AgdaPkt 2017-06-12 Joint SA PFA - Laserfiche WebLink

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In spite of these challenges, City staff strive to provide high quality service to the community while advancing the City Council’s major priorities and strategic initiatives. Staff’s commitment to excellence is reflected in the enhanced Recommended Budget document before the Council. A significant amount of new information is included in the budget document, which is designed to better inform the City Council and community about the City’s operating budget. Enhancements to the document include: greater financial reporting, including FY 2015-16 Actuals; department descriptions, including FY 2016-17 accomplishments and FY 2017-18 goals; chart of department activities to fulfill City Council’s Strategic Initiatives; FY 2017-18 Capital Improvement Program (CIP) project pages; and new sections on the City’s strategic initiatives and goals, community profile, and debt. ANALYSIS Economic Outlook According to the California Department of Finance, the State should experience moderate economic growth over the next year; however, there are many variables that could change this outlook. The Governor’s FY 2017-18 Budget Summary reflects a decline in revenue, primarily as a result of lower personal income tax receipts than projected, which is compounded by increased Medi-Cal spending, resulting in a projected State budget deficit of $1.6 billion at the end of FY 2017-18. The California legislature’s nonpartisan fiscal advisor, the Legislative Analyst’s Office, is stressing the importance of fiscal restraint due to a high level of uncertainty related to federal policies that may affect the State. Potential federal policy changes could reduce federal funding and/or increase costs substantially in future years, especially potential changes related to safety net services, infrastructure, immigration, and healthcare. Regionally, Silicon Valley continues to be an economic leader due to significant job creation, stable employment, increasing property values, and numerous commercial and residential development projects. At the same time, these factors have contributed to quality of life concerns in our region, including: the demand for more affordable housing options; increasing traffic congestion; escalating infrastructure needs; low income residents moving away; and diverse views on the pace and nature of change. These factors all contribute towards the health and well-being of our residents, and in turn, affect the economic outlook of the City. On May 8, 2017, the City Council received a report and presentation from Dr. Jon Haveman with Marin Economic Consulting on the current economic conditions of the City. The report describes major factors which impact City resources and community needs, and is included in the Recommended Budget document. Local economists, including Dr. Haveman, are not forecasting an economic downturn during the next fiscal year; however, several factors indicate that a slowing of the 8.D. - Page 2