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HomeMy WebLinkAbout; ; 2010-2011 Operating Budget and CIP; 2010-07-01 City of Carlsbad 2010-11 Operating Budget and Capital Improvement Program Mayor Claude "Bud" Lewis City Council Ann Kulchin Matt Hall Mark Packard Keith Blackburn City Manager Lisa Hildabrand Deputy City Manager Cynthia Haas Prepared by the Finance Department Acting Finance Director Kevin Branca Website: www.carlsbadca.gov Cover design by: Kelly Gilfillen On the Cover: The pictures on the cover highlight each of the 12 functional departments in the City. CITY OF CARLSBAD, CALIFORNIA 2010-2011 BUDGET TABLE OF CONTENTS Reader’s Guide to the Budget ................................................................................................................. i Council’s Five-Year Vision Statements ................................................................................................... ii About the City of Carlsbad ..................................................................................................................... iii Organization Chart ................................................................................................................................. iv BUDGET OVERVIEW City Manager’s Transmittal Letter........................................................................................................ A-1 2010-11 Budget Highlights .................................................................................................................. A-3 Budget Process ................................................................................................................................... A-4 Community Vision ............................................................................................................................... A-4 Budget Summary .............................................................................................................................. A-21 Personnel Allocations........................................................................................................................ A-22 2009-10 Budget Calendar ................................................................................................................. A-23 Budget Awards.................................................................................................................................. A-24 OPERATING BUDGET Overview ............................................................................................................................................. B-1 Projected Fund Balances .................................................................................................................. B-18 Revenue Estimates ........................................................................................................................... B-20 Budget Expenditure Schedule ........................................................................................................... B-26 PROGRAM SUMMARIES Policy & Leadership Group Policy and Leadership Group Summary ......................................................................................C-1 City Council .................................................................................................................................C-2 City Clerk ....................................................................................................................................C-4 City Treasurer .............................................................................................................................C-5 City Manager ...............................................................................................................................C-7 Communications .........................................................................................................................C-9 City Attorney ............................................................................................................................. C-11 Internal Services Finance Summary .......................................................................................................................D-1 Finance .......................................................................................................................................D-2 Risk Management .......................................................................................................................D-5 Human Resources Summary ......................................................................................................D-6 Human Resources ......................................................................................................................D-7 Workers’ Compensation ..............................................................................................................D-9 Self-Insured Benefits ................................................................................................................. D-10 Information Technology ............................................................................................................. D-11 Miscellaneous Non-Departmental .............................................................................................. D-13 Property & Environmental Management Summary .................................................................... D-14 Property & Environmental Management .................................................................................... D-15 Storm Water Protection ............................................................................................................. D-17 Vehicle Maintenance ................................................................................................................. D-20 Vehicle Replacement ................................................................................................................ D-22 CITY OF CARLSBAD, CALIFORNIA 2010-2011 BUDGET TABLE OF CONTENTS Community Development Community & Economic Development Summary ........................................................................ E-1 Administration ............................................................................................................................. E-2 Land Development Engineering .................................................................................................. E-4 Land Use Planning & Planning Commission ............................................................................... E-7 Building and Code Enforcement ................................................................................................ E-10 South Carlsbad Coastal Redevelopment Area .......................................................................... E-11 Housing & Neighborhood Services Summary ............................................................................ E-12 Neighborhood Services ............................................................................................................. E-13 Affordable Housing .................................................................................................................... E-15 Rental Assistance ..................................................................................................................... E-16 Community Development Block Grant ....................................................................................... E-17 Redevelopment Operations Village Area ................................................................................... E-19 Low/Moderate Income Housing Village Area ............................................................................. E-21 Low/Moderate Income Housing South Carlsbad Coastal Area .................................................. E-22 Community Services Library Summary ......................................................................................................................... F-1 Georgina Cole Library ................................................................................................................. F-2 Carlsbad City Library ................................................................................................................... F-4 Library Learning Center ............................................................................................................... F-6 Technical Services ...................................................................................................................... F-8 Collection Development & Acquisitions ..................................................................................... F-10 Media Services .......................................................................................................................... F-11 Community Relations ................................................................................................................ F-12 Cultural Arts Summary .............................................................................................................. F-14 Arts Office ................................................................................................................................. F-16 Sister City .................................................................................................................................. F-18 Cultural Arts Donations ............................................................................................................. F-19 Parks and Recreation Summary ................................................................................................ F-20 Park Planning & Recreation Management ................................................................................. F-23 Recreation – Fee Supported ..................................................................................................... F-25 Recreation – Aquatics ............................................................................................................... F-29 Recreation – Operations ........................................................................................................... F-32 Senior Programs ....................................................................................................................... F-35 Park Maintenance ..................................................................................................................... F-38 Trails ......................................................................................................................................... F-40 Street Tree Maintenance ........................................................................................................... F-42 Median Maintenance ................................................................................................................. F-43 Public Safety Fire Summary............................................................................................................................. G-1 Fire Administration ..................................................................................................................... G-3 Emergency Operations ............................................................................................................... G-4 Weed Abatement ....................................................................................................................... G-5 Emergency Preparedness .......................................................................................................... G-6 Support Services ........................................................................................................................ G-7 Prevention .................................................................................................................................. G-8 Police Department Summary ...................................................................................................... G-9 Police Administration ................................................................................................................ G-11 Field Operations ....................................................................................................................... G-12 Community Services ................................................................................................................ G-13 CITY OF CARLSBAD, CALIFORNIA 2010-2011 BUDGET TABLE OF CONTENTS Public Safety (continued): Canine ..................................................................................................................................... G-15 Investigations/Field Evidence ................................................................................................... G-16 Vice/Narcotics .......................................................................................................................... G-17 Youth/School Programs ........................................................................................................... G-18 Property and Evidence/Records ............................................................................................... G-19 Family Services ........................................................................................................................ G-20 Task Force ............................................................................................................................... G-21 Support Operations .................................................................................................................. G-22 Communications Center ........................................................................................................... G-23 Police Asset Forfeiture ............................................................................................................. G-24 Citizens Option for Public Safety .............................................................................................. G-25 Police Grants............................................................................................................................ G-26 Public Works Transportation .............................................................................................................................H-1 Administration and Construction Management & Inspection ........................................................H-2 Storm Water Protection ...............................................................................................................H-6 Street Maintenance .....................................................................................................................H-8 Traffic Signal Maintenance ........................................................................................................ H-10 Street Lighting ........................................................................................................................... H-11 Lighting and Landscape District No. 2 ....................................................................................... H-12 Utilities Summary ...................................................................................................................... H-13 Storm Drain Engineering ........................................................................................................... H-14 Buena Vista Channel Maintenance ........................................................................................... H-15 Water Operations ...................................................................................................................... H-16 Wastewater Operations ............................................................................................................. H-19 Solid Waste Management ......................................................................................................... H-21 Storm Drain Maintenance .......................................................................................................... H-23 CAPITAL IMPROVEMENT PROGRAM – OPERATING BUDGET Overview ............................................................................................................................................ I-1 Project Evaluation .............................................................................................................................. I-2 Capital Projects – The Next Five Years .............................................................................................. I-2 Capital Projects through Buildout ....................................................................................................... I-5 Future Growth and Development ....................................................................................................... I-7 Revenues ........................................................................................................................................... I-8 Summary ......................................................................................................................................... I-10 Growth Management Plan ............................................................................................................... I-10 Capital Funds Projected Fund Balances for FY 2009-2010 .............................................................. I-12 Capital Funds Projected Fund Balances for FY 2010-2011 .............................................................. I-13 Capital Revenues Actual and Estimated .......................................................................................... I-14 Capital Funds Budget Expenditure Schedule .................................................................................. I-15 Capital Projects Detail Schedule of Capital Projects by Category FY 2010-2011 to Buildout ............................... J-1 Fund Summary Capital Improvement Program Fund Summary ............................................................................ K-1 Glossary of Capital Project Funding Sources ............................................................................ K-15 CITY OF CARLSBAD, CALIFORNIA 2010-2011 BUDGET TABLE OF CONTENTS APPENDICES Planned Major Capital Outlay Items 2010-2011 ................................................................................ L-1 Out of State Travel Requests 2010-2011 .......................................................................................... L-2 Miscellaneous Statistical Information ................................................................................................ L-4 Accounting Systems and Budgetary Control ..................................................................................... L-5 Resolutions Adopting the Budget ...................................................................................................... L-6 Gann Limit Resolution ..................................................................................................................... L-19 Glossary.......................................................................................................................................... L-33 Acronyms ........................................................................................................................................ L-35 READER’S GUIDE TO THE BUDGET i This budget document has been designed to provide the public concise and readable information about the City of Carlsbad’s 2010-11 budget. The budget is separated into three major sections: the Overview, the Operating budget, and the Capital Improvement Program. Overview The beginning of the budget document contains the City Manager’s transmittal letter and overview information. The overview information will provide summary data to the reader for the Operating budget and the Capital Improvement Program, as well as information on personnel allocations and debt management issues. Operating Budget The Operating budget section has seven tabbed sections. The first section provides a summary of the operating budget and the remaining six sections provide detailed budget information for six main functional areas. The summary section begins with a budget overview, including revenue assumptions, information on the policies used to develop the budget, and an overview of expenditures. The overview is followed by tables providing detailed information on fund balances, revenues and expenditures. The following six sections are separated by functional area, which are Policy and Leadership Group, Internal Services, Community Development, Community Services, Public Safety, and Public Works. Within these broad categories, the budget is organized on a department, or program group, basis. Summaries, financial and descriptive, are included for departments containing more than one program. The summary page is followed by detailed information for each program. Some departments consist of one program only, and thus only one page is included for them. For each summary and program, a financial history and the 2010-11 budget figures are presented. If applicable, also included are narrative statements describing program activities, associated workload measures or performance objectives, key achievements for 2009-10 and key goals for 2010-11. Capital Improvement Program The Capital Improvement Program (CIP) is located in the back of the budget document. An overview of the CIP provides general information about the process used in preparing the budget for capital projects and describes how development information is used to project future revenues that fund these projects. In addition, major CIP projects are highlighted and discussed. The next section contains summary revenue and expenditure tables by funding source and a detailed project expenditure schedule listing the cost and timing of each future and current CIP project. Following this schedule are fund summary pages, which list the revenues and detail expenditures by fund, thus providing cash flow information and annual projected fund balances for each Capital Improvement Program fund. Appendices The Appendices contain a detailed listing of the 2010-11 Planned Major Capital Outlay items by department. An Out-of-State Travel Detail is presented next. The last section of the Appendices provides information on the Gann Limit, budget process, accounting system and budgetary control, the adopted Resolutions for the budget, and a glossary. ii Carlsbad . . .  Provides a diverse and healthy economic base that creates opportunities for employment to the residents of Carlsbad, economic vitality to the community, and the necessary revenues to support City services.  Provides programs, policies and decisions to implement the General Plan, enforce the Growth Management Plan, maintain the safety and security of its citizens, and are based on what is best for Carlsbad.  Occupies a leadership role in local and regional planning, (e.g., water, beach, circulation, and environmental issues) important to local governments actively involves addressing governmental issues at the local, state and national levels.  Provides an open government leading to the betterment of the community and encourages in a non-partisan manner active citizen participation and involvement with the City Council and the City’s Boards and Commissions. And Carlsbad Efficiently and Effectively…  Delivers top-quality public services.  Manages its environment proactively, including: Open space Wildlife habitats Water quality/conservation Beach preservation Air quality Resource conservation and waste reduction  Promotes a safe and efficient integrated transportation system.  Maintains citywide “small town” community spirit.  Provides a community where continuous and life-long learning is supported and encouraged for people of all ages.  Looks ahead and works to anticipate changes that are required now in order to make a better future for its citizens. Carlsbad City Council 2010 Five-Year Vision Statements City Council continues to clarify and pursue the vision of Carlsbad that reflects the pride and quality of life for all who live, work, and play here. ABOUT THE CITY OF CARLSBAD iii The City of Carlsbad is a unique coastal community located 35 miles north of the City of San Diego and surrounded by mountains, lagoons, and the Pacific Ocean. The City is governed by a five-member City Council under the Council/Manager form of government. Although the “village” dates back more than 100 years, Carlsbad incorporated in 1952 as a General Law city, and in 2008 became a Charter city. Currently, the City is over two-thirds developed and is expected to grow from a population of 106,804 to 117,000 once its 42 square miles are built out. Industries in the area include a major regional shopping center; a specialty outlet center; 20 auto dealers; 34 hotels offering over 3,600 rooms for tourist lodging; high technology, multimedia and biomedical businesses; electronics, golf apparel and equipment manufacturers; several business and light industry parks; and numerous land developers building single and multi-family housing in a variety of community settings. The City provides the full range of services normally associated with a municipality including police, fire, parks and recreation, library, planning and zoning, building and engineering, various maintenance services, and administration. The City provides water services through the Carlsbad Municipal Water District, a subsidiary district of the City. The City Council serves as the Board of Directors for the Carlsbad Municipal Water District. Solid waste collection is provided through a franchise agreement with a local refuse collection service. In addition to the usual City services, Carlsbad offers a wide variety of programs to help local residents and businesses. The City has a Redevelopment Agency with two active areas: the Village Redevelopment area that encompasses 0.4 square miles of the downtown area; and the South Carlsbad Coastal Redevelopment area, which is just south of the Village Redevelopment area and fronts the Pacific Ocean. The City’s Housing Authority administers federal housing assistance to 600 low-income Carlsbad families. Older Carlsbad residents receive assistance through the City’s senior citizen programs. School programs and facilities are provided by four different school districts located within the City boundaries. The City Council has no direct control over these school districts; however, the Council recognizes the importance of quality school facilities and programs to Carlsbad’s residents. Thus, the Council and staff work with the school districts on a regular basis. # # # # S a n F r a n c i s c o L o s A n g e l e s S a n D i e g o N e v a d a O r e g o n C a l i f o r n i a C a l i f o r n i a P a c i f i c O c e a n P a c i f i c O c e a n A r i z o n a C a r l s b a d C a r l s b a d CITY OF CARLSBAD BUDGET HIGHLIGHTS A-3 CITY OF CARLSBAD BUDGET HIGHLIGHTS FISCAL YEAR 2010-11 WHERE THE MONEY COMES FROM… ESTIMATED REVENUES $255.1 MILLION WHERE THE MONEY GOES… ADOPTED BUDGET $249.8 MILLION Taxes 38% Inter-Departmental 7% Licenses & Permits 1% Charges for Services 3% Income from Investments & Property 2% Inter-Governmental 5%Other 2%Utility Charges 20% Impact Fees/Special Taxes 22% Policy & Leadership 2%Internal Service 8% Public Safety 18% Capital Projects 24%Community Services 9% Comm. Dev. 7% Non Dept. & Contingency 4% Utilities 21% Public Works 7% CITY OF CARLSBAD BUDGET HIGHLIGHTS A-4 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 to 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 performances, 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. The City‘s budget is comprised of two pieces; the operating budget and the capital improvement program budget (CIP). The CIP provides the funds to build the parks, roads, buildings, and other infrastructure of the City while the operating budget provides the money to staff and operate the facilities and infrastructure as well as provide important services to the citizens and visitors of Carlsbad. The operating budget totals $188.3 million and is expected to generate $191.3 million in revenues. The CIP contains the current year budget allocation of $61.5 million and outlines approximately 250 future projects at a total cost of $447.8 million through buildout of the City. Capital revenues for Fiscal Year 2010-11 are estimated at $63.8 million. The capital projects include parks, civic facilities, as well as infrastructure needs anticipated for the future that are not expected to be constructed by developers. The budget overview on the following pages will provide the reader with a good understanding of the budget process and the economic profile of the City as well as with a broad overview of the services and projects planned for the 2010-11 Fiscal Year. This section also addresses debt management, including a schedule of the outstanding bond issues. More detail on the City‘s numerous programs and projects can be found throughout the remainder of the document. 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 finalize the overall City work plan, and the City Council approves a budget for the fiscal year. The Carlsbad City Council‘s annual goal setting process this year focused on supporting an excellent quality of life as the City transitions from a period of growth to a new era focusing on economic, CITY OF CARLSBAD BUDGET HIGHLIGHTS A-5 environmental and community sustainability. Maintaining core city services at their current levels is the top priority in developing the budget for the coming fiscal year. Other priorities focus on supporting the important values identified through Envision Carlsbad, a City-sponsored program to create a community vision for Carlsbad‘s future. Elements of this vision on are shown in the box on the previous page. 