City Manager`s Budget Transmittal- FY 2007/08

City Manager’s Budget Transmittal
budget request is $139 million; $2 million or 1%
higher than the budget adopted for FY 2006/07.
Mayor and City Council:
I am pleased to submit the FY 2007/08
Operations and Maintenance Budget for the City
of Santa Rosa. The budget totals $347 million for
the upcoming fiscal year and will provide funding
for a variety of City services. Several high visibility
capital projects will be moving forward in 2007/08.
Newly established City Council Goals along with
Vision 2030 initiatives are considered in this
budget and progress is being made on multiple
environmental issues. The voter approved
Measure O quarter cent sales tax revenues will
provide funding for a new fire station in this fiscal
year, increases in gang prevention programs, and
higher public safety staffing levels. Unfortunately,
this budget is being brought forward in the midst
of a very challenging economic environment. Last
fiscal year we thought the tide had turned after
multiple years of budget reductions. In 2007/08,
General Fund revenues will be limited due to the
housing market slowdown. The duration of this
slowdown will dictate available resources to fund
general government services over the next few
years. As mentioned above, however, the City
has made progress on key initiatives even with
these fiscal constraints.
Economic Environment
Over the past year the economic climate has
changed dramatically in northern California.
approximately 5% over the past 10 months and
more than likely will continue to fluctuate in the
near term before stabilizing later this summer.
Real Property Transfer Tax revenues dropped
25% in 2006/07 and are projected to remain flat
through 2007/08. Other construction related
revenues are also off considerably. Sales tax
revenues have not grown as projected during
2006/07 and there are concerns about growth in
both the construction and transportation sectors
next fiscal year. These revenue shortfalls have
reduced the resources available to fund General
Fund programs. We will be keeping an eye on the
economy during the upcoming budget year.
Depending on the duration and severity of the
downturn, adjustments may be necessary during
one or more of our quarterly financial updates.
there will be a
continued focus on
economic development.
There are
several things going
on downtown including the recent
purchase of the AT&T building, the opening of a
Police sub-station, the development of mixed use
mid-rise buildings, and the establishment of a
downtown business attraction program. We are
also in the process of having discussions with the
Wells Fargo Performing Arts Center regarding the
possibility of moving downtown.
FY 2007/08 Financial Overview
The balanced General Fund budget
comprises $139 million of the total $347 million
City budget. Included in the General Fund budget
are expenditures of $131 million and transfers out
of $8 million; $1 million of which are to the
Capital Improvement Program. The total budget
for the City is down 11% from the FY 2006/07
amount mainly due to a proposed bond sale for
the Utilities Department that did not materialize
last fiscal year. Of the total budget, $288 million
represents operations and maintenance and $59
million is appropriated for the Capital
Improvement Program. The total General Fund
City Manager’s Budget Transmittal
City Manager’s Budget Transmittal
Improved Public Safety
This year’s budget continues to provide
significant resources for public safety services.
complete design, construction and opening of fire
stations in the Mendocino/Steele Lane and
Fountaingrove Parkway areas. Nine positions are
included in the Fire Department’s budget to staff
the proposed fire station at Mendocino Avenue
and Steele Lane. The Recreation and Parks
Department is Leveraging Measure O and other
City and grant resources to increase the number
and variety of after-school and summer gang
prevention and intervention sites and programs
offered to at risk youth in Santa Rosa by
organizations. Sworn Police Department staffing
has remained fairly constant, and the number of
authorized positions to be filled has gone from 22
last fiscal year to 16 currently.
will have a continued emphasis on traffic, bicycle,
and pedestrian flow and pavement maintenance,
along with several environmentally focused
projects. Our goal is to take advantage of
outside revenue sources to maintain an active
Capital Plan and address infrastructure needs by
securing the maximum amount of regional, State,
and federal grant revenues available. Staff is also
making progress on the analysis of the City’s
future infrastructure needs between now and
recommendations will be forthcoming during FY
Santa Rosa 2030 and City Council Goals
During this past fiscal year, the City has
engaged the community in a process to envision
what the City of Santa Rosa could be like in the
year 2030. During the first part of FY 2007/08,
the City Council will be getting further input from
a breadth of community groups and enlisting
future support for various initiatives as part of
Santa Rosa 2030.
