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Home My WebLink About14 - Mid-Year Budget AmendmentsCITY OF NEWPORT BEACH City Council Staff Report Agenda Item No. 14. TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Dan Matusiewicz, Finance Director — (949) 644 -3123, dmatusiewicz@newportbeachca.gov PREPARED BY: Susan Giangrande, Budget Manager PHONE: 949 - 644 -3128 TITLE: Mid -Year Budget Amendments: Update Certain Revenue Estimates, Increase Certain Expenditure Appropriations, and Authorize the City Manager to Negotiate and Enter into an Agreement with Motorola for the acquisition of a Marine Safety Dispatch System. ABSTRACT: The City of Newport Beach ( "City ") is a financially secure municipality with a prosperous economic base. Staff understands that Council wishes to utilize excess reserves to further benefit the community while continuing to be good custodians of the public's financial resources. After considering the 2013- 14 operating surplus and review of Fiscal Year 2013 -14 revenue estimates, Finance staff is recommending the approval of several budget amendments to appropriate a portion of the General Fund, Unassigned fund balance (from Fiscal Year 2012 -13 operating surplus), to increase certain revenue estimates, to make fund transfers to other strategic reserves, and to increase and adjust several expenditure appropriations as itemized in Appendix A of this report. In addition, the Fire Department is requesting authorization for the City Manager to negotiate and enter into an agreement between the City and Motorola for the acquisition of a Marine Safety Dispatch System (800 MHz). RECOMMENDATION: a. Approve Budget Amendment 14BA -032 that appropriates $12 million of General Fund unassigned fund balance, $1.1 million from General Fund increased revenue estimates, and $1.2 million from other funds, including Tidelands Fund, IT Strategic Fund, and Lifeguard Headquarters Fund; b. Approve Budget Amendment 14BA -033 that records an increase to General Fund revenue estimates of $2,821,196; c. Approve Budget Amendment 14BA -034 that creates a new Facilities Maintenance Division in the Municipal Operations Department (MOD). The budget amendment transfers current facilities maintenance appropriations to the new division; and d. Authorize the City Manager to negotiate and enter into a Communications Systems Agreement with Motorola Solutions, Inc. for a Marine Safety Dispatch System (800MHz) to be installed at Lifeguard Headquarters with a not -to- exceed cost of $230,269.81. FUNDING REQUIREMENTS: As a result of the recommended budget amendments and strategic fund transfers, the General Fund will decrease $13.1 million before considering remaining expected operating savings for the fiscal year. The net impact of the transfers and expenditure appropriations on other funds are as follows: increase of $3 million in the General Liability fund; increase of $700,000 in Facilities Maintenance fund, increase of $269,730 in the 800 MHz Equipment fund, and a decrease of $200,000 in the IT Strategic Fund. a]61d1RI- II*]ZF Budget Amendment 14BA -32 As a result of Fiscal Year 2012 -13 closing entries, the unassigned portion of General Fund balance increased $12 million. Staff is recommending a total of $6 million be transferred from General Fund to other funds as strategic savings to mitigate certain liabilities and ongoing commitments as follows: Facilities Maintenance $1 million, Other Post Employment Benefits (Retiree Health Insurance) $1.5 million, 800 MHz Equipment $500,000, and General Liability $3 million. In addition to strategic savings, staff is recommending appropriation from General Fund Unassigned fund balance in the amount of $7,194,501 for a variety of projects and programs that will benefit the community and continue to emphasize Council's priorities of public safety and investing in our infrastructure. The appropriation recommendations are summarized below, but a complete itemized list is included in