Agency Budgeting Schematic - Culver City

Culver City is a full-service City, serving a resident population of approximately 40,000 and a daytime population of approximately 60,000. Services provided include police, fire, general maintenance, public improvements, planning and zoning, refuse collection, municipal bus lines, park, recreation and community services, and general administrative services. This paper will attempt to analyze the financial health of Culver City by examining the current available budget.

Culver City provides an updated annual Comprehensive Financial plan which is an all-inclusive report that provides a description of each of the City's funds and a ten-year projection of revenues and expenditures. The Comprehensive Financial Plan is an informational tool for the public and a management tool for the Council and staff. The Plan was developed to ensure the financial health of the City and is used to identify fiscal issues early enough to develop a strategy to address those issues before they become a crisis. The Plan is updated and presented to Council annually.

http://www.culvercity.org/Government/Finance/FinancialPlan

The plan has describes the analysis of multiple financial concerns together at the same time, allowing the agency to address and strategize fiscal options and prioritize accordingly.

The City's comprehensive financial plan provides a realistic account of the health of the municipality. It clearly addresses how the current economic recession is directly impacting the City:

* Property Tax and Real Property Transfer Tax

* Revenues have slowed

* Median SFR price has slowly begun to decline while number of sales has decreased drastically

* Sales Tax revenues have slowed down

* Disposable income declines as resetting rates cause mortgage payments to increase

* Decline in value of home coupled with decline in value of investment portfolio causes decline in overall wealth and consumer confidence

* Westfield construction has resulted in temporary decrease of sales tax from the site

* Steadily declining Sales Tax receipts, which is City's #1 source of revenue

* The credit crisis has brought almost all new development to a halt, negatively impacting one-time fees paid by developers and long term economic impact of underutilized land

* Businesses, both nationally and locally, are closing at an alarming pace, which causes a further reduction in Sales and Business Taxes and creates more underutilized space

http://culvercity.org/Government/Finance/~/media/Files/Finance/ComprehensiveFinancialPlan/ComprehensiveFinancialPlan_PowerPointPresentation_030909.ashx

It's also evident that the State's budget gap has significant impact on local agencies. Culver City's financial department reports "California is experiencing an ongoing budget crisis and has had to shift billions of dollars away from local agencies to try to balance the budget over the last few years. During Fiscal Year 2009-2010, the State of California took $10.9 million from the Culver City Redevelopment Agency. We expect a second payment of over $2 million in Fiscal Year 2010- 2011. Funding for schools and social programs has been cut statewide and it is evident that further cuts will be necessary over the next few years or the State will not have the funds operate.

Consequently, the dire long range budgetary problems of the State have caused uncertainty in terms of local programs and revenue streams. The Finance Department goes on to state further issues the agency has addressed to align and control expenditures, "Despite Culver City's relative financial strength and economic diversity, the City was forced to make some very significant decisions, including eliminating 60 positions in FY 2010-11, in order to maintain that condition. Even with this significant cut, the City's current level of expenditures cannot be sustained. Under the direction and leadership of the City Manager, the City is continuing the process of re-aligning expenditures to conform to "new normal" revenue projections that are expected going forward."

The City maintains 24 individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General Fund, the Redevelopment Agency Low/Moderate Income Housing Fund, the Capital Grants Capital Projects Fund, the Redevelopment Agency Capital Projects Fund, and the Redevelopment Agency Debt Service Fund.

The table lists the major and non-major governmental funds, and the

three enterprise funds under the proprietary category, which are also considered major funds of the City.

http://culvercity.org/Government/Finance/~/media/Files/Finance/ComprehensiveFinancialPlan/ComprehensiveFinancialPlan_PowerPointPresentation_030909.ashx

The General Fund is used to account for resources traditionally associated with government which are not required to be accounted for in another fund including: property taxes, sales taxes, business taxes, utility taxes, transient occupancy taxes, licenses and permits, and fines and forfeits. The General Fund is used to finance most of the basic municipal functions including general administration, police, fire, community development and parks, recreation and community services. Fire and safety consume the greatest percentage of the operating budget, general employees fall in to the next percentage bracket, making them the second largest and part time employees is the third group. High pension and medical rates cause personnel costs accumulate to approximately 80% of budget. Personnel costs are projected to increase causing great stress on the General fund in the coming years.

http://culvercity.org/Government/Finance/~/media/Files/Finance/ComprehensiveFinancialPlan/ComprehensiveFinancialPlan_PowerPointPresentation_030909.ashx

Enterprise Funds are direct services to the general public where all or a substantial portion of the costs involved are paid in the form of user charges or fees for such services. Culver City has three enterprise accounts.

Transportation Fund is used to account for the operation, as well as the capital assets, of the City's transportation system. Other funding assistance comes from FTA Section 9 (Federal-Capital), TDA and STA (Capital and Operating), and Proposition