Laserfiche WebLink
REPORT <br />To the Honorable Mayor and City Council <br />From the City Manager <br /> <br />June 12, 2017 <br />SUBJECT <br />Annual Appropriations Limit for Fiscal Year 2017-18 <br /> <br />RECOMMENDATION <br />Establish, by resolution, the appropriations limit for Fiscal Year 2017-18 <br /> <br />BACKGROUND <br />In 1979, the voters of the State of California passed Proposition 4, the Gann spending <br />limit initiative (most recently amended in 1990 by Proposition 111). The initiative <br />establishes and defines annual appropriation limits for state and local government <br />entities and requires that the City adopt an appropriations limit annually. Moreover, the <br />initiative provides for annual adjustments for changes in population (for the City or <br />County, whichever is greater) and either the statewide percentage change in per capita <br />personal income, or percentage change in assessed valuation attributable to growth in <br />non-residential new construction. Growth factors are supplied by the Department of <br />Finance. <br /> <br />Additionally, the State code stipulates that fifteen days prior to the meeting in which the <br />limit is adopted, documentation used in the determination of the appropriations limit <br />shall be made available to the public. This staff report was posted on the City’s website <br />on the agenda section on May 26, 2017: www.redwoodcity.org/city-council-meetings- <br />agendas. The calculation is also available in the FY 2017-18 recommended budget <br />document, available at www.redwoodcity.org/budget after June 5, 2017. <br /> <br />ANALYSIS <br />The recommended appropriations limit for FY 2017-18 is $676,181,900 while the limit <br />for FY 2016-17 was $648,487,191. The proposed appropriations connected to the <br />estimated proceeds of taxes for FY 2017-18 are only $101,361,951, well below the <br />$676,181,900 legal limit. The increase from FY 2016-17 is primarily due to an increase <br />of 3.69 percent in Statewide per capita personal income, one of the factors used in <br />calculating the change in the appropriation limit. <br /> <br />The resolution displays the calculations utilized to arrive at this amount. <br /> <br />ALTERNATIVES <br />There are no practical alternatives as Article XIIIB of the State Constitution requires that <br />the state and all local entities adopt an appropriations limit annually. <br /> <br />6.3.A. - Page 1