Title
Adoption of Resolution Amending the Fiscal Year 2022-23 Budget; and
Adoption of Resolution Approving Workforce Changes for Fiscal Year 2022-23. (Finance 10024056)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
This report provides a review and an update to the Fiscal Year (FY) 2022-23 budget and revenue and expenditure projections through June 30, 2023. Budget adjustments are proposed for the General Fund, special revenue funds, capital projects funds, internal service funds, and trust/fiduciary funds. The proposed adjustments would increase the General Fund revenue projection by $7.4 million, from $122.9 million to $132.1 million, and increase the General Fund operating expenditure budget by $0.8 million, increase capital transfers out of the General Fund by $1.0 million, and appropriate $2.8 million per the Pension & Other Post-Employment Benefits (OPEB) Funding Policy for total expenditures of $131.1 million.
For non-General Fund programs, staff project an increase in revenues of $927,235 excluding transfers-in, and propose an additional $8,331,116 in expenditure appropriations, excluding transfers out.
Further, staff recommends the addition of one new position, conversion of one limited-term position to permanent, increasing two positions currently allocated at 80% to 100%, and four position upgrades.
BACKGROUND
The City Council adopted the Biennial Budget for FYs 2021-22 and 2022-23 on June 15, 2021 and adopted a Mid-Cycle Budget Update for FY 2022-23 on June 21, 2022. This report updates the FY 2022-23 financial projections for the General Fund and proposes current year budget adjustments for various City of Alameda (City) funds to reflect and respond to the City’s current financial condition, address urgent and unforeseen needs, and incorporate technical correction.
The list of the proposed Mid-Year FY 22-23 budget adjustments to the General Fund and other funds is attached as Exhibit 1 and the updated General Fund Budget Summary is attached as Exhibit 2.
DISCUSSION
I. General Fund Revenues
General Fund revenues in FY 2022-23 are projected to increase by $1,893,400 in ongoing funds and $7,369,313 in one-time funds to a total of $132.1 million. Staff recommend the following changes to General Fund revenue forecast:
• A1. Receive $7,480,313 of American Rescue Plan Act of 2021 (ARPA) Revenue Replacement funds in the General Fund. Pursuant to City Council direction provided on October 18, 2022, the General Fund will receive $7,480,313 in one-time ARPA funds in FY 2022-23.
• A2. Increase Property Tax by $1,490,000 to $54,750,000 based on updated projections from the City’s property tax consultant, HdL. Secured and Motor Vehicle License Fee In-Lieu property tax is expected to increase 10% over the FY 2021-22 actuals due to the maximum possible Proposition 13 increase in assessed valuation of 2% plus higher assessed valuations resulting from changes of ownership.
• A3. Increase Utility Users Tax, which is charged on utility bills, by $400,000 to $9.6 million. This increase is due to a substantial year-over-year increase in natural gas prices and is not expected to continue as gas prices stabilize.
• A4. Increase Transient Occupancy Tax by $400,000 to $2.8 million due to the ballot measure approved by voters in November 2022 to increase the City’s Transient Occupancy Tax rate from 10% to 14%. The new rate went into effect in January 2023 and is expected to generate an additional $400,000 for the last six months of the fiscal year.
• A5. Increase Business License Tax by $400,000 to $2.7 million. Business License Tax collections occur at the start of the fiscal year, and year-to-date actuals are $400,000 above budget.
• A6. The Infrastructure Mitigation revenue of $860,000 was presented in two funds: the General Fund (misallocation) and the special revenue fund (proper allocation) as part of the FY 2022-23 Budget adoption. This forecasted revenue needs to be removed from the General Fund revenue forecast as it should be housed in the special revenue fund per the franchise agreement.
• A7-A11. Reduce Fire Program Revenues by $47,600 largely due to a decrease in apartment and commercial fire inspections compared to what was anticipated.
II. General Fund Operating Expenditures
Operating expenditures in total and by department are tracking at or below 50% of the annual budget through the first six months of the year.
