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2004-01-28 Budget PacketCITY OF ALAMEDA•CALIFORNIA SPECIAL MEETING OF THE CITY COUNCIL WEDNESDAY - - - JANUARY 28, 2004 - - - 7:00 P.M. Time: Wednesday, January 28, 2004, 7:00 p.m. Place: Council Chambers, City Hall, corner of Santa Clara Avenue and Oak Street. Pledge of Allegiance Agenda: 1. Roll Call 2. Public Comment on Agenda Item Only Anyone wishing to address the Council /Board on the agenda item only may speak for a maximum of 3 minutes per item. 3. Midyear Review - Fiscal Year 2003 -04 Budget. Adjournment Beverly Jo y or • For use in preparing the Official Record, speakers reading a written statement are invited to submit a copy to the City Clerk at the meeting or e -mail to: lweisige @ci.alameda.ca.us • Sign language interpreters will be available on request. Please contact the City Clerk at 747 -4800 or TDD number 522 -7538 at least 72 hours prior to the Meeting to request an interpreter. • Equipment for the hearing impaired is available for public use. For assistance, please contact the City Clerk at 747 -4800 or TDD number 522 -7538 either prior to, or at, the Council Meeting. • Accessible seating for persons with disabilities, including those using wheelchairs, is available. • Minutes of the meeting available in enlarged print. • Audio Tapes of the meeting are available upon request. • Please contact the City Clerk at 747 -4800 or TDD number 522 -7538 at least 48 hours prior to the meeting to request agenda materials in an alternative format, or any other reasonable accommodation that may be necessary to participate in and enjoy the benefits of the meeting. Interoffice Memorandum City f o I�rr�eala,� TO: FROM: SUBJECT: DATE: CC: Mayor and City Council James M. Flint, City Ma Mid -Year Review FY 2003 -0 January 23, 2004 Senior Management Team Attached is information in preparation for our Mid -Year Review for the FY 2003- 04 budget workshop that is scheduled for January 28, 2004. Attachment Dedicated to Excellence • Committed to Service MID -YEAR REVIEW FY 2003 -04 BUDGET CITY OFALAMEDA January 2004 FISCAL STRESS Given the continuing challenges presented by the unstable economy and the State budget deficit, the General Fund for the City of Alameda is under substantial fiscal stress. Accordingly, we have already taken actions to curb spending and growth in budget costs: Selective hiring "freeze" implemented in FY 01 -02 and which continues through FY 03 -04. Department budget reduction plans, implemented 1.5% in FY 02 -03 % and 2% in FY 03 -04). Shedding costs, e.g. code enforcement officer. Raising fees, e.g. permit tracking fee. Deferring projects, e.g. one -stop permit center Outsourcing, etc., building maintenance. Cost Recovery, e.g. adult softball fee. Requiring that new positions are fund by the conversion of existing department funds or the acquisition of new, stable funding sources, e.g. deputy city attorney. Additionally, we have doubled the size of our General Fund reserve from $9 million to $17.6 million to provide for additional financial flexibility over the past seven years. These financial management practices have been applied to those departments which are largely or entirely supported by General Fund revenues. Of our thirteen departments, only Alameda Power & Telecom, the Golf Complex, Development Services and the Housing Authority do not receive General Fund financial support. That means those departments with the most fiscal vulnerability are: Finance, Information Technology and Human Resources which provide internal or "staff' support; and, Police, Fire, Library, Planning and Building, Recreation and Parks and Public Works which are often referred to as "line" departments. Additionally, there are three "offices ", while not organizationally characterized as "departments," in combination, they provide support and direction to all work activity of the City, namely the City Clerk, City Attorney and City Manager. 1 In reality, while the General Fund ($62 million) is only one of seven operating budgets (total $281 million) for the City, it provides the fiscal foundation for the entire City government. And, with approximately 62% of the General Fund allocated for public safety services — Police and Fire — this operating budget becomes even more "fragile" in terms of its ability to secure adequate financial resources in order to meet the expectations of our community for local government services. It is still difficult to know what the outcome of the current State budget deficit machinations will produce in terms of actual fiscal impact on the General Fund for FY 2003 -04, since the Governor is trying to politically market his idea of using a combination bonds and further shifting /reducing local government revenue. However, the following is a summary of anticipated State budget impacts for FY 2003 -04: Loss of: Reimbursements for State Funded Mandates $ 260,000* Prop 42 — Traffic Congestion Relief Funds 110,000 POST Reimbursements 85,000 VLF Backfill & Realignment 1,351,919 *` Redevelopment ERAF 383,000 Public Libraries Grant 100,000 $2,300,864 Projected State Impacts for 2004 -05 Further, we have been informed that while the Governor has agreed to support the restoration of the VLF "2/3's backfill", he has proposed further shifting property taxes, known as the Education Resource Augmentation Fund (ERAF), from the local agencies to schools that would have an estimated reduction in the City's share of the property tax of between $1.025 to $1.560 million for the succeeding fiscal year (2004 -05). In addition, another estimated $400k annually in property taxes known as tax increments that currently go to the City's Redevelopment Agency is proposed to be contributed to ERAF. Certainly, this is not good news and with this proposal he does not appear to exhibit any knowledge of how cities are funded. He may have a commitment to providing General Fund Impacts 2 public safety services and job creation, but it is not evident in a proposed action to restore VLF fees then, simultaneously take away property taxes. Our employer PERS contributions continue their upward trend for 2004 -05 given the continued underperformance of PERS investments. Add to this