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FY 2022 PROPOSED ANNUAL OPERATING &
CAPITAL BUDGET
Presented by:City Manager Peter Zanoni
July 27, 2021
FY 2022PROPOSED
BUDGETSUMMARY
(October 1st, 2021 thru September 30th, 2022)
2
Budget Transparency
• 5 Budget Community Input Sessions Scheduled
• 1 Public Hearing on the Tax Rate, 1 Public Hearing on the Stormwater Fee & 1 Public Hearing on the Budget
Budget Community Input SessionsMeetings beginning at 6pm
1) Community Input Council District 1 –Monday, August 9, Hopkins Library
2) Community Input Council District 2 – Wednesday, August 11, Lindale Senior Center
3) Community Input Council District 3 – Thursday, August 12, Choke Canyon Room – Water Utilities
4) Community Input Council District 4 – Monday, August 16, Ethyl Eyerly Senior Center
5) Community Input Council District 5 – Wednesday, August 18, Veterans Memorial High School – Teaching Theater
3
Budget Development
Budget Development Process
Office of Management and Budget in coordination with city departments establish base operating budget requirements and capital needs for the new fiscal year
Once the base operating and capital budgets are established, the City Manager meets with all department directors and their teams to review, refine and finalize the operating budgets and capital projects based on department’s professional recommendations and City Council priorities
Based on City Manager’s review and final recommendation, the Office of Management and Budget prepares the Proposed Operating and Capital Budget for City Council review and consideration
4
FY 2022 Total City Budget $1.2 BillionGeneral Fund $258.3 Million
Enterprise Funds $238.3 Million
Special Revenue Funds $133.1 Million
Debt Funds $118.2 Million
Capital Budget $420.1 Million
$1.2 Billion
5
FY 2022 Proposed BudgetGeneral Fund (with transfers)
FY 2021 Adopted Budget$265.4 Million
FY 2022 Proposed Budget$298.4 Million
11.1%Increase
6
FY 2022 General Fund Budget: $298.4 Million
24.4%Other
Departments$57.8M
Police & Fire
$144.8 M
Services, Fines & Fees, $82.9 M 28%
Fund Balance$13.2 M
4%
Other Resources
$47.6 M16%
Sales Tax$63.0 M
21%
Property Tax$91.7 M
31%Mayor & City Council
City Secretary
City Auditor
City Manager's Office
Intergovernmental Relations
Communication/Call Center
Legal
Finance
Office of Management & Budget
Strategic Planning & Innovation
Human Resources
Municipal Court
Neighborhood Services
Health
Library
Comprehensive Planning
Outside Agencies
Transfers
Reserve
7
Revenue Sources
Growth over FY 2021Adopted Budget% Amount
Property Tax 6.0% $5.2M
Sales Tax 9.4% $5.4M
All Other Revenues 8.7% $10.5M
General Fund Revenue Growth
over FY 2021 Adopted Budget
8
FY 2021 FY 2022
Property Values Growth 2.09% 6.97%
Tax Rate 0.646264 0.646264
Property Taxable Value
Growth & Rate
9
• No change to FY 2022 Property Tax Rate
• Final 2 cent voter approved Residential Street Property Tax increase (M&O) - Not Recommended at this time
• Truth in Taxation calculation being finalized by Appraisal District and Tax Assessor/Collector – tax rate and revenues subject to change
Street Maintenance$42,857,995
Street Maintenance Fee (SMF)
$11,701,744
General Fund Revenue –
6%$14,926,344
Inter-Dept. Transfer
$4,205,553
Other: Interest,
Street Cut Fees, etc.
$ 7,887,982
Industrial District
$1,344,627
Regional Transportation
Authority (RTA)
$2,791,745
Arterials & Collectors
Reconstruction $60,188,554
General Obligation
Bonds $57,338,554
Type B Funds
$1,200,000Grants
$1,650,000
Residential Streets
Reconstruction$18,454,211
Industrial District
$1,344,627
Other: Interest, etc.
