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0.2 C- <br />REPORT <br />To the Honorable Mayor and City Council <br />From the City Manager <br />July 28, 2003 <br />Subject <br />Annual Appropriations Limit for FY 2003/04 <br />Recommendation <br />That the City Council adopt a resolution establishing the Appropriations Limit for the FY <br />2003/04. <br />Background <br />In 1979 the voters of the State of California passed Proposition 4, the Gann spending limit <br />initiative. The initiative establishes and defines annual appropriation limits for state and <br />local government entities and requires that the City adopt an appropriations limit annually. <br />Moreover, the initiative provides for annual adjustments for changes in population, and <br />either the statewide percentage change in per capita personal income or percentage <br />change in assessed valuation attributable to growth in non - residential new construction. <br />The recommended appropriations limit for FY 2003/04 is $198,916,483 while the limit for <br />2002/03 was $115,155,843. This later amount has been restated due to using an incorrect <br />factor in the FY 2002/03 computation (the previous amount was $104,246,342). This <br />year's sizable increase is due to the unusually large (72.1 %) increase in assessed <br />valuation attributable to non - residential new construction (one of the factors used in <br />computing the appropriations limit). The actual appropriation for FY 2003/04 is only <br />$48,698,362, well below the $198,916,483 legal limit. <br />The attachment displays the calculations utilized to arrive at this amount. <br />�Vi I_� <br />Brian Ponty <br />Director of Finance and Financial Planning <br />rl,Ze, <br />Edwatd v ett <br />City Manager <br />Attachment <br />Proposition 4 Appropriation Limitations FY 2003/04 <br />