Appendix A. Recommended funding for capital improvement projects in planning or design include $750,000 for the expansion of the LED Streetlight conversion project, $2.5 million for the Ocean Boulevard concrete pavement replacement project, and an initial appropriation of $1 million for concrete alley replacement in Newport Heights. Additional funding for the Newport Heights project will be requested in the Fiscal Year 2014 -15 Capital Improvement Budget. The Fire Department has requested $1,123,064 primarily for improvements to the Emergency Medical Services program including paramedic training and equipment, required Fair Labor Standards Act overtime, FF &E for the remodeled Lifeguard Headquarters, Marine Safety dispatch and CAD /RMS equipment. The Municipal Operations Department has requested funding in the amount of $1,084,000 for continued reforestation efforts, Cliff Drive Park re- landscaping, increased costs related to several service contracts, and some one -time facility costs. Additionally, $250,000 is requested for unforeseen oil field maintenance and repair. A contribution to the Newport Mesa Unified School District in the amount of $338,000 for new locker rooms and restrooms at the Corona del Mar High School Pool was requested by the City Manager as well as funding for the CR &R refuse services contract for April through June of 2014 and funding for the Balboa Village Parking Program implementation. Finally, there are several non - General Fund appropriation recommendations including $200,000 from the IT Strategic Fund for equipment such as the EOC's fire suppression equipment, and an additional $100,000 for additional Police CAD /RMS hardware and interface software. Appropriation from the Facilities Maintenance Fund is requested for replacement of the HVAC system at the Police Department at $300,000. The Community Development Department is requesting $120,000 be transferred from the Records Management deposit account to be appropriated for an upgrade to the existing permitting system, Permits Plus. The upgrade is not a replacement for the current system, but an enhancement that will enable the public to obtain, pay fees, and schedule inspections for basic permits online. None of these appropriations affect General Fund fund balance. Staff recommends that Council authorize the City Manager to negotiate and enter into a contract with Motorola to purchase 800 MHz emergency communications equipment, appropriately timed to be installed during the Lifeguard Headquarters remodel. The contract will have a not -to- exceed cost of $230,269.81. Existing equipment is outdated and was highly recommended for replacement by County Emergency communication personnel. Budget Amendment 14BA -033, Revenue Estimate Increases A second budget amendment (14BA -033) increases General Fund revenue estimates by $2.82 million in FY 2013 -14. The information we received from the County Assessor and from our property tax consultant indicates that the City's Fiscal Year 2013 -14 property tax estimates can be increased by $1,811,923 due to a higher than expected assessed value increase and increased construction activity. Sale Taxes and Transient Occupancy Taxes, together, can be can be increased by $1,009,273 as they continue to trend upward due to gradual improvements in the economy. Itemized increases by account can be seen in 14BA -033. Budget Amendment 14BA -034, Facilities Maintenance Division As the City Council continues to invest in City facilities, the need has developed for a facilities maintenance program. The Field Maintenance Division of MOD has historically been responsible for a significant amount of the City's facilities maintenance efforts. Police, Fire, Library Services, and Recreation Services have managed some, if not all, aspects of routine facilities maintenance for their facilities. This budget amendment will transfer current fiscal year budget appropriations to create a new Facilities Maintenance Division in MOD. The new division will be staffed by transferring the current Facilities Maintenance Crew Chief, four Facilities Maintenance Technicians, and one Electrician from the Field Maintenance Division. The salary and benefits for those six positions total $636,940. In addition, funding for electrical utilities, janitorial services, and landscape maintenance will be transferred from the Field Maintenance Division to the new Division. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378)of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENTS Name: Description: ❑ 02 -25 -14 Appendix A Mid Yr Rea Summary FINAL.odf Appendix ❑ 14BA- 032.xlsx 14BA -032 ❑ 14BA- 033.xlsx 14BA -033 ❑ 14BA- 034.xlsx 14BA -034 Fiscal Year 2013 -14 Mid -Year Budget Amendment Summary GENERALFUND General Fund Amount Available: $ 14,836,548 Proposed Expenditures: One -Time Facilities Maintenance $ 360,000 On -Going Facilities Maintenance $ 276,000 Initial Start to Refuse Contract $ 497,675 Community Benefit Appropriations $ 220,508 - CdM Pool Locker Room $ 338,000 - BVAC Parking Program $ 150,000 - Reforestation & Park Improvements $ 500,000 - Ocean Blvd Concrete Pavement $ 2,500,000 - LED Streetlights $ 750,000 - Newport Heights Concrete Alleys $ 1,000,000 Fiscal Stewardship - FLSA Compliance (Fire) $ 351,250 - Additional Contribution to OPEB $ 1,500,000 - Additional Contribution to General Liability $ 3,000,000 - Additional Contribution to Facilities Maintenance $ 1,000,000 Public Safety - Strategic Purchase of 800 MHz Radios (Police) -GF component $ 500,000 - Community Paramedicine (EMS) $ 141,306 - Lifeguard CAD /RMS & Dispatch Equipment $ 330,270 SUBTOTAL $ 13,194,501 REMAINING GENERAL FUND AMOUNT $ 1,642,047 OTHER FUNDS Other Funds - Funds Available: Contributions Fund Tidelands Fund Facilities Maintenance Fund OPEB Fund IT Strategic Fund START Reserves Records Management Deposit Account Proposed Expenditures: One -Time IT Equipment Community Benefit Appropriations - CDD Permit Plus Upgrade - Records Management Deposit - Oil Fields Maintenance & Repair - Tidelands - Harbor Resources Consulting - Tidelands - Pavement Restoration Newport Heights - Contributions Fiscal Stewardship - OPEB Contribution to CERBT Public Safety - CAD /RMS ( Police) - IT Strat Fund Component - Para medic Training /Education - START Reserves - Police Facility HVAC Replacement- Facilities Maintenance FUNDS AVAILABLE $ 105,000 $ 348,000 $ 300,000 $ 2,709,620 $ 200,000 $ 220,508 $ 120,000 $ 4,003,128 $ 100,000 $ 120,000 $ 298,000 $ 50,000 $ 105,000 $ 2,709,620 $ 100,000 $ 220,508 $ 300,000 SUBTOTAL $ 4,003,128 REMAINING AMOUNTOTHER FUNDS $ - City of Newport Beach BUDGETAMENDMENT 2013 -14 EFFECT ON BUDGETARY FUND BALANCE: X Increase Revenue Estimates % Increase Expenditure Appropriatona % Transfer Budget Appropriations SOURCE: X from existing budget appropriations X from additional estimated revenues X from unappropriated fund balance EXPLANATION: This budget amendment is requested to provide for the following: To transfer and appropriate General Fund Unassigned Reserves. ACCOUNTING ENTRY: BUDGETARY FUND BALANCE Fund Account 010 3605 010 2263 010 3758 230 3605 480 3605 605 3605 816 3605 631 3605 642 3605 REVENUEESTIMATES (3601) Fund0vision Account 480 6000 605 6000 615 6000 631 6000 542 6000 414 6000 2900 4641 250 5901 230 5860 EXPENDITURE APPROPRIA TIONS (3603) NO. BA- 1481 AMOUNT: $14,558,009.00 Increase in Budgetary Fund Balance Decrease in Budgetary Fund Balance X 1 e No effect on Budgetary Fund Balance General Fund - Fund Balance General Fund Reserve - Records Management General Fund Reserve - START Video Tidelands Fund - Fund Balance Facilities Maintenance Fund - Fund Balance General Liability Fund - Fund Balance 800 MHz Radio Fund - Fund Balance Retiree Insurance Reserve Fund - Fund Balance R Strategic Fund - Fund Balance Description Facilities Maintenance Fund - Transfer In General Lability Fund - Transfer In 800 MHz Radio Fund - Transfer In Retiree Insurance Reserve Fund - Transfer In IT Strategic Fund - Transfer In LG Headquarters Fund - Transfer In CDD Building - Records Mgml Fee Contributions Fund - Private Contributions Tidelands Fund - Damage to City Property Signed: Amount Debit Credit $12,714,231.00 ' $120,000.00 $120,000.00 $220,508.00 $300,000.00 $300,000.00 $1,000,000.00 ' $3,000,000.00 $230,270.00 $500,000.00 ' $1,500,000.00 $200,000.00 ' $1,000,000.00 $3,000,000.00 $500,000.00 $1,500,000.00 $220,000.00 $100,000.00 $120,000.00 $105,000.00 $48,000.00 $15,000.00 $400,000.00 $338,000.00 $26,550.00 $351,250.00 $251,106.00 $16,700.00 $12,500.00 $54,956.00 $150,000.00 $136,000.00 $140,000.00 $912,675.00 $125,000.00 $100,000.00 $125,000.00 $50,000.00 $298,000.00 $100,000.00 $120,000.00 $41,000.00 $159,000.00 $260,000.00 $300,000.00 $750,000.00 $2,500,000.00 $1,000,000.00 $105,000.00 $100,000.00 $6,220,000.00 $230,270.00 ;�-Iq -ry Data 1ii�e Signed: City Council Approval: City Clerk Data Description Divison- Account 0110 -8250 Council - Special Dept Exp(NMUSD Conti Divison - Account 2320 -7042 Fire Operations - OveNme Planned Divison- Account 2320 -7046 Fire Operations - FLSA Of Division-Account 2340 -7042 Fire EMS- Overtime Planned Divison - Account 2340 -8088 Fire EMS - Services Contract Divison - Account 2340 -8111 Fire EMS- Telecomm Datelines Divison - Account 2340 -9400 Fire EMS - Furniture Divison - Amount 2710 -8080 CDD Planning- Services Prof B Tech (BV Parking) Divison - Account 3120 -8080 MOD Facilities Mainl- Services Professional B Tech Divison - Account 3120 -8116 MOD Facilities Maintenance- Tithes Electrical Divison - Account 3150 -8020 MOD Refuse - Automotive Fuel Divison- Accouni 3150 -8080 MOO Refuse- Services Professional B Technical Divison - Account 3150 -8250 MOD Refuse - Special Department I (Dump Fees) Divison - Account 3170 -8080 MOD Parks- Services Professional B Techncial Divison - Account 3180 -8080 MOD Street Trees- Services Professional B Tech Divison - Account 3180 -80806 MOD Street Trees- Tree Reforestation Divison - Account 5060 -8080 Harbor Resources- Services Professional 8 Tech Divison - Amount 5400 -8160 Oil &Gas - Maintenance B Repair NOG Divison - Amount 6420 -9311 IT Strategic - Hardware Divison - Account 6420 -9316 IT Strategic- Permits Plus Upgrade Divison - Account 6422 -8080 IT Strategic CADIRM6- Services Professional B Tech Divison - Account 6422 -9311 R Strategic CADIRMS - Hardware Divison - Account 7011- CIO02032 General Fund CIP - Civic Center Incidentals Divison - Account 7011- CIO02046 General Fund CIP - Police Dept Hi Replacement Divison - Account 7013- C2201000 StreeOight Replacement Prog Divison - Amount 7013- C2202074 Ocean Blvd. Concrete Pavement Replacement Divison- Amount 7013- CZ202075 Concrete All Replacement in Newport Heights Divison- Account 7251- C2002073 IRIND Pavement Restoration Project in SA Heights Dlvison-ACmppt 7414- CIO02047 LG Headquarters CIP - Furniture Divison- Account 9010 -9900 Non Dept General Fund - Transfer Out Divison- Account --, 9619 -8080 L,G 800 MHz- Services Professional B Technical Signed: Amount Debit Credit $12,714,231.00 ' $120,000.00 $120,000.00 $220,508.00 $300,000.00 $300,000.00 $1,000,000.00 ' $3,000,000.00 $230,270.00 $500,000.00 ' $1,500,000.00 $200,000.00 ' $1,000,000.00 $3,000,000.00 $500,000.00 $1,500,000.00 $220,000.00 $100,000.00 $120,000.00 $105,000.00 $48,000.00 $15,000.00 $400,000.00 $338,000.00 $26,550.00 $351,250.00 $251,106.00 $16,700.00 $12,500.00 $54,956.00 $150,000.00 $136,000.00 $140,000.00 $912,675.00 $125,000.00 $100,000.00 $125,000.00 $50,000.00 $298,000.00 $100,000.00 $120,000.00 $41,000.00 $159,000.00 $260,000.00 $300,000.00 $750,000.00 $2,500,000.00 $1,000,000.00 $105,000.00 $100,000.00 $6,220,000.00 $230,270.00 ;�-Iq -ry Data 1ii�e Signed: City Council Approval: City Clerk Data City of Newport Beach BUDGET AMENDMENT 2013 -14 EFFECT ON BUDGETARY FUND BALANCE: Increase Revenue Estimates Increase Expenditure Appropriations Transfer Budget Appropriations SOURCE: from existing