HomeMy WebLinkAbout2011-04-26 City Council Item No. 05CITY OF
LAKT IPCJ LS1A0
DREAM EXTREME-
REPORT TO CITY COUNCIL
TO: HONORABLE MAYOR
AND MEMBERS OF THE CITY COUNCIL
FROM: ROBERT A. BRADY
CITY MANAGER
DATE: APRIL 26, 2011
SUBJECT: CITY COUNCIL BUDGET GUIDELINES FOR FISCAL YEAR 2011-12
Background
The City Council annually gives direction regarding the preparation of the next year's
budget. This report lists the Proposed Budget Guidelines for Fiscal Year 2011-12. As
proposed, these guidelines are the standard by which the operating budget will be
developed. These guidelines are structured to reflect City Council's goals and
objectives and provide the framework in which the operating budget for all the City's
entities in Fiscal Year 2011-12 will be prepared.
Also included in this report are the proposed budget preparation process and the budget
calendar for the Fiscal Year 2011-12 budget process. Some key dates to remember are
as follows:
Thursday, May 26th: Public budget study session with the City
Council for the Fiscal Year 2011-12 proposed operating
budgets for the City, Special Revenue Funds and
Redevelopment Agency and the City's Five-Year Capital
Improvement Program (CIP).
Tuesday, June 7th: Preliminary CIP review with the Planning
Commission for General Plan compliance.
Tuesday, June 28th: Presentation of the Fiscal Year 2011-12
proposed operating budgets and CIP to the City Council for
adoption.
Fiscal Impact
There is no fiscal impact directly associated with this item.
AGENDA ITEM NO. 5
Page 1 of 8
City Council Budget Guidelines for Fiscal Year 2011-12
April 26, 2011
Page 2
Recommendation
It is recommended that the City Council:
Approve the Budget Guidelines for Fiscal Year 2011-12
Prepared by: James Ril
Director of A inistrative Services
Approved by: Robert A. Brady
City Manager
Attachment 1: City Council Budget Guidelines for Fiscal Year 2011-12
Attachment 2: Budget preparation Process for Fiscal Year 2011-12
Attachment 3: Budget Calendar for Fiscal Year 2011-12
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CITY OF ^
LADE 9LSIIYOP\E
DREAM
City Council
Budget Guidelines for Fiscal Year 2011-12
The City Council annually gives direction regarding the preparation of the next
year's budget. This report lists the Proposed Budget Guidelines for Fiscal Year
2011-12. As proposed, these guidelines are the standard by which the operating
budget will be developed. These guidelines are structured to reflect City Council's
goals and objectives and provide the framework in which the operating budget for
all the City's entities in Fiscal Year 2011-12 will be prepared.
Fiscal Year 2011-12 Budget Guidelines
Guideline: Budget proposals should be reflective of the City Council's
Goals and Objectives. The budget should exhibit priorities
established by the City Council in its Long-term Financial
Planning.
Guideline: The policies established with the adoption of the annual budget
will be communicated to the community through the City
Website and quarterly budget reports.
Guideline: Proposed General Fund departmental budgets for Fiscal Year
2011-12 will be set at a spending level that will be free from
reliance upon non-recurring revenue sources or deficit
spending. The City will not commit to spending more than a
conservatively prepared estimate of recurring revenues.
Departments must submit proposed budgets within these
spending limitations.
Guideline: Budgets will be prepared which adhere to a policy that
emphasizes:
• A fiscally balanced budget
• An operationally balanced budget
• Maintenance of an adequate reserve for emergencies
• Development of locally controlled, new long-term
recurring revenue streams
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Attachment 1
Page 3 of 8
City Council
Budget Guidelines for Fiscal Year 2011-12
(continued)
Guideline: The City will maintain a minimum of a 15% (of adopted
recurring appropriations) Undesignated General Fund Balance
through June 30, 2012 for future unexpected contingencies
(earthquake, floods, etc.). This will ensure a General Fund
reserve of approximately 3.6 million. Financial and service
stability will continue to be the primary objective in developing
the annual operating budget for Fiscal Year 2011-12. (Current
reserve is at 14.6%).
Guideline: While the budget detail will be prepared for Fiscal Year 2011-
12, departmental budgets will include an analysis of the longer-
range impacts (up to five years) of the Fiscal Year 2011-12
budget on continued service levels.
Guideline: The City's Five Year Capital Improvement Program (CIP) will
be prepared on the same schedule as the review and adoption
process of the City's Operating Budget. This will provide
coordination of the two activities and facilitate project tracking.
The portion of the Five Year CIP which relates to Fiscal Year
2011-12 will be included in the operating budget.
Guideline: The City's budget will contain a program commitment to
actively pursue improved intergovernmental relations that
include seeking financial assistance such as grants, relief from
unfunded mandates, and assumption of a leadership role in
regional and statewide organizations.
Guideline: Reflect a commitment to the citizens and the business
community by making it easy to access the Adopted Operating
Budget, Comprehensive annual Financial Report, and Capital
Improvement Budget documents along with corresponding
quarterly reports through the City of Lake Elsinore's website.
Guideline: Citizen participation is encouraged by providing an opportunity
for public review and comment of the proposed budget.
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Attachment 1
Page 4 of 8
City Council
Budget Guidelines for Fiscal Year 2011-12 (continued)
City Council's Top Priorities:
1. To achieve a balanced budget while minimizing the use of the Supplemental
Revenue Reserve.
2. Maintaining the City's 15% Fund Balance Reserve of adopted recurring
appropriations. This is critical to the ongoing stability of the City's finances.
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Attachment 1
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CITY OF LAKE ELSINORE
BUDGET PREPARATION PROCESS
FISCAL YEAR 2011-12
The Administrative Services Department, Finance Division, is responsible for the
preparation of the City's annual budget. The Finance Division prepares an annual
budget calendar and provides detail instructions, worksheets and assistance to each
department with respect to the preparation of their particular department budget.
The City uses a combined department/ division and line item budget format. This is
designed to provide for a comprehensive management control and fiscal planning
system. The purpose of using this format is to achieve goals and objectives at the
operational levels that are consistent with the City Council's Goals and Objectives.
The budgeting process is generally an incremental one which starts by building on the
current year's budget. Revenue estimates, job position and department operating
requests for changes in appropriations are made at the department/ division level and
are initially complied and reviewed by the Finance Division. An initial review of the
Preliminary Budget is reviewed by the City Manager and all Department Directors and
Division Managers. This is then presented to the Budget Committee for review.
Next in the process, the City Manager and the Director of Administrative Services
review each Department separately with the Director and Managers of the Department.
After all Departments have been reviewed and final adjustments are made, a final
Proposed Budget Document is prepared and reviewed and approved by the City
Manager. The Proposed Budget is then presented to the City Council and the public in
a study session.
Based on the recommendations and revisions made by the City Council at the study
session, the Final Proposed Budget is presented for adoption in June, with the Adopted
Budget Book prepared and disseminated in late August.
The City Council Budget Guidelines and the Budget Calendar for Fiscal Year 2011-12
are included with this summary.
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Attachment 2
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CITY OF LAKE ELSINORE
BUDGET CALENDAR
FISCAL YEAR 2011-12
APRIL 2011
• April 8, 2011: Budget Committee Meeting.
• April 8, 2011: Draft of FY 2011-2012 Budget Guidelines sent to
Budget Committee for review and input.
• April 11, 2011: Present FY 2011-2012 Budget Calendar to City
Manager and Department Directors.
• April 11, 2011: Estimated revenue spreadsheets available.
Preliminary revenue estimate guidelines given.
• April 18, 2011: Salaries and Benefits and department operating
budget forms distributed.
• April 18, 2011: FY 2011-12 CIP project requests and
performance measure forms to be distributed.
• April 18, 2011: Special Revenue Fund estimated revenue
available.
• April 25, 2011: FY 2011-12 Revenue estimates by departments
due to Finance.
• April 26, 2011: FY 2011-2012 Budget Guidelines presented at
City Council meeting for approval.
MAY 2011
• May 2, 2011: FY 2011-12 Salaries & Benefits and department
operating budget request by departments due to Finance.
• May 2, 2011: FY 2011-12 CIP project requests and performance
measures due to Finance.
• May 13, 2011: Department Directors and Managers Meeting and
Review of Preliminary Budget. 8:OOAM to 12:OOPM.
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Attachment 3
Page 7 of 8
• May 13, 2011: Budget Committee Meeting.
• May 13, 2011: FY 2011-12 Proposed CIP projects reviewed and
approved by Director of Public Works.
• May 16th to 19th, 2011: Department review of FY 2011-12
budget and CIP with City Manager, Department Directors,
Managers and Director of Administrative Services.
• May 24, 2011: 3rd Quarter FY 2010-11 Budget Review. Includes
Special Revenue Funds, RDA and CIP.
• May 26, 2011: Study session with the City Council for the City,
CIP, Special Revenue Funds and the RDA.
JUNE 2011
• June 7, 2011: Preliminary CIP review with Planning Commission
for General Plan compliance.
• June 28, 2011: Present FY 2011-12 Proposed Operating Budgets
and Capital Improvement Plan projects to City Council for
adoption.
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Attachment 3
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