The following General Fund expenditure budget adjustments total an increase in requested appropriations of $1,834,697, of which $802,697 are for operational needs and $1,032,000 are for capital needs.
B1. Community Development - Homelessness - $125,000
Funding for the Day Center and Safe Parking programs was included in the FY 2021-23 budget as one-time funding only in FY 2021-22. However, these programs are continuing through FY 2022-23 under a previously approved contract with the service provider, Village of Love.
B2. Fire - EMS Certifications/Licenses - $14,500
The Emergency Medical Services (EMS) Division is responsible for assuring that EMS certifications/licenses for all sworn staff are renewed and current. This includes Paramedic, EMT, ACLS, PEPP, PHTLS and CPR certificates/licenses. After reviewing and determining the number of required re-certifications/renewals needed in the current fiscal year, additional one-time funding is needed to cover the associated cost for these required certificates/licenses.
B3. Fire - Ground Emergency Medical Transport (GEMT) Cost Reports - $30,240
The GEMT Program provides additional funding to eligible governmental entities that provide GEMT services to Medi-Cal beneficiaries, such as the Alameda Fire Department. The State Department of Health Care Services (DHCS) notified the City in May 2022 that they will be resuming acceptance of Ground Emergency Medical Transportation (GEMT) cost report submissions for the GEMT Certified Public Expenditure Supplemental Reimbursement Program. This involves preparing and submitting GEMT Cost Reports for FYs 2018-19 through FY 2021-22. Due to the complexity and short time frame to prepare and submit the Cost Reports for each of the four fiscal years, an outside consulting agency was hired to provide these services. Additional one-time budget is needed to cover two of the four years of cost reports. Preparation of the cost reports should result in additional reimbursements to the General Fund for GEMT services provided over the last four years.
B4. Fire - Public Provider Ground Emergency Medical Transport (PPGEMT) Program Setup - $300,000
Effective January 2023, DHCS implemented a new reimbursement methodology for the previous GEMT program. The new PPGEMT program will increase the fee-for-service reimbursements for eligible emergency medical transports but requires initial estimated quarterly payments to DHCS of $130,000. Initial funding of $300,000 from the General Fund is requested to make the initial two quarterly payments to DHCS. The initial payments are estimated and could be higher. When the fee-for-service reimbursement is received from DHCS, staff will refund the General Fund, and the remaining revenues will be deposited in a newly established PPGEMT Fund (224) and used to cover the costs of emergency medical transports.
B5. Fire - Medical Director - $13,200
The Alameda Fire Department and the University of California San Francisco (UCSF) entered into a Medical Director Agreement to provide a UCSF Physician to serve as the director of the Division of Emergency Medical Services. Increased guidance and oversight of the Community Assessment Response & Engagement (CARE) Team pilot program has resulted in higher usage of the Medical Director service. Compensation is based on an hourly rate and the Alameda Fire Department has projected the need for additional funds to cover services through June 30, 2022.
B6. Fire - Recruitment Expenses - $48,500
The Fire Department is currently conducting recruitment for entry-level and lateral Firefighter positions to fill an anticipated 18+ vacancies by the end of the fiscal year due to anticipated promotions and retirements. The current available budget for recruitment activities does not provide for completing the necessary preemployment processes to include Oral Boards, Chiefs Interviews, LiveScan, Background Investigations, Psychological Exams and Medical Exams. The cost to complete the preemployment process is approximately $3,500 for each candidate.
B7. Fire - Re-Establish CERT Budget - $21,000
The Community Emergency Response Team (CERT) course provides training to Alameda residents and employees of Alameda businesses to help increase self-sufficiency in the event of a disaster. The annual operating expenses for the program are approximately $33,000, of which $12,000 is covered annually through the Homeland Security Grant Program. This budget was not re-established when the financial system was transferred from the legacy system to the new TylerMunis system. Staff proposes using a General Fund transfer to cover the costs of supplies for running the program and using the grant funding for firefighter overtime spent on training CERT volunteers. Since the program also receives donations from community members, staff proposes using the General Fund to cover costs not covered by donations and the grant.