budget appropriations X from additional estimated revenues from unappropriated fund balance EXPLANATION: NO. BA- 14BA -033 AMOUNT: $2,821,196.00 �X Increase in Budgetary Fund Balance Decrease in Budgetary Fund Balance No effect on Budgetary Fund Balance This budget amendment is requested to provide for the following: To increase revenue estimates due to revised General Fund year -end revenue projections. ACCOUNTING ENTRY: BUDGETARY FUND BALANCE Fund Account 010 3605 REVENUE ESTIMATES (3601) Fund /Division Account Description General Fund - Fund Balance Description 9010 4000 Secured Property Tax 9010 4005 Unsecured Property Tax 9010 4016 Supplemental Taxes 9010 4026 Property Transfer Tax 9010 4400 City Sales and Use Tax 9010 4001 Property Tax - In Lieu of Sales Tax 9010 4405 Transient Occupancy Tax (TOT) 9010 4005 Transient Occupancy Tax (TOT) 9010 4021 RDA Residual 9010 4403 UTOT Residential Tax - CVB Payments 9010 4408 Conference and Visitor's Bureau EXPENDITURE APPROPRIATIONS (3603) Signed: 0 Signed: Description Approval: Approval: City Amount Debit Credit $2,821,196.00 $738,779.00 $181,515.00 $812,604.00 $679,025.00 $20,261.00 $7,045.00 $1,131,598.00 $65,923.00 $600,000.00 $11,866.00 $203,688.00 Date �Q Date Signed: City Council Approval: City Clerk Date City of Newport Beach NO. BA- 14BA -034 BUDGET AMENDMENT 2013 -14 AMOUNT: s92z,s4s.z7 EFFECT ON BUDGETARY FUND BALANCE: Increase Revenue Estimates Number Increase in Budgetary Fund Balance Increase Expenditure Appropriations Decrease in Budgetary Fund Balance X Transfer Budget Appropriations X No effect on Budgetary Fund Balance SOURCE: from existing budget appropriations from additional estimated revenues from unappropriated fund balance EXPLANATION: This budget amendment is requested to provide for the following: To transfer expenditure appropriations for personnel transfers and operating expenditures from MOD's Parks and Operations Support divisions to the new MOD Facilities Maintenance division. ACCOUNTING ENTRY: BUDGETARY FUND BALANCE Fund Account REVENUE ESTIMATES (3601) FundfDlAsion Account EXPENDITURE APPROPRIATIONS (3603) Description Debit Credit Description Description Division Number 3170 GS - Parks Account Number 80683 Contract Services - Facil6ies /Parks $76,746.00 Division Number 3140 GS- Operations Support Account Number 7000 Salaries - Mike $427,731.20 Account Number 7425 Medicare Fringes $5,257.63 Account Number 7439 PERS Misc BE Contribution $4,149.00 Account Number 7440 PERS Misc ER Contribution $66,392.26 Account Number 7210 HealtNDentaWision $109,152.00 Account Number 7290 Life Insurance $630.00 Account Number 7295 Employee Assistance Program $137.52 Account Number 7373 Compensated Absences $14,970.58 Account Number 7227 RHS $2.50 Contribution $7,020.00 Account Number 7114 Cell Phone Stipend Exp $1,500.02 Account Number 8116 Utilities - Electricity $100,000.00 Account Number 8081 Services - Janitorial $100,000.00 Account Number 8080 Services - Prof /Tech NOD $8,860.00 Division Number 3120 Facilities Maintenance Account Number 7000 Salaries - Misc $427,731.20 Account Number 7425 Medicare Fringes $5,257.63 Account Number 7439 PERS Misc EE Contribution 54,149.00 Account Number 7440 PERS Misc ER Contribution $66,392.26 Account Number 7210 Health/DentaWision $109,152.00 Account Number 7290 Life Insurance $630.00 Account Number 7295 Employee Assistance Program $137.52 Account Number 7373 Compensated Absences $14,970.58 Account Number 7227 PHIS $2.50 Contribution $7.020.00 Account Number 7114 Cell Phone Stipend Exp $1,500.02 Account Number 8116 Utilities - Electricity $100,00100 Account Number 8081 Services - Janitorial $100,000.00 Account Number 8080 Services - Prof/Tech NOC $8,860.00 Account Number 80883 Contract Services - Facilities /Parks $76,746.00 - Automatic System Ent, Signed: / C� ! — T / Fhk Appr Kal MI, ncce` Director Date Signed: ��v✓�- �' ""U� �'l l 1` Atlministralwl) Approval: City Manager Date Signed: City Council Approval: City Clerk Date