AgdaPkt 2019-02-25 Joint SA PFA - Laserfiche WebLink

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8.B. - Page 3 of 122 ANALYSIS The City Council has a history of taking intentional, proactive, and strategic steps to ensure fiscal sustainability, including adopting a structurally balanced annual budget, funding long-term needs, and maintaining a 15 percent General Fund reserve level. The City has recently taken many steps towards strengthening the City's financial position and increasing transparency and operating efficiencies citywide. Those steps include: • Approving local pension reform two years ahead of Statewide changes • Updating development fees to ensure full cost recovery • Recommending a half -cent sales tax increase which was approved by 68 percent of voters in November 2018, and will generate an estimated $8 million annually • Paying down pension liabilities by making additional direct payments to the California Public Employees Retirement System (CAPERS) beyond the annual amount owed, and setting up a Section 115 Pension Trust to pre -fund the City's pension obligations over time • Partnering with outside agencies to provide important community services in the most cost efficient way possible • Increasing transparency regarding the City's financial health through an expanded annual budget document and increased public communications • Developing a Five -Year Capital Improvement Program Building on these strengths, staff proposes the following additional steps to improve the City's budgeting and financial management: • Developing a Ten -Year Forecast to provide a longer-term roadmap to financial sustainability • Organizing a community engagement event regarding the City's finances • Continuing to contain costs through efficiencies, shared services, and innovation • Considering new revenue sources • Recommending a Two -Year Budget cycle beginning in FY 2020-21 in order to create efficiencies in the budget development process • Assessing the City's financial health through the League of California Cities municipal finance diagnostic tool • Implementing OpenGov, an online platform that will provide much more detailed and transparent budget information, performance metrics, and trends to community members • Engaging the Government Finance Officers Association to perform a best practices review of the City's financial processes and procedures prior to implementation of the City's new financial management system • Exploring the option of an accelerated payoff timeframe for pension obligations • Streamlining the development of the Capital Improvement Program in an effort to provide a more realistic and financially viable roadmap of the City's capital needs All of the sections outlined below reflect efforts underway to maintain the fiscal health of the City, while at the same time supporting numerous initiatives to advance the City Council's priorities. City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.ore 229