the double digit increases for health costs, our PERS contributions will increase for public safety from 24.7% in 2003 -04 to 38.91% in 2004 -05 and 41.2% for 2005- 06. Miscellaneous contributions will go from 2.893% currently to 9.132% in 2004 -05 to 11.5% in 2005 -06. These increases in employer costs translate to an increase of $5 million in 2004 -05 and almost $2 million in 2005 -06 just in retirement costs. Finally, like any business, the City government continues to experience inflationary costs, albeit they have somewhat moderated which is reflected in the current estimated Consumer Price Index (CPI) for the Bay Area of 2.2 %. However, for the General Fund that still produces an increase of $1.24 million in annual inflationary costs. Service Demand Continues to Increase While, we continue to experience deterioration in our General Fund revenues and increased costs to conduct business which, in combination, produces substantial fiscal stress, we have simultaneously been experiencing increased demand for public services. Information Technology: has experienced an almost insatiable demand for more technology and data /information by both City staff and citizens. For example, four years ago we did not have a website. Currently, we are experiencing 550,000 "hits" per month. During the past four years, since we committed to building our capacity to provide more electronic access to City information /data, we have not been able keep up with the demand. And, the more we use technology to conduct the City's business the greater the need to keep our technology contemporary, the more maintenance it requires (through City staff and outsourcing), the more staff training it requires and, the more reliant we have become on technology to meet citizen and staff demand. Currently, we do not have the staff level necessary to support our present needs, nor can this support be outsourced to meet this demand, because it would still require an increased level of financial support for our information technology Human Resources: Although there is a decrease in demand for City recruitments, the demand for Human Resources services has shifted and grown significantly in other areas such as employee development, employee /labor relations, and classification review. Benefit costs containment has now become a major focus of human resource services. With the impact of the selective hiring freeze, departments are seeking assistance from human resources for ways to creatively structure positions in order to provide them with the flexibility needed to 3 provide services at an increasing level of demand with fewer or the same amount of resources. Finance: the freezing of certain positions in the department has increased the workload for existing finance staff. The duties performed by the Finance and Budget Manager have been absorbed primarily by the department director and other senior finance staff members. Recreation and Parks: The demand for parks and sports field maintenance continues to escalate especially with the construction of new residential developments and the changing family demographics in Alameda. Over the past five (5) years, the park and open space acreage has increased by 28 acres with no budget adjustments to the Park Maintenance Division. The demand for recreation programs is also growing with greater program emphasis being placed on creating year around programs for young children and teens. Library: Library activities, materials and services have increased greatly in the last five years, with no increase in staff. Circulation climbed by one -third from 1998 -2003. New services include self - service Express Checkout, and collections of circulating CD's, DVD's and Software. Collections have been heavily weeded of old and worn materials, and new materials purchases have increased. All public computers have been replaced with a faster, more reliable network and equipment, with the result that Internet usage at the Main Library has more than doubled with no additional terminals. New storytimes have been added for parents of very young children (1 -3), as well as storytimes in Spanish and Mandarin. Police: The Police Department's sworn staffing was reduced from 111 to 104 on July 1, 2002. The Police Department received 58,709 calls for service in 2000. In 2003, the Department received 72,854 calls for service. This represents an increase of 24 %. The Department has literally been doing more with Tess. UCR Part I crimes increased 5.1 % from 2002 to 2003, however arrests increased 16.4% during that same period. FBI criminologists expect the echo - boomer generation, now hitting the ages associated with criminality, to cause increases in crime rates over the next 10 to 12 years. Additionally, changes in the community such as development at Alameda Point have mandated changes to patrol staffing over the past year. Current and future community development will necessitate additional staffing to provide basic policing services. Increasing demands for police services, the continuing threats to homeland security from foreign terrorist groups, and forecasts of both community development and a trend toward increases in crime nationally are indicators of the challenges for the Police Department to maintain the quality of life and safety the citizens of Alameda expect. Fire: The demand for fire services has risen for a number of reasons. Although the number of fire calls has not risen dramatically from 2002 to 2003, the severity 4 of the fires has. The dollar loss due to all types of fires increased from $6,092,000 in 2002 to $8,417,500 in 2003. Large fires require more resources, equipment and investigation. Large fires also mean a greater chance for firefighter injury causing significant overtime costs due to the temporary vacancies. The demands for emergency medical service continue to increase with annual increases in the number of responses. This year the Fire Department will respond on average to over three hundred calls per month. Additionally, medical practices, procedures, and pharmaceuticals continue require a greater technical knowledge and skill level. These changes all add to the Fire Department's costs for training and equipment. Demands