1978 ADJ MTG MIN JUN 13 - Laserfiche WebLink

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In -Lieu Taxes This charge has -traditionally been comprised of -two parts: (A) A franchise fee of 3% of gross revenues. (B) A property tax on assessed valuation utilizing the current tax rate. I propose the franchise fee be reduced -to 2%, since that is -the rate charged to Southern California Edison and Southern California Gas Companies. This will cause a reduction in revenue to the General Fund in the amount of $46,500. Because of -the passage of Proposi- tion 13 on June 6, 1978, -the maximum property -tax -that can be levied is 1% of market value. I realize this limitation would, under pri- vate industry circumstances, be allocated -to other county agencies, however, we should apply comparable costs -to -the Enterprises if we are to determine -that they are self-supporting and not relying on General Fund support. This change in property taxation will result in an additional $150,680 -to the General Fund. By utilizing the cost accounting formula for administration and collection costs, a more realistic rate for franchise fees, and -the property tax limitation provided by law, -the General Fund will be reimbursed an additional $131,915 by the Enterprise funds for support services. The following reflects these additional costs to -the Enterprises by Fund: Sewer Increase Electric Water Treatment & Refuse to Utility Utility Collection Collection Gen. Fund Increase(Decrease) $(37,635) $44, 525 $85,850 $39,175 $131,915 This reassessment of methods used for charges will not directly cause an increase in utility rates, however, the deficits of these Enter- prise Funds will not be eliminated as soon as previously anticipated. THOMAS J. CALABRESE /s/ City Manager TJC:mer Atch . Object or Departments Travel & meetings Dues & publications Overtime Curb & gutters Parks Maintenance` Street Trees Recreation Library Traffic Signs Traffic Striping Planning Department ALTERNATIVE A Proposed Decreases $21,355 (50 of budget) $ 4, 850 (50% of budget) $49, 970 (50% of budget) $46,010 100% $11,105 4% $104,595 1000/. $21,395 46/0 $79,088 44% $12,210 50% $15,092 50% $13,875 17% The above alternative would encompass a layoff of 13.5 persons and possibly would affect -the majority of CETA employees which would number approximately 64 - AN UN 1 3 1978