PURPOSE:

The purpose of this report is to provide the City Council with a breakdown of the General Fund Projected Undesignated Non-recurring Fund Balance for June 30, 2005 in addition to other available non-recurring resources.  Additionally, a list of items/projects that could utilize one-time funding has been prepared per Council request.

BACKGROUND:

At the November 16, 2004 City Council Meeting, Council directed staff to bring back a list of projects for possible one-time funding for Fiscal Year (FY) 2004-05.  To recap, as of the First Quarter Report, a recurring General Fund balance of $1,482,413 is estimated for June 30, 2005.  In addition to the recurring fund balance is the projected non-recurring General Fund balance, which is the focus of this report.  The following is a breakdown of the estimated available balance for non-recurring sources anticipated for June 30, 2005:

Non-Recurring Fund Balance* (as of the end of the 1^st Quarter)               $2,914,176

Less: Estimated Mid-Year Requests                                                            ($  570,356)

ESTIMATED NON-RECURRING FUND BALANCE**                   $2,343,820

*The non-recurring fund balance is made up of the Undesignated Fund Balance as of July 1, 2004, minus the required increase in Reserves and Compensated Absences.

**In addition to the anticipated Mid-Year Requests, the Public Works Department will be conducting a study session with City Council on the Sidewalk, Street and Alley Infrastructure Program. Elements of this program, if approved, would reduce the amount of the Estimated Non-Recurring Fund Balance.

OTHER AVAILABLE NON-RECURRING RESOURCES:

PERS Ramp-up Savings FY 2003-04                                                      $1,993,000

During FY 2003-04, in anticipation of the PERS rates increasing over the next few years and the declining market and rates of return, the money typically ramped-up and used as a �savings� for one-time appropriations instead was set in the PERS Stabilization Fund to address future rate increases.  Staff is anticipating the use of these funds to assist in balancing the next three annual budgets.

Budget Stabilization Fund                                                                        $1,573,230

Due to recent budget challenges, the Executive staff developed the Budget Stabilization Policy that places any excess dollars from the previous fiscal year�s budget savings that are beyond 2 percent into a Budget Stabilization Fund.  This fund is designed to provide a safety valve and help mitigate the types of budget reduction decisions that the City will be forced to make over the next several years.  The $1,573,230 was funded from FY 2002-03 budget savings.

Utility Users Tax (UUT) In-Lieu Set Aside (estimated for 6/30/05)      $4,200,000

The UUT set aside funds are a result of electric rate increases and are intended for one-time projects or to be set aside as a reserve to mitigate any future decline in UUT or In-Lieu revenues.

Vehicle License Fee (VLF) Gap Securitization Funds                           $1,771,985

In FY 2003-04, the State failed to make three months of VLF backfill payments to cities and counties resulting in a VLF funding gap.  The State has agreed to make these VLF gap loan payments to cities and counties by August 15, 2006.  The State owes the City $1,771,985.  Under SB 1096, the California Communities Gap Loan enables local agencies to sell their VLF receivable to California Communities for an upfront fixed price between 90-96% of their receivable.  Assuming a conservative 90% sale price, the City would receive $1,594,986 from the amount owed by the State.  At the February 8, 2005 Council meeting, staff will be presenting the sale documents for approval and recommend that the net sale proceeds be added to the Community Services Building Project.

Capital Projects Contingency Appropriation                                         $3,928,292

The current balance in the capital projects contingency account in Fund 370 is $3,928,292.  This account is designed to offset any shortfalls related to capital projects.

Interest Earned � Bond Proceeds                                                           $742,874

Another source of one-time funding is from interest earned on bond proceeds in Fund 370 (Capital Projects).  As of December 31, 2004, the City has earned a total of $742,874 from unexpended bond proceeds that are available for capital projects such as the Community Services Building.

PROJECT LIST:

Per Council request, staff has compiled the following list of projects that could utilize these one-time funds.

Community Services Building (CSB) - $28,100,000

This project is the construction of a new 68,000 square foot facility to house the Public Works, Community Development, Park, Recreation and Community Services Departments as well as the Public Information Office on the southeast corner of Third Street and Orange Grove Avenue.  Of the estimated $28.1 million in project costs, $3.75 million is currently not funded.

