1995 ADJ MIN JAN 21 - Laserfiche WebLink

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Councilmember Hutton inquired of the City Clerk if it is correct that Council is reviewing Fiscal Year 1994-95, pursuant to Resolution R-124- 94, approved October 1994. City Clerk Ramos replied that she did not assemble the material for the mid -year budget review, presently before Council. She concurred that this is the mid -year budget review. Former Mayor Frank Gonzales asked why City Council was reviewing the 1994-95 budget since it was a balanced budget. He believed this action was premature. He inquired why they were making the proposed reductions now. Councilmember Bennett asked City Manager Martinez if this is the appropriate time for the Council to be doing mid -year review? City Manager Martinez said, "Yes." He indicated the Finance Director can now inform Council about revenues, due late in the year, but were received after January 17th. Councilmember Bennett asked City Manager Martinez if the City will be out of cash in November 1995. Mr. Frank Gonzales asked how can the City be exceeding revenues when its portfolio is $13 -plus million for payroll daily, before quarterlies start coming in. He failed to see the problem. Councilmember Beltran exclaimed that budgets are based on forecasting; with shortfall in revenue, one can overspend. Here, revenue is expected from Rancho Mediterrania but there are delays and the money is not showing up as revenue. He declared it was reasonable that there be a mid -year budget review as Council needs to bring the budget into conformity. Mr. Frank Gonzales asked Councilmember Beltran if he agreed that there was a balanced budget for 1994-95. Councilmember Beltran answered "No, because there is a shortfall. All revenue is based on forecast." With six months into the fiscal year, Mr. Gonzales wondered how a deficit could be declared. Councilmember Sanders explained that Council looked at the one-time revenue of $3.8 million and with 7 months into the fiscal year, the City has not received one penny. The balance of the fiscal year is under question. Councilmember Sandoval stated this revenue is not expected to come in until April/May. In the event this does not materialize there are two separate alternatives. He said the money balance is corroborated by Attorney Brooks London and Economic Development Director Gabriel. Councilmember Sandoval referred to fiscal report dated January 19, 1995 where it stated that general fund expenditures are exceeding revenues on the average of $381,736 per month without encumbrances or if including encumbrances, the sum would be $489,480 per month. He expressed little confidence in the report before him. He said the fiscal year was adopted on a 12 -month basis; one doesn't pick quarters to develop figures. He declared the information bogus and was outraged with staff's report. 3 JAN 2 1 1995