AgdaPkt 2021.02.22 Joint SA PFA - Laserfiche WebLink

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8.A. - Page 2 of 42 in order to preserve the City's ability to support the community in this critical time and to make progress on the City Council's priorities and Strategic Plan. Additionally, staff recommends retaining $7.5 million in one- time savings from FY 2019-20 to help address the anticipated FY 2021-22 deficit. The City's conservative financial practices have positioned the City well to avoid layoffs and abrupt disruptions to City services. Budget recommendations continue those practices by proactively addressing long-term needs, including paying off pension liabilities within 17 years to save taxpayers approximately $38 million. The major components to this staff report including the following: 1. FY 2019-20 year-end budget update and ad'lustments to FY 2020-21 budget This section of the staff report includes actual operating results of the General Fund for FY 2019-20, including recommended budget appropriations to utilize a portion of the operating balance. The FY 2020-21 Revised Budget approved by the City Council on October 26, 2020 included a Ten -Year General Fund Forecast that projected a FY 2019-20 operating balance of approximately $11.0 million, after $7.1 million in anticipated limited term funding of City Council priorities. Final operating results for the General Fund have been calculated and resulted in an actual year-end operating balance of $12.1 million as of June 30, 2020. Staff recommends that $7.5 million of this total be retained to address the anticipated FY 2021-22 operating budget deficit, with the remainder of the final operating balance allocated to address COVID19 response and recovery, to support multi-year efforts to reimagine services, and to fund long-term community needs. 2. FY 2020-21 Mid -Year Budget Update —General Fund This portion of the staff report includes highlights of FY 2020-21 budgetary performance based on actual results through December 31, 2020 for the General Fund. 3. FY 2020-21 Mid -Year Budget Update — Capital Improvement Program Fund This portion of the staff report includes highlights of FY 2020-21 budgetary performance based on actual results through December 31, 2020 for the Capital Improvement Program Fund. 4. Preliminary Ten -Year General Fund Forecast This section discusses significant factors affecting the General Fund's major revenue sources (property taxes, sales taxes, transient occupancy taxes, development -related revenue, and other significant revenue sources) and expenditures (in particular, increasing payments for pension and retiree health benefits). The Preliminary Ten -Year General Fund Forecast is included as Attachment A. It is accompanied with an Economic Update in Attachment B. 5. Adjustments to the FY 2020-21 budget resulting from the FY 2020-21 Mid -Year Budget Update FY 2020-21 budget adjustments are being proposed to formally appropriate funding for limited - term City Council priorities including COVID19 response and recovery, to support multi-year efforts to reimagine services, and to fund long-term community needs. 6. FY 2021-22 Budget Development This portion of the staff report details principles and key milestones for developing the FY 2021-22 Recommended Budget. The City's Strategic Plan and financial policies and best practices continue to guide development of the FY 2021-22 Recommended Budget. Page 2 of 28 City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.org 533