$845,625
2+2 cents Incremental Property Tax$8,495,705
One-Time General Fund
Transfer$6,116,254
General Fund Revenue -2/3 of 1%
$1,652,000
$121,500,760FY 2021-2022 Proposed Budget
Street Maintenance & ReconstructionFunding from 10 different sources
10
Street Maintenance$32,545,000
11
Arterials & Collectors
Reconstruction $65,130,474
Fiscal Year 2020
Arterials & Collectors
$70,700,000
Fiscal Year 2021Street
Maintenance$33,034,40
Fiscal Year 2022
Total: $128,365,000 Total: $ 121,500,760Total: $78,023,875
Arterials & Collectors
$70,700,000
Residential Streets
$25,120,000
Street Maintenance$33,034,480
Arterials & Collectors
$34,200,000
Residential Streets
$10,789,395
Street Maintenance $ 42,857,995
Arterials & Collectors
$60,188,554
Residential Streets
$18,454,211
56% increase in Streets for FY 2022
Nearly $328M in three years
Streets FY 2022Additional funding from the General Fund for
Residential Streets ($6.1M)
Street rehabilitation paving crew composed of 12 positions and new equipment ($2M)
Safe Route to School Program will rehabilitate citywide sidewalk infrastructure near education
centers ($750K)
Vision Zero enhancements and Internally Illuminated LED Street Name Signs ($880K)
Infrastructure improvements along Northwest Blvd (FM 624)-median, ditches, etc. ($150K)
Funding for a comprehensive pavement evaluation survey of the City’s streets and roadways ($1M)
Purchase of 11 vehicles to modernize and expand Street fleet ($2.4M)
12
Police FY 2022Funding for ten new Police Officer positions ($1M)
New Police Academy scheduled for July 2022 ($1.1M)
Replace 250 in-car mobile data computers for Police, Fire, Animal Control and Airport Police ($2M over two years)
Upgrade to Public Safety Computer Aided Dispatch (CAD) and Record Management System (RMS) for Police, Fire, EMS, Code Enforcement,
Animal Control, Airport Police ($840K)
Storage and servers for the public safety body camera and in-car video systems ($215K)
Phase 3 Radio payment for 854 radios at 0% interest final year ($1.2M)
Outright purchase of five additional Police marked vehicles ($250K)
Crime Scene mapping drone package ($25K)
Design and Construction of a new Police Academy Complex at Del Mar South campus ($21.3M over three years)
13
Fire FY 2022Funding for eight new fire fighter positions to create
additional Medic Unit placed at Station 17 (Yorktown) ($500K)
New Fire Academy scheduled for January 2022 ($1.5M)
Truck Replacements of: Three Medic Units and one Fire Pumper Truck– Lease Purchase
Outright purchase of an additional Medic Unit, Potable Water Tanker Truck and Hazmat Material Response Unit
($2.3M)
$400K increase in the City’s financial contribution to the Firefighter retirement system
Design and Construction of a replacement Fire Station # 3 located on Morgan Ave ($9M over three years) 14
Parks & Rec FY 2022Funding for park amenities at Labonte, Lindale, Billish, Parker, Salinas, Bill Witt
and Lakeview Parks ($1.5M)
New Dog Parks at Sherwood and West Guth Parks ($900K)
New splash pad in Cole Park ($500K)
Funding for Cole Park Pier Maintenance ($150K)
Veterans Memorial Park monuments design in Sherrill Park ($100K)
Addition of a Landscape Architect in lieu of outside contracts ($100K)
Addition of eight swim instructors to expand the summer swim instruction program ($26K)
Purchase of 16 vehicles to modernize the Park & Beach operations fleet utilizing SHOT funds ($1.6M)
Funding for additional 230 shade trees throughout City Parks ($225K)
Demolition of old Cunningham WTP last used in the 1980’s and a Master Plan for Labonte Park that incorporates the land into a new City gateway park
($5.3M)15
Type B Fund
Will be working with Type B Board of Directors to request funding in August workshop for economic development initiatives and ecotourism park improvements
Type B is forecasted to have $10M in fund balance in FY 2022
