Item 24 - Fiscal Year 2022-23 Mid-Year Budget Update

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Fiscal Year 2022-23 Mid-Year Budget Update, Revive Spending Plan Update, Appropriation Requests, and Workforce Changes March 21, 2023 Page 7 3 3 1 7 Annual Prayer Breakfast and Orange County Pride Parade & Festival Sponsorship As an informational update, other entities and private parties in the City will fund an annual Prayer Breakfast, likely in May. Therefore, we no longer request an appropriation adjustment. The City received a donation request for the Orange County Pride Parade & Festival held in Santa Ana in June. Staff requests an appropriation of $30,000 to sponsor the event. Third & Broadway Development – Informational Only On October 5, 2020, the City entered into a development agreement with Caribou Industries for the Third & Broadway property. The development project includes a residential tower with 171 apartment units (including 17 affordable units), 13,419 square feet of commercial space, and a ten-story parking garage with 212 public parking spaces, 196 residential parking spaces, and 37 hotel valet parking spaces. The project also includes a hotel tower with a 75-room hotel and 83 non-valet parking spaces. The development agreement obligates the City to loan up to $13 million to demolish the existing parking garage, prepare the site with a rough grade, construct 212 of the public parking spaces, and reconstruct Sycamore to reconnect 3rd and 4th Streets. The developer recently completed all contractual requirements to secure the $13 million funding from the City. Based upon new information regarding the timing of project construction, staff will include the $13 million contractual obligation in the FY 2023-24 proposed budget. There is no appropriation request at this time. Housekeeping Adjustments for Labor Agreements – Informational Update As part of the FY 2022-23 General Fund budget, the City Council appropriated $5 million for any wage increases associated with labor negotiations, within the Non- Departmental section of the budget. On November 15, the City Council approved a labor agreement with the Police Management Association with an estimated fiscal impact that would use $152,606 of the $5 million appropriation. On November 15, the City Council approved a labor agreement with the Part-Time Service Employees International Union with an estimated fiscal impact that would use $377,075 of the $5 million appropriation. On December 20, the City Council approved the last, best and final offer for the Police Officers Association with an estimated fiscal impact that would use $1,325,365 of the $5 million appropriation. All three staff reports indicated that we would propose housekeeping adjustments at Mid-Year to allocate from the Non-Departmental section into the affected department programs. Housekeeping adjustments do not require additional appropriations; the housekeeping adjustments are merely used to facilitate streamlined accounting of related expenditures. At this time, staff will proceed without the housekeeping adjustments.