january 25, 2017 study session charting our path presentation
TRANSCRIPT
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City Council Study SessionJanuary 25, 2017
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Purpose of Discussion
• Fiscal sustainability• Measures taken to date• Stakeholder ideas• Proposed process for analysis
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Background
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Fiscal Overview
• Past 10 years – economic fluctuations• 10‐year forecast – growing gap• Operational shortfalls continue without action
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Fiscal Overview
• Past 10 years – economic fluctuations• 10‐year forecast – growing gap• Operational shortfalls continue without action
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*$14.7M does not reflect the CalPERS recently reduced discount rate.
*$14.7M
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Gap Causes
• Weak revenues– Recession – Changes in shopper’s behavior
• Increased expenses– Pension– OPEB– Healthcare
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14FY 2007/2008
• $5 Million in reductions• 28 full time positions eliminated
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
FY 2008/2009• $10.5 Million in reductions• 112 full / part time positions eliminated • 56 vehicles eliminated
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
FY 2010/2011• $5.3 Million in reductions• 57 full / part time positions eliminated • 14 vehicles eliminated
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
FY 2011/2012• $5 Million in reductions• PARS Early Retirement Incentive Plan• 72 full time positions eliminated• Refunded City Hall Bonds
($1.7M one‐time savings)
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
FY 2012/2013• $700,000 in reductions• Eliminated and extended life cycle of
fleet vehicles
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
FY 2013/2014• $900,000 in reductions• Consolidated departments to reduce
costs and streamline operations• Maintenance Services• Recreation Services ‐ Library
• 14 full / part time positions eliminated
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14FY 2007/2008
• $5 Million in reductions• 28 full time positions eliminated
FY 2008/2009• $10.5 Million in reductions• 112 full / part time positions eliminated • 56 vehicles eliminated
FY 2010/2011• $5.3 Million in reductions• 57 full / part time positions eliminated • 14 vehicles eliminated
FY 2011/2012• $5 Million in reductions• PARS Early Retirement Incentive Plan• 72 full time positions eliminated• Refunded City Hall Bonds
($1.7M one‐time savings)
FY 2012/2013• $700,000 in reductions• Eliminated and extended life cycle of
fleet vehicles
FY 2013/2014• $900,000 in reductions• Consolidated departments to reduce
costs and streamline operations• Maintenance Services• Recreation Services ‐ Library
• 14 full / part time positions eliminated
FY 2015/2016• Non‐General Fund account savings• Department reorganizations to reduce
operating costs• Administrative Services• DWP• Risk and Legal
• 6 full time positions eliminated• Refunded Corporation Yard Bonds
($3.8M one‐time savings)
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
FY 2016/2017• Implemented zero‐based budgeting• Cash flow savings from prepayment of
PERS annual required contribution• Formed two citywide Community
Facility Districts• CFD 2016‐1 – Public Services ‐ $2.2M potential
annual revenue after build‐out• CFD 2016‐3 – Maintenance Services ‐ annual
assessment will help to offset maintenance costs required for future development
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Past ActionsFY 07/08
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FY 08/09
FY 10/11
FY 11/12
FY 12/13
FY 15/16
FY 16/17
FY 13/14
10 Year Totals• $27.4 Million in reductions• $5.5 Million in one‐time savings• 247 positions eliminated (27.7%)
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Other Actions Taken
• Survey and benchmarking with comparable communities
• Early Retirement Incentive Program (PARS) ‐ 2011• Exploration of defined contribution plan and other options
• Prepaying CalPERS – 2015 and 2016• Commissioning independent analysis on pension, OPEB and healthcare obligations ‐ 2016
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What’s Our Path Forward?
• Solicit and research ideas focused on:– Revenue generation– Cost savings
• Present findings and advice/recommendation• Form a consensus and seek Council direction• Incorporate into upcoming budget process
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Budget Timeline
Jan. – Feb.Jan. – Feb. Budget preparation
Personnel budgeting and
revenue forecasting
Feb. – Mar.Feb. – Mar.City Manager
budget meetings
Award of one‐time budget requests
Mar. ‐MayMar. ‐May Budget consolidation
Budget book development
City Manager review
MayMayCity Council Budget
Workshop
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Project Team
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Abigail SchellbergLibrary & Recreation Services Assistant
Director
Cita LongsworthPurchasing Manager
Cynthia MejiaEconomic
Development Intern
Lisa MobleyCity Clerk
Luis NavarroFinancial Analyst I
Reta WestonAccounting Supervisor
Tracy MartinDWP Utilities Project
Manager
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Proposed AnalysisProcess
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Guiding Principles
Strong Community
Clarity
Transparency
Fiscal Responsibility
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Focused Solutions
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Overall Process
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Idea Received and Logged
Conduct Research and
Analysis
City Manager Advice to City
Council
Obtain City Council Policy Direction
Information posted to website & reported at Council Study Sessions
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Idea Processing
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Idea Idea 3
Idea 1
Idea Idea 2
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Proposed Analysis Rubric
• Potential cost savings• Revenue generation
BudgetImpact
• Is it legal? Any jurisdictional issues?• Potential litigation?Legality
• Will public services be reduced?• Will services be unaffected/enhanced?
Impact toServices
• Helps achieve a Strategic Plan goal?• In line with City’s Mission Statement?
Community Priorities
• Is there a capital investment required?• How long until benefit is realized?
Return onInvestment
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Proposed Rating Legend
Symbol Meaning
Projected or potential positive impacts or benefits for the City
Low impact or requires more research
Projected or potential negative impacts to the City
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Each category in the analysis rubric will be assigned a symbol based upon the research:
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After the idea is researched and rated, the City Manager will review and make a recommendation for City Council direction:
Recommendation Legend
Symbol Meaning
Recommendation to proceed with idea
Idea requires more research before a determination can be made
Idea is not recommended based upon projected or potential impacts
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Sample Advice and Status
Idea Budget Impact Legality Service
ImpactComm. Priorities ROI
CityManager Review
Council Policy
Decision
Idea 1 Pending CC Decision
Idea 2 Rejected
Idea 3 Pending CC Decision
Idea 4 CM Review
Idea 5 Under Research
19Hyperlink to analysis
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Sample Analysis
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Idea Submission and Website
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Idea Submission
• Website: www.DiscoverCorona.com/OurPath• Phone: (951) 736‐2201
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Questions?
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