Proposed initiatives and improvements are as follows:
Gateway signage on IH37Monument signage at Labonte ParkKayak launch pad at Labonte ParkNight-time Lighting at new Executive 9-hole golf
course at Lozano Golf CourseAmenities at Ocean Drive chain of parks (Cole,
Ropes, Oleander, Doddridge, Swantner, Palmetto and Poenisch) 16
Marina FY 2022Marina Breakwater assessment ($560K)
Funding for the reconstruction of Peoples Boardwalk ($3.1M)
Funding from the General Fund and Insurance Proceeds for Marina Dreading ($5M) as part of the
pier replacement project
Replacement of fencing and gates at the dry storage area, replacement of large roll up door on the Haul
Out Facility ($130K)
Replacement and additions of signs throughout the Marina ($82K)
Two dockhand positions to support the 24/7 Marina operations ($123K)
Marina Master Plan ($100K)17
Bayfront FY 2022Upgrades to Seawall and Miradors lighting
($1M)
Seawall event programing ($100K)
Facility Improvements to the Art Center and Art Museum ($3.5M)
Phase 1 design for Art Center Revitalization being developed by the Board of Governors
($50K)
Repairs and restoration of the Water Garden water feature ($4.5M)
Downtown investment total $2.3M in FY 2022 Budget with Tax Increment
Reinvestment Zone # 318
Neighborhood Services FY 2022Two additional live release coordinators ($90K)
Four full time Animal Care Kennel Techs and addition of two new vehicles ($92K)
Additional Veterinarian position to increase treatment and live release rate ($100K)
Space/Programming design study at Animal Care campus to modernize for live release and overall better customer service ($50K)
Five additional neighborhood Code Enforcement Officers, three funded by General Fund and two by CDBG grant brings strength to 28 officers
($430K)
Additional funding for demolitions of dangerous structures for the proposed sudden acts policy ($250K)
Tablet replacement for Code Enforcement Officers ($93K)
Funding for fee waiver for non-qualifying infill housing properties ($100K)
Legal fees for City Council Redistricting ($50K) 19
Library FY 2022
20
Assessment and initial improvements to exterior
at La Retama Central Library ($250K)
Increase to building maintenance to all six
libraries ($120K)
Communication FY 2022
21
Citywide website and portal upgrade to enhance the experience of the viewing
public ($500K)
Four additional call center representatives for the new 311 call center to address
increased call volume ($170K)
Additional Social Media Public Information Officer to assist all
departments with Social Media posts and graphics as well as a City Photographer
position to be available for all City events ($136K)
Auditor FY 2022
22
Addition of one Senior Auditor Position and one
Audit intern ($127K)
Solid Waste FY 2022No Residential Rate increase for FY 2022
Addition of two positions for Litter Crew to collect litter along major corridors ($145K)
Addition of four positions and garbage trucks to create two new garbage and one recycle route to better
serve our growing community ($99K two months of funding)
Addition of four positions and equipment to create an additional Brush and Bulky Crew ($155K four months of funding)
Purchase and install of eight Onboard Truck/Trailer Mounted Scale Systems in order to control gross
vehicle weight ($128K)23
Hotel Occupancy Tax (HOT)
HOT Revenues BudgetFY 2021 FY 2022 Variance$15.5M $16.4M $0.9M
24
FY 2022 HOT budget includes the following initiatives:
Citywide Wayfinding Signage ($500K)
Fully funded support for the Science & History Museum ($550K)
North Beach Plaza Historical Signs ($100K)
Convention and Visitors Bureau funding for FY 2022 is $5.6M
Arena & Convention
Center
Key focus area for FY 2022
New leadership at ASM Global
Operating and Capital costs (including debt) supported by Sales Tax and HOT funds total $18.9M
