Agenda Item Wording:
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Review the biannual budget process for FY 24/25 & 25/26 and establish the biannual budgetary strategic goals.
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Deadline for Action: 10/31/2023
Submitting Department: Finance and Technology Services
Contact Name and Phone Number: Renee Nagel, 713-4375 Amee Swearingen, 713-4170
Department Recommendation:
Review the biannual budget process for FY 24/25 & 25/26 and establish the biannual budgetary strategic goals which will be used to shape the budget.
Background Discussion:
Every two years City of Visalia adopts a biannual budget. This budget also acts as a financial plan for the City. There are many benefits to using a two-year budget. Such as, reinforcing the importance of long-range planning, concentrates on budgeting for the accomplishments of significant objectives, creates a proactive budget that provides for stable operations, promotes more spending patterns, and reduces the amount of time and resources in preparing the budget document. The budget must be adopted by Council before the new fiscal year starts on July 1 to have the authority to spend throughout the year. The adoption process requires two public hearings and a resolution from Council. For the past 30 plus years, the City has received the Distinguished Budget Award through the Government Finance Officers Association (GFOA). The award has mandatory guidelines that the City has to meet in order to receive it. Receiving the GFOA award documents that the City follows the best budget and financial management practices which is important to bank institutions, bond ratings, etc.
Recently the GFOA has moved towards having the budget document become more focused around the City’s strategic goals and having more citizen input in shaping the budget. This was effective for FY 21/22. To meet these requirements, the budget timelines are advanced and shortened to allow for more citizens input and more detailed budget explanation at Council meetings. These requirements must be met to receive the Distinguished Budget Award.
Biannual Budgetary Goals:
The budget goals are used to help with budgeting operations and capital to ensure that the City is maintaining services levels. Below are the current budget’s strategic goals:
• Maintain Quality of Life for Citizens
• Continue to Improve Infrastructure and Replace Capital
• Maintain Financial Stability
• Enhance City Services by Adding Staff, Programs, and Technology
• Facilitate and Promote Economic Development
The budget document includes the City’s mission statement and core values. In August, Council approved the City’s new mission statement and the City’s values as a part of the City’s rebranding. Below is the recently approved mission statement and values:
Mission Statement - Our mission is to enhance the lives of Visalians by providing services and solutions that create a vibrant and connected community.
Values - COV
Community - We care deeply for our community and strive to provide transparency and equitable services in an approachable and friendly way.
Opportunity - We are dedicated to enhancing Visalia by providing opportunities for economic and social development.
Vibrancy - We embrace unique perspectives and backgrounds to create a vibrant and welcoming city.
These should be used to help shape the budget and Councils goals. Staff is recommending adopting similar goals for the upcoming biannual budget. The new format allows for some additional points that explain each strategic goal in more depth. Below are staff’s recommended goals for the FY 24/25 & 25/26 Budget.
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Quality of Life • Maintain quality of life for the citizens of Visalia • Continue City efforts to reduce homelessness while collaborating and advocating regionally as appropriate. • Provide affordable housing through a variety of programs and policies • Provide diverse community experiences and personal enrichment for all ages • Continue to improve parks, recreational amenities, open space and trailways for a connected community |
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Fiscal Strength • Continue to maintain the City’s good fiscal health and sustainability • Adopt a balance budget • Continue to maintain the General Fund Emergency Reserve at 25% of operating expenditures. |
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Invest in Infrastructure & Growth • Plan for the development of future infrastructure • Maintain, improve, and replace assets and infrastructure within the City • Ensure safe, reliable infrastructure that benefits the community • Seek grant funding to maintain and expand City infrastructure to meet the community needs • Manage, maintain and enhance the City’s roadways to provide a safe and effective transportation system |
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Organizational Excellence • Provide excellent public service that is efficient, accessible and responsive to all • Provide high-quality essential City services • Attract and retain a talented, diverse and engaged workforce across the entire City organization • Utilize and add technology to increase efficiencies for City services • Continue to make improvements that equips the City to deliver excellent services to the community |
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Economic Vitality • Promote a vibrant economy that provides an equitable opportunity for all • Facilitate programs to develop, attract and retain businesses • Foster economic development in both commercial and industrial |
The icons shown will also be used throughout the budget document. They will be placed throughout each department’s budget section to show how they are meeting these goals.
Budget Survey:
To involve the citizens in the budget process, staff administered a budget survey which was advertised on the City website and social media outlets from September 27 - October 11th. In order to keep the survey manageable on the funds with the most flexibility, staff focused on the General Fund which is the only major fund that has discretionary funds. In addition, the General Fund includes all departments and general city services. The other funds are non-discretionary due to fees being charged for specific services.
The budget survey consisted of six questions, which received 120 responses. The survey questions and results are attached to the agenda.
According to the survey, the top priorities for citizens on where the budget money should be spent are Police, Fire, Park maintenance, Streets and Traffic maintenance. The survey included a fill-in option for services not listed (non-General Fund) that Citizens could fill in if there was a service they felt needed to be funded. This open-ended question did not return any statistically significant responses.
When comparing the survey results to the current budget appropriation, staff has concluded that the budget is in line with our citizen’s priorities. Public Safety is 60% of the total General Fund budget. Streets and Traffic Maintenance was listed as a second priority. This maintenance has dedicated funding sources such as Gas Tax, SB1, Measure N, and Measure R funds. The next priority was Park Maintenance (including trails and landscape and lighting) and is funded through the General Fund, Measure N and Landscape and Lighting. To address homelessness in Visalia, Council has authorized the use of HOME, CDBG, Successor Agency Housing, and PLHA funds to fund various homeless projects and programs including the TC Hope Navigation Center, Sequoia Village Permanent Supportive Housing, the Majestic Project, the VHC Seasonal Warming Center and the tenant based rental assistance program. The other question focused on how citizens would balance the General Fund budget if there was a deficit. Majority of the survey (61%) would balance the budget by reducing current operating expenses. This method has been used in past budgets when a deficit existed before implementing other balancing methods.
Summary
The results of the survey are very similar to how the General fund is currently funded. It is staff’s intent to bring a budget that continues the level of service provided to the citizens and incorporates Council’s priorities. Staff will be having the budget kickoff meeting with all the departments as outline in Table 1, Budget Process Calendar and staff will be returning to Council in February to start the six year capital project review.
Table 1
Budget Process Calendar
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Budget Activity |
Month Due |
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Citizen Input - survey/forum |
October |
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Council Strategic Goals Work Session |
October |
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Budget Kick Off/Baseline Budgets created |
October- November |
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Departments submit capital |
December |
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Departments submit budget requests & Mid Year Projections |
January |
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Finance review departments submittals |
February |
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Budget and Capital Work Sessions with Council |
February - May |
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Mid Year Presentation |
May |
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Budget Document Adoption |
June |
Fiscal Impact:
None
Prior Council Action: None
Other: N/A
Alternatives: None
Recommended Motion (and Alternative Motions if expected):
recommendation
Move to approve the budget goals for the FY 24/25 & 25/26 biannual budget:
1. As staff recommended in the report
Or
2. Per Council’s modifications of ……
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Environmental Assessment Status: N/A
CEQA Review: N/A
Attachments: 2024-26 Budget Survey Summary