 Training Coordinator1.0 Traffic Systems Operator22Eliminations (8):4.0 Parks Maintenance Worker II1.0 Tree Trimmer Lead Worker1.0 Administrative Secretary1.0 Engineering Technician1.0 Administrative Secretary
FY 2014‐15 Full‐Time Position Changes (continued)•Total citywide full‐time position count:667.75 FY 2014‐15 total 3.00 Add: net position changes670.75 FY 2014‐15 total
City of CarlsbadHistory of Budgeted Full‐Time Positions640650660670680690700710720FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15695.75717.25717.75716.25699684.25674.5667.75670.75
FY 2014‐15 Operating Budget$227 million ‐expendituresGENERAL FUND$125M, 55%SPECIAL REVENUE, RORF, $11M, 5%ENTERPRISE, $69M, 30%INTERNAL SERVICE, $22M, 10%
FY 2014‐15 Budget EnhancementsGeneral Fund ‐$2,396,677Other Funds ‐$1,250,48126
Police Department•Collaboration, Innovation, and Engagement •Technology Foundation projects underway–On line crime reporting ‐live in June–Telestaff project ‐underway–Records Management System ‐begins in the fall•ICMA organizational analysis is underway•Recruitment •Training and professional development•Social media for community inclusion, education and feedback
Fire Department•Regional collaboration– Monitoring to capture opportunities•Standardization of equipment–Zoll Medical cardiac monitors•Innovation and efficiencies– Community Paramedicine– Addition of a Fire Marshal position
Library & Cultural Arts•Community Arts Grant Program Expansion•Public Art Master Plan29Coastal Helix at the Coastal Rail Trail Roundabout
Community and Economic Development•North County Five Cities branding•Life in Action website•Business outreach program•Tourism Strategic Plan•2015 Business Survey30
Community and Economic DevelopmentTechnology Upgrades•New permitting and licensing system (ICDS)•Digital archiving of building plans•CED Analyst position31Succession Planning•Building Inspector intern program•New permitting and licensing system (ICDS)•Cross‐training
Community and Economic DevelopmentMajor Upcoming Projects or Priorities•Barrio & Village Master Plan•General Plan Update•Quarry Creek•Cantarini/Holly Springs•Robertson Ranch West Village•ViaSat –Phase 232
Public Works Budget Highlights•Reclassification to traffic systems operations specialist (TSOS) position to improve traffic coordination•Part time technical assistant for PEM•Install “smart” manhole covers to reduce sanitary sewer overflows
Public Works Budget Highlights•Two part time technical assistants for facility CIP projects:–Library renovations–Fire station relocation –Fleet renovation
Parks and RecreationState Beach Improvements•Picnic facility maintenance–Includes landscape irrigation, hardscape, and restroom/pump station–$75,000 (ongoing)•Coastal bluff maintenance–Including landscape and irrigation–$40,000 (ongoing)
Parks and RecreationPark Master Plan Updates•Poinsettia, Aviara, and Pine Avenue Community Parks–Proposals received; agreement expected by end of June–$75,000 (estimate)•Leo Carrillo Ranch Historic Park–Contract awarded to KTU&A; work commences June 2014–$30,000
Sustainable OrganizationBudget Action(s)•Management Analyst •Outside Recruiting Assistance •Class and Comp Studies •Training Coordinator37
Economic DevelopmentBudget Action(s)•Higher Education Goal •Code Compliance Specialist •Housing Assistant 38
Changing Park & Recreation NeedsBudget Action(s)•5.6 FTE part‐time positions39
Technology Budget Action(s)•Digital Records Management Program•IT contractual increases40
Environmental ManagementBudget Action(s)–Meters for new development–Air Vac Assemblies–Smart Covers–Chemicals–Water Hydrants–Grinders, Impellers, Digi Gauges, Odor Controls41
Sustainable OrganizationBudget Action(s)•Utility increases – SDG&E •Utility increases –Water 42
FY 2014‐15 General Fund$124.5 millionPolicy/Leadership, 5.6M, 4%Community & Economic Dev., 6.9M, 5%Administrative Services, 8.9M, 7%Community Services, 25.9M, 21%Public Safety, 48M, 39%Public Works, 15.7M, 13%Non‐departmental, 13.5M, 11%43