Revenues from events total $4.5M25
Development Services FY 2022
Development Services building 1st & 2nd floor remodeling ($4.75M)
Addition of two Building Inspector positions to perform trade inspections
($218K)
Addition of three Compliance Inspectors to perform non-scheduled
building code technical compliant inspections ($327K)
26
Development Services
Fees
Based on the current construction cost index, Development Services fees are approximately 40% behind where they should be. Fees have not been adjusted in over a decade. Proposed fee adjustments are as follows:
Adjustment to 46 existing feesAddition of 36 new feesElimination of 12 feesIncrease all other fees by 20%
27
Airport FY 2022Capital Improvements to the CCIA
Terminal Building to Replace Passenger Boarding Bridges, construct new Service
Animal Relief Area, Renovation of all bathrooms and an addition of a Nursing Room ($11.7M over the next three years)
Expansion of Public Cell Phone Lot to ease traffic congestion along terminal curb
($700K)
Four Parking Operations positions to support in-house paid parking lot operations
($207K) 28
Water FY 2022Addition of two positions to take over the backflow prevention
program from Development Services ($150K)
Addition of two positions to improve customer service and strategic planning ($560K)
Additional two positions for the Mary Rhodes Pipeline for maintenance, repairs and line locating ($95K)
Funding for water storage tanks exterior maintenance and to meet regulatory requirements ($1M)
Capital Improvements investment of $145M over the next three years with $25M in FY 2022 to rehabilitate and upgrade
O.N. Stevens Water Treatment Plant
Capital Improvements investment of $112.5M over the next three years with $39M in FY 2022 to replace and repair water
lines citywide 29
Wastewater FY 2022Addition of eight position for Wastewater
Treatment Plant preventative maintenance activities ($760K)
Purchase of eight vehicles & machinery to modernize the Wastewater fleet ($620K)
Capital Improvements investment of $118.1M over the next three years to repair, rehabilitate and upgrade all six Wastewater Treatment Plants with $34.8M in FY 2022
30
StormwaterObjectives of a New Stormwater Fee• Stable revenue stream to properly maintain and increase services
to the system to include capital improvement projects• Remove stormwater from the water rate to create financial
transparency • Create a fair fee structure for stormwater management that is tied
to drainage runoff
Basis of Fee Structure• Residential:
• Tier 1 = < 3,000 Square Feet of Impervious Area• Tier 2 = 3,000 - 4,500 Square Feet of Impervious Area• Tier 3 = > 4,500 Square Feet of Impervious Area
• Non-Residential: No tiers; fee based on lot size, intensity of use and amount of impervious area
31
Stormwater 5-Year Program
32
FY 2022 FY 2023 FY 2024 FY 2025 FY 2026
Base Program $ 15,748,563 $ 17,765,684 $ 22,276,842 $ 26,387,575 $ 29,393,203
Improvements $ 2,007,882 $ 4,511,158 $ 4,110,733 $ 3,005,628 $ 2,611,250
Total $ 17,765,684 $ 22,276,842 $ 26,387,575 $ 29,393,203 $ 32,004,453
Monthly FeeResidential Rate
Tier 1 $4.59 $5.61 $6.61 $7.33 $7.94
Residential RateTier 2 $6.12 $7.48 $8.81 $9.77 $10.58
Residential RateTier 3 $10.71 $13.09 $15.42 $17.10 $18.52
Non-ResidentialRate
$6.12/per each ERU*
$7.48/per each ERU
$8.81/per each ERU
$9.77/per each ERU
$10.58/per each ERU
*Equivalent Residential Unit (ERU)
Stormwater ImprovementsFY 2022• Street Sweeping- Increase Arterials from 4 to 8 times a year• Additional Channel and Ditch Maintenance Crew – Increases to 2 Crews• Stormwater Utility Fee Team – Resolution and Utility Assistance Program• ID/IQ Construction Contract- William Ditch and Glenoak Dr.• Stormwater System Televising and Inspections ProgramFY 2023-2026• Street Sweeping- Transitioning Total Program to In-House and increasing