B8. Fire - Self-Contained Breathing Apparatus (SCBA) Bottle Replacements - $14,300
The Alameda Fire Department’s 60-minute SCBA bottles for Truck 1, Truck 2, and Rescue 3 B74 have reached a full-service life of 15 years and are expired. There is a total of nine 60-minute bottles that need to be replaced prior to end of this fiscal year.
B9. Fire - Update Fees for Service - $10,000
The Alameda Fire Department in coordination with Public Works, and Planning, Building and Transportation have contracted with the consultant, NBS, to provide services to update the Fees for Services for each department. The requested amount is the Alameda Fire Department's share of the contract for services.
B10. Police - Patrol/Traffic Maintenance Contracts Update - Net $0
Additional budget is needed in the Police Department’s Patrol/Traffic budget to cover costs associated with the recently executed contracts with Public Safety Family Counseling Group, Flock Safety, and Truleo. Staff proposes using vacancy savings to cover the maintenance contract expenses, as discussed in the staff report for the previously approved Flock Safety agreement (see File 2022-2301).
B11. Public Works - Streetlight Electricity - $10,000
Projected electric bill actuals are above the original estimate included in the budget.
B12. Public Works - Streetlight Materials - $60,000
Additional budget for streetlight materials is needed through the end of the fiscal year due to copper wire theft, broken historic globe fixtures on Webster Street, and the increasing price of electrical parts.
B13. Recreation & Parks - Emma Hood Swim Center Maintenance Update - $141,457
When the FY 2022-23 budget was prepared, staff assumed that the Emma Hood Swim Center would not be operating in the current fiscal year per direction from the Alameda County Health Department to close in May 2022 in the previous fiscal year. However, the facility closing was extended to December 2023, so the City owes additional payment to Alameda Unified School District for maintenance of the Emma Hood Swim Center per the Joint Use Agreement. Additionally, the annual payment was $85,000 higher than the previous year, which was unanticipated. In FY 2020-21, the payment was $171,000 and for FY 2021-22 the City’s payment for 50% of operation and maintenance costs was $256,000.
B14. Recreation & Parks - Stolen Trailer and Equipment Replacement - $14,500
Due to theft of a Recreation program trailer and equipment, additional budget is needed for the replacement. The trailer and equipment are utilized for teen programming and fundraising.
B15. Public Works - Facilities Capital Transfer - $508,000
Staff proposes transferring $508,000 from the General Fund to the Facilities Replacement Internal Service Fund for urgent, unforeseen capital projects at City facilities, discussed further under items C43 through C48.
B16. Recreation & Parks - Capital Transfer - $524,000
Staff proposed transferring $524,000 from the General Fund to the Capital Projects Fund for two Parks projects, discussed further below under items C37 and C39.
III. Pension/OPEB Funding Policy
The proposed General Fund expenditure adjustments includes the City’s discretionary Pension/OPEB contribution, which is estimated based on the FY 2021-22 year-end results. Through the City’s Pension/OPEB Funding Policy, the City commits additional funds as available at the end of each year to pay down pension/OPEB obligations in advance. Specifically, if a General Fund surplus exists from the prior year (FY 2021-22), then 50% of the General Fund surplus is to be used in the following manner: 75% shall be used to reduce CalPERS unfunded liability and 25% shall be contributed into the City’s Public Agency Retirement Services (PARS) Section 115 Irrevocable Trust.
The General Fund surplus for the end of FY 2021-22 was $5,625,792, thus by policy the City commits $2,812,896 to advance payment of Pension/OPEB obligations. By policy, 75%, or $2,109,672, will be paid directly to CalPERS, and 25%, or $703,224 is contributed to the Section 115 trust for the future payment of pension or OPEB expenses.
With the proposed budget amendment and pre-payment to CalPERS, the City would (1) realize budget savings in future years as the liabilities are reduced, and (2) mitigate the risk of growing payment obligations crowding out the allocation of General Fund tax dollars to current services and programs.