Robert �Bud� Ovrom Park - $10,200,000

This project is the construction of a new 16,000 square foot facility to house a Community School for the Burbank Unified School District and a Community Center for the Park, Recreation and Community Services Department, including a small park element and on-site parking.  Currently, $1 million is not funded for this project.

Public Safety Suite Project � Estimated $1.3 million to $3.4 million

This project incorporates the upgrade/replacement of the existing Police Records System with a Windows� suite of products, designed to provide public safety agencies with the ability to collect, manage, share and effectively use critical information including: Computer Aided Dispatch Software, Records Management System, Mobile Applications, and Field Based Reporting with Automatic Vehicle Location.  The project is currently in the product review and selection phase and project costs are estimated to be between $1.3-3.4 million depending on the winning vendor.  Costs include hardware, software, licenses, implementation services, support and training.  The ramp up funds to date are $631,934.

Mayor�s Youth Task Force - $250,000 (Recommended for review by Councilmember Golonski)

It is the goal of the Mayor�s Youth Task Force to research and evaluate youth programs that address the needs of Burbank youth.  Several programs have been forwarded to City Council for funding and approval.  Examples of previous programs recommended by the Mayor�s Youth Task Force and approved by City Council are PeaceBuilders, Got Wheels!, Youth Employment, Middle School Grant Program, Teens in Action Communication Media, and Teens in Action Police Youth Relations Committee.

Unanticipated Youth Services - $150,000 (Recommended for Review by Councilmember Golonski)

This project funding recommendation is to provide funding for potential Youth Services projects.

Youth Services - $100,000 (Recommended for Review by Councilmember Golonski)

This project funding recommendation is to supplement the CDBG funding towards Youth Services.

Perform Arts Grant Program Restoration - $74,500 (Recommended for Review by Councilmember Golonski)

The City�s PerformArts program funded a variety of performing and visual arts programs in the Burbank Community.  As part of the overall cost reduction process over the past few years, funding for the program was reduced from $74,500 to $39,073 for Fiscal Year 2003-04.  For Fiscal Year 2004-05, all the remaining funding was eliminated.

Media District Shuttle Program - $269,000 - $500,000 (Recommended for Review by Councilmember Vander Borght)

The Media District Shuttle Program is being recommended by the Transit Services Task Force to expand shuttle services in the City of Burbank.  This expansion would be a fixed route shuttle service serving the Media District area. Cost estimates are based on whether shuttle vehicles are leased or seven new City vehicles are purchased.  Staff�s recommendation is to fund the expansion with Proposition A and Proposition C (Transportation Funds) unappropriated cash reserves.

Frozen Staff Positions (Recommended for Review by Mayor Ramos)

Due to budget reductions during the past few fiscal years, a number of staff positions have been frozen to meet reduction goals.  Attachment A provides a list of those positions currently frozen.  It is important to note that cost associated with reinstating any frozen positions are recurring in nature.

Capital Projects �Dream� List (Please see Attachment B).

The Executive Staff has compiled a comprehensive list of Capital Projects throughout the City.  This list, referred to as the �Dream� List, describes what the project is, the cost estimate, funding status, funding sources, start date estimates for design and construction, and the lead department is for the project.  Attached is an updated list of information.

FISCAL IMPACT:

The Fiscal Impact will be based upon the City Council�s funding decisions.  It is important to note that the funding resources previously listed are non-recurring.  During this year�s budget process, the City�s General Fund will still be faced with the challenge to balance recurring revenues and expenditures.  Some of these available non-recurring revenues, such as the PERS Stabilization and Budget Stabilization Fund, may be beneficial to balance any future fiscal year budget gaps.  Staff will continue to update the City�s Long Range Budget Balancing Plan which will program the use of these funds as appropriate.

STAFF RECOMMENDATION:

At the November 16, 2004 City Council Meeting, the E-Team recommended that the projected undesignated available balance of non-recurring funds be set aside to fund the Community Services Building, Robert �Bud� Ovrom Park, and Police Records Management System Replacement Projects.  It is still recommended that these projects be funded.

Attachments:

A         Frozen Position List Summary

B          Capital Projects �Dream� List (as of January 14, 2005)

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