on the fire department have also increased since the September 11th tragedy. The federal government as with all Americans has turned to the fire service for protection from possible domestic terrorism. The fire department has had to prepare by purchasing specialized equipment and by increasing training in the areas of hazardous materials and weapons of mass destruction. Public Works: The demand for public works services is increasing as our infrastructure investment continues to age and deteriorate, outpacing our ability to fund necessary improvements. We have insufficient monies to fund an adequate preventative maintenance program for sidewalk repairs, street resurfacing, street tree pruning, city building maintenance and more. Because of the funding shortfall, we are not able to proactively maintain our infrastructure investment, but instead spend our resources addressing a backlog of issues associated with raised sidewalks, potholes, dead tree removal, street tree pruning, etc. This is very labor intensive. More specifically, the City has 131 centerline street miles. According to our pavement management program, we would need to spend $21 million today to bring our streets to "good" rating. Assuming our streets were in "good" condition, we would then require an additional annual preventative maintenance expenditure of $1.2M for street resurfacing. We historically fund only $350,000 a year. Similarly our sidewalk repair ($1.5M required to repair existing deficiencies and under funded annually by $400,000), city building upgrades ($1 M estimated to repair existing deficiencies and under funded annually by $350,000), and street tree pruning programs (to name a few) are all under funded. Planning and Building - Given that demand is driven by a surprisingly strong local development economy and the fact that Planning and Building is virtually self- supporting, the nexus between demand and staffing can be summarized by a couple of examples. First, the elimination of the Plans Examiner position will result in the need to outsource plan checkers at a cost of 65% of the plan check fee for those projects outsourced. Further reduction of approximately 50% of our concurrent plan check fee will result due to remaining staff's inability to meet concurrent plan check deadlines. Failure to meet those deadlines triggers the 5 need to refund the concurrent plan check fee. As a result, it is projected that eliminating the Plans Examiner position could result in revenue reduction of approximately $260,000 annually. A second example, would be Code Enforcement which is currently processing 500+ Code Enforcement cases. The new monthly caseload is increasing at a rate of 20 -30 new cases per month. Reduction in one Code Enforcement officer would require that only High Priority (life /safety) cases be processed. Medium and Low priority cases including vacant buildings, work without permits, Graffiti and junkyards, would not be pursued. Recommendations At this point in time, I would recommend, first, that we continue the financial management strategies that we have been pursuing to contend with this fiscal stress and make any additional financial adjustments at the end of the current fiscal year. Those funds would come from the General Fund Reserve. The second recommendation is that we spend additional time this spring as we review the next two -year (FY 2004 -05 and FY 2005 -06) Financial Plan to decide how to make adjustments to accommodate anticipated losses in our General Fund revenues. By then, we will have more information and be able to make more informed decisions. However, I would caution that if we do not experience a dramatic improvement in the economy and the State budget impacts are as substantial as we anticipate then, we will have to add to our current mix of financial management strategies, a combination of "drawing down" more heavily on our General Fund reserve and a reduction -in -force of staffing which means a corresponding reduction of municipal services. 6 City of Alameda • California December 8, 2003 JAN 2 1 2004 CITY �r Y OF . / LAMEDA CIT 6 Mb`1,N;:ci.;;;d :.''5::.: ASSESSING IMPACT OF BUDGET CUTS FROM CITY ATTORNEY'S OFFICE This memorandum assesses the impact on legal services which would result from various percentage reductions in the City Attorney's operating budget funded by the City's General Fund. As a preliminary observation, 88% of the City Attorney's operating budget is spent in the salaries of attorneys, law clerks and clerical support, with the remaining 12% spent on materials and supplies (paper, pens, etc.) and legal publications and legal research materials, including state codes and WestLaw computer research. Accordingly, any budgetary cuts will result in a corresponding reduction in the quantity and timeliness of legal services provided to the City staff and potentially, to City Boards and Commissions. This is of particular concern when the need for legal services has dramatically increased due to the development of Alameda Point and the increase in all required City services resulting from the retrocession of jurisdiction of Federal lands and other various City projects. With this context, the following breakdown of impacts from potential budget cuts of 2 %, 5% and 10% is discussed: 2% Budget Cut Amount: $17,667 This reduction has been made by Finance Department at the beginning of fiscal year 03 -04. Impact: This is equivalent to the loss of a law clerk. The City Attorney's Office uses law clerks to provide low cost, quick legal research to enable the attorneys to provide a greater quantity of legal services in the most cost effective manner. A 2% budget cut represents a loss of 998 hours of law clerk legal research time. The attorneys now spend the additional time researching matters that would normally be delegated to a law clerk. Dedicated to Excellence, Committed to Service Page 1 5% Budget Cut Amount: $43,624 Impact: This is equivalent to the loss of 50% of a Deputy City Attorney. The loss of a 50% of a Deputy City Attorney will have a direct negative impact on the quantity and timeliness of legal services performed for all City Departments, as the work load of a 50% Deputy position would have to be redistributed among the remaining attorneys, thus impacting the total quantity and timeliness of all legal services. (Essentially this represents an annual loss of approximately 1,000 hours in legal services.) Additionally, it may impact the ability of the City Attorney's Office to provide coverage at Board or Commission meetings. 