residential from 2 to 4 times a year• Additional Inlet Cleaning and Inspection Crew – Increased Cleaning Cycles
from 3 to 2 years• Additional Channel and Ditch Maintenance Crew – Increases to 3 Crews• Vegetation Maintenance – Herbicide and Mowing Improvements• ID/IQ Construction Contract – Bridge, Channel and Infrastructure
Rehabilitation• Creek Monitoring and High Water Detection System• Continued Bay Water Quality Improvements
33
Gas FY 2022Seven positions to support the meter replacement program
($650K)
Eight positions to support infrastructure replacement
program ($760K)
Purchase of 17 vehicles & machinery to modernize the
Gas fleet ($970K) 34
Utility
Rates
Wastewater – Proposed monthly rate increase to go into effect in January 2022 of $1.97 for a typical residential customer with a 5000-gallon winter quarter average
Water – Proposed monthly rate decrease by $6.12 to go into effect in January 2022 offsetting Stormwater Fee for typical residential customer using 6000-gallons of Water a month
Stormwater – New monthly Stormwater fee proposed to go into effect in January 2022, typical residential customer is $6.12
Gas – No proposed rate change 35
Net Impact - $0 (Zero Dollars)Gallon of Water
per MonthNumber of Customers
Percentage of Customers
Bill in 2021
Bill in 2022 Change
Average Residential Water Customer 6,000 47,214 54% $45.18 $39.06 - $6.12
Average Residential Stormwater Customer $0 $6.12 $6.12
Total $0
36
Senior, Disabled & Low Income
Utility Assistance Program
For FY 2022 program to provide rate increase relief for customers that use 2000-gallons or less of water per month that will consider:
Low income
Seniors 65 and older who are low income
Disabled customers
37
Employee Health Benefits in FY2022
Fire’s medical insurance premiums projected to decrease by 8.6% on both Fire PPO and Fire CDHP plans (Savings of $600K)
Police’s city funded medical insurance premiums projected to decrease on average 25.6% (Savings of $1M)
Civilians’ medical insurance premiums projected to have a small increase of 3% forCiticare Value PPO Plan and no increase for Citicare CDHP plan
38
FY 2022 Capital Budget $448.9 Million
Funding Uses by Program Amount% of Total
Water $111.9M 24.9%
Streets (Less Utility Support) $84.2M 18.8%
Wastewater $80.1M 17.8%
Stormwater $58.1M 12.9%
Parks & Recreation $45.8M 10.2%
Public Health & Safety $39.5M 8.8%
Airport $11.2M 2.5%
Gas $10.3M 2.3%
Public Facilities $7.8M 1.8%Total FY 2022 Capital Uses $ 448.9M 100%
39
FY 2022 Budgeted Positions
0
500
1000
1500
2000
2500
3000
3500
4000
FY 2018 FY 2019 FY 2020 FY 2021 FY 2022
2,316 2,298 2,456 2,534 2,676
414 414414 414
422446 446451 456
466
Civilian Employees Firefighters Police Officers
• Addition of 12 positions in Streets for Street rehabilitation paving crew
• Addition of 10 Police Officers• Addition of 8 Fire Fighters• Addition of 4 Kennel Technicians, 2 Live Release
Coordinators and 1 Veterinarian• Addition of 5 Code Enforcement Officers• Addition of 1 Grant Writer in Finance• Addition of 8 positions in Wastewater for
Treatment Plants maintenance• Addition of 14 positions to create a Ditch &
Channel Maintenance Crew and 2 positions for the In-House street sweeping in Stormwater
• Addition of 15 positions in Gas to support the meter replacement and infrastructure replacement programs
3,176
3,404 3,5643,3213,158
40
NextSteps
City Council Budget Workshops
(August 5th, 12th, 19th, 26th)
Budget and Tax Rate Adoption(1st reading August 31st
2nd reading September 7th)
Budget CommunityInput Sessions
(August 9th, 11th, 12th, 16th, 18th)
Public Hearings(Tax Rate - August 31st)
(Stormwater Fee - August 31st)(Budget – August 31st)
41
FY 2022 PROPOSED ANNUAL OPERATING &
CAPITAL BUDGET
Presented by:City Manager Peter Zanoni
July 27, 2021
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