IV. Non-General Fund Programs
In addition to the General Fund amendments discussed above, the following adjustments are proposed for programs outside of the General Fund. These adjustments are included in the list of budget adjustments presented on Exhibit 1.
C1, C54. Fund 101 Police/Fire Pension 1079 - Closed Pension Plan Transfer
This fund accounts for the payment of pension benefits enacted under closed pension plan #1079. Contributions transferred from the General Fund provide current year pay-as-you-go benefits for retirees and qualified beneficiaries covered by this fund. As beneficiaries of the closed plan pass away, the fund accumulates excess resources that are periodically transferred by policy to the City’s Pension Reserve (Fund 720), which may be used for future payment of pension obligations. Staff proposes transferring $2,200,000 in excess funds from Fund 101 to Fund 720.
C2. Fund 203 CDBG - Upgrade Community Development Program Manager to Community Development Manager
The Community Development Department requests an upgrade of an existing Community Development Program Manager position to the Community Development Manager classification, which is commensurate with the complexities of the work and higher-level management and coordination of citywide activities assigned to the position. The annual cost of the upgrade would be approximately $35,000. No additional budget is needed in the current fiscal year.
C3. Fund 207 Rent Program - Upgrade Administrative Technician II to Paralegal
The City Attorney’s Office requests an upgrade of an existing Administrative Technician II position to Paralegal to reflect the complexity of assigned duties, including drafting and reviewing legal documents and supporting the provision of complex housing mediation services. The annual cost of the upgrade would be approximately $15,000. No additional budget is needed in the current fiscal year.
C4. Fund 207 Rent Program - Convert 80% Senior Account Clerk to 100% Account Clerk
Rent program fee collections are currently performed by a Senior Account Clerk in the Finance Department allocated 80% to the Rent Program. With the reorganization of the Rent Program from the Alameda Housing Authority (a non-City entity) to the City Attorney’s Office, the City Attorney’s Office is seeking to centralize the fee collection function at the Rent Program office at City Hall West. This position change would be budget neutral to the Rent Program because 100% of the Account Clerk classification is comparable in personnel costs to 80% of the Senior Account Clerk classification.
C5. Fund 209 Planning, Building & Transportation - Upgrade Assistant City Attorney II to Chief Planning Counsel
The City Attorney’s Office requests an upgrade of an existing Assistant City Attorney II position to Chief Planning Counsel to reflect the complexity of land use and environmental legal expertise required. The annual cost of the upgrade would be approximately $6,000. No additional budget is needed in the current fiscal year.
C6. Fund 209 Planning, Building & Transportation - Permanent Senior Transportation Coordinator
The Planning, Building & Transportation Department has a limited-term Senior Transportation Coordinator position that was funded for a two-year period through the end of FY 2022-23. During the two-year period it has become apparent that the position needs to be a permanent position to meet City Council transportation goals and objectives. Elimination of this position will represent a 33% reduction in Transportation Planning for the City of Alameda. This position is funded through Measure BB funds, which is a permanent funding source. No additional budget is needed in the current fiscal year. The annual ongoing cost of the position is approximately $194,000.
C7. Fund 216 Tidelands - Seaplane Lagoon Ferry Terminal Wayfinding Signs
Installation of wayfinding signage for the recently opened Seaplane Lagoon Ferry Terminal is a one-time expense estimated at $100,000. This use is compliant with Tidelands fund use restrictions.
C8. Fund 220 Fire Grants - Re-Establish CERT Budget
As discussed above under item B7, the annual operating expenses for the CERT program are approximately $33,000, of which $12,000 is covered annually through the Homeland Security Grant Program. Expenses would be accounted for in the Fire Grants budget due to the use of the federal Homeland Security Grant.