10% Budget Cut Amount: $87,248 Impact: This is equivalent to a full -time Deputy City Attorney position and the loss of up to 2,000 hours of legal services annually. The loss of a full -time Deputy will have a direct impact on the ability of the City Attorney's Office to provide the quantity of legal work presently required by all Departments, and is further likely to negatively impact the timeliness of all legal work provided. This impact on legal services is also likely to have a corresponding impact on the litigation matters, potentially resulting in greater risk and liability to the City as well an inability to meet the Council's code enforcement priorities. Additionally, it is likely that the City Attorney's office will not be able to provide attorney coverage at Board or Commission meetings. - ♦- ♦ - ♦ - ♦- Dedicated to Excellence, Committed to Service Page 2 FACT SHEET Budget Cut Impact Projections 2002 -2004 Office of the City Clerk Percentage Amount Impact 1.5% $4,095 Eliminate document imaging services Reduce supply expenditures 2% $5,460 Reduce association memberships Reduce conference attendance 3% $8,185 Reduce Administrative Assistant hours to 16 hours per week 4% $10,915 Eliminate legislative history services 5% $13,645 Reduce Administrative Assistant hours to 13 hours per week 6% $16,375 Eliminate computer purchase 7% $19,100 Reduce Administrative Assistant hours to 10 hours per week 8% $21,830 Reduce Administrative Assistant hours to 7 hours per week 9% $24,560 Eliminate equipment maintenance contract 10% $27,290 Eliminate Administrative Assistant position entirely HUMAN RESOURCES DEPARTMENT Impact of Budget Cuts Percentage Amount Impact 1.5% $19,283 Reduction in general office supplies Reduction in consulting services 2% $25,711 Reduction in promotion/advertisement Reduction in professional services 3% $38,557 Reduction in recruitment activities Elimination of outside trainers 4% $51,422 Reduction of facilitation services for labor negotiations 5% $64,278 Elimination of facilitation services for labor negotiations 6% $77,133 Elimination of Employee Recognition Program Reduction in staff attendance at conferences /training Elimination of part-time Junior Office Clerk position 7% $89,989 Reduction in status of Intermediate Typist Clerk to three - quarter time 8% $102,844 Reduction in status of Intermediate Typist Clerk to one -half time 9% to 10% up to $128,555 Elimination of Intermediate Typist Clerk position 1/22/2004 [JAMES Flint - FACT SHEE1.doc Page 1 FACT SHEET FINANCE DEPARTMENT BUDGET REDUCTION PLAN 2003 -04 DECEMBER 1, 2003 UPDATE Percent Target Impacts of Reductions 2.0% $40,683 Minimum impacts Reduction of overtime and part time salaries by $6,000 may result in delay in business license renewals. Reduction of $13,000 in services budget delayed the update of the cost allocation plan. The 2% cut has deferred the installation of a security camera in the Finance reception/cashiering area ($5,000). The installation of a security camera has been recommended by the Alameda Police Department and supports the Employee Well - Being and Productivity strategic initiative. The consulting services budget was reduced by $5,085. 5.0% $92,084 Moderate Impacts The position of the Financial Services and Budget Manager has been held vacant in order to come up with the required 2% savings. This position cost approximately $126,000 /year inclusive of benefits. The position has been vacant since January 2003. Impacts: Workload has been distributed to remaining members of the Finance Department, i.e. Director, Supervising Accountant and Accountants. Customer service is impacted as there are less personnel available to answer telephones inquiries and/or request for service, provide timely support for special projects requiring detailed analysis, budget preparation and update now require more JAMES Flint - FACT SHEE1.doc Page 2 lead time. FACT SHEET FINANCE DEPARTMENT BUDGET REDUCTION PLAN 2003 -04 DECEMBER 1, 2003 UPDATE Page 2 Percent Target Impacts of Reductions Growing demand for support for the various financing efforts and related initiatives for the Alameda Point reuse and redevelopment efforts have also seriously impacted the workload of existing personnel. New initiatives for the department are also tabled until sufficient staffing is available, i.e. RFP for banking services, RFP for audit services. In addition, consulting services would need to be further reduced by $20,000, which would cut in half the program support for the financial systems. This would have direct impacts on our ability to produce timely and accurate financial records as well as further delay implementation of distributive payroll data entry as well as the planned conversion of the AP &T payroll to the city system now slated for mid - February, 2004. Postage budget would be reduced by $1,000 and meetings and conferences reduced by $2,000 seriously affecting our training opportunities for Finance personnel. Annual updates with respect to payroll regulations and governmental accounting standards training sessions may have to be limited to one staff member per session essentially hindering our opportunities for cross training of personnel. There are also significant costs for updating or maintaining computer skills necessary to JAMES Flint - FACT SHEE1.doc Page 3 run the various financial systems currently in place. FACT SHEET FINANCE DEPARTMENT BUDGET REDUCTION PLAN 2003 -04 December 1, 2003 Update Page 3 10.0% $184,169 Very Significant Impacts A 10% reduction would have very significant impacts on the Finance Department's ability to deliver its major service components. To meet the 10% budget reduction would involve the elimination of one Senior Account Clerk. Salaries and benefits: $46,000. Processing of parking citations, business licenses, vendor payments and processing departmental requests for reimbursements would be significantly impacted. Information Technology: The demand for more technology and immediate access to data/information is insatiable. Externally, the request for more information on our young website increases daily. Over the last four years we committed to building our capacity to provide more electronic access to City information which has created, yet a demand for more access. Below is an overview of the traffic we currently experience: ' k Summary by Month . F< 1011th Daily Avg • 1 Monthly Totals tea; I Visits -I Visits Dec2003 21782 15070 4025 16301 17591 15715 16126 4476197, 5069344 50539 52797 124794 127774 467181 479347 675256 689716 Nov 2003 22990 15978 4259 Oct2003 27793 18832 4670 1929! 