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 the resources, and sets the priorities for all of the programs offered by the City. Thus, it is an integral part of making Carlsbad a wonderful community in which to live, work and play. In addition, the budget is a fiscally conservative balanced budget, to effectively sustain the community and essential City services far into the future. ECONOMIC PROFILE The US economy continues to show moderate growth. According to the Bureau of Economic Analysis, real GDP increased 3.2% in the first quarter of 2010 after increasing 5.6% in the fourth quarter of 2009. It is expected that GDP will continue to grow at a 2%+ rate the remainder of the year. David Shulman at UCLA Anderson Forecast, indicates that the economy is suffering from a bipolar disorder. In the past where real GDP has expanded by 5% or more, payroll employment typically expanded by 2-3% annually. However the current situation shows a contraction of 1.3%. Many are calling this a jobless recovery. ―The sluggish growth in payrolls could be an unintended side effect of all of the economic medication coming for fiscal and monetary policy. Long-term hiring decisions are not generally based on temporary tax and spending programs. Nevertheless, the economy is now on a growth path and employment will soon be increasing albeit modestly.‖ The economy has lost 4 million jobs since the recession began in December 2007. It is forecasted that payroll employment will be two million jobs below the 2007 peak at the end of 2012. Consumer confidence sentiment declined to 72.2 in April 2010 down from 73.6 in March according to the Reuters/University of Michigan index. The index reached a thirty year low of 55.3 in November 2008. ―The April survey data indicates that consumers think the recovery is well underway, although most think it will be distressingly slow and have little immediate impact on their personal finances,‖ said Richard Curtin, chief economist of Thomas Reuters, University of Michigan. Shulman opines that the real risk to the economy is inflation. The Federal Reserve officials signaled the recovery isn‗t strong enough to stoke inflation, or justify an end to record-low interest rates. ―Although the economy is improving, employers are still reluctant to hire, homebuilding is ―depressed‖ and inflation will be subdued for some time‖, the Federal Open Market Committee said. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-6 California’s economy is growing, but very slowly. Despite the end of the recession, California‘s unemployment rate continues to rise, while local governments continue to shed jobs. The outlook for the balance of 2010 is for little or no growth in the state, with the economy picking up speed slightly by the beginning of next year. More normal growth rates for California should be in place by the middle of 2011. The keys to California‘s recovery are a growing demand for manufactured and agricultural goods from outside the state, the recovery of U.S. consumption, which increases the demand for Asian imports and for products from California‘s factories, increased public works construction and increased investment in business equipment and software. The UCLA Anderson Forecast calls for employment in 2010 to climb but not to exceed levels of 2009. Once employment growth returns in 2011, employment will begin to grow faster than the labor force at a 2.3% rate and the unemployment rate will begin to fall. Real personal income growth is forecast to be 1.3% in 2010 and 3.7% and 4.5% in 2011 and 2012 respectively. The unemployment rate – currently at 12.5% -- will fall slowly through the balance of this year and should average 11.8% for 2010. Though the state‘s economy will be growing, it won‘t be generating enough jobs to push the unemployment rate below double-digits until 2012. Locally, the San Diego economy appears to have ―settled down‖ and the outlook remains for positive but slow growth for the year ahead. If the local economy did not bottom out at the end of 2009, it likely did in the first part of 2010, according to several local economists, including University of San Diego (USD) economist Alan Gin. The total USD Index of Leading Economic Indicators for San Diego County for March 2010 is 109, which is up 8% from the March 2009 index of 100.7. This is the 12th straight month with an increase. Building permits, initial claims for unemployment insurance, and help wanted advertising were also positive, but to a lesser extent. The only down component was local consumer confidence, which fell slightly. Leading the way to the upside were strong moves in local stock prices and the outlook for the national economy. One potential problem is the budgetary difficulties faced by the State and by local governments. Due to requirements to have balanced budgets, state and local governments either have to raise taxes or cut jobs and spending or both, which makes a bad economic situation worse. Other things to keep a watch for are another wave of foreclosures due to the severe job losses in the local economy and weakness in commercial real estate, where a glut of retail and office space is putting pressure on commercial real estate owners and their lenders. The local unemployment rate remains at a high 11%, up from 10.7% in February 2010. Compared to the same period in 2009, residential units authorized were up almost 21 percent for the first quarter of 2010. According to Alan Gin, ―Although the end of the "Great Recession" has not yet been declared, there are signs that the national economy may already be on the rebound.‖ A chart reflecting USD‘s economic indicators is reflected above. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-7 Carlsbad’s economy is tied closely to that of the San Diego region. For FY 2009-10 property taxes are expected to decline by approximately 1.7% over the previous year. TOT, the City‘s gauge of the tourism industry, are expected to end FY 2009-10 showing a 8.9% decrease, and sales taxes are expected to end FY 2009-10 with a decline of 10.9% due to the slow economy especially the decline in auto sales. Overall the City is anticipated to end FY 2009-10 with a 1% decline or $1 million less in General Fund revenue compared to FY 2008-09. Carlsbad‘s residential real estate market slowed significantly throughout FY 2008-09 but it has picked up in 2009-10. For FY 2008-09, the City issued 107 dwelling units as compared to 339 dwelling units for FY 2007-08. For 2009-10, the City is projecting it will issue 265 dwelling units. For industrial and commercial, the City has permitted 109,149 square feet for FY 2009-10 through April 2010, compared to 237,935 square feet for FY 2008-09 for the same time frame. Development has picked up recently due to a number of new residential communities under construction or in the final phases of development that will add to the residential housing stock in Carlsbad. The Villages of La Costa projects known as the Oaks North, the Greens and the Ridge are nearing completion, with the final phases under construction. In addition, the Robertson Ranch area East and West Villages, which is expected to contain a little over 1,100 residential units, has began to pull building permits for 3 communities in the East Village. The completion of these master planned communities will signal an end of the larger-scale residential development in Carlsbad. As the housing market cooled, the housing prices declined as well. However, we are now starting to see a slight increase in housing prices. The median price for single-family homes in Carlsbad was $681,000 for March 2010, an increase of 6.6% from the previous year. The total assessed values in the City stand at over $21 billion; an increase of nearly 50% over what they were just five years ago. The City is projecting it will add about 1,088 more residential units and an additional 1.5 million square feet of commercial/industrial development over the next five years. The City‘s residential housing stock is about 90% built out, with approximately 4,850 housing units remaining to develop. Prior to the downturn of the economy in 2007, commercial and industrial development had been averaging 1,129,000 square feet per year over the five years prior to that. Due to the economic recession, commercial and industrial development now is expected to average 300,000 square feet per year over the next five years with the large industrial commercial developments including Bressi Ranch, Carlsbad Raceway and Palomar Forum, Dos Colinas Retirement Community, Paseo Carlsbad Retail and Restaurants and the desalination plant. Some of the major companies in town include Callaway Golf, the Gemological Institute of America, ViaSat, Life Technologies, TaylorMade-adidas Golf, Upper Deck, and many others. 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. $0 $100 $200 $300 $400 $500 $600 $700 $800 2003 2004 2005 2006 2007 2008 2009 2010 Fiscal Year Median SFD Home Prices Thousands CITY OF CARLSBAD BUDGET HIGHLIGHTS A-8 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 Four Seasons Resort 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 Sheraton Carlsbad Resort and Spa, Homewood Suites and Hampton Inn. 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. 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 of the 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 money 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. Even with the economic slowdown, Carlsbad‘s current economic position is an enviable one. A relatively healthy and well diverse local economy over the past ten years provided additional revenue- generating sites that allowed the City to continue to add new facilities and services for the citizens. The City hosts three regional shopping areas within its boundaries; a large regional mall, an outlet center, and a high-end retail center in the southern part of town called The Forum. Together, these sites contribute approximately $4.3 million annually to the City‘s sales taxes. The City‘s Auto Mall 0 20 40 60 80 100 2003 2005 2007 2009e 2011e$ MillionsFiscal Year General Fund Revenues (Top 5) Other Franchise SDG&E Franchise TOT CITY OF CARLSBAD BUDGET HIGHLIGHTS A-9 generates another $4 million per year in sales taxes for the City. Legoland, a family theme park, contributes to the City‘s sales tax base and stimulates tourism in the area which contributes to the TOT. The effect of the new development and the demand for housing in Carlsbad is an increasing tax base. The four major revenue sources for the City: property taxes, sales taxes, transient occupancy taxes (TOT), and franchise taxes, are expected to provide $88.6 million, or 80%, of the City‘s General Fund revenues in FY 2010-11. These taxes and fees are the major source of funding for most of the City‘s services, and allow the City to live up to its reputation as one of the premier locations in San Diego County. Overall, for FY 2010-11, the General Fund revenue is projected to decline by 3.9% from the previous year‘s estimates. Most of the tax revenue, with the exception of property taxes, are expected to increase slightly in 2010-11. Sales tax and TOT are both projected to increase around 3% due to the upward trend we see in the economy. Due to the decline in housing values, the County Assessor has estimated that the City should expect property tax revenues to decrease by almost 1.7% for FY 2010-11. New building permits are expected to increase slightly and the development related revenue items have been adjusted accordingly for Fiscal Year 2010-11. More information on all of the City‘s revenues and programs can be found in the later sections of the document. State of California – In January, California, like the rest of the nation, was slowly emerging from the most severe economic downturn since the Great Depression, and faced a significant budgetary imbalance. The State of California has been in a severe fiscal crisis for a number of years. Through a variety of loans, one-time revenues, interfund borrowings, and raids on city, county and special district funds, it has been able to manage its cash flows and stay solvent. Federal and state maintenance-of-effort requirements and other legal constraints have also increased costs and substantially restricted the areas of the Budget that can be reduced. As a result, the state‘s choices are more limited and more difficult. The Governor‘s May Revise Budget has been released for FY 2010-11. In May 2010, the State reported the budget deficit will be $19.1 billion, $7.7 billion from the 2009-10 Fiscal Year, $10.2 billion from the 2010-11 Fiscal Year and a modest reserve of $1.2 billion. The Governor has proposed $12.4 billion in deep cuts to State programs and services including child care programs, CaliWORKS program and mental health programs. The rest of the funds will come from federal funds. Proposed federal funds include $1.7 billion from the extension of the temporary increase in the Federal Medical Assistance Percentage (FMAP), $125 million from the extension of other enhanced federal funding provided under the American Recovery and Reinvestment Act, and $1.6 billion in additional federal funds for health and human services and for the Department of Corrections and Rehabilitation. There are no additional hits to transportation and transit or borrowing from local governments in the Governor‘s proposal. The Governor did not propose to take more from local redevelopment agencies than what was already included in AB X4 26. As a result of previous attacks on cities‘ revenues, a coalition of cities, counties and special districts supported Proposition 1A which was approved by the voters in November 2004. The measure included a provision to help prevent the Legislature from reducing the combined property tax shares of cities, special districts, and the county, except to borrow the funds on a temporary basis to address a ―severe state fiscal hardship.‖ According to Proposition 1A, if the State borrows funds from local governments, the State is required to pay back the funds within three years including interest. The State can only borrow two times within a 10 year period and is required to pay back the first loan before another borrowing can occur. There is also a statewide ballot measure aimed for the November 2010 election that would protect funding for local public safety, emergency response, transportation, transit and other vital local services. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-10 Looking Forward As stated earlier in this document, the City prepares ten-year forecasts for the General Fund each year in order to understand the effects of actions taken today on the City‘s future. The City has experienced remarkable revenue growth over the past ten years due to the development of the majority of its commercial sites. For example, as the City was preparing its ten-year forecast in FY 2006-07, it appeared that General Fund revenues were going to continue on a path of strong annual growth. Therefore, projected expenditures in the General Fund at that time were also projected to grow at essentially the same rate. The upper line on the graph below reflects the projected growth in General Fund revenues as originally projected in the ten- year forecast back in FY 2006-07. The lower line on the chart reflects the projected General Fund revenues as currently projected in the FY 2010-11 ten-year forecast. The difference between the two lines indicates the potential deficit the City would have experienced in the General Fund if changes had not been made during the past four fiscal years. Continuously monitoring and updating the ten-year forecast provides an early warning for staff and allows adjustments to be made along the way, avoiding major surprises. This tool enabled the City to anticipate the current recession and make changes along the way to avoid having these potential deficits. 100,000 110,000 120,000 130,000 140,000 150,000 160,000 170,000 180,000 190,000 200,000 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Dollars (In Thousands)Fiscal Years PROJECTED EXPENDITURES (2007 FORECAST) VS. PROJECTED REVENUES (2011 FORECAST) Proj. Exp. (2007)Proj. Rev. (2011) ($24,048) ($26,368) ($31,157) ($29,507) ($33,480) ($32,722) ($31,521)($33,232) ($33,911) ($35,702) CITY OF CARLSBAD BUDGET HIGHLIGHTS A-11 Over the past several fiscal years, changes were made to the City‘s annual budget in anticipation of the economic recession to ensure that the General Fund would have a balanced budget on an annual basis. Some of these changes included the elimination and/or keeping vacant certain positions, delaying the construction of non-essential capital projects while continuing to invest in infrastructure, reducing the funding for capital outlay and goal projects, reducing and/or eliminating cost of living salary increases, using technology and other tools to create efficiencies, and reducing certain non-essential service levels with a minimal impact to the community. The ability to understand both changes in revenue sources as well as program needs into the future is crucial to ensure that the City has the funds available to realize its future plans. The General Fund forecast is a tool available to the City to achieve the goal of managing its fiscal resources effectively and monitoring the achievement of sustainable economic health for the City of Carlsbad into the future. When there is economic uncertainty, this long-term perspective becomes even more important. Currently, the economic uncertainty has created a forecast with much smaller surpluses projected than in the recent past and in a few years, projected deficits. The future will bring a few more commercial sites but at a much slower pace, especially in the next few years, due to the economy. Until the housing and employment crisis can recover, it is anticipated that residential development will continue at a slower pace. There are also quite a few City facilities – mainly parks and civic facilities – planned in the future to serve the growing population. The new facilities will add operating costs to the City‘s General Fund budget as they are completed and opened for use. The timing of opening these facilities has been reviewed to ensure that the facilities are opened during a time when the General Fund can support these additional operating costs. These new facility operating costs have been incorporated into the General Fund forecast shown below and projected over the next ten years. The emphasis will continue to be maintaining existing infrastructure. New civic facilities will be planned when there is anticipated financial capacity to operate and maintain those new facilities when they are opened. While no forecast is ever totally accurate, it does represent a likely scenario given the assumptions on which it is built. - 20 40 60 80 100 120 140 160 180 $ MillionsFiscal Year General Fund Revenues and Expenditures Revenues Expenditures CITY OF CARLSBAD BUDGET HIGHLIGHTS A-12 The forecast assumes that ongoing revenue (excluding one-time revenues received in FY 2009- 10) will begin to turn positive in FY 2010-11, although at a very moderate rate, assuming that the economy does not go into a double-dip recession. To project the expenditures, it includes all known personnel costs. However, the City is currently in negotiations with its Fire and Police associations, and the results of those negotiations have not been reflected in the current ten- year forecast. The forecast assumes 10% annual increases in health care costs in the near future with the employees paying half of those increases. In also assumes no personnel growth (new positions) until FY 2012-13. Negotiated salary step increase and cost of living increases between 0.5% and 3.5% have been added to personnel costs. In order to help maintain a balanced ten-year forecast, position growth has been limited. Pension plan costs are anticipated to increase by approximately 5% for miscellaneous employees and 7.5% for safety employees in FY 2011-12 as a result of the significant investment losses CalPERS sustained in FY 2008-09. It assumes that the contribution from the General Fund to the Infrastructure Replacement Fund is 6.5% of General Fund revenues. And finally, it includes estimated operating costs for all capital projects in the timeframes shown in the Capital Improvement Program (CIP). One of the significant assumptions in the forecast is that the recession, if it has not already, will bottom out during 2010, with modest growth during the economic recovery. The results show that while the General Fund is balanced for FY 2010-11, there are small projected deficits projected for the following three years due predominantly to the increase in the projected PERS rates. One-time transfers are currently programmed in the forecast in the event that these deficits materialize in these years. Additional budget solutions will be pursued to help balance those years as well. In addition, for the years that appear to be balanced, there are much smaller surpluses than in previous years‘ forecasts. This reflects the current economic recession and uncertainty. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-13 2010-11 OPERATING REVENUES BY FUND TYPE $191.3 MILLION OPERATING BUDGET Revenue Projections by Fund The City’s operations are divided into various funds. Each fund has been established because of certain restrictions placed on the use of the resources received by that fund. Any unrestricted funds are placed in the General Fund. Estimated revenues for the City’s five fund types are shown on the accompanying graph. General Fund The fund receiving the largest slice of the revenues is the General Fund, with estimated revenues of $110.4 million for Fiscal Year 2010-11. The General Fund pays for most of the City services available to City residents. The majority of the General Fund revenues (8%) are derived from taxes. The following graph illustrates the sources of revenue to the General Fund. Property taxes, at $48.7 million, are the largest General Fund revenue. The City receives only about 18% of the property taxes paid by its citizens. The remainder of the tax goes to the school districts, the state, and other various agencies. PROPERTY TAX 43% TRANSFER TAXES 1% SALES TAX 21% BUS LIC TAX 3% LICENSES & PERMITS 1% CHARGES FOR SERVICES 6% OTHER REVENUE 4% INTERGOVERNMEN TAL 2% FRANCHISE TAX 5% TRANSIENT TAX 11% INC. FROM INVEST & PROP 3% 2010-11 GENERAL FUND REVENUES $110.4 MILLION CITY OF CARLSBAD BUDGET HIGHLIGHTS A-14 Sales tax is the second largest source of revenue for the General Fund. Sales taxes are estimated to bring in $22.9 million for Fiscal Year 2010-11. Automobile and retail sales are the most significant contributors to the category of sales tax. Transient occupancy taxes (hotel taxes) are estimated at $12 million and are the third largest revenue source for the City. Franchise taxes, transfer taxes, and business license taxes make up the remaining $9.2 million in tax revenues estimated to be collected in Fiscal Year 2010-11. Intergovernmental revenues are revenues collected by the State and other governmental agencies and allocated to the City based on a formula. Examples of intergovernmental revenues include motor vehicle license fees, State mandated cost reimbursements, and homeowner’s exemptions. Intergovernmental revenues are estimated at $1.7 million for the upcoming year. Licenses and permits account for $1.4 million of the General Fund revenues and include building permits and other development-related permits. Charges for services are estimated to be $6.6 million and include fees for engineering, planning, building, recreation, and ambulance services. Income from investments and property are estimated at $2.9 million. Other General Fund revenue sources include charges collected from other departments, fines and forfeitures, and miscellaneous revenues. Those sources total $4.9 million Special Revenue Funds Revenues from Special Revenue funds are estimated at $10.9 million for Fiscal Year 2010-11. Funds collected in this category are legally restricted to specified purposes. Examples of funding resources include donations, grants, and special assessments. The types of functions supported with Special Revenue funds include programs such as Section 8 Housing Assistance, Housing Trust Fund, Community Development Block Grants (CDBG), and maintenance and assessment districts. Enterprise Funds Enterprise funds revenues make up the second largest revenue group, totaling $50.2 million. Enterprise funds operate similar to a business in that they charge fees to cover the cost of their services. Examples of the City’s enterprises include water and wastewater services and solid waste management. Internal Service Funds Internal Service fund revenues, projected to be $16.3 million, are derived from charges to the City programs that benefit from the services rendered. The funds collected must be used specifically to support the internal service. Examples of the City’s Internal Service funds include Liability, Health Insurance, Information Technology, Workers’ Compensation, and Vehicle Maintenance and Replacement. Redevelopment Agency Redevelopment Agency revenues, estimated at $3.4 million, come mainly from property taxes collected within the redevelopment area. Carlsbad has two redevelopment areas. The original area consists of 204 acres located in the downtown “Village Area” of the City. The second area encompasses the land on which the Encina power plant is located as well as additional parcels south of the plant. Funds collected within the redevelopment areas must be used to repay the debt incurred and administration of the Agency. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-15 OPERATING BUDGET BY PROGRAM The total operating budget for the City for Fiscal Year 2010-11 equals $188.3 million, which is approximately 1.4% less than the FY 2009-10 adopted budget. The changes in each of the City’s programs will be discussed below. The operating budget is categorized by main functional area. Six functional areas that represent the key businesses of the City have been identified. The graph on the following page shows the operating budget for each of the functional areas. Total funding allocated for the Policy and Leadership Group for 2010-11 is $5.6 million. This group encompasses all elected officials and the chief executive offices for the City. These include the offices of the City Council, City Manager, City Clerk, City Attorney, and City Treasurer, as well as the communications and records management functions. Internal Services, with a budget of $26 million, includes finance, purchasing, human resources, information technology, property and environmental management, fleet maintenance and replacement, self insured benefits, risk management, and workers’ compensation. These areas mainly provide services to internal City departments. Public Safety services are funded at $44.5 million and include all of the police and fire programs such as police patrol, vice/narcotics, juvenile diversion and DARE programs, fire emergency operations, fire prevention and emergency preparedness. Community Development, with a budget of $17.7 million, provides the services that guide and oversee the planning and development of Carlsbad as depicted in the City's General Plan. The General Plan is the base document that expresses the goals and public policy relative to future land use. It acts as a "constitution" for development and is the foundation upon which all land use decisions are based. Also included under Community Development are building and code enforcement, volunteer programs, neighborhood services, and housing and redevelopment programs. Policy/ Leadership 3%Internal Services 14% Public Safety 24% Non-Departmental 5% Community Services 13% Community Development 9% Public Works 32% 2010-11 OPERATING EXPENDITURES $188.3 MILLION CITY OF CARLSBAD BUDGET HIGHLIGHTS A-16 Community Services, with a budget of $24.3 million, is made up of the library, parks and recreation, cultural arts, and seniors programs. These programs are provided to a wide range of people and assist in their education and cultural development. The functional area requiring the largest amount of funds is Public Works, with a budget of $60.8 million. Public Works is responsible for the building and maintenance of all of the City’s streets and roadways, and for the provision of utility services. It is comprised of the transportation department, lighting and landscaping districts, as well as utilities services, such as the water, sewer, and solid waste enterprise funds. The Non-Departmental and Contingency accounts total $9.2 million and include programs benefiting the City as a whole, such as community promotions, community contributions, assessment services, transfers to other funds, and the City Council’s contingency account. Included in the non-departmental group is a $7.1 million transfer to the Infrastructure Replacement Fund. This program sets aside funds for the replacement of the City’s base infrastructure. The contingency account, which is available to the City Council for emergencies and unforeseen program needs that arise during the year, is budgeted at $500,000. The contingency account amounts to less than 0.5% of the FY 2010-11 General Fund budget. STAFFING The FY 2010-11 Operating budget reflects a total decrease of 13.75 full-time positions and 3.5 limited term positions. The net increase in hourly staff totaled approximately .50 of part-time staff. These changes result in a City workforce of 699 full and three-quarter time employees and 138.94 hourly FTE, although 6 of the full-time positions are not funded in the FY 2010-11 budget. The staffing changes in each of the City’s programs are discussed more fully in the Operating Budget Overview. CAPITAL IMPROVEMENT PROGRAM The City of Carlsbad’s Capital Improvement Program (CIP) is a long-range planning document, which outlines the expenditure plan for current and future capital projects and the corresponding revenues to pay for those expenditures. Projects in the CIP consist primarily of new construction or major maintenance and replacement of City facilities such as parks, roads, civic facilities such as libraries, police and fire stations, and sewer, water, and drainage facilities. The Capital Improvement Program for 2010-11 totals $61.5 million in new appropriations and an estimated $176.7 million in continuing appropriations, for a total appropriation of $238.2 million. The City’s Capital Projects are discussed more fully in the Capital Improvement Program section. Some of the notable capital projects include the following: Park Development Projects Alga Norte Park and Aquatic Center – This park site consists of 30 acres in the Southeast Quadrant with planned amenities that include ball fields, soccer fields, picnic areas, tot lots, a skate park, a dog park, restrooms, parking facilities, and an aquatic center. The aquatic center is planned to include a 55- meter competition pool, a 12-lane instructional pool and a therapy pool as well as a water play area for toddlers. A swimming pool complex was one of the projects approved by the voters through Proposition C in 2002. The rough grading for the park site is scheduled to be completed during the summer of 2010 to facilitate construction of the park at a later date. The total cost of the park and aquatic center is currently budgeted at $50.4 million. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-17 Leo Carrillo Barn – Phase III of this historic park facility includes transformation of the existing barn into a community theatre. The total is budget is $500,000. The project is expected to be complete in the Spring of 2011. In addition, Phase III includes the renovation of additional buildings, construction of additional restrooms and an arboretum area. The total cost of the remainder of Phase III is approximately $1.9 million and design is expected to begin in FY 2013-14. Civic Projects The Public Works Center – The city has planned the construction of a Public Works Center to bring together many of the maintenance functions to a single facility for a number of years. In 2010, the City Council took action to purchase 3.08 gross acres of land with an existing 5,400 square foot industrial building on site. This property is adjacent to an existing city facility, a 5.8 gross acres site located on Las Palmas Drive. In the coming year, staff will develop updated estimates and plans to locate offices, shops, a yard, warehouse and parking to accommodate the city’s maintenance personnel. The total cost of the project is approximately $28.1 million. The Joint First Responders Training Facility was authorized under Proposition C, which was approved in 2002. The contract for this facility has been awarded, and construction began in June 2010. The facility is being constructed on a site at the Carlsbad Safety Center adjacent to Fire Station No. 5 with a total project budget of $24.5 million. Plans for this facility include a 25-yard and 100-yard shooting range, a 4-story fire training tower, and a 2-story residential training facility. The Relocation of Fire Station No. 3, which is currently located at the corner of Chestnut and Catalina, is needed to help ensure a five-minute response time as the City grows eastward. The site for the new station is in Robertson Ranch. Total cost is projected at $9.2 million. Street Projects The Carlsbad Boulevard Realignment – This project has been identified as one of the City Council’s top priorities for the coming year. The FY 2010-11 CIP includes an appropriation of $3.0 million for preliminary engineering and environmental studies to analyze roadway realignment alternatives, infrastructure needs, land uses, commercial land development options, public park and coastal access opportunities and related long-term coastal planning issues and constraints. Traffic Management Center and ATMS – In keeping with City Council’s goal of improving traffic flow throughout the city, a project to develop an Automated Traffic Management System (ATMS) and a Traffic Management Center has been added to the CIP program. A pilot study is currently being conducted to test the effectiveness of the proposed system. Once the study is complete the system will be expanded to incorporate key locations throughout the city. A total of $912,000 has been included in the CIP with a $203,000 appropriation in FY 2010-11. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-18 The Pavement Management Program helps ensure that Carlsbad’s local streets are maintained on a regular cycle to ensure a good riding surface and to extend the life of the street. Part of the maintenance program is the sealing and overlay of the existing street surface. In addition, any problem areas are addressed as they are identified. The FY 2010-11 CIP has $2.7 million budgeted for this program. Poinsettia Lane Reach E is a project which includes completion of the final link along Poinsettia Lane between Cassia Road east to Skimmer Court. The total cost is approximately $13.5 million and the City expects to begin the design in FY 2013-14. Sewer, Water, and Drainage Facility Projects Vista/Carlsbad Interceptor and Aqua Hedionda Lift Station Replacement – This project consists of a set of individual projects that will ultimately construct a parallel sewer interceptor system to accommodate existing and future sewer flows from the cities of Vista and Carlsbad. The individual projects include a main in Jefferson Street, replacement of the Aqua Hedionda Lift Station, and a main from the lift station to the Encina Wastewater Facility. The overall total cost estimate for this set of projects totals $48.8 million, of which $15.3 million is to be funded by the City of Carlsbad, with the remainder of $33.5 million to be funded by the City of Vista. Major wastewater facilities scheduled for construction or replacement within the next five years include: - Buena Interceptor Sewer Improvements - Home Plant Lift Station Replacement and Forcemain - Buena Vista Lift Station Improvements The Maerkle Reservoir Storage project is for the construction of a buried 16 million gallon water storage reservoir next to the existing reservoir in order to provide additional emergency storage and to meet the 10-day storage criteria based on ultimate demands. The total cost is estimated at $14.8 million. The Hydroelectric Pressure Reducing Station project at the Maerkle Reservoir is an electricity generating project that will provide a renewable energy source for the City. The cost estimate for this project is approximately $2.0 million. Several major water lines are scheduled for construction within the next five years: - Carlsbad Boulevard – south of Avenida Encinas - Maerkle Transmission Main - Tri-Agencies Water Transmission Pipeline Replacement - Reservoir Repair/Maintenance Program - Palomar Business Park Recycled Water Pipelines Aqua Hedionda Channel – the project included dredging approximately 30,000 cubic yards of accumulated sediment from the Aqua Hedionda and Calavera Creek Channels adjacent to the Rancho Carlsbad Community. Current cost estimates have been updated to include the need to acquire and restore 5.6 acres of wetland mitigation. The total estimated cost of the project is $5.2 million. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-19 DEBT MANAGEMENT ISSUES The use of debt has always been a primary issue in the development of the Capital Improvement Program and the policies to implement the Growth Management Program. Over the years, the City has issued millions of dollars of bonds and Certificates of Participation (COPs) to fund streets, buildings, sewer and water facilities, open space acquisitions, and other infrastructure projects. The City is continually evaluating its outstanding debt as well as potential future issues to ensure that interest costs are kept at a minimum and the use of the bond funds is appropriate. During fiscal year 2008-09, the City’s General Fund paid off the remaining balance of the $6.6 million debt issued in 1997 for Hosp Grove Refunding, Certificates of Participation. Prior to the retirement of this debt, average annual debt service payments for the General Fund were approximately $750,000. For Fiscal Year 2009-10, no debt service payments will be required of the General Fund. Of the approximately $129 million of debt currently outstanding, none will be paid back using General Fund monies. Rather, the debts will be repaid from sewer revenues, golf course revenues and from property owners benefiting from the improvements built with bond proceeds. The City has no obligation to advance funds to the assessment districts if the property owners do not pay. The table following the Summary identifies the debt the City has issued, the outstanding principal, the 2010-11 principal and interest payments, and the scheduled fiscal year of payoff. SUMMARY The FY 2010-11 budget was developed with an emphasis on sustaining core city services at their current levels while maintaining expenditures that are in line with anticipated revenues. While the City of Carlsbad has a diverse economic base, it is not immune to the weak economy. Although Carlsbad has not been as negatively impacted as other parts of the state and nation, the ongoing recession has had a significant effect on city finances over the last few years. Operating revenues have decreased by about $10 million, or 8%, their peak in FY 2007-08, resulting in a decline in the amount available to spend on the operations of the city. By planning ahead, the city was able to meet this challenge by making reductions to its operating budget over the last two years, avoiding major changes in the FY 2010-11 budget. National, state, and local economies are beginning to show growth once again, but at a very slow rate. Unemployment levels remain high, creating concern about the economic outlook for the next few years. Given this current economic uncertainty, the City has developed a balanced budget for FY 2010-11 with no growth, but with minimal impact on the provision of core City services to the citizens and visitors of Carlsbad. There are no new programs, services or positions being added this year. The City of Carlsbad continues to be a fiscally conservative and responsible city. Long-term planning and foresight by the City Council and residents have provided a sound economic base for the City to positively weather the current changes in the economic environment. The ten year forecast continues to be an important tool for the City to help project changes in revenue in order to adjust expenditures accordingly. The challenges for the future will be about managing costs while continuing to look for appropriate revenue streams sufficient to pay for the quality services desired by those who live, work and play in Carlsbad. CITY OF CARLSBAD BUDGET HIGHLIGHTS A-20 The following table identifies the debt the City has issued, the outstanding principal balance, the 2010-11 scheduled principal and interest payments, and the scheduled year of payoff. Bond Name Repayment Source Original Bond Issue Outstanding Principal At 6/30/10 2010-11 Payment P&I Final Payment FY Carlsbad Public Financing Authority Bonds Revenue Bonds Golf Course 18,540,000$ 17,975,000$ 1,103,350$ 2037 Enterprise Revenue 1997 Hosp Grove Refunding Certificates of General Fund 6,595,000$ $ -0-$ -0-PAID Participation 1996 Refunding Encina JPA Tax Allocation Sewer Enterprise 11,080,000$ 4,105,000$ 931,419$ 2015 Bonds Revenue 1993 Redevelopment Tax Allocation Redevelopment 15,495,000$ 10,250,000$ 1,041,459$ 2024 Bonds CFD #3 2006 -Improvement Area 1 Special Tax Special District 11,490,000$ 10,945,000$ 762,723$ 2037 Bonds CFD #3 2008-Improvement Area 2 Special Tax Special District 18,175,000$ 17,970,000$ 1,270,573$ 2039 Bonds Subtotals 81,375,000$ 61,245,000$ 5,109,524$ 2005 Poinsettia Lane East (AD 2002-1) Limited Obligation Assessment 33,085,000$ 30,680,000$ 2,138,777$ 2036 Improvement Bonds District 2003 College Boulevard-Cannon Road (AD 2003-1) Limited Obligation Assessment 11,760,000$ 10,815,000$ 834,360$ 2035 Improvement Bonds District 1997 Reassessment District ( ReAd 1997-1) (College & Alga)Assessment 18,475,000$ $ -0-$ -0-PAID Limited Obligation District Improvement Bonds 1997 Carlsbad Ranch (AD 95-1) Limited Obligation Assessment 10,175,438$ 6,385,000$ 692,875$ 2023 Improvement Bonds District 1998 Rancho Carrillo (AD 96-1) Limited Obligation Assessment 19,600,000$ 14,580,000$ 1,245,500$ 2029 Improvement Bonds District Subtotals 93,095,438$ 62,460,000$ 4,911,512$ Totals 174,470,438$ 123,705,000$ 10,021,036$ City of Carlsbad Debt Outstanding 2010-11 BUDGET CALENDAR A-23 DECEMBER JANUARY FEBRUARY MARCH MAY JUNE Capital Improvement Program (CIP) Kickoff Meeting Set budget policies Request Capital Project submittals Operating revenue is projected for the General fund Operating budget manual is distributed to departments Budget preparer’s meeting Departments submit CIP requests to Engineering Growth projections completed CIP analysis Draft CIP is submitted to department heads Tentative LT meeting to provide status on CIP Departments submit operating budget requests to Finance Leadership Team (LT) reviews CIP Finance department analyzes and compiles the operating budget submittals LT reviews operating budget Meeting with LT – Final CIP Review Preliminary operating budget is sent to the printer CIP Budget Workshop: May 11 Council meeting Operating Budget Workshop: June 8 Council meeting Citizens Budget Workshop: June 10 Council adopts final budget including: Operating budget, Capital Improvement Program, and Annual Spending Limitation: June 29 Council meeting Operating Budget * CIP APRIL Operating Budget Operating Budget Operating Budget Summary Summary 2010-11 OPERATING BUDGET OVERVIEW B-1 The Operating Budget for Fiscal Year 2010-11 totals $188.3 million, with revenues for the year estimated at $191.3 million. General Fund revenues are estimated at $110.4 million and General Fund budgeted expenditures are $109.4 million. REVENUE The following table shows the total operating revenues the City anticipates receiving for FY 2009-10, as well as those estimated for FY 2010-11. PROJECTED ESTIMATED $% 2009-10 2010-11 CHANGE CHANGE GENERAL FUND 114.8$ 110.4$ (4.4)$ -3.8% SPECIAL REVENUE 12.8 10.9 (1.9) -14.8% ENTERPRISE 47.0 50.3 3.3 7.0% INTERNAL SERVICE 14.9 16.3 1.4 9.4% REDEVELOPMENT 3.5 3.4 (0.1) -2.9% TOTAL 193.0$ 191.3$ (1.7)$ -0.9% FUND REVENUE SUMMARY BY FUND TYPE (in Millions) Revenue estimates for the Operating Budget indicate that the City will receive a total of $191.3 million, a 0.9% decrease over the prior year’s projections. The significant changes from the prior year are comprised of a $3.3 million increase in the Enterprise Funds due to the proposed water and wastewater rate increases. The General Fund shows a decrease of $4.4 million due to a sale of City property to the Village Redevelopment Area in 2009-10. 