C9. Fund 221 Police Grants - 2020 & 2021 Byrne Justice Assistance Grants (JAG)
The Alameda County Sheriff’s Office applies for the Byrne JAG Local Program on behalf of eligible Alameda County cities and the county. Funding may be used for local initiatives, technical assistance, training, personnel, equipment, supplies, contractual support, and information systems for criminal justice, as well as research and evaluation activities that will improve or enhance law enforcement programs related to criminal justice. The City of Alameda’s allocations for 2020 and 2021 are $11,357 and $13,504, respectively, for a total of $24,861. The Police Department proposes to use the funding for computer equipment purchases.
C10. Fund 222 Grants - ABAG REAP Grant
The Association of Bay Area Governments (ABAG) has sub-awarded $58,058 in Regional Early Action Planning (REAP) state grant funds to the City of Alameda that can be used to reimburse expenses for the City’s Housing Element program.
C11. Fund 222 Grants - Solar Permitting Grant
The California Energy Commission awarded a $60,000 grant to the City of Alameda for implementing the SolarAPP+ software for expediting building permit approvals for eligible rooftop solar systems.
C12. Fund 222 Grants - State Historic Preservation Grant
The State Department of Parks and Recreation awarded a $4,000 grant to the City of Alameda that may be used for the historic preservation program.
C13, C14, C16-C22. Fund 230-5 Measures B/BB - Revenue Correction
County Measure B, a ½ cent transportation sales tax, sunset at the end of March 2022, but the revenues were erroneously budgeted for FY 2022-23. When County Measure B sunsetted, Measure BB increased from a ½ cent to 1 cent, effectively capturing the same amount of revenue for the same transportation-related uses. The proposed revenue corrections re-program the projected FY 2022-23 funding from the Measure B funds to the Measure BB funds and update the revenue budgets based on the latest projections from the Alameda County Transportation Commission.
C15, C34. Fund 231 Measure BB Local Streets/Roads - Transfer to Posey/Webster Tube Sea Level Rise Project
Caltrans awarded a $425,000 grant to the City of Alameda that requires a $75,000 local match for the Posey/Webster Tube Sea Level Rise project (see File 2022-2076). Staff propose using Measure BB Local Streets/Roads funds for the local match. The grant funds would be received and tracked in the Capital Projects Fund (310).
C23, C40. Fund 250 Golf - Golf Parking Lot ADA Improvements
Per a legal settlement, the City is required to make specified improvements at the Corica Park Golf Course parking lot which requires a one-time allocation of $277,000 from the Golf Fund.
C24. Fund 265 Parking - New Parking Program Manager
Public Works is requesting to add a Parking Program Manager position to oversee the recently re-organized parking enforcement, parking meters, and parking garage divisions. This position will be responsible for multiple operating budgets, supervision of staff, and oversight of maintenance contracts and execution of capital work, including improvements in the parking garage to increase revenue. The position would be funded by parking fund revenues. Assuming an April 1 start date, the costs through the end of the fiscal year would be approximately $55,000, and approximately $220,000 annually.
C25. Fund 271 Landscape/Lighting District 84-2 Zone 4 - Technical Corrections
Public Works proposes one-time allocations of $10,000 for repayment of the Business Improvement Area Board contribution to 2019-20 balloting, and $50,000 for holiday decorations. These funds would be appropriated from fund balance.
C26. Fund 274 Landscape/Lighting District 84-2 Zone 7 - Tree Testing, Removal, and Replacement
Public Works proposes one-time allocations of $10,000 for the planned repayment of the Zone 4 Business Improvement Area Board contribution to 2019-20 property owner balloting to increase assessments, and $50,000 for replacement of old holiday decorations. These funds would be appropriated from fund balance and were planned for during the annual assessment setting process.
C27. Fund 290 Alameda Point - Alameda Point/Base Reuse Commission Fees
Due to recent solicitation of leases at Alameda Point, the City anticipates needing to pay up to $1,740,000 in commission fees by the end of the fiscal year, subject to execution of the lease agreements, for the following properties:
• Building 39 - anticipated commission $740,000
• Building 11 - anticipated commission $709,000
• Building 169 - $69,000
• Building 19 - $160,000
• Building 360 - $37,000
• Pier 3 and Pier 1 - existing invoices for $25,000
C28, C32. Fund 290 Alameda Point - Alameda Point Adaptive Reuse Backbone Infrastructure
Public Works proposes a one-time allocation of $925,000 from the Alameda Point Fund for Phase 2 and 3 of design services for backbones infrastructure for the Alameda Point Adaptive Reuse Area. Project expenses would be tracked in the Alameda Point Capital Projects Fund (301).