18443 5699708 59803 144798 583796 861598 Sep 2003 J 7245 4973 1255, 494! 5725 1558476 14832 37652 1819921 149191 635419 217364 922011 Aug 2003 29742 20497 5870 20271 18213 6330735 62864 Ju12003 23398 16505 5046' 1961; I 172411 18659 167721 6137578 6243813 60807 51723 156434 L 125671) 511679 4186101 725359 598632 Jun 2003 19954 13953 4189 Internally to keep up with today's economy, technology has allowed our current staffs to be much more productive. Still, the more we use technology to conduct the City's business, the greater the need to keep our technology contemporary. This requires more maintenance via internal City staff, outsourcing and vendor maintenance contracts as well as training both on the user and technical levels. Currently, we do not have the staff level necessary to support our present needs. The current IT staff of 7 supports 500 computers and 700 users. In addition, there is the network management of 15 servers that keeps us all communicating, approximately 30 different applications software packages and the internal city -wide telephone system. Whether additional support is provided via outsourcing or adding to the internal staff, it still requires additional monies for information technology. LIBRARY Budget Reductions 03/04, Public Service Impacts 2% $31,000 No service impacts 3% $46,500 No service impacts 4% $62,000 close 4 hrs Main reduce materials purchases by $22,600 5% $77,500 6% $93,000 7% $108,500 8% $124,000 9% 139,500 10% $155,000 budget cuts January 04, 1/20/04 close 4 hrs Main close 3.5 hrs Branches reduce materials purchases by $29,875 close 6 hrs Main close 3.5 hrs Branches reduce materials purchases by $30,675 close 6 hrs Main close 7 hrs Branches reduce materials purchases by $34,750 close 8 hrs Main close 7 hrs Branches reduce materials purchases by $35,550 close 9 hrs Main close 7 hrs Branches reduce materials purchases by $43,700 close 10 hrs Main close 7 hrs Branches reduce materials purchases by $51,850 JAMES Flint - Recreation Budget Reductions Rev. 1- 21- 04.doc Page 1 CITY OF ALAMEDA ALAMEDA RECREATION & PARKS Budget Reductions for FY 2003/04 Department Divisions Recreation Services Hardball Swim Center Senior Services Park Maintenance Services Total Department Budget 2% Reduction Approved Total 10% Reduction Amount 1% $ 37,947 2% $ 75,894 3% $113,841 Approved Budget $ 1,593,620 126,240 228,352 400,977 1,520,013 $ 3,869,202 -$ 74,500 $ 3,794,702 $ 379,470 Impacts Salary savings - Recreation Supervisor Oct — Dec ($30,000) Reduce Training ($5,000) Reduce Office Supply ($2,947). Reduce Park Division water service expenses ($25,000) Reduce Recreation Supplies ($8,686). - For free playground & teen programs Reduce PT staff at Hardball Field from 5 days to 3 days ($4,261) Reduce Park Division Contractual Svs. ($19,684) - Defer tree trimming and fence repair Mastick Sewer Savings ($8,353) Reduce Mastick PT staff for Special Events /Senior Programs ($3,800) Eliminate Hoop Shoot/Egg Hunt ($2,150) Reduce Mastick Supplies ($2,697) Reduce supplies for Hardball Field ($1,263) JAMES Flint - Recreation Budget Reductions Rev. 1- 21- 04.doc Page 2 Alameda Recreation & Parks Budget Reductions for FY 2003/04 4% $151,788 Fund ($37,947) 5% $189,735 Fund ($14,315) ($10,000) 6% $227,682 ($23,685) 7% Programs ($6,700) $265,629 Page 2 Transfer 1 Senior Typist Clerk position to Athletic Trust Transfer 1 Senior Typist Clerk position to Athletic Trust Eliminate PT Park staff, evening restroom cleaning Eliminate Sunday park supervision ($2,800) Eliminate PT staff at Hardball Field ($10,832) - Limits game availability Eliminate Delivery Staff, FT Staff to assume duties Further Reduce Mastick PT Staff for Special Events /Senior Reduce Mastick Supplies ($1,300) Close Mastick Senior Center Sundays ($3,800) Reduce Recreation Supplies ($2,462) Eliminate Chipman Teen Program ($13,262) Eliminate remaining Mastick PT staff for Special Events /Senior Programs ($2,985) Reduce Mastick Monday PT Staff ($6,700) Eliminate PT park staff and Reduction in Level of Park Maintenance ($15,000) 8% $303,576 Eliminate Free Parks and Playgrounds Playground at Tillman, Lincoln and Littlejohn Parks($28,262) Reduce Park Division Contractual Services ($9685) 9% $341,523 Eliminate 2 weeks of Summer Swim Program ($21,000) Eliminate Free Parks and Playground Program at Washington and Woodstock Parks ($16,947) 10% $379,470 Eliminate Teen Center ($28,252) Eliminate Remaining Mastick Monday PT staff ($5,400) Eliminate remaining Recreation Supplies ($4,295) Planning & Building Mid -Year Budget Overview ✓ First half of FY 03 -04: Revenues Exceed Expenditures Development Review (4110) $244,173 49% $296,379 44% 82% Policy /Environmental Review (4120) $6,747 N/A $191,490 46% 3% Code Enforcement (4540) $104,031 68% $137,069 50% 75% Building Services (4520) $1,161,333 61% $792,667 47% 146% Historical Advisory Board (4130) N/A N/A $21,426 39% 0% Department Total $1,516,284 59% $1,439, 031 46% 105% ✓ Second half of FY 03 -04: Increased Revenues and Decreased Budgeted Expenditures Are Projected as Summarized Below (and detailed on the attached spread- sheet): Expected increase of revenue Expected decrease of expenditures PROJECTED SAVINGS TO GF 180, 000.00 39,629.07 $219,629.07 Note: As authorized by the City Manager and Finance Director, 85% of net excess revenues are being set aside in a special reserve budget line item for future funding of the one stop permit center. Additional Revenue Sources Being Explored (Potential for $100,000 to $200,000 Increase in Annual Revenues): ✓ General Plan/Zoning Administration Fee (to pay for unfunded updates to the General Plan, Zoning Ordinance and related planning and regulatory documents) ✓ Increased Cost Recovery through Improved Tracking/Billing of Labor and Materials Costs for Permit/Project Review ✓ Streamlining/Simplifying Department Fee Schedule Status: Ready for City Council Consideration. Additional Expenditure Reductions (Potential for $504,733 Reduction in Annual Costs): ✓ Implement Mid -Year Miscellaneous Spending Reductions for Savings of Approximately $39,000 for Remainder of FY ( =1% of Department Budget) ✓ Defer Filling 2 Vacant Positions (Planner and Administrative Services Coordinator), Eliminate Overtime and Eliminate Part Time /Temporary Positions for Savings of Approximately $ 271,076 /year (= up to 8% of Department Budget) ✓ Reduce Personnel Costs through Reduction in Force (Currently 3 Positions are Filled with Probationary Staff: Enforcement Officer, Plans Examiner, Planner I) for Savings of Approximately $194,657 /year (= up to additional 6% of Department Budget) Status: Mid -Year Reductions Ready for Implementation, Hiring Deferrals and Reductions in Force Can Proceed if Needed with City Manager Approval. However, very serious reductions in service and effectiveness will result as noted in the attached narrative. JAMES Flint - staff reduction.doc Page 1 Permit valuation has increased by 45% over last fiscal year indicating that larger projects are being developed this fiscal year. There are also several large City projects such as the Library, parking garage structure, Alameda Point, Catellus, Bridgeside, South Shore and the renovation of the Alameda Theater scheduled for the future. The Department is already challenged to dedicate sufficient staff to efficiently address current and anticipated future demands. The demands of these large projects will increase the workload of existing staff to very challenging levels. Reductions in key Department staff including Probationary and Part time staff would result in a decrease in Department revenue. Elimination of the Plans Examiner position will result in the need to outsource Plan checkers at a cost of 65% of the plan check fee for those projects outsourced. Further reduction of approximately 50% of our concurrent plan check fee will result due to remaining staff's inability to meet concurrent plan check deadlines. Failure to meet those deadlines triggers the need to refund the concurrent plan check fee. As a result, it is projected that eliminating the Plans Examiner position could result in revenue reduction of approximately $260,000 annually. Reduction of the part time Combined Inspector position will require some inspections to be postponed until the next day. As the above outlined projects come on line, this inspection delay will increase. Delays in inspections encourage contractors and homeowners to avoid the permit process. This reduction in Permit fees could result in further significant revenue reductions. Code Enforcement is currently processing 500+ Code Enforcement cases. The new monthly caseload is increasing at a rate of 20 -30 new cases per month. Reduction in one Code Enforcement officer would require that only High Priority (life /safety) cases be processed. Medium and Low priority cases including vacant buildings, work without permits, Graffiti and junkyards, would not be pursued. Not filling the Administrative Services Coordinator position has a negative revenue impact on the Permit Center. Duties previously performed by the ASC need to be picked up by Building Services Manager and Senior Account Clerk. These additional duties prevent the BSM & SAC from performing detailed review of permits. This inability to perform reviews, results in decreased revenue based on missed low valuations. This reduction in permit fees would result in a revenue loss of a $65,000 annually. Not filling the Planner III position has a significant impact on the implementation of the One Stop Center. Reduced customer service, and increased difficulty in obtaining planning approval will further reduce the incentive of contractors and homeowners to obtain permits. The reduction of the Plans Examiner, Part Time Combined Building Inspector, and Code Enforcement Officer will drastically reduce the Planning & Building Departments ability to implement the one stop permit center and could reduce revenue of approximately $525,000 /annually. JAMES Flint - Jan04 Budget Summary.doc Page 2 Force Can Proceed if Needed with City Manager Approval. However, very serious reductions in service and effectiveness will result as noted in the attached narrative. CITY OF ALAMEDA MEMORANDUM Date: December 4, 2003 To: James Flint City Manager From: Burnham E. Matthews Chief of Police Re: Five Percent Budget Reduction Background: A..,... ,,..i.74„,„:_!..., K./ DEC •• 4 2003 CITY OF ALAMEDA CITY MANAGER'S OFFICE You have requested a report on a five percent operations budget reduction. For the purpose of this report, it is assumed that the reduction is spread over a 12 -month fiscal year. Known, budgeted amounts for the 2003 -2004 fiscal year were used in the preparation of this report. The Police Department's approved operations budget for fiscal year 2003 -2004 is $18,581,037. Five percent of that amounts to $929,000. For illustrative purposes only, that is the equivalent of nearly nine full -time police officers. The Police Department has lost seven police officer positions since 2002. Discussion/Analysis: The Police Department has committed to the following as part of the two percent budget reduction ($371,621) made at the beginning of the fiscal year: • A savings of $100,000 from closely managing the overtime budget • A savings of $226,000 by deferring the hiring of 2 police officers for the 2003- 2004 fiscal year • A savings of $45,000 through additional salary savings These reductions have resulted in the Department operating at less than optimal strength in the Operations Bureau, where front line services are delivered. It is important to note that the deferral of hiring of two police officers for one year results in those positions being vacant for essentially two years. The