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Home My WebLink AboutIII & IV - City Council Planning Session - PowerPointounci i January 25, 2020 Item No. III & IV y 4*i AI- 9.I ; P T anningSession. lrll Financial Overview FY 2018-19 Results Non -Spendable $13.3 $13.1 -$0.2 Restricted $4.4 $4.8 $0.3 Committed $13.4 $13.3 -$0.1 Assigned $0.6 $1.2 $0.6 Contingency $49.1 $52.6 $3.5 "Surplus" $13.0 $11.5 -$1.5 TOTAL $93.9 $96.6 $2.7 FY 2019-20 Revenue Update Revenue Category 2018 Actual 2019% Change 2019 Actual over PY 2020 Revised Budget 2020 2020 Change Projected over PY Property Tax 101,593,290 108,365,261 6.7% 113,601,474 11311751939 4.4% Sales Tax 35,038,846 38,502,470 9.9% 35,697,090 371976,497 -1.4% Transient Occupancy Tax 22,833,614 24,697,446 8.2% 24,458,131 2613841357 6.8% Other General Fund Revenue 57,050,715 58,247,418 2.1% 56,775,811 5710901954 -2.0% Total General Fund 216,516,465 229,812,595 6.1% 230,532,506 2341,6271747 2.1% Net result is $4.1 million projected favorable revenue variance. FY 2019-20 Expenditures Update Expenditures for all operating funds at the end of the second fiscal year quarter (net of CIP, debt service and transfers) are $125.8 million compared to the prior year's $125.2 million, which is an increase of $0.6 million. All departments had budget increases from the prior year, but the largest variances were seen in salaries & benefits and professional service contracts. Expenditures with notable variances from the prior year include: Salaries & Benefits, which include negotiated MOU increases including COLA's/merits Professional and Technical services Groundwater Expense Rolling Equipment The City has expended $125.8 million, or 41.8%, of its amended budget through the end of the second quarter. Overall, costs in total are currently within anticipated results. Expenditure savings are difficult to project this early but are usually significant. FY 2020-21 Preliminary Revenue Outlook Revenue Category 2018 Actual 2019 Actual 2020 Projected 2021% 2021 Change Projected over PY Property Tax 101,593,290 108,365,261 113,175,939 118,567,018 4.8% Sales Tax 3510381846 38,502,470 371976,497 38,760,900 2.1% Transient Occupancy Tax 2218331614 2416971446 2613841357 27,599,738 4.6% Other General Fund Revenue 57,050,715 58,247,418 57,090,954 56,293,489 -1.4% Total General Fund F216,516,465 1 229,812,595 1 234,627,747 1 241,221,145 2.8% Funding Challenges CalPERS Pensions Service Needs • Changing Employment Landscape • Harbor Department Resources Pension Plan Balance & Funded Status Discount Rate Phase -In Accrued Liability (AL) Less: Market Value of Assets (MVA) Unfunded Accrued Liability (UAL) Funded Ratio Fiscal Year 2016 2017 2018 7.375% 7.25% 7.00% 887,481,877 9395503,861 15006,9785316 566,016,065 619,834,899 673,876,069 3215465,812 319,668,962 333,102,247 63.8% 66.0% 66.9% Pension Unfunded Liability (In Millions) Based on Past Losses $350 $300 $250 $200 $150 $100 $50 $310 29\5\_0$263 245 $226 $206 184 161 136 109 $81 $35 $35 $35 $35 $35 $35 $35 $35 $35 $35 $35 $35 $50 $35 $17 $0 $18 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 —Balance Payment Wilshire Consulting CaIPERS Expected Return and Risk Estimates 15.0% 10.01 5.0% 0.0% Target Allocation Actual Allocation ■ Expected Return - 10 Yr ■ Expected Return - 30 Yr Expected Risk ■ Expected Allocation Based TE Mishire Funded Status Projection through 2034 u Assumed Investment Returns through 2028 And 7% thereafter: Funded UAL 4.0% o • 5.0% 6.1% • 7.0% X8.0% 100.0% 90.0% 4 c� 80.0% a� Z3 `L 69% 70.0% 6 66% 103%:$(44.7)M 97%: $51.4 M 93%: $135.2 M 87%: $228.2 M 83%: $304.6 M 60.0% 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 Year Changing Employment Landscape AB 5 Legislation Employee vs. Independent Contractor W1 I' PERS Audits PEPRA Employees Continue to explore transitioning from use of independent contractors to City employees when doing so is: Fiscally prudent Reduces City exposure Maintains or improves service delivery Harbor Department Accomplishments With 3 years of operation, several accomplishments toward Department goals Increased presence, improved customer support and education provided for harbor community Improved verification for mooring holders, on -water live -aboard community and permitted event -related use of anchorage area Launch of trial vessel -clean-up program for mooring permittees Effective use of public auctions and State grant funds to remove abandoned derelict vessels Update to Title 17 going to City Council on January 28th Harbor Department Code Enforcement — Since July 2018 11476 Cases Opened 1,144 Cases Closed 11225 Warning Notices 132 Administrative Citations 435 Verbal Warnings 3 Revocations 222 Impounds 55 Vessels removed from the Harbor 37 Marine Activities Permits since 2019 Harbor Department 2020 Goals With update of Title 17, increase harbor related code education and enforcement activities Continue to improve customer service and presence on the water Develop additional harbor amenities to better serve mooring permittees