C29. Fund 290 Alameda Point - Seaplane Lagoon Ferry Terminal Project Closeout
The Seaplane Lagoon Ferry Terminal has a total project budget of $23,804,676, with funding sources from county grants, developer contributions, and transfers from the Tidelands and Alameda Point/Base Reuse Funds. Expenses for the completed project totaled $21,607,290, and revenues received total $21,152,977, leaving a project balance of ($454,313). Additional appropriations of $454,313 from the Alameda Point Fund are needed to cover the imbalance as the developer contribution budget was over-estimated when the project was established in 2018.
C30, C33. Fund 290 Alameda Point - Alameda Point Sports Complex DDA Budget Correction
Pursuant to a disposition and development agreement (DDA), $150,000 in Alameda Point funds should have been allocated to the Alameda Point Sports Complex Project (C75300), but these funds were not budgeted. The expenditure budget for the Alameda Point Sports Complex project is subject to future appropriations approval.
C31. Fund 290 Alameda Point - Accounting Technician 20%
The Community Development Department is allocated 80% of a full-time equivalent (FTE) Accounting Technician position, which recently became vacant. To fill the vacancy, staff propose to expand the allocation by 20% from 80% to 100% for 1.0 FTE Accounting Technician. No additional budget is needed through the end of the fiscal year for the additional allocation, and the annual ongoing cost would by $22,000.
C35. Fund 310 Capital Projects - Asphalt Paving CIP Correction
City Council approved a $250,000 allocation for asphalt paving in various parks as part of the FY 2022-23 Mid-Cycle Budget Update. The budget was allocated to the Parks Maintenance capital improvement project (CIP) (C51000) and the Recreation & Parks Department is requesting to transfer the budget to the Parks, Trails, and Sidewalk Repair CIP (C15000) for improved expense tracking. No additional budget is requested.
C36. Fund 310 Capital Projects - Shoreline Park Asphalt and Smart Irrigation CIP Correction
City Council approved allocations of $250,000 and $135,000 for asphalt repairs at Shoreline Park and installation of smart irrigation equipment, respectively, as part of the FY 2021-22 Mid-Year Budget Update. in various parks as part of the FY 2022-23 Mid-Cycle Budget Update. The budget was allocated to the Parks Maintenance CIP (C51000) and the Recreation & Parks Department is requesting to transfer the budget to the Park Irrigation Improvements CIP (C51100) for improved expense tracking. No additional budget is requested.
C37. Fund 310 Capital Projects - Estuary Park Design and Analysis
The Recreation and Parks Department is requesting a one-time allocation of $324,000 from the General Fund for Estuary Park design and environmental analysis. The City was awarded a $2.5 million Land and Water Conversation Fund grant from the California Department of Parks and Recreation. The grantor requires completion of Phase 1 design and environmental clearance prior to construction funded by the grant.
C38. Fund 310 Capital Projects - Sweeney Park Connector Trail Project
The Recreation and Parks Department proposes to re-allocate $134,000 from the Active Transportation Plan Implementation CIP (C63000) to the Cross Alameda Trail Connector CIP (C65010) to cover additional construction costs associated with connecting 8th Street, Wood Street, and two northern points to the Cross Alameda Trail. Most of the project costs were covered by grant funds, but construction costs have increased over the last two years since the grant was submitted. The funding source for the existing allocation to the Active Transportation Plan Implementation CIP (C63000) is Measure BB Local Streets/Roads. No additional budget is requested.
C39. Fund 310 Capital Projects - Sweeney Park Groundwater Remediation
The Recreation and Parks Department is requesting a one-time allocation of $200,000 from the General Fund to complete groundwater remediation activities, as required by the California Department of Toxic Substances Control, at Jean Sweeney Open Space Park.