lead time required to recruit, hire, and fully train an entry level police officer is at least one year — a unique scenario in city government - so these positions will not be available to the Department in a meaningful way for a total of two years. Dedicated to Excellence, Committed to Service James Flint City Manager December 4, 2003 Page Two To meet the budget reduction goal of $ 929,000, the following additional measures would be necessary: • A savings of $ 329,648 by deferring the filling of an additional three police officer positions including one existing vacancy and two anticipated due to pending retirements The impact of these vacancies will mean difficult choices including elimination of the School Resource Officer Program; elimination of the COPPS Unit and a host of Community- oriented services including DARE, Neighborhood Watch, Child Awareness, Security Surveys, Citizen Academy, and the Volunteer Program; reductions in the Patrol and Investigations Divisions resulting in increased response times to emergencies and other calls for service, reduced ability to initiate problem - solving in the community; and greater workload on investigators. Again, I must emphasize that due to the unique hiring and training requirements for an entry level police officer, it is likely that these positions will not be available to the Department in a meaningful, productive way for two years. • A savings of $ 39,744 through Reduction in Force (RIF) of one telephone operator. The telephone system can be automated; however the level of personal customer service the City's clients have received in the past will be eliminated. Frustration with a phone tree will doubtless affect the City's standing with the community it serves. Additionally, an increased workload will impact the Police Department's Communications Center as calls placed on the non - emergency line can not be screened and directed to the appropriate location as is now done during business hours. • A savings of $79,436 through RIF of four part-time Police Assistants in the Patrol Division. These personnel assist the sworn peace officers with routine investigation of lower -level police incidents not requiring the skills of a peace officer. These include staffing the Police Department's front desk, handling most inquiries and transactions there, taking telephone reports, and performing field duties that relieve the patrol officers so they can concentrate on emergency calls for service, complex criminal investigations, and community- oriented, crime reduction activities. Dedicated to Excellence, Committed to Service James Flint City Manager December 4, 2003 Page Three The elimination of both a telephone operator and these personnel would mean that the Department would have to rely on volunteers to staff the front desk when they are available and willing to participate. There would be a disruption to the Department during most business hours weekdays and both weekend days. Gaps in coverage would likely be filled by police officers taken away from other patrol duties. The response times on calls for service and individual officer workloads would see a noticeable increase due to reduced patrol staffing. • A savings of $41,864 through RIF of two part-time Police Assistants in the COPPS Unit These personnel provide personal safety instruction through the Child Awareness Program to all First Grade students in the community. They provide logistical and material support to all programs in the COPPS Unit including DARE, Neighborhood Watch, Citizen Academy, Alumni Association, Volunteer Program, Safety Town, and a host of other programs. The loss of these personnel would have a tremendous impact on all programs in the unit. Volunteers would have no assigned supervision. DARE graduations would be extremely difficult to continue at the same level of quality and impact on the community. The Alumni Association would lack a dedicated liaison with the Police Department. All of the community events at which the Department receives additional staffing through volunteers would be impacted. The officers in the unit would be required to significantly cut back their involvement in community activities in order to take on the additional work of the Police Assistants. In many cases, programs would have to be eliminated or reduced simply due to lack of staffing. Ultimately, the inability to provide these high quality programs that that community has come to expect will have a deleterious effect on the relationship between the Department and the community it serves. • A savings of $27,160 through RIF of two part-time Maintenance Assistants at the Animal Shelter The loss of these personnel will require remaining Animal Control Officers to perform routine maintenance and cleaning /care of animals at the shelter. Delays in responding to all but emergency calls for service will occur. Additionally, enforcement of animal - related laws will be diminished. Complaints from the community about delayed responses to calls for service will doubtless occur. Dedicated to Excellence, Committed to Service James Flint City Manager December 4, 2003 Page Four • A savings of $27,260 through elimination of all meetings and conferences The elimination of this funding will result in no opportunity for Police Department staff to attend important events including IACP, California Chiefs Conference, Robbery Investigators, Homicide Investigators, Sexual Assault Investigators, Narcotics Investigators, DARE Instructors, Crime Analysis, Records Supervisors, and Tiburon Computer User Group training conferences. Staff obtains invaluable training and information on contemporary policing, management, and executive issues at these and other meetings and conferences. • A savings of $12,960 through elimination of contractual cleaning service This will result in further, gradual degradation of high use areas of the Police Department and ultimately increased costs to repair or replace facilities equipment. The Police Department has absorbed the loss of six full -time civilians since 1998 and nine police officers since 2002. The loss of an additional 3 police officers and seven full - time equivalent personnel in order to make an additional