AR 041508 Fiscal Review Committee

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CITY OF COLTON AGENDA REPORT FOR CITY COUNCIL MEETING OF APRIL 15, 2008 TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS FROM: DARYL PARRISH, CITY MANAGER SUBJECT: FISCAL REVIEW COMMITTEE DISCUSSION DATE: APRIL 8, 2008 BACKGROUND During the April 1, 2008 meeting the Council discussed the formation a Fiscal Review Committee to address issues that the City may be faced with relative to impacts from State cut backs and economic downturn. DISCUSSION/ ANALYSIS In Fiscal Year 2002-03 the City Council appointed a Fiscal Management Committee comprised of former Mayor Bennett, former Council Member Ramos and Council Member De La Rosa. The primary task of this committee was to review all recruitments, travel expenses and any other special needs that departments requested funding for that was outside the approved budget. This committee was disbanded and a new direction is being sought. As part of the typical budget development process, staff conducts numerous workshops with the City Council that gives the entire Council an opportunity to closely scrutinize each department's budget requests for the upcoming budget year. Staff believes that this process would address the short term concerns regarding budget development and not require a separate subcommittee structure. However, as the City Council is well aware, the Utility Users Tax (UUT) will expire on June 30th, 2011. This revenue source currently generates approximately $4.3 million to the General Fund and is expected to grow to $4.8 million by FY 10/11. This particular revenue source is approximately 11% of the General Fund budget and its elimination will significantly impact the City's ability to provide the level of services that the residents and businesses are accustomed to receiving. Therefore, staff would like to recommend that the Council authorize the formation of a "Blue Ribbon Committee" to formulate strategies to address the expiration of the UUT. Staff suggests that the subcommittee be comprised of representation from the Chamber of Commerce, Service Organizations, School District, residents, and other interested parties to assist a council Fiscal Review Committee and staff to formulate a plan for a replacement revenue source. FINANCIAL IMPACT None Bud et Year -to -Date Expenditures Oen Encumbrances Available Funds N/A N/A N/A N/A ENVIRONMENTAL IMPACT N/A RECOMMENDATION Staff seeks Council direction on the formation and scope of work of a Fiscal Review committee or Blue Ribbon committee both would be subject to Brown Act. FEVIEW TEAM ONLY y Attorney: /s/ Finance Director: /s/ y Manager: /s/ OTHER: