Calabasas Municipal Code Ch. 3.48 Management and Budget Policy

A. The city will attempt to maintain a diversified and stable revenue base to minimize the effects of economic fluctuations on revenue generation.

B. The city will estimate revenue using an objective, analytical process; in the case of uncertainty, conservative projections will be utilized.

C. The city will fund all current expenditures from current revenues.

D. Development process costs and related administrative expenses will be offset by development fees.

E. The finance director will provide monthly reports to the city council which discuss revenue projections in light of actual collections to date. Revised revenue projections will be adjusted, if necessary, half way through the fiscal year.

F. Beginning with the 1994-95 budget, all operating costs should be analyzed based on the following two revenue restrictions:

1. The city will be losing a significant amount of state subvention revenue in fiscal year 1998-99 based on revised population figures. Section 11005(c) of the State Revenue and Taxation Code established a formula of three times the number of registered voters for purposes of calculating population used in determining state subvention levels for cities incorporated after January 1. 1987. In the case of Calabasas, the formula resulted in a population of twenty-eight thousand two hundred thirty-four (28,234) as compared to the 1993 General Plan estimate of population of nineteen thousand eight hundred fifty-seven (19,857). The law freezes the original population figure for a period of eight years. At the conclusion of the eight years, the population number used reverts to the State Department of Finance certified population. General fund revenues affected are the following state subvention revenues: motor vehicle in lieu tax, trailer coach in lieu tax and off highway license fees. Highway users' tax revenues in the gas tax funds will also be reduced.

2. Past levels of development activity are unlikely to continue in the future. This change will affect the amount of service fees collected by the city relative to development and new construction, and therefore, this revenue source should not be expected to continue at current levels.

(Ord. 95-94 § 2 (part), 1995)

A. A contingency reserve account will be appropriated annually to provide for unanticipated expenditures of a nonrecurring nature and/or to meet unexpected increase in costs.

B. A reserve for future capital improvement projects will be established, and will be carried forward from year to year to provide resources for the city council to found future infrastructure and other one-time expenditure needs of the city.

C. The city is a member of the Southern California Joint Powers Insurance Authority (SCJPIA), a consortium of approximately sixty-eight (68) California cities. The SCJPIA is a risk-sharing, self-funded pool providing insurance-like benefits to its members. A self insurance reserve will be maintained for the purpose of setting aside resources to finance higher deductibles and self insurance retention in the future. The amount of the reserve will be analyzed annually to determine to appropriate funding level.

D. General fund unappropriated fund balance reserves will not be allowed to fall below ten (10) percent of current year general fund operating budget. This policy will be reevaluated every two years.

(Ord. 95-94 § 2 (part), 1995)

A. The authority of the city council to invest or to reinvest funds of the city, or to sell or exchange securities so purchased, may be delegated for a one-year period to the city treasurer, who shall thereafter assume full responsibility for those transactions until the delegation of authority is revoked or expires and shall make a monthly report of those transactions to the legislative body. The delegation may be made by resolution of the city council adopted at a public meeting. The city treasurer shall work under the general direction of the city manager.

1. Subject to review, the city council may renew the delegation of authority pursuant to this section each year.

2. Investments and cash management shall be consistent with the current investment policy adopted on an annual basis by resolution of the city council. The city treasurer shall annually submit a statement of investment policy which the city council shall consider at a public meeting. Any change in the policy shall also be considered by the city council at a public meeting.

3. The city's independent auditors, in conjunction with their annual audit, will audit the cash and investment balances in conformance with generally accepted accounting principles.

B. Surplus funds of the city shall be invested in accordance with the provisions of the California Government Code Sections 53600 et. seq., and of the current investment policy.

(Ord. 97-116 § 1, 1997: Ord. 95-94 § 2 (part), 1995)

A. When the city finances capital projects by issuing bonds or certificates of participation, it will pay back the debt within a period not to exceed the expected useful life of the project.

B. The city will not use long-term debt financing for any recurring purpose such as current operating and maintenance expenditures. Short-term debt instruments such as revenue, tax or bond anticipation notes shall be excluded from this limitation.

C. An internal analysis will be conducted for each long-term financing which analyzes the impact on current and future budgets for debt service and operations. This analysis will also address the reliability of revenues to support debt service.

D. The city will generally conduct debt financing on a competitive basis. However, negotiated issues may be used due to market volatility of the use of an unusual or complex financing or security structure.

E. The city will diligently monitor its compliance with bond covenants and ensure its adherence to federal arbitrage regulations.

F. The city will provide full disclosure on every financial report and bond prospectus and will strive to maintain the best possible bond rating on all debt issuances.

G. The making of any decision that involves the borrowing of one hundred thousand dollars ($100,000.00) or more must be discussed, considered and deliberated as a separate item of business on the agenda of a meeting of the city council.

(Ord. 97-116 § 2, 1997; Ord. 95-94 § 2 (part), 1995)

The budget is developed with the goal of presenting a clear picture to residents, council and staff of the city's direction. It shall include information about the city and the services that are provided. Summaries of revenue, expenditures and personnel will provide an overview of what funds are received and how they are spent. The remainder of the budget shall be devoted to detail about the services provided and the funds spent. Activity descriptions and annual departmental objectives will be listed and a report on accomplishments of the previous year budget objectives will be provided. This approach allows council members to make informed decisions about the emphasis they would like staff to put on various services. Therefore:

A. The annual operating budget for the city will be presented in a line item budget format.

B. The city will avoid budgetary and accounting procedures that balance the current budget at the expense of future budgets.

C. All budgetary procedures will conform to state regulation and generally accepted accounting principles.

(Ord. 95-94 § 2 (part), 1995)

A. The purpose of the capital improvement program is to plan, schedule and finance capital projects as determined by the city council. The city's goal is to prepare a comprehensive five-year capital improvement budget. The capital improvement program will include major on-going maintenance and repair costs to existing infrastructure and facilities, as well as the cost of new facilities or capital improvements.

B. As part of the budget process, departments will submit capital improvement requests providing a detailed description of the proposed project or purchase. All requests will be reviewed and evaluated by the city manager using criteria set by city council policy. A comprehensive multi-year capital plan will then be developed and presented to the city council for further review.

C. The city will actively pursue grants and other outside funding sources for all capital improvement projects.

(Ord. 95-94 § 2 (part), 1995)