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 table below shows a summarized outlook for the major General Fund revenues. PROJECTED ESTIMATED $% FUND 2009-10 2010-11 CHANGE CHANGE PROPERTY TAX 49.6$ 48.7$ (0.9)$ -1.8% SALES TAX 22.1 22.9 0.8 3.6% TRANSIENT OCC. TAX 11.6 12.0 0.4 3.5% FRANCHISE TAXES 4.9 5.0 0.1 2.0% BUSINESS LICENSE TAX 3.4 3.5 0.1 2.9% DEVELOPMENT REVENUES 2.2 2.4 0.2 9.1% ALL OTHER REVENUE 21.0 15.9 (5.1) -24.3% TOTAL 114.8$ 110.4$ (4.4)$ -3.9% SIGNIFICANT GENERAL FUND REVENUES (In Millions) 2010-11 OPERATING BUDGET OVERVIEW B-2 As we enter into a slow recovery from the economic recession discussed in the Budget Overview section, we are starting to see slight increases in most of the General Fund revenues. Several of the largest revenue sources in the General Fund are impacted by fluctuations in the economy. In addition, the housing crisis has not only impacted property taxes, it has also affected sales taxes, transient occupancy taxes and development related revenues. This upcoming fiscal year it is expected that property taxes will be approximately $48.7 million, a 1.8% decrease over the projection for FY 2009-10. This is based on a 1.8% estimated decrease in assessed valuation as provided by the County Assessor in May 2010. The median price for resales in Carlsbad is currently $681,000 which is up 6% over the same time a year ago, this could be an indication that residential home values have stabilized. Property taxes tend to lag behind the rest of the economy, as the tax for the upcoming fiscal year is based on assessed values from the previous January. Thus, the taxes to be received for Fiscal Year 2010-11 are based on values as of January 1, 2010. Sales taxes react much quicker to changes in the economy and therefore will typically grow faster in a good economy, but also drop off faster as the economy cools. Property taxes also have a cap on how fast they can grow. This is due to Proposition 13. Proposition 13 was adopted by the State in 1978. This proposition limits the growth in assessed values (and thus property taxes) to no more than 2% 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 years, we have seen a robust growth in property taxes due to new developments, a large number of resales within the City spurring revaluation of the parcels, and double-digit growth in housing prices. Sales taxes are expected to total $22.9 million for FY 2010-11, an increase of 3.6% compared to the FY 2009-10 projections. The City of Carlsbad has many car dealerships which historically have generated approximately $6.0 million of sales tax each year. Car sales have slowed since FY 2008-09 but started to show slight gains in the 4th quarter of 2009 resulting in annual car sales projections of approximately $4.0 million for FY 2010-11. In recent months, many national car manufacturers have seen double-digit growth partially due to the General Retail 41% Food Products 15% Transportation 27% Construction 2% Business to Business 14% Miscellaneous 1% Sales Tax by Category Fourth Quarter 2009 2010-11 OPERATING BUDGET OVERVIEW B-3 incentives they have offered to lure customers as well as pent up demand. Although the City does not expect to see this type of growth in sales tax revenues from car sales, it is anticipated that this growth is a sign that the economic recovery may be starting. In addition, retail comprises over 41% of the sales tax generated in Carlsbad and with a slow economy, it is anticipated there will be less discretionary purchases as compared to several years ago. As consumer confidence increases during the recovery, the City’s sales tax revenues are projected to gradually increase. Included in the projected sales tax figures for FY 2010-11 is the opening of Paseo Carlsbad and new retail outlets in Bressi Ranch. Several years ago, the State of California implemented the “Triple Flip.” The “Triple Flip” is essentially a temporary swap of a ¼ 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 on the previous page, the City’s sales tax base is heavily weighted in the transportation (predominantly new car sales) and retail sectors. These two sectors make up approximately 68% of the City’s sales tax base and have been negatively impacted by the economic recession. As the economic recovery takes hold, sales tax revenues will be one of the first sources of City revenue to see an increase. Sales tax estimates also include approximately $700,000 that is restricted to spending on public safety services under Proposition 172. Proposition 172 requires that the ½ cent increase in California sales taxes be allocated to local agencies, to fund public safety services. The third highest General Fund revenue source is Transient Occupancy Taxes (TOT or hotel taxes) estimated at $12 million for FY 2010-11, an increase of 3.5% compared to FY 2009-10 estimates. It is anticipated that there will be slight increases in occupancy and average daily rate in FY 2010-11 which combined will result in an overall increase from FY 2009- 10. However, group sales are still struggling as corporations spend less on meetings and conferences. This will impact the higher end hotels which are still predicted to show decreases over the prior year. 2010-11 OPERATING BUDGET OVERVIEW B-4 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 and changes in their rate structures. Franchise revenues are projected to increase by 2.0% primarily due to the franchise taxes on gas and electric services, which are paid by San Diego Gas and Electric (SDG&E). 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 otherwise 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, based on the gas used in the generation of electricity. 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 structures are actually built. During FY 2009-10, development related revenues began to turn around from historic lows experienced in FY 2008-09. For the FY 2010-11 Budget, the development-related revenues are anticipated to continue to increase as a result of the improvement in the economy and real estate market. For FY 2008-09 there were 107 units permitted for residential housing. For FY 2009-10 approximately 265 residential units have been permitted through April 2010. For FY 2010-11, 225 permits are projected to be issued for residential housing. The commercial and industrial building activity remained weak for FY 2008-09 and FY 2009-10 and is expected to continue to be weak FY 2010-11. A 9.1% increase in building related revenue is projected for next year as residential activity is projected to remain relatively strong. Business license taxes are closely tied to the health of the economy and are projected to increase by 2.9% to an estimated $3.5 million. There are currently about 8,700 licensed businesses in Carlsbad, with over 2,600 of them home-based. All other revenues include vehicle license fees, transfer taxes, interest earnings, ambulance fees, recreation fees, interdepartmental charges and other charges and fees. The estimate for Fiscal Year 2010-11 totals $15.9 million, a $5.1 million decrease from the previous year. In FY 2009-10, one time funds were received from the sale of property to the Redevelopment Agency. In addition, a decrease in the interdepartmental charges from the recent Citywide redesign is 2010-11 OPERATING BUDGET OVERVIEW B-5 projected in FY 2010-11. Interdepartmental charges include overhead charges to non General fund departments for citywide overhead calculated in the cost allocation plan. 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. Carlsbad expects to receive approximately $804,000 in transfer taxes for FY 2010-11, which is a $300,000 increase over FY 2009-10. This is mainly due to the increase in the median housing price as well as the increased foreclosure sales. 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 $1.9 million in interest on its General Fund investments for Fiscal Year 2010-11. General Fund Revenues Overall, as reflected in the bar chart, General Fund revenues are expected to be down 3.8% from FY 2009-10 estimates due to the decrease in property taxes, one-time funds received in FY 2009-10 from the sales of property and a decrease in interdepartmental charges resulting from the Citywide redesign. Although the City experienced revenue growth between 9% and 17% in the late 1990’s, it was not sustainable growth. Much of those increases were due to the opening of new hotels, restaurants, retail centers, and new home development. As the City matures, it will be increasingly more difficult to produce double-digit growth in revenues. With the current economic slowdown, limited growth is anticipated over the next two to three years with the City returning to 4% to 7% growth rates in the future. Other Funds Revenues from Special Revenue funds are expected to total $10.9 million in FY 2010-11, a $1.9 million decrease from FY 2009-10. The types of programs supported within Special Revenue funds are those funded by specific revenue streams such as: Grants (Rental Assistance-Section 8, Community Development Block Grants, COPS Grant) Special fees and assessments (Affordable Housing, Maintenance Assessment Districts) Donations (Library, Cultural Arts, Recreation and Senior Donations) 0 20 40 60 80 100 120 140 FY 2006 FY 2007 FY 2008 FY 2009a FY 2009r FY 2010e FY 2011 +2.1% +18.4%-2.7%-0.7%-6.2%-3.8% $ Millions -3.7% 2010-11 OPERATING BUDGET OVERVIEW B-6 The most noteworthy change in the Special Revenue funds occurred in the Street Lighting Fund. Estimated revenues decreased approximately $2.5 million from FY 2009-10. During FY 2009-10, the City received approximately $1 million in Energy Efficiency and Conservation Block Grant funds from the federal government and anticipates receiving an additional $1.5 million in American Recovery and Reinvestment Act funds from the California Energy Commission. These revenues are one-time grant monies which are being used towards the City’s street light retrofit project. The street light retrofit project will replace the City’s high- pressure sodium vapor lights with induction lights. Enterprise fund revenues for FY 2010-11 are projected at $50.2 million, an increase of $3.2 million or 6.8% over current year projections. The increase in revenues is primarily due to the proposed rate increases for Water and Wastewater funds. Enterprise funds are similar to a business, in that rates are charged to support the operations that supply the service. Carlsbad Enterprise funds include water and recycled water delivery, wastewater services, and solid waste management. The Water Enterprise Fund revenue is estimated at $29.7 million, an increase of $2.1 million, or 7.7% over the current year estimate. Of that increase, $1.9 million will be from water sales reflecting an 18% proposed rate increase effective January 1, 2011, to pay for the rising cost of water purchases. The proposed rate increases have not yet been approved by the Board of Directors of the Carlsbad Municipal Water District; staff will be requesting that a Public Hearing date be scheduled at a future date in order to consider the proposed rate increases. Anticipated increases paid to the San Diego County Water Authority include a 9% increase to the wholesale purchase cost of water (from $814 to $887 per acre foot), and a 19% increase in the fixed charges for water purchases (from $3.5 million to $4.3 million). In addition to paying for the wholesale and fixed water costs, the FY 2010-11 Operating Budget includes funding for ongoing operations at existing service levels, replacement of Carlsbad’s infrastructure, and ongoing meter replacements. Wastewater estimated revenues are $10.1 million, $711,000 over the current year estimate. Of that increase, $452,000 million will be from a 10% proposed rate increase in sewer service charges, effective January 1, 2011, which is needed to fund the ongoing cost of operations, maintenance, and funding for replacement of infrastructure. The rate increases have not yet been approved by the City Council; staff will be requesting that a Public Hearing date be set for a future date. Rental Assistance 60% Affordable Housing 4% CDBG 6% Maintenance Districts 24% Donations and Grants 3% All Others 3% SPECIAL REVENUE FUNDS 2010-11 PROJECTED REVENUES 2010-11 OPERATING BUDGET OVERVIEW B-7 In addition to the water and wastewater recommended rate increases, included in the Solid Waste revenues is a proposed a 3.3% increase to the base rate of the Solid Waste Fee. This would raise the total Solid Waste rate for a single family residence by $.50 per month, or 2.65%. The additional revenue generated by the rate increase would be retained by Coast Waste Management as an increase to their fee for providing waste management services. The last time Coast Waste received an increase was in Fiscal Year 2006. This rate increase has not yet been approved by the City Council; staff will be requesting that a Public Hearing date be set at a future date. Internal Service funds show estimated revenues of $16.3 million for FY 2010-11, an increase of 9.4%, or $1.4 million, from FY 2009-10 projections. Internal Service funds provide services within the City itself, and include programs such as the self-insurance funds for Workers’ Compensation and Liability (Risk Management), as well as Vehicle Maintenance and Replacement. 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. The more significant increases occurred in Information Technology, Vehicle Maintenance and Vehicle Replacement. In Information Technology, the Geographic Information System Department was merged with Information Technology which added almost $600,000 to the Information Technology budget which is now being charged out in the interdepartmental charges. In the Vehicle Maintenance Fund, the increase is mainly due to the increased costs of vehicle maintenance as well as the cost of fuel. For the Vehicle Replacement Fund, the increase reflects additional allocations to ensure sufficient revenues are available to replace equipment at the end of its useful life. More discussion on the costs can be found in the Expenditures section of this report. Redevelopment revenues are expected to total $3.4 million in the upcoming year, a decrease of 2.9%, or $155,000, from the projections from the previous year. This decrease is the result of an estimated 2.4% decrease in property tax increment revenues collected for the Village. The City has a General Fund reserve policy that sets a minimum reserve of 30% of the General Fund Operating Expenditures. In addition, the policy sets a target reserve of 40% to 50% 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 2008-09, the undesignated and unreserved General Fund balance was approximately $48.3 million. At the end of FY 2009-10 the reserve is projected to be approximately $51.4 million, or 47% of the FY 2009-10 Budget. The reserve amount is consistent with Council Policy 74: General Fund Reserve Guidelines. 