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 City of Hermosa Beach --- 06-12-01ADOPTION OF 2001-2002 BUDGET
RECOMMENDATION : It is recommended that the City Council:
BACKGROUND: The City Council held a workshop on May 24, 2001 to review the 2001-2002 Preliminary Budget. Staff was directed to look at ways to increase funds in the Capital Improvement Fund by $300,000 at the June 12, 2001 meeting. Staff indicated that a recommendation to increase parking rates would also be brought back as directed at Midyear Budget Review.
ANALYSIS: INCREASE IN PARKING RATES A survey of selected cities’ parking rates is attached, on page 5. Parking Meters Parking meters rates have been $.50 per hour since 1980. The City has approximately 1,540 meters, 70% of which are mechanical, with the other 30% being electronic. The electronic meter rates can be changed in one day, while the mechanical meters will require additional parts and take two months to change. It is recommended that meter rates be changed to $.75 per hour, with changes made as soon as possible. This rate is consistent with our neighboring cities. Estimated revenue will change from $780,000 to $955,000, an increase of $175,000 to the Parking Fund. Costs for changing the rates in the meters are addressed under Parking Meter Conversion on page 3. Parking Fines Parking fine amounts have not been changed since 1982 (other than to add the $5 mandated by the State for court construction, jail facilities and the State General Fund in 1991). As shown in the survey (page 5), our neighboring cities’ fines are $30 for red zones, time limit and street sweeping violations and $25/26 for expired meter violations. Citations for these violations represent 95% of the tickets paid for Hermosa Beach Municipal Code violations. Our rates are currently $20 for time limit, street sweeping and expired meters, with a $22 fine for red zones. It is recommended that fines for time limit parking, street sweeping and red zones be set at $30 (an increase of $10), that expired meter fines be set at $26 (an increase of $6) and other HBMC fines (representing approximately 5% of tickets paid) be increased by $10 to keep consistency among the violations. Additional revenue is estimated to be $335,000. Parking Lots Councilmember Reviczky suggested at the workshop that staff look into switching Lot A from attended parking to meters. Staff will report back on the cost/benefit of doing so at a future meeting. In the meantime, staff recommends moving forward with changing the hourly rates in Lot A and the parking structure from $.50/hour to $.75/hour, with a flat rate of $6.00 after 6:00 pm. The flat rate currently is $4.00 after 9:00 pm, which means that many people park without paying anything if they arrive before 9:00 pm and leave after the attendant is gone. Estimated revenue for Lot A will change from $190,399 to $266,764, an increase of $76,365; estimated revenue for the parking structure will change from $388,775 to $551,338, an increase of $162,563. Net income for the structure will change from $46,588 to $127,869, an increase of $81,281 to the Downtown Enhancement Commission (DEC) Fund. Recap of Revenue Revisions The following changes reflect the above recommendations.
PARKING LOT HOURS Staff recommends that hours for the parking lots be set from 8:00 am to 3:00 am, with the City Manager given the discretion to change hours as needed for special events or special needs. For example, during the Fiesta, it would have been beneficial for the structure/lots to be open earlier than 8:00 am for booth set-up. AMENDMENT TO PERSONNEL ALLOCATION It is recommended that the part-time, temporary Clerk Typist position in the City Clerk’s office be changed to a half-time, permanent position. The additional cost is $4,887 for retirement and employee benefits. Funds are available in Prospective Expenditures. AMENDMENTS/CORRECTIONS TO APPROPRIATIONS Capital Improvement Fund Following direction from the budget workshop to increase funds in the Capital Improvement Fund by $300,000, staff recommends that $300,000 be transferred from the General Fund to the CIP Fund. These funds are estimated to be available based on the increased meter and parking fine revenue. Parking Meter Conversion We have approximately 1540 meters, 70% of which are the old mechanical type, with the other 30% being the new, electronic meters. In order to change rates on the mechanical meters, it would cost $89 per meter for parts on 1,078 meters or $95,942. Converting from mechanical to electronic meters will cost $175 per meter or $188,650. Additionally, 136 of the meters require complete replacement of the meter head (not just the interior mechanism) at an additional $155 cost per meter or $21,080. Therefore a total of $209,730 is needed for meter conversion. It makes no sense to spend $96,000 on outdated meters that are nearing obsolescence from a parts standpoint. Therefore, it is recommended that $209,805* be appropriated for meter conversion if the new meter rates are approved.) This amount is available from increased revenue and still leaves $300,000 for capital improvements. *(There is $75 left over from the increase in revenue which was added to the appropriation for meter conversion.) DEC Fund Revenue In attempting to improve the legibility and appearance of the budget, the financial reports were downloaded to Microsoft Excel before printing. Unfortunately, in doing so, an incorrect page was used for page 33, DEC Revenue. The correct page is attached as page 9. (The recommended increases are not reflected, only the correction) Corresponding totals on the Fund Summary were correct so no other change is necessary. Be assured that every page will be double-checked prior to the final printing. County Share of Parking Structure Revenue The above change to the parking structure rates will change the payment to the County from $46,588 to 127,869. Public Works Administration/Parks As previously indicated, when these two divisions were separated in the Preliminary Budget, amounts for salaries, retirement and medicare in Public Works Administration were overstated. Corrected pages are attached as pages 10-12. The change reduced appropriations in this division by $120,073 and increased Prospective Expenditures by the same amount. Overall, expenditures remained the same. Sewer/Storm Drain Division Insurance charges were inadvertently omitted from the 2001-02 column on page 150 in the Preliminary Budget. The corrected page is attached as page 13. The Fund summary was correct. Budget Summary The Budget Summary, which incorporates the above corrections, is attached to the budget resolution. Footnotes have been added to show all amounts reserved or designated in each fund.
Five Year Capital Improvement Program The first year of the plan is adopted within the 2001-02 Budget. The Five-Year Plan will go to the Public Works Commission on June 13, 2001 and then come back to the City Council for adoption on June 26, 2001. APPROPRIATION OF FUNDS FOR 2000-01, ACCRUED COMPENSATION FUND There have been three retirements of long-term employees in the Police Department this fiscal year. Payoff of accumulated sick and vacation time to these employees necessitates appropriation of funds from the Accrued Compensation Fund. During the budget process, funds are budgeted for payout of accrued time in each department based on historical trends. Payouts, such as these, to long term employees, are outside the "norm" and require additional appropriations. A new estimate of the total annual payout, including these retirements was calculated. An estimated additional appropriation of $204,395 is necessary. The balance in the Accrued Compensation Fund is $718,746 so funds are available.
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