HomeMy WebLinkAbout10 APPROPRIATION LIMIT FOR FY 2020/2021DocuSign Envelope ID: 3431 F6CE-8632-432D-8504-AED3F6D95485
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AGENDA REPORT
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MEETING DATE
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FROM-
SUBJECT-
SUMMARY:
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SUMMARY:
JUNE 16, 2020
MATTHEW S. WEST, CITY MANAGER
Agenda Item 10
Reviewed: 1W 5W
City Manager
Finance Director N/A
JASON AL -IMAM, DIRECTOR OF FINANCE/CITY TREASURER
APPROPRIATION LIMIT FOR FISCAL YEAR 2020/2021
Article XIII B of the State Constitution requires each City to annually adopt a limit on
appropriations for all governmental funds. The following recommendation and attached
worksheets are based on the FY2020-2021 Proposed Budget as presented to the City
Council on June 2, 2020 and subsequently amended.
RECOMMENDATION:
1. Select the change in the California per Capita Personal Income as the price factor
for adjusting the Fiscal Year 2020/2021 appropriations limit.
2. Adopt Resolution No. 20-30 setting the appropriation limit for Fiscal Year
2020/2021 at $97,694,703.
CORRELATION TO THE STRATEGIC PLAN:
The adoption of the fiscal year 2020/2021 Appropriation Limit implements strategy number
three (3) of Goal C.
FISCAL IMPACT:
None.
BACKGROUND:
Article XIII B of the State Constitution requires Cities to annually adopt a limit on
appropriations for governmental funds. The basis of this limitation is the relationship
between proceeds of tax and total appropriations. The base year was 1978/79, and the
limit is allowed to grow based on the annual increase in population and U. S. CPI /
California per Capita Personal Income, whichever is less.
DocuSign Envelope ID: 3431 F6CE-8632-432D-8504-AED3F6D95485
City Council Agenda Report
June 16, 2020
Appropriation Limit for FY 2020/21
Page 2
Proposition 111 was approved by voters in 1990 changing the base year from 1978/79 to
1986/87 and amending the adjustment formulas to make the Appropriation Limit more
responsive to local growth patterns. It also required a review of the Limit calculation as
part of the annual audit process.
Exhibit "A" shows the calculation of the Appropriation Limit for Fiscal Years 2020/2021.
The result shows the City of Tustin is below its allowable appropriations limit for Fiscal
Year 2020/2021 by $49,740,951. The data used in computing the City's appropriation
limit is available for public inspection.
Jason AI -Imam Sean Tran
Director of Finance/City Treasurer Deputy Finance Director — Admin. Svs.
Glenda Babbitt
Management Analyst I
Attachments: Exhibit A
Resolution No. 20-30
DocuSign Envelope ID: 3431 F6CE-8632-432D-8504-AED3F6D95485
EXHIBIT A
Appropriations Limit
City of Tustin
Fiscal Year 2020/21
AMOUNT
Last Year's Limit (2019/20) $94,144,067
Adjustment Factors
1. Population0) 1.0004
2. Inflation (2) 1.0373
Total Adjustment Factor (3) 1.0377
Total Adjustments 3,550,636
Appropriations Limit for Fiscal Year 2020121 $97,694,703
Appropriations Subject to Limit:
Proceeds of Taxes $47,953,752
Minus Exclusions -
Appropriations Subject to Limit $47,953,752
Fiscal Year 2020/21 Appropriations Limit 97,694,703
Less Appropriations Subject to the Limit 47,953,752
Difference Under the Limit 14a,740.951
')The population factor may be based on the change in population of 1) the City; or 2) the
County of Orange, as provided by the State of California's Department of Finance. The
population factor adopted by the City for the current year appropriation limit represents the
change in population of the County of Orange.
(2)The inflation factor may be based on 1) the change in per capita personal income for the
State of California as provided by the State of California's Department of Finance; or 2)
the change in assessed valuation due to new nonresidential construction within the City.
The inflation factor adopted by the City for the current year appropriation limit represents
the change in per capita personal income for the State of California.
(3)The total adjustment factor is calculated by multiplying the population factor by the inflation
factor.
DocuSign Envelope ID: 3431 F6CE-8632-432D-8504-AED3F6D95485
RESOLUTION NO. 20-30
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUSTIN, CALIFORNIA, DETERMINING AND ADOPTING AN
APPROPRIATION LIMIT FOR THE FISCAL YEAR 2020-
2021 IN ACCORDANCE WITH ARTICLE XIII B OF THE
CONSTITUTION OF THE STATE OF CALIFORNIA, AND
SECTION 7910 OF THE GOVERNMENT CODE
The City Council of the City of Tustin does hereby resolve as follows:
WHEREAS, Article XIII B was added to the Constitution of the State of California
at a general election held November 6, 1989; and
WHEREAS, an annual appropriation limit must be determined forthis City effective
for the fiscal year beginning July 1, 2020; and
WHEREAS, the appropriation limit must be adhered to in preparing and adopting
this City's Annual Budget;
NOW, THEREFORE, the City Council of the City of Tustin does hereby resolve
and order as follows:
Section 1: In accordance with Article XIII B of the Constitution of the State of
California, and Section 7910 of the Government Code, and as set forth in detail in the
Attached Exhibit "A", that the appropriation limit for the fiscal year beginning July 1, 2020
through June 30, 2021 is $97,694,703.
Section 2: The appropriation limit shall not be exceeded in the adopted budget
or by any proposed amendment to the budget.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Tustin held on the 16th day of June, 2020.
Resolution 20-30
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DocuSign Envelope ID: 3431 F6CE-8632-432D-8504-AED3F6D95485
DR. ALLAN BERNSTEIN,
Mayor
ERICA N. YASUDA,
City Clerk
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF TUSTIN )
I, Erica N. Yasuda, City Clerk and ex -officio Clerk of the City Council of the City of Tustin,
California, do hereby certify that the whole number of the members of the City Council of
the City of Tustin is five; that the above and foregoing Resolution No. 20-30 was duly
passed and adopted at a regular meeting of the Tustin City Council, held on the 16th day
of June, 2020, by the following vote:
COUNCILMEMBER AYES:
COUNCILMEMBER NOES:
COUNCILMEMBER ABSTAINED:
COUNCILMEMBER ABSENT:
ERICA N. YASUDA,
City Clerk
Resolution 20-30
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