2010-11 OPERATING BUDGET OVERVIEW B-8 EXPENDITURES The City’s Operating Budget for FY 2010-11 totals $188.3 million, which represents a decrease of about $2.8 million, or 1.5%, as compared to the adopted FY 2009-10 Budget. The changes in each of the City’s programs will be discussed below. Budgetary Policies The theme behind this year’s budget development was to incorporate a new organizational structure while maintaining a long-term plan for a balanced budget, given the continued economic uncertainty. As the City transitions from a growing and developing city to a built-out city, a new organization design needed to be developed to allow resources to be aligned with the community’s future needs. During FY 2009-10, a year-long effort evaluated how the City was currently delivering services to residents and businesses and identified where opportunities existed to streamline for the future while continuing to provide high quality services. Key areas of focus included those most affected by the City’s increasing maturity, such as traffic and transportation, economic and community development, environmental management and infrastructure maintenance and replacement. Based on these efforts, the City realigned the organizational structure to better serve the changing needs of the community, as well as to allow for increased efficiencies with fewer resources. The FY 2010-11 Operating Budget was developed using the new department configuration. For comparison purposes, historical data for departments was restated to reflect the new structure, where applicable. Responsible management of the City’s resources includes maintaining a focus on a sustainable future by ensuring the City remains in good financial health. Considering that today’s decisions will impact future spending levels, and given the uncertainty of the economy, the following policies were set for FY 2010-11: Continue to minimize service level impacts to our citizens. No new positions and no growth in maintenance and operations for FY 2010-11. No new programs will be considered unless required under a legal mandate. Absorb negotiated personnel contract increases where possible. Generally, be prudent in budgeting. Consider cost containment measures and budget discretionary items 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. Typically, each year the block is increased by an index for growth and inflation. However, in both FY 2008-09 and FY 2009-10, as a result of the economic recession, block budgets were decreased in response to decreased revenues. Focus shifted from growth and moved to maintaining core city services and finding efficiencies in operations, allowing for lower budget levels. By planning ahead, Carlsbad was able to make those changes early, avoiding major changes for FY 2010-11. For FY 2010-11 departments absorbed inflationary increases where possible, and overall operations costs remained at the FY 2009-10 levels, anticipating a flat economy in the coming year. Due to the City’s reorganization efforts previously mentioned, block budgets were reallocated among various departments, based on the personnel and tasks assigned to each of the new and continuing departments. No increases to the overall block resulted from the realignment and no additional appropriations are expected during the year, except in the case of a significant unanticipated event. Amounts that are unspent at the end of the fiscal year will be carried forward to the new fiscal year. At the end of FY 2009-10, the amounts carried forward by each department will be capped at no more than 10% of the previous year’s adopted budget. 2010-11 OPERATING BUDGET OVERVIEW B-9 Budgeted Expenditures Through the application of these guidelines and policies, the FY 2010-11 Operating Budget of $188.3 million was developed. Position Changes A decrease of 13.75 full-time and 3.5 limited-term positions, representing a total decrease of 17.25 positions, is reflected in the FY 2010-11 Operating Budget, as compared to the FY 2009- 10 Adopted Budget. The total decrease includes the elimination of 12.25 positions identified through the City’s realignment efforts, as well as the elimination of 5 positions that had previously been unfunded. The FY 2010-11 Operating Budget includes the elimination of the following 13.75 full-time positions: 2.0 Administrative Secretaries 1.0 Assistant Planning Director 1.0 Custodian 1.0 Deputy City Engineer 1.0 Deputy Public Works Director 0.75 Librarian II 1.0 Management Analyst 1.0 Public Works Manager 1.0 Recreation Specialist 1.0 Secretary 1.0 Senior Management Analyst 2.0 Utility Workers In addition, the following 3.5 limited term positions have expired and will be eliminated: 2.0 Building Inspectors, 1.0 Associate Planner, and a 0.5 GIS Intern position. In addition to the eliminated positions mentioned above, there are 6 other positions that are projected to remain unfunded for FY 2010-11. The unfunded positions provide an opportunity for departments to realize salary savings while still maintaining a count for the vacant position, which could be budgeted again in a future year once the economy improves. The net increase in hourly staff totaled 0.5. This increase was due to an hourly maintenance worker being hired to provide a partial replacement for one of the full-time positions eliminated above. These changes result in a City workforce of 699.0 full and three-quarter time employees, no limited term employees, and 138.94 hourly, full-time equivalent positions. As mentioned above, six of the full-time positions are not funded in the FY 2010-11 Budget. 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 the Operating Budget. The Carrillo Ranch Barn Restoration project is scheduled for completion in the Spring of 2011. Additional funds for maintaining this facility will be incorporated in the FY 2011-12 Budget. 2010-11 OPERATING BUDGET OVERVIEW B-10 Budget by Fund Type The table below shows the changes in the Operating Budget for FY 2010-11 compared to the Adopted Budget for FY 2009-10. BUDGET BUDGET $% FUND 2009-10 2010-11 CHANGE CHANGE GENERAL FUND 109.1$ 109.4$ 0.3$ 0.3% SPECIAL REVENUE 10.5 10.9 0.4 3.8% ENTERPRISE 54.6 51.6 (3.0) -5.5% INTERNAL SERVICE 15.1 14.3 (0.8) -5.3% REDEVELOPMENT 1.8 2.1 0.3 16.7% TOTAL 191.1$ 188.3$ (2.8)$ -1.5% BUDGET EXPENDITURE SUMMARY BY FUND TYPE (In Millions) The General Fund contains most of the discretionary revenues that support the 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 Carlsbad. The remainder of this section will provide more information about the budgeted expenditures by fund and program. GENERAL FUND SUMMARY GENERAL FUND SUMMARY BY EXPENDITURE TYPE BY EXPENDITURE TYPE BUDGET BUDGET $% 2009-10 2010-11 CHANGE CHANGE PERSONNEL 74.5$ 72.5$ (2.0)$ -2.7% M & O 27.9 29.3 1.4 5.0% CAPITAL OUTLAY - - - 0.0% TRANSFERS 6.7 7.6 0.9 13.4% TOTAL 109.1$ 109.4$ 0.3$ 0.3% (In Millions) General Fund The total budget for the General Fund for FY 2010-11 is $109.4 million, which is 0.3% greater than the previous year’s adopted budget of $109.1 million. Net decreases in personnel are partially offset by net increases in maintenance and operations costs. Increases in transfers out from the General Fund to other City funds increased by $0.9 million, or 13.4%, which accounts for the remaining increase in the General Fund, as can be seen in the table above. Personnel costs make up approximately 66% 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 2010-11 is $72.5 million, which is $2.0 million, or 2.7%, less than the previous year’s personnel budget of $74.5 million. The decrease was due to several factors, as discussed on the following page. 2010-11 OPERATING BUDGET OVERVIEW B-11 GENERAL FUND GENERAL FUND PERSONNEL COSTS PERSONNEL COSTS (In Millions) BUDGET BUDGET $% 2009-10 2010-11 CHANGE CHANGE SALARIES 50.9$ 50.8$ (0.1)$ -0.2% HEALTH INSURANCE 6.4 6.1 (0.3)-4.7% RETIREMENT 14.9 13.3 (1.6)-10.7% WORKERS COMP 1.2 1.2 0.0 0.0% OTHER PERSONNEL 1.1 1.1 0.0 0.0% TOTAL 74.5$ 72.5$ (2.0)$ -2.7% The table above shows the breakdown of personnel costs for the General Fund. Salaries include full and part-time staff costs. Overall, total personnel and benefits costs are projected to decrease for FY 2010-11 as compared to FY 2009-10, as discussed below. While health Insurance rates are projected to increase by 5%, and retirement rates are projected to remain flat, both these line are projected to have an overall decrease in FY 2010-11, due to the overall personnel decreases discussed below. Workers’ Compensation and miscellaneous other personnel costs are projected to remain flat for FY 2010-11. Overall, total personnel costs are projected to decrease by $2.0 million, or 2.7%, for a combination of reasons. Eliminating full-time positions and other salary savings related to the City’s realignment efforts, resulted in approximately $1.2 million of savings in personnel costs. In anticipation of these personnel changes, $800,000 of these savings had already been incorporated into the FY 2009-10 adopted budget, so approximately $400,000 was realized as reduced personnel costs in FY 2010-11. Public safety employee contract negotiations resulted in a decrease in retirement costs, as well as a small increase in salaries, for a total of approximately $800,000 of decreases in total personnel cost. The transfer of Geographic Information Systems (GIS) personnel out of the General Fund to the Information Technology Internal Service Fund, resulted in an additional reduction of $500,000 in total personnel costs. This reduction will be offset by increases in maintenance and operations costs charged to departments, as GIS services will now be allocated out through the internal service fund charges. Additionally, the transfer of approximately $1.0 million in personnel costs to Non-General Fund departments, as part of the City’s realignment efforts, also reduced overall personnel costs to the General Fund. This reduction will be offset by corresponding increases in Maintenance & Operation costs due to chargeback reductions as well as by decreases in interdepartmental revenues. These total reductions are somewhat offset by the increases in salaries budgeted to occur in FY 2010-11, mainly due to previously negotiated labor contracts, netting to the overall decrease of $2.0 million in total personnel costs. Maintenance & Operations costs (or M&O) include the budgets for all program expenses other than personnel or capital outlay, and represent about 27% of the overall General Fund budget. Overall, maintenance and operations costs are projected to increase by about $1.4 million, or 5%, mainly due to offsetting personnel decreases. The transfer of GIS personnel out of the General Fund resulted in about $600,000 in increases in maintenance and operations costs charged to departments, largely offset by $500,000 in decreases in personnel costs, as noted above. Additionally, the transfer out of personnel and M&O costs to Non-General Fund departments, as part of the City’s realignment efforts, resulted in about $800,000 in 2010-11 OPERATING BUDGET OVERVIEW B-12 corresponding increases in M&O costs due to chargeback reductions. Finally, M&O costs were reduced in some departments in order to absorb personnel increases, when needed. These reductions were offset by miscellaneous increases that could not be absorbed without service level impacts. Maintenance and Operations costs are discussed more fully by program, later in the report. Capital Outlay includes budgeted equipment purchases over $1,000. There are no major capital outlay purchases planned in the General Fund for FY 2010-11. 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: $7.2 million to the Infrastructure Replacement Fund - for major maintenance and replacement of City infrastructure. This represents 6.5% of the General Fund Revenues, an increase from the 6.0% transfer in FY 2009-10. $207,000 to the Storm Water Program for reimbursement for the General Fund portion of Storm Water expenses. $253,850 to the Median Maintenance Special Revenue Fund to cover a cash shortfall, as annual assessments collected from property owners do not cover operating expenditures. Advances are amounts anticipated to be transferred from the General Fund to another City fund and are expected to be repaid to the General Fund in future years. The advances included in this year’s proposed budget are to the following funds: $1.7 million to the Golf Course for operations - The Golf Course is a relatively new facility and there is only a short history to support the budget development. The Golf Course’s budget and financials are on a calendar year basis. The Carlsbad Public Financing Authority approved the 2010 Golf Course Budget including an advance of $1,761,000 million from the General Fund. $85,000 to the South Carlsbad Coastal Redevelopment Area (SCCRA) – The SCCRA is not projecting to generate tax increment for FY 2010-11. However, there are activities that need to be performed to help generate tax increment producing projects within the area, such as the Ponto Development and the proposed new desalination project. Once more development occurs in this area, it is anticipated that the SCCRDA will be able to repay the General Fund advances. Repayments are also included in the FY 2010-11 General Fund budget. The General Fund has advanced money to several funds. A portion of those advances are being repaid as follows: $136,000 is being repaid from the Storm Water Fund for a loan made from the General Fund to help establish this fund. Another way of looking at the General Fund budget is by program. The chart on the following page compares the total FY 2010-11 Budget to the amounts adopted in the previous year. The significant changes are noted below the chart. 2010-11 OPERATING BUDGET OVERVIEW B-13 GENERAL FUND EXPENDITURES GENERAL FUND EXPENDITURES BY DEPARTMENT BY DEPARTMENT (In Millions) BUDGET BUDGET $% FUND 2009-10 2010-11 CHANGE CHANGE POLICY/LEADERSHIP 5.2$ 5.3$ 0.1$ 1.9% COMMUNITY & ECONOMIC DEV 8.2 7.4 (0.8)-9.8% FINANCE 3.3 3.3 0.0 0.0% FIRE 16.8 16.2 (0.6)-3.6% HOUSING & NGHBRHD SRVCS 0.4 0.4 0.0 0.0% HUMAN RESOURCES 2.4 2.4 0.0 0.0% LIBRARY & ARTS 10.1 10.4 0.3 3.0% PARKS AND RECREATION 12.5 12.4 (0.1)-0.8% POLICE 27.7 28.2 0.5 1.8% PROPERTY & ENVIRO MGT 4.9 4.8 (0.1)-2.0% STORM DRAIN ENGINEERING 0.3 0.3 0.0 0.0% TRANSPORTATION 9.8 9.1 (0.7)-7.1% NON-DEPARTMENTAL 7.5 9.2 1.7 22.7% TOTAL 109.1$ 109.4$ 0.3$ 0.3% The Policy/Leadership Group includes all elected officials, the City Manager’s Office, the City Attorney’s Office, and Communications and Records Management functions. The $100,000, or 1.9%, increase for FY 2010-11 is primarily due to a projected increase in the City Clerk’s office for increased expenses related to the November 2010 election. The Community and Economic Development Department was created from the former Community Development Department and includes economic development, planning, development services, building and code enforcement, and the addition of land use engineering. Of the $800,000, or 9.8%, decrease from FY 2009-10 to FY 2010-11, $300,000 is attributable to eliminating two positions. An additional $500,000 net decrease is due to the transfer of $500,000 in GIS services out of the General Fund, to the Information Technology group. The transfer results in decreased personnel costs in the General Fund. However, since GIS costs will now be allocated to departments as part of the Information Technology Internal Service Fund charges, M&O increases to departments will occur as a result of the transfer. The Finance Department continues to provide the day-to-day accounting, financial reporting, collections, fiscal oversight, and long-term financial planning for the City. The department’s budget remained relatively flat from FY 2009-10 to FY 2010-11. The Carlsbad Fire Department continues as one of the cornerstones of the City’s public safety efforts, which remains a City Council priority. Services include emergency operations, emergency preparedness, and fire prevention. The $600,000, or 3.6%, decrease for FY 2010-11 is mainly due to a decrease in retirement costs resulting from labor contract negotiations completed in May 2010. This decrease was somewhat offset by additions to fund previously contracted personnel increases. Also, due to deep overtime budget reductions made in prior years, approximately $150,000 was added back to the department’s budget to meet required staffing levels on a 24/7 basis, in order to provide full emergency response coverage. 