three percent budget reduction will significantly impair the Department's ability to carry out its public safety mission in the community. I cannot emphasize enough the significance of the impact of these measures. Recommendation: This report is for informational purposes. I cannot recommend its implementation. RAM cc: Zenda James, Finance Director Dedicated to Excellence, Committed to Service 5 % BUDGET REDUCTION OVER 12 MONTHS FY 2003 -2004 Adjusted Budget as Approved by Council 5% Reduction POSITION /DESCRIPTION SAVINGS I Overtime Management (12 mo) 100,000 Defer Hiring 2 Police Officers (12 mo) 226,000 Defer Filling 1 Police Officer Vacancy(12 mo) - 104,486 Defer Filling 1 Police Officer Vacancy (12 mo) - 104,486 Defer Filling 1 Police Officer Vacancy (12 mo) - 120,676 Anticipated Salary Savings (Dept.Sec /Tfc. PA) 45,000 RIF 1 F/T Telephone Operator 39,744 RIF 4 P/T PA - Patrol 79,436 RIF 2 P/T PA - COPPS 41,864 RIF 2 P/T Maint. Assistant Shelter 27,160 Eliminate Meetings and Conferences 27,260 Eliminate Contractual Services (Cleaning) 12,960 18,581,037 929,000 TOTAL SAVINGS / VARIANCE FROM GOAL 929,072 72 PUBLIC WORKS Net Allocation General Fund Gross General 0 rn o c C o u g� N NO 8 3 0) 0. 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ALL a y x m o L v O cO o m 0 c a) a) 0 O N .° O c r C9 o ca o o cu E Z. a .N o o is a 'C U C cu a) co U u) c w " ,F y R U O L rn C 2 co N m N d .w A Q 0 c 0 - 2 U m .O a o V' v E U O r' a E •3 •3 c. c.) m o _- U U o c L o o m a) > c c s a •o 3 m" .v o a`) s Ct o o C o CI) U) ++ O U Na)caJ m o N> C)3. t; =8 m 'o c a• o f "' c c o U m 'a .2 I y 3 � o• a O m N N C 3 0 co o o j"0 c o E o Q= U isi O 2 co O C VU ■ y U o i- c m N a y z C • L. C O c 0 as 7 a) 0 Q.. ro O L c 3 L_ w= ca a= c a N o• cu m° m c m .a) a) 0 0 h o •C y o o' E o rn o_ p> co m •- c � .a O % U a C y CO L co J a F- U -O (`o • a) c 5) a) m e 07 > > 0 'O 0 C y y co ct N° Cco — O 0 ) U,- O m m m E 6- ac )'� m O)°- j ; O > U , ++ 'L_ y a N `E O O m Q -O .1= C C gu ' CD maO c LL C a o O N • Freeze one Associate Civil En >. CO 0 2 c cu E N CD c0 O L LL O. a0 -cam .+ O - O m U > O. a) -a U U co N . O c v m U o o c U O a CC co c 7 E m a) C ro c .1;3) o° N O' LNrnc°S�rn �E�L•c > E U O a) U m O LL yo co O .0) c`u • o c o. c w co O. > U E o .Q O 'v) a) c m c E w m L. o "md O C U. 2 N 0 a_ 11. O rn 1 a+ c o F- u Q F a 2y g:pubworks \pwadmin \mclean \General - gfsavings1to10 - Jan 21 2004.xls CITY OF ALAMEDA MEMORANDUM Date: December 5, 2003 �� ALAMEDA James Flint CITY '��.aF''�i OFF' CE City Manager p1TY r r ?moo DEC - 8 2003 From: James L. Christiansen Fire Chief Re: Mid -Year Budget Reduction Proposal For FY 2003/2004 The following is the Fire Department's proposal for a mid -year budget reduction of $1,602,000. The $1,602,000 is equivalent to a 6% annual reduction, or a 12% half -year reduction. In order to meet the financial objective proposed, the reduction measures will need to take effect on January 1, 2004, and remain in place through June 30, 2004. Fire Department budget reduction proposal: Eliminate one Division Chief (Fire Marshal) $156,000. Eliminate one staff Captain (Deputy Fire Marshal) $132,000. Eliminate one Fire Prevention Inspector $106,000. Eliminate one staff Captain (Training Officer) $132,000. Eliminate the Emergency Medical Services $100,000. Educational Coordinator position Eliminate two administrative support positions $90,000. Closure of Ladder Truck Company 2 $492,000. (Pacific and Webster Streets Fire Station) Closure of Fire Station 5 for five months $394,000. (Alameda Point Fire Station) $1,602,000. Dedicated to Excellence, Committed to Service The above proposal makes dramatic cuts in the department infrastructure as well as the delivery of emergency services. The infrastructure reductions include the elimination of the Fire Prevention and Training Divisions. Additionally, two administrative staff support positions will be eliminated. Emergency service reductions include the elimination of one ladder truck company for the entire six -month period and the elimination an engine company for five months. Twenty -seven employee layoffs will be necessary with this proposal. Since there are currently six vacancies within the department, actual employee layoffs in the firefighting ranks will be 21. The reductions by work classification include one Division Chief, eight Fire Captains, six Apparatus Operators, and seven Firefighters. Daily on -duty firefighting staffing would be reduced from 27 to 2lfirefighters. We would continue to keep our three ambulances in service. The proposed reduction will considerably impact public safety fire protection. Due to fewer personnel and increased response times, we anticipate the dollar loss from fires will increase considerably, as well as experiencing an increase in firefighter injuries. Additionally, we would have to rely heavily on mutual aid from Oakland and surrounding fire departments to avoid fires of major proportions. The impact to the department's infrastructure would be dramatic. We would no longer inspect any buildings for fire safety; no longer complete Urban Runoff inspections; no longer complete building plan- checks, no longer investigate fires for cause and origin; and be severely hampered in our apartment inspections by firefighters. We would also be in violation of the County Emergency Medical Services Contract with the elimination of the Emergency Medical Services Educational Coordinator's position. With the elimination of the Training Section we would be unable to hold firefighter academies for new firefighters without substantial overtime costs. There would also be no centralized or coordinated training department -wide. Elimination of two administrative support personnel would leave the total for the department to two positions. There would be days, due to illnesses, etc. when the phones and doors could not be answered. Additionally, there could be potential delays in payroll submissions and other critical reporting requirements. Furthermore, we would be severely challenged in the management and accounting of our revenue, which exceeds a million dollars per year. es L. Christiansen ire Chief Dedicated to Excellence, Committed to Service