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Home My WebLink About16 - Resolution Adopting FY 2013-14 Appropriations LimitNEWPORT CITY OF NEWPORT REACH FoaN'P City Council Staff Report Agenda Item No. 16 June 11, 2013 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Finance Department Dan Matusiewicz, Finance Director/Treasurer 949 - 644 -3123, danm @newportbeachca.gov PREPARED BY: Susan Giangrande, Budget Manager APPROVED: TITLE: Adoption of Fiscal Year 2013 -14 Appropriations Limit ABSTRACT: As a governmental entity, the City is subject to the Gann Appropriations Limit Initiative. Under the Gann Limit, a maximum spending threshold is established for tax supported government services thereby limiting the amount of annual appropriation of tax proceeds. The limit is adjusted annually for changes in population combined with the change in California per capita personal income and must be adopted by Resolution. For Fiscal Year 2013 -14, applicable tax proceeds are estimated at $128.7 million. The City's Gann appropriation limit totals $159.4 million. Therefore the City is more than $30 million under the Gann Spending Limit. RECOMMENDATION: Adopt, by Resolution 2013- 52 , the City's Appropriations (Gann) Limit for Fiscal Year 2013 -14 in the amount of $159,433,819. FUNDING REQUIREMENTS: There is no fiscal impact related to this item. DISCUSSION: Article XIIIB of the California Constitution specifies that appropriations of government entities may increase annually only by a limited amount, primarily to allow for population increases and inflation. Each local government is required to establish its appropriations limit by resolution each year at a regularly scheduled or noticed special meeting of the City Council. The attached resolution submitted for Council approval fulfills this requirement. The calculation of the City's Appropriation Limit for Fiscal Year 2013 -14 is: Adoption of Fiscal Year 2013 -14 Appropriations Limit June 11, 2013 Page 2 FY 2012 -13 Appropriations Limit $ 150,988,947 Inflation Adjustment Factor' 1.0512 Population Adjustment Factor' 1.0045 FY 2013 -14 Appropriations Limit $ 159,433,819 ' Based on California per capita income increases as provided by the California Department of Finance, May 2013. 2 Based on Newport Beach population growth as provided by the California Department of Finance, May 2013. The City of Newport Beach estimated proceeds from taxes for Fiscal Year 2013 -14 is $128,682,737, or $30,751,082 under the Appropriations Limit. Calculation of proceeds of taxes can exclude certain public fund uses, including categories of debt service, contribution to some types of reserves, and federal mandates. The exclusion calculation was not performed as we continue to maintain appropriations significantly below our Appropriations Limit. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). The Public Notice for this item was published in the Daily Pilot on June 1, 2013. Submitted by: an Matusiewicz Finance Director/Treasur Attachments: Resolution 2013- 52 RESOLUTION NO. 2013- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH DETERMINING AND ESTABLISHING AN APPROPRIATIONS LIMIT FOR FISCAL YEAR 2013 -14 IN ACCORDANCE WITH ARTICLE XIIIB OF THE CALIFORNIA CONSTITUTION AND GOVERNMENT CODE SECTION 7910. WHEREAS, Article XIIIB was added to the California Constitution at the special State -wide election held November 6, 1979 (commonly known as Proposition 4); and WHEREAS, Government Code Section 7910 was added to Chapter 12.05 by Statute at the Regular Session of the California Legislature; and WHEREAS, Proposition 111, which, among other things, provides new annual adjustment formulas for the Appropriations Limit, was approved by the voters in June, 1990; and WHEREAS, the State of California Department of Finance have published population and per capita income growth indexes, as well as guidelines for the uniform application of Proposition 111; and WHEREAS, Government Code Section 7910 requires the governing body of each local jurisdiction to adopt, by resolution, its appropriations limit; and WHEREAS, said appropriations limit must be adhered to in preparing and adopting this City's annual budget. NOW, THEREFORE, the City Council of the City of Newport Beach does hereby resolve as follows: Section 1: In accordance with Article XIIIB of the California Constitution and Government Code Section 7910, the appropriations limit for fiscal year