2009-08-03 3-A B and C Power PointCity Manager
Communications
August 3, 2009
Financial State of the City –July 1, 2009
•
State Budget Impacts –24-Month Horizon
•
Budget Forecast –FY10-11and Beyond
•
Financial State of the City:
Two-Year Retrospective
Total City budget –all funds –decreased
•
from $228M to $199.5M in 24 months
(July 1, 2007 to July 1, 2009)
All funds net decrease -$28.8M
•
General Fund’s portion -$10.1M
•
Total all funds available “cash” balance
•
decreased from $195.4M to $156.5M
Available “cash” net decrease -$38.9M
•
General Fund’s portion -$9.9 gross (true
•
expenditures) -$5.0 net (reversed to other
funds)
Decrease of 13% in spending power
•
Decrease of 15% in real money
•
State Budget Impacts
Immediate
•
$55M of available resources (spending
power) lost in past 10 years
$2.4M “loan” from General Fund in FY09-10
repaid in FY12/13
$4.4M in total increment “take” from RDA
project areas in FY09-10 -never repaid
$916,765 in total increment “take” from
RDA project areas in FY10-11-never repaid
Pending
•
Gas tax remains at risk -$1.2M annually
pays for staff, streets, curbs, gutters
Ability to repay projected General Fund
“loan” in FY12-13 questionable
Immediate ‘takes’ and ‘borrowing’ solves
less than 50% of the State’s $23+ billion
deficit
Future value of deficit will increase with
higher unemployment, inflation, and flat
revenue growth in sales, property and
other taxes
City Budget Forecast
Present
•
FY09-10 Budget only one year approved
appropriations possible at this point
Based on financial foundation of past
reductions and cost containments
Limited to no growth budget in revenues
and expenditures
Future
•
Increase in unemployment rate
Flat, if not declining, projected tax growth
Credit market freeze
Future State “borrowing” affecting cash
Future State “takes” requiring “cuts” in
services, programs and projects
Alameda’s Economic Realities
•
Sales tax loss of $1.2M by June 2012
OPEB increase of $600,000 by July 2011
PERS increase of $3.5M (6%) to $5.5 (10%)
due to investment losses in FY11-12
Impacts to operating costs such as,
personnel, materials, supplies -unknown
Translates to
•:
Significant decline in available cash
balances in all funds
Limited capital improvement dollars
General Fund structural deficit
(revenue growth of .5%-2% minus
expenditure growth 8%) equal to $4.5M
recurrent annual shortfall in FY11-12 and
thereafter