In January the City Council held their twoyear goal setting process. There were a number of
goals associated with Santa Rosa 2030 initiatives
[Creating a Vital Downtown; Thriving Diverse,
Healthy and Safe Neighborhoods; Open Space and
Recreational Activities; Creating Additional
Transportation Alternatives; More Inclusive
Community; Deliver a Safe and Efficient
Transportation System; Develop Regional Gang
Prevention and Intervention. In addition, City
Council developed goals associated with the
following areas: Maintain a Leadership Role in the
Region for Environmental Initiatives; Promote a
Healthy and Growing Economic Base; and Provide
Resources for Seniors and Youth.
There are several other departmental
initiatives that will move forward in the upcoming
fiscal year. They include improving City and
rearchitecture of the City’s web site to make
information access and e-government easier, and
completing a Recreation and Parks master plan.
Funding for Maintenance Services and
Capital Projects
Over the past several years budget
reductions were implemented and maintenance
services in the City were reduced. Over time,
these budget reductions have become
increasingly visible to our community.
2006/07, progress was made regarding the
restoration of some of those services. The
upcoming fiscal year will also provide some
resources to continue in the right direction. In
Public Works an electrician position is being
recommended to reduce the street light
maintenance backlog. A skilled maintenance
worker that is funded by the Redevelopment
Agency is also being added to assist in the
downtown area.
Minimal General Fund resources are
available next year to be allocated to the Capital
Improvement Program. Nonetheless, a number
of high visibility projects will make progress in FY
2007/08. For example, A Place to Play and design
work on a reunified Courthouse Square are both
moving forward in FY 2007/08. Public Works
City Manager’s Budget Transmittal
City Manager’s Budget Transmittal
Multiple environmentally focused initiatives
will also advance during 2007/08. They include a
tiered-rate water billing methodology to stimulate
water conservation, underground fuel tank
remediation, green building construction and
repair, and the construction of photovoltaic arrays
to generate clean energy. Impacts of the newly
adopted Environmentally Preferred Purchasing
Policy will be felt in 2007/08 and beyond. Finally,
the Transit and Parking Department will provide
service using the City’s first gas-electric hybrid bus
in the upcoming fiscal year.
California Society of Municipal Finance Officer’s
award for Excellence in Operational Budgeting for
last year’s budget.
It is in an environment of fiscal uncertainty
that I present this budget to the City Council for
their consideration. The housing market decline
has impacted our revenues and put pressure on
our ability to fully fund needed maintenance and
desired service levels. Although reductions were
not part of this budget, we will be monitoring our
financial situation closely as we move through the
next fiscal year.
On a positive note, tourism is up and despite
the construction industry, our local economy is
healthy. Numerous capital projects that were funded in
the past will start construction or will be completed
next fiscal year. In addition, we will occupy one, and
possibly two new fire stations.
We are fortunate to live in an award
winning City and this past year was no exception.
We received multiple awards including 1st place in
the California Law Enforcement Challenge, the
2006 Award of Excellence from the California
Counties Facilities Services Association, the Preserve
America Community designation, the Achievement
of Excellence in Procurement award, the Gold Award
for Competitiveness Achievement in our Utilities
Department, and an award for our Venture Communities Program. An article titled “Santa Rosa
Encourages People to Build it Green” was featured
in Western Cities Magazine. Last but not least, we
are a finalist for the All-America City Award.
Our community has faced its opportunities
and challenges collaboratively with a can-do
attitude by employees, boards and commissions,
community groups and members, business, and
other government agencies. I am confident that
we will continue to do so and that this budget will
move the organization and City forward.
Budget Document Structure
Following this transmittal letter is a Budget
Overview which provides an economic outlook
for the region and the City, highlights key
elements of the budget, and provides a detailed
review of the City’s Five-Year Forecast. There is
also a section that discusses the City’s 2030 Vision
and related City Council Goals. Departmental
sections of the document outline objectives for
the coming year and accomplishments from the
present fiscal year. Lastly, changes in the budget
from year to year are described in narrative form
in the “Major Budget Changes” paragraph of each
department’s section of the budget document.
Facilitation of the budget process and the
development of a budget document is a major
undertaking. The team effort reflects the
collaborative spirit within our community and
organization. I would like to thank the
departments, departmental budget coordinators,
and the City Council Budget Subcommittee for
their efforts, support, and deliberation during the
budget process. Lastly, I would like to thank
budget staff in the Administrative Services
Department: Bill Mushallo, Jean Gill, Brian
Cochran, and Sheri Hartz. They did a great job
coordinating the city-wide efforts on budget and
capital plan development, forecast updates, and
document production. I also congratulate them on
receiving the Government Finance Officer’s
Distinguished Budget Presentation Award and the
Jeff Kolin, City Manager
City Manager’s Budget Transmittal