FY 2014‐15General Fund Budget Recap Revenues$ 127.3 millionBudget requests $ 124.5 millionProjected remainder $ 2.8 million 44
General Fund Balance45Estimated Balance at 7/01/14 $ 68.8 millionPlus: FY 2014‐15 Excess2.8 million= 6/30/15 Estimated Balance(*) $ 71.6 million*Excludes impact of Council Program Options
FY 2014‐15 Special Revenue Funds$10.6 millionMaintenance Districts, $2.6M, 25%Local Cable Infrastructure, $0.5M, 5%Other, $1.3M, 12%Housing Programs, $6.2M, 58%46
FY 2014‐15 Internal Service Funds$21.9 millionWorker's Compensation, $2M, 9%Risk Management, $1.8M, 8%Self‐insured Benefits, $3.6M, 16%Vehicle Maint., $3.3M, 15%Vehicle Repl., $1.9M, 9%Information Technology, $9.3M, 43%47
FY 2014‐15Internal Service FundsExpenditure highlights:•Fleet Replacement Equipment ‐$1.9 million–Wastewater Combo Pumper ($500,000)–Transportation ‐Large Paint Truck ($305,000)•I.T. Replacement Equipment‐$1.9 million–VOIP/Voice Over phone system replacement•$2 million transfer to Worker’s Comp fund–Increased claims and liability
FY 2014‐15 Enterprise Funds$68.8 millionWater Operations, $37.8M, 55%Recycled Water, $7.6M, 11%Wastewater Operations, $12.4M, 18%Solid Waste Management, $3.5M, 5%Golf Course Operations, $7.5M, 11%49
Water Purchase Cost Increases•Purchased potable water from San Diego County Water Authority–Wholesale water –3.6% increase–Fixed charges –5% increase
Utility Rates51•Two year rate increases approved•January 1, 2015 = second year
Fee Update
Fee Descriptions•General city fees–Charged for the usage of city services and property•Development related service fees–Charged to recover the cost of staff time & materials spent on development related activities•Development impact fees–Charged to recover the cost that growth is anticipated to have on city infrastructure53
Fee Escalators•Updated by change in West Urban Consumer Price Index (CPI)–General city fees–Development related service fees •Updated by change in Engineering News Record Index (ENR)–Development impact fees54
Cost of Service•Cost of Service Study was completed last year.–Updated every 2 years•A comparison of the cost to provide the service and the fee requires that a number of fees be reduced.
Fee EscalatorsINDEXONE YEAR ASSOCIATED FEESWest Urban CPI1.48%General City and Development Related Service FeesAmbulance Inflation Factor1.00%Ambulance Fees
Fee Escalators –Development Impact FeesINDEXONE YEAR ASSOCIATED DEVELOPMENT IMPACT FEESJanuary ENR4.47%PLDA Fees and License Tax on New Construction Mobile HomesApril ENR4.33%All Other Develop. Impact Fees ( Sewer Benefit Area, Sewer Connection, Water Connection, and Bridge & Thoroughfare District #2 )December ENR4.55% Bridge & Thoroughfare District #3April San Diego CPI1.31% Habitat Mitigation Fee
Ambulance Fees•Basic Life Support will stay at same rate.•Advanced Life Support is increasing to cover the level of service medicines and supplies, and to bring to fee in line with actual costs.•Ambulance Transport including Community Paramedicine is a new fee for transferring patient to an alternate facility.
Library Fees•Library Facility Fees and Schulman Auditorium Audio/Visual Service Fees will be moved off the Master Fee Schedule
Other Fee Changes•Adding Parks Trails Plan Check/Inspection that is currently in use•Increase in Street Light Energizing Fee•Increase in Trash Collection Fees•Deleting Fees not in use or eliminated due to code changes•Decrease in fees that exceed Cost of Service•Added fees that were adopted in current fiscal year
QUESTIONS
Council ActionSet Public Hearing for June 17, 2014
The following slides are not part of the presentation63
Infrastructure Replacement Fund•Funds the replacement of buildings and facilities (non water or sewer)•Annual contribution ($90.7 million)–1998‐99 to 2009‐10: $52.5 million–FY 2010‐11: $ 7.2 million–FY 2011‐12: $ 7.4 million–FY 2012‐13: $ 7.5 million–FY 2013‐14: $ 7.8 million–FY 2014‐15: $ 8.3 million64
65
66
67