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Home My WebLink About55F - RESO - ESTABLISH APPROPRIATION LIMITREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: JUNE 18, 2012 CLERK OF COUNCIL USE ONLY: TITLE: APPROVED ? As Recommended RESOLUTION ESTABLISHING THE ? As Amended APPROPRIATION LIMIT OF ? Ordinance on 151 Reading ? Ordinance on 2"d Reading THE CITY OF SANTA ANA FOR ? Implementing Resolution FY 2012-13 ? Set Public Hearing For_ CITY MANAGER RECOMMENDED ACTION CONTINUED TO FILE NUMBER Adopt a resolution establishing the appropriation limit for the fiscal year 2012-13. DISCUSSION The State of California Constitution includes provisions, which impose a limit ("the Gann Limit") on tax proceeds that may be appropriated for expenditures by a local government in any given fiscal year and requires the cities establish this limit by resolution. Adoption of the subject resolution is necessary for compliance with these provisions for the fiscal year ending June 30, 2013. As detailed in the exhibits to the subject resolution, the City's spending limitations from "Proceeds of Taxes" is calculated to be $837,149,351 (Exhibit A) for FY 2012-13. This represents the permitted growth rate factor of 24.8852 times the adjusted base year (1978-1979) appropriation limit of $33,640,451. Exhibit B identifies the factors used to determine the allowable increase; Exhibit C categorizes FY 2012-13 anticipated revenues from "Proceeds of Taxes" and "Non- Proceeds of Taxes"; and Exhibit D computes the fiscal year 2012-2013 appropriations subject to this limitation and identifies the difference between the limit and the budgeted appropriation. As demonstrated in Exhibit D the City's anticipated FY 2012-13 "Proceeds of Taxes" revenue will be $711,517,168 below the allowable limit. FISCAL IMPACT There is no fiscal impact associated with this action. "A NrAl`x\ ?, (° -mil a . V A Q Francisco Gutierrez Executive Director Finance and Management Services Agency,l, 55F-1 55F-2 EXHIBIT A COMPUTATION OF APPROPRIATION LIMIT FOR FISCAL YEAR ENDING JUNE 30, 2013 Appropriation Limit: 1978-79 Base Year Permitted Growth Rate in appropriation (Exhibit B) Appropriation Limit for the Fiscal Year Ending June 30, 2013 $ 33,640,451 24.8852 $ 837,149,351 55F-3 55F-4 EXHIBIT B CALCULATION OF PERMITTED GROWTH RATE IN APPROPRIATIONS FOR FISCAL YEAR ENDING JUNE 30, 2013 Factor 2011-12: California CPI: 3.77% Converted into a Factor 1.0377 Population Growth: 0.89% Converted into a Factor: 1.0089 Rates of Change: 1.0377x 1.0089 1.0469 Multiplied by 2011-12 Combined Index 23.7704 Combined Index 1979-80 through 2012-2013 24.8852 55F-5 55F-6 EXHIBIT C SCHEDULE TO CATEGORIZE ANTICIPATED REVENUES FOR FISCAL YEAR ENDING JUNE 30, 2013 RF\/FNIIF TAXES: Property Tax Sales Tax Hotel Visitors' Tax Business Tax Documentary Stamp Tax Utility Users'Tax Total Taxes FROM STATE: State Motor Vehicle State Gas Tax Prop 1 B State Cost Reimbs State Grants AQMD AB 2766 Total State OTHER GOVERNMENT: Community Development (CDBG) Homeowner Prop Tax Subvention UASI Grant Housing (Section 8) WIA Measure M, Street Grants, Gas Tax Exch ARRA 2010 Civic Center and Park Program Income Other Federal Grants: HOME, HOPWA Total Other Government PROCEEDS OF TAXES $ 53,960,555 $ 39,241,683 7,335,044 10,251,000 520,000 24,742,266 136,050,548 0 0 230,050 230,050 55F-7 NON-PROCEEDS OF TAXES 9,255,465 0 421,800 6,600,000 414,000 16,691,265 6,392,910 10,735,240 30,308,095 3,915,035 8,121,350 164,250 2,622,080 1,820,000 2,776,835 66,855,795 TOTALS $ 53,960,555 39,241,683 7,335,044 10, 251, 000 520,000 24, 742, 266 136,050,548 0 9,255,465 0 421,800 6,600,000 414,000 16,691,265 6,392,910 230,050 10,735,240 30,308,095 3,915,035 8,121,350 164,250 2,622, 080 1,820,000 2,776,835 67,085,845 55F-8 Exhibit C Continued PROCEEDS NON-PROCEEDS REVENUE OF TAXES OF TAXES TOTALS LOCALLY RAISED: Licenses and Permits 4,262,440 4,262,440 Franchise Fees 8,125,905 8,125,905 Development Fees 0 Fines and Forfeitures 7,503,437 7,503,437 Charges for Services 14,373,102 14,373,102 Parks and Recreations 16,500 16,500 From Use of Property 15,073,810 15,073,810 Others 118,899 118,899 Others - Inter-Agency 8,667,180 8,667,180 Total Locally Raised 58,141,273 58,141,273 OTHER MISCELLANEOUS: Donation 160,270 160,270 Sale of Junk and Property 67,247 67,247 Attorney Reimbursements 978,930 978,930 Expense Reimbursements 3,316,111 3,316,111 Indirect Cost Recovery 2,094,556 2,094,556 