2010-11 OPERATING BUDGET OVERVIEW B-14 In the General Fund, the Housing and Neighborhood Services Department includes the City’s neighborhood services, hiring center and volunteer programs. No change is expected for FY 2010-11 as compared to the FY 2009-10 Budget allocation. The Human Resources Department continues to support the City’s full-time and part- time staff by providing services such as staffing and recruitment, employee development, performance management and compensation, and labor relations. The department’s budget will remain flat from FY 2009-10 to FY 2010-11. The Library and Arts Department provides staffing and a wide variety of programming for two library branches, a library learning center, and a cultural arts office. The $300,000, or 3%, increase for FY 2010-11 is primarily due to an increase in Internal Service Fund charges, mainly related to GIS services being allocated to departments beginning in FY 2010-11. The Parks and Recreation Department continues to plan, staff and maintain the City’s parks and recreational facilities, as well as provide an assortment of recreational programs for all ages. In addition, new duties will mean increased responsibilities in managing open space areas. The department’s budget decreased by $100,000, or 0.8%, mainly as a result of a position elimination and a decrease in projected vehicle maintenance and replacement costs. These were offset slightly by additions made to fund previously contracted personnel increases, as well as a slight increase in M&O costs to provide funding for efforts made on the Urban Forest Management Plan. The Carlsbad Police Department continues to provide high quality service to the community to ensure the preservation of life and property, and the maintenance of law and order. The Operating Budget shows the department’s costs increasing by $500,000, or 1.8%, for FY 2010-11 as compared to FY 2009-10. This increase is partially due to additions made to fund previously contracted personnel increases and partially due to an increase in Internal Service Fund charges, including increased vehicle and equipment replacement costs, an increase in projected vehicle maintenance costs, and an allocation of GIS services. These were partially offset by a decrease of about $100,000 in total personnel costs due to labor contract negotiations completed in May, 2010. The Property and Environmental Management Department includes managing 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 $100,000, or 2.0%, decrease for FY 2010-11 as compared to the FY 2009-10 budget allocation, is mainly due to the elimination of 1.35 positions, offset by an increase for a preserve steward contract related to the City’s Habitat Management Program. The Transportation Department, previously part of the larger Public Works Department, manages all streets, traffic and other transportation services. The department shows an overall decrease of $700,000, or 7.1%. The decrease reflects the elimination of 2.95 positions previously part of the Public Works Department, as well as the transfer of some personnel, maintenance and operations, and Internal Service Fund costs to Non-General Fund departments, as part of the City’s realignment efforts. 2010-11 OPERATING BUDGET OVERVIEW B-15 The Storm Drain Engineering division develops and updates the City’s drainage master plan as well as manages the construction and repair of the City’s storm drains. No change is expected from FY 2010-11 as compared to the FY 2009-10 budget allocation. Non-departmental expenses include the transfers previously discussed as well as administrative and other expenses not associated with any one department. The increase of $1.7 million, or 22.7%, is attributed to $800,000 in personnel savings reflected in FY 2009-10 being spread to individual departments for FY 2010-11, and a $900,000 increase in anticipated transfers from the General Fund to other City funds. The Council Contingency account is available to the City Council for unanticipated emergencies or unforeseen program needs during the year. It is budgeted at $500,000 for FY 2010-11, which is equal to the amount budgeted for this item in FY 2009-10. The budgeted amount represents less than 1% of the FY 2010-11 General Fund Budget. General Fund Expenditure History As reflected in the chart to the left, the City began to slow its expenditure growth in FY 2007-08 in anticipation of the economic slowdown. The chart shows the 4.8% mid-year reduction in January 2009 and a further 3.3% reduction in FY 2009-10 to further reduce expenditures to keep in line with General Fund Revenue declines. FY 2010-11 expenditure projections remain relatively flat in anticipation of a flat economy in the coming year. Changes in Other Funds Special Revenue funds, at $10.9 million, are up $400,000, or 3.8%, from the prior year. This increase is mainly due to an increase in proposed spending for the City’s Local Cable Infrastructure Fund due to planned expansion of the City’s public access video and communications technologies for FY 2010-11. Enterprise funds total $51.6 million, which is a decrease of $3.0 million, or 5.5% under the FY 2009-10 adopted budget. The most significant change is in Water Operations due to reduced anticipated expenditures for water purchases. Carlsbad residents have been conserving water and actual water purchases and water sales have come in significantly lower than previously anticipated; water sales in Fiscal Year 2010 will be approximately 15% lower than the prior year. Despite the increase in the cost of water purchased from the San Diego County Water Authority (18% increase in fixed costs and 9% average increase in variable costs for the fiscal year), the total amount budgeted has decreased due to the lower anticipated sales volume. The decrease in water purchases is largely offset by decreases in sales revenue. 90 95 100 105 110 115 120 FY 2006 FY 2007 FY 2008 FY 2009a FY 2009r FY 2010e FY 2011 +11.4 +11.9% +3%-0.3% -3.3%+0.3% $ Millions -4.8% 2010-11 OPERATING BUDGET OVERVIEW B-16 Wastewater operations are projected to increase 3.4%, or $300,000, over the adopted budget for FY 2009-10. The operating budget includes additional funding for Encina Wastewater services and depreciation replacement transfers related to growth in the wastewater infrastructure system. The Internal Service funds total $14.3 million, and are reduced $800,000, or 5.3% from the prior year. The Internal Service funds are self-supporting through user charges. Changes occurred in a number of these funds: The Self Insured Benefits budget shows a decrease of approximately $90,000 based on a decreases in health related expenses paid from the fund. The Vehicle Maintenance Fund budget has decreased by approximately $80,000 in FY 2010-11. This reflects reductions in the budgets for parts and outside vehicle maintenance expenses. The Vehicle Replacement Fund budget varies from year to year depending on the vehicles to be replaced. The budget for the fund is $264,000 less than the previous year, or a 16.8% decrease. A list of the requested vehicles can be found at the end of this document. The Information Technology Fund shows a decrease in the department’s budget of approximately $400,000, or 5.8%. The budget decreased by about $600,000 due to a decrease in major capital outlay and by about $300,000 due to decreases in one-time technology investments. These decreases were partially offset by the transfer of GIS costs from the General Fund, which increased the budget by approximately $500,000. The Redevelopment Agency budgets have increased about $300,000 from the previous year, mainly due to a mandated payment to the state of approximately $277,000 projected for FY 2010-11, due to the state’s budget crisis. SUMMARY This Operating Budget for FY 2010-11 emphasizes maintenance and operation of the City’s current infrastructure and maintaining core City services at their current levels. Being conscious of the economic slowdown, no new programs or expanded levels of service are included in the budget. The ten-year financial forecast is of concern since there are several years in the future reflecting deficits and other years reflecting lower projected surpluses than in previous years’ forecasts. Revenues and expenditures will continue to need close monitoring. The City may need to further reduce expenditures in the following three years if the assumptions made regarding the recession’s recovery prove inaccurate, in order to ensure we live within our means through these turbulent and uncertain economic times. The ten-year financial forecast is a useful tool to help manage our way through the economic uncertainty. The City of Carlsbad has a diverse revenue base and is in a good economic position; however, Carlsbad is not immune to the economy. The planning and foresight by the City Council and residents have provided a sound economic base for the City. Fiscal conservatism, which has consistently been the City’s overall approach to managing its finances, is even more important during these economically uncertain times. 2010-11 OPERATING BUDGET OVERVIEW B-17 The City recently completed a citywide redesign in order to adapt to the transition from a growing and developing city to a built-out city. The new organization structure is designed to better serve the changing needs of the community, as well as to allow for increased efficiencies with fewer resources, while continuing to provide high quality services. The FY 2010-11 Operating Budget was developed using the new department configuration. The Carlsbad City Council’s annual goal setting process this year focused on supporting an excellent quality of life as the City transitions from a period of growth to a new era focusing on economic, environmental and community sustainability. Maintaining core city services at their current levels was the top priority in developing the budget for the coming fiscal year. Other priorities focus on supporting the important values identified through Envision Carlsbad, a City- sponsored program to create a community vision for Carlsbad’s future. Policy Ldrshp Policy and Leadership Group Internal Srvcs Internal Services Comm Dev Community Development Comm Srvcs Community Services Public Safety Public Safety Public Works Public Works Capital Improvement Program Capital Improvement Program Overview Overview Schedule of Capital Projects Capital Proj Fund Summary Fund Summary INDEX A About the City of Carlsbad, iii Accounting Systems and Budgetary Control, L-5 Acronyms, L-35 Affordable Housing, E-15 Arts Office, F-16 Asset Forfeiture, G-24 B Budget Awards, A-24 Budget Highlights, A-3 Budget Process, A-4 Budget Summary, A-21 Buena Vista Channel Maintenance, H-15 Building and Code Enforcement, F-10 C Calendar, A-23 Canine, G-15 Capital Improvement Program Overview, I-1 Capital Improvement Projects 2010-11, J-1 Capital Outlay Items, L-1 Capital Projects, I-2 Capital Projects through Buildout, I-5 Carlsbad City Library, F-4 Cole Library, F-2 CIP Budget Expenditure Schedule, I-15 CIP Fund Summary, K-1 CIP Projected Fund Balances, I-12 CIP Revenue Estimates, I-14 CIP Summary, I-10 Citizens Option for Public Safety, G-25 City Attorney, C-11 City Clerk, C-4 City Council, C-2 City Manager, C-7 City Manager’s Transmittal Letter, A-1 City Treasurer, C-5 Collection Development & Acquisitions, F-10 Communication, C-9 Communications Center, G-23 Community Development Administration, E-2 Community Development Block Grant, E-17 Community Relations, F-12 Community Services - Police, G-13 Community Vision, A-4 Construction Management & Inspection, H-2 Council's Five-Year Vision Statement, ii Cultural Arts Summary, F-14 Cultural Arts Donations, F-19 D Debt Management Issues, A-20 Dove Library, see Carlsbad City Library E Economic Profile, A-5 Emergency Operations, G-4 Emergency Preparedness, G-6 Expenditure Schedule, B-26 F Family Services, G-20 Field Evidence, G-16 Field Operations, G-12 Finance, D-1 Fire Administration, G-3 Fire Department Summary, G-1 Fund Balances, B-18, J-12 Future Growth & Development, I-7 G Gann Appropriations Limit, L-19 General Fund, A-10, B-1 Glossary - Capital Projects, K-15 Glossary, L-33 Growth Projections, I-7 Growth Management Plan, I-10 H Highlights, A-3 Housing and Neighborhood Services, E-12 Human Resources, D-6 I Information Technology, D-11 Investigations, G-16 INDEX L Land Development Engineering, E-4 Land Use Planning, E-7 Library Learning Center, F-6 Library Summary, F-1 Lighting & Landscape District No. 2, H-12 Low/Moderate Income Housing - Village, E-21 Low/Moderate Income Housing - South Carlsbad Coastal, E-22 M Media Services, F-11 Median Maintenance, F-43 Miscellaneous Non-Departmental, D-13 O Operating Budget Overview, B-1 Operating Expenditures, B-26 Organization Chart, iv Other Funds, B-5 P Park Maintenance, F-38 Park Planning & Recreation Mgt., F-23 Parks & Recreation Summary, F-20 Personnel Allocations, A-22 Police Administration, G-11 Police Grants, G-26 Police Summary, G-9 Policy & Leadership Summary, C-1 Prevention, G-8 Project Evaluation, I-2 Property and Environmental Management, D-14 Property and Evidence, G-19 R Readers Guide to the Budget, i Recreation - Aquatics, F-29 Recreation Fee Supported, F-25 Recreation Operations, F-32 Redevelopment Operations - Village Area, E-19 Rental Assistance, E-16 Resolutions, L-6 Revenues - Capital Projects, I-8 Revenue Estimates, B-20 Revenue Projections - General Fund, A-11, B-16 Revenue Projections - Operating, A-11, B-20 Risk Management, D-5 S Self-Insured Benefits, D-10 Senior Programs, F-35 Sister City, F-18 Solid Waste Management, H-21 South Carlsbad Coastal Redevelopment Area, E-11 Statistical Information, L-4 Storm Drain Engineering, H-14 Storm Drain Maintenance, H-23 Storm Water Inspection, H-6 Storm Water Protection, D-17 Street Lighting, H-11 Street Maintenance, H-8 Street Tree Maintenance, F-42 Summary, A-21 Support Operations - Police, G-22 Support Services, G-7 T Task Force, G-21 Technical Services - Library, F-8 Traffic Signal Maintenance, H-10 Trails, F-40 Transportation, H-1 Travel, L-2 U Utilities, H-13 V Vehicle Maintenance, D-20 Vehicle Replacement, D-22 Vice/Narcotics, G-17 W Wastewater Operations, H-19 Water Operations, H-16 Weed Abatement, G-5 Worker's Compensation, D-9 Y Youth/School Programs, G-18