and general community of recreational boaters Work to establish a west anchorage area within the harbor Review and update the Marine Activities Permit regulations Changes will require focused resources for education and compliance to achieve successful implementation Harbor Department Proposed Resources Move the Code Enforcement Supervisor permanently to the Harbor Department Add up to three part-time Code Enforcement Trainees with reduction in part-time hours for Harbor Services Workers Add Full -Time Permit Technician to manage and support: Insurance coverage documentation DMV registration US Coast Guard documentation Mooring equipment service records Issuance of Sub -permits Issuance of mooring transfers Assist in administration of mooring extension requests Harbor Department Proposed Resources Harbormaster Full 1.00 1.00 Dept. Asst. Part 0.75 0.50 Permit Technician Full 0.00 1.00 Code Enforcement Trainee Part 0.00 1.50 Harbor Services Worker — Lead Part 2.64 2.64 Harbor Services Worker Part 5.50 4.75 Tota 1 9.89 11.39 Code Enforcement Supervisor* Full 1.00 1.00 Tota 1 10.89 12.39 *The Code Enforcement Supervisor has been on loan from the Community Development Department since July 18, 2018. Funding is still in CDD and not Harbor. Proposal is to move this position permanently to Harbor with no net increase in staffing. Update on Continuing Initiatives Housing Element Update Homeless Strategies John Wayne Airport Trash Recycling Mandates & Upcoming Challenges Housing Element Update Form a new Housing Element Update Advisory Committee Steer and guide staff and consultants Select Housing, Land Use, and Circulation Element consultant Write new elements including completing EIR Contract to City Council March 2020 Continue with community engagement and outreach Utilize existing contract with K&W TASKS Community Engagement (2019) $175,000 Housing Consultant + EIR (2020-21) $750,000 Community Outreach (2020) $100,000 RH NA — U n its / Action Plan Firmly Challenge: Request amendments to make it easier to comply (CEQA, Gov Code) Request support from League of CA Cities and OCOG File an Appeal to SCAG Lobbyist Develop map of where housing can be placed, identifying: FEMA — Flood Map Environmental Sensitive Areas High Fire Severity Zones Seismic / Liquefaction Clarity from HCD on what counts towards RHNA ADU Amnesty Live Aboard Monitor housing bills and new legislation SB 50 Home Rule Homeless Strategies City Efforts City's Homeless Liaison Officer/New Homeless Coordinator City Net Contract —outreach services Homeless Task Force, Ad Hoc Council Committee No Panhandling signs Updated website with portal for giving Education programs (United Way, Mental Health) Evaluation of Temporary Shelter sites including regional partnerships City Rapid Response Team to address most vulnerable Explore Permanent Supportive Housing Opportunities and Partnerships Resources for Homeless Strategies Continue allocation of Homeless Liaison Officer (PD) and Homeless Coordinator (on loan from LIB to CMO) Continue City Net Contract for Outreach Services - $200,000 Proposed City Rapid Response Team Resources - $200,000 Assistance to individuals as needed: housing vouchers, transportation costs, motel stays, job training, etc. City contribution for shelter solutions and Permanent Supportive Housing Project(s) Homeless Outreach 3/19-12/19 Move homeless off the street, prioritizing the most vulnerable and costly cases 43 Street Exits 344 Active Engagements 899 Contacts (same individuals multiple times) Provide the City a gateway to regional social and health services network Deliver ongoing case management to include long-term housing stabilization Permanent Supportive Housing (PSH) Develop a Request for Qualifications for Permanent Supportive Housing to partner with a developer For Council consideration in February 2020 Focus on housing for seniors Current homeless population (January 2020) includes approximately 22 individuals who are over 50 Project requires City commitment of funds $1.4 million in Affordable Housing Fund $3 million from Hoag Development Agreement SB2 Funds —approximately $300,000 annually John Wayne Airport -Related Achievements 2019 Pursued the quietest, safest and least -polluting departure procedure possible Held three workshops with air carriers, City reps, AWG • 1,500 test flights conducted • Extensive noise modeling and actual data analysis Retained technical consultant with commercial carrier expertise Monitored legislation, developed relationships New local and federal lobbyists retained and government relations strategy drafted Completed two lobbying trips to Washington, D.C. John Wayne Airport -Related Achievements 2019 Tracked JWA General Aviation Improvement Program EIR Strongly advocated for and achieved general aviation and community protections in plan approved by the Board of Supervisors • Met with potential proposers to ensure Newport Beach's interests were conveyed Advocated policies that incentivize air carrier fleet transition Pitched initial concept