commencing July 1, 2013 for the City of Newport Beach is $159,433,819. The computation of appropriations for the 2013 -14 fiscal year are set forth in detail in the attachment hereto, which is incorporated as though fully set forth herein. Section 2: Said appropriations limit shall be adhered to in the City of Newport Beach budget for the 2013 -14 fiscal year. ATTEST: ADOPTED this 11th day of June, 2013. Leilani I. Brown, City Clerk Keith D. Curry, Mayor COMPUTATION OF APPROPRIATION LIMIT FOR FISCAL YEAR ENDING JUNE 30, 2014 AS PER ARTICLE XIIIS, CALIFORNIA STATE CONSTITUTION FISCAL YEAR 2012 -13 note (1): note (2): PRIOR YEAR LIMIT INFLATION POPULATION ADJUST. (1) ADJUST. (2) NEW APPROP. LIMIT $150,988,947 0.0512 0.0045 1 $159,433,899 Based on California per capita income increases Based on Orange Newport Beach population growth CALCULATION OF ESTIMATED PROCEEDS OF TAXES FOR FISCAL YEAR ENDING JUNE 30, 2014 Total Estimated Proceeds of Taxes $128,682,737 Less Authorized Exclusions Net Proceeds of Taxes note (3) $0 $128,682,737 note (3): Since 2013 -14 estimated proceeds are substantially less than the Appropriations Limit, exclusions were not calculated. AMOUNT UNDER APPROPRIATIONS LIMIT $30,751,082 a�ooF of P 1 : L OWNT91 O R! STATE OF CALIFORNIA) COUNTY OF ORANGE ) I am a citizen of the United States and a resident of the County of Los Angeles; I am over the age of eighteen years, and not a party to or interested in the notice published. I am a principal clerk of the NEWPORT BEACH /COSTA MESA DAILY PILOT, which was adjudged a newspaper of general circulation on September 29, 1961, case A6214, and June 11, 1963, case A24831, for the City of Costa Mesa, County of Orange, and the State of California. Attached to this Affidavit is a true and complete copy as was printed and published on the following date(s): Saturday, June 1, 2013 I certify (or declare) under penalty of perjury that the foregoing is true and correct. Executed on June 10, 2013 at Los Angeles, California !L :1v2. !i .i ate4 Signature M OOF P[71 O STATE OF r y I_ i F O F, i A i Ol1PJ T'i" OF ORANGE ) I am a citizen of the United States and a resident of the County of Los Angeles; I am over the age of eighteen years, and not a party to or interested in the notice published. I am a principal clerk of the NEWPORT BEACH /COSTA MESA DAILY PILOT, which was adjudged a newspaper of general circulation on September 29, 1961, case A6214, and June 11, 1963, case A24831, for the City of Costa Mesa, County of Orange, and the State of California. Attached to this Affidavit is a true and complete copy as was printed and published on the following date(s): Saturday, June 1, 2013 I certify (or declare) under penalty of perjury that the foregoing is true and correct. Executed on June 10, 2013 at Los Angeles, California &kvd � Signature PROOF OF PUBLICATION STATE OF CALIFORNIA) ) SS. COUNTY OF ORANGE ) I am a citizen of the United States and a resident of the County of Los Angeles; I am over the age of eighteen years, and not a party to or interested in the notice published. I am a principal clerk of the NEWPORT BEACH/COSTA MESA DAILY PILOT, which was adjudged a newspaper of general circulation on September 29, 1961, case A6214, and June 11, 1963, case A24831, for the City of Costa Mesa, County of Orange, and the State of California. Attached to this Affidavit is a true and complete copy as was printed and published on the following date(s): Saturday, June 1, 2013 I certify (or declare) under penalty of perjury that the foregoing is true and correct. Executed on June 10, 2013 at Los Angeles, California "Awuef� Signature U •11.13 JTEM -4 t�I June 1, 2013 CITY OF NEWPORT BEACH DAN MATUSIEWICZ (949) 644-3123 LEGAL NOTICE NOTICE IS HEREBY GIVEN THAT the City Council of the City of Newport Beach will hold a public hearing regarding Proposed Budget for the 2013-14 Fiscal Year, pursuant to Section 1102 of the Newport Beach City Charter. NOTICE IS HEREBY GIVEN THAT said public hearing will be held on the 11th day of June, 2013, at the hour of 7:00 p.m. in the City Hall Council Chambers, 100 Civic Center Drive, Newport Beach, CA 92660, at which time and place interested persons may appear and be heard thereon. TOTAL BUDGET ALL FUNDS - INCLUDING CAPITAL IMPROVEMENTS: Salaries and Benefits $128,011,144 Maintenance and Operations 73,128,905 Capital Outlay 4,496,512 Capital Improvements 61,286,576 Debt Service 11.994.739 Total Budget ,§278.917.876