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9.A. - Page 3 of 21 <br />• Adopting an aggressive pension plan funding strategy that includes making additional annual <br />contributions directly to CalPERS over the next 18 years to accelerate the unfunded liability payoff <br />period, saving the City approximately $38 million in interest <br />• Adopting a strategy of dedicating 80 percent of any fiscal year-end net operating balance towards <br />paying down the City's pension liabilities, with the remaining 20 percent going towards City <br />Council priorities <br />• Continuing to contain costs through efficiencies, partnerships, shared services, and innovative <br />operational improvements <br />• Analyzing the possibility of new revenue sources <br />• Implementing an online platform for business license and transient occupancy tax compliance <br />tracking, notification, and online payment processing <br />• Streamlining the development of the Capital Improvement Program (CIP) in an effort to provide <br />a more realistic and financially viable roadmap of the City's capital needs <br />• Paying down the pension liabilities by making additional direct payments to the California Public <br />Employees Retirement System (CaIPERS) beyond the annual amount owed, and making additional <br />contributions to the City's Section 115 Pension Trust account to pre -fund the City's pension <br />obligations <br />For the first time, the Fiscal Year 2020-21 Recommended Budget was developed utilizing OpenGov, an <br />online software first approved for implementation by the City Council in Fiscal Year 2019-20. This overhaul <br />supports continuous improvement efforts related to financial management, disclosure, and increasing <br />transparency of the City's operations, as well as enhancing the City's budget development process. In <br />addition, staff is currently in the process of receiving written guidance from the Government Finance <br />Officers Association (GFOA), who performed an onsite best practices review of the City's financial <br />processes and procedures in FY 2019-20. The GFOA guidance will identify specific policies and procedures <br />necessary to minimize the City's exposure to potential loss in connection with its financial management <br />activities. The results of this review will be presented to the Finance/Audit Subcommittee in the <br />summer/fall. <br />ANALYSIS <br />Forecasting future revenues in this uncertain climate is more art than science at this point. Data points <br />such as permit applications, reports from hotels and other local businesses, and close attention to regional <br />reporting from other cities begin to give a picture of the potential impact of COVID-19 on Redwood City. <br />Over time, the financial forecast picture will become clearer and we can make better decisions based on <br />both community needs and City resources. Steps the City will need to take depend on the depth, shape <br />and severity of the economic impacts. <br />Due to the extreme economic uncertainty and because management staff have been focused nearly <br />exclusively on COVID-19 response, on April 6, 2020, the City Council approved streamlining the <br />development of the FY 2020-21 Recommended Budget. As a result, staff rolled over the FY 2019-20 <br />Adopted Budget as a base budget, and then included updated salary and benefit costs, cost of living <br />adjustments already agreed to in bargaining agreements, and updated health insurance costs. <br />Page 3 of 20 <br />City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.ore <br />692 <br />