to state and federal legislators Evaluated Structure and Purpose of Aviation Committee Restructured committee and established working subcommittees • Subcommittees include technical matters, General Aviation Improvement Program, government relations, community outreach John Wayne Airport -Related Efforts 2020 Work with air carriers, FAA, others on implementing quietest, safest and least -polluting departure procedure Investigate other methods to reduce overflight noise impacts on the community Further develop and advocate for state and federal policies that incentivize air carrier fleet transition Continue to monitor legislation and implementation of the 2018 FAA Reauthorization Act Track JWA General Aviation Improvement Program - Consultant Selection and Project Start Up Current Airport/Aviation Consultant Costs Strategy/ Technical Consultant(s) Aviation Noise Consultant Airport Consultant Government Relations (Federal, County) TOTAL (estimated) $75,000 - 100,000 $50,000 $60,000 $120,000 As Needed $330,000 — 350,000 Solid Refuse Collection and Recycling Past and pending changes in State Law & Mandates are requiring adjustments to our refuse collection and disposal operations, as well as increasing program costs SB 1383 AB 1594 AB1826 50% reduction in organics Landfill disposal by 2020 and 75% by Mandatory alternative 2025, and 20% recovery of AB 341 commercial daily cover edible food by 2025 Mandatory organics no longer AB939 recycling; goal considered commercial of 50% diversion in 50 oo recycling; State reduction in 2020 jurisdiction goal of 75% organics r diversion diversion by disposal by requirement 2020 2020 by 2000 Recent Program Adjustments to Accommodate State Law Changes and Control Cost Implement Commercial Waste and Organic Recycling - AB 341 & 1826 (CalRecycle Audit Notice) Implemented enhanced hauler compliance reporting requirements Implemented annual direct notification on all non-compliant businesses Revised & adopted City Muni Code to address commercial recycling requirements Updated & adopted new commercial waste hauler franchises (good through 2026) Updated, consolidated & rebid 4 of the 7 City solid waste contracts Currently working to update Balboa Village Joint Commercial Bid Usage Agreement Waste assessments at all City facilities to include implementation of organic waste recycling to be completed this year Program Adjustments Still Required over the next Couple of Years to Accommodate State Law Changes Adjust program to maintain required minimum 50% overall diversion rate - January 1, 2020 — green waste alternative daily cover can no longer be counted towards division, but now is considered waste if landfilled. Estimated to drop us to approximately 40% overall diversion Looking at diverting current green waste to composting, digestion, waste to energy (10% maximum of volume) Working to capture/report more recycle diversion by commercial haulers (businesses and construction/demolition material) Review and update City recycling fee to compensate for increased costs associated with recycling (recyclable trash and organic waste) Upcoming Program Modifications to Accommodate State Law Changes and Control Cost Reviewing our two Residential Refuse Franchises (held by CR&R) to enhance how we collect and process green waste organics and food waste to comply with AB 1383 Currently residential green waste is placed/collected within the waste refuse cart and sorted out at Material Recovery Facility (MRF). This was ok for prior alternative daily cover; however, currently green material is too contaminated for composting or digestion. Work with contractor to further/better process residential green waste for composting/digesting Modify collection cart process to a: 2 -Cart System: 1) Waste & Recyclables, 2) Green Waste/Organics 3 -Cart System: 1) Waste, 2) Recyclables, 3) Green Waste/Organics Possible New 2 Cart Waste Collection System Current mixed waste cart & commingled recyclables cart Proposed mixed waste & recyclables cart and green organics & food cart Possible New 3 Cart Waste Collection System GLASS . . E- WTAL +V4Ir'sMFry�arM . m co,. 0 PLASTIC .iia K. 110f . owevusnicanNAM . ljpl<r+c lcys • 41 CO'niolya6 .f: r r ND JbvEpNWW. Nam .piiiRMMIM 15 NFfl PAPER Llrrs#cere Mol . Mopc'Y'I•yes ' M#YM7P�#Pa� Mik C. 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YWmay mak.■ ygyi ee+ wftL -awqxxw . 1"T'� • a pew bcoh V" cm lcr,s11 b -M f4.7 Mad Inin TgnpYvN■ rw"rw gm ¢...I PL P'K7+ F tk cwn.pu�L 1) Recyclables Cart 2) Green Organic Waste & Food Cart 3) Waste Cart Council Meeting Dates August Meeting Date Only 1 Meeting held in August Move from second Tuesday in August to fourth Tuesday in August November meetings have been adjusted due to Thanksgiving holiday; this year is an election year November 2020 Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Election Day — November 3 Council Meeting — November 10 Veterans Day Holiday — November 11 Council Meeting — November 24 Thanksgiving Holiday — November 26-27 Questions and Answers k