C41. Fund 310 Public Works Administration - Upgrade Public Works Superintendent to Project Manager III
The Public Works Department requests an upgrade of an existing Public Works Superintendent to Project Manager III, with a working title of Streets/Utilities Manager. The position will be responsible for multiple operating budgets, staff supervision including two supervisors, and execution of project/contract work that is not part of the capital program. The annual cost of the upgrade would be approximately $3,000. No additional budget is needed in the current fiscal year.
C42. Fund 501 Sewer - Sewer Vehicle Replacement
Sewer service activities are tracked in an Enterprise Fund, which means that the financial activities are tracked separately from all other governmental activities in the City’s financial statements. As such, the Sewer program does not participate in the Fleet Replacement Internal Service Fund, so Sewer vehicles are purchased on a pay-as-you-go basis. A vehicle replacement budget for the Sewer Fund (501) was inadvertently left out during budget preparation. City Council previously authorized the purchase of a bucket truck, a crane truck, and a camera van for a combined cost of approximately $634,000 (see File 2023-2690). Public Works also plans to purchase two additional vehicles totaling $67,000 prior to the end of the fiscal year, for a total allocation of $700,000 from the Sewer fund balance.
C43-C48. Fund 603 Facilities Replacement - Various Facilities Projects
Public Works proposes to allocate a total of $508,000 from the General Fund to the Facilities Replacement Internal Service Fund for urgent, unforeseen capital projects at City facilities, including:
• $125,000 for fire restoration at the Harrington Park restroom
• $82,000 for environmental hazard abatement at Fire Station 1
• $68,000 for repairs resulting from a water loss event at the Officers’ Club
• $104,000 for structural repairs at the Officers’ Club
• $52,000 for lead abatement at the Veterans Building
• $77,000 for safety improvements to the Alameda Point Gym
C49. Fund 605 Emergency Operations Center - Share 911 Service
Funding for the City’s Share 911 emergency alert and mass notification service was inadvertently left out of the FY 2022-23. The annual service cost is approximately $11,000 and will be included in future baseline budgets.
C50. Fund 606 Information Technology - Virtual Server Replacement
The City’s current virtualized server infrastructure needs to be upgraded as the hardware is no longer supported. VMWare supports the virtualized server infrastructure at both City Hall and the Emergency Operations Center. The upgrade project will require one-time replacement of hardware and professional services for implementation at a total cost of $350,000, funded by the Information Technology Internal Service Fund. Critical servers such as domain controllers, email servers, and various application servers run using this virtualization technology for efficient shared resource consumption. The new virtual server infrastructure will support a new topology that improves upon business continuity and disaster recovery to increase resiliency in the event of a network, software, or hardware failure or any combination of the three. The upgrade will also result in maintenance contract savings from the removal of dependency on the City’s current storage area network provider.
C51. Fund 606 Information Technology - Implementation of Backup Replacement
The City’s current backup solution needs replacement for improved disaster recovery, business continuity, recovery time objectives, and ransomware defense. Hardware and installation services for the new backup solution is estimated at $101,000, with hardware and installation at a one-time cost of $39,000 and three years of service licenses and system support paid in advance at a cost of $62,000.
C52-C53. Fund 606 Information Technology - Financial Statement Automation
The Finance Department proposes to implement a web-based system for automating preparation of the City’s financial statements. One-time implementation costs are estimated at $75,000 with ongoing annual service of $46,000, or $23,000 for the remainder of the fiscal year, to be funded by the Information Technology Internal Service Fund. Implementation of the proposed system would result in annual savings to the General Fund of approximately $12,000 since the financial statements are currently manually assembled by the City’s external auditor. The proposed system will provide the City with more control over the timing and issuance of financial statements.
C55. Fund 720 Pension Reserve - PARS Administration Correction
The City’s pension and OPEB trust funds are administered by PARS. The annual administrative costs of $47,000 for management of the City’s trust fund investments was inadvertently left out of the FY 2022-23 budget.