From Prior Year Fund Balances 1,327,225 1,327,225 Refuse Program Saving 1,351,500 1,351,500 Interfund Transfers 3,101,760 3,101,760 Total Other Miscellaneous 0 12,397,599 12,397,599 FROM USE OF MONEY: Earnings on Investment 140,833 184,267 325,100 TOTAL REVENUES $ 136,421,431 $ 154,270,199 $ 290,691,630 55F-9 55F-10 EXHIBIT D APPROPRIATION SUBJECT TO LIMITATION FOR FISCAL YEAR ENDING JUNE 30, 2013 Proceeds from taxes $ 136,421,431 Less: Exclusions: Capital outlay 10,789,248 Appropriation subject to limitation $ 125,632,183 Current year limit Over(under) limit 837,149,351 $ (711,517,168) 55F-11 55F-12 Iss:6/7/12 RESOLUTION NO. 2012-XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA ESTABLISHING THE APPROPRIATION LIMIT OF THE CITY OF SANTA ANA FOR FISCAL YEAR 2012- 2013 BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. Article XIIIB of the Constitution of the State of California, adopted by the voters of the State of California in November 1978, imposes upon State and local government the obligation to limit each fiscal year's appropriations to those established in fiscal year 1978-79 as adjusted for by inflation and population, together with other specified changes required or permitted. B. In June of 1990, the voters of the State of California approved Proposition 111 which amended Article XIII B to establish the limit originally calculated for fiscal year 1986-87 as a new adjustment base and to change the definition of the cost of living to be either the percentage change in California per capita personal income from the preceding year or the percentage change in the local assessment roll from the preceding year for the jurisdiction due to the addition of local non-residential new construction. C. Proposition 111 further modified Article XIII B requirements by making certain capital outlay, debt service, emergency and court ordered expenditures not subject to the limit and by allowing expenditures in excess of one year's limit to be offset by under expenditures in an immediately following year. D. The City of Santa Ana has opted to use as the inflation adjustment factor, the percentage change in the California per capita personal income from the preceding year. E. The City of Santa Ana has opted to use as the population adjustment factor, the County's percentage change in population from the preceding year. Resolution No. 2012-XXX Page 1 of 3 55F-13 F. Division 9 of Title I of the Government Code of the State of California (commencing with section 7900), as enacted by 1980 Statutes, Chapter 1205, effective January 1, 1981, directs the governing body of each local jurisdiction each year to, by resolution, establish its appropriations limit and make other necessary determinations for the following fiscal year pursuant to Article XIIIB of the California Constitution at a regularly scheduled meeting or noticed special meeting. Fifteen days prior to the meeting documentation used in the determination of the appropriations limit and other necessary determinations shall be available to the public. G. This matter came on before the City Council at its regularly scheduled meeting of June 18, 2012. H. The Executive Director, Finance and Management Services of the City of Santa Ana has determined the City's appropriation limit for fiscal year 2012-2013 in accordance with the said provisions of the Constitution and laws of the State of California and the documentation used in said determination has been available to the public since not later than June 4, 2012 in the office of the Executive Director, Finance & Management Services. Section 2. Based upon the above referenced facts and all facts specified in the accompanying Request for Council Action and its attachments, and each of them, the appropriation limit of the City of Santa Ana for fiscal year 2012-2013 is hereby found and determined to be $837,149,351. Section 3. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. ADOPTED this day of 2012. Miguel A. Pulido Mayor APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By: Laura Sheedy Assistant City Attorney Resolution No. 2012-XXX Page 2of3 55F-14 AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, MARIA D. HUIZAR, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2012-XXX to be the original resolution adopted by the City Council of the City of Santa Ana on Date: Clerk of the Council City of Santa Ana Resolution No. 2012-XXX Page 3 of 3 55F-15 55F-16