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I I I II - said that the State Board of Equalization advised there were approximately 5,600 sales tax permits in Redwood City, and the top five businesses account for almost one-fourth of the City's sales tax revenues, the top ten account for a little over one-third, and the top twenty- five businesses account for over one-half of the sales tax revenues. He said, "This tells us that not only is this a very volatile source of revenue, but it is also a very concentrated source. The good news that we are seeing in the Budget for each of the next two years can quickly go away depending upon a couple of business decisions made in this community." In response to Council Member Bain's questions, Director Ponty advised that the top five businesses in Redwood City were Oracle, Boardwalk Dealership, Towne Ford, Granite Rock and probably Enterprise Network Systems. City Manager Everett said State Law prohibited the disclosure of actual sales tax figures. Council Member Ira said that the assumption of a 4% increase in salary and benefits wasn't feasible, "especially with the unemployment that we have in San Mateo County. I think last week, just because of the problem we are having with competition, that we ended up giving an increase to IT (Information Technology Department.) I think we really need to keep that in mind. I think that is probably a really low number for an assumption, especially in light of the fact that 69% of our Budget is comprised of salary and benefits. It can have a major impact on those figures in subsequent years. Council Member Ira said - it was very important to remember that 57% of the City's revenues come from sales and property tax and "pretty much, they go out the door to Police and Fire which comprise 52% of our expenditures. Over half of our revenues are immediately predetermined.... That leaves 48% for the balance. As Brian mentioned, if the sale revenues decrease... you will have to look for other revenue sources to fund Fire and Police. That's important to keep in mind." MEMO 6130/98 C. Departmental Presentations - 5-10 Minutes per Department: 1) City Council and City Manager - Assistant to the City Manager Cherise Moore; Assistant to the City Manager Moore described the proposed increases in the City Council Budget. She explained that $49,000 for funding for Shelter Network had been included in the Council Budget, but could be moved into another Budget if the Council wished to do so. (CDBG funds of $30,000 have also been allocated for Shelter Network.) She said the City Clerk Department would now be managing funds required for Council support services for Council and citywide receptions, city plaques, proclamations and awards, and Council meals. She said the proposed Budget included an increase to the Mayor's Fund of $3,800, totaling $5,000, to provide emergency funds for Council approved projects such as local teams or cheer leading - squads needing funds to travel and represent Redwood City. BUDGET STUDY SESSION MINUTE BOOK NO. 57 JUNE29,I998 MINUTES Page No. 009 PAGE 5