V. Workforce Changes
The FY 2022-23 budget includes funding for 492 allocated full-time positions, excluding Alameda Municipal Power. The recommended workforce changes include addition of one new position, conversion of one limited-term position to permanent, increasing two positions currently allocated at 80% to 100%, and four position upgrades, as shown below.
|
Dept |
Request |
+/- FTE |
Annual Cost |
Funding Source |
|
City Atty |
Upgrade Assistant City Attorney II to Chief Planning Counsel |
- |
$6,000; no additional budget needed in FY 2022-23 |
Planning & Building |
|
City Atty |
Upgrade Administrative Technician II to Paralegal |
- |
$15,000; no additional budget needed in FY 2022-23 |
Rent Program |
|
City Atty |
Downgrade 80% Senior Account Clerk to 100% Account Clerk |
+0.2 |
Cost neutral |
Rent Program |
|
Comm Dev |
Upgrade Community Development Program Manager to Community Development Manager |
- |
$35,000; no additional budget needed in FY 2022-23 |
CDBG, HOME, Affordable Housing, Successor Agency |
|
Comm Dev |
Add 20% Accounting Technician |
+0.2 |
$22,000; no additional budget needed in FY 2022-23 |
Alameda Point |
|
PBT |
Convert Limited-Term Senior Transportation Coordinator to Permanent |
+1.0 |
$194,000; no additional budget needed in FY 2022-23 |
Measure BB |
|
Pub Works |
Add Parking Program Manager |
+1.0 |
$220,000; $55,000 for remainder of FY 2022-23 |
Parking |
|
Pub Works |
Upgrade Superintendent to Project Manager III |
- |
$3,000; no additional budget needed in FY 2022-23 |
Sewer, Stormwater, Streets/Roads |
The effective date of approved workforce changes would be February 26, 2023 pending City Council approval.
ALTERNATIVES
• Authorize the budget amendments and workforce changes proposed in the staff report.
• City Council may take no action, in which case the previously adopted and revised FY 2022-23 budget and authorized positions would remain in effect.
• City Council may provide further direction on these proposed budget amendments and workforce changes.
FINANCIAL IMPACT
The proposed FY 2022-23 budget adjustments will increase the General Fund revenue projection by $1,893,400 in ongoing funds and $7,369,313 in one-time funds to $132.1 million in total. The proposed expenditure adjustments include $802,697 in additional operating expenditures, $1,032,000 in capital transfers, and $2,812,896 towards pension and OPEB per the Pension/OPEB Funding Policy, for total expenditures of $130.1 million. Staff project a General Fund surplus (revenues in excess of expenditures) of approximately $2.1 million at year end.
The General Fund residual unassigned fund balance at the end of FY 2021-22 was $40.2 million at the end of FY 2022-23. With the General Fund’s proposed mid-year operating expenditure budget of $131.1 million and projected revenues of $132.1 million, the General Fund reserve would be $28.7 million, leaving a projected residual unassigned fund balance of $36.6 million at year-end.
The General Fund 5-year forecast will be presented as part of the FY 2023-25 Biennial Budget workshops with City Council in spring 2023.
The net impact of the proposed adjustments on all other funds will be an increase in the revenue projection by $927,235 and additional expenditure authority of $8,331,116, excluding interfund transfers.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action is in conformance with the Alameda Municipal Code and all policy documents.
ENVIRONMENTAL REVIEW
This action does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
CLIMATE IMPACT
There are no climate impacts associated with this action; implementation of the Climate Action and Resiliency Plan continues to move ahead with available funding.
RECOMMENDATION
Adopt a resolution amending the fiscal year 2022-23 budget; and adopt a resolution approving workforce changes for fiscal year 2022-23.
Respectfully submitted,
Margaret O’Brien, Finance Director
By,
Jennifer Tell, Budget Manager
Exhibits:
1. FY 2022-23 Mid-Year Budget Adjustments
2. General Fund Budget Summary